WISCONSIN PUBLIC SERVICE CORP, S-3, 1998-11-25

WISCONSIN PUBLIC SERVICE CORP
S-3, 1998-11-25
ELECTRIC & OTHER SERVICES COMBINED

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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FORM S-3

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

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

WISCONSIN PUBLIC SERVICE CORPORATION

(Exact name of registrant as specified in its charter)

<TABLE>
<S> <C>
WISCONSIN 39-0715160
(State or other jurisdiction (I.R.S. Employer
of
incorporation or organization) Identification
No.)
</TABLE>

700 NORTH ADAMS STREET
P.O. BOX 19001
GREEN BAY, WISCONSIN 54307
(920) 433-1598
(Address, including zip code, and
telephone number, including area code, of
registrant's principal executive offices)

LARRY L. WEYERS, MICHAEL S. NOLAN
CHAIRMAN AND CHIEF EXECUTIVE OFFICER FOLEY & LARDNER
WISCONSIN PUBLIC SERVICE CORPORATION 777 EAST WISCONSIN AVENUE
700 NORTH ADAMS STREET, P.O. BOX 19001 MILWAUKEE, WISCONSIN 53202
GREEN BAY, WISCONSIN 54307 TELEPHONE NUMBER: (414) 297-5672
TELEPHONE NUMBER: (920) 433-1334

(Name, address, including zip code, and telephone
number, including area code, of agent for service)

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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this registration statement, as the
registrant shall determine in light of market conditions and other factors.

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, please check the following box. /X/

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CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
TITLE OF EACH AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM
CLASS OF SECURITIES TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED PER UNIT * PRICE * REGISTRATION FEE
<S> <C> <C> <C> <C>
Senior Debt Securities..................... $102,000,000 $1,020 $104,040,000 $28,924.00
</TABLE>

* Estimated solely for the purpose of computing the registration fee.

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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.

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<PAGE>
PRELIMINARY PROSPECTUS SUBJECT TO CHANGE DATED NOVEMBER 25, 1998

THE INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. THESE
SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME
THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE
BE ANY SALE OF THESE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION
UNDER THE SECURITIES LAWS OF SUCH JURISDICTION.
<PAGE>
PROSPECTUS SUPPLEMENT TO PROSPECTUS
DATED , 1998

WISCONSIN PUBLIC SERVICE CORPORATION
$[50],000,000 SENIOR SECURED NOTES, % SERIES
DUE ,

Wisconsin Public Service Corporation will pay interest on the Senior Secured
Notes Due , , at the rate of % per annum on and of
each year, commencing on . The Company may [not] redeem the Notes [in
whole or in part at any time on or after , without premium.] [at its
option prior to their maturity.] The Notes constitute a series of the Company's
Senior Debt Securities. See "Description of the Senior Debt Securities" in the
accompanying Prospectus.

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

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ACCURACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
PER NOTE TOTAL
<S> <C> <C>
Public Offering Price(1) % $
Underwriting Commission(2) % $
Proceeds to Company(1)(3) % $
</TABLE>

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(1) Plus accrued interest from .

(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.

(3) Before deducting expenses payable by the Company estimated at $ .

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

The Underwriters are severally offering the Notes, subject to the prior
receipt and acceptance of the Notes by the Underwriters and their right to
reject any order in whole or in part. Delivery of the Notes will be made in
book-entry form only through the facilities of The Depository Trust Company on
or about , .

SALOMON SMITH BARNEY

A.G. EDWARDS & SONS, INC.

LEGG MASON WOOD WALKER
INCORPORATED

THE DATE OF THIS PROSPECTUS SUPPLEMENT IS ,
<PAGE>
CERTAIN TERMS OF
SENIOR SECURED NOTES, % SERIES DUE ,

Please read the following information concerning the Notes in conjunction
with the statements under "Description of the Senior Debt Securities" in the
accompanying Prospectus which the following information supplements and, to the
extent inconsistent therewith, supersedes. Capitalized terms not defined in this
Prospectus Supplement are used as defined or otherwise provided in the
accompanying Prospectus.

<TABLE>
<S> <C>
NOTES OFFERED..................... $[50] million principal amount of Senior Secured Notes,
% due .

MATURITY..........................

INTEREST RATE..................... The Notes will bear interest at the rate of % per
annum.

INTEREST PAYMENT DATES............

OPTIONAL REDEMPTION............... The Notes will [not] be redeemable[ on or after ,
] at the option of the Company [, in whole at any
time or in part from time to time, at a redemption price
equal to 100% of principal, plus accrued interest to the
date of redemption]. The Notes have no sinking fund
provisions.

RANKING........................... Until the Release Date, all of the Notes will be secured
by a series of Collateral Bonds issued and delivered by
the Company to the Senior Trustee. On the Release Date,
the Notes will cease to be secured by Collateral Bonds
and will at the option of the Company either be secured
by a substitute mortgage indenture or become unsecured
general obligations of the Company on a parity with
other senior unsecured indebtedness of the Company.

CERTAIN COVENANTS................. The Notes will be issued under the Senior Indenture
which contains covenants that, among other things, limit
the ability of the Company to incur certain additional
liens or engage in certain sale-leaseback transactions
following the Release Date.

USE OF PROCEEDS................... The proceeds from the Notes will be added to the general
funds of the Company and be applied [to refund
outstanding short-term indebtedness of the Company and]
for other proper corporate purposes.

FORM AND DENOMINATION............. The Notes will initially be represented by a Global Note
registered in the name of a nominee of The Depository
Trust Company.
</TABLE>

S-2
<PAGE>
SUMMARY FINANCIAL INFORMATION

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30
---------------------------------- ----------------------
1995 1996 1997 1997 1998
---------- ---------- ---------- ---------- ----------
UNAUDITED
<S> <C> <C> <C> <C> <C>
STATEMENT OF INCOME DATA
Operating Revenues (000)........................... $ 663,693 $ 701,863 $ 690,478 $ 515,059 $ 485,733
Operating Income (000)............................. $ 78,756 $ 80,494 $ 79,321 $ 59,976 $ 59,584
Net Income (000)................................... $ 59,238 $ 60,390 $ 64,742 $ 48,230 $ 46,756

CAPITALIZATION AT SEPTEMBER 30, 1998
</TABLE>

<TABLE>
<CAPTION>
AS AS ADJUSTED
AMOUNT ADJUSTED(a) PERCENTAGE
---------- ----------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Long-term Debt(b).......................................................... $ 255,508 $ 305,508 35.5%
Preferred Stock (without mandatory redemption provisions).................. 51,200 51,200 6.0%
Common Stock Equity(b)..................................................... 502,485 502,485 58.5%
---------- ----------- -----
Total Capitalization............................................... $ 809,193 $ 859,193 100.0%
---------- ----------- -----
---------- ----------- -----
</TABLE>

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(a) Adjusted to reflect the issuance of $50,000,000 of the Notes.

(b) Long-term debt is increased by $7,848,000 and common stock equity is reduced
by the same amount to reflect the Company's guaranty of bank loans to the
Company's ESOP (Employee Stock Ownership Plan).

RATIOS OF EARNINGS TO FIXED CHARGES (UNAUDITED) (a)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
- ----------------------------------------------------- NINE MONTHS ENDED
1993 1994 1995 1996 1997 SEPTEMBER 30, 1998
- --------- --------- --------- --------- --------- ---------------------
<S> <C> <C> <C> <C> <C>
4.43 4.21 4.17 4.25 4.34 4.62
</TABLE>

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(a) In computing the ratios, earnings represent income before interest expense,
amortization of debt discount, premium and expense, federal and state income
taxes, and the allowance for borrowed funds used during construction and the
estimated interest component of rentals. Fixed charges represent interest
expense, amortization of debt discount, premium and expense and the
estimated interest component of rentals.

BOOK-ENTRY ISSUANCE--THE DEPOSITORY TRUST COMPANY

The Depository Trust Company ("DTC") will act as securities depositary (the
"Depositary") for the Notes. The Notes will initially be issued only as
fully-registered securities registered in the name of Cede & Co. (DTC's
partnership nominee). One or more fully-registered global certificates
representing the total aggregate principal amount of the Notes will be issued
and will be deposited with the Senior Trustee as custodian for DTC.

The laws of some jurisdictions require that certain purchasers of securities
take physical delivery of securities in definitive form. Such laws may impair
the ability to transfer beneficial interests in the Notes as represented by a
global certificate.

For additional information relating to DTC and the book-entry issuance
system, see "Senior Debt Securities--Book-Entry Securities" in the accompanying
Prospectus.

S-3
<PAGE>
UNDERWRITING

Subject to the terms and conditions set forth in the Underwriting Agreement,
the Company has agreed to sell to each of the Underwriters named below, and each
of the Underwriters has severally agreed to purchase, the respective principal
amounts of the Senior Secured Notes % Series Due set forth opposite
its name below:

<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
UNDERWRITER NOTES
- ------------------------------------------------------------------------------ --------------
<S> <C>
Salomon Smith Barney, Inc..................................................... $
A.G. Edwards & Sons, Inc...................................................... $
Legg Mason Wood Walker, Incorporated.......................................... $
--------------
Total................................................................. $
--------------
--------------
</TABLE>

Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all the Notes, if any are taken.
The Underwriters propose to offer the Notes in part directly to purchasers at
the initial public offering price set forth on the cover page of this Prospectus
Supplement and in part to certain securities dealers at such price less a
concession of % of the principal amount of the Notes. The Underwriters may
allow, and such dealers may reallow, a concession not to exceed % of the
principal amount of the Notes to certain brokers and dealers. After the Notes
are released for sale to the public, the offering price and other selling terms
may from time to time be varied by the Underwriters.

The Notes constitute a new issue of securities with no established trading
market. The Company has been advised by the Underwriters that they intend to
make a market in the Notes but are not obligated to do so and may discontinue
market marking at any time without notice. No assurance can be given as to the
liquidity of the trading market for the Notes.

The Underwriters are permitted to engage in certain transactions that
maintain or affect the price of the Notes. Such transactions may include
over-allotment transactions and purchases to cover short positions created by
the Underwriters in connection with the offering. If the Underwriters create a
short position in the Notes in connection with the offering (I.E., if they sell
Notes in an aggregate principal amount that exceeds the amount set forth on the
cover page of this Prospectus Supplement), the Underwriters may reduce that
short position by purchasing Notes in the open market. In general, purchases of
a security to reduce a short position could cause the price of the security to
be higher than it might be in the absence of such purchases.

Neither the Company nor the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the Notes. In addition, neither the
Company nor the Underwriters makes any representation that the Underwriters will
engage in such transactions or that such transactions, once commenced, will not
be discontinued without notice.

Certain of the Underwriters and their affiliates have engaged and in the
future may engage in investment banking transactions with, and the provision of
services to, the Company and its affiliates in the ordinary course of business.

The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.

S-4
<PAGE>
$102,000,000

WISCONSIN PUBLIC SERVICE CORPORATION

SENIOR DEBT SECURITIES

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

Wisconsin Public Service Corporation intends to offer up to $102,000,000 of
one or more series of its Senior Debt Securities at such times and on such terms
as the Company may determine in the light of market conditions and other
factors. The Senior Debt Securities will be secured by a pledge of first
mortgage bonds issued under the Company's Mortgage Indenture. This pledge will
remain in effect so long as there are other first mortgage bonds of the Company
outstanding. Upon the retirement of all other first mortgage bonds, the pledge
will be released. The specific designation, aggregate principal amount, purchase
price, maturity, rate and time of payment of interest, and the redemption terms
or other specific terms of the Senior Debt Securities will be set forth in an
accompanying Prospectus Supplement, together with the terms of offering of the
Senior Debt Securities. See also "Description of the Senior Debt Securities."

The Company may sell the Senior Debt Securities to or through underwriters
and also may sell the Senior Debt Securities directly to other purchasers or
through agents. The Prospectus Supplement will set forth the names of any
underwriters or agents involved in the sale of the Senior Debt Securities, the
principal amounts to be purchased by underwriters and the compensation of such
underwriters or agents.

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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

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

THE DATE OF THIS PROSPECTUS IS , 1998.
<PAGE>
AVAILABLE INFORMATION

Wisconsin Public Service Corporation (the "Company") is subject to the
informational requirements of the Securities Exchange Act of 1934 and in
accordance therewith files reports and other information with the Securities and
Exchange Commission (the "Commission"). Reports and other information may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at
the Commission's Regional Offices, located at Suite 1400, Citicorp Center, 500
West Madison Street, Chicago, Illinois 60661 and at 13th Floor, Seven World
Trade Center, New York, New York 10048. Copies of such material may be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. In addition, because the Company
files joint reports with its parent WPS Resources Corporation ("WPSR"), reports
concerning the Company can be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005 and the Chicago Stock
Exchange, 440 South LaSalle Street, Chicago, Illinois 60605, on which exchanges
WPSR common stock is listed. Such information may also be accessed
electronically by means of the SEC home page on the world wide web located at
http:www.sec.gov.

The Company has filed with the Commission a registration statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
Registration Statement) under the Securities Act of 1933, as amended (the
"Act"). The Prospectus does not contain all of the information set forth in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission. For further information, reference
is hereby made to the Registration Statement and the exhibits thereto. Any
statements contained herein concerning the provisions of any document filed as
an exhibit to the Registration Statement or otherwise filed with the Commission
or incorporated by reference herein are not necessarily complete, and, in each
instance, reference is made to the copy of such document so filed for a more
complete description of the matter involved. Each such statement is qualified in
its entirety by such reference.
------------------------

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents filed by the Company with the Commission are
incorporated herein by reference:

1. The Company's Annual Report on Form 10-K for the year ended December
31, 1997.

2. The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1998, June 30, 1998 and September 30, 1998.

3. The Company's Current Reports on Form 8-K filed June 11, 1998, July
22, 1998, and October 6, 1998.

All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 subsequent to the date of this
Prospectus and prior to the termination of this offering shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document, which
also is or is deemed to be incorporated by reference herein, modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus.

The Company undertakes to provide without charge to each person to whom a
copy of this Prospectus has been delivered, on the written or oral request of
any such person, a copy of any or all of the documents referred to above which
have been or may be incorporated in this Prospectus by reference, other than
exhibits to such documents. Requests for such copies should be directed to
Francis J. Kicsar, Secretary, Wisconsin Public Service Corporation, 700 North
Adams Street, P.O. Box 19001, Green Bay, Wisconsin 54307-9001, telephone number
(920) 433-1466.

2
<PAGE>
SUMMARY INFORMATION

The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this Prospectus or in the Prospectus
Supplement or in the financial statements or other documents incorporated in
this Prospectus by reference.

THE OFFERING

<TABLE>
<S> <C>
COMPANY........................... Wisconsin Public Service Corporation

SECURITIES BEING OFFERED.......... Not exceeding $102,000,000 Senior Debt Securities
</TABLE>

THE COMPANY

<TABLE>
<S> <C>
BUSINESS.......................... Electric and gas utility

SERVICE AREA...................... Approximately 11,000 square miles in northeastern
Wisconsin and an adjacent part of upper Michigan

SOURCE OF REVENUES FOR THE YEAR
ENDED DECEMBER 31, 1997......... 69.4% Electric; 30.6% Gas

CUSTOMERS AT DECEMBER 31, 1997.... Electric-374,516; Gas-218,299

SOURCES OF ELECTRIC GENERATION IN
1997............................ 68.9% Coal; 8.2% Nuclear; 3.0% Hydro; 19.9% Other
Generation and Purchased Power
</TABLE>

RATIOS OF EARNINGS TO FIXED CHARGES (UNAUDITED) (a)

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

3
<PAGE>
THE COMPANY

The Company is a wholly-owned subsidiary of WPS Resources Corporation, Green
Bay, Wisconsin ("WPSR"). The Senior Debt Securities offered pursuant to this
Prospectus, however, are the obligation solely of the Company, and WPSR is not
obligated to make any payments of principal or interest on the Senior Debt
Securities.

The Company is engaged in the production, transmission, distribution and
sale of electricity and in the purchase, distribution, transportation and sale
of gas in northeastern Wisconsin and an adjacent part of upper Michigan. It was
incorporated under the laws of the State of Wisconsin in 1883. Its executive
offices are at 700 North Adams Street, P.O. Box 19001, Green Bay, Wisconsin
54307. Its telephone number is (920) 433-1598.

The Company's Wisconsin retail utility rates and service and the issuance of
securities by the Company are regulated by the Public Service Commission of
Wisconsin ("PSCW"). The Company's Michigan retail utility rates and service are
regulated by the Michigan Public Service Commission. The Company's wholesale
electric rates, hydroelectric projects and certain other matters are regulated
by the Federal Energy Regulatory Commission. The operation of the Kewaunee
nuclear plant, of which the Company is the operator and currently a 41.2% owner,
is regulated by the Federal Nuclear Regulatory Commission. It is anticipated
that the Company's ownership interest in the Kewaunee plant will increase to 59%
in 2000. The Company is also subject to limited regulation by local authorities.

USE OF PROCEEDS

The proceeds from the sale of the Senior Debt Securities will be used to
refund outstanding short-term indebtedness and, if necessary or desirable to
achieve greater flexibility to meet industry restructuring requirements, may be
used to redeem or repurchase any or all of the following series of the Company's
Preferred Stock: 5.00%, 5.04%, 5.08%, 6.76%, 6.88%. Any remaining proceeds will
be used for other proper corporate purposes.

DESCRIPTION OF THE SENIOR DEBT SECURITIES

GENERAL: The Company will issue from time to time, in one or more series,
Senior Debt Securities under a trust indenture dated as of December 1, 1998
between the Company and Firstar Bank Milwaukee, N.A., National Association, as
trustee (the "Senior Trustee"), as supplemented and amended by supplemental
indentures thereto (collectively the "Senior Indenture"). The form of the Senior
Indenture is an exhibit to the Registration Statement.

The description of the offered Senior Debt Securities in the attached
Prospectus Supplement modifies the following description. Please read both
descriptions. The following statements are brief summaries of certain provisions
of the Senior Indenture. Such statements do not purport to be complete and in
each case are qualified in their entirety by the more detailed provisions of the
Senior Indenture, which is incorporated herein by reference. Capitalized terms
used in this section and not otherwise defined herein have the meanings given to
them in the Senior Indenture.

Until the Release Date (as defined below) the Senior Debt Securities will be
secured by one or more series of the Company's first mortgage bonds (the "First
Mortgage Bonds") issued under the first mortgage and deed of trust dated January
1, 1941 from the Company to First Wisconsin Trust Company (subsequently merged
into Firstar Bank Milwaukee, N.A., National Association), Milwaukee, Wisconsin
("Firstar" or the "Mortgage Trustee") as supplemented and amended by the
supplemental indentures thereto (collectively, the "Mortgage Indenture"). See
"--Security; Release Date." Any First Mortgage Bonds issued as security for
Senior Debt Securities will be issued and delivered to the Senior Trustee and
are referred to in this Prospectus as "Collateral Bonds."

4
<PAGE>
ON THE RELEASE DATE (AS DEFINED BELOW), THE SENIOR DEBT SECURITIES WILL
CEASE TO BE SECURED BY THE COLLATERAL BONDS AND, AT THE COMPANY'S OPTION, EITHER
(i) WILL BECOME UNSECURED GENERAL OBLIGATIONS OF THE COMPANY OR (ii) WILL BE
SECURED BY FIRST MORTGAGE BONDS (THE "SUBSTITUTED COLLATERAL BONDS") ISSUED
UNDER A MORTGAGE INDENTURE OTHER THAN THE MORTGAGE INDENTURE. The Senior
Indenture provides that, in addition to the Senior Debt Securities offered
hereby, additional Senior Debt Securities may be issued thereunder, without
limitation as to aggregate principal amount, from time to time, in one or more
series, provided that, prior to the Release Date, the amount of Senior Debt
Securities that may be issued cannot exceed the aggregate principal amount of
Collateral Bonds that the Company is able to issue under the Mortgage Indenture.

There is no requirement, under either the Senior Indenture or the Mortgage
Indenture (collectively, the "Indentures"), that future issues of debt
securities of the Company be issued under the Indentures, and, subject to
certain restrictions following the Release Date which are described in
"Description of the Senior Debt Securities--Restrictions," the Company will be
free to employ other indentures or documentation, containing provisions
different from those included in the Indentures, in connection with future
issues of such other debt securities.

The Indentures do not contain any debt covenants or provisions which would
afford holders of Senior Debt Securities protection in the event of a highly
leveraged transaction.

Please refer to the Prospectus Supplement relating to the Senior Debt
Securities being offered (the "Offered Senior Debt Securities") for, among other
things, the following terms thereof:

- the title of the Offered Senior Debt Securities;

- any limit on the aggregate principal amount of the Offered Senior Debt
Securities;

- the date on which the Offered Senior Debt Securities will mature;

- the rate or rates per annum (which may be fixed or variable) at which the
Offered Senior Debt Securities will bear interest or the method by which
such rate or rates shall be determined;

- the date from which interest will accrue or the method by which such date
shall be determined;

- the dates on which such interest will be payable and the Regular Record
Dates for such Interest Payment Dates;

- the dates, if any, on which, and the price or prices at which, the Offered
Senior Debt Securities may, pursuant to any mandatory or optional sinking
fund provisions, be redeemed by the Company and other detailed terms and
provisions of such sinking funds;

- the date, if any, after which, and the price or prices at which, the
Offered Senior Debt Securities may, pursuant to any optional redemption
provisions, be redeemed at the option of the Company or of the Holder
thereof and other detailed terms and provisions of such optional
redemption; and

- any other terms of the Offered Senior Debt Securities.

The following activities relating to the Senior Debt Securities will occur
at the office of the Senior Trustee in Milwaukee, Wisconsin:

- payment of principal and interest

- exchange, transfer and registration of certificated Senior Debt
Securities.

At its option, the Company may pay interest by check mailed or by wire
transfer to the registered holder.

5
<PAGE>
The Offered Senior Debt Securities will be represented either by Global
Securities registered in the name of a depositary, or its nominee, or by
certificates in certificated form issued to the registered holders thereof as
set forth in the applicable Prospectus Supplement. See "--Book Entry Securities"
herein.

DEFINITIONS: For purposes of the descriptions of the Senior Debt
Securities, certain defined terms have the following meanings:

"Capitalization" means the total of all the following items appearing on, or
included in, the consolidated balance sheet of the Company; (i) liabilities for
indebtedness maturing more than twelve (12) months from the date of
determination; and (ii) common stock, preferred stock, Hybrid Preferred
Securities (as defined in the Senior Indenture), premium on capital stock,
capital surplus, capital in excess of par value, and retained earnings (however
the foregoing may be designated), less, to the extent not otherwise deducted,
the cost of shares of capital stock of the Company held in its treasury.

"Debt" means any outstanding debt for money borrowed evidenced by notes,
debentures, bonds or other securities or guarantees of any thereof.

"Net Tangible Assets" means the amount shown as total assets on the
consolidated balance sheet of the Company, less the following: (i) intangible
assets including, but without limitation, such items as goodwill, trademarks,
trade names, patents, and unamortized debt discount and expense and (ii)
appropriate adjustments, if any, on account of minority interests. Net Tangible
Assets shall be determined in accordance with generally accepted accounting
principles and practices applicable to the type of business in which the Company
is engaged and that are approved by the independent accountants regularly
retained by the Company, and may be determined as of a date not more than sixty
(60) days prior to the happening of the event for which such determination is
being made.

"Operating Property" means (i) any interest in real property owned by the
Company and (ii) any asset owned by the Company that is depreciable in
accordance with GAAP, excluding, in either case, any interest of the Company as
lessee under any lease (except for a lease that results from a Sale and
Lease-Back Transaction) which has been or would be capitalized on the books of
the lessee in accordance with GAAP.

"Sale and Lease-Back Transaction" means any arrangement with any person
providing for the leasing to the Company of any Operating Property (except for
leases for a term, including any renewal thereof, of not more than 48 months),
which Operating Property has been or is to be sold or transferred by the Company
to such person; PROVIDED, HOWEVER, Sale and Lease-Back Transaction shall not
include any arrangement first entered into prior to the date of the Indenture
and shall not include any transaction pursuant to which the Company sells
Operating Property to, and thereafter purchases energy or services from, any
entity which transaction is ordered or authorized by any regulatory authority
having jurisdiction over the Company or its operations or is entered into
pursuant to any plan or program of industry restructuring ordered or authorized
by any such regulatory authority.

"Value" means, with respect to a Sale and Lease-Back Transaction, as of any
particular time, the amount equal to the greater of (i) the net proceeds to the
Company from the sale or transfer of the property leased pursuant to such Sale
and Lease-Back Transaction or (ii) the net book value of such property, as
determined in accordance with generally accepted accounting principles by the
Company at the time of entering into such Sale and Lease-Back transaction, in
either case multiplied by a fraction, the numerator of which shall be equal to
the number of full years of the term of the lease that is part of such Sale and
Lease-Back Transaction remaining at the time of determination and the
denominator of which shall be equal to the number of full years of such term,
without regard, in any case, to any renewal or extension options contained in
such lease.

ORIGINAL ISSUE DISCOUNT SECURITIES. The Senior Debt Securities may be
issued under the Senior Indenture as Original Issue Discount Securities to be
offered and sold at a substantial discount below their principal amount. Special
federal income tax, accounting and other considerations applicable to any such
Original Issue Discount Securities will be described in any Prospectus
Supplement relating thereto.

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"Original Issue Discount Security" means any security which provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the maturity thereof as a result of the
occurrence of an Event of Default and the continuation thereof.

SECURITY; RELEASE DATE. Until the Release Date (as defined below), the
Senior Debt Securities will be secured by one or more series of the Collateral
Bonds issued and delivered by the Company to the Senior Trustee. See
"Description of the First Mortgage Bonds." Upon the issuance of Senior Debt
Securities prior to the Release Date, the Company will simultaneously issue and
deliver Collateral Bonds to the Senior Trustee, as security for such Senior Debt
Securities. Such Collateral Bonds will have the same stated rate or rates of
interest (or interest calculated in the same manner), interest payment dates,
stated maturity date and redemption provisions, and will be in the same
aggregate principal amount as the Senior Debt Securities being issued. The
Company has agreed to issue a Related Series of Collateral Bonds in the name of
the Senior Trustee in its capacity as trustee under the Senior Indenture
concurrently with the issuance of each series of Senior Debt Securities. The
Senior Trustee has agreed to hold each series of Collateral Bonds in such
capacity under all circumstances and not transfer such Collateral Bonds until
the earlier of the Release Date or the prior retirement of the Related Series of
Senior Debt Securities through redemption, repurchase or otherwise. Prior to the
Release Date, the Company shall make payments of the principal of, and premium
or interest on, each series of Collateral Bonds to the Senior Trustee, which
payments shall be applied by the Senior Trustee to satisfaction of all
obligations then due on the Related Series of Senior Debt Securities.

THE "RELEASE DATE" WILL BE THE DATE THAT ALL FIRST MORTGAGE BONDS OF THE
COMPANY ISSUED AND OUTSTANDING UNDER THE MORTGAGE INDENTURE, OTHER THAN THE
COLLATERAL BONDS, HAVE BEEN RETIRED (AT, BEFORE OR AFTER THE MATURITY THEREOF)
THROUGH PAYMENT, REDEMPTION OR OTHERWISE, PROVIDED THAT NO DEFAULT OR EVENT OF
DEFAULT UNDER THE SENIOR INDENTURE HAS OCCURRED AND IS CONTINUING. ON THE
RELEASE DATE, THE SENIOR TRUSTEE WILL DELIVER TO THE COMPANY FOR CANCELLATION
ALL COLLATERAL BONDS AND NOT LATER THAN 30 DAYS AFTER THE RELEASE DATE WILL
PROVIDE NOTICE TO ALL HOLDERS OF SENIOR DEBT SECURITIES OF THE OCCURRENCE OF THE
RELEASE DATE. AS A RESULT, ON THE RELEASE DATE, THE COLLATERAL BONDS WILL CEASE
TO SECURE THE SENIOR DEBT SECURITIES, AND, AT THE OPTION OF THE COMPANY, THE
SENIOR DEBT SECURITIES, EITHER (i) WILL BECOME UNSECURED GENERAL OBLIGATIONS OF
THE COMPANY OR (ii) WILL BE SECURED BY SUBSTITUTED COLLATERAL BONDS. EACH ISSUE
OF COLLATERAL BONDS WILL BE SECURED BY A LIEN ON CERTAIN PROPERTY OWNED BY THE
COMPANY. IN CERTAIN CIRCUMSTANCES PRIOR TO THE RELEASE DATE, THE COMPANY IS
PERMITTED TO REDUCE THE AGGREGATE PRINCIPAL AMOUNT OF A SERIES OF COLLATERAL
BONDS HELD BY THE SENIOR TRUSTEE, BUT IN NO EVENT TO AN AMOUNT LOWER THAN THE
AGGREGATE OUTSTANDING PRINCIPAL AMOUNT OF THE SENIOR DEBT SECURITIES INITIALLY
ISSUED CONTEMPORANEOUSLY WITH SUCH COLLATERAL BONDS. FOLLOWING THE RELEASE DATE,
THE COMPANY WILL CAUSE THE MORTGAGE INDENTURE TO BE DISCHARGED, AND THE COMPANY
WILL NOT ISSUE ANY ADDITIONAL BONDS UNDER SUCH MORTGAGE INDENTURE.

RESTRICTIONS. The Senior Indenture provides that the Company shall not
consolidate with, merge with or into any other corporation (whether or not the
Company shall be the surviving corporation), or sell, assign, transfer or lease
all or substantially all of its properties and assets as an entirety or
substantially as an entirety to any Person or group of affiliated Persons, in
one transaction or a series of related transactions, unless: (1) either the
Company shall be the continuing Person or the Person (if other than the Company)
formed by such consolidation or with which or into which the Company is merged
or the Person (or group of affiliated Persons) to which all or substantially all
the properties and assets of the Company are sold, assigned, transferred or
leased is a corporation (or constitute corporations) and expressly assumes, by
an indenture supplemental to the Senior Indenture, all the obligations of the
Company under the Senior Debt Securities and the Senior Indenture, executed and
delivered to the Senior Trustee in form satisfactory to the Senior Trustee, and
expressly assumes, by an indenture supplemental to the Mortgage Indenture (if
prior to the Release Date) or any Substituted Mortgage Indenture (if on or after
the Release Date) all of the obligations of the Company under any outstanding
Collateral Bonds or Substituted Collateral Bonds and under the Mortgage
Indenture or Substituted Mortgage Indenture, executed and delivered to the
Mortgage Trustee or the trustee under the Substituted Mortgage Indenture in form

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satisfactory to the Mortgage Trustee or the trustee under the Substituted
Mortgage Indenture; (2) immediately before and after giving effect to such
transaction or series of transactions, no Event of Default, and no Default, with
respect to the Senior Debt Securities shall have occurred and be continuing; and
(3) the Company shall have delivered to the Senior Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and such supplemental indentures comply with the Senior
Indenture, the Mortgage Indenture or the Substituted Mortgage Indenture, as the
case may be.

LIMITATION ON LIENS. The Senior Indenture provides that, so long as any
Senior Debt Securities are outstanding, the Company may not issue, assume,
guarantee or permit to exist after the Release Date any Debt that is secured by
any mortgage, security interest, pledge or lien ("Lien") of or upon any
Operating Property of the Company, whether owned at the date of the Senior
Indenture or thereafter acquired, without in any such case effectively securing
the Senior Debt Securities (together with, if the Company shall so determine,
any other indebtedness of the Company ranking equally with the Senior Debt
Securities) equally and ratably with such Debt (but only so long as such Debt is
so secured).

The foregoing restriction will not apply to:

- Liens on any Operating Property existing at the time of its acquisition
(which Liens may also extend to subsequent repairs, alterations and
improvements to such Operating Property);

- Liens on Operating Property of a corporation existing at the time such
corporation is merged into, or consolidated with, or such corporation
disposes of its properties (or those of a division) as or substantially as
an entirety to, the Company;

- Liens on Operating Property to secure the cost of acquisition,
construction, development or substantial repair, alteration or improvement
of property or to secure indebtedness incurred to provide funds for any
such purpose or for reimbursement of funds previously expended for any
such purpose, provided such Liens are created or assumed contemporaneously
with, or within 18 months after, such acquisition or the completion of
substantial repair or alteration, construction, development or substantial
improvement;

- Liens in favor of any State or any department, agency or instrumentality
or political subdivision of any State, or for the benefit of holders of
securities issued by any such entity (or providers of credit enhancement
with respect to such securities), to secure any Debt (including, without
limitation, obligations of the Company with respect to industrial
development, pollution control or similar revenue bonds) incurred for the
purpose of financing all or any part of the purchase price or the cost of
substantially repairing or altering, constructing, developing or
substantially improving Operating Property of the Company;

- Any Lien created by any Substituted Mortgage Indenture securing
Substituted Collateral Bonds; or

- Any extension, renewal or replacement (or successive extensions, renewals
or replacements), in whole or in part, of any Lien referred to in the
foregoing exceptions, provided, however, that the principal amount of Debt
secured thereby and not otherwise authorized by the foregoing exception,
shall not exceed the principal amount of Debt, plus any premium or fee
payable in connection with any such extension, renewal or replacement, so
secured at the time of such extension, renewal or replacement.

In addition, the foregoing restriction will not apply to the issuance,
assumption or guarantee by the Company of Debt secured by a Lien which would
otherwise be subject to the foregoing restriction up to an aggregate amount
which, together with all other secured Debt of the Company (not including
secured Debt permitted under any of the foregoing exceptions) and the Value of
Sale and Lease-Back Transactions existing at such time (other than Sale and
Lease-Back Transactions the proceeds of which have been applied to the
retirement of certain indebtedness, Sale and Lease-Back Transactions in which
the property involved would have been permitted to be subjected to a Lien under
any of the foregoing exceptions and Sale and Lease-Back Transactions that are
permitted by the first sentence of "Limitations on Sale and

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Lease-Back Transactions" below), does not exceed the greater of 10% of the Net
Tangible Assets or 10% of Capitalization.

LIMITATIONS ON SALE AND LEASE-BACK TRANSACTIONS. The Senior Indenture
provides that so long as the Senior Debt Securities are outstanding, the Company
may not enter into or permit to exist after the Release Date any Sale and
Lease-Back Transaction with respect to any Operating Property (except for
transactions involving leases for a term, including renewals, of not more than
48 months), if the purchaser's commitment is obtained more than 18 months after
the later of the completion of the acquisition, construction or development of
such Operating Property or the placing in operation of such Operating Property
or of such Operating Property as constructed or developed or substantially
repaired, altered or improved. This restriction will not apply if (a) the
Company would be entitled pursuant to any of the provisions described in the
second paragraph under "Limitation on Liens" above to issue, assume, guarantee
or permit to exist Debt secured by a Lien on such Operating Property without
equally and ratably securing the Senior Debt Securities, (b) after giving effect
to such Sale and Lease-Back Transaction, the Company could incur pursuant to the
provisions described in the third paragraph under "Limitation on Liens," at
least $1.00 of additional Debt secured by Liens (other than Liens permitted by
clause (a)) or (c) the Company applies within 180 days an amount equal to, in
the case of a sale or transfer for cash, the net proceeds (not exceeding the net
book value), and, otherwise, an amount equal to the fair value (as determined by
its Board of Directors) of the Operating Property so leased to the retirement of
Senior Debt Securities or other Debt of the Company ranking equally with, the
Senior Debt Securities, subject to reduction for Senior Debt Securities and such
Debt retired during such 180-day period otherwise than pursuant to mandatory
sinking fund or prepayment provisions and payments at stated maturity.

EVENTS OF DEFAULT AND NOTICE THEREOF. The following are Events of Default
under the Senior Indenture with respect to the Senior Debt Securities of any
series;

- failure to pay interest on any Senior Debt Security when due and

(1) if such failure occurs prior to the Release Date, continued for 90
days, or

(2) if such failure occurs on or after the Release Date, continued for
30 days;

- failure to pay the principal of (or premium, if any, on) any Senior Debt
Security when due and payable at Maturity, upon redemption or otherwise;

- failure to observe or perform any other covenant, warranty or agreement
contained in the Senior Debt Securities of that series or in the Senior
Indenture (other than a covenant, agreement or warranty included in the
Senior Indenture solely for the benefit of Senior Debt Securities other
than that series) and

(1) if such failure occurs prior to the Release Date, continued for 90
days, or

(2) if such failure occurs on or after the Release date, continued for
60 days,

in each case, after notice has been given to the Company by the Trustee or
Holders of at least 25% in aggregate principal amount of the Outstanding
Senior Debt Securities of that series;

- prior to the Release Date, the occurrence and continuance of a completed
default under the Mortgage Indenture, PROVIDED, HOWEVER, the waiver or
cure of such completed default under the Mortgage Indenture and the
rescission and annulment of the consequences thereof under the Mortgage
Indenture will constitute a waiver of the corresponding Event of Default
under the Senior Indenture;

- if any Substituted Collateral Bonds are outstanding, the occurrence and
continuance of an event of default or completed default under the
Substituted Mortgage, PROVIDED, HOWEVER, the waiver or cure of such event
of default or completed default under the Substituted Mortgage Indenture
and the rescission and annulment of the consequences thereof under the
Substituted Mortgage Indenture will constitute a waiver of the
corresponding Event of Default under the Senior Indenture;

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- certain events of bankruptcy, insolvency or reorganization relating to the
Company; and

- any other Event of Default with respect to the Senior Debt Securities of
that series specified in the Prospectus Supplement relating thereto or
Supplemental Indenture under which such series of Senior Debt Securities
is issued.

The Trustee shall, within 30 days after the occurrence of any Default or
Event of Default with respect to Senior Debt Securities of any series, give the
Holders of Senior Debt Securities of that series notice of all uncured Defaults
or Events of Default known to it (the term "Default" includes any event which
after notice or passage of time or both would be an Event of Default); provided,
however, that, except in the case of an Event of Default or a Default in payment
on any Senior Debt Securities of any series, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee of directors or responsible officers of the Trustee in good faith
determine that the withholding of such notice is in the interest of the Holders
of Senior Debt Securities of that series.

If an Event of Default with respect to Senior Debt Securities of any series
(other than due to events of bankruptcy, insolvency or reorganization) occurs
and is continuing, the Trustee or the Holders of at least 25% in aggregate
principal amount of the Outstanding Senior Debt Securities of that series, by
notice in writing to the Company (and to the Trustee if given by the Holders of
at least 25% in aggregate principal amount of the Senior Debt Securities of that
series) may declare the unpaid principal of and accrued interest to the date of
acceleration on all the Outstanding Senior Debt Securities of that series to be
due and payable immediately and, upon any such declaration, the Senior Debt
Securities of that series shall become immediately due and payable.

If an Event of Default occurs due to bankruptcy, insolvency or
reorganization, all unpaid principal of and accrued interest on the Outstanding
Senior Debt Securities of any series will become immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder of
any Senior Debt Security of that series. Upon any acceleration of the Senior
Debt Securities prior to the Release Date, the Senior Trustee is empowered to
cause the mandatory redemption of the Collateral Bonds or Substituted Collateral
Bonds, as the case may be.

The Holders of not less than a majority of the principal amount of the
Outstanding Senior Debt Securities of any series may rescind a declaration of
acceleration and its consequences with respect to the Senior Debt Securities of
such series (including if given, the written demand for redemption of Collateral
Bonds or Substituted Collateral Bonds) if all existing Events of Default, other
than the nonpayment of principal of and interest on the Senior Debt Securities
of that series that have become due solely by such declaration of acceleration,
have been cured or waived; to the extent lawful, interest on overdue interest
and on overdue principal that has become due otherwise than by reason of such
acceleration has been paid; the rescission would not conflict with any judgment
or decree of a court of competent jurisdiction; and all amounts due to the
Trustee under the Senior Indenture have been paid. The Senior Indenture provides
that the Company shall periodically file statements with the Trustee regarding
compliance by the Company with certain of the covenants thereof and shall
specify any Event of Default or Defaults with respect to Senior Debt Securities,
in performing such covenants, of which the signers may have knowledge.

MODIFICATION OF THE SENIOR INDENTURE; WAIVER. The Company and the Trustee
without the consent of any Holders may modify the Senior Indenture with respect
to certain matters, including (i) to cure any ambiguity, defect or inconsistency
or to correct or supplement any provision which may be inconsistent with any
other provision of the Senior Indenture and (ii) to make any change that does
not materially adversely affect the interests of any Holder of Senior Debt
Securities of any series. In addition, the Company and the Trustee may modify
certain rights and obligations of the Company and the rights of Holders of the
Senior Debt Securities with the written consent of the Holders of at least a
majority in aggregate principal amount of the Outstanding Senior Debt Securities
of each series affected thereby.

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None of the following modifications, however, will be effective against any
holder of any outstanding Senior Debt Securities of any series affected thereby
without such Holder's consent:

- extension of the maturity or reduction of the principal amount of any
Senior Debt Securities or, reduction in the interest rate or extension of
the time for payment of interest,

- change in the optional redemption provisions in a manner adverse to any
Holder of Senior Debt Securities of such series,

- modification that would

- adversely impair the interest of the Senior Trustee in the Collateral
Bonds or Substituted Collateral Bonds held by it or,

- prior to the Release Date, reduce the principal amount of any issue of
Collateral Bonds securing the Senior Debt Securities of such series to
an amount less than the principal amount of the related issue of Senior
Debt Securities or

- alter the payment provisions of such Collateral Bonds or Substituted
Collateral Bonds in a manner adverse to the holders of the Senior Debt
Securities,

- other modification in the terms of payment of the principal of, or
interest on, such Senior Debt Securities of any series, or

- reduction of the percentage required for waivers of Defaults or Events of
Default under the Senior Indenture or for modifications of the Senior
Indenture

The Holders of not less than a majority in aggregate principal amount of the
Outstanding Senior Debt Securities of any series may on behalf of the Holders of
all Senior Debt Securities of that series waive any Event of Default or Default
under the Senior Indenture with respect to that series, except an Event of
Default or a Default in the payment of the principal of, or premium, if any, or
any interest on any Senior Debt Security of that series or in respect of a
provision which under the Senior Indenture cannot be modified or amended without
the consent of the Holder of each Outstanding Senior Debt Security of that
series affected.

DEFEASANCE. The Company may terminate its substantive obligations in
respect of the Senior Debt Securities of any series (except for its obligations
to pay the principal of (and premium, if any, on) and the interest on the Senior
Debt Securities of that series) by (i) depositing with the Trustee, under the
terms of an irrevocable trust agreement, money or U.S. Government Obligations
sufficient to pay all remaining indebtedness on the Senior Debt Securities of
that series, (ii) delivering to the Trustee either an Opinion of Counsel or a
ruling directed to the Trustee from the Internal Revenue Service to the effect
that the Holders of the Senior Debt Securities of that series will not recognize
income, gain or loss for federal income tax purposes as a result of such deposit
and termination of obligations, and (iii) complying with certain other
requirements set forth in the Senior Indenture.

VOTING OF COLLATERAL BONDS HELD BY SENIOR TRUSTEE. The Senior Trustee, as
holder of Collateral Bonds, will attend any meeting of holders of First Mortgage
Bonds under the Mortgage Indenture, as to which it receives due notice, or, at
its option, will deliver its proxy in connection therewith. Either at such
meeting, or otherwise where the consent of holders of First Mortgage Bonds is
sought without a meeting, the Senior Trustee will vote all of the Collateral
Bonds held by it, or will consent with respect thereto, as directed by the
holders of a majority in aggregate principal amount of the outstanding Senior
Debt Securities; provided, however, that the Senior Trustee shall not vote the
Collateral Bonds of any particular series in favor of, or give consent to, any
action which in the Trustee's opinion would materially adversely affect such
series of Collateral Bonds in a manner not shared generally by all other
Collateral Bonds, except upon notification by the Senior Trustee to the holders
of the related series of Senior Debt Securities of such proposal and consent
thereto of the holders of not less than a majority in principal amount of the
outstanding Senior Debt Securities of such series.

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CONCERNING THE SENIOR TRUSTEE. Firstar is the Senior Trustee under the
Senior Indenture. Firstar is also the Mortgage Trustee under the Mortgage
Indenture, a depositary of funds of the Company and the transfer agent for the
Company's Preferred Stock and for the Common Stock of its parent, WPSR. See
"Description of the First Mortgage Bonds--Concerning the Trustee."

BOOK-ENTRY SECURITIES. The Senior Debt Securities may be issued initially
in the form of one or more global securities under a book-entry only system
operated by a securities depositary. Unless otherwise specified in the
applicable Prospectus Supplement, the Depository Trust Company ("DTC"), New
York, NY, will act as securities depositary for each series of Senior Debt
Securities, which will be issued as fully-registered securities registered in
the name of CEDE & Co. (DTC's partnership nominee). Individual purchases of
Book-Entry Interests (as defined below) in any such Senior Debt Securities will
be made in book-entry form. Purchasers of Book-Entry Interests in such Senior
Debt Securities will not receive certificates representing their interests in
such Senior Debt Securities. So long as CEDE & Co., as nominee of DTC, is the
securityholder, references herein to holders of the Senior Debt Securities or
registered owners will mean CEDE & Co., rather than the owners of Book-Entry
Interests in Senior Debt Securities.

DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities deposited by its participants (the "DTC Participants") and
facilitates the settlement among DTC Participants of securities transactions
such as transfers and pledges of deposited securities through electronic
computerized book-entry changes in accounts of the DTC Participants, thereby
eliminating the need for physical movement of securities certificates. Direct
DTC Participants include securities brokers and dealers, banks, trust companies,
clearing corporations and certain other organizations. DTC is owned by a number
of the DTC Participants and by the New York Stock Exchange, Inc., the American
Stock Exchange, Inc. and the National Association of Securities Dealers, Inc.
Access to the DTC system is also available to others such as securities brokers
and dealers, banks and trust companies that clear through or maintain a
custodial relationship with a DTC Participant, either directly or indirectly
(the "Indirect Participants").

DTC Participants purchasing Book-Entry Interests in any Senior Debt
Securities will not receive certificates. Each DTC Participant will receive a
credit balance in the records of DTC in the amount of such DTC Participant's
interest in such Senior Debt Securities, which will be confirmed in accordance
with DTC's standard procedures. The ownership interest of each actual purchaser
of a Book-Entry Interest in Senior Debt Securities (the "Book-Entry Interests")
will be recorded through the records of the DTC Participant or through the
records of the Indirect Participant. Owners of Book-Entry Interests should
receive from the DTC Participant or Indirect Participant a written confirmation
of their purchase providing details of the Book-Entry Interests acquired.
Transfers of Book-Entry Interests will be accomplished by book entries made by
the DTC Participants or Indirect Participants who act on behalf of the owners of
Book-Entry Interests. Owners of Book-Entry Interests will not receive
certificates representing their ownership of Book-Entry Interests with respect
to any Senior Debt Securities except as described below upon the resignation of
DTC.

Under the Senior Indenture, payments made by the Trustee to DTC or its
nominee will satisfy the Company's obligations under the Senior Indenture to the
extent of the payments so made. Owners of Book-Entry Interests will not be or be
considered by the Company or the Trustee to be, and will not have any rights as,
holders of Senior Debt Securities under the Senior Indenture.

NEITHER THE COMPANY NOR THE TRUSTEE UNDER THE SENIOR INDENTURE WILL HAVE ANY
RESPONSIBILITY OR OBLIGATION TO ANY DTC PARTICIPANT, INDIRECT PARTICIPANT OR ANY
OWNER OF A BOOK-ENTRY INTEREST OR ANY OTHER

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PERSON NOT SHOWN ON THE REGISTRATION BOOKS OF SUCH TRUSTEE AS BEING A HOLDER OF
SENIOR DEBT SECURITIES WITH RESPECT TO: (1) ANY SENIOR DEBT SECURITIES; (2) THE
ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY DTC PARTICIPANT OR INDIRECT
PARTICIPANT; (3) THE PAYMENT BY DTC OR ANY DTC PARTICIPANT OR INDIRECT
PARTICIPANT OF ANY AMOUNT DUE TO ANY OWNER OF A BOOK-ENTRY INTEREST IN RESPECT
OF THE PRINCIPAL OR REDEMPTION PRICE OF OR INTEREST ON SUCH SENIOR DEBT
SECURITIES; (4) THE DELIVERY BY DTC OR ANY DTC PARTICIPANT OR INDIRECT
PARTICIPANT OF ANY NOTICE TO ANY OWNER OF A BOOK-ENTRY INTEREST WHICH IS
REQUIRED OR PERMITTED UNDER THE TERMS OF THE SENIOR INDENTURE TO BE GIVEN TO
HOLDERS OF SENIOR DEBT SECURITIES; (5) THE SELECTION OF THE OWNERS OF A
BOOK-ENTRY INTEREST TO RECEIVE PAYMENT IN THE EVENT OF ANY PARTIAL REDEMPTION OF
ANY SENIOR DEBT SECURITIES; OR (6) ANY CONSENT GIVEN OR OTHER ACTION TAKEN BY
DTC OR ITS NOMINEE AS HOLDER OF SENIOR DEBT SECURITIES.

Principal and redemption price of, and interest payments on, Senior Debt
Securities registered in the name of DTC or its nominee will be made to DTC or
such nominee, as registered owner of such Senior Debt Securities. DTC is
responsible for disbursing such payments to the appropriate DTC Participants and
such DTC Participants, and any Indirect Participants, are in turn responsible
for disbursing the same to the owners of Book-Entry Interests. Unless it has
reason to believe it will not receive payment, DTC's current practice is to
credit the accounts of the DTC Participants on a payment date in accordance with
their respective holdings shown on the records of DTC. Payments by DTC
Participants and Indirect Participants to owners of Book-Entry Interests will be
governed by standing 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 DTC Participant or
Indirect Participant and not of DTC, the Company or the Senior Trustee, subject
to any statutory and regulatory requirements as may be in effect from time to
time.

DTC Participants and Indirect Participants carry the "position" of the
ultimate Book-Entry Interest owner on their records, and will be responsible for
providing information to the ultimate Book-Entry Interest owner as to the Senior
Debt Securities in which the Book-Entry Interest is held, debt service payments
received, and other information. Each person for whom a DTC Participant or
Indirect Participant acquires an interest in Senior Debt Securities, as nominee,
may desire to make arrangements with such DTC Participant or Indirect
Participant to receive a credit balance in the records of such DTC Participant
or Indirect Participant, to have all notices of redemption or other
communications to or by DTC which may affect such persons forwarded in writing
by such DTC Participant or Indirect Participant, and to have notification made
of all debt service payments.

Purchases, transfers and sales of Book-Entry Interests by the ultimate
Book-Entry Interest owners may be made through book entries made by DTC
Participants or Indirect Participants or others who act for the ultimate
Book-Entry Interest owner. The Trustee under the Senior Indenture, the Company
and the underwriters, as such, have no role in those purchases, transfers or
sales.

