Exhibit 4.4


 




 





 


AMENDED
AND RESTATED DECLARATION


OF TRUST


 


by and
among


 


STATE
STREET BANK AND TRUST COMPANY


OF
CONNECTICUT, NATIONAL ASSOCIATION,


as
Institutional Trustee,


 


FIRST
REGIONAL BANCORP,


as
Sponsor,


 


and


JACK A.
SWEENEY, H. ANTHONY GARTSHORE and


THOMAS
MCCULLOUGH


as
Administrators,


 


Dated as
of December 18, 2001




 





 





















 


TABLE OF
CONTENTS


 


 


	
  ARTICLE I INTERPRETATION AND
  DEFINITIONS

  	
   

  
	
  Section
  1.1.

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II ORGANIZATION

  	
   

  
	
  Section 2.1.

  	
  Name

  	
   

  
	
  Section 2.2.

  	
  Office

  	
   

  
	
  Section 2.3.

  	
  Purpose

  	
   

  
	
  Section 2.4.

  	
  Authority

  	
   

  
	
  Section 2.5.

  	
  Title to Property of the Trust

  	
   

  
	
  Section 2.6.

  	
  Powers and Duties of the Institutional
  Trustee and the Administrators

  	
   

  
	
  Section 2.7.

  	
  Prohibition of Actions by the Trust and the
  Institutional Trustee

  	
   

  
	
  Section 2.8.

  	
  Powers and Duties of the Institutional
  Trustee

  	
   

  
	
  Section 2.9.

  	
  Certain Duties and Responsibilities of the
  Institutional Trustee and Administrators

  	
   

  
	
  Section 2.10.

  	
  Certain Rights of Institutional Trustee

  	
   

  
	
  Section 2.11.

  	
  Execution of Documents

  	
   

  
	
  Section 2.12.

  	
  Not Responsible for Recitals or Issuance
  of Securities

  	
   

  
	
  Section 2.13.

  	
  Duration of Trust

  	
   

  
	
  Section 2.14.

  	
  Mergers

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III SPONSOR

  	
   

  
	
  Section 3.1.

  	
  Sponsor’s Purchase of Common Securities

  	
   

  
	
  Section 3.2.

  	
  Responsibilities of the Sponsor

  	
   

  
	
  Section 3.3.

  	
  Expenses

  	
   

  
	
  Section 3.4.

  	
  Right to Proceed

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV INSTITUTIONAL
  TRUSTEE AND ADMINISTRATORS

  	
   

  
	
  Section 4.1.

  	
  Institutional Trustee; Eligibility

  	
   

  
	
  Section 4.2.

  	
  Administrators

  	
   

  
	
  Section 4.3.

  	
  Appointment, Removal and Resignation of
  Institutional Trustee and Administrators

  	
   

  
	
  Section 4.4.

  	
  Institutional Trustee Vacancies

  	
   

  
	
  Section 4.5.

  	
  Effect of Vacancies

  	
   

  
	
  Section 4.6.

  	
  Meetings of the Institutional Trustee and
  the Administrators

  	
   

  
	
  Section 4.7.

  	
  Delegation of Power

  	
   

  
	
  Section 4.8.

  	
  Conversion, Consolidation or Succession to
  Business

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V DISTRIBUTIONS

  	
   

  
	
  Section 5.1.

  	
  Distributions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI ISSUANCE OF
  SECURITIES

  	
   

  
	
  Section 6.1.

  	
  General Provisions Regarding Securities

  	
   

  
	
  Section 6.2.

  	
  Paying Agent, Transfer Agent and Registrar

  	
   

  
	
  Section 6.3.

  	
  Form and Dating

  	
   

  
	
  Section 6.4.

  	
  Mutilated, Destroyed, Lost or Stolen
  Certificates

  	
   

  
	
  Section 6.5.

  	
  Temporary Securities

  	
   

  
	
  Section 6.6.

  	
  Cancellation

  	
   

  



 


i





















 


	
  Section 6.7.

  	
  Rights of Holders; Waivers of Past Defaults

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII DISSOLUTION
  AND TERMINATION OF TRUST

  	
   

  
	
  Section 7.1.

  	
  Dissolution and Termination of Trust

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII TRANSFER
  OF INTERESTS

  	
   

  
	
  Section 8.1.

  	
  General

  	
   

  
	
  Section 8.2.

  	
  Transfer Procedures and Restrictions

  	
   

  
	
  Section 8.3.

  	
  Deemed Security Holders

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX LIMITATION OF LIABILITY OF
  HOLDERS OF SECURITIES, INSTITUTIONAL TRUSTEE OR OTHERS

  	
   

  
	
  Section 9.1.

  	
  Liability

  	
   

  
	
  Section 9.2.

  	
  Exculpation

  	
   

  
	
  Section 9.3.

  	
  Fiduciary Duty

  	
   

  
	
  Section 9.4.

  	
  Indemnification

  	
   

  
	
  Section 9.5.

  	
  Outside Businesses

  	
   

  
	
  Section 9.6.

  	
  Compensation; Fee

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X ACCOUNTING

  	
   

  
	
  Section 10.1.

  	
  Fiscal Year

  	
   

  
	
  Section 10.2.

  	
  Certain Accounting Matters

  	
   

  
	
  Section 10.3.

  	
  Banking

  	
   

  
	
  Section 10.4.

  	
  Withholding

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI AMENDMENTS AND
  MEETINGS

  	
   

  
	
  Section 11.1.

  	
  Amendments

  	
   

  
	
  Section 11.2.

  	
  Meetings of the Holders of Securities;
  Action by Written Consent

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII REPRESENTATIONS
  OF INSTITUTIONAL TRUSTEE

  	
   

  
	
  Section 12.1.

  	
  Representations and Warranties of
  Institutional Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIII
  MISCELLANEOUS

  	
   

  
	
  Section 13.1.

  	
  Notices

  	
   

  
	
  Section 13.2.

  	
  Governing Law

  	
   

  
	
  Section 13.3.

  	
  Intention of the Parties

  	
   

  
	
  Section 13.4.

  	
  Headings

  	
   

  
	
  Section 13.5.

  	
  Successors and Assigns

  	
   

  
	
  Section 13.6.

  	
  Partial Enforceability

  	
   

  
	
  Section 13.7.

  	
  Counterparts

  	
   

  



 


 


	
  Annex I

  	
  Terms of Securities

  
	
  Exhibit A-1

  	
  Form of Capital Security Certificate

  
	
  Exhibit A-2

  	
  Form of Common Security Certificate

  
	
  Exhibit B

  	
  Specimen of Initial Debenture

  
	
  Exhibit C

  	
  Placement Agreement

  



 


ii





















 


AMENDED
AND RESTATED


 


DECLARATION
OF TRUST


 


OF


 


FIRST
REGIONAL STATUTORY TRUST I


 


December
18, 2001


 


AMENDED
AND RESTATED DECLARATION OF TRUST (“Declaration”) dated and effective as
of December 18, 2001, by the Institutional Trustee (as defined herein), the
Administrators (as defined herein), the Sponsor (as defined herein) and by the
holders, from time to time, of undivided beneficial interests in the Trust (as
defined herein) to be issued pursuant to this Declaration;


 


WHEREAS,
the Institutional Trustee, the Administrators and the Sponsor established First
Regional Statutory Trust I (the “Trust”), a statutory trust under the
Statutory Trust Act (as defined herein) pursuant to a Declaration of Trust
dated as of October 29, 2001 (the “Original Declaration”), and a
Certificate of Trust filed with the Secretary of State of the State of
Connecticut on November 8, 2001, for the sole purpose of issuing and selling
certain securities representing undivided beneficial interests in the assets of
the Trust and investing the proceeds thereof in certain debentures of the
Debenture Issuer (as defined herein);


 


WHEREAS,
as of the date hereof, no interests in the Trust have been issued; and


 


WHEREAS,
the Institutional Trustee, the Administrators and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the
Original Declaration;


 


NOW,
THEREFORE, it being the intention of the parties hereto to continue the Trust
as a statutory trust under the Statutory Trust Act and that this Declaration
constitutes the governing instrument of such statutory trust, the Institutional
Trustee declares that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.  The parties hereto hereby agree as follows:


 


ARTICLE I


 


INTERPRETATION AND DEFINITIONS


 


Section 1.1.           Definitions.  Unless the context
otherwise requires:


 


(a)           Capitalized terms used in this
Declaration but not defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;


 


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


 


(c)           all references to “the Declaration”
or “this Declaration” are to this Declaration as modified, supplemented or
amended from time to time;


 


(d)           all references in this Declaration to
Articles and Sections and Annexes and Exhibits are to Articles and Sections of
and Annexes and Exhibits to this Declaration unless otherwise specified; and


 


1





















 


(e)           a reference to the singular includes
the plural and vice versa.


 


“Additional
Interest” has the meaning set forth in the Indenture.


 


“Administrative
Action” has the meaning set forth in paragraph 4(a) of Annex I.


 


“Administrators”
means each of Jack A. Sweeney, H. Anthony Gartshore and Thomas McCullough,
solely in such Person’s capacity as Administrator of the Trust created and
continued hereunder and not in such Person’s individual capacity, or such
Administrator’s successor in interest in such capacity, or any successor
appointed as herein provided.


 


“Affiliate”
has the same meaning as given to that term in Rule 405 of the Securities
Act or any successor rule thereunder.


 


“Authorized
Officer” of a Person means any Person that is authorized to bind such
Person.


 


“Bankruptcy
Event” means, with respect to any Person:


 


(a)           a court having jurisdiction in the
premises shall enter a decree or order for relief in respect of such Person in
an involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of such Person
or for any substantial part of its property, or ordering the winding-up or
liquidation of its affairs and such decree or order shall remain unstayed and
in effect for a period of 90 consecutive days; or


 


(b)           such Person shall commence a
voluntary case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, shall consent to the entry of an order for relief
in an involuntary case under any such law, or shall consent to the appointment
of or taking possession by a receiver, liquidator, assignee, trustee,
custodian, sequestrator (or other similar official) of such Person of any
substantial part of its property, or shall make any general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due.


 


“Business
Day” means any day other than Saturday, Sunday or any other day on which
banking institutions in New York City or Hartford, Connecticut are permitted or
required by any applicable law to close.


 


“Capital
Securities” has the meaning set forth in paragraph 1(a) of Annex I.


 


“Capital
Security Certificate” means a definitive Certificate in fully registered
form representing a Capital Security substantially in the form of
Exhibit A-1.


 


“Capital
Treatment Event” has the meaning set forth in paragraph 4(a) of
Annex I.


 


“Certificate”
means any certificate evidencing Securities.


 


“Closing
Date” has the meaning set forth in the Placement Agreement.


 


“Code”
means the Internal Revenue Code of 1986, as amended from time to time, or any
successor legislation.


 


“Common
Securities” has the meaning set forth in paragraph 1(b) of Annex I.


 


2





















 


“Common
Security Certificate” means a definitive Certificate in fully registered
form representing a Common Security substantially in the form of
Exhibit A-2.


 


“Company
Indemnified Person” means (a) any Administrator; (b) any
Affiliate of any Administrator; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Administrator;
or (d) any officer, employee or agent of the Trust or its Affiliates.


 


“Corporate
Trust Office” means the office of the Institutional Trustee at which the
corporate trust business of the Institutional Trustee shall, at any particular
time, be principally administered, which office at the date of execution of
this Declaration is located at 225 Asylum Street, Goodwin Square,
Hartford, Connecticut.


 


“Coupon
Rate” has the meaning set forth in paragraph 2(a) of Annex I.


 


“Covered
Person” means:  (a) any
Administrator, officer, director, shareholder, partner, member, representative,
employee or agent of (i) the Trust or (ii) any of the Trust’s
Affiliates; and (b) any Holder of Securities.


 


“Creditor”
has the meaning set forth in Section 3.3.


 


“Debenture
Issuer” means First Regional Bancorp, a California corporation, in its
capacity as issuer of the Debentures under the Indenture.


 


“Debenture
Trustee” means State Street Bank and Trust Company of Connecticut, National
Association, as trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.


 


“Debentures”
means the Floating Rate Junior Subordinated Deferrable Interest Debentures due
2031 to be issued by the Debenture Issuer under the Indenture.


 


“Defaulted
Interest” has the meaning set forth in the Indenture.


 


“Determination
Date” has the meaning set forth in paragraph 4(a) of Annex I.


 


“Direct
Action” has the meaning set forth in Section 2.8(d).


 


“Distribution”
means a distribution payable to Holders of Securities in accordance with
Section 5.1.


 


“Distribution
Payment Date” has the meaning set forth in paragraph 2(b) of
Annex I.


 


“Distribution
Period” has the meaning set forth in paragraph 2(a) of Annex I.


 


“Distribution
Rate” means, for the period beginning on (and including) the date of
original issuance and ending on (but excluding) March 18, 2002, 5.60%, and for
the period beginning on (and including) March 18, 2002 and thereafter, the
Coupon Rate.


 


“Event
of Default” means any one of the following events (whatever the reason for
such event and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):


 


(a)           the occurrence of an Indenture Event
of Default; or


 


3





















 


(b)           default by the Trust in the payment
of any Redemption Price of any Security when it becomes due and payable; or


 


(c)           default in the performance, or breach,
in any material respect, of any covenant or warranty of the Institutional
Trustee in this Declaration (other than those specified in clause (a) or
(b) above) and continuation of such default or breach for a period of
60 days after there has been given, by registered or certified mail to the
Institutional Trustee and to the Sponsor by the Holders of at least 25% in
aggregate liquidation amount of the outstanding Capital Securities a written
notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a “Notice of Default” hereunder; or


 


(d)           the occurrence of a Bankruptcy Event
with respect to the Institutional Trustee if a successor Institutional Trustee
has not been appointed within 90 days thereof.


 


“Extension
Period” has the meaning set forth in paragraph 2(b) of Annex I.


 


“Federal
Reserve” has the meaning set forth in paragraph 3 of Annex I.


 


“Fiduciary
Indemnified Person” shall mean the Institutional Trustee, any Affiliate of
the Institutional Trustee and any officers, directors, shareholders, members,
partners, employees, representatives, custodians, nominees or agents of the
Institutional Trustee.


 


“Fiscal
Year” has the meaning set forth in Section 10.1.


 


“Guarantee”
means the guarantee agreement to be dated as of the Closing Date, of the
Sponsor in respect of the Capital Securities.


 


“Holder”
means a Person in whose name a Certificate representing a Security is
registered, such Person being a beneficial owner within the meaning of the
Statutory Trust Act.


 


“Indemnified
Person” means a Company Indemnified Person or a Fiduciary Indemnified
Person.


 


“Indenture”
means the Indenture dated as of the Closing Date, between the Debenture Issuer
and the Debenture Trustee, and any indenture supplemental thereto pursuant to
which the Debentures are to be issued, as such Indenture and any supplemental
indenture may be amended, supplemented or otherwise modified from time to time.


 


“Indenture
Event of Default” means an “Event of Default” as defined in the Indenture.


 


“Institutional
Trustee” means the Trustee meeting the eligibility requirements set forth
in Section 4.1.


 


“Interest”
means any interest due on the Debentures including any Additional Interest and
Defaulted Interest.


 


“Investment
Company” means an investment company as defined in the Investment Company
Act.


 


“Investment
Company Act” means the Investment Company Act of 1940, as amended from time
to time, or any successor legislation.


 


“Investment
Company Event” has the meaning set forth in paragraph 4(a) of Annex I.


 


4





















 


“Liquidation”
has the meaning set forth in paragraph 3 of Annex I.


 


“Liquidation
Distribution” has the meaning set forth in paragraph 3 of
Annex I.


 


“Majority
in liquidation amount of the Securities” means Holder(s) of outstanding
Securities voting together as a single class or, as the context may require,
Holders of outstanding Capital Securities or Holders of outstanding Common
Securities voting separately as a class, who are the record owners of more than
50% of the aggregate liquidation amount (including the stated amount that would
be paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class.


 


“Maturity
Date” has the meaning set forth in paragraph 4(a) of Annex I.


 


“Officers’
Certificates” means, with respect to any Person, a certificate signed by
two Authorized Officers of such Person. 
Any Officers’ Certificate delivered with respect to compliance with a
condition or covenant providing for it in this Declaration shall include:


 


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


 


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


 


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


 


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


 


“OTS”
has the meaning set forth in paragraph 3 of Annex I.


 


“Paying
Agent” has the meaning specified in Section 6.2.


 


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


 


“Placement
Agreement” means the Placement Agreement relating to the offering and sale
of Capital Securities in the form of Exhibit C.


 


“Property
Account” has the meaning set forth in Section 2.8(c).


 


“Pro
Rata” has the meaning set forth in paragraph 8 of Annex I.


 


“Quorum”
means a majority of the Administrators or, if there are only two Administrators,
both of them.


 


“Redemption
Date” has the meaning set forth in paragraph 4(a) of Annex I.


 


“Redemption/Distribution
Notice” has the meaning set forth in paragraph 4(e) of Annex I.


 


“Redemption
Price” has the meaning set forth in paragraph 4(a) of Annex I.


 


5





















 


“Registrar”
has the meaning set forth in Section 6.2.


 


“Responsible
Officer” means, with respect to the Institutional Trustee, any officer
within the Corporate Trust Office of the Institutional Trustee, including any
vice-president, any assistant vice-president, any assistant secretary, the
treasurer, any assistant treasurer, any trust officer or other officer of the
Corporate Trust Office of the Institutional 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 that officer’s knowledge of and
familiarity with the particular subject.


 


“Restricted
Securities Legend” has the meaning set forth in Section 8.2(b).


 


“Rule 3a-5”
means Rule 3a-5 under the Investment Company Act.


 


“Rule 3a-7”
means Rule 3a-7 under the Investment Company Act.


 


“Securities”
means the Common Securities and the Capital Securities.


 


“Securities
Act” means the Securities Act of 1933, as amended from time to time, or any
successor legislation.


 


“Special
Event” has the meaning set forth in paragraph 4(a) of Annex I.


 


“Special
Redemption Date” has the meaning set forth in paragraph 4(a) of
Annex I.


 


“Special
Redemption Price” has the meaning set forth in paragraph 4(a) of
Annex I.


 


“Sponsor”
means First Regional Bancorp, a California corporation, or any successor entity
in a merger, consolidation or amalgamation, in its capacity as sponsor of the
Trust.


 


“Statutory
Trust Act” means Chapter 615 of Title 34 of the Connecticut General
Statutes, Sections 500, et seq. as may be amended from time to time.


 


“Successor
Entity” has the meaning set forth in Section 2.14(b).


 


“Successor
Institutional Trustee” has the meaning set forth in Section 4.3(a).


 


“Successor
Securities” has the meaning set forth in Section 2.14(b).


 


“Super
Majority” has the meaning set forth in paragraph 5(b) of Annex I.


 


“Tax
Event” has the meaning set forth in paragraph 4(a) of Annex I.


 


“10%
in liquidation amount of the Securities” means Holder(s) of outstanding
Securities voting together as a single class or, as the context may require,
Holders of outstanding Capital Securities or Holders of outstanding Common
Securities voting separately as a class, who are the record owners of 10% or
more of the aggregate liquidation amount (including the stated amount that
would be paid on redemption, liquidation or otherwise, plus accrued and unpaid Distributions
to the date upon which the voting percentages are determined) of all
outstanding Securities of the relevant class.


 


“3-Month
LIBOR” has the meaning set forth in paragraph 4(a) of Annex I.


 


“Transfer
Agent” has the meaning set forth in Section 6.2.


 


6





















 


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


 


“Trust
Property” means (a) the Debentures, (b) any cash on deposit in,
or owing to, the Property Account and (c) all proceeds and rights in
respect of the foregoing and any other property and assets for the time being
held or deemed to be held by the Institutional Trustee pursuant to the trusts
of this Declaration.


 


“U.S.
Person” means a United States Person as defined in Section 7701(a)(30) of
the Code.


 


ARTICLE II


 


ORGANIZATION


 


Section 2.1.           Name.  The Trust is named “First Regional
Statutory Trust I,” as such name may be modified from time to time by the
Administrators following written notice to the Holders of the Securities.  The Trust’s activities may be conducted under
the name of the Trust or any other name deemed advisable by the Administrators.


 


Section 2.2.           Office.  The address of the principal
office of the Trust is c/o State Street Bank and Trust Company of Connecticut,
National Association, 225 Asylum Street, Goodwin Square, Hartford,
Connecticut  06103.  On at least 10 Business Days written
notice to the Holders of the Securities, the Administrators may designate
another principal office, which shall be in a state of the United States or in
the District of Columbia.


 


Section 2.3.           Purpose.  The exclusive purposes and
functions of the Trust are (a) to issue and sell the Securities
representing undivided beneficial interests in the assets of the Trust,
(b) to invest the gross proceeds from such sale to acquire the Debentures,
(c) to facilitate direct investment in the assets of the Trust through
issuance of the Common Securities and the Capital Securities and
(d) except as otherwise limited herein, to engage in only those other
activities necessary or incidental thereto.  The Trust shall not borrow money, issue debt
or reinvest proceeds derived from investments, pledge any of its assets, or
otherwise undertake (or permit to be undertaken) any activity that would cause
the Trust not to be classified for United States federal income tax purposes as
a grantor trust.


 


Section 2.4.           Authority.  Except as specifically provided in
this Declaration, the Institutional Trustee shall have exclusive and complete
authority to carry out the purposes of the Trust.  An action taken by the Institutional Trustee
in accordance with its powers shall constitute the act of and serve to bind the
Trust.  In dealing with the Institutional
Trustee acting on behalf of the Trust, no Person shall be required to inquire
into the authority of the Institutional Trustee to bind the Trust.  Persons dealing with the Trust are entitled
to rely conclusively on the power and authority of the Institutional Trustee as
set forth in this Declaration.  The
Administrators shall have only those ministerial duties set forth herein with
respect to accomplishing the purposes of the Trust and are not intended to be
trustees or fiduciaries with respect to the Trust or the Holders.  The Institutional Trustee shall have the
right, but shall not be obligated except as provided in Section 2.6, to perform
those duties assigned to the Administrators.


 


Section 2.5.           Title to Property
of the Trust.  Except as
provided in Section 2.8 with respect to the Debentures and the Property Account
or as otherwise provided in this Declaration, legal title to all assets of the
Trust shall be vested in the Trust.  The
Holders shall not have legal title to any part of the assets of the Trust, but
shall have an undivided beneficial interest in the assets of the Trust.


