<PAGE>   1
                -------------------------------------------------



                                  EXHIBIT 10.1

                        AMENDED AND RESTATED DECLARATION
                                    OF TRUST

                         COMMUNITY (AL) CAPITAL TRUST I

                           Dated as of March 23, 2000



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


                                       59

<PAGE>   2


TABLE OF CONTENTS


                                    ARTICLE I
                         INTERPRETATION AND DEFINITIONS

<TABLE>
<CAPTION>

    <S>              <C>                                                                                     <C>
    SECTION 1.1      Definitions............................................................................  1


                                   ARTICLE II
                                  ORGANIZATION

    SECTION 2.1      Name...................................................................................  9
    SECTION 2.2      Office.................................................................................  9
    SECTION 2.3      Purpose................................................................................  9
    SECTION 2.4      Authority..............................................................................  9
    SECTION 2.5      Title to Property of the Trust.........................................................  9
    SECTION 2.6      Powers and Duties of the Trustees and the Administrators...............................  9
    SECTION 2.7      Prohibition of Actions by the Trust and the Trustees................................... 13
    SECTION 2.8      Powers and Duties of the Institutional Trustee......................................... 14
</TABLE>

                                       i
<PAGE>   3

<TABLE>
<CAPTION>

    <S>              <C>                                                                                     <C>
    SECTION 2.9      Certain Duties and Responsibilities of the Trustees and Administrators................. 16
    SECTION 2.10     Certain Rights of Institutional Trustee................................................ 17
    SECTION 2.11     Delaware Trustee....................................................................... 19
    SECTION 2.12     Execution of Documents................................................................. 20
    SECTION 2.13     Not Responsible for Recitals or Issuance of Securities................................. 20
    SECTION 2.14     Duration of Trust...................................................................... 20
    SECTION 2.15     Mergers................................................................................ 20


                                   ARTICLE III
                                     SPONSOR

    SECTION 3.1      Sponsor's Purchase of Common Securities................................................ 22
    SECTION 3.2      Responsibilities of the Sponsor........................................................ 22


                                   ARTICLE IV
                           TRUSTEES AND ADMINISTRATORS

    SECTION 4.1      Number of Trustees..................................................................... 22
    SECTION 4.2      Delaware Trustee....................................................................... 23
    SECTION 4.3      Institutional Trustee; Eligibility..................................................... 23
    SECTION 4.4      Certain Qualifications of the Delaware Trustee Generally............................... 23
    SECTION 4.5      Administrators......................................................................... 23
    SECTION 4.6      Delaware Trustee....................................................................... 24
    SECTION 4.7      Appointment, Removal and Resignation of Trustees and Administrators.................... 24
    SECTION 4.8      Vacancies Among Trustees............................................................... 25
    SECTION 4.9      Effect of Vacancies.................................................................... 26
    SECTION 4.10     Meetings of the Trustees and the Administrators........................................ 26
    SECTION 4.11     Delegation of Power.................................................................... 26
    SECTION 4.12     Conversion, Consolidation or Succession to Business.................................... 27


                                    ARTICLE V
                                  DISTRIBUTIONS

    SECTION 5.1      Distributions.......................................................................... 27
</TABLE>


                                       ii
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<TABLE>
<CAPTION>

                                   ARTICLE VI
                             ISSUANCE OF SECURITIES

    <S>              <C>                                                                                     <C>
    SECTION 6.1      General Provisions Regarding Securities................................................ 27
    SECTION 6.2      Paying Agent, Transfer Agent and Registrar............................................. 28
    SECTION 6.3      Form and Dating........................................................................ 28
    SECTION 6.4      Mutilated, Destroyed, Lost or Stolen Certificates...................................... 29
    SECTION 6.5      Temporary Securities................................................................... 29
    SECTION 6.6      Cancellation........................................................................... 30
    SECTION 6.7      Rights of Holders; Waivers of Past Defaults............................................ 30


                                   ARTICLE VII
                      DISSOLUTION AND TERMINATION OF TRUST

    SECTION 7.1      Dissolution and Termination of Trust................................................... 32


                                  ARTICLE VIII
                              TRANSFER OF INTERESTS

    SECTION 8.1      General................................................................................ 33
    SECTION 8.2      Transfer Procedures and Restrictions................................................... 34
    SECTION 8.3      Deemed Security Holders................................................................ 35


                                   ARTICLE IX
                           LIMITATION OF LIABILITY OF
                    HOLDERS OF SECURITIES, TRUSTEES OR OTHERS

    SECTION 9.1      Liability.............................................................................. 36
    SECTION 9.2      Exculpation............................................................................ 36
    SECTION 9.3      Fiduciary Duty......................................................................... 36
    SECTION 9.4      Indemnification........................................................................ 37
    SECTION 9.5      Outside Businesses..................................................................... 40
    SECTION 9.6      Compensation; Fee...................................................................... 40


                                    ARTICLE X
                                   ACCOUNTING

    SECTION 10.1     Fiscal Year............................................................................ 41
    SECTION 10.2     Certain Accounting Matters............................................................. 41
</TABLE>

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<TABLE>
<CAPTION>
    <S>              <C>                                                                                     <C>
    SECTION 10.3     Banking................................................................................ 41
    SECTION 10.4     Withholding............................................................................ 42


                                   ARTICLE XI
                             AMENDMENTS AND MEETINGS

    SECTION 11.1     Amendments............................................................................. 42
    SECTION 11.2     Meetings of the Holders of Securities; Action by Written Consent....................... 44


                                   ARTICLE XII
                        REPRESENTATIONS OF INSTITUTIONAL
                          TRUSTEE AND DELAWARE TRUSTEE


    SECTION 12.1     Representations and Warranties of Institutional Trustee................................ 45
    SECTION 12.2     Representations and Warranties of Delaware Trustee..................................... 46


                                  ARTICLE XIII
                                  MISCELLANEOUS

    SECTION 13.1     Notices................................................................................ 47
    SECTION 13.2     Governing Law.......................................................................... 48
    SECTION 13.3     Intention of the Parties............................................................... 48
    SECTION 13.4     Headings............................................................................... 48
    SECTION 13.5     Successors and Assigns................................................................. 48
    SECTION 13.6     Partial Enforceability................................................................. 49
    SECTION 13.7     Counterparts........................................................................... 49
</TABLE>


                                        1

<PAGE>   6

                    AMENDED AND RESTATED DECLARATION OF TRUST

                                       OF

                         COMMUNITY (AL) CAPITAL TRUST I

                                 March 23, 2000

         AMENDED AND RESTATED DECLARATION OF TRUST (this "Declaration") dated
and effective as of March 23, 2000, by the Trustees (as defined herein), the
Administrators (as defined herein), the Sponsor (as defined herein) and the
holders, from time to time, of undivided beneficial interests in the Trust (as
defined herein) to be issued pursuant to this Declaration;

         WHEREAS, certain of the Trustees, the Administrators and the Sponsor
established COMMUNITY (AL) CAPITAL TRUST I (the "Trust"), a statutory business
trust under the Delaware Business Trust Act pursuant to a Declaration of Trust
dated as of March 7, 2000 (the "Original Declaration"), and a Certificate of
Trust filed with the Secretary of State of the State of Delaware on March 10,
2000, 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;

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

         NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a statutory business trust under the Business Trust Act
(as defined herein) and that this Declaration constitutes the governing
instrument of such statutory business trust, the Trustees declare 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.

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;

         (e) a term defined in the Trust Indenture Act (as defined herein) has
the same meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires; and


                                        2
<PAGE>   7

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

         "Additional Interest" has the meaning set forth in Section 3.06 of the
Indenture.

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

         "Administrators" means each of Denny Kelly and Elaine Corvin, 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 enters 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 appoints a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of such Person or for any substantial part of
its property, or orders the winding-up or liquidation of its affairs, and such
decree, appointment or order remains unstayed and in effect for a period of 90
consecutive days; or

         (b) such Person commences a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, consents
to the entry of an order for relief in an involuntary case under any such law,
or consents 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 makes any general
assignment for the benefit of creditors, or fails 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 are permitted or required by any
applicable any applicable law to close.

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

         "Capital Securities" has the meaning set forth in 6.1(a).

         "Capital Security Certificate" means a Certificate 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.


                                        3

<PAGE>   8

         "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.

         "Commission" means the Securities and Exchange Commission.

         "Common Securities" has the meaning set forth in Section 6.1(a).

         "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.

         "Comparable Treasury Issue" has the meaning set forth in paragraph 4(a)
of Annex I.

         "Comparable Treasury Price" has the meaning set forth in paragraph 4(a)
of Annex I.

         "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 101 Barclay Street, Floor 21 West,
New York, NY 10286.

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

         "Debenture Issuer" means Community Bancshares Inc., a bank holding
company incorporated in Delaware, in its capacity as issuer of the Debentures
under the Indenture.