The Senior Trustee will recognize and treat DTC (or any successor securities
depositary) or its nominee as the holder of Senior Debt Securities registered in
its name or the name of its nominee for all purposes, including payment of debt
service, notices, enforcement of remedies and voting. Under DTC's current
practice, a proxy will be given to the DTC Participants holding Book-Entry
Interests in Senior Debt Securities in connection with any matter on which
holders of such Senior Debt Securities are asked to vote or give their consent.
Crediting of debt service payments and transmittal of notices and other
communications by DTC to DTC Participants, by DTC Participants to Indirect
Participants and by DTC Participants and Indirect Participants to the ultimate
Book-Entry Interest owners are the responsibility of those persons and will be
handled by arrangements among them and are not the responsibility of the
Trustee, the Company or any underwriter, as such.

The Trustee, so long as a book-entry system is used for any series of Senior
Debt Securities, will send any notice of redemption and any other notices
required by the Senior Indenture to be sent to holders of such Senior Debt
Securities only to DTC (or such successor securities depositary) or its nominee.
Any

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failure of DTC to advise any DTC Participant, or of any DTC Participant or
Indirect Participant to notify the Book-Entry Interest owner, of any such notice
and its content or effect will not affect the validity of the redemption of the
Senior Debt Securities called for redemption, or any other action premised on
that notice. In the event of a call for redemption, the Trustee's notification
to DTC will initiate DTC's standard call process, and, in the event of a partial
call, its lottery process by which the call will be randomly allocated to DTC
Participants holding positions in the Senior Debt Securities to be redeemed.
When DTC and DTC Participants allocate the call for redemption, the owners of
the Book-Entry Interests that have been called should be notified by the broker
or other person responsible for maintaining the records of those interests and
subsequently credited by that person with the proceeds once such Senior Debt
Securities are redeemed.

The Company, the Trustee and any underwriter or agent cannot and do not give
any assurances that DTC, DTC Participants or others will distribute payments of
debt service on Senior Debt Securities made to DTC or its nominee as the
registered owner, or any redemption or other notices, to the Book-Entry Interest
owners, or that they will do so on a timely basis, or that DTC will serve and
act in the manner described in this Prospectus.

The Company understands that the current "Rules" applicable to DTC and DTC
Participants are on file with the Commission, and that the current "Procedures"
of DTC to be followed in dealing with DTC Participants are on file with DTC.

If DTC is at any time unwilling or unable to continue as depositary, and a
successor depositary is not appointed by the Company within 90 days, the Company
will issue individual certificates to owners of Book-Entry Interests in exchange
for the Senior Debt Securities held by DTC or its nominee, as the case may be.
In such instance, an owner of a Book-Entry Interest will be entitled to physical
delivery of certificates equal in principal amount to such Book-Entry Interest
and to have such certificates registered in its name. Individual certificates so
issued will be issued in denominations of $1,000 or any multiple thereof.

Neither the Company, the Senior Trustee nor any underwriter makes any
representation as to the accuracy of the above description of DTC's business,
organization and procedures, which is based upon information furnished by DTC.

DESCRIPTION OF FIRST MORTGAGE BONDS

GENERAL. Prior to the Release Date, any series of First Mortgage Bonds
issued as Collateral Bonds will be issued to the Senior Trustee. Each issue of
such Collateral Bonds to the Senior Trustee will be in a principal amount equal
to the principal amount of the Senior Debt Securities issued contemporaneously
with such Collateral Bonds. Prior to the Release Date, the Company shall make
payments of the principal of, and premium or interest on, each Series of
Collateral Bonds to the Senior Trustee, which payments shall be applied by the
Senior Trustee to satisfaction of all obligations then due on the related series
of Senior Debt Securities.

The following statements are brief summaries of certain provisions of the
Mortgage Indenture. Such statements do not purport to be complete and in each
case are qualified in their entirety by reference to the more detailed
provisions of the Mortgage Indenture. Capitalized terms used in this section and
not otherwise defined herein shall have the respective meanings given to them in
the Mortgage Indenture.

LIEN AND TITLES: The Collateral Bonds will be secured by the Mortgage
Indenture equally and ratably with all other bonds issued thereunder. At the
time of issuance of each series of the Collateral Bonds, the Company's counsel
will deliver its opinion that the Mortgage Indenture constitutes, except as
stated in this paragraph, a valid and direct first lien upon substantially all
of the real and fixed property and governmental licenses and permits owned by
the Company (including its interests as tenant-in-common), subject only to
permissible encumbrances and to the other limitations and exceptions stated as
to their opinion on titles

14
<PAGE>
below. Excepted from the lien are investments in other companies, items of the
general character such as would be included on the Balance Sheet as Current
Assets (unless deposited or required to be deposited with the Mortgage Trustee),
motor vehicles, advance payments for or other costs of nuclear fuel not situated
at the plant site, and timber and minor parcels of real estate. The term
"permissible encumbrances" includes liens upon transmission or distribution line
rights-of-way, and certain tax and other liens, easements or leases, and other
adverse interests of a nature or of such proportion as would not under ordinary
circumstances materially impair the lien of the Mortgage Indenture or the use of
the property.

The Mortgage Indenture by its terms also covers in general all
after-acquired property of the Company, other than property of the nature
excepted from the lien thereof as stated above. The lien on an after-acquired
system may be subject to a prior lien and, in case of merger, to possible
limitation to the system of the Company at that time.

At the time of issuance of each series of the Collateral Bonds, the
Company's counsel will deliver its opinion that the Company has good and
marketable title to the real and fixed properties described in the Mortgage
Indenture (other than properties disposed of and released thereunder and lands
described as held only under flowage rights) free and clear of all liens,
charges and encumbrances against the same prior to or on a party with the lien
of the Indenture, except for and subject only to "permissible encumbrances" and
to such exceptions, defects and qualifications as in such counsel's opinion do
not materially affect the security for the Collateral Bonds or the Company's
title to or its right to use such properties in the conduct of its business. The
opinion of counsel does not cover the validity of or title to easements or
rights-of-way for transmission and distribution lines.

The Mortgage Indenture does not prevent a merger or consolidation of the
Company, a sale by the Company of all or substantially all of its assets, a
recapitalization of the Company or other comparable transaction as long as (i)
the lien of the Mortgage Indenture and the rights and powers of the Mortgage
Trustee and the bondholders under the Mortgage Indenture are not impaired; (ii)
the principal amount of prior lien bonds secured by a prior lien or liens on
property of the successor corporation (exclusive of the property owned by the
Company immediately prior to the merger, consolidation or sale) and outstanding
immediately after such consolidation, merger or sale shall not exceed 60% of the
cost or fair value, whichever is less, of the property of the character of
permanent additions owned by the successor corporation, immediately prior to
such transaction; (iii) the earnings applicable to bond interest of the
successor corporation determined as provided in the Mortgage Indenture,
excluding net earnings of the Company, for a period of twelve consecutive
calendar months within the fifteen consecutive calendar months immediately
preceding the first day of the calendar month in which such consolidation,
merger or sale is made shall have been in the aggregate at least equal to twice
the interest requirements for a period of one year upon all prior lien bonds
secured by a prior lien or prior liens on the property of such successor
corporation and outstanding immediately after such transaction; and (iv) the
successor corporation assumes the obligations of the Company under the Mortgage
Indenture. If the foregoing conditions are satisfied with respect to any such
transaction, the Company may enter into such transaction. Although the Mortgage
Indenture limits the principal amount of additional bonds which may be issued,
it does not restrict the amount of unsecured debt that the Company may incur.
Except as hereinabove described, the Mortgage Indenture does not provide any
protection to the bondholder against a highly leveraged transaction however
structured.

OUTSTANDING AND ADDITIONAL BONDS: Under the Mortgage Indenture, there were
outstanding as of September 30, 1998, $234,175,000 principal amount of bonds of
various prior series. Additional bonds without limit as to aggregate amount may
be issued in a principal amount up to (a) 60% of the lesser of cost or fair
value of net permanent additions (electric, gas or steam property acquired after
January 1, 1941, less retirements after said date taken at undepreciated cost,
subject to certain adjustments) except permanent additions otherwise utilized
under the Mortgage Indenture or restricted under the terms of certain
supplemental indentures; (b) the amount of bonds retired or cancelled, except
from certain funds; and (c) the amount of cash deposited with the Mortgage
Trustee for the purpose, which cash may

15
<PAGE>
thereafter be withdrawn in lieu of the issuance of an equal amount of bonds
under clauses (a) or (b) but without any earnings' test requirement. Bonds may
be issued under clauses (a) and (c), and under certain circumstances under
clause (b), only if earnings applicable to bond interest for a period of 12
months within the preceding 15 months have been at least twice the annual
interest requirements upon all bonds then applied for and outstanding.

Earnings applicable to bond interest, as defined in the Mortgage Indenture,
for the twelve months ended September 30, 1998, were $117,622,637, resulting in
a ratio of 6.78 times the full annual interest requirements upon all bonds then
outstanding, and a ratio of 4.83 after issuance of $102,000,000 principal amount
of Collateral Bonds at an estimated weighted average interest rate of 6.85% per
annum. A difference of 0.125% in the assumed weighted average interest rate on
the Collateral Bonds would change the ratio approximately .025.

The aggregate amount of unbonded bondable property was approximately
$780,000,000 as of September 30, 1998, approximately $86,667,000 of which will
be applied as the basis for the issuance of approximately $52,000,000 of the
Collateral Bonds. The retirement of bonds of prior series is the basis for the
issuance of the balance of the Collateral Bonds which the Company presently
anticipates issuing.

RELEASE PROVISIONS: Property sold may be released from the lien of the
Mortgage Indenture upon deposit of its fair value with the Mortgage Trustee.
Purchase money obligations so deposited may not exceed 60% of fair value of the
released property. Release funds may be withdrawn on the basis of the lesser of
cost or fair value of net permanent additions applied for the purpose, or the
principal amount of bonds surrendered by the Company, or may be applied to bond
retirement. Bonds may be redeemed from release funds only when they are subject
to redemption and upon payment of the applicable regular redemption premium.
Property certified as no longer necessary in the Company's business and of less
than $500,000 value (but not to exceed in the aggregate per year an amount equal
to 1% of the outstanding bonds) may be released upon the Company's covenant to
deposit the proceeds of sale, if any, and such proceeds may be withdrawn upon
the Company's covenant to expend the same for permanent additions.

MODIFICATION OF INDENTURE: With the consent of the Company and the holders
of 70% in principal amount of bonds then outstanding, the Mortgage Indenture and
the bonds (including the Collateral Bonds) may be modified except as to (a) the
due dates, amounts and other terms (other than sinking fund provisions) of
payment of principal or interest, or (b) the creation of any lien ranking prior
to or on a parity with the lien of the Mortgage Indenture, or (c) deprivation of
any nonassenting bondholder of a lien on the mortgaged property for the security
of such bondholder's bonds, or (d) reduction of the percentage in the amount of
bonds required to consent to a modification of the Mortgage Indenture. The
Company and the Mortgage Trustee may also modify the Mortgage Indenture, without
any action on the part of the bondholders, provided that any modification that
would adversely affect the rights of the holders of any bonds then outstanding
may not become effective until all bonds outstanding at the time of the adoption
of the modification have been redeemed or retired.

CONCERNING THE TRUSTEE: The Mortgage Trustee under the Mortgage Indenture
is Firstar Bank Milwaukee, N.A., National Association. Firstar is also the
Senior Trustee under the Senior Indenture, a depositary of funds of the Company
and the transfer agent for the preferred stock of the Company and of the common
stock of WPSR.

DEFAULTS AND NOTICE THEREOF: The following events are defined as "completed
defaults" under the Mortgage Indenture: (a) default in the payment of the
principal of any bond; (b) default continued for 90 days in the payment of any
interest upon any bond; (c) default in certain covenants of the Company with
respect to bankruptcy, insolvency, assignment or receivership; or (d) default
continued for 90 days after notice to the Company from the Mortgage Trustee in
the performance of any other covenant, agreement or condition contained in the
Mortgage Indenture. The Mortgage Trustee may withhold notice to

16
<PAGE>
bondholders of defaults (other than in payment of principal, interest or a
sinking fund installment) if its responsible officers believe that the
withholding of such notice is in the interest of the bondholders.

The holders of a majority in principal amount of the bonds outstanding may
direct the Mortgage Trustee in the exercise of its powers, and in case of
completed default may require the Mortgage Trustee to declare the maturity of
the bonds accelerated, and upon certain conditions may rescind and annul such
declaration. The Mortgage Trustee may decline to follow any direction as to the
exercise of its powers if the Mortgage Trustee (i) is advised by counsel that
the directed action may not lawfully be taken or (ii) determines in good faith
that compliance with such directions would involve the Mortgage Trustee in
personal liability or that it will not be sufficiently indemnified for any
expenditures arising from compliance with such directions.

EVIDENCE OF COMPLIANCE WITH INDENTURE PROVISIONS: There is no general
requirement for periodic evidence to be furnished to the Mortgage Trustee as to
absence of defaults or as to general compliance with the terms of the Mortgage
Indenture; however, in all cases where action by the Mortgage Trustee is
requested by the Company, such as the issuance of additional bonds or the
release of cash or property under the Mortgage Indenture, the Company is
required to deliver to the Mortgage Trustee certain certificates signed and
verified by officers, engineers, accountants or other experts, who in certain
cases are required to be independent persons. Under pertinent circumstances
these certificates certify as to absence of default, the fair value of property
in respect of which the action is requested and the net earnings of the Company,
and in all cases certificates or opinions are required as to compliance by the
Company with conditions precedent to such action.

LEGAL OPINIONS AND EXPERTS

Opinions as to legality of the Senior Debt Securities will be rendered by
Foley & Lardner, 777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202, counsel
for the Company. Certain legal matters in connection with the offering or
offerings of the Senior Debt Securities will be passed upon for the Underwriters
or agents by their counsel. In giving their opinions such counsel may rely as to
all matters of Wisconsin law upon the opinion of Foley & Lardner. The
incorporation of the Company, the right of the Company to operate as a public
utility under the laws of Wisconsin, the titles to its properties, the
franchises and other operating rights of the Company, and the lien of the
Mortgage Indenture upon such property and franchises will be passed upon only by
Foley & Lardner. The statements as to matters of law and legal conclusions made
in this Prospectus under the captions "Description of Senior Debt Securities"
and "Description of First Mortgage Bonds" and in the documents incorporated by
reference in this Prospectus have been prepared under the supervision of, and
reviewed by, Foley & Lardner who are giving their opinion that such statements
are correct in all respects which Foley & Lardner deems material, and all such
statements are made on the basis of such opinion.

The financial statements and schedules which are incorporated by reference
into this Prospectus by reference to the Company's Annual Report on Form 10-K
for the year ended December 31, 1997, have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report with respect
thereto, and are included herein in reliance upon the authority of said firm as
experts in giving said report. Future financial statements and schedules of the
Company and the reports thereon of Arthur Andersen LLP also will be incorporated
by reference in this Prospectus in reliance upon the authority of said firm as
experts in giving those reports to the extent said firm has audited those
financial statements and schedules and consented to the use of their reports
thereon.

PLAN OF DISTRIBUTION

The Company may sell the Senior Debt Securities to or through underwriters,
and also may sell the Senior Debt Securities directly to other purchasers or
through agents.

17
<PAGE>
The distribution of the Senior Debt Securities may be effected from time to
time in one or more transactions at a fixed price or prices, which may be
changed, or at market prices prevailing at the time of sale, at prices related
to such prevailing market prices or at negotiated prices.

In connection with the sale of the Senior Debt Securities, underwriters may
receive compensation from the Company or from purchasers of the Senior Debt
Securities for whom they may act as agents in the form of discounts, concessions
or commissions. Underwriters may sell the Senior Debt Securities to or through
dealers, and such dealers may receive compensation in the form of discounts,
concessions or commissions from the underwriters and/or commissions from the
purchasers for whom they act as agents. Underwriters, dealers and agents that
participate in the distribution of the Senior Debt Securities may be deemed to
be underwriters, and any discounts or commissions received by them from the
Company and any profit on the resale of the Senior Debt Securities by them may
be deemed to be underwriting discounts and commissions, under the Act. The terms
of any particular offering, including the identity of any such underwriter or
agent and any such compensation received from the Company, will be described in
the Prospectus Supplement with respect to the Senior Debt Securities so offered.

Under agreements which may be entered into by the Company, underwriters and
agents who participate in the distribution of the Senior Debt Securities may be
entitled to indemnification by the Company against certain liabilities,
including liabilities under the Act.

The Senior Debt Securities are not proposed to be listed on a securities
exchange, and any underwriters will not be obligated to make a market in the
Senior Debt Securities. The Company cannot predict the activity or liquidity of
any trading in the Senior Debt Securities.

18
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS SUPPLEMENT AND
THE ACCOMPANYING PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR BY ANY OF THE UNDERWRITERS. THIS PROSPECTUS SUPPLEMENT AND ACCOMPANYING
PROSPECTUS DO NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN
WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING
SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS
PROSPECTUS SUPPLEMENT OR ACCOMPANYING PROSPECTUS NOR ANY SALE MADE HEREUNDER OR
THEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.

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

TABLE OF CONTENTS

PROSPECTUS SUPPLEMENT

<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
Certain Terms of Senior Secured Notes, %
Series Due ,..................... S-2
Summary Financial Information.................. S-3
Book-Entry Issuance--The Depository Trust
Company...................................... S-3
Underwriting................................... S-4

PROSPECTUS
Available Information.......................... 2
Incorporation of Certain Documents by
Reference.................................... 2
Summary Information............................ 3
The Company.................................... 4
Use of Proceeds................................ 4
Description of the Senior Debt Securities...... 4
Description of First Mortgage Bonds............ 14
Legal Opinions and Experts..................... 17
Plan of Distribution........................... 17
</TABLE>

$[50],000,000

WISCONSIN PUBLIC SERVICE CORPORATION

SENIOR SECURED NOTES, % SERIES DUE

------

P R O S P E C T U S S U P P L E M E N T

---------

SALOMON SMITH BARNEY

A.G. EDWARDS & SONS, INC.

LEGG MASON WOOD WALKER INCORPORATED

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

Estimated expenses, other than underwriting discounts and commissions,
payable by the Company are as follows:

<TABLE>
<S> <C>
Fees to regulatory commissions.................................... $ 1,000
Registration fee under the Securities Act of 1933................. 28,924
Fees and expenses incident to Blue Sky and Legal Investment
Laws............................................................ 15,000
Trustee fee....................................................... 25,000
Accounting services and expenses.................................. 25,000
Rating agency fees................................................ 15,000
Legal services and expenses....................................... 120,000
Financial printing................................................ 50,000
Miscellaneous..................................................... 2,076
---------
Total............................................................. $ 282,000
</TABLE>

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Pursuant to the Wisconsin Business Corporation Law and Article VI of the
By-laws of the Company directors and officers of the Company are entitled to
mandatory indemnification from the Company against certain liabilities and
expenses to the extent such officers or directors are successful on the merits
or otherwise in connection with a proceeding, unless it is determined that the
director or officer breached or failed to perform his or her duties to the
Company and such breach or failure constituted: (a) a willful failure to deal
fairly with the Company or its shareholders in connection with a matter in which
the director or officer had a material conflict of interest; (b) a violation of
the criminal law unless the director or officer had reasonable cause to believe
his or her conduct was lawful or had no reasonable cause to believe his or her
conduct was unlawful; (c) a transaction from which the director or officer
derived an improper personal profit (unless such profit is immaterial under the
circumstances); or (d) willful misconduct. It should also be noted that the
Wisconsin Business Corporation Law specifically states that it is the policy of
Wisconsin to require or permit indemnification in connection with a proceeding
involving securities regulation, as described therein, to the extent required or
permitted as described above. Additionally, under the Wisconsin Business
Corporation Law, directors of the Company are not subject to personal liability
to the Company, its shareholders or any person asserting rights on behalf
thereof for certain breaches or failures to perform any duty resulting solely
from their status except in circumstances paralleling those in subparagraphs (a)
through (d) outlined above.

The indemnification described above may be broad enough to cover liabilities
under the Securities Act of 1933. Officers and Directors of the Company would
also be indemnified by the Underwriters for certain claims under the Securities
Act of 1933 pursuant to the terms of the proposed form of underwriting agreement
filed herewith. The Company has purchased insurance permitted by the Wisconsin
Business Corporation Law on behalf of its officers and directors which may cover
liabilities under the Securities Act of 1933.

ITEM 16. EXHIBITS.

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- ------ --------------------------------------------------------------------------
<C> <S>
1 Form of Underwriting Agreement.

2 None.

4A Form of Indenture relating to Senior Debt Securities.
</TABLE>

II-1
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- ------ --------------------------------------------------------------------------
<C> <S>
4B Copy of First Mortgage and Deed of Trust, dated as of January 1, 1941 to
First Wisconsin Trust Company, Trustee (Incorporated by reference to
Exhibit 7.01--File No. 2-7229); Supplemental Indenture, dated as of
November 1, 1947 (Incorporated by reference to Exhibit 7.02--File No.
2-7602); Supplemental Indenture, dated as of November 1, 1950
(Incorporated by reference to Exhibit 4.04--File No. 2-10174);
Supplemental Indenture, dated as of May 1, 1953 (Incorporated by
reference to Exhibit 4.03--File No. 2-10716); Supplemental Indenture,
dated as of October 1, 1954 (Incorporated by reference to Exhibit
4.03--File No. 2-13572); Supplemental Indenture, dated as of December 1,
1957 (Incorporated by reference to Exhibit 4.03--File No. 2-14527);
Supplemental Indenture, dated as of October 1, 1963 (Incorporated by
reference to Exhibit 2.02B--File No. 2-65710); Supplemental Indenture,
dated as of June 1, 1964 (Incorporated by reference to Exhibit
2.02B--File No. 2-65710); Supplemental Indenture, dated as of November
1, 1967 (Incorporated by reference to Exhibit 2.02B--File No. 2-65710);
Supplemental Indenture, dated as of April 1, 1969 (Incorporated by
reference to Exhibit 2.02B--File No. 2-65710); Fifteenth Supplemental
Indenture, dated as of May 1, 1971 (Incorporated by reference to Exhibit
2.02B--File No. 2-65710); Sixteenth Supplemental Indenture, dated as of
August 1, 1973 (Incorporated by reference to Exhibit 2.02B--File No.
2-65710); Seventeenth Supplemental Indenture, dated as of September 1,
1973 (Incorporated by reference to Exhibit 2.02B--File No. 2-65710);
Eighteenth Supplemental Indenture, dated as of October 1, 1975
(Incorporated by reference to Exhibit 2.02B--File No. 2-65710);
Nineteenth Supplemental Indenture, dated as of February 1, 1977
(Incorporated by reference to Exhibit 2.02B--File No. 2-65710);
Twentieth Supplemental Indenture, dated as of July 15, 1980
(Incorporated by reference to Exhibit 4B to Form 10-K for the year ended
December 31, 1980); Twenty-First Supplemental Indenture, dated as of
December 1, 1980 (Incorporated by reference to Exhibit 4B to Form 10-K
for the year ended December 31, 1980); Twenty-Second Supplemental
Indenture, dated as of April 1, 1981 (Incorporated by reference to
Exhibit 4B to Form 10-K for the year ended December 31, 1981);
Twenty-Third Supplemental Indenture, dated as of February 1, 1984
(Incorporated by reference to Exhibit 4B to Form 10-K for the year ended
December 31, 1983); Twenty-Fourth Supplemental Indenture, dated as of
March 15, 1984 (Incorporated by reference to Exhibit 1 to Form 10-Q for
the quarter ended June 30, 1984); Twenty-Fifth Supplemental Indenture,
dated as of October 1, 1985 (Incorporated by reference to Exhibit 1 to
Form 10-Q for the quarter ended September 30, 1985); Twenty-Sixth
Supplemental Indenture, dated as of December 1, 1987 (Incorporated by
reference to Exhibit 4A-1 to Form 10-K for the year ended December 31,
1987; Twenty-Seventh Supplemental Indenture, dated as of September 1,
1991 (Incorporated by reference to Exhibit 4 to Form 8-K filed September
18, 1991); Twenty-Eighth Supplemental Indenture, dated as of July 1,
1992 (Incorporated by reference to Exhibit 4B--File No. 33-51428);
Twenty-Ninth Supplemental Indenture, dated as of October 1, 1992
(Incorporated by reference to Exhibit 4 to Form 8-K filed October 22,
1992); Thirtieth Supplemental Indenture, dated as of February 1, 1993
(Incorporated by reference to Exhibit 4 to Form 8-K filed January 27,
1993); Thirty-First Supplemental Indenture, dated as of July 1, 1993
(Incorporated by reference to Exhibit 4 to Form 8-K filed July 7, 1993);
Thirty-Second Supplemental Indenture, dated as of November 1, 1993
(Incorporated by reference to Exhibit 4 to Form 10-Q for the quarter
ended September 30, 1993).
</TABLE>

II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- ------ --------------------------------------------------------------------------
<C> <S>
The Company's file number for reports filed pursuant to the Securities
Exchange Act of 1934 is 1-3016.

4C Form of Supplemental Indenture relating to Senior Debt Securities.

4D Form of Supplemental Indenture relating to Collateral Bonds.

5 Opinion of counsel as to legality of the Senior Debt Securities.

8 None.

12 Computation of Ratio of Earnings to Fixed Charges.

15 None.

23.1 Consents of Arthur Andersen LLP.

23.2 Consent of Foley & Lardner (included in Exhibit 5)

24 Powers of Attorney (contained on signature pages hereto).

25 Statement of Eligibility of Trustee.

26 None.

27 None
</TABLE>

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes:

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

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

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

(iii) to include any material information with respect to the Plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the registrant 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 the time shall be deemed to
be the initial bona fide offering thereof.

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

(4) that, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to
Section 13(a) or 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.

(5) that, for purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as
part of this registration statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1)
or (4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

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

II-4
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
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 such Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Green Bay, State of Wisconsin, on this 25th day of
November, 1998.

WISCONSIN PUBLIC SERVICE CORPORATION
(the "Company" or the "Registrant")

By: /s/ PATRICK D. SCHRICKEL

-----------------------------------
Patrick D. Schrickel
PRESIDENT

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below on November 25, 1998, by the
following persons in the capacities indicated. Each person whose signature
appears below hereby appoints Ralph G. Baeten and Francis J. Kicsar, and each of
them, his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him and his name, place and stead, in any
and all capacities, to sign any and all amendments to this Registration
Statement and to file the same, with all exhibits thereto, and other documents
in connection herewith, with the Securities and Exchange Commission, granting
unto each said attorney-in-fact and agent, full power and authority to do and
perform each and every act and thing requisite and necessary to be done, as
fully as he might or could do in person, hereby ratifying and confirming all
that said attorney-in-fact and agent may lawfully do or cause to be done by
virtue hereof.

<TABLE>
<CAPTION>
NAME CAPACITY
- ------------------------------ ------------------------------------------

<C> <S>
/s/ LARRY L. WEYERS
- ------------------------------ Chairman, Principal Executive Officer and
Larry L. Weyers Director

/s/ DANIEL P. BITTNER
- ------------------------------ Principal Financial Officer
Daniel P. Bittner

/s/ DIANE L. FORD
- ------------------------------ Principal Accounting Officer
Diane L. Ford

/s/ A. DEAN ARGANBRIGHT
- ------------------------------ Director
A. Dean Arganbright

/s/ MICHAEL S. ARIENS
- ------------------------------ Director
Michael S. Ariens
</TABLE>

S-1
<PAGE>
<TABLE>
<CAPTION>
NAME CAPACITY
- ------------------------------ ------------------------------------------
/s/ RICHARD A. BEMIS
- ------------------------------ Director
Richard A. Bemis
<C> <S>

/s/ DANIEL A. BOLLOM
- ------------------------------ Director
Daniel A. Bollom

/s/ M. LOIS BUSH
- ------------------------------ Director
M. Lois Bush

/s/ CLARENCE R. FISHER
- ------------------------------ Director
Clarence R. Fisher

/s/ ROBERT C. GALLAGHER
- ------------------------------ Director
Robert C. Gallagher

/s/ KATHRYN
HASSELBLAD-PASCALE
- ------------------------------ Director
Kathryn Hasselblad-Pascale

/s/ JAMES L. KEMERLING
- ------------------------------ Director
James L. Kemerling
</TABLE>

S-2

<PAGE>
Exhibit 1

Wisconsin Public Service Corporation

____% Senior Notes Due _______

Form of Underwriting Agreement

New York, New York
___________ , 19__

To the Representatives
named in Schedule I
hereto of the Under-
writers named in
Schedule II hereto

Ladies and Gentlemen:

Wisconsin Public Service Corporation, a corporation
organized under the laws of Wisconsin (the "Company"), proposes to sell to
the several underwriters named in Schedule II hereto (the "Underwriters"),
for whom you (the "Representatives") are acting as representatives, the
principal amount of its senior debt securities identified in Schedule I
hereto (the "Senior Notes"), to be issued under an Indenture dated as of
December 1, 1998, between the Company and Firstar Bank Milwaukee, N.A., as
trustee (the "Senior Trustee"), as supplemented by the _______ Supplemental
Indenture dated __________, 19__, creating the series in which the Senior
Notes are to be issued, a form of which is included as an exhibit to the
Registration Statement (the "Supplemental Indenture to the Senior
Indenture"). The term "Senior Indenture," as used herein, means such
Indenture dated as of December 1, 1998 , as supplemented by the
Supplemental Indenture to the Senior Indenture. To the extent there are no
additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as
the context requires.

Until the Release Date (as defined in the Senior
Indenture), the Senior Notes will be secured as to payment of principal and
interest by the Company's First Mortgage Bonds, Collateral Series ___ (the
"Collateral Bonds"), issued under and ratably secured by the First Mortgage
and Deed of Trust dated January 1, 1941 between the Company and Firstar Bank
Milwaukee, N.A. (the successor to First Wisconsin Trust Company), as Trustee
(the "Mortgage Trustee"), as amended and supplemented to the Execution Time
(as so amended and supplemented, the "Original Mortgage Indenture") and to be
further supplemented by the ___________ Supplemental Indenture thereto, a
form of which is included in the Registration Statement, creating the
Collateral Bonds (the "Supplemental Indenture to the Mortgage Indenture").
The term "Mortgage Indenture," as used herein, means the Original Mortgage
Indenture, as supplemented by the Supplemental Indenture to

<PAGE>

the Mortgage Indenture. The Collateral Bonds will be issued, pledged and
delivered to the Senior Trustee by the Company concurrently with the issue
and delivery of the Senior Notes.

Any reference herein to the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall be
deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 which were filed under the Exchange
Act on or before the Effective Date of the Registration Statement or the
issue date of the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus, as the case may be; and any reference herein to the terms
"amend", "amendment" or "supplement" with respect to the Registration
Statement, the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus shall be deemed to refer to and include the filing of any
document under the Exchange Act after the Effective Date of the Registration
Statement or the issue date of the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus, as the case may be, deemed to be
incorporated therein by reference. Certain terms used herein are defined in
Section 17 hereof. Capitalized terms used herein and not otherwise defined
have the meaning given such terms in the Senior Indenture.

1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to, and agrees with, each Underwriter as set forth below in this
Section 1.

(a) The Company meets the requirements for use of Form S-3 under the
Act and has prepared and filed with the Commission a registration statement
(the file number of which is set forth in Schedule I hereto) on Form S-3,
including a related basic prospectus, for registration under the Act of the
offering and sale of the Senior Notes. The Company may have filed one or
more amendments thereto, including a Preliminary Final Prospectus, each of
which has previously been furnished to you. The Company will next file
with the Commission one of the following: (1) after the Effective Date of
such registration statement, a final prospectus supplement relating to the
Senior Notes in accordance with Rules 430A and 424(b), (2) prior to the
Effective Date of such registration statement, an amendment to such
registration statement (including the form of final prospectus supplement),
or (3) a final prospectus in accordance with Rules 415 and 424(b). In the
case of clause (1), the Company has included in such registration
statement, as amended at the Effective Date, all information (other than
Rule 430A Information) required by the Act and the rules thereunder to be
included in such registration statement and the Final Prospectus. As
filed, such final prospectus supplement or such amendment and form of final
prospectus supplement shall contain all Rule 430A Information, together
with all other such required information, and, except to the extent the
Representatives shall agree in writing to a modification, shall be in all
substantive respects in the form furnished to you prior to the Execution
Time or, to the extent not completed at the Execution Time, shall contain
only such specific additional information and other changes (beyond that
contained in the Basic Prospectus and any Preliminary Final Prospectus) as
the Company has advised you, prior to the Execution Time, will be included
or made therein. The Registration Statement, at the Execution Time, meets
the requirements set forth in Rule 415(a)(1)(x).

<PAGE>

(b) On the Effective Date, the Registration Statement did or will,
and when the Final Prospectus is first filed (if required) in accordance
with Rule 424(b) and on the Closing Date (as defined herein), the Final
Prospectus (and any supplement thereto) will, comply in all material
respects with the applicable requirements of the Act, the Exchange Act and
the Trust Indenture Act and the respective rules thereunder; on the
Effective Date and at the Execution Time, the Registration Statement did
not or will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order
to make the statements therein not misleading; on the Effective Date and on
the Closing Date the Indenture did or will comply in all material respects
with the applicable requirements of the Trust Indenture Act and the rules
thereunder; and, on the Effective Date, the Final Prospectus, if not filed
pursuant to Rule 424(b), will not, and on the date of any filing pursuant
to Rule 424(b) and on the Closing Date, the Final Prospectus (together with
any supplement thereto) will not, include any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading; PROVIDED, HOWEVER, that the Company makes no
representations or warranties as to (i) that part of the Registration
Statement which shall constitute the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of the Trustee or
(ii) the information contained in or omitted from the Registration
Statement or the Final Prospectus (or any supplement thereto) in reliance
upon and in conformity with information furnished in writing to the Company
by or on behalf of any Underwriter through the Representatives specifically
for inclusion in the Registration Statement or the Final Prospectus (or any
supplement thereto).

(c) The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Wisconsin with
power and authority (corporate and other) to own or lease, as the case may
be, and to operate its properties and conduct its business as described in
the Final Prospectus; the Company has not filed Articles of Dissolution
with the Secretary of State of Wisconsin, and no grounds exist for the
Secretary of State of Wisconsin to dissolve such corporation
administratively pursuant to the provisions of the Wisconsin Business
Corporation Law; the Company is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each jurisdiction
which requires such qualification; the Company is a "public utility
company" as such term is defined in the Public Utility Holding Company Act
of 1935, as amended (the "Public Utility Holding Company Act").

(d) The Company has no subsidiaries which, either individually or
considered in the aggregate as a single subsidiary, constitute a
"significant subsidiary" as defined in Rule 1-02 of Regulation S-X.

(e) All of the Company's issued and outstanding shares of common
stock are owned, beneficially and of record, by WPS Resources Corporation,
a Wisconsin corporation ("WPSR"); the Company's authorized preferred stock
is as set forth in the Final Prospectus; except as set forth in the Final
Prospectus, no options, warrants or other rights to purchase, agreements or
other obligations to issue, or rights to convert any obligations into or
exchange

<PAGE>

any securities for, shares of capital stock or ownership interests of the
Company are outstanding.

(f) There is no franchise, contract or other document of a character
required to be described in the Registration Statement or Final Prospectus,
or to be filed as an exhibit thereto, which is not described or filed as
required.

(g) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding obligation of
the Company enforceable in accordance with its terms.

(h) The Senior Indenture has been duly authorized by the Company; on
the Closing Date, the Senior Indenture will have been duly executed by the
Company and, assuming due authorization, execution and delivery by the
Senior Trustee, will be a valid and binding instrument enforceable against
the Company in accordance with its terms, subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency, moratorium,
or other laws affecting creditors' rights generally from time to time in
effect and to general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing,
regardless of whether considered in a proceeding in equity or at law (the
"Bankruptcy Exceptions"); the Senior Indenture has been duly qualified
under the Trust Indenture Act; the Senior Indenture conforms in all
material respects to the description thereof contained in the Final
Prospectus.

(i) The Senior Notes have been duly authorized by the Company; on the
Closing Date, the Senior Notes will have been duly executed by the Company,
and when authenticated in accordance with the provisions of the Senior
Indenture and delivered and paid for by the Underwriters pursuant to this
Agreement, will constitute valid and legally binding obligations of the
Company entitled to the benefits and security provided by the Senior
Indenture and enforceable against the Company in accordance with their
terms, subject, as to enforcement of remedies, to the Bankruptcy
Exceptions; the Senior Notes conform in all material respects to the
description thereof contained in the Final Prospectus.

(j) The Original Mortgage Indenture has been duly authorized,
executed and delivered by the Company; the Supplemental Indenture to the
Mortgage Indenture has been duly authorized by the Company and, on the
Closing Date, will have been duly executed and delivered by the Company
and, assuming due execution and delivery of the Supplemental Indenture to
the Mortgage Indenture by the Mortgage Trustee, the Mortgage Indenture will
constitute a valid and binding instrument, enforceable against the Company
in accordance with its terms, except as the same may be limited by the laws
of the States of Wisconsin and Michigan affecting the remedies for the
enforcement of the security provided for therein (which laws do not make
such remedies inadequate for the realization of the benefits of such
security) and by the Bankruptcy Exceptions; the Mortgage Indenture conforms
in all material respects to the description thereof contained in the Final
Prospectus.

<PAGE>

(k) The Collateral Bonds have been duly authorized by the Company
and, when duly executed and authenticated in accordance with the provisions
of the Mortgage Indenture and delivered to the Senior Trustee in the manner
provided therein, will have been duly authorized, executed, authenticated
and issued and will constitute valid and legally binding obligations of the
Company, secured by the lien of, and entitled to the benefits provided by,
the Mortgage Indenture, equally and ratably with all other bonds of the
Company duly issued and outstanding under the Mortgage Indenture, and will
be enforceable against the Company in accordance with their terms, except
as the same may be limited by the laws of the States of Wisconsin and
Michigan affecting the remedies for the enforcement of the security
provided for therein (which laws do not make such remedies inadequate for
the realization of the benefits of such security) and by the Bankruptcy
Exceptions; the Collateral Bonds conform in all material respects to the
description thereof contained in the Final Prospectus.

(l) Each of the Company and its subsidiaries owns or leases all such
properties as are necessary to the conduct of its operations as presently
conducted. The properties of the Company described under Item 2 of the
Company's most recent Annual Report on Form 10-K are owned in fee simple
either individually or jointly, as indicated in such annual report, or are
held under valid leases, in each case subject only to the lien of the
Mortgage Indenture and minor imperfections of titles and encumbrances, if
any, which are not substantial in amount, do not materially detract from
the value or marketability of the properties subject thereto, and do not
materially impair the Company's operations.

(m) The Company is not and, after giving effect to the offering and
sale of the Senior Notes and the application of the proceeds thereof as
described in the Final Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940, as amended.

(n) Except for WPSR, no person or corporation which is a "holding
company" or a "subsidiary of a holding company" within the meaning of such
terms as defined in the Public Holding Company Act, directly or indirectly
owns, controls or holds with power to vote 10% or more of the outstanding
voting securities of the Company; WPSR and the Company are presently exempt
from the provisions of the Public Utility Holding Company Act which would
require them to register thereunder.

(o) The Public Service Commission of Wisconsin has duly
authorized the issuance and sale by the Company of the Senior Notes and the
issuance and pledge of the Collateral Bonds on the terms set forth in the
Final Prospectus and this Agreement, and such authorization is in force
and effect and sufficient for the issuance and sale of the Senior Notes to
the Underwriters and the issuance and pledge of the Collateral Bonds to the
Senior Trustee. No other consent, approval, authorization, filing with or
order of any court or other governmental agency or body is required in
connection with the transactions contemplated herein, except such as have
been obtained under the Act and the Trust Indenture Act and such as may be
required under the blue sky laws of any jurisdiction in connection with the
purchase and distribution of the Senior Notes by the Underwriters in the
manner contemplated herein and in the Final Prospectus.

<PAGE>

(p) The execution and delivery of the Senior Indenture or the
Supplemental Indenture to the Mortgage Indenture, the issue and sale of the
Senior Notes, the issue and pledge of the Collateral Bonds, the
consummation of any other of the transactions herein contemplated or the
fulfillment of the terms hereof will not conflict with, result in a breach
or violation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its subsidiaries pursuant to,
(i) the charter or by-laws of the Company or any of its subsidiaries,
(ii) the terms of any indenture, contract, lease, mortgage, deed of trust,
note agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company or any of its subsidiaries is a
party or bound or to which its or their property is subject (other than the
lien of the Mortgage Indenture), or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the Company or any of
its subsidiaries of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction over
the Company or any of its subsidiaries or any of its or their properties.

(q) No holders of securities of the Company have rights to the
registration of such securities under the Registration Statement.

(r) The consolidated historical financial statements and schedules of
the Company and its consolidated subsidiary included in the Final
Prospectus and the Registration Statement present fairly in all material
respects the financial condition, results of operations and cash flows of
the Company and its subsidiary as of the dates and for the periods
indicated, comply as to form with the applicable accounting requirements of
the Act and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved (except as otherwise noted therein). The selected financial data
set forth under the caption "Summary Financial Information" in the Final
Prospectus and Registration Statement fairly present, on the basis stated
in the Final Prospectus and the Registration Statement, the information
included therein.

(s) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property is pending or,
to the best knowledge of the Company, threatened that (i) could reasonably
be expected to have a material adverse effect on the performance of this
Agreement or the consummation of any of the transactions contemplated
hereby or (ii) could reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Final Prospectus
(exclusive of any supplement thereto).

(t) Neither the Company nor any of its subsidiaries is in violation
or default of (i) any provision of its charter or bylaws, (ii) the terms of
any indenture, contract, lease, mortgage, deed of trust, note agreement,
loan agreement or other agreement, obligation, condition, covenant or
instrument to which it is a party or bound or to which its property is
subject, except for such violations or defaults which would not,
individually or in the

<PAGE>

aggregate, have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company
and its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, or (iii) any statute,
law, rule, regulation, judgment, order or decree of any court, regulatory
body, administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or such subsidiary or any
of its properties, as applicable.

(u) Arthur Andersen LLP, who have certified certain financial
statements of the Company and its consolidated subsidiary and delivered
their report with respect to the audited consolidated financial statements
and schedules included in the Prospectus, are independent public
accountants with respect to the Company within the meaning of the Act and
the applicable published rules and regulations thereunder.

(v) The Company has filed all foreign, federal, state and local tax
returns that are required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in
the Final Prospectus (exclusive of any supplement thereto) and has paid all
taxes required to be paid by it and any other assessment, fine or penalty
levied against it, to the extent that any of the foregoing is due and
payable, except for any such assessment, fine or penalty that is currently
being contested in good faith or as would not have a material adverse
effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Final Prospectus
(exclusive of any supplement thereto).

(w) No labor problem or dispute with the employees of the Company
exists or is threatened or imminent, and the Company is not aware of any
existing or imminent labor disturbance by the employees of any of its
principal suppliers, contractors or customers, that could have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the Final Prospectus
(exclusive of any supplement thereto).

(x) The Company and each of its subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which they
are engaged; all policies of insurance and fidelity or surety bonds
insuring the Company or any of its subsidiaries or their respective
businesses, assets, employees, officers and directors are in full force and
effect; the Company and its subsidiaries are in compliance with the terms
of such policies and instruments in all material respects; and there are no
claims by the Company or any of its subsidiaries under any such policy or
instrument as to which any insurance company is denying liability or
defending under a reservation of rights clause, except for such claims
which, if successfully denied, would not have a material adverse effect on
the condition

<PAGE>

(financial or otherwise), prospects, earnings, business or properties of
the Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business; neither the
Company nor any such subsidiary has been refused any insurance coverage
sought or applied for; and neither the Company nor any subsidiary has any
reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Final Prospectus (exclusive
of any supplement thereto).

(y) The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct their
respective businesses, and neither the Company nor any subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the Company
and its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Final Prospectus (exclusive of any supplement thereto).

(z) The Company and each of its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.

(aa) The Company has not taken, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Senior Notes.

(bb) The Company and its subsidiaries are (i) in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received and are in compliance with all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses, and (iii) have
not received notice of any actual or potential liability for the
investigation or remediation of any disposal

<PAGE>

or release of hazardous or toxic substances or wastes, pollutants or
contaminants, except where such non-compliance with Environmental Laws,
failure to receive required permits, licenses or other approvals, or
liability would not, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in
the Final Prospectus (exclusive of any supplement thereto). Except as
set forth in the Final Prospectus, the Company has not been named as a
"potentially responsible party" under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended.

(cc) In the ordinary course of its business, the Company periodically
reviews the effect of Environmental Laws on the business, operations and
properties of the Company and its subsidiaries, in the course of which it
identifies and evaluates associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with Environmental Laws, or
any permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties). On the basis
of such review, the Company has reasonably concluded that such associated
costs and liabilities would not, singly or in the aggregate, have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in
the Final Prospectus (exclusive of any supplement thereto).

(dd) Each of the Company and its subsidiaries has fulfilled its
obligations, if any, under the minimum funding standards of Section 302 of
the United States Employee Retirement Income Security Act of 1974 ("ERISA")
and the regulations and published interpretations thereunder with respect
to each "plan" (as defined in Section 3(3) of ERISA and such regulations
and published interpretations) in which employees of the Company and its
subsidiaries are eligible to participate, and each such plan is in
compliance in all material respects with the presently applicable
provisions of ERISA and such regulations and published interpretations.
The Company and its subsidiaries have not incurred any unpaid liability to
the Pension Benefit Guaranty Corporation (other than for the payment of
premiums in the ordinary course) or to any such plan under Title IV of
ERISA.

(ee) The Company and its subsidiaries have implemented a
comprehensive, detailed program to analyze and address the risk that the
computer hardware and software used by it may be unable to recognize and
properly execute date-sensitive functions involving certain dates prior to
and any dates after December 31, 1999 (the "Year 2000 Problem"), and
reasonably believes that such risk will be remedied on a timely basis
without material expense, except as set forth or contemplated in the Final
Prospectus, and will not have a material adverse effect upon the financial
condition and results of operations of the Company and its subsidiaries,
taken as a whole.

<PAGE>

Any certificate signed by any officer of the Company and delivered to the
Representatives or counsel for the Underwriters in connection with the offering
of the Senior Notes shall be deemed a representation and warranty by the
Company, as to matters covered thereby, to each Underwriter.

2. PURCHASE AND SALE. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company, at the purchase price set forth in
Schedule I hereto the principal amount of the Senior Notes set forth opposite
such Underwriter's name in Schedule II hereto.

3. DELIVERY AND PAYMENT. Delivery of and payment for the Senior
Notes shall be made on the date and at the time specified in Schedule I hereto
or at such time on such later date not more than three Business Days after the
foregoing date as the Representatives shall designate, which date and time may
be postponed by agreement between the Representatives and the Company or as
provided in Section 9 hereof (such date and time of delivery and payment for the
Senior Notes being herein called the "Closing Date"). Delivery of the Senior
Notes shall be made to the Representatives for the respective accounts of the
several Underwriters against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to an account specified by
the Company. Delivery of the Senior Notes shall be made through the facilities
of The Depository Trust Company.

4. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to offer the Senior Notes for sale to the public as set
forth in the Final Prospectus.

5. AGREEMENTS. The Company agrees with the several Underwriters
that:

(a) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment
thereof, to become effective. Prior to the termination of the offering of
the Senior Notes, the Company will not file any amendment of the
Registration Statement or supplement (including the Final Prospectus or any
Preliminary Final Prospectus) to the Basic Prospectus or any Rule 462(b)
Registration Statement unless the Company has furnished you a copy for your
review prior to filing and will not file any such proposed amendment or
supplement to which you reasonably object. Subject to the foregoing
sentence, if the Registration Statement has become or becomes effective
pursuant to Rule 430A, or filing of the Final Prospectus is otherwise
required under Rule 424(b), the Company will cause the Final Prospectus,
properly completed, and any supplement thereto to be filed with the
Commission pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed and will provide evidence satisfactory to the
Representatives of such timely filing. The Company will promptly advise
the Representatives (1) when the Registration Statement, if not effective
at the Execution Time, shall have become effective, (2) when the Final
Prospectus, and any supplement thereto, shall have been filed (if required)
with the Commission pursuant to Rule 424(b) or when any Rule 462(b)
Registration Statement shall have been filed with the Commission, (3) when,
prior to termination of the offering of the Senior Notes, any amendment to
the Registration Statement shall have been filed or become effective,
(4) of any request by the Commission

<PAGE>

or its staff for any amendment of the Registration Statement, or any Rule
462(b) Registration Statement, or for any supplement to the Final
Prospectus or for any additional information, (5) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any
proceeding for that purpose and (6) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Senior Notes for sale in any jurisdiction or the institution or
threatening of any proceeding for such purpose. The Company will use its
best efforts to prevent the issuance of any such stop order or the
suspension of any such qualification and, if issued, to obtain as soon as
possible the withdrawal thereof.

(b) If, at any time when a prospectus relating to the Senior Notes is
required to be delivered under the Act, any event occurs as a result of
which the Final Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under
which they were made not misleading, or if it shall be necessary to amend
the Registration Statement or supplement the Final Prospectus to comply
with the Act or the Exchange Act or the respective rules thereunder, the
Company promptly will (1) notify the Representatives of such event, (2)
prepare and file with the Commission, subject to the second sentence of
paragraph (a) of this Section 5, an amendment or supplement which will
correct such statement or omission or effect such compliance, and
(3) supply any supplemented Final Prospectus to you in such quantities as
you may reasonably request.

(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an earnings
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the Act and Rule 158 under the
Act.

(d) The Company will furnish to the Representatives and counsel for
the Underwriters, without charge, copies of the Registration Statement
(including exhibits thereto) and to each other Underwriter a copy of the
Registration Statement (without exhibits thereto) and, so long as delivery
of a prospectus by an Underwriter or dealer may be required by the Act, as
many copies of each Preliminary Final Prospectus and the Final Prospectus
and any supplement thereto as the Representatives may reasonably request.
The Company will pay the expenses of printing or other production of all
documents relating to the offering.

(e) The Company will arrange, if necessary, for the qualification of
the Senior Notes for sale under the laws of such jurisdictions as the
Representatives may designate and will maintain such qualifications in
effect so long as required for the distribution of the Senior Notes;
provided that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take
any action that would subject it to service of process in suits, other than
those arising out of the offering or sale of the Senior Notes, in any
jurisdiction where it is not now so subject.

