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EXHIBIT 10.1

PLAINS ALL AMERICAN

2005 LONG-TERM INCENTIVE PLAN

     
SECTION 1.     Purpose
of the Plan.

     
The Plains All American 2005 Long-Term Incentive
Plan (the “Plan”) has been adopted by Plains All
American GP LLC, a Delaware limited liability company (the
“Company”), the general partner of Plains All American
Pipeline, L.P., a Delaware limited partnership (the
“Partnership”), and is intended to promote the
interests of the Partnership and the Company by providing to
employees, and directors of the Company and its Affiliates
incentive compensation awards for superior performance that are
based on Units. The Plan is also contemplated to enhance the
ability of the Company, the Partnership and their Affiliates to
attract and retain the services of individuals who are essential
for the growth and profitability of the Partnership and to
encourage them to devote their best efforts to advancing the
business of the Partnership and their respective employers.

     
SECTION 2.     Definitions.

     
As used in the Plan, the following terms shall
have the meanings set forth below:

		
	 	     
    “Affiliate” means, with respect to any
    Person, any other Person that directly or indirectly through one
    or more intermediaries controls, is controlled by or is under
    common control with, the Person in question. As used herein, the
    term “control” means the possession, direct or
    indirect, of the power to direct or cause the direction of the
    management and policies of a Person, whether through ownership
    of voting securities, by contract or otherwise.
    
	 
	 	     
    “Award” means an Option, Restricted
    Unit, Phantom Unit or Unit Appreciation Right granted under the
    Plan, and may include any tandem DERs granted with respect to a
    Phantom Unit, Option or Unit Appreciation Right.
    
	 
	 	     
    “Award Agreement” means the written
    agreement by which an Award shall be evidenced, and which may
    describe any terms, conditions, criteria, restrictions or other
    elements of such Award as determined by the Committee in its
    discretion.
    
	 
	 	     
    “Board” means the Board of Directors of
    the Company.
    
	 
	 	     
    “Committee” means the Compensation
    Committee of the Board.
    
	 
	 	     
    “DER” means a contingent right, granted
    in tandem with a specific Option, Unit Appreciation Right or
    Phantom Unit, to receive an amount in cash equal to the cash
    distributions made by the Partnership with respect to a Unit
    during the period such Award is outstanding.
    
	 
	 	     
    “Director” means a member of the Board
    who is not an Employee.
    
	 
	 	     
    “Employee” means any employee of the
    Company or an Affiliate.
    
	 
	 	     
    “Exchange Act” means the Securities
    Exchange Act of 1934, as amended.
    
	 
	 	     
    “Fair Market Value” means the closing
    sales price of a Unit on the applicable date preceding the
    applicable date (or if there is no trading in the Units on such
    date, on the next preceding date on which there was trading) or
    (other than with respect to establishing the exercise price of
    an Option or Unit Appreciation Right) as defined in an Award
    Agreement. In the event Units are not publicly traded at the
    time a determination of fair market value is required to be made
    hereunder, the determination of fair market value shall be made
    in good faith by the Committee.
    
	 
	 	     
    “Option” means an option to purchase
    Units granted under the Plan.
    
	 
	 	     
    “Participant” means any Employee, or
    Director granted an Award under the Plan.
    

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    “Partnership Agreement” means the Third
    Amended and Restated Agreement of Limited Partnership of Plains
    All American Pipeline L.P., as it may be amended or amended and
    restated from time to time.
    
	 
	 	     
    “Person” means an individual or a
    corporation, limited liability company, partnership, joint
    venture, trust, unincorporated organization, association,
    government agency or political subdivision thereof or other
    entity.
    
	 
	 	     
    “Phantom Unit” means a phantom
    (notional) Unit granted under the Plan that upon vesting
    entitles the Participant to receive a Unit or an amount of cash
    equal to the Fair Market Value of a Unit, as determined by the
    Committee in its discretion.
    
	 
	 	     
    “Restricted Period” means the period
    established by the Committee with respect to an Award during
    which the Award or Unit may remain subject to restrictions
    established by the Committee, including without limitation a
    period during which such Award or Unit is subject to forfeiture
    or restrictions on transfer, or is not yet exercisable by or
    payable to the Participant, as the case may be. As the context
    requires the word “vest” and its derivatives refers to
    the lapse of some or all, as the case may be, of the
    restrictions imposed during such Restricted Period.
    
	 
	 	     
    “Restricted Unit” means a Unit
    delivered under the Plan that is subject to a Restricted Period.
    
	 
	 	     
    “Rule 16b-3” means Rule 16b-3
    promulgated by the SEC under the Exchange Act, or any successor
    rule or regulation thereto as in effect from time to time.
    
	 
	 	     
    “SEC” means the Securities and Exchange
    Commission, or any successor thereto.
    
	 
	 	     
    “UDR” means a distribution made by the
    Partnership with respect to a Restricted Unit.
    
	 
	 	     
    “Unit” means a Common Unit of the
    Partnership.
    
	 
	 	     
    “Unit Appreciation Right” means an
    Award that, upon exercise, entitles the holder to receive the
    excess of the Fair Market Value of Unit on the exercise date
    over the exercise price established for such Unit Appreciation
    Right. Such excess may be paid in cash and/or in Units as
    determined by the Committee in its discretion.
    

     
SECTION 3.     Administration.

     
The Plan shall be administered by the Committee.
A majority of the Committee shall constitute a quorum, and the
acts of the members of the Committee who are present at any
meeting thereof at which a quorum is present, or acts
unanimously approved by the members of the Committee in writing,
shall be the acts of the Committee. Subject to the following and
applicable law, the Committee, in its sole discretion, may
delegate any or all of its powers and duties under the Plan,
including the power to grant Awards under the Plan, to the Chief
Executive Officer of the Company, subject to such limitations on
such delegated powers and duties as the Committee may impose, if
any. Upon any such delegation all references in the Plan to the
“Committee”, other than in Section 7, shall be
deemed to include the Chief Executive Officer; provided,
however, that such delegation shall not limit the Chief
Executive Officer’s right to receive Awards under the Plan.
Notwithstanding the foregoing, the Chief Executive Officer may
not grant Awards to, or take any action with respect to any
Award previously granted to, a person who is an officer subject
to Rule 16b-3 or a member of the Board. Subject to the
terms of the Plan and applicable law, and in addition to other
express powers and authorizations conferred on the Committee by
the Plan, the Committee shall have full power and authority to:
(i) designate Participants; (ii) determine the type or
types of Awards to be granted to a Participant;
(iii) determine the number of Units to be covered by
Awards; (iv) determine the terms and conditions of any
Award; (v) determine whether, to what extent, and under what
circumstances Awards may be settled (including settlement in
cash), exercised, canceled, or forfeited; (vi) interpret and
administer the Plan and any instrument or agreement relating to
an Award made under the Plan; (vii) establish, amend,
suspend, or waive such rules and regulations and appoint such
agents as it shall deem appropriate for the proper
administration of the Plan; and (viii) make any other
determination and take any other action that the Committee deems
necessary

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or desirable for the administration of the Plan.
Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations, and other
decisions under or with respect to the Plan or any Award shall
be within the sole discretion of the Committee, may be made at
any time and shall be final, conclusive, and binding upon all
Persons, including the Company, the Partnership, any Affiliate,
any Participant, and any beneficiary of any Award.

     
SECTION 4.     Units.

     
(a) Limits on Units Deliverable.
Subject to adjustment as provided in Section 4(c), the
number of Units that may be actually delivered with respect to
Awards under the Plan is 3,000,000. If any Award is forfeited,
cancelled, exercised or otherwise terminated without the actual
delivery of Units pursuant to such Award, including any Award
under which Units are held back to cover the exercise price or
tax withholding, such Units shall be available to satisfy future
Awards under the Plan; provided, however, the issuance of a
Restricted Unit will be an “actual delivery” for
purposes of the preceding; thus, any Restricted Unit used to
cover an exercise price or tax withholding obligation shall not
become available to satisfy future Awards under the Plan. There
shall not be any limitation on the number of Awards that may be
granted and paid in cash.

     
(b) Sources of Units Deliverable Under
Awards. Any Units delivered pursuant to an Award shall
consist, in whole or in part, of Units acquired in the open
market, from any Affiliate, the Partnership or any other Person,
or any combination of the foregoing.

     
(c) Adjustments. In the event that
the Committee determines that any distribution (whether in the
form of cash, Units, other securities, or other property),
recapitalization, split, reverse split, reorganization, merger,
change of control, consolidation, split-up, spin-off,
combination, repurchase, or exchange of Units or other
securities of the Partnership, issuance of warrants or other
rights to purchase Units or other securities of the Partnership,
or other similar transaction or event affects the Units such
that an adjustment is determined by the Committee to be
appropriate in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available
under the Plan, then the Committee shall, in such manner as it
may deem equitable, adjust any or all of (i) the number and
type of Units (or other securities or property) with respect to
which Awards may be granted, (ii) the number and type of
Units (or other securities or property) subject to outstanding
Awards, and (iii) the grant or exercise price with respect
to any Award or, if deemed appropriate, make provision for a
cash payment to the holder of an outstanding Award; provided,
that the number of Units subject to any Award shall always be a
whole number.

     
SECTION 5.     Eligibility.

     
Any Employee or Director shall be eligible to be
designated a Participant and receive an Award under the Plan.

     
SECTION 6.     Awards.

     
(a) Options. The Committee shall have
the authority to determine the Employees and Directors to whom
Options shall be granted, the number of Units to be covered by
each Option, whether DERs are granted with respect to such
Option, the purchase price therefor and the conditions and
limitations applicable to the exercise of the Option, including
the following terms and conditions and such additional terms and
conditions, as the Committee shall determine, that are not
inconsistent with the provisions of the Plan.

		
	 	     
    (i) Exercise Price. The purchase
    price per Unit purchasable under an Option shall be determined
    by the Committee at the time the Option is granted but may not
    be less than the Fair Market Value of a Unit as of the date of
    grant.
    
	 
	 	     
    (ii) Time and Method of Exercise. The
    Committee shall determine the Restricted Period, i.e., the time
    or times at which an Option may be exercised in whole or in
    part, and the method or methods by which payment of the exercise
    price with respect thereto may be made or deemed to have been
    made, which may include, without limitation, cash, check
    acceptable to the Company, a
    

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    “cashless-broker” exercise through
    procedures approved by the Company, other securities or other
    property, a note (in a form acceptable to the Company), or any
    combination thereof, having a Fair Market Value on the exercise
    date equal to the relevant exercise price.
    
	 
	 	     
    (iii) Forfeitures. Except as
    otherwise provided in the terms of the Option Award Agreement,
    upon termination of a Participant’s employment with the
    Company and its Affiliates or membership on the Board, whichever
    is applicable, for any reason during the applicable Restricted
    Period, all Options shall be forfeited by the Participant.
    
	 
	 	     
    (iv) Option DERs. To the extent
    provided by the Committee, in its discretion, an Options Award
    Agreement may include a tandem DER grant, which may provide that
    such DERs shall be paid directly to the Participant, be credited
    to a bookkeeping account (with or without interest in the
    discretion of the Committee) subject to the same vesting
    restrictions as the tandem Options Award, or be subject to such
    other provisions or restrictions as determined by the Committee
    in its discretion.
    

     
(b) Restricted Units and Phantom
Units. The Committee shall have the authority to determine
the Employees and Directors to whom Restricted Units or Phantom
Units shall be granted, the number of Restricted Units or
Phantom Units to be granted to each such Participant, the
Restricted Period, the conditions under which the Restricted
Units or Phantom Units may become vested or forfeited, and such
other terms and conditions as the Committee may establish with
respect to such Awards, including whether DERs are granted with
respect to the Phantom Units.

		
	 	     
    (i) DERs. To the extent provided by
    the Committee, in its discretion, a Phantom Units Award
    Agreement may include a tandem DER grant, which may provide that
    such DERs shall be paid directly to the Participant, be credited
    to a bookkeeping account (with or without interest in the
    discretion of the Committee) subject to the same vesting
    restrictions as the tandem Phantom Unit Award, or be subject to
    such other provisions or restrictions as determined by the
    Committee in its discretion.
    
	 
	 	     
    (ii) UDRs. To the extent provided by
    the Committee, in its discretion, a Restricted Units Award
    Agreement may provide that distributions made by the Partnership
    with respect to the Restricted Units shall be subject to the
    same forfeiture and other restrictions as the Restricted Unit
    and, if restricted, such distributions shall be held, without
    interest, until the Restricted Unit vests or is forfeited with
    the UDR being paid or forfeited at the same time, as the case
    may be. Absent such a restriction on the UDRs in the Award
    Agreement, UDRs shall be paid to the holder of the Restricted
    Unit without restriction.
    
	 
	 	     
    (iii) Forfeitures. Except as
    otherwise provided in the terms of the Restricted Units or
    Phantom Units Award Agreement, upon termination of a
    Participant’s employment with the Company and its
    Affiliates or membership on the Board, whichever is applicable,
    for any reason during the applicable Restricted Period, all
    outstanding Restricted Units and Phantom Units awarded the
    Participant shall be automatically forfeited on such termination.
    
	 
	 	     
    (iv) Lapse of Restrictions.
    

		
	 	     
    (A) Phantom Units. Upon or as soon as
    reasonably practical following the vesting of each Phantom Unit,
    subject to the provisions of Section 8(b), the Participant
    shall be entitled to receive from the Company one Unit or cash
    equal to the Fair Market Value of a Unit, as determined by the
    Committee in its discretion.
    
	 
	 	     
    (B) Restricted Units. Upon or as soon
    as reasonably practical following the vesting of each Restricted
    Unit, subject to the provisions of Section 8(b), the
    Participant shall be entitled to have the relevant restrictions
    removed from his or her Unit certificate.
    

     
(c) Unit Appreciation Rights. The
Committee shall have the authority to determine the Employees
and Directors to whom Unit Appreciation Rights shall be granted,
the number of Units to be covered by each Award Agreement,
whether DERs are granted with respect to such Unit Appreciation
Right, the exercise price therefor and the conditions and
limitations applicable to the exercise of the Unit

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Appreciation Right, including the following terms
and conditions and such additional terms and conditions, as the
Committee shall determine, that are not inconsistent with the
provisions of the Plan.

		
	 	     
    (i) Exercise Price. The exercise
    price per Unit Appreciation Right shall be determined by the
    Committee at the time the Unit Appreciation Right is granted but
    may not be less than the Fair Market Value of a Unit as of the
    date of grant.
    
	 
	 	     
    (ii) Time of Exercise. The Committee
    shall determine the Restricted Period, i.e., the time or times
    at which a Unit Appreciation Right may be exercised in whole or
    in part.
    
	 
	 	     
    (iii) Forfeitures. Except as
    otherwise provided in the terms of the Unit Appreciation Right
    Award Agreement, upon termination of a Participant’s
    employment with the Company and its Affiliates or membership on
    the Board, whichever is applicable, for any reason during the
    applicable Restricted Period, all outstanding Unit Appreciation
    Rights awarded the Participant shall be automatically forfeited
    on such termination. The Committee may, in its discretion, waive
    in whole or in part such forfeiture with respect to a
    Participant’s Unit Appreciation Rights.
    
	 
	 	     
    (iv) Unit Appreciation Right DERs. To
    the extent provided by the Committee, in its discretion, a Unit
    Appreciation Rights Award Agreement may include a tandem DER
    grant, which may provide that such DERs shall be paid directly
    to the Participant, be credited to a bookkeeping account (with
    or without interest in the discretion of the Committee) subject
    to the same vesting restrictions as the tandem Unit Appreciation
    Rights Award, or be subject to such other provisions or
    restrictions as determined by the Committee in its discretion.
    

     
(d) General.

		
	 	     
    (i) Awards May Be Granted Separately or
    Together. Awards may, in the discretion of the Committee, be
    granted either alone or in addition to, in tandem with, or in
    substitution for any other Award granted under the Plan or any
    award granted under any other plan of the Company or any
    Affiliate. Awards granted in addition to or in tandem with other
    Awards or awards granted under any other plan of the Company or
    any Affiliate may be granted either at the same time as or at a
    different time from the grant of such other Awards or awards.
    
	 
	 	     
    (ii) Limits on Transfer of Awards.
    

		
	 	     
    (A) Except as provided in (C) below,
    each Option and Unit Appreciation Right shall be exercisable
    only by the Participant during the Participant’s lifetime,
    or by the person to whom the Participant’s rights shall
    pass by will or the laws of descent and distribution.
    
	 
	 	     
    (B) Except as provided in (C) below, no
    Award and no right under any such Award may be assigned,
    alienated, pledged, attached, sold or otherwise transferred or
    encumbered by a Participant otherwise than by will or by the
    laws of descent and distribution and any such purported
    assignment, alienation, pledge, attachment, sale, transfer or
    encumbrance shall be void and unenforceable against the Company,
    the Partnership or any Affiliate.
    
	 
	 	     
    (C) To the extent specifically provided by
    the Committee with respect to an Option or Unit Appreciation
    Right Award Agreement, an Option or Unit Appreciation Right may
    be transferred by a Participant without consideration to
    immediate family members or related family trusts, limited
    partnerships or similar entities or on such terms and conditions
    as the Committee may from time to time establish.
    

		
	 	     
    (iii) Term of Awards. The term of
    each Award shall be for such period as may be determined by the
    Committee.
    
	 
	 	     
    (iv) Unit Certificates. All
    certificates for Units or other securities of the Partnership
    delivered under the Plan pursuant to any Award or the exercise
    thereof shall be subject to such stop transfer orders and other
    restrictions as the Committee may deem advisable under the Plan
    or the rules, regulations, and other requirements of the SEC,
    any stock exchange upon which such Units or other
    

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    securities are then listed, and any applicable
    federal or state laws, and the Committee may cause a legend or
    legends to be put on any such certificates to make appropriate
    reference to such restrictions.
    
	 
	 	     
    (v) Consideration for Grants. Awards
    may be granted for such consideration, including services, as
    the Committee determines.
    
	 
	 	     
    (vi) Delivery of Units or other
    Securities and Payment by Participant of Consideration.
    Notwithstanding anything in the Plan or any Award Agreement to
    the contrary, delivery of Units pursuant to the exercise or
    vesting of an Award may be deferred for any period during which,
    in the good faith determination of the Committee, the Company is
    not reasonably able to obtain Units to deliver pursuant to such
    Award without violating the rules or regulations of any
    applicable law or securities exchange. No Units or other
    securities shall be delivered pursuant to any Award until
    payment in full of any amount required to be paid pursuant to
    the Plan or the applicable Award Agreement (including, without
    limitation, any exercise price or tax withholding) is received
    by the Company. Such payment may be made by such method or
    methods and in such form or forms as the Committee shall
    determine, including without limitation cash, other Awards,
    withholding of Units, cashless broker exercises with
    simultaneous sale, or any combination thereof; provided that the
    combined value, as determined by the Committee, of all cash and
    cash equivalents and the Fair Market Value of any such Units or
    other property so tendered to the Company, as of the date of
    such tender, is at least equal to the full amount required to be
    paid to the Company pursuant to the Plan or the applicable Award
    Agreement.
    
	 
	 	     
    (vii) Change of Control. If
    specifically provided in an Award Agreement, upon a change of
    control (as defined in the Award Agreement) the Award may
    automatically vest and be payable or become exercisable in full,
    as the case may be.
    
	 
	 	     
    (viii) Substitute Awards. Awards may
    be granted under the Plan in substitution for similar awards
    held by individuals who become employees as a result of a
    merger, consolidation or acquisition by the Company or an
    Affiliate of another entity or the assets of another entity. To
    the extent permitted by section 409A of the Internal
    Revenue Code and the regulations thereunder, such substitute
    Awards may have exercise prices less than the Fair Market Value
    of a Unit on the date of such substitution.
    

     
SECTION 7.     Amendment
and Termination.

     
Except to the extent prohibited by applicable law:

		
	 	     
    (a) Amendments to the Plan. Except as
    required by the rules of the principal securities exchange on
    which the Units are traded and subject to Section 7(b)
    below, the Board or the Committee may amend, alter, suspend,
    discontinue, or terminate the Plan in any manner, including
    increasing the number of Units available for Awards under the
    Plan, without the consent of any partner, Participant, other
    holder or beneficiary of an Award, or other Person.
    