         "Debenture Trustee" means The Bank of New York, as trustee under the
Indenture until a successor is appointed thereunder, and thereafter means such
successor trustee.

         "Debentures" means the 10 7/8% Junior Subordinated Deferrable Interest
Debentures due 2030 to be issued by the Debenture Issuer under the Indenture.

         "Deferred Interest" means any interest on the Debentures that would
have been overdue and unpaid for more than one Distribution Payment Date but for
the imposition of an Extension Period, and the interest that shall accrue (to
the extent that the payment of such interest is legally enforceable) on such
interest at the rate per annum equal to 10 7/8%, compounded semi-annually from
the date on which such Deferred Interest would otherwise have been due and
payable until paid or made available for payment.

         "Definitive Capital Securities" means any Capital Securities in
definitive form


                                        4

<PAGE>   9

issued by the Trust.

         "Delaware Trustee" has the meaning set forth in Section 4.2.

         "Direct Action" has the meaning set forth in Section 2.8(e).

         "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.

         "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;

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

         (c) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Trustees in this Declaration (other than those
specified in clause (b) above) and continuation of such default or breach for a
period of 30 days after there has been given, by registered or certified mail to
the Trustees 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.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.

         "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,
the Delaware Trustee, any Affiliate of the Institutional Trustee or the Delaware
Trustee, and any officers, directors, shareholders, members, partners,
employees, representatives, custodians, nominees or agents of the Institutional
Trustee and the Delaware Trustee.

         "Fiscal Year" has the meaning set forth in Section 10.1

         "Guarantee" means the guarantee agreement to be dated as of March 23,
2000, of the Sponsor in respect of the Capital Securities.


                                        5

<PAGE>   10

         "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 Business Trust Act.

         "Indemnified Person" means a Company Indemnified Person or a Fiduciary
Indemnified Person.

         "Indenture" means the Indenture dated as of March 23, 2000, among the
Debenture Issuer and the Debenture Trustee, and any indenture supplemental
thereto pursuant to which the Debentures are to be issued.

         "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 4.3.

         "interest" means any interest due on the Debentures, including any
Deferred Interest and Defaulted Interest (as each such term is defined in the
Indenture).

         "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.

         "Legal Action" has the meaning set forth in Section 2.8(e).

         "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.

         "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
provided 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;


                                        6

<PAGE>   11

         (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.

         "Paying Agent" has the meaning specified in Section 6.2.

         "Payment Amount" has the meaning set forth in Section 5.1.

         "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 E.

         "PORTAL" has the meaning set forth in Section 2.6(a)(i).

         "Primary Treasury Dealer" has the meaning set forth in paragraph 4(a)
of Annex I.

         "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.

         "QIB" means a "qualified institutional buyer" as defined under Rule
144A of the Securities Act.

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

         "Quotation Agent" 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.

         "Registrar" has the meaning set forth in Section 6.2.

         "Reference Treasury Dealer" has the meaning set forth in paragraph 4(a)
of Annex I.

         "Reference Treasury Dealer Quotations" has the meaning set forth in
paragraph 4(a) of Annex I.


                                        7

<PAGE>   12

         "Relevant Trustee" has the meaning set forth in Section 4.7(a).

         "Remaining Life" has the meaning set forth in paragraph 4(a) of Annex
I.

         "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(c).

         "Rule 144A" means Rule 144A under the Securities Act.

         "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.

         "Sponsor" means Community Bancshares Inc., a bank holding company
incorporated in Delaware, or any successor entity in a merger, consolidation or
amalgamation, in its capacity as sponsor of the Trust.

         "Successor Delaware Trustee" has the meaning set forth in Section
4.7(a).

         "Successor Entity" has the meaning set forth in Section 2.15(b).

         "Successor Institutional Trustee" has the meaning set forth in Section
4.7(a).

         "Successor Securities" has the meaning set forth in Section 2.15(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.


                                       8
<PAGE>   13

         "Transfer Agent" has the meaning set forth in Section 6.2.

         "Treasury Rate" has the meaning set forth in paragraph 4(a) of Annex I.

         "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 Indenture Act" means the Trust Indenture Act of 1939, as
amended.

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

         "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 a Section
7701(a)(30) of the Code.

ARTICLE II

ORGANIZATION

         SECTION 2.1 Name. The Trust is named "Community (AL) Capital 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
68149 Main Street, Blountsville, Alabama 35031. On ten 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 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 and (c) 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.


                                       9
<PAGE>   14

         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 a Trustee
in accordance with its powers shall constitute the act of and serve to bind the
Trust. In dealing with the Trustees acting on behalf of the Trust, no Person
shall be required to inquire into the authority of the Trustees to bind the
Trust. Persons dealing with the Trust are entitled to rely conclusively on the
power and authority of the Trustees as set forth in this Declaration. 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.

         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.

         SECTION 2.6 Powers and Duties of the Trustees and the Administrators.

         (a) The Trustees 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 Trustees and the Administrators shall
have the authority to enter into all transactions and agreements determined by
the Trustees to be appropriate in exercising the authority, express or implied,
otherwise granted to the Trustees 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) if and at such time determined by the Sponsor at the
         request of the Holders, assisting in the designation of the Capital
         Securities for trading in the Private Offering, Resales and Trading
         through the Automatic Linkages ("PORTAL") system;

                  (E) 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;


                                       10

<PAGE>   15

                  (F) 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;

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

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

                  (I) unless otherwise determined by the Institutional Trustee
         or the Holders of a Majority in liquidation amount of the Securities or
         as otherwise required by the Business 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;

                  (J) the taking of any action incidental to the foregoing as
         the Institutional Trustee may from time to time determine is necessary
         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);

                  (K) 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

                  (L) 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 Trustees 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;


                                       11

<PAGE>   16

                  (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 Delaware;

                  (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 business trust under
         the laws of the State of Delaware 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.

         (b)      So long as this Declaration remains in effect, the Trust (or
the Trustees 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 Trustees 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 cause the Trust to fail or
cease to qualify as a "grantor trust" for United States federal income tax
purposes, (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;


                                       12

<PAGE>   17


         (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 Trustees 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 (i) the Trust will not be deemed to be an
"investment company" required to be registered under the Investment Company Act
and (ii) the Trust will not fail to be classified as a grantor trust for United
States federal income tax purposes. The Administrator 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 Holders of a Majority in liquidation amount of the Common
Securities are authorized to take any action, not inconsistent with applicable
laws, the Original Declaration or this Declaration, as amended from time to
time, that such Holders determine in their discretion to be necessary or
desirable for such purposes, even if such action adversely affects the interests
of the Holders of the Capital Securities.

         (e)      All expenses incurred by the Administrators or the Trustees
pursuant to this Section 2.6 shall be reimbursed by the Sponsor, and the
Trustees 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 for the benefit of the Trust and
neither the Administrators nor the Holders in accordance with this Declaration.

         SECTION 2.7 Prohibition of Actions by the Trust and the Trustees.

         (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;


                                       13

<PAGE>   18


         (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;

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

         (vii) 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.

         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. 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 4.7. 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 or to the Delaware Trustee.

         (c) The Institutional Trustee shall:

         (i) establish and maintain a segregated non-interest bearing trust
      account (the "Property Account") in the United States (as defined in
      Treasury Regulations section 301.7701-7), 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 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;


                                       14


<PAGE>   19

               (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 shall take all actions and
perform such duties as may be specifically required of the Institutional Trustee
pursuant to the terms of the Securities.

               (e)   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 (a "Legal Action")
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 the
Institutional Trustee's duties and obligations under this Declaration or the
Trust Indenture Act; 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 a Holder of the Common
Securities may exercise such right of subrogation only so long as an Event of
Default with respect to the Capital Securities has occurred and is continuing.

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

               (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; or

               (ii)  a Successor Institutional Trustee has been appointed and
         has accepted that appointment in accordance with Section 4.7.

               (g)   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.

                                       15


<PAGE>   20

                  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
Trustees and Administrators.

                  (a) The Institutional Trustee, before the occurrence of any
Event of Default and after the curing of all 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 Trustees and the
Administrators shall be as provided by this Declaration and, in the case of the
Institutional Trustee, by the Trust Indenture Act. Notwithstanding the
foregoing, no provision of this Declaration shall require the Trustees 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. 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 Trustees or
Administrators shall be subject to the provisions of this Article. Nothing in
this Declaration shall be construed to release an Administrator or Trustee from
liability for its own negligent action, its own negligent failure to act, or its
own willful misconduct. To the extent that, at law or in equity, a Trustee or an
Administrator has duties and liabilities relating to the Trust or to the
Holders, such Trustee or Administrator shall not be liable to the Trust or to
any Holder for such Trustee's or 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 Trustees 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 Trustees.

