SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549



                                    FORM 10-Q

[X]               QUARTERLY REPORT PURSUANT TO SECTION  13  OR 15(d)  OF THE

                  SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 1997

                                       OR

[ ]               TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934

For the transition period from                    to

Commission file number 0-20632


                                FIRST BANKS, INC.
                                -----------------
             (Exact name of registrant as specified in its charter)

                 MISSOURI                               43-1175538
                 --------                               ----------
      (State or other jurisdiction of               (I.R.S. Employer
       incorporation or organization)                identification No.)

                   135 NORTH MERAMEC, CLAYTON, MISSOURI 63105
                   ------------------------------------------
               (address of principal executive offices) (Zip Code)

                                 (314) 854-4600
                                 --------------
              (Registrant's telephone number, including area code)

         Indicate  by check  mark  whether  the  registrant:  (1) has  filed all
reports required to be filed by Section 13 or 15 (d) of the Securities  Exchange
Act of 1934 during the preceding 12 months (or for such shorter  period that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                                Yes __X_ No ____



         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date.

                                                   Outstanding at
               Class                               April 30, 1997
                -----                              --------------

Common Stock, $250.00 par value                      23,660.86






<PAGE>



                                First Banks, Inc.


                                      INDEX


                                                                          Page

PART I            FINANCIAL INFORMATION


     Item 1.      Financial Statements:
                  Consolidated Balance Sheets as of March 31, 1997
                    and December 31, 1996                                  -1-
                  Consolidated Statements of Income for the three
                    months ended March 31, 1997 and 1996                   -3-
                  Consolidated Statements of Cash Flows for the three
                    months ended March 31, 1997 and 1996                   -4-
                  Notes to Consolidated Financial Statements               -5-

     Item 2.      Management's Discussion and Analysis of Financial
                    Condition and Results of Operations                    -8-



PART II.      OTHER INFORMATION

     Item 6.      Exhibits and Reports on Form 8-K                        -15-


Signatures                                                                -16-



<PAGE>




                                   PART I - FINANCIAL INFORMATION
                                    Item 1. Financial Statements

                                 FIRST BANKS, INC. AND SUBSIDIARIES
                               Consolidated Balance Sheets (unaudited)
                       (dollars expressed in thousands, except per share data)

<TABLE>
<CAPTION>



                                                                            March 31,       December 31,
                                   ASSETS                                     1997              1996
                                   ------                                     ----              ----

Cash and cash equivalents:
<S>                                                                       <C>                  <C>    
   Cash and due from banks ..........................................     $  106,996           147,804
   Interest-bearing deposits with other financial
      institutions-with maturities of three months
      or less .......................................................          3,757             6,050
   Federal funds sold ...............................................        105,800            74,100
                                                                             -------           -------
          Total cash and cash equivalents ...........................        216,553           227,954
                                                                             -------           -------

Investment securities:
   Available for sale, at fair value ................................        559,823          532,605
   Held to maturity, at amortized cost
      (estimated fair value of $19,955
      and $20,611 at March 31, 1997 and
      December 31,1996, respectively)................................         19,647            20,196
                                                                             -------           -------
          Total investment securities ...............................        579,470           552,801
                                                                             -------           -------
Loans:
   Commercial and industrial.........................................        506,096           457,186
   Real estate construction and development .........................        319,156           289,378
   Real estate mortgage:
      Residential....................................................      1,030,748         1,059,769
      Other..........................................................        611,898           600,811
   Consumer and installment .........................................        320,322           341,154
   Loans held for sale-residential mortgage .........................         25,813            27,485
                                                                           ---------         ---------
          Total loans ...............................................      2,814,033         2,775,783
   Unearned discount ................................................         (8,042)           (7,814)
   Allowance for possible loan losses ...............................        (47,523)          (46,781)
                                                                           ---------         --------- 
          Net loans .................................................      2,758,468         2,721,188
                                                                           ---------         ---------

Bank premises and equipment, net of
    accumulated depreciation ........................................         47,640            48,078
Intangibles associated with the purchase
    of subsidiaries .................................................         23,675            23,303
Purchased mortgage servicing rights, net
    of amortization .................................................          9,740            10,230
Accrued interest receivable .........................................         23,681            23,250
Other real estate owned .............................................         10,013            10,607
Deferred income taxes ...............................................         47,215            43,406
Other assets ........................................................         23,602            28,337
                                                                           ---------         ---------
          Total assets ..............................................     $3,740,057         3,689,154
                                                                           =========         =========

</TABLE>

<PAGE>



                                  FIRST BANKS, INC. AND SUBSIDIARIES
                                Consolidated Balance Sheets (unaudited)
                        (dollars expressed in thousands, except per share data)
                                              (continued)
<TABLE>
<CAPTION>


                                                                             March 31,              December 31,
                                                                               1997                     1996
                                                                               ----                     ----
                             LIABILITIES
                             -----------
Deposits:
       Demand:
<S>                                                                        <C>                         <C>    
          Non-interest bearing .......................................     $   389,218                 418,193
          Interest bearing ...........................................         331,311                 337,618
       Savings .......................................................         676,672                 671,286
       Time:
          Time deposits of $100 or more ..............................         181,888                 169,057
          Other time deposits ........................................       1,699,027               1,642,413
                                                                             ---------               ---------
               Total deposits ........................................       3,278,116               3,238,567
Federal Home Loan Bank advances.......................................          23,026                  39,277
Other borrowings......................................................          44,944                  30,705
Notes payable ........................................................          10,213                  76,330
Accrued interest payable .............................................           9,429                  10,288
Deferred income taxes ................................................          10,507                   6,194
Accrued and other liabilities ........................................          17,067                  23,521
Minority interest in subsidiaries.....................................          12,679                  12,883
Guaranteed preferred beneficial interest in
First Banks' subordinated debentures, net of
   issuance costs  ...................................................          83,104                     -
                                                                             ---------               ---------
               Total liabilities .....................................       3,489,085               3,437,765
                                                                             ---------               ---------

                             STOCKHOLDERS' EQUITY
Preferred stock:
     Class C 9.00% increasing  rate,  redeemable,  cumulative,  $1.00
        par value, $25.00 stated value;  5,000,000 shares authorized; 
        1,916,000 shares and 2,155,500 shares issued and outstanding 
        at March 31, 1997 and December 31, 1996, respectively..........         47,900                  53,887
     Class A, convertible, adjustable rate,
        $20.00 par value; 750,000 shares
        authorized; 641,082 shares issued
        and outstanding ..............................................          12,822                  12,822
     Class B, adjustable rate, $1.50 par value;
        200,000 shares authorized; 160,505 shares
        issued and outstanding .......................................             241                     241
Common stock, $250.00 par value; 25,000 shares
   authorized; 23,661 shares issued
   and outstanding ...................................................           5,915                   5,915
Capital surplus ......................................................           3,109                   3,289
Retained earnings ....................................................         177,740                 171,182
Net fair value adjustment for securities
   available for sale ................................................           3,245                   4,053
                                                                             ---------               ---------
          Total stockholders' equity .................................         250,972                 251,389
                                                                             ---------               ---------
          Total liabilities and stockholders'
            equity ...................................................     $ 3,740,057               3,689,154
                                                                             =========               =========



</TABLE>







See accompanying notes to consolidated financial statements
<PAGE>
                                 FIRST BANKS, INC. AND SUBSIDIARIES
                            Consolidated Statements of Income (unaudited)
                       (dollars expressed in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                                      Three months ended
                                                                                          March 31,
                                                                                          ---------
                                                                                    1997               1996
                                                                                    ----               ----
Interest income:
<S>                                                                              <C>                  <C>   
    Interest and fees on loans.........................................          $ 60,224             58,514
    Investment securities..............................................             7,981              6,842
    Federal funds sold and other.......................................             1,095              1,526
                                                                                   ------             ------
          Total interest income........................................            69,300             66,882
                                                                                   ------             ------
Interest expense:
   Deposits:
       Interest-bearing demand.........................................             1,405              1,286
       Savings.........................................................             5,398              5,795
       Time deposits of $100 or more...................................             2,272              2,534
       Other time deposits.............................................            23,185             22,450
   Federal Home Loan Bank advances.....................................               273                885
   Securities sold under agreements to repurchase......................               319                207
   Interest rate exchange agreements, net .............................             1,207              1,810
   Notes payable and other ............................................               697              1,584
   Cumulative trust preferred securities...............................             1,258                -
                                                                                   ------             ------
          Total interest expense.......................................            36,014             36,551
                                                                                   ------             ------
          Net interest income..........................................            33,286             30,331
Provision for possible loan losses.....................................             2,850              3,104
                                                                                   ------             ------
          Net interest income after provision for possible
            loan losses................................................            30,436             27,227
                                                                                   ------             ------
Noninterest income:
   Service charges on deposit accounts and customer
     service fees......................................................             2,958              3,128
   Credit card fees....................................................               774                599
   Loan servicing fees, net............................................               422                400
   Gain on mortgage loans sold and held for sale.......................               121                103
   Gain on sale of securities, net.....................................                -                 116
    Other income.......................................................               934                547
                                                                                   ------             ------
          Total noninterest income.....................................             5,209              4,893
                                                                                   ------             ------
Noninterest expenses:
   Salaries and employee benefits......................................            10,357             10,333
   Occupancy, net of rental income.....................................             2,603              2,293
   Furniture and equipment.............................................             2,165              1,876
   Federal Deposit Insurance Corporation premiums......................                22                902
   Postage, printing and supplies......................................             1,220              1,372
   Data processing fees................................................             1,128              1,209
   Legal, examination and professional fees............................             1,103              1,476
   Credit card expenses................................................               819                725
   Communications......................................................               689                645
   Advertising.........................................................               648                536
   Losses and expenses on foreclosed real estate,
     net of gains......................................................               113                350
   Other expenses......................................................             3,027              3,320
                                                                                   ------             ------
          Total noninterest expenses...................................            23,894             25,037
                                                                                   ------             ------
          Income before provision for income taxes and
           minority interest in income of subsidiaries.................            11,751              7,083
Provision for income taxes.............................................             3,714              2,564
                                                                                   ------             ------
          Income before minority interest in income
           of subsidiaries.............................................             8,037              4,519
Minority interest in income of subsidiaries............................               201                 82
                                                                                   ------             ------
          Net income...................................................             7,836              4,437
Preferred stock dividends..............................................             1,279              1,434
                                                                                   ------              -----
          Net income available to common shareholders..................          $  6,557              3,003
                                                                                   ======             ======
Earnings per share:
   Primary.............................................................          $ 277.10             126.93
   Fully Diluted.......................................................            266.65             125.52
                                                                                   ======             ======
Weighted average shares of common stock outstanding....................            23,661             23,661
                                                                                   ======             ======
</TABLE>
See accompanying notes to consolidated financial statements



<PAGE>

                              FIRST BANKS, INC. AND SUBSIDIARIES
                       Consolidated Statements of Cash Flows (unaudited)
                    (dollars expressed in thousands, except per share data)

<TABLE>
<CAPTION>


                                                                                     Three months ended
                                                                                          March 31,
                                                                                    1997            1996
Cash flows from operating activities:
<S>                                                                             <C>                    <C>  
   Net income...............................................................    $    7,836             4,437
   Adjustments to reconcile net income to net cash:
      Depreciation and amortization of bank premises
       and equipment........................................................         1,472             1,577
      Amortization, net of accretion........................................           740             1,310
      Originations and purchases of loans held for sale.....................       (20,196)          (27,061)
      Proceeds from sales of loans held for sale ...........................        19,324            25,156
      Provision for possible loan losses....................................         2,850             3,104
      Provision for income taxes currently payable..........................         3,714             2,564
      Payments of income taxes..............................................        (3,000)           (2,275)
      (Increase) decrease in accrued interest receivable ...................          (431)              839
      Interest accrued on liabilities.......................................        36,014            36,918
      Payments of interest on liabilities...................................       (36,873)          (37,544)
      Other, net............................................................        (2,527)             (444)
      Minority interest in income of subsidiaries...........................           201                82
                                                                                   -------           -------
          Net cash provided by operating activities.........................         9,124             8,663
                                                                                   -------           -------
Cash flows from investing activities:
    Cash and cash equivalents received from
      acquisitions..........................................................        40,362                -
    Other sales of investment securities....................................            -             42,621
    Maturities of investment securities.....................................       126,920           108,797
    Purchases of investment securities......................................      (154,434)         (125,875)
    Purchases of mortgage servicing rights..................................            (4)              (25)
    Net (increase) decrease in loans........................................       (43,079)           21,499
    Recoveries of loans previously charged-off .............................         2,633             1,127
    Purchases of bank premises and equipment................................        (1,034)             (884)
    Other investing activities..............................................         1,233             3,070
                                                                                  --------          --------
          Net cash provided by (used in) investing
            activities......................................................       (27,403)           50,330
                                                                                  --------          --------
Cash flows from financing activities:
    Other increases (decreases) in deposits:
      Demand and savings deposits...........................................       (37,240)          (13,066)
      Time deposits.........................................................        36,426           (21,963)
    Increase (decrease) in Federal funds purchased .........................            -              2,000
    Increase (decrease) in Federal Home Loan Bank
      advances..............................................................       (16,251)          (40,257)
    Increase (decrease) in other borrowings.................................        14,239             2,988
    Increase (decrease) in notes payable....................................       (66,116)           (7,590)
    Purchase and retirement of Class C preferred
      shares................................................................        (5,987)                -
    Proceeds from sale of cumulative preferred trust
      securities, net of issuance costs.....................................        83,086                -
    Payment of preferred stock dividends....................................        (1,279)           (1,434)
                                                                                  --------         --------- 
         Net cash provided by (used in) financing
          activities .......................................................         6,878           (79,322)
                                                                                  --------         --------- 
         Net increase (decrease) in cash and
          cash equivalents .................................................       (11,401)          (20,329)
Cash and cash equivalents, beginning of period .............................       227,954           199,213
                                                                                  --------         ---------
Cash and cash equivalents, end of period....................................    $  216,553           178,884
                                                                                  ========         =========
Noncash investing and financing activities:
    Loans transferred to foreclosed real estate.............................    $    1,084             2,244
    Loans transferred to held for sale......................................         2,234              -
                                                                                  ========          ========


See accompanying notes to consolidated financial statements

</TABLE>

<PAGE>


                                FIRST BANKS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  Basis of Presentation

         The accompanying consolidated financial statements of First Banks, Inc.
and  subsidiaries  (First Banks) are unaudited and should be read in conjunction
with the consolidated  financial  statements contained in the 1996 annual report
on Form 10-K.  In the opinion of  management,  all  adjustments,  consisting  of
normal recurring  accruals  considered  necessary for a fair presentation of the
results of  operations  for the  interim  periods  presented  herein,  have been
included.  Operating  results for the three  months ended March 31, 1997 are not
necessarily indicative of the results that may be expected for any other interim
period or for the year ending December 31, 1997.

         First Banks' primary subsidiaries (Subsidiary Banks) are:

              First Bank, headquartered in St. Louis County, Missouri
                  (First Bank Missouri)
              First Bank, headquartered in O'Fallon, Illinois (First Bank
                  Illinois)
              First Bank FSB, headquartered in St. Louis County, Missouri
                  (First Bank FSB)
              First Banks America, Inc., headquartered in Houston, Texas (FBA)
              CCB Bancorp, Inc., headquartered in Irvine, California (CCB)
              First Commercial Bancorp, Inc., headquartered in Sacramento,
                  California (FCB)

         First Bank  Missouri and First Bank  Illinois are wholly owned  banking
subsidiaries.  First Bank FSB is a wholly owned thrift subsidiary. CCB, a wholly
owned bank holding  company  subsidiary,  operates  through  First Bank & Trust,
headquartered  in Santa  Ana,  California  (FB&T).  FBA, a  majority-owned  bank
holding company subsidiary, operates through two banking subsidiaries, BankTEXAS
N.A.,  headquartered  in Houston,  Texas (BTX) and Sunrise  Bank of  California,
headquartered in Roseville,  California  (Sunrise).  FCB, a majority-owned  bank
holding   company   subsidiary,   operates   through  First   Commercial   Bank,
headquartered in Sacramento, California (First Commercial).

         First Banks'  ownership  interest in FBA was 69.40% and 68.82% at March
31, 1997 and December 31, 1996, respectively. First Banks' ownership interest in
FCB was 61.46% at March 31, 1997 and December 31, 1996.

         The  consolidated  financial  statements  include the accounts of First
Banks, Inc. and its  subsidiaries,  net of minority  interests.  All significant
intercompany  accounts and transactions  have been eliminated in  consolidation.
Certain  reclassifications  of 1996  amounts  have been made to conform with the
1997 presentation.

(2)  Acquisitions

         On March 27, 1997, First Banks completed its assumption of the deposits
and  purchase  of  selected  assets of the two Long  Beach,  California  banking
locations of Highland Federal Bank, FSB. The purchase provided deposits of $40.4
million and will operate as branches of FB&T.



<PAGE>


(3)  Cumulative Trust Preferred Securities of First Preferred Capital Trust

         On February 4, 1997, First Preferred  Capital Trust (First Capital),  a
newly-formed  Delaware  business  trust  subsidiary of First Banks,  issued 3.45
million  shares  of  9.25%  Cumulative  Trust  Preferred  Securities  (Preferred
Securities)  at $25 per share in an  underwritten  public  offering  and  issued
106,702 shares of Common Securities to First Banks at $25 per share. First Banks
owns all of  First  Capital's  Common  Securities.  The  gross  proceeds  of the
offering  were  used  by  First  Capital  to  purchase  a   $88,917,550,   9.25%
Subordinated  Debentures   (Subordinated   Debentures)  from  First  Banks.  The
Subordinated  Debentures are the sole asset of First Capital. In connection with
the issuance of the Preferred  Securities,  First Banks made certain  guarantees
and  commitments  that, in the  aggregate,  constitute a full and  unconditional
guarantee by First Banks of the obligations of First Capital under the Preferred
Securities.  First  Banks'  proceeds  from  the  issuance  of  the  Subordinated
Debenture to First Capital, net of underwriting fees and offering expenses, were
$83.1  million.  Distributions  payable on the  Preferred  Securities  were $1.3
million for the three  months  ended March 31, 1997 and are recorded as interest
expense in the accompanying consolidated financial statements.
         The  proceeds  from  the  offering  were  used  for  general  corporate
purposes,  including the reduction of borrowings under a credit agreement with a
group of  unaffiliated  banks (Credit  Agreement)  and the repurchase of 284,000
shares of Class C Increasing Rate, Redeemable, Cumulative Preferred Stock (Class
C  Preferred  Stock)  for  $7.3  million.   The  remaining  proceeds  have  been
temporarily invested.

(4)  Regulatory Capital

         The  Subsidiary  Banks  are  subject  to  various   regulatory  capital
requirements administered by the federal and state banking agencies.  Failure to
meet minimum capital  requirements can initiate  certain  mandatory and possibly
additional discretionary actions by regulators that, if undertaken, could have a
direct  material effect on the Subsidiary  Banks'  financial  statements.  Under
capital adequacy  guidelines and the regulatory  framework for prompt corrective
action,  the Subsidiary Banks must meet specific capital guidelines that involve
quantitative measures of the Subsidiary Banks' assets, liabilities,  and certain
off-balance-sheet items as calculated under regulatory accounting practices. The
Subsidiary  Banks'  capital  amounts  and  classification  are also  subject  to
qualitative judgments by the regulators about components,  risk weightings,  and
other factors.

         Quantitative  measures  established  by  regulations  to ensure capital
adequacy require the Subsidiary  Banks to maintain  certain minimum ratios.  The
Subsidiary  Banks are  required  to  maintain  a minimum  risk-based  capital to
risk-weighted  assets  ratio of 8.0%,  with at least 4.0% being "Tier 1" capital
(as defined in the regulations).  In addition,  a minimum leverage ratio (Tier 1
capital to total assets) of 3.0% plus an additional  cushion of 100 to 200 basis
points  is  expected.  As of  August  31,  1995,  the  date of the  most  recent
notification  from First Banks'  primary  regulator,  the  Subsidiary  Banks and
thrifts were categorized as well capitalized under the regulatory  framework for
prompt  corrective  action,  except for BTX which was  categorized as adequately
capitalized.  There have been no  conditions  or events since that  notification
that  management  believes  have  changed  these  Subsidiary  Banks'  and thrift
category,  except for BTX, which  management  believes is now well  capitalized.
Management  believes,  as of March 31,  1997,  all of the  Subsidiary  Banks and
thrifts  are well  capitalized  as  defined  by the  Federal  Deposit  Insurance
Corporation Act.
          At  March  31,  1997 and  December  31,  1996,  First  Banks'  and the
Subsidiary Banks' capital ratios were as follows:
<TABLE>
<CAPTION>

                                                       Risk based capital ratios
                                             -----------------------------------------
                                                  Total                     Tier 1            Leverage Ratio
                                                  -----                     ------            --------------
                                             1997       1996            1997      1996        1997      1996
                                             ----       ----            ----      ----        ----      ----

<S>                                          <C>        <C>            <C>       <C>         <C>       <C>  
         First Banks                         12.33%      9.23%          8.16%     7.92%       6.15%     5.99%
         First Bank FSB                      11.08      11.00           9.83      9.75        6.78      6.45
         First Bank Missouri                 10.02      10.47           8.77      9.21        7.36      7.25
         First Bank Illinois                 11.37      11.06          10.12      9.88        7.33      7.17
         FB&T                                16.05      16.45          14.78     15.18       10.47     11.43
         BankTEXAS                           11.01      10.29           9.75      9.04        7.92      7.53
         Sunrise (1)                         18.81      17.67          17.53     16.39       11.32     10.88
         First Commercial                    14.02      13.13          12.73     11.84        8.85      8.87
----------------
(1) Sunrise was acquired on November 1, 1996.
</TABLE>


<PAGE>


                 Item 2: Management's Discussion and Analysis of
                  Financial Condition and Results of Operations

                                     General

         First Banks is a  registered  bank  holding  company,  incorporated  in
Missouri in 1978 and headquartered in St. Louis County,  Missouri.  At March 31,
1997,  First  Banks had $ 3.7  billion in total  assets;  $2.8  billion in total
loans,  net of unearned  discount;  $3.3 billion in total  deposits;  and $251.0
million in total stockholders' equity.

         Through  the  Subsidiary  Banks,  First  Banks  offers a broad range of
commercial  and  personal  banking  services  including  certificate  of deposit
accounts,  individual  retirement and other time deposit accounts,  checking and
other demand deposit accounts,  interest checking accounts, savings accounts and
money market accounts. Loans include commercial,  financial,  agricultural, real
estate construction and development,  commercial and residential real estate and
consumer and  installment  loans.  Other  financial  services  include  mortgage
banking,  discount  brokerage,   credit-related   insurance,   automatic  teller
machines,  safe deposit boxes and trust services  offered by certain  Subsidiary
Banks.

         The following table lists the Subsidiary Banks at March 31, 1997:
<TABLE>
<CAPTION>

                                                                                 Loans,  net
                              Percent of    No. of                               of unearned     Total
Subsidiary Banks              ownership     locations         Total assets        discounts     deposits
----------------              ---------     ---------         ------------        ---------     --------
                                                               (dollars expressed in thousands)

<S>                            <C>              <C>         <C>                   <C>            <C>    
First Bank FSB                 100.00%          40          $ 1,024,383           854,452        905,220
First Bank Missouri            100.00%          31              839,135           673,812        745,759
First Bank Illinois            100.00%          27              836,666           633,807        764,705
CCB                            100.00%          13              504,168           316,807        434,532
FBA                             69.40%           8              373,887           234,237        313,843
FCB                             61.46%           6              155,285            92,778        138,612
</TABLE>

                               Financial Condition

         First  Banks' total  assets  increased by $50 million to $3.74  billion
from $3.69  billion at March 31, 1997 and December 31, 1996,  respectively.  The
increase is primarily attributable to the increase in net loans of $37.3 million
and the increase of investment securities of $26.7 million,  partially offset by
a reduction in cash and cash  equivalents of $11.4 million.  The  composition of
the increase in net loans is discussed under  "--Lending and Credit  Management"
of this Form 10-Q.

                              Results of Operations

Net Income

         Net income for the three months ended March 31, 1997 was $7.84 million,
compared to $4.44  million for the same period in 1996, an increase of 77%. This
represents a return on average stockholders' equity and return on average assets
ratios of  12.55%  and .86% for the  three  months  ended  March  31,  1997,  in
comparison to 7.54% and .50% for the same period in 1996. This further  compares
to a return on  average  stockholders'  equity and  average  assets for the year
ended December 31, 1996 of 8.43% and .57%,  respectively.  The improved earnings
are  attributable to the increase in net interest income of $3.0 million and the
reduction  in  noninterest  expense of $1.1  million for the three  months ended
March 31, 1997, compared to the same period in 1996.

Net Interest Income

         Net interest income  (expressed on a tax-equivalent  basis) improved to
$33.5 million, or 3.93% of average interest earning assets, for the three months
ended March 31, 1997, from $30.4 million,  or 3.64% of average  interest earning
assets, for the same period in 1996.

         The increased net interest income for 1997 is primarily attributable to
the  increased  yield on the loan  portfolio  to 8.68%  from 8.58% for the three
months ended March 31, 1997 and 1996,  respectively.  This improved yield on the
loan portfolio  reflects the continual  process of realigning the loan portfolio
from residential  real estate loans to other types of loans,  such as commercial
and construction loans.

         This realignment of the loan portfolio  combined with the gradual shift
in the composition of the investment securities portfolios, from mortgage-backed
securities to U.S.  Treasury and generic U.S.  government  agencies  securities,
resulted in a reduction of the overall  interest rate risk of First Banks.  This
reduction of the interest rate risk profile  contributed to net interest  income
by reducing  the need for hedging the  Company's  position,  and  therefore  its
associated  cost,  and by increasing  the  responsiveness  of the Company to the
generally  increasing  interest rates which occurred during the first quarter of
1997.  Accordingly,  the cost of hedging decreased to $1.2 million for the three
months ended March 31, 1997, from $2.4 million for the same period in 1996.

         The following  table sets forth,  on a  tax-equivalent  basis,  certain
information  relating to First Banks' average  balance  sheet,  and reflects the
average  yield  earned  on   interest-earning   assets,   the  average  cost  of
interest-bearing liabilities and the resulting net interest income for the three
months ended March 31:
<TABLE>
<CAPTION>

                                                                   Three months ended March 31,
                                                               1997                            1996            
                                                      --------------------------    ----------------------------
                                                                 Interest                       Interest
                                                      Average    income/  Yield/     Average    income/    Yield/
                                                      balance    expense  rate       balance    expense    rate
                                                      -------    -------  ----       -------    -------    ----
                                                                   (dollars expressed in thousands)
                      Assets
                      ------
Interest-earning assets:
<S>                                                <C>           <C>     <C>     <C>            <C>        <C>  
   Loans.......................................... $2,778,505    60,320  8.68%   $ 2,723,406    58,410     8.58%
   Investment securities..........................    554,464     8,119  5.86        502,486     7,022     5.59
   Federal funds sold and other...................     80,208     1,095  5.46        114,134     1,525     5.34
                                                    ---------   -------            ---------    ------          
         Total interest-earning assets............  3,413,177    69,534  8.15      3,340,026    66,957     8.02
                                                                -------                         ------    
Nonearning assets.................................    234,780                        224,191
                                                    ---------                      ---------
         Total assets............................. $3,647,957                    $ 3,564,217
                                                    ---------                      =========

       Liabilities and Stockholders' Equity
       ------------------------------------
 Interest-bearing liabilities:
   Interest-bearing demand deposits............... $  333,941     1,405  1.68%   $   305,766     1,286     1.68%
   Savings deposits...............................    682,041     5,398  3.17        690,643     5,795     3.36
   Time deposits of $100 or more..................    165,195     2,272  5.50        184,091     2,714     5.90
   Other time deposits............................  1,676,720    24,392  5.82      1,602,120    24,019     6.00
                                                   ----------   -------            ---------    ------          
Total interest-bearing
       deposits...................................  2,857,897    33,467  4.68      2,782,620    33,814     4.86
Federal Home Loan Bank advances, notes payable
   and other......................................    140,614     2,547  7.25        148,984     2,737     7.35
                                                    ---------    ------            ---------    ------          
         Total interest-bearing
              liabilities.........................  2,998,511    36,014  4.80      2,931,604    36,551     4.99
                                                                 ------                         ------          
Noninterest-bearing liabilities:
   Demand deposits................................    363,014                        360,698
   Other liabilities..............................     36,617                         36,618
                                                    ---------                      ---------
         Total liabilities........................  3,398,142                      3,328,920
Stockholders' equity..............................    249,815                        235,297
                                                    ---------                      ---------
         Total liabilities and
              stockholders' equity................ $3,647,957                    $ 3,564,217
                                                    =========                      =========
         Net interest income......................               33,520                        30,406
                                                                 ======                        ======
         Net interest margin......................                       3.93%                             3.64%
                                                                         =====                             =====
</TABLE>
<PAGE>

Provision for Possible Loan Losses

         The  provision  for possible  loan losses was $2.9 million  compared to
$3.1 million for the three  months ended March 31, 1997 and 1996,  respectively.
The slightly lower level of provision in 1997 reflects  substantially  decreased
net loan  charge-offs  in the period  compared with the same period of 1996. Net
loan charge-offs were $2.1 million for the three months ended March 31, 1997, in
comparison to $5.7 million for the three months ended March 31, 1996.

         Following  various  acquisitions  during  1994 and  1995,  First  Banks
pursued   aggressive   problem   loan  work  out   procedures   which   included
conservatively  re-valuing loans through  charge-offs.  While these  adjustments
were anticipated prior to the acquisitions and adequate reserves for loan losses
had been  established to provide for them,  loan  charge-offs  began to increase
during 1996. However, as this work-out program progressed, loan charge-offs have
declined while  recoveries of loans previously  charged-off  have  significantly
increased.

         Tables summarizing  nonperforming assets, past due loans and charge-off
experience are presented  under  "--Lending and Credit  Management" of this Form
10-Q.

Noninterest Income

         Noninterest  income was $5.2  million for the three  months ended March
31, 1997 in comparison to $4.9 million for the same period in 1996.  Noninterest
income  consists  primarily  of service  charges on deposit  accounts  and other
non-yield customer service fees.

         Service charges on deposit accounts and customer service fees decreased
to $2.96  million  from $3.13  million for the three months ended March 31, 1997
and 1996, respectively. The decrease is attributable to the development of First
Banks'  "aggregate  balance pricing  structure"  whereby  customers  maintaining
specified  deposit  balances,  determined  on an aggregate  basis of any deposit
relationship with First Banks, may avoid certain service charges.

Noninterest Expenses

         Noninterest  expense  decreased by $1.1  million to $23.9  million from
$25.0 million for the three months ended March 31, 1997 and 1996,  respectively.
The decrease is  attributable  to cost savings  realized upon the integration of
the  entities  acquired  throughout  1994 and 1995  into  existing  systems  and
cultures  of  First  Banks  and  the  decrease  in  Federal  Deposit   Insurance
Corporation  (FDIC)  premiums,  partially  offset by the additional  noninterest
expense of Sunrise Bank acquired on November 1, 1996. Sunrise Bank's noninterest
expense was $1.2 million for the three months ended March 31, 1997.

         FDIC  premiums  decreased to $22,000 from $902,000 for the three months
ended March 31, 1997 and 1996, respectively, as a result of the reduction in the
assessment rate charged on deposits insured by the Savings Association Insurance
Fund (SAIF) of the FDIC. The reduction in the assessment rate was effective upon
the  recapitalization  of the SAIF,  accomplished by a one-time  special deposit
insurance charge assessed to all financial institutions with deposits insured by
the SAIF. First Banks' one-time charge totaled $8.2 million and was reflected in
the operating results during the third quarter of 1996.
<PAGE>

                          Lending and Credit Management

         Interest  earned on the loan  portfolio is the primary source of income
of First Banks.  Total loans,  net of unearned  discount,  represented  75.0% of
total assets as of March 31, 1997 and December 31, 1996. Total loans,  excluding
loans held for sale and net of unearned  discount,  increased  by $40 million to
$2.78  billion at March 31, 1997 from $2.74  billion at December 31,  1996.  The
increase  reflects  continued growth within corporate  lending of $78.7 million,
offset by the decrease of the residential  mortgage and consumer and installment
loan portfolios of $17.9 million and $20.8 million,  respectively,  at March 31,
1997 in comparison to December 31, 1996. These decreases are attributable to the
reductions of new loan origination  volumes that are held for investment and the
continued repayment of principal on the existing portfolios.

         The following is a summary of nonperforming assets by category:
<TABLE>
<CAPTION>

                                                          March 31,         December 31,
                                                            1997               1996
                                                            ----               ----
                                                      (dollars expressed in thousands)

<S>                                               <C>                            <C>  
Commercial, financial and agricultural                $     3,347                4,243
Real estate construction and development                      382                  817
Real estate mortgage                                       24,422               24,764
Consumer and installment                                    1,190                  445
                                                        ---------            ---------
         Total nonperforming loans                         29,341               30,269
Other real estate                                          10,013               10,607
                                                        ---------            ---------
         Total nonperforming assets                   $    39,354               40,876
                                                        =========            =========
Loans, net of unearned discount                       $ 2,805,991            2,767,969
                                                        =========            =========
Loans past due 90 days or more
   and still accruing                                 $     2,712                3,779
                                                        =========            =========

Asset Quality Ratios:
   Allowance for possible loan
    losses to loans                                         1.69%                 1.69%
   Nonperforming loans to loans                             1.05                  1.09
   Allowance for possible loan losses
    to nonperforming loans                                161.97                154.55
   Nonperforming assets to loans and
    other real estate                                       1.40                  1.47
                                                            ====                  ====
</TABLE>

          Impaired loans, consisting of nonaccrual loans, were $29.3 million and
$30.3 million at March 31, 1997 and December 31, 1996, respectively.

         The  following is a summary of the loan loss  experience  for the three
months ended March 31:

                                                               1997       1996
                                                               ----       ----
                                                             (dollars expressed
                                                                in thousands)
Allowance for possible loan losses,
 beginning of period                                        $ 46,781     52,665
Loans charged-off                                             (4,741)    (6,851)
Recoveries of loans previously charged-off                     2,633      1,127
                                                              ------     ------
   Net loan (charge-offs) recoveries                          (2,108)    (5,724)
                                                              ------     ------ 
Provision for possible loan losses                             2,850      3,104
                                                              ------     ------
Allowance for possible loan losses, end of period           $ 47,523     50,045
                                                              ======     ======

         The  allowance  for  possible  loan  losses  is based on past loan loss
experience,  on  management's  evaluation  of the  quality  of the  loans in the
portfolio  and  on  the  anticipated  effect  of  national  and  local  economic
conditions relative to the ability of loan customers to repay. Each quarter, the
allowance for possible loan losses is revised  relative to First Banks' internal
watch list and other data utilized to determine its adequacy.  The provision for
possible  loan  losses is  management's  estimate  of the  amount  necessary  to
maintain  the  allowance  at  a  level  consistent  with  this  evaluation.   As
adjustments to the allowance for possible loan losses are considered  necessary,
they are reflected in the results of operations.

                          Interest Rate Risk Management

         Derivative  financial  instruments  held by First Banks for purposes of
managing interest rate risk are summarized as follows:

                                           March 31, 1997     December 31,1996
                                           --------------     ----------------
                                         Notional  Credit     Notional  Credit
                                          amount  exposure     amount  exposure
                                         -------  --------     ------  --------
                                            (dollars expressed in thousands)

 
   Interest rate swap agreements        $70,000      -         70,000      -
   Interest rate floor agreements       105,000      58       105,000     141
   Interest rate cap agreements          10,000     403        10,000     335
   Forward commitments to sell
       mortgage-backed  securities       37,000     533        35,000     308

         The  notional  amounts  of  derivative  financial  instruments  do  not
represent amounts exchanged by the parties and, therefore,  are not a measure of
First  Banks'  credit   exposure   through  its  use  of  derivative   financial
instruments.  The amounts  exchanged are determined by reference to the notional
amounts and the other terms of the derivatives.

         Interest  rate swap  agreements  are  utilized to extend the  repricing
characteristics  of certain  interest-bearing  liabilities  to  correspond  more
closely with the assets of First Banks,  with the objective of  stabilizing  net
interest  income over time.  The net interest  expense for these  agreements was
$1.2 million for the three months ended March 31, 1997,  in  comparison  to $1.8
million for the same  period in 1996.  The  maturity  dates,  notional  amounts,
interest  rates  paid and  received,  and fair  values  of  interest  rate  swap
agreements outstanding as of the dates indicated are summarized as follows:

                                 Notional    Interest Rate       Fair Value
                                            --------------                    
      Maturity date               Amount    Paid  Received       Gain (loss)
      -------------               ------    ----  --------      -----------
                                            (dollars expressed in thousands)
March 31, 1997:
   September 30, 1997           $ 35,000    7.04%     5.75%      $  (240)
   September 30, 1999             35,000    7.32      5.75          (660)
                                  ------                            ---- 
                                $ 70,000    7.18      5.75       $  (900)
                                  ======    ====      ====          ==== 

December  31, 1996:
   September 30, 1997           $ 35,000    7.04%     5.59%      $  (417)
   September 30, 1999             35,000    7.32      5.59        (1,160)
                                  ------                          ------ 
                                $ 70,000    7.18      5.59       $(1,577)
                                  ======    ====      ====        ====== 

         First Banks  shortened the effective  maturity of its  interest-bearing
liabilities  through the  termination  of interest rate swap  agreements of $225
million during July 1995 and $75 million during November 1996 at a loss of $13.5
million and $5.3 million, respectively.  These losses have been deferred and are
being  amortized over the remaining lives of the swap  agreements.  At March 31,
1997 and December 31, 1996,  the  unamortized  balance of these losses was $12.6
million and $13.4 million,  respectively,  and was included in other assets. The
amortization of the deferred loss included in interest  expense was $755,000 for
the three month period ended March 31, 1997,  in  comparison to $923,000 for the
same time period in 1996.
<PAGE>

         First Banks also has interest  rate cap and floor  agreements  to limit
the interest expense  associated with certain  interest-bearing  liabilities and
the net interest expense of certain interest rate swap agreements, respectively.
At March  31,  1997 and  December  31,  1996,  the  unamortized  costs for these
agreements were $396,000 and $433,000,  respectively, and were included in other
assets.  The net interest  expense of the interest rate cap and floor agreements
was $37,000 for the three months ended March 31, 1997 in  comparison  to $72,000
for the same  period  in 1996.  There  are no  amounts  receivable  under  these
agreements.

         Derivative  financial  instruments  issued by First  Banks  consist  of
commitments to originate  fixed-rate loans.  Commitments to originate fixed-rate
loans  consist   primarily  of  residential   real  estate  loans.   These  loan
commitments,  net of estimated underwriting fallout, and loans held for sale are
hedged with forward contracts to sell mortgage-backed securities.

                                    Liquidity

         The liquidity of First Banks and its Subsidiary Banks is the ability to
maintain  a cash  flow  which  is  adequate  to fund  operations,  service  debt
obligations and meet other commitments on a timely basis. The primary sources of
funds  for  liquidity  are  derived  from  customer  deposits,   loan  payments,
maturities, sales of investments and earnings.

         In addition,  First Banks and its Subsidiary Banks may avail themselves
of more volatile sources of funds through issuance of certificates of deposit in
denominations of $100,000 or more, federal funds borrowed, securities sold under
agreements to repurchase, borrowings from the Federal Home Loan Bank (FHLB), and
other  borrowings,  including  First Banks' $90 million credit  agreement with a
group of unaffiliated financial institutions.  The aggregate funds acquired from
those  sources  were  $260.1  million at March 31,  1997 and  $315.4  million at
December 31, 1996.  The decrease is primarily  attributable  to the reduction in
notes  payable  from  the  proceeds  received  from  the  sale of the  Preferred
Securities. See note 3 to the accompanying consolidated financial statements.

         At March 31, 1997,  First Banks' more volatile  sources of funds mature
as follows:

                                                         (dollars expressed
                                                            in thousands)

         Three months or less                               $   99,327
         Over three months through six months                   55,162
         Over six months through twelve months                  57,061
         Over twelve months                                     48,521
                                                              --------
           Total                                             $ 260,071
                                                               =======

         Management believes the future earnings of its Subsidiary Banks will be
sufficient  to  provide  funds for  growth  and to permit  the  distribution  of
dividends  to First Banks  sufficient  to meet First Banks'  operating  and debt
service  requirements  both on a short-term  and long-term  basis and to pay the
dividends on the Class C Preferred Stock and the Preferred Securities.

                       Effects of New Accounting Standards

         First  Banks  adopted  the  provisions  of  SFAS  125,  Accounting  for
Transfers and Servicing of Financial  Assets and  Extinguishment  of Liabilities
(SFAS 125) prospectively on January 1, 1997. SFAS 125 established accounting and

<PAGE>

reporting  standards  for  transfers  and  servicing  of  financial  assets  and
extinguishment of liabilities.

         The  standards   established  by  SFAS  125  are  based  on  consistent
applications of a  financial-components  approach that focuses on control. Under
that approach,  after a transfer of financial  assets,  an entity recognizes the
financial and servicing  assets it controls and the liabilities it has incurred,
derecognizes   financial   assets  when  control  has  been   surrendered,   and
derecognizes  liabilities  when  extinguished.   SFAS  125  provides  consistent
standards for  distinguishing  transfers of financial assets that are sales from
transfers that are secured borrowings.

         The  implementation  of SFAS 125 did not have a material  effect on the
consolidated financial position or results of operation of First Banks.

           In February 1997, the FASB issued SFAS 128,  Earnings Per Share (SFAS
128). SFAS 128 supersedes  Accounting  Principles Board Opinion No. 15, Earnings
Per Share (APB 15) and specifies the computation,  presentation,  and disclosure
requirements for earnings per share (EPS) for entities with publicly held common
stock or potential common stock. SFAS 128 was issued to simplify the computation
of EPS and to make the U.S.  standard more  compatible with the EPS standards of
other countries and that of the International Accounting Standards Committee. It
replaces the  presentation  of primary EPS with a presentation  of basic EPS and
fully diluted EPS with diluted EPS. SFAS 128 also requires dual  presentation of
basic and diluted EPS on the face of the income  statement for all entities with
complex capital  structures,  and requires a reconciliation of the numerator and
denominator of the basic EPS computation to the numerator and denominator of the
diluted EPS computation.

           Basic EPS, unlike primary EPS,  excludes  dilution and is computed by
dividing income available to common  stockholders by the weighted average number
of common shares outstanding for the period.  Diluted EPS reflects the potential
dilution that could occur if securities or other contracts to issue common stock
were  exercised and  converted  into common stock or resulted in the issuance of
common  stock that then shared in the  earnings  of the  entity.  Diluted EPS is
computed similarly to fully diluted EPS under APB 15.

           SFAS 128 is effective for financial  statements  for both interim and
annual  periods  ending  after  December 15, 1997.  Earlier  application  is not
permitted. After adoption, all prior-period EPS data presented shall be restated
to conform with SFAS 128.

           First Banks does not believe the implementation of SFAS 128 will have
a material effect on its computation of earnings per share.

          In February 1997, the FASB issued SFAS 129,  Disclosure of Information
about  Capital  Structure  (SFAS  129).  SFAS  129  establishes   standards  for
disclosing  information about an entity's capital  structure.  It applies to all
entities.  SFAS 129  continues  the previous  requirements  to disclose  certain
information  about  an  entity's  capital  structure  found  in APB 10,  Omnibus
Opinion-1966,  APB 15 and SFAS 47,  Disclosure  of  Long-Term  Obligations,  for
entities  that were subject to the  requirements  of those  standards.  SFAS 129
eliminates  the  exemption  of  nonpublic   entities  from  certain   disclosure
requirements  of APB 15 as provided by SFAS 21,  Suspension  of the Reporting of
Earnings  Per  Share  and  Segment  Information  by  Nonpublic  Enterprises.  It
supersedes  specific  disclosure  requirements of APB 10, APB 15 and SFAS 47 and

<PAGE>

consolidates  them in SFAS 129 for ease of retrieval and for greater  visibility
to nonpublic entities.

         SFAS 129 is effective for financial statements for periods ending after
December 15, 1997. It contains no change in disclosure requirements for entities
that were previously subject to the requirements of APB 10 and 15 and SFAS 47.


                           Part II- OTHER INFORMATION


Item 6.  Exhibits and Reports on Form 8-K

   (a) These Exhibits are numbered in accordance  with the Exhibit Table of Item
601 of Regulation S-K.

              Exhibit
              Number       Description

                   4(a)    Agreement As To Expenses and Liabilities

                   4(b)    Preferred Securities Guarantee Agreement

                   4(c)    Indenture

                   4(d)    Amended and Restated Trust Agreement

                  11       Calculations of Earnings per Share

                  27       Financial Data Schedule (EDGAR only)

   (b)  First Banks, Inc. filed no reports on Form 8-K during the three month
 period ended March 31, 1997.




<PAGE>




                                   SIGNATURES


         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.






                                           FIRST BANKS, INC.
                                           Registrant


Date:  May 13, 1997                   By:  /s/ James F. Dierberg
                                           ---------------------
                                            James F. Dierberg
                                            Chairman, President and
                                            Chief Executive Officer



Date:  May 13, 1997                   By:   /s/ Allen H. Blake
                                           -------------------
                                            Allen H. Blake
                                            Senior Vice President
                                            and Chief Financial Officer
                                            (Principal Financial Officer)


<PAGE>




                                                   Exhibit 4(a)














                    AGREEMENT AS TO EXPENSES AND LIABILITIES


<PAGE>




                    AGREEMENT AS TO EXPENSES AND LIABILITIES


         AGREEMENT AS TO EXPENSES AND LIABILITIES (this "Agreement") dated as of
February 4, 1997,  between  FIRST BANKS,  INC., a Missouri  corporation  ("First
Banks"),  and FIRST  PREFERRED  CAPITAL  TRUST,  a Delaware  business trust (the
"Trust").

                                    RECITALS

         WHEREAS,  the Trust intends to issue its common securities (the "Common
Securities") to, and receive  Debentures from, First Banks and to issue and sell
First Preferred  Capital Trust 9.25% Cumulative Trust Preferred  Securities (the
"Preferred  Securities")  with such powers,  preferences  and special rights and
restrictions as are set forth in the Amended and Restated Trust Agreement of the
Trust dated as of February 4, 1997, as the same may be amended from time to time
(the "Trust Agreement");

         WHEREAS, First Banks shall directly or indirectly own all of the Common
Securities of the Trust and shall issue the Debentures;

         NOW, THEREFORE,  in consideration of the purchase by each holder of the
Preferred  Securities,  which  purchase  First Banks hereby agrees shall benefit
First  Banks  and  which  purchase  First  Banks  acknowledges  shall be made in
reliance  upon the  execution  and  delivery  of this  Agreement,  First  Banks,
including  in its  capacity  as holder of the Common  Securities,  and the Trust
hereby agree as follows:

                                    ARTICLE I

         Section 1.1.  Guarantee by First Banks.

         Subject to the terms and conditions hereof,  First Banks,  including in
its  capacity  as  holder  of the  Common  Securities,  hereby  irrevocably  and
unconditionally  guarantees to each person or entity to whom the Trust is now or
hereafter becomes indebted or liable (the "Beneficiaries") the full payment when
and as  due,  of any  and  all  Obligations  (as  hereinafter  defined)  to such
Beneficiaries.  As used  herein,  "Obligations"  means any  costs,  expenses  or
liabilities  of the Trust other than  obligations of the Trust to pay to holders
of any Preferred  Securities or other similar interests in the Trust the amounts
due such holders pursuant to the terms of the Preferred Securities or such other
similar interests,  as the case may be. This Agreement is intended to be for the
benefit of, and to be  enforceable  by, all such  Beneficiaries,  whether or not
such Beneficiaries have received notice hereof.

         Section 1.2.  Term of Agreement.

         This  Agreement  shall  terminate and be of no further force and effect
upon  the  later  of (a) the date on which  full  payment  has been  made of all
amounts  payable to all holders of all the  Preferred  Securities  (whether upon
redemption, liquidation, exchange or otherwise); and (b) the date on which there
are no Beneficiaries  remaining;  provided,  however,  that this Agreement shall

<PAGE>

continue to be effective or shall be  reinstated,  as the case may be, if at any
time any holder of Preferred  Securities or any Beneficiary must restore payment
of any sums paid under the Preferred Securities, under any obligation, under the
Preferred  Securities  Guarantee  Agreement dated the date hereof by First Banks
and State Street Bank and Trust  Company,  as guarantee  trustee,  or under this
Agreement for any reason whatsoever. This Agreement is continuing,  irrevocable,
unconditional and absolute.

         Section 1.3.  Waiver of Notice.

         First Banks hereby waives notice of acceptance of this Agreement and of
any  obligation to which it applies or may apply,  and First Banks hereby waives
presentment,  demand  for  payment,  protest,  notice of  nonpayment,  notice of
dishonor, notice of redemption and all other notices and demands.

         Section 1.4.  No Impairment.