	 
	 	     
    (b) Amendments to Awards. Subject to
    Section 7(a), the Committee may waive any conditions or
    rights under, amend any terms of, or alter any Award theretofore
    granted (including without limitation requiring or allowing for
    an election to settle an Award in cash), provided no change,
    other than pursuant to Section 7(c), in any Award shall
    (i) materially reduce the benefit to Participant without
    the consent of such Participant or (ii) cause the Plan or
    such Award to fail to comply with the requirements of
    Section 409A of the Internal Revenue Code.
    
	 
	 	     
    (c) Adjustment of Awards Upon the
    Occurrence of Certain Unusual or Nonrecurring Events. The
    Committee is hereby authorized to make adjustments in the terms
    and conditions of, and the criteria included in, Awards in
    recognition of unusual or nonrecurring events (including,
    without limitation, the events described in Section 4(c) of
    the Plan) affecting the Partnership or the financial statements
    of the Partnership, or of changes in applicable laws,
    regulations, or accounting principles, whenever the Committee
    determines that such adjustments are appropriate in order to
    prevent dilution or enlargement of the benefits or potential
    benefits intended to be made available under the
    

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    Plan or such Award; provided, however, that no
    such adjustment may be made that would cause the Plan or such
    Award to fail to comply with the requirements of
    Section 409A of the Internal Revenue Code.
    

     
SECTION 8.     General
Provisions.

     
(a) No Rights to Award. No Person
shall have any claim to be granted any Award under the Plan, and
there is no obligation for uniformity of treatment of
Participants. The terms and conditions of Awards need not be the
same with respect to each recipient.

     
(b) Tax Withholding. The Company or
any Affiliate is authorized to withhold from any Award, from any
payment due or transfer made under any Award or from any
compensation or other amount owing to a Participant the amount
(in cash, Units, other securities, Units that would otherwise be
issued pursuant to such Award or other property) of any
applicable taxes payable in respect of the grant of an Award,
its exercise, the lapse of restrictions thereon, or any payment
or transfer under an Award or under the Plan and to take such
other action as may be necessary in the opinion of the Company
to satisfy its withholding obligations for the payment of such
taxes.

     
(c) No Right to Employment or
Services. The grant of an Award shall not be construed as
giving a Participant the right to be retained in the employ of
the Company or any Affiliate, or to remain on the Board, as
applicable. Further, the Company or an Affiliate may at any time
dismiss a Participant from employment, free from any liability
or any claim under the Plan, unless otherwise expressly provided
in the Plan, any Award Agreement or other agreement.

     
(d) Governing Law. The validity,
construction, and effect of the Plan and any rules and
regulations relating to the Plan shall be determined in
accordance with the laws of the State of Delaware without regard
to its conflict of laws principles.

     
(e) Severability. If any provision of
the Plan or any Award is or becomes or is deemed to be invalid,
illegal, or unenforceable in any jurisdiction or as to any
Person or Award, or would disqualify the Plan or any Award under
any law deemed applicable by the Committee, such provision shall
be construed or deemed amended to conform to the applicable
laws, or if it cannot be construed or deemed amended without, in
the determination of the Committee, materially altering the
intent of the Plan or the Award, such provision shall be
stricken as to such jurisdiction, Person or Award and the
remainder of the Plan and any such Award shall remain in full
force and effect.

     
(f) Other Laws. The Committee may
refuse to issue or transfer any Units or other consideration
under an Award if, in its sole discretion, it determines that
the issuance or transfer of such Units or such other
consideration might violate any applicable law or regulation,
the rules of the principal securities exchange on which the
Units are then traded, or entitle the Partnership or an
Affiliate to recover the same under Section 16(b) of the
Exchange Act, and any payment tendered to the Company by a
Participant, other holder or beneficiary in connection with the
exercise of such Award shall be promptly refunded to the
relevant Participant, holder or beneficiary.

     
(g) No Trust or Fund Created. Neither
the Plan nor any Award shall create or be construed to create a
trust or separate fund of any kind or a fiduciary relationship
between the Company or any participating Affiliate and a
Participant or any other Person. To the extent that any Person
acquires a right to receive payments from the Company or any
participating Affiliate pursuant to an Award, such right shall
be no greater than the right of any general unsecured creditor
of the Company or any participating Affiliate.

     
(h) No Fractional Units. No
fractional Units shall be issued or delivered pursuant to the
Plan or any Award, and the Committee shall determine whether
cash, other securities, or other property shall be paid or
transferred in lieu of any fractional Units or whether such
fractional Units or any rights thereto shall be canceled,
terminated, or otherwise eliminated.

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(i) Headings. Headings are given to
the Sections and subsections of the Plan solely as a convenience
to facilitate reference. Such headings shall not be deemed in
any way material or relevant to the construction or
interpretation of the Plan or any provision thereof.

     
(j) Facility Payment. Any amounts
payable hereunder to any person under legal disability or who,
in the judgment of the Committee, is unable to properly manage
his financial affairs, may be paid to the legal representative
of such person, or may be applied for the benefit of such person
in any manner which the Committee may select, and the Company
shall be relieved of any further liability for payment of such
amounts.

     
(k) Participation by Affiliates. In
making Awards to Employees employed by an entity other than by
the Company, the Committee shall be acting on behalf of the
Affiliate, and to the extent the Partnership has an obligation
to reimburse the Company for compensation paid to Employees for
services rendered for the benefit of the Partnership, such
payments or reimbursement payments may be made by the
Partnership directly to the Affiliate, and, if made to the
Company, shall be received by the Company as agent for the
Affiliate.

     
(l) Gender and Number. Words in the
masculine gender shall include the feminine gender, the plural
shall include the singular and the singular shall include the
plural.

     
(m) Compliance with
Section 409A. Nothing in the Plan or any Award
Agreement shall operate or be construed to cause the Plan or an
Award to fail to comply with Section 409A of the Internal
Revenue Code. The applicable provisions of Section 409A and
the regulations thereunder are hereby incorporated by reference
into and shall control over any Plan or Award Agreement
provision in conflict therewith or that would cause a failure of
compliance thereunder, to the extent necessary to resolve such
conflict or obviate such failure.

     
SECTION 9.     Term
of the Plan.

     
The Plan shall be effective on the date of its
approval by the unitholders and shall continue until the
earliest of (i) the date terminated by the Board or the
Committee, or (ii) all available Units under the Plan have
been paid to Participants, whichever occurs first. However,
unless otherwise expressly provided in the Plan or in an
applicable Award Agreement, any Award granted prior to such
termination, and the authority of the Board or the Committee to
amend, alter, adjust, suspend, discontinue, or terminate any
such Award or to waive any conditions or rights under such
Award, shall extend beyond such termination date.
Notwithstanding anything in the Plan to the contrary, no Awards
may become vested, and no Units may be issued under the Plan,
prior to the date the Plan is approved by the unitholders of the
Partnership.

8<PAGE>
                                                                   EXHIBIT 10.10

                    AMENDED AND RESTATED DECLARATION OF TRUST

                                       OF

                                  BOFI TRUST I

                          Dated as of December 16, 2004

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
<S>               <C>                                                                                                   <C>
                                    ARTICLE I
                         INTERPRETATION AND DEFINITIONS                                                                 Page
                                                                                                                        -----
Section 1.1.      Definitions..........................................................................................   1

                                   ARTICLE II
                                  ORGANIZATION

Section 2.1.      Name.................................................................................................   9
Section 2.2.      Office...............................................................................................   9
Section 2.3.      Purpose..............................................................................................   9
Section 2.4.      Authority............................................................................................  10
Section 2.5.      Title to Property of the Trust.......................................................................  10
Section 2.6.      Powers and Duties of the Trustees and the Administrators.............................................  10
Section 2.7.      Prohibition of Actions by the Trust and the Trustees.................................................  15
Section 2.8.      Powers and Duties of the Institutional Trustee.......................................................  16
Section 2.9.      Certain Duties and Responsibilities of the Trustees and the Administrators...........................  17
Section 2.10.     Certain Rights of Institutional Trustee..............................................................  19
Section 2.11.     Delaware Trustee.....................................................................................  21
Section 2.12.     Execution of Documents...............................................................................  21
Section 2.13.     Not Responsible for Recitals or Issuance of Securities...............................................  22
Section 2.14.     Duration of Trust....................................................................................  22
Section 2.15.     Mergers..............................................................................................  22

                                   ARTICLE III
                                     SPONSOR

Section 3.1.      Sponsor's Purchase of Common Securities..............................................................  24
Section 3.2.      Responsibilities of the Sponsor......................................................................  24

                                   ARTICLE IV
                           TRUSTEES AND ADMINISTRATORS

Section 4.1.      Number of Trustees...................................................................................  24
Section 4.2.      Delaware Trustee.....................................................................................  25
Section 4.3.      Institutional Trustee; Eligibility...................................................................  25
Section 4.4.      Administrators.......................................................................................  26
Section 4.5.      Appointment, Removal and Resignation of the Trustees and the Administrators..........................  26
Section 4.6.      Vacancies Among Trustees.............................................................................  28
Section 4.7.      Effect of Vacancies..................................................................................  28
Section 4.8.      Meetings of the Trustees and the Administrators......................................................  28
</TABLE>

<PAGE>

<TABLE>
<S>               <C>                                                                                                    <C>
Section 4.9.      Delegation of Power..................................................................................  28
Section 4.10.     Merger, Conversion, Consolidation or Succession to Business..........................................  29

                                    ARTICLE V
                                  DISTRIBUTIONS

Section 5.1.      Distributions........................................................................................  29

                                   ARTICLE VI
                             ISSUANCE OF SECURITIES

Section 6.1.      General Provisions Regarding Securities..............................................................  29
Section 6.2.      Paying Agent, Transfer Agent, Calculation Agent and Registrar........................................  30
Section 6.3.      Form and Dating......................................................................................  31
Section 6.4.      Mutilated, Destroyed, Lost or Stolen Certificates....................................................  31
Section 6.5.      Temporary Certificates...............................................................................  32
Section 6.6.      Cancellation.........................................................................................  32
Section 6.7.      Rights of Holders; Waivers of Past Defaults..........................................................  32

                                   ARTICLE VII
                      DISSOLUTION AND TERMINATION OF TRUST

Section 7.1.      Dissolution and Termination of Trust.................................................................  34

                                  ARTICLE VIII
                              TRANSFER OF INTERESTS

Section 8.1.      General..............................................................................................  35
Section 8.2.      Transfer Procedures and Restrictions.................................................................  36
Section 8.3.      Deemed Security Holders..............................................................................  39
Section 8.4.      Transfer of Initial Securities.......................................................................  40

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

Section 9.1.      Liability............................................................................................  40
Section 9.2.      Exculpation..........................................................................................  41
Section 9.3.      Fiduciary Duty.......................................................................................  41
Section 9.4.      Indemnification......................................................................................  42
Section 9.5.      Outside Businesses...................................................................................  45
Section 9.6.      Compensation; Fee....................................................................................  45

                                    ARTICLE X
                                   ACCOUNTING

Section 10.1.     Fiscal Year..........................................................................................  46
Section 10.2.     Certain Accounting Matters...........................................................................  46
Section 10.3.     Banking..............................................................................................  47
Section 10.4.     Withholding..........................................................................................  47
</TABLE>

                                       ii

<PAGE>

<TABLE>
<S>               <C>                                                                                                    <C>
                                   ARTICLE XI
                             AMENDMENTS AND MEETINGS

Section 11.1.     Amendments...........................................................................................  48
Section 11.2.     Meetings of the Holders of the Securities; Action by Written Consent.................................  50

                                   ARTICLE XII
          REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE

Section 12.1.     Representations and Warranties of Institutional Trustee..............................................  51
Section 12.2.     Representations and Warranties of Delaware Trustee...................................................  52

                                  ARTICLE XIII
                                  MISCELLANEOUS

Section 13.1.     Notices..............................................................................................  53
Section 13.2.     Governing Law........................................................................................  53
Section 13.3.     Submission to Jurisdiction...........................................................................  54
Section 13.4.     Intention of the Parties.............................................................................  54
Section 13.5.     Headings.............................................................................................  54
Section 13.6.     Successors and Assigns...............................................................................  54
Section 13.7.     Partial Enforceability...............................................................................  55
Section 13.8.     Counterparts.........................................................................................  55

                              ANNEXES AND EXHIBITS

ANNEX I           Terms of Capital Securities and Common Securities

EXHIBIT A-1       Form of Capital Security Certificate
EXHIBIT A-2       Form of Common Security Certificate
EXHIBIT B         Form of Transferee Certificate to be Executed by Accredited Investors
EXHIBIT C         Form of Transferor Certificate to be Executed for QIBs
EXHIBIT D         Form of Transferee Certificate to be Executed by Non-U.S. Persons
</TABLE>
                                      iii
<PAGE>

                    AMENDED AND RESTATED DECLARATION OF TRUST

                                       OF

                                  BOFI TRUST I

                                December 16, 2004

            AMENDED AND RESTATED DECLARATION OF TRUST (as amended or
supplemented from time to time in accordance with the terms hereof, this
"Declaration"), dated and effective as of December 16, 2004, by the Trustees (as
defined herein), the Administrators (as defined herein), the Sponsor (as defined
herein) and the holders from time to time of undivided beneficial interests in
the assets of the Trust (as defined herein) to be issued pursuant to this
Declaration.

            WHEREAS, certain of the Trustees and the Sponsor established BofI
Trust I (the "Trust"), a statutory trust under the Statutory Trust Act (as
defined herein), pursuant to a Declaration of Trust, dated as of December 13,
2004 (the "Original Declaration"), and a Certificate of Trust filed with the
Secretary of State of the State of Delaware on December 13, 2004, for the sole
purpose of issuing and selling the Securities (as defined herein) representing
undivided beneficial interests in the assets of the Trust, investing the
proceeds thereof in the Debentures (as defined herein) of the Debenture Issuer
(as defined herein) and engaging in those activities necessary, advisable or
incidental thereto;

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

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

            NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a statutory trust under the Statutory Trust Act and that
this Declaration constitutes the governing instrument of such statutory trust,
and 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, subject to the
provisions of this Declaration, and, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties, intending to be legally bound hereby, amend
and restate in its entirety the Original Declaration and agree as follows:

                                   ARTICLE I

                         INTERPRETATION AND DEFINITIONS

            Section 1.1. Definitions. Unless the context otherwise requires:

<PAGE>

            (a) capitalized terms used in this Declaration but not defined in
the preamble above or elsewhere herein have the respective meanings assigned to
them in this Section 1.1 or, if not defined in this Section 1.1 or elsewhere
herein, in the Indenture;

            (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 and each Annex and Exhibit hereto, as modified, supplemented or
amended from time to time;

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

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

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

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

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

            "Administrators" means each of Gary Lewis Evans, Andrew J.
Micheletti and Michelle Paulus, solely in such Person's capacity as
Administrator of the Trust continued hereunder and not in such Person's
individual capacity, or such Administrator's successor in interest in such
capacity, or any successor appointed as herein provided.

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

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

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

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

            (b) such Person commences a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, consents
to the entry of an order for relief in an involuntary case under any such law,
or consents to the appointment of or

                                       2
<PAGE>

taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of such Person or of any substantial part
of its property, or makes any general assignment for the benefit of creditors,
or fails generally to pay its debts as they become due.

            "Business Day" means any day other than Saturday, Sunday or any
other day on which banking institutions in Wilmington, Delaware, The City of New
York or Sacramento, California are permitted or required by law or executive
order to close.

            "Calculation Agent" has the meaning set forth in Section 1.01 of the
Indenture.

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

            "Capital Security Certificate" means a definitive Certificate
registered in the name of the Holder representing a Capital Security
substantially in the form of Exhibit A-1.

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

            "Certificate" means any certificate evidencing Securities.

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

            "Closing Date" has the meaning set forth in the Purchase Agreement.

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

            "Commission" means the United States Securities and Exchange
Commission.

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

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

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

            "Corporate Trust Office" means the office of the Institutional
Trustee at which at any particular time its corporate trust business shall be
principally administered, which at all times shall be located within the United
States and at the time of execution of this Declaration shall be Rodney Square
North, 1100 North Market Street, Wilmington, DE 19890-0001, Attention: Corporate
Capital Markets.

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

                                       3
<PAGE>

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

            "Debenture Issuer" means BofI Holding, Inc., a savings and loan
holding company incorporated in the State of Delaware, in its capacity as issuer
of the Debentures under the Indenture, and any permitted successor under the
Indenture.

            "Debenture Trustee" means Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely as trustee under
the Indenture until a successor is appointed thereunder, and thereafter means
such successor trustee.

            "Debentures" means the Floating Rate Junior Subordinated Debt
Securities due 2035 to be issued by the Debenture Issuer under the Indenture.

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

            "Deferred Interest" means any interest on the Debentures that would
have been overdue and unpaid for more than one Distribution Payment Date but for
the imposition of an Extension Period, and the interest that shall accrue (to
the extent that the payment of such interest is legally enforceable) on such
interest at the Coupon Rate applicable during such Extension Period, compounded
quarterly from the date on which such Deferred Interest would otherwise have
been due and payable until paid or made available for payment.

            "Definitive Capital Securities" means any Capital Securities in
definitive form issued by the Trust.

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

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

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

            "Distribution Payment Date" has the meaning set forth in paragraph
2(e) of Annex I.

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

            "Event of Default" means the occurrence of an Indenture Event of
Default.

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

            "Extension Period" has the meaning set forth in paragraph 2(e) of
Annex I.

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

                                       4
<PAGE>

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

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

            "Guarantee" means the Guarantee Agreement, dated as of the Closing
Date, of the Sponsor (the "Guarantor") in respect of the Capital Securities.

            "Holder" means a Person in whose name a Certificate representing a
Security is registered on the Securities Register maintained by or on behalf of
the Registrar, such Person being a beneficial owner within the meaning of the
Statutory Trust Act.

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

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

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

            "Institutional Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 4.3.

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

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

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

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

            "LIBOR" means the London Interbank Offered Rate for three-month U.S.
Dollar deposits in Europe as determined by the Calculation Agent according to
paragraph 2(b) of Annex I.

            "LIBOR Banking Day" has the meaning set forth in paragraph 2(b)(1)
of Annex I.

            "LIBOR Business Day" has the meaning set forth in paragraph 2(b)(1)
of Annex I.

                                       5
<PAGE>

            "LIBOR Determination Date" has the meaning set forth in paragraph
2(b)(1) of Annex I.

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

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

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

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

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

            "Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person or, in the case of
a natural Person, 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 Authorized Officer or Person, as the case
may be, signing the Officers' Certificate has read the covenant or condition and
the definitions relating thereto;

            (b) a brief statement of the nature and scope of the examination or
investigation undertaken by each Authorized Officer or Person, as the case may
be, in rendering the Officers' Certificate;

            (c) a statement that each Authorized Officer or Person, as the case
may be, has made such examination or investigation as, in his or her opinion, is
necessary to enable such Authorized Officer or Person, as the case may be, 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 Authorized
Officer or Person, as the case may be, such condition or covenant has been
complied with.

            "OTS" means the Office of Thrift Supervision.

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

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

                                       6
<PAGE>

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

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

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

            "Purchase Agreement" means the Purchase Agreement relating to the
offer and sale of Capital Securities.

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

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

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

            "Purchaser" means Sandler O'Neill & Partners, L.P.

            "QIB" means a "qualified institutional buyer" as defined under Rule
144A.

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

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

            "Reference Banks" has the meaning set forth in paragraph 2(b)(2) of
Annex I.

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

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

            "Resale Restriction Termination Date" means, with respect to any
Capital Security, the date which is the later of (i) two years (or such shorter
period of time as permitted by Rule 144(k) under the Securities Act) after the
later of (y) the date of original issuance of such Capital Security and (z) the
last date on which the Trust or any Affiliate of the Trust was the Holder of
such Capital Security (or any predecessor thereto) and (ii) such later date, if
any, as may be required by any subsequent change in applicable law.

            "Responsible Officer" means, with respect to the Institutional
Trustee, any officer within the Corporate Trust Office of the Institutional
Trustee with direct responsibility for the administration of this Declaration,
including any vice-president, any assistant vice-president, any secretary, any
assistant secretary, the treasurer, any assistant treasurer, any trust officer
or other officer of the Corporate Trust Office of the Institutional Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means,

                                       7
<PAGE>

with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of that officer's knowledge of and familiarity
with the particular subject.