                  (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 Property to the extent
legally available for distribution to it as herein provided and that the
Trustees 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
Trustees expressly set forth elsewhere in this Declaration or, in the case of
the Institutional Trustee, in the Trust Indenture Act.


                                       16

<PAGE>   21

                  (d) No provision of this Declaration shall be construed to
relieve the Institutional Trustee from liability with respect to matters that
are within the authority of the Institutional Trustee under this Declaration for
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 or 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, safe keeping 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 own account, subject to the protections and limitations on
         liability afforded to the Institutional Trustee under this Declaration
         and the Trust Indenture Act;

                  (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


                                       17


<PAGE>   22

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 terms of this Declaration, the Institutional Trustee may deliver a notice to
the Sponsor requesting the Sponsor's opinion 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 directed, 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, upon the occurrence of an Event of
Default, of its obligation to exercise the rights and powers vested in it by
this Declaration;

                  (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

                                       18


<PAGE>   23

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 be given only 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 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;

                  (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 Delaware Trustee. Notwithstanding any other
provision of this Declaration other than Section 4.2, the Delaware Trustee shall
not be entitled to exercise any powers, nor shall the Delaware Trustee have any
of the duties and responsibilities of any of the Trustees or the Administrators
described in this Declaration. Except as set forth in Section 4.2, the Delaware
Trustee shall be a Trustee for the sole and limited purpose of fulfilling the


                                       19




<PAGE>   24

requirements of ss. 3807 of the Business Trust Act.

                  SECTION 2.12 Execution of Documents. Subject to the provisions
of Section 2.11, unless otherwise determined in writing by the Institutional
Trustee, and except as otherwise required by the Business 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
Trustees or the Administrators, as the case may be, have the power and
authority to execute pursuant to Section 2.6.

                  SECTION 2.13 Not Responsible for Recitals or Issuance of
Securities. The recitals contained in this Declaration and the Securities shall
be taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration, the Debentures or the Securities.

                  SECTION 2.14 Duration of Trust. The Trust, unless dissolved
pursuant to the provisions of Article VII hereof, shall have existence for
fifty-five (55) years from the Closing Date.

                  SECTION 2.15 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 2.15(b) and (c).

                  (b) The Trust may, with the consent of the Institutional
Trustee and without the consent of the Delaware Trustee or 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 Survivor, 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 Institutional Trustee 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) the Capital Securities or any Successor Securities are
         listed, or any Successor Securities will be listed upon notification of
         issuance, on any national securities exchange or with another
         organization on which the Capital Securities are then



                                       20



<PAGE>   25

listed or quoted, if any;

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

                  (v)    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 (other than with respect to any dilution of such
         Holders' interests in the Successor Entity as a result of such merger,
         consolidation, amalgamation or replacement);

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

                  (vii)  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 (other than with
                  respect to any dilution of the Holders' interest in the
                  Successor Entity);

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

                           (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; and

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

                  (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 of this paragraph (b) to such
         transaction have been satisfied.

                  (c) Notwithstanding Section 2.15(b), the Trust shall not,
except with the consent of Holders of 100% in liquidation amount of the
Securities, consolidate, amalgamate, merge with or into, or to 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.



                                       21

<PAGE>   26

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 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;

                  (b) to prepare for filing and request the Administrators to
cause the filing by the Trust, as may be appropriate, of an application to the
PORTAL system, for listing or quotation upon notice of issuance of any Capital
Securities, if required ; and

                  (c) 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.

ARTICLE IV

TRUSTEES AND ADMINISTRATORS

                  SECTION 4.1 Number of Trustees. The number of Trustees
initially shall be two, and:

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

                  (b) after the issuance of any Securities, the number of
Trustees may be increased or decreased by vote of the Holders of a Majority in
liquidation amount of the Capital Securities voting as a class at a meeting of
the Holders of the Capital Securities; provided, however, that there shall be a
Delaware Trustee if required by Section 4.2; and there shall always be one
Trustee who shall be the Institutional Trustee, and such Trustee may also serve
as Delaware Trustee if it meets the applicable requirements, in which case
Section 2.11 shall have no application to such entity in its capacity as
Institutional Trustee.


                                       22

<PAGE>   27

                  SECTION 4.2 Delaware Trustee. If required by the Business
Trust Act, one Trustee (the "Delaware Trustee") shall be:

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

                  (b) if not a natural person, an entity which is organized
under the laws of the United States or any State thereof or the District of
Columbia, has its principal place of business in the State of Delaware, and
otherwise meets the requirements of applicable law, including ss.3807 of the
Business Trust Act.

                  SECTION 4.3 Institutional Trustee; Eligibility.   (a) There
shall at all times be one Trustee which shall act as 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 organized and doing business
         under the laws of the United States of America or any State thereof or
         of 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), 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
         4.3(a)(ii), the combined capital and surplus of such corporation shall
         be deemed to be its combined capital and surplus as set forth in its
         most recent report of condition so published.

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

                  (c) If the Institutional Trustee has or shall acquire any
"conflicting interest" within the meaning of ss. 310(b) of the Trust Indenture
Act, 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 The Bank of New
York.

                  SECTION 4.4 Certain Qualifications of the Delaware Trustee
Generally. The Delaware Trustee shall be a U.S. Person and either a natural
person who is at least 21 years of age or a legal entity that shall act through
one or more Authorized Officers.

                  SECTION 4.5 Administrators.  Each Administrator shall be a
U.S. Person. The initial Administrators shall be Denny Kelly and Elaine Corvin.
There shall at all times be at least one Administrator.

                  Except where a requirement for action by a specific number of
Administrators is


                                       23


<PAGE>   28

expressly set forth in this 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 4.6 Initial Delaware Trustee.  The initial Delaware
Trustee shall be The Bank of New York (Delaware).

                  SECTION 4.7 Appointment, Removal and Resignation of Trustees
and Administrators.

                  (a) No resignation or removal of any Trustee (the "Relevant
Trustee") and no appointment of a successor Trustee pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of this Section 4.7.

                  Subject to the immediately preceding paragraph, a Relevant
Trustee may resign at any time by giving written notice thereof to the Holders
of the Securities and by appointing a successor Relevant Trustee. Upon the
resignation of the Institutional Trustee, the Institutional Trustee shall
appoint a successor by requesting from each of Bank One Trust Company, NA,
Bankers Trust Company and State Street Bank & Trust Company, 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 Relevant Trustee required by Section 4.7 shall not
have been delivered to the Relevant Trustee within 60 days after the giving of
such notice of resignation or delivery of the instrument of removal, the
Relevant 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 Relevant Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a Relevant Trustee. The
Institutional Trustee shall have no liability for the selection of such
successor pursuant to this Section 4.7.

                  The Institutional Trustee or the Delaware Trustee, or both of
them, may be removed by the act of the Holders of a Majority in liquidation
amount of the Capital Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust) if an Event of Default shall
have occurred and be continuing. If any 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 Relevant Trustee,
shall promptly appoint a successor Relevant Trustee or Trustees, and such
successor Trustee shall comply with the applicable requirements of this Section
4.7. If no successor Relevant 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 4.7, within 30 days
after delivery of an instrument of removal, the Relevant Trustee or any Holder
who has been a Holder of the Securities for at least six 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 a
successor Relevant Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a successor Relevant Trust or
Trustees.


                                       24

<PAGE>   29

                  The Institutional Trustee shall give notice of each
resignation and each removal of a Trustee and each appointment of a successor
Trustee to all Holders in the manner provided in Section 4.7(b) and shall give
notice to the Sponsor. Each notice shall include the name of the successor
Relevant Trustee and the address of its Corporate Trust Office if it is the
Institutional Trustee.

                  Notwithstanding the foregoing or any other provision of this
Declaration, in the event a Delaware Trustee who is a natural person dies or
becomes incompetent or incapacitated, the vacancy created by such death,
incompetence or incapacity may be filled by the Institutional Trustee following
the procedures in this Section 4.7 (with the successor being a Person who
satisfies the eligibility requirement for a Delaware Trustee set forth in this
Declaration) (the "Successor Delaware Trustee").

                  (b) In case of the appointment hereunder of a successor
Relevant Trustee, the retiring Relevant Trustee and each successor Relevant
Trustee with respect to the Trust Securities shall execute and deliver an
amendment hereto wherein each successor Relevant Trustee shall accept such
appointment and which (a) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Relevant
Trustee all the rights, powers, trusts and duties of the retiring Relevant
Trustee with respect to the Securities and the Trust and (b) shall add to or
change any of the provisions of this Declaration as shall be necessary to
provide for or facilitate the administration of the Trust by more than one
Relevant Trustee, it being understood that nothing herein or in such amendment
shall constitute such Relevant Trustees co-trustees and upon the execution and
delivery of such amendment the resignation or removal of the retiring Relevant
Trustee shall become effective to the extent provided therein and each such
successor Relevant Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Relevant Trustee; but, on request of the Trust of any successor Relevant Trustee
such retiring Relevant Trustee shall duly assign, transfer and deliver to such
successor Relevant Trustee all Trust Property, all proceeds thereof and money
held by such retiring Relevant Trustee hereunder with respect to the Securities
and the Trust.