 


7





















 


Section 2.6.           Powers and Duties
of the Institutional Trustee and the Administrators.


 


(a)           The Institutional Trustee and the
Administrators shall conduct the affairs of the Trust in accordance with the
terms of this Declaration.  Subject to
the limitations set forth in paragraph (b) of this Section, and in
accordance with the following provisions (i) and (ii), the Institutional
Trustee and the Administrators shall have the authority to enter into all
transactions and agreements determined by the Institutional Trustee to be
appropriate in exercising the authority, express or implied, otherwise granted
to the Institutional Trustee or the Administrators, as the case may be, under
this Declaration, and to perform all acts in furtherance thereof, including
without limitation, the following:


 


(i)            Each Administrator shall have the
power and authority to act on behalf of the Trust with respect to the following
matters:


 


(A)  the issuance and sale of the Securities;


 


(B)  to cause the Trust to enter into, and to
execute and deliver on behalf of the Trust, such agreements as may be necessary
or desirable in connection with the purposes and function of the Trust,
including agreements with the Paying Agent;


 


(C)  ensuring compliance with the Securities Act,
applicable state securities or blue sky laws;


 


(D)  the sending of notices (other than notices of
default), and other information regarding the Securities and the Debentures to
the Holders in accordance with this Declaration;


 


(E)  the consent to the appointment of a Paying
Agent, Transfer Agent and Registrar in accordance with this Declaration, which
consent shall not be unreasonably withheld or delayed;


 


(F)  execution and delivery of the Securities in
accordance with this Declaration;


 


(G)  execution and delivery of closing
certificates pursuant to the Placement Agreement and the application for a
taxpayer identification number;


 


(H)  unless otherwise determined by the Holders of
a Majority in liquidation amount of the Securities or as otherwise required by
the Statutory Trust Act, to execute on behalf of the Trust (either acting alone
or together with any or all of the Administrators) any documents that the
Administrators have the power to execute pursuant to this Declaration;


 


(I)  the taking of any action incidental to the
foregoing as the Institutional Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this Declaration for the
benefit of the Holders (without consideration of the effect of any such action
on any particular Holder);


 


(J)  to establish a record date with respect to
all actions to be taken hereunder that require a record date be established,
including Distributions, voting rights, redemptions and exchanges, and to issue
relevant notices to the Holders of Capital Securities and Holders of Common
Securities as to such actions and applicable record dates; and


 


8





















 


(K)  to duly prepare and file all applicable tax
returns and tax information reports that are required to be filed with respect
to the Trust on behalf of the Trust.


 


(ii)           As among the Institutional Trustee
and the Administrators, the Institutional Trustee shall have the power, duty
and authority to act on behalf of the Trust with respect to the following
matters:


 


(A)  the establishment of the Property Account;


 


(B)  the receipt of the Debentures;


 


(C)  the collection of interest, principal and any
other payments made in respect of the Debentures in the Property Account;


 


(D)  the distribution through the Paying Agent of
amounts owed to the Holders in respect of the Securities;


 


(E)  the exercise of all of the rights, powers and
privileges of a holder of the Debentures;


 


(F)  the sending of notices of default and other
information regarding the Securities and the Debentures to the Holders in
accordance with this Declaration;


 


(G)  the distribution of the Trust Property in
accordance with the terms of this Declaration;


 


(H)  to the extent provided in this Declaration,
the winding up of the affairs of and liquidation of the Trust and the
preparation, execution and filing of the certificate of cancellation with the
Secretary of State of the State of Connecticut;


 


(I)  after any Event of Default (provided
that such Event of Default is not by or with respect to the Institutional
Trustee) the taking of any action incidental to the foregoing as the
Institutional Trustee may from time to time determine is necessary or advisable
to give effect to the terms of this Declaration and protect and conserve the Trust
Property for the benefit of the Holders (without consideration of the effect of
any such action on any particular Holder); and


 


(J)  to take all action that may be necessary for
the preservation and the continuation of the Trust’s valid existence, rights,
franchises and privileges as a statutory trust under the laws of the State of
Connecticut and of each other jurisdiction in which such existence is necessary
to protect the limited liability of the Holders of the Capital Securities or to
enable the Trust to effect the purposes for which the Trust was created.


 


(iii)          The Institutional Trustee shall have
the power and authority to act on behalf of the Trust with respect to any of
the duties, liabilities, powers or the authority of the Administrators set forth
in Section 2.6(a)(i)(D), (E) and (F) herein but shall not have a duty to
do any such act unless specifically requested to do so in writing by the
Sponsor, and shall then be fully protected in acting pursuant to such written
request; and in the event of a conflict between the action of the
Administrators and the action of the Institutional Trustee, the action of the
Institutional Trustee shall prevail.


 


9





















 


(b)           So long as this Declaration remains
in effect, the Trust (or the Institutional Trustee or Administrators acting on
behalf of the Trust) shall not undertake any business, activities or
transaction except as expressly provided herein or contemplated hereby. In
particular, neither the Institutional Trustee nor the Administrators may cause
the Trust to (i) acquire any investments or engage in any activities not
authorized by this Declaration, (ii) sell, assign, transfer, exchange,
mortgage, pledge, set-off or otherwise dispose of any of the Trust Property or
interests therein, including to Holders, except as expressly provided herein,
(iii) take any action that would reasonably be expected (x) to cause the
Trust to fail or cease to qualify as a “grantor trust” for United States
federal income tax purposes or (y) to require the trust to register as an
Investment Company under the Investment Company Act, (iv) incur any
indebtedness for borrowed money or issue any other debt or (v) take or
consent to any action that would result in the placement of a lien on any of
the Trust Property.  The Institutional
Trustee shall, at the sole cost and expense of the Trust, defend all claims and
demands of all Persons at any time claiming any lien on any of the Trust
Property adverse to the interest of the Trust or the Holders in their capacity
as Holders.


 


(c)           In connection with the issuance and
sale of the Capital Securities, the Sponsor shall have the right and
responsibility to assist the Trust with respect to, or effect on behalf of the
Trust, the following (and any actions taken by the Sponsor in furtherance of
the following prior to the date of this Declaration are hereby ratified and
confirmed in all respects):


 


(i)            the taking of any action necessary
to obtain an exemption from the Securities Act;


 


(ii)           the determination of the States in
which to take appropriate action to qualify or register for sale all or part of
the Capital Securities and the determination of any and all such acts, other
than actions which must be taken by or on behalf of the Trust, and the advice to
the Administrators of actions they must take on behalf of the Trust, and the
preparation for execution and filing of any documents to be executed and filed
by the Trust or on behalf of the Trust, as the Sponsor deems necessary or
advisable in order to comply with the applicable laws of any such States in
connection with the sale of the Capital Securities;


 


(iii)          the negotiation of the terms of, and
the execution and delivery of, the Placement Agreement providing for the sale
of the Capital Securities; and


 


(iv)          the taking of any other actions
necessary or desirable to carry out any of the foregoing activities.


 


(d)           Notwithstanding anything herein to
the contrary, the Administrators and the Holders of a Majority in liquidation
amount of the Common Securities are authorized and directed to conduct the
affairs of the Trust and to operate the Trust so that the Trust will not (i) be
deemed to be an Investment Company required to be registered under the
Investment Company Act, and (ii) fail to be classified as a “grantor trust”
for United States federal income tax purposes. 
The Administrators and the Holders of a Majority in liquidation amount
of the Common Securities shall not take any action inconsistent with the
treatment of the Debentures as indebtedness of the Debenture Issuer for United
States federal income tax purposes.  In
this connection, the Administrators and the Holders of a Majority in
liquidation amount of the Common Securities are authorized to take any action,
not inconsistent with applicable laws, the Certificate of Trust or this
Declaration, as amended from time to time, that each of the Administrators and
the Holders of a Majority in liquidation amount of the Common Securities
determines in their discretion to be necessary or desirable for such purposes.


 


10





















 


(e)           All expenses incurred by the
Administrators or the Institutional Trustee pursuant to this Section 2.6 shall
be reimbursed by the Sponsor, and the Institutional Trustee and the
Administrators shall have no obligations with respect to such expenses.


 


(f)            The assets of the Trust shall
consist of the Trust Property.


 


(g)           Legal title to all Trust Property
shall be vested at all times in the Institutional Trustee (in its capacity as
such) and shall be held and administered by the Institutional Trustee and the
Administrators for the benefit of the Trust in accordance with this
Declaration.


 


(h)           If the Institutional Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Declaration and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Institutional Trustee or to
such Holder, then and in every such case the Sponsor, the Institutional Trustee
and the Holders shall, subject to any determination in such proceeding, be
restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Institutional Trustee and the Holders
shall continue as though no such proceeding had been instituted.


 


Section 2.7.           Prohibition of
Actions by the Trust and the Institutional Trustee.


 


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


 


(i)            invest any proceeds received by the
Trust from holding the Debentures, but shall distribute all such proceeds to
Holders of the Securities pursuant to the terms of this Declaration and of the
Securities;


 


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


 


(iii)          possess Trust Property for other than
a Trust purpose;


 


(iv)          make any loans or incur any
indebtedness other than loans represented by the Debentures;


 


(v)           possess any power or otherwise act in
such a way as to vary the Trust assets or the terms of the Securities in any
way whatsoever other than as expressly provided herein;


 


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


 


(vii)         carry on any “trade or business” as
that phrase is used in the Code; or


 


(viii)        other than as provided in this
Declaration (including Annex I), (A) direct the time, method and
place of exercising any trust or power conferred upon the Debenture Trustee
with respect to the Debentures, (B) waive any past default that is
waivable under the Indenture, (C) exercise any right to rescind or annul
any declaration that the principal of all the Debentures shall be due and
payable, or (D) consent to any amendment, modification or termination of
the Indenture or the Debentures where such consent shall be required unless the
Trust shall have received an opinion of counsel to the effect that such
modification will not cause the Trust to cease to be classified as a “grantor
trust” for United States federal income tax purposes.


 


11





















 


Section 2.8.           Powers and Duties
of the Institutional Trustee.


 


(a)           The legal title to the Debentures
shall be owned by and held of record in the name of the Institutional Trustee
in trust for the benefit of the Trust and the Holders of the Securities.  The right, title and interest of the
Institutional Trustee to the Debentures shall vest automatically in each Person
who may hereafter be appointed as Institutional Trustee in accordance with
Section 4.3.  Such vesting and cessation
of title shall be effective whether or not conveyancing documents with regard to
the Debentures have been executed and delivered.


 


(b)           The Institutional Trustee shall not
transfer its right, title and interest in the Debentures to the Administrators.


 


(c)           The Institutional Trustee shall:


 


(i)            establish and maintain a segregated
non-interest bearing trust account (the “Property Account”) in the name
of and under the exclusive control of the Institutional Trustee, and maintained
in the Institutional Trustee’s trust department, on behalf of the Holders of
the Securities and, upon the receipt of payments of funds made in respect of
the Debentures held by the Institutional Trustee, deposit such funds into the
Property Account and make payments, or cause the Paying Agent to make payments,
to the Holders of the Capital Securities and Holders of the Common Securities
from the Property Account in accordance with Section 5.1.  Funds in the Property Account shall be held
uninvested until disbursed in accordance with this Declaration;


 


(ii)           engage in such ministerial activities
as shall be necessary or appropriate to effect the redemption of the Capital
Securities and the Common Securities to the extent the Debentures are redeemed
or mature; and


 


(iii)          upon written notice of distribution
issued by the Administrators in accordance with the terms of the Securities,
engage in such ministerial activities as shall be necessary or appropriate to
effect the distribution of the Debentures to Holders of Securities upon the
occurrence of certain circumstances pursuant to the terms of the Securities.


 


(d)           The Institutional Trustee may bring
or defend, pay, collect, compromise, arbitrate, resort to legal action with
respect to, or otherwise adjust claims or demands of or against, the Trust
which arises out of or in connection with an Event of Default of which a Responsible
Officer of the Institutional Trustee has actual knowledge or arises out of the
Institutional Trustee’s duties and obligations under this Declaration; provided,
however, that if an Event of Default has occurred and is continuing and
such event is attributable to the failure of the Debenture Issuer to pay
interest or principal on the Debentures on the date such interest or principal
is otherwise payable (or in the case of redemption, on the redemption date),
then a Holder of the Capital Securities may directly institute a proceeding for
enforcement of payment to such Holder of the principal of or interest on the
Debentures having a principal amount equal to the aggregate liquidation amount
of the Capital Securities of such Holder (a “Direct Action”) on or after
the respective due date specified in the Debentures.  In connection with such Direct Action, the
rights of the Holders of the Common Securities will be subrogated to the rights
of such Holder of the Capital Securities to the extent of any payment made by
the Debenture Issuer to such Holder of the Capital Securities in such Direct
Action; provided, however, that no Holder of the Common
Securities may exercise such right of subrogation so long as an Event of
Default with respect to the Capital Securities has occurred and is continuing.


 


(e)           The Institutional Trustee shall
continue to serve as a Trustee until either:


 


12





















 


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


 


(ii)           a Successor Institutional Trustee has
been appointed and has accepted that appointment in accordance with Section
4.3.


 


(f)            The Institutional Trustee shall have
the legal power to exercise all of the rights, powers and privileges of a
Holder of the Debentures under the Indenture and, if an Event of Default occurs
and is continuing, the Institutional Trustee may, for the benefit of Holders of
the Securities, enforce its rights as holder of the Debentures subject to the
rights of the Holders pursuant to this Declaration (including Annex I) and
the terms of the Securities.


 


The
Institutional Trustee must exercise the powers set forth in this Section 2.8 in
a manner that is consistent with the purposes and functions of the Trust set
out in Section 2.3, and the Institutional Trustee shall not take any action
that is inconsistent with the purposes and functions of the Trust set out in
Section 2.3.


 


Section 2.9.           Certain Duties and
Responsibilities of the Institutional Trustee and Administrators.


 


(a)           The Institutional Trustee, before the
occurrence of any Event of Default and after the curing or waiving of all such
Events of Default that may have occurred, shall undertake to perform only such
duties as are specifically set forth in this Declaration and no implied
covenants shall be read into this Declaration against the Institutional
Trustee.  In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section 6.7), the
Institutional Trustee shall exercise such of the rights and powers vested in it
by this Declaration, and use the same degree of care and skill in their
exercise, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.


 


(b)           The duties and responsibilities of
the Institutional Trustee and the Administrators shall be as provided by this
Declaration.  Notwithstanding the
foregoing, no provision of this Declaration shall require the Institutional
Trustee or Administrators to expend or risk their own funds or otherwise incur
any financial liability in the performance of any of their duties hereunder, or
in the exercise of any of their rights or powers if it shall have reasonable
grounds to believe that repayment of such funds or adequate protection against
such risk of liability is not reasonably assured to it.  Whether or not therein expressly so provided,
every provision of this Declaration relating to the conduct or affecting the
liability of or affording protection to the Institutional Trustee or
Administrators shall be subject to the provisions of this Article.  Nothing in this Declaration shall be
construed to relieve an Administrator or the Institutional Trustee from
liability for its own negligent act, its own negligent failure to act, or its
own willful misconduct.  To the extent
that, at law or in equity, the Institutional Trustee or an Administrator has
duties and liabilities relating to the Trust or to the Holders, the
Institutional Trustee or such Administrator shall not be liable to the Trust or
to any Holder for the Institutional Trustee’s or such Administrator’s good
faith reliance on the provisions of this Declaration.  The provisions of this Declaration, to the
extent that they restrict the duties and liabilities of the Administrators or
the Institutional Trustee otherwise existing at law or in equity, are agreed by
the Sponsor and the Holders to replace such other duties and liabilities of the
Administrators or the Institutional Trustee.


 


(c)           All payments made by the
Institutional Trustee or a Paying Agent in respect of the Securities shall be
made only from the revenue and proceeds from the Trust Property and only to the
extent that there shall be sufficient revenue or proceeds from the Trust
Property to enable the Institutional Trustee or a Paying Agent to make payments
in accordance with the terms hereof. 
Each Holder, by its acceptance of a Security, agrees that it will look
solely to the revenue and proceeds from the Trust


 


13





















 


Property to the extent legally available for distribution to it as
herein provided and that the Institutional Trustee and the Administrators are
not personally liable to it for any amount distributable in respect of any
Security or for any other liability in respect of any Security.  This Section 2.9(c) does not limit the
liability of the Institutional Trustee expressly set forth elsewhere in this
Declaration.


 


(d)           The Institutional Trustee shall not
be liable for its own acts or omissions hereunder except as a result of its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:


 


(i)            the Institutional Trustee shall not
be liable for any error of judgment made in good faith by an Authorized Officer
of the Institutional Trustee, unless it shall be proved that the Institutional
Trustee was negligent in ascertaining the pertinent facts;


 


(ii)           the Institutional Trustee shall not
be liable with respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of not less than a
Majority in liquidation amount of the Capital Securities or the Common
Securities, as applicable, relating to the time, method and place of conducting
any proceeding for any remedy available to the Institutional Trustee, or
exercising any trust or power conferred upon the Institutional Trustee under
this Declaration;


 


(iii)          the Institutional Trustee’s sole duty
with respect to the custody, safekeeping and physical preservation of the
Debentures and the Property Account shall be to deal with such property in a
similar manner as the Institutional Trustee deals with similar property for its
fiduciary accounts generally, subject to the protections and limitations on
liability afforded to the Institutional Trustee under this Declaration;


 


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


 


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


 


Section 2.10.        Certain Rights of
Institutional Trustee.  Subject
to the provisions of Section 2.9:


 


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


 


(b)           if (i) in performing its duties
under this Declaration, the Institutional Trustee is required to decide between
alternative courses of action, (ii) in construing any of the provisions of
this Declaration, the Institutional Trustee finds the same ambiguous or
inconsistent with any other provisions contained herein, or (iii) the
Institutional Trustee is unsure of the application of any provision of this
Declaration, then, except as to any matter as to which the Holders of Capital
Securities are entitled to vote under the


 


14





















 


terms of this Declaration, the Institutional Trustee may deliver a
notice to the Sponsor requesting the Sponsor’s written instructions as to the
course of action to be taken and the Institutional Trustee shall take such
action, or refrain from taking such action, as the Institutional Trustee shall
be instructed in writing, in which event the Institutional Trustee shall have
no liability except for its own negligence or willful misconduct;


 


(c)           any direction or act of the Sponsor
or the Administrators contemplated by this Declaration shall be sufficiently
evidenced by an Officers’ Certificate;


 


(d)           whenever in the administration of
this Declaration, the Institutional Trustee shall deem it desirable that a
matter be proved or established before undertaking, suffering or omitting any
action hereunder, the Institutional Trustee (unless other evidence is herein
specifically prescribed) may request and conclusively rely upon an Officers’
Certificate as to factual matters which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Administrators;


 


(e)           the Institutional Trustee shall have
no duty to see to any recording, filing or registration of any instrument
(including any financing or continuation statement or any filing under tax or
securities laws) or any rerecording, refiling or reregistration thereof;


 


(f)            the Institutional Trustee may
consult with counsel of its selection (which counsel may be counsel to the
Sponsor or any of its Affiliates) and the advice of such 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 and
in accordance with such advice; the Institutional Trustee shall have the right
at any time to seek instructions concerning the administration of this
Declaration from any court of competent jurisdiction;


 


(g)           the Institutional Trustee shall be
under no obligation to exercise any of the rights or powers vested in it by
this Declaration at the request or direction of any of the Holders pursuant to
this Declaration, unless such Holders shall have offered to the Institutional
Trustee security or indemnity reasonably satisfactory to it against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction; provided, that nothing contained in this Section
2.10(g) shall be taken to relieve the Institutional Trustee, subject to Section
2.9(b), upon the occurrence of an Event of Default, to exercise such of the
rights and powers vested in it by this Declaration, and use the same degree of
care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs;


 


(h)           the Institutional 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, consent, order, approval, bond, debenture, note or other evidence of
indebtedness or other paper or document, unless requested in writing to do so
by one or more Holders, but the Institutional Trustee may make such further
inquiry or investigation into such facts or matters as it may see fit;


 


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


 


(j)            whenever in the administration of
this Declaration the Institutional Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right or taking any other
action hereunder the Institutional Trustee (i) may request instructions
from the Holders of the Capital Securities which instructions may only be given
by the Holders of the same proportion in liquidation amount of the Capital
Securities as would be entitled to direct the Institutional Trustee under the
terms of the Capital


 


15





















 


Securities in respect of such remedy, right or action, (ii) may
refrain from enforcing such remedy or right or taking such other action until
such instructions are received, and (iii) shall be fully protected in
acting in accordance with such instructions;


 


(k)           except as otherwise expressly
provided in this Declaration, the Institutional Trustee shall not be under any
obligation to take any action that is discretionary under the provisions of
this Declaration;


 


(l)            when the Institutional Trustee
incurs expenses or renders services in connection with a Bankruptcy Event, such
expenses (including the fees and expenses of its counsel) and the compensation
for such services are intended to constitute expenses of administration under
any bankruptcy law or law relating to creditors rights generally;


 


(m)          the Institutional Trustee shall not be
charged with knowledge of an Event of Default unless a Responsible Officer of
the Institutional Trustee obtains actual knowledge of such event or the
Institutional Trustee receives written notice of such event from any Holder,
the Sponsor or the Debenture Trustee;


 


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


 


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


 


Section 2.11.        Execution of Documents.  Unless otherwise determined in
writing by the Institutional Trustee, and except as otherwise required by the
Statutory Trust Act, the Institutional Trustee, or any one or more of the
Administrators, as the case may be, is authorized to execute on behalf of the
Trust any documents that the Institutional Trustee or the Administrators, as
the case may be, have the power and authority to execute pursuant to Section
2.6.


 


Section 2.12.        Not Responsible for
Recitals or Issuance of Securities.  The
recitals contained in this Declaration and the Securities shall be taken as the
statements of the Sponsor, and the Institutional Trustee does not assume any
responsibility for their correctness. 
The Institutional Trustee makes no representations as to the value or
condition of the property of the Trust or any part thereof.  The Institutional Trustee makes no
representations as to the validity or sufficiency of this Declaration, the
Debentures or the Securities.


 


Section 2.13.        Duration of Trust.  The Trust, unless earlier
dissolved pursuant to the provisions of Article VII hereof, shall be in
existence for 35 years from the Closing Date.


