<PAGE>   1
                                                                    EXHIBIT 4-M


                       ==================================




                        AMENDED AND RESTATED DECLARATION

                                    OF TRUST

                             PHILLIPS 66 CAPITAL V

                        Dated as of __________ __, 1998





                       ==================================
<PAGE>   2
                               TABLE OF CONTENTS


<TABLE>
<S>                                                                                                                    <C>
ARTICLE I INTERPRETATION AND DEFINITIONS  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

   Section 1.1      Definitions.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE II TRUST INDENTURE ACT  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

   Section 2.1      Trust Indenture Act; Application.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
   Section 2.2      Lists of Holders of Securities.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
   Section 2.3      Reports by the Institutional Trustee.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
   Section 2.4      Periodic Reports to Institutional Trustee.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
   Section 2.5      Evidence of Compliance with Conditions Precedent.   . . . . . . . . . . . . . . . . . . . . . . . . 8
   Section 2.6      Events of Default; Waiver.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
   Section 2.7      Event of Default; Notice.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  10

ARTICLE III ORGANIZATION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  10

   Section 3.1      Name.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  10
   Section 3.2      Office.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
   Section 3.3      Purpose.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
   Section 3.4      Authority.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
   Section 3.5      Title to Property of the Trust.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
   Section 3.6      Powers and Duties of the Regular Trustees.  . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
   Section 3.7      Prohibition of Actions by the Trust and the Trustees.   . . . . . . . . . . . . . . . . . . . . .  14
   Section 3.8      Powers and Duties of the Institutional Trustee.   . . . . . . . . . . . . . . . . . . . . . . . .  15
   Section 3.9      Certain Duties and Responsibilities of the Institutional Trustee.   . . . . . . . . . . . . . . .  17
   Section 3.10     Certain Rights of Institutional Trustee.  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  19
   Section 3.11     Delaware Trustee.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22
   Section 3.12     Execution of Documents.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22
   Section 3.13     Not Responsible for Recitals or Issuance of Securities.   . . . . . . . . . . . . . . . . . . . .  22
   Section 3.14     Duration of Trust.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22
   Section 3.15     Mergers.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22

ARTICLE IV SPONSOR  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24

   Section 4.1      Sponsor's Purchase of Common Securities.  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
   Section 4.2      Responsibilities of the Sponsor.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24

ARTICLE V TRUSTEES  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  25

   Section 5.1      Number of Trustees.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  25
   Section 5.2      Delaware Trustee.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  25
   Section 5.3      Institutional Trustee; Eligibility.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  26
   Section 5.4      Certain Qualifications of Regular Trustees and Delaware Trustee Generally.  . . . . . . . . . . .  27
   Section 5.5      Regular Trustees.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  27
   Section 5.6      Delaware Trustee.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  27
   Section 5.7      Appointment, Removal and Resignation of Trustees.   . . . . . . . . . . . . . . . . . . . . . . .  27
   Section 5.8      Vacancies among Trustees.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  29
   Section 5.9      Effect of Vacancies.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  29
   Section 5.10     Meetings.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  29
   Section 5.11     Delegation of Power.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  30
   Section 5.12     Merger, Conversion, Consolidation or Succession to Business.  . . . . . . . . . . . . . . . . . .  30
</TABLE>
<PAGE>   3
<TABLE>
<S>                                                                                                                    <C>
ARTICLE VI DISTRIBUTIONS  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  31

   Section 6.1      Distributions.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  31

ARTICLE VII ISSUANCE OF SECURITIES  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  31

   Section 7.1      General Provisions Regarding Securities.  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  31
   Section 7.2      Paying Agent.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  32

ARTICLE VIII TERMINATION OF TRUST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  32

   Section 8.1      Termination of Trust.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  32

ARTICLE IX TRANSFER OF INTERESTS  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  33

   Section 9.1      Transfer of Securities.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  33
   Section 9.2      Transfer of Certificates.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  33
   Section 9.3      Deemed Security Holders.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  34
   Section 9.4      Book Entry Interests.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  34
   Section 9.5      Notices to Clearing Agency.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  35
   Section 9.6      Appointment of Successor Clearing Agency.   . . . . . . . . . . . . . . . . . . . . . . . . . . .  35
   Section 9.7      Definitive Preferred Security Certificates.   . . . . . . . . . . . . . . . . . . . . . . . . . .  35
   Section 9.8      Mutilated, Destroyed, Lost or Stolen Certificates.  . . . . . . . . . . . . . . . . . . . . . . .  35

ARTICLE X LIMITATION OF LIABILITY OF HOLDERS  OF SECURITIES, TRUSTEES OR OTHERS . . . . . . . . . . . . . . . . . . .  36

   Section 10.1     Liability.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  36
   Section 10.2     Exculpation.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  36
   Section 10.3     Fiduciary Duty.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  37
   Section 10.4     Indemnification.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  38
   Section 10.5     Outside Businesses.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  41

ARTICLE XI ACCOUNTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  42

   Section 11.1     Fiscal Year.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  42
   Section 11.2     Certain Accounting Matters.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  42
   Section 11.3     Banking.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  42
   Section 11.4     Withholding.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43

ARTICLE XII AMENDMENTS AND MEETINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43

   Section 12.1     Amendments.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43
   Section 12.2     Meetings of the Holders of Securities; Action by Written Consent.   . . . . . . . . . . . . . . .  45

ARTICLE XIII REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE  . . . . . . . . . . . . . . . . . . . . .  47

   Section 13.1     Representations and Warranties of Institutional Trustee.  . . . . . . . . . . . . . . . . . . . .  47
   Section 13.2     Representations and Warranties of Delaware Trustee.   . . . . . . . . . . . . . . . . . . . . . .  47

ARTICLE XIV MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  48

   Section 14.1     Notices.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  48
   Section 14.2     Governing Law.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  49
   Section 14.3     Intention of the Parties.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  49
   Section 14.4     Headings.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  49
   Section 14.5     Successors and Assigns.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  50
   Section 14.6     Partial Enforceability.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  50
   Section 14.7     Counterparts.   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  50
</TABLE>
<PAGE>   4



                              AMENDED AND RESTATED
                              DECLARATION OF TRUST
                                       OF
                             PHILLIPS 66 CAPITAL V

                              _________ ___, 1998

                 AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of __________ __, 1998, by the Trustees (as defined
herein), the Sponsor (as defined herein) and by the holders, from time to time,
of undivided beneficial interests in the Trust to be issued pursuant to this
Declaration;

                 WHEREAS, the Trustees and the Sponsor established Phillips 66
Capital V (the "Trust"), a trust under the Delaware Business Trust Act pursuant
to a Declaration of Trust dated as of February 23, 1998 (the "Original
Declaration"), and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on _________ ____, 1998, for the sole purpose of issuing
and selling certain securities representing undivided beneficial interests in
the assets of the Trust and investing the proceeds thereof in certain
Debentures of the Debenture Issuer;

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

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

                 NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust,
the Trustees declare that all assets contributed to the Trust will be held in
trust for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.

                                   ARTICLE I
                         INTERPRETATION AND DEFINITIONS

                 Section 1.1      Definitions.

                 Unless the context otherwise requires:

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

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

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





                                     - 1 -
<PAGE>   5




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

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

                          (f)     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 or any successor rule thereunder.

                 "Agent" means any Paying Agent.

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

                 "Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 9.4.

                 "Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to close.

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

                 "Certificate" means a Common Security Certificate or a
Preferred Security Certificate.

                 "Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Preferred Securities and in whose name or in the name of a
nominee of that organization shall be registered a Global Certificate and which
shall undertake to effect book entry transfers and pledges of the Preferred
Securities.

                 "Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.

                 "Closing Date" means the "Closing Time" and each "Date of
Delivery" under the Underwriting Agreement.

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





                                     - 2 -
<PAGE>   6




                 "Commission" means the Securities and Exchange Commission.

                 "Common Securities" has the meaning specified in Section
7.1.(a).

                 "Common Securities Guarantee" means the guarantee agreement to
be dated as of ___________, 1998 of the Sponsor in respect of the Common
Securities.

                 "Common Security" has the meaning specified in Section 7.1.

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

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

                 "Corporate Trust Office" means the office of the Institutional
Trustee at which the corporate trust business of the Preferred Guarantee
Trustee shall, at any particular time, be principally administered, which
office at the date of execution of this Agreement is located at White Clay
Center, Route 273, Newark, Delaware 19711.

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

                 "Debenture Issuer" means Phillips Petroleum Company, a
Delaware corporation, in its capacity as issuer of the Debentures under the
Indenture.

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

                 "Debentures" means the series of Debentures to be issued by
the Debenture Issuer under the Indenture to be held by the Institutional
Trustee, a specimen certificate for such series of Debentures being Exhibit B.

                 "Delaware Trustee" has the meaning set forth in Section 5.2.

                 "Definitive Preferred Security Certificates" has the meaning
set forth in Section 9.4.

                 "Distribution" means a distribution payable to Holders of
Securities in accordance with Section 6.1.

                 "DTC" means The Depository Trust Company, the initial Clearing
Agency.





                                     - 3 -
<PAGE>   7



                 "Event of Default" in respect of the Securities means an Event
of Default (as defined in the Indenture) has occurred and is continuing in
respect of the Debentures.

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

                 "Fiduciary Indemnified Person" has the meaning set forth in
Section 10.4(b).

                 "Global Certificate" has the meaning set forth in Section 9.4.

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

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

                 "Indenture" means the Indenture dated as of _______, 1998,
among the Debenture Issuer and the Debenture Trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued.

                 "Institutional Trustee" means the Trustee meeting the
eligibility requirements set forth in Section 5.3.

                 "Institutional Trustee Account" has the meaning set forth in
Section 3.8(c).

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

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

                 "Investment Company Event" has the meaning set forth in Annex
I hereto.

                 "Legal Action" has the meaning set forth in Section 3.6(g).

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

                 "Ministerial Action" has the meaning set forth in the terms of
the Securities as set forth in Annex I.





                                     - 4 -
<PAGE>   8




                 "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 Declaration shall include:

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

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

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

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

                 "Paying Agent" has the meaning specified in Section 7.2.

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

                 "Preferred Securities Guarantee" means the guarantee agreement
to be dated as of ______, 1998, of the Sponsor in respect of the Preferred
Securities.

                 "Preferred Security Beneficial Owner" means, with respect to a
Book Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of
a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).

                 "Preferred Security Certificate" means a certificate
representing a Preferred Security substantially in the form of Exhibit A-1.

                 "Pricing Agreement" means the pricing agreement between the
Trust, the Debenture Issuer, and the underwriters designated by the Regular
Trustees with respect to the offer and sale of the Preferred Securities.

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

                 "Regular Trustee" has the meaning set forth in Section 5.1..





                                     - 5 -
<PAGE>   9




                 "Related Party" means, with respect to the Sponsor, any direct
or indirect wholly owned subsidiary of the Sponsor or any other Person that
owns, directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.

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

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

                 "Securities" means the Common Securities and the Preferred
Securities.

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

                 "Special Event" has the meaning set forth in Annex I hereto.

                 "Securities Guarantees" means the Common Securities Guarantee
and the Preferred Securities Guarantee.

                 "Sponsor" means Phillips Petroleum Company, a Delaware
corporation, or any successor entity in a merger, consolidation or
amalgamation, in its capacity as sponsor of the Trust.

                 "Super Majority" has the meaning set forth in Section
2.6(a)(ii).

                 "Tax Event" has the meaning set forth in Annex I hereto.

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

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





                                     - 6 -
<PAGE>   10




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

                 "Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.

                 "Underwriting Agreement" means the Underwriting Agreement for
the offering and sale of Preferred Securities in the form of Exhibit C.

                                   ARTICLE II
                              TRUST INDENTURE ACT

                 Section 2.1      Trust Indenture Act; Application.

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

                          (b)     The Institutional Trustee shall be the only
Trustee which is a Trustee for the purposes of the Trust Indenture Act.

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

                          (d)     (d) The application of the Trust Indenture
Act to this Declaration shall not affect the nature of the Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.

                 Section 2.2      Lists of Holders of Securities.

                          (a)      Each of the Sponsor and the Regular Trustees
on behalf of the Trust shall provide the Institutional Trustee (i) within 14
days after each record date for payment of Distributions, a list, in such form
as the Institutional Trustee may reasonably require, of the names and addresses
of the Holders of the Securities ("List of Holders") as of such record date,
provided that neither the Sponsor nor the Regular Trustees on behalf of the
Trust shall 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
Institutional Trustee by the Sponsor and the Regular Trustees on behalf of the
Trust, and (ii) at any other time, within 30 days of receipt by the Trust of a
written request for a List of Holders as of a date no more than 14 days before
such List of Holders is given to the Institutional Trustee. The Institutional
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it or which it receives in
the capacity as Paying Agent (if acting in such capacity) provided that the





                                     - 7 -
<PAGE>   11



Institutional Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.

                          (b)     The Institutional Trustee shall comply with
its obligations under Sections  311(a), 311(b) and 312(b) of the Trust
Indenture Act.

                 Section 2.3      Reports by the Institutional Trustee.

                 Within 60 days after May 1 of each year, the Institutional
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
Institutional Trustee shall also comply with the requirements of Section
313(d) of the Trust Indenture Act.

                 Section 2.4      Periodic Reports to Institutional Trustee.

                 Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Institutional 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.

                 Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Institutional Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Declaration 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.

