EX-4.17 AMENDED AND RESTATED DECLARATION OF TRUST



 





Exhibit 4 - (17)




 





AMENDED AND RESTATED DECLARATION

OF TRUST




by and among




WILMINGTON TRUST COMPANY,

as Delaware Trustee,




WILMINGTON TRUST COMPANY,

as Institutional Trustee,




PEOPLES COMMUNITY BANCSHARES, INC.,

as Sponsor,




and




NEIL D. MCCURRY, JR. and DOROTHY S. BARTH,

as Administrators,




Dated as of December 15, 2005




 






 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page
	ARTICLE I INTERPRETATION AND DEFINITIONS
	 	 	1	 
	Section 1.1. Definitions
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II ORGANIZATION
	 	 	8	 
	Section 2.1. Name
	 	 	8	 
	Section 2.2. Office
	 	 	8	 
	Section 2.3. Purpose
	 	 	8	 
	Section 2.4. Authority
	 	 	8	 
	Section 2.5. Title to Property of the Trust
	 	 	8	 
	Section 2.6. Powers and Duties of the Trustees and the Administrators
	 	 	8	 
	Section 2.7. Prohibition of Actions by the Trust and the Institutional Trustee
	 	 	12	 
	Section 2.8. Powers and Duties of the Institutional Trustee
	 	 	12	 
	Section 2.9. Certain Duties and Responsibilities of the Trustees and Administrators
	 	 	14	 
	Section 2.10. Certain Rights of Institutional Trustee
	 	 	15	 
	Section 2.11. Delaware Trustee
	 	 	17	 
	Section 2.12. Execution of Documents
	 	 	17	 
	Section 2.13. Not Responsible for Recitals or Issuance of Securities
	 	 	17	 
	Section 2.14. Duration of Trust
	 	 	17	 
	Section 2.15. Mergers
	 	 	17	 
	 
	 	 	 	 
	ARTICLE III SPONSOR
	 	 	19	 
	Section 3.1. Sponsor’s Purchase of Common Securities
	 	 	19	 
	Section 3.2. Responsibilities of the Sponsor
	 	 	19	 
	Section 3.3. Expenses
	 	 	19	 
	Section 3.4. Right to Proceed
	 	 	20	 
	 
	 	 	 	 
	ARTICLE IV INSTITUTIONAL TRUSTEE AND ADMINISTRATORS
	 	 	20	 
	Section 4.1. Number of Trustees
	 	 	20	 
	Section 4.2. Delaware Trustee; Eligibility
	 	 	20	 
	Section 4.3. Institutional Trustee; Eligibility
	 	 	20	 
	Section 4.4. Administrators
	 	 	21	 
	Section 4.5. Appointment, Removal and Resignation of Trustees and Administrators
	 	 	21	 
	Section 4.6. Vacancies Among Trustees
	 	 	23	 
	Section 4.7. Effect of Vacancies
	 	 	23	 
	Section 4.8. Meetings of the Trustees and the Administrators
	 	 	23	 
	Section 4.9. Delegation of Power
	 	 	23	 
	Section 4.10. Conversion, Consolidation or Succession to Business
	 	 	23	 
	 
	 	 	 	 
	ARTICLE V DISTRIBUTIONS
	 	 	24	 
	Section 5.1. Distributions
	 	 	24	 
	 
	 	 	 	 
	ARTICLE VI ISSUANCE OF SECURITIES
	 	 	24	 
	Section 6.1. General Provisions Regarding Securities
	 	 	24	 
	Section 6.2. Paying Agent, Transfer Agent and Registrar
	 	 	25	 
	Section 6.3. Form and Dating
	 	 	25	 
	Section 6.4. Mutilated, Destroyed, Lost or Stolen Certificates
	 	 	25	 
	Section 6.5. Temporary Securities
	 	 	26	 






 i 




 









 





	 	 	 	 	 
	 	 	Page
	Section 6.6. Cancellation
	 	 	26	 
	Section 6.7. Rights of Holders; Waivers of Past Defaults
	 	 	26	 
	 
	 	 	 	 
	ARTICLE VII DISSOLUTION AND TERMINATION OF TRUST
	 	 	28	 
	Section 7.1. Dissolution and Termination of Trust
	 	 	28	 
	 
	 	 	 	 
	ARTICLE VIII TRANSFER OF INTERESTS
	 	 	28	 
	Section 8.1. General
	 	 	28	 
	Section 8.2. Transfer Procedures and Restrictions
	 	 	29	 
	Section 8.3. Deemed Security Holders
	 	 	31	 
	 
	 	 	 	 
	ARTICLE IX LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES,
INSTITUTIONAL TRUSTEE OR OTHERS
	 	 	31	 
	Section 9.1. Liability
	 	 	31	 
	Section 9.2. Exculpation
	 	 	32	 
	Section 9.3. Fiduciary Duty
	 	 	32	 
	Section 9.4. Indemnification
	 	 	33	 
	Section 9.5. Outside Businesses
	 	 	35	 
	Section 9.6. Compensation; Fee
	 	 	35	 
	 
	 	 	 	 
	ARTICLE X ACCOUNTING
	 	 	35	 
	Section 10.1. Fiscal Year
	 	 	35	 
	Section 10.2. Certain Accounting Matters
	 	 	35	 
	Section 10.3. Banking
	 	 	36	 
	Section 10.4. Withholding
	 	 	36	 
	 
	 	 	 	 
	ARTICLE XI AMENDMENTS AND MEETINGS
	 	 	36	 
	Section 11.1. Amendments
	 	 	36	 
	Section 11.2. Meetings of the Holders of Securities; Action by
Written Consent
	 	 	38	 
	 
	 	 	 	 
	ARTICLE XII REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND THE
DELAWARE TRUSTEE
	 	 	39	 
	Section 12.1. Representations and Warranties of Institutional Trustee
	 	 	39	 
	Section 12.2. Representations of the Delaware Trustee
	 	 	39	 
	 
	 	 	 	 
	ARTICLE XIII MISCELLANEOUS
	 	 	40	 
	Section 13.1. Notices
	 	 	40	 
	Section 13.2. Governing Law.
	 	 	41	 
	Section 13.3. Intention of the Parties
	 	 	41	 
	Section 13.4. Headings
	 	 	41	 
	Section 13.5. Successors and Assigns
	 	 	42	 
	Section 13.6. Partial Enforceability
	 	 	42	 
	Section 13.7. Counterparts
	 	 	42	 






	 	 	 
	Annex I

	 	Terms of Securities
	Exhibit A-1

	 	Form of Capital Security Certificate
	Exhibit A-2

	 	Form of Common Security Certificate
	Exhibit B

	 	Specimen of Initial Debenture
	Exhibit C

	 	Placement Agreement






 ii 




 









 






AMENDED AND RESTATED




DECLARATION OF TRUST




OF




PEOPLES COMMUNITY STATUTORY TRUST I




December 15, 2005




     AMENDED AND RESTATED DECLARATION OF TRUST (“Declaration”) dated and effective as of
December 15, 2005, by the Trustees (as defined herein), the Administrators (as defined herein), the
Sponsor (as defined herein) and by the holders, from time to time, of undivided beneficial
interests in the Trust (as defined herein) to be issued pursuant to this Declaration;



     WHEREAS, the Trustees, the Administrators and the Sponsor established Peoples Community Statutory
Trust I (the “Trust”), a statutory trust under the Statutory Trust Act (as defined herein)
pursuant to a Declaration of Trust dated as of December 5, 2005 (the “Original
Declaration”), and a Certificate of Trust filed with the Secretary of State of the State of
Delaware on December 5, 2005, for the sole purpose of issuing and selling certain securities
representing undivided beneficial interests in the assets of the Trust and investing the proceeds
thereof in certain debentures of the Debenture Issuer (as defined herein);



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




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



     NOW, THEREFORE, it being the intention of the parties hereto to continue the Trust as a statutory
trust under the Statutory Trust Act and that this Declaration constitutes the governing instrument
of such statutory trust, the 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. The parties hereto hereby agree as follows:




ARTICLE I




INTERPRETATION AND DEFINITIONS




Section 1.1. Definitions.




     Unless the context otherwise requires:



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



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




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



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



1









 





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



     “Acceleration Event of Default” has the meaning set forth in the Indenture.



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



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



     “Administrators” means each of Neil D. McCurry, Jr. and Dorothy S. Barth, solely in such Person’s
capacity as Administrator of the Trust created and continued hereunder and not in such Person’s
individual capacity, or such Administrator’s successor in interest in such capacity, or any
successor appointed as herein provided.

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



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



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



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



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



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



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



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



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



     “Certificate” means any certificate evidencing Securities.



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



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



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



2









 





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



     “Company Indemnified Person” means (a) any Administrator; (b) any Affiliate of any
Administrator;



     (c) any officers, directors, shareholders, members, partners, employees, representatives or
agents of any Administrator; or (d) any officer, employee or agent of the Trust or its Affiliates.



     “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 Rodney Square
North, 1100 North Market Street, Wilmington, Delaware 19890-1600, Attn: Corporate Trust
Administration.



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



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



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



     “Debenture Issuer” means Peoples Community Bancshares, Inc., a Florida corporation, in its
capacity as issuer of the Debentures under the Indenture.



     “Debenture Trustee” means Wilmington Trust Company, as trustee under the Indenture until a
successor is appointed thereunder, and thereafter means such successor trustee.



     “Debentures” means the Fixed/Floating Rate Junior Subordinated Deferrable Interest
Debentures due 2035 to be issued by the Debenture Issuer under the Indenture.