<PAGE>
(f) Until the Business Day set forth on Schedule I hereto, the
Company will not, without the prior written consent of Salomon Smith
Barney, offer, sell or contract to sell, or otherwise dispose of (or enter
into any transaction which is designed to, or might reasonably be expected
to, result in the disposition (whether by actual disposition or effective
economic disposition due to cash settlement or otherwise) by the Company or
any affiliate of the Company or any person in privity with the Company or
any affiliate of the Company) directly or indirectly, or announce the
offering of, any debt securities issued or guaranteed by the Company (other
than the Senior Notes, commercial paper or other short-term debt).

(g) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Senior Notes.

(h) The Company will issue and deliver the Collateral Bonds to the
Senior Trustee as security for the Senior Notes in the manner described in
the Final Prospectus.

6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the Underwriters to purchase the Senior Notes shall be subject
to the accuracy of the representations and warranties on the part of the
Company contained herein as of the Execution Time and the Closing Date, to
the accuracy of the statements of the Company made in any certificates
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions:

(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Representatives agree in writing to a later
time, the Registration Statement will become effective not later than
(i) 6:00 PM New York City time, on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date, or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Final Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b), the Final Prospectus, and any such supplement,
will be filed in the manner and within the time period required by
Rule 424(b); and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.

(b) The Company shall have requested and caused Foley & Lardner,
counsel for the Company, to have furnished to the Representatives their
opinion, dated the Closing Date and addressed to the Representatives, to
the effect that:

(i) The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Wisconsin,
with full corporate power and authority to own or lease, as the case
may be, and to operate its properties and conduct its business as
described in the Final Prospectus, and is duly qualified to do
business as a foreign corporation and is in good standing under the
laws of Michigan;

<PAGE>

the Company is a "public utility company" as such term is defined
under the Public Utility Holding Company Act.

(ii) All of the Company's issued and outstanding shares of
common stock are owned of record by WPSR; the Company's authorized
preferred stock is as set forth in the Final Prospectus; except as set
forth in the Final Prospectus, no options, warrants or other rights to
purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for, shares of
capital stock of or ownership interests in the Company are
outstanding.

(iii) To the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property, of a
character required to be disclosed in the Registration Statement which
is not adequately disclosed in the Final Prospectus, and there is no
franchise, contract or other document of a character required to be
described in the Registration Statement or Final Prospectus, or to be
filed as an exhibit thereto, which is not described or filed as
required.

(iv) The Registration Statement has become effective under the
Act; any required filing of the Basic Prospectus, any Preliminary
Final Prospectus and the Final Prospectus, and any supplements
thereto, pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); to the knowledge of
such counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued, no proceedings for that
purpose have been instituted or threatened, and the Registration
Statement and the Final Prospectus (other than the financial
statements and other financial information contained therein, as to
which such counsel need express no opinion) comply as to form in all
material respects with the applicable requirements of the Act, the
Exchange Act and the Trust Indenture Act and the respective rules
thereunder; and such counsel has no reason to believe that on the
Effective Date or at the Execution Time the Registration Statement
contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading or that the Final Prospectus as
of its date and on the Closing Date included or includes any untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (in each
case, other than the financial statements and other financial
information contained therein, as to which such counsel need express
no opinion);

(v) This Agreement has been duly authorized, executed and
delivered by the Company.

(vi) The Senior Indenture has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding
instrument enforceable

<PAGE>

against the Company in accordance with its terms, subject, as to
enforcement of remedies, to the Bankruptcy Exceptions; the Senior
Indenture has been duly qualified under the Trust Indenture Act;
the Senior Indenture conforms in all material respects to the
description thereof contained in the Final Prospectus.

(vii) The Senior Notes have been duly authorized by the
Company, and when executed and authenticated in accordance with the
provisions of the Senior Indenture and delivered and paid for by the
Underwriters pursuant to this Agreement, will constitute valid and
legally binding obligations of the Company entitled to the benefits
and security provided by the Senior Indenture and enforceable against
the Company in accordance with their terms, subject, as to enforcement
of remedies, to the Bankruptcy Exceptions; the Senior Notes conform in
all material respects to the description thereof contained in the
Final Prospectus.

(viii) The Mortgage Indenture has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding
instrument, enforceable against the Company in accordance with its
terms, except as the same may be limited by the laws of the States of
Wisconsin and Michigan affecting the remedies for the enforcement of
the security provided for therein (which laws do not in such counsel's
opinion make such remedies inadequate for the realization of the
benefits of such security) and by the Bankruptcy Exceptions; the
Mortgage Indenture conforms in all material respects to the
description thereof contained in the Final Prospectus.

(ix) The Collateral Bonds have been duly authorized by the
Company and, when executed and authenticated in accordance with the
provisions of the Mortgage Indenture, and issued, pledged and
delivered to the Senior Trustee pursuant to the Senior Indenture as
security for the Senior Notes, will constitute valid and legally
binding obligations of the Company, secured by the lien of, and
entitled to the benefits provided by, the Mortgage Indenture, equally
and ratably with all other bonds of the Company duly issued and
outstanding under the Mortgage Indenture, and will be enforceable
against the Company in accordance with their terms, except as the same
may be limited by the laws of the States of Wisconsin and Michigan
affecting the remedies for the enforcement of the security provided
for therein (which laws do not in such counsel's opinion make such
remedies inadequate for the realization of the benefits of such
security) and by the Bankruptcy Exceptions; the Collateral Bonds
conform in all material respects to the description thereof contained
in the Final Prospectus.

(x) The Company has good and marketable title to the real and
fixed properties described in the Mortgage Indenture (other than
properties disposed of and released thereunder and lands described as
held only under flowage rights) free and clear of all liens, charges
and encumbrances against the same prior to or on a parity with the
lien of the Mortgage Indenture, except for and subject only to
permissible encumbrances as defined in the Mortgage Indenture and to
such exceptions, defects

<PAGE>

and qualifications as in such counsel's opinion do not materially
affect the security for the Collateral Bonds or the Company's title
to or its right to use such properties in the conduct of its
business; the Mortgage Indenture constitutes a valid and direct
first lien upon all real and fixed property and governmental
licenses and permits owned by the Company (including its interests
as tenant-in-common), except property specifically excepted from
the Mortgage Indenture by the terms thereof, subject to no liens or
encumbrances prior to or on a parity with the lien of the Mortgage
Indenture, except permissible encumbrances as defined in the
Mortgage Indenture; and the description in the Mortgage Indenture
of said property is adequate to constitute the Mortgage Indenture a
lien thereon. No examination of title covering rights-of-way for
transmission and distribution lines has been made inasmuch as the
Company has been advised that the expense incident to the obtaining
of abstracts or certificates of title and of examinations in
respect thereto would be in excess of the cost of reacquiring by
condemnation or purchase, possession and use of such parts of such
rights-of-way as might be held under defective titles, and
accordingly, such opinion does not cover such rights-of-way.
Such counsel has relied on certificates of officers of the Company
to the effect that certain parcels described in the Mortgage
Indenture are rights-of-way and that certain parcels are not
required as an integral part of the Company's properties or are not
indispensable to its operations. All real property hereafter
acquired by the Company and located in counties in which the
Mortgage Indenture shall be of record will, upon acquisition,
become subject to the lien of the Mortgage Indenture, subject,
however, to permitted encumbrances and liens (as defined in the
Mortgage Indenture), any liens existing or placed thereon at
acquisition and any liens which might intervene prior to the filing
or recording of the instrument containing a sufficient legal
description confirming of record that such property is subject to
the lien of the Mortgage Indenture, except as the existence or
validity of the lien of the Mortgage Indenture may be affected by
the application of [Sections 547 and/or 552 ] of the U.S.
Bankruptcy Code or by analogous provisions of applicable state
insolvency laws.

(xi) The Mortgage Indenture has been duly recorded or filed
for record in each county in the States of Wisconsin and Michigan
where any real properties described in such instrument are located and
in all other places required by law in order to perfect the lien upon
the property described in the First Mortgage Indenture.

(xii) The Company has statutory authority, franchises, and
consents free from burdensome restrictions and adequate for the
conduct of the business in which it is engaged as described in the
Final Prospectus, except to the extent that the absence of such
statutory authority or the failure to obtain such franchises or
consents would not, singly or in the aggregate, (A) affect the
security for the Collateral Bonds, or (B) have a material adverse
effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company, whether or not arising from
transactions in the ordinary course of business, except as set forth
or contemplated in the Final Prospectus.

<PAGE>

(xiii) The issuance and delivery by the Company of the
Collateral Bonds to the Trustee constitute a sale by the Company of
the Collateral Bonds to the Trustee as of the Closing Date or, if not
a sale, the grant by the Company to the Trustee of a perfected
security interest in the Collateral Bonds for the benefit of the
holders of the Senior Notes.

(xiv) The Company is not and, after giving effect to the
offering and sale of the Senior Notes and the application of the
proceeds thereof as described in the Final Prospectus, will not be an
"investment company" as defined in the Investment Company Act of 1940,
as amended.

(xv) The Public Service Commission of Wisconsin has duly
authorized the issuance and sale by the Company of the Senior Notes
and the issuance and pledge of the Collateral Bonds on the terms set
forth in the Final Prospectus and this Agreement, and such
authorization is, to the best knowledge of such counsel, in force and
effect and sufficient for the issuance and sale of the Senior Notes to
the Underwriters and the issuance and pledge of the Collateral Bonds
to the Senior Trustee. No consent, approval, authorization, filing
with or order of any court or other governmental agency or body is
required in connection with the transactions contemplated herein,
except such as have been obtained under the Act and the Trust
Indenture Act and such as may be required under the blue sky laws of
any jurisdiction in connection with the purchase and distribution of
the Senior Notes by the Underwriters in the manner contemplated herein
and in the Final Prospectus.

(xvi) The execution and delivery of the Senior Indenture or
the Supplemental Indenture to the Mortgage Indenture, the issuance and
sale of the Senior Notes, the issuance and pledge of the Collateral
Bonds, the consummation of any other of the transactions herein
contemplated or the fulfillment of the terms hereof will not conflict
with, result in a breach or violation of or imposition of any lien,
charge or encumbrance upon any property or assets of the Company
pursuant to, (i) the charter or by-laws of the Company, (ii) the terms
of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument (other than the lien of the Mortgage Indenture)
known to such counsel to which the Company is a party or bound or to
which its property is subject, (iii) any statute, law, rule, or
regulation applicable to the Company, or (iv) any judgment, order or
decree known to such counsel and applicable to the Company of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or
any of its properties.

(xvii) To the knowledge of such counsel, no holders of
securities of the Company have rights to the registration of such
securities under the Registration Statement.

<PAGE>

In rendering such opinion, such counsel (A) may rely as to matters
involving the application of laws of any jurisdiction other than the State
of Wisconsin or the Federal laws of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters, (B) may assume, as to matters
of New York law relating to this Agreement, that New York law does not
differ from Wisconsin law in any material respect, and (C) may rely, as to
matters of fact, to the extent they deem proper, on certificates of
responsible officers of the Company and public officials. References to
the Final Prospectus in this paragraph (b) include any supplements thereto
at the Closing Date.

(c) The Representatives shall have received from Schiff Hardin &
Waite, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date and addressed to the Representatives, with respect to the
issuance and sale of the Senior Notes, the issuance and pledge of the
Collateral Bonds, the Senior Indenture, the Mortgage Indenure,the
Registration Statement, the Final Prospectus (together with any supplement
thereto) and other related matters as the Representatives may reasonably
require, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon
such matters.

(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
President and the principal financial or accounting officer of the Company,
dated the Closing Date, to the effect that the signers of such certificate
have carefully examined the Registration Statement, the Final Prospectus,
any supplements to the Final Prospectus and this Agreement and that:

(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the Closing Date with the same effect as if made on the Closing Date
and the Company has complied with all the agreements and satisfied all
the conditions on its part to be performed or satisfied at or prior to
the Closing Date;

(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge,
threatened; and

(iii) since the date of the most recent financial statements
included or incorporated by reference in the Final Prospectus
(exclusive of any supplement thereto), there has been no material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company, whether or not
arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Final Prospectus (exclusive of
any supplement thereto).

(e) The Company shall have requested and caused Arthur Andersen LLP
to have furnished to the Representatives, at the Execution Time and at the
Closing Date, letters, (which may refer to letters previously delivered to
one or more of the Representatives), dated

<PAGE>

respectively as of the Execution Time and as of the Closing Date, in
form and substance satisfactory to the Representatives, confirming that
they are independent accountants within the meaning of the Act and the
Exchange Act and the respective applicable published rules and
regulations thereunder and stating in effect, except as provided in
Schedule I hereto, that:

(i) in their opinion the audited financial statements and
financial statement schedules included or incorporated by reference in
the Registration Statement and the Final Prospectus and reported on by
them comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the
related published rules and regulations;

(ii) on the basis of a reading of the latest unaudited
financial statements made available by the Company and its
subsidiaries; carrying out certain specified procedures (but not an
examination in accordance with generally accepted auditing
standards) which would not necessarily reveal matters of
significance with respect to the comments set forth in such letter;
a reading of the minutes of the meetings of the stockholders and
directors of the Company; and inquiries of certain officials of the
Company who have responsibility for financial and accounting
matters of the Company and its subsidiaries as to transactions and
events subsequent to December 31, 1997, nothing came to their
attention which caused them to believe that:

(1) any unaudited financial statements included or
incorporated by reference in the Registration Statement and the
Final Prospectus do not comply as to form in all material
respects with applicable accounting requirements of the Act and
with the published rules and regulations of the Commission with
respect to financial statements included or incorporated by
reference in quarterly reports on Form 10-Q under the Exchange
Act; and said unaudited financial statements are not in
conformity with generally accepted accounting principles applied
on a basis substantially consistent with that of the audited
financial statements included or incorporated by reference in the
Registration Statement and the Final Prospectus;

(2) with respect to the period subsequent to
[September 30, 1998], there were any changes, at a specified date
not more than five days prior to the date of the letter, in the
consolidated long-term debt of the Company or capital stock of
the Company or decreases in consolidated net assets or
stockholders' equity of the Company as compared with the amounts
shown on the [September 30, 1998] consolidated balance sheet
included or incorporated by reference in the Registration
Statement and the Final Prospectus, or for the period from
[October 1, 1998] to such specified date there were any
decreases, as compared with the corresponding period in the
preceding year, in consolidated operating revenues or in total
or per share amounts of net income of the Company, except in all
instances for changes or decreases set forth in such letter, in
which case the letter shall be accompanied by an explanation by
the Company as to the significance

<PAGE>

thereof unless said explanation is not deemed necessary by the
Representatives; or

(3) the information included or incorporated by
reference in the Registration Statement and Final Prospectus in
response to Regulation S-K, Item 301 (Selected Financial Data),
Item 302 (Supplementary Financial Information), [Item 402
(Executive Compensation)] and Item 503(d) (Ratio of Earnings to
Fixed Charges) is not in conformity with the applicable
disclosure requirements of Regulation S-K; and

(iii) they have performed certain other specified procedures as
a result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company and its subsidiaries) set
forth in the Registration Statement and the Final Prospectus and in
Exhibit 12 to the Registration Statement, including the information
set forth under the captions "Summary Financial Information" and
"Ratios of Earnings to Fixed Charges " in the Final Prospectus, the
information included or incorporated by reference in Items 1, 2, 6, 7
[and 11] of the Company's Annual Report on Form 10-K, incorporated by
reference in the Registration Statement and the Final Prospectus, and
the information included in the "Management's Discussion and Analysis
of Financial Condition and Results of Operations" included or
incorporated by reference in the Company's Quarterly Reports on
Form 10-Q, incorporated by reference in the Registration Statement and
the Final Prospectus, agrees with the accounting records of the
Company and its subsidiaries, excluding any questions of legal
interpretation.

References to the Final Prospectus in this paragraph (e) include any
supplement thereto at the date of the letter.

(f) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified in
the letter or letters referred to in paragraph (e) of this Section 6 or
(ii) any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Final Prospectus (exclusive of any
supplement thereto) the effect of which, in any case referred to in
clause (i) or (ii) above, is so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of
the Senior Notes as contemplated by the Registration Statement
(exclusive of any amendment thereof) and the Final Prospectus
(exclusive of any supplement thereto).

(g) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities (including
the Senior Notes) by any

<PAGE>

"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act) or any notice given of any
intended or potential decrease in any such rating or of a possible
change in any such rating that does not indicate the direction of the
possible change.

(h) Prior to the Closing Date, the Company shall have furnished to
the Representatives such further information, certificates and documents as
the Representatives may reasonably request.

If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.

The documents required to be delivered by this Section 6 shall be
delivered at the office of Foley & Lardner, counsel for the Company, at 777 East
Wisconsin Avenue, Milwaukee, Wisconsin 53202, on the Closing Date, or at such
other place as may be agreed upon by the Company and the Underwriters.

7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale of the
Senior Notes provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof other than by reason of a
default by any of the Underwriters, the Company will reimburse the Underwriters
severally through Salomon Smith Barney on demand for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been
incurred by them in connection with the proposed purchase and sale of the Senior
Notes.

8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the registration of
the Senior Notes as originally filed or in any amendment thereof, or in the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus, or
in any amendment thereof or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and agrees to reimburse each such indemnified party, as incurred, for any legal
or other expenses reasonably

<PAGE>

incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; PROVIDED, HOWEVER, that the Company will
not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon any such untrue statement
or alleged untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.

(b) Each Underwriter severally and not jointly agrees to indemnify
and hold harmless the Company, each of its directors, each of its officers who
signs the Registration Statement, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, to the same extent as
the foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have.

(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party
(i) will not relieve it from liability under paragraph (a) or (b) above unless
and to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party shall
be entitled to appoint counsel of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
PROVIDED, HOWEVER, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action, or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or

<PAGE>

contribution may be sought hereunder (whether or not the indemnified parties
are actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action, suit
or proceeding.

(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "Losses") to which the Company
and one or more of the Underwriters may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and by the Underwriters on the other from the offering of the Senior Notes;
PROVIDED, HOWEVER, that in no case shall any Underwriter (except as may be
provided in any agreement among underwriters relating to the offering of the
Senior Notes) be responsible for any amount in excess of the underwriting
discount or commission applicable to the Senior Notes purchased by such
Underwriter hereunder. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Company and the Underwriters
severally shall contribute in such proportion as is appropriate to reflect not
only such relative benefits but also the relative fault of the Company on the
one hand and of the Underwriters on the other in connection with the statements
or omissions which resulted in such Losses as well as any other relevant
equitable considerations. Benefits received by the Company shall be deemed to
be equal to the total net proceeds from the offering (before deducting expenses)
received by it, and benefits received by the Underwriters shall be deemed to be
equal to the total underwriting discounts and commissions, in each case as set
forth on the cover page of the Final Prospectus. Relative fault shall be
determined by reference to, among other things, whether any untrue or any
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information provided by the Company on the
one hand or the Underwriters on the other, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution were determined by pro rata
allocation or any other method of allocation which does not take account of the
equitable considerations referred to above. Notwithstanding the provisions of
this paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8, each person who controls an Underwriter within the meaning of
either the Act or the Exchange Act and each director, officer, employee and
agent of an Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company within the meaning of
either the Act or the Exchange Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall have
the same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (d).

9. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters shall
fail to purchase and pay for any of the Senior Notes agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of

<PAGE>

its or their obligations under this Agreement, the remaining Underwriters
shall be obligated severally to take up and pay for (in the respective
proportions which the principal amount of Senior Notes set forth opposite
their names in Schedule II hereto bears to the aggregate principal amount of
Senior Notes set forth opposite the names of all the remaining Underwriters)
the Senior Notes which the defaulting Underwriter or Underwriters agreed but
failed to purchase; PROVIDED, HOWEVER, that in the event that the aggregate
principal amount of Senior Notes which the defaulting Underwriter or
Underwriters agreed but failed to purchase shall exceed 10% of the aggregate
principal amount of Senior Notes set forth in Schedule II hereto, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Senior Notes, and if such
nondefaulting Underwriters do not purchase all the Senior Notes, this
Agreement will terminate without liability to any nondefaulting Underwriter
or the Company. In the event of a default by any Underwriter as set forth in
this Section 9, the Closing Date shall be postponed for such period, not
exceeding five Business Days, as the Representatives shall determine in order
that the required changes in the Registration Statement and the Final
Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Underwriter
of its liability, if any, to the Company and any nondefaulting Underwriter
for damages occasioned by its default hereunder.

10. TERMINATION. This Agreement shall be subject to termination in
the absolute discretion of the Representatives, by notice given to the Company
prior to delivery of and payment for the Senior Notes, if at any time prior to
such time (i) trading in WPSR's common stock shall have been suspended by the
Commission or the New York Stock Exchange or trading in securities generally on
the New York Stock Exchange shall have been suspended or limited or minimum
prices shall have been established on such Exchange, (ii) a banking moratorium
shall have been declared either by Federal, New York State or Wisconsin
authorities or (iii) there shall have occurred any outbreak or escalation of
hostilities, declaration by the United States of a national emergency or war, or
other calamity or crisis the effect of which on financial markets is such as to
make it, in the sole judgment of the Representatives, impractical or inadvisable
to proceed with the offering or delivery of the Senior Notes as contemplated by
the Final Prospectus (exclusive of any supplement thereto).

11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors or controlling persons referred to in Section 8 hereof,
and will survive delivery of and payment for the Senior Notes. The provisions
of Sections 7 and 8 hereof shall survive the termination or cancellation of this
Agreement.

12. NOTICES. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Salomon Smith Barney General Counsel (fax no.:
(212) 816-7912) and confirmed to the General Counsel, Salomon Smith Barney, at
388 Greenwich Street, New York, New York, 10013, Attention: General Counsel;
or, if sent to the Company, will be mailed, delivered or telefaxed to Ralph G.
Baeten, Wisconsin Public Service Corporation (fax no: ___________) and confirmed
to Wisconsin Public

<PAGE>

Service Corporation, 700 North Adams Street, P.O. Box 19001, Green Bay,
Wisconsin, 53407, Attention: Treasurer.

13. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 8 hereof, and no
other person will have any right or obligation hereunder.

14. APPLICABLE LAW. This Agreement will be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed within the State of New York.

15. COUNTERPARTS. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.

16. HEADINGS. The section headings used herein are for convenience
only and shall not affect the construction hereof.

17. DEFINITIONS. The terms which follow, when used in this
Agreement, shall have the meanings indicated.

"Act" shall mean the Securities Act of 1933, as amended and the rules
and regulations of the Commission promulgated thereunder.

"Basic Prospectus" shall mean the prospectus referred to in paragraph
1(a) above contained in the Registration Statement at the Effective Date
including any Preliminary Final Prospectus.

"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City or Milwaukee,
Wisconsin.

"Commission" shall mean the Securities and Exchange Commission.

"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any
Rule 462(b) Registration Statement became or become effective.

"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.

"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.

<PAGE>

"Final Prospectus" shall mean the prospectus supplement relating to
the Senior Notes that was first filed pursuant to Rule 424(b) after the
Execution Time, together with the Basic Prospectus.

"Preliminary Final Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus which describes the Senior Notes and the
offering thereof and is used prior to filing of the Final Prospectus,
together with the Basic Prospectus.

"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective) and, in the
event any post-effective amendment thereto or any Rule 462(b) Registration
Statement becomes effective prior to the Closing Date, shall also mean such
registration statement as so amended or such Rule 462(b) Registration
Statement, as the case may be. Such term shall include any Rule 430A
Information deemed to be included therein at the Effective Date as provided
by Rule 430A.

"Rule 415", "Rule 424", "Rule 430A" and "Rule 462" refer to such rules
under the Act.

"Rule 430A Information" shall mean information with respect to the
Senior Notes and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.

"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b) relating
to the offering covered by the registration statement referred to in
Section 1(a) hereof.

"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended and the rules and regulations of the Commission promulgated
thereunder.

<PAGE>

If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company and the several Underwriters.

Very truly yours,

Wisconsin Public Service Corporation

By:_________________________________
Name:
Title:

The foregoing Agreement is
hereby confirmed and accepted
as of the date specified in
Schedule I hereto.

Salomon Smith Barney Inc.
A.G. Edwards & Sons, Inc.
Legg Mason Wood Walker, Incorporated

By: Salomon Smith Barney Inc.

By:___________________________
Name:
Title:

For themselves and the other
several Underwriters, if any,
named in Schedule II to
the foregoing Agreement.

<PAGE>

SCHEDULE I

Underwriting Agreement dated

Registration Statement No.

Representative(s):

Title, Purchase Price and Description of Senior Notes:

Title:

Principal amount:

Purchase price (include accrued
interest or amortization, if
any):

Sinking fund provisions:

Redemption provisions:

Other provisions:

Closing Date, Time and Location: , 19 at
10:00 a.m. at

Type of Offering: Non-delayed

Date referred to in Section 5(f) after which the Company may offer or sell debt
securities issued or guaranteed by the Company without the consent of the
Representative(s):

Modification of items to be covered by the letter from
Arthur Andersen LLP delivered pursuant to
Section 6(e) at the Execution Time:

<PAGE>

SCHEDULE II
<TABLE>
<CAPTION>
Principal Amount
of Senior Notes to
Underwriters be Purchased
- ------------ ------------------
<S> <C>

Salomon Smith Barney Inc. $

A.G. Edwards & Sons, Inc.

Legg Mason Wood Walker Incorporated
------------------

Total: $
------------------
------------------
</TABLE>

<PAGE>
EXHIBIT 4A

[FORM OF INDENTURE]
- --------------------------------------------------------------------------------

WISCONSIN PUBLIC SERVICE CORPORATION

AS ISSUER

FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION

AS TRUSTEE

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

INDENTURE

SENIOR DEBT SECURITIES

DATED AS OF DECEMBER 1, 1998

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

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

<PAGE>

TABLE OF CONTENTS

PAGE

RECITALS OF THE COMPANY. . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE I DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION . . . . . . . . . . . . . . . . . . . 2

SECTION 1.01. Definitions. . . . . . . . . . . . . . . . . . . . . . 2
(a) "ACT,". . . . . . . . . . . . . . . . . . . . . . . . . . . 2
(b) "AFFILIATE" . . . . . . . . . . . . . . . . . . . . . . . . 2
(c) "AUTHENTICATING AGENT". . . . . . . . . . . . . . . . . . . 2
(d) "BANKRUPTCY LAW". . . . . . . . . . . . . . . . . . . . . . 2
(e) "BOARD OF DIRECTORS". . . . . . . . . . . . . . . . . . . . 3
(f) "BOARD RESOLUTION". . . . . . . . . . . . . . . . . . . . . 3
(g) "BONDHOLDER". . . . . . . . . . . . . . . . . . . . . . . . 3
(h) "BUSINESS DAY," . . . . . . . . . . . . . . . . . . . . . . 3
(i) "CAPITAL LEASE" . . . . . . . . . . . . . . . . . . . . . . 3
(j) "CAPITALIZATION". . . . . . . . . . . . . . . . . . . . . . 3
(k) "COLLATERAL BONDS," . . . . . . . . . . . . . . . . . . . . 3
(l) "COMMISSION". . . . . . . . . . . . . . . . . . . . . . . . 3
(m) "COMPANY" . . . . . . . . . . . . . . . . . . . . . . . . . 3
(n) "COMPANY REQUEST" or "COMPANY ORDER". . . . . . . . . . . . 4
(o) "CORPORATE TRUST OFFICE". . . . . . . . . . . . . . . . . . 4
(p) "COVENANT DEFEASANCE" . . . . . . . . . . . . . . . . . . . 4
(q) "CUSTODIAN" . . . . . . . . . . . . . . . . . . . . . . . . 4
(r) "DEBT". . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(s) "DEFAULT" . . . . . . . . . . . . . . . . . . . . . . . . . 4
(t) "DEFAULTED INTEREST". . . . . . . . . . . . . . . . . . . . 4
(u) "DEFEASANCE". . . . . . . . . . . . . . . . . . . . . . . . 4
(v) "DEPOSITARY". . . . . . . . . . . . . . . . . . . . . . . . 4
(w) "DOLLARS" and "$" . . . . . . . . . . . . . . . . . . . . . 4
(x) "EVENT OF DEFAULT". . . . . . . . . . . . . . . . . . . . . 4
(y) "EXCHANGE ACT". . . . . . . . . . . . . . . . . . . . . . . 4
(z) "EXPERT". . . . . . . . . . . . . . . . . . . . . . . . . . 5
(aa) "FIRST MORTGAGE BONDS". . . . . . . . . . . . . . . . . . . 5
(bb) "FIRST MORTGAGE INDENTURE". . . . . . . . . . . . . . . . . 5
(cc) "GAAP". . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(dd) "GLOBAL SECURITY" . . . . . . . . . . . . . . . . . . . . . 5
(ee) "HOLDER" or "SECURITY HOLDER" . . . . . . . . . . . . . . . 5
(ff) "HYBRID PREFERRED SECURITIES" . . . . . . . . . . . . . . . 5
(gg) "HYBRID PREFERRED SECURITIES SUBSIDIARY". . . . . . . . . . 5

-i-
<PAGE>

(hh) "INDENTURE" . . . . . . . . . . . . . . . . . . . . . . . . 6
(ii) "INITIAL SECURITIES". . . . . . . . . . . . . . . . . . . . 6
(jj) "INTEREST," . . . . . . . . . . . . . . . . . . . . . . . . 6
(kk) "INTEREST PAYMENT DATE,". . . . . . . . . . . . . . . . . . 6
(ll) "JUNIOR SUBORDINATED INDEBTEDNESS". . . . . . . . . . . . . 6
(mm) "LIEN," . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(nn) "MATURITY," . . . . . . . . . . . . . . . . . . . . . . . . 6
(oo) "MORTGAGE," . . . . . . . . . . . . . . . . . . . . . . . . 6
(pp) "MORTGAGE TRUSTEE," . . . . . . . . . . . . . . . . . . . . 6
(qq) "NET TANGIBLE ASSETS" . . . . . . . . . . . . . . . . . . . 6
(rr) "OFFICER" . . . . . . . . . . . . . . . . . . . . . . . . . 7
(ss) "OFFICER'S CERTIFICATE" . . . . . . . . . . . . . . . . . . 7
(tt) "OPERATING PROPERTY". . . . . . . . . . . . . . . . . . . . 7
(uu) "OPINION OF COUNSEL". . . . . . . . . . . . . . . . . . . . 7
(vv) "ORIGINAL ISSUE DISCOUNT SECURITY". . . . . . . . . . . . . 7
(ww) "OUTSTANDING,". . . . . . . . . . . . . . . . . . . . . . . 7
(xx) "PAYING AGENT". . . . . . . . . . . . . . . . . . . . . . . 8
(yy) "PERSON". . . . . . . . . . . . . . . . . . . . . . . . . . 8
(zz) "PLACE OF PAYMENT," . . . . . . . . . . . . . . . . . . . . 8
(aaa) "REDEMPTION DATE,". . . . . . . . . . . . . . . . . . . . . 8
(bbb) "REDEMPTION PRICE," . . . . . . . . . . . . . . . . . . . . 8
(ccc) "REGULAR RECORD DATE" . . . . . . . . . . . . . . . . . . . 8
(ddd) "RELATED SERIES OF COLLATERAL BONDS". . . . . . . . . . . . 8
(eee) "RELATED SERIES OF SECURITIES". . . . . . . . . . . . . . . 9
(fff) "RELATED SERIES OF SUBSTITUTED COLLATERAL BONDS," . . . . . 9
(ggg) "RELEASE DATE," . . . . . . . . . . . . . . . . . . . . . . 9
(hhh) "RESPONSIBLE OFFICER,". . . . . . . . . . . . . . . . . . . 9
(iii) "SALE AND LEASE-BACK TRANSACTION" . . . . . . . . . . . . . 9
(jjj) "SECURITIES". . . . . . . . . . . . . . . . . . . . . . . . 9
(kkk) "SECURITY REGISTER" and "SECURITY REGISTRAR". . . . . . . . 9
(lll) "SPECIAL RECORD DATE" . . . . . . . . . . . . . . . . . . . 9
(mmm) "STATED MATURITY,". . . . . . . . . . . . . . . . . . . . .10
(nnn) "SUBSIDIARY". . . . . . . . . . . . . . . . . . . . . . . .10
(ooo) "SUBSTITUTED COLLATERAL BONDS," . . . . . . . . . . . . . .10
(ppp) "SUBSTITUTED MORTGAGE INDENTURE". . . . . . . . . . . . . .10
(qqq) "TRUST INDENTURE ACT" . . . . . . . . . . . . . . . . . . .10
(rrr) "TRUSTEE" . . . . . . . . . . . . . . . . . . . . . . . . .10
(sss) "U.S. GOVERNMENT OBLIGATIONS" . . . . . . . . . . . . . . .10
(ttt) "VALUE" . . . . . . . . . . . . . . . . . . . . . . . . . .11
(uuu) "VICE PRESIDENT," . . . . . . . . . . . . . . . . . . . . .11
SECTION 1.02. Compliance Certificates and Opinions.. . . . . . . . .11
SECTION 1.03. Form of Documents Delivered to Trustee.. . . . . . . .12

-ii-
<PAGE>

SECTION 1.04. Acts of Holders. . . . . . . . . . . . . . . . . . . .12
SECTION 1.05. Notices, Etc., to Trustee and Company. . . . . . . . .13
SECTION 1.06. Notice to Holders; Waiver. . . . . . . . . . . . . . .13
SECTION 1.07. Conflict with Trust Indenture Act. . . . . . . . . . .14
SECTION 1.08. Effect of Headings and Table of Contents.. . . . . . .14
SECTION 1.09. Successors and Assigns.. . . . . . . . . . . . . . . .14
SECTION 1.10. Separability Clause. . . . . . . . . . . . . . . . . .14
SECTION 1.11. Benefits of Indenture. . . . . . . . . . . . . . . . .15
SECTION 1.12. Governing Law. . . . . . . . . . . . . . . . . . . . .15
SECTION 1.13. Legal Holidays.. . . . . . . . . . . . . . . . . . . .15
SECTION 1.14. No Recourse Against Others.. . . . . . . . . . . . . .15

ARTICLE II SECURITY FORMS . . . . . . . . . . . . . . . . . . . . . . .16
SECTION 2.01. Forms Generally. . . . . . . . . . . . . . . . . . . .16
SECTION 2.02. Form of Face of Security.. . . . . . . . . . . . . . .16
SECTION 2.03. Form of Reverse of Security. . . . . . . . . . . . . .19
SECTION 2.04. Form of Trustee's Certificate of Authentication. . . .25
SECTION 2.05. Securities Issuable in the Form of a Global Security..25
SECTION 2.06. CUSIP Number.. . . . . . . . . . . . . . . . . . . . .27
SECTION 2.07. Payment of Securities. . . . . . . . . . . . . . . . .27

ARTICLE III THE SECURITIES . . . . . . . . . . . . . . . . . . . . . . .29
SECTION 3.01. Amount Unlimited; Issuable in Series.. . . . . . . . .29
SECTION 3.02. Denominations. . . . . . . . . . . . . . . . . . . . .31
SECTION 3.03. Execution, Authentication, Delivery and Dating.. . . .31
SECTION 3.04. Temporary Securities.. . . . . . . . . . . . . . . . .33
SECTION 3.05. Registration, Registration of Transfer and Exchange. .34
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen Securities.. . .35
SECTION 3.07. Payment of Interest; Interest Rights Preserved.. . . .36
SECTION 3.08. Persons Deemed Owners. . . . . . . . . . . . . . . . .37
SECTION 3.09. Cancellation.. . . . . . . . . . . . . . . . . . . . .38
SECTION 3.10. Computation of Interest. . . . . . . . . . . . . . . .38

ARTICLE IV COLLATERAL BONDS; PLEDGED
SUBSTITUTED COLLATERAL BONDS . . . . . . . . . . . . . . . .39
SECTION 4.01. Delivery and Acceptance of Collateral Bonds. . . . . .39
SECTION 4.02. Terms of Collateral Bonds. . . . . . . . . . . . . . .39
SECTION 4.03. Collateral Bonds Held by the Trustee.. . . . . . . . .39
SECTION 4.04. No Transfer of Collateral Bonds; Exception.. . . . . .39
SECTION 4.05. Delivery to the Company of All Collateral Bonds. . . .40
SECTION 4.06. Further Assurances.. . . . . . . . . . . . . . . . . .40
SECTION 4.07. Exchange and Surrender of Collateral Bonds.. . . . . .40

-iii-
<PAGE>

SECTION 4.08. Collateral Bonds as Security for Securities;
Application of Payment on Collateral Bonds. . . . . .41
SECTION 4.09. Substituted Collateral Bonds.. . . . . . . . . . . . .42
SECTION 4.10. Fair Value Certificate . . . . . . . . . . . . . . . .43

ARTICLE V SATISFACTION AND DISCHARGE . . . . . . . . . . . . . . . . .45
SECTION 5.01. Satisfaction and Discharge of Indenture. . . . . . . .45
SECTION 5.02. Application of Trust Money.. . . . . . . . . . . . . .46

ARTICLE VI REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . .47
SECTION 6.01. Events of Default. . . . . . . . . . . . . . . . . . .47
SECTION 6.02. Acceleration of Maturity and Rescission. . . . . . . .48
SECTION 6.03. Collection of Indebtedness and Suits
for Enforcement by Trustee.. . . . . . . . . . . . . .49
SECTION 6.04. Trustee May File Proofs of Claim.. . . . . . . . . . .50
SECTION 6.05. Trustee May Enforce Claims Without Possession of
Securities.. . . . . . . . . . . . . . . . . . . . . .51
SECTION 6.06. Application of Money Collected.. . . . . . . . . . . .51
SECTION 6.07. Limitation on Suits. . . . . . . . . . . . . . . . . .52
SECTION 6.08. Unconditional Right of Holders to Receive Principal,
Premium and Interest.. . . . . . . . . . . . . . . . .52
SECTION 6.09. Restoration of Rights and Remedies.. . . . . . . . . .52
SECTION 6.10. Rights and Remedies Cumulative.. . . . . . . . . . . .53
SECTION 6.11. Delay or Omission Not Waiver.. . . . . . . . . . . . .53
SECTION 6.12. Control by Holders.. . . . . . . . . . . . . . . . . .53
SECTION 6.13. Waiver of Past Defaults. . . . . . . . . . . . . . . .53
SECTION 6.14. Undertaking for Costs. . . . . . . . . . . . . . . . .54
SECTION 6.15. Defaults Under First Mortgage Indenture
or Substituted Mortgage Indenture. . . . . . . . . . .54

ARTICLE VII THE TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . .55
SECTION 7.01. Certain Duties and Responsibilities of the Trustee.. .55
SECTION 7.02. Notice of Defaults.. . . . . . . . . . . . . . . . . .55
SECTION 7.03. Certain Rights of Trustee. . . . . . . . . . . . . . .55
SECTION 7.04. Not Responsible for Recitals or Issuance of
Securities.. . . . . . . . . . . . . . . . . . . . . .56
SECTION 7.05. May Hold Securities. . . . . . . . . . . . . . . . . .56
SECTION 7.06. Money Held in Trust. . . . . . . . . . . . . . . . . .57
SECTION 7.07. Compensation and Reimbursement.. . . . . . . . . . . .57
SECTION 7.08. Disqualification; Conflicting Interests. . . . . . . .57
SECTION 7.09. Corporate Trustee Required; Eligibility. . . . . . . .58
SECTION 7.10. Resignation and Removal; Appointment of Successor. . .58
SECTION 7.11. Acceptance of Appointment by Successor.. . . . . . . .59

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SECTION 7.12. Merger, Conversion, Consolidation or Succession to
Business.. . . . . . . . . . . . . . . . . . . . . . .61
SECTION 7.13. Preferential Collection of Claims Against Company. . .61
SECTION 7.14. Appointment of Authenticating Agent. . . . . . . . . .61

ARTICLE VIII HOLDERS' LISTS AND REPORTS BY TRUSTEE
AND COMPANY. . . . . . . . . . . . . . . . . . . . . . . . .63

SECTION 8.01. Company to Furnish Trustee Names and
Addresses of Holders.. . . . . . . . . . . . . . . . .63
SECTION 8.02. Preservation of Information; Communications
to Holders.. . . . . . . . . . . . . . . . . . . . . .63
SECTION 8.03. Reports by Trustee.. . . . . . . . . . . . . . . . . .64
SECTION 8.04. Reports by Company.. . . . . . . . . . . . . . . . . .65

ARTICLE IX CONSOLIDATION, MERGER, LEASE, SALE OR TRANSFER . . . . . . .66
SECTION 9.01. Then Company May Merge, Etc. . . . . . . . . . . . . .66
SECTION 9.02. Opinion of Counsel.. . . . . . . . . . . . . . . . . .66
SECTION 9.03. Successor Corporation Substituted. . . . . . . . . . .66

ARTICLE X SUPPLEMENTAL INDENTURES. . . . . . . . . . . . . . . . . . .68

SECTION 10.01. Supplemental Indentures Without Consent of Holders.. .68
SECTION 10.02. Supplemental Indentures with Consent of Holders. . . .69
SECTION 10.03. Execution of Supplemental Indentures.. . . . . . . . .70
SECTION 10.04. Effect of Supplemental Indentures. . . . . . . . . . .70
SECTION 10.05. Conformity with Trust Indenture Act. . . . . . . . . .70
SECTION 10.06. Reference in Securities to Supplemental Indentures.. .70

ARTICLE XI COVENANTS. . . . . . . . . . . . . . . . . . . . . . . . . .72
SECTION 11.01. Payments of Principal and Interest.. . . . . . . . . .72
SECTION 11.02. Maintenance of Office or Agency. . . . . . . . . . . .72
SECTION 11.03. Corporate Existence. . . . . . . . . . . . . . . . . .72
SECTION 11.04. Payment of Taxes and Other Claims. . . . . . . . . . .72
SECTION 11.05. Maintenance of Properties. . . . . . . . . . . . . . .73
SECTION 11.06. Opinions of Counsel. . . . . . . . . . . . . . . . . .73
SECTION 11.07. Compliance Certificates. . . . . . . . . . . . . . . .74
SECTION 11.08. Waiver of Stay or Extension. . . . . . . . . . . . . .74
SECTION 11.09. Money for Securities Payments to Be Held in Trust. . .74
SECTION 11.10. Restrictions on Liens. . . . . . . . . . . . . . . . .76
SECTION 11.11. Restrictions on Sale and Lease-Back Transactions.. . .78

ARTICLE XII REDEMPTION OF SECURITIES . . . . . . . . . . . . . . . . . .79
SECTION 12.01. Applicability of Article.. . . . . . . . . . . . . . .79
SECTION 12.02. Election to Redeem; Notice to Trustee. . . . . . . . .79
SECTION 12.03. Election by Trustee of Securities to Be Redeemed.. . .79

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SECTION 12.04. Notice of Redemption.. . . . . . . . . . . . . . . . .80
SECTION 12.05. Deposit of Redemption Price. . . . . . . . . . . . . .80
SECTION 12.06. Securities Payable on Redemption Date. . . . . . . . .81
SECTION 12.07. Securities Redeemed in Part. . . . . . . . . . . . . .81

ARTICLE XIII SINKING FUNDS. . . . . . . . . . . . . . . . . . . . . . . .82
SECTION 13.01. Applicability of Article.. . . . . . . . . . . . . . .82
SECTION 13.02. Satisfaction of Sinking Fund Payments with
Securities.. . . . . . . . . . . . . . . . . . . . . .82
SECTION 13.03. Redemption of Securities for Sinking Fund. . . . . . .82

ARTICLE XIV DEFEASANCE AND COVENANT DEFEASANCE . . . . . . . . . . . . .83

SECTION 14.01. Applicability of Article; Company's Option
to Effect Defeasance or Covenant Defeasance. . . . . .83
SECTION 14.02. Defeasance and Discharge.. . . . . . . . . . . . . . .83
SECTION 14.03. Covenant Defeasance. . . . . . . . . . . . . . . . . .83
SECTION 14.04. Conditions to Defeasance or Covenant Defeasance. . . .84
SECTION 14.05. Deposited Money and Government Obligations
To Be Held In Trust. . . . . . . . . . . . . . . . . .85

ARTICLE XV MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . .87
SECTION 15.01. Miscellaneous. . . . . . . . . . . . . . . . . . . . .87

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WISCONSIN PUBLIC SERVICE CORPORATION
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of December 1, 1998

Trust Indenture
Act Section Indenture Section

Section 310 (a) (1) . . . . . . . . . . . . . . . 7.09
(a) (2) . . . . . . . . . . . . . . . 7.09
(a) (3) . . . . . . . . . . . . . . . Not Applicable
(a) (4) . . . . . . . . . . . . . . . Not Applicable
(a) (5). . . . . . . . . . . . . . . 7.09
(b). . . . . . . . . . . . . . . . . 7.08, 7.10
Section 311 (a). . . . . . . . . . . . . . . . . 7.13
(b). . . . . . . . . . . . . . . . . 7.13
Section 312 (a). . . . . . . . . . . . . . . . . 8.01(a), 8.02(a)
(b). . . . . . . . . . . . . . . . . 8.02(b)
(c). . . . . . . . . . . . . . . . . 8.02(c)
Section 313 (a). . . . . . . . . . . . . . . . . 8.03(a)
(b). . . . . . . . . . . . . . . . . 8.03(b)
(c). . . . . . . . . . . . . . . . . 8.03(a), 8.03(b)
(d). . . . . . . . . . . . . . . . . 8.03(b)
Section 314 (a). . . . . . . . . . . . . . . . . 8.04
(b). . . . . . . . . . . . . . . . . Not Applicable
(c) (1). . . . . . . . . . . . . . . 1.02
(c) (2). . . . . . . . . . . . . . . 1.02
(c) (3). . . . . . . . . . . . . . . Not Applicable
(d). . . . . . . . . . . . . . . . . 4.10
(e). . . . . . . . . . . . . . . . . 1.02
Section 315 (a). . . . . . . . . . . . . . . . . 7.01(a)
(b). . . . . . . . . . . . . . . . . 7.02
(c). . . . . . . . . . . . . . . . . 7.01(b)
(d). . . . . . . . . . . . . . . . . 7.01(c)
(d) (1). . . . . . . . . . . . . . . 7.01(a), 7.01(c)
(d) (2). . . . . . . . . . . . . . . 7.01(c)
(d) (3). . . . . . . . . . . . . . . 7.01(c)
(e). . . . . . . . . . . . . . . . . 6.14
Section 316 (a) (1) (A). . . . . . . . . . . . . 6.12
(a) (1) (B). . . . . . . . . . . . . 6.02, 6.13
(a) (2). . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . 6.08
Section 317 (a) (1). . . . . . . . . . . . . . . 6.03
(a) (2). . . . . . . . . . . . . . . 6.04
(b). . . . . . . . . . . . . . . . . 11.09
Section 318 (a). . . . . . . . . . . . . . . . . 1.07

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

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

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<PAGE>

INDENTURE, dated as of December 1, 1998, between WISCONSIN PUBLIC
SERVICE CORPORATION, a corporation duly organized and existing under the laws of
the State of Wisconsin (herein called the "COMPANY"), having its principal
office at 700 North Adams Street, Green Bay, Wisconsin 54301 and Firstar Bank
Milwaukee, N.A., National Association, a national banking association organized
and existing under and by virtue of the laws of the United States, as Trustee
(herein called the "TRUSTEE").

RECITALS OF THE COMPANY

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

Subject to the provisions of Section 4.08 hereof, the Company may
issue First Mortgage Bonds (as hereinafter defined) and issue and deliver
Collateral Bonds to the Trustee to hold in trust for the benefit of the
respective Holders (as hereinafter defined) from time to time of the Related
Series of Securities. Any payment by the Company of principal of, premium, if
any, and interest on, a series of First Mortgage Bonds will be applied by the
Trustee to satisfy the Company's obligations with respect to the principal of,
premium, if any, and interest on, the Related Series of Securities. Pursuant to
the terms and provisions hereof, the Company may issue and deliver to the
Trustee additional First Mortgage Bonds for such purpose or require the Trustee
to deliver to the Company for cancellation any and all Collateral Bonds held by
the Trustee.

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

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

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

<PAGE>

ARTICLE I

DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION

SECTION 1.01. DEFINITIONS.

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

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

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

(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;

(4) the word "INCLUDING" (and with correlative meaning "INCLUDE")
means including, without limiting the generality of, any description
preceding such term; and

(5) the words "HEREIN," "HEREOF" and "HEREUNDER" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.

Certain terms, used principally in Article Seven, are defined in that
Article.

(a) "ACT,"when used with respect to any Holder, has the meaning
specified in Section 1.04.

(b) "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.
(c) "AUTHENTICATING AGENT" means any Person authorized by the Trustee
to act on behalf of the Trustee to authenticate Securities.

(d) "BANKRUPTCY LAW" means Title 11, U.S. Code or any similar federal
or state law for the relief of debtors.

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<PAGE>

(e) "BOARD OF DIRECTORS" means the board of directors of the Company;
provided, however, that when the context refers to actions or resolutions of the
Board of Directors, then the term "Board of Directors" shall also mean any duly
authorized committee of the Board of Directors of the Company or Officer
authorized to act with respect to any particular matter to exercise the power of
the Board of Directors of the Company.

(f) "BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.

(g) "BONDHOLDER" shall mean the Person in whose name a First Mortgage
Bond is registered in the bond register therefor.

(h) "BUSINESS DAY," when used with respect to any Place of Payment,
means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
which banking institutions in that Place of Payment are authorized or obligated
by law or regulation to close.

(i) "CAPITAL LEASE" shall mean any lease which has been or would be
capitalized on the books of the lessee in accordance with GAAP.

(j) "CAPITALIZATION" shall mean the total of all the following items
appearing on, or included in, the consolidated balance sheet of the Company:
(i) liabilities for indebtedness maturing more than twelve (12) months from the
date of determination; and (ii) common stock, preferred stock, Hybrid Preferred
Securities, premium on capital stock, capital surplus, capital in excess of par
value, and retained earnings (however the foregoing may be designated), less, to
the extent not otherwise deducted, the cost of shares of capital stock of the
Company held in its treasury. Subject to the foregoing, Capitalization shall be
determined in accordance with generally accepted accounting principles and
practices applicable to the type of business in which the Company is engaged and
that are approved by independent accountants regularly retained by the Company,
and may be determined as of a date nor more than sixty (60) days prior to the
happening of an event for which such determination is being made.

(k) "COLLATERAL BONDS," shall mean any First Mortgage Bonds issued by
the Company under the First Mortgage Indenture and issued and delivered to the
Trustee pursuant to Section 4.01.

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

(m) "COMPANY" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor corporation shall have become such
pursuant to

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<PAGE>

the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor corporation.

(n) "COMPANY REQUEST" or "COMPANY ORDER" means a written request or
order signed in the name of the Company by its Chairman of the Board, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its
Controller, an Assistant Controller, its Secretary or an Assistant Secretary,
and delivered to the Trustee.