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

                  (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 4.8 Vacancies Among Trustees. If a Trustee ceases to
hold office for any reason and the number of Trustees is not reduced pursuant to
Section 4.1, or if the number of Trustees is increased pursuant to Section 4.1,
a vacancy shall occur. A resolution certifying the existence of such vacancy by
the Trustees or, if there are more than two, a majority of the Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with an a Trustee appointed in accordance with Section 4.7.

                  SECTION 4.9 Effect of Vacancies. The death, resignation,
retirement, removal, bankruptcy, dissolution, liquidation, incompetence or
incapacity to perform the duties of a



                                       25



<PAGE>   30

Trustee shall not operate to dissolve, terminate or annul the Trust. Whenever a
vacancy in the number of Trustees shall occur, until such vacancy is filled by
the appointment of a Trustee in accordance with Section 4.7, the Institutional
Trustee shall have all the powers granted to the Trustees and shall discharge
all the duties imposed upon the Trustees by this Declaration.

                  SECTION 4.10 Meetings of the Trustees and the Administrators.
Meetings of the Trustees or the Administrators shall be held from time to time
upon the call of any Trustee or Administrator, as applicable. Regular meetings
of the Trustees and the Administrators, respectively, may be in person in the
United States or by telephone, at a place (if applicable) and time fixed by
resolution of the Trustees or the Administrators, as applicable. Notice of any
in- person meetings of the Trustees or 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 Trustees or 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 a Trustee or an Administrator, as the case may be, at a meeting
shall constitute a waiver of notice of such meeting except where a 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 ground that the meeting has
not been lawfully called or convened. Unless provided otherwise in this
Declaration, any action of the Trustees or the Administrators, as the case may
be, may be taken at a meeting by vote of a majority of the Trustees or 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 Trustees or the Administrators.
Meetings of the Trustees and the Administrators together shall be held from the
time to time upon the call of any Trustee or Administrator.

                  SECTION 4.11 Delegation of Power. (a)  Any Trustee or any
Administrator, as the case may be, 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 Trustees shall have power to delegate from time to
time to such of their number or to any officer of the Trust that is a U.S.
Person, the doing of such things and the execution of such instruments either in
the name of the Trust or the names of the Trustees or otherwise as the Trustees
may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of the Trust, as set forth herein.

                                       26

<PAGE>   31

                  SECTION 4.12 Conversion, Consolidation or Succession to
Business. Any Person into which the Institutional Trustee or the Delaware
Trustee, as the case may be, may be merged or converted or with which either may
be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Institutional Trustee or the Delaware Trustee, as the
case may be, shall be a party, or any Person succeeding to all or substantially
all the corporate trust business of the Institutional Trustee or the Delaware
Trustee, as the case may be, shall be the successor of the Institutional Trustee
or the Delaware Trustee, as the case may be, 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 (including
any Additional Interest or Deferred Interest) and/or principal on the Debentures
held by the Institutional Trustee (the amount of any such payment being a
"Payment Amount"), the Institutional Trustee shall and is directed, to the
extent funds are available for that purpose, to make a distribution (a
"Distribution") of the Payment Amount 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 (the "Capital Securities") 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 "Common
Securities"). 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 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.

                  (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 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


                                       27


<PAGE>   32

such person 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 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 non-assessable.

                  (e) Every Person, by virtue of having become a Holder or a
Capital Security Beneficial Owner 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 New York, New York, an office or agency where the
Capital Securities may be presented for payment (the "Paying Agent"), and an
office or agency where Securities may be presented for registration of transfer
(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 and 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 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 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


                                       28

<PAGE>   33

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 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 terms of this Declaration and to the extent
applicable, the Institutional Trustee, the Delaware 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 $1,000.

                  The Capital Securities are being offered and sold by the Trust
pursuant to the Placement Agreement in definitive, registered form without
coupons 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 their 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 bona fide 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 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.

                                       29

<PAGE>   34

                  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 and when issued and delivered to
Holders against payment of the purchase price therefor will be fully paid and
nonassessable by the Trust.

                  (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 at least 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 at least 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 Sponsor 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 Deferred 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 Deferred
                  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


                                       30


<PAGE>   35

         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 5.07 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 under the Indenture,
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 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.

                  (d) 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 Trust Agreement, 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:


                                       31

<PAGE>   36

                  (i)   unless earlier dissolved, on March 8, 2055, 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 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, 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;

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

                  (vi)  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

                  (vii) before the issuance of any Securities, with the consent
         of all of the Trustees and the Sponsor.

                  (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 Section 3808 of
the Business 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 Delaware.

                  (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) 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


                                       32



<PAGE>   37

the Securities remain outstanding, the Sponsor shall maintain 100% ownership of
the Common Securities; provided, however, that any permitted successor of the
Sponsor 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 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.

                  SECTION 8.2        Transfer Procedures and Restrictions.

                  (a) General. (i) 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 New York, 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 or that such Securities are not
"restricted" within the meaning of Rule 144 under 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) Transfer and Exchange of Capital Securities. When Capital



                                       33



<PAGE>   38

Securities are presented to the Registrar (x) to register the transfer of such
Capital Securities, or (y) to exchange such Capital Securities for an equal
number of Capital Securities of another number, the Registrar shall register the
transfer or make the exchange as requested if its reasonable requirements for
such transaction are met; provided, however, that the Capital Securities
surrendered for registration of transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form reasonably satisfactory
to the Trust and the Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing and (i) if such Capital Securities are being
transferred to a QIB, accompanied by a certificate of the transferee
substantially in the form set forth as Exhibit C hereto or (ii) if such Capital
Securities are being transferred otherwise than to a QIB, accompanied by a
certificate of the transferee substantially in the form set forth as Exhibit B
hereto.

                  (c) Legend. Except as permitted by Section 8.2(a), each
Capital Security shall bear a legend (the "Restricted Securities Legend") in
substantially the following form:

                  THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
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. THE HOLDER OF
THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE
TRANSFER SUCH SECURITY ONLY (A) TO THE DEBENTURE ISSUER OR THE TRUST, (B)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (C) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT
IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN
"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 (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE DEBENTURE
ISSUER'S AND THE TRUST'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSES (C) OR (D) 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 DEBENTURE ISSUER OR THE TRUST. THE HOLDER OF THIS SECURITY AGREES THAT IT
WILL COMPLY WITH THE FOREGOING RESTRICTIONS.

                  (d)                Obligations with Respect to Transfers and
Exchanges of Capital Securities.


                                       34

<PAGE>   39

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

                  (ii)  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.

                  (iii) The Registrar shall not be required to register the
         transfer of or exchange of any Capital Security during a period
         beginning at the opening of business 15 days before the day of any
         selection of any Capital Security for redemption set forth in the terms
         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 Capital Securities to be redeemed.

                  (iv)  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 Trustees, 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 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 Trustees, 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, TRUSTEES 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; and

                  (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.


                                       35

<PAGE>   40


                  (c) Pursuant to ss. 3803(a) of the Business 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 Delaware.

                  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.

                  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 (other than the duties imposed on the
Institutional Trustee under the Trust Indenture Act), 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) (i) 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) by



                                       36



<PAGE>   41

reason of the fact that he is or was an Indemnified Person against expenses
(including 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.

                  (ii)  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 by reason of the fact that he is or was an Indemnified
         Person against expenses (including 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 and except 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 of Chancery of Delaware
         or 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 of
         Chancery or such other court shall deem proper.

                  (iii) 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 (i) and (ii) of this Section 9.4(a), 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.

                  (iv)  Any indemnification of an Administrator under paragraphs
         (i) and (ii) of this Section 9.4(a) (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 (i) and (ii). Such determination shall
         be made (A) by the Administrators by a majority vote of a Quorum
         consisting of such Administrators who were not parties to such action,
         suit or proceeding, (B) 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 (C) by the Common
         Security Holder of the Trust.

                  (v)   To the fullest extent permitted by law, expenses
         (including attorneys' fees and expenses) incurred by an Indemnified
         Person in defending a civil, criminal,



                                       37


<PAGE>   42

         administrative or investigative action, suit or proceeding referred to
         in paragraphs (i) and (ii) of this Section 9.4(a) 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(a). Notwithstanding the foregoing, no
         advance shall be made by the Sponsor if a determination is reasonably
         and promptly made (A) by the Administrators by a majority vote of a
         Quorum of disinterested Administrators, (B) 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 (C) 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 Person
         did not believe to be in or not opposed to 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 Person
         deliberately breached his duty to the Trust or its Common or Capital
         Security Holders.