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



     “Delaware Trustee” has the meaning set forth in Section 4.2.



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



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



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



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



     “Distribution Period” means (i) with respect to the Distribution paid on the first
Distribution Payment Date, the period beginning on (and including) the date of original issuance
and ending on (but excluding) the Distribution Payment Date in March 2006 and (ii) thereafter, with
respect to a Distribution paid on each successive Distribution Payment Date, the period beginning
on (and including) the preceding Distribution Payment Date and ending on (but excluding) such
current Distribution Payment Date.



3









 





     “Distribution Rate” means, for the Distribution Period beginning on (and including) the
date of original issuance and ending on (but excluding) the Distribution Payment Date in December
2010, the rate per annum of 6.41%, and for each Distribution Period beginning on or after the
Distribution Payment Date in December 2010, the Coupon Rate for such Distribution Period.



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



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




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



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



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



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



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



     “Fiduciary Indemnified Person” shall mean each of the Institutional Trustee (including in
its individual capacity), the Delaware Trustee (including in its individual capacity), any
Affiliate of the Institutional Trustee or Delaware Trustee and any officers, directors,
shareholders, members, partners, employees, representatives, custodians, nominees or agents of the
Institutional Trustee or Delaware Trustee.



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



     “Fixed Rate Period Remaining Life” has the meaning set forth in paragraph 4(a) of Annex I.



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



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



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



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



4









 





     “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 Additional Interest and
Defaulted Interest.



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



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



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



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



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



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



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



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



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



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



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



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



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



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



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



5









 





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



     “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.



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



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



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



     “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.



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



     “Relevant Trustee” has the meaning set forth in Section 4.5(a).



     “Responsible Officer” means, with respect to the Institutional Trustee, any officer within
the Corporate Trust Office of the Institutional Trustee, including any vice-president, any
assistant vice-president, any assistant secretary, the treasurer, any assistant treasurer, any
trust officer or other officer of the Corporate Trust Office of the Institutional Trustee
customarily performing functions similar to those performed by any of the above designated officers
and also means, with respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer’s knowledge of and familiarity with the particular
subject.



     “Restricted Securities Legend” has the meaning set forth in Section 8.2(b). “Rule 3a-5”
means Rule 3a-5 under the Investment Company Act. “Rule 3a-7” means Rule 3a-7 under the Investment
Company Act. “Securities” means the Common Securities and the Capital Securities.



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



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



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



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



6









 





     “Sponsor” means Peoples Community Bancshares, Inc., a Florida corporation, or any successor
entity in a merger, consolidation or amalgamation, in its capacity as sponsor of the Trust.



     “Statutory Trust Act” means Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. §§
3801, et seq. as may be amended from time to time.



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



     “Successor Delaware Trustee” has the meaning set forth in Section 4.5(e). “Successor
Institutional Trustee” has the meaning set forth in Section 4.5(b). “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.



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



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



     “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 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.



     “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.



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



7









 





ARTICLE II




ORGANIZATION




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



     Section 2.2. Office. The address of the principal office of the Trust is c/o Wilmington
Trust Company, Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-1600. On
at least 10 Business Days written notice to the Holders of the Securities, the Administrators may
designate another principal office, which shall be in a state of the United States or in the
District of Columbia.



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



     Section 2.4. Authority. Except as specifically provided in this Declaration, the
Institutional Trustee shall have exclusive and complete authority to carry out the purposes of the
Trust. An action taken by 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. The Institutional Trustee shall have the
right, but shall not be obligated except as provided in Section 2.6, to perform those duties
assigned to the Administrators.



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



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 Institutional Trustee 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:



8









 






     (A) the issuance and sale of the Securities;




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




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




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




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




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




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




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




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




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




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




     (ii) As among the 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;



9









 






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




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




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




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




     (H) to the extent provided in this Declaration, the winding up of the affairs of and liquidation of
the Trust and the preparation, execution and filing of the certificate of cancellation with the
Secretary of State of the State of 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 trust under the laws of
the State of Delaware.




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



     (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 reasonably be expected (x) to cause
the Trust to fail or cease to qualify as a “grantor trust” for United States federal income tax
purposes or (y) to require the trust to register as an Investment Company under the Investment
Company Act, (iv) incur any indebtedness for borrowed money or issue any other debt or (v) take or
consent to any action that would result in the placement of a lien on any of the Trust Property.
The Institutional Trustee shall, at the sole cost and expense of the Trust, defend all claims and
demands of all Persons at any time claiming any lien on any of the Trust Property adverse to the
interest of the Trust or the Holders in their capacity as Holders.



     (c) In connection with the issuance and sale of the Capital Securities, the Sponsor shall have the
right and responsibility to assist the Trust with respect to, or effect on behalf of the Trust, the



10









 




following (and any actions taken by the Sponsor in furtherance of the following prior to the date
of this Declaration are hereby ratified and confirmed in all respects):





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




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




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




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



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



     (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 and the Administrators shall have no obligations
with respect to such expenses (for purposes of clarification, this Section 2.6(e) does not
contemplate the payment by the Sponsor of acceptance or annual administration fees owing to the
Trustees under this Declaration or the fees and expenses of the Trustees’ counsel in connection
with the closing of the transactions contemplated by this Declaration).



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



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



     (h) If the Institutional Trustee or any Holder has instituted any proceeding to enforce any right
or remedy under this Declaration and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Institutional Trustee or to such Holder, then and
in every such case the Sponsor, the Institutional Trustee and the Holders shall, subject to any
determination in such proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter



11









 




all rights and remedies of the Institutional Trustee and the Holders shall continue as though no
such proceeding had been instituted.




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




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




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




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




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




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




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




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




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




     (viii) other than as provided in this Declaration (including Annex I), (A) direct the time, method
and place of exercising any trust or power conferred upon the Debenture Trustee with respect to the
Debentures, (B) waive any past default that is waivable under the Indenture, (C) exercise any right
to rescind or annul any declaration that the principal of all the Debentures shall be due and
payable, or (D) consent to any amendment, modification or termination of the Indenture or the
Debentures where such consent shall be required unless the Trust shall have received a written
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 and the Holders of the Securities. The
right, title and interest of the Institutional Trustee to the Debentures shall vest automatically
in each Person who may hereafter be appointed as Institutional Trustee in accordance with Section
4.5. 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 name of and under the exclusive control of the Institutional Trustee,



12









 







and maintained in the Institutional Trustee’s trust department, on behalf of the Holders of the
Securities and, upon the receipt of payments of funds made in respect of the Debentures held by the
Institutional Trustee, deposit such funds into the Property Account and make payments, or cause the
Paying Agent to make payments, to the Holders of the Capital Securities and Holders of the Common
Securities from the Property Account in accordance with Section 5.1. Funds in the Property Account
shall be held uninvested until disbursed in accordance with this Declaration;




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




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



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



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




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




     (ii) a Successor Institutional Trustee has been appointed and has accepted that appointment in
accordance with Section 4.5.



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



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



13









 





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



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



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




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




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



14









 






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




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




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



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



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



     (b) if (i) in performing its duties under this Declaration, the Institutional Trustee is required
to decide between alternative courses of action, (ii) in construing any of the provisions of this
Declaration, the Institutional Trustee finds the same ambiguous or inconsistent with any other
provisions contained herein, or (iii) the
Institutional Trustee is unsure of the application of any provision of this Declaration, then,
except as to any matter as to which the Holders of Capital Securities are entitled to vote under
the terms of this Declaration, the Institutional Trustee may deliver a notice to the Sponsor
requesting the Sponsor’s written instructions as to the course of action to be taken and the
Institutional Trustee shall take such action, or refrain from taking such action, as the
Institutional Trustee shall be instructed in writing, in which event the Institutional Trustee
shall have no liability except for its own negligence or willful misconduct;

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



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



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



15









 





     (f) the Institutional Trustee may consult with counsel of its selection (which counsel may be
counsel to the Sponsor or any of its Affiliates) and the advice of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon and in accordance with such advice; the
Institutional Trustee shall have the right at any time to seek instructions concerning the
administration of this Declaration from any court of competent jurisdiction;



     (g) the Institutional Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Declaration at the request or direction of any of the Holders pursuant to this
Declaration, unless such Holders shall have offered to the Institutional Trustee security or
indemnity reasonably satisfactory to it against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction; provided, that nothing
contained in this Section 2.10(g) shall be taken to relieve the Institutional Trustee, subject to
Section 2.9(b), upon the occurrence of an Event of Default (that has not been cured or waived
pursuant to Section 6.7), to exercise such of the rights and powers vested in it by this
Declaration, and use the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own affairs;



     (h) the Institutional Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond, debenture, note or other evidence of indebtedness or other
paper or document, unless requested in writing to do so by one or more Holders, but the
Institutional Trustee may make such further inquiry or investigation into such facts or matters as
it may see fit;



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



     (j) whenever in the administration of this Declaration the Institutional Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or right or taking any other
action hereunder the Institutional Trustee (i) may request instructions from the Holders of the
Capital Securities which instructions may only be given by the Holders of the same proportion in
liquidation amount of the Capital Securities as would be entitled to direct the Institutional
Trustee under the terms of the Capital Securities in respect of such remedy, right or action, (ii)
may refrain from enforcing such remedy or right or taking such other action until such instructions
are received, and (iii) shall be fully protected in acting in accordance with such instructions;



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



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



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



16









 





     (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 4.1, 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 may be required under the Statutory
Trust Act). Except as set forth in Section 4.1, the Delaware Trustee shall be a Trustee for the
sole and limited purpose of fulfilling the requirements of § 3807 of the Statutory Trust Act.