            "Restricted Securities Legend" has the meaning set forth in Section
8.2(c).

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

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

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

            "Securities" means the Common Securities and the Capital Securities.

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

            "Securities Register" has the meaning set forth in Section 6.2(a).

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

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

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

            "Sponsor" means BofI Holding, Inc., a savings and loan holding
company that is incorporated in the State of Delaware, or any permitted
successor of the Debenture Issuer under the Indenture, in its capacity as
sponsor of the Trust.

            "Statutory 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.

            "Successor Delaware Trustee" has the meaning set forth in Section
4.5(e).

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

            "Successor Institutional Trustee" has the meaning set forth in
Section 4.5(b).

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

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

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

            "Telerate Page 3750" has the meaning set forth in paragraph 2(b)(1)
of Annex I.

            "10% in liquidation amount of the Securities" means Holders of
outstanding Securities voting together as a single class or, as the context may
require, Holders of outstanding

                                       8
<PAGE>

Capital Securities or Holders of outstanding Common Securities voting separately
as a class, who are the record owners of 10% or more of the aggregate
liquidation amount (including the stated amount that would be paid upon the
redemption, liquidation or otherwise on the date upon which the voting
percentages are determined, plus unpaid Distributions accrued thereon to such
date) of all outstanding Securities of the relevant class.

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

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

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

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

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

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

                                   ARTICLE II
                                  ORGANIZATION

            Section 2.1. Name. The Trust is named "BofI Trust I," as such name
may be modified from time to time by the Administrators following written notice
to the Institutional Trustee and the Holders of the Securities. The Trust's
activities may be conducted under the name of the Trust or any other name deemed
advisable by the Administrators.

            Section 2.2. Office. The address of the principal office of the
Trust, which shall be in a state of the United States or the District of
Columbia, is 12220 El Camino Real, Suite 220, San Diego, California, 92130. On
ten Business Days' written notice to the Institutional Trustee and the Holders
of the Securities, the Administrators may designate another principal office,
which shall be in a state of the United States or the District of Columbia.

            Section 2.3. Purpose. The exclusive purposes and functions of the
Trust are (a) to issue and sell the Securities representing undivided beneficial
interests in the assets of the Trust, (b) to invest the gross proceeds from such
sale in the Debentures and (c) except as

                                       9
<PAGE>

otherwise limited herein, to engage in only those other activities deemed
necessary, advisable or incidental thereto by the Institutional Trustee,
including, without limitation, those activities specified in this Declaration.
The Trust shall not borrow money, issue debt or reinvest proceeds derived from
investments, pledge any of its assets, or otherwise undertake (or permit to be
undertaken) any activity that would cause the Trust not to be classified for
United States federal income tax purposes as a grantor trust.

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

            Section 2.5. Title to Property of the Trust. Except as provided in
Section 2.6(g) and Section 2.8 with respect to the Debentures and the Property
Account or as otherwise provided in this Declaration, legal title to all assets
of the Trust shall be vested in the Trust. The Holders shall not have legal
title to any part of the assets of the Trust, but shall have an undivided
beneficial interest in the assets of the Trust.

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

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

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

                        (A) the issuance and sale of the Securities;

                        (B) to cause the Trust to enter into, and to execute,
                  deliver and perform on behalf of the Trust, such agreements as
                  may be necessary or desirable in connection with the purposes
                  and function of the Trust, including agreements with the
                  Paying Agent, a subscription agreement for Debentures between
                  the Trust and the Sponsor, a subscription agreement

                                       10
<PAGE>

                  for Capital Securities between the Trust and the purchaser of
                  the Capital Securities and a subscription agreement for Common
                  Securities between the Trust and the Sponsor;

                        (C) ensuring compliance with the Securities Act and
                  applicable securities or blue sky laws of states and other
                  jurisdictions;

                        (D) if and at such time determined solely by the Sponsor
                  at the request of the Holders, assisting in the designation of
                  the Capital Securities for trading in the Private Offering,
                  Resales and Trading through the Automatic Linkages ("PORTAL")
                  system if available;

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

                        (F) the appointment of a Paying Agent, Transfer Agent
                  and Registrar in accordance with this Declaration;

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

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

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

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

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

                                       11
<PAGE>

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

                        (M) to negotiate the terms of, and the execution and
                  delivery of, the Purchase Agreement and any other related
                  agreements providing for the sale of the Capital Securities or
                  the resale thereof by the Purchaser;

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

                        (O) to incur expenses that are necessary, advisable or
                  incidental to carry out any of the purposes of the Trust;

                        (P) 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 an
                  Administrator; and

                        (Q) 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 trust under the laws of each jurisdiction (other
                  than the State of Delaware) in which such existence is
                  necessary to protect the limited liability of the Holders of
                  the Capital Securities or to enable the Trust to effect the
                  purposes for which the Trust was created.

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

                        (A) the establishment of the Property Account;

                        (B) the receipt of the Debentures;

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

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

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

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

                                       12
<PAGE>

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

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

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

                        (J) 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 trust under the laws of the State of Delaware to
                  protect the limited liability of the Holders of the Capital
                  Securities or to enable the Trust to effect the purposes for
                  which the Trust was created; and

                        (K) to undertake any actions set forth in Section 317(a)
                  of the Trust Indenture Act.

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

            (b) So long as this Declaration remains in effect, the Trust (or the
Trustees or Administrators acting on behalf of the Trust) shall not undertake
any business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, neither the Trustees nor the Administrators
may cause the Trust to (i) acquire any investments or engage in any activities
not authorized by this Declaration, (ii) sell, assign, transfer, exchange,
mortgage, pledge, set-off or otherwise dispose of any of the Trust Property or
interests therein, including to Holders, except as expressly provided herein,
(iii) take any action that would cause (or in the case of the Institutional
Trustee, to the actual knowledge of a Responsible Officer would cause) the Trust
to fail or cease to qualify as a grantor trust for United States federal income
tax purposes, (iv) incur any indebtedness for borrowed money or issue any other
debt or (v) take or consent to any action that would result in the placement of
a lien on any of the Trust

                                       13
<PAGE>
Property. The Institutional Trustee shall, at the sole cost and expense of the
Trust subject to reimbursement under Section 9.6(a), defend all claims and
demands of all Persons at any time claiming any lien on any of the Trust
Property adverse to the interest of the Trust or the Holders in their capacity
as Holders.

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

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

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

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

            (d) Notwithstanding anything herein to the contrary, the
Administrators, the Institutional Trustee and the Holders of a Majority in
liquidation amount of the Common Securities are authorized and directed to
conduct the affairs of the Trust and to operate the Trust so that (i) the Trust
will not be deemed to be an Investment Company required to be registered under
the Investment Company Act (in the case of the Institutional Trustee, to the
actual knowledge of a Responsible Officer), and (ii) the Trust will not fail to
be classified as a grantor trust for United States federal income tax purposes
(in the case of the Institutional Trustee, to the actual knowledge of a
Responsible Officer) and (iii) the Trust will not take any action inconsistent
with the treatment of the Debentures as indebtedness of the Debenture Issuer for
United States federal income tax purposes (in the case of the Institutional
Trustee, to the actual knowledge of a Responsible Officer). In this connection,
the Institutional Trustee, the Administrators and the Holders of a Majority in
liquidation amount of the Common Securities are authorized to take any action,
not inconsistent with applicable laws or this Declaration, as amended from time
to time, that each of the Institutional Trustee, the Administrators and such
Holders determine in their discretion to be necessary or desirable for such
purposes, even if such action adversely affects the interests of the Holders of
the Capital Securities.

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

                                       14
<PAGE>

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

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

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

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

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

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

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

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

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

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

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

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

                                       15
<PAGE>

            Section 2.8. Powers and Duties of the Institutional Trustee.

            (a) The legal title to the Debentures shall be owned by and held of
record in the name of the Institutional Trustee in trust for the benefit of the
Trust. The right, title and interest of the Institutional Trustee to the
Debentures shall vest automatically in each Person who may hereafter be
appointed as Institutional Trustee in accordance with Section 4.5. Such vesting
and cessation of title shall be effective whether or not conveyancing documents
with regard to the Debentures have been executed and delivered.

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

            (c) The Institutional Trustee shall:

                  (i) establish and maintain a segregated non-interest bearing
            trust account (the "Property Account") in the United States (as
            defined in Treasury Regulations Section 301.7701-7), in the name of
            and under the exclusive control of the Institutional Trustee, and
            maintained in the Institutional Trustee's trust department, on
            behalf of the Holders of the Securities and, upon the receipt of
            payments of funds made in respect of the Debentures held by the
            Institutional Trustee, deposit such funds into the Property Account
            and make payments to the Holders of the Capital Securities and
            Holders of the Common Securities from the Property Account in
            accordance with Section 5.1. Funds in the Property Account shall be
            held uninvested until disbursed in accordance with this Declaration;

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

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

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

            (e) The Institutional Trustee may bring or defend, pay, collect,
compromise, arbitrate, resort to legal action with respect to, or otherwise
adjust claims or demands of or against, the Trust (a "Legal Action") which arise
out of or in connection with an Event of Default of which a Responsible Officer
of the Institutional Trustee has actual knowledge or the Institutional Trustee's
duties and obligations under this Declaration or the Trust Indenture Act;
provided, however, that if an Event of Default has occurred and is continuing
and such event is attributable to the failure of the Debenture Issuer to pay
interest or premium, if any, on or principal of the Debentures on the date such
interest, premium, if any, or principal is otherwise payable (or in the case of
redemption, on the date of redemption), then a Holder of the Capital

                                       16
<PAGE>

Securities may directly institute a proceeding for enforcement of payment to
such Holder of the principal of or premium, if any, or interest that is so
payable on the Debentures having a principal amount equal to the aggregate
liquidation amount of the Capital Securities of such Holder (a "Direct Action")
on or after the respective due date specified in the Debentures. In connection
with such Direct Action, the rights of the Holders of the Common Securities will
be subrogated to the rights of such Holder of the Capital Securities to the
extent of any payment made by the Debenture Issuer to such Holder of the Capital
Securities in such Direct Action; provided, however, that a Holder of the Common
Securities may exercise such right of subrogation only if no Event of Default
with respect to the Capital Securities has occurred and is continuing.

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

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

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

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

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

            Section 2.9. Certain Duties and Responsibilities of the Trustees and
the Administrators.

            (a) The Institutional Trustee, before the occurrence of any Event of
Default (of which the Institutional Trustee has knowledge (as provided in
Section 2.10(m) hereof)) 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 (of
which the Institutional Trustee has knowledge (as provided in Section 2.10(m)
hereof)), has occurred (that has not been cured or waived pursuant to Section
6.7), the Institutional Trustee shall exercise such of the rights and powers
vested in it by this Declaration, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.

            (b) The duties and responsibilities of the Trustees and the
Administrators shall be as provided by this Declaration and, in the case of the
Institutional Trustee, by the Trust

                                       17
<PAGE>

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

            (c) All payments made by the Institutional Trustee or a Paying Agent
in respect of the Securities shall be made only from the revenue and proceeds
from the Trust Property and only to the extent that there shall be sufficient
revenue or proceeds from the Trust Property to enable the Institutional Trustee
or a Paying Agent to make payments in accordance with the terms hereof. Each
Holder, by its acceptance of a Security, agrees that it will look solely to the
revenue and proceeds from the Trust Property to the extent legally available for
distribution to it as herein provided and that the Trustees and the
Administrators are not personally liable to it for any amount distributable in
respect of any Security or for any other liability in respect of any Security.
This Section 2.9(c) does not limit the liability of the Trustees expressly set
forth elsewhere in this Declaration or, in the case of the Institutional
Trustee, in the Trust Indenture Act.

            (d) 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 or bad faith with
respect to matters that are within the authority of the Institutional Trustee
under this Declaration, except that:

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

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

                                       18
<PAGE>

            Institutional Trustee, or exercising any trust or power conferred
            upon the Institutional Trustee under this Declaration;

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

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

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

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

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

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

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

                                       19
<PAGE>

            (d) whenever in the administration of this Declaration, the
Institutional Trustee shall deem it desirable that a matter be proved or
established before undertaking, suffering or omitting any action hereunder, the
Institutional Trustee (unless other evidence is herein specifically prescribed)
may, 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 Administrators;

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

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

            (g) the Institutional Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at the
request or direction of any of the Holders pursuant to this Declaration, unless
such Holders shall have offered to the Institutional Trustee security or
indemnity reasonably satisfactory to it against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction; provided, that nothing contained in this Section 2.10(g) shall be
taken to relieve the Institutional Trustee, upon the occurrence of an Event of
Default (of which the Institutional Trustee has knowledge (as provided in
Section 2.10(m) hereof)) that has not been cured or waived, of its obligation to
exercise the rights and powers vested in it by this Declaration;

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

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

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

                                       20
<PAGE>

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

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

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

            (m) the Institutional Trustee shall not be charged with knowledge of
an Event of Default unless a Responsible Officer of the Institutional Trustee
has actual knowledge of such event or the Institutional Trustee receives written
notice of such event from any Holder, except that the Institutional Trustee
shall be deemed to have knowledge of any Event of Default pursuant to Sections
5.01(a), 5.01(b) or 5.01(c) of the Indenture (other than an Event of Default
resulting from the default in the payment of Additional Amounts if the
Institutional Trustee does not have actual knowledge or written notice that such
payment is due and payable);

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

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

            Section 2.11. Delaware Trustee. Notwithstanding any other provision
of this Declaration other than Section 4.2, the Delaware Trustee shall not be
entitled to exercise any powers, and the Delaware Trustee shall not have any of
the duties and responsibilities of any of the Trustees or the Administrators
specified in this Declaration (except as may be required under the Statutory
Trust Act). Except as set forth in Section 4.2, the Delaware Trustee shall be a
Trustee for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Statutory Trust Act.

            Section 2.12. Execution of Documents. Unless otherwise determined in
writing by the Institutional Trustee, and except as otherwise required by the
Statutory Trust Act, the Institutional Trustee, or any one or more of the
Administrators, as the case may be, is authorized

                                       21
<PAGE>

to execute and deliver on behalf of the Trust any documents, agreements,
instruments or certificates that the Trustees or the Administrators, as the case
may be, have the power and authority to execute pursuant to Section 2.6.

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

            Section 2.14. Duration of Trust. The Trust, unless dissolved
pursuant to the provisions of Article VII hereof, shall have existence for five
(5) years after the Maturity Date.

            Section 2.15. Mergers. (a) The Trust may not consolidate,
amalgamate, merge with or into, or be replaced by, or convey, transfer or lease
its properties and assets substantially as an entirety to any corporation or
other Person, except as described in this Section 2.15 and except with respect
to the distribution of Debentures to Holders of Securities pursuant to Section
7.1(a)(iv) of this Declaration or Section 4 of Annex I.

            (b) The Trust may, with the consent of the Administrators (which
consent will not be unreasonably withheld) and without the consent of the
Institutional Trustee, the Delaware Trustee or the Holders of the Capital
Securities, consolidate, amalgamate, merge with or into, or be replaced by, or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to a trust organized as such under the laws of any
state; provided, that:

                  (i) if the Trust is not the survivor, such successor entity
            (the "Successor Entity") either:

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

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

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

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

                                       22
<PAGE>

                  (iv) such merger, consolidation, amalgamation, replacement,
            conveyance, transfer or lease does not cause the rating on the
            Capital Securities or any Successor Securities to be downgraded or
            withdrawn by any nationally recognized statistical rating
            organization, if the Capital Securities are then rated;

                  (v) such merger, consolidation, amalgamation, replacement,
            conveyance, transfer or lease does not adversely affect the rights,
            preferences and privileges of the Holders of the Securities or any
            Successor Securities in any material respect (other than with
            respect to any dilution of such Holders' interests in the Successor
            Entity);

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

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

                        (A) such merger, consolidation, amalgamation,
                  replacement, conveyance, transfer or lease does not adversely
                  affect the rights, preferences and privileges of the Holders
                  of the Securities or any Successor Securities in any material
                  respect (other than with respect to any dilution of such
                  Holders' interests in the Successor Entity);

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

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

                  (viii) the Sponsor guarantees the obligations of the Successor
            Entity under the Successor Securities to the same extent provided by
            the Indenture, the Guarantee, the Debentures and this Declaration;
            and

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

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

                                       23
<PAGE>

merge with or into, or be replaced by, or convey, transfer or lease its
properties and assets as an entirety or substantially as an entirety to, any
other Person or permit any other Person to consolidate, amalgamate, merge with
or into, or replace it if such consolidation, amalgamation, merger, replacement,
conveyance, transfer or lease would cause the Trust or Successor Entity to be
classified as other than a grantor trust for United States federal income tax
purposes.

                                  ARTICLE III

                                    SPONSOR

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

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

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

            (b) to prepare for filing and request the Administrators to cause
the filing by the Trust, as may be appropriate, of an application to the PORTAL
system, for listing or quotation upon notice of issuance of any Capital
Securities, as requested by the Holders of not less than a Majority in
liquidation amount of the Capital Securities; and

            (c) to negotiate the terms of and/or execute and deliver on behalf
of the Trust, the Purchase Agreement and other related agreements providing for
the sale of the Capital Securities or the resale thereof by the Purchaser.

                                   ARTICLE IV

                           TRUSTEES AND ADMINISTRATORS

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

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

            (b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holder of a Majority in liquidation
amount of the Common Securities voting as a class at a meeting of the Holder of
the Common Securities;

                                       24
<PAGE>

provided, however, that there shall be a Delaware Trustee if required by Section
4.2; and there shall always be one Trustee who shall be the Institutional
Trustee, and such Trustee may also serve as Delaware Trustee if it meets the
applicable requirements, in which case Section 2.11 shall have no application to
such entity in its capacity as Institutional Trustee.

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

            (a) a natural person who is a resident of the State of Delaware and
a U.S. Person at least 21 years of age; or

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

            The initial Delaware Trustee shall be Wilmington Trust Company.

            Section 4.3. Institutional Trustee; Eligibility.

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

                  (i) not be an Affiliate of the Sponsor;

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

                  (iii) be a banking corporation or national association
            organized and doing business under the laws of the United States of
            America or any state thereof or of the District of Columbia and
            authorized under such laws to exercise corporate trust powers,
            having a combined capital and surplus of at least fifty million U.S.
            dollars ($50,000,000), and subject to supervision or examination by
            federal, state or District of Columbia authority. If such
            corporation or national association publishes reports of condition
            at least annually, pursuant to law or to the requirements of the
            supervising or examining authority referred to above, then for the
            purposes of this Section 4.3(a)(iii), the combined capital and
            surplus of such corporation or national association shall be deemed
            to be its combined capital and surplus as set forth in its most
            recent report of condition so published.

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

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

                                       25
<PAGE>

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

            Section 4.4. Administrators. Each Administrator shall be a U.S.
Person. There shall at all times be at least one Administrator. Except where a
requirement for action by a specific number of Administrators is expressly set
forth in this Declaration and except with respect to any action the taking of
which is the subject of a meeting of the Administrators, any action required or
permitted to be taken by the Administrators may be taken by, and any power of
the Administrators may be exercised by, or with the consent of, any one such
Administrator acting alone.

            Section 4.5. Appointment, Removal and Resignation of the Trustees
and the Administrators.

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

            (b) Subject to Section 4.5(a), a Relevant Trustee may resign at any
time by giving written notice thereof to the Holders of the Securities and by
appointing a successor Relevant Trustee. Upon the resignation of the
Institutional Trustee, the Institutional Trustee shall appoint a successor by
requesting from at least three Persons meeting the eligibility requirements
their expenses and charges to serve as the successor Institutional Trustee on a
form provided by the Administrators, and selecting the Person who agrees to the
lowest expense and charges (the "Successor Institutional Trustee"). If the
instrument of acceptance by the successor Relevant Trustee required by this
Section shall not have been delivered to the Relevant Trustee within 60 days
after the giving of such notice of resignation or delivery of the instrument of
removal, the Relevant Trustee may petition, at the expense of the Trust, any
federal, state or District of Columbia court of competent jurisdiction for the
appointment of a successor Relevant Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Relevant
Trustee. The Institutional Trustee shall have no liability for the selection of
such successor pursuant to this Section.