                  (vi) Each 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 hereunder or
         against it by relation to the foregoing, without affecting its right to
         indemnification hereunder or waiving any rights afforded to it under
         this Declaration or applicable law.

                  (b) The Sponsor shall indemnify, to the fullest extent
permitted by applicable law, each Indemnified Person from and against any and
all loss, damage, liability, tax, penalty, expense or claim of any kind or
nature whatsoever incurred by such Indemnified Person arising out of or in
connection with or by reason of the creation, operation or termination of the
Trust, or any act or omission performed or omitted by such Indemnified Person in
good faith on behalf of the Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred on such
Indemnified Person by this Declaration, except that no Indemnified Person shall
be entitled to be indemnified in respect of any loss, damage or claim incurred
by such Indemnified Person by reason of gross negligence or willful misconduct
with respect to such acts or omissions.

                  (c) 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.


                                       38

<PAGE>   43

                  (d) 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.

                  (e) 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.

                  (f) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section 9.4 shall, unless otherwise provided
when authorized or ratified, 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.

                  The provisions of this Section shall survive the termination
of this agreement or the earlier resignation or removal of the Institutional
Trustee. The obligations of the Sponsor under this Section 9.4 to compensate and
indemnify the Trustees and to pay or reimburse the Trustees for expenses,
disbursements and advances shall constitute additional indebtedness hereunder.
Such additional indebtedness shall be secured by a lien prior to that of the
Securities upon all property and funds held or collected by the Trustees as
such, except funds held in trust for the benefit of the holders of particular
Securities.

                  SECTION 9.5 Outside Businesses. Any Covered Person, the
Sponsor, the Delaware Trustee and the Institutional Trustee (subject to Section
4.3(c)) may engage in or possess an interest in other business ventures of any
nature or description, independently or with others, similar or dissimilar to
the 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, the Delaware Trustee 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, the Delaware Trustee 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, the Delaware Trustee 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.


                                       39


<PAGE>   44

                  SECTION 9.6 Compensation; Fee.  The Sponsor agrees:

                  (a) to pay to the Trustees from time to time such compensation
for all services rendered by them 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 Trustees upon request for all reasonable expenses, disbursements
and advances incurred or made by the Trustees 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 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 any 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.

ARTICLE X

ACCOUNTING

                  SECTION 10.1 Fiscal Year. The fiscal year (the "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 on the accrual method of accounting, 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 prepared at the
principal office of the Trust in the United States, as defined for purposes of
Treasury regulations section 301.7701-7, and delivered to each of the Holders of
Securities, within 90 days after the end of each Fiscal Year of the Trust,
annual financial statements of the Trust, including a balance sheet of the Trust
as of the end of such Fiscal Year, and the related statements of income or loss
which shall be examined by and reported upon by a firm of independent certified
public accountants selected by the Administrators.

                  (c) 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


                                       40


<PAGE>   45

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.

                  (d) The Administrators shall cause to be duly prepared 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.

                  (e) So long as the only Holder of the Capital Securities is
Regional Diversified Funding Limited, the Administrators will cause the
Sponsor's reports on Form FR Y-9C, FR Y-9LP and FR Y-6 to be delivered to the
Holder promptly following their filing with the Federal Reserve.

                  SECTION 10.3 Banking. The Trust shall maintain one or more
bank accounts in the United States, as defined for purposes of Treasury
regulations section 301.7701-7, 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 to the Holder
in the amount of the withholding. In the event of any claimed overwithholding,
Holders shall be limited to an action against the applicable jurisdiction. If
the amount required to be withheld was not withheld from actual Distributions
made, the Institutional Trustee or any Paying Agent may reduce subsequent
Distributions by the amount of such withholding.



ARTICLE XI

AMENDMENTS AND MEETINGS





                                       41
<PAGE>   46

                  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

                  (i)      the Institutional Trustee, and

                  (ii)     if the amendment affects the rights, powers, duties,
         obligations or immunities of the Delaware Trustee, the Delaware
         Trustee.

                  (b)      Notwithstanding any other provision of this Article
XI, no amendment shall be made, and any such purported amendment shall be void
and ineffective:

                  (i)      unless 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)     if the result of such amendment would be to

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

                           (B) reduce or otherwise adversely affect the powers
                  of the Institutional Trustee in contravention of the Trust
                  Indenture Act;

                           (C) cause the Trust to be deemed to be an Investment
                  Company required to be registered under the Investment Company
                  Act; or

                           (D) cause the Debenture Issuer to be unable to treat
                  an amount equal to the Liquidation Amount of the Debentures as
                  "Tier 1 Capital" for purposes of the capital adequacy
                  guidelines of the Federal Reserve.

                  (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 (ii) restrict
the right of a Holder to institute suit for the enforcement of any such payment
on or after such date.

                                       42

<PAGE>   47

                  (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.

                  (g) the rights of the Holders of the Capital Securities under
Article IV to increase or decrease the number of, and appoint and remove,
Trustees 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 the 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; and

                 (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 right, 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 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, the terms of
the Securities or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading, if any. 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


                                       43

<PAGE>   48

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 or the rules of any
         stock exchange on which the Capital Securities are listed or admitted
         for trading, if any, 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 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 Delaware relating to proxies, and judicial interpretations
         thereunder, as if the Trust were a Delaware corporation and the Holders
         of the Securities were stockholders of a Delaware corporation; 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 Business Trust Act, this Declaration, the
         terms of the Securities, the Trust Indenture Act or the listing rules
         of any stock exchange on which the Capital Securities are then listed
         for trading, if any, 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).



                                       44


<PAGE>   49

ARTICLE XII

REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE

                  SECTION 12.1 Representations and Warranties of Institutional
Trustee. The Trustee that acts as 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 banking corporation with
trust powers, duly organized, validly existing and in good standing under the
laws of the United States 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);

                  (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.

                  SECTION 12.2 Representations and Warranties of Delaware
Trustee. The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee, that:

                  (a) The Delaware Trustee is duly organized, validly existing
and in good standing under the laws of the State of Delaware, 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 Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and this Declaration. This
Declaration under Delaware law constitutes a legal, valid and binding obligation
of the Delaware 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


                                       45


<PAGE>   50

of equity (regardless of whether considered in a proceeding in equity or at
law).

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

                  (d) The Delaware Trustee is a natural person who is a resident
of the State of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware and, in either case, a
Person that satisfies for the Trust the requirements of Section 3807 of the
Business Trust Act.

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:

                                    Community (AL) Capital Trust I

                                    c/o Community Bancshares, Inc.
                                    68149 Main Street

                                    Blountsville, Alabama 35031

                                    Attention: Administrators of Community (AL)
                                    Capital Trust I





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

                                    The Bank of New York (Delaware)
                                    White Clay Center, Route 273

                                    Newark, Delaware
                                    Attention: Corporate Trust Administration

                                    Telecopy:



                                       46

<PAGE>   51


                  (c) 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):



                                    The Bank of New York
                                    101 Barclay Street, Floor 21W

                                    New York, NY 10286
                                    Attention: Corporate Trust Administration

                                    Telecopy: 212-819-5915

                  (d) 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):

                                    Community Bancshares, Inc.
                                    68149 Main Street

                                    Blountsville, Alabama 35031
                                    Attention: Kennon R. Patterson, Sr.,
                                    Chairman and Chief Executive Officer

                                    Copy to: William H. Caughran, Assistant
                                    Secretary

                  (e) 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 Delaware and all rights and remedies shall be governed
by such laws without regard to the principles of conflict of laws of the State
of Delaware or any other jurisdiction that would call for the application of the
law of any jurisdiction other than the State of Delaware; provided, however,
that there shall not be applicable to the Trust, the Trustees or this
Declaration any provision of the laws (statutory or common) of the State of
Delaware 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)



                                       47


<PAGE>   52

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, (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 or (g)
the establishment of fiduciary or other standards of responsibility or
limitations on the acts or powers of trustees that are inconsistent with the
limitations or liabilities or authorities and powers of the Trustees as set
forth or referenced in this Declaration. Section 3540 of Title 12 of the
Delaware Code shall not apply to the Trust.

                  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 Trustees 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 Trustees 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.