                          (a)     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 in respect of the
Preferred Securities and its consequences, provided that, if the underlying
Event of Default under the Indenture:

                      (i)         is not waivable under the Indenture, the
                 Event of Default under the Declaration shall also not be
                 waivable; or

                      (ii)        requires the consent or vote of greater than
                 a majority in principal amount of the holders of the
                 Debentures (a "Super Majority") to be waived under the
                 Indenture, the Event of Default under the Declaration may only
                 be waived by the vote of the Holders of at least the
                 proportion in liquidation amount of the Preferred





                                     - 8 -
<PAGE>   12



                 Securities that the relevant Super Majority represents of the
                 aggregate principal amount of the Debentures outstanding.

The foregoing provisions of this Section 2.6(a) shall be in lieu of Section
316(a)(1)(B) of the Trust Indenture Act and such Section  316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Preferred Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or an Event of Default with respect to the
Preferred Securities or impair any right consequent thereon. Any waiver by the
Holders of the Preferred Securities of an Event of Default with respect to the
Preferred Securities shall also be deemed to constitute a waiver by the Holders
of the Common Securities of any such Event of Default with respect to the
Common Securities for all purposes of this Declaration without any further act,
vote, or consent of the Holders of the Common Securities.

                      (b)         The Holders of a Majority in liquidation
amount of the Common Securities may, by vote, on behalf of the Holders of all
of the Common Securities, waive any past Event of Default with respect to the
Common Securities and its consequences, provided that, if the underlying Event
of Default under the Indenture:

                      (i)         is not waivable under the Indenture, except
                 where the Holders of the Common Securities are deemed to have
                 waived such Event of Default under the Declaration as provided
                 below in this Section 2.6(b), the Event of Default under the
                 Declaration shall also not be waivable; or

                      (ii)        requires the consent or vote of a Super
                 Majority to be waived, except where the Holders of the Common
                 Securities are deemed to have waived such Event of Default
                 under the Declaration as provided below in this Section
                 2.6(b), the Event of Default under the Declaration may only be
                 waived by the vote of the Holders of at least the proportion
                 in liquidation amount of the Common Securities that the
                 relevant Super Majority represents of the aggregate principal
                 amount of the Debentures outstanding;

provided further, each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to the
Common Securities and its consequences until all Events of Default with respect
to the Preferred Securities have been cured, waived or otherwise eliminated,
and until such Events of Default have been so cured, waived or otherwise
eliminated, the Institutional Trustee will be deemed to be acting solely on
behalf of the Holders of the Preferred Securities and only the Holders of the
Preferred Securities will have the right to direct the Institutional Trustee in
accordance with the terms of the Securities. The foregoing provisions of this
Section 2.6(b) shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of
the Trust Indenture Act and such Sections 316(a)(1)(A) and 316(a)(1)(B) of the
Trust Indenture Act





                                     - 9 -
<PAGE>   13



are hereby expressly excluded from this Declaration and the Securities, as
permitted by the Trust Indenture Act. Subject to the foregoing provisions of
this Section 2.6(b), upon such waiver, any such default shall cease to exist
and any Event of Default with respect to the Common Securities arising
therefrom shall be deemed to have been cured for every purpose of this
Declaration, but no such waiver shall extend to any subsequent or other default
or Event of Default with respect to the Common Securities or impair any right
consequent thereon.

                          (c)     A waiver of an Event of Default under the
Indenture by the Institutional Trustee at the direction of the Holders of the
Preferred Securities, constitutes a waiver of the corresponding Event of
Default under this Declaration. The foregoing provisions of this Section 2.6(c)
shall be in lieu of Section  316(a)(1)(B) of the Trust Indenture Act and such
Section  316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded
from this Declaration and the Securities, as permitted by the Trust Indenture
Act.

                 Section 2.7      Event of Default; Notice.

                          (a)     The Institutional 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 Securities, notices of all defaults with
respect to the Securities actually known to a Responsible Officer of the
Institutional Trustee, unless such defaults have been cured before the giving
of notice (the term "defaults" for the purposes of this Section 2.7(a) being
hereby defined to be an Event of Default as defined in the Indenture, not
including any periods of grace provided for therein and irrespective of the
giving of any notice provided therein); provided that, except for a default in
the payment of principal of (or premium, if any) or interest on any of the
Debentures or in the payment of any sinking fund installment established for
the Debentures, the Institutional Trustee shall be protected in withholding
such notice if and so long as a Responsible Officer of the Institutional
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities.

                      (b)         The Institutional Trustee shall not be deemed
to have knowledge of any default except:

                      (i)         a default under Sections ____ and ____ of the
                 Indenture; or

                      (ii)        any default as to which the Institutional
                 Trustee shall have received written notice or of which a
                 Responsible Officer of the Institutional Trustee charged with
                 the administration of the Declaration shall have actual
                 knowledge.





                                     - 10 -
<PAGE>   14




                                  ARTICLE III
                                  ORGANIZATION

                 Section 3.1      Name.

                 The Trust is named "Phillips 66 Capital V," as such name may
be modified from time to time by the Regular Trustees following written notice
to the Holders of Securities. The Trust's activities may be conducted under the
name of the Trust or any other name deemed advisable by the Regular Trustees.

                 Section 3.2      Office.

                 The address of the principal office of the Trust is c/o
Phillips Petroleum Company, Phillips Building, Bartlesville, Oklahoma 74004. On
ten Business Days written notice to the Holders of Securities, the Regular
Trustees may designate another principal office.

                 Section 3.3      Purpose.

                 The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary, or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, pledge any of
its assets, or otherwise undertake (or permit to be undertaken) any activity
that would cause the Trust not to be classified for United States federal
income tax purposes as a grantor trust.

                 Section 3.4      Authority.

                 Subject to the limitations provided in this Declaration and to
the specific duties of the Institutional Trustee, the Regular Trustees shall
have exclusive and complete authority to carry out the purposes of the Trust.
An action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Institutional Trustee on behalf of the Trust in accordance with its powers
shall constitute the act of and serve to bind the Trust. In dealing with the
Trustees acting on behalf of the Trust, no person shall be required to inquire
into the authority of the Trustees to bind the Trust. Persons dealing with the
Trust are entitled to rely conclusively on the power and authority of the
Trustees as set forth in this Declaration.

                 Section 3.5      Title to Property of the Trust.

                 Except as provided in Section 3.8 with respect to the
Debentures and the Institutional Trustee Account or as otherwise provided in
this Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.

                 Section 3.6      Powers and Duties of the Regular Trustees.

                 The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:





                                     - 11 -
<PAGE>   15




                          (a)     to issue and sell the Preferred Securities
and the Common Securities in accordance with this Declaration; provided,
however, that the Trust may issue no more than one series of Preferred
Securities and no more than one series of Common Securities, and, provided
further, that there shall be no interests in the Trust other than the
Securities, and the issuance of Securities shall be limited to a simultaneous
issuance of both Preferred Securities and Common Securities on [each] Closing
Date;

                          (b)     in connection with the issue and sale of the
Preferred Securities, at the direction of the Sponsor, to:

                      (i)         execute and file with the Commission the
                 registration statement on Form S-3 prepared by the

                 Sponsor, including any amendments thereto, pertaining to the
Preferred Securities;

                      (ii)        execute and file any documents prepared by
                 the Sponsor, or take any acts as determined by the Sponsor to
                 be necessary in order to qualify or register all or part of
                 the Preferred Securities in any State in which the Sponsor has
                 determined to qualify or register such Preferred Securities
                 for sale;

                      (iii)       execute and file an application, prepared by
                 the Sponsor, to the New York Stock Exchange, Inc. or any other
                 national stock exchange or the Nasdaq Stock Market's National
                 Market for listing upon notice of issuance of any Preferred
                 Securities;

                      (iv)        execute and file with the Commission a
                 registration statement on Form 8-A, including any amendments
                 thereto, prepared by the Sponsor, relating to the registration
                 of the Preferred Securities under Section 12(b) of the
                 Exchange Act; and

                      (v)         execute and enter into the Underwriting
                 Agreement and Pricing Agreement providing for the sale of the
                 Preferred Securities;

                          (c)     to acquire the Debentures with the proceeds
of the sale of the Preferred Securities and the Common Securities; provided,
however, that the Regular Trustees shall cause legal title to the Debentures to
be held of record in the name of the Institutional Trustee for the benefit of
the Holders of the Preferred Securities and the Holders of Common Securities;

                          (d)     to give the Sponsor and the Institutional
Trustee prompt written notice of the occurrence of a Tax Event; provided that
the Regular Trustees shall consult with the Sponsor and the Institutional
Trustee before taking or refraining from taking any Ministerial Action in
relation to a Tax Event;





                                     - 12 -
<PAGE>   16




                          (e)     to establish a record date with respect to
all actions to be taken hereunder that require a record date be established,
including and with respect to, for the purposes of Section 316(c) of the Trust
Indenture Act, Distributions, voting rights, redemptions and exchanges, and to
issue relevant notices to the Holders of Preferred Securities and Holders of
Common Securities as to such actions and applicable record dates;

                          (f)     to take all actions and perform such duties
as may be required of the Regular Trustees pursuant to the terms of the
Securities;

                          (g)     to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action, or otherwise adjust claims or demands of or
against the Trust ("Legal Action"), unless pursuant to Section 3.8(e), the
Institutional Trustee has the exclusive power to bring such Legal Action;

                          (h)     to employ or otherwise engage employees and
agents (who may be designated as officers with titles) and managers,
contractors, advisors, and consultants and pay reasonable compensation for such
services;

                          (i)     to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;

                          (j)     to give the certificate required by Section
314(a)(4) of the Trust Indenture Act to the Institutional Trustee, which
certificate may be executed by any Regular Trustee;

                          (k)     to incur expenses that are necessary or
inciden- tal to carry out any of the purposes of the Trust;

                          (l)     to act as, or appoint another Person to act
as, registrar and transfer agent for the Securities;

                          (m)     to give prompt written notice to the Holders
of the Securities of any notice received from the Debenture Issuer of its
election to defer payments of interest on the Debentures by extending the
interest payment period under the Indenture;

                          (n)     to execute all documents or instruments,
perform all duties and powers, and do all things for and on behalf of the Trust
in all matters necessary or incidental to the foregoing;

                          (o)     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;





                                     - 13 -
<PAGE>   17




                          (p)     to take any action, not inconsistent with
this Declaration or with applicable law, that the Regular Trustees determine in
their discretion to be necessary or desirable in carrying out the activities of
the Trust as set out in this Section 3.6, including, but not limited to:

                      (i)         causing the Trust not to be deemed to be an
                 Investment Company required to be registered under the
                 Investment Company Act;

                      (ii)        causing the Trust to be classified for United
                 States federal income tax purposes as a grantor trust; and

                      (iii)       cooperating with the Debenture Issuer to
                 ensure that the Debentures will be treated as indebtedness of
                 the Debenture Issuer for United States federal income tax
                 purposes,

provided that such action does not adversely affect the interests of Holders;
and

                          (q)     to take all action necessary to cause all
applicable tax returns and tax information reports that are required to be
filed with respect to the Trust to be duly prepared and filed by the Regular
Trustees, on behalf of the Trust.

                 The Regular Trustees must exercise the powers set forth in
this Section 3.6 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 3.3, and the Regular Trustees shall not take
any action that is inconsistent with the purposes and functions of the Trust
set forth in Section 3.3.

                 Subject to this Section 3.6, the Regular Trustees shall have
none of the powers or the authority of the Institutional Trustee set forth in
Section 3.8.

                 Any expenses incurred by the Regular Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.

                 Section 3.7      Prohibition of Actions by the Trust and the
Trustees.

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

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





                                     - 14 -
<PAGE>   18




                      (ii)        acquire any assets other than as expressly
                 provided herein;
 
                      (iii)       possess Trust property for other than a Trust
                 purpose;

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

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

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

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

                 Section 3.8      Powers and Duties of the Institutional
Trustee.

                          (a)     The legal title to the Debentures shall be
owned by and held of record in the name of the Institutional Trustee in trust
for the benefit of the Holders of the Securities. The right, title and interest
of the Institutional Trustee to the Debentures shall vest automatically in each
Person who may hereafter be appointed as Institutional Trustee in accordance
with Section 5.7. Such vesting and cessation of title shall be effective
whether or not conveyancing documents with regard to the Debentures have been
executed and delivered.

                          (b)     The Institutional Trustee shall not transfer
its right, title and interest in the Debentures to the Regular Trustees or to
the Delaware Trustee (if the Institutional Trustee does not also act as
Delaware Trustee).

                          (c)     The Institutional Trustee shall:

                      (i)         establish and maintain a segregated
                 non-interest bearing trust account (the "Institutional Trustee
                 Account") in the





                                     - 15 -
<PAGE>   19



                 name of and under the exclusive control of the Institutional
                 Trustee on behalf of the Holders of the Securities and, upon
                 the receipt of payments of funds made in respect of the
                 Debentures held by the Institutional Trustee, deposit such
                 funds into the Institutional Trustee Account and make payments
                 to the Holders of the Preferred Securities and Holders of the
                 Common Securities from the Institutional Trustee Account in
                 accordance with Section 6.1. Funds in the Institutional
                 Trustee Account shall be held uninvested until disbursed in
                 accordance with this Declaration. The Institutional Trustee
                 Account shall be an account that is maintained with a banking
                 institution the rating on whose long-term unsecured
                 indebtedness is at least equal to the rating assigned to the
                 Preferred Securities by a "nationally recognized statistical
                 rating organization", as that term is defined for purposes of
                 Rule 436(g)(2) under the Securities Act;

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

                      (iii)       upon written notice of distribution issued by
                 the Regular Trustees in accordance with the terms of the
                 Securities, engage in such ministerial activities as shall be
                 necessary or appropriate to effect the distribution of the
                 Debentures to Holders of Securities upon the occurrence of
                 certain special events (as may be defined in the terms of the
                 Securities) arising from a change in law or a change in legal
                 interpretation or other specified circumstances pursuant to
                 the terms of the Securities.