(o) "CORPORATE TRUST OFFICE" means the principal office of the
Trustee at which at any time its corporate trust business shall be administered,
which office at the date hereof is located at 1555 North RiverCenter Drive,
Suite 301, P.O. Box 2077, Milwaukee, Wisconsin 53201-2077, Attention: Corporate
Trust Department, or such other address as the Trustee may designate from time
to time by notice to the Holders and the Company, or the principal corporate
trust office of any successor Trustee (or such other address as a successor
Trustee may designate from time to time by notice to the Holders and the
Company).

(p) "COVENANT DEFEASANCE" has the meaning specified in Section 14.03.

(q) "CUSTODIAN" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.

(r) "DEBT" means any outstanding debt for money borrowed evidenced by
notes, debentures, bonds or other securities or guarantees of any thereof.

(s) "DEFAULT" means any event which is, or after notice or passage of
time or both would be, an Event of Default.

(t) "DEFAULTED INTEREST" has the meaning specified in Section 3.07.

(u) "DEFEASANCE" has the meaning specified in Section 14.02.

(v) "DEPOSITARY" shall mean, unless otherwise specified pursuant to
Section 3.01 hereof, The Depository Trust Company, New York, New York, or any
successor thereto registered or qualified as a clearing agency under the
Securities Exchange Act of 1934, or other applicable statute or regulation.

(w) "DOLLARS" and "$" means lawful money of the United States of
America.

(x) "EVENT OF DEFAULT" has the meaning specified in Section 6.01.

(y) "EXCHANGE ACT" means the Securities and Exchange Act of 1934, as
amended from time to time, and the rules and regulations promulgated thereunder.

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<PAGE>

(z) "EXPERT" shall mean any officer of the Company familiar with
the terms of the First Mortgage Indenture and this Indenture, any law firm,
any investment banking firm or any other Person satisfactory in the
reasonable judgment of the Trustee.

(aa) "FIRST MORTGAGE BONDS" shall mean all First Mortgage Bonds
issued by the Company and outstanding under the First Mortgage Indenture or
the Substituted Mortgage Indenture, including in all events any Collateral
Bonds or Substituted Collateral Bonds issued and delivered to and held by the
Trustee.

(bb) "FIRST MORTGAGE INDENTURE" shall mean the First Mortgage and
Deed of Trust dated January 1, 1941, to First Wisconsin Trust Company
(succeeded by Firstar Bank Milwaukee, N.A., National Association), Milwaukee,
Wisconsin, as supplemented and amended by the supplemental indentures thereto.

(cc) "GAAP" shall mean generally accepted accounting principles in
the United States of America as in effect on the date hereof, applied on a
basis consistent with those used in the preparation of any financial
statements referred to herein, unless otherwise stated herein.

(dd) "GLOBAL SECURITY" shall mean a Security that, pursuant to
Sections 3.01 and 3.03 hereof, is issued to evidence Securities, that is
delivered to the Depositary or pursuant to the instructions of the Depositary
and that shall be registered in the name of the Depositary or its nominee.

(ee) "HOLDER" or "SECURITY HOLDER" means a Person in whose name a
Security is registered in the Security Register.

(ff) "HYBRID PREFERRED SECURITIES" shall mean any preferred
securities issued by a Hybrid Preferred Securities Subsidiary, where such
preferred securities have the following characteristics:

(i) such Hybrid Preferred Securities Subsidiary lends substantially
all of the proceeds from the issuance of such preferred securities to the
Company in exchange for Junior Subordinated Indebtedness issued by the
Company;

(ii) such preferred securities contain terms providing for the
deferral of interest payments corresponding to provisions providing for the
deferral of interest payments on the Junior Subordinated Indebtedness; and

(iii) the Company makes period interest payments on the Junior
Subordinated Indebtedness, which interest payments are in turn used by the
Hybrid Preferred Securities Subsidiary to make corresponding payments to
the holders of the preferred securities.

(gg) "HYBRID PREFERRED SECURITIES SUBSIDIARY" shall mean any business
trust (or similar entity) (i) all of the common equity interest of which is
owned (either directly or indirectly through one or more wholly-owned
Subsidiaries of the Company or any

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<PAGE>

Consolidated Subsidiary of the Company) at all times by the Company, (ii)
that has been formed for the purpose of issuing Hybrid Preferred Securities
and (iii) substantially all of the assets of which consist at all times
solely of Junior Subordinated Indebtedness issued by the Company and payments
made from time to time on such Junior Subordinated Indebtedness.

(hh) "INDENTURE" means this instrument as originally executed or
as it may from time to time be supplemented or amended by one or more
indentures supplemental hereto entered into pursuant to the applicable
provisions hereof and shall include the terms of particular series of
Securities established as contemplated by Section 3.01.

(ii) "INITIAL SECURITIES" shall mean Securities in an aggregate
principal amount of $________ authenticated and delivered upon the execution
of this Indenture.

(jj) "INTEREST," when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity,
means interest payable after Maturity.

(kk) "INTEREST PAYMENT DATE," when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.

(ll) "JUNIOR SUBORDINATED INDEBTEDNESS" shall mean any unsecured
Debt of the Company (i) issued in exchange for the proceeds of Hybrid
Preferred Securities and (ii) subordinated to the rights of the Holders
hereunder.

(mm) "LIEN," means any lien (statutory or other), mortgage,
pledge, hypothecation, assignment, deposit arrangement, encumbrance or
preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever (including, without limitation, the interest
of a vendor or lessor under any conditional sale, capitalized lease or other
title retention agreement).

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

(oo) "MORTGAGE," shall mean and include any mortgage, pledge, lien
or security interest.

(pp) "MORTGAGE TRUSTEE," shall mean the Person serving as trustee
at the time under the First Mortgage Indenture.

(qq) "NET TANGIBLE ASSETS" shall mean the amount shown as total
assets on the consolidated balance sheet of the Company, less the following:
(i) intangible assets including, but without limitation, such items as
goodwill, trademarks, trade names, patents, and unamortized debt discount and
expense and (ii) appropriate adjustments, if any, on account of minority
interests. Net Tangible Assets shall be determined in accordance with

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<PAGE>

generally accepted accounting principles and practices applicable to the type of
business in which the Company is engaged and that are approved by the
independent accountants regularly retained by the Company, and may be determined
as of a date not more than sixty (60) days prior to the happening of the event
for which such determination is being made.

(rr) "OFFICER" means the Chairman of the Board, the Vice-Chairman
of the Board, the President, any Vice President, the Treasurer, any Assistant
Treasurer, the Controller, the Secretary or any Assistant Secretary of the
Company.

(ss) "OFFICER'S CERTIFICATE" means a certificate signed by an
Officer and delivered to the Trustee.

(tt) "OPERATING PROPERTY" shall mean (i) any interest in real
property owned by the Company and (ii) any asset owned by the Company that is
depreciable in accordance with GAAP, excluding, in either case, any interest
of the Company as lessee under a Capital Lease (except for a lease that
results from a Sale and Lease-Back Transaction).

(uu) "OPINION OF COUNSEL" means a written opinion of counsel, who
may be an employee of or counsel for the Company, and who shall be reasonably
acceptable to the Trustee.

(vv) "ORIGINAL ISSUE DISCOUNT SECURITY" means any Security, which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant
to Section 6.02.

(ww) "OUTSTANDING," when used with respect to Securities or
Securities of any series, means, as of the date of determination, all such
Securities theretofore authenticated and delivered under this Indenture,
except:

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

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

(iii) Securities which have been paid pursuant to Section 3.06 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company; and

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<PAGE>

(iv) Securities which have been defeased pursuant to Section 14.02;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, (a) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding for such purposes shall be that portion of the principal amount
thereof that could be declared to be due and payable upon the occurrence of an
Event of Default and the continuation thereof pursuant to the terms of such
Original Issue Discount Security as of the date of such determination and (b)
Securities owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which the Trustee knows to
be so owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledge establishes
to the satisfaction of the Trustee the pledge's right so to act with respect to
such Securities and that the pledgee is not the Company or any other obligor
upon the Securities or any Affiliate of the Company or of such other obligor.

(xx) "PAYING AGENT" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company. The Company may act as Paying Agent with respect to
any Securities issued hereunder.

(yy) "PERSON" means any individual, corporation, partnership,
joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.

(zz) "PLACE OF PAYMENT," when used with respect to the Securities
of any series, means the place or places where the principal of (and premium,
if any) and interest on the Securities of that series are payable as
specified as contemplated by Section 3.01.

(aaa) "REDEMPTION DATE," when used with respect to any Security
of any series to be redeemed, means the date fixed for such redemption by or
pursuant to this Indenture.

(bbb) "REDEMPTION PRICE," when used with respect to any Security
of any series to be redeemed, means the price at which it is to be redeemed
pursuant to this Indenture.

(ccc) "REGULAR RECORD DATE" for the interest payable on any
Interest Payment Date on the Securities of any series means the date specified
for that purpose as contemplated by Section 3.01.

(ddd) "RELATED SERIES OF COLLATERAL BONDS" shall mean, when used
in reference to a series of Securities, the series of Collateral Bonds having
the same stated rate or rates of interest (or interest calculated in the same
manner), Interest Payment Dates, stated maturity date and redemption provisions,
and in the same aggregate principal

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amount, delivered to the Trustee pursuant to Section 4.01 in connection with the
initial authentication and issuance of such Securities pursuant to Section 3.03.

(eee) "RELATED SERIES OF SECURITIES" shall mean, when used in
reference to a series of Collateral Bonds or Substituted Collateral Bonds, the
series of Securities in respect of which such series of Collateral Bonds or
Substituted Collateral Bonds was delivered to the Trustee pursuant to Section
4.01 or 4.09 hereof upon the initial issuance and authentication of such
series of Securities pursuant to Section 3.03 hereof.

(fff) "RELATED SERIES OF SUBSTITUTED COLLATERAL BONDS" shall mean,
when used in reference to a series of Securities, the series of Substituted
Collateral Bonds, having the same stated rate or rates of interest (or
interest calculated in the same manner), Interest Payment Dates, stated
maturity date and redemption provisions, and in the same aggregate principal
amount, delivered to the Trustee pursuant to Section 4.09.

(ggg) "RELEASE DATE" shall mean the date as of which all First
Mortgage Bonds, other than Collateral Bonds, have been retired through
payment, redemption, or otherwise (including those First Mortgage Bonds the
payment for which has been provided for in accordance with the First Mortgage
Indenture) at, before or after the maturity thereof, provided that no Default
or Event of Default has occurred and is continuing.

(hhh) "RESPONSIBLE OFFICER," when used with respect to the Trustee,
means any vice president, any assistant vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any senior trust officer, any trust officer or assistant
trust officer, the controller or any assistant controller or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and familiarity with the
particular subject.

(iii) "SALE AND LEASE-BACK TRANSACTION" shall mean any arrangement
with any Person providing for the leasing to the Company of any Operating
Property (except for leases for a term, including any renewal thereof, of not
more than forty-eight (48) months), which Operating Property has been or is
to be sold or transferred by the Company to such Person; PROVIDED, HOWEVER,
Sale and Lease-Back Transaction shall not include any arrangement first
entered into prior to the date of this Indenture and shall not include any
transaction pursuant to which the Company sells Operating Property to, and
thereafter purchases energy or services from, any entity which transaction is
ordered or authorized by any regulatory authority having jurisdiction over
the Company or its operations or is entered into pursuant to any plan or
program of industry restructuring ordered or authorized by any such regulatory
authority.

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

(kkk) "SECURITY REGISTER" and "SECURITY REGISTRAR" have the
respective meanings specified in Section 3.05.

(lll) "SPECIAL RECORD DATE" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 3.07.

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<PAGE>

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

(nnn) "SUBSIDIARY" of a Person means (i) any corporation of which
more than 50% of the outstanding securities having ordinary voting power
shall at the time be owned or controlled, directly or indirectly, by such
Person or by one or more of its Subsidiaries or by such Person and one or
more of its Subsidiaries, or (ii) any partnership, association, joint venture
or similar business organization of which more than 50% of the ownership
interests having ordinary voting power shall at the time be so owned or
controlled. Unless otherwise expressly provided, all references herein to a
"Subsidiary" shall mean a Subsidiary of the Company.

(ooo) "SUBSTITUTED COLLATERAL BONDS," shall mean any mortgage bonds
issued by the Company under a Substituted Mortgage Indenture and delivered to
the Trustee pursuant to Section 4.09 hereof.

(ppp) "SUBSTITUTED MORTGAGE INDENTURE" shall mean a mortgage
indenture of the Company designated by the Company to the Trustee as a
Substituted Mortgage Indenture pursuant to Section 4.09.

(qqq) "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939,
as amended, as in force at the date as of which this Indenture was executed;
provided, however, that in the event that such Act is amended after such
date, "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as so
amended.

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

(sss) "U.S. GOVERNMENT OBLIGATIONS" means securities which are (i)
direct obligations of the United States of America for the payment of which
its full faith and credit is pledged or (ii) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of the
United States of America the timely payment of which is unconditionally
guaranteed by the full faith and credit of the United States of America
which, in either case, are not callable or redeemable at the option of the
issuer thereof or otherwise subject to prepayment, and shall also include a
depository receipt issued by a New York Clearing House bank or trust company
as custodian with respect to any such U.S. Government Obligation or a
specific payment or interest on or principal of any such U.S. Government
Obligation held by such custodian for the account of the holder of a
depository receipt, provided that (except as required by law) such custodian
is not authorized to make any deduction from the amount payable to the holder
of such depository receipt or from any

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amount held by the custodian in respect of the U.S. Government Obligation or the
specific payment of interest on or principal of the U.S. Government Obligation
evidenced by such depository receipt.

(ttt) "VALUE" shall mean, with respect to a Sale and Lease-Back
Transaction, as of any particular time, the amount equal to the greater of (i)
the net proceeds to the Company from the sale or transfer of the property leased
pursuant to such Sale and Lease-Back Transaction or (ii) the net book value of
such property, as determined in accordance with generally accepted accounting
principles by the Company at the time of entering into such Sale and Lease-Back
transaction, in either case multiplied by a fraction, the numerator of which
shall be equal to the number of full years of the term of the lease that is part
of such Sale and Lease-Back Transaction remaining at the time of determination
and the denominator of which shall be equal to the number of full years of such
term, without regard to any renewal or extension options contained in such
lease.

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

SECTION 1.02. COMPLIANCE CERTIFICATES AND OPINIONS.

Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, other than as action permitted
by Sections 2.05 and 8.04, the Company shall furnish to the Trustee an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with and an Opinion
of Counsel stating that in the opinion of such counsel all such conditions
precedent, 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 Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.

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

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

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

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

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

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<PAGE>

SECTION 1.03. FORM OF DOCUMENTS DELIVERED TO TRUSTEE.

In any case where several matters are required to be certified by, or
covered by a 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 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 of Counsel may be based, insofar as it relates
to factual matters, upon a certificate or opinion of, or representations by, an
Officer or Officers of the Company stating that the information with respect to
such factual matters is in the possession of the Company, unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.

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

SECTION 1.04. ACTS OF HOLDERS.

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

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

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<PAGE>

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

(e) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other Act, the
Company may, at its option, by or pursuant to a Board Resolution, fix in advance
a record date for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act, but the
Company shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other Act
may be given before or after such record date, but only the Holders of record at
the close of business on such record date shall be deemed to be Holders for the
purposes of determining whether Holders of the requisite proportion of
Outstanding Securities have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act, and for
that purpose the Outstanding Securities shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record date.

SECTION 1.05. NOTICES, ETC., TO TRUSTEE AND COMPANY.

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

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

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

SECTION 1.06. NOTICE TO HOLDERS; WAIVER.

Where this Indenture or any Security provides for notice to Holders of
any event, such notice shall be deemed sufficiently given (unless otherwise
herein or in such Security expressly provided) if in writing and mailed,
first-class postage prepaid, to each

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<PAGE>

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

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

Any request, demand, authorization, direction, notice, consent or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.

SECTION 1.07. CONFLICT WITH TRUST INDENTURE ACT.

If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Indenture by any of
the provisions of the Trust Indenture Act, such required provision shall
control. If any provision of this Indenture modifies or excludes any provision
of the Trust Indenture Act that may be so modified or excluded, the latter
provision shall be deemed to apply to this Indenture as so modified or shall be
excluded, as the case may be.

SECTION 1.08. 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 1.09. SUCCESSORS AND ASSIGNS.

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

SECTION 1.10. SEPARABILITY CLAUSE.

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

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<PAGE>

SECTION 1.11. BENEFITS OF INDENTURE.

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

SECTION 1.12. GOVERNING LAW.

This Indenture and the Securities shall be governed by and construed
in accordance with the laws (other than the choice of law provisions) of the
State of Wisconsin.

SECTION 1.13. LEGAL HOLIDAYS.

In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the
Securities) payment of interest or principal (and premium, if any) need not be
made at such Place of Payment on such date, but may be made on the next
succeeding Business Day or on such other day as may be set out in the Officer's
Certificate pursuant to Section 3.01 at such Place of Payment with the same
force and effect as if made on the Interest Payment Date or Redemption Date, or
at the Stated Maturity, provided that no interest shall accrue for the period
from and after such Interest Payment Date, Redemption Date or Stated Maturity,
as the case may be.

SECTION 1.14. NO RECOURSE AGAINST OTHERS.

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

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ARTICLE II

SECURITY FORMS

SECTION 2.01. FORMS GENERALLY.

The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
Officers executing such Securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 3.03 for the authentication and delivery of such
Securities.

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

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

SECTION 2.02. FORM OF FACE OF SECURITY.

[If the Security is an Original Issue Discount Security, insert--FOR
PURPOSES OF SECTION 1272 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE"), THE AMOUNT OF ORIGINAL ISSUE DISCOUNT (AS DEFINED IN SECTION 1273(a)(1)
OF THE CODE AND TREASURY REGULATION SECTION 1.1273-1(a) WITH RESPECT TO THIS
SECURITY IS _______, THE ISSUE PRICE (AS DEFINED IN TREASURY REGULATION SECTION
1.1273-2) OF THIS SECURITY IS __________, THE ISSUE DATE (AS DEFINED IN SECTION
1275(a)(2) OF THE CODE AND TREASURY REGULATION SECTION 1.1273-2) OF THIS
SECURITY IS _______ AND THE YIELD TO MATURITY OF THIS SECURITY IS ___________.]

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WISCONSIN PUBLIC SERVICE CORPORATION

-------------------------------------
No. _________ [$] _________

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

[If the Security is not to bear interest prior to Maturity,
insert--The principal of this Security shall not bear interest except in the
case of a default in payment of principal upon acceleration, upon redemption or
at Stated Maturity and in such case the overdue principal of this Security shall
bear interest at the rate of ____% per annum (to the extent that the payment of
such interest shall be legally enforceable), which shall accrue from the date of
such default in payment to the date payment of such principal has been made or
duly provided for. Interest on any overdue principal shall be payable on
demand. Any such interest on any overdue principal that is not so paid on
demand shall bear interest at the rate of ___% per annum (to the extent that the
payment of such interest shall be legally enforceable), which shall accrue from
the date of such demand for payment to the date payment of such interest has
been made or duly provided for, and such interest shall also be payable on
demand.]

Payment of the principal of (and premium, if any) and [if applicable,
insert--any such] interest on this Security will be made at the office or agency
of the Company maintained for that purpose in ______, in Dollars [if applicable,
insert--; provided, however, that at the

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<PAGE>

option of the Company payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register].

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

FROM AND AFTER SUCH TIME AS ALL FIRST MORTGAGE BONDS (OTHER THAN
COLLATERAL BONDS) ISSUED UNDER THE FIRST MORTGAGE INDENTURE HAVE BEEN RETIRED
THROUGH PAYMENT, REDEMPTION OR OTHERWISE (INCLUDING THOSE FIRST MORTGAGE BONDS
THE PAYMENT FOR WHICH HAS BEEN PROVIDED FOR IN ACCORDANCE WITH THE FIRST
MORTGAGE INDENTURE) AT, BEFORE OR AFTER THE MATURITY THEREOF AND PROVIDED THAT
NO DEFAULT OR EVENT OF DEFAULT UNDER THE INDENTURE HAS OCCURRED AND IS
CONTINUING (THE "RELEASE DATE"), THE COLLATERAL BONDS SHALL CEASE TO SECURE THE
SECURITIES IN ANY MANNER, AND, AT THE OPTION OF THE COMPANY, THE SECURITIES
EITHER (a) WILL BECOME UNSECURED GENERAL OBLIGATIONS OF THE COMPANY OR (b) WILL
BE SECURED BY FIRST MORTGAGE BONDS ISSUED UNDER AN INDENTURE OTHER THAN THE
FIRST MORTGAGE INDENTURE. IN CERTAIN CIRCUMSTANCES PRIOR TO THE RELEASE DATE AS
PROVIDED IN THE INDENTURE, THE COMPANY IS PERMITTED TO REDUCE THE AGGREGATE
PRINCIPAL AMOUNT OF AN ISSUE OF COLLATERAL BONDS HELD BY THE TRUSTEE, BUT IN NO
EVENT PRIOR TO THE RELEASE DATE TO AN AMOUNT LESS THAN THE AGGREGATE PRINCIPAL
AMOUNT OUTSTANDING OF THE RELATED SERIES OF SECURITIES INITIALLY ISSUED
CONTEMPORANEOUSLY WITH SUCH COLLATERAL BONDS.

[Include the following paragraph if the Company elects to issue
Substituted Collateral Bonds (as defined in the Indenture): The Securities will
be secured by First Mortgage Bonds (the "Collateral Bonds") delivered by the
Company to the Trustee for the benefit of the Holders of the Securities, issued
under [the Substituted Mortgage Indenture (as defined in the Indenture)] from
the Company to ________________, as trustee (the "Mortgage Trustee"). Reference
is made to the Substituted Mortgage Indenture and the Indenture for a
description of the rights of the Trustee as holder of the Substituted Collateral
Bonds, the property mortgaged and pledged under the Substituted Mortgage
Indenture, the rights of the Company and of the Mortgage Trustee in respect
thereof, the duties and immunities of the Mortgage Trustee, the terms and
conditions upon which the Substituted Collateral Bonds are secured and the
circumstances under which additional Substituted Collateral Bonds may be
issued.]

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<PAGE>

Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

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

WISCONSIN PUBLIC SERVICE CORPORATION

By
----------------------------------

Attest:
[SEAL]
- ------------------------

SECTION 2.03. FORM OF REVERSE OF SECURITY.

This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under an Indenture, dated as of December 1, 1998 (herein called the
"Indenture"), between the Company and Firstar Bank Milwaukee, N.A. National
Association, as Trustee (herein called the "Trustee," which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is
one of the series designated on the face hereof[, limited in aggregate principal
amount to $_________].

[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 nor more than 45 days' notice by first class
mail, [if applicable, insert--(l) on ______ in any year commencing with the year
______ and ending with the year _____ through operation of the sinking fund for
this series at a Redemption Price equal to 100% of the principal amount, and
(2)] at any time [on or after _______, _______], as a whole or in part, at the
election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount):

If redeemed [on or before ______________, ____%, and if redeemed]
during the 12-month period beginning ____________________ of the years
indicated,

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

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

[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 nor more than 45 days' notice by first class
mail, (1) on ____________ in any year commencing with the year ____ and ending
with the year ____ through operation of the sinking fund for this series at the
Redemption Prices for redemption through operation of the sinking fund
(expressed as percentages of the principal amount) set forth in the table below,
and (2) at any time [on or after ____________], as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the principal
amount) set forth in the table below:

If redeemed during a 12-month period beginning ________________ of the
years indicated,

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

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

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<PAGE>

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

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

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

[If the Security is not an Original Issue Discount Security, insert --
If any Event of Default with respect to Securities of this series shall occur
and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.] [If the Security is an Original Issue Discount Security, insert --
If an Event of Default with respect to Securities of this series shall occur and
be continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal--insert formula for determining the
amount.] Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal and overdue interest (in each case
to the extent that the payment of such interest shall be legally enforceable),
all of the Company's obligations in respect of the payment of the principal of
and interest, if any, on the Securities of this series shall terminate.

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

The Indenture may be modified by the Company and the Trustee without
consent of any Holder with respect to certain matters as described in the
Indenture. In addition, the Indenture permits, with certain exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of a majority in principal amount of
the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of a majority in
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall bind such Holder and all future Holders of this
Security and of

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<PAGE>

any Security issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.

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

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

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

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

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

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

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

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<PAGE>

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

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

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<PAGE>

ASSIGNMENT FORM

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

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

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

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

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

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

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

Social Security Number or Taxpayer Identification
Number:
--------------------------------------------------

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<PAGE>

SECTION 2.04. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.

Dated:
-----------------------

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

----------------------------------
As Trustee

By
-------------------------------
Authorized Signatory

SECTION 2.05. SECURITIES ISSUABLE IN THE FORM OF A GLOBAL SECURITY.

(a) If the Company shall establish pursuant to Section 3.01 hereof
that the Securities of a particular series are to be issued in whole or in part
in the form of one or more Global Securities, then the Company shall execute and
the Trustee shall, in accordance with Section 3.03 hereof and the Company Order
delivered to the Trustee hereunder, authenticate and deliver such Global
Security or Securities, which (i) represent, shall be denominated in an amount
equal to the aggregate principal amount of, and shall have the same terms as,
the outstanding Securities of such series to be represented by such Global
Security or Securities, (ii) shall be registered in the name of the Depositary
or its nominee, (iii) shall be delivered by the Trustee to the Depositary or
pursuant to the Depositary's instruction and (iv) shall bear a legend
substantially to the following effect: "This Security is a Global Security
registered in the name of the Depositary (referred to herein) or a nominee
thereof and, unless and until it is exchanged in whole or in part for the
individual Securities represented hereby, this Global Security may not be
transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary. Unless this Global Security is
presented by an authorized representative of The Depository Trust Company (55
Water Street, New York, New York), to the Trustee for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or such other name as requested by an authorized representative of
The Depository Trust Company and any payment is made to Cede & Co., any
transfer, pledge or other use hereof for value or otherwise by or to any person
is wrongful since the registered owner hereof, Cede & Co., has an interest
herein" or such other legend as may be required by the rules and regulations of
the Depositary.

(b) Notwithstanding any other provision of Section 3.05 hereof or of
this Section 2.05, unless the terms of a Global Security expressly permit such
Global Security to be exchanged in whole or in part for individual Securities, a
Global Security may be transferred, in whole but not in part, only as described
in the legend thereto.

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<PAGE>

(c) (i) If at any time the Depositary for a Global Security
notifies the Company that it is unwilling or unable to continue as Depositary
for such Global Security or if at any time the Depositary for the Global
Security shall no longer be eligible or in good standing under the Exchange
Act or other applicable statute or regulation, the Company shall appoint a
successor Depositary with respect to such Global Security. If a successor
Depositary for such Global Security is not appointed by the Company within 90
days after the Company receives such notice or becomes aware of such
ineligibility, the Company's election pursuant to Section 3.01(3) hereof
shall no longer be effective with respect to the series of Securities
evidenced by such Global Security and the Company shall execute, and the
Trustee, upon receipt of a Company Order for the authentication and delivery
of individual Securities of such series in exchange for such Global Security,
shall authenticate and deliver, individual Securities of such series of like
tenor and terms in definitive form in an aggregate principal amount equal to
the principal amount of the Global Security in exchange for such Global
Security. The Trustee shall not be charged with knowledge or notice of the
ineligibility of a Depositary unless a responsible officer assigned to and
working in its corporate trustee administration department shall have actual
knowledge thereof.

(ii) The Company may at any time and in its sole discretion
determine that all Outstanding (but not less than all) Securities of a series
issued or issuable in the form of one or more Global Securities shall no
longer be represented by such Global Security or Securities. In such event
the Company shall execute, and the Trustee, upon receipt of a Company Order
for the authentication and delivery of individual Securities in exchange for
such Global Security, shall authenticate and deliver individual Securities of
like tenor and terms in definitive form in an aggregate principal amount
equal to the principal amount of such Global Security or Securities in
exchange for such Global Security or Securities.

(iii) In any exchange provided for in any of the preceding two
paragraphs, the Company will execute and the Trustee will authenticate and
deliver individual Securities in definitive registered form in authorized
denominations. Upon the exchange of a Global Security for individual
Securities, such Global Security shall be cancelled by the Trustee.
Securities issued in exchange for a Global Security pursuant to this Section
shall be registered in such names and in such authorized denominations as the
Depositary for such Global Security, pursuant to instructions from its direct
or indirect participants or otherwise, shall instruct the Trustee. The
Trustee shall deliver such Securities to the Depositary for delivery to the
persons in whose names such Securities are so registered, or if the
Depositary shall refuse or be unable to deliver such Securities, the Trustee
shall deliver such Securities to the persons in whose names such Securities
are registered, unless otherwise agreed upon between the Trustee and the
Company, in which event the Company shall cause the Securities to be
delivered to the persons in whose names such Securities are registered.

(d) Neither the Company, the Trustee, any Authenticating Agent
nor any paying agent shall have any responsibility or liability for any
aspect of the records relating to, or payments made on account of, beneficial
ownership interests of a Global Security or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interest.

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<PAGE>

(e) Pursuant to the provisions of this subsection, at the option of
the Trustee and upon 30 days' written notice to the Depositary but not prior to
the first Interest Payment Date of the respective Global Securities of the same
series, the Depositary shall be required to surrender any two or more Global
Securities of the same series which have identical terms, including, without
limitation, identical maturities, interest rates and redemption provisions to
the Trustee, and the Company shall execute and the Trustee shall authenticate
and deliver to, or at the direction of, the Depositary a Global Security of the
same series in principal amount equal to the aggregate principal amount of, and
with all terms identical to, the Global Securities surrendered thereto. The
exchange contemplated in this subsection shall be consummated at least 30 days
prior to any Interest Payment date applicable to any of the Global Securities
surrendered to the Trustee. Upon any exchange of any Global Security, whether
pursuant to this Section or pursuant to Section 3.05 or Section 12.07 hereof,
the aggregate principal amount of the Securities or a series shall be the same
before and after such exchange, after giving effect to any retirement of
Securities of such series.

SECTION 2.06. CUSIP NUMBER.

The Company in issuing Securities of any series may use a "CUSIP"
number, and, if so, the Trustee may use the CUSIP number in notices of
redemption or exchange as a convenience to Holders of such series; provided,
that any such notice may state that no representation is made as to the
correctness or accuracy of the CUSIP number printed on the notice or on the
Securities of such series, and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption shall
not be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the CUSIP number of any series of
Securities.

SECTION 2.07. PAYMENT OF SECURITIES.

Payment of the principal, interest and premium on all Securities shall
be payable as follows:

(a) On or before 9:30 a.m., New York City time, or such other time as
shall be agreed upon between the Trustee and the Company, of the day on which
payment of principal, interest and premium is due on any Global Security
pursuant to the terms thereof, the Company shall deliver to the Trustee funds
available on such date sufficient to make such payment, by wire transfer of
immediately available funds or by instructing the Trustee to withdraw sufficient
funds from an account maintained by the Company with the Trustee or such other
method as is acceptable to the Trustee. On or before 10:00 a.m., New York City
time, or such other time as shall be agreed upon between the Trustee and the
Depositary, of the day on which any payment of interest is due on any Global
Security (other than at maturity), the Trustee shall pay to the Depositary such
interest in same day funds. On or before 10:00 a.m., New York City time or such
other time as shall be agreed upon between the Trustee and the Depositary, of
the day on which principal, interest payable at maturity and premium, if any, is
due on any Global Security, the Trustee shall deposit with the Depositary the
amount equal to the principal, interest payable at maturity and premium, if any,
by wire transfer into the account specified by the Depositary. As a condition
to the payment, at

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<PAGE>

maturity or upon redemption, of any part of the principal or interest on and
applicable premium of any Global Security, the Depositary shall surrender, or
cause to be surrendered, such Global Security to the Trustee, whereupon a new
Global Security shall be issued to the Depositary pursuant to Section 3.05
hereof.

(b) With respect to any Security that is not a Global Security,
principal, applicable premium and interest due at the maturity of the Security
shall be payable in immediately available funds when due upon presentation and
surrender of such Security at the corporate trust office of the Trustee or at
the authorized office of any paying agent. Interest on any Security that is not
a Global Security (other than interest payable at maturity) shall be paid by
check mailed to the Holder thereof at such Holder's address as it appears on the
register by check payable in clearinghouse funds; PROVIDED that if the Trustee
receives a written request from any Holder of Securities, the aggregate
principal amount of which having the same Interest Payment Date equals or
exceeds $10,000,000, on or before the applicable Regular Record Date for such
Interest Payment Date, interest shall be paid by wire transfer of immediately
available funds to a bank within the continental United States designated by
such Holder in its request or by direct deposit into the account of such Holder
designated by such Holder in its request if such account is maintained with the
Trustee or any paying agent.

(c) The Trustee shall receive the Collateral Bonds or Substituted
Collateral Bonds from the Company as provided in this Indenture and shall hold
the Collateral Bonds or Substituted Collateral Bonds, and any and all sums
payable thereon or with respect thereto or realized therefrom, in trust for the
benefit of the holders of the Securities, as herein provided. All payments made
by or on behalf of the Company to the Trustee on a series of Collateral Bonds or
Substituted Collateral Bonds shall be deemed to be a payment by the Company
pursuant to this Section 2.07 and shall be applied by the Trustee to pay, when
due, principal of, premium, if any, and/or interest on the Related Series of
Securities and, to the extent so applied, shall satisfy the Company's
obligations on such Securities. The Company shall cause payment to be made to
the Trustee of principal of, premium, if any, and (if applicable) interest on a
series of Collateral Bonds in a manner and at a time that will enable the
Trustee to make payments when due, of the principal of, premium, if any, and
interest on the Related Series of Securities.

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<PAGE>

ARTICLE III

THE SECURITIES

SECTION 3.01. AMOUNT UNLIMITED; ISSUABLE IN SERIES.

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

The Securities may be issued from time to time in one or more series.
There shall be established in or pursuant to a Board Resolution, and set forth
in an Officer's Certificate, or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of any series:

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

(2) any limit upon the aggregate principal amount of the Securities
of the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Sections 3.04, 3.05, 3.06, 10.06 or 12.07);

(3) whether any Securities of the series are to be issuable in
permanent global form with or without coupons and, if so, (i) whether
beneficial owners of interests in any such permanent global Security may
exchange such interests for Securities of such series and of like tenor of
any authorized form and denomination and the circumstances under which any
such exchanges may occur, if other than in the manner provided in Sections
2.05 and 3.05, and (ii) the name of the Depositary with respect to any
global Security;

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

(5) the rate or rates at which the Securities of the series shall
bear interest, if any, the date or dates from which such interest shall
accrue, the Interest Payment Dates on which such interest shall be payable
and the Regular Record Date for the interest payable on any Interest
Payment Date and, if applicable to such series of Securities, the basis
points and United States Treasury rate(s) and any other rates to be used in
calculating the reset rate;

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

(7) the period or periods within which, the price or prices at which
and the terms and conditions upon which Securities of the series may be
redeemed, in whole or in part, at the option of the Company, pursuant to
any sinking fund or otherwise;

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<PAGE>

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

(9) the denominations in which Securities of the series shall be
issuable;

(10) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section
6.02;

(11) additional Events of Default with respect to Securities of the
series, if any, other than those set forth herein;

(12) if either or both of Section 14.02 and Section 14.03 shall be
inapplicable to the Securities of the series (provided that if no such
inapplicability shall be specified, then both Section 14.02 and Section
14.03 shall be applicable to the Securities of the series);

(13) if other than U.S. dollars, the currency or currencies or units
based on or related to currencies in which the Securities of such series
shall be denominated and in which payments or principal of, and any premium
and interest on, such Securities shall or may by payable;

(14) additional covenants with respect to Securities of the series, if
any, other than those set forth herein;

(15) if prior to the Release Date, the designation of the Related
Series of Collateral Bonds being delivered to the Trustee in connection
with the issuance of such Securities,

(16) if on or after the Release Date, the designation of the Related
Series of Substituted Collateral Bonds, if any,

(17) if other than the Trustee, the identity of the Registrar and any
Paying Agent; and

(18) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).

All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to such Board Resolution and set forth in such Officer's Certificate or in any
such Indenture supplemental hereto.

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<PAGE>

If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officer's
Certificate setting forth, or providing the manner for determining, the terms of
the Securities of such series.

SECTION 3.02. DENOMINATIONS.

The Securities of each series shall be issuable in registered form
without coupons in such denominations as shall be specified as contemplated by
Section 3.01. In the absence of any such provisions with respect to the
Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.

SECTION 3.03. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.

The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile. The seal of the Company
may be in the form of a facsimile thereof and may be impressed, affixed,
imprinted or otherwise reproduced on the Securities. Typographical and other
minor errors or defects in any such reproduction of the seal or any such
signature shall not affect the validity or enforceability of any Security that
has been duly authenticated and delivered by the Trustee.

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

At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and make such Securities available for
delivery. If the form or terms of the Securities of the series have been
established in or pursuant to one or more Board Resolutions as permitted by
Sections 2.01 and 3.01, in authenticating such Securities, and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to Sections 315(a)
through (d) of the Trust Indenture Act) shall be fully protected in relying
upon, an Opinion of Counsel stating,

(a) if the form of such Securities has been established by or
pursuant to Board Resolution as permitted by Section 2.01, that such form has
been established in conformity with the provisions of this Indenture;

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<PAGE>

(b) if the terms of such Securities have been established by or
pursuant to Board Resolution as permitted by Section 3.01, that such terms have
been established in conformity with the provisions of this Indenture;

(c) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and legally binding
obligations of the Company, enforceable in accordance with their terms, except
to the extent enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting the
enforcement of creditors' rights generally and by the effect of general
principles of equity (regardless of whether enforceability is considered in a
proceeding in equity or at law);

(d) if prior to the Release Date, that the Related Series of
Collateral Bonds being delivered to the Trustee in connection with the issuance
of such Securities when authenticated and delivered by the Mortgage Trustee and
issued by the Company in the manner and subject to any conditions specified in
such Opinion of Counsel, will constitute valid and binding obligations of the
Company, enforceable in accordance with their terms, except to the extent
enforcement may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting the enforcement of creditors' rights
generally and by the effect of general principles of equity (regardless of
whether enforceability is considered in a proceeding in equity or at law) and
except as enforcement of provisions thereof may be limited by state laws
affecting the remedies for the enforcement of the security provided for in the
First Mortgage Indenture; and that such Collateral Bonds are entitled to the
benefit of the First Mortgage Indenture, equally and ratably, with all other
First Mortgage Bonds (if any) outstanding under the First Mortgage Indenture,
except as to sinking fund provisions;

(e) if any Substituted Collateral Bonds are to be delivered, that the
Related Series of Substituted Collateral Bonds being delivered to the Trustee in
connection with the issuance of such Securities when authenticated and delivered
by the trustee under the Substituted Mortgage Indenture and issued by the
Company in the manner and subject to any conditions specified in such Opinion of
Counsel, will constitute valid and binding obligations of the Company,
enforceable in accordance with their terms, except to the extent enforcement may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting the enforcement of creditors' rights generally and
by the effect of general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law) and except as
enforcement of provisions thereof may be limited by state laws affecting the
remedies for the enforcement of the security provided for in the Substituted
Mortgage Indenture; and that such Substituted Collateral Bonds are entitled to
the benefit of the Substituted Mortgage Indenture, equally and ratably, with all
other First Mortgage Bonds (if any) outstanding under the Substituted First
Mortgage Indenture, except as to sinking fund provisions;

(f) that no consent, approval, authorization, order, registration or
qualification of or with any court or any governmental agency or body having
jurisdiction over the Company is required for the execution and delivery of such
Securities by the Company, except

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<PAGE>

such as have been obtained (except that no opinion need be expressed as to state
securities or Blue Sky laws).

If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee, or in the written opinion of
counsel to the Trustee (which counsel may be an employee of the Trustee) such
authentication may not lawfully be made or would involve the Trustee in personal
liability.

Notwithstanding the provisions of Section 3.01 and of the immediately
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officer's
Certificate otherwise required pursuant to Section 3.01 or the Company Order and
Opinion of Counsel otherwise required pursuant to the immediately preceding
paragraph at or prior to the time of authentication of each Security of such
series if such documents are delivered at or prior to the authentication upon
original issuance of the first Security of such series to be issued.

If the Company shall establish pursuant to Section 3.01 that the
Securities of a series are to be issued in the form of one or more global
Securities, then the Company shall execute and the Trustee shall, in accordance
with this section and the Company Order with respect to the authentication and
delivery of such series, authenticate and deliver one or more global Securities
that (i) shall be in an aggregate amount equal to the aggregate principal amount
specified in such Company Order, (ii) shall be registered in the name of the
Depositary therefor or its nominee, and (iii) shall be made available for
delivery by the Trustee to the Depositary or pursuant to the Depositary's
instruction.

Each depositary designated pursuant to Section 3.01 must, at the time
of its designation and at all times while it serves as depositary, be a clearing
agency registered under the Exchange Act and any other applicable statute or
regulation.

Unless otherwise provided for in the form of Security, each Security
shall be dated the date of its authentication.

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

SECTION 3.04. TEMPORARY SECURITIES.

Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
make available for delivery, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive

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Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Securities may determine, as evidenced by their execution of such
Securities.

In the case of Securities of any series, such temporary Securities may
be in global form, representing all or a portion of the Outstanding Securities
of such series.

Except in the case of temporary Securities in global form (which shall
be exchanged in accordance with the provisions of Section 3.05), if temporary
Securities of any series are issued, the Company will cause definitive
Securities of that series to be prepared without unreasonable delay. After the
preparation of definitive Securities of such series, the temporary Securities of
such series shall be exchangeable for definitive Securities of such series upon
surrender of the temporary Securities of such series at the office or agency of
the Company in a Place of Payment for that series, without charge to the Holder.
Upon surrender for cancellation of any one or more temporary Securities of any
series, the Company shall execute and the Trustee shall authenticate and make
available for delivery in exchange therefor a like principal amount of
definitive Securities of the same series of authorized denominations and of like
tenor. Until so exchanged, the temporary Securities of any series shall in all
respects be entitled to the same benefits under this Indenture as definitive
Securities of such series.

If temporary Securities of any series are issued in global form, any
such temporary global Security shall, unless otherwise provided therein, be
delivered to the office of the Depositary therefor for credit to the respective
accounts of the beneficial owners of such Securities (or to such other accounts
as they may direct).

SECTION 3.05. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE.

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

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

At the option of the Holder, Securities of any series may be exchanged
for other Securities of the same series, of any authorized denominations and of
a like aggregate principal amount and Stated Maturity, upon surrender of the
Securities to be exchanged at such office or agency. Whenever any Securities
are so surrendered for exchange, the

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Company shall execute, and the Trustee shall authenticate and make available for
delivery, the Securities which the Holder making the exchange is entitled to
receive.

If the principal amount and applicable premium, of part but not all of
a Global Security is paid, then upon surrender to the Trustee of such Global
Security, the Company shall execute and the Trustee shall authenticate, deliver
and register a Global Security in an authorized denomination in aggregate
principal amount equal to, and having the same terms and of the same series as,
the unpaid portion of such Global Security.

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

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

Unless otherwise provided in the Securities to be transferred or
exchanged, no service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 3.04, 10.06 or 12.07 not involving any transfer.

The Company shall not be required (i) to issue, register the transfer
of or exchange Securities of any series during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of redemption of
Securities of that series selected for redemption under Section 12.03 and ending
at the close of business on the day of such mailing, or (ii) to register the
transfer of or exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of any Security being redeemed in part.

SECTION 3.06. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.

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

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

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Security of the same series and of like tenor and principal amount and bearing a
number not contemporaneously outstanding.

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

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

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

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

SECTION 3.07. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.

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

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

(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this

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Section 3.07 provided. Thereupon the Trustee shall fix a Special Record
Date for the payment of such Defaulted Interest which shall be not more
than 15 days and not less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Trustee of the
notice of the proposed payment. The Trustee shall promptly notify the
Company of such Special Record Date and, in the name and at the expense of
the Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be mailed, first-class
postage prepaid, to each Holder of Securities of such series at his address
as it appears in the Security Register, not less than 10 days prior to such
Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the
Securities of such series (or their respective Predecessor Securities) are
registered at the close of business on such Special Record Date and shall
no longer be payable pursuant to the following Clause (2).

(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Section 3.07, such manner of payment shall be deemed practicable by
the Trustee.

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

SECTION 3.08. PERSONS DEEMED OWNERS.

Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of (and premium, if
any) and (subject to Section 3.07) interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.

None of the Company, the Trustee or any agent of the Company or the
Trustee shall have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interest of a
Security in global form, or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interest. Notwithstanding the
foregoing, with respect to any Security in global form, nothing herein shall
prevent the Company or the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other authorization
furnished by any Depositary (or its nominee), as a Holder, with respect to such
Security in global form or impair, as between such Depositary and owners of
beneficial interests in such Security in

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global form, the operation of customary practices governing the exercise of the
right of such Depositary (or its nominee) as holder of such Security in global
form.

SECTION 3.09. CANCELLATION.

All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Securities so delivered shall be promptly cancelled by the
Trustee. No Securities shall be authenticated in lieu of or in exchange for any
Securities cancelled as provided in this Section, except as expressly permitted
by this Indenture. All cancelled Securities shall be held by the Trustee and
may be destroyed (and, if so destroyed, certification of their destruction shall
be delivered to the Company, unless, by a Company Order, the Company shall
direct that cancelled Securities be returned to it).

SECTION 3.10. COMPUTATION OF INTEREST.

Except as otherwise specified as contemplated by Section 3.01 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a year of twelve 30-day months.

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ARTICLE IV

COLLATERAL BONDS; PLEDGED
SUBSTITUTED COLLATERAL BONDS

SECTION 4.01. DELIVERY AND ACCEPTANCE OF COLLATERAL BONDS.

Upon the issuance of Securities hereunder at any time prior to the
Release Date, the Company shall issue and deliver to the Trustee to hold in
trust for the benefit of the Holders of the Securities as described in Section
4.08, and the Trustee shall accept therefor, a Related Series of Collateral
Bonds registered in the name of the Trustee conforming to the requirements of
Section 4.02.

SECTION 4.02. TERMS OF COLLATERAL BONDS.

Each series of Collateral Bonds delivered to the Trustee pursuant to
Section 4.06 shall have the same stated rate or rates of interest (or interest
calculated in the same manner), Interest Payment Dates, stated maturity date and
redemption provisions, and shall be in the same aggregate principal amount, as
the series of Securities in connection with which such Collateral Bonds shall
have been issued and delivered.

SECTION 4.03. COLLATERAL BONDS HELD BY THE TRUSTEE.

The Trustee, as a Holder of Collateral Bonds, shall attend any meeting
of Bondholders under the First Mortgage Indenture as to which it receives due
notice, or, at its option, shall deliver its proxy in connection therewith.
Either at such meeting, or otherwise where consent of Holders of First Mortgage
Bonds issued under the First Mortgage Indenture is sought without a meeting, the
Trustee shall vote all of the Collateral Bonds held by it, or shall consent or
withhold its consent with respect thereto, as directed by the Holders of not
less than a majority in the aggregate principal amount of the outstanding
Securities; provided, however, that the Trustee shall not vote as such Holder of
any particular series of Collateral Bonds in favor of, or give its consent to,
any action which in the Trustee's opinion, would materially adversely affect
such series of Collateral Bonds in a manner not shared generally by all other
Collateral Bonds, except upon notification by the Trustee to the Holders of the
Related Series of Securities of such proposal and consent thereto of the Holders
of not less than a majority in aggregate principal amount of the outstanding
Securities of such series.

SECTION 4.04. NO TRANSFER OF COLLATERAL BONDS; EXCEPTION.

Except (i) as required to effect an assignment to a successor trustee
under this Indenture, (ii) pursuant to Section 4.05 or Section 4.07 hereof or
(iii) in compliance with a final order of a court of competent jurisdiction in
connection with any bankruptcy or reorganization proceeding of the Company, the
Trustee shall not sell, assign or transfer the Collateral Bonds and the Company
shall issue stop transfer instructions to the Mortgage Trustee and any transfer
agent under the First Mortgage Indenture to effect compliance with this Section
4.04.

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SECTION 4.05. DELIVERY TO THE COMPANY OF ALL COLLATERAL BONDS.

When the obligation of the Company to make payment with respect to the
principal of and premium, if any, and interest on any series of Collateral Bonds
shall cease and be discharged pursuant to Section 4.08 or Section 5.01, the
Trustee shall, upon written request of the Company and receipt of the
certificate of the Expert described in Section 4.10(b) hereof (if such
certificate is then required by Section 4.10(b) hereof), deliver to the Company
all of such Collateral Bonds, together with such appropriate instruments of
transfer or release as may be reasonably requested by the Company. All
Collateral Bonds delivered to the Company in accordance with this Section 4.03
shall be delivered by the Company to the Mortgage Trustee for cancellation.

SECTION 4.06. FURTHER ASSURANCES.

The Company, at its own expense, shall do such further lawful acts and
things, and execute and deliver such additional conveyances, assignments,
assurances, agreements and instruments, as may be necessary in order to better
assign, assure and confirm to the Trustee its interest in the Collateral Bonds
and for maintaining, protecting and preserving such interest. The Trustee may
petition any court of competent jurisdiction to seek any relief it considers
necessary or advisable in order to maintain, protect and preserve such interest.

SECTION 4.07. EXCHANGE AND SURRENDER OF COLLATERAL BONDS.

At any time at the written direction of the Company, the Trustee shall
surrender to the Company all or part of the Collateral Bonds in exchange for
Collateral Bonds equal in aggregate outstanding principal amount to, in
different denominations than, but of the same series and with all other terms
identical to, the Collateral Bonds so surrendered to the Company. In addition,
at any time a Security shall cease to be entitled to any benefit or security
under this Indenture pursuant to Section 5.01, the Trustee shall surrender an
equal principal amount of the Related Series of Collateral Bonds, subject to the
limitations of this Section 4.07, to the Company for cancellation. The Trustee
shall, together with such Collateral Bonds, deliver to the Company such
appropriate instruments of transfer, and such appropriate instruments for
releasing the Company of its obligations under such surrendered Collateral
Bonds, as the Company may reasonably request. Prior to the surrender required
by this paragraph, the Trustee shall receive from the Company, and (subject to
Section 7.01) shall be fully protected in relying upon, an Officers' Certificate
stating (i) the aggregate outstanding principal amount of the Collateral Bonds
of the issue surrendered by the Trustee, after giving effect to such surrender,
(ii) the aggregate outstanding principal amount of the Related Series of
Securities, (iii) that the surrender of the Collateral Bonds will not result in
any default under this Indenture, and (iv) that any Collateral Bonds to be
received in exchange for the Collateral Bonds being surrendered comply with the
provisions of this Section 4.07 and the First Mortgage Indenture.