         The obligations,  covenants, agreements and duties of First Banks under
this  Agreement  shall  in no way be  affected  or  impaired  by  reason  of the
happening from time to time of any of the following:

          (a) the  extension  of time for the payment by the Trust of all or any
portion of the obligations or for the performance of any other obligation under,
arising out of, or in connection with, the obligations;

         (b) any  failure,  omission,  delay or lack of diligence on the part of
the Beneficiaries to enforce, assert or exercise any right, privilege,  power or
remedy  conferred on the  Beneficiaries  with respect to the  obligations or any
action on the part of the Trust granting indulgence or extension of any kind; or

         (c) the voluntary or involuntary liquidation,  dissolution, sale of any
collateral, receivership,  insolvency, bankruptcy, assignment for the benefit of
creditors,  reorganization,  arrangement composition or readjustment of debt of,
or other similar  proceedings  affecting,  the Trust or any of the assets of the
Trust.

There shall be no obligation of the  Beneficiaries  to give notice to, or obtain
the  consent  of,  First  Banks  with  respect  to the  happening  of any of the
foregoing.

         Section 1.5.  Enforcement.

         A Beneficiary may enforce this Agreement  directly against First Banks,
and First Banks waives any right or remedy to require that any action be brought
against the Trust or any other person or entity before proceeding  against First
Banks.

                                   ARTICLE II

         Section 2.1.  Binding Effect.

         All guarantees and  agreements  contained in this Agreement  shall bind
the successors,  assigns, receivers, trustees and representatives of First Banks
and shall inure to the benefit of the Beneficiaries.
<PAGE>

         Section 2.2.  Amendment.

         So long as there remains any Beneficiary or any Preferred Securities of
any series are  outstanding,  this Agreement shall not be modified or amended in
any  manner  adverse to such  Beneficiary  or to the  holders  of the  Preferred
Securities.

         Section 2.3.  Notices.

         Any notice,  request or other communication required or permitted to be
given  hereunder  shall be given in writing by delivering  the same by facsimile
transmission  (confirmed by mail),  telex,  or by registered or certified  mail,
addressed as follows (and if so given, shall be deemed given when mailed or upon
receipt of an answer back, if sent by telex):

         First Preferred Capital Trust
         c/o  First Banks, Inc.
         11901 Olive Boulevard
         St. Louis, MO 63141
         Facsimile No.: (314) 567-3490
         Attention: Chief Financial Officer

         First Banks, Inc.
         11901 Olive Boulevard
         St. Louis, MO 63141
         Facsimile No.: (314) 567-3490
         Attention: Chief Financial Officer

         Section 2.4.  This  agreement  shall be governed by and  construed  and
interpreted in accordance with the laws of the State of Missouri (without regard
to conflict of laws principles).

         THIS AGREEMENT is executed as of the day and year first above written.

                                      FIRST BANKS, INC.

                                      By:  /s/ Allen H. Blake
                                      Name:  Allen H. Blake
                                      Title: Executive Vice President,
                                      Chief Financial Officer and Secretary


                                      FIRST PREFERRED CAPITAL TRUST

                                      By:  /s/ Laurence J. Brost
                                      Name:  Laurence J. Brost
                                      Title: Administrative Trustee


<PAGE>


                                                                 Exhibit 4(b)













                    PREFERRED SECURITIES GUARANTEE AGREEMENT


                                 by and between



                                FIRST BANKS, INC.


                                       and


                       STATE STREET BANK AND TRUST COMPANY





                                                  February 4, 1997










<PAGE>


                                TABLE OF CONTENTS
                                                                           Page
                                                                            No.

ARTICLE I           DEFINITIONS AND INTERPRETATION........................    1
         Section 1.1. Definitions and Interpretation......................    1

ARTICLE II        TRUST INDENTURE ACT                                         4
         Section 2.1.  Trust Indenture Act; Application...................    4
         Section 2.2.  Lists of Holders of Securities.....................    4
         Section 2.3.  Reports by the Preferred Guarantee Trustee.........    5
         Section 2.4.  Periodic Reports to Preferred
          Guarantee Trustee ..............................................    5
         Section 2.5.  Evidence of Compliance with Conditions
          Precedent  .....................................................    5
         Section 2.6.  Events of Default; Waiver..........................    5
         Section 2.7.  Event of Default; Notice...........................    5
         Section 2.8.  Conflicting Interests..............................    6

ARTICLE III         POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE  .............................................    6
         Section 3.1.  Powers and Duties of the Preferred
          Guarantee Trustee...............................................    6
         Section 3.2.  Certain Rights of Preferred Guarantee Trustee......    7
         Section 3.3.  Not Responsible for Recitals or Issuance
          of Guarantee....................................................    9

ARTICLE IV          PREFERRED GUARANTEE TRUSTEE...........................    9
         Section 4.1.  Preferred Guarantee Trustee; Eligibility...........    9
         Section 4.2.  Appointment, Removal and Resignation
          of Preferred Guarantee Trustees ................................    9

ARTICLE V           GUARANTEE.............................................   10
         Section 5.1.  Guarantee..........................................   10
         Section 5.2.  Waiver of Notice and Demand........................   10
         Section 5.3.  Obligations not Affected...........................   11
         Section 5.4.  Rights of Holders..................................   12
         Section 5.5.  Guarantee of Payment...............................   12
         Section 5.6.  Subrogation........................................   12
         Section 5.7.  Independent Obligations............................   12

ARTICLE VI          LIMITATION OF TRANSACTIONS;
SUBORDINATION       ......................................................   12
         Section 6.1.  Limitation of Transactions.........................   12
         Section 6.2  Ranking.............................................   13

ARTICLE VII         TERMINATION...........................................   13
         Section 7.1.  Termination........................................   13

ARTICLE VIII        INDEMNIFICATION.......................................   13
         Section 8.1.  Exculpation........................................   13
         Section 8.2.  Indemnification....................................   14

ARTICLE IX          MISCELLANEOUS.........................................   14
         Section 9.1.  Successors and Assigns.............................   14
         Section 9.2.  Amendments.........................................   14
         Section 9.3.  Notices............................................   14
         Section 9.4.  Benefit............................................   15
         Section 9.5.  Governing Law......................................   15
<PAGE>

                              CROSS REFERENCE TABLE


      Section of Trust                                        Section of
      Indenture Act of                                        Guarantee
      1939, as amended                                        Agreement
      ----------------                                        ---------

      310(a)                                                  4.1(a)
      310(b)                                                  4.1(c), 2.8
      310(c)                                                  Not Applicable
      311(a)                                                  2.2(b)
      311(b)                                                  2.2(b)
      311(c)                                                  Not Applicable
      312(a)                                                  2.2(a)
      312(b)                                                  2.2(b)
      313                                                     2.3
      314(a)                                                  2.4
      314(b)                                                  Not Applicable
      314(c)                                                  2.5
      314(d)                                                  Not Applicable
      314(e)                                                  1.1, 2.5, 3.2
      314(f)                                                  2.1, 3.2
      315(a)                                                  3.1(d)
      315(b)                                                  2.7
      315(c)                                                  3.1
      315(d)                                                  3.1(d)
      316(a)                                                  1.1, 2.6, 5.4
      316(b)                                                  5.3
      317(a)                                                  3.1
      317(b)                                                  Not Applicable
      318(a)                                                  2.1(a)
      318(b)                                                  2.1
      318(c)                                                  2.1(b)

Note: This Cross-Reference Table does not constitute part of this Agreement and
shall not affect the interpretation of any of its terms or provisions.




<PAGE>



                    PREFERRED SECURITIES GUARANTEE AGREEMENT

         THIS  PREFERRED   SECURITIES   GUARANTEE   AGREEMENT  (this  "Preferred
Securities Guarantee"),  dated as of February 4, 1997, is executed and delivered
by FIRST BANKS, INC., a Missouri corporation (the "Guarantor"), and STATE STREET
BANK AND TRUST COMPANY, a trust company organized and existing under the laws of
the  Commonwealth  of  Massachusetts,   as  trustee  (the  "Preferred  Guarantee
Trustee"),  for the benefit of the Holders (as defined herein) from time to time
of the  Preferred  Securities  (as defined  herein) of First  Preferred  Capital
Trust, a Delaware statutory business trust (the "Trust").

                                    RECITALS

         WHEREAS,  pursuant  to an Amended and  Restated  Trust  Agreement  (the
"Trust  Agreement"),  dated as of  February 4, 1997,  among the  trustees of the
Trust named therein, the Guarantor,  as depositor,  and the holders from time to
time of undivided  beneficial interests in the assets of the Trust, the Trust is
issuing on the date hereof 3,450,000 preferred  securities,  having an aggregate
liquidation  amount  of  $86,250,000,  designated  the  9.25%  Cumulative  Trust
Preferred Securities (the "Preferred Securities");

         WHEREAS,  as  incentive  for the  Holders  to  purchase  the  Preferred
Securities,  the Guarantor desires  irrevocably and unconditionally to agree, to
the  extent  set forth in this  Preferred  Securities  Guarantee,  to pay to the
Holders of the Preferred  Securities the Guarantee  Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth herein.

         NOW,  THEREFORE,  in  consideration  of the  purchase by each Holder of
Preferred  Securities,  which purchase the Guarantor hereby agrees shall benefit
the Guarantor,  the Guarantor  executes and delivers this  Preferred  Securities
Guarantee for the benefit of the Holders.


                                    ARTICLE I
                         DEFINITIONS AND INTERPRETATION

Section 1.1.      Definitions and Interpretation

         In this Preferred  Securities  Guarantee,  unless the context otherwise
requires:

         (a) capitalized terms used in this Preferred  Securities  Guarantee but
not defined in the preamble above have the respective  meanings assigned to them
in this Section 1.1;

         (b) terms defined in the Trust Agreement as at the date of execution of
this  Preferred  Securities  Guarantee  have the same  meaning when used in this
Preferred Securities Guarantee;

         (c) a term defined anywhere in this Preferred Securities Guarantee  has
the same meaning throughout;

         (d) all  references to "the  Preferred  Securities  Guarantee" or "this
Preferred  Securities  Guarantee" are to this Preferred  Securities Guarantee as
modified, supplemented or amended from time to time;
<PAGE>

         (e) all  references in this Preferred  Securities Guarantee to Articles
and  Sections  are  to  Articles  and  Sections  of  this  Preferred  Securities
Guarantee, unless otherwise specified;

         (f) a term defined in the Trust Indenture Act has the same meaning when
used in this Preferred  Securities  Guarantee,  unless otherwise defined in this
Preferred Securities Guarantee or unless the context otherwise requires; and

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

          "Affiliate"  has the same meaning as given to that term in Rule 405 of
the Securities Act of 1933, as amended, or any successor rule thereunder.

         "Business Day" means any day other than a day on which federal or state
banking  institutions  in New York,  New York are authorized or required by law,
executive  order or regulation  to close or a day on which the  Corporate  Trust
Office of the Preferred Guarantee Trustee is closed for business.

         "Corporate  Trust Office"  means the office of the Preferred  Guarantee
Trustee at which the corporate trust business of the Preferred Guarantee Trustee
shall, at any particular time, be principally administered,  which office at the
date of execution of this Agreement is located at Two  International  Place, 4th
Floor, Boston, Massachusetts 02110, Attention: Corporate Trust Department.

          "Covered  Person"  means any Holder or  beneficial  owner of Preferred
Securities.

         "Debentures"  means the  9.25%  Subordinated  Debentures  due March 31,
2027, of the Debenture Issuer held by the Property Trustee of the Trust.

         "Debenture Issuer" means the Guarantor.

         "Event of  Default"  means a  default  by the  Guarantor  on any of its
payment or other obligations under this Preferred Securities Guarantee.

         "Guarantor" means First Banks, Inc., a Missouri corporation.

         "Guarantee  Payments"  means the following  payments or  distributions,
without duplication, with respect to the Preferred Securities, to the extent not
paid or made by the Trust: (i) any accrued and unpaid  Distributions (as defined
in the  Trust  Agreement)  that  are  required  to be  paid  on  such  Preferred
Securities,  to the extent the Trust shall have funds available  therefor,  (ii)
the redemption price, including all accrued and unpaid Distributions to the date
of  redemption  (the  "Redemption  Price"),  to the  extent  the Trust has funds
available  therefor,  with  respect  to  any  Preferred  Securities  called  for
redemption by the Trust, and (iii) upon a voluntary or involuntary  dissolution,
winding-up  or  termination  of the Trust  (other  than in  connection  with the
distribution  of Debentures to the Holders in exchange for Preferred  Securities
as  provided in the Trust  Agreement),  the lesser of (a) the  aggregate  of the
liquidation  amount and all accrued and unpaid  Distributions  on the  Preferred
Securities  to the date of  payment,  to the extent  the Trust  shall have funds
available  therefor  (the  "Liquidation  Distribution"),  and (b) the  amount of
assets  of  the  Trust  remaining  available  for  distribution  to  Holders  in
liquidation of the Trust.
<PAGE>

         "Holder" shall mean any holder,  as registered on the books and records
of  the  Trust,  of  any  Preferred  Securities;  provided,  however,  that,  in
determining  whether  the  holders  of the  requisite  percentage  of  Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the Guarantor.

         "Indemnified   Person"  means  the  Preferred  Guarantee  Trustee,  any
Affiliate  of the  Preferred  Guarantee  Trustee,  or any  officers,  directors,
shareholders,   members,   partners,   employees,   representatives,   nominees,
custodians or agents of the Preferred Guarantee Trustee.

         "Indenture" means the Indenture dated as of February 4, 1997, among the
Debenture  Issuer and State Street Bank and Trust Company,  as trustee,  and any
indenture  supplemental  thereto  pursuant to which  certain  subordinated  debt
securities of the Debenture  Issuer are to be issued to the Property  Trustee of
the Trust.

          "Liquidation  Distribution"  has the meaning provided  therefor in the
definition of Guarantee Payments.

         "Majority in liquidation amount of the Preferred  Securities" means the
holders of more than 50% of the 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 of the Preferred Securities.

         "Officers'   Certificate"   means,   with  respect  to  any  Person,  a
certificate  signed by two  authorized  officers of such Person.  Any  Officers'
Certificate  delivered  with respect to compliance  with a condition or covenant
provided for in this Preferred Securities Guarantee shall include:

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

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

         "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.

         "Preferred  Guarantee  Trustee"  means  State  Street  Bank  and  Trust
Company,  until a Successor  Preferred  Guarantee Trustee has been appointed and

<PAGE>

has accepted such appointment pursuant to the terms of this Preferred Securities
Guarantee and thereafter means each such Successor Preferred Guarantee Trustee.

          "Redemption Price" has the meaning provided therefor in the definition
of Guarantee Payments.

         "Responsible  Officer" means,  with respect to the Preferred  Guarantee
Trustee,  any  officer  within  the  Corporate  Trust  Office  of the  Preferred
Guarantee Trustee,  including any vice-president,  any assistant vice-president,
any assistant secretary, the treasurer, any assistant treasurer or other officer
of the Corporate  Trust Office of the Preferred  Guarantee  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.

         "Successor  Preferred  Guarantee  Trustee" means a successor  Preferred
Guarantee Trustee  possessing the  qualifications to act as Preferred  Guarantee
Trustee under Section 4.1.

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


                                   ARTICLE II
                               TRUST INDENTURE ACT

Section 2.1.  Trust Indenture Act; Application.

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

         (b)  If  and to  the  extent  that  any  provision  of  this  Preferred
Securities  Guarantee limits,  qualifies or conflicts with the duties imposed by
Section 310 to 317,  inclusive,  of the Trust Indenture Act, such imposed duties
shall control.

Section 2.2.  Lists of Holders of Securities.

         (a) In the  event  the  Preferred  Guarantee  Trustee  is not  also the
Transfer Agent, the Guarantor shall provide the Preferred Guarantee Trustee with
a list, in such form as the Preferred  Guarantee Trustee may reasonably require,
of the names and addresses of the Holders of the Preferred  Securities ("List of
Holders") as of such date, (i) within 1 Business Day after January 1 and June 30
of each  year,  and (ii) at any  other  time  within 30 days of  receipt  by the
Guarantor  of a written  request for a List of Holders as of a date no more than
15 days before such List of Holders is given to the Preferred Guarantee Trustee;
provided,  that the  Guarantor  shall not be  obligated  to provide such List of
Holders at any time the List of Holders  does not  differ  from the most  recent
List of Holders given to the Preferred  Guarantee Trustee by the Guarantor.  The
Preferred  Guarantee Trustee may destroy any List of Holders previously given to
it on receipt of a new List of Holders.
<PAGE>

         (b) The Preferred  Guarantee  Trustee shall comply with its obligations
under Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.
Section 2.3.  Reports by the Preferred Guarantee.

         On or before  July 15 of each year,  the  Preferred  Guarantee  Trustee
shall  provide to the Holders of the  Preferred  Securities  such reports as are
required by Section 313 of the Trust  Indenture  Act, if any, in the form and in
the manner  provided by Section 313 of the Trust  Indenture  Act. The  Preferred
Guarantee  Trustee shall also comply with the  requirements of Section 313(d) of
the Trust Indenture Act.

Section 2.4.  Periodic Reports to Preferred Guarantee Trustee.

         The Guarantor  shall provide to the  Preferred  Guarantee  Trustee such
documents,  reports and  information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust Indenture Act in the
form,  in the  manner  and at the times  required  by  Section  314 of the Trust
Indenture Act.

Section 2.5.  Evidence of Compliance with Conditions Precedent.

         The Guarantor  shall provide to the  Preferred  Guarantee  Trustee such
evidence of compliance with any conditions  precedent,  if any,  provided for in
this Preferred  Securities Guarantee that relate to any of the matters set forth
in  Section  314(c) of the Trust  Indenture  Act.  Any  certificate  or  opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.

Section 2.6.  Events of Default; Waiver.

         The Holders of a Majority in liquidation amount of Preferred Securities
may, by vote, on behalf of the Holders of all of the Preferred Securities, waive
any past Event of Default and its consequences. Upon such waiver, any such Event
of Default  shall  cease to exist,  and any Event of Default  arising  therefrom
shall be  deemed  to have  been  cured,  for  every  purpose  of this  Preferred
Securities Guarantee, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.

Section 2.7.  Event of Default; Notice.

         (a) The Preferred  Guarantee  Trustee  shall,  within 90 days after the
occurrence  of an Event  of  Default,  transmit  by mail,  first  class  postage
prepaid,  to the Holders of the Preferred  Securities,  notices of all Events of
Default  actually  known to a  Responsible  Officer of the  Preferred  Guarantee
Trustee,  unless such defaults have been cured before the giving of such notice;
provided, that the Preferred Guarantee Trustee shall be protected in withholding
such notice if and so long as a Responsible  Officer of the Preferred  Guarantee
Trustee in good faith  determines  that the withholding of such notice is in the
interests of the Holders of the Preferred Securities.

         (b)  The  Preferred  Guarantee  Trustee  shall  not be  deemed  to have
knowledge of any Event of Default unless the Preferred  Guarantee  Trustee shall
have received written notice, or of which a Responsible Officer of the Preferred
Guarantee  Trustee charged with the  administration of the Trust Agreement shall
have obtained actual knowledge.

<PAGE>



Section 2.8.  Conflicting Interests.

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


                                   ARTICLE III
            POWERS, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE

Section 3.1.  Powers and Duties of the Preferred Guarantee.

         (a) This Preferred  Securities Guarantee shall be held by the Preferred
Guarantee  Trustee for the benefit of the Holders of the  Preferred  Securities,
and the Preferred Guarantee Trustee shall not transfer this Preferred Securities
Guarantee to any Person except a Holder of Preferred  Securities  exercising his
or her rights pursuant to Section 5.4(b) or to a Successor  Preferred  Guarantee
Trustee on  acceptance  by such  Successor  Preferred  Guarantee  Trustee of its
appointment to act as Successor  Preferred  Guarantee Trustee.  The right, title
and interest of the Preferred  Guarantee Trustee shall automatically vest in any
Successor Preferred  Guarantee Trustee,  and such vesting and cessation of title
shall be effective whether or not conveyancing  documents have been executed and
delivered  pursuant to the  appointment  of such Successor  Preferred  Guarantee
Trustee.

         (b) If an Event of Default  actually known to a Responsible  Officer of
the Preferred  Guarantee  Trustee has occurred and is continuing,  the Preferred
Guarantee  Trustee shall  enforce this  Preferred  Securities  Guarantee for the
benefit of the Holders of the Preferred Securities.

         (c) The Preferred Guarantee Trustee, before the occurrence of any Event
of Default and after the curing of all Events of Default that may have occurred,
shall  undertake  to perform only such duties as are  specifically  set forth in
this Preferred Securities Guarantee, and no implied covenants shall be read into
this Preferred  Securities Guarantee against the Preferred Guarantee Trustee. In
case an Event of  Default  has  occurred  (that  has not  been  cured or  waived
pursuant to Section 2.6) and is actually  known to a Responsible  Officer of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall exercise such
of the rights and powers vested in it by this  Preferred  Securities  Guarantee,
and use the same degree of care and skill in its exercise thereof,  as a prudent
person would  exercise or use under the  circumstances  in the conduct of his or
her own affairs.

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

                  (i) prior to the  occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have occurred:
<PAGE>

                           (A) the  duties  and  obligations  of the   Preferred
Guarantee  Trustee  shall be determined  solely  by the  express  provisions  of
this  Preferred   Securities Guarantee,  and  the  Preferred  Guarantee  Trustee
shall not be liable except for the performance of such duties and obligations as
are  specifically  set  forth in  this Preferred  Securities  Guarantee,  and no
implied  covenants or obligations shall be read into this  Preferred  Securities
Guarantee  against the Preferred Guarantee Trustee; and
                           (B) in  the  absence  of bad faith on the part of the
Preferred  Guarantee  Trustee,the Preferred  Guarantee  Trustee may conclusively
rely, as to the truth of the statements  and  the  correctness  of the  opinions
expressed   therein,  upon  any  certificates   or   opinions  furnished  to the
Preferred Guarantee Trustee and conforming to the requirements of this Preferred
Securities  Guarantee;  but in the case of any  such  certificates  or  opinions
that by any provision  hereof are specifically  required to be furnished  to the
Preferred  Guarantee Trustee,  the Preferred  Guarantee  Trustee shall  be under
a  duty to  examine  the  same to determine  whether or not they  conform to the
requirements  of this  Preferred Securities Guarantee;

                  (ii) the Preferred  Guarantee  Trustee shall not be liable for
any  error of  judgment  made in good  faith  by a  Responsible  Officer  of the
Preferred  Guarantee  Trustee,  unless  it shall be  proved  that the  Preferred
Guarantee  Trustee was negligent in ascertaining  the pertinent facts upon which
such judgment was made;

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

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

Section 3.2.  Certain Rights of Preferred Guarantee Trustee.

         (a)      Subject to the provisions of Section 3.1:

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

                  (ii) any  direction  or  act  of the Guarantor contemplated by
this  Preferred  Securities  Guarantee  shall  be  sufficiently  evidenced by an
Officers' Certificate;
<PAGE>

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

                  (iv)   the Preferred  Guarantee  Trustee shall have no duty to
see  to  any  recording,  filing  or registration  of  any  instrument  (or  any
rerecording, refiling or registration thereof);

                  (v) the Preferred  Guarantee Trustee may consult with counsel,
and the written  advice or opinion of such counsel with respect to legal matters
shall be full and complete authorization and protection in respect of any action
taken,  suffered or omitted by it hereunder in good faith and in accordance with
such advice or opinion.  Such counsel may be counsel to the  Guarantor or any of
its  Affiliates and may include any of its  employees.  The Preferred  Guarantee
Trustee  shall have the right at any time to seek  instructions  concerning  the
administration  of  this  Preferred  Securities  Guarantee  from  any  court  of
competent jurisdiction;

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

                  (vii) the  Preferred  Guarantee  Trustee shall not be bound to
make any  investigation  into the facts or  matters  stated  in any  resolution,
certificate, statement, instrument, opinion, report, notice, request, direction,
consent,  order, bond, debenture,  note, other evidence of indebtedness or other
paper or document,  but the Preferred Guarantee Trustee, in its discretion,  may
make such further inquiry or investigation  into such facts or matters as it may
see fit;

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

                  (ix) any action taken by the  Preferred  Guarantee  Trustee or
its agents hereunder shall bind the Holders of the Preferred Securities, and the
signature  of the  Preferred  Guarantee  Trustee  or its agents  alone  shall be
sufficient  and  effective to perform any such  action.  No third party shall be
required to inquire as to the authority of the Preferred Guarantee Trustee to so
act or as to its  compliance  with  any of the  terms  and  provisions  of  this

<PAGE>

Preferred Securities Guarantee, both of which shall be conclusively evidenced by
the Preferred Guarantee Trustee's or its agent's taking such action;

                  (x)  whenever  in  the   administration   of  this   Preferred
Securities  Guarantee the Preferred Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or taking any
other  action  hereunder,  the  Preferred  Guarantee  Trustee  (i)  may  request
instructions  from the  Holders  of a  Majority  in  liquidation  amount  of the
Preferred  Securities,  (ii) may refrain from  enforcing such remedy or right or
taking such other action until such  instructions are received,  and (iii) shall
be  protected  in  conclusively  relying  on or acting in  accordance  with such
instructions.

         (b) No provision of this Preferred Securities Guarantee shall be deemed
to impose any duty or obligation on the Preferred  Guarantee  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
Preferred  Guarantee  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 Preferred Guarantee Trustee shall be construed to be a duty.

Section 3.3.  Not Responsible for Recitals or Issuance of Guarantee.

         The  Recitals  contained  in  this  Guarantee  shall  be  taken  as the
statements of the Guarantor, and the Preferred Guarantee Trustee does not assume
any responsibility for their correctness.  The Preferred Guarantee Trustee makes
no representation as to the validity or sufficiency of this Preferred Securities
Guarantee.


                                   ARTICLE IV
                           PREFERRED GUARANTEE TRUSTEE

Section 4.1.  Preferred Guarantee Trustee; Eligibility.

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

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

                  (ii) be a corporation  organized and doing  business under the
laws of the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the Securities and
Exchange Commission to act as an institutional trustee under the Trust Indenture
Act,  authorized  under such laws to exercise  corporate trust powers,  having a
combined capital and surplus of at least $50,000,000, and subject to supervision
or examination by Federal, State, Territorial or District of Columbia authority.
If such corporation  publishes reports of condition at least annually,  pursuant
to law or to the requirements of the supervising or examining authority referred
to above,  then,  for the  purposes of this  Section  4.1(a)(ii),  the  combined
capital  and  surplus  of such  corporation  shall be deemed to be its  combined
capital  and  surplus as set forth in its most  recent  report of  condition  so
published.
<PAGE>

         (b) If at any time the  Preferred  Guarantee  Trustee shall cease to be
eligible to so act under Section 4.1(a),  the Preferred  Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2(c).

         (c)  If the  Preferred  Guarantee  Trustee  has or  shall  acquire  any
"conflicting  interest"  within  the  meaning  of  Section  310(b)  of the Trust
Indenture  Act,  the  Preferred  Guarantee  Trustee and  Guarantor  shall in all
respects  comply with the  provisions of Section  310(b) of the Trust  Indenture
Act.


Section 4.2.  Appointment,  Removal  and  Resignation  of  Preferred   Guarantee
Trustees.

         (a)      Subject to Section 4.2(b),  the Preferred  Guarantee  Trustee
may be appointed or removed without cause at any time by the Guarantor.

         (b) The Preferred  Guarantee Trustee shall not be removed in accordance
with  Section  4.2(a)  until a Successor  Preferred  Guarantee  Trustee has been
appointed and has accepted such  appointment by written  instrument  executed by
such Successor Preferred Guarantee Trustee and delivered to the Guarantor.

         (c) The  Preferred  Guarantee  Trustee  appointed  to office shall hold
office until a Successor  Preferred  Guarantee Trustee shall have been appointed
or until its removal or resignation.  The Preferred Guarantee Trustee may resign
from office  (without need for prior or subsequent  accounting) by an instrument
in writing  executed by the  Preferred  Guarantee  Trustee and  delivered to the
Guarantor,  which resignation shall not take effect until a Successor  Preferred
Guarantee  Trustee has been  appointed  and has  accepted  such  appointment  by
instrument in writing executed by such Successor Preferred Guarantee Trustee and
delivered to the Guarantor and the resigning Preferred Guarantee Trustee.

         (d)  If no  Successor  Preferred  Guarantee  Trustee  shall  have  been
appointed  and  accepted  appointment  as provided in this Section 4.2 within 60
days after  delivery to the  Guarantor  of an  instrument  of  resignation,  the
resigning  Preferred  Guarantee  Trustee  may  petition  any court of  competent
jurisdiction for appointment of a Successor  Preferred  Guarantee Trustee.  Such
court may  thereupon,  after  prescribing  such  notice,  if any, as it may deem
proper, appoint a Successor Preferred Guarantee Trustee.

          (e) No  Preferred  Guarantee  Trustee  shall be liable for the acts or
omissions to act of any Successor Preferred Guarantee Trustee.

         (f) Upon termination of this Preferred  Securities Guarantee or removal
or resignation of the Preferred  Guarantee Trustee pursuant to this Section 4.2,
the Guarantor shall pay to the Preferred  Guarantee  Trustee all amounts accrued
to the date of such termination, removal or resignation.

                                    ARTICLE V
                                    GUARANTEE

Section 5.1.  Guarantee.

         The Guarantor irrevocably and unconditionally  agrees to pay in full to
the Holders the Guarantee Payments (without  duplication of amounts  theretofore

<PAGE>

paid by the Trust), as and when due, regardless of any defense, right of set-off
or counterclaim that the Trust may have or assert. The Guarantor's obligation to
make a Guarantee  Payment may be  satisfied  by direct  payment of the  required
amounts by the  Guarantor  to the  Holders  or by causing  the Trust to pay such
amounts to the Holders.

Section 5.2.  Waiver of Notice and Demand.

         The Guarantor  hereby  waives  notice of  acceptance of this  Preferred
Securities  Guarantee  and of any  liability  to which it  applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Trust or any other Person before proceeding against the Guarantor,  protest,
notice of  nonpayment,  notice of dishonor,  notice of redemption  and all other
notices and demands.

Section 5.3.  Obligations not Affected.

         The  obligations,  covenants,  agreements  and duties of the  Guarantor
under  this  Preferred  Securities  Guarantee  shall  in no way be  affected  or
impaired by reason of the happening from time to time of any of the following:

         (a) the release or waiver,  by  operation of law or  otherwise,  of the
performance  or  observance  by the Trust of any  express or implied  agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Trust;

         (b) the  extension  of time for the  payment by the Trust of all or any
portion of the Distributions,  Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Preferred  Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the Preferred  Securities  (other than an extension of time for
payment of Distributions,  Redemption Price,  Liquidation  Distribution or other
sum payable that results from the  extension of any interest  payment  period on
the Debentures or any extension of the maturity date of the Debentures permitted
by the Indenture);

         (c) any  failure,  omission,  delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Preferred  Securities,  or
any action on the part of the Trust  granting  indulgence  or  extension  of any
kind;

         (d) the voluntary or involuntary liquidation,  dissolution, sale of any
collateral, receivership,  insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization,  arrangement, composition or readjustment of debt of,
or other similar  proceedings  affecting,  the Trust or any of the assets of the
Trust;

         (e) any  invalidity  of,  or  defect  or  deficiency  in, the Preferred
Securities;

         (f) any  failure or  omission  to receive  any  regulatory  approval or
consent  required in  connection  with the Preferred  Securities  (or the common
equity  securities  issued by the Trust),  including  the failure to receive any
approval of the Board of Governors of the Federal  Reserve  System  required for
the redemption of the Preferred Securities;
<PAGE>

         (g) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or

         (h) any other circumstance whatsoever that might otherwise constitute a
legal or equitable  discharge or defense of a guarantor,  it being the intent of
this  Section  5.3 that the  obligations  of the  Guarantor  hereunder  shall be
absolute and unconditional under any and all circumstances.

         There  shall be no  obligation  of the  Holders  to give  notice to, or
obtain  consent of, the  Guarantor  with respect to the  happening of any of the
foregoing.


Section 5.4.  Rights of Holders.

         (a) The Holders of a Majority in  liquidation  amount of the  Preferred
Securities have the right to direct the time,  method and place of conducting of
any proceeding for any remedy  available to the Preferred  Guarantee  Trustee in
respect of this Preferred  Securities Guarantee or exercising any trust or power
conferred upon the Preferred  Guarantee Trustee under this Preferred  Securities
Guarantee.

         (b) Any Holder of Preferred Securities may institute a legal proceeding
directly  against  the  Guarantor  to enforce  its rights  under this  Preferred
Securities  Guarantee,  without first instituting a legal proceeding against the
Trust, the Preferred Guarantee Trustee or any other Person.

Section 5.5.  Guarantee of Payment.

         This Preferred  Securities Guarantee creates a guarantee of payment and
not of collection.

Section 5.6.  Subrogation.

         The Guarantor shall be subrogated to all (if any) rights of the Holders
of Preferred Securities against the Trust in respect of any amounts paid to such
Holders by the Guarantor under this Preferred  Securities  Guarantee;  provided,
however,  that the  Guarantor  shall  not  (except  to the  extent  required  by
mandatory  provisions  of law) be entitled to enforce or exercise any right that
it may acquire by way of subrogation or any  indemnity,  reimbursement  or other
agreement,  in all cases as a result of payment under this Preferred  Securities
Guarantee,  if, at the time of any such payment,  any amounts are due and unpaid
under this Preferred  Securities  Guarantee.  If any amount shall be paid to the
Guarantor in violation of the preceding  sentence,  the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the Holders.

Section 5.7.  Independent Obligations.

         The  Guarantor   acknowledges   that  its  obligations   hereunder  are
independent  of the  obligations  of the Trust  with  respect  to the  Preferred
Securities,  and that the  Guarantor  shall be liable as principal and as debtor
hereunder to make  Guarantee  Payments  pursuant to the terms of this  Preferred
Securities Guarantee  notwithstanding the occurrence of any event referred to in
subsections (a) through (h), inclusive, of Section 5.3 hereof.
<PAGE>


                                   ARTICLE VI
                    LIMITATION OF TRANSACTIONS; SUBORDINATION

Section 6.1.  Limitation of Transactions.

         So long as any Preferred Securities remain outstanding,  if there shall
have occurred an Event of Default under this Preferred Securities Guarantee,  an
Event of  Default  under the Trust  Agreement  or  during an  Extended  Interest
Payment Period (as defined in the  Indenture),  then (a) the Guarantor shall not
declare or pay any  dividend  on,  make any  distributions  with  respect to, or
redeem, purchase,  acquire or make a liquidation payment with respect to, any of
its  capital  stock  (other  than (i) as a result of a  reclassification  of its
capital stock for another class of its capital stock,  or (ii) the conversion of
the  Guarantor's  Class A Convertible,  Adjustable  Rate Preferred  Stock to the
Guarantor's  common  stock,  par value  $250.00 per share) and (b) the Guarantor
shall not make any payment of interest or principal on or repay,  repurchase  or
redeem any debt securities issued by the Guarantor which rank pari passu with or
junior to the Debentures.

Section 6.2  Ranking.

         This  Preferred  Securities  Guarantee  will  constitute  an  unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all other liabilities of the Guarantor, (ii) pari passu with the most
senior  preferred  securities or preference stock now or hereafter issued by the
Guarantor and with any guarantee now or hereafter  entered into by the Guarantor
in respect of any preferred  securities or preference  stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.


                                   ARTICLE VII
                                   TERMINATION

Section 7.1.  Termination.

         This  Preferred  Securities  Guarantee  shall  terminate  upon (i) full
payment of the  Redemption  Price of all  Preferred  Securities,  (ii) upon full
payment of the  amounts  payable in  accordance  with the Trust  Agreement  upon
liquidation of the Trust,  or (iii) upon  distribution  of the Debentures to the
Holders  of  the  Preferred  Securities.  Notwithstanding  the  foregoing,  this
Preferred  Securities  Guarantee  shall  continue  to be  effective  or shall be
reinstated,  as the  case  may  be,  if at any  time  any  Holder  of  Preferred
Securities must restore payment of any sums paid under the Preferred  Securities
or under this Preferred Securities Guarantee.


                                  ARTICLE VIII
                                 INDEMNIFICATION

Section 8.1.  Exculpation.

         (a) No Indemnified  Person shall be liable,  responsible or accountable
in damages or  otherwise to the  Guarantor  or any Covered  Person for any loss,

<PAGE>

damage or claim  incurred by reason of any act or omission  performed or omitted
by such  Indemnified  Person in good  faith in  accordance  with this  Preferred
Securities  Guarantee and in a manner that such  Indemnified  Person  reasonably
believed to be within the scope of the authority  conferred on such  Indemnified
Person  by  this  Preferred  Securities  Guarantee  or by  law,  except  that an
Indemnified  Person shall be liable for any such loss,  damage or claim incurred
by reason of such  Indemnified  Person's  negligence or willful  misconduct with
respect to such acts or omissions.

         (b) An Indemnified  Person shall be fully  protected in relying in good
faith upon the records of the  Guarantor  and upon such  information,  opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified   Person   reasonably   believes  are  within  such  other  Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor,  including information,  opinions,  reports or
statements  as to the value  and  amount of the  assets,  liabilities,  profits,
losses,  or any other facts pertinent to the existence and amount of assets from
which  Distributions to Holders of Preferred  Securities might properly be paid.
Section 8.2. Indemnification.

         The Guarantor agrees to indemnify each  Indemnified  Person for, and to
hold each Indemnified  Person harmless against,  any loss,  liability or expense
incurred  without  negligence  or bad  faith on its part,  arising  out of or in
connection  with  the  acceptance  or  administration  of the  trust  or  trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against, or investigating,  any claim or liability
in connection  with the exercise or  performance  of any of its powers or duties
hereunder.  The  obligation  to indemnify as set forth in this Section 8.2 shall
survive the termination of this Preferred Securities Guarantee.


                                   ARTICLE IX
                                  MISCELLANEOUS

Section 9.1.  Successors and Assigns.

         All guarantees and  agreements  contained in this Preferred  Securities
Guarantee  shall  bind  the  successors,   assigns,   receivers,   trustees  and
representatives  of the  Guarantor and shall inure to the benefit of the Holders
of the Preferred Securities then outstanding.

Section 9.2.  Amendments.

         Except with  respect to any changes  that do not  materially  adversely
affect  the rights of  Holders  (in which  case no  consent  of Holders  will be
required),  this  Preferred  Securities  Guarantee  may only be amended with the
prior  approval of the Holders of at least a Majority in  liquidation  amount of
the Preferred  Securities.  The provisions of Article VI of the Trust  Agreement
with  respect to meetings of Holders of the  Preferred  Securities  apply to the
giving of such approval.
<PAGE>

Section 9.3.  Notices.

         All notices provided for in this Preferred  Securities  Guarantee shall
be in  writing,  duly  signed  by the party  giving  such  notice,  and shall be
delivered, telecopied or mailed by registered or certified mail, as follows:

         (a) If given  to the  Preferred  Guarantee  Trustee,  at the  Preferred
Guarantee  Trustee's  mailing  address set forth below (or such other address as
the  Preferred  Guarantee  Trustee  may give  notice  of to the  Holders  of the
Preferred Securities):

                           State Street Bank and Trust Company
                           Two International Place, 4th Floor
                           Boston, Massachusetts  02110
                           Attention:  Corporate Trust Department

         (b) If given to the Guarantor,  at the Guarantor's  mailing address set
forth below (or such other  address as the  Guarantor  may give notice of to the
Holders of the Preferred Securities):

                           First Banks, Inc.
                           135 North Meramec Avenue
                           St. Louis, Missouri 63105
                           Attention:       Mr. James F. Dierberg
                                            Chairman, President and
                                            Chief Executive Officer
         (c) If given to any  Holder of  Preferred  Securities,  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 9.4.  Benefit.

         This  Preferred  Securities  Guarantee is solely for the benefit of the
Holders of the  Preferred  Securities  and,  subject to Section  3.1(a),  is not
separately transferable from the Preferred Securities.
<PAGE>

Section 9.5.  Governing Law.

         THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF MISSOURI.

         This Preferred  Securities Guarantee is executed as of the day and year
first above written.

                                        FIRST BANKS, INC.,
                                        as Guarantor


                                        By:  /s/ Allen H. Blake
                                        Name: Allen H. Blake
                                        Title: Executive Vice President,
                                        Chief Financial Officer and Secretary


                                        STATE STREET BANK AND TRUST COMPANY,
                                        as Preferred Guarantee Trustee


                                        By: /s/ Paul D. Allen
                                        Name: Paul D. Allen
                                        Title: Vice President


<PAGE>


                                                                Exhibit 4(c)



                                FIRST BANKS, INC.



                                       AND


                      STATE STREET BANK AND TRUST COMPANY,
                                   AS TRUSTEE



                                    INDENTURE


                     9.25% SUBORDINATED DEBENTURES DUE 2027

                          Dated as of February 4, 1997.










<PAGE>


                                TABLE OF CONTENTS

                                                                         Page

ARTICLE I.   DEFINITIONS...............................................     1
      Section 1.1. Definitions of Terms ...............................     1

ARTICLE II.  ISSUE, DESCRIPTION, TERMS, CONDITIONS
REGISTRATION AND EXCHANGE OF THE DEBENTURES............................     8
      Section 2.1. Designation and Principal Amount ...................     8
      Section 2.2. Maturity ...........................................     8
      Section 2.3. Form and Payment ...................................     9
      Section 2.4.[Intentionally Omitted]
      Section 2.5. Interest ...........................................     9
      Section 2.6. Execution and Authentications.......................    10
      Section 2.7. Registration of Transfer and Exchange...............    11
      Section 2.8. Temporary Debentures ...............................    12
      Section 2.9. Mutilated, Destroyed,
         Lost or Stolen Debentures.....................................    12
      Section 2.10. Cancellation.......................................    13
      Section 2.11. Benefit of Indenture...............................    13
      Section 2.12. Authentication Agent...............................    13

ARTICLE III. REDEMPTION OF DEBENTURES                                      14
      Section 3.1. Redemption .........................................    14
      Section 3.2. Special Event Redemption ...........................    14
      Section 3.3. Optional Redemption by Company .....................    14
      Section 3.4. Notice of Redemption ...............................    15
      Section 3.5. Payment Upon Redemption.............................    16
      Section 3.6. No Sinking Fund.....................................    16

ARTICLE IV.        EXTENSION OF INTEREST PAYMENT PERIOD................    16
      Section 4.1. Extension of Interest Payment Period ...............    16
      Section 4.2. Notice of Extension.................................    17
      Section 4.3. Limitation on Transactions .........................    17

ARTICLE V.         PARTICULAR COVENANTS OF THE COMPANY.................    18
      Section 5.1. Payment of Principal and Interest...................    18
      Section 5.2. Maintenance of Agency...............................    18
      Section 5.3. Paying Agents.......................................    18
      Section 5.4. Appointment to Fill Vacancy in
       Office of Trustee...............................................    19
      Section 5.5. Compliance with Consolidation Provisions............    19
      Section 5.6. Limitation on Transactions .........................    19
      Section 5.7. Covenants as to the Trust...........................    20
      Section 5.8. Covenants as to Purchases...........................    20

ARTICLE VI.       DEBENTUREHOLDERS' LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE ........................................    20
      Section 6.1.Company to Furnish Trustee Names and
         Addresses of Debentureholders ................................    20
      Section 6.2.Preservation of Information Communications
         with Debentureholders ........................................    21
      Section 6.3.Reports by the Company ..............................    21
      Section 6.4.Reports by the Trustee...............................    21

ARTICLE VII. REMEDIES OF THE TRUSTEE AND
DEBENTUREHOLDERS ON EVENT OF DEFAULT ..................................    22
      Section 7.1.Events of Default....................................    22
      Section 7.2.Collection of Indebtedness and Suits for
         Enforcement by Trustee .......................................    23
      Section 7.3.Application of Moneys Collected......................    24
      Section 7.4.Limitation on Suits..................................    25

<PAGE>

      Section 7.5.Rights and Remedies Cumulative; Delay or
         Omission not Waiver ..........................................    25
      Section 7.6.Control by Debentureholders..........................    26
      Section 7.7.Undertaking to Pay Costs.............................    26

ARTICLE VIII.FORM OF DEBENTURE AND ORIGINAL ISSUE......................    27
      Section 8.1.Form of Debenture....................................    27
      Section 8.2.Original Issue of Debentures.........................    27

ARTICLE IX.       CONCERNING THE TRUSTEE...............................    27
      Section 9.1.Certain Duties and Responsibilities Trustee..........    27
      Section 9.2.Notice of Defaults...................................    28
      Section 9.3.Certain Rights of Trustee............................    28
      Section 9.4.Trustee Not Responsible for Recitals, etc. ..........    29
      Section 9.5.May Hold Debentures..................................    30
      Section 9.6.Moneys Held in Trust.................................    30
      Section 9.7.Compensation and Reimbursement.......................    30
      Section 9.8.Reliance on Officers' Certificate....................    31
      Section 9.9.Disqualification:  Conflicting Interests.............    31
      Section 9.10.Corporate Trustee Required; Eligibility.............    31
      Section 9.11.Resignation and Removal;
         Appointment of Successor .....................................    31
      Section 9.12.Acceptance of Appointment by Successor..............    32
      Section 9.13.Merger, Conversion, Consolidation
         or Succession to Business ....................................    33
      Section 9.14.Preferential Collection of
         Claims Against the Company ...................................    33

ARTICLE X.        CONCERNING THE DEBENTUREHOLDERS......................    33
      Section 10.1.Evidence of Action by Holders.......................    33
      Section 10.2.Proof of Execution by Debentureholders..............    34
      Section 10.3.Who May be Deemed Owners............................    34
      Section 10.4.Certain Debentures Owned
         by Company Disregarded........................................    34
      Section 10.5.Actions Binding on Future Debentureholders..........    35

ARTICLE XI.       SUPPLEMENTAL INDENTURES..............................    35
      Section 11.1.Supplemental Indentures Without the
       Consent of Debentureholders ....................................    35
      Section 11.2.Supplemental Indentures with
        Consent of Debentureholders ...................................    36
      Section 11.3.Effect of Supplemental Indentures...................    36
      Section 11.4.Debentures Affected by Supplemental
       Indentures......................................................    37
      Section 11.5.Execution of Supplemental Indentures................    37

ARTICLE XII.SUCCESSOR CORPORATION......................................    37
      Section 12.1.Company May Consolidate, etc. ......................    37
      Section 12.2.Successor Corporation Substituted ..................    38
      Section 12.3.Evidence of Consolidation, etc. to Trustee..........    38

ARTICLE XIII.SATISFACTION AND DISCHARGE................................    38
      Section 13.1.Satisfaction and Discharge of Indenture ............    38
      Section 13.2.Discharge of Obligations............................    39
      Section 13.3.Deposited Moneys to be Held in Trust................    39
      Section 13.4.Payment of Monies Held by Paying Agents ............    39
      Section 13.5.Repayment to Company................................    40

ARTICLE XIV.IMMUNITY OF INCORPORATORS,
STOCKHOLDERS, OFFICERS AND DIRECTORS ..................................    40
      Section 14.1.No Recourse ........................................    40

<PAGE>

ARTICLE XV.       MISCELLANEOUS PROVISIONS.............................    40
      Section 15.1.Effect on Successors and Assigns....................    40
      Section 15.2.Actions by Successor................................    41
      Section 15.3.Surrender of Company Powers.........................    41
      Section 15.4.Notices.............................................    41
      Section 15.5.Governing Law.......................................    41
      Section 15.6.Treatment of Debentures as Debt.....................    41
      Section 15.7.Compliance Certificates and Opinions................    41
      Section 15.8.Payments on Business Days...........................    42
      Section 15.9.Conflict with Trust Indenture Act...................    42
      Section 15.10.Counterparts.......................................    42
      Section 15.11.Separability ......................................    42
      Section 15.12.Assignment.........................................    42
      Section 15.13.Acknowledgment of Rights...........................    42

ARTICLE XVI.SUBORDINATION OF DEBENTURES................................    43
      Section 16.1.Agreement to Subordinate............................    43
      Section 16.2.Default on Senior Debt, Subordinated Debt or
         Additional Senior Obligations ................................    43
      Section 16.3.Liquidation; Dissolution; Bankruptcy................    43
      Section 16.4.Subrogation.........................................    44
      Section 16.5.Trustee to Effectuate Subordination.................    45
      Section 16.6.Notice by the Company...............................    45
      Section 16.7.Rights of the Trustee; Holders of
       Senior Indebtedness ............................................    46
      Section 16.8.Subordination may not be Impaired ..................    47



<PAGE>





                                   Exhibit A-6

                                    INDENTURE

         INDENTURE,  dated as of February 4, 1997,  between FIRST BANKS, INC., a
Missouri  corporation (the "Company") and STATE STREET BANK AND TRUST COMPANY, a
trust company duly organized and existing under the laws of the  Commonwealth of
Massachusetts, as trustee (the "Trustee");

                                    RECITALS

         WHEREAS,  for its  lawful  corporate  purposes,  the  Company  has duly
authorized  the  execution  and  delivery of this  Indenture  to provide for the
issuance of securities to be known as its 9.25% Subordinated Debentures due 2027
(hereinafter  referred to as the  "Debentures"),  the form and substance of such
Debentures and the terms,  provisions and conditions  thereof to be set forth as
provided in this Indenture;

         WHEREAS,  First Preferred Capital Trust, a Delaware  statutory business
trust (the "Trust"),  has offered to the public  $86,250,000  million  aggregate
liquidation amount of its Preferred  Securities (as defined herein) and proposes
to invest the proceeds  from such  offering,  together  with the proceeds of the
issuance and sale by the Trust to the Company of  $2,667,550  million  aggregate
liquidation amount of its Common Securities (as defined herein),  in $88,917,550
million aggregate principal amount of the Debentures; and

         WHEREAS, the Company has requested that the Trustee execute and deliver
this Indenture; and

         WHEREAS,  all  requirements  necessary  to make this  Indenture a valid
instrument  in  accordance  with its  terms,  and to make the  Debentures,  when
executed by the Company and  authenticated  and  delivered by the  Trustee,  the
valid  obligations of the Company,  have been  performed,  and the execution and
delivery of this Indenture have been duly authorized in all respects:
<PAGE>

         WHEREAS,  to provide the terms and conditions upon which the Debentures
are to be authenticated,  issued and delivered,  the Company has duly authorized
the execution of this Indenture; and

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

         NOW,  THEREFORE,  in  consideration of the premises and the purchase of
the Debentures by the holders thereof,  it is mutually  covenanted and agreed as
follows for the equal and ratable benefit of the holders of the Debentures:

                                   ARTICLE I.
                                   DEFINITIONS

Section 1.1.      Definitions of Terms.