     Section 2.12. Execution of Documents. Unless otherwise determined in writing by the
Institutional Trustee, and except as otherwise required by the Statutory Trust Act, the
Institutional Trustee, or any one or more of the Administrators, as the case may be, is authorized
to execute on behalf of the Trust any documents that the 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 earlier dissolved pursuant to the
provisions of Article VII hereof, shall be in existence for 35 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 Section 2.15(b) and (c) and except in connection with the
liquidation of the Trust and the distribution of the Debentures to Holders of Securities pursuant
to Section 7.1(a)(iv) of the Declaration or Section 4 of Annex I.



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




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




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



17









 






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




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




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




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




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




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




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




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




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




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




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




     (ix) prior to such merger, consolidation, amalgamation or replacement, the Institutional Trustee
shall have received an Officers’ Certificate of the Administrators and an opinion of counsel, each
to the effect that all conditions precedent under this Section 2.15(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 aggregate liquidation amount of the Securities, consolidate, amalgamate, merge with or
into, or be replaced by any other entity or permit any other entity to consolidate, amalgamate,
merge with or into, or replace it if such consolidation, amalgamation, merger or replacement would
cause the Trust or



18









 




Successor Entity to be classified as other than a grantor trust for United States federal income
tax purposes.




ARTICLE III




SPONSOR




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



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



     (a) to determine the States in which to take appropriate action to qualify the Trust or 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, to protect the limited liability of the Holders of the Capital Securities or to enable the
Trust to effect the purposes for which it was created; and



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



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



     (a) pay all reasonable costs and expenses owing to the Debenture Trustee pursuant to Section 6.6 of
the Indenture;



     (b) be responsible for and shall pay all debts and obligations (other than with respect to the
Securities) and all costs and expenses of the Trust, the offering, sale and issuance of the
Securities (including fees to the placement agents in connection therewith), the costs and expenses
(including reasonable counsel fees and expenses) of the Institutional Trustee and the
Administrators, the costs and expenses relating to the operation of the Trust, including, without
limitation, costs and expenses of accountants, attorneys, statistical or bookkeeping services,
expenses for printing and engraving and computing or accounting equipment, Paying Agents,
Registrars, Transfer Agents, duplicating, travel and telephone and other telecommunications
expenses and costs and expenses incurred in connection with the acquisition, financing, and
disposition of Trust assets and the enforcement by the Institutional Trustee of the rights of the
Holders (for purposes of clarification, this Section 3.3(b) does not contemplate the payment by the
Sponsor of acceptance or annual administration fees owing to the Trustees pursuant to the services
to be provided by the Trustees under this Declaration or the fees and expenses of the Trustees’
counsel in connection with the closing of the transactions contemplated by this Declaration); and



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



     The Sponsor’s obligations under this Section 3.3 shall be for the benefit of, and shall be
enforceable by, any Person to whom such debts, obligations, costs, expenses and taxes are owed



19









 




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




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



ARTICLE IV




INSTITUTIONAL TRUSTEE AND ADMINISTRATORS




     Section 4.1. Number of Trustees. The number of Trustees shall initially 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 Holder of a Majority in liquidation amount of the Common Securities voting as a class
at a meeting of the Holder of the Common 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.



     Section 4.2. Delaware Trustee; Eligibility.




     (a) If required by the Statutory Trust Act, one Trustee (the “Delaware Trustee”) shall be:




     (i) a natural person at least 21 years of age who is a resident of the State of Delaware; or




     (ii) 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 § 3807 of the Statutory
Trust Act.



     (b) The initial Delaware Trustee shall be Wilmington Trust Company.



     Section 4.3. Institutional Trustee; Eligibility.




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




     (i) not be an Affiliate of the Sponsor;




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




     (iii) be a banking corporation or trust company organized and doing business under the laws of the
United States of America or any state thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus of at least 50
million U.S. dollars ($50,000,000.00), and subject to supervision or examination by Federal, state,
or District of Columbia authority. If such corporation publishes



20









 






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)(iii), the
combined capital and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.



     (b) If at any time the Institutional Trustee shall cease to be eligible to so act under Section
4.3(a), the Institutional Trustee shall immediately resign in the manner and with the effect set
forth in Section 4.5.



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



     (d) The initial Institutional Trustee shall be Wilmington Trust Company.



     Section 4.4. Administrators. Each Administrator shall be a U.S. Person, 21 years of age or
older and authorized to bind the Sponsor. The initial Administrators shall be Neil D. McCurry, Jr.
and Dorothy S. Barth. There shall at all times be at least one Administrator. Except where a
requirement for action by a specific number of Administrators is expressly set forth in this
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 4.5. 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
4.5.



     (b) Subject to Section 4.5(a), 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 at least three Persons meeting the eligibility requirements their 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 this
Section 4.5 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 4.5.



     (c) Unless an Event of Default shall have occurred and be continuing, any Trustee may be removed at
any time by an act of the Holders of a Majority in liquidation amount of the Common Securities. If
any Trustee shall be so removed, the Holders of the Common Securities, by act of the Holders of a
Majority in liquidation amount of the Common Securities delivered to the Relevant Trustee, shall
promptly appoint a successor Relevant Trustee, and such successor Trustee shall comply with the
applicable requirements of this Section 4.5. If an Event of Default shall have occurred and be
continuing, 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



21









 




(in its individual capacity and on behalf of the Trust). 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 4.5. 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 4.5 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 Trustee or Trustees.




     (d) 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 and 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.



     (e) Notwithstanding the foregoing or any other provision of this Declaration, in the event a
Delaware Trustee who is a natural person dies or is adjudged by a court to have become 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 4.5 (with the successor being a
Person who satisfies the eligibility requirement for a Delaware Trustee set forth in this
Declaration) (the “Successor Delaware Trustee”).



     (f) In case of the appointment hereunder of a successor Relevant Trustee, the retiring Relevant
Trustee and each successor Relevant Trustee with respect to the 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 or 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
subject to the payment of all unpaid fees, expenses and indemnities of such retiring Relevant
Trustee.



     (g) 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.



     (h) 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 Holders of the Common
Securities.



     (i) Any successor Delaware Trustee shall file an amendment to the Certificate of Trust with the
Secretary of State of the State of Delaware identifying the name and principal place of business of
such Delaware Trustee in the State of Delaware.




22











 





     Section 4.6. 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, 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 a Trustee appointed in accordance with Section 4.5.



     Section 4.7. Effect of Vacancies. The death, resignation, retirement, removal,
bankruptcy, dissolution, liquidation, incompetence or incapacity to perform the duties of a Trustee
shall not operate to dissolve, terminate or annul the Trust or terminate this Declaration. 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 4.5, 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 4.8. Meetings of the Trustees and the Administrators. Meetings of the
Administrators shall be held from time to time upon the call of an Administrator. Regular meetings
of the Administrators may be held in person in the United States or by telephone, at a place (if
applicable) and time fixed by resolution of the Administrators. Notice of any in-person meetings of
the Trustees with the Administrators or meetings of the Administrators shall be hand delivered or
otherwise delivered in writing (including by facsimile, with a hard copy by overnight courier) not
less than 48 hours before such meeting. Notice of any telephonic meetings of the Trustees with the
Administrators or meetings of the Administrators or any committee thereof shall be hand delivered
or otherwise delivered in writing (including by facsimile, with a hard copy by overnight courier)
not less than 24 hours before a meeting. Notices shall contain a brief statement of the time, place
and anticipated purposes of the meeting. The presence (whether in person or by telephone) of a
Trustee or an Administrator, as the case may be, at a meeting shall constitute a waiver of notice
of such meeting except where the Trustee or an Administrator, as the case may be, attends a meeting
for the express purpose of objecting to the transaction of any activity on the grounds that the
meeting has not been lawfully called or convened. Unless provided otherwise in this Declaration,
any action of the 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 time to time upon the call of
any Trustee or an Administrator.



     Section 4.9. Delegation of Power.



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



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



     Section 4.10. Conversion, Consolidation or Succession to Business. Any Person into
which the Institutional Trustee or the Delaware Trustee may be merged or converted or with which it
may be consolidated, or any Person resulting from any merger, conversion or consolidation to which
the Institutional Trustee or the Delaware Trustee 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 shall be the successor of the Institutional Trustee or the Delaware Trustee hereunder,
provided such Person shall



23









 







be otherwise qualified and eligible under this Article and, provided, further, that
such Person shall file an amendment to the Certificate of Trust with the Secretary of State of the
State of Delaware as contemplated in Section 4.5(i).



ARTICLE V




DISTRIBUTIONS




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



ARTICLE VI




ISSUANCE OF SECURITIES




     Section 6.1. General Provisions Regarding Securities.



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



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



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



24









 





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



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



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



     Section 6.3. Form and Dating. The Capital Securities and the Institutional Trustee’s
certificate of authentication thereon shall be substantially in the form of Exhibit A-1, and the
Common Securities shall be substantially in the form of Exhibit A-2, each of which is hereby
incorporated in and expressly made a part of this Declaration. Certificates may be typed, printed,
lithographed or engraved or may be produced in any other manner as is reasonably acceptable to the
Administrators, as conclusively evidenced by their execution thereof. The Securities may have
letters, numbers, notations or other marks of identification or designation and such legends or
endorsements required by law, stock exchange rule, agreements to which the Trust is subject if any,
or usage (provided that any such notation, legend or endorsement is in a form acceptable to the
Sponsor). The Trust at the direction of the Sponsor shall furnish any such legend not contained in
Exhibit A-1 to the Institutional Trustee in writing. Each Capital Security shall be dated on or
before the date of its authentication. The terms and provisions of the Securities set forth in
Annex I and the forms of Securities set forth in Exhibits A-1 and A-2 are part of the 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 $100,000.00 and any multiple of
$1,000.00 in excess thereof.