The Company shall not be permitted to cause the surrender or exchange
of all or any part of an issue of Collateral Bonds contemplated in this Section
4.07, if after such surrender or exchange, the aggregate outstanding principal
amount of the Related Series of

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Securities would exceed the aggregate outstanding principal amount of such issue
of Collateral Bonds held by the Trustee. Any Collateral Bonds received by the
Company pursuant to this Section 4.07 shall be delivered to the Mortgage Trustee
for cancellation. Notwithstanding anything herein to the contrary, until the
Release Date, the Company shall preserve and maintain the lien of this
Indenture, and shall not permit, at anytime prior to the Release Date, the
aggregate principal amount of Collateral Bonds held by the Trustee to be less
than the aggregate amount of Securities Outstanding.

SECTION 4.08. COLLATERAL BONDS AS SECURITY FOR SECURITIES;
APPLICATION OF PAYMENT ON COLLATERAL BONDS.

Until the Release Date and subject to Article Five, the Related Series
of Collateral Bonds delivered to the Trustee, in trust for the benefit of the
Holders of the applicable issue of Securities, shall pay principal of, interest
and premium, if any, in accordance with their respective terms and shall serve
as security for any and all obligations of the Company under such Securities,
including, but not limited to (1) the full and prompt payment of the principal
of and premium, if any, on such Related Series of Securities when and as the
same shall become due and payable in accordance with the terms and provisions of
this Indenture or such Related Series of Securities, either at the stated
maturity thereof, upon acceleration of the maturity thereof, or upon redemption
(any such payment with respect to such Related Series of Securities to be made
by the Company through payment on the Related Series of Collateral Bonds and
applied by the Trustee to satisfy the Company's corresponding obligations under
such Securities), and (2) the full and prompt payment of any interest on such
Related Series of Securities when and as the same shall become due and payable
in accordance with the terms and provisions of this Indenture or such Related
Series of Securities. Any payment by the Company of principal of, premium, if
any, and interest on, a series of First Mortgage Bonds will be applied by the
Trustee to satisfy the Company's obligations with respect to the principal of,
premium, if any, and interest on, the Related Series of Securities.

Notwithstanding anything in this Indenture to the contrary, from and
after the Release Date, the obligation of the Company to make payment with
respect to the principal of and premium, if any, and interest on the Collateral
Bonds shall cease and be discharged as provided in the supplemental trust
indenture or indentures to the First Mortgage Indenture creating such Collateral
Bonds and the Collateral Bonds shall cease to secure in any manner Securities
theretofore or subsequently issued. From and after the Release Date, any
conditions to the issuance of Securities that refer or relate to Collateral
Bonds or the First Mortgage Indenture shall be inapplicable unless the Company
delivers Substituted Collateral Bonds to the Trustee pursuant to Section 4.09
hereof, in which event such provisions shall be deemed to refer or relate to the
Substituted Collateral Bonds. Following the Release Date, the Company shall
cause the First Mortgage Indenture to be discharged and satisfied and the
Company shall not issue any additional First Mortgage Bonds under the First
Mortgage Indenture. Notice of the occurrence of the Release Date shall be given
by the Trustee to the Holders of the Securities in the manner provided in
Section 1.06 not later than 30 days after the Company notifies the Trustee of
the occurrence of the Release Date.

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SECTION 4.09. SUBSTITUTED COLLATERAL BONDS.

(a) The Company shall notify the Trustee not less than 90 days prior
to the Release Date if the Company has determined to deliver to the Trustee on
the Release Date Substituted Collateral Bonds in an aggregate principal amount
equal to the aggregate principal amount of Securities outstanding on the Release
Date in trust for the benefit of the Holders from time to time of the Securities
issued under this Indenture as security for any and all obligations of the
Company under the Securities, including but not limited to, (1) the full and
prompt payment of the principal of and premium, if any, on the Securities when
and as the same shall become due and payable in accordance with the terms and
provisions of this Indenture or the Securities, either at the stated maturity
thereof, upon acceleration of the maturity thereof or upon redemption, and (2)
the full and prompt payment of any interest on the Securities when and as the
same shall become due and payable in accordance with the terms and provisions of
this Indenture or the Securities.

(b) The Substituted Collateral Bonds to be delivered pursuant to the
notice described in Section 4.09 (a) shall be delivered in separate series and
issues corresponding to the series and issues of Securities outstanding on the
Release Date, each issue of Substituted Collateral Bonds having the same stated
rate or rates of interest (or interest calculated in the same manner), Interest
Payment Dates, stated maturity date and redemption provisions, and in the same
aggregate principal amount, as the Related Series of Securities outstanding on
the Release Date.

(c) The notice described in Section 4.09(a) shall also state that on
the Release Date the Company shall deliver to the Trustee a supplemental
indenture to this Indenture that will provide, among other things, that upon the
issuance of Securities hereunder on or after the Release Date, the Company shall
deliver to the Trustee in trust for the benefit of the Holders as described in
Section 4.09(a), and the Trustee shall accept therefor, a Related Series of
Substituted Collateral Bonds registered in the name of the Trustee and
conforming to the requirements therein specified.

(d) The determination whether to issue and deliver Substituted
Collateral Bonds shall be made in the Company's sole discretion and without any
obligation to do so.

(e) In the event that the Company does not deliver the notice
described in Section 4.09(a), the Securities outstanding on the Release Date
shall, as of the Release Date, no longer be entitled to the benefit of the
security of the Collateral Bonds and shall thereafter be general unsecured
obligations of the Company.

(f) Following the delivery of Substituted Collateral Bonds to the
Trustee pursuant to this Section 4.09, all of the provisions of this Indenture
relating to Collateral Bonds and the First Mortgage Indenture shall also apply
to the Substituted Collateral Bonds and the Substituted Mortgage Indenture, to
the same extent as if the Substituted Collateral Bonds and Substituted Mortgage
Indenture were expressly referred to therein.

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SECTION 4.10. FAIR VALUE CERTIFICATE

(a) Upon the delivery by the Company to the Trustee of Collateral
Bonds pursuant to Section 4.06 hereof, or Substituted Collateral Bonds pursuant
to Section 4.09 hereof, the Company shall simultaneously therewith deliver to
the Trustee a certificate of an Expert (1) stating that it is familiar with the
provisions of such Collateral Bonds or Substituted Collateral Bonds and of this
Indenture; (2) stating the principal amount of such Collateral Bonds or
Substituted Collateral Bonds so delivered, the stated interest rate (or method
of calculation of interest) of such Collateral Bonds or Substituted Collateral
Bonds and the stated maturity date of such Collateral Bonds or Substituted
Collateral Bonds; (3) identifying the Securities being issued contemporaneously
therewith, and (4) stating the fair value to the Company of such Collateral
Bonds or Substituted Collateral Bonds. If the fair value to the Company of the
Collateral Bonds or Substituted Collateral Bonds so delivered, as described in
the certificate to be delivered pursuant to this Section 4.10(a), both (w) is
equal to or exceeds (i) $25,000 and (ii) 1% of the principal amount of the
Securities outstanding at the date of delivery of such Collateral Bonds or
Substituted Collateral Bonds and (x) together with the fair value to the
Company, as described in the certificates to be delivered pursuant to this
Section 4.10(a), of all other Collateral Bonds or Substituted Collateral Bonds
delivered to the Trustees since the commencement of the then current calendar
year, is equal to or exceeds 10% of the principal amount of the Securities
Outstanding at the date of delivery of such Collateral Bonds or Substituted
Collateral Bonds, then the certificate required by this Section 4.10 (a) shall
(y) be delivered by an Expert who shall be independent of the Company and
satisfactory to the Trustee in its reasonable judgement and (z) shall, in
addition to the verifications described above, state the fair value to the
Company of all Collateral Bonds or Substituted Collateral Bonds delivered to the
Trustee pursuant to Section 4.08 or 4.09 hereof since the commencement of the
then current year as to which a certificate was not delivered by an Expert
independent of the Company.

(b) If Collateral Bonds or Substituted Collateral Bonds are delivered
or surrendered to the Company pursuant to Section 4.03 or 4.05 hereof, the
Company shall simultaneously therewith deliver to the Trustee a certificate of
an Expert (1) stating that it is familiar with the provisions of such Collateral
Bonds or Substituted Collateral Bonds and of this Indenture, (2) stating the
principal amount of such Collateral Bonds or Substituted Collateral Bonds so
delivered, the stated interest rate (or method of calculation of interest) of
such Collateral Bonds or Substituted Collateral Bonds, (3) if applicable,
identifying the Securities, the payment of the interest on and principal of
which has been discharged hereunder, and (4) stating that such delivery and
release will not impair the lien of this Indenture in contravention of the
provisions of this Indenture. If the fair value of the Collateral Bonds or
Substituted Collateral Bonds so delivered and released, as described in the
certificate to be delivered pursuant to this Section 4.10(b), both (1) is equal
to or exceeds (i) $25,000 and (ii) 1% of the principal amount of the outstanding
Securities at the date of release of such Collateral Bonds or Substituted
Collateral Bonds and (2) together with the fair value, as described in the
certificates to be delivered pursuant to this Section 4.10(b), of all other
Collateral Bonds or Substituted Collateral Bonds released from the lien of this
Indenture since the commencement of the then current calendar year, is equal to
or exceeds 10% of the principal amount of the Securities Outstanding at the date
of release of such Collateral Bonds

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or Substituted Collateral Bonds, then the certificate required by this Section
4.10(b) shall be delivered by an Expert who shall be independent of the Company.

If, in connection with a delivery or release of outstanding Collateral
Bonds or Substituted Collateral Bonds, the Company provides to the Trustee and
Opinion of Counsel stating that the certificate described by this Section 4.10
is not required by law, such certificate shall not be required to be delivered
hereunder in connection with such delivery or release.

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ARTICLE V

SATISFACTION AND DISCHARGE

SECTION 5.01. SATISFACTION AND DISCHARGE OF INDENTURE.

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

(1) all Securities theretofore authenticated and delivered (other
than (A) Securities which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 3.06 and (B) Securities for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or discharged from
such trust, as provided in Section 11.08) have been delivered to the Trustee for
cancellation; or

(2) all such Securities not theretofore delivered to the Trustee
for cancellation

(A) have become due and payable, or

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

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

and the Company, in the case of (A), (B) or (C) above, has deposited with the
Trustee as trust funds in trust for the purpose an amount sufficient to pay and
discharge the entire indebtedness on such Securities not theretofore delivered
to the Trustee for cancellation, for principal (and premium, if any) and
interest to the date of such deposit (in the case of Securities which have
become due and payable) or the Stated Maturity or Redemption Date, as the case
may be;

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

(c) the Company has delivered to the Trustee an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent provided
for herein relating to the satisfaction and discharge of this Indenture have
been complied with.

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Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 7.07, the obligations of
the Company to any Authenticating Agent under Section 7.14 and, if money shall
have been deposited with the Trustee pursuant to subclause (2) of clause (a) of
this Section 5.01, the obligations of the Trustee under Section 5.02 and the
last paragraph of Section 11.08 shall survive.

If the Company shall have paid or caused to be paid in whole or in
part the principal of and premium, if any, and interest on any Security, as and
when the same shall become due and payable or the Company shall have delivered
to the Trustee for cancellation any outstanding Security, such Security shall
cease to be entitled to the lien, benefit or security interest under this
Indenture to the extent of such amounts paid. Upon a Security of any series
ceasing to be entitled to the lien, benefit or security under this Indenture,
the obligation of the Company to make payment with respect to principal of and
premium, if any, and interest on a principal amount of the Related Series of
Collateral Bonds or Related Series of Substituted Collateral Bonds equal to the
principal amount of such Security shall be satisfied and discharged and such
portion of the principal amount of such Collateral Bonds or Substituted
Collateral Bonds shall cease to secure the Securities in any manner.

SECTION 5.02. APPLICATION OF TRUST MONEY.

Subject to the provisions of the last paragraph of Section 11.08, all
money deposited with the Trustee pursuant to Section 5.01 shall be held in trust
and applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with or
received by the Trustee.

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ARTICLE VI

REMEDIES

SECTION 6.01. EVENTS OF DEFAULT.

"EVENT OF DEFAULT," wherever used herein with respect to Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or to be
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):

(1) the Company defaults in the payment of interest on any Security
when such interest becomes due and payable and, if such default occurs
prior to the Release Date, such default continues for a period of 90 days
or, if such default occurs on or after the Release Date, such default
continues for a period of 30 days; or

(2) the Company defaults in the payment of the principal of (or
premium, if any, on) any Security when the same becomes due and payable at
Maturity, upon redemption (including redemptions under Article Twelve), or
otherwise; or

(3) the Company fails to observe or perform any of its other
covenants, warranties or agreements in the Securities of that series or
this Indenture (other than a covenant, agreement or warranty a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with or which has expressly been included in this Indenture solely
for the benefit of series of Securities other than that series), and the
failure to observe or perform continues for the period and after the notice
specified in the last paragraph of this Section; or

(4) prior to the Release Date, a completed default (as defined in the
First Mortgage Indenture under which Collateral Bonds are outstanding) has
occurred and is continuing; PROVIDED, HOWEVER, that anything in this
Indenture to the contrary notwithstanding, the waiver or cure of such
default under the First Mortgage Indenture and the rescission and annulment
of the consequences thereof under the First Mortgage Indenture shall
constitute a waiver of the corresponding Event of Default hereunder and a
rescission and annulment of the consequences thereof hereunder; or

(5) if any Substituted Collateral Bonds are outstanding, an event of
default or completed default (as defined in the Substituted Mortgage
Indenture) has occurred and is continuing; PROVIDED, HOWEVER, that anything
in this Indenture to the contrary notwithstanding, the waiver or cure of
such default under the Substituted Mortgage Indenture and the rescission
and annulment of the consequences thereof under the Substituted Mortgage
Indenture shall constitute a waiver of the corresponding Event of Default
hereunder and a rescission and annulment of the consequences thereof
hereunder; or

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(6) the Company pursuant to or within the meaning of any Bankruptcy
Law (A) commences a voluntary case or proceeding under any Bankruptcy Law
with respect to itself, (B) consents to the entry of a judgment, decree or
order for relief against it in an involuntary case or proceeding under any
Bankruptcy Law, (C) consents to or acquiesces in the institution of
bankruptcy or insolvency proceedings against it, (D) applies for, consents
to or acquiesces in the appointment of or taking possession by a Custodian
of the Company or for any material part of its property, (E) makes a
general assignment for the benefit of its creditors or (F) takes any
corporate action in furtherance of or to facilitate, conditionally or
otherwise, any of the foregoing; or

(7) (i) a court of competent jurisdiction enters a judgment, decree
or order for relief in respect of the Company in an involuntary case or
proceeding under any Bankruptcy Law which shall (A) approve as properly
filed a petition seeking reorganization, arrangement, adjustment or
composition in respect of the Company, (B) appoint a Custodian of the
Company or for any material part of its property or (C) order the
winding-up or liquidation of its affairs, and such judgment, decree or
order shall remain unstayed and in effect for a period of 60 consecutive
days; or (ii) any bankruptcy or insolvency petition or application is
filed, or any bankruptcy or insolvency proceeding is commenced against the
Company and such petition, application or proceeding is not dismissed
within 60 days; or (iii) a warrant of attachment is issued against any
material portion of the property of the Company which is not released
within 60 days of service, or

(8) any other Event of Default provided with respect to Securities of
that series.

A Default under clause (3) above is not an Event of Default until the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Outstanding Securities of that series notify the Company of the Default and the
Company does not cure the Default within 90 days after receipt of the notice if
such Default occurs prior to the Release Date or within 60 days after receipt of
the notice if such Default occurs on or after the Release Date. The notice must
specify the Default, demand that it be remedied and state that the notice is a
"Notice of Default." When a Default under clause (3) above is cured within such
90-day period or 60-day period, as applicable, it ceases.

SECTION 6.02. ACCELERATION OF MATURITY AND RESCISSION.

If an Event of Default with respect to Securities of any series (other
than an Event of Default specified in clause (6) or (7) of Section 6.01) occurs
and is continuing, the Trustee by notice in writing to the Company, or the
Holders of at least 25% in aggregate principal amount of the Outstanding
Securities of that series by notice in writing to the Company and the Trustee,
may declare the unpaid principal of and accrued interest to the date of
acceleration (or, if the Securities of that series are Original Issue Discount
Securities, such portion of the principal amount as may be specified in the
terms of that series) on all the Outstanding Securities of that series to be due
and payable immediately and, upon any such declaration, the Outstanding
Securities of that series (or specified principal amount) shall

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become and be immediately due and payable. In addition, the Trustee shall
immediately file with the Mortgage Trustee a written demand for redemption of
all of the Related Series of Collateral Bonds with respect to such series, to
the extent provided in the applicable provisions of the First Mortgage
Indenture, or, if applicable, a written demand for redemption of all of the
Related Series of Substituted Collateral Bonds with respect to such series,
pursuant to the applicable provisions of the Substituted Mortgage Indenture.

If an Event of Default specified in clause (6) or (7) of Section 6.01
occurs, all unpaid principal of and accrued interest on the Outstanding
Securities of that series (or specified principal amount) shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holder of any Security of that series. In
addition, the Trustee shall immediately file with the Mortgage Trustee a written
demand for redemption of all Collateral Bonds pursuant to the applicable
provisions of the First Mortgage Indenture or, if applicable, a written demand
for redemption of all Substituted Collateral Bonds pursuant to the applicable
provisions of the Substituted Mortgage Indenture.

Upon payment of all such principal and interest, all of the Company'
obligations under the Securities of that series and (upon payment of the
Securities of all series) this Indenture shall terminate, except obligations
under Section 7.07.

The Holders of not less than a majority in principal amount of the
Outstanding Securities of that series by notice to the Trustee may rescind an
acceleration and its consequences (including, if given, the written demand for
redemption of all Collateral Bonds or, if applicable, all Substituted Collateral
Bonds), if (i) all existing Events of Default, other than the nonpayment of the
principal of and interest on the Securities of that series that has become due
solely by such declaration of acceleration, have been cured or waived, (ii) to
the extent the payment of such interest is lawful, interest on overdue
installments of interest and overdue principal that has become due otherwise
than by such declaration of acceleration have been paid, (iii) the rescission
would not conflict with any judgment or decree of a court of competent
jurisdiction and (iv) all payments due to the Trustee and any predecessor
Trustee under Section 7.07 have been made.

SECTION 6.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.

The Company covenants that if:

(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and, (A) if such default occurs
prior to the Release Date, such default continues for a period of 90
days, or, (B) if such default occurs on or after the Release Date, such
default continues for a period of 30 days, or

(2) default is made in the payment of the principal of (or premium,
if any, on) any Security at Maturity, upon redemption (including redemption
under Article XII) or otherwise,

the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal (and premium, if any) and interest and, to the extent
that payment of such interest shall be legally

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enforceable, interest on any overdue principal (and premium, if any) and on any
overdue interest, at the rate or rates prescribed therefor in such Securities,
and, in addition thereto, such further amount as shall be sufficient to cover
the reasonable costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.

If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon such Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon such Securities, wherever
situated.

If an Event of Default hereunder occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights, including its
rights as holder of the Collateral Bonds or the Substituted Collateral Bonds,
and the rights of the Holders of Securities by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in this Indenture or in aid of the exercise of any power granted herein, or to
secure any other proper remedy.

SECTION 6.04. TRUSTEE MAY FILE PROOFS OF CLAIM.

In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,

(i) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest owing and unpaid in respect of the Securities
and to file such other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agent and counsel) and of the Holders allowed in such judicial
proceedings, and

(ii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable

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compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under Section
7.07.

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

SECTION 6.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES.

All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.

SECTION 6.06. APPLICATION OF MONEY COLLECTED.

Any money collected by the Trustee pursuant to this Article in respect
of the Securities of any series shall be applied in the following order, at the
date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal (or premium, if any) or interest, upon
presentation of the Securities in respect of which moneys have been collected
and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:

First: To the payment of all amounts due the Trustee under Section
7.07 applicable to such series;

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

Third: To the Company.

The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 6.06. At least fifteen (15) days before such
record date, the Trustee shall mail to each Holder and the Company a notice that
states the record date, the payment date and the amount to be paid.

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SECTION 6.07. LIMITATION ON SUITS.

No Holder of any Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:

(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;

(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;

(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;

(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and

(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority
in principal amount of the Outstanding Securities of that series;

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

SECTION 6.08. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST.

Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 3.07) interest on such Security on the Stated Maturity or Maturities
expressed in such Security (or, in the case of redemption, on the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
rights shall not be impaired without the consent of such Holder.

SECTION 6.09. RESTORATION OF RIGHTS AND REMEDIES.

If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee

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and the Holders shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding has been instituted.

SECTION 6.10. RIGHTS AND REMEDIES CUMULATIVE.

Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 3.06, no right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.

SECTION 6.11. DELAY OR OMISSION NOT WAIVER.

No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.

SECTION 6.12. CONTROL BY HOLDERS.

The Holders of a majority in principal amount of the Outstanding
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Securities of such series, provided that:

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

(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction; and

(3) subject to Section 7.01, the Trustee need not take any action
which might involve the Trustee in personal liability or be unduly
prejudicial to the Holders not joining therein.

SECTION 6.13. WAIVER OF PAST DEFAULTS.

The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may by written notice to the Trustee on
behalf of the Holders of all the Securities of such series waive any Default or
Event of Default with respect to such series and its consequences, except a
Default or Event of Default

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(1) in respect of the payment of the principal of (or premium, if
any) or interest on any Security of such series, or

(2) in respect of a covenant or other provision hereof which under
Article Ten cannot be modified or amended without the consent of the Holder
of each Outstanding Security of such series affected.

Upon any such waiver, such Default or Event of Default shall cease to
exist and shall be deemed to have been cured, for every purpose of this
Indenture and the Securities of such series; but no such waiver shall extend to
any subsequent or other Default or Event of Default or impair any right
consequent thereon.

SECTION 6.14. UNDERTAKING FOR COSTS.

All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the Outstanding Securities of any series, or to any suit instituted by
any Holder for the enforcement of the payment of the principal of (or premium,
if any) or interest on any Security on or after the Stated Maturity or
Maturities expressed in such Security (or, in the case of redemption, on or
after the Redemption Date).

SECTION 6.15. DEFAULTS UNDER FIRST MORTGAGE INDENTURE OR SUBSTITUTED
MORTGAGE INDENTURE.

In addition to every other right and remedy provided herein, the
Trustee may exercise any right or remedy available to the Trustee in its
capacity as owner and holder of Collateral Bonds or Substituted Collateral Bonds
which arises as a result of a default under the First Mortgage Indenture or the
Substituted Mortgage Indenture.

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ARTICLE VII

THE TRUSTEE

SECTION 7.01. CERTAIN DUTIES AND RESPONSIBILITIES OF THE TRUSTEE.

(a) Except during the continuance of an Event of Default, the
Trustee's duties and responsibilities under this Indenture shall be governed by
Section 315 (a) of the Trust Indenture Act.

(b) In case an Event of Default has occurred and is continuing, and
is known to the Trustee, the Trustee shall exercise the rights and powers vested
in it by this Indenture, and shall use the same degree of care and skill in
their exercise, as a prudent man would exercise or use under the circumstances
in the conduct of his own affairs.

SECTION 7.02. NOTICE OF DEFAULTS.

Within 30 days after the occurrence of any Default or Event of Default
with respect to the Securities of any series, the Trustee shall give to all
Holders of Securities of such series, as their names and addresses appear in the
Security Register, notice of such Default or Event of Default known to the
Trustee, unless such Default or Event of Default shall have been cured or
waived; provided, however, that, except in the case of a Default or Event of
Default in the payment of the principal of (or premium, if any) or interest on
any Security of such series or in the payment of any sinking fund installment
with respect to Securities of such series, the 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
Trustee in good faith determine that the withholding of such notice is in the
interest of the Holders of Securities of such series.

SECTION 7.03. CERTAIN RIGHTS OF TRUSTEE.

Subject to the provisions of the Trust Indenture Act:

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

(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;

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(c) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officer's Certificate;

(d) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;

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

(f) prior to the occurrence of an Event of Default with respect to
the Securities of any series and after the curing or waiving of all such Events
of Default which may have occurred, the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, approval or other paper or document, or the books and records of the
Company, unless requested in writing to do so by the Holders of a majority in
principal amount of the outstanding Securities of any series; provided, however,
that if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is not, in the opinion of the Trustee, reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such costs, expenses or
liabilities as a condition to so proceeding; the reasonable expense of every
such investigation shall be paid by the Company or, if paid by the Trustee,
shall be repaid by the Company upon demand;

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

SECTION 7.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

The recitals herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee or any Authenticating Agent assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities. Neither the Trustee nor any
Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.

SECTION 7.05. MAY HOLD SECURITIES.

The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may

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become the owner or pledgee of Securities and, subject to Sections 7.08 and
7.13, may otherwise deal with the Company with the same rights it would have if
it were not Trustee, Authenticating Agent, Paying Agent, Security Registrar or
such other agent.

SECTION 7.06. MONEY HELD IN TRUST.

Money held by the Trustee in trust hereunder (including amounts held
by the Trustee as Paying Agent) need not be segregated from other funds except
to the extent required by law. The Trustee may allow and credit the Company
interest on any money received by it hereunder at such rate, if any, as may be
agreed upon by the Company and the Trustee from time to time as may be permitted
by law.

SECTION 7.07. COMPENSATION AND REIMBURSEMENT.

The Company agrees

(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);

(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and

(3) to indemnify the Trustee for, and to hold it harmless against,
any loss, liability, damage, claim or expense, including taxes (other than
taxes based upon or determined or measured by the income of the Trustee),
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder.

When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 6.01(6) or Section 6.01(7), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency or
other similar law.

The provisions of this Section 7.07 shall survive this Indenture.

SECTION 7.08. DISQUALIFICATION; CONFLICTING INTERESTS.

The Trustee shall be disqualified only where such disqualification is
required by Section 310(b) of the Trust Indenture Act, provided that, to the
extent permitted by law,

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Firstar Bank Milwaukee, National Association, shall not be deemed to have a
conflicting interest for purposes of Section 310(b) of the Trust Indenture Act
because of its capacity as trustee under the First Mortgage Indenture or the
Substituted Mortgage Indenture. Nothing shall prevent the Trustee from filing
with the Commission the application referred to in the second to last paragraph
of Section 310(b) of the Trust Indenture Act.

SECTION 7.09. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.

There shall at all times be a Trustee hereunder which shall be
eligible to act as Trustee under Section 310(a) (1) of the Trust Indenture Act
having a combined capital and surplus of at least $50,000,000 subject to
supervision or examination by federal or State authority. 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. Neither the Company nor any Person directly
or indirectly controlling, controlled by, or under common control with the
Company may serve as Trustee. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.

SECTION 7.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 7.11.

(b) The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 7.11 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.

(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company.

(d) If at any time:

(1) the Trustee shall fail to comply with Section 310(b) of the Trust
Indenture Act after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Security for at least six
months; or

(2) the Trustee shall cease to be eligible under Section 7.09 and
shall fail to resign after written request therefor by the Company or by
any such Holder of a Security who has been a bona fide Holder of a Security
for at least six months; or

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(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;

then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (ii) subject to Section 315(e) of the
Trust Indenture Act, any Holder who has been a bona fide Holder of a Security
for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee with respect to all Securities and the appointment of a successor
Trustee or Trustees.

(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of one or more
or all of such series and that at any time there shall be only one Trustee with
respect to the Securities of any particular series) and shall comply with the
applicable requirements of Section 7.11. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
7.11, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company with
respect to such Securities. If no successor Trustee with respect to the
Securities of any series shall have been so appointed by the Company or the
Holders and accepted appointment in the manner required by Section 7.11, any
Holder who has been a bona fide Holder of a Security of such series for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.

(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
by mailing written notice of such event by first-class mail, postage prepaid, to
all Holders of Securities of such series as their names and addresses appear in
the Security Register. Each notice shall include the name of the successor
Trustee with respect to the Securities of such series and the address of its
Corporate Trust Office.

SECTION 7.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment,

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and thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee; but, on the request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder.

(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture, the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates.

(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.

(d) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under the Trust Indenture Act.

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SECTION 7.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS.

Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.

SECTION 7.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

The Trustee shall comply with Section 311(a) of the Trust Indenture
Act, excluding any creditor relationship listed in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent indicated therein.

SECTION 7.14. APPOINTMENT OF AUTHENTICATING AGENT.

At any time when any of the Securities remain Outstanding the Trustee
may appoint an Authenticating Agent or Agents with respect to one or more series
of Securities which shall be authorized to act on behalf of, and subject to the
direction of, the Trustee to authenticate Securities of such series issued upon
exchange, registration of transfer or partial redemption thereof or pursuant to
Section 3.06, and Securities so authenticated shall be entitled to the benefits
of this Indenture and shall be valid and obligatory for all purposes as if
authenticated by the Trustee hereunder. Wherever reference is made in this
Indenture to the authentication and delivery of Securities by the Trustee or the
Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
an Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.

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Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.

An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice
of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve, as their names and addresses appear in the Security Register. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.

The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section.

If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternate
certificate of authentication in the following form:

Form of Authenticating Agent's
Certificate of Authentication

Dated:
------------------

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

----------------------------------------
As Trustee
By
-------------------------------------
As Authenticating Agent

By
-------------------------------------
Authorized Signatory

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ARTICLE VIII

HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY

SECTION 8.01. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
HOLDERS.

The Company will furnish or cause to be furnished to the Trustee:

(a) semi-annually, not later than January 1 and July 1 in each year,
a list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders as of the preceding December 15 or June 15, as the case
may be; and

(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished;

provided, however, that so long as the Trustee is the Security Registrar, no
such list shall be required to be furnished.

SECTION 8.02. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.

(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 8.01 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 8.02 upon receipt of a new list so furnished.

(b) If three or more Holders (herein referred to as "applicants")
apply in writing to the Trustee, and furnish to the Trustee 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 Indenture 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 Trustee shall, within five Business Days after the receipt of
such application, at its election, either

(i) afford such applicants access to the information preserved at the
time by the Trustee in accordance with Section 8.02(a); or

(ii) inform such applicants as to the approximate number of Holders
whose names and addresses appear in the information preserved at the time
by the Trustee in accordance with Section 8.02 (a), and as to the
approximate cost of mailing to such Holders the form of proxy or other
communication, if any, specified in such application.

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If the Trustee shall elect not to afford such applicants access to
such information, the Trustee shall, upon the written request of such
applicants, mail to each Holder whose name and address appears in the
information preserved at the time by the Trustee in accordance with Section 8.02
(a) a copy of the form of proxy or other communication which is specified in
such request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the best
interest of the Holders or would be in violation of applicable law. Such
written statement shall specify the basis of such opinion. If the Commission,
after opportunity for a hearing upon the objections specified in the written
statement so filed, shall enter an order refusing to sustain any of such
objections or if, after the entry of an order sustaining one or more of such
objections, the Commission shall find, after notice and opportunity for hearing,
that all objections so sustained have been met and shall enter an order so
declaring, the Trustee shall mail copies of such material to all such Holders
with reasonable promptness after the entry of such order and the renewal of such
tender; otherwise the Trustee shall be relieved of any obligation or duty to
such applicants respecting their application.

(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the company nor the Trustee
nor any agent of either of them shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the Holders
in accordance with Section 8.02(b), regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Section 8.02(b).

SECTION 8.03. REPORTS BY TRUSTEE.

(a) Within 60 days after May 15 of each year commencing with the year
1999, the Trustee shall transmit by mail to all Holders of Securities as
provided in Section 313(c) of the Trust Indenture Act, a brief report dated as
of May 15, if required by and in compliance with Section 313(a) of the Trust
Indenture Act.

(b) The Trustee shall from time to time transmit by mail to all
Holders of Securities as provided in Section 313(c) of the Trust Indenture Act
brief reports that comply, both as to content and date of delivery, with Section
313(b) of the Trust Indenture Act (to the extent required by such Section).

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

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SECTION 8.04. REPORTS BY COMPANY.

The Company shall:

(1) file with the Trustee, within 30 days after the Company is
required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Company may be required to file
with the Commission pursuant to Section 13 or Section 15(d) of the Exchange
Act; or, if the Company is not required to file information, documents or
reports pursuant to either of said Sections, then it shall file with the
Trustee and the Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of the supplementary
and periodic information, documents and reports which may be required
pursuant to Section 13 of the Exchange Act in respect of a security listed
and registered on a national securities exchange as may be prescribed from
time to time in such rules and regulations;

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

(3) transmit by mail to all Holders, as their names and addresses
appear in the Security Register, within 30 days after the filing thereof
with the Trustee, such summaries of any information, documents and reports
required to be filed by the Company pursuant to paragraphs (1) and (2) of
this Section as may be required by rules and regulations prescribed from
time to time by the Commission; and

(4) furnish to the Trustee, on or before May 1 of each year, a brief
certificate from the principal executive officer, principal financial
officer or principal accounting officer as to his or her knowledge of the
Company's compliance with all conditions and covenants under this
Indenture. For purposes of this paragraph, such compliance shall be
determined without regard to any period of grace or requirement of notice
provided under this Indenture. Such certificate need not comply with
Section 1.02.

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ARTICLE IX

CONSOLIDATION, MERGER, LEASE, SALE OR TRANSFER

SECTION 9.01. THEN COMPANY MAY MERGE, ETC.

The Company shall not consolidate with, or merge with or into any
other corporation (whether or not the Company shall be the surviving
corporation), or sell, assign, transfer or lease all or substantially all of its
properties and assets as an entirety or substantially as an entirety to any
Person or group of affiliated Persons, in one transaction or a series of related
transactions, unless:

(1) either the Company shall be the continuing Person or the Person
(if other than the Company) formed by such consolidation or with which or
into which the Company is merged or the Person (or group of affiliated
Persons) to which all or substantially all the properties and assets of the
Company as an entirety or substantially as an entirety are sold, assigned,
transferred or leased shall be a corporation (or constitute corporations)
and shall expressly assume, by an indenture supplemental hereto, executed
and delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Securities and this Indenture and, if
prior to the Release Date, shall expressly assume, by an indenture
supplemental to the Mortgage Indenture or, if on or after the Release Date,
by an indenture supplemental to any Substituted Mortgage Indenture, all of
the obligations of the Company under any outstanding Collateral Bonds or
Substituted Collateral Bonds and under the Mortgage Indenture or any
Substituted Mortgage Indenture, executed and delivered to the Mortgage
Trustee or the trustee under any Substituted Mortgage Indenture, as the
case may be, in form satisfactory to the Mortgage Trustee or the trustee
under the Substituted Mortgage Indenture; and

(2) immediately before and after giving effect to such transaction or
series of related transactions, no Event of Default, and no Default, shall
have occurred and be continuing.

SECTION 9.02. OPINION OF COUNSEL.

The Company shall deliver to the Trustee prior to the proposed
transaction(s) covered by Section 9.01 an Officer's Certificate and an Opinion
of Counsel stating that the transaction(s) and such supplemental indenture
comply with this Indenture and that all conditions precedent to the consummation
of the transaction(s) under this Indenture have been met.

SECTION 9.03. SUCCESSOR CORPORATION SUBSTITUTED.

Upon any consolidation by the Company with or merger by the Company
into any other corporation or any lease, sale, assignment, or transfer of all or
substantially all of the property and assets of the Company in accordance with
Section 9.01, the successor corporation formed by such consolidation or into
which the Company is merged or the

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successor corporation or affiliated group of corporations to which such lease,
sale, assignment, or transfer is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture with
the same effect as if such successor corporation or corporations had been named
as the Company herein, and thereafter, except in the case of a lease, the
predecessor corporation or corporations shall be relieved of all obligations and
covenants under this Indenture and the Securities and in the event of such
conveyance or transfer, except in the case of a lease, any such predecessor
corporation may be dissolved and liquidated.

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ARTICLE X

SUPPLEMENTAL INDENTURES

SECTION 10.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.

Without notice to or the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:

(1) to evidence the succession of another corporation to the Company
and the assumption by any such successor of the covenants of the Company
herein and in the Securities; or

(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Company; or

(3) to add any additional Events of Default with respect to all or
any series of Securities; or

(4) to add or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons; or

(5) to change or eliminate any of the provisions of this Indenture,
provided that any such change or elimination shall become effective only
when there is no Security Outstanding of any series created prior to the
execution of such supplemental indenture which is entitled to the benefit
of such provision; or

(6) to establish the form or terms of Securities of any series as
permitted by Sections 2.01 and 3.01; or

(7) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 7.11(b); or

(8) to cure any ambiguity, defect or inconsistency or to correct or
supplement any provision herein which may be inconsistent with any other
provision herein; or

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(9) to make any change that does not materially adversely affect the
interests of the Holders of Securities of any series.

Upon request of the Company, accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and upon receipt
by the Trustee of the documents described in (and subject to the last sentence
of) Section 10.03, the Trustee shall join with the Company in the execution of
any supplemental indenture authorized or permitted by the terms of this
Indenture.

SECTION 10.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.

With the written consent of the Holders of a majority in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee
shall, subject to Section 10.03, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Securities of such series
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding Security affected
thereby,

(1) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable upon the redemption thereof or extend the time for payment thereof,
or reduce the amount of the principal of an Original Issue Discount
Security that would be due and payable upon a declaration of acceleration
of the Maturity thereof pursuant to Section 6.02, or change any Place of
Payment where, or the coin or currency in which, any Security or any
premium or the interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or impair the interest hereunder of the Trustee in the
Collateral Bonds or Substituted Collateral Bonds, or reduce the principal
amount of any issue of Collateral Bonds (except, as provided in this
Indenture, upon the Release Date) or Substituted Collateral Bonds to an
amount less than the principal amount of the Related Series of Securities
or alter the payment provisions of such Collateral Bonds or Substituted
Collateral Bonds in a manner adverse to the Holders of the Securities, in
each case without the consent of the Holder of each Security so affected;
or

(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver of compliance with certain provisions of this Indenture or
Defaults or Events of Default hereunder and their consequences provided for
in this Indenture; or

(3) change the redemption provisions (including Article Twelve)
hereof in a manner adverse to such Holder; or

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(4) modify any of the provisions of this Section or Section 6.13,
except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby;
provided, however, that this clause shall not be deemed to require the
consent of any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section, or the deletion of this
proviso, in accordance with the requirements of Sections 7.11(b) and
10.01(7).

A supplemental indenture which changes or eliminates any covenant or other
provisions of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.

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

SECTION 10.03. EXECUTION OF SUPPLEMENTAL INDENTURES.

The Trustee shall sign any supplemental indenture authorized pursuant
to this Article, subject to the last sentence of this Section 10.03. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 7.01) shall be fully protected in relying upon, an Officer's
Certificate and an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.

SECTION 10.04. EFFECT OF SUPPLEMENTAL INDENTURES.

Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.

SECTION 10.05. CONFORMITY WITH TRUST INDENTURE ACT.

Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.

SECTION 10.06. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.

Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental

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indenture. If the Company shall so determine, new Securities of any series so
modified as to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series.

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ARTICLE XI

COVENANTS

SECTION 11.01. PAYMENTS OF PRINCIPAL AND INTEREST.

With respect to each series of Securities, the Company will duly and
punctually pay the principal of (and premium, if any) and interest on such
Securities in accordance with their terms and this Indenture, and will duly
comply with all the other terms, agreements and conditions contained in, or made
in the Indenture for the benefit of, the Securities of such series.

SECTION 11.02. MAINTENANCE OF OFFICE OR AGENCY.

The Company will maintain an office or agency in each Place of Payment
where Securities may be surrendered for registration of transfer or exchange or
for presentation for payment, where notices and demands to or upon the Company
in respect of the Securities and this Indenture may be served. The Company will
give prompt written notice to the Trustee of the location, and any change in
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee as set forth in Section
1.05.

The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.

Unless otherwise set forth in, or pursuant to, a Board Resolution or
Indenture supplemental hereto with respect to a series of Securities, the
Company hereby initially designates the Corporate Trust Office of Firstar Bank
Milwaukee, National Association, in Milwaukee, Wisconsin, as such office of the
Company.

SECTION 11.03. CORPORATE EXISTENCE.

Subject to Article IX, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and the rights (charter and statutory) and franchises of the Company;
provided, however, that the Company shall not be required to preserve any such
right or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company.

SECTION 11.04. PAYMENT OF TAXES AND OTHER CLAIMS.

The Company will pay or discharge, or cause to be paid or discharged,
before the same shall become delinquent, (l) all material taxes, assessments and
governmental charges

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levied or imposed upon the Company or upon the income, profits or property of
the Company, and (2) all lawful claims for labor, materials and supplies which,
if unpaid, might by law become a material lien upon the property of the Company;
provided, however, that the Company shall not be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or validity is being contested in good faith by
appropriate proceedings and for which adequate provision has been made.

SECTION 11.05. MAINTENANCE OF PROPERTIES.

The Company will cause all material properties used or useful in the
conduct of its business to be maintained and kept in good condition, repair and
working order (normal wear and tear excepted) and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary, so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of such properties, or
disposing of any of them, if such discontinuance or disposal is, in the judgment
of the Board of Directors, desirable in the conduct of the business of the
Company.

SECTION 11.06. OPINIONS OF COUNSEL. The Company will cause this
Indenture, any indentures supplemental to this Indenture, and any financing or
continuation statements to be promptly recorded and filed and rerecorded and
refiled in such a manner and in such places, as may be required by law in order
fully to preserve, protect and perfect the security of the Holders and all
rights of the Trustee, and shall deliver to the Trustee:

(a) Promptly after the execution and delivery of this Indenture and
of any indenture supplemental to this Indenture but prior to the Release date,
an Opinion of Counsel either stating that, in the opinion of such counsel, this
Indenture or such supplemental indenture and any financing of continuation
statements have been properly recorded and filed so as to make effective and to
perfect the interest of the Trustee in the Collateral Bonds intended to be
created by this Indenture for the benefit of the Holders from time to time of
the Securities, and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to perfect or make such
interest effective and stating what, if any, action of the foregoing character
may reasonably be expected to become necessary prior to the next succeeding
May 1 to maintain, perfect and make such interest effective; and

(b) On or before May 1 of each year, commencing May 1, 1999, and
prior to the Release Date, an Opinion of Counsel either stating that in the
opinion of such counsel such action has been taken, since the date of the most
recent Opinion of Counsel furnished pursuant to this Section 11.06(b) or the
first Opinion of Counsel furnished pursuant to Section 11.06(a) hereof, with
respect to the recording, filing, rerecording, or refiling of this Indenture,
each supplemental indenture and any financing or continuation statements, as is
necessary to maintain and perfect the interest of the Trustee in the Collateral
Bonds intended to be created by this Indenture for the benefit of the Holders
from time to time of the Securities, and

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reciting the details of such action, or stating that in the opinion of such
counsel no such action is necessary to maintain and perfect such interest and
stating what, if any, action of the foregoing character may reasonably be
expected to become necessary prior to the next succeeding May 1 to maintain,
perfect and make such security interest effective.

SECTION 11.07. COMPLIANCE CERTIFICATES.

(a) The Company shall deliver to the Trustee within 90 days after the
end of each fiscal year of the Company (which fiscal year currently ends on
December 31), an Officer's Certificate stating whether or not the signer knows
of any Default or Event of Default by the Company that occurred prior to the end
of the fiscal year and is then continuing. If the signer does know of such a
Default or Event of Default, the certificate shall describe each such Default or
Event of Default and its status and the specific section or sections of this
Indenture in connection with which such Default or Event of Default has
occurred. The Company shall also promptly notify the Trustee in writing should
the Company's fiscal year be changed so that the end thereof is on any date
other than the date on which the Company's fiscal year currently ends. The
certificate need not comply with Section 1.02.

(b) The Company shall deliver to the Trustee, within 10 days after
the occurrence thereof, notice of any default which with the giving of notice
and the lapse of time would be an Event of Default within the meaning of Section
6.01(4) or (5).

(c) The Company shall deliver to the Trustee forthwith upon becoming
aware of a Default or Event of Default (but in no event later than 10 days after
the occurrence of each Default or Event of Default that is continuing), an
Officer's Certificate setting forth the details of such Default or Event of
Default and the action that the Company proposes to take with respect thereto
and the specific section or sections of this Indenture in connection with which
such Default or Event of Default has occurred.

SECTION 11.08. WAIVER OF STAY OR EXTENSION.

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

SECTION 11.09. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.

If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest on any of the Securities of that
series, segregate and hold in trust for the

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benefit of the Persons entitled thereto a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due until such sums shall be paid
to such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of its action or failure so to act.

Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, prior to each due date of the principal of (and
premium, if any) or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal, premium or interest, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its action
or failure to so act.

The Company will cause each Paying Agent for any series of Securities
(other than the Trustee) to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to the provisions
of this Section, that such Paying Agent will:

(1) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest on Securities of that series in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to
such Persons or otherwise disposed of as herein provided;

(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities of that series) in the making of any
payment of principal And premium, if any) or interest on the Securities of
that series; and

(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.

The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.

Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of (and premium, if
any) or interest on any Security of any series and remaining unclaimed for two
years after such principal (and premium, if any) or interest has become due and
payable shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon

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cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in New York, New York,
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance or such money then remaining will be repaid to the
Company.

SECTION 11.10. RESTRICTIONS ON LIENS.

(a) So long as any Securities are outstanding, the Company will not
issue, assume, guarantee or permit to exist after the Release Date any Debt
secured by any Lien on any Operating Property of the Company, whether owned at
the date of this Indenture or thereafter acquired, without in any such case
effectively securing the outstanding Securities (together with, if the Company
shall so determine, any other Debt of or guaranteed by the Company ranking
equally with, the Securities) equally and ratably with such Debt (but only so
long as such Debt is so secured); PROVIDED, HOWEVER, that the foregoing
restriction shall not apply to Debt secured by any of the following:

(i) Liens on any Operating Property existing at the time of
acquisition thereof (which Liens may also extend to subsequent repairs,
alterations and improvements to such Operating Property);

(ii) Liens on operating property of a corporation existing at the
time such corporation is merged into or consolidated with the Company, or
at the time of a sale, lease, or other disposition of the properties of
such corporation or a division thereof as an entirety or substantially as
an entirety to the Company;

(iii) Liens on Operating Property to secure all or part of the
cost of acquiring, constructing, developing, or substantially repairing,
altering, or improving such property, or to secure indebtedness incurred to
provide funds for any such purpose or for reimbursement of funds previously
expended for any such purpose, provided such Liens are created or assumed
contemporaneously with, or within eighteen (18) months after, such
acquisition or the completion of construction, development, or substantial
repair, alteration or improvement;

(iv) Liens in favor of any State, or any department, agency, or
instrumentality or political subdivision of any State, or for the benefit
of holders of securities issued by any such entity (or providers of credit
enhancement with respect to such securities), to secure any Debt
(including, without limitation, obligations of the Company with respect to
industrial development, pollution control or similar revenue bonds)
incurred for the purpose of financing all or any part of the purchase price
or the cost of constructing, developing, or substantially repairing,
altering, or improving Operating Property of the Company;

(v) Any Lien created by any Substituted Mortgage Indenture
securing Substituted Collateral Bonds;

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(vi) Any extension, renewal or replacement (or successive
extensions, renewals, or replacements), in whole or in part, of any Lien
referred to in the foregoing clauses (i) to (v), inclusive; PROVIDED,
HOWEVER, that the principal amount of Debt secured thereby and not
otherwise authorized by said clauses (i) to (v), inclusive, shall not
exceed the principal amount of Debt, plus any premium or fee payable in
connection with any such extension, renewal, or replacement, so secured at
the time of such extension, renewal, or replacement.

(b) Notwithstanding the provisions of Section 11.10(a), the Company
may issue, assume, or guarantee Debt, or permit to exist after the Release Date
any Debt, in each case, secured by Liens which would otherwise be subject to the
restrictions of Section 11.10(a) up to an aggregate principal amount that,
together with the principal amount of all other Debt of the Company secured by
Liens (other than Liens permitted by Section 11.10(a) that would otherwise be
subject to any of the foregoing restrictions) and the Value of all Sale and
Lease-Back Transactions in existence at such time (other than (i) any Sale and
Lease-Back Transaction that, if such Sale and Lease-Back Transaction had been a
Lien, would have been permitted by Section 11.10(a), (ii) Sale and Lease-Back
Transactions permitted by Section 11.11 because the commitment by or on behalf
of the purchaser was obtained no later than eighteen (18) months after the later
of events described in (i) or (ii) of Section 11.11, and (iii) Sale and
Lease-Back Transactions as to which application of amounts have been made in
accordance with clause (z) of Section 11.11), does not at the time exceed the
greater of ten percent (10%) of Net Tangible Assets or ten percent (10%)
of Capitalization.

(c) If the Company shall issue, assume, or guarantee any Debt secured
by any Lien and if Section 11.10(a) requires that the outstanding Securities be
secured equally and ratably with such Debt, the Company will promptly execute,
at its expense, any instruments necessary to so equally and ratably secure the
outstanding Securities and deliver the same to the Trustee along with:

(ii) An Officers' Certificate stating that the covenant of the
Company contained in Section 11.10(a) has been complied with; and

(iii) An Opinion of Counsel to the effect that the Company has
complied with the covenant contained in Section 11.10(a), and that any
instruments executed by the Company in the performance of such covenant comply
with the requirements of such covenant.

In the event that the Company shall hereafter secure outstanding
Securities equally and ratably with any other obligation or indebtedness
pursuant to the provisions of this Section 11.10, the Company will, upon the
request of the Trustee, enter into an indenture or agreement supplemental hereto
and take such other action, if any, as the Trustee may reasonably request to
enable it to enforce effectively the rights of the Holders of outstanding
Securities so secured, equally and ratably with such other obligation or
indebtedness.

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SECTION 11.11. RESTRICTIONS ON SALE AND LEASE-BACK TRANSACTIONS. So
long as any Securities are outstanding, the Company will not enter into or
permit to exist after the Release Date any Sale and Lease-Back Transaction with
respect to any Operating Property if, in any case, the commitment by or on
behalf of the purchaser is obtained more than eighteen (18) months after the
later of (i) the completion of the acquisition, construction, or development of
such Operating Property or (ii) the placing in operation of such Operating
Property or of such Operating Property as constructed, developed, or
substantially repaired, altered, or improved, unless (x) the Company would be
entitled pursuant to Section 11.10(a) to issue, assume, guarantee or permit to
exist Debt secured by a Lien on such Operating Property without equally and
ratably securing the Securities or (y) the Company would be entitled pursuant to
Section 11.10(b), after giving effect to such Sale and Lease-Back Transaction,
to incur $1.00 of additional Debt secured by Liens (other than Liens permitted
by Section 11.10(a)) or (z) the Company shall apply or cause to be applied, in
the case of a sale or transfer for cash, an amount equal to the net proceeds
thereof (but not in excess of the net book value of such Operating Property at
the date of such sale or transfer) and, in the case of a sale or transfer
otherwise than for cash, an amount equal to the fair value (as determined by the
Board of Directors) of the Operating Property so leased, to the retirement,
within one hundred eighty (180) days after the effective date of such Sale and
Lease-Back Transaction, of Securities (in accordance with their terms) or other
Debt of the Company ranking senior to, or equally with, the Securities;
PROVIDED, HOWEVER, that the amount to be applied to such retirement of Debt
shall be reduced by an amount equal to the principal amount, plus any premium or
fee paid in connection with any redemption in accordance with the terms of Debt
voluntarily retired by the Company within such one hundred eighty (180) day
period, excluding retirement pursuant to mandatory sinking fund or prepayment
provisions and payments at maturity.