            (c) Unless an Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by an act of the Holders of a
Majority in liquidation amount of the Common Securities. If any Trustee shall be
so removed, the Holders of the Common Securities, by act of the Holders of a
Majority in liquidation amount of the Common Securities delivered to the
Relevant Trustee, shall promptly appoint a successor Relevant Trustee, and such
successor Relevant Trustee shall comply with the applicable requirements of this
Section. If an Event of Default shall have occurred and be continuing, the
Institutional Trustee or the Delaware Trustee, or both of them, may be removed
by the act of the Holders of a Majority in liquidation amount of the Capital
Securities, delivered to the Relevant Trustee (in its individual capacity and on
behalf of the Trust). If any Trustee shall be so removed, the Holders of Capital
Securities, by act of the Holders of a Majority in liquidation amount of the
Capital Securities then outstanding delivered to the Relevant Trustee, shall
promptly appoint a successor Relevant Trustee or Trustees, and such successor
Relevant Trustee shall comply with the applicable requirements of this Section.
If no successor Relevant Trustee shall have been so

                                       26
<PAGE>

appointed by the Holders of a Majority in liquidation amount of the Capital
Securities and accepted appointment in the manner required by this Section
within 30 days after delivery of an instrument of removal, the Relevant Trustee
or any Holder who has been a Holder of the Securities for at least six months
may, on behalf of himself and all others similarly situated, petition any
federal, state or District of Columbia court of competent jurisdiction for the
appointment of a successor Relevant Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a successor
Relevant Trustee or Trustees.

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

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

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

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

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

                                       27
<PAGE>

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

            Section 4.6. Vacancies Among Trustees. If a Trustee ceases to hold
office for any reason and the number of Trustees is not reduced pursuant to
Section 4.1, or if the number of Trustees is increased pursuant to Section 4.1,
a vacancy shall occur. A resolution certifying the existence of such vacancy by
the Trustees or, if there are more than two, a majority of the Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 4.5.

            Section 4.7. Effect of Vacancies. The death, resignation,
retirement, removal, bankruptcy, dissolution, liquidation, incompetence or
incapacity to perform the duties of a Trustee shall not operate to dissolve,
terminate or annul the Trust or terminate this Declaration. Whenever a vacancy
in the number of Trustees shall occur, until such vacancy is filled by the
appointment of a Trustee in accordance with Section 4.5, the Institutional
Trustee shall have all the powers granted to the Trustees and shall discharge
all the duties imposed upon the Trustees by this Declaration.

            Section 4.8. Meetings of the Trustees and the Administrators.
Meetings of the Trustees or the Administrators shall be held from time to time
upon the call of any Trustee or Administrator, as applicable. Regular meetings
of the Trustees and the Administrators, respectively, may be in person in the
United States or by telephone, at a place (if applicable) and time fixed by
resolution of the Trustees or the Administrators, as applicable. Notice of any
in-person meetings of the Trustees or the Administrators shall be hand delivered
or otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 48 hours before such meeting. Notice of any
telephonic meetings of the Trustees or the Administrators or any committee
thereof shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 24 hours before
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of a Trustee or an Administrator, as the case may be, at a meeting
shall constitute a waiver of notice of such meeting except where a Trustee or an
Administrator, as the case may be, attends a meeting for the express purpose of
objecting to the transaction of any activity on the ground that the meeting has
not been lawfully called or convened. Unless provided otherwise in this
Declaration, any action of the Trustees or the Administrators, as the case may
be, may be taken at a meeting by vote of a majority of the Trustees or the
Administrators present (whether in person or by telephone) and eligible to vote
with respect to such matter; provided, that, in the case of the Administrators,
a Quorum is present, or without a meeting by the unanimous written consent of
the Trustees or the Administrators, as the case may be. Meetings of the Trustees
and the Administrators together shall be held from time to time upon the call of
any Trustee or Administrator.

            Section 4.9. Delegation of Power. (a) Any Trustee or any
Administrator, as the case may be, may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 that is
a U.S. Person his or her power for the purpose of executing any documents,
instruments or other writings contemplated in Section 2.6.

                                       28
<PAGE>

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

            Section 4.10. Merger, Conversion, Consolidation or Succession to
Business. Any Person into which the Institutional Trustee or the Delaware
Trustee, as the case may be, may be merged or converted or with which either may
be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Institutional Trustee or the Delaware Trustee, as the
case may be, shall be a party, or any Person succeeding to all or substantially
all the corporate trust business of the Institutional Trustee or the Delaware
Trustee, as the case may be, shall be the successor of the Institutional Trustee
or the Delaware Trustee, as the case may be, hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided such Person shall be otherwise qualified and eligible under this
Article and, provided, further, that such Person shall file an amendment to the
Certificate of Trust with the Secretary of State of the State of Delaware as
contemplated in Section 4.5(i).

                                   ARTICLE V

                                 DISTRIBUTIONS

            Section 5.1. Distributions. Holders shall receive Distributions in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Capital Securities and the Common Securities
in accordance with the preferences set forth in their respective terms. If and
to the extent that the Debenture Issuer makes a payment of interest (including
any Additional Amounts or Deferred Interest) or premium, if any, on and/or
principal of 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 in the Property Account for that
purpose, to make a distribution (a "Distribution") of the Payment Amount to
Holders. For the avoidance of doubt, funds in the Property Account shall not be
distributed to Holders to the extent of any taxes payable by the Trust, in the
case of withholding taxes, as determined by the Institutional Trustee or any
Paying Agent and, in the case of taxes other than withholding taxes, as
determined by the Administrators in a written notice to the Institutional
Trustee.

                                   ARTICLE VI

                             ISSUANCE OF SECURITIES

            Section 6.1. General Provisions Regarding Securities.

            (a) The Administrators shall on behalf of the Trust issue one series
of capital securities, evidenced by a certificate substantially in the form of
Exhibit A-1, representing undivided beneficial interests in the assets of the
Trust and having such terms as are set forth in Annex I (the "Capital
Securities"), and one series of common securities, evidenced by a certificate
substantially in the form of Exhibit A-2, representing undivided beneficial
interests in

                                       29
<PAGE>

the assets of the Trust and having such terms as are set forth in Annex I (the
"Common Securities"). The Trust shall issue no securities or other interests in
the assets of the Trust other than the Capital Securities and the Common
Securities. The Capital Securities rank pari passu with, and payment thereon
shall be made Pro Rata with, the Common Securities except that, where an Event
of Default has occurred and is continuing, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon liquidation,
redemption and otherwise are subordinated to the rights to payment of the
Holders of the Capital Securities.

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

            (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, and each Holder thereof shall be entitled to the benefits
provided by this Declaration.

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

            Section 6.2. Paying Agent, Transfer Agent, Calculation Agent and
Registrar.

            (a) The Trust shall maintain in Wilmington, Delaware (i) an office
or agency where the Securities may be presented for payment (the "Paying Agent")
and (ii) an office or agency where Securities may be presented for registration
of transfer or exchange (the "Transfer Agent"). The Trust shall keep or cause to
be kept at such office or agency a register (the "Securities Register") for the
purpose of registering Securities and transfers and exchanges of Securities,
such Securities Register to be held by a registrar (the "Registrar"). The
Administrators may appoint the Paying Agent, the Registrar and the Transfer
Agent, and may

                                       30
<PAGE>

appoint one or more additional Paying Agents, one or more co-Registrars, or one
or more co-Transfer Agents in such other locations as it shall determine. The
term "Paying Agent" includes any additional Paying Agent, the term "Registrar"
includes any additional Registrar or co-Registrar and the term "Transfer Agent"
includes any additional Transfer Agent or co-Transfer Agent. The Administrators
may change any Paying Agent, Transfer Agent or Registrar at any time without
prior notice to any Holder. The Administrators shall notify the Institutional
Trustee of the name and address of any Paying Agent, Transfer Agent and
Registrar not a party to this Declaration. The Administrators hereby initially
appoint the Institutional Trustee to act as Paying Agent, Transfer Agent and
Registrar for the Capital Securities and the Common Securities at its Corporate
Trust Office. The Institutional Trustee or any of its Affiliates in the United
States may act as Paying Agent, Transfer Agent or Registrar.

            (b) The Trust shall also appoint a Calculation Agent, which shall
determine the Coupon Rate in accordance with the terms of the Securities. The
Trust initially appoints the Institutional Trustee as Calculation Agent.

            Section 6.3. Form and Dating.

            (a) The Capital Securities shall be evidenced by one or more
Certificates, and the Institutional Trustee's certificate of authentication
thereon shall be, substantially in the form of Exhibit A-1, and the Common
Securities shall be evidenced by one or more Certificates substantially in the
form of Exhibit A-2, each of which is hereby incorporated in and expressly made
a part of this Declaration. Certificates may be typed, printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Administrators, as conclusively evidenced by their execution thereof.
Certificates evidencing Securities may have letters, numbers, notations or other
marks of identification or designation and such legends or endorsements required
by law, stock exchange rule, agreements to which the Trust is subject, if any,
or usage (provided, that any such notation, legend or endorsement is in a form
acceptable to the Sponsor). The Trust at the direction of the Sponsor shall
furnish any such legend not contained in Exhibit A-1 to the Institutional
Trustee in writing. Each Capital Security Certificate shall be dated the date of
its authentication. The terms and provisions of the Securities set forth in
Annex I and the forms of Certificates set forth in Exhibits A-1 and A-2 are part
of the terms of this Declaration and to the extent applicable, the Institutional
Trustee, the Delaware Trustee, the Administrators and the Sponsor, by their
execution and delivery of this Declaration, expressly agree to such terms and
provisions and to be bound thereby. Capital Securities will be issued only in
blocks having an aggregate liquidation amount of not less than $100,000.

            (b) The Capital Securities are being offered and sold by the Trust
initially pursuant to the Purchase Agreement in definitive form, registered in
the name of the Holder thereof, without coupons and with the Restricted
Securities Legend.

            Section 6.4. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate should be surrendered to the Registrar, or if the
Registrar shall receive evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) the related Holder shall deliver to the
Registrar, the Administrators and the Institutional Trustee such security or
indemnity as may be reasonably required by them to keep each of them harmless,

                                       31
<PAGE>

then, in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, an Administrator on behalf of the Trust shall execute
(and in the case of a Capital Security Certificate, the Institutional Trustee
shall authenticate) and deliver to such Holder, 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, the Registrar or the Administrators may require such Holder to pay
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith. Any Certificate executed and delivered pursuant
to this Section shall constitute conclusive evidence of an ownership interest in
the relevant Securities, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time.

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

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

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

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

            (b) For so long as any Capital Securities remain outstanding, if,
upon an Indenture Event of Default pursuant to Sections 5.01(b), (e) or (f) of
the Indenture, the Debenture Trustee fails or the holders of not less than 25%
in principal amount of the outstanding Debentures fail to declare the principal
of all of the Debentures to be immediately

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<PAGE>

due and payable, the Holders of not less than a Majority in liquidation amount
of the Capital Securities then outstanding shall have the right to make such
declaration by a notice in writing to the Institutional Trustee, the Sponsor and
the Debenture Trustee.

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

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

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

                        (B) any accrued Deferred Interest on all of the
                  Debentures;

                        (C) all payments on any Debentures that have become due
                  otherwise than by such acceleration and interest and Deferred
                  Interest thereon at the rate borne by the Debentures; and

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

                  (ii) all Events of Default with respect to the Debentures,
            other than the non-payment of the principal of or premium, if any,
            on the Debentures that has become due solely by such acceleration,
            have been cured or waived as provided in Section 5.07 of the
            Indenture.

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

            (e) Upon receipt by the Institutional Trustee of written notice
declaring such an acceleration, or rescission and annulment thereof, by Holders
of any part of the Capital Securities, a record date shall be established for
determining Holders of outstanding Capital Securities entitled to join in such
notice, which record date shall be at the close of business on

                                       33
<PAGE>

the day the Institutional Trustee receives such notice. The Holders on such
record date, or their duly designated proxies, and only such Persons, shall be
entitled to join in such notice, whether or not such Holders remain Holders
after such record date; provided, that, unless such declaration of acceleration,
or rescission and annulment, as the case may be, shall have become effective by
virtue of the requisite percentage having joined in such notice prior to the day
that is 90 days after such record date, such notice of declaration of
acceleration, or rescission and annulment, as the case may be, shall
automatically and without further action by any Holder be canceled and of no
further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of
a Holder, from giving, after expiration of such 90-day period, a new written
notice of declaration of acceleration, or rescission and annulment thereof, as
the case may be, that is identical to a written notice that has been canceled
pursuant to the proviso to the preceding sentence, in which event a new record
date shall be established pursuant to the provisions of this Section.

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

                                  ARTICLE VII

                      DISSOLUTION AND TERMINATION OF TRUST

            Section 7.1. Dissolution and Termination of Trust. (a) The Trust
shall dissolve on the first to occur of :

                  (i) unless earlier dissolved, on February 23, 2040, the
            expiration of the term of the Trust;

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

                  (iii) other than in connection with a merger, consolidation or
            similar transaction not prohibited by the Indenture, this
            Declaration or the Guarantee, as the case may be, the filing of a
            certificate of dissolution or its equivalent with respect to the
            Sponsor or upon the revocation of the charter of the Sponsor and the
            expiration of 90 days after the date of revocation without a
            reinstatement thereof;

                  (iv) the distribution of all of the Debentures to the Holders
            of the Securities, upon exercise of the right of the Holders of all
            of the outstanding Common Securities to dissolve the Trust as
            provided in Annex I hereto;

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

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<PAGE>

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

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

            (b) As soon as is practicable after the occurrence of an event
referred to in Section 7.1(a), and after satisfaction of liabilities to
creditors of the Trust as required by applicable law, including Section 3808 of
the Statutory Trust Act, and subject to the terms set forth in Annex I, the
Institutional Trustee shall terminate the Trust by filing a certificate of
cancellation with the Secretary of State of the State of Delaware.

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

                                  ARTICLE VIII

                              TRANSFER OF INTERESTS

            Section 8.1. General. (a) Where a Holder of Capital Securities
delivers to the Registrar in accordance with this Declaration a request to
register a transfer of such Holder's Capital Securities or to exchange them for
an equal aggregate liquidation amount of Capital Securities represented by
different Certificates, the Registrar shall register the transfer or make the
exchange when the requirements specified in this Article VIII for such transfer
or exchange are met. To facilitate registrations of transfers and exchanges, the
Trust shall execute and the Institutional Trustee shall authenticate Capital
Security Certificates at the Registrar's request.

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

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

            (d) The Registrar shall provide in the Securities Register for the
registration of Securities and of transfers of Securities, which will be
effected without charge but only upon payment (with such indemnity as the
Registrar may reasonably require) in respect of any tax or other governmental
charges that may be imposed in relation to it. Upon its receipt of the

                                       35
<PAGE>

documents required under this Section 8.1(d) for registration of transfer of any
Securities, the Registrar shall register in the Securities Register, in the name
of the designated transferee or transferees, the Securities being transferred
and thereupon, for all purposes of this Declaration, such transfer shall be
effective and such transferee or transferees shall be, and such transferor shall
no longer be, the Holder of the transferred Securities. Upon the registration of
transfer of a Security pursuant to the terms of this Declaration in the name of
the new Holder thereof, such Security shall constitute the same Security as the
Security so transferred and shall be entitled to the same benefits under this
Declaration as the Security so transferred. The Registrar shall, and is
authorized to, record and register in the Securities Register the transfer of a
Security upon the Registrar's receipt of originals or copies (which may be by
facsimile or other form of electronic transmission) of (i) a written instrument
of transfer in form reasonably satisfactory to the Registrar duly executed by
the Holder or such Holder's attorney duly authorized in writing, and (ii) if
such Security is being transferred prior to the Resale Restriction Termination
Date other than in accordance with Section 8.4, a certificate substantially in
the form set forth as Exhibit B, C or D, as applicable, hereto, executed by the
transferor or transferee, as applicable; thereupon, the Registrar is authorized
to confirm in writing to the transferee and, if requested, to the transferor of
such Security that such transfer has been registered in the Securities Register
and that such transferee is the Holder of such Security. The Certificate
evidencing the Security so transferred, duly endorsed by the transferor, shall
be surrendered to the Registrar at the time the transfer conditions specified in
the immediately preceding sentence are satisfied or within five (5) Business
Days after the Registrar has registered the transfer of such Security on the
Securities Register, and promptly after such surrender, an Administrator on
behalf of the Trust shall execute and, in the case of a Capital Security
Certificate, the Institutional Trustee shall, and is authorized to, authenticate
a Certificate in the name of the transferee as the new Holder of the Security
evidenced thereby. Until the Certificate evidencing the Security so transferred
is surrendered to the Registrar, such Security may not be transferred by such
new Holder. Each Certificate surrendered in connection with a registration of
transfer shall be canceled by the Institutional Trustee pursuant to Section 6.6.
A transferee of a Security shall be entitled to the rights and subject to the
obligations of a Holder hereunder upon the registration of such transfer in the
Securities Register. Each such transferee shall be deemed to have agreed to be
bound by this Declaration.

            (e) Neither the Trust nor the Registrar shall be required (i) to
issue Certificates representing Securities or register the transfer of or
exchange any Securities during a period beginning at the opening of business 15
days before the day of any selection of Securities for redemption and ending at
the close of business on the earliest date on which the relevant notice of
redemption is deemed to have been given to all Holders of the Securities to be
redeemed, or (ii) to register the transfer or exchange of any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.

            Section 8.2. Transfer Procedures and Restrictions.

            (a) Prior to the Resale Restriction Termination Date, Certificates
evidencing Capital Securities shall bear the Restricted Securities Legend. The
Restricted Securities Legend on any Certificate evidencing outstanding Capital
Securities shall not be removed unless there is delivered to the Trust such
satisfactory evidence, which may include an opinion of counsel, as

                                       36
<PAGE>

may be reasonably required by the Trust, that neither the Restricted Securities
Legend nor the restrictions on transfer set forth therein are required to ensure
that transfers thereof comply with the provisions of the Securities Act or that
such Securities are not "restricted" within the meaning of Rule 144 under the
Securities Act. Upon provision of such satisfactory evidence, the Institutional
Trustee, at the written direction of the Trust, shall authenticate and deliver
Capital Securities Certificates that do not bear the Restricted Securities
Legend in exchange for the Capital Securities Certificates bearing the
Restricted Securities Legend.

            (b) Prior to the Resale Restriction Termination Date, without the
written consent of the Sponsor, Capital Securities may only be transferred: (i)
to a QIB if the instrument of transfer is accompanied by a certificate of the
transferor substantially in the form set forth as Exhibit C hereto; (ii) to an
"accredited investor" within the meaning of Rule 501(a) (1), (2), (3), (7) or
(8) under the Securities Act if the instrument of transfer is accompanied by a
certificate of the transferee substantially in the form set forth as Exhibit B
hereto; or (iii) to a non-"U.S. Person" in an "offshore transaction" under, and
within the meaning of, Regulation S under the Securities Act if the instrument
of transfer is accompanied by a certificate of the transferee substantially in
the form set forth as Exhibit D hereto. Each certificate furnished pursuant to
this Section 8.2(b) may be an original or a copy (which may be furnished by
facsimile or other form of electronic transmission).

