Document:

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Exhibit 4.2

                                WARRANT AGREEMENT

         THIS AGREEMENT, dated as of this 7th day of September, 2001, by and
between Gateway Bank & Trust Co., a North Carolina state chartered bank (the
"Bank") and SunTrust Banks, Inc., (the "Transfer Agent").

         WHEREAS, the Bank in connection with its offering (the "Offering") of
approximately one million one hundred and eleven thousand (1,111,000) shares of
its par value $5.00 common stock (the "Common Stock") is issuing an aggregate of
approximately one million one hundred and eleven thousand (1,111,000) warrants
(the "Warrants") to purchase the Bank's Common Stock, such that one Warrant
shall be issued for each share of the Bank's Common Stock sold in the Offering.

         WHEREAS, the Bank desires to appoint the Transfer Agent to act on its
behalf in connection with the (i) issuance, transfer and exchange of the
certificates representing the Warrants (the "Warrant Certificates"), (ii) the
exercise of the Warrants by the holders thereof (together with any registered
successors or assigns, the "Holders") and (iii) the adjustment of the Warrants
in certain events as contained herein;

         NOW, THEREFORE, the parties hereto hereby agree as follows:

         1. APPOINTMENT OF TRANSFER AGENT. The Bank hereby appoints the Transfer
Agent as its agent to issue the Warrant Certificates, as set forth herein at the
usual and customary rates under the current agreement between the Bank and the
Transfer Agent, subject to resignation or replacement as provided herein. The
Transfer Agent agrees to accept such appointment, subject to the terms and
conditions as set forth herein and to issue, transfer and exchange the Warrant
Certificates pursuant to the terms as provided for herein to issue the
certificates representing the appropriate number of shares of Common Stock (or
other consideration) upon exercise of the Warrants. The Bank agrees to issue and
honor the Warrants on the terms and conditions as herein set forth and to issue
its Common Stock (or other securities) upon notice from the Transfer Agent of
the proper exercise of any Warrant. The Transfer Agent is hereby empowered to
enforce any rights of the Holders for the benefit of any Holders, subject to the
terms and conditions contained herein.

         2. ISSUANCE OF WARRANT CERTIFICATES.

                  2.1. Form of Warrant Certificate. All Warrants shall be issued
substantially in the form of the Warrant Certificate annexed hereto as Exhibit
A. The terms of any such Certificate are incorporated herein by reference.

                  2.2. Execution of Warrants. No Warrants shall have been duly
and validly issued until a Holder has received a Warrant Certificate executed by
the chairman or president of the Bank and the secretary or treasurer of the Bank
and such Certificate is countersigned by an authorized officer of the Transfer
Agent. Any Warrant Certificates may be executed by the officers of the Bank by
means of a facsimile signature. The Transfer Agent shall maintain the register
of all Holders.

                  2.3. Maximum Number of Warrants. The Bank hereby authorizes
the Transfer Agent to issue an aggregate of approximately one million one
hundred and eleven thousand (1,111,000) Warrants pursuant to the terms hereof
subject to adjustment as hereafter provided in Section 4 hereof.

                  2.4. Initial Holders. The Bank shall deliver to the Transfer
Agent a list of the names of the persons who shall be the initial Holders of the
Warrants and the number of Warrants to which each such person is entitled. The
Transfer Agent is hereby authorized by the Bank to promptly issue Warrant
Certificates for approximately one million one hundred and eleven thousand
(1,111,000) Warrants upon receipt of the written request of the Bank, which
shall include the list referred to in the preceding sentence. The Bank shall
deliver to the Transfer Agent, along with this Warrant Agreement, a sufficient
number of duly executed Warrant Certificates. The Warrant Certificates shall be
completed and countersigned by the Transfer Agent and promptly mailed or
delivered to the Holders pursuant to the terms hereof. When requested by the
Transfer Agent, from time to time hereafter, the Bank will execute additional
Warrant Certificates in blank for the Transfer Agent to issue hereunder.