                                       48

<PAGE>   53






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

                            THE BANK OF NEW YORK (DELAWARE)
                               as Delaware Trustee


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


                            THE BANK OF NEW YORK
                               as Institutional Trustee


                            By:/s/ Annette L. Kos
                               -----------------------------------------------
                               Name: Annette L. Kos
                               Title: Assistant Vice President


                            COMMUNITY BANCSHARES, INC.
                               as Sponsor


                            By:/s/ Kennon R. Patterson, Sr.
                               -----------------------------------------------
                               Name: Kennon R. Patterson, Sr.
                               Title: Chairman, President and Chief
                               Executive Officer


                            COMMUNITY (AL) CAPITAL TRUST I


                            By:/s/ Denny Kelly
                               -----------------------------------------------
                               Administrator


                            By:/s/ Elaine E. Corvin
                               -----------------------------------------------
                               Administrator





<PAGE>   54






ANNEX I

TERMS OF FIXED RATE CAPITAL TRUST PASS-THROUGH SECURITIES(R) (TRUPS(R))


         Pursuant to Section 6.1 of the Amended and Restated Declaration of
Trust, dated as of March 23, 2000 (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) Capital Securities. 10,000 Capital
Securities of Community (AL) Capital Trust I (the "Trust"), with an aggregate
stated liquidation amount with respect to the assets of the Trust of Ten Million
Dollars ($10,000,000) and a stated liquidation amount with respect to the assets
of the Trust of $1,000 per Capital Security, are hereby designated for the
purposes of identification only as the "Fixed Rate Capital Trust Pass- through
Securities"(R) (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 or to conform
to the rules of any stock exchange on which the Capital Securities are listed,
if any.


         (b)      Common Securities. 310 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 payable on each Security will
be payable at an annual rate equal to 10 7/8% (the "Coupon Rate") of the stated
liquidation amount of $1,000 per Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee. Except as set
forth below in respect of an Extension Period, Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). The term
"Distributions" as used herein includes cash distributions and any such
compounded distributions payable 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. The amount of Distributions payable for any period
will be computed for any full semi-annual period on the basis of a 360-day year
of twelve 30-day months.


         (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, semi-annually in
arrears on March 8 and September 8 of each year, commencing on September 8, 2000
(each, a "Distribution Payment Date") when, as and if available for payment. The
Debenture Issuer has the right under the Indenture to defer


<PAGE>   55

payments of interest on the Debentures by extending the interest payment period
for up to 10 consecutive semi-annual periods (each, an "Extension Period") at
any time and from time to time on the Debentures, subject to the conditions
described below, although such interest would continue to accrue on the
Debentures, and interest will accrue on such Deferred Interest at an annual rate
equal to 10 7/8%, compounded semi-annually 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 Deferred Interest; provided, however, that no Extension
Period may extend beyond the Maturity Date and provided further, that, during
any such Extension Period, the Debenture Issuer may 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 capital stock
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 that
rank pari passu in all respects with or junior in interest to the Debentures
(other than (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
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (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). 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 10 consecutive
semi-annual periods, or extend beyond the Maturity Date. Upon the termination of
any Extension Period and upon the payment of all Deferred Interest, the
Debenture Issuer may commence a new Extension Period, subject to the foregoing
requirements. No interest or Deferred 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 Deferred Interest. If Distributions are deferred, the Distributions
due shall be paid on the date that the related Extension Period terminates, or,
if such date is not a Distribution Payment Date, on the immediately following
Distribution Payment Date, 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


<PAGE>   56

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 selected by the Administrators,
which dates shall be 15 days before the relevant payment dates. 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 aggregate of the
stated liquidation amount of $1,000 per Security plus accrued and unpaid
Distributions thereon to the date of payment (such amount being the "Liquidation
Distribution"), unless in connection with such Liquidation, the Debentures in an
aggregate stated principal amount equal to the aggregate stated liquidation
amount of such Securities, with an interest rate equal to the Coupon 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 Section 3808(e) of the Business 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 Tax Event, an


<PAGE>   57

Investment Company Event or a Capital Treatment Event), subject to the receipt
by the Debenture Issuer of prior approval from the Board of Governors of the
Federal Reserve System (the "Federal Reserve"), if then required under
applicable capital guidelines or policies of the Federal Reserve 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.


         The Trust shall dissolve on the first to occur of (i) March 8, 2055,
the expiration of the term of the Trust, (ii) a Bankruptcy Event with respect to
the Sponsor, 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 of the Sponsor or upon revocation of the charter of
the Sponsor and the expiration of 90 days after the date of revocation without a
reinstatement thereof, (iv) the distribution to the Holders of the Securities of
the Debentures, upon exercise of the right of the Holder of all of the
outstanding Common Securities to dissolve the Trust as described above, (v) the
entry of a decree of a judicial dissolution of the Sponsor or the Trust, or (vi)
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. As soon as practicable after the
dissolution of the Trust and upon completion of the winding up of the Trust, the
Trust shall terminate upon the filing of a certificate of cancellation with the
Secretary of State of the State of Delaware.


         If a Liquidation of the Trust occurs as described in clause (i), (ii),
(iii) or (v) in the immediately preceding paragraph, the Trust shall be
liquidated by the Trustees of the Trust as expeditiously as such Trustees
determine 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) above 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.


         Upon any such Liquidation of the Trust involving a distribution of the
Debentures, if at the time of such Liquidation, the Capital Securities were
rated by at least one nationally-recognized statistical rating organization, the
Debenture Issuer will use its reasonable


<PAGE>   58






best efforts to obtain from at least one such or other rating organization a
rating for the Debentures.


         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, and (ii) any certificates representing the Capital Securities 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 of, 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.

         4.       Redemption and Distribution.


         (a)      The Debentures will mature on March 8, 2030. The Debentures
may be redeemed by the Debenture Issuer, in whole or in part, on any March 8 or
September 8 on or after March 8, 2010, at the Redemption Price, upon not less
than 30 days nor more than 60 day's notice to Holders of such Debentures. In
addition, upon the occurrence and continuation of a Tax Event, an Investment
Company Event or a Capital Treatment Event, the Debentures may be redeemed by
the Debenture Issuer in whole but not in part, at any time within 90 days
following the occurrence of such Tax Event, Investment Company Event or Capital
Treatment Event, as the case may be (the "Special Redemption Date"), at the
Special Redemption Price, upon not less than 30 nor more than 60 days' notice
to Holders of the Debentures so long as such Tax Event, Investment Company Event
or Capital Treatment Event, as the case may be, 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
then required under applicable capital guidelines or policies of the Federal
Reserve.


         "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 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


<PAGE>   59






minimis amount of other taxes, duties or other governmental charges.


         "Investment Company Event" means the receipt by 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 of 1940, as amended 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.


         "Capital Treatment Event" means the reasonable determination by the
Debenture Issuer that, as a result of the occurrence of any amendment to, or
change (including any announced prospective change) in, the laws 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
issuance of the Debentures, there is more than an insubstantial risk that the
Debenture Issuer will not be entitled to treat an amount equal to the aggregate
Liquidation Amount of the Debentures as "Tier I Capital" (or the then equivalent
thereof) for purposes of the capital adequacy guidelines of the Federal Reserve,
as then in effect and applicable to the Debenture Issuer; provided, however,
that the distribution of the Debentures in connection with the Liquidation of
the Trust by the Debenture Issuer 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.






         "Special Event" means any of a Capital Treatment Event, a Tax Event or
an Investment Company Event.


         "Redemption Price" means the price set forth in the following table for
any Redemption Date or Special Redemption Date that occurs within the
twelve-month period beginning in the relevant year indicated below, expressed in
percentage of the principal amount of the Debt Securities being redeemed:

<TABLE>
<CAPTION>

                              Year              Percentage
                              ----              ----------
                         <S>                    <C>
                         March 8, 2010           105.438
                         March 8, 2011           104.894
                         March 8, 2012           104.350
                         March 8, 2013           103.806
                         March 8, 2014           103.263

</TABLE>


<PAGE>   60





<TABLE>

                    <S>                          <C>
                         March 8, 2015           102.719
                         March 8, 2016           102.175
                         March 8, 2017           101.631
                         March 8, 2018           101.088
                         March 8, 2019           100.544
                    March 8, 2020 and after      100.000
</TABLE>


         plus accrued and unpaid interest on such Debentures to the Redemption
Date or, in the case of a redemption due to the occurrence of a Special Event,
to the Special Redemption Date.


         "Special Redemption Price" means (1) if the Special Redemption Date is
before March 8, 2010, the greater of (a) 100% of the principal amount of the
Debentures being redeemed and (b) as determined by a Quotation Agent, the sum of
the present values of scheduled payments of principal and interest from the
Special Redemption Date to March 8, 2010 (the "Remaining Life") discounted to
the Special Redemption Date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Treasury Rate plus 0.45%, plus, in
the case of either (a) or (b), accrued and unpaid interest on such Debentures to
the Special Redemption Date and (2) if the Special Redemption Date is on or
after March 8, 2010, the Redemption Price for such Special Redemption Date.