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

                          (e)     The Institutional Trustee shall take any
Legal Action which arises out of or in connection with an Event of Default of
which a Responsible Officer of the Institutional Trustee has actual knowledge
or the Institutional Trustee's duties and obligations under this Declaration or
the Trust Indenture Act; provided however, that if a Declaration Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay interest or principal on the Debentures
on the date such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of 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
(a "Direct Action") on or after the respective due date specified in the
Debentures. In connection with such Direct





                                     - 16 -
<PAGE>   20



Action, the rights of the Holders of the Common Securities Holder will be
subrogated to the rights of such Holder of Preferred Securities to the extent
of any payment made by the Issuer to such Holder of Preferred Securities in
such Direct Action. Except as provided in the preceding sentences, the Holders
of Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures.

                          (f)     The Institutional Trustee shall not resign as
a Trustee unless either:

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

                      (ii)        a Successor Institutional Trustee has been
                 appointed and has accepted that appointment in accordance with
                 Section 5.7.

                          (g)     The Institutional Trustee shall have the
legal power to exercise all of the rights, powers and privileges of a holder of
Debentures under the Indenture and, if an Event of Default actually known to a
Responsible Officer of the Institutional Trustee occurs and is continuing, the
Institutional Trustee shall, for the benefit of Holders of the Securities,
enforce its rights as holder of the Debentures subject to the rights of the
Holders pursuant to the terms of such Securities.

                          (h)     The Institutional Trustee may authorize one
or more Persons (each, a "Paying Agent") to pay Distributions, redemption
payments or liquidation payments on behalf of the Trust with respect to all
securities and any such Paying Agent shall comply with Section  317(b) of the
Trust Indenture Act. Any Paying Agent may be removed by the Institutional
Trustee at any time and a successor Paying Agent or additional Paying Agents
may be appointed at any time by the Institutional Trustee.

                          (i)      Subject to this Section 3.8, the
Institutional Trustee shall have none of the duties, liabilities, powers or the
authority of the Regular Trustees set forth in Section 3.6.

                 The Institutional Trustee must exercise the powers set forth
in this Section 3.8 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Institutional Trustee
shall not take any action that is inconsistent with the purposes and functions
of the Trust set out in Section 3.3.

                 Section 3.9      Certain Duties and Responsibilities of the
Institutional Trustee.

                          (a)     The Institutional Trustee, before the
occurrence of any Event of Default and after the curing of all Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Declaration and no implied covenants shall
be read into this Declaration against the Institutional Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6) of which a Responsible Officer of the Institutional Trustee has
actual knowledge, the Institutional Trustee





                                     - 17 -
<PAGE>   21



shall exercise such of the rights and powers vested in it by this Declaration,
and use the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the conduct of his or
her own affairs.

                          (b)     No provision of this Declaration shall be
construed to relieve the Institutional 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 an Event of
                 Default and after the curing or waiving of all such Events of
                 De- fault that may have occurred:

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

                 (B)      in the absence of bad faith on the part of the
   Institutional Trustee, the Institutional 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 Institutional
   Trustee and conforming to the requirements of this Declaration; but in the
   case of any such certificates or opinions that by any provision hereof are
   specifically required to be furnished to the Institutional Trustee, the
   Institutional Trustee shall be under a duty to examine the same to determine
   whether or not they conform to the requirements of this Declaration;

                      (ii)        the Institutional Trustee shall not be liable
                 for any error of judgment made in good faith by a Responsi-
                 ble Officer of the Institutional Trustee, unless it shall be
                 proved that the Institutional Trustee was negligent in
                 ascertaining the pertinent facts;

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

                      (iv)        no provision of this Declaration shall
                 require the Institutional 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 it shall have reasonable grounds for
                 believing that the repayment of such funds or





                                     - 18 -
<PAGE>   22



                 liability is not reasonably assured to it under the terms of
                 this Declaration or indemnity reasonably satisfactory to the
                 Institutional Trustee against such risk or liability is not
                 reasonably assured to it;

                      (v)         the Institutional Trustee's sole duty with
                 respect to the custody, safe keeping and physical preservation
                 of the Debentures and the Institutional Trustee Account shall
                 be to deal with such property in a similar manner as the
                 Institutional Trustee deals with similar property for its own
                 account, subject to the protections and limitations on
                 liability afforded to the Institutional Trustee under this
                 Declaration and the Trust Indenture Act;

                      (vi)        the Institutional Trustee shall have no duty
                 or liability for or with respect to the value, genuineness,
                 existence or sufficiency of the Debentures or the payment of
                 any taxes or assessments levied thereon or in connection
                 therewith;

                      (vii)       the Institutional Trustee shall not be liable
                 for any interest on any money received by it except as it may
                 otherwise agree with the Sponsor. Money held by the
                 Institutional Trustee need not be segregated from other funds
                 held by it except in relation to the Institutional Trustee
                 Account maintained by the Institutional Trustee pursuant to
                 Section 3.8(c)(i) and except to the extent otherwise required
                 by law; and

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

                 Section 3.10     Certain Rights of Institutional Trustee.

                      (a)         Subject to the provisions of Section 3.9:

                      (i)         the Institutional 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;





                                     - 19 -
<PAGE>   23




                      (ii)        any direction or act of the Sponsor or the
                 Regular Trustees contemplated by this Declaration shall be
                 sufficiently evidenced by a Direction or an Officers'
                 Certificate;

                      (iii)       whenever in the administration of this
                 Declaration,  the Institutional Trustee shall deem it
                 desirable that a matter be  proved or established before
                 taking, suffering or omitting any action hereunder, the
                 Institutional 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 Sponsor or the Regular Trustees;

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

                      (v)         the Institutional Trustee may consult with
                 counsel or other experts and the advice or opinion of such
                 counsel and experts with respect to legal matters or advice
                 within the scope of such experts' area of expertise 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 Sponsor or any of its
                 Affiliates, and may include any of its employees. The
                 Institutional Trustee shall have the right at any time to seek
                 instructions concerning the administration of this Declaration
                 from any court of competent jurisdiction;

                      (vi)        the Institutional Trustee shall be under no
                 obligation to exercise any of the rights or powers vested init
                 by this Declaration at the request or direction of any Holder,
                 unless such Holder shall have provided to the Institutional
                 Trustee security and indemnity, reasonably satisfactory to the
                 Institutional Trustee, against the costs, expenses (including
                 attorneys' fees and expenses and the expenses of the
                 Institutional 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 Institutional Trustee provided,
                 that, nothing contained in this Section 3.10(a)(vi) shall be
                 taken to relieve the Institutional Trustee, upon the
                 occurrence of an Event of Default, of its obligation to
                 exercise the rights and powers vested in it by this
                 Declaration;





                                     - 20 -
<PAGE>   24




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

                      (viii)      the Institutional Trustee may execute any of
                 the trusts or powers hereunder or perform any duties hereunder
                 either directly or by or through agents, custodians, nominees
                 or attorneys and the Institutional 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 Institutional Trustee
                 or its agents hereunder shall bind the Trust and the Holders
                 of the Securities, and the signature of the Institutional
                 Trustee or its agents alone shall be sufficient and effective
                 to perform any such action and no third party shall be
                 required to inquire as to the authority of the Institutional
                 Trustee to so act or as to its compliance with any of the
                 terms and provisions of this Declaration, both of which shall
                 be conclusively evidenced by the Institutional Trustee's or
                 its agent's taking such action;

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

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

                          (b)     No provision of this Declaration shall be
deemed to impose any duty or obligation on the Institutional Trustee to perform
any act or acts or exercise any right,





                                     - 21 -
<PAGE>   25



power, duty or obligation conferred or imposed on it, in any jurisdiction in
which it shall be illegal, or in which the Institutional Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Institutional Trustee shall be
construed to be a duty.

                 Section 3.11        Delaware Trustee.

                 Notwithstanding any other provision of this Declaration other
than Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Regular Trustees or the Institutional Trustee described
in this Declaration. Except as set forth in Section 5.2, the Delaware Trustee
shall be a Trustee for the sole and limited purpose of fulfilling the
requirements of Section  3807 of the Business Trust Act.

                 Section 3.12        Execution of Documents.

                 Unless otherwise determined by the Regular Trustees, and
except as otherwise required by the Business Trust Act, a majority of or, if
there are only two, any Regular Trustee or, if there is only one, such Regular
Trustee is authorized to execute on behalf of the Trust any documents that the
Regular Trustees have the power and authority to execute pursuant to Section
3.6; provided that, the registration statement referred to in Section
3.6(b)(i), including any amendments thereto, shall be signed by all of the
Regular Trustees.

                 Section 3.13        Not Responsible for Recitals or Issuance of
Securities.

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

                 Section 3.14        Duration of Trust.

                 The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall have existence for fifty-five (55) years from the
Closing Date.

                 Section 3.15        Mergers.

                          (a)     The Trust may not consolidate, amalgamate,
merge with or into, or be replaced by, or convey, transfer or lease its
properties and assets substantially as an entirety to any corporation or other
body, except as described in Section 3.15(b) and (c).

                          (b)     The Trust may, with the consent of the
Regular Trustees or, if there are more than two, a majority of the Regular
Trustees and without the consent of the Holders of





                                     - 22 -
<PAGE>   26



the Securities, the Delaware Trustee or the Institutional Trustee, consolidate,
amalgamate, merge with or into, or be replaced by a trust organized as such
under the laws of any State; provided that:

                      (i)         such successor entity (the "Successor
                 Entity") either:

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

                 (B)       substitutes for the Securities other securities
   having substantially the same terms as the Preferred Securities (the
   "Successor Securities") so long as the Successor Securities rank the same as
   the Preferred Securities rank with respect to Distributions and payments
   upon liquidation, redemption and otherwise;

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

                      (iii)       the Preferred Securities or any Successor
                 Securities are listed, or any Successor Securities will be
                 listed upon notification of issuance, on any national
                 securities exchange or with another organization on which the
                 Preferred Securities are then listed or quoted;

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

                      (v)         such merger, consolidation, amalgamation or
                 replacement does not adversely affect the rights, preferences
                 and privileges of the Holders of the Securities (including any
                 Successor Securities) in any material respect (other than with
                 respect to any dilution of such Holders' interests in the
                 Preferred Securities as a result of such merger,
                 consolidation, amalgamation or replacement);

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

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

                 (A)      such merger, consolidation, amalgamation or
   replacement does not adversely affect the rights, preferences and privileges
   of the Holders of the Securities





                                     - 23 -
<PAGE>   27



   (including any Successor Securities) in any material respect (other than
   with respect to any dilution of the Holders' interest in the new entity);
   and

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

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

                      (viii)      the Sponsor guarantees the obligations of
                 such Successor Entity under the Successor Securities at least
                 to the extent provided by the Preferred Securities Guarantees.

                          (c)     Notwithstanding Section 3.15(b), the Trust
shall not, except with the consent of Holders of 100% in liquidation amount of
the Securities, consolidate, amalgamate, merge with or into, or be replaced by
any other entity or permit any other entity to consolidate, amalgamate, merge
with or into, or replace it if such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States federal income tax purposes.

                                   ARTICLE IV
                                    SPONSOR

                 Section 4.1      Sponsor's Purchase of Common Securities.

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

                 Section 4.2      Responsibilities of the Sponsor.

                 In connection with the issue and sale of the Preferred
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:

                          (a)     to prepare for filing by the Trust with the
Commission a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments thereto;

                          (b)     to determine 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 the Trust, and advise the Trust of actions it must take, and prepare
for execution and filing any documents to be executed and filed by the Trust,
as the





                                     - 24 -
<PAGE>   28



Sponsor deems necessary or advisable in order to comply with the applicable
laws of any such States;

                          (c)     to prepare for filing by the Trust an
application to the New York Stock Exchange or any other national stock exchange
or the Nasdaq National Market for listing upon notice of issuance of any
Preferred Securities;

                          (d)     to prepare for filing by the Trust with the
Commission a registration statement on Form 8-A relating to the registration of
the Preferred Securities under Section 12(b) of the Exchange Act, including any
amendments thereto; and

                          (e)     to negotiate the terms of the Underwriting
Agreement  and Pricing Agreement providing for the sale of the Preferred
Securities.

                                   ARTICLE V
                                    TRUSTEES

                 Section 5.1      Number of Trustees.

                 The number of Trustees initially shall be [four (4)], and:

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

                          (b)     after the issuance of any Securities, the
number of Trustees may be increased or decreased by vote of the Holders of a
majority in liquidation amount of the Common Securities voting as a class at a
meeting of the Holders of the Common Securities; provided, however, that, the
number of Trustees shall in no event be less than two (2); provided further
that (1) one Trustee, in the case of a natural person, shall be a person who is
a resident of the State of Delaware or that, if not a natural person, is an
entity which has its principal place of business in the State of Delaware (the
"Delaware Trustee"); (2) there shall be at least one Trustee who is an employee
or officer of, or is affiliated with the Parent (a "Regular Trustee"); and (3)
one Trustee shall be the Institutional Trustee for so long as this Declaration
is required to qualify as an indenture under the Trust Indenture Act, and such
Trustee may also serve as Delaware Trustee if it meets the applicable
requirements.