 


Section 2.14.        Mergers.


 


(a)           The Trust may not consolidate,
amalgamate, merge with or into, or be replaced by, or convey, transfer or lease
its properties and assets substantially as an entirety to any corporation or
other body, except as described in this Section 2.14(b) and (c) and except in
connection with the liquidation of


 


16





















 


the Trust and the distribution of the Debentures to Holders of
Securities pursuant to Section 7.1(a)(iv) of the Declaration or Section 4 of
Annex I.


 


(b)           The Trust may, with the consent of
the Institutional Trustee and without the consent of the Holders of the Capital
Securities, consolidate, amalgamate, merge with or into, or be replaced by a
trust organized as such under the laws of any state; provided that:


 


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


 


(A)  expressly assumes all of the obligations of
the Trust under the Securities; or


 


(B)  substitutes for the Securities other securities
having substantially the same terms as the Securities (the “Successor
Securities”) so that the Successor Securities rank the same as the
Securities rank with respect to Distributions and payments upon Liquidation,
redemption and otherwise;


 


(ii)           the Sponsor expressly appoints a
trustee of the Successor Entity that possesses the same powers and duties as
the Institutional Trustee as the Holder of the Debentures;


 


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


 


(iv)          the Institutional Trustee receives
written confirmation from Moody’s Investor Services, Inc. or any other
nationally recognized statistical rating organization that rates securities
issued by the initial purchaser of the Capital Securities that it will not
reduce or withdraw the rating of any such securities because of such merger,
conversion, consolidation, amalgamation or replacement;


 


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


 


(vi)          prior to such merger, consolidation,
amalgamation or replacement, the Trust has received an opinion of a nationally
recognized independent counsel to the Trust experienced in such matters to the
effect that:


 


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


 


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


 


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


 


(vii)         the Sponsor guarantees the obligations
of such Successor Entity under the Successor Securities at least to the extent
provided by the Guarantee;


 


(viii)        the Sponsor owns 100% of the common
securities of any Successor Entity; and


 


17





















 


(ix)           prior to such merger, consolidation,
amalgamation or replacement, the Institutional Trustee shall have received an
Officers’ Certificate of the Administrators and an opinion of counsel, each to
the effect that all conditions precedent under this Section 2.14(b) to such
transaction have been satisfied.


 


(c)           Notwithstanding Section 2.14(b), the
Trust shall not, except with the consent of Holders of 100% in aggregate
liquidation amount of the Securities, consolidate, amalgamate, merge with or
into, or be replaced by any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger or replacement would cause the Trust or
Successor Entity to be classified as other than a grantor trust for United
States federal income tax purposes.


 


ARTICLE III


 


SPONSOR


 


Section 3.1.           Sponsor’s Purchase
of Common Securities.  On
the Closing Date, the Sponsor will purchase all of the Common Securities issued
by the Trust in an amount at least equal to 3% of the capital of the Trust, at
the same time as the Capital Securities are sold.


 


Section 3.2.           Responsibilities of
the Sponsor.  In
connection with the issue and sale of the Capital Securities, the Sponsor shall
have the exclusive right and responsibility to engage in, or direct the
Administrators to engage in, the following activities:


 


(a)           to determine the States in which to
take appropriate action to qualify or register for sale all or part of the
Capital Securities and to do any and all such acts, other than actions which
must be taken by the Trust, and advise the Trust of actions it must take, and
prepare for execution and filing any documents to be executed and filed by the
Trust, as the Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such States; and


 


(b)           to negotiate the terms of and/or
execute on behalf of the Trust, the Placement Agreement and other related
agreements providing for the sale of the Capital Securities.


 


Section 3.3.           Expenses.  In connection with the offering,
sale and issuance of the Debentures to the Trust and in connection with the
sale of the Securities by the Trust, the Sponsor, in its capacity as Debenture
Issuer, shall:


 


(a)           pay
all reasonable costs and expenses relating to the offering, sale and issuance
of the Debentures, including compensation of the Debenture Trustee under the
Indenture in accordance with the provisions of the Indenture;


 


(b)           be
responsible for and shall pay all debts and obligations (other than with
respect to the Securities) and all costs and expenses of the Trust (including,
but not limited to, costs and expenses relating to the organization,
maintenance and dissolution of the Trust), the offering, sale and issuance of
the Securities (including fees to the placement agents in connection
therewith), the fees and expenses (including reasonable counsel fees and
expenses) of the Institutional Trustee and the Administrators, the costs and
expenses relating to the operation of the Trust, including, without limitation,
costs and expenses of accountants, attorneys, statistical or bookkeeping
services, expenses for printing and engraving and computing or accounting
equipment, Paying Agents, Registrars, Transfer Agents, duplicating, travel and
telephone and other telecommunications expenses and costs and expenses incurred
in connection with the acquisition, financing, and disposition of Trust assets
and the enforcement by the Institutional Trustee of the rights of the Holders;
and


 


18





















 


(c)           to pay any and all taxes (other than
United States withholding taxes attributable to the Trust or its assets) and
all liabilities, costs and expenses with respect to such taxes of the Trust.


 


The
Sponsor’s obligations under this Section 3.3 shall be for the benefit of,
and shall be enforceable by, any Person to whom such debts, obligations, costs,
expenses and taxes are owed (a “Creditor”) whether or not such Creditor
has received notice hereof.  Any such
Creditor may enforce the Sponsor’s obligations under this Section 3.3
directly against the Sponsor and the Sponsor irrevocably waives any right or
remedy to require that any such Creditor take any action against the Trust or
any other Person before proceeding against the Sponsor.  The Sponsor agrees to execute such additional
agreements as may be necessary or desirable in order to give full effect to the
provisions of this Section 3.3.


 


Section 3.4.           Right to Proceed.  The Sponsor acknowledges the
rights of Holders to institute a Direct Action as set forth in Section
2.8(d)hereto.


 


ARTICLE IV


 


INSTITUTIONAL TRUSTEE AND
ADMINISTRATORS


 


Section 4.1.           Institutional
Trustee; Eligibility.


 


(a)           There shall at all times be one
Institutional Trustee which shall:


 


(i)            not be an Affiliate of the Sponsor;


 


(ii)           not offer or provide credit or credit
enhancement to the Trust; and


 


(iii)          be a banking corporation or trust
company organized and doing business under the laws of the United States of
America or any state thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least 50 million U.S. dollars ($50,000,000.00), and subject to
supervision or examination by Federal, state, or District of Columbia
authority.  If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to above, then for the
purposes of this Section 4.1(a)(iii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published.


 


(b)           If at any time the Institutional
Trustee shall cease to be eligible to so act under Section 4.1(a), the
Institutional Trustee shall immediately resign in the manner and with the
effect set forth in Section 4.3(a).


 


(c)           If the Institutional Trustee has or
shall acquire any “conflicting interest” within the meaning of Section 310(b)
of the Trust Indenture Act of 1939, as amended, the Institutional Trustee shall
either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to this Declaration.


 


(d)           The initial Institutional Trustee
shall be State Street Bank and Trust Company of Connecticut, National
Association.


 


Section 4.2.           Administrators.  Each Administrator shall be a U.S.
Person, 21 years of age or older and authorized to bind the Sponsor.  The initial Administrators shall be Jack A.
Sweeney, H. Anthony Gartshore and Thomas McCullough.  There shall at all times be at least one
Administrator.  Except where a requirement
for action by a specific number of Administrators is expressly set forth in
this


 


19





















 


Declaration and except with respect to any action the taking of which
is the subject of a meeting of the Administrators, any action required or
permitted to be taken by the Administrators may be taken by, and any power of
the Administrators may be exercised by, or with the consent of, any one such
Administrator.


 


Section 4.3.           Appointment, Removal
and Resignation of Institutional Trustee and Administrators.


 


(a)           Notwithstanding anything to the
contrary in this Declaration, no resignation or removal of the Institutional
Trustee and no appointment of a Successor Institutional Trustee pursuant to
this Article shall become effective until the acceptance of appointment by the
Successor Institutional Trustee in accordance with the applicable requirements
of this Section 4.3.


 


Subject
to the immediately preceding paragraph, the Institutional Trustee may resign at
any time by giving written notice thereof to the Holders of the Securities and
by appointing a Successor Institutional Trustee.  Upon the resignation of the Institutional
Trustee, the Institutional Trustee shall appoint a successor by requesting from
at least three Persons meeting the eligibility requirements, its expenses and
charges to serve as the successor Institutional Trustee on a form provided by
the Administrators, and selecting the Person who agrees to the lowest expense
and charges (the “Successor Institutional Trustee”).  If the instrument of acceptance by the
Successor Institutional Trustee required by this Section 4.3 shall not have
been delivered to the Institutional Trustee within 60 days after the
giving of such notice of resignation or delivery of the instrument of removal,
the Institutional Trustee may petition, at the expense of the Trust, any
Federal, state or District of Columbia court of competent jurisdiction for the
appointment of a Successor Institutional Trustee.  Such court may thereupon, after prescribing
such notice, if any, as it may deem proper, appoint a Successor Institutional
Trustee.  The Institutional Trustee shall
have no liability for the selection of such successor pursuant to this Section
4.3.


 


The
Institutional Trustee may be removed by the act of the Holders of a Majority in
liquidation amount of the Capital Securities, delivered to the Institutional
Trustee (in its individual capacity and on behalf of the Trust) if an Event of
Default shall have occurred and be continuing. 
If the Institutional Trustee shall be so removed, the Holders of Capital
Securities, by act of the Holders of a Majority in liquidation amount of the
Capital Securities then outstanding delivered to the Institutional Trustee,
shall promptly appoint a Successor Institutional Trustee, and such Successor
Institutional Trustee shall comply with the applicable requirements of this
Section 4.3.  If no Successor
Institutional Trustee shall have been so appointed by the Holders of a Majority
in liquidation amount of the Capital Securities and accepted appointment in the
manner required by this Section 4.3, within 30 days after delivery of an
instrument of removal, any Holder who has been a Holder of the Securities for
at least 6 months may, on behalf of himself and all others similarly
situated, petition any Federal, state or District of Columbia court of
competent jurisdiction for the appointment of the Successor Institutional
Trustee.  Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Institutional Trustee.


 


The
Institutional Trustee shall give notice of its resignation and removal and each
appointment of a Successor Institutional Trustee to all Holders in the manner
provided in Section 13.1(d) and shall give notice to the Sponsor.  Each notice shall include the name of the
Successor Institutional Trustee and the address of its Corporate Trust Office.


 


(b)           In case of the appointment hereunder
of a Successor Institutional Trustee, the retiring Institutional Trustee and
the Successor Institutional Trustee shall execute and deliver an amendment
hereto wherein the Successor Institutional Trustee shall accept such
appointment and which (i) shall contain such provisions as shall be
necessary or desirable to transfer and confirm to, and to vest in, the
Successor Institutional Trustee all the rights, powers, trusts and duties of
the retiring Institutional Trustee with respect to the Securities and the Trust
and (ii) shall add to or change any of the provisions of this


 


20





















 


Declaration as shall be necessary to provide for or facilitate the
administration of the Trust by more than one Institutional Trustee, it being
understood that nothing herein or in such amendment shall constitute such
Institutional Trustees co-trustees and upon the execution and delivery of such
amendment the resignation or removal of the retiring Institutional Trustee
shall become effective to the extent provided therein and each Successor
Institutional Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Institutional Trustee; but, on request of the Trust or any Successor
Institutional Trustee such retiring Institutional Trustee shall duly assign,
transfer and deliver to such Successor Institutional Trustee all Trust
Property, all proceeds thereof and money held by such retiring Institutional
Trustee hereunder with respect to the Securities and the Trust.


 


(c)           No Institutional Trustee shall be
liable for the acts or omissions to act of any Successor Institutional Trustee.


 


(d)           The Holders of the Capital Securities
will have no right to vote to appoint, remove or replace the Administrators,
which voting rights are vested exclusively in the Holder of the Common
Securities.


 


Section 4.4.           Institutional
Trustee Vacancies.  If the
Institutional Trustee ceases to hold office for any reason a vacancy shall
occur.  A resolution certifying the
existence of such vacancy by the Institutional Trustee shall be conclusive
evidence of the existence of such vacancy. 
The vacancy shall be filled with a trustee appointed in accordance with
Section 4.3.


 


Section 4.5.           Effect of Vacancies.  The death, resignation,
retirement, removal, bankruptcy, dissolution, liquidation, incompetence or
incapacity to perform the duties of the Institutional Trustee shall not operate
to dissolve, terminate or annul the Trust or terminate this Declaration.


 


Section 4.6.           Meetings of the
Institutional Trustee and the Administrators.  Meetings of the Administrators
shall be held from time to time upon the call of an Administrator.  Regular meetings of the Administrators may be
held in person in the United States or by telephone, at a place (if applicable)
and time fixed by resolution of the Administrators.  Notice of any in-person meetings of the
Institutional Trustee with the Administrators or meetings of the Administrators
shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 48 hours
before such meeting.  Notice of any
telephonic meetings of the Institutional Trustee with the Administrators or
meetings of the Administrators or any committee thereof shall be hand delivered
or otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 24 hours before a meeting.  Notices shall contain a brief statement of
the time, place and anticipated purposes of the meeting.  The presence (whether in person or by telephone)
of the Institutional Trustee or an Administrator, as the case may be, at a
meeting shall constitute a waiver of notice of such meeting except where the
Institutional Trustee or an Administrator, as the case may be, attends a
meeting for the express purpose of objecting to the transaction of any activity
on the grounds that the meeting has not been lawfully called or convened.  Unless provided otherwise in this
Declaration, any action of the Institutional Trustee or the Administrators, as
the case may be, may be taken at a meeting by vote of the Institutional Trustee
or a majority vote of the Administrators present (whether in person or by
telephone) and eligible to vote with respect to such matter, provided that a
Quorum is present, or without a meeting by the unanimous written consent of the
Institutional Trustee or the Administrators. 
Meetings of the Institutional Trustee and the Administrators together
shall be held from time to time upon the call of the Institutional Trustee or
an Administrator.


 


21





















 


Section 4.7.           Delegation of Power.


 


(a)           Any Administrator may, by power of
attorney consistent with applicable law, delegate to any other natural person
over the age of 21 that is a U.S. Person his or her power for the purpose of
executing any documents contemplated in Section 2.6; and


 


(b)           the Administrators shall have power
to delegate from time to time to such of their number the doing of such things
and the execution of such instruments either in the name of the Trust or the
names of the Administrators or otherwise as the Administrators may deem
expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.


 


Section 4.8.           Conversion,
Consolidation or Succession to Business. 
Any Person into which the Institutional Trustee may be merged
or converted or with which it may be consolidated, or any Person resulting from
any merger, conversion or consolidation to which the Institutional Trustee
shall be a party, or any Person succeeding to all or substantially all the
corporate trust business of the Institutional Trustee shall be the successor of
the Institutional Trustee hereunder, provided such Person 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.


 


ARTICLE V


 


DISTRIBUTIONS


 


Section 5.1.           Distributions.  Holders shall receive
Distributions in accordance with the applicable terms of the relevant Holder’s
Securities. Distributions shall be made on the Capital Securities and the
Common Securities in accordance with the preferences set forth in their
respective terms.  If and to the extent
that the Debenture Issuer makes a payment of Interest or any principal on the
Debentures held by the Institutional Trustee, the Institutional Trustee shall
and is directed, to the extent funds are available for that purpose, to make a
distribution (a “Distribution”) of such amounts to Holders.


 


ARTICLE VI


 


ISSUANCE OF SECURITIES


 


Section 6.1.           General Provisions
Regarding Securities.


 


(a)           The Administrators shall, on behalf
of the Trust, issue one series of capital securities substantially in the form
of Exhibit A-1 representing undivided beneficial interests in the assets
of the Trust having such terms as are set forth in Annex I and one series
of common securities representing undivided beneficial interests in the assets
of the Trust having such terms as are set forth in Annex I.  The Trust shall issue no securities or other
interests in the assets of the Trust other than the Capital Securities and the
Common Securities.  The Capital
Securities rank pari passu to, and payment
thereon shall be made Pro Rata with, the Common Securities except that, where
an Event of Default has occurred and is continuing, the rights of Holders of
the Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment
of the Holders of the Capital Securities as set forth in Annex I.


 


(b)           The Certificates shall be signed on
behalf of the Trust by one or more Administrators. Such signature shall be the
facsimile or manual signature of any Administrator.  In case any Administrator of the Trust who
shall have signed any of the Securities shall cease to be such Administrator
before the Certificates so signed shall be delivered by the Trust, such
Certificates nevertheless may be delivered as


 


22





















 


though the person who signed such Certificates had not ceased to be
such Administrator, and any Certificate may be signed on behalf of the Trust by
such persons who, at the actual date of execution of such Security, shall be an
Administrator of the Trust, although at the date of the execution and delivery
of the Declaration any such person was not such an Administrator.  A Capital Security shall not be valid until
authenticated by the facsimile or manual signature of an Authorized Officer of
the Institutional Trustee.  Such
signature shall be conclusive evidence that the Capital Security has been
authenticated under this Declaration. 
Upon written order of the Trust signed by one Administrator, the
Institutional Trustee shall authenticate the Capital Securities for original
issue.  The Institutional Trustee may
appoint an authenticating agent that is a U.S. Person acceptable to the Trust
to authenticate the Capital Securities. 
A Common Security need not be so authenticated.


 


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


 


(d)           Upon issuance of the Securities as
provided in this Declaration, the Securities so issued shall be deemed to be
validly issued, fully paid and, except as provided in Section 9.1(b) with
respect to the Common Securities, non-assessable.


 


(e)           Every Person, by virtue of having
become a Holder in accordance with the terms of this Declaration, shall be
deemed to have expressly assented and agreed to the terms of, and shall be
bound by, this Declaration and the Guarantee.


 


Section 6.2.           Paying Agent,
Transfer Agent and Registrar.  The
Trust shall maintain in Hartford, Connecticut, an office or agency where the
Capital Securities may be presented for payment (“Paying Agent”), and an
office or agency where Securities may be presented for registration of transfer
or exchange (the “Transfer Agent”). 
The Trust shall keep or cause to be kept at such office or agency a
register for the purpose of registering Securities, transfers and exchanges of
Securities, such register to be held by a registrar (the “Registrar”).  The Administrators may appoint the Paying
Agent, the Registrar and the Transfer Agent and may appoint one or more
additional Paying Agents or one or more co-Registrars, or one or more
co-Transfer Agents in such other locations as it shall determine.  The term “Paying Agent” includes any
additional paying agent, the term “Registrar” includes any additional
registrar or co-Registrar and the term “Transfer Agent” includes any
additional transfer agent.  The
Administrators may change any Paying Agent, Transfer Agent or Registrar at any
time without prior notice to any Holder. 
The Administrators shall notify the Institutional Trustee of the name
and address of any Paying Agent, Transfer Agent and Registrar not a party to
this Declaration.  The Administrators
hereby initially appoint the Institutional Trustee to act as Paying Agent,
Transfer Agent and Registrar for the Capital Securities and the Common
Securities.  The Institutional Trustee or
any of its Affiliates in the United States may act as Paying Agent, Transfer
Agent or Registrar.


 


Section 6.3.           Form and Dating.  The Capital Securities and the Institutional
Trustee’s certificate of authentication thereon shall be substantially in the
form of Exhibit A-1, and the Common Securities shall be substantially in
the form of Exhibit A-2, each of which is hereby incorporated in and
expressly made a part of this Declaration. 
Certificates may be typed, printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Administrators,
as conclusively evidenced by their execution thereof.  The Securities may have letters, numbers,
notations or other marks of identification or designation and such legends or
endorsements required by law, stock exchange rule, agreements to which the
Trust is subject if any, or usage (provided that any such notation, legend or
endorsement is in a form acceptable to the Sponsor).  The Trust at the direction of the Sponsor
shall furnish any such legend not contained in Exhibit A-1 to the
Institutional Trustee in writing.  Each
Capital Security shall be dated on or before the date of its authentication.  The terms and provisions of the Securities
set forth in Annex I and the forms of Securities set forth in Exhibits A-1
and A-2 are part of the


 


23





















 


terms of this Declaration and to the extent applicable, the
Institutional Trustee, the Administrators and the Sponsor, by their execution
and delivery of this Declaration, expressly agree to such terms and provisions
and to be bound thereby.  Capital Securities
will be issued only in blocks having a stated liquidation amount of not less
than $500,000.00 and any multiple of $1,000.00 in excess thereof.


 


The
Capital Securities are being offered and sold by the Trust pursuant to the
Placement Agreement in definitive, registered form without coupons and with the
Restricted Securities Legend.


 


Section 6.4.           Mutilated,
Destroyed, Lost or Stolen Certificates.


 


If:


 


(a)           any mutilated Certificates should be
surrendered to the Registrar, or if the Registrar shall receive evidence to its
satisfaction of the destruction, loss or theft of any Certificate; and


 


(b)           there shall be delivered to the
Registrar, the Administrators and the Institutional Trustee such security or
indemnity as may be required by them to keep each of them harmless;


 


then, in the absence of notice that such Certificate
shall have been acquired by a protected purchaser, an Administrator on behalf
of the Trust shall execute (and in the case of a Capital Security Certificate,
the Institutional Trustee shall authenticate) and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like denomination.  In
connection with the issuance of any new Certificate under this Section 6.4, the
Registrar or the Administrators may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
therewith.  Any duplicate Certificate
issued pursuant to this Section shall constitute conclusive evidence of an
ownership interest in the relevant Securities, as if originally issued, whether
or not the lost, stolen or destroyed Certificate shall be found at any time.


 


Section 6.5.           Temporary
Securities.  Until
definitive Securities are ready for delivery, the Administrators may prepare
and, in the case of the Capital Securities, the Institutional Trustee shall
authenticate, temporary Securities. 
Temporary Securities shall be substantially in the form of definitive
Securities but may have variations that the Administrators consider appropriate
for temporary Securities.  Without
unreasonable delay, the Administrators shall prepare and, in the case of the
Capital Securities, the Institutional Trustee shall authenticate, definitive
Securities in exchange for temporary Securities.


 


Section 6.6.           Cancellation.  The Administrators at any time may
deliver Securities to the Institutional Trustee for cancellation.  The Registrar shall forward to the
Institutional Trustee any Securities surrendered to it for registration of transfer,
redemption or payment.  The Institutional
Trustee shall promptly cancel all Securities surrendered for registration of
transfer, payment, replacement or cancellation and shall dispose of such
canceled Securities as the Administrators direct.  The Administrators may not issue new
Securities to replace Securities that have been paid or that have been
delivered to the Institutional Trustee for cancellation.