         The terms  defined in this  Section  1.1  (except as in this  Indenture
otherwise  expressly provided or unless the context otherwise  requires) for all
purposes of this Indenture and of any indenture  supplemental  hereto shall have
the  respective  meanings  specified in this  Section 1.1 and shall  include the
plural as well as the singular.  All other terms used in this Indenture that are
defined  in the  Trust  Indenture  Act,  or that are by  reference  in the Trust
Indenture  Act  defined  in the  Securities  Act  (except  as  herein  otherwise
expressly  provided or unless the context  otherwise  requires),  shall have the
meanings assigned to such terms in the Trust Indenture Act and in the Securities
Act as in force at the date of the execution of this instrument.  All accounting
terms used herein and not expressly  defined shall have the meanings assigned to
such terms in accordance with Generally Accepted Accounting Principles.

         "Accelerated  Maturity  Date" means if the Company elects to accelerate
the Maturity Date in accordance  with Section  2.2(c),  the date selected by the
Company which is prior to the Scheduled  Maturity  Date,  but is after March 31,
2002.

         "Additional Interest" shall have the meaning set forth in Section 2.5.


<PAGE>

         "Additional  Senior  Obligations" means all indebtedness of the Company
whether  incurred  on or  prior  to the  date of this  Indenture  or  thereafter
incurred,  for claims in respect of  derivative  products  such as interest  and
foreign exchange rate contracts,  commodity contracts and similar  arrangements;
provided, however, that Additional Senior Obligations does not include claims in
respect of Senior  Debt or  Subordinated  Debt or  obligations  which,  by their
terms,  are  expressly  stated to be not  superior  in right of  payment  to the
Debentures  or to rank pari passu in right of payment with the  Debentures.  For
purposes of this definition,  "claim" shall have the meaning assigned thereto in
Section 101(4) of the United States Bankruptcy Code of 1978, as amended.

          "Administrative  Trustees"  shall  have the  meaning  set forth in the
Trust Agreement.

         "Affiliate"  means, with respect to a specified Person,  (a) any Person
directly or indirectly owning,  controlling or holding with power to vote 10% or
more of the outstanding  voting  securities or other ownership  interests of the
specified  Person;  (b)  any  Person  10% or more of  whose  outstanding  voting
securities  or other  ownership  interests  are  directly or  indirectly  owned,
controlled  or held with power to vote by the specified  Person;  (c) any Person
directly or indirectly controlling,  controlled by, or under common control with
the  specified  Person;  (d) a partnership  in which the  specified  Person is a
general partner; (e) any officer or director of the specified Person; and (f) if
the specified Person is an individual,  any entity of which the specified Person
is an officer, director or general partner.

         "Authenticating  Agent" means an  authenticating  agent with respect to
the Debentures appointed by the Trustee pursuant to Section 2.12.

          "Bankruptcy  Law" means Title 11, U.S. Code, or any similar federal or
state law for the relief of debtors.

         "Board of Directors" means the Board of Directors of the Company or any
duly authorized committee of such Board.

         "Board  Resolution"  means  a copy  of a  resolution  certified  by the
Secretary or an Assistant  Secretary of the Company to have been duly adopted by
the Board of  Directors  and to be in full  force and effect on the date of such
certification.

         "Business  Day" means,  with respect to the  Debentures,  any day other
than a  Saturday  or a  Sunday  or a day  on  which  federal  or  state  banking
institutions  in the Borough of Manhattan,  The City of New York, are authorized
or required by law,  executive  order or regulation to close,  or a day on which
the Corporate Trust Office of the Trustee or the Property  Trustee is closed for
business.

          "Certificate"  means a certificate  signed by the principal  executive
officer,  the principal financial officer, the principal accounting officer, the
treasurer or any vice president of the Company.  The Certificate need not comply
with the provisions of Section 15.7.

          "Change  in 1940 Act Law"  shall  have the  meaning  set  forth in the
definition of "Investment Company Event."

         "Commission" means the Securities and Exchange Commission.
<PAGE>

         "Common Securities" means undivided  beneficial interests in the assets
of the Trust  which  rank pari passu with the  Preferred  Securities;  provided,
however,  that upon the occurrence of an Event of Default, the rights of holders
of Common  Securities  to  payment in  respect  of (i)  distributions,  and (ii)
payments upon  liquidation,  redemption  and otherwise are  subordinated  to the
rights of holders of Preferred Securities.

         "Company"  means First Banks,  Inc., a corporation  duly  organized and
existing under the laws of the State of Missouri, and, subject to the provisions
of Article XII, shall also include its successors and assigns.

         "Compounded Interest" shall have the meaning set forth in Section 4.1.

         "Corporate  Trust Office" means the office of the Trustee at which,  at
any  particular   time,  its  corporate  trust  business  shall  be  principally
administered,  which  office at the date hereof is located at Two  International
Place,  4th  Floor,  Boston  Massachusetts  02110,  Attention:  Corporate  Trust
Department.

         "Coupon Rate" shall have the meaning set forth in Section 2.5.

         "Custodian"  means any  receiver,  trustee,  assignee,  liquidator,  or
similar official under any Bankruptcy Law.

         "Debentures" shall have the meaning set forth in the Recitals hereto.

         "Debentureholder,"  "holder of  Debentures,"  "registered  holder,"  or
other  similar  term,  means the  Person  or  Persons  in whose  name or names a
particular  Debenture  shall be  registered  on the books of the  Company or the
Trustee kept for that purpose in accordance with the terms of this Indenture.

          "Debenture  Register"  shall  have the  meaning  set forth in  Section
2.7(b).

         "Debt" means with respect to any Person,  whether recourse is to all or
a portion of the assets of such Person and whether or not contingent,  (i) every
obligation  of such Person for money  borrowed;  (ii) every  obligation  of such
Person  evidenced  by bonds,  debentures,  notes or other  similar  instruments,
including  obligations  incurred in connection with the acquisition of property,
assets or businesses;  (iii) every reimbursement  obligation of such Person with
respect to letters of credit,  bankers' acceptances or similar facilities issued
for the account of such Person;  (iv) every  obligation of such Person issued or
assumed as the deferred  purchase  price of property or services (but  excluding
trade accounts payable or accrued  liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; and (vi) and every
obligation of the type referred to in clauses (i) through (v) of another  Person
and all dividends of another Person the payment of which,  in either case,  such
Person has guaranteed or is responsible  or liable,  directly or indirectly,  as
obligor or otherwise.

         "Default"  means any event,  act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.

         "Deferred Interest" shall have the meaning set forth in Section 4.1.
<PAGE>

         "Dissolution  Event"  means  that as a  result  of the  occurrence  and
continuation of a Special Event, the Trust is to be dissolved in accordance with
the Trust  Agreement and the Debentures  held by the Property  Trustee are to be
distributed to the holders of the Trust Securities  issued by the Trust pro rata
in accordance with the Trust Agreement.

         "Event of Default"  means,  with respect to the  Debentures,  any event
specified in Section 7.1,  which has  continued  for the period of time, if any,
and after the giving of the notice, if any, therein designated.

         "Exchange Act," means the Securities  Exchange Act of 1934, as amended,
as in effect at the date of execution of this instrument.

         "Extended  Interest Payment Period" shall have the meaning set forth in
Section 4.1.

         "Extended  Maturity  Date"  means if the  Company  elects to extend the
Maturity  Date in  accordance  with  Section  2.2(b),  the date  selected by the
Company which is after the Scheduled Maturity Date but before March 31, 2046.

          "Federal  Reserve" means the Board of Governors of the Federal Reserve
System.

         "Generally  Accepted  Accounting   Principles"  means  such  accounting
principles as are  generally  accepted at the time of any  computation  required
hereunder.

         "Governmental   Obligations"  means  securities  that  are  (i)  direct
obligations  of the United  States of America  for the payment of which its full
faith and credit is  pledged;  or (ii)  obligations  of a Person  controlled  or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally  guaranteed as a full faith and
credit  obligation by the United States of America that, in either case, are not
callable  or  redeemable  at the  option of the issuer  thereof,  and shall also
include a depositary  receipt issued by a bank (as defined in Section 3(a)(2) of
the  Securities  Act)  as  custodian  with  respect  to  any  such  Governmental
Obligation  or a  specific  payment  of  principal  of or  interest  on any such
Governmental  Obligation held by such custodian for the account of the holder of
such depositary  receipt;  provided,  however,  that (except as required by law)
such  custodian is not  authorized to make any deduction from the amount payable
to the  holder  of such  depositary  receipt  from any  amount  received  by the
custodian in respect of the  Governmental  Obligation or the specific payment of
principal  of or  interest  on the  Governmental  Obligation  evidenced  by such
depositary receipt.

         "Herein," "hereof," and "hereunder," and other words of similar import,
refer to this Indenture as a whole and not to any particular Article, Section or
other subdivision.

         "Indenture"  means this instrument as originally  executed or as it may
from  time  to  time  be  supplemented  or  amended  by one or  more  indentures
supplemental hereto entered into in accordance with the terms hereof.

         "Interest  Payment Date," when used with respect to any  installment of
interest on the  Debentures,  means the date  specified in the Debenture or in a
Board  Resolution  or in an  indenture  supplemental  hereto with respect to the

<PAGE>

Debentures as the fixed date on which an installment of interest with respect to
the Debentures is due and payable.

         "Investment  Company Act" means the Investment  Company Act of 1940, as
amended, as in effect at the date of execution of this instrument.

         "Investment Company Event" means the receipt by the Trust of an Opinion
of  Counsel,  rendered  by a law  firm  having  a  recognized  national  tax and
securities law practice,  to the effect that, as a result of the occurrence of a
change in law or regulation or a change in  interpretation or application of law
or regulation by any legislative body, court,  governmental agency or regulatory
authority (a "Change in 1940 Act Law"),  the Trust is or shall be  considered an
"investment  company"  that is required to be  registered  under the  Investment
Company Act, which Change in 1940 Act Law becomes effective on or after the date
of original issuance of the Preferred Securities under the Trust Agreement.

         "Maturity  Date" means the date on which the  Debentures  mature and on
which the  principal  shall be due and  payable  together  with all  accrued and
unpaid interest thereon including  Compounded Interest and Additional  Interest,
if any.

         "Ministerial Action" shall have the meaning set forth in Section 3.2.

         "Officers'  Certificate" means a certificate signed by the President or
a  Vice  President  and  by  the  Treasurer  or an  Assistant  Treasurer  or the
Controller or an Assistant Controller or the Secretary or an Assistant Secretary
of the Company  that is delivered  to the Trustee in  accordance  with the terms
hereof.  Each such  certificate  shall  include the  statements  provided for in
Section 15.7, if and to the extent required by the provisions thereof.

         "Opinion of Counsel" means an opinion in writing of legal counsel,  who
may be an employee  of or counsel  for the  Company,  that is  delivered  to the
Trustee in accordance with the terms hereof. Each such opinion shall include the
statements  provided for in Section 15.7,  if and to the extent  required by the
provisions thereof.

         "Outstanding,"  when  used with  reference  to the  Debentures,  means,
subject to the  provisions  of Section  10.4,  as of any  particular  time,  all
Debentures  theretofore  authenticated  and  delivered by the Trustee under this
Indenture,  except (a)  Debentures  theretofore  canceled  by the Trustee or any
paying agent,  or delivered to the Trustee or any paying agent for  cancellation
or that have  previously been canceled;  (b) Debentures or portions  thereof for
the payment or redemption  of which moneys or  Governmental  Obligations  in the
necessary amount shall have been deposited in trust with the Trustee or with any
paying  agent  (other  than the  Company)  or shall  have  been  set  aside  and
segregated  in trust by the Company (if the Company  shall act as its own paying
agent);  provided,  however,  that  if  such  Debentures  or  portions  of  such
Debentures  are to be redeemed  prior to the  maturity  thereof,  notice of such
redemption  shall have been  given as in  Article  III  provided,  or  provision
satisfactory to the Trustee shall have been made for giving such notice; and (c)
Debentures in lieu of or in substitution  for which other  Debentures shall have
been authenticated and delivered pursuant to the terms of Section 2.7.
<PAGE>

         "Person" means any individual, corporation, partnership, joint-venture,
joint-stock company,  unincorporated organization or government or any agency or
political subdivision thereof.

         "Predecessor  Debenture" means every previous Debenture  evidencing all
or a portion of the same debt as that  evidenced by such  particular  Debenture;
and,  for the  purposes of this  definition,  any  Debenture  authenticated  and
delivered  under  Section 2.9 in lieu of a lost,  destroyed or stolen  Debenture
shall be deemed to  evidence  the same  debt as the  lost,  destroyed  or stolen
Debenture.

         "Preferred  Securities"  means  undivided  beneficial  interests in the
assets of the Trust which rank pari passu with Common  Securities  issued by the
Trust;  provided,  however, that upon the occurrence of an Event of Default, the
rights of holders of Common  Securities  to payment in respect of  distributions
and payments upon liquidation,  redemption and otherwise are subordinated to the
rights of holders of Preferred Securities.

         "Preferred  Securities  Guarantee" means any guarantee that the Company
may enter into with the  Trustee  or other  Persons  that  operate  directly  or
indirectly for the benefit of holders of Preferred Securities.

         "Property Trustee" has the meaning set forth in the Trust Agreement.

         "Responsible  Officer"  when used with respect to the Trustee means the
Chairman of the Board of  Directors,  the  President,  any Vice  President,  the
Secretary,  the Treasurer, any trust officer, any corporate trust officer or any
other  officer  or  assistant  officer  of the  Trustee  customarily  performing
functions  similar to those  performed  by the  Persons who at the time shall be
such officers,  respectively,  or to whom any corporate trust matter is referred
because of his or her knowledge of and familiarity with the particular subject.

         "Scheduled Maturity Date" means March 31, 2027.

         "Securities  Act," means the Securities Act of 1933, as amended,  as in
effect at the date of execution of this instrument.

         "Senior  Debt"  means  the  principal  of (and  premium,  if  any)  and
interest,  if any  (including  interest  accruing  on or after the filing of any
petition in bankruptcy or for reorganization  relating to the Company whether or
not such claim for  post-petition  interest is allowed in such  proceeding),  on
Debt,  whether  incurred on or prior to the date of this Indenture or thereafter
incurred,  unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding,  it is provided that such  obligations are not
superior  in right of payment to the  Debentures  or to other Debt which is pari
passu with, or subordinated to, the Debentures;  provided,  however, that Senior
Debt  shall not be deemed to  include  (i) any Debt of the  Company  which  when
incurred and without respect to any election under Section 1111(b) of the United
States Bankruptcy Code of 1978, as amended, was without recourse to the Company;
(ii) any  Debt of the  Company  to any of its  subsidiaries;  (iii)  Debt to any
employee of the Company;  (iv) Debt which by its terms is  subordinated to trade
accounts  payable  or accrued  liabilities  arising  in the  ordinary  course of
business  to the extent  that  payments  made to the holders of such Debt by the
holders of the  Debentures as a result of the  subordination  provisions of this

<PAGE>

Indenture  would be greater than they  otherwise  would have been as a result of
any obligation of such holders to pay amounts over to the obligees on such trade
accounts  payable  or accrued  liabilities  arising  in the  ordinary  course of
business as a result of subordination  provisions to which such Debt is subject;
and (v) Debt which constitutes Subordinated Debt.

         "Senior Indebtedness" shall have the meaning set forth in Section 16.2.

         "Special Event" means a Tax Event or an Investment Company Event.

         "Subordinated  Debt" means the principal of (and  premium,  if any) and
interest,  if any  (including  interest  accruing  on or after the filing of any
petition in bankruptcy or for reorganization  relating to the Company whether or
not such claim for  post-petition  interest is allowed in such  proceeding),  on
Debt,  whether  incurred on or prior to the date of this Indenture or thereafter
incurred,  which is by its terms expressly provided to be junior and subordinate
to other Debt of the Company (other than the Debentures).

         "Subsidiary"  means, with respect to any Person, (i) any corporation at
least a majority of whose  outstanding  Voting Stock shall at the time be owned,
directly or indirectly,  by such Person or by one or more of its Subsidiaries or
by  such  Person  and  one  or  more  of  its  Subsidiaries;  (ii)  any  general
partnership,  joint  venture,  trust or similar  entity,  at least a majority of
whose outstanding partnership or similar interests shall at the time be owned by
such Person, or by one or more of its Subsidiaries, or by such Person and one or
more of its Subsidiaries; and (iii) any limited partnership of which such Person
or any of its Subsidiaries is a general partner.

         "Tax  Event"  means the  receipt by the Trust of an Opinion of Counsel,
rendered by a law firm having a recognized national tax and securities practice,
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 or judicial
decision  interpreting or applying such laws or regulations,  which amendment or
change is effective or which  pronouncement or decision is announced on or after
the date of  issuance of the  Preferred  Securities  under the Trust  Agreement,
there is more  than an  insubstantial  risk  that (i) the  Trust is, or shall be
within 90 days  after the date of such  Opinion  of  Counsel,  subject to United
States  federal  income tax with  respect to income  received  or accrued on the
Debentures;  (ii) interest  payable by the Company on the  Debentures is not, or
within  90 days  after  the  date of such  Opinion  of  Counsel,  shall  not be,
deductible by the Company, in whole or in part, for United States federal income
tax  purposes;  or (iii) the Trust is, or shall be within 90 days after the date
of such  Opinion of Counsel,  subject to more than a de minimis  amount of other
taxes,  duties,  assessments  or other  governmental  charges.  The Trust or the
Company  shall  request and receive  such Opinion of Counsel with regard to such
matters within a reasonable  period of time after the Trust or the Company shall
have become aware of any of the events  described  in clauses (i) through  (iii)
above.

          "Trust" means First  Preferred  Capital  Trust,  a Delaware  statutory
business trust.

         "Trust Agreement" means the Amended and Restated Trust Agreement, dated
February 4, 1997, of the Trust.
<PAGE>

         "Trustee" means State Street Bank and Trust Company and, subject to the
provisions of Article IX, shall also include its successors and assigns, and, if
at any time there is more than one  Person  acting in such  capacity  hereunder,
"Trustee" shall mean each such Person.

         "Trust  Indenture  Act,"  means the  Trust  Indenture  Act of 1939,  as
amended,  subject to the  provisions  of Sections  11.1,  11.2,  and 12.1, as in
effect at the date of execution of this instrument.

          "Trust   Securities"   means  the  Common   Securities  and  Preferred
Securities, collectively.

         "Voting  Stock,"  as  applied  to stock of any  Person,  means  shares,
interests,  participations  or other equivalents in the equity interest (however
designated)  in such Person having  ordinary  voting power for the election of a
majority of the directors (or the equivalent) of such Person, other than shares,
interests,  participations or other equivalents having such power only by reason
of the occurrence of a contingency.

                                   ARTICLE II.
                      ISSUE, DESCRIPTION, TERMS, CONDITIONS
                   REGISTRATION AND EXCHANGE OF THE DEBENTURES

Section 2.1.      Designation and Principal Amount.

         There  is  hereby   authorized   Debentures   designated   the   "9.25%
Subordinated  Debentures  due 2027,"  limited in aggregate  principal  amount to
$88,917,550 million,  which amount shall be as set forth in any written order of
the Company  for the  authentication  and  delivery  of  Debentures  pursuant to
Section 2.6.

Section 2.2.      Maturity.

         (a)      The Maturity Date shall be either:

                  (i)      the Scheduled Maturity Date; or

                  (ii)     if the  Company  elects to extend the  Maturity  Date
                           beyond the Scheduled Maturity Date in accordance with
                           Section 2.2(b), the Extended Maturity Date; or

                  (iii)    if the Company elects to accelerate the Maturity Date
                           to be a date prior to the Scheduled  Maturity Date in
                           accordance  with  Section  2.2(c),   the  Accelerated
                           Maturity Date.

         (b)      the  Company  may at any time  before the day which is 90 days
                  before  the  Scheduled  Maturity  Date,  elect to  extend  the
                  Maturity Date to the Extended Maturity Date, provided that the
                  Company has received the prior approval of the Federal Reserve
                  if  then  required  under  applicable  capital  guidelines  or
                  policies of the Federal Reserve and further  provided that the
                  following conditions in this Section 2.2(b) are satisfied both
                  at the  date the  Company  gives  notice  in  accordance  with
                  Section 2.2(d) of its election to extend the Maturity Date and
                  at the Scheduled Maturity Date:
<PAGE>

                  (i)      the Company is not in bankruptcy, otherwise insolvent
                           or in liquidation;

                  (ii)     the  Company is  not  in  default in the  payment  of
                           interest  or  principal  on the Debentures;

                  (iii)    the Trust  is  not  in   arrears   on   payments   of
                           Distributions  on the  Trust  Securities issued by it
                           and no deferred Distributions are accumulated; and

                  (iv)     the  Company  has  a  rating  on  its  Senior Debt of
                           investment grade.

         (c)      the  Company  may at any time  before the day which is 90 days
                  before the  Scheduled  Maturity Date and after March 31, 2002,
                  elect  to  shorten  the   Maturity   Date  only  once  to  the
                  Accelerated  Maturity  Date  provided  that  the  Company  has
                  received  the prior  approval of the  Federal  Reserve if then
                  required under  applicable  capital  guidelines or policies of
                  the Federal Reserve.

         (d)      if  the  Company   elects  to  extend  the  Maturity  Date  in
                  accordance with Section 2.2(b),  the Company shall give notice
                  to the  registered  holders of the  Debentures,  the  Property
                  Trustee and the Trust of the  extension of the  Maturity  Date
                  and the  Extended  Maturity  Date at least 90 days and no more
                  than 180 days before the Scheduled Maturity Date.

         (e)      if the  Company  elects to  accelerate  the  Maturity  Date in
                  accordance with Section 2.2(c),  the Company shall give notice
                  to the  registered  holders of the  Debentures,  the  Property
                  Trustee and the Trust of the  extension of the  Maturity  Date
                  and the Accelerated Maturity Date at least 90 days and no more
                  than 180 days before the Accelerated Maturity Date.

Section 2.3. Form and.

         The Debentures  shall be issued in fully registered  certificated  form
without  interest  coupons.  Principal and interest on the Debentures  issued in
certificated  form shall be payable,  the transfer of such  Debentures  shall be
registrable and such Debentures  shall be  exchangeable  for Debentures  bearing
identical terms and provisions at the office or agency of the Trustee; provided,
however,  that  payment of interest  may be made at the option of the Company by
check  mailed to the  holder at such  address as shall  appear in the  Debenture
Register or by wire transfer to an account maintained by the holder as specified
in the Debenture  Register,  provided that the holder  provides  proper transfer
instructions by the regular record date.  Notwithstanding the foregoing, so long
as the holder of any  Debentures  is the  Property  Trustee,  the payment of the
principal  of  and  interest  (including   Compounded  Interest  and  Additional
Interest,  if any) on such Debentures held by the Property Trustee shall be made
at such place and to such account as may be designated by the Property Trustee.

Section 2.4.      [Intentionally Omitted].

Section 2.5.      Interest.
<PAGE>

         (a) Each  Debenture  shall bear interest at the rate of 9.25% per annum
(the  "Coupon  Rate") from the  original  date of issuance  until the  principal
thereof becomes due and payable, and on any overdue principal and (to the extent
that  payment of such  interest  is  enforceable  under  applicable  law) on any
overdue  installment  of  interest  at the Coupon  Rate,  compounded  quarterly,
payable  (subject to the provisions of Article IV) quarterly in arrears on March
31, June 30,  September  30 and  December 31 of each year  (each,  an  "Interest
Payment Date,"  commencing on March 31, 1997),  to the Person in whose name such
Debenture or any Predecessor  Debenture is registered,  at the close of business
on the regular  record date for such  interest  installment,  which shall be the
fifteenth day of the last month of the calendar quarter.

         (b) The amount of interest  payable for any period shall be computed on
the basis of a 360-day  year of twelve  30-day  months.  The amount of  interest
payable for any period shorter than a full  quarterly  period for which interest
is computed  shall be  computed on the basis of the number of days  elapsed in a
360-day  year of  twelve  30-day  months.  In the  event  that any date on which
interest is payable on the  Debentures  is not a Business  Day,  then payment of
interest  payable on such date shall be made on the next succeeding day which is
a Business Day (and without any interest or other payment in respect of any such
delay)  with the same force and effect as if made on the date such  payment  was
originally payable.

         (c) If, at any time  while the  Property  Trustee  is the holder of any
Debentures,  the Trust or the  Property  Trustee is  required  to pay any taxes,
duties,  assessments  or  governmental  charges of whatever  nature  (other than
withholding  taxes) imposed by the United States, or any other taxing authority,
then, in any case,  the Company shall pay as  additional  interest  ("Additional
Interest")  on the  Debentures  held by the Property  Trustee,  such  additional
amounts as shall be required so that the net amounts  received  and  retained by
the Trust and the Property Trustee after paying such taxes, duties,  assessments
or other  governmental  charges  shall be equal to the amounts the Trust and the
Property Trustee would have received had no such taxes,  duties,  assessments or
other government charges been imposed.

Section 2.6.      Execution and Authentications.

         (a) The  Debentures  shall be signed on  behalf of the  Company  by its
Chief  Executive  Officer,  President or one of its Vice  Presidents,  under its
corporate  seal attested by its  Secretary or one of its Assistant  Secretaries.
Signatures  may be in the form of a manual or facsimile  signature.  The Company
may use the  facsimile  signature  of any  Person  who  shall  have been a Chief
Executive  Officer,  President or Vice President  thereof,  or of any Person who
shall have been a Secretary or Assistant Secretary thereof,  notwithstanding the
fact that at the time the  Debentures  shall be  authenticated  and delivered or
disposed of such Person  shall have  ceased to be the Chief  Executive  Officer,
President or a Vice President,  or the Secretary or an Assistant  Secretary,  of
the  Company.  The seal of the Company may be in the form of a facsimile of such
seal and may be  impressed,  affixed,  imprinted or otherwise  reproduced on the
Debentures.  The Debentures may contain such notations,  legends or endorsements
required by law, stock exchange rule or usage. Each Debenture shall be dated the
date of its authentication by the Trustee.

         (b) A Debenture shall not be valid until  authenticated  manually by an
authorized  signatory  of  the  Trustee,  or by an  Authenticating  Agent.  Such
signature shall be conclusive  evidence that the Debenture so authenticated  has

<PAGE>

been duly authenticated and delivered  hereunder and that the holder is entitled
to the benefits of this Indenture.

         (c) At any time and from time to time after the  execution and delivery
of this Indenture, the Company may deliver Debentures executed by the Company to
the Trustee for authentication, together with a written order of the Company for
the authentication and delivery of such Debentures signed by its Chief Executive
Officer,  President or any Vice  President  and its  Treasurer or any  Assistant
Treasurer,  and  the  Trustee  in  accordance  with  such  written  order  shall
authenticate and deliver such Debentures.

         (d) In  authenticating  such  Debentures  and accepting the  additional
responsibilities  under this  Indenture  in  relation  to such  Debentures,  the
Trustee  shall be  entitled to receive,  and  (subject to Section  9.1) shall be
fully protected in relying upon, an Opinion of Counsel stating that the form and
terms thereof have been  established  in conformity  with the provisions of this
Indenture.

         (e) The Trustee shall not be required to  authenticate  such Debentures
if the issue of such  Debentures  pursuant to this  Indenture  shall  affect the
Trustee's  own  rights,  duties  or  immunities  under the  Debentures  and this
Indenture  or  otherwise in a manner that is not  reasonably  acceptable  to the
Trustee.

Section 2.7.      Registration of Transfer and Exchange.

         (a) Debentures may be exchanged upon presentation thereof at the office
or  agency  of the  Company  designated  for  such  purpose  in the  Borough  of
Manhattan,  The City of New York, or at the office of the  Debenture  Registrar,
for other Debentures and for a like aggregate  principal amount, upon payment of
a sum  sufficient  to cover any tax or other  governmental  charge  in  relation
thereto,  all as provided in this Section 2.7. In respect of any  Debentures  so
surrendered  for  exchange,   the  Company  shall  execute,  the  Trustee  shall
authenticate  and such office or agency shall  deliver in exchange  therefor the
Debenture or Debentures  that the  Debentureholder  making the exchange shall be
entitled to receive, bearing numbers not contemporaneously outstanding.

         (b) The  Company  shall  keep,  or cause to be kept,  at its  office or
agency designated for such purpose in the Borough of Manhattan,  The City of New
York,  or at the  office of the  Debenture  Registrar,  or such  other  location
designated  by the Company a register or  registers  (herein  referred to as the
"Debenture Register") in which, subject to such reasonable regulations as it may
prescribe,  the Company  shall  register  the  Debentures  and the  transfers of
Debentures  as in this  Article II provided  and which at all  reasonable  times
shall be open for  inspection  by the Trustee.  The registrar for the purpose of
registering  Debentures  and transfer of  Debentures  as herein  provided  shall
initially  be the Trustee and  thereafter  as may be appointed by the Company as
authorized by Board Resolution (the "Debenture  Registrar").  Upon surrender for
transfer of any Debenture at the office or agency of the Company  designated for
such purpose, the Company shall execute, the Trustee shall authenticate and such
office or agency shall deliver in the name of the  transferee  or  transferees a
new  Debenture  or  Debentures  for  a  like  aggregate  principal  amount.  All
Debentures presented or surrendered for exchange or registration of transfer, as
provided  in this  Section  2.7,  shall be  accompanied  (if so  required by the
Company or the Debenture  Registrar) by a written  instrument or  instruments of

<PAGE>

transfer,  in form satisfactory to the Company or the Debenture Registrar,  duly
executed by the registered  holder or by such holder's duly authorized  attorney
in writing.

         (c) No service charge shall be made for any exchange or registration of
transfer  of  Debentures,  or  issue  of  new  Debentures  in  case  of  partial
redemption, but the Company may require payment of a sum sufficient to cover any
tax or other  governmental  charge in  relation  thereto,  other than  exchanges
pursuant to Section  2.8,  the second  paragraph of Section 3.5 and Section 11.4
not involving any transfer.

         (d) The  Company  shall  not be  required  (i) to  issue,  exchange  or
register the transfer of any Debentures during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of  redemption  of
less than all the Outstanding  Debentures and ending at the close of business on
the day of such  mailing;  nor (ii) to register  the transfer of or exchange any
Debentures or portions thereof called for redemption.

Section 2.8.      Temporary Debentures.

         Pending  the  preparation  of  definitive  Debentures,  the Company may
execute,  and the Trustee shall authenticate and deliver,  temporary  Debentures
(printed,  lithographed,  or  typewritten).  Such temporary  Debentures shall be
substantially in the form of the definitive Debentures in lieu of which they are
issued, but with such omissions, insertions and variations as may be appropriate
for  temporary  Debentures,  all as  may be  determined  by the  Company.  Every
temporary Debenture shall be executed by the Company and be authenticated by the
Trustee upon the same conditions and in substantially the same manner,  and with
like effect, as the definitive Debentures. Without unnecessary delay the Company
shall execute and shall furnish  definitive  Debentures and thereupon any or all
temporary  Debentures may be surrendered in exchange therefor (without charge to
the holders),  at the office or agency of the Company designated for the purpose
in the  Borough  of  Manhattan,  The City of New  York,  and the  Trustee  shall
authenticate  and such  office or agency  shall  deliver  in  exchange  for such
temporary   Debentures  an  equal  aggregate   principal  amount  of  definitive
Debentures, unless the Company advises the Trustee to the effect that definitive
Debentures  need not be executed and  furnished  until  further  notice from the
Company.  Until so exchanged,  the temporary Debentures shall be entitled to the
same benefits under this Indenture as definitive  Debentures  authenticated  and
delivered hereunder.

Section 2.9.      Mutilated, Destroyed, Lost or Stolen Debentures.

         (a)  In  case  any  temporary  or  definitive  Debenture  shall  become
mutilated  or be  destroyed,  lost or stolen,  the Company  (subject to the next
succeeding  sentence) shall execute,  and upon the Company's request the Trustee
(subject as aforesaid) shall authenticate and deliver, a new Debenture bearing a
number not contemporaneously  outstanding,  in exchange and substitution for the
mutilated  Debenture,  or in lieu of and in  substitution  for the  Debenture so
destroyed,  lost or  stolen.  In every  case  the  applicant  for a  substituted
Debenture  shall  furnish  to the  Company  and the  Trustee  such  security  or
indemnity  as may be  required  by them to save each of them  harmless,  and, in
every case of  destruction,  loss or theft,  the applicant shall also furnish to
the Company and the Trustee  evidence to their  satisfaction of the destruction,
loss or theft of the  applicant's  Debenture and of the ownership  thereof.  The
Trustee may  authenticate  any such  substituted  Debenture and deliver the same
upon the written  request or  authorization  of the  Chairman,  President or any

<PAGE>

Vice-President and the Treasurer or any Assistant Treasurer of the Company. Upon
the issuance of any substituted  Debenture,  the Company may require the payment
of a sum  sufficient to cover any tax or other  governmental  charge that may be
imposed in  relation  thereto  and any other  expenses  (including  the fees and
expenses of the Trustee)  connected  therewith.  In case any Debenture  that has
matured or is about to mature shall become  mutilated or be  destroyed,  lost or
stolen,  the Company  may,  instead of issuing a  substitute  Debenture,  pay or
authorize the payment of the same (without  surrender thereof except in the case
of a mutilated Debenture) if the applicant for such payment shall furnish to the
Company and the Trustee  such  security or indemnity as they may require to save
them  harmless,  and,  in case of  destruction,  loss or theft,  evidence to the
satisfaction of the Company and the Trustee of the destruction, loss or theft of
such Debenture and of the ownership thereof.

         (b) Every  replacement  Debenture  issued pursuant to the provisions of
this Section 2.9 shall  constitute an additional  contractual  obligation of the
Company whether or not the mutilated,  destroyed, lost or stolen Debenture shall
be found at any time, or be enforceable by anyone,  and shall be entitled to all
the  benefits of this  Indenture  equally and  proportionately  with any and all
other Debentures duly issued  hereunder.  All Debentures shall be held and owned
upon the express  condition  that the foregoing  provisions  are exclusive  with
respect to the  replacement or payment of mutilated,  destroyed,  lost or stolen
Debentures,  and shall  preclude (to the extent lawful) any and all other rights
or remedies, notwithstanding any law or statute existing or hereafter enacted to
the  contrary  with  respect  to  the   replacement  or  payment  of  negotiable
instruments or other securities without their surrender.

Section 2.10.     Cancellation.

         All  Debentures  surrendered  for the purpose of  payment,  redemption,
exchange or registration of transfer shall, if surrendered to the Company or any
paying agent, be delivered to the Trustee for  cancellation,  or, if surrendered
to the Trustee,  shall be canceled by it, and no  Debentures  shall be issued in
lieu thereof except as expressly  required or permitted by any of the provisions
of this Indenture. On request of the Company at the time of such surrender,  the
Trustee shall deliver to the Company canceled Debentures held by the Trustee. In
the absence of such  request the Trustee may dispose of canceled  Debentures  in
accordance with its standard procedures and deliver a certificate of disposition
to the Company.  If the Company shall  otherwise  acquire any of the Debentures,
however,  such acquisition  shall not operate as a redemption or satisfaction of
the  indebtedness  represented by such Debentures  unless and until the same are
delivered to the Trustee for cancellation.


Section 2.11.     Benefit of Indenture.

         Nothing in this  Indenture  or in the  Debentures,  express or implied,
shall give or be construed to give to any Person,  other than the parties hereto
and the  holders of the  Debentures  (and,  with  respect to the  provisions  of
Article XVI, the holders of Senior  Indebtedness)  any legal or equitable right,
remedy or claim under or in respect of this  Indenture,  or under any  covenant,
condition or provision  herein  contained;  all such  covenants,  conditions and
provisions  being for the sole benefit of the parties  hereto and of the holders
of the  Debentures  (and,  with  respect to the  provisions  of Article XVI, the
holders of Senior Indebtedness).
<PAGE>

Section 2.12.     Authentication Agent.

         (a) So long as any of the Debentures remain Outstanding there may be an
Authenticating  Agent for any or all such  Debentures,  which the Trustee  shall
have the right to appoint.  Said Authenticating Agent shall be authorized to act
on behalf of the  Trustee  to  authenticate  Debentures  issued  upon  exchange,
transfer or partial redemption thereof, and Debentures so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if  authenticated  by the Trustee  hereunder.  All references in
this  Indenture to the  authentication  of  Debentures  by the Trustee  shall be
deemed to include authentication by an Authenticating Agent. Each Authenticating
Agent shall be acceptable  to the Company and shall be a corporation  that has a
combined  capital and surplus,  as most  recently  reported or determined by it,
sufficient under the laws of any jurisdiction  under which it is organized or in
which it is doing  business to conduct a trust  business,  and that is otherwise
authorized  under  such  laws  to  conduct  such  business  and  is  subject  to
supervision or examination by federal or state  authorities.  If at any time any
Authenticating  Agent  shall  cease to be  eligible  in  accordance  with  these
provisions, it shall resign immediately.

         (b) Any  Authenticating  Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company.  The Trustee may at any
time (and  upon  request  by the  Company  shall)  terminate  the  agency of any
Authenticating   Agent  by  giving   written   notice  of  termination  to  such
Authenticating  Agent  and to the  Company.  Upon  resignation,  termination  or
cessation of eligibility of any Authenticating Agent, the Trustee may appoint an
eligible successor Authenticating Agent acceptable to the Company. Any successor
Authenticating Agent, upon acceptance of its appointment hereunder, shall become
vested with all the rights, powers and duties of its predecessor hereunder as if
originally named as an Authenticating Agent pursuant hereto.


                                  ARTICLE III.
                            REDEMPTION OF DEBENTURES

Section 3.1.      Redemption.

         Subject to the Company  having  received  prior approval of the Federal
Reserve, if then required under the applicable capital guidelines or policies of
the Federal Reserve,  the Company may redeem the Debentures  issued hereunder on
and  after  the  dates  set  forth in and in  accordance  with the terms of this
Article III.

Section 3.2.      Special Event Redemption.

         Subject  to the  Company  having  received  the prior  approval  of the
Federal  Reserve,  if then required under the applicable  capital  guidelines or
policies  of the  Federal  Reserve,  if a  Special  Event  has  occurred  and is
continuing,  then, notwithstanding Section 3.3(a) but subject to Section 3.3(b),
the  Company  shall  have the right  upon not less than 30 days nor more than 60
days notice to the holders of the Debentures to redeem the Debentures,  in whole
but not in part,  for cash  within 180 days  following  the  occurrence  of such
Special Event (the "180-Day  Period") at a redemption price equal to 100% of the
principal  amount to be redeemed plus any accrued and unpaid interest thereon to

<PAGE>

the date of such redemption (the  "Redemption  Price"),  provided that if at the
time there is available to the Company the opportunity to eliminate,  within the
180-Day Period,  a Tax Event by taking some  ministerial  action (a "Ministerial
Action"),  such as filing a form or making an election,  or pursuing  some other
similar reasonable measure which has no adverse effect on the Company, the Trust
or the holders of the Trust  Securities  issued by the Trust,  the Company shall
pursue such Ministerial  Action in lieu of redemption,  and,  provided  further,
that the Company shall have no right to redeem the Debentures while the Trust is
pursuing any  Ministerial  Action  pursuant to its  obligations  under the Trust
Agreement.  The  Redemption  Price shall be paid prior to 12:00  noon,  New York
time,  on the  date  of such  redemption  or such  earlier  time as the  Company
determines,  provided  that the Company shall deposit with the Trustee an amount
sufficient to pay the Redemption Price by 10:00 a.m., New York time, on the date
such Redemption Price is to be paid.

Section 3.3.      Optional Redemption by Company.

         (a) Subject to the  provisions of Section  3.3(b),  except as otherwise
may be specified in this  Indenture,  the Company shall have the right to redeem
the  Debentures,  in whole or in part,  from time to time, on or after March 31,
2002, at a Redemption Price equal to 100% of the principal amount to be redeemed
plus any accrued and unpaid interest thereon to the date of such redemption. Any
redemption  pursuant to this Section  3.3(a) shall be made upon not less than 30
days nor more  than 60 days  notice  to the  holder  of the  Debentures,  at the
Redemption Price. If the Debentures are only partially redeemed pursuant to this
Section  3.3,  the  Debentures  shall be redeemed  pro rata or by lot or in such
other manner as the Trustee shall deem  appropriate  and fair in its discretion.
The  Redemption  Price shall be paid prior to 12:00 noon,  New York time, on the
date of  such  redemption  or at such  earlier  time as the  Company  determines
provided that the Company shall deposit with the Trustee an amount sufficient to
pay the  Redemption  Price  by  10:00  a.m.,  New York  time,  on the date  such
Redemption Price is to be paid.

         (b) If a  partial  redemption  of the  Debentures  would  result in the
delisting of the Preferred  Securities issued by the Trust from The Nasdaq Stock
Market's  National  Market  or  any  national   securities   exchange  or  other
organization  on which the  Preferred  Securities  are then listed,  the Company
shall not be permitted to effect such partial redemption and may only redeem the
Debentures in whole.

Section 3.4.      Notice of Redemption.

         (a) In case the Company  shall desire to exercise  such right to redeem
all or, as the case may be, a portion of the  Debentures in accordance  with the
right reserved so to do, the Company  shall,  or shall cause the Trustee to upon
receipt of 45 days' written notice from the Company (which notice shall,  in the
event of a partial redemption,  include a representation to the effect that such
partial redemption shall not result in the delisting of the Preferred Securities
as described in Section 3.3(b) above), give notice of such redemption to holders
of the  Debentures  to be redeemed by mailing,  first class postage  prepaid,  a
notice of such redemption not less than 30 days and not more than 60 days before
the date fixed for  redemption  to such holders at their last  addresses as they
shall appear upon the Debenture Register unless a shorter period is specified in
the  Debentures  to be redeemed.  Any notice that is mailed in the manner herein
provided shall be conclusively  presumed to have been duly given, whether or not
the registered  holder  receives the notice.  In any case,  failure duly to give
such notice to the holder of any Debenture designated for redemption in whole or

<PAGE>

in part,  or any defect in the  notice,  shall not affect  the  validity  of the
proceedings  for the  redemption  of any  other  Debentures.  In the case of any
redemption of Debentures  prior to the  expiration  of any  restriction  on such
redemption  provided  in the  terms  of such  Debentures  or  elsewhere  in this
Indenture,  the Company shall furnish the Trustee with an Officers'  Certificate
evidencing compliance with any such restriction.  Each such notice of redemption
shall specify the date fixed for redemption  and the Redemption  Price and shall
state that payment of the Redemption Price shall be made at the office or agency
of the  Company  in the  Borough  of  Manhattan,  The City of New York or at the
Corporate Trust Office, upon presentation and surrender of such Debentures, that
interest  accrued to the date fixed for redemption shall be paid as specified in
said notice and that from and after said date interest shall cease to accrue. If
less than all the  Debentures  are to be redeemed,  the notice to the holders of
the Debentures  shall specify the particular  Debentures to be redeemed.  If the
Debentures  are to be redeemed in part only,  the notice shall state the portion
of the principal amount thereof to be redeemed and shall state that on and after
the  redemption  date,  upon  surrender of such  Debenture,  a new  Debenture or
Debentures in principal amount equal to the unredeemed  portion thereof shall be
issued.

         (b) If less than all the  Debentures  are to be  redeemed,  the Company
shall give the Trustee at least 45 days' notice in advance of the date fixed for
redemption  as to the aggregate  principal  amount of Debentures to be redeemed,
and thereupon  the Trustee  shall  select,  by lot or in such other manner as it
shall deem  appropriate  and fair in its  discretion,  the  portion or  portions
(equal to $25 or any integral multiple thereof) of the Debentures to be redeemed
and shall  thereafter  promptly  notify the Company in writing of the numbers of
the  Debentures  to be  redeemed,  in whole or in part.  The Company may, if and
whenever  it shall  so elect  pursuant  to the  terms  hereof,  by  delivery  of
instructions  signed  on its  behalf  by its  President  or any Vice  President,
instruct  the  Trustee  or any  paying  agent  to  call  all or any  part of the
Debentures  for  redemption  and to give notice of  redemption in the manner set
forth in this Section  3.4,  such notice to be in the name of the Company or its
own name as the Trustee or such paying agent may deem advisable.  In any case in
which  notice of  redemption  is to be given by the  Trustee or any such  paying
agent,  the  Company  shall  deliver or cause to be  delivered  to, or permit to
remain  with,  the  Trustee  or such  paying  agent,  as the case  may be,  such
Debenture  Register,  transfer  books or other  records,  or suitable  copies or
extracts  therefrom,  sufficient  to enable the Trustee or such paying  agent to
give any  notice  by mail that may be  required  under  the  provisions  of this
Section 3.4.



Section 3.5.      Payment Upon Redemption.

         (a) If the giving of notice of redemption  shall have been completed as
above  provided,  the  Debentures  or  portions  of  Debentures  to be  redeemed
specified  in such  notice  shall  become due and payable on the date and at the
place stated in such notice at the applicable  Redemption Price, and interest on
such Debentures or portions of Debentures shall cease to accrue on and after the
date fixed for  redemption,  unless the Company  shall default in the payment of
such Redemption Price with respect to any such Debenture or portion thereof.  On
presentation  and  surrender of such  Debentures  on or after the date fixed for

<PAGE>

redemption  at the place of payment  specified  in the notice,  said  Debentures
shall be paid and  redeemed at the  Redemption  Price (but if the date fixed for
redemption is an interest payment date, the interest installment payable on such
date shall be payable to the  registered  holder at the close of business on the
applicable record date pursuant to Section 3.3).

         (b) Upon  presentation  of any Debenture that is to be redeemed in part
only,  the Company  shall  execute and the Trustee  shall  authenticate  and the
office or agency where the  Debenture is presented  shall  deliver to the holder
thereof,  at  the  expense  of  the  Company,  a  new  Debenture  of  authorized
denomination  in  principal  amount  equal  to  the  unredeemed  portion  of the
Debenture so presented.

Section 3.6.      No Sinking Fund.

         The Debentures are not entitled to the benefit of any sinking fund.


                                   ARTICLE IV.
                      EXTENSION OF INTEREST PAYMENT PERIOD

Section 4.1.      Extension of Interest Payment Period.

         So long as no Event of Default  has  occurred  and is  continuing,  the
Company shall have the right,  at any time and from time to time during the term
of the  Debentures,  to defer  payments of interest by  extending  the  interest
payment  period of such  Debentures  for a period not  exceeding 20  consecutive
quarters  (the  "Extended  Interest  Payment  Period"),  during  which  Extended
Interest  Payment Period no interest shall be due and payable;  provided that no
Extended Interest Payment Period may extend beyond the Maturity Date.  Interest,
the payment of which has been deferred  because of the extension of the interest
payment period pursuant to this Section 4.1, shall bear interest  thereon at the
Coupon Rate  compounded  quarterly  for each  quarter of the  Extended  Interest
Payment  Period  ("Compounded  Interest").  At the end of the Extended  Interest
Payment Period, the Company shall calculate (and deliver such calculation to the
Trustee) and pay all interest  accrued and unpaid on the  Debentures,  including
any Additional Interest and Compounded Interest (together,  "Deferred Interest")
that shall be  payable  to the  holders  of the  Debentures  in whose  names the
Debentures  are  registered in the  Debenture  Register on the first record date
after the end of the Extended Interest Payment Period. Before the termination of
any  Extended  Interest  Payment  Period,  the Company  may further  extend such
period,  provided  that such period  together  with all such further  extensions
thereof shall not exceed 20 consecutive  quarters, or extend beyond the Maturity
Date of the Debentures.  Upon the termination of any Extended  Interest  Payment
Period and upon the payment of all Deferred  Interest  then due, the Company may
commence a new  Extended  Interest  Payment  Period,  subject  to the  foregoing
requirements.  No interest shall be due and payable during an Extended  Interest
Payment  Period,  except at the end  thereof,  but the Company may prepay at any
time all or any portion of the  interest  accrued  during an  Extended  Interest
Payment Period.

Section 4.2.      Notice of Extension.

         (a) If the  Property  Trustee  is the  only  registered  holder  of the
Debentures at the time the Company selects an Extended  Interest Payment Period,
the  Company  shall give  written  notice to the  Administrative  Trustees,  the
Property  Trustee and the Trustee of its  selection  of such  Extended  Interest

<PAGE>

Payment  Period two Business Days before the earlier of (i) the next  succeeding
date on which  Distributions  on the  Trust  Securities  issued by the Trust are
payable;  or (ii) the date the Trust is  required  to give  notice of the record
date, or the date such  Distributions are payable,  to The Nasdaq Stock Market's
National Market or other applicable  self-regulatory  organization or to holders
of the Preferred  Securities  issued by the Trust, but in any event at least one
Business Day before such record date.