                 Section 5.2      Delaware Trustee.

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

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

                          (b)     if not a natural person, an entity which has
its principal place of business in the State of Delaware, and otherwise meets
the requirements of applicable law,





                                     - 25 -
<PAGE>   29




provided that, if the Institutional Trustee has its principal place of business
in the State of Delaware and otherwise meets the requirements of applicable
law, then the Institutional Trustee shall also be the Delaware Trustee and
Section 3.11 shall have no application.

                 Section 5.3      Institutional Trustee; Eligibility.

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

                      (i)         not be an Affiliate of the Sponsor; 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 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 million
                 U.S. dollars ($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
                 5.3(a)(ii), the combined capital and surplus of such
                 corporation shall be deemed to be its combined capital and
                 surplus as set forth in its most recent report of condition so
                 published.

                          (b)     If at any time the Institutional Trustee
shall cease to be eligible to so act under Section 5.3(a), the Institutional
Trustee shall immediately resign in the manner and with the effect set forth in
Section 5.7(c).

                          (c)     If the Institutional Trustee has or shall
acquire any "conflicting interest" within the meaning of Section  310(b) of the
Trust Indenture Act, the Institutional Trustee and the Holder of the Common
Securities (as if it were the obligor referred to in Section  310(b) of the
Trust Indenture Act) shall in all respects comply with the provisions of
Section  310(b) of the Trust Indenture Act.

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

                          (e)     The initial Institutional Trustee shall be:

                              The Bank of New York





                                     - 26 -
<PAGE>   30



                 Section 5.4      Certain Qualifications of Regular Trustees
and Delaware Trustee Generally.

                 Each Regular Trustee and the Delaware Trustee (unless the
Institutional Trustee also acts as Delaware 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 Authorized Officers.

                 Section 5.5      Regular Trustees.

                 The initial Regular Trustees shall be:

                                  T.C. Morris
                                  J.A. Carrig
                                   R.B. Gisi

                          (a)     Except as expressly set forth in this
Declaration and except if a meeting of the Regular Trustees is called with
respect to any matter over which the Regular Trustees have power to act, any
power of the Regular Trustees may be exercised by, or with the consent of, any
one such Regular Trustee.

                          (b)     Unless otherwise determined by the Regular
Trustees, and except as otherwise required by the Business Trust Act or
applicable law, any Regular Trustee is authorized to execute on behalf of the
Trust any documents which the Regular Trustees have the power and authority to
cause the Trust to execute pursuant to Section 3.6, provided, that, the
registration statement referred to in Section 3.6, including any amendments
thereto, shall be signed by all of the Regular Trustees; and

                          (c)     a Regular 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 purposes of signing any documents which the
Regular Trustees have power and authority to cause the Trust to execute
pursuant to Section 3.6.

                 Section 5.6      Delaware Trustee.

                 The initial Delaware Trustee shall be:

                        The Bank of New York (Delaware)


                 Section 5.7      Appointment, Removal and Resignation of
Trustees.

                      (a)         Subject to Section 5.7(b), Trustees may be
appointed or removed without cause at any time:

                      (i)         until the issuance of any Securities, by
                 written instrument executed by the Sponsor; and





                                     - 27 -
<PAGE>   31




                      (ii)        after the issuance of any Securities, by vote
                 of the Holders of a Majority in liquidation amount of the
                 Common Securities voting as a class at a meeting of the
                 Holders of the Common Securities.

                      (b)

                      (i)         The Trustee that acts as Institutional
                 Trustee shall not be removed in accordance with Section 5.7(a)
                 until a Successor Institutional Trustee has been appointed and
                 has accepted such appointment by written instrument executed
                 by such Successor Institutional Trustee and delivered to the
                 Regular Trustees and the Sponsor; and

                      (ii)        the Trustee that acts as Delaware Trustee
                 shall not be removed in accordance with this Section 5.7(a)
                 until a successor Trustee possessing the qualifications to act
                 as Delaware Trustee under Sections 5.2 and 5.4 (a "Successor
                 Delaware Trustee") has been appointed and has accepted such
                 appointment by written instrument executed by such Successor
                 Delaware Trustee and delivered to the Regular Trustees and the
                 Sponsor.

                          (c)     A Trustee appointed to office shall hold
office until his successor shall have been appointed or until his death,
removal or resignation. Any Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing signed by the
Trustee and delivered to the Sponsor and the Trust, which resignation shall
take effect upon such delivery or upon such later date as is specified therein;
provided, however, that:

                      (i)         No such resignation of the Trustee that acts
                 as the Institutional Trustee shall be effective:

                 (A)       until a Successor Institutional Trustee has been
   appointed and has accepted such appointment by instrument executed by such
   Successor Institutional Trustee and delivered to the Trust, the Sponsor and
   the resigning Institutional Trustee; or

                 (B)      until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the holders of the
Securities; and

                      (ii)        no such resignation of the Trustee that acts
                 as the Delaware Trustee shall be effective until a Successor
                 Delaware Trustee has been appointed and has accepted such
                 appointment by instrument executed by such Successor Delaware
                 Trustee and delivered to the Trust, the Sponsor and the
                 resigning Delaware Trustee.





                                     - 28 -
<PAGE>   32



                          (d)     The Holders of the Common Securities shall
use their best efforts to promptly appoint a Successor Delaware Trustee or
Successor Institutional Trustee as the case may be if the Institutional Trustee
or the Delaware Trustee delivers an instrument of resignation in accordance
with this Section 5.7.

                          (e)     If no Successor Institutional Trustee or
Successor Delaware Trustee shall have been appointed and accepted appointment
as provided in this Section 5.7 within 60 days after delivery to the Sponsor
and the Trust of an instrument of resignation, the resigning Institutional
Trustee or Delaware Trustee, as applicable, may petition any court of competent
jurisdiction for appointment of a Successor Institutional Trustee or Successor
Delaware Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper and prescribe, appoint a Successor Institutional
Trustee or Successor Delaware Trustee, as the case may be.

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

                 Section 5.8      Vacancies among Trustees.

                 If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.1, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Regular Trustees or,
if there are more than two, a majority of the Regular Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 5.7.

                 Section 5.9      Effect of Vacancies.

                 The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul the Trust. Whenever a vacancy in the number
of Regular Trustees shall occur, until such vacancy is filled by the
appointment of a Regular Trustee in accordance with Section 5.7, the Regular
Trustees in office, regardless of their number, shall have all the powers
granted to the Regular Trustees and shall discharge all the duties imposed upon
the Regular Trustees by this Declaration.

                 Section 5.10     Meetings.

                 If there is more than one Regular Trustee, meetings of the
Regular Trustees shall be held from time to time upon the call of any Regular
Trustee. Regular meetings of the Regular Trustees may be held at a time and
place fixed by resolution of the Regular Trustees. Notice of any in-person
meetings of the Regular Trustees shall be hand delivered or otherwise delivered
in writing (including by facsimile, with a hard copy by overnight courier) not
less than 48 hours before such meeting. Notice of any telephonic meetings of
the Regular Trustees or any





                                     - 29 -
<PAGE>   33



committee thereof shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than
24 hours before a meeting. Notices shall contain a brief statement of the time,
place and anticipated purposes of the meeting. The presence (whether in person
or by telephone) of a Regular Trustee at a meeting shall constitute a waiver of
notice of such meeting except where a Regular Trustee attends a meeting for the
express purpose of objecting to the transaction of any activity on the ground
that the meeting has not been lawfully called or convened. Unless provided
otherwise in this Declaration, any action of the Regular Trustees may be taken
at a meeting by vote of a majority of the Regular Trustees present (whether in
person or by telephone) and eligible to vote with respect to such matter,
provided that a Quorum is present, or without a meeting by the unanimous
written consent of the Regular Trustees. In the event there is only one Regular
Trustee, any and all action of such Regular Trustee shall be evidenced by a
written consent of such Regular Trustee.

                 Section 5.11     Delegation of Power.

                          (a)     Any Regular 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 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental filing; and

                          (b)     the Regular Trustees shall have power to
delegate from time to time to such of their number or to officers of the Trust
the doing of such things and the execution of such instruments either in the
name of the Trust or the names of the Regular Trustees or otherwise as the
Regular 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 5.12     Merger, Conversion, Consolidation or
Succession to Business.

                 Any corporation into which the Institutional Trustee or the
Delaware Trustee, as the case may be, may be merged or converted or with which
either may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Institutional Trustee or the Delaware
Trustee, as the case may be, shall be a party, or any corporation succeeding to
all or substantially all the corporate trust business of the Institutional
Trustee or the Delaware Trustee, as the case may be, shall be the successor of
the Institutional Trustee or the Delaware Trustee, as the case may be,
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.





                                     - 30 -
<PAGE>   34




                                   ARTICLE VI
                                 DISTRIBUTIONS

                 Section 6.1      Distributions.

                 Holders shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Preferred Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debenture Issuer makes a payment of
interest (including Compounded Interest (as defined in the Indenture) and
Additional Interest (as defined in the Indenture)), premium and/or principal on
the Debentures held by the Institutional Trustee (the amount of any such
payment being a "Payment Amount"), the Institutional Trustee shall and is
directed, to the extent funds are available for that purpose, to make a
distribution (a "Distribution") of the Payment Amount to Holders.

                                  ARTICLE VII
                             ISSUANCE OF SECURITIES

                 Section 7.1      General Provisions Regarding Securities.

                          (a)     The Regular Trustees shall on behalf of the
Trust issue one class of preferred securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set forth in
Annex I (the "Preferred Securities") and one class of common securities
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Common Securities.") The Trust
shall issue no securities or other interests in the assets of the Trust other
than the Preferred Securities and the Common Securities.

                          (b)     The Certificates shall be signed on behalf of
the Trust by a Regular Trustee. Such signature shall be the manual signature of
any present or any future Regular Trustee. In case any Regular Trustee of the
Trust who shall have signed any of the Securities shall cease to be such
Regular Trustee before the Certificates so signed shall be delivered by the
Trust, such Certificates nevertheless may be delivered as though the person who
signed such Certificates had not ceased to be such Regular Trustee; and any
Certificate may be signed on behalf of the Trust by such persons who, at the
actual date of execution of such Security, shall be the Regular Trustees of the
Trust, although at the date of the execution and delivery of the Declaration
any such person was not such a Regular Trustee.  Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by their execution
thereof, and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements as the Regular Trustees may deem
appropriate, or as may be required to comply with any law or with any rule or
regulation of any stock exchange on which Securities may be listed, or to
conform to usage.





                                     - 31 -
<PAGE>   35




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

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

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

                  Section 7.2     Paying Agent.

                 In the event that the Preferred Securities are not in
book-entry only form, the Trust shall maintain in the Borough of Manhattan,
City of New York, State of New York, an office or agency where the Preferred
Securities may be presented for payment ("Paying Agent). The Trust may appoint
the Paying Agent and may appoint one or more additional paying agents in such
other locations as it shall determine. The term "Paying Agent" includes any
additional paying agent. The Trust may change any Paying Agent without prior
notice to any Holder. The Trust shall notify the Institutional Trustee of the
name and address of any Agent not a party to this Declaration. If the Trust
fails to appoint or maintain another entity as Paying Agent, the Institutional
Trustee shall act as such. The Trust or any of its Affiliates may act as Paying
Agent. The Trust shall initially act as Paying Agent for the Preferred
Securities and the Common Securities.

                                  ARTICLE VIII
                              TERMINATION OF TRUST

                 Section 8.1      Termination of Trust.

                          (a)     The Trust shall terminate:

                          (i)     upon the bankruptcy of the Sponsor;

                          (ii)    upon the filing of a certificate of
                 dissolution or its equivalent with respect to the Sponsor; the
                 filing of a certificate of cancellation with respect to the
                 Trust after having obtained the consent of a majority in
                 liquidation amount of the Securities voting together as a
                 single class to file such certificate of cancellation or the
                 revocation of the Sponsor's charter and the expiration of 90
                 days after the date of revocation without a reinstatement
                 thereof;

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





                                     - 32 -
<PAGE>   36




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

                      (v)         upon the occurrence and continuation of a
                 Special Event pursuant to which the Trust shall have been
                 dissolved in accordance with the terms of the Securities and
                 all of the Debentures endorsed thereon shall have been
                 distributed to the Holders of Securities in exchange for all
                 of the Securities; or

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

                          (b)     As soon as is practicable after the
occurrence of an event referred to in Section 8.1(a), the Trustees shall file a
certificate of cancellation with the Secretary of State of the State of
Delaware.

                          (c)     The provisions of Section 3.9 and Article X
shall survive the termination of the Trust.

                                   ARTICLE IX
                             TRANSFER OF INTERESTS

                 Section 9.1      Transfer of Securities.

                          (a)     Securities may only be transferred, in whole
or in part, in accordance with the terms and conditions set forth in this
Declaration and in the terms of the Securities. Any transfer or purported
transfer of any Security not made in accordance with this Declaration shall be
null and void.

                          (b)     Subject to this Article IX, Preferred 
Securities shall be freely transferable.

                          (c)     The Sponsor may not transfer the Common
Securities.

                 Section 9.2      Transfer of Certificates.