 


Section 6.7.           Rights of Holders;
Waivers of Past Defaults.


 


(a)           The
legal title to the Trust Property is vested exclusively in the Institutional
Trustee (in its capacity as such) in accordance with Section 2.5, and the
Holders shall not have any right or title therein other than the undivided
beneficial interest in the assets of the Trust conferred by their Securities
and they shall have no right to call for any partition or division of property,
profits or rights of the Trust except as described below.  The Securities shall be personal property
giving only the rights specifically set forth therein and in this
Declaration.  The Securities shall have
no preemptive or similar rights.


 


24





















 


(b)           For so long as any Capital Securities
remain outstanding, if upon an Indenture Event of Default, the Debenture Trustee
fails or the holders of not less than 25% in principal amount of the
outstanding Debentures fail to declare the principal of all of the Debentures
to be immediately due and payable, the Holders of a Majority in liquidation
amount of the Capital Securities then outstanding shall have the right to make
such declaration by a notice in writing to the Institutional Trustee, the
Sponsor and the Debenture Trustee.


 


At any
time after a declaration of acceleration with respect to the Debentures has
been made and before a judgment or decree for payment of the money due has been
obtained by the Debenture Trustee as provided in the Indenture, if the
Institutional Trustee fails to annul any such declaration and waive such
default, the Holders of a Majority in liquidation amount of the Capital
Securities, by written notice to the Institutional Trustee, the Sponsor and the
Debenture Trustee, may rescind and annul such declaration and its consequences
if:


 


(i)            the Debenture Issuer has paid or
deposited with the Debenture Trustee a sum sufficient to pay


 


(A)  all overdue installments of interest on all
of the Debentures,


 


(B)  any accrued Additional Interest on all of the
Debentures,


 


(C)  the principal of (and premium, if any, on)
any Debentures that have become due otherwise than by such declaration of
acceleration and interest and Additional Interest thereon at the rate borne by
the Debentures, and


 


(D)  all sums paid or advanced by the Debenture
Trustee under the Indenture and the reasonable compensation, expenses, disbursements
and advances of the Debenture Trustee and the Institutional Trustee, their
agents and counsel; and


 


(ii)           all Events of Default with respect to
the Debentures, other than the non-payment of the principal of the Debentures
that has become due solely by such acceleration, have been cured or waived as
provided in Section 5.7 of the Indenture.


 


The
Holders of at least a Majority in liquidation amount of the Capital Securities
may, on behalf of the Holders of all the Capital Securities, waive any past default
or Event of Default, except a default or Event of Default in the payment of
principal or interest (unless such default or Event of Default has been cured
and a sum sufficient to pay all matured installments of interest and principal
due otherwise than by acceleration has been deposited with the Debenture
Trustee) or a default or Event of Default in respect of a covenant or provision
that under the Indenture cannot be modified or amended without the consent of
the holder of each outstanding Debenture. 
No such rescission shall affect any subsequent default or impair any
right consequent thereon.


 


Upon
receipt by the Institutional Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of any part of the
Capital Securities, a record date shall be established for determining Holders
of outstanding Capital Securities entitled to join in such notice, which record
date shall be at the close of business on the day the Institutional Trustee
receives such notice.  The Holders on
such record date, or their duly designated proxies, and only such Persons,
shall be entitled to join in such notice, whether or not such Holders remain
Holders after such record date; provided, that unless such declaration
of acceleration, or rescission and annulment, as the case may be, shall have
become effective by virtue of the requisite percentage having joined in such
notice prior to the day that is 90 days after such record date, such
notice of declaration of acceleration, or rescission and annulment, as the case
may be, shall automatically and without further action by any Holder be
canceled and of no


 


25





















 


further effect.  Nothing in this
paragraph shall prevent a Holder, or a proxy of a Holder, from giving, after
expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice that has been canceled pursuant to the proviso to
the preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 6.7.


 


(c)           Except as otherwise provided in
paragraphs (a) and (b) of this Section 6.7, the Holders of at least a
Majority in liquidation amount of the Capital Securities may, on behalf of the
Holders of all the Capital Securities, waive any past default or Event of
Default and its consequences.  Upon such
waiver, any such default or Event of Default shall cease to exist, and any default
or Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.


 


ARTICLE VII


 


DISSOLUTION AND TERMINATION OF
TRUST


 


Section 7.1.           Dissolution and
Termination of Trust.


 


(a)           The Trust shall dissolve on the first
to occur of:


 


(i)            unless earlier dissolved, on
December 18, 2036, the expiration of the term of the Trust;


 


(ii)           upon a Bankruptcy Event with respect
to the Sponsor, the Trust or the Debenture Issuer;


 


(iii)          (other than in connection with a
merger, consolidation or similar transaction not prohibited by the Indenture,
this Declaration or the Guarantee, as the case may be) upon the filing of a
certificate of dissolution or its equivalent with respect to the Sponsor, upon
the consent of Holders of a Majority in liquidation amount of the Securities
voting together as a single class to file a certificate of cancellation with
respect to the Trust or upon the revocation of the charter of the Sponsor and
the expiration of 90 days after the date of revocation without a
reinstatement thereof;


 


(iv)          upon the distribution of the
Debentures to the Holders of the Securities;


 


(v)           upon exercise of the right of the
Holder of all of the outstanding Common Securities to dissolve the Trust as
provided in Annex I hereto;


 


(vi)          upon the entry of a decree of judicial
dissolution of the Holder of the Common Securities, the Sponsor, the Trust or
the Debenture Issuer;


 


(vii)         when all of the Securities shall have
been called for redemption and the amounts necessary for redemption thereof
shall have been paid to the Holders in accordance with the terms of the
Securities; or


 


(viii)        before the issuance of any Securities,
with the consent of the Institutional Trustee and the Sponsor.


 


26





















 


(b)           As soon as is practicable after the
occurrence of an event referred to in Section 7.1(a), and after satisfaction of
liabilities to creditors of the Trust as required by applicable law, including
of the Statutory Trust Act, and subject to the terms set forth in Annex I,
the Institutional Trustee shall terminate the Trust by filing a certificate of
cancellation with the Secretary of State of the State of Connecticut.


 


(c)           The provisions of Section 2.9
and Article IX shall survive the termination of the Trust.


 


ARTICLE VIII


 


TRANSFER OF INTERESTS


 


Section 8.1.           General.


 


(a)           Subject to Section 8.1(c), where
Capital Securities are presented to the Registrar or a co-registrar with a
request to register a transfer or to exchange them for an equal number of
Capital Securities represented by different certificates, the Registrar shall
register the transfer or make the exchange if its requirements for such
transactions are met.  To permit
registrations of transfer and exchanges, the Trust shall issue and the
Institutional Trustee shall authenticate Capital Securities at the Registrar’s
request.


 


(b)           Upon issuance of the Common Securities,
the Sponsor shall acquire and retain beneficial and record ownership of the
Common Securities and for so long as the Securities remain outstanding, the
Sponsor shall maintain 100% ownership of the Common Securities; provided,
however, that any permitted successor of the Sponsor, in its capacity as
Debenture Issuer, under the Indenture that is a U.S. Person may succeed to the
Sponsor’s ownership of the Common Securities.


 


(c)           Capital Securities may only be
transferred, in whole or in part, in accordance with the terms and conditions
set forth in this Declaration and in the terms of the Securities.  To the fullest extent permitted by applicable
law, any transfer or purported transfer of any Security not made in accordance
with this Declaration shall be null and void and will be deemed to be of no
legal effect whatsoever and any such transferee shall be deemed not to be the
holder of such Capital Securities for any purpose, including but not limited to
the receipt of Distributions on such Capital Securities, and such transferee
shall be deemed to have no interest whatsoever in such Capital Securities.


 


(d)           The Registrar shall provide for the
registration of Securities and of transfers of Securities, which will be
effected without charge but only upon payment (with such indemnity as the
Registrar may require) in respect of any tax or other governmental charges that
may be imposed in relation to it.  Upon
surrender for registration of transfer of any Securities, the Registrar shall
cause one or more new Securities of the same tenor to be issued in the name of
the designated transferee or transferees. 
Every Security surrendered for registration of transfer shall be
accompanied by a written instrument of transfer in form satisfactory to the
Registrar duly executed by the Holder or such Holder’s attorney duly authorized
in writing.  Each Security surrendered
for registration of transfer shall be canceled by the Institutional Trustee
pursuant to Section 6.6.  A transferee of
a Security shall be entitled to the rights and subject to the obligations of a
Holder hereunder upon the receipt by such transferee of a Security.  By acceptance of a Security, each transferee
shall be deemed to have agreed to be bound by this Declaration.


 


(e)           The Trust shall not be required
(i) to issue, register the transfer of, or exchange any Securities during
a period beginning at the opening of business 15 days before the day of
any selection of Securities for redemption and ending at the close of business
on the earliest date on which the relevant notice of redemption is deemed to
have been given to all Holders of the Securities to be redeemed, or
(ii) to register the transfer or exchange of any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part.


 


27





















 


Section 8.2.           Transfer Procedures
and Restrictions.


 


(a)           The Capital Securities shall bear the
Restricted Securities Legend, which shall not be removed unless there is
delivered to the Trust such satisfactory evidence, which may include an opinion
of counsel licensed to practice law in the State of Connecticut, as may be
reasonably required by the Trust, that neither the legend nor the restrictions
on transfer set forth therein are required to ensure that transfers thereof
comply with the provisions of the Securities Act.  Upon provision of such satisfactory evidence,
the Institutional Trustee, at the written direction of the Trust, shall authenticate
and deliver Capital Securities that do not bear the legend.


 


(b)           Except as permitted by Section
8.2(a), each Capital Security shall bear a legend (the “Restricted
Securities Legend”) in substantially the following form and a Capital
Security shall not be transferred except in compliance with such legend, unless
otherwise determined by the Sponsor, upon the advice of counsel expert in
securities law, in accordance with applicable law:


 


THIS SECURITY HAS
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW.  NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES
LAWS.  THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY
ONLY (A) TO THE SPONSOR OR THE TRUST, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT,
(C) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A
SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A IN
ACCORDANCE WITH RULE 144A, (D) TO A NON-U.S. PERSON IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE)
OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF RULE 501 UNDER
THE SECURITIES ACT THAT IS ACQUIRING THIS CAPITAL SECURITY FOR ITS OWN ACCOUNT,
OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE SPONSOR’S AND THE TRUST’S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM IN
ACCORDANCE WITH THE DECLARATION OF TRUST, A COPY OF WHICH MAY BE OBTAINED FROM
THE SPONSOR OR THE TRUST.  HEDGING
TRANSACTIONS INVOLVING THIS SECURITY MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE
WITH THE SECURITIES ACT.


 


28





















 


THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IT
IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR
ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY,
AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THE
SECURITIES OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE
FOR EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER
APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS NOT
PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO
SUCH PURCHASE OR HOLDING.  ANY PURCHASER
OR HOLDER OF THE SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE
REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS NOT AN
EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO
WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING
ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY
USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE,
OR (ii) SUCH PURCHASE WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION
406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE
STATUTORY OR ADMINISTRATIVE EXEMPTION.


 


THIS SECURITY WILL
BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A LIQUIDATION AMOUNT OF
NOT LESS THAN $500,000.00 (500 SECURITIES) AND MULTIPLES OF $1,000.00 IN EXCESS
THEREOF.  ANY ATTEMPTED TRANSFER OF
SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS THAN $500,000.00
SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER.


 


THE HOLDER OF THIS
SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.


 


(c)           To permit registrations of transfers
and exchanges, the Trust shall execute and the Institutional Trustee shall
authenticate Capital Securities at the Registrar’s request.


 


(d)           Registrations of transfers or
exchanges will be effected without charge, but only upon payment (with such
indemnity as the Registrar or the Sponsor may require) in respect of any tax or
other governmental charge that may be imposed in relation to it.


 


(e)           All Capital Securities issued upon
any registration of transfer or exchange pursuant to the terms of this
Declaration shall evidence the same security and shall be entitled to the same
benefits under this Declaration as the Capital Securities surrendered upon such
registration of transfer or exchange.


 


Section 8.3.           Deemed Security
Holders.  The Trust, the
Administrators, the Institutional Trustee, the Paying Agent, the Transfer Agent
or the Registrar may treat the Person in whose name any Certificate shall be
registered on the books and records of the Trust as the sole holder of such
Certificate


 


29





















 


and of the Securities represented by such Certificate for purposes of
receiving Distributions and for all other purposes whatsoever and, accordingly,
shall not be bound to recognize any equitable or other claim to or interest in
such Certificate or in the Securities represented by such Certificate on the
part of any Person, whether or not the Trust, the Administrators, the
Institutional Trustee, the Paying Agent, the Transfer Agent or the Registrar
shall have actual or other notice thereof


 


ARTICLE IX


 


LIMITATION OF LIABILITY OF

HOLDERS OF SECURITIES, INSTITUTIONAL TRUSTEE OR OTHERS


 


Section 9.1.           Liability.


 


(a)           Except as expressly set forth in this
Declaration, the Guarantee and the terms of the Securities, the Sponsor shall
not be:


 


(i)            personally liable for the return of
any portion of the capital contributions (or any return thereon) of the Holders
of the Securities which shall be made solely from assets of the Trust; or


 


(ii)           required to pay to the Trust or to
any Holder of the Securities any deficit upon dissolution of the Trust or
otherwise.


 


(b)           The Holder of the Common Securities
shall be liable for all of the debts and obligations of the Trust (other than
with respect to the Securities) to the extent not satisfied out of the Trust’s
assets.


 


(c)           Pursuant to the Statutory Trust Act,
the Holders of the Capital Securities shall be entitled to the same limitation
of personal liability extended to stockholders of private corporations for
profit organized under the General Corporation Law of the State of Connecticut.


 


Section 9.2.           Exculpation.


 


(a)           No Indemnified Person shall be
liable, responsible or accountable in damages or otherwise to the Trust or any
Covered Person for any loss, damage or claim incurred by reason of any act or
omission performed or omitted by such Indemnified Person in good faith on
behalf of the Trust and in a manner such Indemnified Person reasonably believed
to be within the scope of the authority conferred on such Indemnified Person by
this Declaration or by law, except that an Indemnified Person shall be liable
for any such loss, damage or claim incurred by reason of such Indemnified
Person’s negligence or willful misconduct with respect to such acts or
omissions.


 


(b)           An Indemnified Person shall be fully
protected in relying in good faith upon the records of the Trust and upon such
information, opinions, reports or statements presented to the Trust by any
Person as to matters the Indemnified Person reasonably believes are within such
other Person’s professional or expert competence and, if selected by such
Indemnified Person, has been selected by such Indemnified Person with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distributions to Holders of Securities might properly be
paid.


 


30





















 


Section 9.3.           Fiduciary Duty.


 


(a)           To the extent that, at law or in
equity, an Indemnified Person has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or to any other Covered Person, an
Indemnified Person acting under this Declaration shall not be liable to the
Trust or to any other Covered Person for its good faith reliance on the
provisions of this Declaration.  The
provisions of this Declaration, to the extent that they restrict the duties and
liabilities of an Indemnified Person otherwise existing at law or in equity,
are agreed by the parties hereto to replace such other duties and liabilities
of the Indemnified Person.


 


(b)           Whenever in this Declaration an
Indemnified Person is permitted or required to make a decision:


 


(i)            in its “discretion” or under a grant
of similar authority, the Indemnified Person shall be entitled to consider such
interests and factors as it desires, including its own interests, and shall
have no duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or


 


(ii)           in its “good faith” or under another
express standard, the Indemnified Person shall act under such express standard
and shall not be subject to any other or different standard imposed by this
Declaration or by applicable law.


 


Section 9.4.           Indemnification.


 


(a)           The Sponsor shall indemnify, to the
full extent permitted by law, any Indemnified Person who was or is a party or
is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Trust) arising
out of or in connection with the acceptance or administration of this
Declaration by reason of the fact that he is or was an Indemnified Person
against expenses (including reasonable attorneys’ fees and expenses),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Trust, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.  The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the Indemnified Person did not act in good faith and
in a manner which he reasonably believed to be in or not opposed to the best
interests of the Trust, and, with respect to any criminal action or proceeding,
had reasonable cause to believe that his conduct was unlawful.


 


(b)           The Sponsor shall indemnify, to the
full extent permitted by law, any Indemnified Person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action
or suit by or in the right of the Trust to procure a judgment in its favor
arising out of or in connection with the acceptance or administration of this
Declaration by reason of the fact that he is or was an Indemnified Person
against expenses (including reasonable attorneys’ fees and expenses) actually
and reasonably incurred by him in connection with the defense or settlement of
such action or suit if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Trust; provided,
however, that no such indemnification shall be made in respect of any
claim, issue or matter as to which such Indemnified Person shall have been
adjudged to be liable to the Trust unless and only to the extent that the court
in which such action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which such court shall deem proper.


 


31





















 


(c)           To the extent that an Indemnified
Person shall be successful on the merits or otherwise (including dismissal of
an action without prejudice or the settlement of an action without admission of
liability) in defense of any action, suit or proceeding referred to in
paragraphs (a) and (b) of this Section 9.4, or in defense of any claim,
issue or matter therein, he shall be indemnified, to the full extent permitted
by law, against expenses (including attorneys’ fees and expenses) actually and
reasonably incurred by him in connection therewith.


 


(d)           Any indemnification of an
Administrator under paragraphs (a) and (b) of this Section 9.4 (unless
ordered by a court) shall be made by the Sponsor only as authorized in the
specific case upon a determination that indemnification of the Indemnified
Person is proper in the circumstances because he has met the applicable
standard of conduct set forth in paragraphs (a) and (b).  Such determination shall be made (i) by
the Administrators by a majority vote of a Quorum consisting of such
Administrators who were not parties to such action, suit or proceeding,
(ii) if such a Quorum is not obtainable, or, even if obtainable, if a
Quorum of disinterested Administrators so directs, by independent legal counsel
in a written opinion, or (iii) by the Common Security Holder of the Trust.


 


(e)           To the fullest extent permitted by
law, expenses (including reasonable attorneys’ fees and expenses) incurred by
an Indemnified Person in defending a civil, criminal, administrative or investigative
action, suit or proceeding referred to in paragraphs (a) and (b) of this
Section 9.4 shall be paid by the Sponsor in advance of the final disposition of
such action, suit or proceeding upon receipt of an undertaking by or on behalf
of such Indemnified Person to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the Sponsor as
authorized in this Section 9.4. 
Notwithstanding the foregoing, no advance shall be made by the Sponsor
if a determination is reasonably and promptly made (i) by the
Administrators by a majority vote of a Quorum of disinterested Administrators,
(ii) if such a Quorum is not obtainable, or, even if obtainable, if a
quorum of disinterested Administrators so directs, by independent legal counsel
in a written opinion or (iii) by the Common Security Holder of the Trust,
that, based upon the facts known to the Administrators, counsel or the Common
Security Holder at the time such determination is made, such Indemnified Person
acted in bad faith or in a manner that such Indemnified Person did not believe
to be in the best interests of the Trust, or, with respect to any criminal
proceeding, that such Indemnified Person believed or had reasonable cause to
believe his conduct was unlawful.  In no
event shall any advance be made in instances where the Administrators,
independent legal counsel or the Common Security Holder reasonably determine
that such Indemnified Person deliberately breached his duty to the Trust or its
Common or Capital Security Holders.


 


(f)            The Institutional Trustee, at the
sole cost and expense of the Sponsor, retains the right to representation by
counsel of its own choosing in any action, suit or any other proceeding for
which it is indemnified under paragraphs (a) and (b) of this Section 9.4,
without affecting its right to indemnification hereunder or waiving any rights
afforded to it under this Declaration or applicable law.


 


(g)           The indemnification and advancement
of expenses provided by, or granted pursuant to, the other paragraphs of this
Section 9.4 shall not be deemed exclusive of any other rights to which those
seeking indemnification and advancement of expenses may be entitled under any
agreement, vote of stockholders or disinterested directors of the Sponsor or Capital
Security Holders of the Trust or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office.  All rights to indemnification under this
Section 9.4 shall be deemed to be provided by a contract between the
Sponsor and each Indemnified Person who serves in such capacity at any time
while this Section 9.4 is in effect.  Any
repeal or modification of this Section 9.4 shall not affect any rights or
obligations then existing.


 


32





















 


(h)           The Sponsor or the Trust may purchase
and maintain insurance on behalf of any Person who is or was an Indemnified
Person against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the Sponsor
would have the power to indemnify him against such liability under the
provisions of this Section 9.4.


 


(i)            For purposes of this Section 9.4,
references to “the Trust” shall include, in addition to the resulting or
surviving entity, any constituent entity (including any constituent of a
constituent) absorbed in a consolidation or merger, so that any Person who is
or was a director, trustee, officer or employee of such constituent entity, or
is or was serving at the request of such constituent entity as a director,
trustee, officer, employee or agent of another entity, shall stand in the same
position under the provisions of this Section 9.4 with respect to the resulting
or surviving entity as he would have with respect to such constituent entity if
its separate existence had continued.


 


(j)            The indemnification and advancement
of expenses provided by, or granted pursuant to, this Section 9.4 shall, unless
otherwise provided when authorized or ratified, (i) continue as to a
Person who has ceased to be an Indemnified Person and shall inure to the
benefit of the heirs, executors and administrators of such a Person; and
(ii) survive the termination or expiration of this Declaration or the
earlier removal or resignation of an Indemnified Person.


 


Section 9.5.           Outside Businesses.  Any Covered Person, the Sponsor
and the Institutional Trustee may engage in or possess an interest in other
business ventures of any nature or description, independently or with others,
similar or dissimilar to the business of the Trust, and the Trust and the
Holders of Securities shall have no rights by virtue of this Declaration in and
to such independent ventures or the income or profits derived therefrom, and
the pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper.  None of any Covered Person, the Sponsor or
the Institutional Trustee shall be obligated to present any particular investment
or other opportunity to the Trust even if such opportunity is of a character
that, if presented to the Trust, could be taken by the Trust, and any Covered
Person, the Sponsor and the Institutional Trustee shall have the right to take
for its own account (individually or as a partner or fiduciary) or to recommend
to others any such particular investment or other opportunity.  Any Covered Person and the Institutional
Trustee may engage or be interested in any financial or other transaction with
the Sponsor or any Affiliate of the Sponsor, or may act as depositary for,
trustee or agent for, or act on any committee or body of holders of, securities
or other obligations of the Sponsor or its Affiliates.