         "Comparable Treasury Issue" means with respect to any Special
Redemption Date the United States Treasury security selected by the Quotation
Agent as having a maturity comparable to the Remaining Life that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the Remaining Life. If no United States Treasury security has a
maturity which is within a period from three months before to three months after
March 8, 2010, the two most closely corresponding United States Treasury
securities shall be used as the Comparable Treasury Issue, and the Treasury Rate
shall be interpolated or extrapolated on a straight-line basis, rounding to the
nearest month using such securities.


         "Comparable Treasury Price" means (a) the average of five Reference
Treasury Dealer Quotations for such Special Redemption Date, after excluding the
highest and lowest such Reference Treasury Dealer Quotations, or (b) if the
Quotation Agent obtains fewer than five such Reference Treasury Dealer
Quotations, the average of all such Quotations.


         "Primary Treasury Dealer" shall mean a primary United States Government
securities dealer in New York City.


         "Quotation Agent" means Salomon Smith Barney, Inc. and its successors;
provided, however, that if the foregoing shall cease to be a primary United
States Government securities dealer in New York City (a "Primary Treasury
Dealer"), the Debenture Issuer shall substitute therefor another Primary
Treasury Dealer.


         "Redemption Date" shall mean the date fixed for the redemption of
Capital Securities, which shall be any March 8 or September 8 commencing on
March 8, 2010.


<PAGE>   61







         "Reference Treasury Dealer" means (i) the Quotation Agent and (ii) any
other Primary Treasury Dealer selected by the Debenture Trustee after
consultation with the Company.


         "Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as determined by
the Quotation Agent, of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted in
writing to the Debenture Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third Business Day preceding such Redemption Date.


         "Treasury Rate" means (i) the yield, under the heading which represents
the average for the week immediately prior to the date of calculation, appearing
in the most recently published statistical release designated H.15 (519) or any
successor publication which is published weekly by the Federal Reserve and which
establishes yields on actively traded United States Treasury securities adjusted
to constant maturity under the caption "Treasury Constant Maturities", for the
maturity corresponding to the Remaining Life (if no maturity is within three
months before or after the Remaining Life, yields for the two published
maturities most closely corresponding to the Remaining Life shall be determined
and the Treasury Rate shall be interpolated or extrapolated from such yields on
a straight-line basis, rounding to the nearest month) or (ii) if such release
(or any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such Special Redemption Date. The Treasury Rate shall be calculated on the third
Business Day preceding the Special Redemption Date.


         (b)      Upon the repayment in full at maturity or redemption in whole
or in part of the Debenture (other than following the distribution of the
Debenture 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, Securities having an aggregate liquidation amount equal to the
aggregate principal amount of the Debenture 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 Debenture).


         (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 as described in Section
4(e)(ii) below.


         (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 semi-annual Distribution periods terminating on
or before the date of redemption.


<PAGE>   62






         (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 Section 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)     In the event that fewer than all the outstanding
Securities are to be redeemed, the Securities to be redeemed shall be redeemed
Pro Rata from each Holder of Capital Securities.



             (iii)    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 Section 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 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 specified in Section 4(a), but without interest on
such Redemption Price. If any date fixed for redemption of Securities is not a
Business Day, then payment of any such 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
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 then
applicable rate from the original


<PAGE>   63






         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. 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.

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

                           (v) 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 Sections 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, or
(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
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


<PAGE>   64

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 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 such Trust 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







<PAGE>   65

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 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 and the Delaware Trustee.



         6.           Voting Rights - Common Securities. (a) Except as provided
under Sections 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 V 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





<PAGE>   66

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 Section
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.

                  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 Trustees 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.




<PAGE>   67






                  (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 a 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 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 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


<PAGE>   68






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.

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"), OR ANY STATE SECURITIES LAWS. 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. THE HOLDER OF
THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE
TRANSFER SUCH SECURITY ONLY (A) TO THE DEBENTURE ISSUER OR THE TRUST, (B)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (C) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT
IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN
"ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN


<PAGE>   69






CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (D)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, SUBJECT TO THE DEBENTURE ISSUER'S AND THE TRUST'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C) OR (D) 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 DEBENTURE ISSUER OR THE TRUST.
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 MAY BE
REQUIRED BY THE DECLARATION TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS.






<PAGE>   70







Certificate Number P-1                      Number of Capital Securities: 10,000

CUSIP NO ___________

Certificate Evidencing Capital Securities

of

Community (AL) Capital Trust I

Fixed Rate Capital Pass-through Securities(R) (TRUPS(R))

(liquidation amount $1,000 per Capital Security)

         Community (AL) Capital Trust I , a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
______________ (the "Holder") is the registered owner of securities of the Trust
representing undivided beneficial interests in the assets of the Trust,
designated the Fixed Rate Capital Trust Pass-through Securities(R) (liquidation
amount $1,000 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 March 23, 2000, among
Denny Kelly and Elaine Corvin, as Administrators, The Bank of New York
(Delaware), as Delaware Trustee, The Bank of New York, as Institutional Trustee,
Community Bancshares, Inc., 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
the 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.

         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.




                                      A-1-3


<PAGE>   71






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


<PAGE>   72






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

                                       COMMUNITY (AL) CAPITAL TRUST I


                                       By:
                                          --------------------------------
                                          Name:
                                          Title: Administrator

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





CERTIFICATE OF AUTHENTICATION

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

                                      THE BANK OF NEW YORK, as the Institutional
                                          Trustee


                                      By:
                                         ---------------------------------
                                                 Authorized Officer

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


<PAGE>   73




[FORM OF REVERSE OF SECURITY]

                  Distributions payable on each Capital Security will be payable
at an annual rate of 10 7/8% (the "Coupon Rate") of the stated liquidation
amount of $1,000 per Capital Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee. Except as set
forth below in respect of an Extension Period, Distributions in arrears for more
than a semi-annual period will bear interest thereon compounded semi-annual at
the Coupon Rate (to the extent permitted by applicable law). The term
"Distributions" as used herein includes cash distributions, any such compounded
interest and any Additional Interest payable on the Debentures 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. The amount of
Distributions payable for any period will be computed for any full semi-annual
Distribution period on the basis of a 360-day year of twelve 30-day months.

                  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 semi-annually in arrears on March 8 and September 8
of each year, commencing on September 8, 2000. 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 10 consecutive semi-annual
periods (each, an "Extension Period") at any time and from time to time on the
Debentures, subject to the conditions described below, although such interest
would continue to accrue on the Debentures, and Interest will accrue on such
Deferred Interest, at an annual rate equal to 10 7/8%, compounded semi-annually
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 Deferred Interest then
accrued and unpaid on the Debentures; 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 10 consecutive semi-annual periods, or extend beyond
the Maturity Date. Upon the termination of any Extension Period and upon the
payment of all Deferred Interest, the Debenture Issuer may commence a new
Extension Period, subject to the foregoing requirements. No interest or Deferred
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 Deferred Interest. If
Distributions are deferred, the Distributions due shall be paid on the date that
the related Extension Period terminates, or, if such date is not a Distribution
Payment Date, on the immediately following Distribution Payment Date, 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.




<PAGE>   74




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

as 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.


<PAGE>   75




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 SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED.

Certificate Number                           C-1              Number of Common
Securities: 310

Certificate Evidencing Common Securities

of

Community (AL) Capital Trust I

                  Community (AL) Capital Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby certifies
that Community Bancshares, Inc. (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 March 23, 2000, among Denny Kelly and Elaine
Corvin, as Administrators, The Bank of New York (Delaware), as Delaware Trustee,
The Bank of New York, as Institutional Trustee, Community Bancshares, Inc., 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 the 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 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.




                                      A-2-1


<PAGE>   76




                  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 Delaware, without regard to principles
of conflict of laws.




<PAGE>   77




                  IN WITNESS WHEREOF, the Trust has executed this certificate
this 23rd day of March, 2000.

                                     COMMUNITY (AL) CAPITAL TRUST I


                                     By:
                                        ------------------------------
                                        Name:
                                        Title: Administrator





<PAGE>   78




[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 of 10 7/8% (the "Coupon Rate") of the stated liquidation amount of
$1,000 per Capital Security, such rate being the rate of interest payable on the
Debentures to be held by the Institutional Trustee. Except as set forth below in
respect of an Extension Period, Distributions in arrears for more than one
period will bear interest thereon compounded at the Coupon Rate (to the extent
permitted by applicable law). The term "Distributions" as used herein includes
cash distributions, any such compounded distribution and any Additional Interest
payable on the Debentures 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. The amount of Distributions payable for any period will be
computed for any full semi-annual Distribution period on 360-day year of twelve
30-day months.