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



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



     If:



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



25









 





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



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



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



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



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



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



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



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



26









 






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




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




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




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




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




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



     The Holders of at least a Majority in liquidation amount of the Capital Securities may, on
behalf of the Holders of all the Capital Securities, waive any past default under the Indenture or
any Indenture Event of Default, except a default or Indenture Event of Default in the payment of
principal or interest on the Debentures (unless such default or Indenture 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 under the
Indenture or an Indenture 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.



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



27









 





ARTICLE VII




DISSOLUTION AND TERMINATION OF TRUST




     Section 7.1. Dissolution and Termination of Trust.




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




     (i) unless earlier dissolved, on December 15, 2040, 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) upon the filing of a certificate of dissolution or its
equivalent with respect to the Sponsor (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) or upon the revocation of the
charter of the Sponsor and the expiration of 90 days after the date of
revocation without a reinstatement thereof;




     (iv) upon the distribution of the Debentures to the Holders of the Securities, 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 of the Statutory Trust Act, and subject to the terms set forth in Annex I, the
Institutional Trustee shall terminate the Trust by filing a certificate of cancellation with the
Secretary of State of the State of 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) Subject to Section 8.1(c), where Capital Securities are presented to the Registrar or a
co-registrar with a request to register a transfer or to exchange them for an equal number of
Capital Securities represented by different certificates, the Registrar shall register the transfer
or make the exchange if its requirements for such transactions are met. To permit registrations of
transfer and exchanges, the Trust shall issue and the Institutional Trustee shall authenticate
Capital Securities at the Registrar’s request.



28









 





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



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



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



     (e) The Trust shall not be required (i) to issue, register the transfer of, or exchange any
Securities during a period beginning at the opening of business fifteen 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) 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 satisfactory to the Institutional Trustee, as may be reasonably required by the
Trust, that neither the legend nor the restrictions on transfer set forth therein are required to
ensure that transfers thereof comply with the provisions of the Securities Act. Upon provision of
such satisfactory evidence, the Institutional Trustee, at the written direction of the Trust, shall
authenticate and deliver Capital Securities that do not bear the legend.



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




          THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW.



29









 






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




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



30









 






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




          THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A LIQUIDATION
AMOUNT OF NOT LESS THAN $100,000.00 (100 SECURITIES) AND MULTIPLES OF $1,000.00 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS
THAN $100,000.00 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER.




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



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



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



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



     Section 8.3. Deemed Security Holders. The Trust, the Administrators, the 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, INSTITUTIONAL TRUSTEE OR OTHERS




     Section 9.1. Liability.



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



31









 






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




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



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



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



32









 






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



     Section 9.4. Indemnification.



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



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



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



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



     (e) To the fullest extent permitted by law, expenses (including reasonable attorneys’ fees and
expenses) incurred by an Indemnified Person in defending a civil, criminal, administrative or



33









 







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



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



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



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



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



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



34









 





     Section 9.5. Outside Businesses. Any Covered Person, the Sponsor, the Delaware Trustee
and the Institutional Trustee may engage in or possess an interest in other business ventures of
any nature or description, independently or with others, similar or dissimilar to the business of
the Trust, and the Trust and the Holders of Securities shall have no rights by virtue of this
Declaration in and to such independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the Trust, shall not be
deemed wrongful or improper. None of any Covered Person, the Sponsor, 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.



     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, bad faith or willful misconduct.



     For purposes of clarification, this Section 9.6 does not contemplate the payment by the
Sponsor of acceptance or annual administration fees owing to the Trustees under this Declaration or
the fees and expenses of the Trustees’ counsel in connection with the closing of the transactions
contemplated by this Declaration.



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



     Section 10.2. Certain Accounting Matters.



     (a) At all times during the existence of the Trust, the Administrators shall keep, or cause to
be kept at the principal office of the Trust in the United States, as defined for purposes of
Treasury Regulations section 301.7701-7, full books of account, records and supporting documents,
which shall reflect in reasonable detail each transaction of the Trust. The books of account shall
be maintained, at the



35









 







Sponsor’s expense, in accordance with generally accepted accounting principles, consistently
applied. The books of account and the records of the Trust shall be examined by and reported upon
(either separately or as part of the Sponsor’s regularly prepared consolidated financial report) as
of the end of each Fiscal Year of the Trust by a firm of independent certified public accountants
selected by the Administrators.



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



     (c) The Administrators, at the Sponsor’s expense, shall cause to be duly prepared at the
principal office of the Sponsor in the United States, as ‘United States’ is defined in Section
7701(a)(9) of the Code (or at the principal office of the Trust if the Sponsor has no such
principal office in the United States), and filed an annual United States federal income tax return
on a Form 1041 or such other form required by United States federal income tax law, and any other
annual income tax returns required to be filed by the Administrators on behalf of the Trust with
any state or local taxing authority.



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



     Section 10.4. Withholding. The Institutional Trustee or any Paying Agent and the
Administrators shall comply with all withholding requirements under United States federal, state
and local law. The Institutional Trustee or any Paying Agent shall request, and each Holder shall
provide to the Institutional Trustee or any Paying Agent, such forms or certificates as are
necessary to establish an exemption from withholding with respect to the Holder, and any
representations and forms as shall reasonably be requested by the Institutional Trustee or any
Paying Agent to assist it in determining the extent of, and in fulfilling, its withholding
obligations. The Administrators shall file required forms with applicable jurisdictions and, unless
an exemption from withholding is properly established by a Holder, shall remit amounts withheld
with respect to the Holder to applicable jurisdictions. To the extent that the Institutional
Trustee or any Paying Agent is required to withhold and pay over any amounts to any authority with
respect to distributions or allocations to any Holder, the amount withheld shall be deemed to be a
Distribution in the amount of the withholding to the Holder. In the event of any claimed
overwithholding, Holders shall be limited to an action against the applicable jurisdiction. If the
amount required to be withheld was not withheld from actual Distributions made, the Institutional
Trustee or any Paying Agent may reduce subsequent Distributions by the amount of such withholding.



ARTICLE XI




AMENDMENTS AND MEETINGS




     Section 11.1. Amendments.



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



36









 







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



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




          (i) the Institutional Trustee shall have first received




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




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




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




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




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



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



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



     (e) Sections 9.1(b) and 9.1(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 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 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;



37









 






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




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



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



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



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



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




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



38









 







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



ARTICLE XII




REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND THE DELAWARE TRUSTEE




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



     (a) the Institutional Trustee is a Delaware banking corporation with trust powers, duly
organized and validly existing 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 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 of the 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) if it is not a natural person, the Delaware Trustee is duly organized, validly existing
and in good standing under the laws of the State of Delaware;



39









 





     (b) if it is not a natural person, the execution, delivery and performance by the Delaware
Trustee of this Declaration has been duly authorized by all necessary corporate action on the part
of the Delaware Trustee. This Declaration has been duly executed and delivered by the Delaware
Trustee, and under Delaware law (excluding any securities laws) 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 of equity and the discretion of the
court (regardless of whether considered in a proceeding in equity or at law);



     (c) if it is not a natural person, the execution, delivery and performance of this Declaration
by the Delaware Trustee does not conflict with or constitute a breach of the charter or by-laws of
the Delaware Trustee;



     (d) it has trust power and authority to execute and deliver, and to carry out and perform its
obligations under the terms of, this Declaration;



     (e) no consent, approval or authorization of, or registration with or notice to, any state or
federal banking authority governing the trust powers of the Delaware Trustee is required for the
execution, delivery or performance by the Delaware Trustee of this Declaration; and



     (f) the Delaware Trustee is a natural person who is a resident of the State of Delaware or, if
not a natural person, it is 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 Statutory 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):


Peoples Community Statutory Trust I

c/o Peoples Community Bancshares, Inc.

25 South Links Avenue

Sarasota, Florida 34236

Attention: Dorothy S. Barth

Telecopy: 941-955-6578




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


Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, Delaware 19890-1600

Attention: Corporate Trust Administration

Telecopy: 302-636-4140




40









 








     (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):


Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, Delaware 19890-1600

Attention: Corporate Trust Administration

Telecopy: 302-636-4140




     (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):


Peoples Community Bancshares, Inc.

25 South Links Avenue

Sarasota, Florida 34236

Attention: Dorothy S. Barth

Telecopy: 941-955-6578




     (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)
affirmative requirements to post bonds for trustees, officers, agents or employees of a trust, (c)
the necessity for obtaining court or other governmental approval concerning the acquisition,
holding or disposition of real or personal property, (d) fees or other sums payable to trustees,
officers, agents or employees of a trust, (e) the allocation of receipts and expenditures to income
or principal, or (f) restrictions or limitations on the permissible nature, amount or concentration
of trust investments or requirements relating to the titling, storage or other manner of holding or
investing trust assets.



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



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



41









 





     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.