            (c) The Capital Securities may not be transferred prior to the
Resale Restriction Termination Date except in compliance with restrictions on
transfer set forth in the legend set forth below (the "Restricted Securities
Legend"), and except as otherwise contemplated in Section 8.2(a), prior to the
Resale Restriction Termination Date, each Certificate evidencing outstanding
Capital Securities shall bear the Restricted Securities Legend:

            THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY OR ANY INTEREST
OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY
BE, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY OR ANY INTEREST OR
PARTICIPATION HEREIN PRIOR TO THE DATE WHICH IS THE LATER OF (i) TWO YEARS (OR
SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES
ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF AND (Z) THE
LAST DATE ON WHICH THE TRUST OR ANY AFFILIATE (AS DEFINED IN RULE 405 UNDER THE
SECURITIES ACT) OF THE TRUST WAS THE HOLDER OF THIS SECURITY OR SUCH INTEREST OR
PARTICIPATION (OR ANY PREDECESSOR THERETO) AND (ii) SUCH LATER DATE, IF ANY, AS
MAY BE REQUIRED BY ANY SUBSEQUENT CHANGE IN APPLICABLE LAW, ONLY (A) TO THE
DEBENTURE ISSUER OR THE TRUST, (B)

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<PAGE>

PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON THE
HOLDER REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER," AS DEFINED IN
RULE 144A, THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (C) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT TO AN "ACCREDITED INVESTOR" WITHIN THE
MEANING OF SUBPARAGRAPH (a) (1), (2), (3), (7) OR (8) OF RULE 501 UNDER THE
SECURITIES ACT THAT IS ACQUIRING THIS SECURITY OR SUCH INTEREST OR PARTICIPATION
FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN ACCREDITED INVESTOR, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (D) PURSUANT TO
OFFERS AND SALES TO NON-US PERSONS THAT OCCUR OUTSIDE THE UNITED STATES PURSUANT
TO REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE RIGHT OF THE DEBENTURE ISSUER AND THE TRUST PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER PURSUANT TO CLAUSE (C) OR (E) ABOVE TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM IN ACCORDANCE WITH THE AMENDED AND RESTATED DECLARATION OF TRUST, A COPY
OF WHICH MAY BE OBTAINED FROM THE DEBENTURE ISSUER OR THE TRUST. THE HOLDER OF
THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF
OR THEREOF, AS THE CASE MAY BE, AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.

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

                                       38
<PAGE>

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

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

            THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS
HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN
EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A
LIQUIDATION AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE
THE HOLDER OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN FOR ANY
PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
SECURITY OR SUCH INTEREST OR PARTICIPATION, AND SUCH PURPORTED TRANSFEREE SHALL
BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS SECURITY OR ANY INTEREST OR
PARTICIPATION HEREIN.

            (d) Capital Securities may only be transferred in minimum blocks of
$100,000 aggregate liquidation amount (100 Capital Securities) and multiples of
$1,000 in excess thereof. Any attempted transfer of Capital Securities in a
block having an aggregate liquidation amount of less than $100,000 shall be
deemed to be void and of no legal effect whatsoever. Any such purported
transferee shall be deemed not to be a Holder of such Capital Securities for any
purpose, including, but not limited to, the receipt of Distributions on such
Capital Securities, and such purported transferee shall be deemed to have no
interest whatsoever in such Capital Securities.

            Section 8.3. Deemed Security Holders. The Trust, the Administrators,
the Trustees, the Paying Agent, the Transfer Agent or the Registrar may treat
the Person in whose name any Security shall be registered on the Securities
Register of the Trust as the sole Holder and owner of such Security 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 Security on the part of any other Person, whether or not the
Trust, the Administrators, the Trustees, the Paying Agent, the Transfer Agent or
the Registrar shall have actual or other notice thereof.

                                       39
<PAGE>

            Section 8.4. Transfer of Initial Securities. Notwithstanding the
foregoing provisions of this Article VIII or any other provision of this
Declaration (including all Annexes and Exhibits hereto) to the contrary, any or
all of the Capital Securities initially issued to the Purchaser (the "Initial
Securities") may be transferred by the Purchaser to any transferee selected by
it that meets the parameters specified below and, upon delivery to the
Registrar, of originals or copies (which may be by facsimile or other form of
electronic transmission) of a written instrument of transfer in form reasonably
satisfactory to the Registrar duly executed by the Purchaser or the Purchaser's
attorney duly authorized in writing (it being understood that no signature
guarantee shall be required), then the Registrar shall, and is authorized to,
record and register on the Securities Register the transfer of such Initial
Securities to such transferee; thereupon, the Registrar is authorized to confirm
in writing to the transferee and, if requested, to the transferor of such
Initial Securities that such transfer has been registered in the Securities
Register and that such transferee is the Holder of such Initial Securities;
provided, however, that the Purchaser of the Initial Securities, by its
acceptance thereof, agrees that it may not transfer any Initial Securities prior
to the Resale Restriction Termination Date to any transferee that is not a QIB,
an "accredited investor" within the meaning of Rule 501(a)(1), (2), (3), (7) or
(8) under the Securities Act or a non-"U.S. Person" in an "offshore transaction"
under, and within the meaning of, Regulation S under the Securities Act. The
Certificate evidencing the Initial Securities to be transferred, duly endorsed
by the Purchaser, shall be surrendered to the Registrar at the time the transfer
conditions specified in the immediately preceding sentence are satisfied or
within five (5) Business Days after the Registrar has registered the transfer of
such Initial Securities in the Securities Register, and promptly after such
surrender, an Administrator on behalf of the Trust shall execute and, in the
case of a Capital Security Certificate, the Institutional Trustee shall, and is
authorized to, authenticate a Certificate in the name of the transferee as the
new Holder of the Initial Securities evidenced thereby. Until the Certificate
evidencing the Initial Securities so transferred is surrendered to the
Registrar, such Initial Securities may not be transferred by such new Holder. No
other conditions, restrictions or other provisions of this Declaration or any
other document shall apply to a transfer of Initial Securities by the Purchaser.

                                   ARTICLE IX

                           LIMITATION OF LIABILITY OF
                    HOLDERS OF SECURITIES, TRUSTEES OR OTHERS

            Section 9.1. Liability. (a) Except as expressly set forth in this
Declaration, the Guarantee and the terms of the Securities,the
Sponsor shall not be:

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

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

                                       40
<PAGE>

            (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 Statutory Trust Act, the
Holders of the 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, except as otherwise
specifically set forth herein.

            Section 9.2. Exculpation. (a) No Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Trust or any Covered
Person for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith on behalf of the
Trust and in a manner such Indemnified Person reasonably believed to be within
the scope of the authority conferred on such Indemnified Person by this
Declaration or by law, except that an Indemnified Person (other than an
Administrator) shall be liable for any such loss, damage or claim incurred by
reason of such Indemnified Person's negligence, willful misconduct or bad faith
with respect to such acts or omissions and except that an Administrator shall be
liable for any such loss, damage or claim incurred by reason of such
Administrator's gross negligence, willful misconduct or bad faith with respect
to such acts or omissions.

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

            Section 9.3. Fiduciary Duty. (a) To the extent that, at law or in
equity, an Indemnified Person has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or to any other Covered Person, an
Indemnified Person acting under this Declaration shall not be liable to the
Trust or to any other Covered Person for its good faith reliance on the
provisions of this Declaration. The provisions of this Declaration, to the
extent that they restrict the duties and liabilities of an Indemnified Person
otherwise existing at law or in equity (other than the duties imposed on the
Institutional Trustee under the Trust Indenture Act), are agreed by the parties
hereto to replace such other duties and liabilities of the Indemnified Person.

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

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

                                       41
<PAGE>

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

            Section 9.4. Indemnification. (a)

                  (i) The Sponsor shall indemnify, to the fullest extent
            permitted by law, any Indemnified Person who was or is a party or is
            threatened to be made a party to any threatened, pending or
            completed action, suit or proceeding, whether civil, criminal,
            administrative or investigative (other than an action by or in the
            right of the Trust) by reason of the fact that such Person is or was
            an Indemnified Person against expenses (including attorneys' fees
            and expenses), judgments, fines and amounts paid in settlement
            actually and reasonably incurred by such Person in connection with
            such action, suit or proceeding if such Person acted in good faith
            and in a manner such Person 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
            such conduct was unlawful. The termination of any action, suit or
            proceeding by judgment, order, settlement, conviction, or upon a
            plea of nolo contendere or its equivalent, shall not, of itself,
            create a presumption that the Indemnified Person did not act in good
            faith and in a manner which such Person 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 such conduct was unlawful.

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

                  (iii) To the extent that an Indemnified Person shall be
            successful on the merits or otherwise (including dismissal of an
            action without prejudice or the settlement of an action without
            admission of liability) in defense of any action, suit or proceeding
            referred to in paragraphs (i) and (ii) of this Section 9.4(a), or in
            defense of any claim, issue or matter therein, such Person shall be
            indemnified,

                                       42
<PAGE>

            the fullest extent permitted by law, against expenses (including
            attorneys' fees and expenses) actually and reasonably incurred by
            such Person in connection therewith.

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

                  (v) To the fullest extent permitted by law, expenses
            (including attorneys' fees and expenses) incurred by an Indemnified
            Person in defending a civil, criminal, administrative or
            investigative action, suit or proceeding referred to in paragraphs
            (i) and (ii) of this Section 9.4(a) shall be paid by the Sponsor in
            advance of the final disposition of such action, suit or proceeding
            upon receipt of an undertaking by or on behalf of such Indemnified
            Person to repay such amount if it shall ultimately be determined
            that such Person is not entitled to be indemnified by the Sponsor as
            authorized in this Section 9.4(a). Notwithstanding the foregoing, no
            advance shall be made by the Sponsor if a determination is
            reasonably and promptly made (1) in the case of a Company
            Indemnified Person (A) by the Administrators by a majority vote of a
            Quorum of disinterested Administrators, (B) if such a Quorum is not
            obtainable, or, even if obtainable, if a Quorum of disinterested
            Administrators so directs, by independent legal counsel in a written
            opinion or (C) by the Common Security Holder of the Trust, that,
            based upon the facts known to the Administrators, counsel or the
            Common Security Holder at the time such determination is made, such
            Indemnified Person acted in bad faith or in a manner that such
            Person either believed to be opposed to or did not believe to be in
            the best interests of the Trust, or, with respect to any criminal
            proceeding, that such Indemnified Person believed or had reasonable
            cause to believe such conduct was unlawful, or (2) in the case of a
            Fiduciary Indemnified Person, by independent legal counsel in a
            written opinion that, based upon the facts known to the counsel at
            the time such determination is made, such Indemnified Person acted
            in bad faith or in a manner that such Indemnified Person either
            believed to be opposed to or did not believe to be in the best
            interests of the Trust, or, with respect to any criminal proceeding,
            that such Indemnified Person believed or had reasonable cause to
            believe such conduct was unlawful. In no event shall any advance be
            made (i) to a Company Indemnified Person in instances where the
            Administrators, independent legal counsel or the Common Security
            Holder reasonably determine that such Person deliberately breached
            such Person's duty to the Trust or its Common or Capital Security
            Holders or (ii) to a Fiduciary Indemnified Person in instances where
            independent

                                       43
<PAGE>

            legal counsel promptly and reasonably determines in a written
            opinion that such Person deliberately breached such Person's duty to
            the Trust or its Common or Capital Security Holders.

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

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

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

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

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

                                       44
<PAGE>

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

            Section 9.5. Outside Businesses. Any Covered Person, the Sponsor,
the Delaware Trustee and the Institutional Trustee (subject to Section 4.3(c))
may engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Trust, and the Trust and the Holders of Securities shall have no rights
by virtue of this Declaration in and to such independent ventures or the income
or profits derived therefrom, and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or
improper. None of any Covered Person, the Sponsor, the Delaware Trustee or the
Institutional Trustee shall be obligated to present any particular investment or
other opportunity to the Trust even if such opportunity is of a character that,
if presented to the Trust, could be taken by the Trust, and any Covered Person,
the Sponsor, the Delaware Trustee and the Institutional Trustee shall have the
right to take for its own account (individually or as a partner or fiduciary) or
to recommend to others any such particular investment or other opportunity. Any
Covered Person, the Delaware Trustee and the Institutional Trustee may engage or
be interested in any financial or other transaction with the Sponsor or any
Affiliate of the Sponsor, or may act as depositary for, trustee or agent for, or
act on any committee or body of holders of, securities or other obligations of
the Sponsor or its Affiliates.

            Section 9.6. Compensation; Fee. (a) The Sponsor agrees:

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

                  (ii) except as otherwise expressly provided herein, to
            reimburse each of the Trustees upon request for all reasonable,
            documented expenses, disbursements and advances incurred or made by
            such Person in accordance with any provision of this Declaration
            (including the reasonable compensation and the expenses and
            disbursements of such Person's agents and counsel), except any such
            expense, disbursement or advance attributable to such Person's
            negligence, willful misconduct or bad faith.

            (b) The provisions of this Section shall survive the dissolution of
the Trust and the termination of this Declaration and the removal or resignation
of any Trustee.

                                       45
<PAGE>

                                   ARTICLE X

                                   ACCOUNTING

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

            Section 10.2. Certain Accounting Matters.

            (a) At all times during the existence of the Trust, the
Administrators shall keep, or cause to be kept, at the principal office of the
Trust in the United States, as defined for purposes of Treasury Regulations
Section 301.7701-7, full books of account, records and supporting documents,
which shall reflect in reasonable detail each transaction of the Trust. The
books of account shall be maintained on the accrual method of accounting, in
accordance with generally accepted accounting principles, consistently applied.

            (b) The Sponsor shall cause the Administrators to deliver, by
hardcopy or electronic transmission, to (i) each Holder of Securities each
Report on Form 10-K and Form 10-Q, if any, prepared by the Sponsor and filed
with the Commission in accordance with the Exchange Act, within 10 Business Days
after the filing thereof or (ii) if the Sponsor is (a) not then subject to
Section 13 or 15(d) of the Exchange Act (a "Private Entity") or (b) exempt from
reporting pursuant to Rule 12g3-2(b) thereunder, the information required by
Rule 144A(d)(4) under the Securities Act. Notwithstanding the foregoing, so long
as a Holder of the Capital Securities is the Purchaser or an entity that holds a
pool of trust preferred securities and/or debt securities as collateral for its
securities or a trustee thereof, and the Sponsor is (i) a Private Entity that,
on the date of original issuance of the Capital Securities, is required to
provide audited consolidated financial statements to its primary regulatory
authority, (ii) a Private Entity that, on the date of original issuance of the
Capital Securities, is not required to provide audited consolidated financial
statements to its primary regulatory authority, on the date of original issuance
of the Capital Securities but subsequently becomes subject to the audited
consolidated financial statement reporting requirements of that regulatory
authority or (iii) subject to Section 13 or 15(d) of the Exchange Act on the
date of original issuance of the Capital Securities or becomes so subject after
the date hereof but subsequently becomes a Private Entity, then, within 90 days
after the end of each fiscal year, beginning with the fiscal year in which the
Capital Securities were originally issued if the Sponsor was then subject to (x)
Section 13 or 15(d) of the Exchange Act or (y) audited consolidated financial
statement reporting requirements of its primary regulatory authority or,
otherwise, the earliest fiscal year in which the Sponsor becomes subject to (1)
Section 13 or 15(d) of the Exchange Act or (2) the audited consolidated
financial statement reporting requirements of its primary regulatory authority,
the Sponsor shall deliver, by hardcopy or electronic transmission, to each
Holder of Securities, unless otherwise provided pursuant to the preceding
sentence, (A) a copy of the Sponsor's audited consolidated financial statements
(including balance sheet and income statement) covering the related annual
period and (B) the report of the independent accountants with respect to such
financial statements. In addition to the foregoing, the Sponsor shall deliver to
each Holder 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 statements of income or

                                       46
<PAGE>

loss for the Fiscal Year then ended, that are prepared at the principal office
of the Trust in the United States, as defined for purposes of Treasury
Regulations Section 301.7701-7.

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

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

            (e) So long as a Holder of the Capital Securities is Sandler O'Neill
& Partners, L.P. or an entity that holds a pool of trust preferred securities
and/or debt securities or a trustee thereof, the Sponsor shall cause the
Administrators to deliver the Sponsor's reports on Form H-b(11) to such Holder
promptly following their filing with the OTS.

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

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

                                       47
<PAGE>

                                   ARTICLE XI

                             AMENDMENTS AND MEETINGS

            Section 11.1. Amendments. (a) Except as otherwise provided in this
Declaration or by any applicable terms of the Securities, this Declaration may
only be amended by a written instrument approved and executed by

                  (i) the Institutional Trustee,

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

                  (iii) if the amendment affects the rights, powers, duties,
            obligations or immunities of the Administrators, the Administrators,
            and

                  (iv) the Holders of a Majority in liquidation amount of the
            Common Securities.

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

                  (i) unless the Institutional Trustee shall have first received

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

                        (B) an opinion of counsel (who may be counsel to the
                  Sponsor or the Trust) that such amendment is permitted by, and
                  conforms to, the terms of this Declaration (including the
                  terms of the Securities) and that all conditions precedent to
                  the execution and delivery of such amendment have been
                  satisfied; or

                  (ii) if the result of such amendment would be to

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

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

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

                        (D) cause the Debenture Issuer to be unable to treat an
                  amount equal to the liquidation amount of the Capital
                  Securities as "Tier 1 Capital" or its then equivalent in the
                  guidelines or regulations issued by

                                       48
<PAGE>

                  the OTS; provided; that the Debenture Issuer shall have
                  become, or pursuant to law or regulation will become within
                  180 days, subject to capital requirements.

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

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

            (e) Sections 9.1(b) and 9.1(c) and this Section shall not be amended
without the consent of all of the Holders of the Securities.

            (f) The rights of the Holders of the Capital Securities and Common
Securities, as applicable, under Article IV to increase or decrease the number
of, and appoint and remove, Trustees shall not be amended without the consent of
the Holders of a Majority in liquidation amount of the Capital Securities or
Common Securities, as applicable.

            (g) This Declaration may be amended by the Institutional Trustee and
the Holder of the Common Securities without the consent of the Holders of the
Capital Securities to:

                  (i) cure any ambiguity;

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

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

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

                                       49
<PAGE>

provided, however, that no such amendment contemplated in clause (i), (ii),
(iii) or (iv) shall adversely affect the powers, preferences, rights or
interests of Holders of Capital Securities.

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

            (a) Meetings of the Holders of the Capital Securities or the Common
Securities may be called at any time by the Administrators (or as provided in
the terms of such Securities) to consider and act on any matter on which Holders
of such Securities are entitled to act under the terms of this Declaration, the
terms of such Securities or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading, if any. The Administrators shall
call a meeting of the Holders of such Securities if directed to do so by the
Holders of not less than 10% in liquidation amount of such Securities. Such
direction shall be given by delivering to the Administrators one or more notices
in a writing stating that the signing Holders of such 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 Certificates held by the Holders of the Securities exercising the
right to call a meeting and only those Securities represented by such
Certificates shall be counted for purposes of determining whether the required
percentage set forth in the second sentence of this paragraph has been met.

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

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

                  (ii) Each Holder of a Security may authorize any Person to act
            for it by proxy on all matters in which a Holder of Securities is
            entitled to participate, including waiving notice of any meeting, or
            voting or participating at a meeting. No proxy shall be valid after
            the expiration of 11 months from the date thereof unless otherwise
            provided in the proxy. Every proxy shall be revocable at the

                                       50
<PAGE>

            pleasure of the Holder of the Securities executing it. Except as
            otherwise provided herein, all matters relating to the giving,
            voting or validity of proxies shall be governed by the General
            Corporation Law of the State of Delaware relating to proxies, and
            judicial interpretations thereunder, as if the Trust were a Delaware
            corporation and the Holders of the Securities were stockholders of a
            Delaware corporation. Each meeting of the Holders of the Securities
            shall be conducted by the Administrators or by such other Person
            that the Administrators may designate.

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

                                  ARTICLE XII

                    REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
                              AND DELAWARE TRUSTEE

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

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

            (b) the Institutional Trustee has a combined capital and surplus of
at least fifty million U.S. dollars ($50,000,000);

            (c) the Institutional Trustee is not an Affiliate of the Sponsor,
nor does the Institutional Trustee offer or provide credit or credit enhancement
to the Trust;

            (d) the execution, delivery and performance by the Institutional
Trustee of this Declaration has been duly authorized by all necessary action on
the part of the Institutional Trustee, and this Declaration has been duly
executed and delivered by the Institutional Trustee,

                                       51
<PAGE>

and under Delaware law (excluding any securities laws) 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 considered in a proceeding in
equity or at law);

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

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

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

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

            (b) if it is not a natural person, the execution, delivery and
performance by the Delaware Trustee of this Declaration has been duly authorized
by all necessary corporate action on the part of the Delaware Trustee, and this
Declaration has been duly executed and delivered by the Delaware Trustee, and
under Delaware law (excluding any securities laws) constitutes a legal, valid
and binding obligation of the Delaware Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the court
(regardless of whether considered in a proceeding in equity or at law);

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

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

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

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

                                       52
<PAGE>

the State of Delaware and, in either case, a Person that satisfies for the Trust
the requirements of Section 3807 of the Statutory Trust Act.