                 The Regular Trustees shall provide for the registration of
Certificates and of transfers of Certificates, which will be effected without
charge but only upon payment (with such indemnity as the Regular Trustees may
require) in respect of any tax or other government charges that may be imposed
in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to
be issued in the name of the designated transferee or transferees. Every
Certificate surrendered for registration of transfer shall be accompanied by a
written instrument of transfer in form satisfactory to the Regular Trustees
duly executed by the Holder or such Holder's attorney duly authorized in





                                     - 33 -
<PAGE>   37



writing. Each Certificate surrendered for registration of transfer shall be
canceled by the Regular Trustees. A transferee of a Certificate shall be
entitled to the rights and subject to the obligations of a Holder hereunder
upon the receipt by such transferee of a Certificate. By acceptance of a
Certificate, each transferee shall be deemed to have agreed to be bound by this
Declaration.

                 Section 9.3      Deemed Security Holders.

                 The Trustees may treat the Person in whose name any
Certificate shall be registered on the books and records of the Trust as the
sole holder of such Certificate and of the Securities represented by such
Certificate for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Certificate or in the Securities represented
by such Certificate on the part of any Person, whether or not the Trust shall
have actual or other notice thereof.

                 Section 9.4      Book Entry Interests.

                 Unless otherwise specified in the terms of the Preferred
Securities, the Preferred Securities Certificates, on original issuance, will
be issued in the form of one or more, fully registered, global Preferred
Security Certificates (each a "Global Certificate"), to be delivered to DTC,
the initial Clearing Agency, by, or on behalf of, the Trust. Such Global
Certificates shall initially be registered on the books and records of the
Trust in the name of Cede & Co., the nominee of DTC, and no Preferred Security
Beneficial Owner will receive a definitive Preferred Security Certificate
representing such Preferred Security Beneficial Owner's interests in such
Global Certificates, except as provided in Section 9.7. Unless and until
definitive, fully registered Preferred Security Certificates (the "Definitive
Preferred Security Certificates") have been issued to the Preferred Security
Beneficial Owners pursuant to Section 9.7:

                          (a)     the provisions of this Section 9.4 shall be
in full force and effect;

                          (b)     the Trust and the Trustees shall be entitled
to deal with the Clearing Agency for all purposes of this Declaration
(including the payment of Distributions on the Global Certificates and
receiving approvals, votes or consents hereunder) as the Holder of the
Preferred Securities and the sole holder of the Global Certificates and shall
have no obligation to the Preferred Security Beneficial Owners;

                          (c)     to the extent that the provisions of this
Section 9.4 conflict with any other provisions of this Declaration, the
provisions of this Section 9.4 shall control; and

                          (d)     the rights of the Preferred Security
Beneficial Owners shall be exercised only through the Clearing Agency and shall
be limited to those established by law and agreements between such Preferred
Security Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants and receive and transmit payments of Distributions on the Global
Certificates to such Clearing Agency Participants. DTC will make book entry
transfers among the Clearing Agency Participants.





                                     - 34 -
<PAGE>   38




                 Section 9.5      Notices to Clearing Agency.

                 Whenever a notice or other communication to the Preferred
Security Holders is required under this Declaration, unless and until
Definitive Preferred Security Certificates shall have been issued to the
Preferred Security Beneficial Owners pursuant to Section 9.7, the Regular
Trustees shall give all such notices and communications specified herein to be
given to the Preferred Security Holders to the Clearing Agency, and shall have
no notice obligations to the Preferred Security Beneficial Owners.

                 Section 9.6      Appointment of Successor Clearing Agency.

                 If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities, the Regular
Trustees may, in their sole discretion, appoint a successor Clearing Agency
with respect to such Preferred Securities.

                 Section 9.7      Definitive Preferred Security Certificates.

                 If:

                          (a)     a Clearing Agency elects to discontinue its
services as securities depositary with respect to the Preferred Securities and
a successor Clearing Agency is not appointed within 90 days after such
discontinuance pursuant to Section 9.6; or

                          (b)     the Regular Trustees elect after consultation
with the Sponsor to terminate the book entry system through the Clearing Agency
with respect to the Preferred Securities,

                 then:

                          (c)     Definitive Preferred Security Certificates
shall be prepared by the Regular Trustees on behalf of the Trust with respect
to such Preferred Securities; and

                          (d)     upon surrender of the Global Certificates by
the Clearing Agency, accompanied by registration instructions, the Regular
Trustees shall cause Definitive Certificates to be delivered to Preferred
Security Beneficial Owners in accordance with the instructions of the Clearing
Agency. Neither the Trustees nor the Trust shall be liable for any delay in
delivery of such instructions and each of them may conclusively rely on and
shall be protected in relying on, said instructions of the Clearing Agency. The
Definitive Preferred Security Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Regular Trustees, as evidenced by their execution thereof, and may have
such letters, numbers or other marks of identification or designation and such
legends or endorsements as the Regular Trustees may deem appropriate, or as may
be required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which Preferred
Securities may be listed, or to conform to usage.





                                     - 35 -
<PAGE>   39




                 Section 9.8      Mutilated, Destroyed, Lost or Stolen
Certificates.

                 If:

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

                          (b)     there shall be delivered to the Regular
Trustees such security or indemnity as may be required by them to keep each of
them harmless. 

then, in the absence of notice that such Certificate shall have been acquired
by a bona fide purchaser, any Regular Trustee on behalf of the Trust shall
execute and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like denomination.
In connection with the issuance of any new Certificate under this Section 9.8,
the Regular Trustees may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
conclusive evidence of an ownership interest in the relevant Securities, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.

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

                 Section 10.1     Liability.

                          (a)     Except as expressly set forth in this
Declara- tion, the Securities Guarantees and the terms of the Securities, the
Sponsor shall not be:

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

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

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

                          (c)     Pursuant to Section  3803(a) of the Business
Trust Act, the Holders of the Preferred Securities shall be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State of Delaware.





                                     - 36 -
<PAGE>   40




                 Section 10.2     Exculpation.

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

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

                 Section 10.3     Fiduciary Duty.

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

                      (b)         Unless otherwise expressly provided herein:

                      (i)         whenever a conflict of interest exists or
                 arises between any Covered Persons; or

                      (ii)        whenever this Declaration or any other
                 agreement contemplated herein or therein provides that an
                 Indemnified Person shall act in a manner that is, or provides
                 terms that are, fair and reasonable to the Trust or any Holder
                 of Securities, the Indemnified Person shall resolve such
                 conflict of interest, take such action or provide such terms,
                 considering in each the relative interest of each party
                 (including its own interest) to such conflict, agreement,
                 transaction or situation and the benefits and burdens relating
                 to such interests, any customary or accepted industry
                 practices, and any applicable generally accepted accounting
                 practices or principles.  In the absence of bad faith by the
                 Indemnified Person, the resolution,





                                     - 37 -
<PAGE>   41



                 action or term so made, taken or provided by the Indemnified
                 Person shall not constitute a breach of this Declaration or
                 any other agreement contemplated herein or of any duty or
                 obligation of the Indemnified Person at law or in equity or
                 otherwise.

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

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

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

                 Section 10.4     Indemnification.

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

                      (ii)        The Debenture Issuer shall indemnify, to the
                 full extent permitted by law, any Company Indemnified Person
                 who was or is a party or is threatened to be made a party to
                 any threatened, pending or completed action or suit by or in
                 the right of the Trust to procure a judgment in its favor by
                 reason of the fact that he is or was a Company Indemnified
                 Person against expenses (including attorneys' fees) actually
                 and reasonably incurred by him in connection with the defense
                 or settlement of such action or suit if he





                                     - 38 -
<PAGE>   42



                 acted in good faith and in a manner he reasonably believed to
                 be in or not opposed to the best interests of the Trust and
                 except that no such indemnification shall be made in respect
                 of any claim, issue or matter as to which such Company
                 Indemnified Person shall have been adjudged to be liable to
                 the Trust unless and only to the extent that the Court of
                 Chancery of Delaware or the court in which such action or suit
                 was brought shall determine upon application that, despite the
                 adjudication of liability but in view of all the circumstances
                 of the case, such person is fairly and reasonably entitled to
                 indemnity for such expenses which such Court of Chancery or
                 such other court shall deem proper.

                      (iii)       To the extent that a Company Indemnified
                 Person shall be successful on the merits or otherwise
                 (including dismissal of an action without prejudice or the
                 settlement of an action without admission of liability) in
                 defense of any action, suit or proceeding referred to in
                 paragraphs (i) and (ii) of this Section 10.4(a), or in defense
                 of any claim, issue or matter therein, he shall be
                 indemnified, to the full extent permitted by law, against
                 expenses (including attorneys' fees) actually and reasonably
                 incurred by him in connection therewith.

                      (iv)        Any indemnification under paragraphs (i) and
                 (ii) of this Section 10.4(a) (unless ordered by a court) shall
                 be made by the Debenture Issuer only as authorized in the
                 specific case upon a determination that indemnification of the
                 Company Indemnified Person is proper in the circumstances
                 because he has met the applicable standard of conduct set
                 forth in paragraphs (i) and (ii). Such determination shall be
                 made (1) by the Regular Trustees by a majority vote of a
                 quorum consisting of such Regular Trustees who were not
                 parties to such action, suit or proceeding, (2) if such a
                 quorum is not obtainable, or, even if obtainable, if a quorum
                 of disinterested Regular Trustees so directs, by independent
                 legal counsel in a written opinion, or (3) by the Common
                 Security Holder of the Trust.

                      (v)         Expenses (including attorneys' fees) incurred
                 by a Company Indemnified Person in defending a civil,
                 criminal, administrative or investigative action, suit or
                 proceeding referred to in paragraphs (i) and (ii) of this
                 Section 10.4(a) shall be paid by the Debenture Issuer in
                 advance of the final disposition of such action, suit or
                 proceeding upon receipt of an undertaking by or on behalf of
                 such Company Indemnified Person to repay such amount if it
                 shall ultimately be determined that he is not entitled to be
                 indemnified by the Debenture Issuer as authorized in this
                 Section 10.4(a).





                                     - 39 -
<PAGE>   43



                 Notwithstanding the foregoing, no advance shall be made by the
                 Debenture Issuer if a determination is reasonably and promptly
                 made (i) by the Regular Trustees by a majority vote of a
                 quorum of disinterested Regular Trustees, (ii) if such a
                 quorum is not obtainable, or, even if obtainable, if a quorum
                 of disinterested Regular Trustees so directs, by independent
                 legal counsel in a written opinion or (iii) the Common
                 Security Holder of the Trust, that, based upon the facts known
                 to the Regular Trustees, counsel or the Common Security Holder
                 at the time such determination is made, such Company
                 Indemnified Person acted in bad faith or in a manner that such
                 person did not believe to be in or not opposed to the best
                 interests of the Trust, or, with respect to any criminal
                 proceeding, that such Company Indemnified Person believed or
                 had reasonable cause to believe his conduct was unlawful. In
                 no event shall any advance be made in instances where the
                 Regular Trustees, independent legal counsel or Common Security
                 Holder reasonably determine that such person deliberately
                 breached his duty to the Trust or its Common or Preferred
                 Security Holders.

                      (vi)        The indemnification and advancement of
                 expenses provided by, or granted pursuant to, the other
                 paragraphs of this Section 10.4(a) shall not be deemed
                 exclusive of any other rights to which those seeking
                 indemnification and advancement of expenses may be entitled
                 under any agreement, vote of stockholders or disinterested
                 directors of the Debenture Issuer or Preferred Security
                 Holders of the Trust or otherwise, both as to action in his
                 official capacity and as to action in another capacity while
                 holding such office. All rights to indemnification under this
                 Section 10.4(a) shall be deemed to be provided by a contract
                 between the Debenture Issuer and each Company Indemnified
                 Person who serves in such capacity at any time while this
                 Section 10.4(a) is in effect. Any repeal or modification of
                 this Section 10.4(a) shall not affect any rights or
                 obligations then existing.

                      (vii)       The Debenture Issuer or the Trust may
                 purchase and maintain insurance on behalf of any person who is
                 or was a Company Indemnified Person against any liability
                 asserted against him and incurred by him in any such capacity,
                 or arising out of his status as such, whether or not the
                 Debenture Issuer would have the power to indemnify him against
                 such liability under the provisions of this Section 10.4(a).

                      (viii)      For purposes of this Section 10.4(a),
                 references to "the Trust" shall include, in addition to the
                 resulting or surviving entity, any constituent entity
                 (including any constituent of a





                                     - 40 -
<PAGE>   44



                 constituent) absorbed in a consolidation or merger, so that
                 any person who is or was a director, trustee, officer or
                 employee of such constituent entity, or is or was serving at
                 the request of such constituent entity as a director, trustee,
                 officer, employee or agent of another entity, shall stand in
                 the same position under the provisions of this Section 10.4(a)
                 with respect to the resulting or surviving entity as he would
                 have with respect to such constituent entity if its separate
                 existence had continued.

                      (ix)        The indemnification and advancement of
                 expenses provided by, or granted pursuant to, this Section
                 10.4(a) shall, unless otherwise provided when authorized or
                 ratified, continue as to a person who has ceased to be a
                 Company Indemnified Person and shall inure to the benefit of
                 the heirs, executors and administrators of such a person.

                          (b)     The Debenture Issuer agrees to indemnify the
(i) Institutional Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of
the Institutional Trustee and the Delaware Trustee, and (iv) any officers,
directors, shareholders, members, partners, employees, representatives,
custodians, nominees or agents of the Institutional Trustee and the Delaware
Trustee (each of the Persons in (i) through (iv) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary 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 or 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 10.4(b) shall survive the
satisfaction and discharge of this Declaration.