         (b) If the Property Trustee is not the only holder of the Debentures at
the time the Company selects an Extended  Interest  Payment Period,  the Company
shall give the holders of the Debentures  and the Trustee  written notice of its
selection of such Extended  Interest  Payment  Period at least two Business Days
before the earlier of (i) the next succeeding Interest Payment Date; or (ii) the
date the Company is  required  to give  notice of the record or payment  date of
such  interest  payment to The Nasdaq Stock  Market's  National  Market or other
applicable self-regulatory organization or to holders of the Debentures.

         (c) The quarter in which any notice is given pursuant to paragraphs (a)
or (b) of this Section 4.2 shall be counted as one of the 20 quarters  permitted
in the maximum Extended Interest Payment Period permitted under Section 4.1.

Section 4.3.      Limitation on Transactions.

         If (i) the  Company  shall  exercise  its  right  to defer  payment  of
interest as provided in Section 4.1; or (ii) there shall have occurred any Event
of Default,  then (a) the Company shall not declare or pay any dividend on, make
any  distributions  with  respect  to, or  redeem,  purchase,  acquire or make a
liquidation payment with respect to, any of its capital stock (other than (i) as
a result of a  reclassification  of its capital  stock for another  class of its
capital  stock;  or (ii) the  conversion of the Company's  Class A  Convertible,
Adjustable Rate Preferred Stock to the Company's common stock, par value $250.00
per share); (b) the Company shall not make any payment of interest, principal or
premium,  if any, or repay,  repurchase or redeem any debt securities  issued by
the Company  which rank pari passu with or junior to the  Debentures;  provided,
however,  that  notwithstanding  the  foregoing  the Company  may make  payments
pursuant to its obligations under the Preferred  Securities  Guarantee;  and (c)
the  Company  shall  not  redeem,  purchase  or  acquire  less  than  all of the
outstanding Debentures or any of the Preferred Securities.




<PAGE>


                                   ARTICLE V.
                       PARTICULAR COVENANTS OF THE COMPANY

Section 5.1.      Payment of Principal and Interest.

         The  Company  shall  duly  and  punctually  pay or cause to be paid the
principal  of and  interest on the  Debentures  at the time and place and in the
manner provided herein.

Section 5.2.      Maintenance of Agency.

         So long as any of the Debentures remain Outstanding,  the Company shall
maintain an office or agency in the Borough of Manhattan,  The City of New York,
and at such other location or locations as may be designated as provided in this
Section 5.2, where (i) Debentures may be presented for payment;  (ii) Debentures
may be presented as  hereinabove  authorized  for  registration  of transfer and
exchange; and (iii) notices and demands to or upon the Company in respect of the
Debentures  and this  Indenture  may be given or  served,  such  designation  to
continue  with  respect to such  office or agency  until the Company  shall,  by
written  notice signed by its President or a Vice President and delivered to the
Trustee, designate some other office or agency for such purposes or any of them.
If at any time the Company  shall fail to maintain any such  required  office or
agency or shall fail to furnish  the  Trustee  with the  address  thereof,  such
presentations,  notices and demands may be made or served at the Corporate Trust
Office of the Trustee,  and the Company hereby appoints the Trustee as its agent
to receive all such presentations,  notices and demands. In addition to any such
office  or  agency,  the  Company  may from time to time  designate  one or more
offices or agencies  outside of the Borough of Manhattan,  The City of New York,
where the  Debentures  may be  presented  for  registration  or transfer and for
exchange in the manner  provided  herein,  and the Company may from time to time
rescind  such  designation  as the  Company  may deem  desirable  or  expedient;
provided,  however,  that no such  designation or rescission shall in any manner
relieve the Company of its  obligation  to maintain any such office or agency in
the  Borough  of  Manhattan,  The  City  of New  York,  for the  purposes  above
mentioned.  The Company shall give the Trustee prompt written notice of any such
designation or rescission thereof.

Section 5.3.      Paying Agents.

         (a) The Property  Trustee shall act as the Paying Agent. If the Company
shall  appoint  one or more  paying  agents for the  Debentures,  other than the
Trustee,  the Company  shall cause each such paying agent to execute and deliver
to the Trustee an  instrument  in which such agent shall agree with the Trustee,
subject to the provisions of this Section 5.3:

                  (i) that it shall  hold all sums held by it as such  agent for
         the payment of the principal of or interest on the Debentures  (whether
         such sums have been paid to it by the  Company or by any other  obligor
         of such  Debentures)  in trust for the benefit of the Persons  entitled
         thereto;

                  (ii) that it shall give the  Trustee  notice of any failure by
         the Company (or by any other  obligor of such  Debentures)  to make any
         payment of the principal of or interest on the Debentures when the same
         shall be due and payable;
<PAGE>

                  (iii) that it shall, at any time during the continuance of any
         failure referred to in the preceding  paragraph (a)(ii) above, upon the
         written  request of the Trustee,  forthwith pay to the Trustee all sums
         so held in trust by such paying agent; and

                  (iv) that it shall perform all other duties of paying agent as
         set forth in this Indenture.

         (b) If the Company  shall act as its own paying  agent with  respect to
the  Debentures,  it shall on or  before  each due date of the  principal  of or
interest  on such  Debentures,  set aside,  segregate  and hold in trust for the
benefit of the Persons  entitled  thereto a sum sufficient to pay such principal
or interest so becoming due on Debentures  until such sums shall be paid to such
Persons or otherwise  disposed of as herein  provided and shall promptly  notify
the Trustee of such action,  or any failure (by it or any other  obligor on such
Debentures)  to take such action.  Whenever  the Company  shall have one or more
paying  agents  for the  Debentures,  it  shall,  prior  to each due date of the
principal of or interest on any Debentures,  deposit with the paying agent a sum
sufficient to pay the principal or interest so becoming due, such sum to be held
in trust for the benefit of the Persons  entitled to such principal or interest,
and (unless such paying agent is the Trustee) the Company shall promptly  notify
the Trustee of this action or failure so to act.

         (c) Notwithstanding  anything in this Section 5.3 to the contrary,  (i)
the  agreement  to hold sums in trust as provided in this Section 5.3 is subject
to the  provisions  of Section  13.3 and 13.4;  and (ii) the  Company may at any
time,  for the purpose of  obtaining  the  satisfaction  and  discharge  of this
Indenture or for any other  purpose,  pay, or direct any paying agent to pay, to
the Trustee all sums held in trust by the  Company or such  paying  agent,  such
sums to be held by the Trustee upon the same terms and  conditions as those upon
which such sums were held by the Company or such paying  agent;  and,  upon such
payment by any paying agent to the Trustee,  such paying agent shall be released
from all further liability with respect to such money.

Section 5.4.      Appointment to Fill Vacancy in Office of Trustee.

         The  Company,  whenever  necessary  to avoid or fill a  vacancy  in the
office of Trustee,  shall  appoint,  in the manner  provided in Section  9.10, a
Trustee, so that there shall at all times be a Trustee hereunder.

Section 5.5.      Compliance with Consolidation Provisions.

         The Company shall not, while any of the Debentures remain  outstanding,
consolidate  with, or merge into, or merge into itself, or sell or convey all or
substantially  all of its property to any other company unless the provisions of
Article XII hereof are complied with.

Section 5.6.      Limitation on Transactions.

         If  Debentures  are  issued to the  Trust or a trustee  of the Trust in
connection  with the  issuance  of Trust  Securities  by the Trust and (i) there
shall have occurred any event that would  constitute  an Event of Default;  (ii)
the Company  shall be in default with respect to its payment of any  obligations
under the Preferred  Securities  Guarantee  relating to the Trust;  or (iii) the
Company shall have given notice of its election to defer payments of interest on
such  Debentures  by extending the interest  payment  period as provided in this

<PAGE>

Indenture and such period, or any extension thereof,  shall be continuing,  then
(a) the Company shall not declare or pay any dividend on, make any distributions
with respect to, or redeem, purchase, acquire or make a liquidation payment with
respect  to,  any of  its  capital  stock  (other  than  (i)  as a  result  of a
reclassification of its capital stock for another class of its capital stock; or
(ii) the  conversion  of the  Company's  Class A  Convertible,  Adjustable  Rate
Preferred Stock to the Company's common stock, par value $250.00 per share); (b)
the Company  shall not make any payment of interest,  principal  or premium,  if
any, or repay,  repurchase or redeem any debt  securities  issued by the Company
which rank pari passu with or junior to the Debentures;  provided, however, that
the Company may make payments  pursuant to its  obligations  under the Preferred
Securities Guarantee;  and (c) the Company shall not redeem, purchase or acquire
less than all of the outstanding Debentures or any of the Preferred Securities.

Section 5.7.      Covenants as to the Trust.

         For so long as such Trust  Securities of the Trust remain  outstanding,
the Company shall (i) maintain  100% direct or indirect  ownership of the Common
Securities of the Trust; provided,  however, that any permitted successor of the
Company  under this  Indenture  may succeed to the  Company's  ownership  of the
Common  Securities;  (ii) not  voluntarily  terminate,  wind up or liquidate the
Trust,  except upon prior  approval  of the Federal  Reserve if then so required
under applicable  capital  guidelines or policies of the Federal Reserve and use
its reasonable efforts to cause the Trust (a) to remain a business trust, except
in connection  with a distribution  of Debentures,  the redemption of all of the
Trust   Securities  of  the  Trust  or  certain   mergers,   consolidations   or
amalgamations,  each as permitted by the Trust  Agreement;  and (b) to otherwise
continue  not to be  treated  as an  association  taxable  as a  corporation  or
partnership  for United States  federal  income tax purposes;  and (iii) use its
reasonable  efforts to cause each  holder of Trust  Securities  to be treated as
owning an individual  beneficial interest in the Debentures.  In connection with
the  distribution  of the Debentures to the holders of the Preferred  Securities
issued by the Trust upon a  Dissolution  Event,  the Company  shall use its best
efforts to list such Debentures on The Nasdaq Stock Market's  National Market or
on such other exchange as the Preferred Securities are then listed.

Section 5.8.      Covenants as to Purchases.

         Prior to March 31, 2002, the Company shall not purchase any Debentures,
in whole or in part, from the Trust.


                                   ARTICLE VI.
                       DEBENTUREHOLDERS' LISTS AND REPORTS
                         BY THE COMPANY AND THE TRUSTEE

Section 6.1.      Company   to  Furnish   Trustee   Names   and   Addresses   of
                  Debentureholders.

         The Company  shall  furnish or cause to be furnished to the Trustee (a)
on a monthly  basis on each regular  record date (as described in Section 2.5) a
list,  in such form as the  Trustee  may  reasonably  require,  of the names and
addresses  of the holders of the  Debentures  as of such  regular  record  date,
provided  that the Company shall not be obligated to furnish or cause to furnish
such list at any time that the list  shall not  differ in any  respect  from the

<PAGE>

most  recent  list  furnished  to the  Trustee by the  Company (in the event the
Company  fails to provide  such list on a monthly  basis,  the Trustee  shall be
entitled to rely on the most recent list  provided by the  Company);  and (b) at
such other times as the Trustee may request in writing  within 30 days after the
receipt by the Company of any such  request,  a list of similar form and content
as of a date not more than 15 days  prior to the time  such  list is  furnished;
provided,  however,  that, in either case, no such list need be furnished if the
Trustee shall be the Debenture Registrar.

Section 6.2.   Preservation of Information Communications with Debentureholders.

         (a) The Trustee shall  preserve,  in as current a form as is reasonably
practicable,  all  information  as to the names and  addresses of the holders of
Debentures  contained  in the most  recent list  furnished  to it as provided in
Section 6.1 and as to the names and addresses of holders of Debentures  received
by the Trustee in its capacity as  registrar  for the  Debentures  (if acting in
such capacity).

          (b) The Trustee may  destroy any list  furnished  to it as provided in
Section 6.1 upon receipt of a new list so furnished.

         (c)  Debentureholders  may communicate as provided in Section 312(b) of
the Trust Indenture Act with other Debentureholders with respect to their rights
under this Indenture or under the Debentures.

Section 6.3.      Reports by the.

         (a) The Company  covenants and agrees to file with the Trustee,  within
15 days after the  Company  is  required  to file the same with the  Commission,
copies of the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the  Commission  may from
time to time by  rules  and  regulations  prescribe)  that  the  Company  may be
required to file with the Commission  pursuant to Section 13 or Section 15(d) of
the  Exchange  Act;  or, if the  Company is not  required  to file  information,
documents or reports pursuant to either of such sections,  then to file with the
Trustee  and the  Commission,  in  accordance  with the  rules  and  regulations
prescribed from time to time by the Commission,  such of the  supplementary  and
periodic  information,  documents  and reports that may be required  pursuant to
Section 13 of the Exchange Act in respect of a security listed and registered on
a national  securities  exchange as may be prescribed  from time to time in such
rules and regulations.

         (b) The Company  covenants  and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from to time
by the  Commission,  such  additional  information,  documents  and reports with
respect to compliance by the Company with the conditions and covenants  provided
for in this  Indenture  as may be  required  from time to time by such rules and
regulations.

         (c) The Company  covenants and agrees to transmit by mail,  first class
postage  prepaid,  or reputable  over-night  delivery  service that provides for
evidence  of receipt,  to the  Debentureholders,  as their  names and  addresses
appear upon the Debenture Register, within 30 days after the filing thereof with
the Trustee,  such summaries of any information,  documents and reports required

<PAGE>

to be filed by the Company  pursuant to subsections  (a) and (b) of this Section
6.3 as may be required by rules and regulations  prescribed from time to time by
the Commission.

Section 6.4.      Reports by the Trustee.

         (a) On or before  July 15 in each  year in which any of the  Debentures
are  Outstanding,  the  Trustee  shall  transmit by mail,  first  class  postage
prepaid, to the  Debentureholders,  as their names and addresses appear upon the
Debenture  Register,  a brief report dated as of the preceding May 15, if and to
the extent required under Section 313(a) of the Trust Indenture Act.

          (b) The Trustee  shall  comply with  Section  313(b) and 313(c) of the
Trust Indenture Act.

         (c) A copy of each such report shall, at the time of such  transmission
to Debentureholders,  be filed by the Trustee with the Company,  with each stock
exchange upon which any  Debentures  are listed (if so listed) and also with the
Commission.  The Company agrees to notify the Trustee when any Debentures become
listed on any stock exchange.


                                  ARTICLE VII.
                  REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
                               ON EVENT OF DEFAULT

Section 7.1.      Events of

         (a)  Whenever  used herein with  respect to the  Debentures,  "Event of
Default" means any one or more of the following  events that has occurred and is
continuing:

                  (i) the Company  defaults in the payment of any installment of
         interest upon any of the Debentures,  as and when the same shall become
         due and  payable,  and  continuance  of such default for a period of 30
         days; provided,  however, that a valid extension of an interest payment
         period by the Company in  accordance  with the terms of this  Indenture
         shall not  constitute  a default in the  payment of  interest  for this
         purpose;

                  (ii) the Company  defaults in the payment of the  principal on
         the  Debentures  as and when  the same  shall  become  due and  payable
         whether at maturity,  upon  redemption,  by  declaration  or otherwise;
         provided,  however,  that a valid  extension  of the  maturity  of such
         Debentures in  accordance  with the terms of this  Indenture  shall not
         constitute a default in the payment of principal;

                  (iii) the Company fails to observe or perform any other of its
         covenants or agreements  with respect to the Debentures for a period of
         90 days  after  the  date on  which  written  notice  of such  failure,
         requiring  the same to be remedied  and  stating  that such notice is a
         "Notice of Default" hereunder,  shall have been given to the Company by
         the Trustee, by registered or certified mail, or to the Company and the
         Trustee  by the  holders  of at least  25% in  principal  amount of the
         Debentures at the time Outstanding;
<PAGE>

                  (iv) the  Company  pursuant  to or within  the  meaning of any
         Bankruptcy  Law (i)  commences a voluntary  case;  (ii) consents to the
         entry of an order for relief against it in an involuntary  case;  (iii)
         consents  to  the  appointment  of a  Custodian  of it or  for  all  or
         substantially all of its property;  or (iv) makes a general  assignment
         for the benefit of its creditors;

                  (v) a court of  competent  jurisdiction  enters an order under
         any  Bankruptcy  Law that (i) is for relief  against  the Company in an
         involuntary  case;  (ii) appoints a Custodian of the Company for all or
         substantially  all of its property;  or (iii) orders the liquidation of
         the Company, and the order or decree remains unstayed and in effect for
         90 days; or

                  (vi)  the  Trust  shall  have   voluntarily  or  involuntarily
         dissolved,  wound-up its business or otherwise terminated its existence
         except in connection with (i) the distribution of Debentures to holders
         of Trust  Securities in  liquidation  of their  interests in the Trust;
         (ii) the redemption of all of the outstanding  Trust  Securities of the
         Trust; or (iii) certain mergers, consolidations or amalgamations,  each
         as permitted by the Trust Agreement.

         (b) In each and  every  such  case,  unless  the  principal  of all the
Debentures shall have already become due and payable,  either the Trustee or the
holders of not less than 25% in  aggregate  principal  amount of the  Debentures
then  Outstanding  hereunder,  by notice in writing to the  Company  (and to the
Trustee if given by such  Debentureholders) may declare the principal of all the
Debentures to be due and payable immediately,  and upon any such declaration the
same shall  become and shall be  immediately  due and  payable,  notwithstanding
anything contained in this Indenture or in the Debentures.

         (c) At any time after the principal of the  Debentures  shall have been
so declared due and  payable,  and before any judgment or decree for the payment
of the moneys due shall have been obtained or entered as  hereinafter  provided,
the holders of a majority in aggregate  principal  amount of the Debentures then
Outstanding  hereunder,  by written  notice to the Company and the Trustee,  may
rescind and annul such  declaration and its consequences if: (i) the Company has
paid  or  deposited  with  the  Trustee  a sum  sufficient  to pay  all  matured
installments  of interest upon all the  Debentures  and the principal of any and
all Debentures that shall have become due otherwise than by  acceleration  (with
interest upon such principal,  and upon overdue installments of interest, at the
rate per  annum  expressed  in the  Debentures  to the date of such  payment  or
deposit) and the amount  payable to the Trustee  under Section 9.6; and (ii) any
and all Events of Default  under this  Indenture,  other than the  nonpayment of
principal on  Debentures  that shall not have become due by their  terms,  shall
have been remedied or waived as provided in Section 7.6. No such  rescission and
annulment  shall extend to or shall affect any subsequent  default or impair any
right consequent thereon.

         (d) In case the Trustee shall have  proceeded to enforce any right with
respect to Debentures under this Indenture and such proceedings  shall have been
discontinued  or abandoned  because of such  rescission  or annulment or for any
other reason or shall have been determined adversely to the Trustee, then and in
every such case the Company and the Trustee  shall be restored  respectively  to

<PAGE>

their former positions and rights hereunder, and all rights, remedies and powers
of the Company and the Trustee shall continue as though no such  proceedings had
been taken.

Section 7.2.    Collection of Indebtedness and Suits for Enforcement by Trustee.

         (a) The  Company  covenants  that (1) in case it shall  default  in the
payment  of any  installment  of  interest  on any of the  Debentures,  and such
default shall have continued for a period of 90 Business Days; or (2) in case it
shall default in the payment of the principal of any of the Debentures  when the
same shall have become due and payable,  whether upon maturity of the Debentures
or upon  redemption or upon  declaration or otherwise,  then, upon demand of the
Trustee, the Company shall pay to the Trustee, for the benefit of the holders of
the  Debentures,  the whole  amount  that then  shall  have been  become due and
payable on all such  Debentures for principal or interest,  or both, as the case
may be, with interest upon the overdue principal and (if the Debentures are held
by the Trust or a trustee of the Trust, without duplication of any other amounts
paid by the Trust or trustee in respect  thereof) upon overdue  installments  of
interest at the rate per annum  expressed  in the  Debentures;  and, in addition
thereto,  such  further  amount  as shall be  sufficient  to cover the costs and
expenses of collection, and the amount payable to the Trustee under Section 9.7.

         (b) If the Company shall fail to pay such amounts  forthwith  upon such
demand,  the Trustee,  in its own name and as trustee of an express trust, shall
be entitled and  empowered to institute any action or  proceedings  at law or in
equity for the  collection of the sums so due and unpaid,  and may prosecute any
such action or proceeding to judgment or final decree,  and may enforce any such
judgment  or  final  decree  against  the  Company  or  other  obligor  upon the
Debentures  and  collect  the  moneys  adjudged  or decreed to be payable in the
manner  provided by law out of the property of the Company or other obligor upon
the Debentures, wherever situated.

         (c) In case of any receivership,  insolvency, liquidation,  bankruptcy,
reorganization,  readjustment,  arrangement, composition or judicial proceedings
affecting the Company or the creditors or property of either,  the Trustee shall
have power to intervene in such proceedings and take any action therein that may
be permitted by the court and shall (except as may be otherwise provided by law)
be entitled to file such proofs of claim and other  papers and  documents as may
be  necessary or advisable in order to have the claims of the Trustee and of the
holders of the  Debentures  allowed for the entire amount due and payable by the
Company under this Indenture at the date of institution of such  proceedings and
for any  additional  amount that may become due and payable by the Company after
such date,  and to collect and receive any moneys or other  property  payable or
deliverable on any such claim, and to distribute the same after the deduction of
the amount payable to the Trustee under Section 9.7; and any receiver,  assignee
or trustee in bankruptcy or  reorganization  is hereby authorized by each of the
holders of the  Debentures  to make such  payments to the  Trustee,  and, in the
event that the Trustee shall consent to the making of such payments  directly to
such  Debentureholders,  to pay to the Trustee  any amount due it under  Section
9.7.

         (d) All rights of action and of asserting  claims under this Indenture,
or under  any of the  terms  established  with  respect  to  Debentures,  may be
enforced by the Trustee without the possession of any of such Debentures, or the
production  thereof at any trial or other proceeding  relative thereto,  and any

<PAGE>

such suit or  proceeding  instituted  by the Trustee shall be brought in its own
name as trustee of an express trust,  and any recovery of judgment shall,  after
provision  for payment to the Trustee of any amounts due under  Section  9.7, be
for the ratable benefit of the holders of the Debentures. In case of an Event of
Default  hereunder,  the  Trustee may in its  discretion  proceed to protect and
enforce the rights vested in it by this Indenture by such  appropriate  judicial
proceedings  as the Trustee shall deem most effectual to protect and enforce any
of such  rights,  either  at law or in  equity or in  bankruptcy  or  otherwise,
whether for the specific  enforcement of any covenant or agreement  contained in
this Indenture or in aid of the exercise of any power granted in this Indenture,
or to enforce any other legal or  equitable  right vested in the Trustee by this
Indenture or by law.  Nothing  contained herein shall be deemed to authorize the
Trustee  to  authorize  or  consent  to or  accept  or  adopt on  behalf  of any
Debentureholder   any  plan  of  reorganization,   arrangement,   adjustment  or
composition  affecting the  Debentures or the rights of any holder thereof or to
authorize the Trustee to vote in respect of the claim of any  Debentureholder in
any such proceeding.

Section 7.3.      Application of Moneys Collected.

         Any moneys  collected by the Trustee  pursuant to this Article VII with
respect to the Debentures  shall be applied in the following  order, at the date
or dates fixed by the Trustee and, in case of the distribution of such moneys on
account of principal or  interest,  upon  presentation  of the  Debentures,  and
notation thereon the payment, if only partially paid, and upon surrender thereof
if fully paid:

                  FIRST:  To the payment of costs and expenses of collection and
         of all amounts  payable to the Trustee under Section 9.7;

                  SECOND:  To  the  payment  of all Senior  Indebtedness  of the
         Company if and to the extent required by Article XVI; and

                  THIRD:  To the payment of the amounts then due and unpaid upon
         the Debentures  for principal and interest,  in respect of which or for
         the benefit of which such money has been  collected,  ratably,  without
         preference  or priority of any kind,  according  to the amounts due and
         payable on such Debentures for principal and interest, respectively.

Section 7.4.      Limitation on Suits.

         (a) No holder  of any  Debenture  shall  have any right by virtue or by
availing of any  provision of this  Indenture to institute  any suit,  action or
proceeding  in equity or at law upon or under or with respect to this  Indenture
or for the  appointment  of a  receiver  or  trustee,  or for any  other  remedy
hereunder,  unless (i) such  holder  previously  shall have given to the Trustee
written  notice  of an Event of  Default  and of the  continuance  thereof  with
respect to the  Debentures  specifying  such Event of Default,  as  hereinbefore
provided; (ii) the holders of not less than 25% in aggregate principal amount of
the Debentures then Outstanding shall have made written request upon the Trustee
to  institute  such  action,  suit  or  proceeding  in its own  name as  trustee
hereunder;  (iii) such holder or holders  shall have offered to the Trustee such
reasonable  indemnity  as  it  may  require  against  the  costs,  expenses  and
liabilities to be incurred therein or thereby;  and (iv) the Trustee for 60 days
after its receipt of such  notice,  request and offer of  indemnity,  shall have

<PAGE>

failed to institute any such action, suit or proceeding;  and (v) during such 60
day period,  the holders of a majority in principal  amount of the Debentures do
not give the Trustee a direction inconsistent with the request.

         (b)  Notwithstanding  anything  contained herein to the contrary or any
other provisions of this Indenture, the right of any holder of the Debentures to
receive payment of the principal of and interest on the  Debentures,  as therein
provided,  on or after the respective due dates  expressed in such Debenture (or
in the case of redemption, on the redemption date), or to institute suit for the
enforcement of any such payment on or after such respective  dates or redemption
date,  shall not be impaired or affected  without the consent of such holder and
by  accepting a Debenture  hereunder it is  expressly  understood,  intended and
covenanted  by the taker and holder of every  Debenture  with  every  other such
taker and  holder and the  Trustee,  that no one or more  holders of  Debentures
shall have any right in any manner  whatsoever  by virtue or by  availing of any
provision of this  Indenture to affect,  disturb or prejudice  the rights of the
holders of any other of such Debentures, or to obtain or seek to obtain priority
over or preference to any other such holder,  or to enforce any right under this
Indenture,  except in the manner herein provided and for the equal,  ratable and
common benefit of all holders of Debentures.  For the protection and enforcement
of the  provisions of this Section 7.4, each and every  Debentureholder  and the
Trustee  shall be entitled  to such  relief as can be given  either at law or in
equity.

Section 7.5.      Rights and Remedies Cumulative; Delay or Omission not Waiver.

         (a)  Except as  otherwise  provided  in  Section  2.9,  all  powers and
remedies  given by this  Article VII to the  Trustee or to the  Debentureholders
shall, to the extent permitted by law, be deemed cumulative and not exclusive of
any other  powers and  remedies  available  to the Trustee or the holders of the
Debentures,  by judicial proceedings or otherwise, to enforce the performance or
observance  of the  covenants  and  agreements  contained  in this  Indenture or
otherwise established with respect to such Debentures.

         (b) No delay or  omission of the Trustee or of any holder of any of the
Debentures  to exercise  any right or power  accruing  upon any Event of Default
occurring and continuing as aforesaid  shall impair any such right or power,  or
shall  be  construed  to be a  waiver  of any such  default  or on  acquiescence
therein;  and,  subject to the provisions of Section 7.4, every power and remedy
given by this Article VII or by law to the Trustee or the  Debentureholders  may
be exercised  from time to time, and as often as shall be deemed  expedient,  by
the Trustee or by the Debentureholders.

Section 7.6.      Control by Debentureholders.

         The  holders  of a  majority  in  aggregate  principal  amount  of  the
Debentures at the time Outstanding,  determined in accordance with Section 10.4,
shall have the right to direct  the time,  method  and place of  conducting  any
proceeding for any remedy  available to the Trustee,  or exercising any trust or
power conferred on the Trustee; provided, however, that such direction shall not
be in  conflict  with any rule of law or with  this  Indenture.  Subject  to the
provisions of Section 9.1, the Trustee shall have the right to decline to follow
any such direction if the Trustee in good faith shall, by a Responsible  Officer
or Officers of the Trustee,  determine  that the  proceeding  so directed  would
involve  the  Trustee in  personal  liability.  The  holders  of a  majority  in

<PAGE>

aggregate  principal amount of the Debentures at the time  Outstanding  affected
thereby,  determined  in  accordance  with  Section  10.4,  may on behalf of the
holders of all of the  Debentures  waive any past default in the  performance of
any of the covenants contained herein and its consequences, except (i) a default
in the payment of the principal of or interest on, any of the  Debentures as and
when the same shall become due by the terms of such Debentures otherwise than by
acceleration (unless such default has been cured and a sum sufficient to pay all
matured  installments  of interest and  principal  has been  deposited  with the
Trustee (in  accordance  with Section  7.1(c));  (ii) a default in the covenants
contained in Section 5.6; or (iii) in respect of a covenant or provision  hereof
which  cannot be modified  or amended  without the consent of the holder of each
Outstanding  Debenture affected;  provided,  however, that if the Debentures are
held by the Trust or a trustee of the Trust, such waiver or modification to such
waiver  shall not be  effective  until the holders of a majority in  liquidation
preference of Trust  Securities of the Trust shall have consented to such waiver
or modification  to such waiver;  provided  further,  that if the consent of the
holder of each  Outstanding  Debenture  is  required,  such waiver  shall not be
effective  until each  holder of the Trust  Securities  of the Trust  shall have
consented to such  waiver.  Upon any such waiver,  the default  covered  thereby
shall be deemed to be cured for all purposes of this  Indenture and the Company,
the Trustee and the holders of the Debentures  shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend to
any subsequent or other default or impair any right consequent thereon.

Section 7.7.      Undertaking to Pay Costs.

         All parties to this Indenture  agree, and each holder of any Debentures
by such holder's  acceptance  thereof  shall be deemed to have agreed,  that any
court may in its  discretion  require,  in any suit for the  enforcement  of any
right or remedy under this Indenture, or in any suit against the Trustee for any
action  taken or omitted by it as Trustee,  the filing by any party  litigant in
such suit of an  undertaking  to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs,  including reasonable  attorneys'
fees,  against any party litigant in such suit,  having due regard to the merits
and good faith of the claims or defenses  made by such party  litigant;  but the
provisions  of this  Section 7.8 shall not apply to any suit  instituted  by the
Trustee,   to  any  suit  instituted  by  any   Debentureholder,   or  group  of
Debentureholders  holding  more than 10% in  aggregate  principal  amount of the
Outstanding Debentures, or to any suit instituted by any Debentureholder for the
enforcement of the payment of the principal of or interest on the Debentures, on
or after the  respective  due dates  expressed in such  Debenture or established
pursuant to this Indenture.


                                  ARTICLE VIII.
                      FORM OF DEBENTURE AND ORIGINAL ISSUE

Section 8.1.      Form of Debenture.

         The Debenture and the Trustee's  Certificate  of  Authentication  to be
endorsed  thereon are to be  substantially  in the forms  contained as Exhibit A
attached hereto and incorporated herein by reference.
<PAGE>

Section 8.2.      Original Issue of Debentures.

         Debentures in the aggregate  principal  amount of $88,917,550 may, upon
execution  of this  Indenture,  be executed by the Company and  delivered to the
Trustee for  authentication,  and the Trustee shall thereupon  authenticate  and
deliver said  Debentures to or upon the written order of the Company,  signed by
its Chairman,  its Vice Chairman,  its President,  or any Vice President and its
Treasurer or an Assistant Treasurer, without any further action by the Company.


                                   ARTICLE IX.
                             CONCERNING THE TRUSTEE

Section 9.1.      Certain Duties and Responsibilities Trustee.

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

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

                  (1) prior to the  occurrence  of an Event of Default and after
         the  curing or  waiving  of all such  Events of  Default  that may have
         occurred:

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

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

                  (2) the Trustee  shall not be liable for any error of judgment
         made in good faith by a Responsible Officer or Responsible  Officers of
         the Trustee,  unless it shall be proved that the Trustee was  negligent
         in ascertaining the pertinent facts;
<PAGE>

                  (3) the 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  principal
         amount of the Debentures at the time Outstanding  relating to the time,
         method and place of conducting any proceeding for any remedy  available
         to the Trustee,  or exercising  any trust or power  conferred  upon the
         Trustee under this Indenture with respect to the Debentures; and

                  (4) none of the provisions  contained in this Indenture  shall
         require the Trustee to expend or risk its own funds or otherwise  incur
         personal financial liability in the performance of any of its duties or
         in the exercise of any of its rights or powers,  if there is reasonable
         ground for  believing  that the repayment of such funds or liability is
         not  reasonably  assured  to it under  the terms of this  Indenture  or
         adequate indemnity against such risk is not reasonably assured to it.

Section 9.2.      Notice of Defaults.

         Within 90 days after actual  knowledge by a Responsible  Officer of the
Trustee  of  the  occurrence  of  any  default  hereunder  with  respect  to the
Securities, the Trustee shall transmit by mail to all holders of the Debentures,
as their names and addresses  appear in the Debenture  Register,  notice of such
default, unless such default shall have been cured or waived; provided, however,
that,  except in the case  default in the payment of the  principal  or interest
(including  any  Additional  Interest) on any  Debenture,  the Trustee  shall be
protected in  withholding  such notice if and so long as the board of directors,
the executive committee or a trust committee of the directors and/or Responsible
Officers of the Trustee  determines in good faith that the  withholding  of such
notice is in the  interests  of the holders of such  Debentures;  and  provided,
further,  that in the case of any default of the character  specified in section
7.1(a)(iii), no such notice to holders of Debentures need be sent until at least
30 days after the occurrence thereof.  For the purposes of this Section 9.2, the
term  "default"  means any event  which is, or after  notice or lapse of time or
both, would become, an Event of Default with respect to the Debentures.

Section 9.3.      Certain Rights of Trustee.

         Except as otherwise provided in Section 9.1:

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

         (b) Any request,  direction,  order or demand of the Company  mentioned
herein shall be  sufficiently  evidenced by a Board  Resolution or an instrument
signed in the name of the Company by the President or any Vice  President and by
the  Secretary  or an  Assistant  Secretary  or the  Treasurer  or an  Assistant
Treasurer  thereof  (unless other  evidence in respect  thereof is  specifically
prescribed herein);

         (c) The Trustee  shall not be deemed to have  knowledge of a default or
an Event  of  Default,  other  than an Event of  Default  specified  in  Section
7.1(a)(i);  or (ii),  unless and until it receives written  notification of such

<PAGE>

Event of Default from the Company or by holders of at least 25% of the aggregate
principal amount of the Debentures at the time Outstanding;

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

         (e) The Trustee  shall be under no  obligation  to exercise  any of the
rights  or  powers  vested  in it by this  Indenture  at the  request,  order or
direction of any of the  Debentureholders,  pursuant to the  provisions  of this
Indenture,  unless  such  Debentureholders  shall have  offered  to the  Trustee
reasonable  security or indemnity  against the costs,  expenses and  liabilities
that may be  incurred  therein  or  thereby;  nothing  contained  herein  shall,
however, relieve the Trustee of the obligation,  upon the occurrence of an Event
of Default  (that has not been cured or waived) to exercise  with respect to the
Debentures such of the rights and powers vested in it by this Indenture,  and to
use the same degree of care and skill in their exercise,  as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs;

         (f) The Trustee  shall not be liable for any action taken or omitted to
be taken by it in good faith and believed by it to be  authorized  or within the
discretion or rights or powers conferred upon it by this Indenture;

         (g) The Trustee shall not be bound to make any  investigation  into the
facts or matters stated in any resolution,  certificate,  statement, instrument,
opinion,  report, notice, request,  consent, order, approval, bond, security, or
other papers or documents,  unless  requested in writing so to do by the holders
of not less than a majority in principal  amount of the  Outstanding  Debentures
(determined as provided in Section 10.4); provided, however, that if the payment
within a reasonable  time to the Trustee of the costs,  expenses or  liabilities
likely  to be  incurred  by it in the  making of such  investigation  is, in the
opinion of the Trustee,  not  reasonably  assured to the Trustee by the security
afforded  to it by  the  terms  of  this  Indenture,  the  Trustee  may  require
reasonable indemnity against such costs,  expenses or liabilities as a condition
to so proceeding. The reasonable expense of every such examination shall be paid
by the Company or, if paid by the  Trustee,  shall be repaid by the Company upon
demand; and

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

Section 9.4.      Trustee Not Responsible for Recitals, etc.

         (a) The Recitals  contained herein and in the Debentures shall be taken
as the statements of the Company,  and the Trustee assumes no responsibility for
the correctness of the same.

          (b)  The  Trustee  makes  no  representations  as to the  validity  or
sufficiency of this Indenture or of the Debentures.
<PAGE>

         (c) The Trustee shall not be accountable  for the use or application by
the Company of any of the Debentures or of the proceeds of such  Debentures,  or
for the use or  application of any moneys paid over by the Trustee in accordance
with any  provision  of this  Indenture,  or for the use or  application  of any
moneys received by any paying agent other than the Trustee.

Section 9.5.      May Hold Debentures.

         The Trustee or any paying agent or registrar for the Debentures, in its
individual or any other capacity,  may become the owner or pledgee of Debentures
with the same  rights  it would  have if it were not  Trustee,  paying  agent or
Debenture Registrar.

Section 9.6.      Moneys Held in Trust.

         Subject to the provisions of Section 13.5,  all moneys  received by the
Trustee shall,  until used or applied as herein  provided,  be held in trust for
the purposes for which they were received, but need not be segregated from other
funds  except to the  extent  required  by law.  The  Trustee  shall be under no
liability for interest on any moneys received by it hereunder  except such as it
may agree with the Company to pay thereon.

Section 9.7.      Compensation and Reimbursement.

         (a) The Company  covenants  and agrees to pay to the  Trustee,  and the
Trustee shall be entitled to, such reasonable  compensation  (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express  trust),  as the  Company and the Trustee may from time to time agree in
writing,  for all services  rendered by it in the execution of the trusts hereby
created  and in the  exercise  and  performance  of any of the powers and duties
hereunder of the Trustee,  and, except as otherwise  expressly  provided herein,
the  Company  shall  pay or  reimburse  the  Trustee  upon its  request  for all
reasonable expenses,  disbursements and advances incurred or made by the Trustee
in  accordance  with any of the  provisions  of this  Indenture  (including  the
reasonable compensation and the expenses and disbursements of its counsel and of
all Persons not regularly in its employ)  except any such expense,  disbursement
or advance as may arise from its  negligence  or bad  faith.  The  Company  also
covenants to indemnify  the Trustee (and its  officers,  agents,  directors  and
employees) for, and to hold it harmless against,  any loss, liability or expense
incurred without  negligence or bad faith on the part of the Trustee and arising
out of or in connection  with the  acceptance or  administration  of this trust,
including  the costs and  expenses  of  defending  itself  against  any claim of
liability in the premises.

         (b) The obligations of the Company under this Section 9.7 to compensate
and  indemnify  the Trustee and to pay or  reimburse  the Trustee for  expenses,
disbursements and advances shall constitute additional  indebtedness  hereunder.
Such  additional  indebtedness  shall be  secured by a lien prior to that of the
Debentures upon all property and funds held or collected by the Trustee as such,
except  funds  held in  trust  for the  benefit  of the  holders  of  particular
Debentures.

Section 9.8.      Reliance on Officers' Certificate.

         Except  as  otherwise   provided  in  Section  9.1,   whenever  in  the
administration  of the  provisions  of this  Indenture the Trustee shall deem it

<PAGE>

necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting to take any action  hereunder,  such matter  (unless other
evidence  in respect  thereof be herein  specifically  prescribed)  may,  in the
absence of negligence  or bad faith on the part of the Trustee,  be deemed to be
conclusively proved and established by an Officers' Certificate delivered to the
Trustee and such  certificate,  in the absence of negligence or bad faith on the
part of the Trustee,  shall be full warrant to the Trustee for any action taken,
suffered  or omitted to be taken by it under the  provisions  of this  Indenture
upon the faith thereof.

Section 9.9.      Disqualification:  Conflicting Interests.

         If the Trustee has or shall acquire any  "conflicting  interest" within
the meaning of Section  310(b) of the Trust  Indenture  Act, the Trustee and the
Company shall in all respects  comply with the  provisions of Section  310(b) of
the Trust Indenture Act.

Section 9.10.     Corporate Trustee Required; Eligibility.

         There shall at all times be a Trustee  with  respect to the  Debentures
issued  hereunder which shall at all times be a corporation  organized and doing
business  under  the  laws of the  United  States  of  America  or any  State or
Territory  thereof or of the District of  Columbia,  or a  corporation  or other
Person permitted to act as trustee by the Commission, authorized under such laws
to exercise corporate trust powers,  having a combined capital and surplus of at
least $50,000,000,  and subject to supervision or examination by federal, state,
territorial,  or District of Columbia authority.  If such corporation  publishes
reports of condition at least annually,  pursuant to law or to the  requirements
of the aforesaid  supervising or examining  authority,  then for the purposes of
this Section 9.10, 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.  The  Company  may not,  nor may any Person
directly or indirectly controlling,  controlled by, or under common control with
the Company, serve as Trustee. In case at any time the Trustee shall cease to be
eligible in accordance  with the  provisions  of this Section 9.10,  the Trustee
shall resign  immediately in the manner and with the effect specified in Section
9.11.

Section 9.11.     Resignation and Removal; Appointment of Successor.

         (a) The Trustee or any successor hereafter  appointed,  may at any time
resign by giving  written  notice  thereof to the  Company  and by  transmitting
notice  of  resignation   by  mail,   first  class  postage   prepaid,   to  the
Debentureholders,  as their  names  and  addresses  appear  upon  the  Debenture
Register. Upon receiving such notice of resignation,  the Company shall promptly
appoint a successor trustee with respect to Debentures by written instrument, in
duplicate,  executed  by order  of the  Board  of  Directors,  one copy of which
instrument  shall be  delivered  to the  resigning  Trustee  and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted  appointment  within  30 days  after  the  mailing  of such  notice  of
resignation,   the  resigning  Trustee  may  petition  any  court  of  competent
jurisdiction  for  the  appointment  of a  successor  trustee  with  respect  to
Debentures,  or  any  Debentureholder  who  has  been a bona  fide  holder  of a
Debenture or Debentures  for at least six months may,  subject to the provisions
of Section 9.9, on behalf of himself and all others similarly situated, petition

<PAGE>

any such  court for the  appointment  of a  successor  trustee.  Such  court may
thereupon  after such  notice,  if any,  as it may deem  proper  and  prescribe,
appoint a successor trustee.

         (b)  In case at any time any one of the following shall occur

                  (i) the Trustee  shall fail to comply with the  provisions  of
         Section  9.9 after  written  request  therefor by the Company or by any
         Debentureholder  who has been a bona  fide  holder  of a  Debenture  or
         Debentures for at least six months; or

                  (ii) the Trustee shall cease to be eligible in accordance with
         the  provisions  of Section 9.10 and shall fail to resign after written
         request therefor by the Company or by any such Debentureholder; or

                  (iii) the Trustee shall become  incapable of acting,  or shall
         be adjudged a bankrupt or insolvent, or commence a voluntary bankruptcy
         proceeding,  or a receiver of the Trustee or of its  property  shall be
         appointed or consented  to, or any public  officer shall take charge or
         control of the Trustee or of its property or affairs for the purpose of
         rehabilitation,  conservation or  liquidation,  then, in any such case,
         the Company may remove the Trustee with respect to all  Debentures  and
         appoint a  successor  trustee  by  written  instrument,  in  duplicate,
         executed  by  order  of the  Board  of  Directors,  one  copy of  which
         instrument shall be delivered to the Trustee so removed and one copy to
         the successor  trustee,  or,  subject to the provisions of Section 9.9,
         unless the Trustee's duty to resign is stayed as provided  herein,  any
         Debentureholder  who has been a bona  fide  holder  of a  Debenture  or
         Debentures  for at least six months  may,  on behalf of that holder and
         all  others  similarly  situated,   petition  any  court  of  competent
         jurisdiction  for the removal of the Trustee and the  appointment  of a
         successor trustee.  Such court may thereupon after such notice, if any,
         as it may deem proper and  prescribe,  remove the Trustee and appoint a
         successor trustee.

         (c) The  holders of a majority  in  aggregate  principal  amount of the
Debentures  at the time  Outstanding  may at any time  remove the  Trustee by so
notifying  the Trustee and the Company and may appoint a successor  Trustee with
the consent of the Company.

         (d) Any  resignation  or removal of the  Trustee and  appointment  of a
successor  trustee  with  respect  to  the  Debentures  pursuant  to  any of the
provisions  of this Section  9.11 shall  become  effective  upon  acceptance  of
appointment by the successor trustee as provided in Section 9.12.

         (e) Any successor trustee  appointed  pursuant to this Section 9.11 may
be appointed with respect to the Debentures, and at any time there shall be only
one Trustee with respect to the Debentures.

Section 9.12.     Acceptance of Appointment by Successor.

         (a) In case of the  appointment  hereunder of a successor  trustee with
respect to the Debentures,  every successor  trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting  such  appointment,  and thereupon the  resignation  or removal of the
retiring Trustee shall become effective and such successor trustee,  without any

<PAGE>

further  act,  deed or  conveyance,  shall  become  vested  with all the rights,
powers,  trusts and duties of the retiring  Trustee;  but, on the request of the
Company or the successor  trustee,  such retiring Trustee shall, upon payment of
its charges,  execute and deliver an instrument  transferring  to such successor
trustee all the rights,  powers,  and trusts of the  retiring  Trustee and shall
duly  assign,  transfer and deliver to such  successor  trustee all property and
money held by such retiring Trustee hereunder.

         (b) Upon request of any  successor  trustee,  the Company shall execute
any and all instruments  for more fully and certainly  vesting in and confirming
to such  successor  trustee all such  rights,  powers and trusts  referred to in
paragraph (a) of this Section 9.12.

         (c) No successor  trustee  shall accept its  appointment  unless at the
time of such acceptance  such successor  trustee shall be qualified and eligible
under this Article IX.

         (d) Upon  acceptance of appointment by a successor  trustee as provided
in this Section 9.12,  the Company shall  transmit  notice of the  succession of
such  trustee   hereunder  by  mail,  first  class  postage   prepaid,   to  the
Debentureholders,  as their  names  and  addresses  appear  upon  the  Debenture
Register.  If the Company  fails to transmit  such notice  within ten days after
acceptance of appointment by the successor trustee,  the successor trustee shall
cause such notice to be transmitted at the expense of the Company.

Section 9.13.     Merger, Conversion, Consolidation or Succession to Business.

         Any  corporation  into which the Trustee may be merged or  converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion  or  consolidation  to which  the  Trustee  shall be a party,  or any
corporation  succeeding to the corporate trust business of the Trustee, shall be
the successor of the Trustee hereunder,  provided that such corporation shall be
qualified  under the provisions of Section 9.9 and eligible under the provisions
of Section 9.10, without the execution or filing of any paper or any further act
on the  part of any of the  parties  hereto,  anything  herein  to the  contrary
notwithstanding.  In case any Debentures shall have been authenticated,  but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such  authenticating  Trustee may adopt such authentication and
deliver  the  Debentures  so  authenticated  with  the  same  effect  as if such
successor Trustee had itself authenticated such Debentures.

Section 9.14.     Preferential Collection of Claims Against the Company.

         The Trustee  shall  comply with Section  311(a) of the Trust  Indenture
Act,  excluding  any creditor  relationship  described in Section  311(b) of the
Trust Indenture Act. A Trustee who has resigned or been removed shall be subject
to Section 311(a) of the Trust Indenture Act to the extent included therein.


                                   ARTICLE X.
                         CONCERNING THE DEBENTUREHOLDERS

Section 10.1.     Evidence of Action by Holders.

         (a)  Whenever in this  Indenture  it is provided  that the holders of a
majority or specified percentage in aggregate principal amount of the Debentures

<PAGE>

may take any action  (including the making of any demand or request,  the giving
of any notice,  consent or waiver or the taking of any other  action),  the fact
that at the time of taking any such  action  the  holders  of such  majority  or
specified  percentage  have joined therein may be evidenced by any instrument or
any  number  of  instruments  of  similar  tenor  executed  by such  holders  of
Debentures in Person or by agent or proxy appointed in writing.

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

Section 10.2.     Proof of Execution by Debentureholders.

         Subject to the provisions of Section 9.1, proof of the execution of any
instrument by a Debentureholder  (such proof shall not require  notarization) or
his  agent or  proxy  and  proof  of the  holding  by any  Person  of any of the
Debentures shall be sufficient if made in the following manner:

         (a) The fact  and  date of the  execution  by any  such  Person  of any
instrument may be proved in any reasonable manner acceptable to the Trustee.

         (b) The  ownership  of  Debentures  shall be  proved  by the  Debenture
Register of such  Debentures  or by a  certificate  of the  Debenture  Registrar
thereof.

          (c) The  Trustee  may  require  such  additional  proof of any  matter
referred to in this Section 10.2 as it shall deem necessary.

Section 10.3.     Who May be Deemed Owners.