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         3. RIGHTS OF A HOLDER. Subject to adjustment as provided herein, each
Warrant shall evidence the right to purchase one share of the Bank's Common
Stock at the Warrant Price of $11.10. Following the Expiration Date, as defined
in Section 4.1 below, the Warrant shall be null and void.

         4. EXERCISE OR TRANSFER OF WARRANT.

                  4.1. Exercise Period. The Warrants may be exercised at any
time commencing after June 27, 2001 (the "Initial Exercise Date") but not later
than 5:00 P.M., Eastern time, on June 30, 2004 (the "Expiration Date"). If the
Expiration Date is not a Business Day, it shall automatically be extended to
5:00 P.M. on the next day which is a Business Day. Business Day means any day
other than a Saturday, Sunday, or holiday on which banks in North Carolina are
authorized by law to close.

                  4.2. Means of Exercise. In order to exercise a Warrant, the
Holder must present and surrender the Warrant Certificate to the Transfer Agent
at its office, with the election to exercise section duly executed and it must
be accompanied by payment in full, in the form of cash, by certified or official
bank check payable to the order of the Bank or its successor, of the aggregate
Warrant Price for the number of shares of Common Stock specified in such
Election to Exercise Form.

                  4.3. Issuance of Common Stock. Upon the request of the
Transfer Agent, the Bank shall promptly deliver or cause to be delivered a
certificate or certificates evidencing the shares of Common Stock purchased when
any Warrant is validly exercised. Upon receipt of any Warrant Certificate by the
Transfer Agent, at its office, in proper form for exercise and accompanied by
payments as herein provided, the Holder shall be deemed to be the holder of
record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of the Bank shall then be closed
or that certificates representing such shares of Common Stock shall not then be
actually delivered to the Holder.

                  4.4. Warrants Not Transferrable Separate From Common Stock for
up to 45 Days. These Warrants shall be originally issued with an equal number of
shares of Common Stock in Units. During the 45 days following the date of
original issuance, the Warrants may only be transferred together with such
Common Stock as a unit. At any time after the original date of issuance, the
Bank may declare this restriction no longer applicable by written notice to the
Transfer Agent. The Bank shall also issue a press release but neither the Bank
nor the Transfer Agent shall be obligated to notify the Warrant holders.

                  4.5 Transfer. Upon surrender of this Warrant Certificate and
similar Warrant Certificates at the principal office of the Transfer Agent, by
the Holder hereof in person or by an attorney duly authorized in writing, with
the election to transfer section properly completed and duly executed, such
Warrant Certificates may be transferred or exchanged in the manner provided in
this Warrant Certificate and without payment of any service charge, for another
Warrant Certificate or Warrant Certificates of like tenor, evidencing in the
aggregate the number of Warrants evidenced by the Warrant Certificates so
surrendered and registered in the name or names as requested by the then
registered owner thereof or by an attorney duly authorized in writing. Warrants
transferred pursuant to such Section shall be accompanied by a proper payment of
any applicable transfer taxes.

         5. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF SHARES PURCHASABLE AND
OTHER TERMS IN CERTAIN EVENTS.

         5.1. The Purchase Price and the resulting number of shares of Common
Stock issuable under each Warrant shall be subject to adjustment as follows:

         (a) If the Bank after the date of this Warrant Certificate but before
         its exercise:

                  (1) pays a dividend or any other distribution payable in
                  shares of its Common Stock otherwise than out of earnings or
                  earned surplus;

                  (2) subdivides its outstanding shares of Common Stocks into a
                  greater number of shares;

                  (3) combines its outstanding shares of Common Stock into a
                  smaller number of shares;

                  (4) issues by reclassification of its shares of Common Stock
                  any shares of capital stock of the Bank (other than a change
                  in par value or from par value to no par value or from no par
                  value to par value); or