 


Section 9.6.           Compensation; Fee.  The Sponsor agrees:


 


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


 


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


 


The
provisions of this Section 9.6 shall survive the dissolution of the Trust and
the termination of this Declaration and the removal or resignation of the
Institutional Trustee.


 


No
Trustee may claim any lien or charge on any property of the Trust as a result
of any amount due pursuant to this Section 9.6.


 


33





















 


ARTICLE X


 


ACCOUNTING


 


Section 10.1.        Fiscal Year.  The fiscal year (“Fiscal Year”)
of the Trust shall be the calendar year, or such other year as is required by the
Code.


 


Section 10.2.        Certain Accounting
Matters.


 


(a)           At all times during the existence of
the Trust, the Administrators shall keep, or cause to be kept at the principal
office of the Trust in the United States, as defined for purposes of Treasury
Regulations section 301.7701-7, full books of account, records and supporting
documents, which shall reflect in reasonable detail each transaction of the
Trust.  The books of account shall be
maintained, at the Sponsor’s expense, in accordance with generally accepted
accounting principles, consistently applied. 
The books of account and the records of the Trust shall be examined by
and reported upon as of the end of each Fiscal Year of the Trust by a firm of
independent certified public accountants selected by the Administrators.


 


(b)           The Administrators shall cause to be
duly prepared and delivered to each of the Holders of Securities Form 1099 or
such other annual United States federal income tax information statement
required by the Code, containing such information with regard to the Securities
held by each Holder as is required by the Code and the Treasury
Regulations.  Notwithstanding any right
under the Code to deliver any such statement at a later date, the Administrators
shall endeavor to deliver all such statements within 30 days after the end
of each Fiscal Year of the Trust.


 


(c)           The Administrators, at the Sponsor’s
expense, shall cause to be duly prepared at the principal office of the Trust
in the United States, as defined for purposes of Treasury Regulations section
301.7701-7, and filed an annual United States federal income tax return on a
Form 1041 or such other form required by United States federal income tax
law, and any other annual income tax returns required to be filed by the
Administrators on behalf of the Trust with any state or local taxing authority.


 


Section 10.3.        Banking.  The Trust shall maintain in the
United States, as defined for purposes of Treasury Regulations section
301.7701-7, one or more bank accounts in the name and for the sole benefit of
the Trust; provided, however, that all payments of funds in
respect of the Debentures held by the Institutional Trustee shall be made
directly to the Property Account and no other funds of the Trust shall be
deposited in the Property Account.  The
sole signatories for such accounts (including the Property Account) shall be
designated by the Institutional Trustee.


 


Section 10.4.        Withholding.  The Institutional Trustee or any
Paying Agent and the Administrators shall comply with all withholding
requirements under United States federal, state and local law.  The Institutional Trustee or any Paying Agent
shall request, and each Holder shall provide to the Institutional Trustee or
any Paying Agent, such forms or certificates as are necessary to establish an
exemption from withholding with respect to the Holder, and any representations
and forms as shall reasonably be requested by the Institutional Trustee or any
Paying Agent to assist it in determining the extent of, and in fulfilling, its
withholding obligations.  The
Administrators shall file required forms with applicable jurisdictions and,
unless an exemption from withholding is properly established by a Holder, shall
remit amounts withheld with respect to the Holder to applicable jurisdictions.  To the extent that the Institutional Trustee
or any Paying Agent is required to withhold and pay over any amounts to any
authority with respect to distributions or allocations to any Holder, the
amount withheld shall be deemed to be a Distribution in the amount of the
withholding to the Holder.  In the event
of any claimed overwithholding, Holders shall be limited to an action against
the applicable jurisdiction.  If the
amount


 


34





















 


required to be withheld was not withheld from actual Distributions
made, the Institutional Trustee or any Paying Agent may reduce subsequent
Distributions by the amount of such withholding.


 


ARTICLE XI


 


AMENDMENTS AND MEETINGS


 


Section 11.1.        Amendments.


 


(a)           Except as otherwise provided in this
Declaration or by any applicable terms of the Securities, this Declaration may
only be amended by a written instrument approved and executed by the
Institutional Trustee.


 


(b)           Notwithstanding any other provision
of this Article XI, an amendment may be made, and any such purported
amendment shall be valid and effective only if:


 


(i)            the Institutional Trustee shall have
first received


 


(A)  an Officers’ Certificate from each of the
Trust and the Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities); and


 


(B)  an opinion of counsel (who may be counsel to
the Sponsor or the Trust) that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the Securities); and


 


(ii)           the result of such amendment would
not be to


 


(A)  cause the Trust to cease to be classified for
purposes of United States federal income taxation as a grantor trust; or


 


(B)  cause the Trust to be deemed to be an
Investment Company required to be registered under the Investment Company Act.


 


(c)           Except as provided in Section
11.1(d), (e) or (h), no amendment shall be made, and any such purported
amendment shall be void and ineffective unless the Holders of a Majority in
liquidation amount of the Capital Securities shall have consented to such
amendment.


 


(d)           In addition to and notwithstanding
any other provision in this Declaration, without the consent of each affected
Holder, this Declaration may not be amended to (i) change the amount or
timing of any Distribution on the Securities or otherwise adversely affect the
amount of any Distribution required to be made in respect of the Securities as
of a specified date or change any conversion or exchange provisions or (ii) restrict
the right of a Holder to institute suit for the enforcement of any such payment
on or after such date.


 


(e)           Section 8.1 (b) and 8.1(c) and this
Section 11.1 shall not be amended without the consent of all of the Holders of
the Securities.


 


(f)            Article III shall not be
amended without the consent of the Holders of a Majority in liquidation amount
of the Common Securities.


 


35





















 


(g)           The rights of the Holders of the
Capital Securities under Article IV to appoint and remove the
Institutional Trustee shall not be amended without the consent of the Holders
of a Majority in liquidation amount of the Capital Securities.


 


(h)           This Declaration may be amended by
the Institutional Trustee and the Holders of a Majority in liquidation amount
of the Common Securities without the consent of the Holders of the Capital
Securities to:


 


(i)            cure any ambiguity;


 


(ii)           correct or supplement any provision
in this Declaration that may be defective or inconsistent with any other
provision of this Declaration;


 


(iii)          add to the covenants, restrictions or
obligations of the Sponsor; or


 


(iv)          modify, eliminate or add to any
provision of this Declaration to such extent as may be necessary to ensure that
the Trust will be classified for United States federal income tax purposes at
all times as a grantor trust and will not be required to register as an “investment
company” under the Investment Company Act (including without limitation to
conform to any change in Rule 3a-5, Rule 3a-7 or any other applicable
rule under the Investment Company Act or written change in interpretation or
application thereof by any legislative body, court, government agency or
regulatory authority) which amendment does not have a material adverse effect
on the rights, preferences or privileges of the Holders of Securities;


 


provided,
however, that no such modification, elimination or addition referred to
in clauses (i), (ii) or (iii) shall adversely affect in any material
respect the powers, preferences or special rights of Holders of Capital
Securities.


 


Section 11.2.        Meetings of the
Holders of Securities; Action by Written Consent.


 


(a)           Meetings of the Holders of any class
of Securities may be called at any time by the Administrators (or as provided
in the terms of the Securities) to consider and act on any matter on which
Holders of such class of Securities are entitled to act under the terms of this
Declaration or the terms of the Securities. 
The Administrators shall call a meeting of the Holders of such class if
directed to do so by the Holders of at least 10% in liquidation amount of such
class of Securities.  Such direction
shall be given by delivering to the Administrators one or more calls in a
writing stating that the signing Holders of the Securities wish to call a
meeting and indicating the general or specific purpose for which the meeting is
to be called.  Any Holders of the
Securities calling a meeting shall specify in writing the Certificates held by
the Holders of the Securities exercising the right to call a meeting and only
those Securities represented by such Certificates shall be counted for purposes
of determining whether the required percentage set forth in the second sentence
of this paragraph has been met.


 


(b)           Except to the extent otherwise
provided in the terms of the Securities, the following provisions shall apply
to meetings of Holders of the Securities:


 


(i)            notice of any such meeting shall be
given to all the Holders of the Securities having a right to vote thereat at
least 7 days and not more than 60 days before the date of such
meeting.  Whenever a vote, consent or
approval of the Holders of the Securities is permitted or required under this
Declaration, such vote, consent or approval may be given at a meeting of the
Holders of the Securities.  Any action
that may be taken at a meeting of the Holders of the Securities may be taken
without a meeting if a consent in writing setting forth the action so taken is
signed by the Holders of the Securities owning not less than the minimum amount
of Securities


 


36





















 


in liquidation
amount that would be necessary to authorize or take such action at a meeting at
which all Holders of the Securities having a right to vote thereon were present
and voting.  Prompt notice of the taking
of action without a meeting shall be given to the Holders of the Securities
entitled to vote who have not consented in writing.  The Administrators may specify that any
written ballot submitted to the Holders of the Securities for the purpose of
taking any action without a meeting shall be returned to the Trust within the
time specified by the Administrators;


 


(ii)           each Holder of a Security may
authorize any Person to act for it by proxy on all matters in which a Holder of
Securities is entitled to participate, including waiving notice of any meeting,
or voting or participating at a meeting. No proxy shall be valid after the
expiration of 11 months from the date thereof unless otherwise provided in
the proxy.  Every proxy shall be
revocable at the pleasure of the Holder of the Securities executing it.  Except as otherwise provided herein, all
matters relating to the giving, voting or validity of proxies shall be governed
by the General Corporation Law of the State of Connecticut relating to proxies,
and judicial interpretations thereunder, as if the Trust were a Connecticut
corporation and the Holders of the Securities were stockholders of a
Connecticut corporation; each meeting of the Holders of the Securities shall be
conducted by the Administrators or by such other Person that the Administrators
may designate; and


 


(iii)          unless the Statutory Trust Act, this
Declaration, or the terms of the Securities otherwise provides, the
Administrators, in their sole discretion, shall establish all other provisions
relating to meetings of Holders of Securities, including notice of the time,
place or purpose of any meeting at which any matter is to be voted on by any
Holders of the Securities, waiver of any such notice, action by consent without
a meeting, the establishment of a record date, quorum requirements, voting in
person or by proxy or any other matter with respect to the exercise of any such
right to vote; provided, however, that each meeting shall be
conducted in the United States (as that term is defined in Treasury Regulations
section 301.7701-7).


 


ARTICLE XII


 


REPRESENTATIONS OF INSTITUTIONAL
TRUSTEE


 


Section 12.1.        Representations and
Warranties of Institutional Trustee. 
The initial Institutional Trustee represents and warrants to the
Trust and to the Sponsor at the date of this Declaration, and each Successor
Institutional Trustee represents and warrants to the Trust and the Sponsor at
the time of the Successor Institutional Trustee’s acceptance of its appointment
as Institutional Trustee, that:


 


(a)           the Institutional Trustee is a
national banking association with trust powers, duly organized and validly
existing under the laws of the United States of America with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, this Declaration;


 


(b)           the execution, delivery and
performance by the Institutional Trustee of this Declaration has been duly
authorized by all necessary corporate action on the part of the Institutional
Trustee.  This Declaration has been duly
executed and delivered by the Institutional Trustee, and it constitutes a
legal, valid and binding obligation of the Institutional Trustee, enforceable
against it in accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency, and other similar laws affecting
creditors’ rights generally and to general principles of equity (regardless of
whether considered in a proceeding in equity or at law);


 


37





















 


(c)           the execution, delivery and
performance of this Declaration by the Institutional Trustee does not conflict
with or constitute a breach of the charter or by-laws of the Institutional
Trustee; and


 


(d)           no consent, approval or authorization
of, or registration with or notice to, any state or federal banking authority
is required for the execution, delivery or performance by the Institutional
Trustee of this Declaration.


 


ARTICLE XIII


 


MISCELLANEOUS


 


Section 13.1.        Notices.  All notices provided for in this
Declaration shall be in writing, duly signed by the party giving such notice,
and shall be delivered, telecopied (which telecopy shall be followed by notice
delivered or mailed by first class mail) or mailed by first class mail, as
follows:


 


(a)           if given to the Trust in care of the
Administrators at the Trust’s mailing address set forth below (or such other
address as the Trust may give notice of to the Holders of the Securities):


 


	
  c/o First Regional Bancorp

  
	
  1801 Century Park East

  
	
  Los Angeles, California 90067-2302

  
	
  Attention: Tom McCullough

  
	
  Telecopy: 310-552-1772

  



 


(b)           if given to the Institutional
Trustee, at the Institutional Trustee’s mailing address set forth below (or
such other address as the Institutional Trustee may give notice of to the
Holders of the Securities):


 


	
  State Street Bank and Trust Company of Connecticut,
  National Association

  
	
  225 Asylum Street, Goodwin Square

  
	
  Hartford, Connecticut 06103

  
	
  Attention: Vice President, Corporate Trust
  Department

  
	
  Telecopy: 860-244-1889

  
	
   

  
	
  With a copy to:

  
	
   

  
	
  State Street Bank and Trust Company

  
	
  P.O. Box 778

  
	
  Boston, Massachusetts 02102-0778

  
	
  Attention: Paul D. Allen, Corporate Trust Department

  
	
  Telecopy: 617-662-1462

  



 


(c)           if given to the Holder of the Common
Securities, at the mailing address of the Sponsor set forth below (or such
other address as the Holder of the Common Securities may give notice of to the
Trust):


 


	
  First Regional Bancorp

  
	
  1801 Century Park East

  
	
  Los Angeles, California 90067-2302

  
	
  Attention: Tom McCullough

  
	
  Telecopy: 310-552-1772

  



 


38





















 


(d)           if given to any other Holder, at the
address set forth on the books and records of the Trust.


 


All
such notices shall be deemed to have been given when received in person,
telecopied with receipt confirmed, or mailed by first class mail, postage
prepaid except that if a notice or other document is refused delivery or cannot
be delivered because of a changed address of which no notice was given, such
notice or other document shall be deemed to have been delivered on the date of
such refusal or inability to deliver.


 


Section 13.2.        Governing Law.  This Declaration and the rights of
the parties hereunder shall be governed by and interpreted in accordance with
the law of the State of Connecticut and all rights and remedies shall be
governed by such laws without regard to the principles of conflict of laws of
the State of Connecticut or any other jurisdiction that would call for the
application of the law of any jurisdiction other than the State of Connecticut;
provided, however, that there shall not be applicable to the
Trust, the Institutional Trustee or this Declaration any provision of the laws
(statutory or common) of the State of Connecticut pertaining to trusts that
relate to or regulate, in a manner inconsistent with the terms hereof
(a) the filing with any court or governmental body or agency of trustee
accounts or schedules of trustee fees and charges, (b) affirmative
requirements to post bonds for trustees, officers, agents or employees of a trust,
(c) the necessity for obtaining court or other governmental approval
concerning the acquisition, holding or disposition of real or personal
property, (d) fees or other sums payable to trustees, officers, agents or
employees of a trust, (e) the allocation of receipts and expenditures to
income or principal, or (f) restrictions or limitations on the permissible
nature, amount or concentration of trust investments or requirements relating
to the titling, storage or other manner of holding or investing trust assets.


 


Section 13.3.        Intention of the
Parties.  It is the
intention of the parties hereto that the Trust be classified for United States
federal income tax purposes as a grantor trust. The provisions of this
Declaration shall be interpreted to further this intention of the parties.


 


Section 13.4.        Headings.  Headings contained in this
Declaration are inserted for convenience of reference only and do not affect
the interpretation of this Declaration or any provision hereof.


 


Section 13.5.        Successors and Assigns.  Whenever in this Declaration any
of the parties hereto is named or referred to, the successors and assigns of
such party shall be deemed to be included, and all covenants and agreements in
this Declaration by the Sponsor and the Institutional Trustee shall bind and
inure to the benefit of their respective successors and assigns, whether or not
so expressed.


 


Section 13.6.        Partial Enforceability.  If any provision of this
Declaration, or the application of such provision to any Person or circumstance,
shall be held invalid, the remainder of this Declaration, or the application of
such provision to persons or circumstances other than those to which it is held
invalid, shall not be affected thereby.


 


Section 13.7.        Counterparts.  This Declaration may contain more
than one counterpart of the signature page and this Declaration may be executed
by the affixing of the signature of each of the Institutional Trustee and
Administrators to any of such counterpart signature pages.  All of such counterpart signature pages shall
be read as though one, and they shall have the same force and effect as though
all of the signers had signed a single signature page.


 


Signatures appear on the
following page


 


39





















 


IN
WITNESS WHEREOF, the undersigned have caused these presents to be executed as
of the day and year first above written.


 


	
   

  	
  STATE STREET BANK AND
  TRUST COMPANY OF

  CONNECTICUT, NATIONAL ASSOCIATION,

  
	
   

  	
  as Institutional
  Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul D. Allen

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Paul D. Allen

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FIRST REGIONAL BANCORP,
  as Sponsor

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas McCullough

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Thomas McCullough

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FIRST REGIONAL
  STATUTORY TRUST I

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jack A. Sweeney

  	
   

  	
   

  
	
   

  	
   

  	
  Administrator

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ H. Anthony
  Gartshore

  	
   

  	
   

  
	
   

  	
   

  	
  Administrator

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas McCullough

  	
   

  	
   

  
	
   

  	
   

  	
  Administrator

  	
   

  
												



 


40





















 


ANNEX I


 


TERMS OF
SECURITIES


 


Pursuant to Section 6.1 of the Amended and Restated
Declaration of Trust, dated as of December 18, 2001 (as amended from time to
time, the “Declaration”), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities and the Common
Securities are set out below (each capitalized term used but not defined herein
has the meaning set forth in the Declaration):


 


1.             Designation and Number.


 


(a)           5,000
Floating Rate Capital Securities of First Regional Statutory Trust I (the “Trust”),
with an aggregate stated liquidation amount with respect to the assets of the
Trust of $5,000,000 and a stated liquidation amount with respect to the assets
of the Trust of $1,000.00 per Capital Security, are hereby designated for the
purposes of identification only as the “Capital Securities”.  The Capital Security Certificates evidencing
the Capital Securities shall be substantially in the form of Exhibit A-1
to the Declaration, with such changes and additions thereto or deletions
therefrom as may be required by ordinary usage, custom or practice.


 


(b)           155
Floating Rate Common Securities of the Trust (the “Common Securities”)
will be evidenced by Common Security Certificates substantially in the form of
Exhibit A-2 to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice.


 


2.             Distributions.


 


(a)           Distributions
will be payable on each Security for the period beginning on (and including)
the date of original issuance and ending on (but excluding) March 18, 2002 at a
rate per annum of 5.60% and shall bear interest for each successive period
beginning on (and including) March 18, 2002, and each succeeding Distribution
Payment Date, and ending on (but excluding) the next succeeding Distribution
Payment Date (each, a “Distribution Period”) at a rate per annum equal
to the 3-Month LIBOR, determined as described below, plus 3.60% (the “Coupon
Rate”); provided, however, that prior to December 18, 2006,
the Coupon Rate shall not exceed 12.50%, applied to the stated liquidation
amount thereof, such rate being the rate of interest payable on the Debentures
to be held by the Institutional Trustee. 
Distributions in arrears for more than one quarterly period will bear
interest thereon compounded quarterly at the applicable Distribution Rate (to
the extent permitted by law).  A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Institutional Trustee and to the extent the
Institutional Trustee has funds available therefor.  In the event that any date on which a
Distribution is payable on the Securities is not a Business Day, then payment
of interest payable on such date shall be made on the next succeeding day which
is a Business Day (and without any interest or other payment in respect of any
such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date such
payment was originally payable.  The
amount of interest payable for any Distribution Period will be calculated by
applying the Coupon Rate to the principal amount outstanding at the commencement
of the Distribution Period and multiplying each such amount by the actual
number of days in the Distribution Period concerned divided by 360.  All percentages resulting from any
calculations on the Capital Securities will be rounded, if necessary, to the
nearest one hundred-thousandth of a percentage point, with five one-millionths
of a percentage point rounded upward (e.g., 9.876545% or .09876545 being
rounded to 9.87655% or .0987655, and all dollar


 


I-1





















 


amounts used in or resulting from such calculation will be rounded to
the nearest cent (with one-half cent being rounded upward)).