         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 semi-annually in arrears on March 8 and September 8 of each
year, commencing on September 8, 2000. 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 10 consecutive semi-annual periods (each, an
"Extension Period") at any time and from time to time on the Debentures, subject
to the conditions described below, during which Extension Period no interest
shall be due and payable. No Extension Period may end on a date other than a
Distribution Payment Date. During an Extension Period, interest would continue
to accrue on the Debentures, and interest on such accrued interest (such accrued
interest and interest thereon referred to herein as "Deferred Interest") will
accrue at an annual rate equal to 10 7/8%, compounded semi-annually from the
date such Deferred Interest would have been payable were it not for the
Extension Period to the extent permitted by law during any Extension Period. At
the end of any such Extension Period the Debenture Issuer shall pay all Deferred
Interest then accrued and unpaid on the Debentures; 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 10 consecutive semi-annual
periods, or extend beyond the Maturity Date. Upon the termination of any
Extension Period and upon the payment of all Deferred Interest, the Debenture
Issuer may commence a new Extension Period, subject to the foregoing
requirements. No interest or Deferred 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 Deferred Interest. If Distributions are deferred, the Distributions
due shall be paid on the date that the related Extension Period terminates, or,
if such date is not a Distribution Payment Date, on the immediately following
Distribution Payment Date, 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.




<PAGE>   79





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




<PAGE>   80




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

as 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 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.


<PAGE>   81




EXHIBIT B

FORM OF TRANSFEREE CERTIFICATE
TO BE EXECUTED BY TRANSFEREES OTHER THAN QIBS

__________, [   ]

Community Bancshares, Inc.

Community (AL) Capital Trust I

68149 Main Street

Blountsville, AL 35031

       Re:   Purchase of $1,000 stated liquidation amount of Fixed Rate Capital
             Trust Pass-through Securities(R) (TruPS)(R) (the "Capital
             Securities") of Community (AL) Capital Trust I

Ladies and Gentlemen:

                  In connection with our purchase of the Capital Securities we
confirm that:

                  1. We understand that the Fixed Rate Capital Trust
Pass-through Securities(R) (the "Capital Securities") (including the guarantee
(the "Guarantee") of Community Bancshares, Inc. (the "Company") executed in
connection therewith) and the Fixed Rate Junior Subordinated Deferrable Interest
Debentures due 2030 (the "Subordinated Debt Securities") of the Company (the
Capital Securities, the Guarantee and the Subordinated Debt Securities together
being referred to herein as "Offered Securities"), have not been registered
under the Securities Act of 1933, as amended (the "Securities Act"), and may not
be offered or sold except as permitted in the following sentence. We agree on
our own behalf and on behalf of any investor account for which we are purchasing
the Offered Securities that, if, we decide to offer, sell or otherwise transfer
any such Offered Securities, such offer, sale or transfer will be made only (a)
to [_________] or [________], (b) pursuant to Rule 144A under the Securities
Act, to a person we reasonably believe is a qualified institutional buyer under
Rule 144A (a "QIB") that purchases for its own account or for the account of a
QIB and to whom notice is given that the transfer is being made in reliance on
Rule 144A, (c) to an "accredited investor" with the meaning of subparagraph (a)
(1), (2), (3) or (7) of Rule 501 under the Securities Act that is acquiring
Offered Securities for its own account or for the account of such an accredited
investor for investment purposes and not with a view to, or for offer or sale in
connection with, any distribution thereof in violation of the Securities Act, or
(d) pursuant to another available exemption from the registration requirements
of the Securities Act, subject in each of the foregoing cases to any
requirements of law that the disposition of our property or compliance with any
applicable state securities laws. The foregoing restrictions on resale will not
apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Offered Securities is proposed to be made pursuant to
clause (c) or (d) above the transferor shall deliver a letter from the
transferee substantially in the form of this letter to The Bank of New York as
Transfer Agent, which shall provide as applicable, among other things, that the
transferee is an "accredited investor" within the meaning of subparagraph (a)
(1), (2), (3) or (7) of Rule 501 under the Securities Act that






<PAGE>   82

is acquiring such Securities for investment purposes and not for distribution in
violation of the Securities Act. We acknowledge on our behalf and on behalf of
any investor account for which we are purchasing Securities that the [______]
and [__________] reserve the right prior to any offer, sale or other transfer
pursuant to clauses (d) or (e) to require the delivery of any opinion of
counsel, certifications and/or other information satisfactory to the Trust and
the Company. We understand that the certificates for any Offered Security that
we receive will bear a legend substantially to the effect of the foregoing.

                  2. We are an "accredited investor" with the meaning of
subparagraph (a) (1), (2), (3) or (7) of Rule 501 under the Securities Act
purchasing for our own account or for the account of such an "accredited
investor," and we are acquiring the Offered Securities for the investment
purposes and not with view to, or for offer or sale in connection with, any
distribution in violation of the Securities Act and we have such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of our investment in the Offered Securities, and we and any
account for which we are acting are each able to bear the economic risks of our
or its investment.

                  3. We are acquiring the Offered Securities purchased by us for
our own account (or for one or more accounts as to each of which we exercise
sole investment discretion and have authority to make, and do make, the
statements contained in this letter) and not with a view to any distribution of
the Offered Securities, subject, nevertheless, to the understanding that the
disposition of our property will at all times be and remain within our control.

                  4. In the event that we purchase any Capital Securities or any
Subordinated Debt Securities, we will acquire such Capital Securities having an
aggregate stated liquidation amount of not less than $1,000 or such Subordinated
Debt Securities having an aggregate principal amount not less than $1,000, for
our own account and for each separate account for which we are acting.

                  5. We acknowledge that we either (A) are not a fiduciary of a
pension, profit-sharing or other employee benefit plan subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") (a "Plan"), or an
entity whose assets include "plan assets" by reason of any Plan's investment in
the entity and are not purchasing the Offered Securities on behalf of or with
"plan assets" by reason of any Plan's investment in the entity and is not
purchasing the Offered Securities on behalf of or with "plan assets" of any Plan
or (B) are eligible for the exemptive relief available under one ore more of the
following prohibited transaction class exemptions ("PTCEs") issued by the U.S.
Department of Labor: PTCE 96-23, 95-60, 91-38, 90-1 or 84-14.

                  6. We acknowledge that [_________] and [_______] and others
will rely upon the truth and accuracy of the foregoing acknowledges,
representations, warranties and agreements and agree that if any of the
acknowledgments, representations, warranties and agreements deemed to have been
made by our purchase of the Offered Securities are no longer accurate, we shall
promptly notify the Initial Purchasers. If we are acquiring any Offered
Securities as a fiduciary or agent for one or more investor accounts, we
represent that we have sole discretion with respect to each such investor
account and that we have full power to make the foregoing acknowledgments,
representations and agreement on behalf of each such investor account.

                                        Very truly yours,


<PAGE>   83








                                           (Name of Purchaser)


                                        By:


                                        Date:



                  Upon transfer of the Offered Securities would be registered in
the name of the new beneficial owner as follows.

Name:

Address:

Taxpayer ID Number:



EXHIBIT C

FORM OF TRANSFEREE CERTIFICATE
TO BE EXECUTED FOR QIBs

__________, [   ]

Community Bancshares, Inc.

Community (AL) Capital Trust I

68149 Main Street

Blountsville, AL 35031

       Re: Purchase of $1,000 stated liquidation amount of Fixed Rate Capital
       Trust Pass-through Securities(R) (TRUPS)(R) (the "Capital Securities")
       of Community (AL) Capital Trust I

                  Reference is hereby made to the Amended and Restated
Declaration dated as of March 23, 2000 (the "Declaration") among Denny Kelly and
Elaine Corvin, as Administrators, The Bank of New York (Delaware), as Delaware
Trustee, The Bank of New York, as Institutional Trustee, Community Bancshares,
Inc., as Sponsor, and the holders from time to time of undivided beneficial
interest in the assets of Community (AL) Capital Trust I. Capitalized terms used
but not defined herein shall have the meanings given them in the Declaration.


<PAGE>   84




                  This letter relates to $[_______________] aggregate
liquidation amount of Capital Securities which are held in the name of [name of
transferor] (the "Transferor").

                  In connection with such request, and in respect to such
Capital Securities, the transferor does hereby certify that such Capital
Securities are being transferred in accordance with (i) the transfer
restrictions set forth in the Capital Securities and (ii) Rule 144A under the
United States Securities Act of 1933, as amended ("Rule 144A"), to a transferee
that the Transferor reasonably believes is purchasing the Capital Securities for
its own account or an account with respect to which the transferee exercises
sole investment discretion and the transferee and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A, in a
transaction meeting the requirements of Rule 144A and in accordance with
applicable securities laws of any state of the United States or any other
jurisdiction.

                  You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.





                                              (Name of Transferor)


                                           By:



                                              Name:
                                              Title:

                                           Date:






<PAGE>   85




EXHIBIT D

SPECIMEN OF INITIAL DEBENTURE






                                       D-1


<PAGE>   86




EXHIBIT E

PLACEMENT AGREEMENT