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                  (5) issues rights, options or warrants entitling holders of
                  shares of Common Stock to subscribe for shares of Common Stock
                  at less than the current market price, if any;

the Purchase Price in effect immediately prior to such action shall be adjusted
so that the holder of each Warrant may receive the number of shares of Common
Stock of the Bank to which it would have been entitled upon such action if such
holder had so exercised the Warrant immediately prior thereto. An adjustment
made pursuant to this Section 5 shall become effective immediately after the
record date for the determination of owners of Common Stock entitled thereto in
the case of a dividend or distribution, and shall become effective immediately
after the effective date in the case of a subdivision, combination,
reclassification, or issuance of rights, options or warrants retroactive to the
record date, if any, for such event.

         (b) No payment or adjustment shall be made by or on behalf of the Bank
on account of any cash dividends on the Common Stock issued upon any exercise of
a Warrant which was declared for payment to the holders of Common Stock of
record as of a date prior to the date on which such Warrant is exercised.

         (c) Upon each adjustment of the Purchase Price made pursuant to this
Section 5, each Warrant shall thereafter (until another such adjustment)
evidence the right to purchase that number of shares of Common Stock (calculated
to the nearest hundredth) obtained by dividing the Initial Purchase Price by the
Purchase Price in effect after such adjustment.

         (d) The Bank's failure to give the notice required by this Section 5.1
or any defect therein shall not affect the validity of such action listed under
this Section 5.1.

         (e) For the purpose of this Section 5.1, the term "shares of Common
Stock" shall mean (x) the class of stock designated as the Common Stock at the
date of this Warrant, or (y) any other class of stock resulting from successive
changes or reclassifications of such shares consisting solely of changes in par
value, from no par value to par value or from par value to no par value. In the
event that at any time, as a result of an adjustment made pursuant to this
Section 5, the Holder shall become entitled to purchase any shares of the Bank
other than shares of Common Stock, thereafter the number of such other shares so
purchasable upon exercise of each Warrant and the Warrant Price of such shares
shall be subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the shares of
Common Stock contained in this Section 5.1

         5.2. Liquidation, Dissolution or Winding Up. Notwithstanding any other
provisions hereof, in the event of the liquidation, dissolution, or winding up
of the affairs of the Bank (other than in connection with a merger or sale or
conveyance of all or substantially all of its assets outside of the ordinary
course of business), the right to exercise each Warrant shall terminate and
expire at the close of business on the last full business day before the
earliest date fixed for the payment of any distributable amount on the Common
Stock. The Bank shall cause a notice to be mailed to each Holder at least 20
days prior to the applicable record date for such payment stating the date on
which such liquidation, dissolution or winding up is expected to become
effective, and the date on which it is expected that holders of shares of Common
Stock of record shall be entitled to exchange their shares of Common Stock for
securities or other property or assets (including cash) deliverable upon such
liquidation, dissolution or winding up, and that each Holder may exercise
outstanding Warrants during such 20 day period and, thereby, receive
consideration in the liquidation on the same basis as other previously
outstanding shares of the same class as the shares acquired upon exercise. The
Bank's failure to give notice required by this Section 5.2 or any defect therein
shall not affect the validity of such liquidation, dissolution or winding up.

         5.3. Merger, Consolidation, etc.

                  (a) In case of any merger of the Bank into any other entity or
sale or conveyance of all or substantially all of its assets outside of the
ordinary course of business (such merger, sale or conveyance, a "Change") then,
as a condition of such Change, lawful and adequate provisions shall be made
whereby the Holders shall thereafter have the right to receive upon payment of
the Warrant Price in effect immediately prior to such Change, upon the basis and
upon the terms and conditions specified in this Agreement (including but not
limited to all provisions contained in this Section 5), and in lieu of the
shares of the Bank's Common Stock purchasable upon the exercise of the Warrants,
such shares of stock, securities, cash or assets which such Holder would have
been entitled to receive after the happening of such Change had such Warrant
been exercised immediately prior to such Change. The provisions of this Section
5.3 shall similarly apply to successive Changes. The Bank shall cause a notice
to be mailed to each Holder at least 20 days prior to the applicable record date
for the Change covered by this Section 5.3(a) and shall provide notice of the
Change and shall set forth the first and last date on which the Holder may

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exercise outstanding Warrants. The Bank's failure to give the notice required by
this Section 5.3(a) or any defect therein shall not affect the validity of the
Change covered by this Section 5.3(a).