 


(b)           Distributions
on the Securities will be cumulative, will accrue from the date of original
issuance, and will be payable, subject to extension of distribution payment
periods as described herein, quarterly in arrears on March 18, June 18,
September 18, and December 18 of each year, commencing on March 18, 2002 (each
a “Distribution Payment Date”) when, as and if available for
payment.  The Debenture Issuer has the
right under the Indenture to defer payments of interest on the Debentures, so
long as no Indenture Event of Default has occurred and is continuing, by
deferring the payment of interest on the Debentures for up to 20 consecutive
quarterly periods (each an “Extension Period”) at any time and from time
to time, subject to the conditions described below, although such interest
would continue to accrue on the Debentures at the Distribution Rate compounded
quarterly (to the extent permitted by law) during any Extension Period.  No Extension Period may end on a date other
than a Distribution Payment Date.  At the
end of any such Extension Period the Debenture Issuer shall pay all interest
then accrued and unpaid on the Debentures (together with Additional Interest
thereon); provided, however, that no Extension Period may extend
beyond the Maturity Date and provided  further, however,
during any such Extension Period, the Debenture Issuer and its Affiliates shall
not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, any of the
Debenture Issuer’s or its Affiliates’ capital stock (other than payments of
dividends or distributions to the Debenture Issuer) or make any guarantee
payments with respect to the foregoing, or (ii) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Debenture Issuer or any Affiliate that rank pari passu in all respects with or junior in interest
to the Debentures (other than, with respect to clauses (i) and (ii) above,
(a) repurchases, redemptions or other acquisitions of shares of capital
stock of the Debenture Issuer in connection with any employment contract,
benefit plan or other similar arrangement with or for the benefit of one or
more employees, officers, directors or consultants, in connection with a
dividend reinvestment or stockholder stock purchase plan or in connection with
the issuance of capital stock of the Debenture Issuer (or securities
convertible into or exercisable for such capital stock) as consideration in an
acquisition transaction entered into prior to the applicable Extension Period,
(b) as a result of any exchange or conversion of any class or series of
the Debenture Issuer’s capital stock (or any capital stock of a subsidiary of
the Debenture Issuer) for any class or series of the Debenture Issuer’s capital
stock or of any class or series of the Debenture Issuer’s indebtedness for any
class or series of the Debenture Issuer’s capital stock, (c) the purchase
of fractional interests in shares of the Debenture Issuer’s capital stock
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (d) any declaration of a dividend
in connection with any stockholders’ rights plan, or the issuance of rights,
stock or other property under any stockholders’ rights plan, or the redemption
or repurchase of rights pursuant thereto, (e) any dividend in the form of
stock, warrants, options or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other rights is the same
stock as that on which the dividend is being paid or ranks pari passu
with or junior to such stock and any cash payments in lieu of fractional shares
issued in connection therewith, or (f) payments under the Capital
Securities Guarantee).  Prior to the
termination of any Extension Period, the Debenture Issuer may further extend
such period, provided that such period together with all such previous and
further consecutive extensions thereof shall not exceed 20 consecutive
quarterly periods, or extend beyond the Maturity Date.  Upon the termination of any Extension Period
and upon the payment of all accrued and unpaid interest and Additional
Interest, the Debenture Issuer may commence a new Extension Period, subject to
the foregoing requirements.  No interest
or Additional Interest shall be due and payable during an Extension Period,
except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear
Additional Interest.  If Distributions
are deferred, the Distributions due shall be paid on the date that the related
Extension Period terminates, to Holders of the Securities as they appear on the
books and records of the Trust on the record date immediately preceding such
date.  Distributions on the Securities
must be paid on the dates


 


I-2





















 


payable (after giving effect to any Extension Period) to the extent
that the Trust has funds available for the payment of such distributions in the
Property Account of the Trust.  The Trust’s
funds available for Distribution to the Holders of the Securities will be
limited to payments received from the Debenture Issuer.  The payment of Distributions out of moneys
held by the Trust is guaranteed by the Guarantor pursuant to the Guarantee.


 


(c)           Distributions
on the Securities will be payable to the Holders thereof as they appear on the
books and records of the Trust on the relevant record dates.  The relevant record dates shall be 15 days
before the relevant Distribution Payment Date. 
Distributions payable on any Securities that are not punctually paid on
any Distribution Payment Date, as a result of the Debenture Issuer having
failed to make a payment under the Debentures, as the case may be, when due
(taking into account any Extension Period), will cease to be payable to the
Person in whose name such Securities are registered on the relevant record
date, and such defaulted Distribution will instead be payable to the Person in
whose name such Securities are registered on the special record date or other
specified date determined in accordance with the Indenture.  If any date on which Distributions are
payable on the Securities is not a Business Day, then payment of the
Distribution payable on such date will be made on the next succeeding day that
is a Business Day (and without any interest or other payment in respect of any
such delay) except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such payment
date.


 


(d)           In
the event that there is any money or other property held by or for the Trust
that is not accounted for hereunder, such property shall be distributed Pro
Rata (as defined herein) among the Holders of the Securities.


 


3.             Liquidation Distribution Upon
Dissolution.  In the event of the
voluntary or involuntary liquidation, dissolution, winding-up or termination of
the Trust (each a “Liquidation”) other than in connection with a
redemption of the Debentures, the Holders of the Securities will be entitled to
receive out of the assets of the Trust available for distribution to Holders of
the Securities, after satisfaction of liabilities to creditors of the Trust (to
the extent not satisfied by the Debenture Issuer), distributions equal to the
lesser of (i) the aggregate of the stated liquidation amount of $1,000.00
per Security plus accrued and unpaid Distributions thereon to the date of
payment, to the extent the Trust shall have funds available therefor, and
(ii) the amount of assets of the Trust remaining available for distribution
to Holders in liquidation of the Trust (such amount being, in either case, the “Liquidation
Distribution”), unless in connection with such Liquidation, the Debentures
in aggregate stated principal amount equal to the aggregate stated liquidation
amount of such Securities, with an interest rate equal to the Distribution Rate
of, and bearing accrued and unpaid interest in an amount equal to the accrued
and unpaid Distributions on, and having the same record date as, such
Securities, after paying or making reasonable provision to pay all claims and
obligations of the Trust in accordance with the Statutory Trust Act, shall be
distributed on a Pro Rata basis to the Holders of the Securities in exchange
for such Securities.


 


The
Sponsor, as the Holder of all of the Common Securities, has the right at any
time to dissolve the Trust (including, without limitation, upon the occurrence
of a Special Event), subject to the receipt by the Debenture Issuer of prior
approval from the Board of Governors of the Federal Reserve System and any
successor federal agency that is primarily responsible for regulating the
activities of Sponsor (the “Federal Reserve”), if the Sponsor is a bank
holding company, or from the Office of Thrift Supervision and any successor
federal agency that is primarily responsible for regulating the activities of
Sponsor, (the “OTS”) if the company is a savings and loan holding
company, in either case if then required under applicable capital guidelines or
policies of the Federal Reserve or OTS, as applicable, and, after satisfaction
of liabilities to creditors of the Trust, cause the Debentures to be
distributed to the Holders of the Securities on a Pro Rata basis in accordance
with the aggregate stated liquidation amount thereof.


 


I-3





















 


If a
Liquidation of the Trust occurs as described in clause (i), (ii), (iii) or
(v) in Section 7.1(a) of the Declaration, the Trust shall be liquidated by the
Institutional Trustee as expeditiously as it determines to be possible by
distributing, after satisfaction of liabilities to creditors of the Trust, to
the Holders of the Securities, the Debentures on a Pro Rata basis to the extent
not satisfied by the Debenture Issuer, unless such distribution is determined by
the Institutional Trustee not to be practical, in which event such Holders will
be entitled to receive out of the assets of the Trust available for
distribution to the Holders, after satisfaction of liabilities of creditors of
the Trust to the extent not satisfied by the Debenture Issuer, an amount equal
to the Liquidation Distribution.  An
early Liquidation of the Trust pursuant to clause (iv) of Section 7.1(a)
of the Declaration shall occur if the Institutional Trustee determines that
such Liquidation is possible by distributing, after satisfaction of liabilities
to creditors of Trust, to the Holders of the Securities on a Pro Rata basis,
the Debentures, and such distribution occurs.


 


If,
upon any such Liquidation the Liquidation Distribution can be paid only in part
because the Trust has insufficient assets available to pay in full the
aggregate Liquidation Distribution, then the amounts payable directly by the
Trust on such Capital Securities shall be paid to the Holders of the Trust
Securities on a Pro Rata basis, except that if an Event of Default has occurred
and is continuing, the Capital Securities shall have a preference over the
Common Securities with regard to such distributions.


 


After
the date for any distribution of the Debentures upon dissolution of the Trust
(i) the Securities of the Trust will be deemed to be no longer
outstanding, (ii) upon surrender of a Holder’s Securities certificate,
such Holder of the Securities will receive a certificate representing the
Debentures to be delivered upon such distribution, and (iii) any
certificates representing the Securities still outstanding will be deemed to
represent undivided beneficial interests in such of the Debentures as have an
aggregate principal amount equal to the aggregate stated liquidation amount
with an interest rate identical to the Distribution Rate of, and bearing
accrued and unpaid interest equal to accrued and unpaid distributions on, the
Securities until such certificates are presented to the Debenture Issuer or its
agent for transfer or reissuance (and until such certificates are so
surrendered, no payments of interest or principal shall be made to Holders of
Securities in respect of any payments due and payable under the Debentures; provided,
however that such failure to pay shall not be deemed to be an Event of
Default and shall not entitle the Holder to the benefits of the Guarantee), and
(iv) all rights of Holders of Securities under the Declaration shall
cease, except the right of such Holders to receive Debentures upon surrender of
certificates representing such Securities.


 


4.             Redemption and Distribution.


 


(a)           The
Debentures will mature on December 18, 2031. The Debentures may be redeemed by
the Debenture Issuer, in whole or in part at any time and from time to time on
or after December 18, 2006, at the Redemption Price. In addition, the
Debentures may be redeemed by the Debenture Issuer at the Special Redemption
Price, in whole but not in part, at any Distribution Payment Date, upon the
occurrence and continuation of a Special Event within 120 days following
the occurrence of such Special Event at the Special Redemption Price, upon not
less than 30 nor more than 60 days’ notice to holders of such
Debentures so long as such Special Event is continuing. In each case, the right
of the Debenture Issuer to redeem the Debentures is subject to the Debenture
Issuer having received prior approval from the Federal Reserve (if the
Debenture Issuer is a bank holding company) or prior approval from the OTS (if
the Debenture Issuer is a savings and loan holding company), in each case if
then required under applicable capital guidelines or policies of the applicable
federal agency.


 


“3-Month
LIBOR” means the London interbank offered interest rate for three-month,
U.S. dollar deposits determined by the Debenture Trustee in the following order
of priority:


 


(1)           the rate (expressed as a percentage
per annum) for U.S. dollar deposits having a three-month maturity that appears
on Telerate Page 3750 as of 11:00 a.m. (London time) on the


 


I-4





















 


related
Determination Date (as defined below).  “Telerate
Page 3750” means the display designated as “Page 3750” on the Dow
Jones Telerate Service or such other page as may replace Page 3750 on that
service or such other service or services as may be nominated by the British
Bankers’ Association as the information vendor for the purpose of displaying
London interbank offered rates for U.S. dollar deposits;


 


(2)           if such rate cannot be identified on
the related Determination Date, the Debenture Trustee will request the
principal London offices of four leading banks in the London interbank market
to provide such banks’ offered quotations (expressed as percentages per annum)
to prime banks in the London interbank market for U.S. dollar deposits having a
three-month maturity as of 11:00 a.m. (London time) on such Determination
Date.  If at least two quotations are
provided, 3-Month LIBOR will be the arithmetic mean of such quotations;


 


(3)           if fewer than two such quotations are
provided as requested in clause (2) above, the Debenture Trustee will
request four major New York City banks to provide such banks’ offered
quotations (expressed as percentages per annum) to leading European banks for
loans in U.S. dollars as of 11:00 a.m. (London time) on such Determination
Date.  If at least two such quotations
are provided, 3-Month LIBOR will be the arithmetic mean of such quotations; and


 


(4)           if fewer than two such quotations are
provided as requested in clause (3) above, 3-Month LIBOR will be a 3-Month
LIBOR determined with respect to the Distribution Period immediately preceding
such current Distribution Period.


 


If the
rate for U.S. dollar deposits having a three-month maturity that initially
appears on Telerate Page 3750 as of 11:00 a.m. (London time) on the
related Determination Date is superseded on the Telerate Page 3750 by a
corrected rate by 12:00 noon (London time) on such Determination Date,
then the corrected rate as so substituted on the applicable page will be the
applicable 3-Month LIBOR for such Determination Date.


 


(5)           The Coupon Rate for any Distribution
Period will at no time be higher than the maximum rate then permitted by New
York law as the same may be modified by United States law.


 


“Capital
Treatment Event” means the receipt by the Debenture Issuer and the Trust of
an opinion of counsel experienced in such matters to the effect that, as a
result of the occurrence of any amendment to, or change (including any
announced prospective change) in, the laws, rules or regulations of the United
States or any political subdivision thereof or therein, or as the result of any
official or administrative pronouncement or action or decision interpreting or
applying such laws, rules or regulations, which amendment or change is effective
or which pronouncement, action or decision is announced on or after the date of
original issuance of the Debentures, there is more than an insubstantial risk
that the Sponsor will not, within 90 days of the date of such opinion, be
entitled to treat an amount equal to the aggregate liquidation amount of the
Debentures as “Tier 1 Capital” (or its then equivalent) for purposes of
the capital adequacy guidelines of the Federal Reserve, as then in effect and
applicable to the Sponsor (or if the Sponsor is not a bank holding company,
such guidelines applied to the Sponsor as if the Sponsor were subject to such
guidelines); provided, however, that the inability of the Sponsor
to treat all or any portion of the liquidation amount of the Debentures as
Tier l Capital shall not constitute the basis for a Capital Treatment
Event, if such inability results from the Sponsor having cumulative preferred
stock, minority interests in consolidated subsidiaries, or any other class of
security or interest which the Federal Reserve or OTS, as applicable, may now
or hereafter accord Tier 1 Capital treatment in excess of the amount which
may now or hereafter qualify for treatment as Tier 1 Capital under
applicable capital adequacy guidelines; provided  further, however,
that the distribution of Debentures in connection with the


 


I-5





















 


Liquidation of the Trust shall not in and of itself constitute a
Capital Treatment Event unless such Liquidation shall have occurred in
connection with a Tax Event or an Investment Company Event.


 


“Determination
Date” means the date that is two London Banking Days (i.e., a business day
in which dealings in deposits in U.S. dollars are transacted in the London
interbank market) preceding the particular Distribution Period for which a
Coupon Rate is being determined.


 


“Investment
Company Event” means the receipt by the Debenture Issuer and the Trust of
an opinion of counsel experienced in such matters to the effect that, as a
result of the occurrence of a change in law or regulation or written change
(including any announced prospective change) in interpretation or application
of law or regulation by any legislative body, court, governmental agency or
regulatory authority, there is more than an insubstantial risk that the Trust
is or will be considered an Investment Company that is required to be
registered under the Investment Company Act which change or prospective change
becomes effective or would become effective, as the case may be, on or after
the date of the issuance of the Debentures.


 


“Maturity
Date” means December 18, 2031.


 


“Redemption
Date” shall mean the date fixed for the redemption of Capital Securities,
which shall be March 18, June 18, September 18 or December 18 commencing
December 18, 2006.


 


“Redemption Price” means 100% of the principal
amount of the Debentures being redeemed, plus accrued and unpaid interest on
such Debentures to the Redemption Date.


 


“Special
Event” means a Tax Event, an Investment Company Event or a Capital
Treatment Event.


 


“Special
Redemption Date” means a Redemption Date on which a Special Event
redemption occurs.


 


“Special Redemption
Price” means (i) 107.5% of the principal amount of the Debentures
being redeemed on a Redemption Date that occurs before December 18, 2006 and
(ii) 100% of the principal amount of the Debentures being redeemed on a
Redemption Date that occurs on December 18, 2006 or after, plus accrued and
unpaid interest on such Debentures to the Redemption Date.


 


 “Tax Event” means the receipt by the Debenture
Issuer and the Trust of an opinion of counsel experienced in such matters to
the effect that, as a result of any amendment to or change (including any
announced prospective change) in the laws or any regulations thereunder of the
United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official administrative pronouncement (including
any private letter ruling, technical advice memorandum, field service advice,
regulatory procedure, notice or announcement including any notice or
announcement of intent to adopt such procedures or regulations (an “Administrative
Action”)) or judicial decision interpreting or applying such laws or
regulations, regardless of whether such Administrative Action or judicial decision
is issued to or in connection with a proceeding involving the Debenture Issuer
or the Trust and whether or not subject to review or appeal, which amendment,
clarification, change, Administrative Action or decision is enacted,
promulgated or announced, in each case on or after the date of original
issuance of the Debentures, there is more than an insubstantial risk that:
(i) the Trust is, or will be within 90 days of the date of such opinion,
subject to United States federal income tax with respect to income received or
accrued on the Debentures; (ii) interest payable by the Debenture Issuer
on the Debentures is not, or within 90 days of the date of such opinion, will
not be, deductible by the Debenture Issuer, in whole or in part, for United States
federal income tax purposes; or (iii) the Trust is, or will be within 90
days of the date of such opinion, subject to more than a de minimis amount of
other taxes, duties or other governmental charges.


 


I-6





















 


(b)           Upon
the repayment in full at maturity or redemption in whole or in part of the
Debentures (other than following the distribution of the Debentures to the
Holders of the Securities), the proceeds from such repayment or payment shall
concurrently be applied to redeem Pro Rata at the applicable Redemption Price
or Special Redemption Price, as applicable, Securities having an aggregate
liquidation amount equal to the aggregate principal amount of the Debentures so
repaid or redeemed; provided, however, that holders of such
Securities shall be given not less than 30 nor more than 60 days’ notice of
such redemption (other than at the scheduled maturity of the Debentures).


 


(c)           If
fewer than all the outstanding Securities are to be so redeemed, the Common Securities
and the Capital Securities will be redeemed Pro Rata and the Capital Securities
to be redeemed will be redeemed Pro Rata from each Holder of Capital
Securities.


 


(d)           The
Trust may not redeem fewer than all the outstanding Capital Securities unless all
accrued and unpaid Distributions have been paid on all Capital Securities for
all quarterly Distribution periods terminating on or before the date of
redemption.


 


(e)           Redemption
or Distribution Procedures.


 


(i)            Notice of any redemption of or
notice of distribution of the Debentures in exchange for, the Securities (a “Redemption/Distribution
Notice”) will be given by the Trust by mail to each Holder of Securities to
be redeemed or exchanged not fewer than 30 nor more than 60 days before the
date fixed for redemption or exchange thereof which, in the case of a
redemption, will be the date fixed for redemption of the Debentures. For
purposes of the calculation of the date of redemption or exchange and the dates
on which notices are given pursuant to this paragraph 4(e)(i), a
Redemption/Distribution Notice shall be deemed to be given on the day such
notice is first mailed by first-class mail, postage prepaid, to Holders of such
Securities. Each Redemption/Distribution Notice shall be addressed to the Holders
of such Securities at the address of each such Holder appearing on the books
and records of the Trust. No defect in the Redemption/Distribution Notice or in
the mailing thereof with respect to any Holder shall affect the validity of the
redemption or exchange proceedings with respect to any other Holder.


 


(ii)           If the Securities are to be redeemed
and the Trust gives a Redemption/ Distribution Notice, which notice may only be
issued if the Debentures are redeemed as set out in this paragraph 4
(which notice will be irrevocable), then, provided that the
Institutional Trustee has a sufficient amount of cash in connection with the
related redemption or maturity of the Debentures, the Institutional Trustee
will pay the relevant Redemption Price or Special Redemption Price, as
applicable, to the Holders of such Securities by check mailed to the address of
each such Holder appearing on the books and records of the Trust on the
Redemption Date.  If a
Redemption/Distribution Notice shall have been given and funds deposited as
required then immediately prior to the close of business on the date of such
deposit Distributions will cease to accrue on the Securities so called for
redemption and all rights of Holders of such Securities so called for
redemption will cease, except the right of the Holders of such Securities to
receive the applicable Redemption Price or Special Redemption Price specified
in paragraph 4(a), but without interest on such Redemption Price or
Special Redemption Price.  If any date
fixed for redemption of Securities is not a Business Day, then payment of any
such Redemption Price or Special Redemption Price payable on such date will be
made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay) except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date fixed for redemption. 
If payment of the Redemption Price or Special Redemption Price


 


I-7





















 


in respect of any
Securities is improperly withheld or refused and not paid either by the Trust
or by the Debenture Issuer as guarantor pursuant to the Guarantee,
Distributions on such Securities will continue to accrue at the Distribution
Rate from the original Redemption Date to the actual date of payment, in which
case the actual payment date will be considered the date fixed for redemption
for purposes of calculating the Redemption Price or Special Redemption
Price.  In the event of any redemption of
the Capital Securities issued by the Trust in part, the Trust shall not be
required to (i) issue, register the transfer of or exchange any Security
during a period beginning at the opening of business 15 days before any
selection for redemption of the Capital Securities and ending at the close of
business on the earliest date on which the relevant notice of redemption is
deemed to have been given to all Holders of the Capital Securities to be so
redeemed or (ii) register the transfer of or exchange any Capital
Securities so selected for redemption, in whole or in part except for the
unredeemed portion of any Capital Securities being redeemed in part.


 


(iii)          Redemption/Distribution Notices shall
be sent by the Administrators on behalf of the Trust to (A) in respect of
the Capital Securities, the Holders thereof and (B) in respect of the
Common Securities, the Holder thereof.


 


(iv)          Subject to the foregoing and applicable
law (including, without limitation, United States federal securities laws), and
provided that the acquiror is not the Holder of the Common Securities or the
obligor under the Indenture, the Sponsor or any of its subsidiaries may at any
time and from time to time purchase outstanding Capital Securities by tender,
in the open market or by private agreement.


 


5.             Voting Rights - Capital
Securities.


 


(a)           Except
as provided under paragraphs 5(b) and 7 and as otherwise required by law
and the Declaration, the Holders of the Capital Securities will have no voting
rights. The Administrators are required to call a meeting of the Holders of the
Capital Securities if directed to do so by Holders of at least 10% in
liquidation amount of the Capital Securities.


 


(b)           Subject
to the requirements of obtaining a tax opinion by the Institutional Trustee in
certain circumstances set forth in the last sentence of this paragraph, the
Holders of a Majority in liquidation amount of the Capital Securities, voting
separately as a class, have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Institutional
Trustee, or exercising any trust or power conferred upon the Institutional
Trustee under the Declaration, including the right to direct the Institutional
Trustee, as holder of the Debentures, to (i) exercise the remedies
available under the Indenture as the holder of the Debentures, (ii) waive
any past default that is waivable under the Indenture, (iii) exercise any
right to rescind or annul a declaration that the principal of all the
Debentures shall be due and payable or (iv) consent on behalf of all the
Holders of the Capital Securities to any amendment, modification or termination
of the Indenture or the Debentures where such consent shall be required; provided,
however, that, where a consent or action under the Indenture would
require the consent or act of the holders of greater than a simple majority in
aggregate principal amount of Debentures (a “Super Majority”) affected
thereby, the Institutional Trustee may only give such consent or take such
action at the written direction of the Holders of at least the proportion in
liquidation amount of the Capital Securities outstanding which the relevant
Super Majority represents of the aggregate principal amount of the Debentures
outstanding. If the Institutional Trustee fails to enforce its rights under the
Debentures after the Holders of a Majority in liquidation amount of such
Capital Securities have so directed the Institutional Trustee, to the fullest
extent permitted by law, a Holder of the Capital Securities may institute a
legal proceeding directly against the Debenture Issuer to enforce the
Institutional Trustee’s rights under the Debentures without first instituting any
legal proceeding against the Institutional Trustee or any other person or
entity. Notwithstanding the foregoing, if an Event of Default has occurred and
is


 


I-8





















 


continuing and such event is attributable to the failure of the
Debenture Issuer to pay interest or principal on the Debentures on the date the
interest or principal is payable (or in the case of redemption, the Redemption
Date), then a Holder of record of the Capital Securities may directly institute
a proceeding for enforcement of payment on or after the respective due dates
specified in the Debentures, to such Holder directly of the principal of or
interest on the Debentures having an aggregate principal amount equal to the
aggregate liquidation amount of the Capital Securities of such Holder. The
Institutional Trustee shall notify all Holders of the Capital Securities of any
default actually known to the Institutional Trustee with respect to the
Debentures unless (x) such default has been cured prior to the giving of
such notice or (y) the Institutional Trustee determines in good faith that
the withholding of such notice is in the interest of the Holders of such
Capital Securities, except where the default relates to the payment of principal
of or interest on any of the Debentures. Such notice shall state that such
Indenture Event of Default also constitutes an Event of Default hereunder.
Except with respect to directing the time, method and place of conducting a
proceeding for a remedy, the Institutional Trustee shall not take any of the
actions described in clauses (i), (ii) or (iii) above unless the
Institutional Trustee has obtained an opinion of tax counsel to the effect
that, as a result of such action, the Trust will not be classified as other
than a grantor trust for United States federal income tax purposes.