                 Section 10.5     Outside Businesses.

                 Any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee, or the Institutional Trustee shall be obligated
to present any particular investment or other opportunity to the Trust even if
such opportunity is of a character that, if presented to the Trust, could be
taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee
and the Institutional Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Covered Person, the Delaware
Trustee and the Institutional Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the
Sponsor, or may act as depositary for, trustee





                                     - 41 -
<PAGE>   45



or agent for, or act on any committee or body of holders of, securities or
other obligations of the Sponsor or its Affiliates.

                                   ARTICLE XI
                                   ACCOUNTING

                 Section 11.1     Fiscal Year.

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

                 Section 11.2     Certain Accounting Matters.

                          (a)     At all times during the existence of the
Trust, the Regular Trustees shall keep, or cause to be kept, full books of
account, records and supporting documents, which shall reflect in reasonable
detail, each transaction of the Trust. The books of account shall be maintained
on the accrual method of accounting, in accordance with generally accepted
accounting principles, consistently applied. The Trust shall use the accrual
method of accounting for United States federal income tax purposes. The books
of account and the records of the Trust shall be examined by and reported upon
as of the end of each Fiscal Year of the Trust by a firm of independent
certified public accountants selected by the Regular Trustees.

                          (b)     The Regular Trustees shall cause to be
prepared and delivered to each of the Holders of Securities, within 90 days
after the end of each Fiscal Year of the Trust, annual financial statements of
the Trust, including a balance sheet of the Trust as of the end of such Fiscal
Year, and the related statements of income or loss;

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

                          (d)     The Regular Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Regular Trustees on behalf of the Trust with any
state or local taxing authority.





                                     - 42 -
<PAGE>   46




                 Section 11.3     Banking.

                 The Trust shall maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that all payments of
funds in respect of the Debentures held by the Institutional Trustee shall be
made directly to the Institutional Trustee Account and no other funds of the
Trust shall be deposited in the Institutional Trustee Account. The sole
signatories for such accounts shall be designated by the Regular Trustees;
provided, however, that the Institutional Trustee shall designate the
signatories for the Institutional Trustee Account.

                 Section 11.4     Withholding.

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

                                  ARTICLE XII
                            AMENDMENTS AND MEETINGS

          Section 12.1        Amendments.

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

                      (i)         the Regular Trustees (or, if there are more
                 than two Regular Trustees a majority of the Regular Trustees);

                      (ii)        if the amendment affects the rights, powers,
                 duties, obligations or immunities of the Institutional
                 Trustee, the Institutional Trustee; and

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





                                     - 43 -
<PAGE>   47




                          (b)     no amendment shall be made, and any such
purported amendment shall be void and ineffective:

                      (i)         unless, in the case of any proposed
                 amendment, the Institutional Trustee shall have first received
                 an Officers' Certificate from each of the Trust and the
                 Sponsor that such amendment is permitted by, and conforms to,
                 the terms of this Declaration (including the terms of the
                 Securities);

                      (ii)        unless, in the case of any proposed amendment
                 which affects the rights, powers, duties, obligations or
                 immunities of the Institutional Trustee, the Institutional
                 Trustee shall have first received:

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

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

                      (iii)       to the extent the result of such amendment
would be to:

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

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

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

                          (c)     at such time after the Trust has issued any
Securities that remain outstanding, any amendment that would adversely affect
the rights, privileges or preferences of any Holder of Securities may be
effected only with such additional requirements as may be set forth in the
terms of such Securities;

                          (d)     Section 9.1(c) and this Section 12.1 shall
not be amended without the consent of all of the Holders of the Securities;

                          (e)     Article IV shall not be amended without the
con- sent of the Holders of a Majority in liquidation amount of the Common
Securities and;





                                     - 44 -
<PAGE>   48




                          (f)     the rights of the holders of the Common
Securities under Article V to increase or decrease the number of, and appoint
and remove Trustees shall not be amended without the consent of the Holders of
a Majority in liquidation amount of the Common Securities; and

                          (g)     notwithstanding Section 12.1(c), this
Declaration may be amended without the consent of the Holders of the Securities
to:

                      (i)         cure any ambiguity;

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

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

                      (iv)        to conform to any change in Rule 3a-5 or
                 written change in interpretation or application of Rule 3a-5
                 by any legislative body, court, government agency or
                 regulatory authority which amendment does not have a material
                 adverse effect on the right, preferences or privileges of the
                 Holders; and

                      (v)         to modify, eliminate and add to any provision
                 of the Amended Declaration to such extent as may be necessary.

                 Section 12.2     Meetings of the Holders of Securities; Action
by Written Consent.

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

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





                                     - 45 -
<PAGE>   49




                      (i)         notice of any such meeting shall be given to
                 all the Holders of Securities having a right to vote thereat
                 at least 7 days and not more than 60 days before the date of
                 such meeting. Whenever a vote, consent or approval of the
                 Holders of Securities is permitted or required under this
                 Declaration or the rules of any stock exchange on which the
                 Preferred Securities are listed or admitted for trading, such
                 vote, consent or approval may be given at a meeting of the
                 Holders of Securities.  Any action that may be taken at a
                 meeting of the Holders of Securities may be taken without a
                 meeting if a consent in writing setting forth the action so
                 taken is signed by the Holders of Securities owning not less
                 than the minimum amount of Securities in liquidation amount
                 that would be necessary to authorize or take such action at a
                 meeting at which all Holders of Securities having a right to
                 vote thereon were present and voting. Prompt notice of the
                 taking of action without a meeting shall be given to the
                 Holders of Securities entitled to vote who have not consented
                 in writing. The Regular Trustees may specify that any written
                 ballot submitted to the Security Holder for the purpose of
                 taking any action without a meeting shall be returned to the
                 Trust within the time specified by the Regular Trustees;

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

                      (iii)       each meeting of the Holders of the Securities
                 shall be conducted by the Regular Trustees or by such other
                 Person that the Regular Trustees may designate; and

                      (iv)        unless the Business Trust Act, this
                 Declaration, the terms of the Securities, the Trust Indenture
                 Act or the listing rules of any stock exchange on which the
                 Preferred Securities are then listed or trading, otherwise
                 provides, the Regular Trustees, in their sole discretion,
                 shall establish all other provisions relating to meetings of
                 Holders of Securities, including notice of the time, place or
                 purpose of any meeting at which any matter is to be voted on
                 by any Holders





                                     - 46 -
<PAGE>   50



                 of Securities, waiver of any such notice, action by consent
                 without a meeting, the establishment of a record date, quorum
                 requirements, voting in person or by proxy or any other matter
                 with respect to the exercise of any such right to vote.

                                  ARTICLE XIII
                    REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
                              AND DELAWARE TRUSTEE

                 Section 13.1     Representations and Warranties of
Institutional Trustee.

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

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

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

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

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

                 Section 13.2     Representations and Warranties of Delaware
Trustee.

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





                                     - 47 -
<PAGE>   51




                          (a)     The Delaware Trustee is a Delaware banking
corporation with trust powers, duly organized, validly existing and in good
standing under the laws of the State of Delaware, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, the Declaration.

                          (b)     The Delaware Trustee has been authorized to
perform its obligations under the Certificate of Trust and the Declaration. The
Declaration under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in
equity or at law).

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

                          (d)     The Delaware Trustee is a natural person who
is a resident of the State of Delaware or, if not a natural person, an entity
which has its principal place of business in the State of Delaware.

                                  ARTICLE XIV
                                 MISCELLANEOUS

          Section 14.1        Notices.

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

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

                          Phillips 66 Capital V
                          c/o Phillips Petroleum Company
                          Phillips Building
                          Barklesville, Oklahoma  74004
                          Attention:  _____________

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





                                     - 48 -
<PAGE>   52




                                  The Bank of New York (Delaware)
                                  White Clay Center, Route 273
                                  Newark, Delaware 19711
                                  Attention:  Corporate Trust Trustee 
                                              Administration
                  
                          (c)     if given to the Institutional Trustee, at the
Institutional Trustee's mailing address set forth below (or such other address
as the Institutional Trustee may give notice of to the Holders of the
Securities):

                                  The Bank of New York
                                  101 Barclay Street, 21 West
                                  New York, New York 10286
                                  Attention:  Corporate Trust Trustee 
                                              Administration

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

                                  Phillips Petroleum Company
                                  Phillips Building
                                  Bartlesville, Oklahoma  74004
                                  Attention:   _______________________

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

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

                 Section 14.2     Governing Law.

                 This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.

                 Section 14.3     Intention of the Parties.

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





                                     - 49 -
<PAGE>   53




                 Section 14.4     Headings.

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

                 Section 14.5     Successors and Assigns.

                 Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed.

                 Section 14.6     Partial Enforceability.

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

                 Section 14.7     Counterparts.

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

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


                                            ----------------------------------
                                            T.C. Morris, as Regular Trustee
                                            
                                            
                                            
                                            ----------------------------------
                                            John A. Carrig, as Regular Trustee
                                            
                                            
                                            
                                            ----------------------------------
                                            R.B. Gisi, as Regular Trustee
                                            
                                            
                                            

                                    - 50 -
<PAGE>   54
                                            
                                            
                                            THE BANK OF NEW YORK (DELAWARE), as
                                            Delaware Trustee
                                            
                                            
                                            
                                            By: 
                                                --------------------------
                                            Name: 
                                            Title:
                                            
                                            THE BANK OF NEW YORK, as 
                                            Institutional Trustee
                                            
                                            
                                            
                                            By: 
                                                --------------------------
                                            Name: 
                                            Title:
                                            
                                            
                                            
                                            PHILLIPS PETROLEUM COMPANY, as 
                                            Sponsor
                                            
                                            
                                            
                                            By: 
                                                --------------------------
                                            Name: 
                                            Title:





                                     - 51 -
<PAGE>   55



                                    ANNEX I

                                    TERMS OF
                   ___% TRUST ORIGINATED PREFERRED SECURITIES
                    ___% TRUST ORIGINATED COMMON SECURITIES


                 Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of _______, 1998 (as amended from time to time,
the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities and the
Common Securities are set out below (each capitalized term used but not defined
herein has the meaning set forth in the Declaration or, if not defined in such
Declaration, as defined in the Prospectus referred to below):

                          1.      Designation and Number.

                          (a)     Preferred Securities. [                  ]
Preferred Securities of the Trust with an aggregate liquidation amount with
respect to the assets of the Trust of [              ] dollars ($[
]) and a liquidation amount with respect to the assets of the Trust of $25 per
preferred security, are hereby designated for the purposes of identification
only as "_____% Trust Originated Preferred Securities(SM) ('TOPrS'(SM))" ( the
"Preferred Securities"). The Preferred Security Certificates evidencing the
Preferred Securities shall be substantially in the form of Exhibit A-1 to the
Declaration, with such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice or to conform to the
rules of any stock exchange on which the Preferred Securities are listed.

                          (b)     Common Securities. [             ] Common
Securities of the Trust with an aggregate liquidation amount with respect to
the assets of the Trust of [           ] dollars ($[          ]) and a
liquidation amount with respect to the assets of the Trust of $25 per common
security, are hereby designated for the purposes of identification only as
"______% Trust Originated Common Securities" (the "Common Securities"). The
Common Security Certificates evidencing the Common Securities shall be
substantially in the form of Exhibit A-2 to the Declaration, with such changes
and additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice.

                          2.      Distributions.

                          (a)     Distributions payable on each Security will
be fixed at a rate per annum of ______% (the "Coupon Rate") of the stated
liquidation amount of $25 per Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions" as used herein includes such cash distributions
and any such interest payable unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available therefor. The amount of Distributions payable for any
period will be





                                     - 1 -
<PAGE>   56



computed for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 90-day quarter.

                          (b)     Distributions on the Securities will be
cumulative, will accrue from ________, 1998, and will be payable quarterly in
arrears, on [March 31, June 30, September 30, and December 31] of each year,
commencing on _______, 1998, except as otherwise described below. The Debenture
Issuer has the right under the Indenture to defer payments of interest by
extending the interest payment period from time to time on the Debentures for a
period not exceeding 20 consecutive quarters or extend beyond the maturity date
of the Debentures (each an "Extension Period"), during which Extension Period
no interest shall be due and payable on the Debentures, provided that no
Extension Period shall last beyond the date of maturity of the Debentures. As a
consequence of such deferral, Distributions will also be deferred. Despite such
deferral, quarterly Distributions will continue to accrue with interest thereon
(to the extent permitted by applicable law) at the Coupon Rate compounded
quarterly during any such Extension Period. Prior to the termination of any
such Extension Period, the Debenture Issuer may further extend such Extension
Period; provided that such Extension Period together with all such previous and
further extensions thereof may not exceed 20 consecutive quarters or extend
beyond the maturity of the Debentures. Payments of accrued Distributions will
be payable to Holders as they appear on the books and records of the Trust on
the first record date after the end of the Extension Period.  Upon the
termination of any Extension Period and the payment of all amounts then due,
the Debenture Issuer may commence a new Extension Period, subject to the above
requirements.