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ARTICLE XII

REDEMPTION OF SECURITIES

SECTION 12.01. APPLICABILITY OF ARTICLE.

Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated by Section 3.01 for Securities of any
series) in accordance with this Article.

SECTION 12.02. ELECTION TO REDEEM; NOTICE TO TRUSTEE.

The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution. In case of any redemption at the election of
the Company of less than all the Securities of any series, the Company shall, at
least 45 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date and of the principal amount of Securities of such series to be
redeemed. In the case of any redemption of Securities prior to the expiration
of any restriction on such redemption provided in the terms of such Securities
or elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officer's Certificate evidencing compliance with such restriction.

SECTION 12.03. ELECTION BY TRUSTEE OF SECURITIES TO BE REDEEMED.

If less than all the Securities of any series are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 90 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, substantially pro rata, by lot
or by any other method as the Trustee considers fair and appropriate and that
complies with the requirements of the principal national securities exchange, if
any, on which such Securities are listed, and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof) of
the principal amount of Securities of such series of a denomination larger than
the minimum authorized denomination for Securities of that series; provided that
in case the Securities of such series have different terms and maturities, the
Securities to be redeemed shall be selected by the Company and the Company shall
give notice thereof to the Trustee.

The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed.

For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of the Securities shall
relate, in the case of any Securities redeemed or to be redeemed only in part,
to the portion of the principal amount of such Securities which has been or is
to be redeemed.

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SECTION 12.04. NOTICE OF REDEMPTION.

Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 45 days prior to the Redemption
Date, unless otherwise provided in an indenture supplemental hereto, to each
Holder of Securities to be redeemed, at his address appearing in the Security
Register.

All notices of redemption shall state:

(1) the Redemption Date;

(2) the Redemption Price;

(3) if less than all the Outstanding Securities of any series are to
be redeemed, the identification (and, in the case of partial redemption,
the principal amounts) of the particular Securities to be redeemed;

(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date;

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

(6) that the redemption is for a sinking fund, if such is the case;

(7) the CUSIP number, if any, of the Securities to be redeemed; and

(8) unless otherwise provided as to a particular series of
Securities, if at the time of publication or mailing of any notice of
redemption the Company shall not have deposited with the Trustee or Paying
Agent and/or irrevocably directed the Trustee or Paying Agent to apply,
from money held by it available to be used for the redemption of
Securities, an amount in cash sufficient to redeem all of the Securities
called for redemption, including accrued interest to the Redemption Date,
such notice shall state that it is subject to the receipt of the redemption
moneys by the Trustee or Paying Agent before the Redemption Date (unless
such redemption is mandatory) and such notice shall be of no effect unless
such moneys are so received before such date.

Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.

SECTION 12.05. DEPOSIT OF REDEMPTION PRICE.

Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 11.08) an amount of
money sufficient to pay the Redemption

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Price of, and (except if the Redemption Date shall be an Interest Payment Date)
accrued interest on, all the Securities which are to be redeemed on that date.

SECTION 12.06. SECURITIES PAYABLE ON REDEMPTION DATE.

Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that installments of interest whose
Stated Maturity is on or prior to the Redemption Date shall be payable to the
Holders of such Securities, or one or more Predecessor Securities, registered as
such at the close of business on the relevant Regular or Special Record Dates
according to their terms and the provisions of Section 3.07.

If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.

SECTION 12.07. SECURITIES REDEEMED IN PART.

Any Security which is to be redeemed only in part shall be surrendered
at an office or agency of the Company at a Place of Payment therefor (with, if
the Company or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or his attorney duly authorized in writing), and
the Company shall execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or Securities of
the same series and Stated Maturity, of any authorized denomination as requested
by such Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered.

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ARTICLE XIII

SINKING FUNDS

SECTION 13.01. APPLICABILITY OF ARTICLE.

The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of a series, except as otherwise specified as
contemplated by Section 3.01 for Securities of such series.

The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "MANDATORY SINKING
FUND PAYMENT," and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "OPTIONAL
SINKING FUND PAYMENT." If provided for by the terms of Securities of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 13.02. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.

SECTION 13.02. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.

The Company (1) may deliver Securities of a series (other than any
Securities previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited.
Such Securities shall be received and credited for such purpose by the Trustee
at the Redemption Price specified in such Securities for redemption through
operation of the sinking fund and the amount of such sinking fund payment shall
be reduced accordingly.

SECTION 13.03. REDEMPTION OF SECURITIES FOR SINKING FUND.

Not less than 45 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officer's
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting Securities of that series
pursuant to Section 13.02 and will also deliver to the Trustee any Securities to
be so delivered. Not less than 30 days before each such sinking fund payment
date the Trustee shall select the Securities to be redeemed upon such sinking
fund payment date in the manner specified in Section 12.03 and cause notice of
the redemption thereof to be given in the name of and at the expense of the
Company in the manner provided in Section 12.04. Such notice having been duly
given, the redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 12.06 and 12.07.

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<PAGE>

ARTICLE XIV

DEFEASANCE AND COVENANT DEFEASANCE

SECTION 14.01. APPLICABILITY OF ARTICLE; COMPANY'S OPTION TO EFFECT
DEFEASANCE OR COVENANT DEFEASANCE.

Unless pursuant to Section 3.01 provision is made for the
inapplicability of either or both of (a) Defeasance of the Securities of a
series under Section 14.02 or (b) Covenant Defeasance of the Securities of a
series under Section 14.03, then the provisions of such Section or Sections, as
the case may be, together with the other provisions of this Article, shall be
applicable to the Securities of such series, and the Company may at its option
by Board Resolution, at any time, with respect to the Securities of such series,
elect to have either Section 14.02 (unless inapplicable) or Section 14.03
(unless inapplicable) be applied to the Outstanding Securities of such series
upon compliance with the applicable conditions set forth below in this Article.

SECTION 14.02. DEFEASANCE AND DISCHARGE.

Upon the Company's exercise of the option provided in Section 14.01 to
defease the Outstanding Securities of a particular series, the Company shall be
discharged from its obligations with respect to the Outstanding Securities of
such series on the date the applicable conditions set forth in Section 14.04 are
satisfied (hereinafter, "DEFEASANCE"). Defeasance shall mean that the Company
shall be deemed to have paid and discharged the entire indebtedness represented
by the Outstanding Securities of such series and to have satisfied all its other
obligations under such Securities and this Indenture insofar as such Securities
are concerned (and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging the same); provided, however, that the
following rights, obligations, powers, trusts, duties and immunities shall
survive until otherwise terminated or discharged hereunder: (A) the rights of
Holders of Outstanding Securities of such series to receive, solely from the
trust fund provided for in Section 14.04, payments in respect of the principal
of (and premium, if any) and interest on such Securities when such payments are
due, (B) the Company's obligations with respect to such Securities under
Sections 3.04, 3.05, 3.06, 11.02 and 11.09, (C) the rights, powers, trusts,
duties and immunities of the Trustee hereunder and (D) this Article. Subject to
compliance with this Article, the Company may exercise its option with respect
to Defeasance under this Section 14.02 notwithstanding the prior exercise of its
option with respect to Covenant Defeasance under Section 14.03 in regard to the
Securities of such series.

SECTION 14.03. COVENANT DEFEASANCE.

Upon the Company's exercise of the option provided in Section 14.01 to
obtain a Covenant Defeasance with respect to the Outstanding Securities of a
particular series, the Company shall be released from its obligations under this
Indenture (except its obligations under Sections 3.04, 3.05, 3.06, 6.06, 6.09,
7.10, 11.01, 11.02, 11.06, 11.08 and 11.09) with respect to the Outstanding
Securities of such series on and after the date the applicable

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<PAGE>

conditions set forth in Section 14.04 are satisfied (hereinafter, "COVENANT
DEFEASANCE"). Covenant Defeasance shall mean that, with respect to the
Outstanding Securities of such series, the Company may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in this Indenture (except its obligations under Sections 3.04, 3.05, 3.06,
6.06, 6.09, 7.10, 11.01, 11.02, 11.06, 11.08 and 11.09), whether directly or
indirectly by reason of any reference elsewhere herein or by reason of any
reference to any other provision herein or in any other document, and such
omission to comply shall not constitute an Event of Default under Section
6.01(3) with respect to Outstanding Securities of such series, and the remainder
of this Indenture and of the Securities of such series shall be unaffected
thereby.

SECTION 14.04. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.

The following shall be the conditions to Defeasance under Section
14.02 and Covenant Defeasance under Section 14.03 with respect to the
Outstanding Securities of a particular series:

(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.09 who shall agree to comply with the provisions of this
Article applicable to it), under the terms of an irrevocable trust
agreement in form and substance reasonably satisfactory to such Trustee, as
trust funds in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the benefit
of the Holders of such Securities, (A) Dollars in an amount, or (B) U.S.
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide,
not later than the due date of any payment, money in an amount, or (C) a
combination thereof, in each case sufficient, after payment of all federal,
state and local taxes or other charges or assessments in respect thereof
payable by the Trustee, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, and which shall be applied
by the Trustee (or other qualifying trustee) to pay and discharge, (i) the
principal of (and premium, if any, on) and each installment of principal of
(and premium, if any) and interest on the Outstanding Securities of such
series on the Stated Maturity of such principal or installment of principal
or interest and (ii) any mandatory sinking fund payments or analogous
payments applicable to the Outstanding Securities of such series on the day
on which such payments are due and payable in accordance with the terms of
this Indenture and of such Securities.

(2) No Default or Event of Default with respect to the Securities of
such series shall have occurred and be continuing on the date of such
deposit or shall occur as a result of such deposit, and no Default or Event
of Default under clause (6) or (7) of Section 6.01 shall occur and be
continuing, at any time during the period ending on the 91st day after the
date of such deposit (it being understood that this condition shall not be
deemed satisfied until the expiration of such period).

-84-
<PAGE>

(3) Such deposit, Defeasance or Covenant Defeasance shall not result
in a breach or violation of, or constitute a default under, any other
agreement or instrument to which the Company is a party or by which it is
bound.

(4) Such Defeasance or Covenant Defeasance shall not cause any
Securities of such series then listed on any national securities exchange
registered under the Exchange Act to be delisted.

(5) In the case of an election with respect to Section 14.02, the
Company shall have delivered to the Trustee either (A) a ruling directed to
the Trustee received from the Internal Revenue Service to the effect that
the Holders of the Outstanding Securities of such series will not recognize
income, gain or loss for federal income tax purposes as a result of such
Defeasance and will be subject to federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such Defeasance had not occurred or (B) an Opinion of Counsel, based on
such ruling or on a change in the applicable federal income tax law since
the date of this Indenture, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the Outstanding
Securities of such series will not recognize income, gain or loss for
federal income tax purposes as a result of such Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Defeasance had not
occurred.

(6) In the case of an election with respect to Section 14.03, the
Company shall have delivered to the Trustee an Opinion of Counsel or a
ruling directed to the Trustee received from the Internal Revenue Service
to the effect that the Holders of the Outstanding Securities of such series
will not recognize income, gain or loss for federal income tax purposes as
a result of such Covenant Defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as would
have been the case if such Covenant Defeasance had not occurred.

(7) Such Defeasance or Covenant Defeasance shall be effected in
compliance with any additional terms, conditions or limitations which may
be imposed on the Company in connection therewith pursuant to Section 3.01.

(8) The Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the Defeasance under Section
14.02 or the Covenant Defeasance under Section 14.03 (as the case may be)
have been complied with.

SECTION 14.05. DEPOSITED MONEY AND GOVERNMENT OBLIGATIONS TO BE HELD
IN TRUST.

Subject to the provisions of the last paragraph of Section 11.08, all
money and Government Obligations (including the proceeds thereof) deposited with
the Trustee (or other qualifying trustee--collectively for purposes of this
Section 14.05, the "Trustee") pursuant to Section 14.04 in respect of the
Outstanding Securities of a particular series shall be held in trust and applied
by the Trustee, in accordance with the provisions of such Securities and this

-85-
<PAGE>

Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities of all sums due and to become due
thereon in respect of principal (and premium, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law.

The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the Government Obligations
deposited pursuant to Section 14.04 or the principal and interest received in
respect thereof, other than any such tax, fee or other charge which by law is
for the account of the Holders of the Outstanding Securities of such series.

Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver to pay to the Company from time to time upon company Request any
money or Government Obligations held by it as provided in Section 14.04 which,
in the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof which would then be required to be deposited for
the purpose for which such money or Government Obligations were deposited.

-86-
<PAGE>

ARTICLE XV

MISCELLANEOUS

SECTION 15.01. MISCELLANEOUS.

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

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.

WISCONSIN PUBLIC SERVICE
CORPORATION

By:
--------------------------------
Name:
Title:

Attest:

- --------------------------------
Name:
Title:

FIRSTAR BANK MILWAUKEE, N.A.
NATIONAL ASSOCIATION,
as Trustee

By:
--------------------------------
Name:
Title:

Attest:

- --------------------------------
Name:
Title:

-87-

<PAGE>

EXHIBIT 4C

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

FIRST SUPPLEMENTAL INDENTURE

FROM

WISCONSIN PUBLIC SERVICE CORPORATION

FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION

TRUSTEE
-----------------------

Dated as of December ___, 1998

SUPPLEMENTAL TO INDENTURE

Dated as of December 1, 1998

Senior Debt Securities

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

This FIRST SUPPLEMENTAL INDENTURE is made as of the ____ day of
December, by and between WISCONSIN PUBLIC SERVICE CORPORATION, a corporation
duly organized and existing under the laws of the State of Wisconsin (the
"Company"), and FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION, a
corporation duly organized and existing under the laws of the United States,
as trustee (the "Trustee").

RECITALS OF THE COMPANY:

WITNESSETH: that

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

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

The Company desires to establish a series of Securities to be
designated "Senior Secured Notes, ___% Series Due ___________, _____" (the
"Securities of the Series due _________"); and

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

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

NOW, THEREFORE, this Supplemental Indenture

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

1
<PAGE>

ARTICLE I
RELATION TO INDENTURE; DEFINITIONS

SECTION 1.1.

This Supplemental Indenture constitutes an integral part of the
Indenture.

SECTION 1.2.

For all purposes of this Supplemental Indenture:

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

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

ARTICLE II

THE SECURITIES

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

(a) The title of the Securities of the series hereby established is
"Senior Secured Notes, ____% Series Due ________."

(b) The aggregate principal amount of the Securities of the Series
due _____ which may be authenticated and delivered under the Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of other Securities of such
series pursuant to Sections 2.05, 3.04, 3.05, 3.06, 10.06 or 12.07) shall be
limited to Fifty Million Dollars ($50,000,000).

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

(d) The Stated Maturity of the Securities of the Series due _____
is _________.

(e) The Securities of the Series due _____ shall bear interest at
the rate of ____% per annum and such interest shall accrue from ___________
(or from the most recent Interest Payment Date to which interest on the
Securities of the Series due _____ has been paid or provided for). The
Interest Payment Dates for the Securities of the Series due _____ shall

2
<PAGE>

be ________ and ________ in each year commencing _________, 1999, and the
Regular Record Date for the interest payable on any Interest Payment Date
shall be the fifteenth day (whether or not a Business Day) preceding such
Interest Payment Date.

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

(g) The Securities of the Series due _____ are not redeemable at
the option of the Company prior to _________.
[The Securities of the Series due _____ are redeemable at the option of
the Company without premium or penalty in whole or in part at any time on or
after _________.]

(h) The Securities of the Series due _____ shall not be subject to
any sinking fund [and shall not be redeemable at the option of the Holders
thereof.]

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

(j) The Related Series of Collateral Bonds being delivered to the
Trustee in connection with the issuance of the Securities of the Series due
_____ is the Company's First Mortgage Bonds, Collateral Series A.

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

ARTICLE III

TRANSFER OF COLLATERAL BONDS

The Company hereby issues, delivers and transfers to the Trustee in
connection with the issuance of the Securities of the Series due ___________
Fifty Million Dollars ($50,000,000) aggregate principal amount of a related
issue of Collateral Bonds of the Company designated "First Mortgage Bonds,
Collateral Series A" (each, a "Related Issue," as to the series of Securities
it secures, and, the "Collateral Bonds"), which has been fully registered in
the name of the Trustee in such capacity, to be held in trust for the benefit
of the Holders from time to time of the Related Issue of Securities and, if
such transfer does not constitute a sale of the Collateral Bonds to the
Trustee, the Company hereby grants a perfected security interest in the
Collateral Bonds for the benefit of such Holders, in each case as security
for any and all obligations of the Company under the Indenture, this
Supplemental Indenture and the Related Issue of Securities, including but not
limited to (1) the full and prompt payment of the interest on, principal of,
and premium, if any, on such Related Issue of Securities when and as the same
shall become due and payable in accordance with the terms and provisions of
the Indenture and this Supplemental Indenture and such Related Issue of
Securities, either at the Stated Maturity thereof, upon acceleration of the
maturity thereof or

3
<PAGE>

upon redemption, and (2) the full and prompt payment of any interest on such
Related Issue of Securities when and as the same shall become due and payable
in accordance with the terms and provisions of the Indenture and this
Supplemental Indenture and such Related Issue of Securities. The Trustee
shall enforce all of its rights under the First Mortgage Indenture as a
holder of each Related Issue of Collateral Bonds transferred to it as
provided in this Article III for the benefit of the Holders of the respective
Related Issue of Securities and the proceeds of the enforcement of such
rights shall be applied by the Trustee to satisfy the Company's obligations
under the Indenture, this Supplemental Indenture, and such Related Issue of
Securities.

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

The Collateral Bonds shall not be sold or transferred by the Trustee
until the earlier of the Release Date or the prior retirement of the Related
Issue of Securities through redemption, repurchase or otherwise. The
"Release Date" shall be the date that all First Mortgage Bonds of the Company
issued and outstanding under the First Mortgage Indenture, other than the
Collateral Bonds, have been retired (at, before or after the maturity
thereof) through payment, redemption or otherwise, provided that no Default
or Event of Default has occurred and, at such time, is continuing under the
Indenture.

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

ARTICLE IV

MISCELLANEOUS

SECTION 4.1.

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

SECTION 4.2.

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

4
<PAGE>

SECTION 4.3.

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

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

SECTION 4.4.

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

SECTION 4.5.

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

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

5
<PAGE>

IN WITNESS WHEREOF, WISCONSIN PUBLIC SERVICE CORPORATION has caused
this Supplemental Indenture to be executed by its Chairman, Chief Executive
Officer, President, Vice Chairman or a Vice President, or any other officer
selected by the Board of Directors, and its corporate seal to be hereunto
affixed, duly attested by its Secretary or an Assistant Secretary, and
FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION, as Trustee as aforesaid,
has caused this Supplemental Indenture to be executed by one of its
authorized signatories, as of December ___, 1998.

WISCONSIN PUBLIC SERVICE
CORPORATION

By: ____________________________________
Name:
Title:

ATTEST:

_________________________
Secretary

FIRSTAR BANK MILWAUKEE, N.A.,
NATIONAL ASSOCIATION

By: ___________________________________
Name:
Title:

ATTEST:

__________________________
Name:
Title:

6
<PAGE>
APPENDIX I

CUSIP:
No. R-1
$50,000,000

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

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

7
<PAGE>

WISCONSIN PUBLIC SERVICE CORPORATION

Senior Secured Note, ___% Series Due ___________
No. _________ [$] _________

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

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

Prior to the Release Date (as hereinafter defined), the Securities
will be secured by First Mortgage Bonds, Collateral Series A (the "Collateral
Bonds"), issued and delivered by the Company to the Trustee for the benefit
of the Holders of the Securities (as defined herein), issued under the First
Mortgage and Deed of Trust dated January 1, 1941, from the Company to First
Wisconsin Trust Company (subsequently succeeded by Firstar Bank Milwaukee,
N.A., National Association), Milwaukee, Wisconsin, as supplemented and
amended by the supplemental indentures thereto (the "First Mortgage
Indenture"). Reference is made to the First Mortgage Indenture and the
Indenture for a description of the rights of the Trustee as holder of the
Collateral Bonds, the property mortgaged and pledged under the First

8
<PAGE>

Mortgage Indenture, the rights of the Company and of the Mortgage Trustee in
respect thereof, the duties and immunities of the applicable Mortgage
Trustee, the terms and conditions upon which the Collateral Bonds are held by
the Trustee for the benefit of the Holders of Securities, and the
circumstances under which additional First Mortgage Bonds may be issued.

FROM AND AFTER SUCH TIME AS ALL FIRST MORTGAGE BONDS (OTHER THAN
COLLATERAL BONDS) ISSUED UNDER THE FIRST MORTGAGE INDENTURE HAVE BEEN RETIRED
THROUGH PAYMENT, REDEMPTION OR OTHERWISE (INCLUDING THOSE FIRST MORTGAGE
BONDS THE PAYMENT FOR WHICH HAS BEEN PROVIDED FOR IN ACCORDANCE WITH THE
FIRST MORTGAGE INDENTURE) AT, BEFORE OR AFTER THE MATURITY THEREOF AND
PROVIDED THAT NO DEFAULT OR EVENT OF DEFAULT UNDER THE INDENTURE HAS OCCURRED
AND IS CONTINUING (THE "RELEASE DATE"), THE COLLATERAL BONDS SHALL CEASE TO
SECURE THE SECURITIES IN ANY MANNER, AND, AT THE OPTION OF THE COMPANY, THE
SECURITIES EITHER (a) WILL BECOME UNSECURED GENERAL OBLIGATIONS OF THE
COMPANY OR (b) WILL BE SECURED BY FIRST MORTGAGE BONDS ISSUED UNDER AN
INDENTURE OTHER THAN THE FIRST MORTGAGE INDENTURE. IN CERTAIN CIRCUMSTANCES
PRIOR TO THE RELEASE DATE AS PROVIDED IN THE INDENTURE, THE COMPANY IS
PERMITTED TO REDUCE THE AGGREGATE PRINCIPAL AMOUNT OF AN ISSUE OF COLLATERAL
BONDS HELD BY THE TRUSTEE, BUT IN NO EVENT PRIOR TO THE RELEASE DATE TO AN
AMOUNT LESS THAN THE AGGREGATE PRINCIPAL AMOUNT OUTSTANDING OF THE RELATED
ISSUE OF SECURITIES INITIALLY ISSUED CONTEMPORANEOUSLY WITH SUCH COLLATERAL
BONDS.

Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this
Security shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purpose.

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

WISCONSIN PUBLIC SERVICE
CORPORATION

By______________________________________

Attest: [SEAL]
_______________________

9
<PAGE>

FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.

Dated: _______________

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

_____________________________________
As Trustee

By___________________________________
Authorized Signatory

FORM OF REVERSE OF SECURITY.

This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of December 1, 1998 (herein called
the "Indenture"), between the Company and Firstar Bank Milwaukee, N.A.,
National Association, as Trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture), to which Indenture and
all indentures supplemental thereto reference is hereby made for a statement
of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and
of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof,
limited in aggregate principal amount to $50,000,000.

The Securities of this series are [not] subject to redemption
[upon not less than 30 nor more than 45 days' notice by first class mail, in
whole or in part at any time on or after __________, _____, at the election
of the Company at a Redemption Price equal to 100% of the principal amount of
the Securities to be redeemed together with accrued and unpaid interest to the
Redemption Date.]

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

10
<PAGE>

enforceable), all of the Company's obligations in respect of the payment of
the principal of and interest, if any, on the Securities of this series shall
terminate.

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

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

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

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

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

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

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

11
<PAGE>

whose name this Security is registered as the owner hereof for all purposes,
whether or not this Security be overdue, and neither the Company, the Trustee
nor any such agent shall be affected by notice to the contrary.

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

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

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

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

12
<PAGE>

ASSIGNMENT FORM

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

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

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

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

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

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

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

Social Security Number or Taxpayer Identification
Number:_______________________________________

13
<PAGE>
APPENDIX II

No. R-1
Principal Amount

$50,000,000

(FORM OF BOND OF COLLATERAL SERIES A)

WISCONSIN PUBLIC SERVICE CORPORATION

(Incorporated under the laws of the State of Wisconsin)
First Mortgage Bond, Collateral Series A
No._____________ $___________

THE FIRST MORTGAGE BONDS, COLLATERAL SERIES A (HEREINAFTER, "COLLATERAL BONDS"),
REPRESENTED BY THIS CERTIFICATE ARE BEING ISSUED AND DELIVERED BY THE COMPANY TO
FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION AS TRUSTEE (IN SUCH CAPACITY,
THE "SENIOR TRUSTEE") UNDER AN INDENTURE, DATED AS OF DECEMBER 1, 1998, BETWEEN
THE COMPANY AND THE SENIOR TRUSTEE, AS SUPPLEMENTED BY THE FIRST SUPPLEMENTAL
INDENTURE THERETO DATED AS OF DECEMBER __, 1998 (AS SO SUPPLEMENTED, THE "SENIOR
INDENTURE"). THE COLLATERAL BONDS ARE TO BE HELD IN TRUST AS COLLATERAL FOR THE
BENEFIT OF THE HOLDERS OF $50,000,000 AGGREGATE PRINCIPAL AMOUNT OF SENIOR
SECURED NOTES ____% SERIES DUE DECEMBER 1, _____ (THE "RELATED SECURITIES")
ISSUED PURSUANT TO THE SENIOR INDENTURE.

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

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

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

14
<PAGE>

ASSOCIATION, as trustee for the benefit of the holders of Related Securities,
or registered assigns (in such capacity, the "Senior Trustee"), on the ______
day of _________, ____, the sum of _____________________ DOLLARS
($___________) in lawful money of the United States of America, and to pay
interest thereon from the date hereof at the rate of _____________ per cent
(_____%) per annum, in like money, until the principal hereof becomes due and
payable, said interest being payable on the _____ day of ___________ and on
the _____ day of __________ in each year commencing __________, 1999. The
principal and interest so payable on any ________ 1 or _________ 1 will be
paid to the person or entity in whose name this bond is registered, at the
address thereof as it appears on the Company's books for registration and
registration of transfer.

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

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

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

Dated as of:

WISCONSIN PUBLIC SERVICE CORPORATION,

By:______________________________________
______ President
Attest:

_____________________________
____________ Secretary

15
<PAGE>

(FORM OF TRUSTEE'S CERTIFICATE)

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

FIRSTAR BANK MILWAUKEE, N.A.,
NATIONAL ASSOCIATION,
As Trustee

By:_____________________________________
Authorized Signature

(TEXT APPEARING ON REVERSE SIDE OF BOND OR ATTACHED PAGES)

This bond is one of a duly authorized issue of bonds of the Company,
known as its First Mortgage Bonds, of the Series and designation indicated on
the face hereof, which issue of bonds consists, or may consist, of several
series of varying denominations, dates and tenors, all issued and to be
issued under and equally secured (except in so far as a sinking fund, or
similar fund, established in accordance with the provisions of the Indenture,
may afford additional security for the bonds of any specific series) by a
First Mortgage and Deed of Trust (herein called the "Indenture") dated as of
January 1, 1941, executed by the Company to First Wisconsin Trust Company
(subsequently succeeded by Firstar Bank Milwaukee, N.A., National
Association, herein called the Trustee), as Trustee, to which Indenture and
all instruments supplemental thereto reference is hereby made for a
description of the property mortgaged and pledged, the nature and extent of
the security, the rights of the holders of the bonds as to such security, and
the terms and conditions upon which the bonds may be issued under the
Indenture and any instruments supplemental thereto and are secured. The
principal hereof may be declared or may become due on the conditions, in the
manner and at the time set forth in the Indenture, upon the happening of a
completed default as in the Indenture provided. This bond is one of a series
created by a Supplemental Indenture (herein called the "Supplemental
Indenture") dated as of December 1, 1998, between the Company and the
Trustee, which is supplemental to the Indenture.

The Senior Trustee has agreed pursuant to the Senior Indenture to
hold the Bonds of this Series as collateral for the benefit of the holders of
the Related Securities under all circumstances and not to transfer (except to
a successor trustee) such Bonds until the earlier of the Release Date or the
prior retirement of the Related Securities through redemption, repurchase or
otherwise. "Release Date" means the date on which all First Mortgage Bonds
of the Company issued and outstanding under the Indenture, other than the
Bonds of this Series and other Bonds pledged as security for Securities
issued under the Senior Indenture (collectively "Collateral Bonds"), have
been retired (at, before or after the maturity thereof) through payment,
redemption or otherwise provided that no default or event of default has

16
<PAGE>

occurred and is continuing under the Senior Indenture. On the Release Date,
the Senior Trustee shall deliver to the Company for cancellation all
Collateral Bonds, and the Company shall cause the Senior Trustee to provide
notice to all holders of Related Securities of the occurrence of the Release
Date. As a result, on the Release Date, the Bonds of this Series shall cease
to secure the Related Securities. Following the Release Date, the Company
shall cause the Indenture to be discharged, and the Company shall not issue
any additional Collateral Bonds thereunder and from and after the Release
Date, the Company's obligations in respect of the Collateral Bonds shall be
satisfied and discharged.

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

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

The bonds of this Series are [not] subject to redemption, prior to
maturity, at the option of the Company
[from time to time, in whole or in part on any date on or after __________,
_____, upon payment of 100% of the principal amount thereof, together with
accrued interest thereon to the redemption date, all subject to the conditions
and as more fully set forth in the Indenture and the Supplemental Indenture.]

Notice of any such redemption shall be hand delivered or mailed not
less than forty-five (45) days prior to the redemption date to the registered
owner of the bonds so to be redeemed, at its address as the same shall appear
on the Company's books for registration and registration of transfer, all
subject to the conditions and as more fully set forth in the Indenture and in
the Supplemental Indenture, except that no newspaper publication shall be
required.

In the event that an event of default under Section 6.01 of the
Senior Indenture has occurred and is continuing, and the Senior Trustee has
declared the principal of all of the Related Securities then outstanding
immediately due and payable (or such principal has become ipso facto
immediately due and payable) under Section 6.02 of the Senior Indenture, then
the Company shall call for redemption and redeem all of the bonds of this
series then outstanding at a price equal to 100% of the principal amount
thereof, together with accrued interest thereon to the redemption date. The
redemption date shall be the

17
<PAGE>

accelerated maturity date of the Related Securities, and no prior notice of
such redemption to the Trustee or the Senior Trustee shall be required.

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

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

(END OF TEXT OF BOND)

<PAGE>

EXHIBIT 4D

THIRTY-THIRD

SUPPLEMENTAL INDENTURE

FROM

WISCONSIN PUBLIC SERVICE
CORPORATION

FIRSTAR BANK MILWAUKEE, N.A. NATIONAL ASSOCIATION
(SUCCESSOR TO FIRSTAR TRUST COMPANY,
FORMERLY KNOWN AS FIRST WISCONSIN TRUST COMPANY)
TRUSTEE

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

DATED AS OF DECEMBER 1, 1998

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

SUPPLEMENTAL
TO
FIRST MORTGAGE AND DEED OF TRUST
DATED AS OF JANUARY 1, 1941

<PAGE>

WISCONSIN PUBLIC SERVICE CORPORATION
THIRTY-THIRD SUPPLEMENTAL INDENTURE

Dated as of December 1, 1998

TABLE OF CONTENTS
------------

PAGE

Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recitals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Form of Bond of Collateral Series A . . . . . . . . . . . . . . . . . . .
Form of Trustee's Certificate . . . . . . . . . . . . . . . . . . . . . .
Form of Prepayment Record . . . . . . . . . . . . . . . . . . . . . . . .
Further Recitals. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ARTICLE I
FORM OF EXECUTION OF BONDS OF NEW SERIES

Sec. 1.01 Terms of bonds of new series. . . . . . . . . . . . . . . .
Sec. 1.02 Limitation of new series to $50,000,000 . . . . . . . . . .
Sec. 1.03 Optional redemption of bonds of new series by Company . . .
[Sec. 1.04 Notice of, and selection of bonds of new series for,
redemption] . . . . . . . . . . . . . . . . . . . . . . . .
Sec. 1.05 Redemption in event of default under section 6.01
of the Senior Indenture . . . . . . . . . . . . . . . . . .
[Sec. 1.06 Partial redemption and payments of redemption price
without presentation of bonds and new series] . . . . . . .
Sec. 1.07 Company not obligated to make any transfer of bonds
of new series for fifteen days before any interest
payment date. . . . . . . . . . . . . . . . . . . . . . . .
Sec. 1.08 Charges for transfer of bonds of new series . . . . . . . .
Sec. 1.09 Bonds of new series may be signed by facsimile
signatures of Company officers. . . . . . . . . . . . . . .
Sec. 1.10 Payment dates falling on Saturday, Sunday or
legal holiday . . . . . . . . . . . . . . . . . . . . . . .
Sec. 1.11 Bonds of new series redeemed or paid not reissuable,
but may be basis for issuance of bonds of different
series, credits or cash withdrawals . . . . . . . . . . . .

ARTICLE II
CONFIRMATION OF LIEN

Sec. 2.01 Granting clauses and habendum . . . . . . . . . . . . . . .

i
<PAGE>

ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY

Sec. 3.01 Duly authorized by law to execute and deliver
Supplemental Indenture and issue bonds. . . . . . . . . . .
Sec. 3.02 Covenant of lawful possession, right to mortgage
property and to maintain lien of Indenture. . . . . . . . .
Sec. 3.03 Payment of principal and interest . . . . . . . . . . . . .
Sec. 3.04 Nonliability of Trustee . . . . . . . . . . . . . . . . . .

ARTICLE IV
MISCELLANEOUS

Sec. 4.01 Recitals not made by Trustee. No representations
made by Trustee. Trust accepted subject to terms and
conditions of Indenture . . . . . . . . . . . . . . . . . .
Sec. 4.02 Supplemental Indenture to be construed as part of
Indenture . . . . . . . . . . . . . . . . . . . . . . . . .
Sec. 4.03(a) References to either party to Supplemental
Indenture includes successors or assigns. . . . . . . . . .
(b) Table of contents and descriptive headings of articles
not to affect meaning . . . . . . . . . . . . . . . . . . .
Sec. 4.04(a) Trust Indenture Act requirements control. . . . . . . . . .
(b) Severability of Supplemental Indenture provisions
and bond provisions. . . . . . . . . . . . . . . . . . . .
Sec. 4.05 Provisions for execution in counterparts. . . . . . . . . .
Sec. 4.06 Supplemental Indenture effective on execution and
delivery. . . . . . . . . . . . . . . . . . . . . . . . . .
Sec. 4.07 Names and addresses of debtor and secured party . . . . . .

ii
<PAGE>

THIRTY-THIRD SUPPLEMENTAL INDENTURE, made as of the 1st day of
December, 1998, by and between WISCONSIN PUBLIC SERVICE CORPORATION, a
corporation duly organized and existing under and by virtue of the laws of the
State of Wisconsin, having its principal office in the City of Green Bay in said
State (hereinafter sometimes called the "Company"), party of the first part, and
FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION (successor to Firstar Trust
Company, formerly known as First Wisconsin Trust Company), a national banking
association duly organized and existing under and by virtue of the laws of the
United States, having its principal office in the City of Milwaukee in the State
of Wisconsin, as Trustee (hereinafter sometimes called the "Trustee"), party of
the second part.

WHEREAS, the Company has heretofore executed and delivered to the
predecessor of the Trustee its First Mortgage and Deed of Trust made as of
January 1, 1941 (hereinafter referred to as the "1941 Mortgage") and has
heretofore executed and delivered to the predecessor of the Trustee supplemental
indentures dated and hereinafter referred to as follows:

SUPPLEMENTAL INDENTURE
DATED (AS OF) HEREINAFTER REFERRED TO AS
---------------------- --------------------------

November 1, 1947 . . . . . . . . . First Supplemental Indenture*
August 1, 1948 . . . . . . . . . . Second Supplemental Indenture
September 1, 1949 . . . . . . . . . Third Supplemental Indenture
November 1, 1950 . . . . . . . . . Fourth Supplemental Indenture*
May 1, 1953 . . . . . . . . . . . . Fifth Supplemental Indenture*
January 1, 1954 . . . . . . . . . . Sixth Supplemental Indenture
October 1, 1954 . . . . . . . . . . Seventh Supplemental Indenture
December 1, 1957 . . . . . . . . . Eighth Supplemental Indenture
November 1, 1959 . . . . . . . . . Ninth Supplemental Indenture
October 1, 1963 . . . . . . . . . . Tenth Supplemental Indenture
June 1, 1964 . . . . . . . . . . . Eleventh Supplemental Indenture
November 1, 1967 . . . . . . . . . Twelfth Supplemental Indenture
April 1, 1969 . . . . . . . . . . . Thirteenth Supplemental Indenture
August 1, 1970 . . . . . . . . . . Fourteenth Supplemental Indenture
May 1, 1971 . . . . . . . . . . . . Fifteenth Supplemental Indenture
August 1, 1973 . . . . . . . . . . Sixteenth Supplemental Indenture*
September 1, 1973 . . . . . . . . . Seventeenth Supplemental Indenture
October 1, 1975 . . . . . . . . . . Eighteenth Supplemental Indenture
February 1, 1977 . . . . . . . . . Eighteenth Supplemental Indenture
July 15, 1980 . . . . . . . . . . . Twentieth Supplemental Indenture
December 1, 1980 . . . . . . . . . Twenty-First Supplemental Indenture*
April 1, 1981 . . . . . . . . . . . Twenty-Second Supplemental Indenture
February 1, 1984 . . . . . . . . . Twenty-Third Supplemental Indenture
March 15, 1984 . . . . . . . . . . Twenty-Fourth Supplemental Indenture
October 1, 1985 . . . . . . . . . . Twenty-Fifth Supplemental Indenture
December 1, 1987 . . . . . . . . . Twenty-Sixth Supplemental Indenture*

<PAGE>

SUPPLEMENTAL INDENTURE
DATED (AS OF) HEREINAFTER REFERRED TO AS
---------------------- --------------------------

September 1, 1991 . . . . . . . . . Twenty-Seventh Supplemental Indenture
July 1, 1992 . . . . . . . . . . . Twenty-Eighth Supplemental Indenture
October 1, 1992 . . . . . . . . . . Twenty-Ninth Supplemental Indenture
February 1, 1993 . . . . . . . . . Thirtieth Supplemental Indenture
July 1, 1993 . . . . . . . . . . . Thirty-First Supplemental Indenture
November 1, 1993. . . . . . . . . . Thirty-Second Supplemental Indenture

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

*Includes amendments to or modifications of certain provisions of the 1941
Mortgage.

(said 1941 Mortgage, as supplemented, amended or modified by the aforesaid
Supplemental Indentures, being hereinafter referred to as the "Indenture",
except as such term is differently defined and used in and for the purposes of
the Form of Bond of Collateral Series A and the Form of Trustee's Certificate
hereinafter set forth), whereby the Company granted, bargained, sold, warranted,
released, conveyed, assigned, transferred, mortgaged, pledged, set over and
confirmed unto the Trustee, and to its respective successors in trust, upon the
terms, conditions and trusts therein set forth, all the property as therein
described, real, personal and mixed, then owned or thereafter acquired by the
Company, with certain exceptions as in the granting clauses and definitions of
the Indenture set forth, to be held by the Trustee in trust, under the terms and
subject to the conditions of the Indenture, as security for the bonds of the
Company issued and to be issued thereunder in accordance with the provisions of
the Indenture; and

WHEREAS, Section 2.01 of the 1941 Mortgage provides that bonds may be
issued thereunder in one or more series, each series to have such distinctive
designation as the Board of Directors of the Company may select for such series;
and

WHEREAS, the Company has heretofore issued and there are now
outstanding, in accordance with the provisions of the 1941 Mortgage and said
Supplemental Indentures bonds of several series designated "First Mortgage
Bonds, 8.80% Series due September 1, 2021", "First Mortgage Bonds, 6 1/8%
Series due October 1, 2005", "First Mortgage Bonds, 7.30% Series due October
1, 2002", "First Mortgage Bonds, 6.80% Series due February 1, 2003", "First
Mortgage Bonds, 7 1/8% Series Due July 1, 2023" and First Mortgage Bonds Due
February 1, 2013; and

WHEREAS, the Company has agreed to issue $50,000,000 in aggregate
principal amount of Senior Secured Notes ____% Series Due __________, ____ (the
"Related Securities") pursuant to an Indenture, dated as of December 1, 1998,
between the Company and Firstar Bank Milwaukee, N.A., as trustee (the "Senior
Trustee"); and

WHEREAS, in order to secure the Company's obligations to pay
principal, premium, if any, and interest on the Related Securities, the Company
is desirous of providing for the issuance under the Indenture of bonds of a new
series designated as "First Mortgage

2
<PAGE>

Bonds, Collateral Series A", in an aggregate principal amount of not more than
$50,000,000, the bonds of said series to be issued as registered bonds without
coupons in any denominations that the Company may from time to time execute and
deliver, the bonds of said series, the Trustee's Certificate, and the Form of
Prepayment Record to be substantially in the tenor following:

(Form of Bond of Collateral Series A)

WISCONSIN PUBLIC SERVICE CORPORATION

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

No. $
------------- -----------

THE FIRST MORTGAGE BONDS, COLLATERAL SERIES A (HEREINAFTER, "COLLATERAL
BONDS"), REPRESENTED BY THIS CERTIFICATE ARE BEING ISSUED AND DELIVERED BY
THE COMPANY TO FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION, AS TRUSTEE
(IN SUCH CAPACITY, THE "SENIOR TRUSTEE") UNDER AN INDENTURE, DATED AS OF
DECEMBER 1, 1998, BETWEEN THE COMPANY AND THE SENIOR TRUSTEE, AS SUPPLEMENTED
BY THE FIRST SUPPLEMENTAL INDENTURE THERETO DATED AS OF DECEMBER __, 1998 (AS
SO SUPPLEMENTED, THE "SENIOR INDENTURE"). THE COLLATERAL BONDS ARE TO BE
HELD IN TRUST AS COLLATERAL FOR THE BENEFIT OF THE HOLDERS OF $50,000,000
AGGREGATE PRINCIPAL AMOUNT OF SENIOR SECURED NOTES ____% SERIES DUE
___________________, _____ (THE "RELATED SECURITIES") ISSUED PURSUANT TO THE
SENIOR INDENTURE.

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

WISCONSIN PUBLIC SERVICE CORPORATION, a corporation organized and
existing under the laws of the State of Wisconsin (hereinafter called the
Company), for value received, hereby promises to pay to FIRSTAR BANK MILWAUKEE,
N.A. NATIONAL ASSOCIATION, as trustee for the benefit of the holders of Related
Securities, or registered assigns (in such capacity, the "Senior Trustee"), on
the ______ day of _________, ____, the

3
<PAGE>

sum of _____________________ DOLLARS ($___________) in lawful money of the
United States of America, and to pay interest thereon from the date hereof at
the rate of _____________ per cent (_____%) per annum, in like money, until the
principal hereof becomes due and payable, said interest being payable on the
_____ day of ___________ and on the _____ day of __________ in each year
commencing __________, 1999. The principal and interest so payable on any
________ 1 or _________ 1 will be paid to the person or entity in whose name
this bond is registered, at the address thereof as it appears on the Company's
books for registration and registration of transfer.

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

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

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

Dated as of:

WISCONSIN PUBLIC SERVICE CORPORATION,

By:
-----------------------------------
______ President
Attest:

- -----------------------------
Secretary
- ----------

<PAGE>

(Form of Trustee's Certificate)

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

FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION
As Trustee

By:
-------------------------------
Authorized Signature

(TEXT APPEARING ON REVERSE SIDE OF BOND OR ATTACHED PAGES)

This bond is one of a duly authorized issue of bonds of the Company,
known as its First Mortgage Bonds, of the series and designation indicated on
the face hereof, which issue of bonds consists, or may consist, of several
series of varying denominations, dates and tenors, all issued and to be issued
under and equally secured (except in so far as a sinking fund, or similar fund,
established in accordance with the provisions of the Indenture, may afford
additional security for the bonds of any specific series) by a First Mortgage
and Deed of Trust (herein called the "Indenture") dated as of January 1, 1941,
executed by the Company to First Wisconsin Trust Company (subsequently succeeded
by Firstar Bank Milwaukee, National Association, herein called the Trustee), as
Trustee, to which Indenture and all instruments supplemental thereto reference
is hereby made for a description of the property mortgaged and pledged, the
nature and extent of the security, the rights of the holders of the bonds as to
such security, and the terms and conditions upon which the bonds may be issued
under the Indenture and any instruments supplemental thereto and are secured.
The principal hereof may be declared or may become due on the conditions, in the
manner and at the time set forth in the Indenture, upon the happening of a
completed default as in the Indenture provided. This bond is one of a series
created by a Supplemental Indenture (herein called the "Supplemental Indenture")
dated as of ________ __, 199_, between the Company and the Trustee, which is
supplemental to the Indenture.

The Senior Trustee has agreed pursuant to the Senior Indenture to hold
the Bonds of this Series as collateral for the benefit of the holders of the
Related Securities under all circumstances and not to transfer (except to a
successor trustee) such Bonds until the earlier of the Release Date or the prior
retirement of the Related Securities through redemption, repurchase or
otherwise. "Release Date" means the date on which all First Mortgage Bonds of
the Company issued and outstanding under the Indenture, other than the Bonds of
this Series and other Bonds pledged as security for Securities issued under the
Senior Indenture (collectively "Collateral Bonds"), have been retired (at,
before or after the maturity thereof) through payment, redemption or otherwise,
provided that no default or event of default has occurred and is continuing
under the Senior Indenture. On the Release Date, the Senior

<PAGE>

Trustee shall deliver to the Company for cancellation all Collateral Bonds, and
the Company shall cause the Senior Trustee to provide notice to all holders of
Related Securities of the occurrence of the Release Date. As a result, on the
Release Date, the Bonds of this Series shall cease to secure the Related
Securities. Following the Release Date, the Company shall cause the Indenture
to be discharged, and the Company shall not issue any additional Collateral
Bonds thereunder, and from and after the Release Date, the Company's obligations
in respect of the Collateral Bonds shall be satisfied and discharged.

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

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

The bonds of this Series are [not] subject to redemption, prior to
maturity, at the option of the Company [from time to time, in whole or in part
on any date on or after ____________, _____, if and to the extent the Related
Securities are redeemed, upon payment of ___% of the principal amount thereof,
together with accrued interest thereon to the redemption date, all subject to
the conditions and as more fully set forth in the Indenture and the Supplemental
Indenture.]

Notice of any such redemption shall be hand delivered or mailed not
less than forty-five (45) days prior to the redemption date to the registered
owner of the bonds so to be redeemed, at its address as the same shall appear on
the Company's books for registration and registration of transfer, all subject
to the conditions and as more fully set forth in the Indenture and in the
Supplemental Indenture, except that no newspaper publication shall be required.

In the event that an event of default under Section 6.01 of the Senior
Indenture has occurred and is continuing, and the Senior Trustee has declared
the principal of all of the Related Securities then outstanding immediately due
and payable (or such principal has become ipso facto immediately due and
payable) under Section 6.02 of the Senior Indenture, then the Company shall
call for redemption and redeem all of the bonds of this series then outstanding
at a price equal to 100% of the principal amount thereof, together with accrued
interest thereon to the redemption date. The redemption date shall be the

6
<PAGE>

accelerated maturity date of the Related Securities, and no prior notice of such
redemption to the Trustee or the Senior Trustee shall be required.

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

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

(END OF TEXT OF BOND)

(Form of Prepayment Record)

PREPAYMENT RECORD

PRINCIPAL AMOUNT OF BOND $__________

DATE OF MATURITY: __________, ____

PREPAYMENTS ON PRINCIPAL
------------------------
SIGNATURE OF
BALANCE AUTHORIZED
AMOUNT DATE OUTSTANDING OFFICER AND TITLE
------ ---- ----------- -----------------

and

WHEREAS, the 1941 Mortgage provides that the Company and the Trustee
may enter into indentures supplemental thereto for the purposes, among others,
of providing the terms and conditions of the issue of the bonds of any new
series; and

7
<PAGE>

WHEREAS, the Company is presently engaged within the States of
Wisconsin and Michigan in transmitting, conveying, distributing, supplying and
serving electricity and gas and intends that this Supplemental Indenture shall
be received for record and for filing in the appropriate public offices of said
States or of any other jurisdiction in which there may be located from time to
time properties intended to be subject to the lien of the Indenture in the
manner and with the effect provided by their respective laws in respect to
mortgages by, and security interests in existing and hereafter acquired
properties of, a corporation so engaged; and

WHEREAS, the execution and delivery of this Supplemental Indenture and
the issue of bonds as in this Supplemental Indenture and the Indenture provided
have been duly authorized by a resolution adopted by the Board of Directors of
the Company; and

WHEREAS, all things necessary to make the bonds of Collateral
Series A, when duly issued and executed by the Company, and authenticated and
delivered by the Trustee, valid, binding and legal obligations of the Company,
and to make the Indenture and this Supplemental Indenture valid, binding and
legal instruments for the security thereof, have been done and performed and the
issue of said bonds, as in this Supplemental Indenture and the Indenture
provided, has been in all respects duly authorized;

NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH: Wisconsin Public
Service Corporation, in consideration of the premises and of one dollar to it
duly paid by the Trustee at or before the ensealing and delivery of these
presents, the receipt whereof is hereby acknowledged, does hereby covenant and
agree to and with Firstar Bank Milwaukee, National Association, as Trustee, as
follows:

ARTICLE I.

Form And Execution Of Bonds Of New Series

SECTION 1.01. There is hereby created, for issuance under the
Indenture on the date of authentication and delivery of the Related Securities,
a series of bonds designated as Collateral Series A (herein sometimes referred
to as the bonds of Collateral Series A), each of which shall bear the
descriptive title "First Mortgage Bond, Collateral Series A". The bonds of said
series shall be issued only in the form of registered bonds without coupons and
shall be substantially of the tenor and purport, and in the form, hereinbefore
recited. The bonds of said series shall mature on __________, ____, and shall
be issued in any denominations that the Company may execute and deliver. The
bonds of said series shall bear interest at the rate of _____________ percent
(_____%) per annum, payable semiannually on __________ and ________ of each year
commencing __________, 1999. Bonds of said series issued prior to
__________, 1999 shall be dated as of __________, 1998 and bonds of said series
issued on and after __________, 1999 shall be dated as provided in Section 2.09
of the 1941 Mortgage. Principal and interest will be payable to the registered
owner of the bonds of said series, and at the address thereof, appearing on the
Company's books for registration and registration of transfer. Said bonds will
be nontransferable except to the Senior Trustee and successors thereto, if any.