 


In the
event the consent of the Institutional Trustee, as the holder of the Debentures
is required under the Indenture with respect to any amendment, modification or
termination of the Indenture, the Institutional Trustee shall request the
direction of the Holders of the Securities with respect to such amendment
modification or termination and shall vote with respect to such amendment,
modification or termination as directed by a Majority in liquidation amount of
the Securities voting together as a single class; provided, however,
that where a consent under the Indenture would require the consent of a
Super-Majority, the Institutional Trustee may only give such consent at the
direction of the Holders of at least the proportion in liquidation amount of
the Securities outstanding which the relevant Super-Majority represents of the
aggregate principal amount of the Debentures outstanding. The Institutional
Trustee shall not take any such action in accordance with the directions of the
Holders of the Securities unless the Institutional Trustee has obtained an
opinion of tax counsel to the effect that, as a result of such action, the
Trust will not be classified as other than a grantor trust for United States
federal income tax purposes.


 


A
waiver of an Indenture Event of Default will constitute a waiver of the
corresponding Event of Default hereunder. Any required approval or direction of
Holders of the Capital Securities may be given at a separate meeting of Holders
of the Capital Securities convened for such purpose, at a meeting of all of the
Holders of the Securities in the Trust or pursuant to written consent. The
Institutional Trustee will cause a notice of any meeting at which Holders of the
Capital Securities are entitled to vote, or of any matter upon which action by
written consent of such Holders is to be taken, to be mailed to each Holder of
record of the Capital Securities. Each such notice will include a statement
setting forth the following information (i) the date of such meeting or
the date by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consents. No vote or
consent of the Holders of the Capital Securities will be required for the Trust
to redeem and cancel Capital Securities or to distribute the Debentures in accordance
with the Declaration and the terms of the Securities.


 


Notwithstanding
that Holders of the Capital Securities are entitled to vote or consent under
any of the circumstances described above, any of the Capital Securities that
are owned by the Sponsor or any Affiliate of the Sponsor shall not entitle the
Holder thereof to vote or consent and shall, for purposes of such vote or
consent, be treated as if such Capital Securities were not outstanding.


 


In no
event will Holders of the Capital Securities have the right to vote to appoint,
remove or replace the Administrators, which voting rights are vested
exclusively in the Sponsor as the Holder of all


 


I-9





















 


of the Common Securities of the Trust. 
Under certain circumstances as more fully described in the Declaration,
Holders of Capital Securities have the right to vote to appoint, remove or
replace the Institutional Trustee.


 


6.             Voting Rights - Common
Securities.


 


(a)           Except
as provided under paragraphs 6(b), 6(c) and 7 and as otherwise required by
law and the Declaration, the Common Securities will have no voting rights.


 


(b)           The
Holders of the Common Securities are entitled, in accordance with
Article IV of the Declaration, to vote to appoint, remove or replace any
Administrators.


 


(c)           Subject
to Section 6.7 of the Declaration and only after each Event of Default (if any)
with respect to the Capital Securities has been cured, waived, or otherwise
eliminated and subject to the requirements of the second to last sentence of
this paragraph, the Holders of a Majority in liquidation amount of the Common
Securities, voting separately as a class, may direct the time, method, and
place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under the Declaration, including (i) directing the
time, method, place of conducting any proceeding for any remedy available to
the Debenture Trustee, or exercising any trust or power conferred on the
Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under the Indenture, or
(iii) exercise any right to rescind or annul a declaration that the
principal of all the Debentures shall be due and payable; provided, however,
that, where a consent or action under the Indenture would require a Super
Majority, the Institutional Trustee may only give such consent or take such
action at the written direction of the Holders of at least the proportion in
liquidation amount of the Common Securities which the relevant Super Majority
represents of the aggregate principal amount of the Debentures outstanding.
Notwithstanding this paragraph 6(c), the Institutional Trustee shall not
revoke any action previously authorized or approved by a vote or consent of the
Holders of the Capital Securities. Other than with respect to directing the
time, method and place of conducting any proceeding for any remedy available to
the Institutional Trustee or the Debenture Trustee as set forth above, the
Institutional Trustee shall not take any action described in (i), (ii) or
(iii) above, unless the Institutional Trustee has obtained an opinion of tax
counsel to the effect that for the purposes of United States federal income tax
the Trust will not be classified as other than a grantor trust on account of
such action. If the Institutional Trustee fails to enforce its rights under the
Declaration to the fullest extent permitted by law, any Holder of the Common
Securities may institute a legal proceeding directly against any Person to
enforce the Institutional Trustee’s rights under the Declaration, without first
instituting a legal proceeding against the Institutional Trustee or any other
Person.


 


Any
approval or direction of Holders of the Common Securities may be given at a
separate meeting of Holders of the Common Securities convened for such purpose,
at a meeting of all of the Holders of the Securities in the Trust or pursuant
to written consent.  The Administrators will
cause a notice of any meeting at which Holders of the Common Securities are
entitled to vote, or of any matter upon which action by written consent of such
Holders is to be taken, to be mailed to each Holder of the Common Securities.
Each such notice will include a statement setting forth (i) the date of
such meeting or the date by which such action is to be taken, (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote or of such matter upon which written consent
is sought and (iii) instructions for the delivery of proxies or consents.


 


No
vote or consent of the Holders of the Common Securities will be required for
the Trust to redeem and cancel Common Securities or to distribute the Debentures
in accordance with the Declaration and the terms of the Securities.


 


I-10





















 


7.             Amendments to Declaration and
Indenture.


 


(a)           In
addition to any requirements under Section 11.1 of the Declaration, if any
proposed amendment to the Declaration provides for, or the Institutional
Trustee, Sponsor or Administrators otherwise propose to effect, (i) any
action that would adversely affect the powers, preferences or special rights of
the Securities, whether by way of amendment to the Declaration or otherwise, or
(ii) the Liquidation of the Trust, other than as described in Section 7.1
of the Declaration, then the Holders of outstanding Securities, voting together
as a single class, will be entitled to vote on such amendment or proposal and
such amendment or proposal shall not be effective except with the approval of
the Holders of at least a Majority in liquidation amount of the Securities,
affected thereby; provided, however, if any amendment or proposal
referred to in clause (i) above would adversely affect only the Capital
Securities or only the Common Securities, then only the affected class will be
entitled to vote on such amendment or proposal and such amendment or proposal
shall not be effective except with the approval of a Majority in liquidation
amount of such class of Securities.


 


(b)           In
the event the consent of the Institutional Trustee as the holder of the
Debentures is required under the Indenture with respect to any amendment,
modification or termination of the Indenture or the Debentures, the
Institutional Trustee shall request the written direction of the Holders of the
Securities with respect to such amendment, modification or termination and
shall vote with respect to such amendment, modification, or termination as
directed by a Majority in liquidation amount of the Securities voting together
as a single class; provided, however, that where a consent under
the Indenture would require a Super Majority, the Institutional Trustee may
only give such consent at the direction of the Holders of at least the
proportion in liquidation amount of the Securities which the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding.


 


(c)           Notwithstanding
the foregoing, no amendment or modification may be made to the Declaration if
such amendment or modification would (i) cause the Trust to be classified
for purposes of United States federal income taxation as other than a grantor
trust, (ii) reduce or otherwise adversely affect the powers of the
Institutional Trustee or (iii) cause the Trust to be deemed an Investment
Company which is required to be registered under the Investment Company Act.


 


(d)           Notwithstanding
any provision of the Declaration, the right of any Holder of the Capital
Securities to receive payment of distributions and other payments upon
redemption or otherwise, on or after their respective due dates, or to
institute a suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder. For the protection and enforcement of the foregoing provision, each and
every Holder of the Capital Securities shall be entitled to such relief as can
be given either at law or equity.


 


8.             Pro Rata.  A reference in these terms of the Securities
to any payment, distribution or treatment as being “Pro Rata” shall mean
pro rata to each Holder of the Securities according to the aggregate
liquidation amount of the Securities held by the relevant Holder in relation to
the aggregate liquidation amount of all Securities then outstanding unless, in
relation to a payment, an Event of Default has occurred and is continuing, in
which case any funds available to make such payment shall be paid first to each
Holder of the Capital Securities Pro Rata according to the aggregate
liquidation amount of the Capital Securities held by the relevant Holder
relative to the aggregate liquidation amount of all Capital Securities
outstanding, and only after satisfaction of all amounts owed to the Holders of
the Capital Securities, to each Holder of the Common Securities Pro Rata
according to the aggregate liquidation amount of the Common Securities held by
the relevant Holder relative to the aggregate liquidation amount of all Common
Securities outstanding.


 


9.             Ranking.  The Capital Securities rank pari passu with and payment thereon shall be made Pro Rata
with the Common Securities except that, where an Event of Default has occurred
and is


 


I-11





















 


continuing, the rights of Holders of the Common Securities to receive
payment of Distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights of the Holders of the Capital
Securities with the result that no payment of any Distribution on, or
Redemption Price of, any Common Security, and no other payment on account of
redemption, liquidation or other acquisition of Common Securities, shall be
made unless payment in full in cash of all accumulated and unpaid Distributions
on all outstanding Capital Securities for all distribution periods terminating
on or prior thereto, or in the case of payment of the Redemption Price the full
amount of such Redemption Price on all outstanding Capital Securities then
called for redemption, shall have been made or provided for, and all funds
immediately available to the Institutional Trustee shall first be applied to
the payment in full in cash of all Distributions on, or the Redemption Price
of, the Capital Securities then due and payable.


 


10.           Acceptance of Guarantee and
Indenture. Each Holder of the Capital Securities and the Common Securities,
by the acceptance of such Securities, agrees to the provisions of the
Guarantee, including the subordination provisions therein and to the provisions
of the Indenture.


 


11.           No Preemptive Rights. The
Holders of the Securities shall have no preemptive or similar rights to
subscribe for any additional securities.


 


12.           Miscellaneous. These terms
constitute a part of the Declaration. The Sponsor will provide a copy of the
Declaration, the Guarantee, and the Indenture to a Holder without charge on
written request to the Sponsor at its principal place of business.


 


I-12





















 


EXHIBIT A-1


 


FORM OF
CAPITAL SECURITY CERTIFICATE


 


[FORM OF FACE OF
SECURITY]


 


THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAW.  NEITHER THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS.  THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER
THIS SECURITY ONLY (A) TO THE SPONSOR OR THE TRUST, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A
SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A IN
ACCORDANCE WITH RULE 144A, (D) TO A NON-U.S. PERSON IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE)
OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF RULE 501 UNDER
THE SECURITIES ACT THAT IS ACQUIRING THIS CAPITAL SECURITY FOR ITS OWN ACCOUNT,
OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE SPONSOR’S AND THE TRUST’S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM IN
ACCORDANCE WITH THE DECLARATION OF TRUST, A COPY OF WHICH MAY BE OBTAINED FROM
THE SPONSOR OR THE TRUST.  HEDGING
TRANSACTIONS INVOLVING THIS SECURITY MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE
WITH THE SECURITIES ACT.


 


THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND
WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY
WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S
INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY
ACQUIRE OR HOLD THE SECURITIES OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER
OR HOLDER IS ELIGIBLE FOR EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF
LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14
OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS
NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT
TO SUCH PURCHASE OR HOLDING.  ANY
PURCHASER OR HOLDER OF THE SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO
HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS NOT
AN EMPLOYEE BENEFIT PLAN WITHIN THE


 


A-1-1





















 


MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF
THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN
EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF
ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH
PURCHASE WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA
OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR
ADMINISTRATIVE EXEMPTION.


 


THIS
SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A
LIQUIDATION AMOUNT OF NOT LESS THAN $500,000.00 (500 SECURITIES) AND MULTIPLES
OF $1,000.00 IN EXCESS THEREOF.  ANY
ATTEMPTED TRANSFER OF SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS
THAN $500,000.00 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER.


 


THE
HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.


 


IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED BY
THE DECLARATION TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.


 


	
  Certificate Number P-1

  	
   

  	
  5,000 Capital Securities

  



 


December 18, 2001


 


Certificate Evidencing
Floating Rate Capital Securities


 


of


 


First Regional Statutory
Trust I


 


(liquidation amount
$1,000.00 per Capital Security)


 


First
Regional Statutory Trust I, a statutory trust created under the laws of the
State of Connecticut (the “Trust”), hereby certifies that The Bank of New York,
as indenture trustee under the Indenture dated as of December 18, 2001 among
Preferred Term Securities IV, Ltd., Preferred Term Securities IV, Inc. and The
Bank of New York (the “Holder”) is the registered owner of securities of the
Trust representing undivided beneficial interests in the assets of the Trust,
(liquidation amount $1,000.00 per capital security) (the “Capital Securities”).
Subject to the Declaration (as defined below), the Capital Securities are
transferable on the books and records of the Trust in person or by a duly
authorized attorney, upon surrender of this Certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities
represented hereby are issued pursuant to, and shall in all respects be subject
to, the provisions of the Amended and Restated Declaration of Trust of the
Trust dated as of December 18, 2001, among Jack A. Sweeney, H. Anthony
Gartshore and Thomas McCullough as Administrators, State Street Bank and Trust
Company of Connecticut, National Association, as Institutional Trustee, First
Regional Bancorp, as Sponsor, and the holders from time to time of undivided
beneficial interests in the assets of the Trust, including the designation of
the terms of the Capital Securities as set forth in Annex I to such
amended and restated declaration as the same may be amended from time to time
(the “Declaration”).  Capitalized terms
used herein but not defined shall have the meaning given them in the
Declaration. The Holder is entitled to the benefits of the Guarantee to the
extent provided therein. The Sponsor will provide a copy of the Declaration,
the Guarantee, and the Indenture to the Holder without charge upon written
request to the Trust at its principal place of business.


 


A-1-2





















 


Upon
receipt of this Security, the Holder is bound by the Declaration and is
entitled to the benefits thereunder.


 


By
acceptance of this Security, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Capital
Securities as evidence of beneficial ownership in the Debentures.


 


This
Capital Security is governed by, and construed in accordance with, the laws of
the State of Connecticut, without regard to principles of conflict of laws.


 


IN
WITNESS WHEREOF, the Trust has duly executed this certificate.


 


	
   

  	
  FIRST REGIONAL
  STATUTORY TRUST I

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title: Administrator

  



 


CERTIFICATE OF
AUTHENTICATION


 


This is one of the
Capital Securities referred to in the within-mentioned Declaration.


 


 


	
   

  	
  STATE STREET BANK AND
  TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION,

  
	
   

  	
  as the Institutional
  Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Officer

  	
   

  



 


A-1-3





















 


[FORM OF REVERSE OF
SECURITY]


 


Distributions
payable on each Capital Security will be payable at an annual rate equal to
5.60% beginning on (and including) the date of original issuance and ending on
(but excluding) March 18, 2002 and at an annual rate for each successive period
beginning on (and including) March 18, 2002, and each succeeding Distribution
Payment Date, and ending on (but excluding) the next succeeding Distribution
Payment Date (each a “Distribution Period”), equal to 3-Month LIBOR, determined
as described below, plus 3.60% (the “Coupon Rate”); provided, however,
that prior to December 18, 2006, the Coupon Rate shall not exceed 12.50%,
applied to the stated liquidation amount of $1,000.00 per Capital Security,
such rate being the rate of interest payable on the Debentures to be held by
the Institutional Trustee. Distributions in arrears for more than a quarterly
period will bear interest thereon compounded quarterly at the Distribution Rate
(to the extent permitted by applicable law). 
The term “Distributions” as used herein includes payments of Interest
and any principal on the Debentures held by the Institutional Trustee unless
otherwise stated.  A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available therefor.  As used
herein, “Determination Date” means the date that is two London Banking Days
(i.e., a business day in which dealings in deposits in U.S. dollars are
transacted in the London interbank market) preceding the commencement of the
relevant Distribution Period.  In the
event that any date on which a Distribution is payable on this Capital Security
is not a Business Day, then a payment of the Distribution payable on such date
will be made on the next succeeding day which is a Business Day (and without
any Distribution or other payment in respect of any such delay), except that,
if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on the date the payment was originally
payable.  The amount of interest payable
for any Distribution Period will be calculated by applying the Coupon Rate to
the principal amount outstanding at the commencement of the Distribution Period
and multiplying each such amount by the actual number of days in the Distribution
Period concerned divided by 360.


 


“3-Month
LIBOR” as used herein, means the London interbank offered interest rate for
three-month U.S. dollar deposits determined by the Debenture Trustee in the
following order of priority:  (i) the
rate (expressed as a percentage per annum) for U.S. dollar deposits having a
three-month maturity that appears on Telerate Page 3750 as of 11:00 a.m.
(London time) on the related Determination Date (“Telerate Page 3750” means the
display designated as “Page 3750” on the Dow Jones Telerate Service or such
other page as may replace Page 3750 on that service or such other service or
services as may be nominated by the British Bankers’ Association as the
information vendor for the purpose of displaying London interbank offered rates
for U.S. dollar deposits); (ii) if such rate cannot be identified on the
related Determination Date, the Debenture Trustee will request the principal
London offices of four leading banks in the London interbank market to provide
such banks’ offered quotations (expressed as percentages per annum) to prime
banks in the London interbank market for U.S. dollar deposits having a
three-month maturity as of 11:00 a.m. (London time) on such Determination
Date.  If at least two quotations are
provided, 3-Month LIBOR will be the arithmetic mean of such quotations;
(iii) if fewer than two such quotations are provided as requested in
clause (ii) above, the Debenture Trustee will request four major New York City
banks to provide such banks’ offered quotations (expressed as percentages per
annum) to leading European banks for loans in U.S. dollars as of 11:00 a.m.
(London time) on such Determination Date. 
If at least two such quotations are provided, 3-Month LIBOR will be the
arithmetic mean of such quotations; and (iv) if fewer than two such
quotations are provided as requested in clause (iii) above, 3-Month LIBOR will
be a 3-Month LIBOR determined with respect to the Distribution Period
immediately preceding such current Distribution Period.  If the rate for U.S. dollar deposits having a
three-month maturity that initially appears on Telerate Page 3750 as of 11:00
a.m. (London time) on the related Determination Date is superseded on the
Telerate Page 3750 by a corrected rate by 12:00 noon (London time) on such Determination
Date, then the corrected rate as so substituted on the applicable page will be
the applicable 3-Month LIBOR for such Determination Date.


 


A-1-4





















 


The
Coupon Rate for any Distribution Period will at no time be higher than the
maximum rate then permitted by New York law as the same may be modified by
United States law.


 


All
percentages resulting from any calculations on the Capital Securities will be
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward (e.g.,
9.876545% or .09876545 being rounded to 9.87655% or .0987655, and all dollar
amounts used in or resulting from such calculation will be rounded to the nearest
cent (with one-half cent being rounded upward)).


 


Except
as otherwise described below, Distributions on the Capital Securities will be
cumulative, will accrue from the date of original issuance and will be payable
quarterly in arrears on March 18, June 18, September 18, and December 18 of
each year, commencing on March 18, 2002. 
The Debenture Issuer has the right under the Indenture to defer payments
of interest on the Debentures by extending the interest payment period for up
to 20 consecutive quarterly periods (each an “Extension Period”) on the
Debentures, subject to the conditions described below, although such interest
would continue to accrue on the Debentures at an annual rate equal to the
Distribution Rate compounded quarterly to the extent permitted by law during
any Extension Period. No Extension Period may end on a date other than a
Distribution Payment Date. At the end of any such Extension Period the
Debenture Issuer shall pay all interest then accrued and unpaid on the
Debentures (together with Additional Interest thereon); provided, however,
that no Extension Period may extend beyond the Maturity Date.  Prior to the termination of any Extension
Period, the Debenture Issuer may further extend such period, provided that such
period together with all such previous and further consecutive extensions
thereof shall not exceed 20 consecutive quarterly periods, or extend beyond the
Maturity Date. Upon the termination of any Extension Period and upon the
payment of all accrued and unpaid interest and Additional Interest, the
Debenture Issuer may commence a new Extension Period, subject to the foregoing
requirements. No interest or Additional Interest shall be due and payable
during an Extension Period, except at the end thereof, but each installment of
interest that would otherwise have been due and payable during such Extension
Period shall bear Additional Interest. 
If Distributions are deferred, the Distributions due shall be paid on
the date that the related Extension Period terminates, to Holders of the
Securities as they appear on the books and records of the Trust on the record
date immediately preceding such date. Distributions on the Securities must be
paid on the dates payable (after giving effect to any Extension Period) to the
extent that the Trust has funds available for the payment of such distributions
in the Property Account of the Trust. The Trust’s funds available for
Distribution to the Holders of the Securities will be limited to payments
received from the Debenture Issuer. The payment of Distributions out of moneys
held by the Trust is guaranteed by the Guarantor pursuant to the Guarantee.


 


The
Capital Securities shall be redeemable as provided in the Declaration.


 


A-1-5





















 


ASSIGNMENT


 


FOR VALUE
RECEIVED, the undersigned assigns and transfers this Capital Security
Certificate to:


 


 


	
   

  	
   

  	 

	
   

  	
   

  	 

	
  (Insert assignee’s social security or tax
  identification number)

  	
   

  	
   

  
	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

				



 


 


	
  (Insert address and zip code of assignee) and
  irrevocably appoints

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  



 


agent to transfer
this Capital Security Certificate on the books of the Trust.  The agent may substitute another to act for
him or her.