         Prior  to the due  presentment  for  registration  of  transfer  of any
Debenture,  the Company, the Trustee, any paying agent, any Authenticating Agent
and any  Debenture  Registrar  may deem and treat the  Person in whose name such
Debenture  shall be  registered  upon the books of the  Company as the  absolute
owner of such  Debenture  (whether  or not such  Debenture  shall be overdue and
notwithstanding  any notice of ownership or writing thereon made by anyone other
than the  Debenture  Registrar)  for the purpose of  receiving  payment of or on
account of the principal of and interest on such  Debenture  (subject to Section
2.3) and for all other purposes; and neither the Company nor the Trustee nor any
paying agent nor any Authenticating  Agent nor any Debenture  Registrar shall be
affected by any notice to the contrary.
<PAGE>

Section 10.4.     Certain Debentures Owned by Company Disregarded.

         In determining whether the holders of the requisite aggregate principal
amount of Debentures  have concurred in any  direction,  consent or waiver under
this  Indenture,  the  Debentures  that are  owned by the  Company  or any other
obligor on the Debentures or by any Person directly or indirectly controlling or
controlled  by or under common  control with the Company or any other obligor on
the  Debentures  shall be disregarded  and deemed not to be Outstanding  for the
purpose of any such  determination,  except that for the purpose of  determining
whether the Trustee shall be protected in relying on any such direction, consent
or waiver, only Debentures that the Trustee actually knows are so owned shall be
so disregarded. The Debentures so owned that have been pledged in good faith may
be regarded as Outstanding for the purposes of this Section 10.4, if the pledgee
shall establish to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Debentures and that the pledgee is not a Person directly or
indirectly  controlling  or  controlled  by or under  direct or indirect  common
control with the Company or any such other  obligor.  In case of a dispute as to
such right,  any decision by the Trustee  taken upon the advice of counsel shall
be full protection to the Trustee.

Section 10.5.     Actions Binding on Future Debentureholders.

         At any time prior to (but not after) the evidencing to the Trustee,  as
provided  in Section  10.1,  of the  taking of any action by the  holders of the
majority or percentage in aggregate principal amount of the Debentures specified
in this Indenture in connection with such action, any holder of a Debenture that
is shown by the evidence to be included in the  Debentures  the holders of which
have  consented to such action may, by filing  written  notice with the Trustee,
and upon proof of holding as provided in Section 10.2, revoke such action so far
as concerns  such  Debenture.  Except as aforesaid  any such action taken by the
holder of any  Debenture  shall be  conclusive  and binding upon such holder and
upon all future  holders  and  owners of such  Debenture,  and of any  Debenture
issued in exchange  therefor,  on registration  of transfer  thereof or in place
thereof,  irrespective  of whether or not any notation in regard thereto is made
upon  such  Debenture.  Any  action  taken by the  holders  of the  majority  or
percentage in aggregate  principal  amount of the  Debentures  specified in this
Indenture in connection with such action shall be conclusively  binding upon the
Company, the Trustee and the holders of all the Debentures.


                                   ARTICLE XI.
                             SUPPLEMENTAL INDENTURES

Section 11.1.   Supplemental Indentures Without the Consent of Debentureholders.

         In addition to any supplemental  indenture otherwise authorized by this
Indenture,  the  Company  and the  Trustee may from time to time and at any time
enter into an indenture or indentures  supplemental  hereto (which shall conform
to the  provisions of the Trust  Indenture  Act as then in effect),  without the
consent of the Debentureholders, for one or more of the following purposes:
<PAGE>

          (a) to cure any ambiguity,  defect,  or inconsistency  herein,  in the
Debentures;

          (b) to comply with Article X;

          (c) to provide  for  uncertificated  Debentures  in  addition to or in
place of certificated Debentures;

          (d) to add to the  covenants  of the  Company  for the  benefit of the
holders  of all or any of the  Debentures  or to  surrender  any  right or power
herein conferred upon the Company;

          (e) to add to, delete from, or revise the conditions, limitations, and
restrictions   on  the  authorized   amount,   terms,   or  purposes  of  issue,
authentication, and delivery of Debentures, as herein set forth;

          (f) to make any change  that does not  adversely  affect the rights of
any Debentureholder in any material respect;

          (g) to provide for the  issuance of and  establish  the form and terms
and conditions of the  Debentures,  to establish the form of any  certifications
required  to be  furnished  pursuant  to the terms of this  Indenture  or of the
Debentures, or to add to the rights of the holders of the Debentures; or

          (h) qualify or maintain the  qualification of this Indenture under the
Trust Indenture Act.

The Trustee is hereby  authorized  to join with the Company in the  execution of
any such supplemental indenture,  and to make any further appropriate agreements
and  stipulations  that may be therein  contained,  but the Trustee shall not be
obligated  to enter  into any  such  supplemental  indenture  that  affects  the
Trustee's own rights,  duties or immunities  under this  Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this Section 11.1 may
be executed by the Company and the Trustee without the consent of the holders of
any of  the  Debentures  at the  time  Outstanding,  notwithstanding  any of the
provisions of Section 11.2.

Section 11.2.     Supplemental Indentures with Consent of Debentureholders.

         With the consent (evidenced as provided in Section 10.1) of the holders
of not less than a majority in aggregate  principal  amount of the Debentures at
the time Outstanding, the Company, when authorized by Board Resolutions, and the
Trustee  may from  time to time  and at any  time  enter  into an  indenture  or
indentures  supplemental  hereto (which shall  conform to the  provisions of the
Trust  Indenture Act as then in effect) for the purpose of adding any provisions
to or  changing  in any  manner or  eliminating  any of the  provisions  of this
Indenture  or of any  supplemental  indenture  or of modifying in any manner not
covered by Section 11.1 the rights of the holders of the  Debentures  under this
Indenture;  provided, however, that no such supplemental indenture shall without
the consent of the  holders of each  Debenture  then  Outstanding  and  affected
thereby,  (i) extend the fixed maturity of any Debentures,  reduce the principal
amount  thereof,  or reduce the rate or extend  the time of payment of  interest
thereon,  without the consent of the holder of each  Debenture so  affected;  or
(ii) reduce the  aforesaid  percentage of  Debentures,  the holders of which are
required to consent to any such supplemental  indenture;  provided further, that

<PAGE>

if the  Debentures  are  held by the  Trust  or a  trustee  of the  Trust,  such
supplemental indenture shall not be effective until the holders of a majority in
liquidation  preference of Trust Securities of the Trust shall have consented to
such supplemental indenture; provided further, that if the consent of the holder
of each Outstanding Debenture is required, such supplemental indenture shall not
be effective  until each holder of the Trust  Securities of the Trust shall have
consented to such  supplemental  indenture.  It shall not be  necessary  for the
consent of the  Debentureholders  affected  thereby  under this  Section 11.2 to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such consent shall approve the substance thereof.

Section 11.3.     Effect of Supplemental Indentures.

         Upon  the  execution  of any  supplemental  indenture  pursuant  to the
provisions  of this  Article  XI,  this  Indenture  shall be and be deemed to be
modified  and  amended  in  accordance  therewith  and  the  respective  rights,
limitations of rights,  obligations,  duties and immunities under this Indenture
of the Trustee,  the Company and the holders of Debentures  shall  thereafter be
determined,  exercised  and enforced  hereunder  subject in all respects to such
modifications  and  amendments,  and all the  terms and  conditions  of any such
supplemental  indenture  shall  be and be  deemed  to be part of the  terms  and
conditions of this Indenture for any and all purposes.

Section 11.4.     Debentures Affected by Supplemental Indentures.

         Debentures  affected by a  supplemental  indenture,  authenticated  and
delivered  after the execution of such  supplemental  indenture  pursuant to the
provisions  of this  Article  XI, may bear a notation  in form  approved  by the
Company,  provided such form meets the  requirements  of any exchange upon which
the Debentures may be listed, as to any matter provided for in such supplemental
indenture.  If the Company shall so determine,  new Debentures so modified as to
conform,  in the  opinion  of the  Board of  Directors  of the  Company,  to any
modification of this Indenture contained in any such supplemental  indenture may
be prepared by the  Company,  authenticated  by the  Trustee  and  delivered  in
exchange for the Debentures then Outstanding.

Section 11.5.     Execution of Supplemental Indentures.

         (a)  Upon the  request  of the  Company,  accompanied  by  their  Board
Resolutions  authorizing the execution of any such supplemental  indenture,  and
upon the filing with the Trustee of evidence of the consent of  Debentureholders
required  to  consent  thereto as  aforesaid,  the  Trustee  shall join with the
Company in the execution of such supplemental indenture unless such supplemental
indenture  affects the  Trustee's own rights,  duties or  immunities  under this
Indenture  or  otherwise,  in which case the Trustee may in its  discretion  but
shall not be obligated to enter into such supplemental  indenture.  The Trustee,
subject to the  provisions of Sections 9.1, may receive an Opinion of Counsel as
conclusive  evidence that any supplemental  indenture  executed pursuant to this
Article XI is  authorized  or  permitted  by, and conforms to, the terms of this
Article XI and that it is proper for the Trustee  under the  provisions  of this
Article XI to join in the execution thereof.

         (b) Promptly  after the execution by the Company and the Trustee of any
supplemental  indenture  pursuant to the  provisions of this Section  11.5,  the
Trustee shall transmit by mail, first class postage prepaid,  a notice,  setting

<PAGE>

forth in general  terms the  substance of such  supplemental  indenture,  to the
Debentureholders  as  their  names  and  addresses  appear  upon  the  Debenture
Register. Any failure of the Trustee to mail such notice, or any defect therein,
shall  not,  however,  in any way  impair or  affect  the  validity  of any such
supplemental indenture.


                                  ARTICLE XII.
                              SUCCESSOR CORPORATION

Section 12.1.     Company May Consolidate, etc.

         Nothing  contained in this Indenture or in any of the Debentures  shall
prevent  any  consolidation  or  merger  of the  Company  with or into any other
corporation or corporations  (whether or not affiliated with the Company, as the
case may be), or successive  consolidations or mergers in which the Company,  as
the case may be, or its successor or successors shall be a party or parties,  or
shall  prevent  any  sale,  conveyance,  transfer  or other  disposition  of the
property of the Company,  as the case may be, or its  successor or successors as
an entirety,  or substantially as an entirety, to any other corporation (whether
or not  affiliated  with the  Company,  as the case may be, or its  successor or
successors)  authorized to acquire and operate the same; provided,  however, the
Company  hereby  covenants  and agrees  that,  (i) upon any such  consolidation,
merger, sale,  conveyance,  transfer or other disposition,  the due and punctual
payment,  in the case of the Company, of the principal of and interest on all of
the  Debentures,  according to their tenor and the due and punctual  performance
and  observance of all the covenants and conditions of this Indenture to be kept
or performed by the Company as the case may be, shall be expressly  assumed,  by
supplemental  indenture  (which  shall  conform to the  provisions  of the Trust
Indenture Act, as then in effect)  satisfactory in form to the Trustee  executed
and delivered to the Trustee by the entity formed by such consolidation, or into
which the Company,  as the case may be, shall have been merged, or by the entity
which shall have acquired such property;  (ii) in case the Company  consolidates
with or merges into another  Person or conveys or transfers its  properties  and
assets  substantially then as an entirety to any Person, the successor Person is
organized  under the laws of the United  States or any state or the  District of
Columbia;  and  (iii)  immediately  after  giving  effect  thereto,  an Event of
Default, and no event which, after notice or lapse of time or both, would become
an Event of Default, shall have occurred and be continuing.

Section 12.2.     Successor Corporation Substituted.

         (a) In  case  of any  such  consolidation,  merger,  sale,  conveyance,
transfer  or  other  disposition  and  upon  the  assumption  by  the  successor
corporation,  by supplemental  indenture,  executed and delivered to the Trustee
and satisfactory in form to the Trustee, of, in the case of the Company, the due
and punctual  payment of the principal of and interest on all of the  Debentures
Outstanding  and the due and punctual  performance  of all of the  covenants and
conditions of this Indenture to be performed by the Company, as the case may be,
such successor  corporation shall succeed to and be substituted for the Company,
with the  same  effect  as if it had  been  named  as the  Company  herein,  and
thereupon the predecessor  corporation  shall be relieved of all obligations and
covenants under this Indenture and the Debentures.
<PAGE>

         (b) In  case  of any  such  consolidation,  merger,  sale,  conveyance,
transfer or other  disposition  such changes in phraseology and form (but not in
substance)  may be made in the  Debentures  thereafter  to be  issued  as may be
appropriate.

         (c) Nothing  contained in this  Indenture  or in any of the  Debentures
shall  prevent the Company  from merging into itself or acquiring by purchase or
otherwise  all or any part of the property of any other  Person  (whether or not
affiliated with the Company).

Section 12.3.     Evidence of Consolidation, etc. to Trustee.

         The Trustee,  subject to the  provisions of Section 9.1, may receive an
Opinion of Counsel as conclusive evidence that any such  consolidation,  merger,
sale, conveyance, transfer or other disposition, and any such assumption, comply
with the provisions of this Article XII.


                                  ARTICLE XIII.
                           SATISFACTION AND DISCHARGE

Section 13.1.     Satisfaction and Discharge of Indenture.

         If at any time: (a) the Company shall have delivered to the Trustee for
cancellation all Debentures theretofore authenticated (other than any Debentures
that shall have been destroyed, lost or stolen and that shall have been replaced
or paid as provided in Section 2.9) and  Debentures  for whose  payment money or
Governmental  Obligations have theretofore been deposited in trust or segregated
and held in  trust by the  Company  (and  thereupon  repaid  to the  Company  or
discharged  from such  trust,  as  provided  in Section  13.5);  or (b) all such
Debentures not theretofore  delivered to the Trustee for cancellation shall have
become due and payable,  or are by their terms to become due and payable  within
one year or are to be called for redemption  within one year under  arrangements
satisfactory  to the  Trustee  for the giving of notice of  redemption,  and the
Company shall  deposit or cause to be deposited  with the Trustee as trust funds
the  entire  amount  in  moneys  or  Governmental  Obligations  sufficient  or a
combination thereof,  sufficient in the opinion of a nationally  recognized firm
of independent public accountants  expressed in a written  certification thereof
delivered to the Trustee,  to pay at maturity or upon  redemption all Debentures
not theretofore  delivered to the Trustee for cancellation,  including principal
and  interest  due or to become due to such date of  maturity  or date fixed for
redemption, as the case may be, and if the Company shall also pay or cause to be
paid all other sums payable hereunder by the Company;  then this Indenture shall
thereupon  cease to be of further  effect except for the  provisions of Sections
2.3,  2.7,  2.9,  5.1,  5.2, 5.3 and 9.10,  that shall survive until the date of
maturity or redemption date, as the case may be, and Sections 9.6 and 13.5, that
shall  survive to such date and  thereafter,  and the Trustee,  on demand of the
Company  and at the  cost and  expense  of the  Company,  shall  execute  proper
instruments acknowledging satisfaction of and discharging this Indenture.

Section 13.2.     Discharge of Obligations.

         If at any time all Debentures  not heretofore  delivered to the Trustee
for cancellation or that have not become due and payable as described in Section
13.1 shall  have been paid by the  Company by  depositing  irrevocably  with the

<PAGE>

Trustee  as  trust  funds  moneys  or  an  amount  of  Governmental  Obligations
sufficient in the opinion of a nationally recognized certified public accounting
firm to pay at  maturity  or upon  redemption  all  Debentures  not  theretofore
delivered to the Trustee for cancellation,  including principal and interest due
or to become due to such date of maturity or date fixed for  redemption,  as the
case may be,  and if the  Company  shall  also pay or cause to be paid all other
sums  payable  hereunder  by the  Company,  then  after the date such  moneys or
Governmental  Obligations,  as the case may be, are deposited  with the Trustee,
the obligations of the Company under this Indenture shall cease to be of further
effect except for the  provisions of Sections 2.3, 2.7, 2.9, 5.1, 5.2, 5.3, 9.6,
9.10 and 13.5 hereof that shall survive until such  Debentures  shall mature and
be paid. Thereafter, Sections 9.6 and 13.5 shall survive.

Section 13.3.     Deposited Moneys to be Held in Trust.

         All  monies or  Governmental  Obligations  deposited  with the  Trustee
pursuant to Sections  13.1 or 13.2 shall be held in trust and shall be available
for payment as due, either  directly or through any paying agent  (including the
Company  acting as its own paying  agent),  to the holders of the Debentures for
the payment or redemption of which such moneys or Governmental  Obligations have
been deposited with the Trustee.

Section 13.4.     Payment of Monies Held by Paying Agents.

         In connection  with the  satisfaction  and discharge of this Indenture,
all moneys or Governmental  Obligations  then held by any paying agent under the
provisions of this Indenture shall,  upon demand of the Company,  be paid to the
Trustee  and  thereupon  such paying  agent  shall be released  from all further
liability with respect to such moneys or Governmental Obligations.

Section 13.5.     Repayment to Company.

         Any monies or Governmental  Obligations deposited with any paying agent
or the Trustee,  or then held by the Company in trust,  for payment of principal
of or interest on the  Debentures  that are not applied but remain  unclaimed by
the holders of such  Debentures for at least two years after the date upon which
the principal of or interest on such Debentures shall have  respectively  become
due and payable,  shall be repaid to the Company,  as the case may be, on May 31
of each  year or (if then held by the  Company)  shall be  discharged  from such
trust; and thereupon the paying agent and the Trustee shall be released from all
further liability with respect to such moneys or Governmental  Obligations,  and
the holder of any of the  Debentures  entitled  to receive  such  payment  shall
thereafter,  as an unsecured general creditor,  look only to the Company for the
payment thereof.


                                  ARTICLE XIV.
                IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
                                  AND DIRECTORS

Section 14.1.     No Recourse.

         No recourse under or upon any obligation, covenant or agreement of this
Indenture, or of the Debentures,  or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator,  stockholder, officer or

<PAGE>

director,  past, present or future as such, of the Company or of any predecessor
or  successor  corporation,  either  directly or through the Company or any such
predecessor  or successor  corporation,  whether by virtue of any  constitution,
statute or rule of law, or by the  enforcement  of any  assessment or penalty or
otherwise; it being expressly understood that this Indenture and the obligations
issued  hereunder are solely  corporate  obligations,  and that no such personal
liability  whatever  shall  attach  to,  or is or  shall  be  incurred  by,  the
incorporators, stockholders, officers or directors as such, of the Company or of
any  predecessor  or  successor  corporation,  or any of  them,  because  of the
creation of the  indebtedness  hereby  authorized,  or under or by reason of the
obligations,  covenants or agreements  contained in this  Indenture or in any of
the  Debentures  or  implied  therefrom;  and  that  any and all  such  personal
liability  of every  name and  nature,  either at common  law or in equity or by
constitution  or statute,  of, and any and all such  rights and claims  against,
every such  incorporator,  stockholder,  officer or director as such, because of
the creation of the indebtedness hereby authorized, or under or by reason of the
obligations,  covenants or agreements  contained in this  Indenture or in any of
the Debentures or implied therefrom, are hereby expressly waived and released as
a condition of, and as a consideration  for, the execution of this Indenture and
the issuance of such Debentures.


                                   ARTICLE XV.
                            MISCELLANEOUS PROVISIONS

Section 15.1.     Effect on Successors and Assigns.

         All  the  covenants,  stipulations,  promises  and  agreements  in this
Indenture  contained by or on behalf of the Company shall bind their  respective
successors and assigns, whether so expressed or not.

Section 15.2.     Actions by Successor.

         Any act or proceeding by any provision of this Indenture  authorized or
required  to be done or  performed  by any  board,  committee  or officer of the
Company  shall and may be done and  performed  with like force and effect by the
corresponding  board,  committee or officer of any corporation that shall at the
time be the lawful sole successor of the Company.

Section 15.3.     Surrender of Company Powers.

         The Company by instrument in writing executed by appropriate  authority
of its Board of Directors  and delivered to the Trustee may surrender any of the
powers  reserved to the Company,  and thereupon such power so surrendered  shall
terminate  both as to the Company,  as the case may be, and as to any  successor
corporation.

Section 15.4.     Notices.

         Except as otherwise expressly provided herein any notice or demand that
by any  provision  of this  Indenture  is required or  permitted  to be given or
served by the Trustee or by the holders of  Debentures  to or on the Company may
be  given  or  served  by being  deposited  first  class  postage  prepaid  in a
post-office  letterbox  addressed  (until another address is filed in writing by
the Company with the Trustee),  as follows:  c/o First Banks,  Inc., 11901 Olive
Blvd.,  St. Louis,  Missouri 63141,  Attention:  Allen H. Blake,  Executive Vice

<PAGE>

President.  Any  notice,  election,  request  or  demand by the  Company  or any
Debentureholder to or upon the Trustee shall be deemed to have been sufficiently
given or made,  for all  purposes,  if given or made in writing at the Corporate
Trust Office of the Trustee.

Section 15.5.     Governing Law.

         This Indenture and each Debenture shall be deemed to be a contract made
under the internal  laws of the State of Missouri and for all purposes  shall be
construed in accordance with the laws of said State.

Section 15.6.     Treatment of Debentures as Debt.

         It is intended that the Debentures shall be treated as indebtedness and
not as equity for federal income tax purposes.  The provisions of this Indenture
shall be interpreted to further this intention.

Section 15.7.     Compliance Certificates and Opinions.

         (a) Upon any  application  or demand by the  Company to the  Trustee to
take any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an  Officers'  Certificate  stating  that all  conditions
precedent  provided for in this Indenture  relating to the proposed  action have
been complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such  conditions  precedent have been complied with,  except that in
the case of any such  application  or demand as to which the  furnishing of such
documents is specifically  required by any provision of this Indenture  relating
to such particular  application or demand, no additional  certificate or opinion
need be furnished.

         (b) Each  certificate  or opinion of the Company  provided  for in this
Indenture  and  delivered  to the  Trustee  with  respect to  compliance  with a
condition or covenant in this  Indenture  shall include (1) a statement that the
Person making such  certificate  or opinion has read such covenant or condition;
(2) a  brief  statement  as to  the  nature  and  scope  of the  examination  or
investigation   upon  which  the  statements  or  opinions   contained  in  such
certificate or opinion are based;  (3) a statement  that, in the opinion of such
Person, he has made such examination or investigation as, in the opinion of such
Person,  is necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and (4) a statement as
to whether or not, in the opinion of such Person, such condition or covenant has
been complied with.

Section 15.8.     Payments on Business Days.

         In any case where the date of maturity of interest or  principal of any
Debenture or the date of  redemption  of any  Debenture  shall not be a Business
Day,  then payment of interest or principal  may be made on the next  succeeding
Business  Day with the same force and effect as if made on the  nominal  date of
maturity or  redemption,  and no interest shall accrue for the period after such
nominal date.
<PAGE>

Section 15.9.     Conflict with Trust Indenture Act.

         If and to the  extent  that any  provision  of this  Indenture  limits,
qualifies  or  conflicts  with  the  duties  imposed  by  Sections  310 to  317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.

Section 15.10.    Counterparts.

         This Indenture may be executed in any number of  counterparts,  each of
which shall be an original,  but such counterparts shall together constitute but
one and the same instrument.

Section 15.11.    Separability.

         In case any one or more of the  provisions  contained in this Indenture
or in the  Debentures  shall for any  reason be held to be  invalid,  illegal or
unenforceable in any respect,  such invalidity,  illegality or  unenforceability
shall not affect any other  provisions of this  Indenture or of the  Debentures,
but this Indenture and the  Debentures  shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.

Section 15.12.    Assignment.

         The  Company  shall  have the right at all  times to assign  any of its
respective  rights or  obligations  under this Indenture to a direct or indirect
wholly owned Subsidiary of the Company,  provided that, in the event of any such
assignment, the Company shall remain liable for all such obligations. Subject to
the  foregoing,  this Indenture is binding upon and inures to the benefit of the
parties thereto and their respective  successors and assigns. This Indenture may
not otherwise be assigned by the parties thereto.

Section 15.13.    Acknowledgment of Rights.

         The Company  acknowledges  that, with respect to any Debentures held by
the Trust or a trustee of the Trust,  if the Property  Trustee  fails to enforce
its rights  under this  Indenture  as the holder of the  Debentures  held as the
assets of the Trust,  any holder of Preferred  Securities  may  institute  legal
proceedings  directly  against the Company to enforce  such  Property  Trustee's
rights under this  Indenture  without first  instituting  any legal  proceedings
against such Property 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 Company 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),  the Company  acknowledges
that a holder of Preferred  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 Preferred  Securities of such holder on or after the  respective due date
specified in the Debentures.


                                  ARTICLE XVI.
                           SUBORDINATION OF DEBENTURES

Section 16.1.     Agreement to Subordinate.

         The Company covenants and agrees,  and each holder of Debentures issued
hereunder by such holder's  acceptance  thereof  likewise  covenants and agrees,

<PAGE>

that all  Debentures  shall be issued  subject to the provisions of this Article
XVI;  and each  holder  of a  Debenture,  whether  upon  original  issue or upon
transfer  or  assignment  thereof,  accepts  and  agrees  to be  bound  by  such
provisions.  The payment by the Company of the  principal of and interest on all
Debentures  issued hereunder shall, to the extent and in the manner  hereinafter
set forth, be  subordinated  and junior in right of payment to the prior payment
in full of all Senior Debt,  Subordinated Debt and Additional Senior Obligations
(collectively,  "Senior  Indebtedness")  to the extent provided herein,  whether
outstanding at the date of this Indenture or thereafter  incurred.  No provision
of this  Article  XVI shall  prevent the  occurrence  of any default or Event of
Default hereunder.

Section 16.2.     Default on Senior Debt, Subordinated Debt or Additional Senior
                  Obligations.

         In the event and during the  continuation of any default by the Company
in the payment of principal,  premium,  interest or any other payment due on any
Senior  Indebtedness  of the  Company,  or in the event that the maturity of any
Senior  Indebtedness of the Company has been  accelerated  because of a default,
then,  in either case,  no payment  shall be made by the Company with respect to
the principal (including  redemption payments) of or interest on the Debentures.
In the event that,  notwithstanding the foregoing, any payment shall be received
by the Trustee when such payment is prohibited by the preceding sentence of this
Section 16.2,  such payment shall be held in trust for the benefit of, and shall
be paid over or  delivered  to,  the  holders  of Senior  Indebtedness  or their
respective  representatives,  or to the trustee or trustees  under any indenture
pursuant to which any of such Senior Indebtedness may have been issued, as their
respective  interests may appear, but only to the extent that the holders of the
Senior  Indebtedness (or their  representative or  representatives or a trustee)
notify the Trustee in writing within 90 days of such payment of the amounts then
due and owing on the Senior  Indebtedness and only the amounts specified in such
notice to the Trustee shall be paid to the holders of Senior Indebtedness.

Section 16.3.     Liquidation; Dissolution; Bankruptcy.

         (a) Upon any  payment by the Company or  distribution  of assets of the
Company of any kind or character,  whether in cash,  property or securities,  to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company,  whether  voluntary or involuntary  or in  bankruptcy,  insolvency,
receivership or other proceedings,  all amounts due upon all Senior Indebtedness
of the Company shall first be paid in full, or payment  thereof  provided for in
money in accordance with its terms, before any payment is made by the Company on
account  of the  principal  or  interest  on the  Debentures;  and upon any such
dissolution or winding-up or liquidation or  reorganization,  any payment by the
Company,  or  distribution  of assets of the  Company of any kind or  character,
whether in cash, property or securities,  to which the holders of the Debentures
or the Trustee  would be entitled to receive  from the  Company,  except for the
provisions of this Article XVI, shall be paid by the Company or by any receiver,
trustee in bankruptcy,  liquidating  trustee,  agent or other Person making such
payment or  distribution,  or by the holders of the Debentures or by the Trustee
under this  Indenture  if  received  by them or it,  directly  to the holders of
Senior Indebtedness of the Company (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders, as calculated by
the Company) or their  representative or  representatives,  or to the trustee or
trustees under any indenture  pursuant to which any instruments  evidencing such

<PAGE>

Senior  Indebtedness  may have been issued,  as their  respective  interests may
appear,  to the extent  necessary to pay such Senior  Indebtedness  in full,  in
money or  money's  worth,  after  giving  effect to any  concurrent  payment  or
distribution  to or for the  holders  of such  Senior  Indebtedness,  before any
payment or distribution is made to the holders of Debentures or to the Trustee.

         (b) In the event that,  notwithstanding  the foregoing,  any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities,  prohibited by the  foregoing,  shall be received by the
Trustee  before  all Senior  Indebtedness  of the  Company  is paid in full,  or
provision is made for such payment in money in accordance  with its terms,  such
payment or  distribution  shall be held in trust for the benefit of and shall be
paid over or  delivered  to the  holders of such  Senior  Indebtedness  or their
representative  or  representatives,  or to the  trustee or  trustees  under any
indenture pursuant to which any instruments  evidencing such Senior Indebtedness
may have been issued,  and their respective  interests may appear, as calculated
by the Company, for application to the payment of all Senior Indebtedness of the
Company,  as the case may be,  remaining  unpaid to the extent  necessary to pay
such Senior  Indebtedness in full in money in accordance  with its terms,  after
giving effect to any concurrent payment or distribution to or for the benefit of
the holders of such Senior Indebtedness.

         (c) For purposes of this  Article  XVI,  the words  "cash,  property or
securities"  shall not be deemed to  include  shares of stock of the  Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization  or readjustment,  the payment of which
is subordinated at least to the extent provided in this Article XVI with respect
to the Debentures to the payment of all Senior  Indebtedness of the Company,  as
the case may be,  that may at the time be  outstanding,  provided  that (i) such
Senior  Indebtedness is assumed by the new corporation,  if any,  resulting from
any such  reorganization or readjustment;  and (ii) the rights of the holders of
such Senior  Indebtedness are not, without the consent of such holders,  altered
by such  reorganization or readjustment.  The consolidation of the Company with,
or the merger of the Company into,  another  corporation  or the  liquidation or
dissolution of the Company  following the conveyance or transfer of its property
as an entirety, or substantially as an entirety, to another corporation upon the
terms  and  conditions  provided  for in  Article  XII  shall  not be  deemed  a
dissolution,  winding-up, liquidation or reorganization for the purposes of this
Section 16.3 if such other corporation  shall, as a part of such  consolidation,
merger,  conveyance or transfer,  comply with the  conditions  stated in Article
XII.  Nothing in Section  16.2 or in this Section 16.3 shall apply to claims of,
or payments to, the Trustee under or pursuant to Section 9.7.

Section 16.4.     Subrogation.

         (a)  Subject to the payment in full of all Senior  Indebtedness  of the
Company,  the rights of the holders of the Debentures shall be subrogated to the
rights of the  holders  of such  Senior  Indebtedness  to  receive  payments  or
distributions  of cash,  property or securities of the Company,  as the case may
be, applicable to such Senior  Indebtedness  until the principal of and interest
on the  Debentures  shall  be paid  in  full;  and,  for  the  purposes  of such
subrogation,  no  payments  or  distributions  to the  holders  of  such  Senior
Indebtedness  of any cash,  property or  securities  to which the holders of the
Debentures  or the Trustee would be entitled  except for the  provisions of this

<PAGE>

Article XVI, and no payment over pursuant to the  provisions of this Article XVI
to or for the benefit of the holders of such Senior  Indebtedness  by holders of
the  Debentures  or the Trustee,  shall,  as between the Company,  its creditors
other than holders of Senior Indebtedness of the Company, and the holders of the
Debentures,  be deemed to be a payment  by the  Company to or on account of such
Senior  Indebtedness.  It is understood  that the provisions of this Article XVI
are and are intended  solely for the purposes of defining the relative rights of
the holders of the  Debentures,  on the one hand, and the holders of such Senior
Indebtedness on the other hand.

         (b)  Nothing  contained  in  this  Article  XVI or  elsewhere  in  this
Indenture or in the  Debentures is intended to or shall  impair,  as between the
Company,  its creditors  (other than the holders of Senior  Indebtedness  of the
Company),  and the holders of the  Debentures,  the  obligation  of the Company,
which is absolute and unconditional, to pay to the holders of the Debentures the
principal  of and interest on the  Debentures  as and when the same shall become
due and  payable in  accordance  with their  terms,  or is  intended to or shall
affect the relative rights of the holders of the Debentures and creditors of the
Company,  as the case may be, other than the holders of Senior  Indebtedness  of
the Company,  as the case may be, nor shall anything  herein or therein  prevent
the  Trustee  or the  holder  of any  Debenture  from  exercising  all  remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the  rights,  if any,  under this  Article  XVI of the holders of such Senior
Indebtedness in respect of cash,  property or securities of the Company,  as the
case may be, received upon the exercise of any such remedy.

         (c) Upon any payment or distribution of assets of the Company  referred
to in this Article XVI, the Trustee,  subject to the  provisions  of Article IX,
and the holders of the Debentures  shall be entitled to  conclusively  rely upon
any order or decree made by any court of  competent  jurisdiction  in which such
dissolution,  winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver,  trustee in bankruptcy,  liquidation  trustee,
agent or other  Person  making such  payment or  distribution,  delivered to the
Trustee or to the holders of the  Debentures,  for the purposes of  ascertaining
the Persons entitled to participate in such distribution,  the holders of Senior
Indebtedness  and other  indebtedness  of the  Company,  as the case may be, the
amount  thereof or payable  thereon,  the amount or amounts paid or  distributed
thereon and all other facts pertinent thereto or to this Article XVI.

Section 16.5.     Trustee to Effectuate Subordination.

         Each  holder  of  Debentures  by  such  holder's   acceptance   thereof
authorizes  and directs the Trustee on such holder's  behalf to take such action
as may be necessary or appropriate to effectuate the  subordination  provided in
this Article XVI and appoints the Trustee such holder's attorney-in-fact for any
and all such purposes.

Section 16.6.     Notice by the.

         (a) The  Company  shall give  prompt  written  notice to a  Responsible
Officer of the Trustee of any fact known to the Company that would  prohibit the
making  of  any  payment  of  monies  to or by the  Trustee  in  respect  of the
Debentures  pursuant to the provisions of this Article XVI.  Notwithstanding the
provisions  of this Article XVI or any other  provision of this  Indenture,  the

<PAGE>

Trustee  shall not be charged with  knowledge of the existence of any facts that
would  prohibit  the  making of any  payment  of monies to or by the  Trustee in
respect of the Debentures pursuant to the provisions of this Article XVI, unless
and until a  Responsible  Officer of the  Trustee  shall have  received  written
notice thereof from the Company or a holder or holders of Senior Indebtedness or
from any trustee  therefor;  and before the receipt of any such written  notice,
the Trustee,  subject to the provisions of Section 9.1, shall be entitled in all
respects  to assume that no such facts  exist;  provided,  however,  that if the
Trustee shall not have received the notice  provided for in this Section 16.6 at
least two  Business  Days prior to the date upon  which by the terms  hereof any
money may become payable for any purpose  (including,  without  limitation,  the
payment of the principal of or interest on any Debenture), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power and
authority  to receive such money and to apply the same to the purposes for which
they were received, and shall not be affected by any notice to the contrary that
may be received by it within two Business Days prior to such date.

         (b) The Trustee,  subject to the  provisions  of Section 9.1,  shall be
entitled to  conclusively  rely on the  delivery to it of a written  notice by a
Person representing himself to be a holder of Senior Indebtedness of the Company
(or a trustee on behalf of such holder) to  establish  that such notice has been
given by a holder of such Senior Indebtedness or a trustee on behalf of any such
holder or holders.  In the event that the Trustee  determines in good faith that
further evidence is required with respect to the right of any Person as a holder
of such  Senior  Indebtedness  to  participate  in any  payment or  distribution
pursuant to this  Article  XVI,  the Trustee may request  such Person to furnish
evidence to the reasonable  satisfaction of the Trustee as to the amount of such
Senior  Indebtedness  held by such  Person,  the extent to which such  Person is
entitled to  participate  in such  payment or  distribution  and any other facts
pertinent  to the rights of such Person  under this  Article  XVI,  and, if such
evidence  is not  furnished,  the  Trustee  may defer any payment to such Person
pending  judicial  determination  as to the right of such Person to receive such
payment.

Section 16.7.     Rights of the Trustee; Holders of Senior Indebtedness.

         (a) The Trustee in its individual capacity shall be entitled to all the
rights set forth in this  Article XVI in respect of any Senior  Indebtedness  at
any  time  held  by it,  to the  same  extent  as any  other  holder  of  Senior
Indebtedness,  and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder. The Trustee's right to compensation and reimbursement
of  expenses  as  set  forth  in  Section  9.7  shall  not  be  subject  to  the
subordination provisions of the Article XVI.

         (b) With respect to the holders of Senior  Indebtedness of the Company,
the Trustee  undertakes  to perform or to observe only such of its covenants and
obligations  as are  specifically  set forth in this Article XVI, and no implied
covenants or obligations with respect to the holders of such Senior Indebtedness
shall be read into this Indenture against the Trustee.  The Trustee shall not be
deemed to owe any fiduciary duty to the holders of such Senior Indebtedness and,
subject to the provisions of Section 9.1, the Trustee shall not be liable to any
holder of such Senior Indebtedness if it shall pay over or deliver to holders of
Debentures,  the Company or any other Person money or assets to which any holder
of such Senior  Indebtedness  shall be entitled by virtue of this Article XVI or
otherwise.
<PAGE>

Section 16.8.     Subordination may not be Impaired.

         (a) No right of any present or future holder of any Senior Indebtedness
of the Company to enforce  subordination as herein provided shall at any time in
any way be  prejudiced  or  impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith,  by any such holder,
or by any noncompliance by the Company with the terms,  provisions and covenants
of this Indenture,  regardless of any knowledge thereof that any such holder may
have or otherwise be charged with.

         (b)  Without  in any  way  limiting  the  generality  of the  foregoing
paragraph,  the holders of Senior  Indebtedness  of the Company may, at any time
and from time to time,  without  the  consent of or notice to the Trustee or the
holders of the Debentures,  without  incurring  responsibility to the holders of
the Debentures and without impairing or releasing the subordination  provided in
this Article XVI or the  obligations  hereunder of the holders of the Debentures
to the holders of such Senior Indebtedness, do any one or more of the following:
(i) change the  manner,  place or terms of payment or extend the time of payment
of,  or  renew  or  alter,  such  Senior  Indebtedness,  or  otherwise  amend or
supplement in any manner such Senior  Indebtedness or any instrument  evidencing
the same or any agreement  under which such Senior  Indebtedness is outstanding;
(ii)  sell,  exchange,  release or  otherwise  deal with any  property  pledged,
mortgaged or otherwise  securing  such Senior  Indebtedness;  (iii)  release any
Person liable in any manner for the collection of such Senior Indebtedness;  and
(iv) exercise or refrain from  exercising any rights against the Company and any
other Person.

         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed,  and their respective  corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.

                                FIRST BANKS, INC.


                                          By:  /s/ Allen H. Blake
                                          Name: Allen H. Blake
                                          Title: Executive Vice President,
                                                 Chief Financial Officer and
  Secretary

Attest:

 /s/ Laurence J. Brost

                                          STATE STREET BANK AND TRUST COMPANY, 
                                           as trustee

                                          By: /s/ Paul D. Allen
                                          Name:  Paul D. Allen
                                          Title: Vice President

Attest:

 /s/


<PAGE>


STATE OF MISSOURI )
                                    ) ss:
COUNTY OF ST. LOUIS        )


         On this 4th day of February,  1997,  before me appeared Allen H. Blake,
to me  personally  known,  who,  being by me duly sworn,  did say that he is the
Executive Vice President,  CFO and Secretary of FIRST BANKS,  INC., and that the
seal affixed to said instrument is the corporate seal of said  corporation,  and
that said  instrument  was signed and  sealed in behalf of said  corporation  by
authority of its board of directors and said Allen H. Blake,  acknowledged  said
instrument to be the free act and deed of said corporation.

         In  testimony  whereof  I have  hereunto  set my hand  and  affixed  my
official  seal at my office in said county and state the day and year last above
written.


                                                  /s/ J. Stephens
                                                 Notary Public

[seal]                                           My term expires: June 27, 1997




COMMONWEALTH OF MASSACHUSETTS       )
                                                              ) ss:
COUNTY OF SUFFOLK                           )


         On this 24th day of January, 1997, before me appeared Paul D. Allen, to
me personally  known,  who, being by me duly sworn,  did say that he is the Vice
President of STATE STREET BANK AND TRUST  COMPANY,  and that the seal affixed to
said  instrument  is the  corporate  seal of said  corporation,  and  that  said
instrument  was signed and sealed in behalf of said  corporation by authority of
its board of directors and said Paul D. Allen,  acknowledged  said instrument to
be the free act and deed of said corporation.

         In  testimony  whereof  I have  hereunto  set my hand  and  affixed  my
official  seal at my office in said county and state the day and year last above
written.


                                                 /s/ Scott Knox
                                                 Notary Public


[seal]                                           My term expires: July 12, 2002





<PAGE>






                                    EXHIBIT A

                           (FORM OF FACE OF DEBENTURE)


No.                                                        $ 88,917,550
    -----------------------------                      
CUSIP No. 319287 AA 6


                                FIRST BANKS, INC.

                          9.25% SUBORDINATED DEBENTURE

                               DUE MARCH 31, 2027


         First Banks,  Inc., a Missouri  corporation  (the "Company," which term
includes any successor corporation under the Indenture hereinafter referred to),
for value  received,  hereby  promises  to pay to,  State  Street Bank and Trust
Company,  as Property  Trustee,  or  registered  assigns,  the  principal sum of
Eighty-Eight  Million,  Nine Hundred  Seventeen  Thousand,  Five  Hundred  Fifty
Dollars  ($88,917,550)  on March 31, 2027 (the  "Stated  Maturity"),  and to pay
interest on said  principal  sum from  February 4, 1997, or from the most recent
interest  payment  date (each such date,  an "Interest  Payment  Date") to which
interest has been paid or duly provided for,  quarterly  (subject to deferral as
set forth herein) in arrears on March 31, June 30,  September 30 and December 31
of each year commencing March 31, 1997, at the rate of 9.25% per annum until the
principal hereof shall have become due and payable, and on any overdue principal
and (without  duplication)  on any overdue  installment  of interest at the same
rate per annum  compounded  quarterly.  The  amount of  interest  payable on any
Interest Payment Date shall be computed on the basis of a 360-day year of twelve
30-day  months.  The amount of interest for any partial period shall be computed
on the basis of the number of days  elapsed in a 360-day  year of twelve  30-day
months.  In the  event  that any  date on  which  interest  is  payable  on this
Debenture is not a business day,  then payment of interest  payable on such date
shall be made on the next succeeding day that is a business day (and without any
interest or other  payment in respect of any such delay) with the same force and
effect  as if made on such  date.  The  interest  installment  so  payable,  and
punctually  paid or duly  provided for, on any Interest  Payment Date shall,  as
provided in the  Indenture,  be paid to the person in whose name this  Debenture
(or one or more  Predecessor  Debentures,  as  defined  in  said  Indenture)  is
registered at the close of business on the regular record date for such interest
installment,  which shall be the fifteenth day of the last month of the calendar
quarter in which such Interest Payment Date occurs unless otherwise  provided in
the  Indenture.  Any  such  interest  installment  not  punctually  paid or duly
provided for shall  forthwith  cease to be payable to the registered  holders on
such  regular  record  date and may be paid to the  Person  in whose  name  this
Debenture (or one or more Predecessor  Debentures) is registered at the close of
business on a special  record date to be fixed by the Trustee for the payment of
such defaulted interest, notice whereof shall be given to the registered holders
of the  Debentures  not less than 10 days prior to such special  record date, or
may be paid at any time in any other  lawful  manner not  inconsistent  with the

<PAGE>

requirements  of any securities  exchange on which the Debentures may be listed,
and upon such  notice as may be  required  by such  exchange,  all as more fully
provided in the  Indenture.  The principal of and the interest on this Debenture
shall be  payable  at the office or agency of the  Trustee  maintained  for that
purpose in any coin or currency of the United States of America that at the time
of payment is legal  tender for payment of public and private  debts;  provided,
however,  that  payment of interest  may be made at the option of the Company by
check  mailed to the  registered  holder at such  address as shall appear in the
Debenture Register. Notwithstanding the foregoing, so long as the holder of this
Debenture is the Property Trustee,  the payment of the principal of and interest
on this  Debenture  shall be made at such  place and to such  account  as may be
designated by the Trustee.

         The Stated  Maturity may be shortened at any time by the Company to any
date not earlier than March 31,  2002,  subject to the Company  having  received
prior approval of the Federal Reserve if then required under applicable  capital
guidelines or policies of the Federal Reserve. Such date may also be extended at
any time at the election of the Company for one or more periods, but in no event
to a date later than March 31, 2046, subject to certain limitations described in
the Indenture.

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

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

         The  provisions  of this  Debenture  are  continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.


<PAGE>



         IN WITNESS  WHEREOF,  the  Company  has caused  this  instrument  to be
executed.

Dated February 4, 1997
                                   FIRST BANKS, INC.


                                   By:   ______________________
                                   Name: ______________________
                                   Title:______________________
Attest:

By:     ______________________
Name:   ______________________
Title:  ______________________


<PAGE>


                     [FORM OF CERTIFICATE OF AUTHENTICATION]

                          CERTIFICATE OF AUTHENTICATION

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

Dated:

STATE STREET BANK AND TRUST COMPANY,                  ________________________
as Trustee                                        or  Authentication Agent

                                                  By  ________________________
By  ____________________                                                  
    Authorized Signatory


<PAGE>


                         [FORM OF REVERSE OF DEBENTURE]

                          9.25% SUBORDINATED DEBENTURE
                                   (CONTINUED)

         This  Debenture is one of the  subordinated  debentures  of the Company
(herein sometimes referred to as the "Debentures"),  specified in the Indenture,
all  issued  or to be issued  under and  pursuant  to an  Indenture  dated as of
February 4, 1997 (the  "Indenture")  duly  executed  and  delivered  between the
Company and State Street Bank and Trust Company, as Trustee (the "Trustee"),  to
which  Indenture  reference  is hereby  made for a  description  of the  rights,
limitations  of rights,  obligations,  duties and  immunities  thereunder of the
Trustee,  the Company  and the holders of the  Debentures.  The  Debentures  are
limited in aggregate principal amount as specified in the Indenture.

         Because of the  occurrence  and  continuation  of a Special  Event,  in
certain  circumstances,  this  Debenture  may  become  due  and  payable  at the
principal  amount together with any interest  accrued  thereon (the  "Redemption
Price").  The  Redemption  Price  shall be paid  prior to  12:00  noon,  Eastern
Standard Time,  time, on the date of such  redemption or at such earlier time as
the  Company  determines.  The  Company  shall  have the  right to  redeem  this
Debenture at the option of the Company,  without premium or penalty, in whole or
in part at any time on or after March 31, 2002 (an "Optional Redemption"), or at
any time in certain  circumstances  upon the occurrence of a Special Event, at a
Redemption  Price  equal to 100% of the  principal  amount  plus any accrued but
unpaid interest, to the date of such redemption. Any redemption pursuant to this
paragraph shall be made upon not less than 30 days nor more than 60 days notice,
at the Redemption  Price.  If the Debentures are only partially  redeemed by the
Company pursuant to an Optional Redemption, the Debentures shall be redeemed pro
rata or by lot or by any other method utilized by the Trustee.

         In the  event of  redemption  of this  Debenture  in part  only,  a new
Debenture or Debentures for the unredeemed portion hereof shall be issued in the
name of the holder hereof upon the cancellation hereof.

         In case an Event of Default,  as defined in the  Indenture,  shall have
occurred  and be  continuing,  the  principal  of all of the  Debentures  may be
declared,  and upon such  declaration  shall  become,  due and  payable,  in the
manner, with the effect and subject to the conditions provided in the Indenture.

         The  Indenture  contains  provisions  permitting  the  Company  and the
Trustee,  with the  consent  of the  holders  of not  less  than a  majority  in
aggregate principal amount of the Debentures at the time outstanding, as defined
in the Indenture,  to execute supplemental  indentures for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions
of the Indenture or of any supplemental  indenture or of modifying in any manner
the rights of the holders of the  Debentures;  provided,  however,  that no such
supplemental  indenture  shall (i) extend the fixed  maturity of the  Debentures
except as provided in the Indenture,  or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest  thereon,  without the
consent  of the  holder  of each  Debenture  so  affected;  or (ii)  reduce  the
aforesaid percentage of Debentures, the holders of which are required to consent

<PAGE>

to any such supplemental  indenture,  without the consent of the holders of each
Debenture then  outstanding  and affected  thereby.  The Indenture also contains
provisions permitting the holders of a majority in aggregate principal amount of
the Debentures at the time  outstanding,  on behalf of all of the holders of the
Debentures, to waive any past default in the performance of any of the covenants
contained in the Indenture,  or established  pursuant to the Indenture,  and its
consequences, except a default in the payment of the principal of or interest on
any of the  Debentures.  Any such consent or waiver by the registered  holder of
this Debenture (unless revoked as provided in the Indenture) shall be conclusive
and  binding  upon such  holder and upon all future  holders  and owners of this
Debenture  and of any  Debenture  issued in exchange  herefor or in place hereof
(whether by registration  of transfer or otherwise),  irrespective of whether or
not any notation of such consent or waiver is made upon this Debenture.

         No reference herein to the Indenture and no provision of this Debenture
or of the Indenture  shall alter or impair the obligation of the Company,  which
is  absolute  and  unconditional,  to pay the  principal  and  interest  on this
Debenture  at the  time  and  place  and at the  rate  and in the  money  herein
prescribed.