8
<PAGE>

SECTION 1.02. The aggregate principal amount of all bonds of
Collateral Series A which may at any time be certified, issued and outstanding
shall be limited to $[50],000,000, and bonds of said series may be executed,
authenticated, delivered and issued hereunder from time to time subject to the
restrictions and provisions contained in this Supplemental Indenture and in the
1941 Mortgage.

SECTION 1.03. The bonds of Collateral Series A are [not] subject to
redemption prior to maturity at the option of the Company[, from time to time,
in whole or in part on any date on or after __________, ____, if and to the
extent the Related Securities are redeemed, upon payment of an amount equal to
100% of the principal amount thereof, together with accrued interest to the
redemption date.]

SECTION 1.04. [In the event that the Company shall desire to
exercise its right to redeem and pay all or any part of the bonds of Collateral
Series A pursuant to Section 1.03, it shall, except as modified herein, comply
with the terms and conditions of Article XI of the Indenture with regard to the
redemption of bonds of any series secured thereby, and such redemption shall be
made under and subject to the terms and provisions of said Article XI and in the
manner and with the effect stated therein; provided, however, (a) the Company
shall specify, in accordance with the provisions of this Supplemental Indenture,
those bonds of Collateral Series A which are to be redeemed if only a part
thereof are to be redeemed, and payments in redemption of bonds of Collateral
Series A shall be made directly by the Company to the registered owners of the
bonds entitled thereto; and (b) the provisions of Section 11.03(b) of the 1941
Mortgage shall not be applicable to any such redemption. The Company shall not
exercise any option to redeem on any date all or any part of the bonds of
Collateral Series A unless it shall give a valid direction under the Senior
Indenture for the redemption on such date of an equal amount of Related
Securities. Notice of each such redemption shall be hand delivered or mailed,
by certified mail, with return receipt requested, at least forty-five (45) days
prior to the redemption date, to the registered owner of the bonds which are to
be redeemed at its address appearing on the Company's books for registration and
registration of transfer. Such delivery or mailing (but not the receipt thereof
or the return of the receipt so requested) shall be a condition to the
redemption of the bonds. All bonds so redeemed shall forthwith be delivered to
the Trustee and cancelled, but only when the principal, premium, if any, and
accrued interest thereon is paid in full. The Trustee, when required to select
bonds of Collateral Series A for redemption, shall promptly notify the Company,
and the Company, when selecting bonds of Collateral Series A for redemption,
shall promptly notify the Trustee, in writing of the distinctive numbers of the
bonds selected for redemption in whole or in part. For the purpose only of
complying with the Indenture (particularly Section 11.02 thereof) in connection
with the redemption of bonds of Collateral Series A, for each $1,000 principal
amount of bonds authenticated and delivered hereunder there shall be assigned a
number in such manner and at such time as the Trustee or the Company shall deem
appropriate.]

SECTION 1.05. The Company shall call for redemption all of the bonds
of the Collateral Series A then outstanding, and shall on the redemption date
therefor redeem the same at a price equal to 100% of the principal amount
thereof, together with accrued interest to the redemption date, in the event
that an event of default has occurred and is continuing

9
<PAGE>

under Section 6.01 of the Senior Indenture, and the Senior Trustee has
declared the principal of all Related Securities then outstanding immediately
due and payable (or such principal has become ipso facto immediately due and
payable) pursuant to Section 6.02 of the Senior Indenture. The redemption
date shall be the accelerated maturity date of the Related Securities;
provided, however, that such requirement of redemption shall be deemed to be
waived if prior to the date fixed for such redemption of the bonds of
Collateral Series A, the acceleration of the Related Securities is waived or
annulled. Any provision of Article XI of the Indenture notwithstanding, no
prior notice of such redemption of the bonds of Collateral Series A to the
Trustee or the Senior Trustee shall be required.]

SECTION 1.06. [Subject to the provision of Section 1.04, bonds of
Collateral Series A may be redeemed in part, but the portion of any such bond
so redeemed in part shall be One Thousand Dollars ($1,000) or an integral
multiple thereof. In case any bond shall be redeemed in part only, payment
of the redemption price of such portion of the bond of Collateral Series A
shall be made by the Company (or Trustee, as the case may be) to the
registered owner thereof, at its address appearing on the Company's books for
registration and registration of transfer of bonds of Collateral Series A
without presentation or surrender thereof, provided there is on file with the
Company and Trustee (and not theretofore rescinded by written notice from
such registered owner to the Company and Trustee) a written commitment from
such registered owner to the effect that (1) payments will be so made, and
(2) such registered owner will make notations on such bond or a paper
attached thereto of the portion thereof so redeemed. Prior to any transfer
by the registered owner of any bond of Collateral Series A, the same shall be
surrendered to the Company or Trustee for appropriate notation thereon of, or
in exchange for a new bond or bonds for, the unredeemed balance of the
principal amount thereof. The Trustee shall not be under any duty to
determine that any of the notations mentioned herein have been made or be
liable in any manner with respect thereto.]

SECTION 1.07. The Company shall not be obligated to make any
transfer of bonds of Collateral Series A for a period of fifteen (15) calendar
days next preceding any interest payment date, or next preceding any selection
by lot of bonds to be redeemed. The Company shall not be obligated to make
transfers of any bonds called or being called for redemption.

SECTION 1.08. No charge shall be made to any registered owner of any
bond of Collateral Series A for any transfer of bonds of said series except for
any tax or other governmental charge required to be paid in connection
therewith.

SECTION 1.09. The signatures of the President or a Vice President
and of the Secretary or an Assistant Secretary upon the bonds of Collateral
Series A may be facsimile signatures imprinted or otherwise reproduced on such
bonds. Any such facsimile signature shall have the same effect and shall be
subject to the same provisions set forth in Section 2.13 of the 1941 Mortgage as
to signatures upon bonds generally.

SECTION 1.10. In the event that an interest payment or maturity date
or a date fixed for redemption of any bond of Collateral Series A shall be a
Saturday, Sunday or a legal holiday or a day on which banking institutions in
the city of location of the registered address of the owner are authorized by
law to close, then payment of interest or principal (and

10
<PAGE>

premium, if any) need not be made on such date, but may be made on the next
succeeding business day not a Saturday, Sunday or a legal holiday or a day upon
which banking institutions in the city of location of the registered address of
the owner are authorized by law to close, with the same force and effect as if
made on the date of maturity, interest date, or the date fixed for redemption,
and no interest shall accrue for the period after such date.

SECTION 1.11. Bonds of Collateral Series A which have been redeemed
or have been paid at maturity shall not be reissued as bonds of said series, but
may be made the basis for the issuance of additional bonds of any series
hereafter created, or credits may be taken or cash withdrawn on the basis
thereof under any applicable provisions of the 1941 Mortgage or any future
supplemental indenture.

ARTICLE II.

Confirmation of Lien

SECTION 2.01. The Company, in order to record the description of,
and confirm unto the Trustee, certain property acquired after the execution and
delivery of the 1941 Mortgage and now subject to the lien thereof by virtue of
the provisions of the 1941 Mortgage conveying to the Trustee property acquired
after its execution and delivery, by these presents does grant, bargain, sell,
warrant, release, convey, assign, transfer, mortgage, pledge, set over and
confirm unto Firstar Bank Milwaukee, National Association, as Trustee, and to
its respective successors in said trust forever, subject to the rights reserved
by the Company in and by other provisions of the Indenture and this Supplemental
Indenture, all of the property described and mentioned or enumerated or referred
to in a schedule hereto annexed and marked Schedule A, reference to said
schedule for a description and enumeration of the property therein described and
enumerated being hereby made with the same force and effect as if the same were
incorporated herein at length;

Together with all and singular the tenements, hereditaments and
appurtenances belonging or in any wise appertaining to the aforesaid property or
any part thereof with the reversion and reversions, remainder and remainders,
tolls, rents and revenues, issues, income, product and profits thereof, and all
the estate, right, title and interest and claim whatsoever, at law as well as in
equity, which the Company now has or may hereafter acquire in and to the
aforesaid property and every part and parcel thereof;

To have and to hold all said properties, mortgaged, pledged or
conveyed by the Company as aforesaid, or intended so to be, unto the Trustee and
its successors and assigns forever, subject, however, to permissible
encumbrances as defined in the 1941 Mortgage; but in trust, nevertheless, for
the same purposes and upon the same conditions as are fully set forth in the
Indenture, which is hereby referred to.

<PAGE>

ARTICLE III.

Particular Covenants Of The Company

In addition to the covenants contained in the Indenture, the Company
hereby covenants as follows:

SECTION 3.01. That it is duly authorized under the laws of the State
of Wisconsin and under all other applicable provisions of law to create and
issue the bonds of Collateral Series A, and to execute and deliver this
Supplemental Indenture, and that all corporate action on its part for the
creation and issue of said bonds and the execution of this Supplemental
Indenture has been duly and effectually taken, and that said bonds when issued
and delivered to the owners thereof are and will be valid and enforceable
obligations of the Company, and that the Indenture is and always will be a valid
mortgage and deed of trust to secure the payment of said bonds.

SECTION 3.02. That it is lawfully possessed of all the property
mortgaged and pledged by the Indenture; that it will maintain and preserve the
lien of the Indenture on the property mortgaged and pledged thereby in
accordance with the terms thereof and hereof so long as any of the bonds issued
thereunder are outstanding; and that it has good right and lawful authority to
mortgage and pledge the property mortgaged and pledged thereby as provided in
and by the Indenture; and that the same is free and clear of all liens and
encumbrances, except permissible encumbrances as defined in the Indenture.

SECTION 3.03. That the Company will duly and punctually pay to the
registered owner of bonds of Collateral Series A issued under and secured by the
Indenture and this Supplemental Indenture the principal and interest of said
bonds at the dates and place and in the manner mentioned in such bonds.

SECTION 3.04. That the Trustee shall not incur any liability by
reason of any default, failure or delay on the part of the Company to observe or
perform its covenants contained in this Article III.

ARTICLE IV.

Miscellaneous

SECTION 4.01. The recitals of fact herein and in the bonds hereby
created contained (except the Trustee's Certificate) shall be taken as
statements of the Company and shall not be construed as made or warranted by the
Trustee. The Trustee makes no representations as to the validity of this
Supplemental Indenture or of the bonds issued under the Indenture by virtue
hereof. Except as herein otherwise provided, no duties, responsibilities or
liabilities are assumed, or shall be construed to be assumed, by the Trustee by
reason of this Supplemental Indenture other than as set forth in the Indenture;
and this Supplemental Indenture is executed and accepted on behalf of the
Trustee, subject to all the terms and conditions set forth in the Indenture, as
fully to all intents as if the same were herein set forth at length.

<PAGE>

SECTION 4.02. This Supplemental Indenture shall be construed in
connection with and as a part of the Indenture.

SECTION 4.03. (a) Whenever in this Supplemental Indenture either of
the parties hereto is named or referred to, such reference shall be deemed to
include the successors or assigns of such party, and all the covenants and
agreements in this Supplemental Indenture contained by or on behalf of the
Company or by or on behalf of the Trustee shall bind and inure to the benefit of
the respective successors and assigns of such parties, whether so expressed or
not.

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

SECTION 4.04. (a) If any provision of this Supplemental Indenture
limits, qualifies, or conflicts with another provision of this Supplemental
Indenture or of the Indenture required or deemed to be included in indentures
qualified under the Trust Indenture Act of 1939 (as enacted prior to the date of
this Supplemental Indenture) by any of Sections 310 to 317, inclusive, of the
said Act, such required provisions shall control.

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

SECTION 4.05. This Supplemental Indenture may be executed in several
counterparts, and all said counterparts executed and delivered, each as an
original, shall constitute but one and the same instrument.

SECTION 4.06. This Supplemental Indenture shall be effective and
binding from and after the time of actual execution and delivery thereof,
notwithstanding the fact that such execution and delivery may occur prior or
subsequent to ________ __, 199_.

SECTION 4.07. The debtor and its mailing address is WISCONSIN PUBLIC
SERVICE CORPORATION, 700 North Adams Street, P.O. Box 19001, Green Bay,
Wisconsin 54307. The secured party and its address, from which information
concerning the security interest hereunder may be obtained, is FIRSTAR BANK
MILWAUKEE, N.A., NATIONAL ASSOCIATION, Corporate Trust Department, 1555 North
RiverCenter Drive, Suite 301, Milwaukee, Wisconsin 53212.

IN WITNESS WHEREOF, the party of the first part has caused its
corporate name and seal to be hereunto affixed and this Supplemental Indenture
to be signed by its Chairman, President or Vice President, and attested by its
Secretary or an Assistant Secretary, for and in its behalf, and the party of the
second part has caused its corporate name and seal to be hereunto affixed, and
this Supplemental Indenture to be signed by its President, a Vice

13
<PAGE>

President or an Assistant Vice President, and attested by its Secretary or an
Assistant Secretary, for and in its behalf, all done as of the first day of
December, 1998.

WISCONSIN PUBLIC SERVICE CORPORATION,

By:
--------------------------------
Vice President
(SEAL)

Attest:

- -----------------------------
Secretary

Executed by Wisconsin Public Service
Corporation, in presence of:

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

14
<PAGE>

FIRSTAR BANK MILWAUKEE, N.A. NATIONAL ASSOCIATION
As Trustee,

By:
--------------------------------
Vice President
(SEAL)

Attest:

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

Assistant Secretary

Executed by Firstar Bank Milwaukee N.A., National Association
in presence of:

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

15
<PAGE>

STATE OF WISCONSIN }
} ss.
BROWN COUNTY }

Personally came before me this _______ day of __________, A.D. 1998,
______________, to me known to be the Vice President, and _______________, to me
known to be the Secretary of the above-named WISCONSIN PUBLIC SERVICE
CORPORATION, the corporation described in and which executed the foregoing
instrument, and to me known to be the persons who as such officers executed the
foregoing instrument in the name and behalf of said corporation, and
acknowledged the same, and acknowledged that the seal affixed to said instrument
is the corporate seal of said corporation, and that they signed, sealed and
delivered said instrument in the name and behalf of said corporation by
authority of its Board of Directors and said ______________ and _______________
then and there acknowledged said instrument to be the free act and deed of said
corporation by each of them voluntarily executed.

Given under my hand and notarial seal this _______ day of
_____________, A.D. 1998.

Notary Public, Brown County, Wisconsin
My commission expires
-----------------
(NOTARIAL SEAL)

16
<PAGE>

STATE OF WISCONSIN }
} ss.
MILWAUKEE COUNTY }

Personally came before me this ______ day of ____________, A.D. 1998,
_________________, to me known to be a Vice President and ________________, to
me known to be an Assistant Secretary of the above-named FIRSTAR BANK MILWAUKEE,
N.A., NATIONAL ASSOCIATION, the corporation described in and which executed the
foregoing instrument, and to me known to be the persons who as such officers
executed the foregoing instrument in the name and behalf of said corporation,
and acknowledged the same, and acknowledged that the seal affixed to said
instrument is the corporate seal of said corporation, and that they signed,
sealed and delivered said instrument in the name and behalf of said corporation
by authority of its Board of Directors and said _________________ and
_________________ then and there acknowledged said instrument to be the free act
and deed of said corporation by each of them voluntarily executed.

Given under my hand and notarial seal this ______ day of
_____________, A.D. 1998.

------------------------------------------
Notary Public, Milwaukee County, Wisconsin
My commission is permanent

(NOTARIAL SEAL)

This instrument was drafted by Attorney Michael S. Nolan of the law firm of
Foley & Lardner, Milwaukee, Wisconsin.

17
<PAGE>

A-1

SCHEDULE A

The property referred to in Article II of the foregoing Supplemental
Indenture from Wisconsin Public Service Corporation to Firstar Bank
Milwaukee N.A., National Association (successor to Firstar Trust Company,
formerly known as First Wisconsin Trust Company), Trustee, dated as of
December 1, 1998 is that herein specifically described and enumerated or
referred to in Parts I and II of this Schedule A:

PART I - PROPERTY LOCATED IN WISCONSIN

BROWN COUNTY

WO 1514-93

Lot 7, Block 26, Eastman's Addition, City of Green Bay, Brown County,
Wisconsin.

WO 1590-93

Lot Seven (7), Block Fifty-eight (58), according to the recorded Map of
Eastmans Addition to the City of Green Bay, in the City of Green Bay, East Side
of Fox River, Brown County, Wisconsin.

WO 1504-96

Lot Eight (8), Block Twenty-six (26) in Eastman's Addition to the City of
Green Bay, Brown County, Wisconsin, according to the recorded Plat thereof.

Tax Parcel No. 7-311.

PROJECT ID 0159996000

Those parts of Lots 1 and 2, George Langton's Subdivision of the North
7/9ths of Private Claim 25, West, according to the recorded Plat thereof, in the
Village of Ashwaubenon, Brown County, Wisconsin described as:

Parcel I: Commencing at the intersection of the South line of County
Highway "HH" (Hanson Road) and the West line of U.S. Highway 41; thence South
29 DEG. 58' 40" West along the West line of U.S. Highway 41, 625 feet to the
POINT OF BEGINNING; thence continuing South 29 DEG. 58' 40" West along the
West line of said U.S. Highway 41, 350 feet; thence North 64 DEG. 03' West
1543.41 feet to the West line of said Lot 2; thence North 25 DEG. 47' East
along said West line 349.13 feet; thence South 64 DEG. 03' East 1569.00 feet
to the point of beginning, EXCEPTING THEREFROM the East 50 feet and

<PAGE>

A-2

the West 40 feet both being used for road purposes, AND EXCEPTING THEREFROM
the following:

That part of Lot 1, George Langton Subdivision of the North 7/9ths of
Private Claim 25, West side of Fox River, according to the recorded Plat
thereof, in the Village of Ashwaubenon, Brown County, Wisconsin, described as
follows:

Commencing at the intersection of the South line of County Highway "HH"
(Hanson Road), and the West line of U.S. Highway 41, thence South 29 DEG. 58'
40" West, 625.0 feet along the West line of U.S. Highway 41; thence North
64 DEG. 03' 00" West, 615.60 feet to the Northwest corner of property
described in Jacket 1847 Image 3, Brown County Records being the POINT OF
BEGINNING; thence South 25 DEG. 47' 00" West, 319.74 feet along the Westerly
boundary of said Jacket 1847 Image 3; thence North 63 DEG. 06' 53" West, 75.60
feet; thence North 26 DEG. 13' 29" East, 318.51 feet; thence South 64 DEG. 03'
00" East, 73.13 feet along the Westerly extension of the Northerly line of
Jacket 1847 Image 3 to the point of beginning, AND EXCEPTING THEREFROM THE
FOLLOWING:

Commencing at the intersection of the South line of County Highway "HH"
(Hanson Road) and the West line of U.S. Highway 41; thence South 29 DEG. 58'
40" West along the West line of said Highway 625.00 feet to the place of
beginning of the property to be herein excepted; thence continuing South
29 DEG. 58' 40" West along the West line of said U.S. Highway 41, 350.00 feet;
thence North 64 DEG. 03' West 590 feet; thence North 25 DEG. 47' East and
parallel with the West line of said Lot 2, 349.13 feet to the North line of
the above described tract; thence South 64 DEG. 03' East along the North line
of the above described tract to the place of beginning; Together with an
easement over the following:

PARCEL II: A strip of land 19 feet in width, being 9 1/2 feet wide on
each side of the following described center line:

Commencing at the intersection of the South line of County Highway "HH"
(Hanson Road) and the West line of U.S. Highway 41; thence South 29 DEG. 58'
40" West along the West line of U.S. Highway 41, 625 feet; thence continuing
South 29 DEG. 58' 40" West along the West line of said U.S. Highway 41, 350
feet; thence North 64 DEG. 03' West 590.00 feet; thence North 25 DEG. 47' East
17.5 feet to the place of beginning of the centerline of the railroad spur
tract easement; thence South 56 DEG. 44' East 209.6 feet to the point of
intersection with the centerline of an existing railroad spur track on the
adjacent property of Wisconsin Public Service Corporation and thence
terminating, EXCEPTING THEREFROM that portion of the described easement area
lying South of the line described in the foregoing description as bearing
North 64 DEG. 03' West 590.00 feet; being the easement set out in a certain
Grant of Appurtenant Easement, dated December 20, 1974 and recorded in the
office of the Register of Deeds for Brown County, Wisconsin in Volume 1099 of
Records, Page 19; Together with an easement over the following:

<PAGE>
A-3

Parcel III: The North 40 feet of the East 500 feet of the property
described in Volume 733 of Records, Page 624, Brown County, Wisconsin Records
being described as: Commencing at the intersection of the South line of
County Trunk Highway "HH" (Hanson Road) and the West line of U.S. Highway 41;
thence South 29 DEG. 58' 40" West along the West line of said highway 975.0
feet to the POINT OF BEGINNING; thence continuing South 29 DEG. 58' 40" West
843.19 feet; thence North 63 DEG. 22' 08" West 1481.67 feet; thence North
25 DEG. 47' East 823.49 feet; thence South 64 DEG. 03' East 1543.41 feet to the
place of beginning, being the Easement dated December 27, 1974 and recorded
in the office of the Register of Deeds for Brown County, Wisconsin in Volume
1099 of Records, Page 542.

Tax Parcel No. VA-177-4

PROJECT ID 0151196000

Lot 11, Block 26 Eastman's Addition City of Green Bay, Wisconsin.

Parcel Identification No. 7-314

DOOR COUNTY

PROJECT ID 0150596000

Part of the Southwest one-quarter of the Southwest one-quarter (SW
1/4-SW 1/4) of Section 20, Township 30 North, Range 27 East, Town of Egg
Harbor, Door County, Wisconsin, described as follows:

The northerly 50 feet of the southerly 233 feet of the easterly 265 feet
of the westerly 298 feet and the easterly 85 feet of the westerly 298 feet of
the northerly 150 feet of the southerly 183 feet.

Parcel Identification No. 008-03-20302733A

LINCOLN COUNTY

PROJECT ID 0155896000

That part of the Southwest One-quarter of the Southwest One-quarter (SW
1/4 SW 1/4), Section One (1), Township Thirty-four (34) North, Range Six (6)
East, Town of Bradley, Lincoln County, Wisconsin described as follows:

Commencing at the Southwest corner of said SW 1/4 SW 1/4; thence N
89 DEG. 23' E., 100 feet to the point of beginning; thence N. 0 DEG. 37' W.,
160 feet; thence

<PAGE>

A-4

N. 89 DEG. 23' E., 275 feet; thence S. 0 DEG. 37' E., 160 feet; thence
S. 89 DEG. 23' W., 275 feet to the point of beginning.

Tax Parcel No. Part of 04.013406.011.001

MARATHON COUNTY

WO 1522-93

Parcel one (1) of Certified Survey Map No. 5351 recorded in the office
of the Register of Deeds for Marathon County, Wisconsin, in Volume 19 of
Certified Survey Maps on page 219; being a part of the Southwest quarter (SW
1/4) of the Southeast quarter (SE 1/4) of Section three (3), Township
twenty-seven (27) North, Range seven (7) East, in the Town of Kronenwetter,
Marathon County, Wisconsin; subject to existing easements of record.

WO 1541-95

Parcel two (2) of Certified Survey Map No. 8726 recorded in the office
of the Register of Deeds for Marathon County, Wisconsin, in Volume 34 of
Certified Survey Maps on page 104, as Document Number 1055283; being a part
of the Southeast quarter (SE 1/4) of Section three (3), Township twenty-seven
(27) North, Range seven (7) East, in the Town of Kronenwetter, Marathon
County, Wisconsin.

WO 1546-95

The West seven hundred fifty (750) feet of the Northwest quarter (NW
1/4) of the Southeast quarter (SE 1/4) of Section three (3), Township
twenty-seven (27) North, Range seven (7) East, in the Town of Kronenwetter,
Marathon County, Wisconsin.

MARINETTE COUNTY

WO 1551-92

Outlet 1 of Certified Survey Map No. 776 as recorded as Document No.
514964 in the Marinette County Register of Deeds Office, lying in part of the
Southeast one-quarter of the Southwest one-quarter (SE1/4-SW1/4), Section 14,
Township 30 North, Range 20 East, Village of Coleman, Marinette County,
Wisconsin.

<PAGE>

A-5

WO 1554-94

Lot 1 of Certified Survey Map No. 887 as recorded in the Marinette
County Register of Deeds Office as Document No. 528522; being part of
Government Lot 2, Section 21, Township 32 North, Range 20 East, Town of
Stephenson, Marinette County, Wisconsin.

WO 1555-94

That part of the Southwest one-quarter of the Northwest one-quarter (SW
1/4 - NW 1/4) of Section 29, Township 32 North, Range 19 East, as recorded in
Volume 276 of Deeds, Page 344, in the Marinette County Register of Deed
office lying southwesterly of County Trunk Highway "W" and southeasterly of
Schramm Road, Town of Stephenson, Marinette County, Wisconsin, containing
approximately 2.23 acres.

WO 1532-94

The South One-Half of the West One-Half of the Northeast Quarter of the
Northeast Quarter (S 1/2 of W 1/2 of NE 1/4 of NE 1/4) and the South One-Half of
the Northwest Quarter of the Northeast Quarter (S 1/2 of NW 1/4 of NE 1/4), all
in Section Ten (10), in Township Thirty (30) North, of Range Twenty-three (23)
East; situate in the Town of Peshtigo, Marinette County, Wisconsin.

OCONTO COUNTY

WO 1556-95

Lot One of Certified Survey Map No. 2233 recorded in Volume 13 Certified
Survey Map Page 126, Document No. 426592, being part of the Southeast
One-quarter of the Southwest One-quarter (SE 1/4 of the SW 1/4) of Section 23,
Township 33 North, Range 15 East, Town of Townsend, Oconto County, Wisconsin.

WO 1557-95

That part of the Northeast one-quarter of the Southeast one-quarter
(NE 1/4-SE 1/4), Section 5, Township 32 North, Range 16 East, that lies north of
the Town Highway described as follows: Beginning at the East one-quarter
section corner of said Section 5; thence running southwesterly along the north
boundary of Town Highway 526.5 feet to an iron stake (said stake being 1-1/2
rods from center of Highway); thence north at right angles to said Highway
boundary 144 feet to a stake on East-West one-quarter line; thence east along
said one-quarter line 544.3 feet to place of beginning.
<PAGE>

A-6

ONEIDA COUNTY

PROJECT ID 0156196000

That part of the NE 1/4 of the SE 1/4, Section 19, Township 36 North, Range
11 East, described as follows:

Commencing at the East one-quarter corner of said Section 19; thence S.
0 DEG. 00'00" W., along the East line of the Southeast one-quarter of said
Section 19 a distance of 618.00 feet to the point of beginning. Thence
continuing S. 00 DEG. 00'00" W., 225.00 feet; thence S. 89 DEG. 10'00" W.,
225.00 feet; thence N. 00 DEG. 00'00" E., 225.00 feet; thence N. 89 DEG.
10'00" E., 225.00 feet to the point of beginning.

Part of Parcel Identification No. 01801 585

SHEBOYGAN COUNTY

WO 1222-94

A thirteen and four-tenths percent (13.4%) tenant-in-common interest in and
to the following-described parcel of real property:

Parcel 1:
Part of Government Lot Three (3), Section 2, commencing 418.77 feet
South and 1477.94 feet East of center of said Section, said point
being the point of beginning, thence South 10 DEG. -4' West, 283.76
feet, thence South 21 DEG. -18' West to center of Black River, said
point being 1185 feet East of the centerline of County Trunk EE,
thence North to the center of Town Road, thence East to beginning,
being a part of Section 2, Township 14 North, Range 23 East.

Parcel 2:
Also commencing 1185 feet more or less East of the Southwest corner of
Government Lot Three (3), thence North to the center of Black River,
thence downstream on center of said river, to the South line of
Government Lot Three (3), thence West on said South line to beginning,
being a part of Section 2, Township 14 North, Range 23 East.

Tax Key #451300.
<PAGE>

A-7

PART II - PROPERTY LOCATED IN MICHIGAN

MENOMINEE COUNTY

WO 1517-93

All that part of Government Lot One (1) of Section Eleven (11), Township
Thirty-one (31) North, Range Twenty-seven (27) West, City of Menominee,
Menominee County, Michigan, being bounded and described as follows:

Commencing at the Southwest corner of Lot Twelve (12) of Block Three (3) of
"Ludington and Carpenter's First Addition" to the City of Menominee, and
subdivision of Blocks Eight (8), Fourteen (14) and Fifteen (15); thence South
Thirty-four Degrees (34 DEG.) Twenty-five Minutes (25') East, One Hundred Fifty
and Zero Hundredths (150.00) feet along the Easterly line of First Street, to a
Five-eighths inch (5/8") diameter iron rod; thence North Fifty-five Degrees
(55 DEG.) Thirty-five Minutes (35') East, One Hundred Nineteen and Fifty-two
Hundredths (119.52) feet (recorded as One Hundred Nineteen and Sixty-three
Hundredths (119.63) feet) to an existing iron monument, and the point of
beginning of the parcel hereinafter described.

Thence Northeasterly, Sixty-one and Seventy-eight Hundredths (61.78) feet
along the arc of a Two Hundred Six and Sixty-eight Hundredths (206.68) foot
radius curve to the left, whose chord bears North Seventy-two Degrees (72 DEG.)
Fifty-six Minutes (56') Thirty-six Seconds (36") East, Sixty-one and Fifty-five
Hundredths (61.55) feet; thence North Ten Degrees (10 DEG.) Thirty-seven Minutes
(37') Forty-three Seconds (43") East, Fifty-five and Forty-six Hundredths
(55.46) feet; thence North Forty-five Degrees (45 DEG.) Twenty-eight Minutes
(28') Forty-eight Seconds (48") West, Seventy-four and Seventy-three Hundredths
(74.73) feet; thence North Seventy-nine Degrees (79 DEG.) Twenty-two Minutes
(22') Seventeen Seconds (17") West, Sixty-eight and Ninety-six Hundredths
(68.96) feet; thence Southwesterly, Twenty-five and One Hundredths (25.01) feet
along the arc of a Three Hundred Eighteen and Sixty-nine Hundredths (318.69)
foot radius curve to the left whose chord bears South Sixty-one Degrees (61
DEG.) Fifteen Minutes (15') Fifty-two Seconds (52") West, Twenty-five and Zero
Hundredths (25.00) feet; thence South Fifty-nine Degrees (59 DEG.) One Minute
(01') Zero Seconds (00") West, Twelve and Ninety-six Hundredths (12.96) feet;
thence South Ten Degrees (10 DEG.) Thirty-seven Minutes (37') Forty-three
Seconds (43") West, Thirty and Seventy-five Hundredths (30.75) feet to the
Southwesterly right-of-way of vacated Harbor Drive (a/k/a Highway M-173); thence
North Fifty-nine Degrees (59 DEG.) One Minute (01') Zero Seconds (00") East,
Thirty-three and Thirty-eight Hundredths (33.38) feet along said right-of-way,
and the Northwesterly line of lands described in Liber 211 of Deeds on Pages
302-303, to the point of curvature of a Two Hundred Ninety-five and Sixty-nine
Hundredths (295.69) foot radius curve to the right; thence Northeasterly
Thirty-eight and Ten Hundredths (38.10) feet along said right-of-way, along the
arc of said curve having a chord bearing North Sixty-four Degrees (64 DEG.)
Twenty-six Minutes (26') Fifty-seven
<PAGE>

A-8

Seconds (57") East, Thirty-Eight and Eight Hundredths (38.08) feet; thence South
Thirty-six Degrees (36 DEG.) Nineteen Minutes (19') Zero Seconds (00") East, One
Hundred Seventeen and Eighty-two Hundredths (117.82) feet along the Easterly
line of lands described in Liber 211 of Deeds on Pages 302-303; thence South
Fifty-five Degrees (55 DEG.) Thirty-five Minutes (35') Zero Seconds (00") West,
Fifty and Thirty-seven Hundredths (50.37) feet, along the Southeasterly line of
said lands, to the point of beginning, containing Six Thousand Five Hundred
Twenty-one and Eighty Hundredths (6,521.80) square feet.

<PAGE>

FOLEY & LARDNER

ATTORNEYS AT LAW

CHICAGO FIRSTAR CENTER SACRAMENTO
DENVER 777 EAST WISCONSIN AVENUE SAN DIEGO
JACKSONVILLE MILWAUKEE, WISCONSIN 53202-5367 SAN FRANCISCO
LOS ANGELES TELEPHONE (414) 271-2400 TALLAHASSEE
MADISON FACSIMILE (414) 297-4900 TAMPA
MILWAUKEE WASHINGTON, D.C.
ORLANDO WEST PALM BEACH

WRITER'S DIRECT LINE
(414) 297-5672

EMAIL ADDRESS CLIENT/MATTER NUMBER
[email protected] 086120/0642

November 24, 1998

Wisconsin Public Service Corporation
700 North Adams Street
Green Bay, Wisconsin 54307-9001

Gentlemen:

We have acted as counsel for Wisconsin Public Service
Corporation (the "Company") in connection with the Company's proposed
issuance and sale of up to $102,000,000 of Senior Secured Debt
Securities ("Securities"), including the initial series of $50,000,000
of Securities (the "Initial Series of Securities") under the
Registration Statement (Form S-3) filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended.

We are familiar with the proceedings to date with respect to such
proposed issuance and the Registration Statement and other documents
related thereto, and have satisfied ourselves as to such matters of law and
fact as we have considered relevant for purposes of this opinion.

We are of the opinion that:

1. The Company is a corporation duly organized and existing
under the laws of the State of Wisconsin, and duly authorized and qualified
to transact the business in which it is engaged in the State of Wisconsin.

2. The Indenture and proposed form of Supplemental Indenture
between the Company and Firstar Bank Milwaukee, National Association
creating the Securities (Exhibits 4A and 4C to the Registration Statement)
are in due legal form.

3. The proposed form of the Securities (included in Exhibits 4A
and 4C to the Registration) is in due legal form.

4. When (a) the Registration Statement shall have become
effective and the Indenture, as amended and supplemented by one or more
Supplemental Indentures, including

ESTABLISHED 1842

A MEMBER OF GLOBALEK WITH MEMBER OFFICES IN BERLIN, BRUSSELS, DARSDEN,
FRANKFURT, LONDON, SINGAPORE, STOCKHOLM AND STUTTGART

<PAGE>

FOLEY & LARDNER

Wisconsin Public Service Corporation
November 24, 1998
Page 2

the first supplemental indenture creating the Initial Series of Securities,
has been qualified under the Trust Indenture Act of 1939 as amended; (b)
the issuance of the Securities including the Initial Series of
Securities have been duly authorized by the Public Service Commission of
Wisconsin and by the Board of Directors of the Company or a duly
constituted committee thereof; (c) the Indenture and Supplemental
Indentures for the Securities have been executed by the proper parties
and have been delivered; and (d) the Securities (including the Initial
Series of Securities) shall have been duly executed, authenticated and
delivered against payment of the agreed consideration therefor;

(i) The Securities (including the Initial Series of
Securities) will be legally issued, and valid and binding obligations
of the Company, with the express terms and provisions as set forth in
the Indenture, as amended and supplemented by the Supplemental
Indentures; and

(ii) no approvals, other than those referred to above,
will be required in connection with the creation and issuance of the
Securities (including the Initial Series of Securities).

We hereby consent to the use of this opinion as an exhibit to the
above-mentioned Registration Statement.

Sincerely,

FOLEY & LARDNER

By /s/ Michael S. Nolan
--------------------------------
Michael S. Nolan

<PAGE>
EXHIBIT 12

WISCONSIN PUBLIC SERVICE CORPORATION
RATIO OF EARNINGS TO FIXED CHARGES (UNAUDITED)

Nine Months Twelve Months
Ended Ended
September 30 September 30 Year Ended December 31
------------ ------------- -------------------------------------------------

(Thousands of Dollars)

1998 1998 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
EARNINGS

Income before interest (A) 64,146 87,888 90,831 85,334 85,037 80,767 87,755

ADJUSTMENTS

Federal and state income taxes 24,657 33,039 33,371 31,515 31,138 30,040 32,539
Interest factor applicable to rentals (B) 2,120 2,848 3,061 3,030 2,566 1,511 1,604
AFUDC, borrowed funds 95 106 100 128 68 139 200
------------ ----------------------------------------------------------------

Total earnings as defined 91,018 123,881 127,363 120,007 118,809 112,457 122,098
------------ ----------------------------------------------------------------
------------ ----------------------------------------------------------------

FIXED CHARGES

Interest on long-term debt 15,614 22,106 22,530 22,512 23,409 23,407 24,393
Other interest 1,966 2,726 3,759 2,688 2,526 1,796 1,562
Interest factor applicable to rentals (B) 2,120 2,848 3,061 3,030 2,566 1,511 1,604
------------ ----------------------------------------------------------------

Total fixed charges 19,700 27,680 29,350 28,230 28,501 26,714 27,559
------------ ----------------------------------------------------------------
------------ ----------------------------------------------------------------

RATIO OF EARNINGS TO FIXED CHARGES 4.62 4.48 4.34 4.25 4.17 4.21 4.43
------------ ----------------------------------------------------------------
------------ ----------------------------------------------------------------
</TABLE>
NOTES:

(A) Income before interest includes net income plus interest on long-term debt
and other interest.

(B) Represents portion of rental expense estimated to be representative of the
interest factor.

<PAGE>

Exhibit 23.1

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our report dated January 29, 1998
included in Wisconsin Public Service Corporation's Annual Report on Form 10-K
for the year ended December 31, 1997, and to all references to our firm
included in this Registration Statement.

/s/ Arthur Andersen LLP
--------------------------
ARTHUR ANDERSEN LLP

Milwaukee, Wisconsin
November 24, 1998

<PAGE>

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY UNDER
THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE

-----------

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2) _________

-----------

FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)

39-0281225
(JURISDICTION OF INCORPORATION OR (I.R.S. EMPLOYER
ORGANIZATION IF NOT A U. S. NATIONAL BANK) IDENTIFICATION NUMBER)

777 EAST WISCONSIN AVENUE, MILWAUKEE, WISCONSIN 53202
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

WILLIAM J. SCHULZ, SENIOR VICE PRESIDENT AND SECRETARY
FIRSTAR BANK MILWAUKEE, N.A.
777 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN 53202
TELEPHONE (414) 765-5725
(NAME, ADDRESS, AND TELEPHONE NUMBER OF AGENT FOR SERVICE)

WISCONSIN PUBLIC SERVICE CORPORATION
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)

WISCONSIN 39-0715160
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)

700 NORTH ADAMS STREET
GREEN BAY, WISCONSIN 54307
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

SENIOR DEBT SECURITIES
(TITLE OF INDENTURE SECURITIES)

<PAGE>

Item 1. General Information.

Furnish the following information as to the trustee:

(a) Name and address of each examining or supervising authority to
which it is subject.

Comptroller of the Currency, Washington, D.C.
Office of Commissioner of Banking, Madison, Wisconsin
Federal Deposit Insurance Corporation, Washington, D.C.

(b) Whether it is authorized to exercise corporate trust powers.

The corporate trustee is authorized to exercise corporate trust
powers.

Item 2. Affiliations with the Obligor.

If the obligor is an affiliate of the trustee, describe each such
affiliation.

The obligor is not an affiliate of the trustee.

Item 3. Voting Securities of the Trustee.

Furnish the following information as to each class of voting
securities of the trustee:

AS OF NOVEMBER 23, 1998
COL. A COL. B
TITLE OF CLASS AMOUNT OUTSTANDING

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

Item 4. Trusteeships under Other Indentures.

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, furnish the
following information:

(a) Title of the securities outstanding under each such other indenture.

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

(b) A brief statement of the facts relied upon as a basis for the claim
that no conflicting interest within the meaning of Section 310(b)(1)
of the Act arises as a result of the trusteeship under any such other
indenture, including a statement as to how the indenture securities
will rank as compared with the securities issued under such other
indenture.

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

<PAGE>

Item 5. Interlocking Directorates and Similar Relationships with the Obligor
or Underwriters.

If the trustee or any of the directors or executive officers of the
trustee is a director, officer, partner, employee, appointee, or
representative of the obligor or of any underwriter for the obligor,
identify each such person having any such connection and state the
nature of each such connection.

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

Item 6. Voting Securities of the Trustee Owned by the Obligor or its
Officials.

Furnish the following information as to the voting securities of the
trustee owned beneficially by the obligor and each director, partner,
and executive officer of the obligor:

AS OF NOVEMBER 23, 1998

COL. A COL. B COL. C COL. D
<S> <C> <C> <C>
NAME OF OWNER TITLE OF CLASS AMOUNT OWNED PERCENTAGE OF
BENEFICIALLY VOTING SECURITIES
REPRESENTED BY
AMOUNT GIVEN
IN COL. C
</TABLE>

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

Item 7. Voting Securities of the Trustee Owned by Underwriters or their
Officials.

Furnish the following information as to the voting securities of the
trustee owned beneficially by each underwriter for the obligor and
each director, partner, and executive officer of each such
underwriter:

AS OF NOVEMBER 23, 1998

COL. A COL. B COL. C COL. D
<S> <C> <C> <C>
NAME OF OWNER TITLE OF CLASS AMOUNT OWNED PERCENTAGE OF
BENEFICIALLY VOTING SECURITIES
REPRESENTED BY
AMOUNT GIVEN
IN COL. C
</TABLE>

Per General Instruction B to form T-1, no response is required to this
item as the obligor is not presently in default.

<PAGE>

Item 8. Securities of the Obligor Owned or Held by the Trustee.

Furnish the following information as to securities of the obligor
owned beneficially or held as collateral security for obligations in
default by the trustee:

<TABLE>
<CAPTION>
AS OF NOVEMBER 23, 1998

COL. A COL. B COL. C COL. D
<S> <C> <C> <C>
TITLE OF CLASS WHETHER AMOUNT OWNED PERCENT OF
THE SECURITIES BENEFICIALLY OR HELD CLASS REPRESENTED
ARE VOTING AS COLLATERAL SECURITY BY AMOUNT GIVEN
OR NONVOTING FOR OBLIGATIONS IN COL. C
SECURITIES IN DEFAULT
</TABLE>

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

Item 9. Securities of Underwriters Owned or Held by the Trustee.

If the trustee owns beneficially or holds as collateral security for
obligations in default any securities of an underwriter for the
obligor, furnish the following information as to each class of
securities of such underwriter any of which are so owned or held by
the trustee:

AS OF NOVEMBER 23, 1998

COL. A COL. B COL. C COL. D
<S> <C> <C> <C>
NAME OF AMOUNT AMOUNT OWNED PERCENT OF
ISSUER AND OUTSTANDING BENEFICIALLY OR HELD CLASS REPRESENTED
TITLE OF CLASS AS COLLATERAL SECURITY BY AMOUNT GIVEN
FOR OBLIGATIONS IN IN COL. C
DEFAULT BY TRUSTEE
</TABLE>

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

Item 10. Ownership or Holdings by the Trustee of Voting Securities of Certain
Affiliates or Security Holders of the Obligor.

If the trustee owns beneficially or holds as collateral security for
obligations in default voting securities of a person who, to the
knowledge of the trustee (1) owns 10 percent or more of the voting
securities of the obligor or (2) is an affiliate, other than a
subsidiary, of the obligor, furnish the following information as to
the voting securities of such person:

AS OF NOVEMBER 23, 1998

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

<PAGE>

Item 11. Ownership or Holdings by the Trustee of any Securities of a Person
Owning 50 Percent or More of the Voting Securities of the Obligor.

If the trustee owns beneficially or holds as collateral security for
obligations in default any securities of a person who, to the
knowledge of the trustee, owns 50 percent or more of the voting
securities of the obligor, furnish the following information as to
each class of securities of such person any of which are so owned or
held by the trustee:

AS OF NOVEMBER 23, 1998

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

Item 12. Indebtedness of the Obligor to the Trustee.

Except as noted in the instructions, if the obligor is indebted to the
trustee, furnish the following information:

AS OF NOVEMBER 23, 1998

COL. A COL. B COL. C
<S> <C> <C>
NATURE OF INDEBTEDNESS AMOUNT OUTSTANDING DATE DUE
</TABLE>

Per General Instruction B to Form T-1, no response is required to this item as
the obligor is not presently in default.

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.

Per General Instruction B to Form T-1, no response is required to
this item as the obligor is not presently in default.

(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.

Per General Instruction B to Form T-1, no response is required to
this item as the obligor is not presently in default.

<PAGE>

Item 14. Affiliations with the Underwriters.

If any underwriter is an affiliate of the trustee, describe each such
affiliation.

Per General Instruction B to Form T-1, no response is required to this
item as the obligor is not presently in default.

Item 15. Foreign Trustee.

Identify the order or rule 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

Item 16. List of Exhibits.

List below all exhibits filed as part of this statement of
eligibility.

1. A copy of the Articles of Association of Firstar Bank Milwaukee, N.A.,
National Association (f/k/a First Wisconsin National Bank) as now in
effect (filed herewith).

2. Certificate of authority of the Trustee to commence business
(contained in Exhibit 1).

3. Authorization of the Trustee to exercise trust powers (filed
herewith).

4. A copy of the existing By-Laws of Firstar Bank Milwaukee, N.A.,
National Association (f/k/a First Wisconsin National Bank)
(filed herewith).

5. The consent of the Trustee required by Section 321(b) of the Trust
Indenture Act of 1939 (filed herewith).

6. A copy of the latest report of condition of the trustee published
pursuant to law or the requirement of its supervising or examining
authority (filed herewith).

SIGNATURE

Pursuant to the requirements of the Trust Indenture Act of 1939,
the trustee, Firstar Bank Milwaukee, N.A., National Association, a
corporation organized and existing under the laws of the United States, has
duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in the City of Milwaukee, and
State of Wisconsin, on the 23rd day of November, 1998.

FIRSTAR BANK MILWAUKEE, N.A., NATIONAL
ASSOCIATION
(Trustee)

By: /s/ Amy E. Nolde
----------------------------------------
AMY E. NOLDE, TRUST OFFICER
(Name and title)

By: /s/ Pamela Warner
----------------------------------------
PAMELA WARNER, TRUST OFFICER
(Name and title)

<PAGE>

EXHIBIT 1

FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION

ARTICLES OF ASSOCIATION

AS AMENDED TO
MARCH 27, 1995

AND

BY-LAWS

AS AMENDED TO
AUGUST 19, 1993

<PAGE>

ARTICLES OF ASSOCIATION
OF
FIRSTAR BANK MILWAUKEE, N.A., NATIONAL ASSOCIATION

AS AMENDED TO MARCH 27, 1995

<TABLE>
<CAPTION>
<S> <C> <C>
AMENDED 9/14/92 FIRST. The title of this Association shall be "Firstar Bank
Milwaukee,N.A., National Association."

SECOND. The place where the main banking house or office of
this Association shall be located, its operations of
discount and deposit carried on, and its general business
conducted, shall be Milwaukee, County of Milwaukee, State of
Wisconsin.

AMENDED 2/27/87 THIRD. The Board of Directors of this Association shall
consist of such number of its shareholders not less than
five nor more than twenty-five, as from time to time shall
be determined by a majority of the votes to which all of its
shareholders are at the time entitled. Each director,
during the full term of his or her directorship, shall own a
minimum of $1,000 aggregate par value of stock of this
Association or a minimum par value, fair market value or
equity interest of $1,000 of stock in the bank holding
company controlling this Association. A majority of the
Board of Directors shall be necessary to constitute a quorum
for the transaction of business. The Board of Directors, by
the vote of a majority of the full Board, may, between
Annual Meetings of the Shareholders, increase the membership
of the Board by not more than two members and by like vote
appoint qualified persons to fill the vacancies created
thereby.

FOURTH. The regular annual meeting of the Shareholders of
this Association shall be held at its main banking house or
other convenient place duly authorized by the Board of
Directors on such day of each year as is specified therefor
in the By-laws.

AMENDED 1/17/67 FIFTH. The amount of authorized capital stock of this Association shall
5/13/71 be Sixty-Three Million Dollars ($63,000,000) divided into 2,100,000
2/22/74 shares of common stock of the par value of Thirty Dollars ($30.00) each;
1/21/75 but said capital stock may be increased or decreased from time to time
10/27/75 in accordance with the provisions of the laws of theUnited States.
1/17/80
2/19/81
3/27/95
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
<S> <C> <C>
No holder of shares of the capital stock of any class of the
Association shall have any pre-emptive or preferential right
of subscription to any shares of any class of stock of the
Association, whether now or hereafter authorized, or to any
obligations convertible into stock of the Association,
issued or sold, nor any right of subscription to any thereof
other than such, if any, as the Board of Directors, in its
discretion may from time to time determine and at such price
as the Board of Directors may from time to time fix.

The Association may at any time or times authorize and issue
debt obligations, whether or not subordinated, without the
approval of the Shareholders.

AMENDED 2/16/78 SIXTH. The Board of Directors shall appoint one of its
members President of this Association, who shall be Chairman
of the Board, but the Board of Directors may appoint a
Director, in lieu of the President, to be Chairman of the
Board, who shall perform such other duties as may be
designated by the Board of Directors. In the absence of the
Chairman of the Board and or the President of this
Association, the Board of Directors may appoint any one of
the other officers or Directors of this Association to act
as temporary Chairman at a meeting of the Board of Directors
and to preside temporarily thereat; provided that such
temporary Chairman may not, unless he shall be a member of
the Board of Directors, have any right to vote at such
meeting. The Board of Directors shall have the power to
appoint one or more Vice Presidents, a Cashier and such
other officers as may be required to transact the business
of this Association, to fix the salaries to be paid to all
officers of this Association, and to dismiss such officers,
or any of them.

The Board of Directors shall have the power to define the
duties of officers and employees of this Association, to
require bonds from them, and to fix the penalty thereof; to
regulate the manner in which Directors shall be elected or
appointed, and to appoint judges of the election; to make
all by-laws that it may be lawful for them to make for the
general regulation of the business of this Association and
the management of its affairs, and generally to do and
perform all acts that it may be lawful for a Board of
Directors to do and perform.

SEVENTH. This Association shall have succession from the date of its
organization certificate until such time as it be dissolved
by the act of its shareholders in accordance with the
provisions of the banking laws of the United States, or
until its franchise becomes forfeited by reason of violation
of law, or until terminated by either a general or a special
act of Congress, or until its affairs be placed in the
hands of a receiver and finally wound up by him.