Signatures appear on the following page




42









 









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



	 	 	 	 	 
	 	WILMINGTON TRUST COMPANY,
 as Delaware Trustee

 	 
	 	By:  	/s/ Christopher J. Monigle
 	 
	 	 	Name:  	Christopher J. Monigle 	 
	 	 	Title:  	Assistant Vice President 	 
	 
	 	WILMINGTON TRUST COMPANY,

as Institutional Trustee

 	 
	 	By:  	/s/ Christopher J. Monigle
 	 
	 	 	Name:  	Christopher J. Monigle 	 
	 	 	Title:  	Assistant Vice President 	 
	 
	 	PEOPLES COMMUNITY BANCSHARES, INC.,
 as Sponsor

 	 
	 	By:  	/s/ Dorothy S. Barth
 	 
	 	 	Name:  	Dorothy S. Barth  	 
	 	 	Title:  	CFO 	 
	 
	 	ADMINISTRATORS OF PEOPLES COMMUNITY
 STATUTORY TRUST I

 	 
	 	By:  	/s/
Neil D. McCurry, Jr.
 	 
	 	 	Administrator 	 
	 	 	 	 
	 
	 	 	 
	 	By:  	/s/ Dorothy S. Barth
 	 
	 	 	Administrator 	 
	 	 	 	 
	 




43











 





ANNEX I




TERMS OF SECURITIES




          Pursuant to Section 6.1 of the Amended and Restated Declaration of Trust, dated as of December
15, 2005 (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) 4,000 Fixed/Floating Rate Capital Securities of Peoples Community Statutory Trust I (the
“Trust”), with an aggregate stated liquidation amount with respect to the assets of the Trust of
four million dollars ($4,000,000.00) and a stated liquidation amount with respect to the assets of
the Trust of $1,000.00 per Capital Security, are hereby designated for the purposes of
identification only as the “Capital Securities”. The Capital Security Certificates evidencing the
Capital Securities shall be substantially in the form of Exhibit A-1 to the Declaration, with such
changes and additions thereto or deletions therefrom as may be required by ordinary usage, custom
or practice.




          (b) 124 Fixed/Floating Rate Common Securities of the Trust (the “Common Securities”) will be
evidenced by Common Security Certificates substantially in the form of Exhibit A-2 to the
Declaration, with such changes and additions thereto or deletions therefrom as may be required by
ordinary usage, custom or practice.




     2. Distributions.



          (a) Distributions will be payable on each Security for the Distribution Period beginning on
(and including) the date of original issuance and ending on (but excluding) the Distribution
Payment Date in December 2010 at a rate per annum of 6.41% and shall bear interest for each
successive Distribution Period beginning on (and including) the Distribution Payment Date in
December 2010, and each succeeding Distribution Payment Date, and ending on (but excluding) the
next succeeding Distribution Payment Date at a rate per annum equal to the 3-Month LIBOR,
determined as described below, plus 1.45% (the “Coupon Rate”), applied to the stated liquidation
amount thereof, such rate being the rate of interest payable on the Debentures to be held by the
Institutional Trustee. Distributions in arrears will bear interest thereon compounded quarterly at
the applicable Distribution Rate (to the extent permitted by law). Distributions, as used herein,
include cash distributions and any such compounded distributions unless otherwise noted. 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 the Distribution payable (i) for any Distribution Period commencing on or
after the date of original issuance but before the Distribution Payment Date in December 2010 will
be computed on the basis of a 360-day year of twelve 30-day months, and (ii) for the Distribution
Period commencing on the Distribution Payment Date in December 2010 and each succeeding
Distribution Period will be calculated by applying the Distribution Rate to the stated liquidation
amount outstanding at the commencement of the Distribution Period on the basis of the actual number
of days in the Distribution Period concerned divided by 360. All percentages resulting from any
calculations on the Capital Securities will be rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point, with five one-millionths of a percentage point rounded
upward (e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655), and all dollar
amounts used in or resulting from such calculation will be rounded to the nearest cent (with one-half cent being rounded
upward)).




I-1 









 








          (b) Distributions on the Securities will be cumulative, will accrue from the date of original
issuance, and will be payable, subject to extension of distribution payment periods as described
herein, quarterly in arrears on March 15, June 15, September 15 and December 15 of each year, or if
such day is not a Business Day, then the next succeeding Business Day (each a “Distribution Payment
Date”) (it being understood that interest accrues for any such non-Business Day during the
applicable Distribution Period, beginning on or after December 15, 2010), commencing on the
Distribution Payment Date in March 2006 when, as and if available for payment. The Debenture Issuer
has the right under the Indenture to defer payments of interest on the Debentures, so long as no
Acceleration Event of Default has occurred and is continuing, by deferring the payment of interest
on the Debentures for up to 20 consecutive quarterly periods (each an “Extension Period”) at any
time and from time to time, subject to the conditions described below, during which Extension
Period no interest shall be due and payable. During any Extension Period, interest will continue to
accrue on the Debentures, and interest on such accrued interest will accrue at an annual rate equal
to the Distribution Rate in effect for each such Extension Period, compounded quarterly from the
date such interest would have been payable were it not for the Extension Period, to the extent
permitted by law (such interest referred to herein as “Additional Interest”). No Extension Period
may end on a date other than a Distribution Payment Date. At the end of any such Extension Period,
the Debenture Issuer shall pay all interest then accrued and unpaid on the Debentures (together
with Additional Interest thereon); provided, however, that no Extension Period may extend beyond
the Maturity Date and provided further, however, that during any such Extension Period, the
Debenture Issuer and its Affiliates shall not (i) declare or pay any dividends or distributions on,
or redeem, purchase, acquire, or make a liquidation payment with respect to, any of the Debenture
Issuer’s or its Affiliates’ capital stock (other than payments of dividends or distributions to the
Debenture Issuer) or make any guarantee payments with respect to the foregoing, or (ii) make any
payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Debenture Issuer or any Affiliate that rank pari passu in all respects with or
junior in interest to the Debentures (other than, with respect to clauses (i) and (ii) above, (a)
repurchases, redemptions or other acquisitions of shares of capital stock of the Debenture Issuer
in connection with any employment contract, benefit plan or other similar arrangement with or for
the benefit of one or more employees, officers, directors or consultants, in connection with a
dividend reinvestment or stockholder stock purchase plan or in connection with the issuance of
capital stock of the Debenture Issuer (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior to the applicable
Extension Period, (b) as a result of any exchange or conversion of any class or series of the
Debenture Issuer’s capital stock (or any capital stock of a subsidiary of the Debenture Issuer) for
any class or series of the Debenture Issuer’s capital stock or of any class or series of the
Debenture Issuer’s indebtedness for any class or series of the Debenture Issuer’s capital stock,
(c) the purchase of fractional interests in shares of the Debenture Issuer’s capital stock pursuant
to the conversion or exchange provisions of such capital stock or the security being converted or
exchanged, (d) any declaration of a dividend in connection with any stockholders’ rights plan, or
the issuance of rights, stock or other property under any stockholders’ rights plan, or the
redemption or repurchase of rights pursuant thereto, (e) any dividend in the form of stock,
warrants, options or other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the dividend is being
paid or ranks pari passu with or junior to such stock and any cash payments in lieu of fractional
shares issued in connection therewith, or (f) payments under the Capital Securities Guarantee).
Prior to the termination of any Extension Period, the Debenture Issuer may further extend such
period, provided that such period together with all such previous and further consecutive
extensions thereof shall not exceed 20 consecutive quarterly periods, or extend beyond the Maturity
Date. Upon the termination of any Extension Period and upon the payment of all accrued and unpaid
interest and Additional Interest, the Debenture Issuer may commence a new Extension Period,
subject to the foregoing requirements. No interest or Additional Interest shall be due and payable
during an Extension Period, except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear Additional Interest.
During any Extension Period, Distributions



I-2 









 






on the Securities shall be deferred for a period equal to the Extension Period. If Distributions
are deferred, the Distributions due shall be paid on the date that the related Extension Period
terminates to Holders of the Securities as they appear on the books and records of the Trust on the
record date immediately preceding such date. Distributions on the Securities must be paid on the
dates payable (after giving effect to any Extension Period) to the extent that the Trust has funds
available for the payment of such distributions in the Property Account of the Trust. The Trust’s
funds available for Distribution to the Holders of the Securities will be limited to payments
received from the Debenture Issuer. The payment of Distributions out of moneys held by the Trust
is guaranteed by the Guarantor pursuant to the Guarantee.




          (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
fifteen days before the relevant Distribution Payment Date. Distributions payable on any Securities
that are not punctually paid on any Distribution Payment Date, as a result of the Debenture Issuer
having failed to make a payment under the Debentures, as the case may be, when due (taking into
account any Extension Period), will cease to be payable to the Person in whose name such Securities
are registered on the relevant record date, and such defaulted Distribution will instead be payable
to the Person in whose name such Securities are registered on the special record date or other
specified date determined in accordance with the Indenture.




          (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
$1,000.00 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 Distribution Rate of, and bearing accrued
and unpaid interest in an amount equal to the accrued and unpaid Distributions on, and having the
same record date as, such Securities, after paying or making reasonable provision to pay all claims
and obligations of the Trust in accordance with the Statutory Trust Act, shall be distributed on a
Pro Rata basis to the Holders of the Securities in exchange for such Securities.