                          (c)     Distributions on the Securities will be
payable to the Holders thereof as they appear on the books and records of the
Trust on the relevant record dates. While the Preferred Securities remain in
book-entry only form, the relevant record dates shall be one Business Day prior
to the relevant payment dates which payment dates correspond to the interest
payment dates on the Debentures. Subject to any applicable laws and regulations
and the provisions of the Declaration, each such payment in respect of the
Preferred Securities will be made as described under the heading "Description
of the Preferred Securities -- Book-Entry Only Issuance -- The Depository Trust
Company" in the Prospectus Supplement dated ______, 1998, to the Prospectus
dated ______, 1998 (together, the "Prospectus"), of the Trust included in the
Registration Statement on Form S-3 of the Sponsor, the Trust and certain other
business trusts.  The relevant record dates for the Common Securities shall be
the same record date as for the Preferred Securities. If the Preferred
Securities shall not continue to remain in book-entry only form, the relevant
record dates for the Preferred Securities, shall conform to the rules of any
securities exchange on which the securities are listed and, if none, shall be
selected by the Regular Trustees, which dates shall be at least one Business
Day but less than 60 Business Days before the relevant payment dates, which
payment dates correspond to the interest payment dates on the Debentures.
Distributions payable on any Securities that are not punctually paid on any
Distribution payment date, as a result of the Debenture Issuer having failed to
make a payment under the Debentures, will cease to be payable to the Person in
whose name such Securities are registered on the relevant record date, and such
defaulted Distribution will instead be payable to





                                     - 2 -
<PAGE>   57



the Person in whose name such Securities are registered on the special record
date or other specified date determined in accordance with the Indenture. If
any date on which Distributions are payable on the Securities is not a Business
Day, then payment of the Distribution payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date.

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

                          3.      Liquidation Distribution Upon Dissolution.

                 In the event of any voluntary or involuntary dissolution,
winding-up or termination of the Trust, the Holders of the Securities on the
date of the dissolution, winding-up or termination, as the case may be, will be
entitled to receive out of the assets of the Trust available for distribution
to Holders of Securities after satisfaction of liabilities of creditors an
amount equal to the aggregate of the stated liquidation amount of $25 per
Security plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"), unless, in connection with
such dissolution, winding-up or termination, Debentures in an aggregate stated
principal amount equal to the aggregate stated liquidation amount of such
Securities, with an interest rate equal to the Coupon Rate of, and bearing
accrued and unpaid interest in an amount equal to the accrued and unpaid
Distributions on, such Securities, shall be distributed on a Pro Rata basis to
the Holders of the Securities in exchange for such Securities.

                 If, upon any such dissolution, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets available to
pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis.

                          4.      Redemption and Distribution.

                          (a)     Upon the repayment of the Debentures in whole
or in part, whether at maturity or upon redemption (either at the option of the
Debenture Issuer or pursuant to a Tax Event as described below), the proceeds
from such repayment or payment shall be simultaneously applied to redeem
Securities having an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so repaid or redeemed at a redemption price
of $25 per Security plus an amount equal to accrued and unpaid Distributions
thereon at the date of the redemption, payable in cash (the "Redemption
Price"). Holders will be given not less than 30 nor more than 60 days notice of
such redemption.





                                     - 3 -
<PAGE>   58




                          (b)     If fewer than all the outstanding Securities
are to be so redeemed, the Common Securities and the Preferred Securities will
be redeemed Pro Rata and the Preferred Securities to be redeemed will be as
described in Section 4(f)(ii) below.

                          (c)     If, at any time, a Tax Event (as defined
below) shall occur and be continuing the Regular Trustees shall, except in
certain limited circumstances described in this Section 4(c), dissolve the
Trust and, after satisfaction of creditors, cause Debentures held by the
Institutional Trustee, having an aggregate principal amount equal to the
aggregate stated liquidation amount of, with an interest rate identical to the
Coupon Rate of, and accrued and unpaid interest equal to accrued and unpaid
Distributions on, and having the same record date for payment as the
Securities, to be distributed to the Holders of the Securities in liquidation
of such Holders' interests in the Trust on a Pro Rata basis, within 90 days
following the occurrence of such Tax Event (the "90 Day Period"); provided,
however, that, as a condition of such dissolution and distribution, the Regular
Trustees shall have received an opinion of a nationally recognized independent
tax counsel experienced in such matters (a "No Recognition Opinion"), which
opinion may rely on published revenue rulings of the Internal Revenue Service,
to the effect that the Holders of the Securities will not recognize any gain or
loss for United States federal income tax purposes as a result of the
dissolution of the Trust and the distribution of Debentures, and provided,
further, that, if at the time there is available to the Trust the opportunity
to eliminate, within the 90 Day Period, the Tax Event by taking some
ministerial action, such as filing a form or making an election, or pursuing
some other similar reasonable measure that has no adverse effect on the Trust,
the Debenture Issuer, the Sponsor or the Holders of the Securities
("Ministerial Action"), the Trust will pursue such Ministerial Action in lieu
of dissolution.

                 If in the event of a Tax Event, (i) after receipt of a Tax
Event Opinion (as defined hereinafter) by the Regular Trustees, the Debenture
Issuer has received an opinion (a "Redemption Tax Opinion") of a nationally
recognized independent tax counsel experienced in such matters that, as a
result of a Tax Event, there is more than an insubstantial risk that the
Debenture Issuer would be precluded from deducting the interest on the
Debentures for United States federal income tax purposes even after the
Debentures were distributed to the Holders of Securities in liquidation of such
Holders' interests in the Trust as described in this Section 4(c), or (ii) the
Regular Trustees shall have been informed by such tax counsel that a No
Recognition Opinion cannot be delivered to the Trust, the Debenture Issuer
shall have the right at any time, upon not less than 30 nor more than 60 days
notice, to redeem the Debentures in whole or in part for cash within 90 days
following the occurrence of such Tax Event, and, following such redemption,
Securities with an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so redeemed shall be redeemed by the Trust
at the Redemption Price on a Pro Rata basis; provided, however, that, if at the
time there is available to the Debenture Issuer or the Trust the opportunity to
eliminate, within such 90 day period, the Special Event by taking some
Ministerial Action, the Trust or the Debenture Issuer will pursue such
Ministerial Action in lieu of redemption.

                 "Tax Event" means that the Regular Trustees shall have
received an opinion of a nationally recognized independent tax counsel
experienced in such matters (a "Dissolution Tax





                                     - 4 -
<PAGE>   59



Opinion") to the effect that on or after the date of the Prospectus Supplement,
as a result of (a) any amendment to, clarification of 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 affecting taxation, (b) any judicial decision, official administrative
pronouncement, ruling, regulatory procedure, notice or announcement, including
any notice or announcement of intent to adopt such procedures or regulations
(an "Administrative Action") or (c) any amendment to, clarification of, or
change in the official position or the interpretation of such Administrative
Action or judicial decision that differs from the theretofore generally
accepted position, in each case, by any legislative body, court, governmental
authority or regulatory body, irrespective of the manner in which such
amendment, clarification or change is made known, which amendment,
clarification, or change is effective or such pronouncement or decision is
announced, in each case, on or after, the first date of issuance of the
Securities, there is more than an insubstantial risk that (i) the Trust is or
will be within 90 days of the date thereof, subject to United States federal
income tax with respect to interest accrued or received on the Debentures, (ii)
the Trust is, or will be within 90 days of the date thereof, subject to more
than a de minimis amount of taxes, duties or other governmental charges, or
(iii) interest payable by the Debenture Issuer to the Trust on the Debentures
is not, or within 90 days of the date thereof will not be, deductible, in whole
or in part, by the Debenture Issuer for United States federal income tax
purposes.

                 On and from the date fixed by the Regular Trustees for any
distribution of Debentures and dissolution of the Trust: (i) the Securities
will no longer be deemed to be outstanding, (ii) The Depository Trust Company
(the "Depository") or its nominee (or any successor Clearing Agency or its
nominee), as the record Holder of the Preferred Securities, will receive a
registered global certificate or certificates representing the Debentures to be
delivered upon such distribution and any certificates representing Securities,
except for certificates representing Preferred Securities held by the
Depository or its nominee (or any successor Clearing Agency or its nominee),
will be deemed to represent beneficial interests in the Debentures having an
aggregate principal amount equal to the aggregate stated liquidation amount of,
with an interest rate identical to the Coupon Rate of, and accrued and unpaid
interest equal to accrued and unpaid Distributions on such Securities until
such certificates are presented to the Debenture Issuer or its agent for
transfer or reissue.

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

                          (e)     If the Debentures are distributed to holders
of the Securities, pursuant to the terms of the Indenture, the Debenture Issuer
will use its best efforts to have the Debentures listed on the New York Stock
Exchange or on such other exchange as the Preferred Securities were listed
immediately prior to the distribution of the Debentures.

                          (f)     "Redemption or Distribution Procedures."





                                     - 5 -
<PAGE>   60




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

                      (ii)        In the event that fewer than all the
                 outstanding Securities are to be redeemed, the Securities to
                 be redeemed shall be redeemed Pro Rata from each Holder of
                 Preferred Securities, it being understood that, in respect of
                 Preferred Securities registered in the name of and held of
                 record by the Depository or its nominee (or any successor
                 Clearing Agency or its nominee) or any nominee, the
                 distribution of the proceeds of such redemption will be made
                 to each Clearing Agency Participant (or Person on whose behalf
                 such nominee holds such securities) in accordance with the
                 procedures applied by such agency or nominee.

                      (iii)       If Securities are to be redeemed and the
                 Trust gives a Redemption/Distribution Notice, which notice may
                 only be issued if the Debentures are redeemed as set out in
                 this Section 4 (which notice will be irrevocable), then (A)
                 while the Preferred Securities are in book-entry only form,
                 with respect to the Preferred Securities, by 12:00 noon, New
                 York City time, on the redemption date, provided that the
                 Debenture Issuer has paid the Institutional Trustee a
                 sufficient amount of cash in connection with the related
                 redemption or maturity of the Debentures, the Institutional
                 Trustee will deposit irrevocably with the Depository or its
                 nominee (or successor Clearing Agency or its nominee) funds
                 sufficient to pay the applicable Redemption Price with respect
                 to the Preferred Securities and will give the Depository
                 irrevocable instructions and authority to pay the Redemption
                 Price to the Holders of the Preferred Securities, and (B) with
                 respect to Preferred Securities issued in definitive form





                                     - 6 -
<PAGE>   61



                 and Common Securities, provided that the Debenture Issuer has
                 paid the Institutional Trustee a sufficient amount of cash in
                 connection with the related redemption or maturity of the
                 Debentures, the Institutional Trustee will pay the relevant
                 Redemption Price to the Holders of such Securities by check
                 mailed to the address of the relevant Holder appearing on the
                 books and records of the Trust on the redemption date. If a
                 Redemption/Distribution Notice shall have been given and funds
                 deposited as required, if applicable, then immediately prior
                 to the close of business on the date of such deposit, or on
                 the redemption date, as applicable, distributions will cease
                 to accrue on the Securities so called for redemption and all
                 rights of Holders of such Securities so called for redemption
                 will cease, except the right of the Holders of such Securities
                 to receive the Redemption Price, but without interest on such
                 Redemption Price. Neither the Regular Trustees nor the Trust
                 shall be required to register or cause to be registered the
                 transfer of any Securities that have been so called for
                 redemption. If any date fixed for redemption of Securities is
                 not a Business Day, then payment of the Redemption Price
                 payable on such date will be made on the next succeeding day
                 that is a Business Day (and without any interest or other
                 payment in respect of any such delay) except that, if such
                 Business Day falls in the next calendar year, such payment
                 will be made on the immediately preceding Business Day, in
                 each case with the same force and effect as if made on such
                 date fixed for redemption. If payment of the Redemption Price
                 in respect of any Securities is improperly withheld or refused
                 and not paid either by the Institutional Trustee or by the
                 Sponsor as guarantor pursuant to the relevant Securities
                 Guarantee, Distributions on such Securities will continue to
                 accrue from the original redemption date to the actual date of
                 payment, in which case the actual payment date will be
                 considered the date fixed for redemption for purposes of
                 calculating the Redemption Price.

                      (iv)        Redemption/Distribution Notices shall be sent
                 by the Regular Trustees on behalf of the Trust to (A) in
                 respect of the Preferred Securities, the Depository or its
                 nominee (or any successor Clearing Agency or its nominee) if
                 the Global Certificates have been issued or, if Definitive
                 Preferred Security Certificates have been issued, to the
                 Holder thereof, and (B) in respect of the Common Securities to
                 the Holder thereof.

                      (v)         Subject to the foregoing and applicable law
                 (including, without limitation, United States federal
                 securities laws), provided the acquiror is not the Holder of
                 the Common Securities or the obligor under the Indenture, the
                 Sponsor or any of its subsidiaries





                                     - 7 -
<PAGE>   62



                 may at any time and from time to time purchase outstanding
                 Preferred Securities by tender, in the open market or by
                 private agreement.

                          5.      Voting Rights - Preferred Securities.

                          (a)     Except as provided under Sections 5(b) and 7
and as otherwise required by law and the Declaration, the Holders of the
Preferred Securities will have no voting rights.