EIGHTH. The Board of Directors of this Association, or any three or
more shareholders owning, in the aggregate, not less than
ten percentum of the stock of this Association, may call a
special meeting of shareholders at any time provided,
however, that, unless otherwise provided by law, not less
than ten days prior to the date fixed for any such meeting,
a notice of the time, place and purpose of the
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
<S> <C> <C>
meeting shall be given by first-class mail, postage prepaid,
to all shareholders of record of this Association at their
respective addresses as shown upon the books of the
Association. These Articles of Association may be amended
at any regular or special meeting of the shareholders by the
affirmative vote of the shareholders owning at least a
majority of the stock of this Association, subject to the
provisions of the banking laws of the United States. The
notice of any shareholders' meeting, at which an amendment
to the Articles of Association of this Association is to be
considered, shall be given as hereinabove set forth.
</TABLE>

<PAGE>

Exhibit 3

UNITED STATES OF AMERICA
THE STATE OF WISCONSIN
STATE BANKING DEPARTMENT

WHEREAS, the FIRST WISCONSIN NATIONAL BANK, Milwaukee, Wisconsin, has
been granted FIDUCIARY POWERS, as witnessed by certified copy of such permit
granted by the Federal Reserve Board, under Subsection (k) of Section Eleven
(11) of the Federal Reserve Act, and

WHEREAS, said bank has complied with Section 221.04, subsection (6),
220.09 and 223.02 of the Revised Statutes of Wisconsin, by depositing
sufficient securities approved by this Department with the State Treasurer,

NOW, THEREFORE, I, Wm. E. Nuesse, Commissioner of Banks for the State of
Wisconsin, do concur in the permit as granted by the Federal Reserve Board,
authorizing said bank to act as Trustee, Executor, Administrator, Committee
of Estates of Lunatics, and in any other fiduciary capacity granted thereby.

THIS CONCURRENCE OF PERMIT shall be subject to revocation in whole or in
part, should the law relating to the fiduciary powers of national banks be
further restricted, or should the bank exercising these fiduciary powers fail
to comply with any or all provisions of the Statutes of Wisconsin.

IN TESTIMONY WHEREOF, I have hereunto set my hand
and caused my Official Seal to be affixed. Done at the
Hill Farms State Office Building, in the City of
Madison, this 10th Day of March, 1967.

/s/Wm. E. Nuesse
__________________________________________________
Wm. E. Nuesse
Commissioner of Banks

<PAGE>

EXHIBIT 4

F I R S T A R B A N K M I L W A U K E E , N . A .

B Y - L A W S
<PAGE>

ARTICLE I

SHAREHOLDERS

AMENDED: 12/18/75

SECTION 1. ANNUAL MEETING. The annual meeting of the shareholders, for the
purpose of electing directors and for the transaction of such other business
as may come before the meeting, shall be held on the third Thursday of
February of each year, at 8:30 o'clock in the morning, unless some other hour
shall have been designated by the Board of Directors. If the election of
directors shall not be held on the date designated herein for any annual
meeting of the shareholders, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special meeting of the
shareholders as soon thereafter as conveniently may be.

AMENDED: 6/19/80

SECTION 2. SPECIAL MEETINGS. Special meetings of the shareholders for any
purpose or purposes, unless otherwise prescribed by the laws of the United
States or the Articles of Association, may be called by the Chairman of the
Executive Committee, the Chairman of the Board, the President or the Board of
Directors, and shall be called by the Secretary upon a written request to him
signed by at least three shareholders owning in the aggregate not less than ten
percent of all outstanding shares of the Association entitled to vote at the
meeting.

SECTION 3. PLACE OF MEETING. The Board of Directors may designate any
convenient place in the City of Milwaukee, Wisconsin, as the place of meeting
for any annual meeting or for any special meeting. If no such designation is
made, the place of meeting shall be the main banking office of the
Association in the City of Milwaukee, Wisconsin. Any meeting may be adjourned
to reconvene at any place in the City of Milwaukee, Wisconsin, designated by
vote of a majority of the shares represented thereat.

AMENDED: 6/19/80

SECTION 4. NOTICE OF MEETING. Unless otherwise provided by the laws of the
United States or the Articles of Association, written notice stating the place,
date and hour of the meeting and, in case of a special meeting, the purpose or
purposes for which the meeting is called, shall be delivered not less than ten
or more than fifty days before the date of the meeting, by or at the direction
of the Chairman of the Executive Committee, the Chairman of the Board, the
President, or the Secretary, to each shareholder of record entitled to vote at
such meeting. Such notice shall be deemed to be delivered when deposited in the
United States mail, addressed to the shareholder at his address as it appears on
the stock record book of the Association, with postage thereon prepaid.

SECTION 5. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE. For the purpose
of determining shareholders entitled to notice of or to vote at any meeting of
shareholders or any adjournment thereof, or shareholders entitled to receive
payment of any dividend, or in order to make a determination of shareholders for
any other proper purpose, the Board of Directors of the Association may provide
that the stock transfer books shall be closed for stated period but not to
exceed, in any case, fifty days. If the stock transfer books shall be closed for
the purpose of determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for at least ten days
immediately preceding such

<PAGE>

meeting. In lieu of closing the stock transfer books, the Board of Directors
may fix in advance a date as the record date for any such determination of
shareholders, such date in any case to be not more than fifty days and, in
case of a meeting of shareholders, not less than ten days prior to the date
on which the particular action, requiring such determination of shareholders,
is to be taken. If the stock transfer books are not closed and no record date
is fixed for the determination of shareholders entitled to notice of or to
vote at a meeting of shareholders, or shareholders entitled to receive
payment of a dividend, the close of business on the date on which notice of
the meeting is mailed or on the date on which the resolution of the Board of
Directors declaring such dividend is adopted, as the case may be, shall be
the record date for such determination of shareholders. When a determination
of shareholders entitled to vote at any meeting of shareholders has been made
as provided in this Section, such determination shall be applied to any
adjournment thereof except where the determination has been made through the
closing of the stock transfer books and the stated period of closing has
expired.

AMENDED: 6/19/80

SECTION 6. VOTING LISTS. The Secretary shall make, at least ten days before
each meeting of shareholders, a complete list of the shareholders entitled to
vote at such meeting, or any adjournment thereof, arranged in alphabetical
order, with the address of and the number of shares held by each, which list,
for a period of ten days prior to such meeting, shall be kept on file at the
office of the Association and shall be subject to inspection by any
shareholder at any time during usual business hours. Such list shall also be
produced and kept open at the time and place of the meeting and shall be
subject to the inspection of any shareholder during the whole time of the
meeting. The original stock transfer books shall be prima facie evidence as
to who are the shareholders entitled to examine such list or transfer books
or to vote at any meeting of shareholders. Failure to comply with the
requirements of this Section shall not affect the validity of any action
taken at such meeting.

SECTION 7. QUORUM. Except as otherwise provided by law, a majority of the
outstanding shares of the Association entitled to vote, represented in person
or by proxy, shall constitute a quorum at a meeting of shareholders, and a
majority of votes cast at any meeting at which a quorum is present shall be
decisive of any motion or election. Though less than a quorum of the
outstanding shares are represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without further notice.
At such adjourned meeting at which a quorum shall be present or represented,
any business may be transacted which might have been transacted at the
meeting as originally notified.

AMENDED: 6/19/80

SECTION 8. PROXIES. At all meetings of shareholders, a shareholder entitled
to vote may vote in person or by proxy appointed in writing by the
shareholder or by his duly authorized attorney in fact. Such proxy shall be
filed with the Secretary of the Association before or at the time of the
meeting. Unless otherwise provided in the proxy, a proxy may be revoked at
any time before it is voted, either by written notice filed with the
secretary of the meeting or by oral notice given by the shareholder to the
presiding officer during the meeting. No proxy shall be valid after eleven
months from the date of its execution, unless otherwise provided in the proxy.

SECTION 9. VOTING OF SHARES. Each outstanding share entitled to vote shall be
entitled to one vote upon each matter submitted to a vote at a meeting of
shareholders, except for the election of Directors. In all elections of
Directors each shareholder shall have the right to vote the number of shares
owned by him for as many persons as there are Directors to be elected, or to
cumulate such shares and give one

<PAGE>

candidate as many votes as the number of Directors multiplied by the number
of his shares shall equal or to distribute them on the same principle among
as many candidates as he shall elect.

SECTION 10. VOTING OF SHARES BY CERTAIN HOLDERS.

AMENDED: 6/19/80

(a) OTHER CORPORATION. Shares standing in the name of another corporation
may be voted either in person or by proxy, by the president of such
corporation, or any other officer appointed by such president. A proxy
executed by any principal officer of such other corporation or assistant
thereto shall be conclusive evidence of the signer's authority to act, in the
absence of express notice to this Association, given in writing to the
Secretary of the designation of some other person by the Board of Directors
or the by-laws of such other corporation.

AMENDED: 6/19/80

(b) LEGAL REPRESENTATIVES AND FIDUCIARIES. Shares held by an administrator,
executor, guardian, conservator, trustee in bankruptcy, receiver, or assignee
for creditors may be voted by him, either in person or by proxy, without a
transfer of such shares into his name, provided that there is filed with the
Secretary before or at the time of the meeting proper evidence of his incumbency
and the number of shares held. Shares standing in the name of a fiduciary may be
voted by him, either in person or by proxy. A proxy executed by a fiduciary
shall be conclusive evidence of the signer's authority to act, in the absence of
express notice to this Association, that such manner of voting is expressly
prohibited or otherwise directed by the document creating the fiduciary
relationship.

(c) PLEDGES. A shareholder whose shares are pledges shall be entitled to vote
such shares until the shares have been transferred into the name of the pledgee,
and thereafter the pledgee shall be entitled to vote the shares so transferred.

(d) TREASURY STOCK AND SUBSIDIARIES. Neither treasury shares, nor shares held
by another corporation if majority of the shares entitled to vote for the
election of directors of such other corporation is held by this Association,
shall be voted at any meeting or counted in determining the total number of
outstanding shares entitled to vote, but shares of its own issue held by such
other corporation in a fiduciary capacity, may be voted and shall be counted in
determining the total number of outstanding shares entitled to vote.

AMENDED: 6/19/80

(e) MINORS. Shares held by a minor may be voted by such minor in person or
proxy and no such vote shall be subject to disaffirmance or avoidance, unless
prior to such vote the Secretary of the Association has received written notice
or has actual knowledge that such shareholder is a minor.

<PAGE>

AMENDED: 6/19/80

(f) INCOMPETENTS AND SPENDTHRIFTS. Shares held by an incompetent or spendthrift
may be voted by such incompetent or spendthrift in person or by proxy and no
such vote shall be subject to disaffirmance or avoidance, unless prior to such
vote the Secretary of the Association has actual knowledge that such shareholder
has been adjudicated an incompetent or spendthrift or actual knowledge of filing
of judicial proceedings for appointment of a guardian.

AMENDED: 6/19/80

(g) JOINT TENANTS. Shares registered in the names of two or more individuals
who are named in the registration as joint tenants may be voted in person or by
proxy signed by any one or more of such individuals if either (i) no other such
individual or his legal representative is present and claims the right to
participate in the voting of such shares or prior to the vote files with the
Secretary of the Association a contrary written voting authorization or
direction or written denial of authority of the individual present or signing
the proxy proposed to be voted or (ii) all such other individuals are deceased
and the Secretary of the Association has no actual knowledge that the survivor
has been adjudicated not to be the successor to the interests of those deceased.

SECTION 11. WAIVER OF NOTICE OF SHAREHOLDERS. Whenever any notice whatever is
required to be given to any shareholder of the Association under the Article
of Association or By-laws or any provision of law, a waiver thereof in
writing, signed at any time, whether before or after the time of meeting, by
the shareholder entitled to such notice, shall be deemed equivalent to the
giving of such notice; provided that such waiver in respect to any matter of
which notice is required under any provision of law shall contain the same
information as would have been required to be included in such notice, except
such waiver need not set forth the time and place of meeting.

SECTION 12. CHAIRMAN AND SECRETARY OF MEETING. At each meeting of the
shareholders, the shareholders shall elect a Chairman and a Secretary of the
meeting, each of whom shall be either an officer or a shareholder of the
Association.

AMENDED: 6/19/80

SECTION 13. JUDGES OF ELECTIONS. Not less than thirty days prior to the date of
any election of Directors the Board of Directors shall appoint two shareholders
to be the judges of said election has been held the judges shall certify the
results thereof to the Secretary.

AMENDED: 6/19/80

SECTION 14. REPORTS OF MEETINGS. The Secretary of the meeting shall cause the
record of each meeting of shareholders to be kept showing the names of the
shareholders present in person and by proxy, the number of shares held by each
and the number of shares voted on each action. After each such meeting the
Secretary shall forward a report thereof to the Comptroller of the Currency in
the form prescribed by him.

<PAGE>

ARTICLE II

BOARD OF DIRECTORS

SECTION 1. GENERAL POWERS. The business and affairs of the Association shall be
managed by its Board of Directors.

AMENDED: 10/19/67; 6/19/80; 1/21/82

SECTION 2. NUMBER, TENURE AND QUALIFICATIONS. The Board of Directors shall
consist of not less than five nor more than twenty-five persons. The number of
Directors to be elected shall be determined by a majority of the votes cast by
the shareholders at the annual meeting or at a special meeting called for such
purpose; provided that the Board of Directors may, by a vote of the majority of
its members, increase the number of members of the Board as established by the
shareholders by not more than two members. Each Director shall hold office until
the next annual meeting of shareholders and until his successor shall have been
elected, or until his death or until he shall resign by filing his written
resignation with the Secretary. No person shall be eligible to be elected or
re-elected as a member of the Board of Directors if he shall have attained 70
years of age at the date of his election.

SECTION 3. OATH. Each person when initially elected or appointed a member of the
Board of Directors shall take the oath of such office in the form prescribed by
the Comptroller of the Currency. No person elected or appointed a Director shall
exercise the functions of such office until he shall have taken such oath.

SECTION 4. REGULAR MEETINGS. A regular meeting of the Board of Directors shall
be held, without other notice than this By-law, immediately after and at the
same place as the annual meeting of shareholders for the purpose of the
Directors taking their oaths, organizing the Board, electing the Executive
Committee, appointing officers of the Association and transacting such other
business as may properly come before the meeting. Additional regular meetings of
the Board of Directors shall be held monthly on such day and at such hour as the
Board of Directors may provide by resolution, without other notice than such
resolutions. When any regular meeting of the Board of Directors falls upon a
holiday, the meeting shall be held on the next business day unless the Board of
Directors shall have previously designated another day.

AMENDED: 6/19/80

SECTION 5. SPECIAL MEETINGS. Special meetings of the Board of Directors may be
called by or at the request of the Chairman of the Executive Committee, Chairman
of the Board, the President, the Executive Vice President, and shall be called
by the Secretary at the request of three or more Directors.

SECTION 6. PLACE OF MEETING. The Board of Directors (or in the case of a
special meeting called at the request of the Chairman of the Executive
Committee, the Chairman of the Board, the President, the Executive Vice
President, or three or more Directors calling such meeting, the officer of
Directors requesting such call) may designate any convenient place in the
City of Milwaukee, Wisconsin, as the

<PAGE>

place of meeting for any meeting of the Board of Directors. If no such
designation is made, the place of meeting shall be the main banking office of
the Association in the City of Milwaukee, Wisconsin.

AMENDED: 6/19/80

SECTION 7. NOTICE. Notice of any special meeting shall be given by the
Secretary to each Director at least 48 hours previous thereto by orally
presenting such notice to a Director personally, directly or by telephone, or
by written notice delivered personally or mailed to a Director at his
business address, or by telegram. If mailed, such notice shall be deemed to
be delivered when deposited in the United States mail so addressed with
postage thereon prepaid (air mail postage as to any Director whose address is
more than 200 airline miles from Milwaukee, Wisconsin). If notice is given by
telegram, such notice shall be deemed to be delivered when the telegram is
delivered to the telegraph company. Whenever any notice whatever is required
to be given to any Director under the provisions of these By-laws or under
the provisions of the Articles of Association or under the provisions of any
statute, a waiver thereof in writing, signed at any time, whether before or
after the time of meeting, by the director entitled to such notice, shall be
deemed equivalent to the giving of such notice. The attendance of a Director
at a meeting shall constitute a waiver of notice of such meeting, except
where a Director attends a meeting is not lawfully called or convened.
Neither the business to be transacted at, nor the purpose of, any regular or
special meeting of the Board of Directors need be specified in the notice or
waiver of notice of such meeting.

SECTION 8. QUORUM. A majority of the members of the Board of Directors shall
constitute a quorum for the transaction of business at any meeting of the
Board of Directors, but a majority of the Directors present (though less than
such quorum) may adjourn the meeting from time to time without further notice.

SECTION 9. MANNER OF ACTING. The act of the majority of the Directors present
at a meeting at which a quorum is present shall be the act of the Board of
Directors, unless the act of greater number is required by law or by the
Articles of Association or these By-laws.

SECTION 10. VACANCIES. Any vacancy occurring in the Board of Directors by
resignation or death or by reason of the increase in the number of authorized
members of the Board as provided at Section 2 of this Article II may be filled
until the next succeeding annual election by appointment pursuant to the
affirmative vote of a majority of the Directors then in office.

AMENDED: 6/19/80

SECTION 11. PRESUMPTION OF ASSENT. A Director of the Association who is present
at a meeting of the Board of Directors or a committee thereof at which action on
any corporate matter is taken shall be presumed to have assented to the action
taken unless his dissent shall be entered in the minutes of the meeting or
unless he shall file his written dissent to such action with the person acting
as Secretary of the meeting before the adjournment thereof or shall file his
written dissent by registered mail to the Secretary immediately after the
adjournment of the meeting. Such right to dissent shall not apply to a Director
who voted in favor of such action.

<PAGE>

ARTICLE III

COMMITTEES

AMENDED: 2/19/87

SECTION 1. EXECUTIVE COMMITTEE. The Board of Directors shall, at its regular
meeting held immediately following the annual meeting of shareholders, elect
an Executive Committee consisting of such number of members of the Board, not
less than six nor more than fifteen, as the Board may fix by resolution. The
Chairman of the Board and President shall be members of the Executive
Committee. The Board of Directors shall also elect six or more of its members
to serve as alternate members of the Executive Committee, which alternate
members may be called upon by the Chairman of the Executive Committee to
serve in the absence of any of the regular members. Any vacancy occurring in
the Executive Committee may be filled until the next succeeding annual
election by appointment of the Board of Directors.

The Executive Committee shall be vested with all the authority of the Board
of Directors and, subject to the control of the Board, shall direct the
management of the affairs of the Association in the interim between meetings
of the Board. The Executive Committee may require that it shall approve all
loans and discounts to any individual or entity which equal or exceed such
aggregate amount as the Executive Committee shall keep minutes of all of its
meetings, showing the matters considered and disposed of by it, which minutes
shall be presented to the Board of Directors at its next succeeding regular
meeting.

The Executive Committee shall elect one of its members as Chairman of the
Executive Committee who may, but need not be, the Chairman of the Board of
Directors and/or the President. Such election shall be made annually at the
first meeting of the Executive Committee held after each annual meeting of
the shareholders. The Chairman of the Executive Committee shall hold office
until his successor shall have been duly elected and shall have qualified or
until his death, resignation or removal in the manner hereinafter provided.
The Chairman of the Executive Committee shall appoint a Secretary who need
not be a member of the Executive Committee.

AMENDED: 2/15/79; 7/19/79; 2/19/80; 9/18/80; 11/18/82; 2/19/87; 8/19/93

SECTION 2. RISK EXAMINATION COMMITTEE. The Board of Directors shall, at its
regular meeting held immediately following the annual meeting of
shareholders, elect a Risk Examination Committee consisting of not less than
three members of the Board, none of whom may be officers of the Association,
except where the full Board of Directors comprises the Risk Examination
Committee. The Board of Directors may also elect one or more of its members
to serve as an alternate member or members of the Risk Examination Committee,
which alternate member or members may be called upon by the Chairman of the
Risk Examination Committee to serve in the absence of any of the regular
members.

The Board of Directors shall appoint the Chairman of the Risk Examination
Committee, who shall be a member of such Committee, and a Secretary, who need
not be a member of such Committee.

The Risk Examination Committee shall cause suitable examinations of the
affairs of the Association to be made by auditors responsible only to the
Board of Directors, in order to ascertain whether the Association is in sound
financial condition, and whether adequate internal audit controls and
procedures are

<PAGE>

maintained. The Risk Examination Committee shall also review activities that
represent significant potential loss of income or assets of the Association.
The Risk Examination Committee shall, in addition, cause suitable
examinations of the Trust Department to be made by such independent auditors
at least once during each calendar year and within fifteen months of the last
such audit for the purpose of determining whether the Trust Department has
been administered according to law, the regulations of any governmental
regulatory agency and sound fiduciary principles. The results of each such
examination, together with the results of any examination made by the
examining staff of any governmental regulatory agency, shall be reviewed by
the Risk Examination Committee and reported to the Board of Directors,
together with any recommended changes in the manner of conducting the affairs
of the Association as shall be deemed advisable, and made a part of the
records of the Association.

<PAGE>

AMENDED: 9/18/80; 2/19/87

SECTION 3. TRUST INVESTMENT COMMITTEE. The Board of Directors shall, at its
regular meeting held immediately following the annual meeting of shareholders,
elect a Trust Investment Committee, consisting of such number of members of the
Board, not less than three nor more than fifteen, as the Board may fix by
resolution. The Board of Directors shall also elect six or more of its members
to serve as alternate members of the Trust Investment Committee, which alternate
members may be called upon by the Chairman of the Board to serve in the absence
of any of the regular members.

The Trust Investment Committee shall appoint a Chairman who shall be a member of
such Committee, and a Secretary, who need not be a member of such Committee.

All investments of trust funds shall be made, retained or disposed of only with
the authorization or approval of the Trust Investment Committee. The Trust
Investment Committee shall, at least annually, review each trust account to
determine the safety and value of its assets and advisability of retaining or
disposing of them. The Trust Investment Committee shall keep minutes of all of
its meetings, showing the disposition of all matters considered and passed on by
it, which minutes shall be presented to the Executive Committee at its next
succeeding regular meeting.

AMENDED: 11/15/73

SECTION 4. OFFICERS' LOAN COMMITTEES. The Executive Committee or the Board of
Directors may appoint such Officers' Loan Committees as it deems appropriate
from time to time, each such Committee shall consist of such number of officers
of the Association as the Executive Committee or the Board of Directors shall
determine by resolution. The Executive Committee or the Board of Directors may
also appoint one or more officers of the Association to serve as alternate
members of such Committees, which alternate members may be called upon by the
Chairman of the Board, President or the Chairman of the respective Committee to
serve in the absence of any of the regular members. The Executive Committee or
the Board of Directors shall designate the person who shall serve as Chairman of
each such Committee and each Committee shall appoint a Secretary who need not be
a member of the Committee.

Each such Officers' Loan Committee shall have such powers to discount and
purchase bills, notes and other evidences of debt, to buy and sell bills of
exchange, to examine and approve loans and discounts held by the Association as
the Executive Committee or the Board of Directors may from time to time specify
by resolution, subject at all times to the control of the Executive Committee
and the Board of Directors. Such Committees shall report their actions to each
regular meeting of the Executive Committee or Board of Directors, which shall
approve or disapprove the report and record such action in the minutes of their
meetings, but no such disapproval shall adversely affect the interests of any
customer or third party in any transaction or commitment made under the
authority of this Section.

ADDED: 11/15/73; 1/20/83

SECTION 5. OTHER COMMITTEES. The Board of Directors or Executive Committee by
resolution may designate one or more additional committees, each committee to
consist of such number of officers and/or directors of the Association as may be
specified in such resolution, provided, however, that a Plan Committee for any
pension plan established by the Association may consist of such officers,
directors,

<PAGE>

and/or employees of the Association as may be designated by the Board. Each
such committee shall have such powers in the management of the business and
affairs of the Association to the extent provided in said resolution as
initially adopted, and as thereafter supplemented or amended by further
resolution adopted by the Executive Committee or Board of Directors, except
action in respect to matters requiring action by the shareholders, Board of
Directors, Executive Committee or other committee established by or pursuant
to these By-laws. The Executive Committee or Board of Directors may specify
one or more alternate member of any such committee who may take the place of
any absent members or members at any meeting of such committee, upon request
by the Chairman of the Board, President or upon request by the chairman of
such committee. Each such committee shall fix its own rules governing the
conduct of its activities and shall report their actions to each regular
meeting of the Executive Committee or Board of Directors, which shall approve
or disapprove the report and record such action in the minutes of their
meetings.

ARTICLE IV

OFFICERS

AMENDED: 2/16/78; 6/19/80; 9/15/88; 3/18/93

SECTION 1. NUMBER AND QUALIFICATIONS. The principal officers of the Association
shall be a Chairman of the Board of Directors, a President, one or more
Executive, Senior and First Vice Presidents, a Cashier, a Trust Officer, a
Comptroller, and a Secretary, each of whom shall be appointed by the Board of
Directors. Such other officers, including Vice Presidents, and assistant
officers as may be deemed necessary may be appointed by the Board of Directors.
Any two or more offices may be held by the same person, except the offices of
President and Cashier, the offices of President and Secretary, and the offices
of President and Vice President. The Chairman of the Board of Directors and
President shall be members of the Board of Directors. Except to the extent such
power is limited by the Board of Directors, any officer authorized by these
By-laws or the Board of Directors to appoint officers may appoint one or more
other officers or assistant officers, and any officer making such an appointment
shall report the appointment to the Board of Directors at its next regular
meeting.

SECTION 2. TERMS OF OFFICE. The officers of the Association shall be appointed
annually by the Board of Directors at the first meeting of the Board of
Directors held after each annual meeting of the shareholders. If officers shall
not be appointed at such meeting, they shall be appointed as soon thereafter as
conveniently may be. Each officer shall hold office until his successor shall
have been duly appointed and shall have qualified or until his death or until he
shall resign or shall have been removed in the manner hereinafter provided.

SECTION 3. REMOVAL. Any officer or agent appointed by the Board of Directors or
Executive Committee may be removed by the Board of Directors or Executive
Committee, as the case may be, whenever in its judgment the best interests of
the Association will be served thereby, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Appointment
shall not of itself create contract rights.

<PAGE>

SECTION 4. VACANCIES. A vacancy in any principal office because of death,
resignation, removal, disqualification or otherwise shall be filled by the Board
of Directors for the unexpired portion of the term.

AMENDED: 3/18/93

SECTION 5. PRINCIPAL EXECUTIVE OFFICER. The principal executive officer of the
Association shall be either the Chairman of the Board or the President of the
Association, as is designated from time to time by the Board of Directors by
resolution duly adopted by a majority of its members at any regular or Special
Meeting. Subject to the control of the Board of Directors such principal
executive officer shall generally supervise and control all of the business and
affairs of the Association. The principal executive officer shall have
authority, subject to such rules as may be prescribed by the Board of Directors,
to appoint such agents, employees and, in accordance with Section 1 of this
Article, other officers of the Association as he or she shall deem necessary, to
prescribe their powers, duties and compensation, and to delegate authority to
them. Such agents, employees and officers shall hold office at the discretion of
the principal executive officer.

AMENDED: 1/16/69; 2/18/82

SECTION 6. CHAIRMAN OF THE BOARD. The Chairman of the Board shall, when present,
preside at all meetings of the shareholders and the Board of Directors. The
Chairman of the Board shall perform all such duties as may be prescribed by the
Board of Directors from time to time.

AMENDED: 1/16/69; 6/19/80; 2/18/82

SECTION 7. PRESIDENT. The President shall perform all duties incident to the
office of President and such other duties as may be prescribed by the Board of
Directors from time to time. Unless the Board of Directors otherwise provides,
in the absence of the Chairman of the Board or in the event of his inability or
refusal to act, the President shall perform the duties of the Chairman of the
Board, and when so acting shall have all the powers of and be subject to all the
restrictions upon the Chairman of the Board. He may sign with the Cashier,
Secretary, Assistant Cashier or Assistant Secretary, or any other proper officer
of the Association thereunto authorized by the Board of Directors certificates
for shares of the Association.

AMENDED: 2/16/78

SECTION 8. EXECUTIVE VICE PRESIDENT(S). The Executive Vice President(s) shall
consult with the Chairman of the Board and the President regarding the business
and affairs of the Association and shall perform such duties as may be
prescribed by the Chairman of the Board, the President and the Board of
Directors from time to time. In the absence of the President, or in the event of
his inability or refusal to act, the Board of Directors may designate one
Executive Vice President to perform the duties of President and when so acting
said Executive Vice President shall have all of powers of and be subject to all
of the restrictions upon the President.

SECTION 9. THE VICE PRESIDENTS. In the absence of the Chairman of the Board, the
President and the Executive Vice President, or in the event of their inability
or refusal to act, the Vice President (or in the event there be more than one
Vice President, the Vice Presidents in the order designated by resolution of

<PAGE>

the Board of Directors, or in the absence of any designation, then in the
order of their appointment) shall perform the duties of the Chairman of the
Board and the President (except for presiding at meetings of the
shareholders, of the Board of Directors and of the Executive Committee), and
when so acting shall have all the powers of and be subject to all the
restrictions upon the Chairman of the Board and/or President. Any Vice
President may sign, with the Cashier, certificates for shares of the
Association; and shall perform such other duties as from time to time may be
assigned to him by the Chairman of the Executive Committee, the Chairman of
the Board, the President, or by the Board of Directors.

AMENDED: 6/19/80

SECTION 10. THE CASHIER. The Cashier and the Secretary, or either of them, shall
(a) be custodians of the corporate records and of the seal of the Association
and see that the seal of the Association is affixed to all documents the
execution of which on behalf of the Association under its seal is duly
authorized; and (b) sign with the President, or a Vice President, certificates
for shares of the Association, the issuance of which shall have been authorized
by resolution of the Board of Directors. The Cashier shall have and may exercise
any and all other powers and duties pertaining by law, regulation or practice,
to the officer of Cashier or imposed by these By-laws and shall perform such
other duties as from time to time may be assigned to him by the Chairman of the
Board, the President or by the Board of Directors.

SECTION 11. COMPTROLLER. The Comptroller shall be responsible for the accuracy
and proper maintenance of all accounting records of the Association in
accordance with generally recognized principles of accounting acceptable to the
Board of Directors. He shall prepare and furnish to the Board periodic reports
showing the financial condition and results of operations of the Association,
together with such other information as he may be called upon from time to time
to furnish. The Comptroller shall also perform such other duties as may be
assigned to him directly or indirectly, by the Chairman of the Board, the
President or the Board of Directors. The Comptroller shall be responsible to the
Board of Directors of the Association and shall report to the Board directly or
through the Chairman of the Board.

ADDED: 6/19/80

SECTION 12. THE SECRETARY. The Secretary of the Association shall: (a) keep the
minutes of the shareholders' and of the Board of Directors' meetings in one or
more books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these By-laws or as required by law; (c)
advise all members of the Board of Directors immediately upon their election as
such; (d) along with the Cashier, or either of them, be custodians of the
corporate records and of the seal of the Association and see that the seal of
the Association is affixed to all documents the execution of which on behalf of
the Association under its seal is duly authorized; (e) keep a register of the
post office address of each shareholder; (f) sign with the President, or a Vice
President, certificates for shares of the Association, the issuance of which
shall have been authorized by resolution of the Board of Directors, as duties of
the Cashier. The Secretary shall perform such other duties as from time to time
may be assigned to him by the Chairman of the Board, the President or by the
Board of Directors.

RENUMBERED: 6/19/80

SECTION 13. ASSISTANTS AND ACTING OFFICERS. The Board of Directors shall have
the power to appoint any person to act as assistant to any officer, or to
perform the duties of such officer whenever for any reason it is impracticable
for such officer to act personally, and such assistant or acting officer so
appointed by

<PAGE>

the Board of Directors shall have the power to perform all the duties of the
office to which he is so appointed to be assistant, or as to which he is so
appointed to act, except as to such power may be otherwise defined or
restricted by the Board of Directors.

ARTICLE V

CERTIFICATES FOR SHARES AND THEIR TRANSFER

AMENDED: 6/19/80

SECTION 1. CERTIFICATES FOR SHARES. Certificates representing shares of the
Association shall be in such form as shall be determined by the Board of
Directors. Such certificates shall be signed by the President or Vice President
and by the Cashier, Assistant Cashier, Secretary or Assistant Secretary. All
certificates for shares shall be consecutively numbered or otherwise identified.
The name and address of the person to whom the shares represented thereby are
issued, with the number of shares and the date of issue, shall be entered on the
stock transfer books of the Association. All certificates surrendered to the
Association for transfer shall be cancelled and no new certificate shall be
issued until the former certificate for a like number of shares shall have been
surrendered and cancelled, except that in case of a lost, destroyed or mutilated
certificate a new one may be issued therefor upon such terms and indemnity to
the Association as the Board of Directors may prescribe.

AMENDED: 6/19/80

SECTION 2. FACSIMILE SIGNATURES AND SEAL. The Seal of the Association on any
certificates for shares may be a facsimile. The signatures of the President or
Vice President, the Cashier or Assistant Cashier and the Secretary or Assistant
Secretary upon a certificate may be facsimiles if the certificate is
countersigned by a transfer agent, or registered by a registrar, other than the
Association itself or an employee of the Association.

AMENDED: 6/19/80

SECTION 3. SIGNATURE BY FORMER OFFICERS. In case any officer, who has signed or
whose facsimile signature has been placed upon any certificate for shares, shall
have ceased to be such officer before such certificate is issued, it may be
issued by the Association with the same effect as if he were such officer at the
date of its issue.

SECTION 4. TRANSFER OF SHARES. Prior to due presentment of a certificate for
shares for registration or transfer the Association may treat the registered
owner of such shares as the person exclusively entitled to vote, to receive
notifications and otherwise to exercise all the rights and powers of an owner.
Where a certificate for shares is presented to the Association with a request to
register for transfer, the Association had no duty to inquire into adverse
claims or has discharged any such duty. The Association may require reasonable
assurance that said endorsements are genuine, effective and in compliance with
such other regulations as may be prescribed under the authority of the Board of
Directors.

<PAGE>

SECTION 5. STOCK REGULATIONS. The Board of Directors shall have the power and
authority to make all such further rules and regulations not inconsistent with
law as it may deem expedient concerning the issue, transfer and registration of
certificates representing shares of the Association.

ARTICLE VI

CONTRACTS

AMENDED: 3/18/76

The Board of Directors may authorize any officer or officers, agent or
agents, to enter into any contract, execute and deliver any instrument in the
name of and on behalf of the Association, execute checks, drafts, bills of
exchange, orders, letters of credit and other obligations of the Association,
transmit and receive funds of the Association, direct the transfer of such
funds by others and enter into agreements which authorize others, on terms
and conditions set forth therein, to transmit, receive and direct transfer of
such funds by telegraphic, telephonic, electronic or other means, and such
authorization may be general or confined to specific instances.

<PAGE>

ARTICLE VII

AMENDMENTS

These By-laws may be altered, amended or repealed and new By-laws may be adopted
by the shareholders or Board of Directors by majority vote at any regular
meeting or special meeting noticed for such purpose. Any By-law adopted by the
Board of Directors shall be subject to amendment or repeal by the shareholders
as well as by the Directors.

ARTICLE VIII

CORPORATE SEAL

The Board of Directors shall provide a corporate seal which shall be circular in
form and shall have inscribed thereon the name of the Association and the words
"Corporate Seal."

ARTICLE IX

INDEMNIFICATION OF DIRECTORS AND OFFICERS

SECTION 1. DEFINITIONS OF TERMS FOR THIS ARTICLE.

(a) "Director or Officer" shall include any person who may have served at
the request of the Association as a director or officer of another
corporation in which the Association owned stock or was a creditor at any
time during the period of said service, and all past, present and future
directors and officers of the Association whether or not so serving at the
time of incurring the expenses or liabilities referred to herein, and their
personal representatives.

(b) "Expenses" shall include, without limiting the generality thereof,
amounts paid or payable as fees of legal counsel and experts.

(c) "Action" means any civil, criminal or administrative action, suit,
proceeding or claim, or threat thereof, in which a director or officer may be
involved as a party or otherwise, by reason of his having served as such
director or officer or by reason of anything done or omitted by him as such
director or officer, or alleged to have been so done or omitted.

<PAGE>

(d) "Determination by the Board of Directors" means a determination made by
resolution, upon favorable advice by counsel for the Association, adopted by
the affirmative vote of a majority of a committee consisting of all directors
of the Association then in office, other than those involved in the action,
provided that there are not less than three, such determination shall be
deemed to have been made if recommended by affirmative vote of a majority of
the directors of the Association then in office (whether or not involved in
the action) but only to the extent concurred in by either (i) the affirmative
vote of a majority of the outstanding shares entitled to vote at a meeting of
the shareholders called for that purpose, or (ii) the opinion of independent
legal counsel selected by the Board of Directors.

SECTION 2. MANDATORY INDEMNIFICATION. The Association shall indemnify each
director or officer against all expenses actually and reasonably incurred by
him in connection with any action and against all liability to which he is
subjected upon disposition of any action, if either (a) final disposition of
such action is made in favor of such director or officer or (b) he is
adjudged to be not guilty of gross negligence or misconduct in the
performance of duty to the Association in the matter.

SECTION 3. ASSUMPTION OF DEFENSE AND LIABILITY. If any director or officer,
who is involved in any action for which mandatory indemnification might be
required under Section 1 in the event of favorable adjudication thereof,
shall make full disclosure to the Board of Directors of or to counsel for the
Association of the pertinent facts not otherwise known to the Association,
and if there shall be made a determination by the Board of Directors that in
its opinion such director or officer was not guilty of negligence or
misconduct in the performance of duty to the Association in the matter, the
Association shall assume or provide at the Association's expense and risk the
defense or settlement thereof on his behalf; and in such event such director
or officer shall have no liability to the Association for any expense,
liability or settlement payment incurred by the Association in the matter.

SECTION 4. INSURANCE. The Association may upon affirmative vote of a majority of
its Board of Directors, purchase commercial insurance for the benefit of a
director or officer against all or any part of the expenses of actions against
such director or officer; and such insurance need not exclude actions in which
such director or officer may thereafter be adjudged guilty of negligence or
misconduct in the performance of duty to the Association. Such insurance may,
but need not, be for the benefit of all directors or officers.

SECTION 5. FURTHER ASSUMPTION OR SHARING OF EXPENSE AND LIABILITY. If complete
indemnification of expense, liability or settlement payments is not provided
pursuant to Sections 2, 3 and 4 to any director or officer, the Association may
grant such further indemnification in whole or in part as may be fixed by
determination by the Board of Directors upon consideration of the circumstances
of the individual action.

SECTION 6. LIABILITY FOR DETERMINATION. The Association and its directors,
officers, employees and agents shall not be liable to anyone for making any
determination as to the existence or absence of liability under any of Section 2
through 5 above, or for making or refusing to make any payment thereunder on the
basis of such determination, or for taking or omitting to take any other action
thereunder in reliance upon advice of counsel.

SECTION 7. OTHER RIGHTS. The foregoing indemnification provisions shall be in
addition, and may be claimed without prejudice, to any other rights which any
director, officer, employee or agent may have.

<PAGE>

ARTICLE X

EMERGENCY PROVISIONS

SECTION 1. APPLICABILITY. The provisions of this Article shall be of no effect
until the occurrence of a state of emergency resulting in this Association being
unable to continue its normal functions under the direction of established
management and at the location of its main office (in this Article referred to
as "Emergency"), which Emergency may include but shall not be limited to war or
war-like disaster. Upon such occurrence and during the continuation of such
Emergency:

(a) the provisions of this Article shall become effective forthwith and
shall remain so effective without further authorization or declaration,
unless otherwise determined by the Board of Directors or other body
performing the powers of the Board of Directors as provided in these By-laws
or under any governmental directives, and

(b) so far as the provisions of this Article are in conflict with the
provisions of any other By-law or resolution theretofore adopted, the
provisions of this Article shall prevail.

SECTION 2. TEMPORARY OFFICES. Upon the occurrence and during the continuation of
such an Emergency of sufficient severity so as to prevent this Association from
carrying on its normal banking functions at the location of its main office, any
or all of the business ordinarily conducted at such location shall be
temporarily relocated elsewhere in suitable quarters, which may be or include
but need not be limited to an established branch office of this Association, as
may be designated by the Board of Directors or other body performing the powers
of the Board of Directors as provided in these By-laws or under any governmental
directives. Such relocated place of business shall be within the City of
Milwaukee if a suitable location within such City is available. Any temporary
relocated place of business shall be returned to its original or other legally
authorized location as soon as practicable and such temporary place of business
shall then be discontinued.

SECTION 3. EMERGENCY EXECUTIVE COMMITTEE. Upon the occurrence and during the
continuance of such an Emergency of sufficient severity so as to prevent the
conduct and management of the affairs and business of this Association by its
Board of Directors and the regularly established committees thereof:

(a) There is hereby created an Emergency Executive Committee, which may
exercise the full powers and authority of the Board of Directors and of any
other regularly established Committee of the Board of Directors until the Board
of Directors or other such established committee may be available to resume
exercise of its functions.

<PAGE>

(b) Such Emergency Executive Committee shall consist of the then available
members of the Board of Directors, any three of whom shall constitute a
quorum. Whenever less than three regularly elected directors of this
Association shall be available to serve on such Emergency Executive
Committee, the place of any absent director may be taken by any person,
designated by prior resolution of the Board of Directors of First Wisconsin
Bankshares Corporation (as holder of more than 98% of the outstanding shares
of this Association), to serve as an acting director and member of the
Emergency Executive Committee until not less than three regularly elected
directors of this Association are available to serve.

(c) The Emergency Executive Committee may meet upon such notice and at such
times and places, as the person performing the powers and duties of President
may determine to be practicable under Emergency conditions. Approval by any
member of any matter or action, given by written, telegraphic or telephone
consent, shall have the same effect as a vote taken at a meeting.

AMENDED: 6/19/80

SECTION 4. EMERGENCY OFFICER SUCCESSION. If during any Emergency, neither the
Chairman of the Board, nor the President, nor the Executive Vice President of
this Association can be located by the then acting main office or is unable
to assume or to continue normal executive duties, then the authority and
duties of such officer shall without further action of the Board of
Directors, be automatically assumed temporarily by the Senior Vice Presidents
of the Bank and such monthly amounts of Pension Plan Benefits shall be
calculated according to the applicable method of payment as provided under
the Pension Plan, including any such method or payment option validly elected
by the Eligible Employee or his Beneficiary thereunder.

<PAGE>

EXHIBIT 5

CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321(b)
OF THE TRUST INDENTURE ACT OF 1939

Firstar Bank Milwaukee, N.A., National Association, as Trustee herein named,
hereby consents that reports of examination of said Trustee by Federal and
State authorities may be furnished by such authorities to the Securities and
Exchange Commission upon request therefor.

FIRSTAR BANK MILWAUKEE, N.A.,
National Association
(Trustee)

By: /s/ Amy E. Nolde
----------------------------------------
AMY E. NOLDE, TRUST OFFICER
(Name and title)

By: /s/ Pamela Warner
----------------------------------------
PAMELA WARNER, TRUST OFFICER
(Name and title)

Dated: November 23, 1998

<PAGE>

EXHIBIT 6
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Legal Title of Bank: Firstar Bank Milwaukee, N.A. Call Date: 12/31/97 ST-BK: 55-9180 FFIEC 031
Address: 777 East Wisconsin Avenue Page RC-1
City, State Zip: Milwaukee, Wisconsin 53202
FDIC Certificate No.: | 0 | 5 | 3 | 0 | 8 |
</TABLE>

CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR DECEMBER 31, 1997

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
<TABLE>
<CAPTION>

| C400 |
Dollar Amounts in Thousands RCFD Bil Mil Thou
- ----------------------------------------------------------------------------- -----------------------------------
<S> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule RC-A):. . . . | / / / / / / / / / / / / / / |
a. Noninterest-bearing balances and currency and coin (1) . . . . . . . . . . . 0081 690,396 1.a.
b. Interest-bearing balances (2). . . . . . . . . . . . . . . . . . . . . . . . 0071 5,324 1.b.
2. Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | / / / / / / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, Column A):. . . . . . . . . 1754 533,471 2.a.
b. Available-for-sale securities (from Schedule RC-B, Column D) . . . . . . . . 1773 483,764 2.b.
3. Federal funds sold and securities purchased under agreements to resell . . . . 1350 851,589 3.
4. Loans and lease financing receivables:. . . . . . . . . . . . . . . . . . . . . | / / / / / / / / / / / / / / |
a. Loans and leases, net of unearned income . . . . . . . . . . . . . . . . . . | / / / / / / / / / / / / / / |
(from Schedule RC-C) . . . . . . . . . . . . . . . . | RCFD 2122 | 4,605,912 | / / / / / / / / / / / / / / | 4.a.
b. LESS: Allowance for loan and lease losses . . . . . | RCFD 3123 | 71,941 | / / / / / / / / / / / / / / | 4.b.
c. LESS: Allocated transfer risk reserve . . . . . . . | RCFD 3128 | 0 | / / / / / / / / / / / / / / | 4.c
d. Loans and leases, net of unearned income, allowance, and reserve . . . . . . | / / / / / / / / / / / / / / |
(Item 4.a. minus 4.b. and 4.c.) . . . . . . . . . . . . . . . . . . . . . . . . 2125 4,533,971 4.d.
5. Trading assets (from Schedule RC-D) . . . . . . . . . . . . . . . . . . . . . . 3545 9,318 5.
6. Premises and fixed assets (including capitalized leases). . . . . . . . . . . . 2145 131,024 6.
7. Other real estate owned (from Schedule RC-M). . . . . . . . . . . . . . . . . . 2150 1,205 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 7,084 9.
10. Intangible assets (from Schedule RC-M). . . . . . . . . . . . . . . . . . . . . 2143 26,939 10.
11. Other assets (from Schedule RC-F).. . . . . . . . . . . . . . . . . . . . . . . 2160 108,520 11.
12. Total assets (sum of items 1 through 11). . . . . . . . . . . . . . . . . . . . 2170 7,382,605 12.
</TABLE>
___________

(1) Includes cash items in process of collection and unposted debits
(2) Includes time certificates of deposit not held for trading

Dollar Amounts in Thousands RCFD Bil Mil Thou
- ----------------------------------------------------------------------------- -----------------------------------
<S> <C> <C>
LIABILITIES
13. Deposits:. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | / / / / / / / / / / / / / / |
a. In domestic offices (sum of totals of columns A and C from . . . . . . . . . | / / / / / / / / / / / / / / |
Schedule RC-E, part 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . RCON 2200 4,503,091 13.a.
(1) Noninterest-bearing (1) . . . . . . . . . . . .| RCON 6631 | 1,535,600 | / / / / / / / / / / / / / / | 13.a.(1)
(2) Interest-bearing. . . . . . . . . . . . . . . .| RCON 6636 | 2,967,491 | / / / / / / / / / / / / / / | 13.a.(2)
b. In foreign offices, Edge and Agreement . . . . . . . . . . . . . . . . . . . | / / / / / / / / / / / / / / |
subsidiaries, and IBFs (from Schedule RC-E, part II) . . . . . . . . . . . . RCFN 2200 232,771 13.b.
(1) Noninterest-bearing . . . . . . . . . . . . . .| RCFN 6631 | 960 | / / / / / / / / / / / / / / | 13.b.(1)
(2) Interest-bearing. . . . . . . . . . . . . . . .| RCFN 6636 | 231,811 | / / / / / / / / / / / / / / | 13.b.(2)
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
| C400 |
Dollar Amounts in Thousands RCFD Bil Mil Thou
- ----------------------------------------------------------------------------- -----------------------------------
<S> <C> <C>
LIABILITIES (continued)
14. Federal funds purchased and securities sold under agreements to repurchase. . . RCON 2800 1,259,149 14.
15. a. Demand notes issued to the U.S. Treasury . . . . . . . . . . . . . . . . . . RCON 2840 410,759 15.a.
b. Trading liabilities (From Schedule RC-D) . . . . . . . . . . . . . . . . . . RCFD 3548 8,381 15.b.
16. Other borrowed money (including mortgage indebtedness and obligations under . . | / / / / / / / / / / / / / / |
capitalized leases) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | / / / / / / / / / / / / / / |
a. With a remaining maturity of one year or less. . . . . . . . . . . . . . . . RCFD 2332 3,253 16.a.
b. With a remaining maturity of more than one year through three years. . . . . RCFD A547 0 16.b.
c. With a remaining maturity of more than three years.. . . . . . . . . . . . . RCFD A547 20,000 16.c.
17. Not applicable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | / / / / / / / / / / / / / / |
18. Bank's liability on acceptances executed and outstanding . . . . . . . . . . . RCFD 2920 7,084 18.
19. Subordinated notes and debentures (2) . . . . . . . . . . . . . . . . . . . . . RCFD 3200 293,678 19.
20. Other liabilities (from Schedule RC-G) . . . . . . . . . . . . . . . . . . . . RCFD 2930 96,576 20.
21. Total liabilities (sum of items 13 through 20) . . . . . . . . . . . . . . . . RCFD 2948 6,834,742 21.
22. Not applicable

EQUITY CAPITAL
23. Perpetual preferred stock and related surplus. . . . . . . . . . . . . . . . . RCFD 3838 0 23.
24. Common stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 3230 75,600 24.
25. Surplus (exclude all surplus related to preferred stock). . . . . . . . . . . . RCFD 3839 126,843 25.
26. a. Undivided profits and capital reserves . . . . . . . . . . . . . . . . . . . RCFD 3632 339,860 26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities. . . RCFD 8434 5,560 26.b.
27. Cumulative foreign currency translation adjustments . . . . . . . . . . . . . . RCFD 3284 0 27.
28. Total equity capital (sum of items 23 through 27) . . . . . . . . . . . . . . . RCFD 3210 547,863 28.
29. Total liabilitiesand equity capital (sum of items 21 and 28) . . . . . . . . . RCFD 3300 7,382,605 29.

MEMORANDUM
TO BE REPORTED ONLY WITH THE MARCH REPORT OF CONDITION.
1. Indicate in the box at the right the number of the statement below that best Number
describes the most comprehensive level of auditing work performed for the ------
bank by independent external auditors as of any date during 1994. . . . . . . . . RCFD 6724 N/A M.1.

1 = Independent audit of the bank conducted 5 = Review of the bank's financial statements
in accordance with generally accepted by external auditors.
auditing standards by a certified public
accounting firm which submits a report
on the bank.

2 = Independent audit of the bank's parent 6 = Compilation of the bank's financial
holding company conducted in accordance statements by external auditors.
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 = Directors' examination of the bank 7 = Other audit procedures
conducted in accordance with generally (excluding tax preparation work).
accepted auditing standards by a certified
public accounting firm (may be
required by state chartering authority).

4 = Directors' examination of the bank performed 8 = No external audit work.
by other external auditors (may be required
by state chartering authority).
</TABLE>
___________

(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.