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



I-3 









 





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



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



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



     4. Redemption and Distribution.



          (a) The Debentures will mature on December 15, 2035. The Debentures may be redeemed by the
Debenture Issuer, in whole or in part, at any Distribution Payment Date on or after the
Distribution Payment Date in December 2010, at the Redemption Price. In addition, the Debentures
may be redeemed by the Debenture Issuer at the Special Redemption Price, in whole but not in part,
at any Distribution Payment Date, upon the occurrence and continuation of a Special Event within
120 days following the occurrence of such Special Event at the Special Redemption Price, upon not
less than 30 nor more than 60 days’ notice to holders of such Debentures so long as such Special
Event is continuing. In each case, the right of the Debenture Issuer to redeem the Debentures is
subject to the Debenture Issuer having received prior approval from the Federal Reserve (if the Debenture Issuer is a bank holding company) or
prior approval from the OTS (if the Debenture Issuer is a savings and loan holding company), in
each case if then required under applicable capital guidelines or policies of the applicable
federal agency. The Sponsor shall appoint a Quotation Agent, which shall be a designee of the
Institutional Trustee, for the purpose of performing the services contemplated in or by reference
in, the definition of Special Redemption Price. Any error in the calculation of the Special
Redemption Price by the Quotation Agent or the Debenture Trustee may be corrected at any time by
notice delivered to the Sponsor and the holders of the Capital Securities. Subject to the
corrective rights set forth above, all



I-4 









 






certificates, communications, opinions, determinations, calculations, quotations and decisions
given, expressed, made or obtained for the purposes of the provisions relating to the payment and
calculation of the Special Redemption Price on the Debentures or the Capital Securities by the
Debenture Trustee, the Quotation Agent or the Institutional Trustee, as the case may be, shall (in
the absence of willful default, bad faith or manifest error) be final, conclusive and binding on
the holders of the Debentures and the Capital Securities, the Trust and the Sponsor, and no
liability shall attach (except as provided above) to the Debenture Trustee, the Quotation Agent or
the Institutional Trustee in connection with the exercise or non-exercise by any of them of their
respective powers, duties and discretion.




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




     (1) the rate (expressed as a percentage per annum) for U.S. dollar deposits having a
three-month maturity that appears on Telerate Page 3750 as of 11:00 a.m. (London time) on
the related Determination Date (as defined below). “Telerate Page 3750” means the display
designated as “Page 3750” on the Moneyline Telerate Service or such other page as may
replace Page 3750 on that service or such other service or services as may be nominated by
the British Bankers’ Association as the information vendor for the purpose of displaying
London interbank offered rates for U.S. dollar deposits;




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




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




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



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



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



     “Capital Treatment Event” means the receipt by the Debenture Issuer and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result of the occurrence of
any amendment to, or change (including any announced prospective change) in, the laws, rules or
regulations of the United States or any political subdivision thereof or therein, or as the result
of any official or administrative pronouncement or action or decision interpreting or applying such
laws, rules or regulations, which amendment or change is effective or which pronouncement, action
or decision is



I-5 









 




announced on or after the date of original issuance of the Debentures, there is more than an
insubstantial risk that the Sponsor will not, within 90 days of the date of such opinion, be
entitled to treat an amount equal to the aggregate liquidation amount of the Capital Securities as
“Tier 1 Capital” (or its then equivalent) for purposes of the capital adequacy guidelines of the
Federal Reserve, as then in effect and applicable to the Sponsor (or if the Sponsor is not a bank
holding company or otherwise is not subject to the Federal Reserve’s risk-based capital adequacy
guidelines, such guidelines applied to the Sponsor as if the Sponsor were subject to such
guidelines); provided, however, that the inability of the Sponsor to treat all or any portion of
the liquidation amount of the Capital Securities as Tier l Capital shall not constitute the basis
for a Capital Treatment Event, if such inability results from the Sponsor having cumulative
preferred stock, minority interests in consolidated subsidiaries, or any other class of security or
interest which the Federal Reserve or OTS, as applicable, may now or hereafter accord Tier 1
Capital treatment in excess of the amount which may now or hereafter qualify for treatment as Tier
1 Capital under applicable capital adequacy guidelines; provided further, however, that the
distribution of Debentures in connection with the Liquidation of the Trust shall not in and of
itself constitute a Capital Treatment Event unless such Liquidation shall have occurred in
connection with a Tax Event or an Investment Company Event.




     “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
Fixed Rate Period 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 Fixed Rate Period Remaining Life. If no United States Treasury security has a
maturity which is within a period from 3 months before to 3 months after the Distribution Payment
Date in December 2010, the two most closely corresponding United States Treasury securities as
selected by the Quotation Agent shall be used as the Comparable Treasury Issue, and the Treasury
Rate shall be interpolated and extrapolated on a straight-line basis, rounding to the nearest month
using such securities.



     “Comparable Treasury Price” means (a) the average of 5 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 5 such Reference Treasury
Dealer Quotations, the average of all such Quotations.



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



     “Fixed Rate Period Remaining Life” means, with respect to any Debenture, the period from the
Special Redemption Date for such Debenture to the Distribution Payment Date in December 2010.



     “Investment Company Event” means the receipt by the Debenture Issuer and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result of the occurrence of
a change in law or regulation or written change (including any announced prospective change) in
interpretation or application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, there is more than an insubstantial risk that the Trust is or,
within 90 days of the date of such opinion, will be considered an Investment Company that is
required to be registered under the Investment Company Act which change or prospective change
becomes effective or would become effective, as the case may be, on or after the date of the
issuance of the Debentures.



     “Maturity Date” means December 15, 2035.



     “Primary Treasury Dealer” shall mean either a primary United States Government securities
dealer or an entity of nationally recognized standing in matters pertaining to the quotation of
treasury securities that is reasonably acceptable to the Sponsor and the Institutional Trustee.



I-6 









 





     “Quotation Agent” means a designee of the Institutional Trustee who shall be a Primary
Treasury Dealer.



     “Redemption Date” shall mean the date fixed for the redemption of Capital Securities, which
shall be any Distribution Payment Date on or after the Distribution Payment Date in December 2010.



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



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



     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Special 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.



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



     “Special Redemption Date” means a date on which a Special Event redemption occurs, which shall
be a Distribution Payment Date.



     “Special Redemption Price” means (a) if the Special Redemption Date occurs before the
Distribution Payment Date in December 2010, the greater of (i) 107.5% of the principal amount of
the Debentures, plus accrued and unpaid Interest on the Debentures to the Special Redemption Date,
or (ii) as determined by the Quotation Agent, (A) the sum of the present values of the scheduled
payments of principal and Interest on the Debentures during the Fixed Rate Period Remaining Life of
the Debentures (assuming the Debentures matured on December 15, 2010) discounted to the Special
Redemption Date on a quarterly basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate, plus (B) accrued and unpaid Interest on the Debentures to such Special
Redemption Date, or (b) if the Special Redemption Date occurs on or after the Distribution Payment
Date in December 2010, 100% of the principal amount of the Debentures being redeemed, plus accrued
and unpaid Interest on such Debentures to the Special Redemption Date.



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



I-7 









 




date of such opinion, subject to more than a de minimis amount of other taxes, duties or other
governmental charges.




     “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 Fixed Rate Period Remaining Life (if no maturity is within three
months before or after the Fixed Rate Period Remaining Life, yields for the two published
maturities most closely corresponding to the Fixed Rate Period 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 by the Quotation Agent 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 Debentures
(other than following the distribution of the Debentures to the Holders of the Securities), the
proceeds from such repayment or payment shall concurrently be applied to redeem Pro Rata at the
applicable Redemption Price or Special Redemption Price, as applicable, Securities having an
aggregate liquidation amount equal to the aggregate principal amount of the Debentures so repaid or
redeemed; provided, however, that holders of such Securities shall be given not less than 30 nor
more than 60 days’ notice of such redemption (other than at the scheduled maturity of the
Debentures).




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




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




          (e) Redemption or Distribution Procedures.





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



I-8 









 






     (ii) If the Securities are to be redeemed and the Trust gives a Redemption/
Distribution Notice, which notice may only be issued if the Debentures are redeemed as set
out in this paragraph 4 (which notice will be irrevocable), then, provided that the
Institutional Trustee has a sufficient amount of cash in connection with the related
redemption or maturity of the Debentures, the Institutional Trustee will pay the relevant
Redemption Price or Special Redemption Price, as applicable, to the Holders of such
Securities by check mailed to the address of each such Holder appearing on the books and
records of the Trust on the Redemption Date. If a Redemption/Distribution Notice shall have
been given and funds deposited as required then immediately prior to the close of business
on the date of such deposit Distributions will cease to accrue on the Securities so called
for redemption and all rights of Holders of such Securities so called for redemption will
cease, except the right of the Holders of such Securities to receive the applicable
Redemption Price or Special Redemption Price specified in paragraph 4(a), but without
interest on such Redemption Price or Special Redemption Price. If payment of the
Redemption Price or Special 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 Distribution Rate from the original Redemption Date to the actual date of
payment, in which case the actual payment date will be considered the date fixed for
redemption for purposes of calculating the Redemption Price or Special Redemption Price. In
the event of any redemption of the Capital Securities issued by the Trust in part, the
Trust shall not be required to (i) issue, register the transfer of or exchange any Security
during a period beginning at the opening of business fifteen days before any selection for
redemption of the Capital Securities and ending at the close of business on the earliest
date on which the relevant notice of redemption is deemed to have been given to all Holders
of the Capital Securities to be so redeemed or (ii) register the transfer of or exchange
any Capital Securities so selected for redemption, in whole or in part, except for the
unredeemed portion of any Capital Securities being redeemed in part.