         The  Company  shall  have the right at any time  during the term of the
Debentures  and from time to time to extend the interest  payment period of such
Debentures  for up to 20  consecutive  quarters  (each,  an  "Extended  Interest
Payment Period"),  at the end of which period the Company shall pay all interest
then accrued and unpaid  (together  with interest  thereon at the rate specified
for the  Debentures to the extent that payment of such  interest is  enforceable
under  applicable  law).  Before the  termination of any such Extended  Interest
Payment Period,  the Company may further extend such Extended  Interest  Payment
Period,  provided that such Extended  Interest  Payment Period together with all
such further extensions thereof shall not exceed 20 consecutive quarters. At the
termination of any such Extended Interest Payment Period and upon the payment of
all accrued and unpaid interest and any additional amounts then due, the Company
may commence a new Extended Interest Payment Period.

         As provided in the Indenture and subject to certain limitations therein
set forth, this Debenture is transferable by the registered holder hereof on the
Debenture  Register  of the  Company,  upon  surrender  of  this  Debenture  for
registration of transfer at the office or agency of the Trustee accompanied by a
written  instrument  or  instruments  of  transfer in form  satisfactory  to the
Company or the Trustee  duly  executed by the  registered  holder  hereof or his
attorney duly authorized in writing, and thereupon one or more new Debentures of
authorized  denominations  and for the same aggregate  principal amount shall be
issued to the designated  transferee or transferees.  No service charge shall be
made for any  such  transfer,  but the  Company  may  require  payment  of a sum
sufficient  to cover any tax or other  governmental  charge  payable in relation
thereto.

         Prior  to  due  presentment  for   registration  of  transfer  of  this
Debenture,  the  Company,  the  Trustee,  any  paying  agent  and the  Debenture
Registrar may deem and treat the registered  holder hereof as the absolute owner
hereof (whether or not this Debenture shall be overdue and  notwithstanding  any
notice of  ownership or writing  hereon made by anyone other than the  Debenture
Registrar)  for  the  purpose  of  receiving  payment  of or on  account  of the
principal hereof and interest due hereon and for all other purposes, and neither

<PAGE>

the Company nor the Trustee nor any paying  agent nor any  Debentures  Registrar
shall be affected by any notice to the contrary.

         No  recourse  shall be had for the payment of the  principal  of or the
interest on this  Debenture,  or for any claim based  hereon,  or  otherwise  in
respect  hereof,  or  based  on or in  respect  of the  Indenture,  against  any
incorporator,  stockholder,  officer or director,  past,  present or future,  as
such, of the Company or of any predecessor or successor corporation,  whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise,  all such liability being, by the acceptance
hereof  and as part of the  consideration  for the  issuance  hereof,  expressly
waived and released.

         The Debentures are issuable only in registered  form without coupons in
denominations of $25 and any integral multiple thereof.

         All terms used in this  Debenture  that are  defined  in the  Indenture
shall have the meanings assigned to them in the Indenture.


<PAGE>



                                  EXHIBIT 4(d)






                          FIRST PREFERRED CAPITAL TRUST


                              AMENDED AND RESTATED


                                 TRUST AGREEMENT


                                      among


                         FIRST BANKS, INC., as Depositor


            STATE STREET BANK AND TRUST COMPANY, as Property Trustee


                 WILMINGTON TRUST COMPANY, as Delaware Trustee,


                                       and


                    THE ADMINISTRATIVE TRUSTEES NAMED HEREIN

                          Dated as of February 4, 1997







<PAGE>
<TABLE>
<CAPTION>


                                                  TABLE OF CONTENTS

                                                                                                               PAGE

<S>                                                                                                              <C>
ARTICLE I  -  DEFINED TERMS.....................................................................................  1
         Section 101.  Definitions..............................................................................  1

ARTICLE II  -  ESTABLISHMENT OF THE TRUST.......................................................................  9
         Section 201.  Name.....................................................................................  9
         Section 202.  Office of the Delaware Trustee; Principal Place of Business..............................  9
         Section 203.  Initial Contribution of Trust Property; Organizational Expenses..........................  9
         Section 204.  Issuance of the Preferred Securities.....................................................  9
         Section 205.  Issuance of the Common Securities; Subscription and Purchase of Debentures...............  9
         Section 206.  Declaration of Trust..................................................................... 10
         Section 207.  Authorization to Enter into Certain Transactions......................................... 10
         Section 208.  Assets of Trust.......................................................................... 13
         Section 209.  Title to Trust Property.................................................................. 13

ARTICLE III  -  PAYMENT ACCOUNT................................................................................. 13
         Section 301.  Payment Account.......................................................................... 13

ARTICLE IV  -  DISTRIBUTIONS; REDEMPTION........................................................................ 14
         Section 401.  Distributions............................................................................ 14
         Section 402.  Redemption............................................................................... 14
         Section 403.  Subordination of Common Securities....................................................... 16
         Section 404.  Payment Procedures....................................................................... 16
         Section 405.  Tax Returns and Reports.................................................................. 17
         Section 406.  Payment of Taxes, Duties, etc. of the Trust.............................................. 17
         Section 407.  Payments Under Indenture................................................................. 17

ARTICLE V  -  TRUST SECURITIES CERTIFICATES..................................................................... 17
         Section 501.  Initial Ownership........................................................................ 17
         Section 502.  The Trust Securities Certificates........................................................ 17
         Section 503.  Execution, Authentication and Delivery of Trust Securities Certificates.................. 18
         Section 504.  Registration of Transfer and Exchange of Preferred Securities Certificates............... 18
         Section 505.  Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates....................... 19
         Section 506.  Persons Deemed Securityholders........................................................... 19
         Section 507.  Access to List of Securityholders' Names and Addresses................................... 19
         Section 508.  Maintenance of Office or Agency.......................................................... 20
         Section 509.  Appointment of Paying Agent.............................................................. 20
         Section 510.  Ownership of Common Securities by Depositor.............................................. 21
         Section 511.  Preferred Securities Certificates........................................................ 21
         Section 512.  [Intentionally Omitted].................................................................. 21
         Section 513.  [Intentionally Omitted].................................................................. 21
         Section 514.  Rights of Securityholders................................................................ 21
<PAGE>

ARTICLE VI  -  ACTS OF SECURITYHOLDERS; MEETINGS; VOTING........................................................ 22
         Section 601.  Limitations on Voting Rights............................................................. 22
         Section 602.  Notice of Meetings....................................................................... 23
         Section 603.  Meetings of Preferred Securityholders.................................................... 23
         Section 604.  Voting Rights............................................................................ 23
         Section 605.  Proxies, etc............................................................................. 23
         Section 606.  Securityholder Action by Written Consent................................................. 24
         Section 607.  Record Date for Voting and Other Purposes................................................ 24
         Section 608.  Acts of Securityholders.................................................................. 24
         Section 609.  Inspection of Records.................................................................... 25

ARTICLE VII  -  REPRESENTATIONS AND WARRANTIES.................................................................. 25
         Section 701.  Representations and Warranties of the Bank and the Property Trustee...................... 25
         Section 702.  Representations and Warranties of the Delaware Bank and the Delaware Trustee............. 26
         Section 703.  Representations and Warranties of Depositor.............................................. 27

ARTICLE VIII  -  TRUSTEES....................................................................................... 28
         Section 801.  Certain Duties and Responsibilities...................................................... 28
         Section 802.  Certain Notices.......................................................................... 29
         Section 803.  Certain Rights of Property Trustee....................................................... 29
         Section 804.  Not Responsible for Recitals or Issuance of Securities................................... 31
         Section 805.  May Hold Securities...................................................................... 31
         Section 806.  Compensation; Indemnity; Fees............................................................ 31
         Section 807.  Corporate Property Trustee Required; Eligibility of Trustees............................. 32
         Section 808.  Conflicting Interests.................................................................... 32
         Section 809.  Co-Trustees and Separate Trustee......................................................... 32
         Section 810.  Resignation and Removal; Appointment of Successor........................................ 34
         Section 811.  Acceptance of Appointment by Successor................................................... 35
         Section 812.  Merger, Conversion, Consolidation or Succession to Business.............................. 35
         Section 813.  Preferential Collection of Claims Against Depositor or Trust............................. 36
         Section 814.  Reports by Property Trustee.............................................................. 36
         Section 815.  Reports to the Property Trustee.......................................................... 36
         Section 816.  Evidence of Compliance with Conditions Precedent......................................... 36
         Section 817.  Number of Trustees....................................................................... 37
         Section 818.  Delegation of Power...................................................................... 37
         Section 819.  Voting................................................................................... 37

ARTICLE IX  -  TERMINATION, LIQUIDATION AND MERGER.............................................................. 37
         Section 901.  Termination Upon Expiration Date......................................................... 37
         Section 902.  Early Termination........................................................................ 38
         Section 903.  Termination.............................................................................. 38
         Section 904.  Liquidation.............................................................................. 38
         Section 905.  Mergers, Consolidations, Amalgamations or Replacements of the Trust...................... 39

ARTICLE X  -  MISCELLANEOUS PROVISIONS.......................................................................... 40
         Section 1001.  Limitation of Rights of Securityholders................................................. 40
         Section 1002.  Amendment............................................................................... 40
         Section 1003.  Separability............................................................................ 42
         Section 1004.  Governing law........................................................................... 42
         Section 1005.  Payments Due on Non-Business Day........................................................ 42
         Section 1006.  Successors.............................................................................. 42
         Section 1007.  Headings................................................................................ 42
         Section 1008.  Reports, Notices and Demands............................................................ 42
         Section 1009.  Agreement Not to Petition............................................................... 43
         Section 1010.  Trust Indenture Act; Conflict with Trust Indenture Act.................................. 44
         Section 1011.  Acceptance of Terms of Trust Agreement, Guarantee and Indenture......................... 44


         Exhibit A.........Certificate of Trust
         Exhibit B.........[Intentionally Omitted]
         Exhibit C.........Form of Common Securities Certificate
         Exhibit D.........Form of Expense Agreement
         Exhibit E.........Form of Preferred Securities Certificate
</TABLE>

<PAGE>





                      AMENDED AND RESTATED TRUST AGREEMENT

         AMENDED AND  RESTATED  TRUST  AGREEMENT,  dated as of February 4, 1997,
among (i) FIRST BANKS, INC., a Missouri corporation (including any successors or
assigns,  the  "Depositor"),  (ii) STATE STREET BANK AND TRUST COMPANY,  a trust
company  duly  organized  and  existing  under the laws of the  Commonwealth  of
Massachusetts,  as property trustee (the "Property Trustee" and, in its separate
corporate  capacity  and not in its capacity as Property  Trustee,  the "Bank"),
(iii)  WILMINGTON TRUST COMPANY,  a Delaware banking  corporation duly organized
and existing under the laws of the State of Delaware,  as Delaware  trustee (the
"Delaware  Trustee,"  and, in its  separate  corporate  capacity  and not in its
capacity as Delaware  Trustee,  the "Delaware Bank") (iv) JAMES F. DIERBERG,  an
individual, ALLEN H. BLAKE, an individual, and LAURENCE J. BROST, an individual,
each of whose  address is c/o First  Banks,  Inc.,  11901 Olive  Boulevard,  St.
Louis,  Missouri 63141 (each an  "Administrative  Trustee" and  collectively the
"Administrative  Trustees") (the Property Trustee,  the Delaware Trustee and the
Administrative Trustees referred to collectively as the "Trustees"), and (v) the
several Holders (as hereinafter defined).

                                    RECITALS

         WHEREAS,  the Depositor,  the Delaware Trustee,  and James F. Dierberg,
Allen H. Blake and Laurence J. Brost,  each as an Administrative  Trustee,  have
heretofore  duly  declared  and  established  a business  trust  pursuant to the
Delaware  Business  Trust  Act  by the  entering  into  of  that  certain  Trust
Agreement,  dated as of December 12, 1996 (the "Original Trust Agreement"),  and
by the  execution  and filing by the Delaware  Trustee,  the  Depositor  and the
Administrative  Trustees with the Secretary of State of the State of Delaware of
the  Certificate  of Trust,  filed on December  13,  1996,  the form of which is
attached as Exhibit A; and

         WHEREAS, the Depositor,  the Delaware Trustee, the Property Trustee and
the  Administrative  Trustees  desire to amend and  restate the  Original  Trust
Agreement  in its  entirety  as set forth  herein to provide  for,  among  other
things,  (i) the issuance of the Common  Securities  (as defined  herein) by the
Trust (as defined  herein) to the  Depositor;  (ii) the issuance and sale of the
Preferred   Securities  (as  defined  herein)  by  the  Trust  pursuant  to  the
Underwriting  Agreement (as defined herein);  (iii) the acquisition by the Trust
from the Depositor of all of the right, title and interest in the Debentures (as
defined herein); and (iv) the appointment of the Trustees;

         NOW THEREFORE,  in  consideration of the agreements and obligations set
forth  herein and for other good and  valuable  consideration,  the  receipt and
sufficiency of which are hereby acknowledged, each party, for the benefit of the
other parties and for the benefit of the  Securityholders  (as defined  herein),
hereby  amends and  restates the  Original  Trust  Agreement in its entirety and
agrees as follows:

<PAGE>

                                    ARTICLE I
                                  DEFINED TERMS

         Section 101.  Definitions.

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

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

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

         (c) unless  the  context  otherwise  requires,  any  reference  to   an
"Article" or a "Section"  refers to an Article or a Section, as the case may be,
of this Trust Agreement; and

         (d) the words  "herein",  "hereof" and  "hereunder"  and other words of
similar  import  refer  to  this  Trust  Agreement  as a  whole  and  not to any
particular Article, Section or other subdivision.

         "Act" has the meaning specified in Section 608.

         "Additional  Amount" means, with respect to Trust Securities of a given
Liquidation  Amount  and/or a given period,  the amount of  additional  interest
accrued on  interest in arrears  and paid by the  Depositor  on a Like Amount of
Debentures for such period.

          "Additional  Interest" has the meaning specified in Section 1.1 of the
Indenture.

         "Administrative  Trustee"  means  each of James F.  Dierberg,  Allen H.
Blake and Laurence J. Brost, solely in his capacity as Administrative Trustee of
the Trust formed and continued hereunder and not in his individual capacity,  or
such  Administrative  Trustee's  successor in interest in such capacity,  or any
successor trustee appointed as herein provided.

         "Affiliate"  means, with respect to a specified Person,  (a) any Person
directly or indirectly owning,  controlling or holding with power to vote 10% or
more of the outstanding  voting  securities or other ownership  interests of the
specified Person,  any Person 10% or more of whose outstanding voting securities
or other  ownership  interests are directly or indirectly  owned,  controlled or
held with power to vote by the  specified  Person;  (c) any Person  directly  or
indirectly  controlling,  controlled  by,  or  under  common  control  with  the
specified  Person;  (d) a partnership in which the specified Person is a general
partner;  (e) any officer or director of the  specified  Person;  and (f) if the
specified  Person is an individual,  any entity of which the specified Person is
an officer, director or general partner.

         "Authenticating  Agent" means an  authenticating  agent with respect to
the Preferred  Securities  appointed by the Property Trustee pursuant to Section
503.

          "Bank"  has the  meaning  specified  in the  Preamble  to  this  Trust
Agreement.
<PAGE>

         "Bankruptcy Event" means, with respect to any Person:

         (a) the entry of a decree or order by a court  having  jurisdiction  in
the  premises  adjudging  such Person a bankrupt or  insolvent,  or approving as
properly filed a petition seeking liquidation or reorganization of or in respect
of such Person under the United States  Bankruptcy Code of 1978, as amended,  or
any other similar  applicable  federal or state law, and the  continuance of any
such decree or order  unvacated  and  unstayed  for a period of 90 days;  or the
commencement of an involuntary  case under the United States  Bankruptcy Code of
1978, as amended,  in respect of such Person,  which shall continue  undismissed
for a period of 90 days or entry of an order for  relief  in such  case;  or the
entry of a decree or order of a court  having  jurisdiction  in the premises for
the  appointment  on the  ground of  insolvency  or  bankruptcy  of a  receiver,
custodian,  liquidator,  trustee or assignee in bankruptcy or insolvency of such
Person or of its property,  or for the winding up or liquidation of its affairs,
and such decree or order shall have remained in force unvacated and unstayed for
a period of 90 days; or

         (b) the  institution  by such Person of proceedings to be adjudicated a
voluntary bankrupt,  or the consent by such Person to the filing of a bankruptcy
proceeding  against  it, or the filing by such Person of a petition or answer or
consent seeking liquidation or reorganization under the United States Bankruptcy
Code of 1978, as amended,  or other similar  applicable Federal or State law, or
the  consent  by such  Person  to the  filing  of any  such  petition  or to the
appointment on the ground of insolvency or bankruptcy of a receiver or custodian
or  liquidator or trustee or assignee in bankruptcy or insolvency of such Person
or of its  property,  or shall  make a general  assignment  for the  benefit  of
creditors.

         "Bankruptcy Laws" has the meaning specified in Section 1009.

         "Board  Resolution"  means  a copy  of a  resolution  certified  by the
Secretary or an Assistant  Secretary of the  Depositor to have been duly adopted
by the  Depositor's  Board  of  Directors,  or such  committee  of the  Board of
Directors or officers of the  Depositor  to which  authority to act on behalf of
the Board of Directors has been delegated, and to be in full force and effect on
the date of such certification, and delivered to the appropriate Trustee.

         "Business  Day" means a day other than a Saturday  or Sunday,  a day on
which banking institutions in The City of New York are authorized or required by
law,  executive  order or  regulation  to remain  closed,  or a day on which the
Property  Trustee's  Corporate Trust Office or the Corporate Trust Office of the
Debenture Trustee is closed for business.

         "Certificate  of Trust" means the  certificate  of trust filed with the
Secretary  of State of the State of  Delaware  with  respect  to the  Trust,  as
amended or restated from time to time.

          "Change  in 1940 Act Law"  shall  have the  meaning  set  forth in the
definition of "Investment Company Event."

          "Closing  Date" means the date of execution and delivery of this Trust
Agreement.

         "Code" means the Internal Revenue Code of 1986, as amended.

         "Commission" means the Securities and Exchange Commission, as from time
to time  constituted,  created  under the Exchange Act, or, if at any time after

<PAGE>

the execution of this  instrument such Commission is not existing and performing
the duties  now  assigned  to it under the Trust  Indenture  Act,  then the body
performing such duties at such time.

         "Common Security" means an undivided  beneficial interest in the assets
of the Trust,  having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement,  including the right to receive  Distributions
and a Liquidation Distribution as provided herein.

         "Common  Securities   Certificate"   means  a  certificate   evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.

         "Corporate  Trust Office" means the office at which,  at any particular
time,  the  corporate  trust  business of the Property  Trustee or the Debenture
Trustee, as the case may be, shall be principally administered,  which office at
the date hereof, in each such case, is located at Two  International  Place, 4th
Floor, Boston, Massachusetts 02110, Attention: Corporate Trust Department.

         "Debenture  Event of Default" means an "Event of Default" as defined in
Section 7.1 of the Indenture.

         "Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.

         "Debenture  Tax Event"  means a "Tax Event" as specified in Section 1.1
of the Indenture.

         "Debenture  Trustee"  means  State  Street  Bank and Trust  Company,  a
banking   corporation   organized   under  the  laws  of  the   Commonwealth  of
Massachusetts and any successor thereto, as trustee under the Indenture.

         "Debentures"  means the $88,917,550  aggregate  principal amount of the
Depositor's  9.25%  Subordinated  Debentures  due 2027,  issued  pursuant to the
Indenture.

         "Definitive  Preferred  Securities  Certificates"  means the  Preferred
Securities  Certificates  issued  in  certificated,  fully  registered  form  as
provided in Section 513.

          "Delaware  Bank" has the  meaning  specified  in the  Preamble to this
Trust Agreement.

          "Delaware  Business  Trust  Act"  means  Chapter 38 of Title 12 of the
Delaware  Code, 12 Delaware Code Sections 3801 et seq. as it may be amended from
time to time.

         "Delaware   Trustee"  means  the  commercial   bank  or  trust  company
identified  as the  "Delaware  Trustee" in the Preamble to this Trust  Agreement
solely in its  capacity as Delaware  Trustee of the Trust  formed and  continued
hereunder and not in its  individual  capacity,  or its successor in interest in
such capacity, or any successor trustee appointed as herein provided.

          "Depositor"  has the meaning  specified  in the Preamble to this Trust
Agreement.
<PAGE>

         "Distribution Date" has the meaning specified in Section 401(a).

         "Distributions"   means  amounts   payable  in  respect  of  the  Trust
Securities as provided in Section 401.

         "Event of Default" means any one of the following  events (whatever the
reason  for  such  Event of  Default  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 a Debenture Event of Default; or

         (b) default by the Trust or the Property Trustee in the payment of  any
Distribution  when it becomes due and payable, and continuation of such default 
for a period of 30 days; or

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

         (d) default in the performance,  or breach, in any material respect, of
any covenant or warranty of the Trustees in this Trust  Agreement  (other than a
covenant  or  warranty  a default in the  performance  of which or the breach of
which is dealt  with in  clause  (b) or (c),  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  defaulting  Trustee or Trustees by the
Holders of at least 25% in aggregate  liquidation  preference of the Outstanding
Preferred  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

         (e) the  occurrence of a Bankruptcy  Event with respect to the Property
Trustee and the failure by the Depositor to appoint a successor Property Trustee
within 60 days thereof.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended.

         "Expense  Agreement" means the Agreement as to Expenses and Liabilities
between  the  Depositor  and the Trust,  substantially  in the form  attached as
Exhibit D, as amended from time to time.

         "Expiration Date" has the meaning specified in Section 901.

          "Extended  Interest  Payment  Period"  has the  meaning  specified  in
Section 4.1 of the Indenture.

         "Guarantee" means the Preferred Securities Guarantee Agreement executed
and  delivered  by the  Depositor  and State Street Bank and Trust  Company,  as
trustee,  contemporaneously  with  the  execution  and  delivery  of this  Trust
Agreement,  for the  benefit of the  holders  of the  Preferred  Securities,  as
amended from time to time.

         "Indenture" means the Indenture,  dated as of February 4, 1997, between
the Depositor and the Debenture Trustee,  as trustee, as amended or supplemented
from time to time.
<PAGE>

         "Investment  Company Act," means the Investment Company Act of 1940, as
amended, as in effect at the date of execution of this instrument.

         "Investment Company Event" means the receipt by the Trust of an Opinion
of  Counsel,  rendered  by a law  firm  having  a  recognized  national  tax and
securities law practice,  to the effect that, as a result of the occurrence of a
change in law or regulation or a change in  interpretation or application of law
or regulation by any legislative body, court,  governmental agency or regulatory
authority (a "Change in 1940 Act Law"),  the Trust is or shall be  considered an
"investment  company"  that is required to be  registered  under the  Investment
Company Act, which Change in 1940 Act Law becomes effective on or after the date
of original issuance of the Preferred Securities under this Trust Agreement.

         "Lien" means any lien, pledge, charge,  encumbrance,  mortgage, deed of
trust, adverse ownership interest, hypothecation,  assignment, security interest
or preference,  priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.

         "Like  Amount"  means  (a)  with  respect  to  a  redemption  of  Trust
Securities,  Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures  to be  contemporaneously  redeemed in accordance  with the
Indenture and the proceeds of which shall be used to pay the Redemption Price of
such Trust  Securities;  and (b) with respect to a distribution of Debentures to
Holders of Trust  Securities in connection  with a termination or liquidation of
the Trust,  Debentures having a principal amount equal to the Liquidation Amount
of the Trust  Securities of the Holder to whom such Debentures are  distributed.
Each  Debenture  distributed  pursuant  to clause (b) above  shall carry with it
accumulated  interest in an amount equal to the  accumulated and unpaid interest
then due on such Debentures.

         "Liquidation Amount" means the stated amount of $25 per Trust Security.

         "Liquidation  Date"  means  the  date  on  which  Debentures  are to be
distributed to Holders of Trust  Securities in connection with a termination and
liquidation of the Trust pursuant to Section 904(a).

         "Liquidation Distribution" has the meaning specified in Section 904(d).

         "Officers'  Certificate" means a certificate signed by the President or
a  Vice  President  and  by  the  Treasurer  or an  Assistant  Treasurer  or the
Controller  or  an  Assistant  Controller  or  the  Secretary  or  an  Assistant
Secretary,  of the Depositor,  and delivered to the appropriate  Trustee. One of
the officers  signing an  Officers'  Certificate  given  pursuant to Section 816
shall  be the  principal  executive,  financial  or  accounting  officer  of the
Depositor. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:

         (a) a statement that each officer  signing  the  Officers'  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  Officers'
Certificate;
<PAGE>

         (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.

         "Opinion of Counsel" means an opinion in writing of legal counsel,  who
may be counsel for the Trust, the Property Trustee,  the Delaware Trustee or the
Depositor,  but not an  employee  of any  thereof,  and who shall be  reasonably
acceptable to the Property Trustee.

          "Original Trust  Agreement" has the meaning  specified in the Recitals
to this Trust Agreement.

         "Outstanding",  when used with respect to Preferred Securities,  means,
as of the date of determination,  all Preferred Securities  theretofore executed
and delivered under this Trust Agreement, except:

         (a Preferred  securities  theretofore  canceled by the Property Trustee
or delivered to the Property Trustee for cancellation;

         (b) Preferred  Securities for whose payment or redemption  money in the
necessary amount has been theretofore deposited with the Property Trustee or any
Paying Agent for the Holders of such  Preferred  Securities;  provided  that, if
such Preferred Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Trust Agreement; and

         (c) Preferred  Securities which have been paid or in exchange for or in
lieu of which  other  Preferred  Securities  have been  executed  and  delivered
pursuant  to  Sections  504,  505,  511  and  513;  provided,  however,  that in
determining  whether  the  Holders of the  requisite  Liquidation  Amount of the
Outstanding Preferred Securities have given any request, demand,  authorization,
direction,  notice,  consent or waiver hereunder,  Preferred Securities owned by
the  Depositor,  any Trustee or any  Affiliate  of the  Depositor or any Trustee
shall be  disregarded  and  deemed  not to be  Outstanding,  except  that (a) in
determining  whether any Trustee  shall be  protected  in relying  upon any such
request,  demand,  authorization,  direction,  notice,  consent or waiver,  only
Preferred  Securities  that  such  Trustee  knows  to be so  owned  shall  be so
disregarded;  and (b) the foregoing  shall not apply at any time when all of the
outstanding Preferred Securities are owned by the Depositor,  one or more of the
Trustees  and/or any such  Affiliate.  Preferred  Securities so owned which have
been  pledged  in good  faith may be  regarded  as  Outstanding  if the  pledgee
establishes to the  satisfaction  of the  Administrative  Trustees the pledgee's
right so to the Depositor or any Affiliate of the Depositor.

         "Paying  Agent"  means any paying agent or  co-paying  agent  appointed
pursuant to Section 509 and shall initially be the Bank.

         "Payment  Account"  means a segregated  non-interest-bearing  corporate
trust  account  maintained  by the  Property  Trustee with the Bank in its trust
department for the benefit of the  Securityholders  in which all amounts paid in
respect  of the  Debentures  shall be held and from which the  Property  Trustee
shall make payments to the  Securityholders  in accordance with Sections 401 and
402.
<PAGE>

         "Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation,  unincorporated organization or
government or any agency or political subdivision thereof.

         "Preferred  Security"  means an  undivided  beneficial  interest in the
assets of the Trust,  having a  Liquidation  Amount of $25 and having the rights
provided  therefor  in this  Trust  Agreement,  including  the right to  receive
Distributions and a Liquidation Distribution as provided herein.

         "Preferred  Securities  Certificate",  means a  certificate  evidencing
ownership of Preferred Securities, substantially in the form attached as Exhibit
E.

         "Property   Trustee"  means  the  commercial   bank  or  trust  company
identified  as the "Property  Trustee," in the Preamble to this Trust  Agreement
solely in its capacity as Property  Trustee of the Trust  heretofore  formed and
continued  hereunder  and not in its  individual  capacity,  or its successor in
interest in such capacity, or any successor property trustee appointed as herein
provided.

         "Redemption  Date"  means,  with  respect to any Trust  Security  to be
redeemed,  the date  fixed for such  redemption  by or  pursuant  to this  Trust
Agreement;  provided that each Debenture Redemption Date and the stated maturity
of the  Debentures  shall  be a  Redemption  Date  for a Like  Amount  of  Trust
Securities.

         "Redemption  Price"  means,  with  respect to any Trust  Security,  the
Liquidation  Amount  of  such  Trust  Security,   plus  accumulated  and  unpaid
Distributions  to the Redemption Date, paid by the Depositor upon the concurrent
redemption of a Like Amount of Debentures,  allocated on a pro rata basis (based
on Liquidation Amounts) among the Trust Securities.

         "Relevant Trustee" shall have the meaning specified in Section 810.

         "Securities  Register" and  "Securities  Registrar" have the respective
meanings specified in Section 504.

         "Securityholder"  or  "Holder"  means a Person  in  whose  name a Trust
Security or Securities is registered in the Securities Register; any such Person
is a beneficial owner within the meaning of the Delaware Business Trust Act.

         "Trust" means the Delaware  business trust created and continued hereby
and identified on the cover page to this Trust Agreement.

         "Trust  Agreement" means this Amended and Restated Trust Agreement,  as
the same  may be  modified,  amended  or  supplemented  in  accordance  with the
applicable provisions hereof, including all exhibits hereto,  including, for all
purposes  of this  Trust  Agreement  and any  such  modification,  amendment  or
supplement,  the  provisions of the Trust  Indenture Act that are deemed to be a
part of and govern this Trust Agreement and any such modification,  amendment or
supplement, respectively.
<PAGE>

         "Trust  Indenture  Act"  means  the  Trust  Indenture  Act of 1939,  as
amended,  as in  force at the date as of which  this  instrument  was  executed;
provided,  however,  that in the  event  the  Trust  Indenture  Act of 1939,  as
amended,  is amended after such date, "Trust Indenture Act" means, to the extent
required by any such amendment, the Trust Indenture Act of 1939 as so amended.

         "Trust  Property"  means  (a) the  Debentures;  (b) the  rights  of the
Property  Trustee under the Guarantee;  (c) any cash on deposit in, or owing to,
the Payment Account; and (d) 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 Property Trustee pursuant to the trusts of this Trust Agreement.

          "Trust  Security"  means  any  one of  the  Common  Securities  or the
Preferred Securities.

          "Trust Securities  Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.

          "Trustees" means,  collectively,  the Property  Trustee,  the Delaware
Trustee and the Administrative Trustees.

         "Underwriting Agreement" means the Underwriting Agreement,  dated as of
January  29,  1997 and  amended as of January  30,  1997,  among the Trust,  the
Depositor and the Underwriters named therein.


                                   ARTICLE II
                           ESTABLISHMENT OF THE TRUST

         Section 201.  Name.

         The  Trust  created  and  continued  hereby  shall be  known as  "First
Preferred  Capital Trust," as such name may be modified from time to time by the
Administrative  Trustees  following  written  notice  to the  Holders  of  Trust
Securities and the other Trustees,  in which name the Trustees may engage in the
transactions   contemplated   hereby,  make  and  execute  contracts  and  other
instruments on behalf of the Trust and sue and be sued.

          Section  202.  Office  of the  Delaware  Trustee;  Principal  Place of
Business.

         The  address of the  Delaware  Trustee in the State of  Delaware is c/o
Wilmington  Trust  Company,  Rodney  Square  North,  1100 North  Market  Street,
Wilmington, Delaware 19890-0001,  Attention: Corporate Trust Administration,  or
such  other  address  in the  State of  Delaware  as the  Delaware  Trustee  may
designate  by  written  notice to the  Securityholders  and the  Depositor.  The
principal  executive  office of the Trust is c/o First  Banks,  Inc.,  135 North
Meramec Avenue, St. Louis, Missouri 63105.

          Section 203.  Initial  Contribution of Trust Property;  Organizational
Expenses.

         The  Trustees  acknowledge  receipt  in  trust  from the  Depositor  in
connection  with  the  Original  Trust  Agreement  of  the  sum  of  $10,  which

<PAGE>

constituted the initial Trust Property.  The Depositor shall pay  organizational
expenses  of the Trust as they  arise or shall,  upon  request  of any  Trustee,
promptly reimburse such Trustee for any such expenses paid by such Trustee.  The
Depositor  shall make no claim upon the Trust  Property  for the payment of such
expenses.

         Section 204.  Issuance of the Preferred Securities.

         On January 29, 1997, the Depositor and an  Administrative  Trustee,  on
behalf of the Trust and pursuant to the Original Trust  Agreement,  executed and
delivered the Underwriting  Agreement. On January 30, 1997, the Depositor and an
Administrative  Trustee,  on behalf of the Trust and  pursuant  to the  Original
Trust Agreement,  executed and delivered the First Amendment to the Underwriting
Agreement.  Contemporaneously  with the  execution  and  delivery  of this Trust
Agreement,  an Administrative  Trustee, on behalf of the Trust, shall execute in
accordance  with  Section 502 and deliver in  accordance  with the  Underwriting
Agreement,  Preferred  Securities  Certificates,  registered  in the name of the
Persons  entitled  thereto,  in an  aggregate  amount of  $86,250,000  Preferred
Securities having an aggregate Liquidation Amount of $86,250,000 against receipt
of the aggregate  purchase  price of such Preferred  Securities of  $86,250,000,
which amount such Administrative  Trustee shall promptly deliver to the Property
Trustee.

          Section  205.  Issuance  of the Common  Securities;  Subscription  and
Purchase of Debentures.

         Contemporaneously  with  the  execution  and  delivery  of  this  Trust
Agreement,  an Administrative  Trustee, on behalf of the Trust, shall execute in
accordance  with  Section 502 and deliver to the  Depositor,  Common  Securities
Certificates, registered in the name of the Depositor, in an aggregate amount of
Common Securities having an aggregate  Liquidation  Amount of $2,667,550 against
payment  by the  Depositor  of  such  amount.  Contemporaneously  therewith,  an
Administrative  Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Depositor Debentures, registered in the name of the Property Trustee on
behalf  of  the  Trust  and  having  an  aggregate  principal  amount  equal  to
$88,917,550, and, in satisfaction of the purchase price for such Debentures, the
Property Trustee, on behalf of the Trust, shall deliver to the Depositor the sum
of $88,917,550.

         Section 206.  Declaration of Trust.

         The exclusive  purposes and functions of the Trust are (a) to issue and
sell  Trust  Securities  and use the  proceeds  from  such sale to  acquire  the
Debentures;  and (b) to  engage in those  activities  necessary,  convenient  or
incidental  thereto.  The Depositor  hereby appoints the Trustees as trustees of
the  Trust,  to have all the  rights,  powers and duties to the extent set forth
herein,  and the Trustees hereby accept such  appointment.  The Property Trustee
hereby  declares that it shall hold the Trust Property in trust upon and subject
to the conditions set forth herein for the benefit of the  Securityholders.  The
Administrative  Trustees  shall  have all  rights,  powers  and duties set forth
herein and in accordance with applicable law with respect to  accomplishing  the
purposes of the Trust.  The Delaware  Trustee  shall not be entitled to exercise
any  powers,  nor  shall  the  Delaware  Trustee  have  any  of the  duties  and
responsibilities,  of the Property  Trustee or the  Administrative  Trustees set
forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for

<PAGE>

the sole and limited  purpose of fulfilling the  requirements of Section 3807 of
the Delaware Business Trust Act.

         Section 207.  Authorization to Enter into Certain Transactions.

         (a) The Trustees  shall  conduct the affairs of the Trust in accordance
with the terms of this Trust Agreement.  Subject to the limitations set forth in
paragraph (b) of this Section 207 and Article VIII,  and in accordance  with the
following  provisions (i) and (ii), the  Administrative  Trustees shall have the
authority  to enter  into all  transactions  and  agreements  determined  by the
Administrative  Trustees to be appropriate in exercising the authority,  express
or implied,  otherwise granted to the  Administrative  Trustees under this Trust
Agreement,  and to perform all acts in furtherance  thereof,  including  without
limitation, the following:

                  (i)......As among the Trustees,  each Administrative  Trustee,
acting singly or jointly, shall have the power and authority to act on behalf of
the Trust with respect to the following matters:

                  .........(A)    the issuance and sale of the Trust Securities;

                  .........(B)    to  cause  the  Trust  to enter  into,  and to
execute,  deliver  and  perform  on behalf of the  Trust, the  Expense Agreement
and such other  agreements  or  documents  as may be  necessary or desirable in 
connection with the purposes and function of the Trust;

                  .........(C)    assisting in the registration of the Preferred
Securities  under  the  Securities Act of 1933,  as   amended,  and under  state
securities  or blue sky laws,  and the  qualification  of  this  Trust Agreement
as a trust indenture under the Trust Indenture Act;

                  .........(D)   assisting  in  the  listing  of  the  Preferred
Securities  upon The Nasdaq Stock Market's  National  Market or such  securities
exchange  or  exchanges  as  shall  be  determined  by  the  Depositor  and  the
registration  of the  Preferred  Securities  under  the  Exchange  Act,  and the
preparation  and filing of all  periodic and other  reports and other  documents
pursuant to the foregoing;

                  .........(E)   the sending of notices  (other  than notices of
default) and other information regarding the Trust Securities and the Debentures
to the Securityholders in accordance with this Trust Agreement;

                  .........(F)   the    appointment   of   a      Paying  Agent,
authenticating  agent  and  Securities Registrar in  accordance  with this Trust
Agreement;

                  .........(G)   to the extent provided in this Trust Agreement,
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; 

                  .........(H)   to take  all action  that may be  necessary  or
appropriate  for the  preservation  and the  continuation  of the Trust's  valid
existence, rights, franchises and privileges as a statutory business trust under
the laws of the State of Delaware and of each other  jurisdiction  in which such
existence is  necessary  to protect the limited  liability of the Holders of the
Preferred Securities or to enable the Trust to effect the purposes for which the
Trust was created; and
<PAGE>

                  .........(I)   the taking of any  action  incidental   to  the
foregoing  as the  Administrative Trustees  may from time to time  determine  is
necessary  or advisable  to give effect to the terms of this Trust Agreement for
the benefit of the  Securityholders (without consideration  of the effect of any
such action on any particular Securityholder).

          (ii).....As  among the Trustees,  the Property  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 Payment 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 Payment Account;

                  .........(D)      the  distribution  of  amounts  owed to the
Securityholders  in respect of the Trust Securities in accordance with the terms
of this Trust Agreement;

                  .........(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  Trust  Securities  and   the   Debentures   to  the
Securityholders in accordance with this Trust Agreement;

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

                  .........(H)      to  the   extent   provided  in  this  Trust
Agreement,  the winding up of the affairs of and liquidation of the Trust;

                  .........(I)  after an Event of  Default,  the  taking  of any
action incidental to the foregoing as the Property Trustee may from time to time
determine  is  necessary  or advisable to give effect to the terms of this Trust
Agreement  and protect and  conserve  the Trust  Property for the benefit of the
Securityholders  (without  consideration of the effect of any such action on any
particular Securityholder);

                  .........(J)      registering   transfers  of    the    Trust
Securities in  accordance  with this Trust Agreement; and

                  .........(K)      except as otherwise provided in this Section
207(a)(ii),  the Property Trustee shall have none of  the  duties,  liabilities,
powers or the authority of the  Administrative  Trustees set  forth  in  Section
207(a)(i).

         (b) So long as this Trust  Agreement  remains in effect,  the Trust (or
the Trustees  acting on behalf of the Trust) shall not  undertake  any business,
activities or transaction  except as expressly  provided  herein or contemplated
hereby.  In particular,  the Trustees  shall not (i) acquire any  investments or
engage in any  activities  not  authorized by this Trust  Agreement;  (ii) sell,
assign, transfer,  exchange,  mortgage,  pledge, set-off or otherwise dispose of
any of the Trust Property or interests  therein,  including to  Securityholders,

<PAGE>

except as expressly provided herein;  (iii) take any action that would cause the
Trust to fail or cease to qualify as a "grantor trust" for United States federal
income tax purposes; (iv) incur any indebtedness for borrowed money or issue any
other  debt;  or (v) take or  consent to any  action  that  would  result in the
placement of a Lien on any of the Trust Property.  The  Administrative  Trustees
shall 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
Securityholders in their capacity as Securityholders.

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

                  (i)......the  preparation  and  filing by the  Trust  with the
Commission and the execution on behalf of the Trust of a registration  statement
on the  appropriate  form  in  relation  to the  Preferred  Securities  and  the
Debentures, including any amendments thereto;

                  (ii).....the  determination  of the  states  in  which to take
appropriate action to qualify or, register for sale all or part of the Preferred
Securities  and to do any and all such acts,  other than  actions  which must be
taken by or on behalf of the Trust, and advise the Trustees of actions they must
take on behalf of the Trust,  and prepare for execution and filing any documents
to be  executed  and  filed  by the  Trust or on  behalf  of the  Trust,  as the
Depositor  deems  necessary or advisable in order to comply with the  applicable
laws of any such States;

                  (iii)....the preparation for filing by the Trust and execution
on behalf of the Trust of an application  to The Nasdaq Stock Market's  National
Market or a national  stock  exchange or other  organizations  for listing  upon
notice  of  issuance  of any  Preferred  Securities  and to  file  or  cause  an
Administrative  Trustee to file  thereafter  with such exchange or  organization
such notifications and documents as may be necessary from time to time;

                  (iv).....the  preparation  for  filing by the  Trust  with the
Commission and the execution on behalf of the Trust of a registration  statement
on Form 8-A  relating to the  registration  of the  Preferred  Securities  under
Section 12(b) or 12(g) of the Exchange Act, including any amendments thereto;

                  (v)......the  negotiation  of the terms of, and the execution
and delivery of, the  Underwriting Agreement providing  for  the  sale  of  the
Preferred Securities; and

                  (vi).....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 Administrative
Trustees are  authorized and directed to conduct the affairs of the Trust and to
operate  the  Trust so that the Trust  shall not be deemed to be an  "investment
company"  required to be registered  under the Investment  Company Act, shall be
classified  as a  "grantor  trust"  and  not  as  an  association  taxable  as a
corporation  for  United  States  federal  income tax  purposes  and so that the
Debentures  shall be treated as  indebtedness of the Depositor for United States

<PAGE>

federal income tax purposes.  In this  connection,  subject to Section 1002, the
Depositor and the Administrative Trustees are authorized to take any action, not
inconsistent  with  applicable  law or this  Trust  Agreement,  that each of the
Depositor and the Administrative  Trustees  determines in their discretion to be
necessary or desirable for such purposes.

         Section 208.  Assets of Trust.

         The assets of the Trust shall consist of the Trust Property.

         Section 209.  Title to Trust Property.

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


                                  ARTICLE III.
                                 PAYMENT ACCOUNT

         Section 301.  Payment Account.

         (a) On or  prior  to the  Closing  Date,  the  Property  Trustee  shall
establish  the  Payment  Account.  The  Property  Trustee  and any  agent of the
Property Trustee shall have exclusive  control and sole right of withdrawal with
respect  to  the  Payment  Account  for  the  purpose  of  making  deposits  and
withdrawals  from the Payment Account in accordance  with this Trust  Agreement.
All monies and other property deposited or held from time to time in the Payment
Account  shall be held by the  Property  Trustee in the Payment  Account for the
exclusive  benefit  of  the  Securityholders  and  for  distribution  as  herein
provided,  including  (and  subject to) any  priority of payments  provided  for
herein.

         (b) The Property Trustee shall deposit in the Payment Account, promptly
upon  receipt,  all  payments  of  principal  of or  interest  on, and any other
payments  or  proceeds  with  respect to, the  Debentures.  Amounts  held in the
Payment  Account  shall  not  be  invested  by  the  Property   Trustee  pending
distribution thereof.


                                   ARTICLE IV
                            DISTRIBUTIONS; REDEMPTION

         Section 401.  Distributions.

         (a)  Distributions  on the Trust  Securities  shall be cumulative,  and
shall  accumulate  whether or not there are funds of the Trust available for the
payment of Distributions.  Distributions shall accumulate from February 4, 1997,
and,  except  during any Extended  Interest  Payment  Period with respect to the
Debentures,  shall  be  payable  quarterly  in  arrears  on March  31,  June 30,
September 30 and December 31 of each year,  commencing on March 31, 1997. If any
date on which a Distribution is otherwise payable on the Trust Securities is not
a Business Day, then the payment of such Distribution  shall be made on the next
succeeding day that is a Business Day (and without any interest or other payment

<PAGE>

in respect of any such  delay) with the same force and effect as if made on such
date (each date on which  distributions  are  payable  in  accordance  with this
Section 401(a), a "Distribution Date").

         (b) The Trust Securities  represent undivided  beneficial  interests in
the Trust Property,  and, as a practical matter,  the Distributions on the Trust
Securities  shall be  payable  at a rate of 9.25% per  annum of the  Liquidation
Amount of the Trust Securities. The amount of Distributions payable for any full
period shall be computed on the basis of a 360-day year of twelve 30-day months.
The amount of  Distributions  for any  partial  period  shall be computed on the
basis of the number of days  elapsed in a 360-day  year of twelve 30 day months.
During any Extended  Interest  Payment  Period with  respect to the  Debentures,
Distributions  on the Preferred  Securities shall be deferred for a period equal
to the Extended Interest Payment Period. The amount of Distributions payable for
any period shall include the Additional Amounts, if any.

         (c) Distributions on the Trust Securities shall be made by the Property
Trustee  solely  from  the  Payment   Account  and  shall  be  payable  on  each
Distribution  Date only to the extent  that the Trust has funds then on hand and
immediately  available  by 12:30 p.m. on each  Distribution  Date in the Payment
Account for the payment of such Distributions.

         (d)   Distributions   on  the  Trust   Securities  with  respect  to  a
Distribution  Date shall be payable to the Holders thereof as they appear on the
Securities  Register for the Trust Securities on the relevant record date, which
shall be the 15th day of the month in which the Distribution is payable.

         Section 402.  Redemption.

         (a) On each Debenture Redemption Date and on the stated maturity of the
Debentures,  the  Trust  shall be  required  to  redeem a Like  Amount  of Trust
Securities at the Redemption Price.

         (b)  Notice of  redemption  shall be given by the  Property  Trustee by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date to each Holder of Trust  Securities to be redeemed,
at such Holder's  address  appearing in the  Securities  Register.  The Property
Trustee  shall  have no  responsibility  for the  accuracy  of any CUSIP  number
contained in such notice. All notices of redemption shall state:

                  (i)......the Redemption Date;

                  (ii).....the Redemption Price;

                  (iii)....the CUSIP number;

                  (iv).....if less than all the Outstanding Trust Securities are
to be redeemed,  the identification and the aggregate  Liquidation Amount of the
particular Trust Securities to be redeemed; and

                  (v)......that,  on  the  Redemption   Date,   the   Redemption
Price shall become due and payable upon each such Trust  Security to be redeemed
and that  Distributions  thereon  shall cease to  accumulate on  and  after said
date.


<PAGE>

         (c) The Trust  Securities  redeemed  on each  Redemption  Date shall be
redeemed at the  Redemption  Price with the  proceeds  from the  contemporaneous
redemption of Debentures.  Redemptions of the Trust Securities shall be made and
the Redemption Price shall be payable on each Redemption Date only to the extent
that the Trust has immediately available funds then on hand and available in the
Payment Account for the payment of such Redemption Price.

         (d) If the Property  Trustee gives a notice of redemption in respect of
any  Preferred  Securities,  then,  by 12:00  noon,  New York City time,  on the
Redemption Date,  subject to Section 402(c),  the Property Trustee shall deposit
with the Paying Agent funds  sufficient to pay the applicable  Redemption  Price
and shall give the Paying Agent  irrevocable  instructions  and authority to pay
the Redemption  Price to the Holders  thereof upon surrender of their  Preferred
Securities Certificates. Notwithstanding the foregoing, Distributions payable on
or prior to the Redemption Date for any Trust  Securities  called for redemption
shall be payable to the Holders of such Trust  Securities  as they appear on the
Register for the Trust  Securities on the relevant  record dates for the related
Distribution  Dates.  If notice of  redemption  shall  have been given and funds
deposited  as  required,  then  upon the date of such  deposit,  all  rights  of
Securityholders  holding Trust  Securities so called for redemption shall cease,
except the right of such Securityholders to receive the Redemption Price and any
Distribution  payable on or prior to the Redemption Date, but without  interest,
and such Securities shall cease to be Outstanding. In the event that any date on
which any Redemption Price is payable is not a Business Day, then payment of the
Redemption  Price payable on such date shall be made on the next  succeeding day
that is a Business Day (and without any interest or other  payment in respect of
any such delay)  with the same force and effect as if made on such date.  In the
event that payment of the  Redemption  Price in respect of any Trust  Securities
called for  redemption is improperly  withheld or refused and not paid either by
the Trust or by the Depositor  pursuant to the Guarantee,  Distributions on such
Trust Securities shall continue to accumulate, at the then applicable rate, from
the  Redemption  Date  originally  established  by  the  Trust  for  such  Trust
Securities to the date such Redemption Price is actually paid, in which case the
actual  payment  date shall be the date fixed for  redemption  for  purposes  of
calculating the Redemption Price.

         (e) Payment of the Redemption  Price on the Trust  Securities  shall be
made to the record holders thereof as they appear on the Securities Register for
the Trust  Securities  on the relevant  record date,  which shall be the date 15
days prior to the relevant Redemption Date.