                                  ARTICLE XIII
                                  MISCELLANEOUS

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

            (a) if given to the Trust, in care of the Administrators at the
Trust's mailing address set forth below (or such other address as the Trust may
give notice of to the Holders of the Securities): BofI Trust I, c/o BofI
Holding, Inc., 12220 El Camino Real, Suite 220, San Diego, California, 92130,
Attention: Andrew J. Micheletti, Telecopy: (858) 350-6211, Telephone: (858)
350-6200;

            (b) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as the Delaware Trustee may give notice of to
the Holders of the Securities): Wilmington Trust Company, Rodney Square North,
1100 North Market Street, Wilmington, DE 19890-0001, Attention: Corporate
Capital Markets, Telecopy: 302-636-4140, Telephone: 302-651-1000;

            (c) if given to the Institutional Trustee, at the Institutional
Trustee's mailing address set forth below (or such other address as the
Institutional Trustee may give notice of to the Holders of the Securities):
Wilmington Trust Company, Rodney Square North, 1100 North Market Street,
Wilmington, DE 19890-0001, Attention: Corporate Capital Markets, Telecopy:
302-636-4140, Telephone: 302-651-1000;

            (d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holder of
the Common Securities may give notice of to the Trust): BofI Holding, Inc.,
12220 El Camino Real, Suite 220, San Diego, California, 92130, Attention: Andrew
J. Micheletti, Telecopy: (858) 350-6211, Telephone: (858) 350-6200; or

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

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

            Section 13.2. Governing Law. This Declaration and the rights and
obligations of the parties hereunder shall be governed by and interpreted in
accordance with the law of the State of Delaware and all rights, obligations and
remedies shall be governed by such laws

                                       53
<PAGE>

without regard to the principles of conflict of laws of the State of Delaware or
any other jurisdiction that would call for the application of the law of any
jurisdiction other than the State of Delaware.

            Section 13.3. Submission to Jurisdiction.

            (a) Each of the parties hereto agrees that any suit, action or
proceeding arising out of or based upon this Declaration, or the transactions
contemplated hereby, may be instituted in any of the courts of the State of New
York and the United States District Courts, in each case located in the Borough
of Manhattan, City and State of New York, and further agrees to submit to the
jurisdiction of any competent court in the place of its corporate domicile in
respect of actions brought against it as a defendant. In addition, each such
party irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of such suit,
action or proceeding brought in any such court and irrevocably waives any claim
that any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum and irrevocably waives any right to which it
may be entitled on account of its place of corporate domicile. Each such party
hereby irrevocably waives any and all right to trial by jury in any legal
proceeding arising out of or relating to this Declaration or the transactions
contemplated hereby. Each such party agrees that final judgment in any
proceedings brought in such a court shall be conclusive and binding upon it and
may be enforced in any court to the jurisdiction of which it is subject by a
suit upon such judgment.

            (b) Each of the Sponsor, the Trustees, the Administrators and the
Holder of the Common Securities irrevocably consents to the service of process
on it in any such suit, action or proceeding by the mailing thereof by
registered or certified mail, postage prepaid, to it at its address given in or
pursuant to Section 13.1 hereof.

            (c) To the extent permitted by law, nothing herein contained shall
preclude any party from effecting service of process in any lawful manner or
from bringing any suit, action or proceeding in respect of this Declaration in
any other state, country or place.

            Section 13.4. Intention of the Parties. It is the intention of the
parties hereto that the Trust be classified for United States federal income tax
purposes as a grantor trust. The provisions of this Declaration shall be
interpreted to further this intention of the parties.

            Section 13.5. Headings. Headings contained in this Declaration are
inserted for convenience of reference only and do not affect the interpretation
of this Declaration or any provision hereof.

            Section 13.6. Successors and Assigns. Whenever in this Declaration
any of the parties hereto is named or referred to, the successors and assigns of
such party shall be deemed to be included, and all covenants and agreements in
this Declaration by the Sponsor and the Trustees shall bind and inure to the
benefit of their respective successors and assigns, whether or not so expressed.

                                       54
<PAGE>

            Section 13.7. Partial Enforceability. If any provision of this
Declaration, or the application of such provision to any Person or circumstance,
shall be held invalid, the remainder of this Declaration, or the application of
such provision to persons or circumstances other than those to which it is held
invalid, shall not be affected thereby.

            Section 13.8. Counterparts. This Declaration may contain more than
one counterpart of the signature page and this Declaration may be executed by
the affixing of the signature of each of the Trustees and Administrators to any
of such counterpart signature pages. All of such counterpart signature pages
shall be read as though one, and they shall have the same force and effect as
though all of the signers had signed a single signature page.

                                       55
<PAGE>

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

                                   WILMINGTON TRUST COMPANY,
                                       as Delaware Trustee

                                   By: /s/ Denise M. Geran
                                       ---------------------------------------
                                       Name: Denise M. Geran
                                       Title: Vice President

                                   WILMINGTON TRUST COMPANY,
                                       as Institutional Trustee

                                   By: /s/ Denise M. Geran
                                       ---------------------------------------
                                       Name: Denise M. Geran
                                       Title: Vice President

                                   BOFI HOLDING, INC.
                                       as Sponsor

                                   By: /s/ Gary Lewis Evan
                                       ---------------------------------------
                                       Name: Gary Lewis Evans
                                       Title: President & CEO

                                   /s/ Gary Lewis Evans
                                   -------------------------------------------
                                   Gary Lewis Evans
                                     as Administrator

                                   /s/ Andrew J. Micheletti
                                   -------------------------------------------
                                   Andrew J. Micheletti
                                     as Administrator

                                   /s/ Michelle Paulus
                                   -------------------------------------------
                                   Michelle Paulus
                                     as Administrator

                                       56
<PAGE>

                                     ANNEX I

                                    TERMS OF
                    CAPITAL SECURITIES AND COMMON SECURITIES

            Pursuant to Section 6.1 of the Amended and Restated Declaration of
Trust, dated as of December 16, 2004 (as amended from time to time, the
"Declaration"), the designation, rights, privileges, restrictions, preferences
and other terms and provisions of the Capital Securities and the Common
Securities (collectively, the "Securities") are set out below (each capitalized
term used but not defined herein has the meaning set forth in the Declaration):

            1. Designation and Number.

            (a) Capital Securities. 5,000 Capital Securities of BofI Trust I
(the "Trust"), with an aggregate liquidation amount with respect to the assets
of the Trust of FIVE MILLION Dollars ($5,000,000) and a liquidation amount with
respect to the assets of the Trust of $1,000 per Capital Security, are hereby
designated for the purposes of identification only as the "MMCapS(SM)" (the
"Capital Securities"). The Capital Security Certificates evidencing the Capital
Securities shall be substantially in the form of Exhibit A-1 to the Declaration,
with such changes and additions thereto or deletions therefrom as may be
required by ordinary usage, custom or practice or to conform to the rules of any
stock exchange on which the Capital Securities are listed, if any.

            (b) Common Securities. 155 Common Securities of the Trust (the
"Common Securities") will be evidenced by Common Security Certificates
substantially in the form of Exhibit A-2 to the Declaration, with such changes
and additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice. In the absence of an Event of Default, the Common
Securities will have an aggregate liquidation amount with respect to the assets
of the Trust of ONE HUNDRED FIFTY-FIVE THOUSAND Dollars ($155,000) and a
liquidation amount with respect to the assets of the Trust of $1,000 per Common
Security.

            2. Distributions. (a) Distributions payable on each Security will be
payable at a rate of interest per annum, which, with respect to any Distribution
Period (as defined herein), will be equal to LIBOR, as determined on the LIBOR
Determination Date for such Distribution Period (or, in the case of the first
Distribution Period, will be 2.50%), plus 2.40% (the "Coupon Rate"); provided,
however, that the Coupon Rate for any Distribution Period may not exceed the
Interest Rate (as defined in the Indenture) for the related Interest Period (as
defined in the Indenture). Distributions in arrears for more than one
Distribution Period will bear interest thereon, compounded quarterly, at the
applicable Coupon Rate for each Distribution Period thereafter (to the extent
permitted by applicable law). The term "Distributions", as used herein, includes
cash Distributions, any such compounded Distributions and any Additional Amounts
payable on the Debentures unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held by
the Institutional Trustee and to the extent the Institutional Trustee has funds
legally available in the Property Account therefor. The amount of Distributions
payable for any Distribution Period will be computed on the basis of a 360-day
year and the actual number of days elapsed in such Distribution Period.

                                     A-I-1
<PAGE>

            The term "Distribution Period", as used herein, means (i) in the
case of the first Distribution Period, the period from, and including, the date
of original issuance of the Securities to, but excluding, the initial
Distribution Payment Date and (ii) thereafter, from, and including, the first
day following the end of the preceding Distribution Period to, but excluding,
the applicable Distribution Payment Date or, in the case of the last
Distribution Period, the related date of redemption.

            (b) LIBOR shall be determined by the Calculation Agent for each
Distribution Period (other than the first Distribution Period, in which case
LIBOR will be 2.50% per annum) in accordance with the following provisions:

                  (1) On the second LIBOR Business Day (provided, that on such
            day commercial banks are open for business (including dealings in
            foreign currency deposits) in London (a "LIBOR Banking Day"), and
            otherwise the next preceding LIBOR Business Day that is also a LIBOR
            Banking Day) prior to the Distribution Payment Date that commences
            such Distribution Period (each such day, a "LIBOR Determination
            Date"), LIBOR shall equal the rate, as obtained by the Calculation
            Agent, for three-month U.S. Dollar deposits in Europe, which appears
            on Telerate (as defined in the International Swaps and Derivatives
            Association, Inc. 2000 Interest Rate and Currency Exchange
            Definitions) page 3750 or such other page as may replace such page
            3750, as of 11:00 a.m. (London time) on such LIBOR Determination
            Date, as reported by Bloomberg Financial Markets Commodities News or
            any successor service ("Telerate Page 3750"). "LIBOR Business Day"
            means any day that is not a Saturday, Sunday or other day on which
            commercial banking institutions in The City of New York or
            Wilmington, Delaware are authorized or obligated by law or executive
            order to be closed. If such rate is superseded on Telerate Page 3750
            by a corrected rate before 12:00 noon (London time) on such LIBOR
            Determination Date, the corrected rate as so substituted will be
            LIBOR for such LIBOR Determination Date.

                  (2) If, on such LIBOR Determination Date, such rate does not
            appear on Telerate Page 3750, the Calculation Agent shall determine
            the arithmetic mean of the offered quotations of the Reference Banks
            (as defined below) to leading banks in the London interbank market
            for three-month U.S. Dollar deposits in Europe (in an amount
            determined by the Calculation Agent) by reference to requests for
            quotations as of approximately 11:00 a.m. (London time) on such
            LIBOR Determination Date made by the Calculation Agent to the
            Reference Banks. If, on such LIBOR Determination Date, at least two
            of the Reference Banks provide such quotations, LIBOR shall equal
            the arithmetic mean of such quotations. If, on such LIBOR
            Determination Date, only one or none of the Reference Banks provide
            such a quotation, LIBOR shall be deemed to be the arithmetic mean of
            the offered quotations that at least two leading banks in The City
            of New York (as selected by the Calculation Agent) are quoting on
            such LIBOR Determination Date for three-month U.S. Dollar deposits
            in Europe at approximately 11:00 a.m. (London time) (in an amount
            determined by the

                                     A-I-2
<PAGE>

            Calculation Agent). As used herein, "Reference Banks" means four
            major banks in the London interbank market selected by the
            Calculation Agent.

                  (3) If the Calculation Agent is required but is unable to
            determine a rate in accordance with at least one of the procedures
            provided above, LIBOR for such Distribution Period shall be LIBOR in
            effect for the immediately preceding Distribution Period.

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

            (d) On each LIBOR Determination Date, the Calculation Agent shall
notify, in writing, the Sponsor and the Paying Agent of the applicable Coupon
Rate that applies to the related Distribution Period. The Calculation Agent
shall, upon the request of a Holder of any Securities, inform such Holder of the
Coupon Rate that applies to the related Distribution Period. All calculations
made by the Calculation Agent in the absence of manifest error shall be
conclusive for all purposes and binding on the Sponsor and the Holders of the
Securities. The Paying Agent shall be entitled to rely on information received
from the Calculation Agent or the Sponsor as to the applicable Coupon Rate. The
Sponsor shall, from time to time, provide any necessary information to the
Paying Agent relating to any original issue discount and interest on the
Securities that is included in any payment and reportable for taxable income
calculation purposes.

            (e) Distributions on the Securities will be cumulative, will accrue
from the date of original issuance, and will be payable, subject to extension of
Distribution Periods as described herein, quarterly in arrears on February 23,
May 23, August 23 and November 23 of each year, commencing on February 23, 2005
(each, a "Distribution Payment Date"), and on any earlier date of redemption, as
applicable. The Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures by extending the interest payment period
for up to 20 consecutive quarterly periods (each such extended interest payment
period, together with all previous and future consecutive extensions thereof, is
referred to herein as an "Extension Period") at any time and from time to time
on the Debentures, subject to the conditions described below and in the
Indenture. No Extension Period may end on a date other than a Distribution
Payment Date or extend beyond the Maturity Date, any Optional Redemption Date or
the Special Redemption Date, as the case may be (each such term as defined
herein). During any Extension Period, interest will continue to accrue on the
Debentures, and interest on such accrued interest (such accrued interest and
interest thereon referred to herein as "Deferred Interest") will accrue, at an
annual rate equal to the Coupon Rate applicable during such Extension Period,
compounded quarterly from the date such Deferred Interest would have been
payable were it not for the Extension Period, to the extent permitted by
applicable law. At the end of any Extension Period, the Debenture Issuer shall
pay all Deferred Interest then accrued and unpaid on the Debentures; provided,
however, that during any Extension Period, the Debenture Issuer may not (i)
declare or pay any dividends or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, any of the Debenture Issuer's
capital stock, (ii) make any

                                     A-I-3
<PAGE>

payment of principal or premium or interest on or repay, repurchase or
redeem any debt securities of the Debenture Issuer that rank in all respects
pari passu with or junior in interest to the Debentures or (iii) make any
payment under any guarantees of the Debenture Issuer that rank in all respects
pari passu with or junior in interest to the Guarantee (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of the
Debenture Issuer (A) in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, (B) in connection with a dividend
reinvestment or stockholder stock purchase plan or (C) in connection with the
issuance of capital stock of the Debenture Issuer (or securities convertible
into or exercisable for such capital stock), as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of any exchange or conversion of any class or series of the Debenture
Issuer's capital stock (or any capital stock of a subsidiary of the Debenture
Issuer) for any class or series of the Debenture Issuer's capital stock or of
any class or series of the Debenture Issuer's indebtedness for any class or
series of the Debenture Issuer's capital stock, (c) the purchase of fractional
interests in shares of the Debenture Issuer's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged, (d) any declaration of a dividend in connection with any
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior in interest to such
stock). Prior to the termination of any Extension Period, the Debenture Issuer
may further extend such Extension Period, provided, that no Extension Period
(including all previous and further consecutive extensions that are part of such
Extension Period) shall exceed 20 consecutive quarterly periods. Upon the
termination of any Extension Period and upon the payment of all Deferred
Interest, the Debenture Issuer may commence a new Extension Period, subject to
the requirements herein and in the Indenture. No interest or Deferred Interest
(except any Additional Amounts that may be due and payable) shall be due and
payable during an Extension Period, except at the end thereof, but Deferred
Interest shall accrue upon each installment of interest that would otherwise
have been due and payable during such Extension Period until such installment is
paid.

            As a consequence of any Extension Period, Distributions will be
deferred. Notwithstanding any such deferral, Distributions will continue to
accrue on the Securities, and Distributions on such accrued Distributions will
accrue, at the Coupon Rate applicable during such Extension Period, compounded
quarterly, to the extent permitted by applicable law. If Distributions are
deferred, the Distributions due shall be paid on the date that such Extension
Period terminates to Holders of the Securities as they appear on the books and
records of the Trust on the regular record date immediately preceding the
Distribution Payment Date on which such Extension Period terminates to the
extent that the Trust has funds legally available for the payment of such
Distributions in the Property Account of the Trust.

            The Trust's funds available for Distributions to the Holders of the
Securities will be limited to payments received from the Debenture Issuer. The
payment of Distributions out of moneys held by the Trust is guaranteed by the
Guarantor pursuant to the Guarantee.

                                     A-I-4
<PAGE>

            (f) Distributions on the Securities on any Distribution Payment Date
will be payable to the Holders thereof as they appear on the books and records
of the Registrar on the relevant regular record dates. The relevant "regular
record dates" shall be 15 days before the relevant Distribution Payment Dates.
Distributions payable on any Securities that are not punctually paid on any
Distribution Payment Date, as a result of the Debenture Issuer having failed to
make a payment under the Debentures, as the case may be, when due (taking into
account any Extension Period), will cease to be payable to the Person in whose
name such Securities are registered on the original relevant regular record
date, and such defaulted Distributions will instead be payable to the Person in
whose name such Securities are registered on the regular record date preceding
the Distribution Payment Date on which the related Extension Period terminates
or, in the absence of an Extension Period, a special record date therefor
selected by the Administrators.

            (g) 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.

            (h) If any Distribution Payment Date other than any date of
redemption falls on a day that is not a Business Day, then Distributions payable
will be paid on, and such Distribution Payment Date will be moved to, the next
succeeding Business Day, and additional Distributions will accrue for each day
that such payment is delayed as a result thereof.

            3. Liquidation Distribution Upon Dissolution. In the event of the
voluntary or involuntary liquidation, dissolution, winding-up or termination of
the Trust (each, a "Liquidation"), the Holders of the Securities will be
entitled to receive out of the assets of the Trust legally available for
distribution to Holders of the Securities, after satisfaction of liabilities to
creditors of the Trust (to the extent not satisfied by the Debenture Issuer), an
amount in cash equal to the aggregate of the liquidation amount of $1,000 per
Security plus unpaid Distributions accrued thereon to the date of payment
(collectively, the "Liquidation Distribution"), unless: (i) the Debentures have
been redeemed in full in accordance with the terms thereof and of the Indenture;
or (ii) the Debentures in an aggregate principal amount equal to the aggregate
liquidation amount of such Securities and bearing accrued and unpaid interest in
an amount equal to the accrued and unpaid Distributions on such Securities,
after paying or making reasonable provision to pay all claims and obligations of
the Trust in accordance with Section 3808(e) of the Statutory Trust Act, shall
be distributed on a Pro Rata basis to the Holders of the Securities in exchange
for such Securities.

            The Sponsor, as the Holder of all of the Common Securities, has the
right at any time, upon receipt by the Debenture Issuer and the Institutional
Trustee for the benefit of the Trust of (i) an opinion of nationally recognized
tax counsel that Holders will not recognize any gain or loss for United States
Federal income tax purposes as a result of the distribution of Debentures, to
dissolve the Trust (including, without limitation, upon the occurrence of a Tax
Event, an Investment Company Event or a Capital Treatment Event, each as defined
herein) and (ii) prior approval from the Office of Thrift Supervision (the
"OTS") (if then required under applicable capital guidelines or policies of the
OTS) and, after satisfaction of liabilities to creditors of the Trust, cause the
Debentures to be distributed to the Holders of the Securities on a Pro Rata
basis in accordance with the aggregate liquidation amount thereof.

                                     A-I-5
<PAGE>

            The Trust shall dissolve on the first to occur of (i) February 23,
2040, the expiration of the term of the Trust, (ii) a Bankruptcy Event with
respect to the Sponsor, the Trust or the Debenture Issuer, (iii) (other than in
connection with a merger, consolidation or similar transaction not prohibited by
the Indenture, this Declaration or the Guarantee, as the case may be) the filing
of a certificate of dissolution or its equivalent with respect to the Sponsor or
upon the revocation of the charter of the Sponsor and the expiration of 90 days
after the date of revocation without a reinstatement thereof, (iv) the
distribution of all of the Debentures to the Holders of the Securities, upon
exercise of the right of the Holders of all of the outstanding Common Securities
to dissolve the Trust as described above, (v) the entry of a decree of a
judicial dissolution of any Holder of the Common Securities, the Sponsor, the
Trust or the Debenture Issuer, (vi) when all of the Securities are then subject
to redemption and the amounts necessary for redemption thereof shall have been
paid to the Holders in accordance with the terms of the Securities or (vii)
before the issuance of any Securities, with the consent of all of the Trustees
and the Sponsor. As soon as practicable after the dissolution of the Trust and
upon completion of the winding up of the Trust, the Trust shall terminate upon
the filing of a certificate of cancellation with the Secretary of State of the
State of Delaware.