                          (b)     Subject to the requirements set forth in this
paragraph, the Holders of a majority in aggregate liquidation amount of the
Preferred Securities, voting separately as a class may direct the time, method,
and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under the Declaration, including the right to direct the
Institutional Trustee, as holder of the Debentures, to (i) exercise the
remedies available under the Indenture conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under Section ___ of the
Indenture, or (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable, provided,
however, that, where a consent under the Indenture would require the consent or
act of the Holders of greater than a majority of the Holders in principal
amount of Debentures affected thereby, (a "Super Majority"), the Institutional
Trustee may only give such consent or take such action at the written direction
of the Holders of at least the proportion in liquidation amount of the
Preferred Securities which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding. The Institutional
Trustee shall not revoke any action previously authorized or approved by a vote
of the Holders of the Preferred Securities.  Other than with respect to
directing the time, method and place of conducting any remedy available to the
Institutional Trustee or the Debenture Trustee as set forth above, the
Institutional Trustee shall not take any action in accordance with the
directions of the Holders of the Preferred Securities under this paragraph
unless the Institutional Trustee has obtained an opinion of tax counsel to the
effect that for the purposes of United States federal income tax the Trust will
not be classified as other than a grantor trust on account of such action. If a
Declaration Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay interest or
principal on the Debentures on the date such interest or principal is otherwise
payable (or in the case of redemption, on the redemption date), then a holder
of 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 (a "Direct Action") on or after the respective due
date specified in the Debentures. In connection with such Direct Action, the
rights of the holders of the Common Securities Holder will be subrogated to the
rights of such holder of Preferred Securities to the extent of any payment made
by the Issuer to such holder of Preferred Securities in such Direct Action.
Except as provided in the preceding sentences, the Holders of Preferred
Securities will not be able to exercise directly





                                     - 8 -
<PAGE>   63



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

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

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

                          6.      Voting Rights - Common Securities.

                          (a)     Except as provided under Sections 7(b), (c)
and 8 as otherwise required by law and the Declaration, the Holders of the
Common Securities will have no voting rights.

                          (b)     The Holders of the Common Securities are
entitled, in accordance with Article V of the Declaration, to vote to appoint,
remove or replace any Trustee or to increase or decrease the number of
Trustees.

                          (c)     Subject to Section 2.6 of the Declaration and
only after the Event of Default with respect to the Preferred Securities has
been cured, waived, or otherwise eliminated and subject to the requirements of
the second to last sentence of this paragraph, the Holders of a Majority in
liquidation amount of the Common Securities, voting separately as a class, may
direct the time, method, and place of conducting any proceeding for any remedy
available to the Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under the Declaration, including (i)
directing the time, method, place of conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under Section ____ of the
Indenture, or (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable, provided that,
where a consent or action under the Indenture would require the consent or act
of the Holders of greater than a majority in principal amount of Debentures
affected thereby (a "Super Majority"), the Institutional Trustee may only give
such consent or take such action at the written direction of the Holders of at
least the proportion in liquidation





                                     - 9 -
<PAGE>   64



amount of the Common Securities which the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding. Pursuant to this
Section 6(c), the Institutional Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Preferred Securities.
Other than with respect to directing the time, method and place of conducting
any remedy available to the Institutional Trustee or the Debenture Trustee as
set forth above, the Institutional Trustee shall not take any action in
accordance with the directions of the Holders of the Common Securities under
this paragraph unless the Institutional Trustee has obtained an opinion of tax
counsel to the effect that for the purposes of United States federal income tax
the Trust will not be classified as other than a grantor trust on account of
such action. If the Institutional Trustee fails to enforce its rights under the
Declaration, any Holder of Common Securities may institute a legal proceeding
directly against any Person to enforce the Institutional Trustee's rights under
the Declaration, without first instituting a legal proceeding against the
Institutional Trustee or any other Person.

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

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

                          7.      Amendments to Declaration and Indenture.

                          (a)     In addition to any requirements under Section
12.1 of the Declaration, if any proposed amendment to the Declaration provides
for, or the Regular Trustees otherwise propose to effect, (i) any action that
would adversely affect the powers, preferences or special rights of the
Securities, whether by way of amendment to the Declaration or otherwise, or
(ii) the dissolution, winding-up or termination of the Trust, other than as
described in Section 8.1 of the Declaration, then the Holders of outstanding
Securities voting together as a single class, will be entitled to vote on such
amendment or proposal (but not on any other amendment or proposal) and such
amendment or proposal shall not be effective except with the approval of the
Holders of at least a Majority in liquidation amount of the Securities,
affected thereby, provided, however, if any amendment or proposal referred to
in clause (i) above would adversely affect only the Preferred Securities or
only the Common Securities, then only the affected class will be entitled to
vote on such amendment or proposal and such amendment or proposal shall not be
effective except with the approval of a Majority in liquidation amount of such
class of Securities.





                                     - 10 -
<PAGE>   65



                          (b)     In the event the consent of the Institutional
Trustee as the holder of the Debentures is required under the Indenture with
respect to any amendment, modification or termination on the Indenture or the
Debentures, the Institutional Trustee shall request the written direction of
the Holders of the Securities with respect to such amendment, modification or
termination and shall vote with respect to such amendment, modification or
termination as directed by a Majority in liquidation amount of the Securities
voting together as a single class; provided, however, that where a consent
under the Indenture would require the consent of the holders of greater than a
majority in aggregate principal amount of the Debentures (a "Super Majority"),
the Institutional Trustee may only give such consent at the direction of the
Holders of at least the proportion in liquidation amount of the Securities
which the relevant Super Majority represents of the aggregate principal amount
of the Debentures outstanding; provided, further, that the Institutional
Trustee shall not take any action in accordance with the directions of the
Holders of the Securities under this Section 7(b) unless the Institutional
Trustee has obtained an opinion of tax counsel to the effect that for the
purposes of United States federal income tax the Trust will not be classified
as other than a grantor trust on account of such action.

                          8.      Pro Rata.

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

                          9.      Ranking.

                 The Preferred Securities rank pari passu and payment thereon
shall be made Pro Rata with the Common Securities except that, where a
Declaration Event of Default occurs and is continuing the rights of Holders of
the Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment
of the Holders of the Preferred Securities.

                          10.     Listing.

                 The Regular Trustees shall use their best efforts to cause the
Preferred Securities to be listed for quotation on the New York Stock Exchange,
Inc.





                                     - 11 -
<PAGE>   66




                          11.     Acceptance of Securities Guarantee and 
Indenture.

                 Each Holder of Preferred Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.

                          12.     No Preemptive Rights.

                 The Holders of the Securities shall have no preemptive rights
to subscribe for any additional securities.

                          13.     Miscellaneous.

                 These terms constitute a part of the Declaration.

                 The Sponsor will provide a copy of the Declaration, the
Preferred Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), and the Indenture to a Holder without charge on written request
to the Sponsor at its principal place of business.





                                     - 12 -
<PAGE>   67

                                  EXHIBIT A-1

                     FORM OF PREFERRED SECURITY CERTIFICATE

                 This Preferred Security is a Global Certificate within the
meaning of the Declaration hereinafter referred to and is registered in the
name of The Depository Trust Company (the "Depositary") or a nominee of the
Depositary. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than the Depositary or its nominee
only in the limited circumstances described in the Declaration and no transfer
of this Preferred Security (other than a transfer of this Preferred Security as
a whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.

                 Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York, New
York) to the Trust or its agent for registration of transfer, exchange or
payment, and any Preferred Security issued is registered in the name of Cede &
Co. or such other name as requested by an authorized representative of The
Depository Trust Company and any payment hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.

Certificate Number            Number of Preferred Securities

   CUSIP NO. [           ]

                  Certificate Evidencing Preferred Securities

                                       of

                             PHILLIPS 66 CAPITAL V

        ____% Trust Originated Preferred Securities(SM) ("TOPrS"(SM))
               (liquidation amount $25 per Preferred Security)

PHILLIPS 66 CAPITAL V, a statutory business trust formed 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
designated the _____% Trust Originated Preferred Securities(SM) (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. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities represented hereby are issued and shall in all respects be subject
to the provisions of the





                                     - 1 -
<PAGE>   68



Amended and Restated Declaration of Trust of the Trust dated as of _______,
1998, as the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Preferred Securities as set forth
in Annex I to the Declaration. Capitalized terms used herein but not defined
shall have the meaning given them in the Declaration.  The Holder is entitled
to the benefits of the Preferred Securities Guarantee to the extent provided
therein. The Sponsor will provide a copy of the Declaration, the Preferred
Securities Guarantee and the Indenture to a Holder without charge upon written
request to the Trust at its principal place of business.

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

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

                 IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of , 1998.



                                            PHILLIPS 66 CAPITAL V



                                            By: 
                                                --------------------------
                                            Name: 
                                            Title:  Regular Trustee



                         [FORM OF REVERSE OF SECURITY]

                 Distributions payable on each Preferred Security will be fixed
at a rate per annum of ______% (the "Coupon Rate") of the stated liquidation
amount of $__ per Preferred Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions" as used herein includes such cash distributions
and any such interest payable unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available therefor. The amount of Distributions payable for any
period will be computed for any full quarterly Distribution period on the basis
of a 360-day year of twelve 30-day months, and for any period shorter than a
full quarterly Distribution period for which Distributions are computed,
Distributions will be computed on the basis of the actual number of days
elapsed per 90-day quarter.





                                     - 2 -
<PAGE>   69




                 Except as otherwise described below, distributions on the
Preferred Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on [March 31, June 30,
September 30 and December 31] of each year, commencing on ________, 1998, to
[Holders of record fifteen (15) days prior to such payment dates, which payment
dates shall correspond to the interest payment dates on the Debentures.] The
Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), provided that no Extension Period shall last beyond the
date of the maturity of the Debentures and as a consequence of such deferral,
Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate compounded quarterly during any
such Extension Period. Prior to the termination of any such Extension Period,
the Debenture Issuer may further extend such Extension Period; provided that
such Extension Period together with all such previous and further extensions
thereof may not exceed 20 consecutive quarters or extend beyond the maturity of
the Debentures. Payments of accrued Distributions will be payable to Holders as
they appear on the books and records of the Trust on the first record date
after the end of the Extension Period. Upon the termination of any Extension
Period and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.

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





                                     - 3 -
<PAGE>   70



                                _______________


                                   ASSIGNMENT

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


      -----------------------------------------------------------------
       (Insert assignee's social security or tax identification number)

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

      -----------------------------------------------------------------
                  (Insert address and zip code of assignee)

and irrevocably appoints

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

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


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

Date: 
     -------------------

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





                                     - 1 -
<PAGE>   71



                                  EXHIBIT A-2

                      FORM OF COMMON SECURITY CERTIFICATE

Certificate Number             Number of Common Securities

                    Certificate Evidencing Common Securities

                                       of

                             PHILLIPS 66 CAPITAL V

                   ______% Trust Originated Common Securities
                  (liquidation amount $25 per Common Security)


                 PHILLIPS 66 CAPITAL V, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that
_________________ (the "Holder") is the registered owner of common securities
of the Trust representing undivided beneficial interests in the assets of the
Trust designated the ______% Trust Originated Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). The Common
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities represented hereby are issued and shall in all respects be subject
to the provisions of the Amended and Restated Declaration of Trust of the Trust
dated as of _______, 1998, as the same may be amended from time to time (the
"Declaration"), including the designation of the terms of the Common Securities
as set forth in Annex I to the Declaration. Capitalized terms used herein but
not defined shall have the meaning given them in the Declaration. The Holder is
entitled to the benefits of the Common Securities Guarantee to the extent
provided therein. The Sponsor will provide a copy of the Declaration, the
Common Securities Guarantee and the Indenture to a Holder without charge upon
written request to the Sponsor at its principal place of business.

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

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





                                     - 1 -
<PAGE>   72




                 IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of , 1998.

                                        PHILLIPS 66 CAPITAL V



                                        By: 
                                            ----------------------------
                                            Name: 
                                            Title: Regular Trustee





                                     - 2 -
<PAGE>   73



                         [FORM OF REVERSE OF SECURITY]



                 Distributions payable on each Common Security will be fixed at
a rate per annum of ______% (the "Coupon Rate") of the stated liquidation
amount of $__ per Common Security, such rate being the rate of interest payable
on the Debentures to be held by the Institutional Trustee. Distributions in
arrears for more than one quarter will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash distributions and any
such interest payable unless otherwise stated. A Distribution is payable only
to the extent that payments are made in respect of the Debentures held by the
Institutional Trustee and to the extent the Institutional Trustee has funds
available therefor. The amount of Distributions payable for any period will be
computed for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 90-day quarter.

                 Except as otherwise described below, distributions on the
Common Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on [March 31, June 30,
September 30 and December 31] of each year, commencing on ________, 1998, to
Holders of record fifteen (15) days prior to such payment dates, which payment
dates shall correspond to the interest payment dates on the Debentures. The
Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), provided that no Extension Period shall last beyond the
date of the maturity of the Debentures and as a consequence of such deferral,
Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate compounded quarterly during any
such Extension Period. Prior to the termination of any such Extension Period,
the Debenture Issuer may further extend such Extension Period; provided that
such Extension Period together with all such previous and further extensions
thereof may not exceed 20 consecutive quarters or extend beyond the maturity
date of the Debentures. Payments of accrued Distributions will be payable to
Holders as they appear on the books and records of the Trust on the first
record date after the end of the Extension Period. Upon the termination of any
Extension Period and the payment of all amounts then due, the Debenture Issuer
may commence a new Extension Period, subject to the above requirements.

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





                                     - 3 -
<PAGE>   74





                                _______________


                                   ASSIGNMENT

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

      -----------------------------------------------------------------
       (Insert assignee's social security or tax identification number)

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

      -----------------------------------------------------------------
                  (Insert address and zip code of assignee)

and irrevocably appoints

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

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


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

Date: 
     -------------------

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




                                     - 1 -
<PAGE>   75



                                   EXHIBIT B

                             SPECIMEN OF DEBENTURE





<PAGE>   76



                                   EXHIBIT C

                             UNDERWRITING AGREEMENT



                                      C-1