         (f) Subject to Section 403(a),  if less than all the Outstanding  Trust
Securities  are  to  be  redeemed  on a  Redemption  Date,  then  the  aggregate
Liquidation  Amount of Trust  Securities to be redeemed  shall be allocated on a
pro rata basis (based on Liquidation  Amounts)  among the Common  Securities and
the Preferred  Securities.  The particular  Preferred  Securities to be redeemed
shall be  selected  not more than 60 days  prior to the  Redemption  Date by the
Property Trustee from the outstanding Preferred Securities not previously called
for redemption,  by such method (including,  without limitation,  by lot) as the
Property  Trustee shall deem fair and  appropriate and which may provide for the
selection for  redemption of portions  (equal to $25 or an integral  multiple of
$25 in excess  thereof) of the Liquidation  Amount of Preferred  Securities of a
denomination  larger than $25. The Property  Trustee shall  promptly  notify the
Securities  Registrar  in  writing  of the  Preferred  Securities  selected  for
redemption  and, in the case of any  Preferred  Securities  selected for partial

<PAGE>

redemption,  the Liquidation Amount thereof to be redeemed.  For all purposes of
this Trust  Agreement,  unless the context  otherwise  requires,  all provisions
relating to the redemption of Preferred  Securities shall relate, in the case of
any Preferred Securities redeemed or to be redeemed only in part, to the portion
of the  Liquidation  Amount of Preferred  Securities  which has been or is to be
redeemed.

         Section 403.  Subordination of Common Securities.

         (a)  Payment  of  Distributions   (including   Additional  Amounts,  if
applicable)  on,  and  the  Redemption  Price  of,  the  Trust  Securities,   as
applicable,  shall be made, subject to Section 402(f), pro rata among the Common
Securities and the Preferred  Securities based on the Liquidation  Amount of the
Trust  Securities;  provided,  however,  that  if on any  Distribution  Date  or
Redemption Date any Event of Default resulting from a Debenture Event of Default
shall have occurred and be continuing, no payment of any Distribution (including
Additional  Amounts,  if  applicable)  on, or  Redemption  Price of,  any Common
Security,  and no other  payment on account of the  redemption,  liquidation  or
other acquisition of Common Securities,  shall be made unless payment in full in
cash of all accumulated and unpaid Distributions  (including Additional Amounts,
if  applicable) on all  Outstanding  Preferred  Securities for all  Distribution
periods  terminating  on or  prior  thereto,  or in the case of  payment  of the
Redemption  Price the full amount of such  Redemption  Price on all  Outstanding
Preferred  Securities  then  called  for  redemption,  shall  have  been made or
provided for, and all funds immediately  available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions  (including
Additional  Amounts,  if applicable) on, or the Redemption  Price of,  Preferred
Securities then due and payable.

         (b) In the case of the  occurrence  of any Event of  Default  resulting
from a Debenture  Event of  Default,  the Holder of Common  Securities  shall be
deemed to have waived any right to act with respect to any such Event of Default
under this Trust  Agreement  until the effect of all such Events of Default with
respect to the Preferred  Securities shall have been cured,  waived or otherwise
eliminated.  Until any such Event of Default  under  this Trust  Agreement  with
respect  to the  Preferred  Securities  shall  have  been so  cured,  waived  or
otherwise  eliminated,  the Property  Trustee  shall act solely on behalf of the
Holders of the Preferred Securities and not the Holder of the Common Securities,
and only the Holders of the Preferred  Securities shall have the right to direct
the Property Trustee to act on their behalf.

         Section 404.  Payment Procedures.

         Payments of Distributions (including Additional Amounts, if applicable)
in  respect of the  Preferred  Securities  shall be made by check  mailed to the
address  of the Person  entitled  thereto as such  address  shall  appear on the
Securities Register.  Payments in respect of the Common Securities shall be made
in such manner as shall be mutually agreed between the Property  Trustee and the
Common Securityholder.

         Section 405.  Tax Returns and Reports.

         The Administrative Trustees shall prepare (or cause to be prepared), at
the Depositor's expense, and file all United States federal, state and local tax
and information returns and reports required to be filed by or in respect of the
Trust. In this regard,  the  Administrative  Trustees shall (a) prepare and file

<PAGE>

(or cause to be prepared and filed) the  appropriate  Internal  Revenue  Service
Form  required to be filed in respect of the Trust in each  taxable  year of the
Trust;  and (b) prepare and furnish (or cause to be prepared and  furnished)  to
each Securityholder the appropriate Internal Revenue Service form required to be
furnished to such  Securityholder or the information  required to be provided on
such form. The  Administrative  Trustees shall provide the Depositor with a copy
of all such returns and reports  promptly after such filing or  furnishing.  The
Property Trustee shall comply with United States federal  withholding and backup
withholding tax laws and information reporting  requirements with respect to any
payments to Securityholders under the Trust Securities.

         Section 406.  Payment of Taxes, Duties, etc. of the Trust.

         Upon receipt under the Debentures of Additional Interest (as defined in
Section 1.1 of the  Indenture),  the Property  Trustee,  at the  direction of an
Administrative Trustee or the Depositor, shall promptly pay any taxes, duties or
governmental charges of whatsoever nature (other than withholding taxes) imposed
on the Trust by the United States or any other taxing authority.

         Section 407.  Payments Under Indenture.

         Any amount  payable  hereunder  to any Holder of  Preferred  Securities
shall be reduced  by the amount of any  corresponding  payment  such  Holder has
directly received under the Indenture pursuant to Section 514(b) or (c) hereof.


                                    ARTICLE V
                          TRUST SECURITIES CERTIFICATES

         Section 501.  Initial.

         Upon the creation of the Trust and the  contribution  by the  Depositor
pursuant to Section 203 and until the issuance of the Trust  Securities,  and at
any time during which no Trust Securities are  outstanding,  the Depositor shall
be the sole beneficial owner of the Trust.

         Section 502.  The Trust Securities.

         The  Preferred  Securities  Certificates  shall be  issued  in  minimum
denominations of $25 Liquidation  Amount and integral multiples of $25 in excess
thereof, and the Common Securities Certificates shall be issued in denominations
of $25 Liquidation Amount and integral  multiples thereof.  The Trust Securities
Certificates  shall be  executed  on behalf of the Trust by manual or  facsimile
signature of at least one Administrative  Trustee. Trust Securities Certificates
bearing the manual or facsimile  signatures of individuals who were, at the time
when such  signatures  shall have been affixed,  authorized to sign on behalf of
the Trust,  shall be validly  issued and  entitled to the benefits of this Trust
Agreement,  notwithstanding  that such  individuals  or any of them  shall  have
ceased  to be so  authorized  prior to the  delivery  of such  Trust  Securities
Certificates  or did not hold such offices at the date of delivery of such Trust
Securities  Certificates.  A transferee of a Trust Securities  Certificate shall
become a Securityholder,  and shall be entitled to the rights and subject to the

<PAGE>

obligations of a Securityholder  hereunder,  upon due registration of such Trust
Securities  Certificate in such  transferee's name pursuant to Sections 504, 511
and 513.

          Section  503.   Execution,   Authentication   and  Delivery  of  Trust
Securities Certificates.

         (a) On the  Closing  Date  and on the  date on  which  the  Underwriter
exercises  the  option,   as  applicable  (the  "Option   Closing  Date"),   the
Administrative  Trustees  shall  cause  Trust  Securities  Certificates,  in  an
aggregate Liquidation Amount as provided in Sections 204 and 205, to be executed
on  behalf  of the  Trust by at least  one of the  Administrative  Trustees  and
delivered  to or upon the written  order of the  Depositor,  signed by its Chief
Executive Officer, President, any Vice President, the Treasurer or any Assistant
Treasurer  without  further  corporate  action by the  Depositor,  in authorized
denominations.

         (b) A  Preferred  Securities  Certificate  shall  not  be  valid  until
authenticated by the manual signature of an authorized signatory of the Property
Trustee.   The  signature  shall  be  conclusive  evidence  that  the  Preferred
Securities  Certificate has been authenticated under this Trust Agreement.  Each
Preferred Security Certificate shall be dated the date of its authentication.

         Upon  the  written  order of the  Trust  signed  by the  Administrative
Trustee, the Property Trustee shall authenticate and make available for delivery
the Preferred Securities Certificates.

         The Property Trustee may appoint an Authenticating  Agent acceptable to
the Trust to authenticate the Preferred Securities.  An Authenticating Agent may
authenticate the Preferred  Securities  whenever the Property Trustee may do so.
Each reference in this Trust Agreement to authentication by the Property Trustee
includes  authentication  by such agent.  An  Authenticating  Agent has the same
rights as the Property Trustee to deal with the Company or the Trust.

          Section  504.  Registration  of Transfer  and  Exchange  of  Preferred
Securities Certificates.

         (a) The  Depositor  shall  keep or cause to be kept,  at the  office or
agency  maintained  pursuant  to Section  508, a register or  registers  for the
purpose of registering Trust Securities Certificates and transfers and exchanges
of Preferred  Securities  Certificates  (herein  referred to as the  "Securities
Register") in which the registrar  designated by the Depositor (the  "Securities
Registrar"),  subject to such reasonable regulations as it may prescribe,  shall
provide for the  registration of Preferred  Securities  Certificates  and Common
Securities  Certificates  (subject  to  Section  510 in the  case of the  Common
Securities   Certificates)  and  registration  of  transfers  and  exchanges  of
Preferred Securities Certificates as herein provided. The Property Trustee shall
be the initial Securities Registrar.

         (b) Upon  surrender  for  registration  of  transfer  of any  Preferred
Securities  Certificate at the office or agency  maintained  pursuant to Section
508, the  Administrative  Trustees or any one of them shall execute and deliver,
in the  name of the  designated  transferee  or  transferees,  one or  more  new
Preferred  Securities  Certificates  in  authorized   denominations  of  a  like
aggregate  Liquidation Amount dated the date of execution by such Administrative
Trustee or Trustees.  The Securities Registrar shall not be required to register

<PAGE>

the transfer of any Preferred  Securities  that have been called for redemption.
At the option of a Holder,  Preferred  Securities  Certificates may be exchanged
for other Preferred Securities  Certificates in authorized  denominations of the
same class and of a like  aggregate  Liquidation  Amount upon  surrender  of the
Preferred  Securities  Certificates  to be  exchanged  at the  office  or agency
maintained pursuant to Section 508.

         (c) Every Preferred Securities Certificate presented or surrendered for
registration  of  transfer  or  exchange  shall  be  accompanied  by  a  written
instrument  of transfer in form  satisfactory  to the  Property  Trustee and the
Securities Registrar duly executed by the Holder or his attorney duly authorized
in writing. Each Preferred Securities  Certificate  surrendered for registration
of transfer or exchange  shall be canceled and  subsequently  disposed of by the
Property Trustee in accordance with its customary practice.  The Trust shall not
be required to (i) issue,  register the  transfer of, or exchange any  Preferred
Securities during a period beginning at the opening of business 15 calendar days
before the date of mailing of a notice of redemption of any Preferred Securities
called for  redemption  and ending at the close of  business  on the day of such
mailing;  or (ii) register the transfer of or exchange any Preferred  Securities
so selected for redemption,  in whole or in part, except the unredeemed  portion
of any such Preferred Securities being redeemed in part.

         (d) No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates,  but the Securities Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be  imposed  in  connection  with any  transfer  or  exchange  of  Preferred
Securities Certificates.

          Section 505.  Mutilated,  Destroyed,  Lost or Stolen Trust  Securities
Certificates.

         If (a) any mutilated Trust Securities  certificate shall be surrendered
to the  Securities  Registrar,  or if the  Securities  Registrar  shall  receive
evidence  to its  satisfaction  of the  destruction,  loss or theft of any Trust
Securities  Certificate;  and (b) there  shall be  delivered  to the  Securities
Registrar and the  Administrative  Trustees such security or indemnity as may be
required  by them to save each of them  harmless,  then in the absence of notice
that such Trust Securities  Certificate  shall have been acquired by a bona fide
purchaser,  the  Administrative  Trustees,  or any one of them, on behalf of the
Trust shall execute and make available for delivery,  in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust  Securities  Certificate  of like class,  tenor and  denomination.  In
connection with the issuance of any new Trust Securities  Certificate under this
Section 505, the Administrative Trustees or the Securities Registrar 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  Trust  Securities
Certificate  issued  pursuant to this  Section 505 shall  constitute  conclusive
evidence of an undivided  beneficial  interest in the assets of the Trust, as if
originally issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.

         Section 506.  Persons Deemed Securityholders.

         The Trustees, the Paying Agent and the Securities Registrar shall treat
the Person in whose name any Trust Securities Certificate shall be registered in

<PAGE>

the Securities  Register as the owner of such Trust  Securities  Certificate for
the purpose of receiving  Distributions  and for all other purposes  whatsoever,
and neither the  Trustees  nor the  Securities  Registrar  shall be bound by any
notice to the contrary.

         Section 507.  Access to List of Securityholders' Names and Addresses.

         At any time  when  the  Property  Trustee  is not  also  acting  as the
Securities Registrar, the Administrative Trustees or the Depositor shall furnish
or cause to be furnished to the Property Trustee (a)  semi-annually on or before
January  15 and  July 15 in each  year,  a list,  in such  form as the  Property
Trustee  may   reasonably   require,   of  the  names  and   addresses   of  the
Securityholders  as of the most  recent  record  date;  and (b)  promptly  after
receipt by any  Administrative  Trustee or the  Depositor of a request  therefor
from the Property  Trustee in order to enable the Property  Trustee to discharge
its  obligations  under this Trust  Agreement,  in each case to the extent  such
information  is in the possession or control of the  Administrative  Trustees or
the  Depositor  and is not  identical to a previously  supplied  list or has not
otherwise  been  received by the Property  Trustee in its capacity as Securities
Registrar.   The   rights  of   Securityholders   to   communicate   with  other
Securityholders with respect to their rights under this Trust Agreement or under
the Trust Securities,  and the  corresponding  rights of the Trustee shall be as
provided in the Trust  Indenture  Act.  Each Holder,  by receiving and holding a
Trust Securities Certificate,  and each owner shall be deemed to have agreed not
to hold the  Depositor,  the  Property  Trustee or the  Administrative  Trustees
accountable by reason of the  disclosure of its name and address,  regardless of
the source from which such information was derived.

         Section 508.  Maintenance of Office or Agency.

         The  Administrative  Trustees shall maintain in The City of New York or
other location designated by the Administrative  Trustees,  an office or offices
or agency or agencies where Preferred Securities Certificates may be surrendered
for  registration  of transfer or exchange  and where  notices and demands to or
upon the Trustees in respect of the Trust Securities Certificates may be served.
The Administrative  Trustees  initially  designate the Corporate Trust Office of
the Property Trustee, Two International Place, 4th Floor, Boston,  Massachusetts
02110,  as  the  principal  corporate  trust  office  for  such  purposes.   The
Administrative Trustees shall give prompt written notice to the Depositor and to
the  Securityholders of any change in the location of the Securities Register or
any such office or agency.

         Section 509.  Appointment of Paying Agent.

         The Property  Trustee shall act as the Paying  Agent.  The Paying Agent
shall make Distributions to  Securityholders  from the Payment Account and shall
report  the  amounts  of such  Distributions  to the  Property  Trustee  and the
Administrative  Trustees.  Any Paying  Agent shall have the  revocable  power to
withdraw  funds  from  the  Payment  Account  for  the  purpose  of  making  the
Distributions  referred to above.  The  Administrative  Trustees may revoke such
power and remove  the  Paying  Agent if such  Trustees  determine  in their sole
discretion  that the Paying  Agent shall have failed to perform its  obligations
under this Trust  Agreement  in any  material  respect.  The Paying  Agent shall
initially  be the  Property  Trustee,  and any  co-paying  agent  chosen  by the
Property  Trustee,  and  acceptable  to  the  Administrative  Trustees  and  the
Depositor.  Any Person  acting as Paying  Agent shall be  permitted to resign as

<PAGE>

Paying Agent upon 30 days' written notice to the  Administrative  Trustees,  the
Property Trustee and the Depositor. In the event that the Property Trustee shall
no longer be the Paying  Agent or a successor  Paying  Agent shall resign or its
authority  to act be  revoked,  the  Administrative  Trustees  shall  appoint  a
successor that is acceptable to the Property Trustee and the Depositor to act as
Paying  Agent  (which  shall be a bank or  trust  company).  The  Administrative
Trustees shall cause such successor Paying Agent or any additional  Paying Agent
appointed by the Administrative  Trustees to execute and deliver to the Trustees
an instrument in which such  successor  Paying Agent or additional  Paying Agent
shall agree with the Trustees that as Paying Agent,  such successor Paying Agent
or  additional  Paying Agent shall hold all sums, if any, held by it for payment
to the Securityholders in trust for the benefit of the Securityholders  entitled
thereto until such sums shall be paid to such Securityholders.  The Paying Agent
shall return all unclaimed funds to the Property  Trustee and, upon removal of a
Paying Agent, such Paying Agent shall also return all funds in its possession to
the Property Trustee. The provisions of Sections 801, 803 and 806 shall apply to
the  Property  Trustee  also in its  role as  Paying  Agent,  for so long as the
Property Trustee shall act as Paying Agent and, to the extent applicable, to any
other paying agent appointed  hereunder.  Any reference in this Agreement to the
Paying  Agent shall  include any  co-paying  agent  unless the context  requires
otherwise.

         Section 510.  Ownership of Common Securities by Depositor.

         On the Closing Date, the Depositor shall acquire and retain  beneficial
and record ownership of the Common  Securities.  To the fullest extent permitted
by law, any attempted  transfer of the Common  Securities (other than a transfer
in  connection  with a merger or  consolidation  of the  Depositor  into another
corporation  pursuant  to  Section  12.1 of the  Indenture)  shall be void.  The
Administrative Trustees shall cause each Common Securities Certificate issued to
the   Depositor  to  contain  a  legend   stating  "THIS   CERTIFICATE   IS  NOT
TRANSFERABLE".

         Section 511.  Preferred Securities Certificates.

         (a)  Each  owner  shall  receive  a  Preferred  Securities  Certificate
representing  such  owner's  interest  in such  Preferred  Securities.  Upon the
issuance of Definitive  Preferred  Securities  Certificates,  the Trustees shall
recognize the record holders of the Definitive Preferred Securities Certificates
as Securityholders.  The Definitive Preferred  Securities  Certificates shall be
printed,  lithographed  or engraved or may be produced in any other manner as is
reasonably  acceptable  to the  Administrative  Trustees,  as  evidenced  by the
execution thereof by the Administrative Trustees or any one of them.

         (b) A single  Common  Securities  Certificate  representing  the Common
Securities  shall be issued to the Depositor in the form of a definitive  Common
Securities Certificate.

         Section 512.  [Intentionally Omitted].

         Section 513.  [Intentionally Omitted].

         Section 514.  Rights of Securityholders.
<PAGE>

         (a) The legal title to the Trust Property is vested  exclusively in the
Property  Trustee (in its capacity as such) in accordance  with Section 209, and
the  Securityholders  shall not have any right or title  therein  other than the
undivided  beneficial  interest  in the assets of the Trust  conferred  by their
Trust  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  Trust  Securities  shall  be  personal  property  giving  only  the  rights
specifically set forth therein and in this Trust Agreement. The Trust Securities
shall have no preemptive or similar rights. When issued and delivered to Holders
of the Preferred Securities against payment of the purchase price therefor,  the
Preferred  Securities  shall be fully paid and  nonassessable  interests  in the
Trust.  The Holders of the Preferred  Securities,  in their  capacities as such,
shall be  entitled to the same  limitation  of  personal  liability  extended to
stockholders  of private  corporations  for profit  organized  under the General
Corporation Law of the State of Delaware.

         (b) For so long as any Preferred  Securities  remain  Outstanding,  if,
upon a Debenture Event of Default, the Debenture Trustee fails or the holders of
not less than 25% in  principal  amount of the  outstanding  Debentures  fail to
declare  the  principal  of all of the  Debentures  to be  immediately  due  and
payable,  the  Holders of at least 25% in  Liquidation  Amount of the  Preferred
Securities then Outstanding  shall have such right by a notice in writing to the
Depositor  and the  Debenture  Trustee;  and  upon  any  such  declaration  such
principal  amount of and the  accrued  interest on all of the  Debentures  shall
become  immediately due and payable,  provided that the payment of principal and
interest on such Debentures shall remain  subordinated to the extent provided in
the Indenture.

         (c) For so long as any Preferred  Securities  remain  outstanding,  if,
upon a Debenture  Event of Default  arising  from the failure to pay interest or
principal  on the  Debentures,  the  Holders of any  Preferred  Securities  then
Outstanding  shall,  to the fullest  extent  permitted by law, have the right to
directly  institute  proceedings  for  enforcement of payment to such Holders of
principal of or interest on the  Debentures  having a principal  amount equal to
the Liquidation Amount of the Preferred Securities of such Holders.


                                   ARTICLE VI
                    ACTS OF SECURITYHOLDERS; MEETINGS; VOTING

         Section 601.  Limitations on Voting Rights.

         (a) Except as provided in this  Section  601, in Sections  514, 810 and
1002 and in the  Indenture  and as  otherwise  required  by law,  no  Holder  of
Preferred  Securities  shall have any right to vote or in any  manner  otherwise
control  the  administration,  operation  and  management  of the  Trust  or the
obligations  of the parties  hereto,  nor shall  anything  herein set forth,  or
contained in the terms of the Trust Securities Certificates,  be construed so as
to constitute the Securityholders from time to time as partners or members of an
association.

         (b) So long as any  Debentures  are held by the Property  Trustee,  the
Trustees  shall not (i) direct  the time,  method  and place of  conducting  any

<PAGE>

proceeding for any remedy available to the Debenture  Trustee,  or executing any
trust  or  power  conferred  on the  Debenture  Trustee  with  respect  to  such
Debentures;  (ii) waive any past default which is waivable  under Article VII of
the Indenture;  (iii) exercise any right to rescind or annul a declaration  that
the principal of all the Debentures shall be due and payable; or (iv) consent to
any amendment,  modification  or termination of the Indenture or the Debentures,
where such consent shall be required, without, in each case, obtaining the prior
approval  of the  Holders of at least a majority  in  Liquidation  Amount of all
Outstanding Preferred Securities;  provided, however, that where a consent under
the Indenture would require the consent of each Holder of Outstanding Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior written consent of each holder of Preferred  Securities.  The Trustees
shall not revoke any action  previously  authorized or approved by a vote of the
Holders of the Outstanding Preferred Securities,  except by a subsequent vote of
the Holders of the Outstanding Preferred Securities.  The Property Trustee shall
notify  each Holder of the  Outstanding  Preferred  Securities  of any notice of
default received from the Debenture  Trustee with respect to the Debentures.  In
addition to obtaining  the  foregoing  approvals of the Holders of the Preferred
Securities, prior to taking any of the foregoing actions, the Trustees shall, at
the expense of the Depositor,  obtain an Opinion of Counsel  experienced in such
matters  to the effect  that the Trust  shall  continue  to be  classified  as a
grantor  trust and not as an  association  taxable as a  corporation  for United
States federal income tax purposes on account of such action.

         (c) If any proposed  amendment to the Trust Agreement  provides for, or
the Trustees  otherwise  propose to effect,  (i) any action that would adversely
affect in any material respect the powers,  preferences or special rights of the
Preferred  Securities,  whether by way of  amendment  to the Trust  Agreement or
otherwise;  or (ii) the  dissolution,  winding-up or  termination  of the Trust,
other than  pursuant to the terms of this Trust  Agreement,  then the Holders of
Outstanding  Preferred  Securities  as a class shall 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  Outstanding  Preferred  Securities.  No  amendment  to this Trust
Agreement may be made if, as a result of such  amendment,  the Trust would cease
to be classified  as a grantor  trust or would be  classified as an  association
taxable as a corporation for United States federal income tax purposes.

         Section 602.  Notice of Meetings.

         Notice of all meetings of the  Preferred  Securityholders,  stating the
time,  place and purpose of the meeting,  shall be given by the Property Trustee
pursuant to Section  1008 to each  Preferred  Securityholder  of record,  at his
registered  address,  at  least 15 days and not  more  than 90 days  before  the
meeting. At any such meeting, any business properly before the meeting may be so
considered  whether or not stated in the notice of the  meeting.  Any  adjourned
meeting may be held as adjourned without further notice.

         Section 603.  Meetings of Preferred Securityholders.

         (a) No annual  meeting of  Securityholders  is required to be held. The
Administrative  Trustees,  however,  shall call a meeting of  Securityholders to
vote on any matter in respect of which Preferred Securityholders are entitled to
vote upon the written  request of the  Preferred  Securityholders  of 25% of the

<PAGE>

Outstanding Preferred Securities (based upon their aggregate Liquidation Amount)
and the  Administrative  Trustees or the  Property  Trustee  may, at any time in
their  discretion,  call a meeting of Preferred  Securityholders  to vote on any
matters as to which the Preferred Securityholders are entitled to vote.

         (b)  Preferred  Securityholders  of  record  of 50% of the  Outstanding
Preferred Securities (based upon their aggregate Liquidation Amount), present in
person or by proxy, shall constitute a quorum at any meeting of Securityholders.

         (c) If a quorum is  present at a meeting,  an  affirmative  vote by the
Preferred Securityholders of record present, in person or by proxy, holding more
than  a  majority  of the  Preferred  Securities  (based  upon  their  aggregate
Liquidation  Amount) held by the Preferred  Securityholders  of record  present,
either in person or by proxy, at such meeting shall constitute the action of the
Securityholders,  unless  this  Trust  Agreement  requires  a greater  number of
affirmative votes.

         Section 604.  Voting Rights.

         Securityholders  shall  be  entitled  to  one  vote  for  each  $25  of
Liquidation  Amount  represented  by their  Trust  Securities  in respect of any
matter as to which such Securityholders are entitled to vote.

         Section 605.  Proxies, etc.

         At any meeting of Securityholders,  any Securityholder entitled to vote
thereat may vote by proxy, provided that no proxy, shall be voted at any meeting
unless it shall have been placed on file with the  Administrative  Trustees,  or
with such other officer or agent of the Trust as the Administrative Trustees may
direct,  for  verification  prior to the time at which such vote shall be taken.
When Trust Securities are held jointly by several  persons,  any one of them may
vote at any  meeting in person or by proxy in respect of such Trust  Securities,
but if more than one of them shall be  present  at such  meeting in person or by
proxy, and such joint owners or their proxies so present disagree as to any vote
to be cast, such vote shall not be received in respect of such Trust Securities.
A proxy purporting to be executed by or on behalf of a  Securityholder  shall be
deemed valid unless  challenged at or prior to its exercise,  and, the burden of
proving  invalidity  shall rest on the challenger.  No proxy shall be valid more
than three years after its date of execution.

         Section 606.  Securityholder Action by Written Consent.

         Any action  which may be taken by  Securityholders  at a meeting may be
taken without a meeting if  Securityholders  holding more than a majority of all
Outstanding  Trust Securities  (based upon their aggregate  Liquidation  Amount)
entitled to vote in respect of such action (or such larger proportion thereof as
shall be  required  by any  express  provision  of this Trust  Agreement)  shall
consent  to the  action in  writing  (based  upon  their  aggregate  Liquidation
Amount).

         Section 607.  Record Date for Voting and Other Purposes.

         For the purposes of determining the Securityholders who are entitled to
notice of and to vote at any meeting or by written consent, or to participate in
any  Distribution  on the Trust  Securities in respect of which a record date is

<PAGE>

not otherwise  provided for in this Trust  Agreement,  or for the purpose of any
other action, the Administrative  Trustees may from time to time fix a date, not
more than 90 days  prior to the date of any  meeting of  Securityholders  or the
payment of  Distribution  or other action,  as the case may be, as a record date
for the determination of the identity of the  Securityholders of record for such
purposes.

         Section 608.  Acts of Securityholders.

         (a) Any request,  demand,  authorization,  direction,  notice, consent,
waiver or other  action  provided or  permitted  by this Trust  Agreement  to be
given, made or taken by Securityholders  may be embodied in and evidenced by one
or  more   instruments   of   substantially   similar   tenor   signed  by  such
Securityholders in person or by an agent duly appointed in writing;  and, except
as otherwise  expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative  Trustee. Such
instrument  or  instruments  (and the  action  embodied  therein  and  evidenced
thereby) are herein  sometimes  referred to as the "Act" of the  Securityholders
signing  such  instrument  or  instruments.  Proof  of  execution  of  any  such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Trust Agreement and (subject to Section 801) conclusive in favor
of the Trustees, if made in the manner provided in this Section 608.

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

          (c) The  ownership  of  Preferred  Securities  shall be  proved by the
Securities Register.

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

         (e) Without limiting the foregoing, a Securityholder entitled hereunder
to take any action hereunder with regard to any particular Trust Security may do
so with  regard  to all or any  part of the  Liquidation  Amount  of such  Trust
Security  or by one or  more  duly  appointed  agents  each of  which  may do so
pursuant to such  appointment with regard to all or any part of such liquidation
amount.

         (f) A Securityholder may institute a legal proceeding  directly against
the  Depositor  under the  Guarantee to enforce its rights  under the  Guarantee

<PAGE>

without first  instituting a legal proceeding  against the Guarantee Trustee (as
defined in the Guarantee), the Trust or any Person.

         Section 609.  Inspection of.

         Upon reasonable notice to the Administrative  Trustees and the Property
Trustee,  the  records of the Trust shall be open to  inspection  and copying by
Securityholders  and their  authorized  representatives  during normal  business
hours for any purpose reasonably related to such Securityholder's  interest as a
Securityholder.


                                   ARTICLE VII
                         REPRESENTATIONS AND WARRANTIES

          Section  701.  Representations  and  Warranties  of the  Bank  and the
Property Trustee.

         The Bank and the Property  Trustee,  each severally on behalf of and as
to itself,  as of the date hereof,  and each Successor  Property  Trustee at the
time of the  Successor  Property  Trustee's  acceptance  of its  appointment  as
Property  Trustee  hereunder  (the  term  "Bank"  being  used to  refer  to such
Successor Property Trustee in its separate corporate capacity) hereby represents
and  warrants  (as  applicable)  for  the  benefit  of  the  Depositor  and  the
Securityholders that:

          (a) the Bank is a trust company duly organized,  validly  existing and
in good standing under the laws of the Commonwealth of Massachusetts;

         (b) the Bank has full  corporate  power,  authority  and legal right to
execute,  deliver and perform its obligations under this Trust Agreement and has
taken all necessary action to authorize the execution,  delivery and performance
by it of this Trust Agreement;

         (c)  this  Trust  Agreement  has been  duly  authorized,  executed  and
delivered by the Property  Trustee and constitutes the valid and legally binding
agreement of the Property Trustee  enforceable against it in accordance with its
terms, subject to bankruptcy,  insolvency, fraudulent transfer,  reorganization,
moratorium  and similar laws of general  applicability  relating to or affecting
creditors, rights and to general equity principles;

         (d) the execution,  delivery and performance by the Property Trustee of
this Trust  Agreement has been duly  authorized  by all  necessary  corporate or
other  action  on the part of the  Property  Trustee  and does not  require  any
approval  of  stockholders  of  the  Bank  and  such  execution,   delivery  and
performance  shall not (i) violate the Bank's  charter or by-laws;  (ii) violate
any  provision  of, or  constitute,  with or without  notice or lapse of time, a
default  under,  or result in the  creation  or  imposition  of, any Lien on any
properties  included in the Trust  Property  pursuant to the  provisions of, any
indenture,  mortgage, credit agreement, license or other agreement or instrument
to which the Property Trustee or the Bank is a party or by which it is bound; or
(iii) violate any law,  governmental  rule or regulation of the United States or
the Commonwealth of Massachusetts,  as the case may be, governing the banking or
trust powers of the Bank or the Property  Trustee (as appropriate in context) or
any order, judgment or decree applicable to the Property Trustee or the Bank;
<PAGE>

         (e) neither the  authorization,  execution  or delivery by the Property
Trustee of this Trust Agreement nor the  consummation of any of the transactions
by the Property Trustee  contemplated  herein or therein requires the consent or
approval of, the giving of notice to, the registration with or the taking of any
other  action with  respect to any  governmental  authority  or agency under any
existing  federal law  governing  the banking or trust powers of the Bank or the
Property Trustee, as the case may be, under the laws of the United States or the
Commonwealth of Massachusetts; and

         (f) there are no  proceedings  pending or, to the best of the  Property
Trustee's  knowledge,  threatened  against or affecting the Bank or the Property
Trustee in any court or before any governmental authority, agency or arbitration
board or tribunal which, individually or in the aggregate,  would materially and
adversely  affect the Trust or would question the right,  power and authority of
the  Property  Trustee to enter into or perform  its  obligations  as one of the
Trustees under this Trust Agreement.

          Section 702.  Representations  and Warranties of the Delaware Bank and
the Delaware Trustee.

         The Delaware Bank and the Delaware Trustee, each severally on behalf of
and as to itself, as of the date hereof,  and each Successor Delaware Trustee at
the time of the  Successor  Delaware  Trustee's  acceptance  of  appointment  as
Delaware Trustee hereunder (the term "Delaware Bank" being used to refer to such
Successor  Delaware  Trustee  in  its  separate  corporate   capacity),   hereby
represents and warrants (as applicable) for the benefit of the Depositor and the
Securityholders that:

          (a)  the  Delaware  Bank  is  a  Delaware  banking   corporation  duly
organized,  validly existing and in good standing under the laws of the State of
Delaware;

         (b) the Delaware  Bank has full  corporate  power,  authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all  necessary  action to authorize  the  execution,  delivery and
performance by it of this Trust Agreement;

         (c)  this  Trust  Agreement  has been  duly  authorized,  executed  and
delivered by the Delaware  Trustee and constitutes the valid and legally binding
agreement of the Delaware Trustee  enforceable against it in accordance with its
terms, subject to bankruptcy,  insolvency, fraudulent transfer,  reorganization,
moratorium  and similar laws of general  applicability  relating to or affecting
creditors, rights and to general equity principles;

         (d) the execution,  delivery and performance by the Delaware Trustee of
this Trust  Agreement has been duly  authorized  by all  necessary  corporate or
other  action  on the part of the  Delaware  Trustee  and does not  require  any
approval of stockholders  of the Delaware Bank and such execution,  delivery and
performance  shall not (i) violate the Delaware Bank's charter or by-laws;  (ii)
violate any  provision  of, or  constitute,  with or without  notice or lapse of
time, a default  under,  or result in the creation or imposition of, any Lien on
any properties included in the Trust Property pursuant to the provisions of, any
indenture,  mortgage, credit agreement, license or other agreement or instrument
to which the Delaware Bank or the Delaware  Trustee is a party or by which it is

<PAGE>

bound; or (iii) violate any law,  governmental  rule or regulation of the United
States or the State of Delaware,  as the case may be,  governing  the banking or
trust powers of the Delaware  Bank or the Delaware  Trustee (as  appropriate  in
context) or any order, judgment or decree applicable to the Delaware Bank or the
Delaware Trustee;

         (e) neither the  authorization,  execution  or delivery by the Delaware
Trustee of this Trust Agreement nor the  consummation of any of the transactions
by the Delaware Trustee  contemplated  herein or therein requires the consent or
approval of, the giving of notice to, the registration with or the taking of any
other  action with  respect to any  governmental  authority  or agency under any
existing  federal law governing the banking or trust powers of the Delaware Bank
or the Delaware Trustee, as the case may be, under the laws of the United States
or the State of Delaware; and

         (f) there are no  proceedings  pending or, to the best of the  Delaware
Trustee's  knowledge,  threatened  against or affecting the Delaware Bank or the
Delaware  Trustee in any court or before any governmental  authority,  agency or
arbitration  board or tribunal which,  individually  or in the aggregate,  would
materially and adversely affect the Trust or would question the right, power and
authority of the Delaware  Trustee to enter into or perform its  obligations  as
one of the Trustees under this Trust Agreement.

         Section 703.  Representations and Warranties of Depositor.

         The  Depositor  hereby  represents  and warrants for the benefit of the
Securityholders that:

         (a) the Trust Securities Certificates issued on the Closing Date or the
Option  Closing  Date,  if  applicable,  on behalf  of the Trust  have been duly
authorized and, shall have been, duly and validly executed, issued and delivered
by the  Administrative  Trustees pursuant to the terms and provisions of, and in
accordance   with  the   requirements   of,   this  Trust   Agreement   and  the
Securityholders  shall be, as of such date,  entitled  to the  benefits  of this
Trust Agreement; and

         (b) there are no taxes, fees or other  governmental  charges payable by
the Trust (or the  Trustees on behalf of the Trust)  under the laws of the State
of  Delaware  or any  political  subdivision  thereof  in  connection  with  the
execution,  delivery and  performance by the Bank,  the Property  Trustee or the
Delaware Trustee, as the case may be, of this Trust Agreement.


                                  ARTICLE VIII
                                    TRUSTEES

         Section 801.  Certain Duties and Responsibilities.

         (a)  The  duties  and  responsibilities  of the  Trustees  shall  be as
provided by this Trust  Agreement and, in the case of the Property  Trustee,  by
the Trust  Indenture Act.  Notwithstanding  the foregoing,  no provision of this
Trust  Agreement shall require the Trustees 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 they
shall have  reasonable  grounds for  believing  that  repayment of such funds or
adequate  indemnity against such risk or liability is not reasonably  assured to
it. No  Administrative  Trustee nor the Delaware Trustee shall be liable for its

<PAGE>

act or omissions  hereunder  except as a result of its own gross  negligence  or
willful  misconduct.  The Property Trustee's liability shall be determined under
the Trust  Indenture Act.  Whether or not therein  expressly so provided,  every
provision  of this Trust  Agreement  relating  to the conduct or  affecting  the
liability of or  affording  protection  to the Trustees  shall be subject to the
provisions  of this Section 801. To the extent  that,  at law or in equity,  the
Delaware Trustee or an Administrative  Trustee has duties  (including  fiduciary
duties) and liabilities relating thereto to the Trust or to the Securityholders,
the Delaware Trustee or such  Administrative  Trustee shall not be liable to the
Trust or to any  Securityholder  for such  Trustee's  good faith reliance on the
provisions of this Trust Agreement.  The provisions of this Trust Agreement,  to
the extent that they restrict the duties and liabilities of the Delaware Trustee
or the  Administrative  Trustees  otherwise  existing  at law or in equity,  are
agreed by the Depositor and the Securityholders to replace such other duties and
liabilities of the Delaware Trustee and the Administrative Trustees, as the case
may be.

         (b) All  payments  made by the  Property  Trustee or a Paying  Agent in
respect of the Trust 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 Property  Trustee or a
Paying Agent to make payments in accordance with the terms hereof.  With respect
to the relationship of each Securityholder and the Trustee, each Securityholder,
by its acceptance of a Trust  Security,  agrees that it shall 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 are not personally
liable to it for any amount  distributable  in respect of any Trust  Security or
for any other  liability in respect of any Trust  Security.  This Section 801(b)
does not limit the liability of the Trustees  expressly  set forth  elsewhere in
this  Trust  Agreement  or, in the case of the  Property  Trustee,  in the Trust
Indenture Act.

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

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

                  (ii).....the Property 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  Trust  Securities  relating  to the  time,  method  and place of
conducting any proceeding for any remedy available to the Property  Trustee,  or
exercising  any trust or power  conferred  upon the Property  Trustee under this
Trust Agreement;

                  (iii)....the  Property Trustee's sole duty with respect to the
custody,  safe  keeping and  physical  preservation  of the  Debentures  and the
Payment  Account shall be to deal with such Property in a similar  manner as the
Property Trustee deals with similar property for its own account, subject to the
protections and limitations on liability  afforded to the Property Trustee under
this Trust Agreement and the Trust Indenture Act;
<PAGE>

                  (iv).....the  Property  Trustee  shall not be  liable  for any
interest on any money  received by it except as it may otherwise  agree with the
Depositor  and money held by the Property  Trustee need not be  segregated  from
other funds held by it except in relation to the Payment  Account  maintained by
the Property  Trustee pursuant to Section 301 and except to the extent otherwise
required by law; and

                  (v)......the  Property  Trustee shall not be  responsible  for
monitoring the compliance by the  Administrative  Trustees or the Depositor with
their  respective  duties  under this Trust  Agreement,  nor shall the  Property
Trustee  be  liable  for  the   negligence,   default  or   misconduct   of  the
Administrative Trustees or the Depositor.

         Section 802.  Certain Notices.

         (a) Within 5 Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit,  in
the manner and to the extent  provided in Section 1008,  notice of such Event of
Default to the Securityholders,  the Administrative  Trustees and the Depositor,
unless such Event of Default  shall have been cured or waived.  For  purposes of
this  Section 802 the term "Event of Default"  means any event that is, or after
notice or lapse of time or both would become, an Event of Default.

         (b) The Administrative  Trustees shall transmit, to the Securityholders
in the  manner  and to the  extent  provided  in  Section  1008,  notice  of the
Depositor's  election to begin or further  extend an Extended  Interest  Payment
Period on the Debentures  (unless such election shall have been revoked)  within
the time specified for transmitting such notice to the holders of the Debentures
pursuant to the Indenture as originally executed.

         Section 803.  Certain Rights of Property Trustee.

         Subject to the provisions of Section 801:

         (a) the  Property  Trustee may rely and shall 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,  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 or presented by the proper party or parties;

         (b) if (i) in  performing  its duties  under this Trust  Agreement  the
Property Trustee is required to decide between alternative courses of action; or
(ii) in construing  any of the  provisions of this Trust  Agreement the Property
Trustee finds the same ambiguous or inconsistent with other provisions contained
herein;  or (iii) the  Property  Trustee  is unsure  of the  application  of any
provision of this Trust Agreement, then, except as to any matter as to which the
Preferred  Securityholders  are  entitled  to vote under the terms of this Trust
Agreement,  the  Property  Trustee  shall  deliver  a  notice  to the  Depositor
requesting  written  instructions of the Depositor as to the course of action to
be taken and the Property Trustee shall take such action, or refrain from taking
such action,  as the Property Trustee shall be instructed in writing to take, or
to  refrain  from  taking,  by the  Depositor;  provided,  however,  that if the
Property  Trustee does not receive such  instructions of the Depositor within 10

<PAGE>

Business Days after it has delivered  such notice,  or such  reasonably  shorter
period of time set forth in such notice (which to the extent  practicable  shall
not be less than 2 Business  Days),  it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Trust Agreement as
it shall deem  advisable and in the best  interests of the  Securityholders,  in
which event the Property  Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;

          (c)  any  direction  or  act of the  Depositor  or the  Administrative
Trustees contemplated by this Trust Agreement shall be sufficiently evidenced by
an Officers' Certificate;

         (d)  whenever  in the  administration  of  this  Trust  Agreement,  the
Property  Trustee shall deem it desirable  that a matter be  established  before
undertaking,  suffering or omitting any action  hereunder,  the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad  faith  on its  part,  request  and  conclusively  rely  upon  an  Officer's
Certificate which, upon receipt of such request,  shall be promptly delivered by
the Depositor or the Administrative Trustees;

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

         (f) the Property  Trustee may consult with counsel of its choice (which
counsel may be counsel to the Depositor 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, such counsel may be
counsel to the  Depositor or any of its  Affiliates,  and may include any of its
employees;  the  Property  Trustee  shall  have  the  right  at any time to seek
instructions  concerning  the  administration  of this Trust  Agreement from any
court of competent jurisdiction;

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

         (h) the Property  Trustee shall not be bound to make any  investigation
into the facts or  matters  stated in any  resolution,  certificate,  statement,
instrument,  opinion,  report, notice, request,  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  Securityholders,  but the
Property Trustee may make such further inquiry or investigation  into such facts
or matters as it may see fit;

         (i) the  Property  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, provided that the Property Trustee shall be responsible for
its own  negligence  or  recklessness  with respect to selection of any agent or
attorney appointed by it hereunder;
<PAGE>

         (j) whenever in the administration of this Trust Agreement the Property
Trustee  shall  deem it  desirable  to  receive  instructions  with  respect  to
enforcing any remedy or right or taking any other action  hereunder the Property
Trustee (i) may request  instructions  from the Holders of the Trust  Securities
which  instructions  may only be given by the Holders of the same  proportion in
Liquidation  Amount of the Trust  Securities  as would be entitled to direct the
Property  Trustee  under the terms of the Trust  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 protected in acting in accordance with such instructions; and

         (k) except as otherwise expressly provided by this Trust Agreement, the
Property  Trustee  shall not be under any  obligation to take any action that is
discretionary under the provisions of this Trust Agreement. No provision of this
Trust Agreement shall be deemed to impose any duty or obligation on the Property
Trustee  to  perform  any act or acts or  exercise  any  right,  power,  duty or
obligation  conferred or imposed on it, in any jurisdiction in which it shall be
illegal, or in which the Property Trustee shall be unqualified or incompetent in
accordance  with applicable law, to perform any such act or acts, or to exercise
any such right,  power,  duty or  obligation.  No permissive  power or authority
available to the Property Trustee shall be construed to be a duty.

         Section 804.  Not Responsible for Recitals or Issuance of Securities.

         The Recitals contained herein and in the Trust Securities  Certificates
shall be taken as the  statements  of the Trust,  and the Trustees do not assume
any responsibility for their correctness.  The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.

         Section 805.  May Hold Securities.

         Any  Trustee or any other  agent of any  Trustee  or the Trust,  in its
individual  or any other  capacity,  may  become  the owner or  pledgee of Trust
Securities  and,  subject to Sections  808 and 813 and except as provided in the
definition of the term  "Outstanding"  in Article I, may otherwise deal with the
Trust with the same  rights it would have if it were not a Trustee or such other
agent.

         Section 806.  Compensation; Indemnity; Fees.

         The Depositor agrees:

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

         (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 Trust

<PAGE>

Agreement   (including  the  reasonable   compensation   and  the  expenses  and
disbursements of its agents and counsel), except any such expense,  disbursement
or advance as may be  attributable  to such Trustee's  negligence,  bad faith or
willful  misconduct  (or,  in the  case of the  Administrative  Trustees  or the
Delaware  Trustee,  any  such  expense,   disbursement  or  advance  as  may  be
attributable  to  its,  his  or her  gross  negligence,  bad  faith  or  willful
misconduct); and

         (c) to indemnify each of the Trustees or any  predecessor  Trustee for,
and to hold the Trustees harmless against, any loss, damage, claims,  liability,
penalty or expense incurred without negligence or bad faith on its part, arising
out of or in  connection  with the  acceptance or  administration  of this Trust
Agreement,  including  the costs and  expenses of defending  itself  against any
claim or liability in connection  with the exercise or performance of any of its
powers or duties hereunder, except any such expense,  disbursement or advance as
may  be  attributable  to  such  Trustee's  negligence,  bad  faith  or  willful
misconduct  (or,  in the case of the  Administrative  Trustees  or the  Delaware
Trustee,  any such expense,  disbursement  or advance as may be  attributable to
its, his or her gross negligence, bad faith or willful misconduct).

         No Trustee  may claim any Lien or charge on Trust  Property as a result
of any amount due pursuant to this Section 806.

          Section 807.  Corporate  Property  Trustee  Required;  Eligibility  of
Trustees.

         (a)  There  shall at all times be a  Property  Trustee  hereunder  with
respect to the Trust Securities.  The Property Trustee shall be a Person that is
eligible  pursuant to the Trust  Indenture Act to act as such and has a combined
capital  and  surplus  of at least  $50,000,000.  If any such  Person  publishes
reports of condition at least annually,  pursuant to law or to the  requirements
of its supervising or examining authority, then for the purposes of this Section
807, the  combined  capital and surplus of such Person shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so  published.  If at any time the  Property  Trustee  with respect to the Trust
Securities  shall cease to be eligible in accordance with the provisions of this
Section  807,  it shall  resign  immediately  in the  manner and with the effect
hereinafter specified in this Article VIII.

         (b)  There  shall at all times be one or more  Administrative  Trustees
hereunder  with respect to the Trust  Securities.  Each  Administrative  Trustee
shall be  either  a  natural  person  who is at least 21 years of age or a legal
entity  that  shall act  through  one or more  persons  authorized  to bind that
entity.

         (c) There shall at all times be a Delaware  Trustee with respect to the
Trust Securities.  The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of  Delaware;  or (ii) a
legal entity with its  principal  place of business in the State of Delaware and
that otherwise meets the requirements of applicable  Delaware law that shall act
through one or more persons authorized to bind such entity.
<PAGE>

         Section 808.  Conflicting Interests.

         If the Property  Trustee has or shall  acquire a  conflicting  interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign,  to the extent and in the manner provided by,
and  subject  to the  provisions  of,  the Trust  Indenture  Act and this  Trust
Agreement.

         Section 809.  Co-Trustees and Separate Trustee.

         (a) Unless an Event of Default shall have  occurred and be  continuing,
at any time or times,  for the purpose of meeting the legal  requirements of the
Trust  Indenture  Act or of any  jurisdiction  in which  any  part of the  Trust
Property may at the time be located,  the Depositor shall have power to appoint,
and upon the written  request of the Property  Trustee,  the Depositor shall for
such  purpose  join with the  Property  Trustee in the  execution,  delivery and
performance of all  instruments  and agreements  necessary or proper to appoint,
one  or  more  Persons  approved  by  the  Property  Trustee  either  to  act as
co-trustee,  jointly with the Property Trustee, of all or any part of such Trust
Property,  or to the extent  required by law to act as  separate  trustee of any
such  property,  in  either  case with such  powers  as may be  provided  in the
instrument of appointment, and to vest in such Person or Persons in the capacity
aforesaid,  any property,  title,  right or power deemed necessary or desirable,
subject to the other  provisions of this Section 809. If the Depositor  does not
join in such appointment  within 15 days after the receipt by it of a request so
to do, or in case a Debenture  Event of Default has occurred and is  continuing,
the  Property  Trustee  alone  shall  have power to make such  appointment.  Any
co-trustee  or separate  trustee  appointed  pursuant to this  Section 809 shall
either be (i) a natural person who is at least 21 years of age and a resident of
the United States;  or (ii) a legal entity with its principal  place of business
in the United  States that shall act through one or more persons  authorized  to
bind such entity.