            Notwithstanding the foregoing, if a Liquidation of the Trust occurs
as described in clause (i), (ii), (iii) or (v) in the immediately preceding
paragraph, the Trust shall be liquidated by the Institutional Trustee of the
Trust as expeditiously as such Trustee determines to be practical by
distributing, after satisfaction of liabilities to creditors of the Trust (to
the extent not satisfied by the Debenture Issuer) as provided by applicable law,
to the Holders of the Securities, the Debentures on a Pro Rata basis, unless
such distribution is determined by the Institutional Trustee not to be
practical, in which event such Holders will be entitled to receive on a Pro Rata
basis, out of the assets of the Trust legally available for distribution to the
Holders of the Securities, after satisfaction of liabilities to creditors of the
Trust (to the extent not satisfied by the Debenture Issuer), an amount in cash
equal to the Liquidation Distribution. A Liquidation of the Trust pursuant to
clause (iv) of the immediately preceding paragraph shall occur if the
Institutional Trustee determines that such Liquidation is practical by
distributing, after satisfaction of liabilities to creditors of the Trust (to
the extent not satisfied by the Debenture Issuer), to the Holders of the
Securities on a Pro Rata basis, the Debentures, and such distribution occurs.

            If, upon any Liquidation of the Trust, 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 to the Holders of the
Securities on a Pro Rata basis, except that if an Event of Default has occurred
and is continuing, then the Capital Securities shall have a preference over the
Common Securities with regard to such amounts.

            Upon any Liquidation of the Trust involving a distribution of the
Debentures, if at the time of such Liquidation, the Capital Securities were
rated by at least one nationally-recognized statistical rating organization, the
Debenture Issuer will use its reasonable best efforts to obtain from at least
one such or other rating organization a rating for the Debentures.

            After the date for any distribution of the Debentures upon any
Liquidation of the Trust, (i) the Securities of the Trust will be deemed to be
no longer outstanding, (ii) any

                                     A-I-6
<PAGE>

certificates representing the Capital Securities will be deemed to represent
undivided beneficial interests in such of the Debentures as have an aggregate
principal amount equal to the aggregate liquidation amount of such Capital
Securities and bearing accrued and unpaid interest equal to accrued and unpaid
Distributions on such Capital Securities until such certificates are presented
to the Debenture Issuer or its agent for transfer or reissuance (and until such
certificates are so surrendered, no payments shall be made to Holders of
Securities in respect of any payments due and payable under the Debentures) and
(iii) all rights of Holders of Securities shall cease, except the right of such
Holders to receive Debentures upon surrender of certificates representing such
Securities.

            4. Redemption and Distribution.

            (a) The Debentures will mature on February 23, 2035 (the "Maturity
Date") at an amount in cash equal to 100% of the principal amount thereof plus
unpaid interest accrued thereon to such date (the "Maturity Redemption Price").
The Debentures may be redeemed by the Debenture Issuer, at its option, in whole
or in part, on any Distribution Payment Date on or after February 23, 2010
(each, an "Optional Redemption Date"), at the Optional Redemption Price, upon
not less than 30 nor more than 60 days' prior written notice to holders of such
Debentures. In addition, upon the occurrence and continuation of a Tax Event, an
Investment Company Event or a Capital Treatment Event, the Debentures may be
redeemed by the Debenture Issuer, at its option, in whole but not in part, at
any time within 90 days following the occurrence of such Tax Event, Investment
Company Event or Capital Treatment Event, as the case may be (the "Special
Redemption Date"), at the Special Redemption Price, upon not less than 30 nor
more than 60 days' prior written notice to holders of the Debentures so long as
such Tax Event, Investment Company Event or Capital Treatment Event, as the case
may be, is continuing. In each case, the right of the Debenture Issuer to redeem
the Debentures prior to maturity is subject to the Debenture Issuer and the
Trust having received prior approval from the OTS, if then required under
applicable capital guidelines or policies of the OTS.

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

                                     A-I-7
<PAGE>

States federal income tax purposes; or (iii) the Trust is, or will be within 90
days of the date of such opinion, subject to or otherwise required to pay, or
required to withhold from Distributions, more than a de minimis amount of other
taxes (including withholding taxes), duties, assessments or other governmental
charges.

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

            "Capital Treatment Event" means, if the Debenture Issuer is
organized and existing under the laws of the United States or any state thereof
or the District of Columbia, the receipt by the Debenture Issuer and the Trust
of an opinion of counsel experienced in such matters to the effect that, as a
result of (a) any amendment to, or change in, the laws, rules or regulations of
the United States or any political subdivision thereof or therein, or any rules,
guidelines or policies of an applicable regulatory authority for the Debenture
Issuer or (b) any official or administrative pronouncement or action or decision
interpreting or applying such laws, rules or regulations, which amendment or
change is effective or which pronouncement, action or decision is announced on
or after the date of original issuance of the Debentures, there is more than an
insubstantial risk that the Debenture Issuer will not, within 90 days of the
date of such opinion, be entitled to treat an amount equal to the aggregate
liquidation amount of the Capital Securities as "Tier 1 Capital" (or its then
equivalent) if the Debenture Issuer (or its successors) were subject to such
capital requirement, applied as if the Debenture Issuer (or its successor) were
a bank holding company for purposes of the capital adequacy guidelines of the
Federal Reserve (or any successor regulatory authority with jurisdiction over
bank holding companies), or any capital adequacy guidelines as then in effect
and applicable to the Debenture Issuer; provided, however, that the inability of
the Debenture Issuer to treat all or any portion of the aggregate liquidation
amount of the Capital Securities as "Tier 1 Capital" shall not constitute the
basis for a Capital Treatment Event if such inability results from the Debenture
Issuer having cumulative preferred stock, minority interests in consolidated
subsidiaries and any other class of security or interest which the Federal
Reserve (or any successor regulatory authority with jurisdiction over bank
holding companies) may now or hereafter accord "Tier 1 Capital" treatment that,
in the aggregate, exceed the amount which may now or hereafter qualify for
treatment as "Tier 1 Capital" under applicable capital adequacy guidelines of
the Federal Reserve (or any successor regulatory authority with jurisdiction
over bank holding companies), applied as if the Debenture Issuer (or its
successor) were a bank holding company for purposes of the capital adequacy
guidelines of the Federal Reserve (or any successor regulatory authority with
jurisdiction over bank holding companies); provided, further, that the
distribution of the Debentures in connection with the Liquidation of the Trust
by the Debenture Issuer shall not in and of itself constitute a Capital
Treatment Event unless such Liquidation shall have occurred in connection with a
Tax Event or an Investment Company Event. For the avoidance of doubt, the
adoption by the Board of Governors of the Federal Reserve System as a final rule
of any of the

                                     A-I-8
<PAGE>

proposals set forth in its notice of proposed rulemaking dated May 6, 2004,
shall not constitute a Capital Treatment Event.

            "Optional Redemption Price" means an amount in cash equal to 100% of
the principal amount of the Debentures being redeemed plus unpaid interest
accrued on such Debentures to the related Optional Redemption Date.

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

            "Special Redemption Price" means, with respect to the redemption of
the Debentures following a Special Event, an amount in cash equal to 104.000% of
the principal amount of Debentures to be redeemed prior to February 23, 2006 and
thereafter equal to the percentage of the principal amount of the Debentures
that is specified below for the Special Redemption Date plus, in each case,
unpaid interest accrued thereon to the Special Redemption Date:

<TABLE>
<CAPTION>
Special Redemption During the 12-Month
    Period Beginning February 23,         Percentage of Principal Amount
--------------------------------------    ------------------------------
<S>                                       <C>
2006                                               103.200%

2007                                               102.400%

2008                                               101.600%

2009                                               100.840%

2010 and thereafter                                100.000%
</TABLE>

            (b) Upon any repayment of the Debentures at maturity or in whole or
in part upon redemption (other than following the distribution of the Debentures
to the Holders of the Securities), the proceeds from such repayment shall
concurrently be applied to redeem Pro Rata, at a redemption price corresponding
to the applicable Maturity Redemption Price, Optional Redemption Price or
Special Redemption Price for the Debentures, as the case may be, Securities
having an aggregate liquidation amount equal to the aggregate principal amount
of the Debentures so repaid; provided, however, that Holders of such Securities
shall be given not less than 30 nor more than 60 days' prior written notice of
such redemption (other than a redemption resulting from the maturity of the
Debentures on the Maturity Date).

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

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

                                     A-I-9
<PAGE>

            (e) Redemption or Distribution Procedures.

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

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

                  (iii) If the Securities are to be redeemed and the Trust gives
      a Redemption/Distribution Notice, which notice may only be issued if the
      Debentures are redeemed or repaid as set out in this Section (which notice
      will be irrevocable), then, provided, that the Institutional Trustee has a
      sufficient amount of cash in connection with the related redemption or
      maturity of the Debentures, the Institutional Trustee will pay the price
      payable upon redemption of the Securities to the Holders of such
      Securities by check mailed to the address of each such Holder appearing on
      the books and records of the Trust on the related date of redemption. If a
      Redemption/Distribution Notice shall have been given and funds deposited
      as required, then immediately prior to the close of business on the date
      of such deposit, Distributions will cease to accrue on the Securities so
      subject to redemption and all rights of Holders of such Securities so
      subject to redemption will cease, except the right of the Holders of such
      Securities to receive the applicable price specified in Section 4(a), but
      without interest on such price. If any date of redemption of the
      Securities falls on a day that is not a Business Day, then payment of all
      amounts payable on such date will be made on the next succeeding Business
      Day, and no additional Distributions will accrue in respect of such
      payment on such next succeeding Business Day. If any amount payable upon
      redemption of the Securities is improperly withheld or refused and not
      paid either by the Trust, the Debenture Issuer or the Sponsor as guarantor
      pursuant to the Guarantee, Distributions on such Securities will continue
      to accrue at the Coupon Rate applicable from the date of redemption to the
      actual date of payment, in which case the actual payment date will be
      considered the date of redemption for purposes of calculating the price
      payable upon redemption of the Securities. In the event of any redemption
      of the Capital Securities issued by the Trust in part, the Trust shall not
      be required to (i) issue, register the transfer of or exchange any
      Security during a period beginning at the opening of business 15 days
      before any

                                     A-I-10
<PAGE>

      selection for redemption of the Capital Securities and ending at the close
      of business on the earliest date on which the relevant notice of
      redemption is deemed to have been given to all Holders of the Capital
      Securities to be so redeemed or (ii) register the transfer of or exchange
      any Capital Securities so selected for redemption, in whole or in part,
      except for the unredeemed portion of any Capital Securities being redeemed
      in part.

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

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

            5. Voting Rights - Capital Securities. (a) Except as provided under
Sections 5(b) and 7 and as otherwise required by law and the Declaration, the
Holders of the Capital Securities will have no voting rights. The Administrators
are required to call a meeting of the Holders of the Capital Securities if
directed to do so by Holders of not less than 10% in liquidation amount of the
Capital Securities.

            (b) Subject to the requirements of obtaining a tax opinion by the
Institutional Trustee in certain circumstances set forth in the last sentence of
this paragraph, the Holders of a Majority in liquidation amount of the Capital
Securities, voting separately as a class, have the right to direct the time,
method, and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under the Declaration, including (i) directing the time,
method, place of conducting any proceeding for any remedy available to the
Debenture Trustee, or exercising any trust or power conferred on the Debenture
Trustee with respect to the Debentures, (ii) waiving any past default and its
consequences that are waivable under the Indenture, (iii) exercising any right
to rescind or annul an acceleration of the principal of all the Debentures or
(iv) consenting on behalf of all the Holders of the Capital Securities to any
amendment, modification or termination of the Indenture or the Debentures where
such consent shall be required; provided, however, that, where a consent or
action under the Indenture would require the consent or act of the holders of
greater than a simple majority in principal amount of Debentures (a "Super
Majority") affected thereby, the Institutional Trustee may only give such
consent or take such action at the written direction of the Holders of not less
than the proportion in liquidation amount of the Capital Securities outstanding
which the relevant Super Majority represents of the aggregate principal amount
of the Debentures outstanding. If the Institutional Trustee fails to enforce its
rights under the Debentures after the Holders of a Majority or Super Majority,
as the case may be, in liquidation amount of such Capital Securities have so
directed the Institutional Trustee, to the fullest extent permitted by law, a
Holder of the Capital Securities may institute a legal proceeding directly
against the Debenture Issuer to enforce the Institutional Trustee's rights under
the Debentures without first instituting any legal proceeding against the
Institutional Trustee or any other person or entity. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and such event
is attributable to the failure of the Debenture Issuer to

                                     A-I-11
<PAGE>

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

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

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

            In no event will Holders of the Capital Securities have the right to
vote to appoint, remove or replace the Administrators, which voting rights are
vested exclusively in the Sponsor as the Holder of all of the Common Securities
of the Trust. Under certain circumstances as more fully described in the
Declaration, Holders of Capital Securities have the right to vote to appoint,
remove or replace the Institutional Trustee and the Delaware Trustee.

                                     A-I-12
<PAGE>

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

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

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

            Any approval or direction of the Holder of the Common Securities may
be given at a separate meeting of Holders of the Common Securities convened for
such purpose, at a meeting of all of the Holders of the Securities in the Trust
or pursuant to written consent. The Administrators will cause a notice of any
meeting at which the Holder of the Common Securities is entitled to vote, or of
any matter upon which action by written consent of such Holder is to be taken,
to be mailed to the Holder of the Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holder is 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 Holder 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. In addition to any
requirements under Section 11.1 of the Declaration, if any proposed amendment to
the

                                     A-I-13
<PAGE>

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

            (a) In the event the consent of the Institutional Trustee, as the
holder of the Debentures, is required under the Indenture with respect to any
amendment, modification or termination of the Indenture or the Debentures, the
Institutional Trustee shall request the written direction of the Holders of the
Securities with respect to such amendment, modification or termination and shall
vote with respect to such amendment, modification, or termination as directed by
a Majority in liquidation amount of the Securities voting together as a single
class; provided, however, that where a consent under the Indenture would require
a Super Majority, the Institutional Trustee may only give such consent at the
written direction of the Holders of not less than the proportion in liquidation
amount of the Securities which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding.

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

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

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

                                     A-I-14
<PAGE>

only after satisfaction of all amounts owed to the Holders of the Capital
Securities, to each Holder of the Common Securities Pro Rata according to the
aggregate liquidation amount of the Common Securities held by the relevant
Holder relative to the aggregate liquidation amount of all Common Securities
outstanding.

            9. Ranking. The Capital Securities rank pari passu with, and payment
thereon shall be made Pro Rata with, the Common Securities except that, where an
Event of Default has occurred and is continuing, the rights of Holders of the
Common Securities to receive payment of Distributions and payments upon
Liquidation, redemption and otherwise are subordinated to the rights of the
Holders of the Capital Securities with the result that no payment of any
Distribution on, or any amount payable upon the redemption of, any Common
Security, and no payment to the Holder of any Common Security on account of the
Liquidation of the Trust, shall be made unless payment in full in cash of (i)
all accrued and unpaid Distributions on all outstanding Capital Securities for
all Distribution Periods terminating on or prior thereto, (ii) all amounts
payable upon Capital Securities then subject to redemption and (iii) all amounts
payable upon Capital Securities in the event of the Liquidation of the Trust, in
each case, shall have been made or provided for, and all funds immediately
available to the Institutional Trustee shall first be applied to the payment in
full in cash of the amounts specified in clause (i), (ii) and (iii) above that
are then due and payable.

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

            11. No Preemptive Rights. The Holders of the Securities shall have
no, and the issuance of the Securities is not subject to, preemptive or similar
rights to subscribe for any additional securities.

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

                                     A-I-15
<PAGE>

                                   EXHIBIT A-1

                      FORM OF CAPITAL SECURITY CERTIFICATE

                           [FORM OF FACE OF SECURITY]

            THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY OR ANY INTEREST
OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY
BE, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY OR ANY INTEREST OR
PARTICIPATION HEREIN PRIOR TO THE DATE WHICH IS THE LATER OF (i) TWO YEARS (OR
SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES
ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF AND (Z) THE
LAST DATE ON WHICH THE TRUST OR ANY AFFILIATE (AS DEFINED IN RULE 405 UNDER THE
SECURITIES ACT) OF THE TRUST WAS THE HOLDER OF THIS SECURITY OR SUCH INTEREST OR
PARTICIPATION (OR ANY PREDECESSOR THERETO) AND (ii) SUCH LATER DATE, IF ANY, AS
MAY BE REQUIRED BY ANY SUBSEQUENT CHANGE IN APPLICABLE LAW, ONLY (A) TO THE
DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER," AS DEFINED IN RULE 144A, THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2), (3), (7)
OR (8) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY OR
SUCH INTEREST OR PARTICIPATION FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH
AN ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, (D) PURSUANT TO OFFERS AND SALES TO NON-US PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES PURSUANT TO REGULATION S UNDER THE SECURITIES ACT OR
(E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT, SUBJECT TO THE RIGHT OF THE DEBENTURE ISSUER AND THE
TRUST PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (C) OR (E)
ABOVE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE AMENDED
AND RESTATED DECLARATION OF

                                      A-1-1
<PAGE>

TRUST, A COPY OF WHICH MAY BE OBTAINED FROM THE DEBENTURE ISSUER OR THE TRUST.
THE HOLDER OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, BY ITS
ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY BE, AGREES THAT IT WILL COMPLY
WITH THE FOREGOING RESTRICTIONS.

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

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

            THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS
HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN
EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A
LIQUIDATION AMOUNT OF LESS THAN $100,000

                                      A-1-2
<PAGE>

SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED
TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SECURITY OR ANY INTEREST
OR PARTICIPATION HEREIN FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE
RECEIPT OF DISTRIBUTIONS ON THIS SECURITY OR SUCH INTEREST OR PARTICIPATION, AND
SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS
SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN.

                                     A-1-3
<PAGE>

Certificate Number [_____]                  Number of Capital Securities [_____]

                                CUSIP NO [   ]

                    Certificate Evidencing Capital Securities

                                       of

                                  BOFI TRUST I

                               Capital Securities

                (liquidation amount $1,000 per Capital Security)

            BofI Trust I, a statutory trust created under the laws of the State
of Delaware (the "Trust"), hereby certifies that [       ] is the registered
owner (the "Holder") of ______________ capital securities of the Trust
representing undivided beneficial interests in the assets of the Trust,
designated as MMCapS(SM) (liquidation amount $1,000 per Capital Security) (the
"Capital Securities"). Subject to the Declaration (as defined below), the
Capital Securities are transferable on the books and records of the Trust, in
person or by a duly authorized attorney, upon surrender of this Certificate duly
endorsed and in proper form for transfer. The Capital Securities represented
hereby are issued pursuant to, and the designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Capital
Securities shall in all respects be subject to, the provisions of the Amended
and Restated Declaration of Trust of the Trust, dated as of December 16, 2004,
among Gary Lewis Evans, Andrew J. Micheletti and Michelle Paulus, as
Administrators, Wilmington Trust Company, as Delaware Trustee, Wilmington Trust
Company, as Institutional Trustee, BofI Holding, Inc., as Sponsor, and the
holders from time to time of undivided beneficial interests in the assets of the
Trust, including the designation of the terms of the Capital Securities as set
forth in Annex I to the Declaration, as the same may be amended from time to
time (the "Declaration"). Capitalized terms used herein but not defined shall
have the meaning given them in the Declaration. The Holder is entitled to the
benefits of the Guarantee and the Indenture to the extent provided therein. The
Sponsor will provide a copy of the Declaration, the Guarantee, and the Indenture
to the Holder without charge upon written request to the Sponsor at its
principal place of business.

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

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

            This Certificate and the Capital Securities evidenced hereby are
governed by, and shall be construed in accordance with, the laws of the State of
Delaware, without regard to principles of conflict of laws.