 


	
  Date:

  	
   

  	
   

  
	
   

  
	
  Signature:

  	
   

  	
   

  
	
   

  
	
  (Sign exactly as your
  name appears on the other side of this Capital Security Certificate)

  
				



 


Signature
Guarantee:(1)


 










(1)  Signature must be guaranteed
by an “eligible guarantor institution” that is a bank, stockbroker, savings and
loan association or credit union meeting the requirements of the Security
registrar, which requirements include membership or participation in the
Securities Transfer Agents Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Security registrar in addition
to, or in substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.


 


A-1-6





















 


EXHIBIT A-2


 


FORM OF COMMON SECURITY
CERTIFICATE


 


THIS
COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO AN EXEMPTION FROM REGISTRATION.


 


THIS
CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN COMPLIANCE WITH SECTION 8.1 OF
THE DECLARATION.


 


	
  Certificate
  Number C-1

  	
  155
  Common Securities

  



 


 


December 18, 2001


 


Certificate Evidencing
Floating Rate Common Securities


 


of


 


First Regional Statutory
Trust I


 


First
Regional Statutory Trust I, a statutory trust created under the laws of the
State of Connecticut (the “Trust”), hereby certifies that First Regional
Bancorp (the “Holder”) is the registered owner of common securities of the
Trust representing undivided beneficial interests in the assets of the Trust
(the “Common Securities”).  The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities represented hereby are issued pursuant to,
and shall in all respects be subject to, the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of December 18, 2001, among
Jack A. Sweeney, H. Anthony Gartshore and Thomas McCullough, as Administrators,
State Street Bank and Trust Company of Connecticut, National Association, as
Institutional Trustee, First Regional Bancorp as Sponsor, and the holders from
time to time of undivided beneficial interest in the assets of the Trust
including the designation of the terms of the Common Securities as set forth in
Annex I to such amended and restated declaration, as the same may be amended
from time to time (the “Declaration”). 
Capitalized terms used herein but not defined shall have the meaning
given them in the Declaration.  The
Holder is entitled to the benefits of the Guarantee to the extent provided
therein.  The Sponsor will provide a copy
of the Declaration, the Guarantee and the Indenture to the Holder without
charge upon written request to the Sponsor at its principal place of business.


 


As set
forth in the Declaration, where an Event of Default has occurred and is
continuing, the rights of Holders of Common Securities to payment in respect of
Distributions and payments upon Liquidation, redemption or otherwise are
subordinated to the rights of payment of Holders of the Capital Securities.


 


Upon
receipt of this Certificate, the Holder is bound by the Declaration and is
entitled to the benefits thereunder.


 


By
acceptance of this Certificate, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Common
Securities as evidence of undivided beneficial ownership in the Debentures.


 


This
Common Security is governed by, and construed in accordance with, the laws of
the State of Connecticut, without regard to principles of conflict of laws.


 


A-2-1





















 


IN
WITNESS WHEREOF, the Trust has duly executed this certificate.


 


	
   

  	
  FIRST REGIONAL
  STATUTORY TRUST I

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title: Administrator

  



 


A-2-2





















 


[FORM OF REVERSE OF
SECURITY]


 


Distributions
payable on each Common Security will be identical in amount to the
Distributions payable on each Capital Security, which is at an annual rate
equal to 5.60% beginning on (and including) the date of original issuance and
ending on (but excluding) March 18, 2002 and at an annual rate for each successive
period beginning on (and including) March 18, 2002, and each succeeding
Distribution Payment Date, and ending on (but excluding) the next succeeding
Distribution Payment Date (each a “Distribution Period”), equal to 3-Month
LIBOR, determined as described below, plus 3.60% (the “Coupon Rate”); provided,
however, that prior to December 18, 2006, the Coupon Rate shall not
exceed 12.50%, applied to the stated liquidation amount of $1,000.00 per Common
Security, such rate being the rate of interest payable on the Debentures to be
held by the Institutional Trustee. Distributions in arrears for more than one
period will bear interest thereon compounded at the Distribution Rate (to the
extent permitted by applicable law).  The
term “Distributions” as used herein includes payments of Interest and any
principal on the Debentures held by the Institutional Trustee unless otherwise
stated.  A Distribution is payable only
to the extent that payments are made in respect of the Debentures held by the
Institutional Trustee and to the extent the Institutional Trustee has funds
available therefor.  As used herein, “Determination
Date” means the date that is two London Banking Days (i.e., a business day in
which dealings in deposits in U.S. dollars are transacted in the London
interbank market) preceding the commencement of the relevant Distribution
Period.  In the event that any date on
which a Distribution is payable on this Common Security is not a Business Day,
then a payment of the Distribution payable on such date will be made on the
next succeeding day which is a Business Day (and without any Distribution or
other payment in respect of any such delay), except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date the payment was originally payable.  The amount of interest payable for any
Distribution Period will be calculated by applying the Coupon Rate to the
principal amount outstanding at the commencement of the Distribution Period and
multiplying each such amount by the actual number of days in the Distribution
Period concerned divided by 360.


 


“3-Month
LIBOR” as used herein, means the London interbank offered interest rate for
three-month U.S. dollar deposits determined by the Debenture Trustee in the
following order of priority:  (i) the
rate (expressed as a percentage per annum) for U.S. dollar deposits having a
three-month maturity that appears on Telerate Page 3750 as of 11:00 a.m.
(London time) on the related Determination Date (“Telerate Page 3750” means the
display designated as “Page 3750” on the Dow Jones Telerate Service or such
other page as may replace Page 3750 on that service or such other service or
services as may be nominated by the British Bankers’ Association as the
information vendor for the purpose of displaying London interbank offered rates
for U.S. dollar deposits); (ii) if such rate cannot be identified on the
related Determination Date, the Debenture Trustee will request the principal
London offices of four leading banks in the London interbank market to provide
such banks’ offered quotations (expressed as percentages per annum) to prime
banks in the London interbank market for U.S. dollar deposits having a
three-month maturity as of 11:00 a.m. (London time) on such Determination
Date.  If at least two quotations are
provided, 3-Month LIBOR will be the arithmetic mean of such quotations; (iii)
if fewer than two such quotations are provided as requested in clause (ii)
above, the Debenture Trustee will request four major New York City banks to
provide such banks’ offered quotations (expressed as percentages per annum) to
leading European banks for loans in U.S. dollars as of 11:00 a.m. (London time)
on such Determination Date.  If at least
two such quotations are provided, 3-Month LIBOR will be the arithmetic mean of
such quotations; and (iv) if fewer than two such quotations are provided as
requested in clause (iii) above, 3-Month LIBOR will be a 3-Month LIBOR
determined with respect to the Distribution Period immediately preceding such
current Distribution Period.  If the rate
for U.S. dollar deposits having a three-month maturity that initially appears
on Telerate Page 3750 as of 11:00 a.m. (London time) on the related
Determination Date is superseded on the Telerate Page 3750 by a corrected rate
by 12:00 noon (London time) on such Determination Date, then the corrected rate
as so substituted on the applicable page will be the applicable 3-Month LIBOR for
such Determination Date.


 


A-2-3





















 


The
Coupon Rate for any Distribution Period will at no time be higher than the
maximum rate then permitted by New York law as the same may be modified by
United States law.


 


All
percentages resulting from any calculations on the Common Securities will be
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward (e.g.,
9.876545% or .09876545 being rounded to 9.87655% or .0987655, and all dollar
amounts used in or resulting from such calculation will be rounded to the
nearest cent (with one-half cent being rounded upward)).


 


Except
as otherwise described below, Distributions on the Common Securities will be
cumulative, will accrue from the date of original issuance and will be payable
quarterly in arrears on March 18, June 18, September 18, and December 18 of
each year, commencing on March 18, 2002. The Debenture Issuer has the right
under the Indenture to defer payments of interest on the Debentures by
extending the interest payment period for up to 20 consecutive quarterly
periods (each an “Extension Period”) on the Debentures, subject to the
conditions described below, although such interest would continue to accrue on
the Debentures at an annual rate equal to the Distribution Rate compounded
quarterly to the extent permitted by law during any Extension Period. No
Extension Period may end on a date other than an Interest Payment Date. At the end
of any such Extension Period the Sponsor shall pay all interest then accrued
and unpaid on the Debentures (together with Additional Interest thereon); provided,
however, that no Extension Period may extend beyond the Maturity
Date.  Prior to the termination of any
Extension Period, the Sponsor may further extend such period, provided that
such period together with all such previous and further consecutive extensions
thereof shall not exceed 20 consecutive quarterly periods, or extend beyond the
Maturity Date. Upon the termination of any Extension Period and upon the
payment of all accrued and unpaid interest and Additional Interest, the Sponsor
may commence a new Extension Period, subject to the foregoing requirements. No
interest or Additional Interest shall be due and payable during an Extension
Period, except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear
Additional Interest. If Distributions are deferred, the Distributions due shall
be paid on the date that the related Extension Period terminates, to Holders of
the Securities as they appear on the books and records of the Trust on the
record date immediately preceding such date. Distributions on the Securities must
be paid on the dates payable (after giving effect to any Extension Period) to
the extent that the Trust has funds available for the payment of such
distributions in the Property Account of the Trust. The Trust’s funds available
for Distribution to the Holders of the Securities will be limited to payments
received from the Debenture Issuer. The payment of Distributions out of moneys
held by the Trust is guaranteed by the Guarantor pursuant to the Guarantee.


 


The
Common Securities shall be redeemable as provided in the Declaration.


 


A-2-4





















 


ASSIGNMENT


 


FOR
VALUE RECEIVED, the undersigned assigns and transfers this Common Security
Certificate to:


 


 


	
   

  	
   

  	 

	
   

  	
   

  	 

	
  (Insert assignee’s social security or tax
  identification number)

  	
   

  	
   

  
	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  (Insert address and zip code of assignee) and
  irrevocably appoints

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

				



 


	
   

  	
   

  	
   agent

  	
   

  
	
   

  	
  to transfer this Common Security Certificate on the
  books of the Trust. The

  agent may substitute another to act for him or her.

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  (Sign exactly as your name appears on the other side
  of this Common Security

  Certificate)

  
	
   

  	
   

  
	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  (Sign exactly as your name appears on the other side
  of this common Security Certificate)

  
	
   

  	
   

  
	
  Signature Guarantee(2)

  
								



 


 










(2) Signature must be guaranteed by an “eligible guarantor institution”
that is a bank, stockbroker, savings and loan association or credit union,
meeting the requirements of the Security registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion Program
(“STAMP”) or such other “signature guarantee program” as may be determined by
the Security registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.


 


A-2-5





















 


EXHIBIT B


 


SPECIMEN OF INITIAL DEBENTURE


 


FLOATING RATE JUNIOR SUBORDINATED
DEFERRABLE INTEREST DEBENTURE


 


THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAW.  NEITHER THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS.  THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER
THIS SECURITY ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT,
(C) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A SO LONG AS
THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A IN ACCORDANCE
WITH RULE 144A, (D) TO A NON-U.S. PERSON IN AN OFFSHORE TRANSACTION
IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE) OF
REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF RULE 501 UNDER
THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR
THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE INDENTURE, A COPY
OF WHICH MAY BE OBTAINED FROM THE COMPANY.


 


THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND
WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYMENT RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”),  OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY,
AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THE
SECURITIES OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE
FOR EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION
CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE
EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS NOT PROHIBITED BY
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE
OR HOLDING.  ANY PURCHASER OR HOLDER OF
THE SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY
ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT
PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975
OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN
EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS
OF ANY


 


B-1





















 


EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH
PURCHASE WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OR ERISA
OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR
ADMINISTRATIVE EXEMPTION.


 


THIS
SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN
AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $500,000.00 AND MULTIPLES OF
$1,000.00 IN EXCESS THEREOF.  ANY
ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING AN AGGREGATE PRINCIPAL
AMOUNT OF LESS THAN $500,000.00 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL
EFFECT WHATSOEVER.


 


THE
HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.


 


IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATE AND OTHER INFORMATION AS MAY BE REQUIRED BY THE
INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.


 


Floating Rate Junior
Subordinated Deferrable Interest Debenture


 


of


 


First Regional Bancorp


 


December 18, 2001


 


First
Regional Bancorp, a California corporation (the “Company” which term includes
any successor Person under the Indenture hereinafter referred to), for value
received promises to pay to State Street Bank and Trust Company of Connecticut,
National Association, not in its individual capacity but solely as
Institutional Trustee for First Regional Statutory Trust I (the “Holder”) or
registered assigns, the principal sum of five million one hundred fifty five
thousand dollars ($5,155,000) on December 18, 2031, and to pay interest on said
principal sum from December 18, 2001, or from the most recent interest payment
date (each such date, an “Interest Payment Date”) to which interest has been
paid or duly provided for, quarterly (subject to deferral as set forth herein)
in arrears on March 18, June 18, September 18, and December 18 of each year
commencing March 18, 2002, at an annual rate equal to 5.60% beginning on (and
including) the date of original issuance and ending on (but excluding) March
18, 2002 and at an annual rate for each successive period beginning on (and
including) March 18, 2002, and each succeeding Interest Payment Date, and
ending on (but excluding) the next succeeding Interest Payment Date (each a “Distribution
Period”), equal to 3-Month LIBOR, determined as described below, plus 3.60%
(the “Coupon Rate”); provided, however, that prior to December
18, 2006, the Coupon Rate shall not exceed 12.50%, applied to the principal
amount hereof, until the principal hereof is paid or duly provided for or made
available for payment, and on any overdue principal and (without duplication)
on any overdue installment of interest at the same rate per annum, compounded
quarterly, from the dates such amounts are due until they are paid or made
available for payment.  The amount of
interest payable for any period will be computed on the basis of the actual
number of days in the Distribution Period concerned divided by 360.  In the event that any date on which interest
is payable on this Debenture is not a Business Day, then a payment of the
interest payable on such date will be made on the next succeeding day which is
a Business Day (and without any interest or other payment in respect of any
such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date the
payment was originally payable.  The
interest installment so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the Person
in whose name this Debenture (or one or more Predecessor Securities) is
registered at the close of business on the regular record date for such
interest installment, which shall be fifteen days prior to the day on


 


B-2





















 


which the relevant Interest Payment Date occurs.  Any such interest installment not so
punctually paid or duly provided for shall forthwith cease to be payable to the
Holder on such regular record date and may be paid to the Person in whose name
this Debenture (or one or more Predecessor Securities) is registered at the
close of business on a special record date.


 


“3-Month
LIBOR” as used herein, means the London interbank offered interest rate for
three-month U.S. dollar deposits determined by the Debenture Trustee in the
following order of priority:  (i) the
rate (expressed as a percentage per annum) for U.S. dollar deposits having a
three-month maturity that appears on Telerate Page 3750 as of 11:00 a.m.
(London time) on the related Determination Date (“Telerate Page 3750” means the
display designated as “Page 3750” on the Dow Jones Telerate Service or such
other page as may replace Page 3750 on that service or such other service or
services as may be nominated by the British Bankers’ Association as the
information vendor for the purpose of displaying London interbank offered rates
for U.S. dollar deposits); (ii) if such rate cannot be identified on the
related Determination Date, the Debenture Trustee will request the principal
London offices of four leading banks in the London interbank market to provide
such banks’ offered quotations (expressed as percentages per annum) to prime
banks in the London interbank market for U.S. dollar deposits having a
three-month maturity as of 11:00 a.m. (London time) on such Determination
Date.  If at least two quotations are
provided, 3-Month LIBOR will be the arithmetic mean of such quotations;
(iii) if fewer than two such quotations are provided as requested in
clause (ii) above, the Debenture Trustee will request four major New York City
banks to provide such banks’ offered quotations (expressed as percentages per
annum) to leading European banks for loans in U.S. dollars as of 11:00 a.m.
(London time) on such Determination Date. 
If at least two such quotations are provided, 3-Month LIBOR will be the
arithmetic mean of such quotations; and (iv) if fewer than two such
quotations are provided as requested in clause (iii) above, 3-Month LIBOR will
be a 3-Month LIBOR determined with respect to the Distribution Period
immediately preceding such current Distribution Period.  If the rate for U.S. dollar deposits having a
three-month maturity that initially appears on Telerate Page 3750 as of 11:00
a.m. (London time) on the related Determination Date is superseded on the
Telerate Page 3750 by a corrected rate by 12:00 noon (London time) on such
Determination Date, then the corrected rate as so substituted on the applicable
page will be the applicable 3-Month LIBOR for such Determination Date.  As used herein, “Determination Date” means
the date that is two London Banking Days (i.e., a business day in which
dealings in deposits in U.S. dollars are transacted in the London interbank
market) preceding the commencement of the relevant Distribution Period.


 


The
Coupon Rate for any Distribution Period will at no time be higher than the
maximum rate then permitted by New York law as the same may be modified by
United States law.


 


All
percentages resulting from any calculations on the Debentures will be rounded,
if necessary, to the nearest one hundred-thousandth of a percentage point, with
five one-millionths of a percentage point rounded upward (e.g., 9.876545% or
..09876545 being rounded to 9.87655% or .0987655, and all dollar amounts used in
or resulting from such calculation will be rounded to the nearest cent (with
one-half cent being rounded upward)).


 


The
principal of and interest on this Debenture shall be payable at the office or
agency of the Trustee (or other paying agent appointed by the Company)
maintained for that purpose in any coin or currency of the United States of
America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that payment of interest may be
made by check mailed to the registered holder at such address as shall appear
in the Debenture Register if a request for a wire transfer by such holder has
not been received by the Company or by wire transfer to an account appropriately
designated by the holder hereof. 
Notwithstanding the foregoing, so long as the holder of this Debenture
is the Institutional Trustee, the payment of the principal of and interest on
this Debenture will be made in immediately available funds at such place and to
such account as may be designated by the Trustee.


 


So
long as no Event of Default has occurred and is continuing, the Company shall
have the right, from time to time, and without causing an Event of Default, to
defer payments of interest on the Debentures by extending the interest payment
period on the Debentures at any time and from time to time


 


B-3





















 


during the term of the Debentures, for up to 20 consecutive
quarterly periods (each such extended interest payment period, an “Extension
Period”), during which Extension Period no interest (including Additional
Interest) shall be due and payable.  No
Extension Period may end on a date other than an Interest Payment Date.  At the end of any such Extension Period the
Company shall pay all interest then accrued and unpaid on the Debentures
(together with Additional Interest thereon); provided, however,
that no Extension Period may extend beyond the Maturity Date; provided  further,
however, that during any such Extension Period, the Company shall not
and shall not permit any Affiliate to (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company’s or such Affiliate’s capital stock (other
than payments of dividends or distributions to the Company) or make any
guarantee payments with respect to the foregoing or (ii) make any payment
of principal of or interest or premium, if any, on or repay, repurchase or
redeem any debt securities of the Company or any Affiliate that rank pari passu in all respects with or junior in interest to the
Debentures (other than, with respect to clauses (i) and (ii) above,
(a) repurchases, redemptions or other acquisitions of shares of capital
stock of the Company in connection with any employment contract, benefit plan
or other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of
capital stock of the Company (or securities convertible into or exercisable for
such capital stock) as consideration in an acquisition transaction entered into
prior to the applicable Extension Period, (b) as a result of any exchange
or conversion of any class or series of the Company’s capital stock (or any
capital stock of a subsidiary of the Company) for any class or series of the
Company’s capital stock or of any class or series of the Company’s indebtedness
for any class or series of the Company’s capital stock, (c) the purchase
of fractional interests in shares of the Company’s capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, (d) any declaration of a dividend in
connection with any stockholders’ rights plan, or the issuance of rights, stock
or other property under any stockholders’ rights plan, or the redemption or
repurchase of rights pursuant thereto, (e) any dividend in the form of
stock, warrants, options or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other rights is the same
stock as that on which the dividend is being paid or ranks pari passu
with or junior to such stock and any cash payments in lieu of fractional shares
issued in connection therewith, or (f) payments under the Capital
Securities Guarantee).  Prior to the
termination of any Extension Period, the Company may further extend such
period, provided that such period together with all such previous and further
consecutive extensions thereof shall not exceed 20 consecutive quarterly
periods, or extend beyond the Maturity Date. 
Upon the termination of any Extension Period and upon the payment of all
accrued and unpaid interest and Additional Interest, the Company may commence a
new Extension Period, subject to the foregoing requirements.  No interest or Additional Interest shall be
due and payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
such Extension Period shall bear Additional Interest.  The Company must give the Trustee notice of
its election to begin or extend such Extension Period at least 5 Business Days
prior to the earlier of (i) the date interest on the Debentures would have
been payable except for the election to begin such Extension Period or
(ii) the date such interest is payable, but in any event not less than 5
Business Days prior to such record date.


 


The
indebtedness evidenced by this Debenture is, to the extent provided in the
Indenture, subordinate and junior in right of payment to the prior payment in
full of all Senior Indebtedness, and this Debenture is issued subject to the
provisions of the Indenture with respect thereto.  Each holder of this Debenture, by accepting
the same, (a) agrees to and shall be bound by such provisions,
(b) authorizes and directs the Trustee on his or her behalf to take such
action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. 
Each holder hereof, by his or her acceptance hereof, hereby waives all
notice of the acceptance of the subordination provisions contained herein and
in the Indenture by each holder of Senior Indebtedness, whether now outstanding
or hereafter incurred, and waives reliance by each such holder upon said
provisions.


 


B-4





















 


This
Debenture shall not be entitled to any benefit under the Indenture hereinafter
referred to, be valid or become obligatory for any purpose until the
certificate of authentication hereon shall have been signed by or on behalf of
the Trustee.


 


Capitalized
terms used and not defined in this Debenture shall have the meanings assigned
in the Indenture dated as of the date of original issuance of this Debenture
between the Trustee and the Company.


 


IN
WITNESS WHEREOF, the Company has duly executed this certificate.


 


	
   

  	
  FIRST REGIONAL BANCORP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


 


CERTIFICATE OF
AUTHENTICATION


 


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


 


	
   

  	
  State Street Bank and
  Trust Company of Connecticut,

  National Association, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  



 


B-5





















 


EXHIBIT C


 


PLACEMENT AGREEMENT


 


C-1