         (b) Should any written instrument from the Depositor be required by any
co-trustee or separate  trustee so appointed  for more fully  confirming to such
co-trustee or separate  trustee such property,  title,  right, or power, any and
all such instruments shall, on request, be executed, acknowledged, and delivered
by the Depositor.

         (c) Every co-trustee or separate trustee shall, to the extent permitted
by law, but to such extent only, be appointed  subject to the  following  terms,
namely:

                  (i)......The  Trust Securities shall be executed and delivered
and all  rights,  powers,  duties and  obligations  hereunder  in respect of the
custody of securities,  cash and other personal property held by, or required to
be  deposited  or pledged  with,  the  Trustees  specified  hereunder,  shall be
exercised,  solely  by such  Trustees  and not by such  co-trustee  or  separate
trustee.

                  (ii).....The  rights,  powers,  duties and obligations  hereby
conferred  or imposed  upon the  Property  Trustee  in  respect of any  property
covered by such appointment  shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-trustee
or separate trustee jointly,  as shall be provided in the instrument  appointing
such co-trustee or separate trustee,  except to the extent that under any law of
any  jurisdiction  in which any particular act is to be performed,  the Property
Trustee shall be  incompetent or unqualified to perform such act, in which event

<PAGE>

such rights,  powers, duties and obligations shall be exercised and performed by
such co-trustee or separate trustee.

                  (iii)....The Property Trustee at any time, by an instrument in
writing  executed by it,  with the written  concurrence  of the  Depositor,  may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section 809,  and, in case a Debenture  Event of Default has occurred
and is  continuing,  the  Property  Trustee  shall  have the power to accept the
resignation of, or remove,  any such co-trustee or separate  trustee without the
concurrence of the Depositor.  Upon the written request of the Property Trustee,
the Depositor  shall join with the Property  Trustee in the execution,  delivery
and  performance  of all  instruments  and  agreements  necessary  or  proper to
effectuate  such  resignation  or removal.  A  successor  to any  co-trustee  or
separate  trustee so resigned or removed may be appointed in the manner provided
in this Section 809.

                  (iv).....No  co-trustee or separate  trustee  hereunder  shal
be personally  liable by reason of any act or omission of the Property Trustee 
or any other trustee hereunder.

                  (v)......The  Property  Trustee shall not be liable by reason
of any act of a  co-trustee  or separate trustee.

                  (vi).....Any Act of  Holders delivered to the Property Trustee
shall be  deemed to have been delivered to each  such  co-trustee  and  separate
trustee.

         Section 810.  Resignation and Removal; Appointment of Successor.

         (a) No resignation  or removal of any Trustee (the "Relevant  Trustee")
and no  appointment of a successor  Trustee  pursuant to this Article VIII shall
become effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 811.

         (b)  Subject  to the  immediately  preceding  paragraph,  the  Relevant
Trustee may resign at any time with  respect to the Trust  Securities  by giving
written notice thereof to the  Securityholders.  If the instrument of acceptance
by the successor  Trustee  required by Section 811 shall not have been delivered
to the  Relevant  Trustee  within  30 days  after the  giving of such  notice of
resignation, the Relevant Trustee may petition, at the expense of the Depositor,
any court of competent  jurisdiction for the appointment of a successor Relevant
Trustee with respect to the Trust Securities.

         (c) Unless a  Debenture  Event of Default  shall have  occurred  and be
continuing,  any  Trustee  may be  removed  at  any  time  by Act of the  Common
Securityholder.  If a  Debenture  Event of Default  shall have  occurred  and be
continuing,  the Property Trustee or the Delaware Trustee,  or both of them, may
be removed  at such time by Act of the  Holders  of a  majority  in  Liquidation
Amount of the Preferred  Securities,  delivered to the Relevant  Trustee (in its
individual  capacity and on behalf of the Trust). An Administrative  Trustee may
be removed by the Common Securityholder at any time.

         (d) If any Trustee  shall  resign,  be removed or become  incapable  of
acting as Trustee,  or if a vacancy shall occur in the office of any Trustee for
any cause,  at a time when no Debenture Event of Default shall have occurred and
be continuing,  the Common  Securityholder,  by Act of the Common Securityholder
delivered to the retiring Trustee, shall promptly appoint a successor Trustee or

<PAGE>

Trustees with respect to the Trust  Securities and the Trust,  and the successor
Trustee  shall comply with the  applicable  requirements  of Section 811. If the
Property  Trustee or the Delaware  Trustee  shall  resign,  be removed or become
incapable of continuing to act as the Property Trustee or the Delaware  Trustee,
as the case may be, at a time  when a  Debenture  Event of  Default  shall  have
occurred  and  is  continuing,  the  Preferred  Securityholders,  by  Act of the
Securityholders of a majority in Liquidation Amount of the Preferred  Securities
then  Outstanding  delivered to the retiring  Relevant  Trustee,  shall promptly
appoint a  successor  Relevant  Trustee or  Trustees  with  respect to the Trust
Securities  and the Trust,  and such  successor  Trustee  shall  comply with the
applicable  requirements  of Section  811. If an  Administrative  Trustee  shall
resign, be removed or become incapable of acting as Administrative Trustee, at a
time when a Debenture  Event of Default shall have  occurred and be  continuing,
the Common Securityholder,  by Act of the Common Securityholder  delivered to an
Administrative  Trustee,  shall  promptly  appoint  a  successor  Administrative
Trustee or Administrative  Trustees with respect to the Trust Securities and the
Trust,  and such successor  Administrative  Trustee or  Administrative  Trustees
shall comply with the  applicable  requirements  of Section 811. If no successor
Relevant  Trustee  with  respect  to the  Trust  Securities  shall  have been so
appointed by the Common  Securityholder  or the  Preferred  Securityholders  and
accepted  appointment in the manner required by Section 811, any  Securityholder
who has been a  Securityholder  of Trust Securities on behalf of himself and all
others similarly situated may petition a court of competent jurisdiction for the
appointment Trustee with respect to the Trust Securities.

         (e) The Property Trustee shall give notice of each resignation and each
removal  of a  Trustee  and  each  appointment  of a  successor  Trustee  to all
Securityholders  in the manner provided in Section 1008 and shall give notice to
the  Depositor.  Each notice shall  include the name of the  successor  Relevant
Trustee  and the address of its  Corporate  Trust  office if it is the  Property
Trustee.

         (f)  Notwithstanding the foregoing or any other provision of this Trust
Agreement,  in the event any Administrative Trustee or a Delaware Trustee who is
a natural person dies or becomes,  in the opinion of the Depositor,  incompetent
or incapacitated,  the vacancy created by such death, incompetence or incapacity
may be filled by (a) the unanimous act of remaining  Administrative  Trustees if
there are at least two of them;  or (b)  otherwise  by the  Depositor  (with the
successor in each case being a Person who satisfies the eligibility  requirement
for Administrative Trustees set forth in Section 807).

         Section 811.  Acceptance of Appointment by Successor.

         (a) In  case  of the  appointment  hereunder  of a  successor  Relevant
Trustee  with  respect  to the Trust  Securities  and the  Trust,  the  retiring
Relevant  Trustee and each successor  Relevant Trustee with respect to the Trust
Securities shall execute and deliver an instrument hereto wherein each successor
Relevant  Trustee  shall accept such  appointment  and which 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 Trust Securities and
the Trust and upon the execution and delivery of such instrument 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

<PAGE>

act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Relevant Trustee with respect to the Trust Securities
and the Trust;  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 Trust
Securities and the Trust.

         (b) Upon  request of any such  successor  Relevant  Trustee,  the Trust
shall execute any and all  instruments  for more fully and certainly  vesting in
and confirming to such successor  Relevant  Trustee all such rights,  powers and
trusts referred to in the immediately preceding paragraph, as the case may be.

         (c) No successor  Relevant Trustee shall accept its appointment  unless
at the  time of  such  acceptance  such  successor  Relevant  Trustee  shall  be
qualified and eligible under this Article VIII.

          Section  812.  Merger,  Conversion,  Consolidation  or  Succession  to
Business.

         Any Person into which the Property Trustee, the Delaware Trustee or any
Administrative  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  such  Relevant  Trustee  shall  be  a  party,  or  any
corporation  succeeding to all or substantially all the corporate trust business
of such  Relevant  Trustee,  shall be the  successor  of such  Relevant  Trustee
hereunder,  provided such Person shall be otherwise qualified and eligible under
this Article  VIII,  without the execution or filing of any paper or any further
act on the part of any of the parties hereto.

          Section 813.  Preferential  Collection of Claims Against  Depositor or
Trust.

         If and when the Property  Trustee or the Delaware  Trustee  shall be or
become a creditor of the  Depositor or the Trust (or any other  obligor upon the
Debentures  or the Trust  Securities),  the  Property  Trustee  or the  Delaware
Trustee,  as the case may be,  shall be subject  to and shall  take all  actions
necessary  in order to comply with the  provisions  of the Trust  Indenture  Act
regarding the  collection of claims  against the Depositor or Trust (or any such
other obligor).

         Section 814.  Reports by Property Trustee.

         (a) Not later than July 15 of each year  commencing with July 15, 1997,
the Property  Trustee shall transmit to all  Securityholders  in accordance with
Section 1008, and to the Depositor,  a brief report dated as of such May 15 with
respect to:

                  (i)......its   eligibility  under  Section  807  or,  in  lieu
thereof,  if to the best of its knowledge it has continued to be eligible  under
said Section, a written statement to such effect; and

                  (ii).....any   change  in  the   property  and  funds  in  its
possession as Property  Trustee since the date of its last report and any action
taken by the Property  Trustee in the performance of its duties  hereunder which

<PAGE>

it has not previously  reported and which in its opinion  materially affects the
Trust Securities.

         (b) In addition the Property Trustee shall transmit to  Securityholders
such reports  concerning  the Property  Trustee and its actions under this Trust
Agreement as may be required  pursuant to the Trust  Indenture  Act at the times
and in the manner provided pursuant thereto.

         (c) A copy of each such report shall, at the time of such  transmission
to Holders,  be filed by the Property  Trustee  with The Nasdaq  Stock  Market's
National Market,  and each national  securities  exchange or other  organization
upon which the Trust Securities are listed, and also with the Commission and the
Depositor.

         Section 815.  Reports to the Property Trustee.

         The  Depositor and the  Administrative  Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust  Indenture Act (if any) and the  compliance
certificate  required by Section 314(a) of the Trust  Indenture Act in the form,
in the manner and at the times  required by Section  314 of the Trust  Indenture
Act.

         Section 816.  Evidence of Compliance with Conditions Precedent.

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


         Section 817.  Number of Trustees.

          (a) The number of Trustees shall be five,  provided that the Holder of
all of the Common Securities by written  instrument may increase or decrease the
number of Administrative Trustees. The Property Trustee and the Delaware Trustee
may be the same Person.

         (b) If a Trustee ceases to hold office for any reason and the number of
Administrative  Trustees is not reduced  pursuant to Section  817(a),  or if the
number of Trustees is  increased  pursuant to Section  817(a),  a vacancy  shall
occur.  The vacancy shall be filled with a Trustee  appointed in accordance with
Section 810.

         (c)  The   death,   resignation,   retirement,   removal,   bankruptcy,
incompetence  or incapacity to perform the duties of a Trustee shall not operate
to annul the Trust. Whenever a vacancy in the number of Administrative  Trustees
shall  occur,   until  such  vacancy  is  filled  by  the   appointment   of  an
Administrative  Trustee in  accordance  with  Section  810,  the  Administrative
Trustees in office,  regardless of their number (and  notwithstanding  any other
provision  of  this  Agreement),  shall  have  all  the  powers  granted  to the
Administrative  Trustees  and shall  discharge  all the duties  imposed upon the
Administrative Trustees by this Trust Agreement.
<PAGE>

         Section 818.  Delegation of Power.

         (a) Any  Administrative  Trustee  may, by power of attorney  consistent
with applicable law, delegate to any other natural person over the age of 21 his
or her power for the purpose of executing any documents  contemplated in Section
207(a); and

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

         Section 819.  Voting.

         Except as otherwise  provided in this Trust  Agreement,  the consent or
approval of the Administrative Trustees shall require consent or approval by not
less than a majority of the Administrative Trustees,  unless there are only two,
in which case both must consent.


                                   ARTICLE IX
                       TERMINATION, LIQUIDATION AND MERGER

         Section 901.  Termination Upon Expiration Date.

         Unless earlier  dissolved,  the Trust shall  automatically  dissolve on
March 31, 2051 (the  "Expiration  Date")  subject to  distribution  of the Trust
Property in accordance with Section 904.

         Section 902.  Early Termination.

          The  first  to  occur  of any of the  following  events  is an  "Early
Termination Event:"

         (a) the  occurrence  of a  Bankruptcy  Event  in  respect  of,  or the
dissolution or liquidation of, the Depositor;

         (b)  delivery  of  written  direction  to the  Property  Trustee by the
Depositor  at any time  (which  direction  is wholly  optional  and  within  the
discretion of the Depositor) to dissolve the Trust and distribute the Debentures
to Securityholders  in exchange for the Preferred  Securities in accordance with
Section 904;

          (c) the  redemption of all of the  Preferred  Securities in connection
with the redemption of all of the Debentures; and

          (d) an order for dissolution of the Trust shall have been entered by a
court of competent jurisdiction.
<PAGE>

         Section 903.  Termination.

         The respective obligations and responsibilities of the Trustees and the
Trust created and continued  hereby shall  terminate upon the latest to occur of
the following:  (a) the distribution by the Property Trustee to  Securityholders
upon  the  liquidation  of the  Trust  pursuant  to  Section  904,  or upon  the
redemption  of all of the Trust  Securities  pursuant  to  Section  402,  of all
amounts required to be distributed hereunder upon the final payment of the Trust
Securities; (b) the payment of any expenses owed by the Trust; (c) the discharge
of all  administrative  duties of the  Administrative  Trustees,  including  the
performance  of any tax reporting  obligations  with respect to the Trust or the
Securityholders;  and (d) the filing of a  Certificate  of  Cancellation  by the
Administrative Trustee under the Business Trust Act.

         Section 904.  Liquidation.

         (a) If an Early  Termination Event specified in clause (a), (b), or (d)
of Section 902 occurs or upon the Expiration Date, the Trust shall be liquidated
by the Trustees as  expeditiously  as the  Trustees  determine to be possible by
distributing,  after  satisfaction  of  liabilities to creditors of the Trust as
provided by applicable law, to each  Securityholder a Like Amount of Debentures,
subject to Section 904(d).  Notice of liquidation shall be given by the Property
Trustee by first-class mail, postage prepaid,  mailed not later than 30 nor more
than 60 days prior to the Liquidation Date to each Holder of Trust Securities at
such  Holder's  address  appearing in the  Securities  Register.  All notices of
liquidation shall:

                  (i)......state the Liquidation Date;

                  (ii).....state  that from and after the Liquidation  Date, the
Trust  Securities  shall no longer be  deemed  to be  Outstanding  and any Trust
Securities  Certificates  not  surrendered  for  exchange  shall  be  deemed  to
represent a Like Amount of Debentures; and

                  (iii)....provide   such   information   with  respect  to  the
mechanics  by which  Holders may  exchange  Trust  Securities  Certificates  for
Debentures,  or, if Section 904(d) applies, receive a Liquidation  Distribution,
as the Administrative Trustees or the Property Trustee shall deem appropriate.

         (b) Except where Section 902(c) or 904(d)  applies,  in order to effect
the   liquidation   of  the  Trust  and   distribution   of  the  Debentures  to
Securityholders,  the Property  Trustee  shall  establish a record date for such
distribution  (which  shall be not more  than 45 days  prior to the  Liquidation
Date) and,  either itself acting as exchange agent or through the appointment of
a separate  exchange  agent,  shall  establish such  procedures as it shall deem
appropriate  to effect  the  distribution  of  Debentures  in  exchange  for the
Outstanding Trust Securities Certificates.

         (c)  Except  where  Section  902(c)  or  904(d)   applies,   after  the
Liquidation  Date,  (i) the  Trust  Securities  shall no  longer be deemed to be
outstanding; (ii) certificates representing a Like Amount of Debentures shall be
issued to  holders  of Trust  Securities  Certificates  upon  surrender  of such
certificates to the Administrative  Trustees or their agent for exchange;  (iii)
the Depositor shall use its reasonable  efforts to have the Debentures listed on
The Nasdaq Stock Market's  National Market or on such other securities  exchange
or other  organization  as the Preferred  Securities  are then listed or traded;
(iv) any Trust Securities  Certificates not so surrendered for exchange shall be
deemed to represent a Like Amount of Debentures,  accruing  interest at the rate

<PAGE>

provided  for in the  Debentures  from  the  last  Distribution  Date on which a
Distribution  was  made  on  such  Trust  Securities   Certificates  until  such
certificates are so surrendered (and until such certificates are so surrendered,
no  payments  of  interest  or  principal  shall  be made to  holders  of  Trust
Securities Certificates with respect to such Debentures);  and (v) all rights of
Securityholders  holding Trust Securities shall cease,  except the right of such
Securityholders  to  receive  Debentures  upon  surrender  of  Trust  Securities
Certificates.

         (d) In the event that,  notwithstanding  the other  provisions  of this
Section 904,  whether because of an order for dissolution  entered by a court of
competent  jurisdiction  or  otherwise,  distribution  of the  Debentures in the
manner  provided  herein  is  determined  by  the  Property  Trustee  not  to be
practical,  the Trust  Property  shall be  liquidated,  and the  Trust  shall be
dissolved, wound-up or terminated, by the Property Trustee in such manner as the
Property  Trustee  determines.  In such event,  on the date of the  dissolution,
winding-up or other termination of the Trust,  Securityholders shall be entitled
to  receive  out of the  assets  of the  Trust  available  for  distribution  to
Securityholders,  after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, an amount equal to the Liquidation  Amount per Trust
Security  plus  accumulated  and  unpaid  Distributions  thereon  to the date of
payment (such amount being the  "Liquidation  Distribution").  If, upon any such
dissolution, winding-up or termination, 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,  subject to the next succeeding
sentence, the amounts payable by the Trust on the Trust Securities shall be paid
on a pro rata basis (based upon Liquidation  Amounts).  The holder of the Common
Securities shall be entitled to receive Liquidation  Distributions upon any such
dissolution,  winding-up or termination pro rata  (determined as aforesaid) with
Holders of Preferred  Securities,  except that, if a Debenture  Event of Default
has occurred and is continuing,  the Preferred  Securities shall have a priority
over the Common Securities.

          Section 905. Mergers, Consolidations, Amalgamations or Replacements of
the Trust.

         The Trust may not merge with or into,  consolidate,  amalgamate,  or be
replaced  by,  or  convey,   transfer  or  lease  its   properties   and  assets
substantially as an entirety to any corporation or other Person, except pursuant
to this  Section 905. At the request of the  Depositor,  with the consent of the
Administrative  Trustees and without the consent of the holders of the Preferred
Securities,  the Property Trustee or the Delaware  Trustee,  the Trust may merge
with or into,  consolidate,  amalgamate,  be replaced by or convey,  transfer or
lease  its  properties  and  assets  substantially  as an  entirety  to a  trust
organized as such under the laws of any state; provided, that (i) such successor
entity either (a)  expressly  assumes all of the  obligations  of the Trust with
respect  to the  Preferred  Securities;  or (b)  substitutes  for the  Preferred
Securities other securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor Securities rank
the  same  as  the  Preferred  Securities  rank  in  priority  with  respect  to
distributions and payments upon liquidation,  redemption and otherwise; (ii) the
Depositor  expressly  appoints a trustee  of such  successor  entity  possessing
substantially  the same powers and duties as the Property  Trustee as the holder
of the Debentures;  (iii) the Successor  Securities are listed or traded, or any
Successor Securities shall be listed or traded upon notification of issuance, on

<PAGE>

any national  securities  exchange or other  organization on which the Preferred
Securities   are  then  listed,   if  any;  (iv)  such  merger,   consolidation,
amalgamation,  replacement,  conveyance,  transfer  or lease does not  adversely
affect the rights,  preferences  and  privileges of the holders of the Preferred
Securities  (including any Successor  Securities) in any material  respect;  (v)
prior to such  merger,  consolidation,  amalgamation,  replacement,  conveyance,
transfer  or lease,  the  Depositor  has  received  an Opinion of Counsel to the
effect  that  (a)  such  merger,   consolidation,   amalgamation,   replacement,
conveyance,  transfer or lease does not adversely affect the rights, preferences
and  privileges  of the  holders  of the  Preferred  Securities  (including  any
Successor  Securities) in any material  respect;  and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the  Trust  nor such  successor  entity  shall be  required  to  register  as an
"investment  company" under the  Investment  Company Act; and (vi) the Depositor
owns all of the Common  Securities of such  successor  entity and guarantees the
obligations of such successor entity under the Successor  Securities at least to
the extent provided by the Guarantee.  Notwithstanding the foregoing,  the Trust
shall not,  except with the consent of holders of 100% in Liquidation  Amount of
the Preferred  Securities,  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 other  Person or permit any other  Person to  consolidate,
amalgamate,   merge  with  or  into,  or  replace  it  if  such   consolidation,
amalgamation,  merger or  replacement  would  cause  the Trust or the  successor
entity to be classified as other than a grantor trust for United States  federal
income tax purposes.


                                    ARTICLE X
                            MISCELLANEOUS PROVISIONS

         Section 1001.  Limitation of Rights of Securityholders.

         The death or incapacity of any Person having an interest, beneficial or
otherwise,  in Trust  Securities  shall not  operate  to  terminate  this  Trust
Agreement,  nor entitle the legal representatives or heirs of such Person or any
Securityholder for such Person, to claim an accounting, take any action or bring
any  proceeding in any court for a partition or  winding-up of the  arrangements
contemplated   hereby,   nor  otherwise  affect  the  rights,   obligations  and
liabilities of the parties hereto or any of them.

         Section 1002.  Amendment.

         (a)  This  Trust  Agreement  may be  amended  from  time to time by the
Trustees and the Depositor,  without the consent of any Securityholders,  (i) as
provided in Section 811 with respect to acceptance of appointment by a successor
Trustee; (ii) to cure any ambiguity,  correct or supplement any provision herein
or therein which may be inconsistent with any other provision herein or therein,
or to make any other  provisions  with respect to matters or  questions  arising
under  this  Trust  Agreement,  that  shall not be  inconsistent  with the other
provisions of this Trust Agreement; or (iii) to modify,  eliminate or add to any
provisions  of this Trust  Agreement  to such  extent as shall be  necessary  to
ensure that the Trust shall be classified  for United States  federal income tax
purposes  as a  grantor  trust  at all  times  that  any  Trust  Securities  are
outstanding  or to ensure that the Trust shall not be required to register as an
"investment company" under the Investment Company Act; provided,  however,  that

<PAGE>

in the case of  clause  (ii),  such  action  shall not  adversely  affect in any
material respect the interests of any Securityholder, and any amendments of this
Trust  Agreement  shall  become  effective  when notice  thereof is given to the
Securityholders.

         (b) Except as provided in Section 601(c) or Section 1002(c) hereof, any
provision  of this  Trust  Agreement  may be  amended  by the  Trustees  and the
Depositor (i) with the consent of Trust  Securityholders  representing  not less
than a majority (based upon  Liquidation  Amounts) of the Trust  Securities then
Outstanding;  and (ii) upon  receipt by the Trustees of an Opinion of Counsel to
the effect  that such  amendment  or the  exercise  of any power  granted to the
Trustees in accordance  with such amendment  shall not affect the Trust's status
as a grantor trust for United States  federal income tax purposes or the Trust's
exemption  from status of an "investment  company" under the Investment  Company
Act.

         (c) In  addition to and  notwithstanding  any other  provision  in this
Trust  Agreement,  without the  consent of each  affected  Securityholder  (such
consent being obtained in accordance with Section 603 or 606 hereof), this Trust
Agreement  may  not be  amended  to (i)  change  the  amount  or  timing  of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution  required to be made in respect of the Trust Securities as of a
specified date; or (ii) restrict the right of a Securityholder to institute suit
for the  enforcement of any such payment on or after such date;  notwithstanding
any other provision herein, without the unanimous consent of the Securityholders
(such consent being obtained in accordance with Section 603 or 606 hereof), this
paragraph (c) of this Section 1002 may not be amended.

         (d)  Notwithstanding  any other provisions of this Trust Agreement,  no
Trustee  shall enter into or consent to any  amendment  to this Trust  Agreement
which would cause the Trust to fail or cease to qualify for the  exemption  from
status of an "investment company" under the Investment Company Act or to fail or
cease to be classified as a grantor trust for United States  federal  income tax
purposes.

         (e)  Notwithstanding  anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.

         (f) In the event that any  amendment  to this Trust  Agreement is made,
the  Administrative  Trustees shall promptly  provide to the Depositor a copy of
such amendment.

         (g) Neither the  Property  Trustee nor the  Delaware  Trustee  shall be
required to enter into any amendment to this Trust  Agreement  which affects its
own  rights,  duties or  immunities  under this Trust  Agreement.  The  Property
Trustee  shall be  entitled  to receive an Opinion of Counsel  and an  Officers'
Certificate  stating that any amendment to this Trust Agreement is in compliance
with this Trust Agreement.

         Section 1003.  Separability.

         In  case  any  provision  in  this  Trust  Agreement  or in  the  Trust
Securities  Certificates  shall  be  invalid,  illegal  or  unenforceable,   the

<PAGE>

validity,  legality and enforceability of the remaining  provisions shall not in
any way be affected or impaired thereby.

         Section 1004.  Governing law.

         THIS TRUST  AGREEMENT  AND THE RIGHTS  AND  OBLIGATIONS  OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT
AND THE TRUST  SECURITIES  SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE  LAWS  OF THE  STATE  OF  DELAWARE  (WITHOUT  REGARD  TO  CONFLICT  OF  LAWS
PRINCIPLES).

         Section 1005.  Payments Due on Non-Business Day.

         If the date fixed for any payment on any Trust  Security shall be a day
that is not a Business  Day, then such payment need not be made on such date but
may be made on the next  succeeding  day which is a Business  Day, with the same
force and  effect  as though  made on the date  fixed for such  payment,  and no
distribution shall accumulate thereon for the period after such date.

         Section 1006.  Successors.

         This  Trust  Agreement  shall be  binding  upon and shall  inure to the
benefit of any successor to the Depositor, the Trust or the Relevant Trustee(s),
including  any  successor  by  operation  of law.  Except in  connection  with a
consolidation,  merger or sale involving the Depositor  that is permitted  under
Article  XII of the  Indenture  and  pursuant  to which the  assignee  agrees in
writing to perform the Depositor's  obligations  hereunder,  the Depositor shall
not assign its obligations hereunder.

         Section 1007.  Headings.

         The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.

         Section 1008.  Reports, Notices and Demands.

         Any  report,  notice,  demand  or  other  communication  which  by  any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Securityholder or the Depositor may be given or served in writing
by deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission,  in each case, addressed, (a) in the case of
a  Preferred   Securityholder,   to  such  Preferred   Securityholder   as  such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common Securityholder or the Depositor, to First Banks, Inc.,
11901 Olive Boulevard,  St. Louis,  Missouri 63141,  Attention:  Chief Financial
Officer,  facsimile no.: (314) 567-3490. Any notice to Preferred Securityholders
shall  also be given to such  owners as have,  within  two years  preceding  the
giving of such notice, filed their names and addresses with the Property Trustee
for that  purpose.  Such  notice,  demand  or other  communication  to or upon a
Securityholder  shall be deemed to have been sufficiently given or made, for all
purposes, upon hand delivery, mailing or transmission.

         Any notice,  demand or other  communication  which by any  provision of
this Trust  Agreement  is required or permitted to be given or served to or upon
the Trust, the Property Trustee or the Administrative Trustees shall be given in
writing  addressed (until another address is published by the Trust) as follows:

<PAGE>

(a) with respect to the Property Trustee to State Street Bank and Trust Company,
Two International  Place, 4th Floor,  Boston,  Massachusetts  02110,  Attention:
Corporate  Trust  Department;  (b) with  respect  to the  Delaware  Trustee,  to
Wilmington  Trust  Company,  Rodney  Square  North,  1100 North  Market  Street,
Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration;  and
(c) with respect to the  Administrative  Trustees,  to them at the address above
for notices to the  Depositor,  marked  "Attention:  Administrative  Trustees of
First Preferred Capital Trust." Such notice, demand or other communication to or
upon the Trust or the Property Trustee shall be deemed to have been sufficiently
given or made  only  upon  actual  receipt  of the  writing  by the Trust or the
Property Trustee.

         Section 1009.  Agreement Not to Petition.

         Each of the  Trustees  and the  Depositor  agree for the benefit of the
Securityholders that, until at least one year and 1 day after the Trust has been
terminated  in  accordance  with Article IX, they shall not file, or join in the
filing  of, a  petition  against  the Trust  under any  bankruptcy,  insolvency,
reorganization or other similar law (including,  without limitation,  the United
States Bankruptcy Code of 1978, as amended) (collectively, "Bankruptcy Laws") or
otherwise join in the commencement of any proceeding against the Trust under any
Bankruptcy  Law. In the event the  Depositor  takes  action in violation of this
Section 1009, the Property Trustee agrees,  for the benefit of  Securityholders,
that at the expense of the Depositor  (which  expense shall be paid prior to the
filing), it shall file an answer with the bankruptcy court or otherwise properly
contest the filing of such  petition by the  Depositor  against the Trust or the
commencement  of such action and raise the defense that the Depositor has agreed
in  writing  not to take  such  action  and  should  be  stopped  and  precluded
therefrom.  The provisions of this Section 1009 shall survive the termination of
this Trust Agreement.





                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]



<PAGE>


         Section 1010.  Trust Indenture Act; Conflict with Trust Indenture Act.

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

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

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

         (d) The  application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Securities as equity securities  representing
undivided beneficial interests in the assets of the Trust.

          Section 1011.  Acceptance of Terms of Trust  Agreement,  Guarantee and
Indenture.

         THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST  THEREIN
BY OR ON  BEHALF  OF A  SECURITYHOLDER  OR ANY  BENEFICIAL  OWNER,  WITHOUT  ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL  INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST  AGREEMENT AND
AGREEMENT TO THE  SUBORDINATION  PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE  INDENTURE,   AND  SHALL  CONSTITUTE  THE  AGREEMENT  OF  THE  TRUST,   SUCH
SECURITYHOLDER  AND SUCH  OTHERS  THAT THE TERMS AND  PROVISIONS  OF THIS  TRUST
AGREEMENT  SHALL BE BINDING,  OPERATIVE  AND  EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.

                                            FIRST BANKS, INC.


                                            By: /s/ Allen H. Blake
                                            ----------------------
                                            Name:   Allen H. Blake
                                            Title:  Executive Vice President,
                                                       Chief Financial Officer
                                                       and Secretary

                                            STATE STREET BANK AND TRUST COMPANY,
                                            as Property Trustee


                                            By:  /s/ Paul D. Allen
                                            ----------------------
                                            Name:    Paul D. Allen
                                            Title:   Vice President
<PAGE>

                                            WILMINGTON TRUST COMPANY,
                                            as Delaware Trustee


                                            By: /s/ Emmett R. Harmon
                                            ------------------------
                                            Name:   Emmett R. Harmon
                                            Title:  Vice President


                                             /s/ James F. Dierberg
                                            ----------------------
                                            James F. Dierberg, as
                                            Administrative Trustee



                                             /s/ Allen H. Blake
                                            -------------------
                                            Allen H. Blake, as
                                            Administrative Trustee



                                             /s/ Laurence J. Brost
                                            ----------------------
                                            Laurence J. Brost, as
                                            Administrative Trustee




<PAGE>


                                       A-6

                                    EXHIBIT A

                              CERTIFICATE OF TRUST
                                       OF
                          FIRST PREFERRED CAPITAL TRUST

          THIS  CERTIFICATE  OF TRUST  OF FIRST  PREFERRED  CAPITAL  TRUST  (the
"Trust"),  dated as of December  12, 1996,  is being duly  executed and filed by
WILMINGTON  TRUST COMPANY,  a Delaware banking  corporation,  JAMES F. DIERBERG,
ALLEN H. BLAKE and LAURENCE J. Brost, each an individual, as trustees, to form a
business trust under the Delaware Business Trust Act (12 Del. C. Section 3801 et
seq.).


1.       NAME.  The name of the business trust formed hereby is FIRST PREFERRED
         CAPITAL TRUST.

2.       DELAWARE  TRUSTEE. The name and business address of the trustee of the
         Trust in the State of Delaware is  Wilmington  Trust  Company,  Rodney
         Square  North,  1100  North  Market  Street,   Wilmington,   Delaware
         19890-0001, Attention:  Corporate Trust Administration.

3.       EFFECTIVE DATE.This Certificate of Trust shall be effective on December
         16, 1996.

         IN WITNESS  WHEREOF,  the  undersigned,  being the sole trustees of the
Trust,  has  executed  this  Certificate  of Trust as of the  date  first  above
written.


                                            WILMINGTON TRUST COMPANY,
                                            as trustee


                                            By:
                                            Name:
                                            Title:



                                            JAMES F. DIERBERG
                                            as Trustee



                                            ALLEN H. BLAKE
                                            as Trustee



                                            LAURENCE J. BROST
                                            as Trustee


<PAGE>







                                       B-6

                                    EXHIBIT B


                             [Intentionally Omitted]


<PAGE>




                                       C-6

                                    EXHIBIT C

                      THIS CERTIFICATE IS NOT TRANSFERABLE

Certificate Number 1                      Number of Common Securities: 106,702

                    Certificate Evidencing Common Securities
                                       of
                          First Preferred Capital Trust

                                Common Securities
                  (liquidation amount $25 per Common Security)


         FIRST PREFERRED CAPITAL TRUST, a statutory business trust created under
the laws of the State of Delaware (the  "Trust"),  hereby  certifies  that FIRST
BANKS,  INC. (the "Holder") is the registered owner of One Hundred Six Thousand,
Seven  Hundred  Two  (106,702)  common  securities  of  the  Trust  representing
undivided  beneficial  interests in the assets of the Trust and  designated  the
9.25%  Common  Securities  (liquidation  amount  $25 per Common  Security)  (the
"Common Securities").  In accordance with Section 510 of the Trust Agreement (as
defined below),  the Common  Securities are not  transferable  and any attempted
transfer   hereof  shall  be  void.  The   designations,   rights,   privileges,
restrictions,  preferences,  and  other  terms  and  provisions  of  the  Common
Securities  are set forth in, and this  certificate  and the  Common  Securities
represented  hereby are issued and shall in all respects be subject to the terms
and provisions  of, the Amended and Restated Trust  Agreement of the Trust dated
as of February 4, 1997, as the same may be amended from time to time (the "Trust
Agreement"),  including the designation of the terms of the Common Securities as
set forth therein.  The Trust shall furnish a copy of the Trust Agreement to the
Holder without charge upon written  request to the Trust at its principal  place
of business or registered office.

         Upon  receive  of this  certificate,  the  Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.

         IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has
executed this certificate this 4th day of February, 1997.


                                            FIRST PREFERRED CAPITAL TRUST


                                            By
                                                     Name:
                                                     Title:

<PAGE>





                                                        
                                    EXHIBIT D

                    AGREEMENT AS TO EXPENSES AND LIABILITIES


         AGREEMENT AS TO EXPENSES AND LIABILITIES (this "Agreement") dated as of
February 4, 1997,  between  FIRST BANKS,  INC., a Missouri  corporation  ("First
Banks"),  and FIRST  PREFERRED  CAPITAL  TRUST,  a Delaware  business trust (the
"Trust").

                                    RECITALS

         WHEREAS,  the Trust intends to issue its common securities (the "Common
Securities") to, and receive  Debentures from, First Banks and to issue and sell
First Preferred  Capital Trust 9.25% Cumulative Trust Preferred  Securities (the
"Preferred  Securities")  with such powers,  preferences  and special rights and
restrictions as are set forth in the Amended and Restated Trust Agreement of the
Trust dated as of February 4, 1997, as the same may be amended from time to time
(the "Trust Agreement");

         WHEREAS, First Banks shall directly or indirectly own all of the Common
Securities of the Trust and shall issue the Debentures;

         NOW, THEREFORE,  in consideration of the purchase by each holder of the
Preferred  Securities,  which  purchase  First Banks hereby agrees shall benefit
First  Banks  and  which  purchase  First  Banks  acknowledges  shall be made in
reliance  upon the  execution  and  delivery  of this  Agreement,  First  Banks,
including  in its  capacity  as holder of the Common  Securities,  and the Trust
hereby agree as follows:

                                    ARTICLE I

         Section 1.1.  Guarantee by First Banks.

         Subject to the terms and conditions hereof,  First Banks,  including in
its  capacity  as  holder  of the  Common  Securities,  hereby  irrevocably  and
unconditionally  guarantees to each person or entity to whom the Trust is now or
hereafter becomes indebted or liable (the "Beneficiaries") the full payment when
and as  due,  of any  and  all  Obligations  (as  hereinafter  defined)  to such
Beneficiaries.  As used  herein,  "Obligations"  means any  costs,  expenses  or
liabilities  of the Trust other than  obligations of the Trust to pay to holders
of any Preferred  Securities or other similar interests in the Trust the amounts
due such holders pursuant to the terms of the Preferred Securities or such other
similar interests,  as the case may be. This Agreement is intended to be for the
benefit of, and to be  enforceable  by, all such  Beneficiaries,  whether or not
such Beneficiaries have received notice hereof.

         Section 1.2.  Term of Agreement.

         This  Agreement  shall  terminate and be of no further force and effect
upon  the  later  of (a) the date on which  full  payment  has been  made of all
amounts  payable to all holders of all the  Preferred  Securities  (whether upon
redemption, liquidation, exchange or otherwise); and (b) the date on which there
are no Beneficiaries  remaining;  provided,  however,  that this Agreement shall
continue to be effective or shall be  reinstated,  as the case may be, if at any

<PAGE>

time any holder of Preferred  Securities or any Beneficiary must restore payment
of any sums paid under the Preferred Securities, under any obligation, under the
Preferred  Securities  Guarantee  Agreement dated the date hereof by First Banks
and State Street Bank and Trust  Company,  as guarantee  trustee,  or under this
Agreement for any reason whatsoever. This Agreement is continuing,  irrevocable,
unconditional and absolute.

         Section 1.3.  Waiver of Notice.

         First Banks hereby waives notice of acceptance of this Agreement and of
any  obligation to which it applies or may apply,  and First Banks hereby waives
presentment,  demand  for  payment,  protest,  notice of  nonpayment,  notice of
dishonor, notice of redemption and all other notices and demands.

         Section 1.4.  No Impairment.

         The obligations,  covenants, agreements and duties of First Banks under
this  Agreement  shall  in no way be  affected  or  impaired  by  reason  of the
happening from time to time of any of the following:

         (a) the  extension  of time for the payment by the Trust of all or any
portion of the obligations or for the performance of any other obligation under,
arising out of, or in connection with, the obligations;

         (b) any  failure,  omission,  delay or lack of diligence on the part of
the Beneficiaries to enforce, assert or exercise any right, privilege,  power or
remedy  conferred on the  Beneficiaries  with respect to the  obligations or any
action on the part of the Trust granting indulgence or extension of any kind; or

         (c) the voluntary or involuntary liquidation,  dissolution, sale of any
collateral, receivership,  insolvency, bankruptcy, assignment for the benefit of
creditors,  reorganization,  arrangement composition or readjustment of debt of,
or other similar  proceedings  affecting,  the Trust or any of the assets of the
Trust.

There shall be no obligation of the  Beneficiaries  to give notice to, or obtain
the  consent  of,  First  Banks  with  respect  to the  happening  of any of the
foregoing.

         Section 1.5.  Enforcement.

         A Beneficiary may enforce this Agreement  directly against First Banks,
and First Banks waives any right or remedy to require that any action be brought
against the Trust or any other person or entity before proceeding  against First
Banks.

                                   ARTICLE II

         Section 2.1.  Binding Effect.

         All guarantees and  agreements  contained in this Agreement  shall bind
the successors,  assigns, receivers, trustees and representatives of First Banks
and shall inure to the benefit of the Beneficiaries.
<PAGE>

         Section 2.2.  Amendment.

         So long as there remains any Beneficiary or any Preferred Securities of
any series are  outstanding,  this Agreement shall not be modified or amended in
any  manner  adverse to such  Beneficiary  or to the  holders  of the  Preferred
Securities.

         Section 2.3.  Notices.

         Any notice,  request or other communication required or permitted to be
given  hereunder  shall be given in writing by delivering  the same by facsimile
transmission  (confirmed by mail),  telex,  or by registered or certified  mail,
addressed as follows (and if so given, shall be deemed given when mailed or upon
receipt of an answerback, if sent by telex):

         First Preferred Capital Trust
         c/o  First Banks, Inc.
         11901 Olive Boulevard
         St. Louis, MO 63141
         Facsimile No.: (314) 567-3490
         Attention: Chief Financial Officer

         First Banks, Inc.
         11901 Olive Boulevard
         St. Louis, MO 63141
         Facsimile No.: (314) 567-3490
         Attention: Chief Financial Officer

         Section 2.4.  This  agreement  shall be governed by and  construed  and
interpreted in accordance with the laws of the State of Missouri (without regard
to conflict of laws principles).

         THIS AGREEMENT is executed as of the day and year first above written.

                                            FIRST BANKS, INC.

                                            By:
                                                Name:
                                                Title:


                                            FIRST PREFERRED CAPITAL TRUST

                                            By:
                                                 Name:
                                                 Title:  Administrative Trustee

<PAGE>



                                    EXHIBIT E


Certificate Number                     Number of Preferred Securities ________
         P-

                   Certificate Evidencing Preferred Securities
                                       of
                          First Preferred Capital Trust

                   9.25% Cumulative Trust Preferred Securities
                 (liquidation amount $25 per Preferred Security)

                              CUSIP NO. 33610Y 20 7

FIRST PREFERRED CAPITAL TRUST, a statutory business trust created under the laws
of the State of Delaware (the "Trust"),  hereby certifies that  ________________
(the  "Holder") is the  registered  owner of _____  preferred  securities of the
Trust representing undivided beneficial interests in the assets of the Trust and
designated the 9.25% Cumulative Trust Preferred  Securities  (liquidation amount
$25  per  Preferred  Security)  (the  "Preferred  Securities").   The  Preferred
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  as  provided  in  Section  504 of the  Trust
Agreement  (as  defined   herein).   The   designations,   rights,   privileges,
restrictions,  preferences,  and other  terms and  provisions  of the  Preferred
Securities are set forth in, and this  certificate and the Preferred  Securities
represented  hereby are issued and shall in all respects be subject to the terms
and provisions  of, the Amended and Restated Trust  Agreement of the Trust dated
as of February 4, 1997, as the same may be amended from time to time (the "Trust
Agreement"),  including the designation of the terms of Preferred  Securities as
set forth  therein.  The Holder is  entitled to the  benefits  of the  Preferred
Securities  Guarantee  Agreement  entered into by First Banks,  Inc., a Missouri
corporation,  and State Street Bank and Trust  Company,  as  guarantee  trustee,
dated as of February 4, 1997 (the "Guarantee"),  to the extent provided therein.
The Trust shall  furnish a copy of the Trust  Agreement and the Guarantee to the
Holder without charge upon written  request to the Trust at its principal  place
of business or registered office.

         Upon  receipt  of this  certificate,  the  Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.

         Unless the Certificate of Authentication  has been manually executed by
the Authentication Agent, this certificate is not valid or effective.

         IN  WITNESS  WHEREOF,  the  Administrative  Trustees  of the Trust have
executed this certificate as of the date hereof.



<PAGE>



Dated:                                           FIRST PREFERRED CAPITAL TRUST

CERTIFICATE OF AUTHENTICATION
         This is one of the 9.25%                By_________________________ 
  Cumulative Trust Preferred                              Trustee         
Securities  referred to in  the  
within-mentioned  Amended  and 
Trustee  Restated Trust Agreement.               By_________________________
                                                          Trustee
STATE STREET BANK & TRUST COMPANY,                              
as Authentication Agent and Registrars                        
                                                 By_________________________
                                                           Trustee
                                                                
By  ______________________________                                           
      Authorized Signature


<PAGE>


                        [FORM ON REVERSE OF CERTIFICATE]

    The Trust will furnish  without charge to any registered  owner of Preferred
Securities who so requests, a copy of the Trust Agreement and the Guarantee. Any
such  request  should be in writing and  addressed  to First  Preferred  Capital
Trust, c/o Secretary,  First Banks,  Inc., 135 North Meramec Avenue,  St. Louis,
Missouri 63105 or to the Registrar named on the face of this Certificate.

    The following  abbreviations,  when used in the  inscription  on the face of
this  certificate,  shall be  construed  as though they were written out in full
according to applicable laws or regulations:

  TEN COM-as tenants in common             UNIF GIFT MIN ACT-...Custodian .....
  TEN ENT-as tenants by the entireties                      (Cust)      (Minor)
  JT TEN -as joint tenants with right of           under Uniform Gifts to Minors
          survivorship and not as tenants          Act.........................
          in common                                          (State)
  TOD    -transfer on death direction
          in event of owner's death,      UNIF TRF MIN ACT-Custodian (until age)
          to person named on face and                      (Cust)
          subject to TOD rules, referenced       .......under Uniform Transfers
                                                             (Minor)
                                                  to Minors Act................
                                                             (State)
    Additional abbreviations may also be used though not in the above list.

    FOR VALUE RECEIVED, _________________ hereby sell, assign and transfer unto


PLEASE INSERT SOCIAL SECURITY OR OTHER
    IDENTIFYING NUMBER OF ASSIGNEE
----------------------------------

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



(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)





                                                          Preferred Securities
represented by the within Certificate, and do hereby irrevocably constitute and
appoint

Attorney
to  transfer  the said  Preferred  Securities  on the books of the within  named
Corporation with full power of substitution in the premises.

Dated,



                            NOTICE:     THE SIGNATURE TO  THIS  ASSIGNMENT  MUST
                                        CORRESPOND WITH THE NAME AS WRITTEN UPON
                                        THE FACE OF THE  CERTIFICATE  IN  EVERY
                                        PARTICULAR,   WITHOUT   ALTERNATION   OR
                                        ENLARGEMENT OR ANY CHANGE WHATEVER.


SIGNATURE(S) GUARANTEED:


THE  SIGNATURE(S)  SHOULD BE  GUARANTEED  BY AN ELIGIBLE  GUARANTOR  INSTITUTION
(BANKS,  STOCKBROKERS,  SAVINGS  AND LOAN  ASSOCIATIONS  AND CREDIT  UNIONS WITH
MEMBERSHIP IN AN APPROVED MEDALLION SIGNATURE  GUARANTEE  PROGRAM),  PURSUANT TO
S.E.C. RULE 17Ad-15.



<PAGE>









                                   Exhibit 11




<PAGE>


                                                                Exhibit 11

                                FIRST BANKS, INC.
                        Calculation of Earnings per Share





                                               For the Three Months Ended
                                                        March 31,
                                                        ---------
                                                1997                1996
                                                ----                ----
Average shares outstanding:
   Class C preferred stock                     1,986,233           2,200,000
   Class A preferred stock                       641,082             641,082
   Class B preferred stock                       160,505             160,505
   Common Stock                                   23,661              23,661
                                               =========           =========

Net income                                  $  7,835,817           4,437,304
Preferred stock dividends:
  Class C preferred stock                     (1,082,813)         (1,237,500)
  Class A preferred stock                       (192,325)           (192,325)
  Class B preferred stock                         (4,213)             (4,213)
                                               ---------           --------- 
  Income available to common
   stockholders                             $  6,556,466           3,003,266
                                               =========           =========

Primary earnings per share                  $     277.10              126.93
                                               =========           =========

Fully diluted earnings per share:
Dividends per share:
  Class C preferred stock                   $     0.5452              0.5625
  Class A preferred stock                         0.3000              0.3000
  Class B preferred stock                         0.0262              0.0262
                                               =========           =========

Class A preferred stock outstanding              641,082             641,082
Book value/share of common stock,
  beginning of year                         $   7,795.11            7,175.73
Dilution of common equity upon
  exercise of options and
  warrants of subsidiary bank                     (16.50)             (40.99)
                                               ---------           --------- 
                                            $   7,778.61            7,134.74
                                               =========           =========

Common stock issuable upon conversion              1,648               1,797
Shares of common stock outstanding                23,661              23,661
                                               ---------           ---------
                                                  25,309              25,458
                                               =========           =========

Net income                                  $  7,835,817           4,437,304
Class C preferred dividends                   (1,082,813)         (1,237,500)
Class B preferred dividends                       (4,213)             (4,213)
                                               ---------          ---------- 
  Fully-diluted net income                  $  6,748,791            3,195,591
                                               =========           ==========


Fully-diluted earnings per share                 $266.65               125.52
                                                  ======               ======