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




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



     5. Voting Rights — Capital Securities.



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




               (b) Subject to the requirements of obtaining a tax opinion by the Institutional Trustee in
certain circumstances set forth in the last sentence of this paragraph, the Holders of a Majority
in liquidation amount of the Capital Securities, voting separately as a class, have the right to
direct the time, method, and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the Institutional
Trustee under the Declaration, including the right to direct the Institutional Trustee, as
holder of the Debentures, to (i) exercise the remedies available under the Indenture as the holder
of the Debentures, (ii) waive any past default that is waivable under the



I-9 









 






Indenture, (iii) exercise any right to rescind or annul a declaration that the principal of all the
Debentures shall be due and payable or (iv) consent on behalf of all the Holders of the Capital
Securities to any amendment, modification or termination of the Indenture or the Debentures where
such consent shall be required; provided, however, that, where a consent or action under the
Indenture would require the consent or act of the holders of greater than a simple majority in
aggregate principal amount of Debentures (a “Super Majority”) affected thereby, the Institutional
Trustee may only give such consent or take such action at the written direction of the Holders of
at least the proportion in liquidation amount of the Capital Securities outstanding which the
relevant Super Majority represents of the aggregate principal amount of the Debentures outstanding.
If the Institutional Trustee fails to enforce its rights under the Debentures after the Holders of
a Majority in liquidation amount of such Capital Securities have so directed the Institutional
Trustee, to the fullest extent permitted by law, a Holder of the Capital Securities may institute a
legal proceeding directly against the Debenture Issuer to enforce the Institutional Trustee’s
rights under the Debentures without first instituting any legal proceeding against the
Institutional Trustee or any other person or entity. Notwithstanding the foregoing, if an Event of
Default has occurred and is 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 or the Special Redemption
Date, as applicable), then a Holder of record of the Capital Securities may directly institute a
proceeding for enforcement of payment, on or after the respective due dates specified in the
Debentures, to such Holder directly of the principal of or interest on the Debentures having an
aggregate principal amount equal to the aggregate liquidation amount of the Capital Securities of
such Holder. The Institutional Trustee shall notify all Holders of the Capital Securities of any
default actually known to the Institutional Trustee with respect to the Debentures unless (x) such
default has been cured prior to the giving of such notice or (y) the Institutional Trustee
determines in good faith that the withholding of such notice is in the interest of the Holders of
such Capital Securities, except where the default relates to the payment of principal of or
interest on any of the Debentures. Such notice shall state that such Indenture Event of Default
also constitutes an Event of Default hereunder. Except with respect to directing the time, method
and place of conducting a proceeding for a remedy, the Institutional Trustee shall not take any of
the actions described in clauses (i), (ii) or (iii) above unless the Institutional Trustee has
obtained an opinion of tax counsel to the effect that, as a result of such action, the Trust will
not be classified as other than a grantor trust for United States federal income tax purposes.




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



     A waiver of an Indenture Event of Default will constitute a waiver of the corresponding Event
of Default hereunder. Any required approval or direction of Holders of the Capital Securities may
be given at a separate meeting of Holders of the Capital Securities convened for such purpose, at a
meeting of all of the Holders of the Securities in the Trust or pursuant to written consent. The
Institutional Trustee will cause a notice of any meeting at which Holders of the Capital Securities
are entitled to vote, or of any matter upon which action by written consent of such Holders is to
be taken, to be mailed to each Holder of record of the Capital Securities. Each such notice will
include a statement setting forth the following



I-10 









 




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




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




          (c) Subject to Section 6.7 of the Declaration and only after each Event of Default (if any)
with respect to the Capital Securities has been cured, waived, or otherwise eliminated and subject
to the requirements of the second to last sentence of this paragraph, the Holders of a Majority in
liquidation amount of the Common Securities, voting separately as a class, may direct the time,
method, and place of conducting any proceeding for any remedy available to the Institutional
Trustee, or exercising any trust or power conferred upon the Institutional Trustee under the
Declaration, including (i) directing the time, method, place of conducting any proceeding for any
remedy available to the Debenture Trustee, or exercising any trust or power conferred on the
Debenture Trustee with respect to the Debentures, (ii) waiving any past default and its
consequences that is waivable under the Indenture, or (iii) exercising any right to rescind or
annul a declaration that the principal of all the Debentures shall be due and payable; provided,
however, that, where a consent or action under the Indenture would require a Super Majority, the
Institutional Trustee may only give such consent or take such action at the written direction of
the Holders of at least the proportion in liquidation amount of the Common Securities which the
relevant Super Majority represents of the aggregate principal amount of the Debentures outstanding.
Notwithstanding this paragraph 6(c), the Institutional Trustee shall not revoke any action
previously authorized or approved by a vote or consent of the Holders of the Capital Securities.
Other than with respect to directing the time, method and place of conducting any proceeding for
any remedy available to the Institutional Trustee or the Debenture Trustee as set forth above, the
Institutional Trustee shall not take any action described in (i), (ii) or (iii) above, unless the
Institutional Trustee has obtained an opinion of tax counsel to the effect that for the purposes of
United States federal income tax the Trust will not be classified as other than a grantor trust on
account of such action. If the Institutional Trustee fails to enforce its rights, to the fullest
extent permitted by law, under the Declaration, 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.



I-11 









 







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




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




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




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



I-12 









 







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



     9. Ranking. The Capital Securities rank pari passu with and payment thereon shall be made Pro
Rata with the Common Securities except that, where an Event of Default has occurred and is
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 (or Special Redemption Price) of, any Common Security, and no other payment on account of
redemption, liquidation or other acquisition of Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all outstanding Capital Securities for
all distribution periods terminating on or prior thereto, or in the case of payment of the
Redemption Price (or Special Redemption Price) the full amount of such Redemption Price (or Special
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 (or
Special Redemption Price) of, the Capital Securities then due and payable.



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



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



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




I-13 












 





EXHIBIT A-1




FORM OF CAPITAL SECURITY CERTIFICATE




[FORM OF FACE OF SECURITY]




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



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



A-1-1









 




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




     THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A LIQUIDATION AMOUNT
OF NOT LESS THAN $100,000.00 (100 SECURITIES) AND MULTIPLES OF $1,000.00 IN EXCESS THEREOF. ANY
ATTEMPTED TRANSFER OF SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS THAN $100,000.00
SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER.



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



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



	 	 	 	 	 
	        Certificate Number P-1
	 	4,000 Capital Securities
	        [CUSIP NO. [                      ] **To be inserted at the request of a subsequent transferee]
	 	 	 	 






December 15, 2005




Certificate Evidencing Fixed/Floating Rate Capital Securities




of




Peoples Community Statutory Trust I




(liquidation amount $1,000.00 per Capital Security)




     Peoples Community Statutory Trust I, a statutory trust created under the laws of the State of
Delaware (the “Trust”), hereby certifies that First Tennessee Bank National Association is the
registered owner of capital securities of the Trust representing undivided beneficial interests in
the assets of the Trust, (liquidation amount $1,000.00 per capital security) (the “Capital
Securities”). Subject to the Declaration (as defined below), the Capital Securities are
transferable on the books and records of the Trust in person or by a duly authorized attorney, upon
surrender of this Certificate duly endorsed and in proper form for transfer. The Capital Securities
represented hereby are issued pursuant to, and the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities shall in all respects be
subject to, the provisions of the Amended and Restated Declaration of Trust of the Trust dated as
of December 15, 2005, among Neil D. McCurry, Jr. and Dorothy S. Barth, as Administrators,
Wilmington Trust Company, as Delaware Trustee, Wilmington Trust Company, as Institutional Trustee,
Peoples 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 such amended and restated declaration as the same may
be amended from time to time (the “Declaration”). Capitalized terms used herein but not defined
shall have the meaning given them in the Declaration. The Holder is entitled to the benefits of the
Guarantee to the extent provided therein. The Sponsor will provide a copy of the Declaration, the
Guarantee, and the Indenture to the Holder without charge upon written request to the Sponsor at
its principal place of business.



A-1-2









 





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



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



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



Signatures appear on following page




A-1-3









 










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



	 	 	 	 	 
	 	PEOPLES COMMUNITY STATUTORY TRUST I

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	Administrator 	 
	 



CERTIFICATE OF AUTHENTICATION 





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



	 	 	 	 	 
	 	WILMINGTON TRUST COMPANY, 
as the
Institutional Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Officer 	 
	 	 	 	 



A-1-4









 






	 	 	 	 	 



[FORM OF REVERSE OF CAPITAL SECURITY]





     Distributions payable on each Capital Security will be payable at an annual rate equal to
6.41% beginning on (and including) the date of original issuance and ending on (but excluding) the
Distribution Payment Date in December 2010 and at an annual rate for each successive period
beginning on (and including) the Distribution Payment Date in December 2010, and each succeeding
Distribution Payment Date, and ending on (but excluding) the next succeeding
Distribution Payment Date (each a “Distribution Period”), equal to 3-Month LIBOR, determined
as described below, plus 1.45% (the “Coupon Rate”), applied to the stated liquidation amount of
$1,000.00 per Capital Security, such rate being the rate of interest payable on the Debentures to
be held by the Institutional Trustee. Distributions in arrears will bear interest thereon
compounded quarterly at the Distribution Rate (to the extent permitted by applicable law). The
term “Distributions” as used herein includes cash distributions and any such compounded
distributions unless otherwise noted. A Distribution is payable only to the extent that payments
are made in respect of the Debentures held by the Institutional Trustee and to the extent the
Institutional Trustee has funds available therefor. As used herein, “Determination Date” means the
date that is two London Banking Days (i.e., a business day in which dealings in deposits in U.S.
dollars are transacted in the London interbank market) preceding the commencement of the relevant
Distribution Period. The amount of the Distribution payable (i) for any Distribution Period
commencing on or after the date of original issuance but before the Distribution Payment Date in
December 2010 will be computed on the basis of a 360-day year of twelve 30-day months, and (ii) for
the Distribution Period commencing on the Distribution Payment Date in December 2010 and each
succeeding Distribution Period will be calculated by applying the Distribution Rate to the stated
liquidation amount outstanding at the commencement of the Distribution Period on the basis of the
actual number of days in the Distribution Period concerned divided by 360.