            This Certificate may contain more than one counterpart of the
signature page and this Certificate may be executed and authenticated by the
affixing of the signature of an

                                     A-1-4
<PAGE>

Administrator on behalf of the Trust, and the signature of the Institutional
Trustee providing authentication, to any of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though the Trust had executed, and the
Institutional Trustee had authenticated, a single signature page.

                                     A-1-5
<PAGE>

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

                                   BOFI TRUST I

                                   By:________________________________
                                      Name:
                                      Title: Administrator

                                   Dated: ___________________________

                          CERTIFICATE OF AUTHENTICATION

            This Certificate represents Capital Securities referred to in the
within-mentioned Declaration.

                                   WILMINGTON TRUST COMPANY,
                                   not in its individual capacity but solely as
                                   the Institutional Trustee

                                   By:_______________________________
                                      Authorized Officer

                                   Dated: ___________________________

                                     A-1-6
<PAGE>

                          [FORM OF REVERSE OF SECURITY]

            Distributions payable on each Capital Security will be payable at a
rate of interest per annum, which, with respect to any Distribution Period,
LIBOR, as determined on the LIBOR Determination Date for such Distribution
Period (or, in the case of the first Distribution Period, will be 2.50%) plus
2.40% (the "Coupon Rate"); provided, however, that the Coupon Rate for any
Distribution Period may not exceed the Interest Rate (as defined in the
Indenture) for the related Interest Period (as defined in the Indenture).
Distributions in arrears for more than one Distribution Period will bear
interest thereon, compounded quarterly, at the applicable Coupon Rate for each
Distribution Period thereafter (to the extent permitted by applicable law). The
term "Distributions", as used herein, includes cash Distributions, any such
compounded Distributions and any Additional Amounts payable on the Debentures,
unless otherwise stated. A Distribution is payable only to the extent that
payments are made in respect of the Debentures held by the Institutional Trustee
and to the extent the Institutional Trustee has funds legally available in the
Property Account therefor. The amount of Distributions payable for any
Distribution Period will be computed on the basis of a 360-day year and the
actual number of days elapsed in such Distribution Period.

            Except as otherwise described below, Distributions on the Capital
Securities will be cumulative, will accrue from the date of original issuance
and will be payable quarterly in arrears on February 23, May 23, August 23 and
November 23 of each year, commencing on February 23, 2005 (each, a "Distribution
Payment Date"), and on any earlier date of redemption, subject, in each case, to
the Business Day convention specified in the Declaration. The Debenture Issuer
has the right under the Indenture to defer payments of interest on the
Debentures by extending the interest payment period for up to 20 consecutive
quarterly periods (each such extended interest payment period, together with all
previous and future consecutive extensions thereof, is referred to herein as an
"Extension Period") at any time and from time to time on the Debentures, subject
to the conditions described below and in the Declaration and the Indenture. No
Extension Period may end on a date other than a Distribution Payment Date or
extend beyond the Maturity Date, any Optional Redemption Date or the Special
Redemption Date, as the case may be. During any Extension Period, interest will
continue to accrue on the Debentures, and interest on such accrued interest
(such accrued interest and interest thereon referred to herein as "Deferred
Interest") will accrue, at an annual rate equal to the Coupon Rate applicable
during such Extension Period, compounded quarterly from the date such Deferred
Interest would have been payable were it not for the Extension Period, to the
extent permitted by applicable law. At the end of any Extension Period, the
Debenture Issuer shall pay all Deferred Interest then accrued and unpaid on the
Debentures; provided, however, that prior to the termination of any Extension
Period, the Debenture Issuer may further extend such Extension Period, provided,
that no Extension Period (including all previous and further consecutive
extensions that are part of such Extension Period) shall exceed 20 consecutive
quarterly periods. Upon the termination of any Extension Period and upon the
payment of all Deferred Interest, the Debenture Issuer may commence a new
Extension Period, subject to the requirements set forth herein and in the
Declaration and the Indenture. No interest or Deferred Interest (except any
Additional Amounts that may be due and payable) shall be due and payable during
an Extension Period, except at the end thereof, but Deferred Interest shall
accrue upon each installment of

                                     A-1-7
<PAGE>

interest that would otherwise have been due and payable during such Extension
Period until such installment is paid.

            As a consequence of any Extension Period, Distributions will be
deferred. If Distributions are deferred, the Distributions due shall be paid on
the date that the related Extension Period terminates to Holders of the Capital
Securities as they appear on the books and records of the Trust on the regular
record date immediately preceding the Distribution Payment Date on which such
Extension Period terminates to the extent that the Trust has funds legally
available for the payment of such Distributions in the Property Account of the
Trust.

            The Capital Securities shall be redeemable, and shall be entitled to
the Liquidation Distribution, as provided in the Declaration.

                                     A-1-8
<PAGE>

                                   ASSIGNMENT

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

_____________________________

_____________________________

_____________________________

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

_____________________________

_____________________________

_____________________________

(Insert address and zip code of assignee),

and irrevocably appoints ______________________________________________________
as agent to transfer the Capital Securities evidenced by this Capital Security
Certificate on the books of the Trust. The agent may substitute another to act
for it, him or her.

            Date:__________________

            Signature:__________________

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

            Signature Guarantee:(1) ____________________________

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

                                     A-1-9
<PAGE>

                                   EXHIBIT A-2

                       FORM OF COMMON SECURITY CERTIFICATE

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

            EXCEPT AS SET FORTH IN SECTION 8.1(b) OF THE DECLARATION (AS DEFINED
BELOW), THIS SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED.

                                     A-2-1
<PAGE>

Certificate Number [_____]                    Number of Common Securities [____]

                    Certificate Evidencing Common Securities

                                       of

                                  BOFI TRUST I

            BofI Trust I, a statutory trust created under the laws of the State
of Delaware (the "Trust"), hereby certifies that BofI Holding, Inc. is the
registered owner (the "Holder") of ______________ common securities of the Trust
representing undivided beneficial interests in the assets of the Trust
(liquidation amount $1,000 per Common Security)(the "Common Securities"). The
Common Securities represented hereby are issued pursuant to, and the
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities shall in all respects be subject to, the
provisions of the Amended and Restated Declaration of Trust of the Trust, dated
as of December 16, 2004, among Gary Lewis Evans, Andrew J. Micheletti and
Michelle Paulus, as Administrators, Wilmington Trust Company, as Delaware
Trustee, Wilmington Trust Company, as Institutional Trustee, the Holder, as
Sponsor, and the holders from time to time of undivided beneficial interests in
the assets of the Trust, including the designation of the terms of the Common
Securities as set forth in Annex I to the Declaration, as the same may be
amended from time to time (the "Declaration"). Capitalized terms used herein but
not defined shall have the meaning given them in the Declaration. The Sponsor
will provide a copy of the Declaration and the Indenture to the Holder without
charge upon written request to the Sponsor at its principal place of business.

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

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

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

            This Certificate and the Common Securities evidenced hereby are
governed by, and shall be construed in accordance with, the laws of the State of
Delaware, without regard to principles of conflict of laws.

                                     A-2-2
<PAGE>

            IN WITNESS WHEREOF, the Trust has executed this Certificate this ___
day of ____, 2004.

                                              BOFI TRUST I

                                              By:______________________________
                                                 Name:
                                                 Title: Administrator

                                     A-2-3
<PAGE>

                          [FORM OF REVERSE OF SECURITY]

            Distributions payable on each Common Security will be identical in
amount to the Distributions payable on each Capital Security, which is at a rate
of interest per annum, which, with respect to any Distribution Period (as
defined herein) will be equal to LIBOR, as determined on the LIBOR Determination
Date for such Distribution Period (or, in the case of the first Distribution
Period, will be 2.50%), plus 2.40% (the "Coupon Rate"); provided, however, that
the Coupon Rate for any Distribution Period may not exceed the Interest Rate (as
defined in the Indenture) for the related Interest Period (as defined in the
Indenture). Distributions in arrears for more than one Distribution Period will
bear interest thereon, compounded quarterly, at the applicable Coupon Rate for
each Distribution Period thereafter (to the extent permitted by applicable law).
The term "Distributions", as used herein, includes cash Distributions, any such
compounded Distributions and any Additional Amounts payable on the Debentures,
unless otherwise stated. A Distribution is payable only to the extent that
payments are made in respect of the Debentures held by the Institutional Trustee
and to the extent the Institutional Trustee has funds legally available in the
Property Account therefor. The amount of Distributions payable for any
Distribution Period will be computed on the basis of a 360-day year and the
actual number of days elapsed in such Distribution Period.

            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 February 23, May 23, August 23 and
November 23 of each year, commencing on February 23, 2005 (each, a "Distribution
Payment Date"), and on any earlier date of redemption, subject, in each case, to
the Business Day convention specified in the Declaration. The Debenture Issuer
has the right under the Indenture to defer payments of interest on the
Debentures by extending the interest payment period for up to 20 consecutive
quarterly periods (each such extended interest payment period, together with all
previous and future consecutive extensions thereof, is referred to herein as an
"Extension Period") at any time and from time to time on the Debentures, subject
to the conditions described below and in the Declaration and the Indenture. No
Extension Period may end on a date other than a Distribution Payment Date or
extend beyond the Maturity Date, any Optional Redemption Date or the Special
Redemption Date, as the case may be. During any Extension Period, interest will
continue to accrue on the Debentures, and interest on such accrued interest
(such accrued interest and interest thereon referred to herein as "Deferred
Interest") will accrue, at an annual rate equal to the Coupon Rate applicable
during such Extension Period, compounded quarterly from the date such Deferred
Interest would have been payable were it not for the Extension Period, to the
extent permitted by applicable law. At the end of any Extension Period, the
Debenture Issuer shall pay all Deferred Interest then accrued and unpaid on the
Debentures; provided, however, that prior to the termination of any Extension
Period, the Debenture Issuer may further extend such Extension Period, provided,
that no Extension Period (including all previous and further consecutive
extensions that are part of such Extension Period) shall exceed 20 consecutive
quarterly periods. Upon the termination of any Extension Period and upon the
payment of all Deferred Interest, the Debenture Issuer may commence a new
Extension Period, subject to the requirements set forth herein and in the
Declaration and the Indenture. No interest or Deferred Interest (except any
Additional Amounts that may be due and payable) shall be due and payable during
an Extension Period, except at the end thereof, but Deferred Interest shall
accrue upon each installment of

                                     A-2-4
<PAGE>

interest that would otherwise have been due and payable during such Extension
Period until such installment is paid.

            As a consequence of any Extension Period, Distributions will be
deferred. If Distributions are deferred, the Distributions due shall be paid on
the date that the related Extension Period terminates to Holders of the
Securities as they appear on the books and records of the Trust on the regular
record date immediately preceding the Distribution Payment Date on which such
Extension Period terminates to the extent that the Trust has funds legally
available for the payment of such Distributions in the Property Account of the
Trust.

            The Common Securities shall be redeemable, and shall be entitled to
the Liquidation Distribution, as provided in the Declaration.

                                     A-2-5
<PAGE>

                                   ASSIGNMENT

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

____________________________

____________________________

____________________________

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

____________________________

____________________________

____________________________

(Insert address and zip code of assignee),

and irrevocably appoints ____________________ as agent to transfer the Common
Securities evidenced by this Common Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.

            Date:____________________

            Signature:________________________

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

            Signature Guarantee:(1) ________________________

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

                                     A-2-6
<PAGE>

                                                                       EXHIBIT B

                         FORM OF TRANSFEREE CERTIFICATE

                     TO BE EXECUTED BY ACCREDITED INVESTORS

                                                                _________, [   ]

BofI Holding, Inc.
BofI Trust I
12220 El Camino Real, Suite 220
San Diego, California 92130

Re:   Purchase of $[SPECIFY] liquidation amount of MMCapS(SM)
      (the "Capital Securities") of BofI Trust I (the "Trust")

Ladies and Gentlemen:

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

            1. We understand that the Capital Securities of the Trust have not
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), and may not be offered or sold except as permitted in the following
sentence. We agree on our own behalf and on behalf of any investor account for
which we are purchasing the Capital Securities that, if we decide to offer, sell
or otherwise transfer any such Capital Securities prior to the date which is the
later of (i) two years (or such shorter period of time as permitted by Rule
144(k) under the Securities Act) after the later of (Y) the date of original
issuance of the Capital Securities and (Z) the last date on which the Trust or
any Affiliate (as defined in Rule 405 under the Securities Act) of the Trust was
the holder of any such Capital Securities (or any predecessor thereto) and (ii)
such later date, if any, as may be required by any subsequent change in
applicable law (the "Resale Restriction Termination Date"), then such offer,
sale or other transfer will be made only (a) to the Company or the Trust, (b)
pursuant to Rule 144A under the Securities Act, to a person we reasonably
believe is a qualified institutional buyer under Rule 144A (a "QIB"), that
purchases for its own account or for the account of a QIB and to whom notice is
given that the transfer is being made in reliance on Rule 144A, (c) pursuant to
an exemption from registration, to an "accredited investor" within the meaning
of subparagraph (a) (1), (2), (3), (7) or (8) of Rule 501 under the Securities
Act that is acquiring any such Capital Securities for its own account or for the
account of such an accredited investor for investment purposes and not with a
view to, or for offer or sale in connection with, any distribution thereof in
violation of the Securities Act, (d) pursuant to offers and sales to a non-U.S.
Person that occur outside the United States pursuant to Regulation S under the
Securities Act, or (e) pursuant to another available exemption from the
registration requirements of the Securities Act, and in each of the foregoing
cases in accordance with any applicable state securities laws and any
requirements of law that govern the disposition of our property. If any resale
or other transfer of the Capital Securities is proposed to be made pursuant to
clause (c) above, the transferor shall deliver a letter from the transferee
substantially in the form of this letter to the Institutional Trustee as
Transfer Agent, which shall provide as applicable, among other things, that the
transferee is an accredited investor within the meaning of

                                      B-1
<PAGE>

subparagraph (a)(1), (2), (3), (7) or (8) of Rule 501 under the Securities Act
that is acquiring such Capital Securities for investment purposes and not for
any distribution in violation of the Securities Act. We acknowledge on our
behalf and on behalf of any investor account for which we are purchasing Capital
Securities that the Company and the Trust reserve the right prior to any offer,
sale or other transfer pursuant to clause (c) or (e) to require the delivery of
any opinion of counsel, certifications and/or other information satisfactory to
BofI Holding, Inc. (the "Company") and the Trust. We understand that the
certificates for any Capital Securities that we receive prior to the Resale
Restriction Termination Date will bear a legend substantially to the effect of
the foregoing.

            2. We are an accredited investor within the meaning of subparagraph
(a) (1), (2), (3), (7) or (8) of Rule 501 under the Securities Act purchasing
for our own account or for the account of such an accredited investor, and we
are acquiring the Capital Securities for investment purposes and not with view
to, or for offer or sale in connection with, any distribution in violation of
the Securities Act, and we have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of our
investment in the Capital Securities, and we and any account for which we are
acting are each able to bear the economic risks of our or its investment.

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

            4. In the event that we purchase any Capital Securities, we will
acquire such Capital Securities having an aggregate liquidation amount of not
less than $100,000 for our own account and for each separate account for which
we are acting.

            5. We acknowledge that we either (A) are not a fiduciary of a
pension, profit-sharing or other employee benefit plan or arrangement subject to
the Employee Retirement Income Security Act of 1974, as amended, or to Section
4975 of the Internal Revenue Code of 1986, as amended (a "Plan"), or an entity
whose assets include "plan assets" by reason of any Plan's investment in the
entity and are not purchasing the Capital Securities on behalf of or with "plan
assets" by reason of any Plan's investment in the entity and are not purchasing
the Capital Securities on behalf of or with "plan assets" of any Plan or (B) are
eligible for the exemptive relief available under one or more of the following
prohibited transaction class exemptions ("PTCEs") issued by the U.S. Department
of Labor: PTCE 96-23, 95-60, 91-38, 90-1 or 84-14.

            6. We acknowledge that each Plan, by its purchase of the Capital
Securities, will be deemed to have directed the Trust to invest in the junior
subordinated debt securities of the Company, and to have consented to the
appointment of the institutional trustee of the Trust.

            7. We acknowledge that the Company, the Trust and others will rely
upon the truth and accuracy of the foregoing acknowledgments, representations,
warranties and agreements and agree that if any of our acknowledgments,
representations, warranties and

                                      B-2
<PAGE>

agreements are no longer accurate, we shall promptly notify the applicable
Purchaser. If we are acquiring any Capital Securities as a fiduciary or agent
for one or more investor accounts, we represent that we have sole discretion
with respect to each such investor account and that we have full power to make
the foregoing acknowledgments, representations and agreements on behalf of each
such investor account.

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

                                   __________________________________
                                   (Name of Purchaser)

                                   By:_______________________________

                                   Date:_____________________________

            Upon transfer, the Capital Securities should be registered in the
name of the new beneficial owner as follows.

Name:_______________________

Address:______________________

Taxpayer ID Number:_____________________

                                      B-3
<PAGE>

                                                                       EXHIBIT C

                         FORM OF TRANSFEROR CERTIFICATE
                             TO BE EXECUTED FOR QIBs

                                                                  ________, [  ]

BofI Holding, Inc.
BofI Trust I
12220 El Camino Real, Suite 220
San Diego, California 92130

Re:   Purchase of $[SPECIFY] liquidation amount of MMCapS(SM)
      (the "Capital Securities") of BofI Trust I (the "Trust")

            Reference is hereby made to the Amended and Restated Declaration of
Trust of BofI Trust I, dated as of December 16, 2004 (the "Declaration"), among
Gary Lewis Evans, Andrew J. Micheletti and Michelle Paulus, as Administrators,
Wilmington Trust Company, as Delaware Trustee, Wilmington Trust Company, as
Institutional Trustee, BofI Holding, Inc., as Sponsor, and the holders from time
to time of undivided beneficial interests in the assets of the Trust.
Capitalized terms used but not defined herein shall have the meanings given them
in the Declaration.

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

            In accordance with Section 8.2(b) of the Declaration, the Transferor
does hereby certify that such Capital Securities are being transferred in
accordance with (i) the transfer restrictions set forth in the Capital
Securities and (ii) Rule 144A under the Securities Act ("Rule 144A"), to a
transferee that the Transferor reasonably believes is purchasing the Capital
Securities for its own account or an account with respect to which the
transferee exercises sole investment discretion and the transferee and any such
account is a "qualified institutional buyer" within the meaning of Rule 144A, in
a transaction meeting the requirements of Rule 144A and in accordance with
applicable securities laws of any state of the United States or any other
jurisdiction.

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

                                       ____________________________
                                       (Name of Transferor)

                                    By:__________________________
                                       Name:__________________________
                                       Title:__________________________

                                       Date:__________________________

                                      C-1
<PAGE>

                                                                       EXHIBIT D

                         FORM OF TRANSFEREE CERTIFICATE
                       TO BE EXECUTED BY NON-U.S. PERSONS

                                                                _________, [   ]

BofI Holding, Inc.
BofI Trust I
12220 El Camino Real, Suite 220
San Diego, California 92130

Re:   Purchase of $[SPECIFY] liquidation amount of MMCapS(SM)
      (the "Capital Securities") of BofI Trust I (the "Trust")

            Reference is hereby made to the Amended and Restated Declaration of
Trust of BofI Trust I, dated as of December 16, 2004 (the "Declaration"), among
Gary Lewis Evans, Andrew J. Micheletti and Michelle Paulus, as Administrators,
Wilmington Trust Company, as Delaware Trustee, Wilmington Trust Company, as
Institutional Trustee, BofI Holding, Inc., as Sponsor, and the holders from time
to time of undivided beneficial interests in the assets of the Trust.
Capitalized terms used but not defined herein shall have the meanings given them
in the Declaration.

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

            In accordance with Section 8.2(b) of the Declaration, we do hereby
certify that (i) we are not a "U.S. person" (as such term is defined in Rule 902
under the Securities Act), (ii) we are not acquiring the Capital Securities for
the account or benefit of any U.S. person, and (iii) the offer and sale of
Capital Securities to us constitutes an "offshore transaction" under Regulation
S under the Securities Act.

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

                                   __________________________
                                   (Name of Transferee)

                                By:__________________________
                                   Name:___________________________
                                   Title:__________________________

                                   Date:__________________________

                                       D-1

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