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



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



A-1-5









 





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



     Except as otherwise described below, Distributions on the Capital Securities will be
cumulative, will accrue from the date of original issuance and will be payable quarterly in arrears
on March 15, June 15, September 15 and December 15 of each year or if any such day is not a
Business Day, then the next succeeding Business Day (each such day, a “Distribution Payment Date”)
(it being understood that interest accrues for any such non-Business Day during the applicable
Distribution Period, beginning on or after December 15, 2010), commencing on the Distribution
Payment Date in March 2006. The Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures, so long as no Acceleration Event of Default has occurred
and is continuing, by extending the interest payment period for up to 20 consecutive quarterly
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. During any Extension Period, interest will continue to accrue on the Debentures, and
interest on such accrued interest will accrue at an annual rate equal to the Distribution Rate in
effect for each such Extension Period, compounded quarterly from the date such interest would have
been payable were it not for the Extension Period, to the extent permitted by law (such interest
referred to herein as “Additional Interest”). No Extension Period may end on a date other than a
Distribution Payment Date. At the end of any such Extension Period, the Debenture Issuer shall pay
all interest then accrued and unpaid on the Debentures (together with Additional Interest thereon);
provided, however, that no Extension Period may extend beyond the Maturity Date. Prior to the
termination of any Extension Period, the Debenture Issuer may further extend such period, provided
that such period together with all such previous and further consecutive extensions thereof shall
not exceed 20 consecutive quarterly periods, or extend beyond the Maturity Date. Upon the
termination of any Extension Period and upon the payment of all accrued and unpaid interest and
Additional Interest, the Debenture Issuer may commence a new Extension Period, subject to the
foregoing requirements. No interest or Additional Interest shall be due and payable during an
Extension Period, except at the end thereof, but each installment of interest that would otherwise
have been due and payable during such Extension Period shall bear Additional Interest. During any
Extension Period, Distributions on the Capital Securities shall be deferred for a period equal to
the Extension Period. If Distributions are deferred, the Distributions due shall be paid on the
date that the related Extension Period terminates, to Holders of the Securities as they appear on
the books and records of the Trust on the record date immediately preceding such date.
Distributions on the Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds available for the payment of such
distributions in the Property Account of the Trust. The Trust’s funds available for Distribution
to the Holders of the Securities will be limited to payments received from the Debenture Issuer.
The payment of Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.



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



A-1-6









 





ASSIGNMENT




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



	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

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

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

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





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



	 	 	 	 	 	 	 	 	 
	 

	 	Date:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Signature:
	 

	 	 	 	 	 	 	 	 





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



     Signature Guarantee:1





 




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




A-1-7









 










EXHIBIT A-2




FORM OF COMMON SECURITY CERTIFICATE




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



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



	 	 	 
	Certificate Number C-1
	 	124 Common Securities






December 15, 2005




Certificate Evidencing Fixed/Floating Rate Common Securities




of




Peoples Community Statutory Trust I




     Peoples Community Statutory Trust I, a statutory trust created under the laws of the State of
Delaware (the “Trust”), hereby certifies that Peoples 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 Common Securities represented hereby are
issued pursuant to, and the designation, rights, privileges, restrictions, preferences and other
terms and provisions of the Common Securities shall in all respects be subject to, the provisions
of the Amended and Restated Declaration of Trust of the Trust dated as of December 15, 2005, among
Neil D. McCurry, Jr. and Dorothy S. Barth, as Administrators, Wilmington Trust Company, as Delaware
Trustee, Wilmington Trust Company, as Institutional Trustee, Peoples 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
such amended and restated declaration, as the same may be amended from time to time (the
“Declaration”). Capitalized terms used herein but not defined shall have the meaning given them in
the Declaration. The Holder is entitled to the benefits of the Guarantee to the extent provided
therein. The Sponsor will provide a copy of the Declaration, the Guarantee and the Indenture to
the Holder without charge upon written request to the Sponsor at its principal place of business.



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



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



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



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



A-2-1









 





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



	 	 	 	 	 
	 	PEOPLES COMMUNITY STATUTORY TRUST I

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	Administrator 	 



A-2-2









 






	 	 	 	 	 



[FORM OF REVERSE OF COMMON SECURITY]





     Distributions payable on each Common Security will be payable at an annual rate equal to 6.41%
beginning on (and including) the date of original issuance and ending on (but excluding) the
Distribution Payment Date in December 2010 and at an annual rate for each successive period
beginning on (and including) the Distribution Payment Date in December 2010, and each
succeeding Distribution Payment Date, and ending on (but excluding) the next succeeding
Distribution Payment Date (each a “Distribution Period”), equal to 3-Month LIBOR, determined as
described below, plus 1.45% (the “Coupon Rate”), applied to the stated liquidation amount of
$1,000.00 per Common Security, such rate being the rate of interest payable on the Debentures to be
held by the Institutional Trustee. Distributions in arrears will bear interest thereon compounded
quarterly at the Distribution Rate (to the extent permitted by applicable law). The term
“Distributions” as used herein includes cash distributions and any such compounded distributions
unless otherwise noted. A Distribution is payable only to the extent that payments are made in
respect of the Debentures held by the Institutional Trustee and to the extent the Institutional
Trustee has funds available therefor. As used herein, “Determination Date” means the date that is
two London Banking Days (i.e., a business day in which dealings in deposits in U.S. dollars are
transacted in the London interbank market) preceding the commencement of the relevant Distribution
Period. The amount of the Distribution payable (i) for any Distribution Period commencing on or
after the date of original issuance but before the Distribution Payment Date in December 2010 will
be computed on the basis of a 360-day year of twelve 30-day months, and (ii) for the Distribution
Period commencing on the Distribution Payment Date in December 2010 and each succeeding
Distribution Period will be calculated by applying the Distribution Rate to the stated liquidation
amount outstanding at the commencement of the Distribution Period on the basis of the actual number
of days in the Distribution Period concerned divided by 360.



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



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



A-2-3









 





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



     Except as otherwise described below, Distributions on the Common Securities will be
cumulative, will accrue from the date of original issuance and will be payable quarterly in arrears
on March 15, June 15, September 15 and December 15 of each year or if any such day is not a
Business Day, then the next succeeding Business Day (each such day, a “Distribution Payment Date”)
(it being understood that interest accrues for any such non-Business Day during the applicable
Distribution Period, beginning on or after December 15, 2010), commencing on the Distribution
Payment Date in March 2006. The Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures, so long as no Acceleration Event of Default has occurred
and is continuing, by extending the interest payment period for up to 20 consecutive quarterly
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. During any Extension Period, interest will continue to accrue on the Debentures, and
interest on such accrued interest will accrue at an annual rate equal to the Distribution Rate in
effect for each such Extension Period, compounded quarterly from the date such interest would have
been payable were it not for the Extension Period, to the extent permitted by law (such interest
referred to herein as “Additional Interest”). No Extension Period may end on a date other than a
Distribution Payment Date. At the end of any such Extension Period, the Debenture Issuer shall pay
all interest then accrued and unpaid on the Debentures (together with Additional Interest thereon);
provided, however, that no Extension Period may extend beyond the Maturity Date. Prior to
the termination of any Extension Period, the Debenture Issuer may further extend such period,
provided that such period together with all such previous and further consecutive extensions
thereof shall not exceed 20 consecutive quarterly periods, or extend beyond the Maturity Date. Upon
the termination of any Extension Period and upon the payment of all accrued and unpaid interest and
Additional Interest, the Debenture Issuer may commence a new Extension Period, subject to the
foregoing requirements. No interest or Additional Interest shall be due and payable during an
Extension Period, except at the end thereof, but each installment of interest that would otherwise
have been due and payable during such Extension Period shall bear Additional Interest. During any
Extension Period, Distributions on the Common Securities shall be deferred for a period equal to
the Extension Period. If Distributions are deferred, the Distributions due shall be paid on the
date that the related Extension Period terminates, to Holders of the Securities as they appear on
the books and records of the Trust on the record date immediately preceding such date.
Distributions on the Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds available for the payment of such
distributions in the Property Account of the Trust. The Trust’s funds available for Distribution to
the Holders of the Securities will be limited to payments received from the Debenture Issuer.



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



A-2-4









 





ASSIGNMENT




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



	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

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

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

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





	 	 	 	 	 	 	 
	 

	 	 	 	agent	 	 
	 

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






	 	 	 	 	 	 	 	 	 
	 

	 	Date:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Signature:
	 

	 	 	 	 	 	 	 	 





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






	 	 	 	 	 	 	 	 	 
	 	 	Signature:
	 

	 	 	 	 	 	 	 	 





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






     Signature Guarantee2





 




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




A-2-5









 










EXHIBIT B




SPECIMEN OF INITIAL DEBENTURE




(See Document No. 17)




B-1 









 






EXHIBIT C




PLACEMENT AGREEMENT




(See Document No. 1)





C-1