                  (b) Notwithstanding the foregoing, if as a result of such
Change, holders of the Bank Common Stock shall receive consideration other than
solely in shares of stock or other securities in exchange for their Bank Common
Stock, the Bank may, at its option, fulfill its obligation hereunder by causing
the Notice required by Section 5.3(a) hereof to include notice to Holders of the
opportunity to exercise their Warrants before the applicable record date for the
Change, and thereby receive consideration in the Change, on the same basis as
other previously outstanding shares of the same class as the shares acquired
upon exercise. If the notice specified in the preceding sentence is provided to
Holders, Warrants not exercised in accordance with this Section 5.3(b) before
consummation of the Change shall be cancelled and become null and void on the
effective date of the Change. The notice provided by the Transfer Agent pursuant
to this Section 5.3(b) shall include a description of the terms of this
Agreement providing for cancellation of the Warrants in the event that Warrants
are not exercised by the prescribed date. The Bank's failure to give any notice
required by this Section 5.3(b) or any defect therein shall not affect the
validity of any such Change.

         5.4. Duty to Make Fair Adjustments in Certain Cases. If any event
occurs as to which in the opinion of the Board of Directors of the Bank the
other provisions of this Section 5 are not strictly applicable or if strictly
applicable would not fairly protect the purchase rights of the Holders in
accordance with the essential intent and principles of this Agreement, then the
Board of Directors shall make an adjustment in the application of such
provisions, in accordance with such essential intent and principles, as to
protect the purchase rights of the Holders. Notwithstanding the foregoing, the
issuance of Common Stock or any securities convertible into Common Stock by the
Bank either for cash or in a merger, consolidation, exchange or acquisition
shall not, by itself, constitute a basis for requiring any adjustment in the
Warrants unless specifically enumerated herein.

         5.5. Good Faith Determination. Any determination as to whether an
adjustment or limitation of exercise is required pursuant to this Section 5 (and
the amount of any adjustment), shall be binding upon the Holders and the Bank if
made in good faith by the Board of Directors of the Bank.

         5.6. Notice of Adjustment. Whenever the number of shares of Common
Stock purchasable upon the exercise of the Warrants or the Warrant Price is
adjusted, the Bank shall promptly file in the custody of its Secretary or an
Assistant Secretary at its principal office and with the Transfer Agent, an
officer's certificate setting forth the number of shares of Common Stock
purchasable upon the exercise of the Warrants, the Warrant Price after such
adjustment, a statement, in reasonable detail, of the facts requiring such
adjustment and the computation by which such adjustment was made. Each such
officer's certificate shall be made available at all reasonable times for
inspection by the Warrant Holders, and the Transfer Agent shall, forthwith after
each such adjustment, promptly mail a copy of such certificate to such Holders
by first class mail, postage prepaid.

         5.7. No Change of Warrant Necessary. Irrespective of any adjustment in
the Warrant Price or in the number or kind of shares issuable upon exercise of
the Warrants, the Warrant Certificates may continue to express the same price
and number and kind of shares as are stated in the Warrant Certificates as
initially issued.

         6. SHARES TO BE FULLY PAID; RESERVATION OF SHARES. The Bank covenants
and agrees for the benefit of the Holders:

                  6.1. That all shares of Common Stock which may be issued upon
the exercise of the rights represented by the Warrant Certificates will, upon
issue and payment of the aggregate Warrant Price therefor, be duly authorized,
validly issued, fully paid and non-assessable (other than as provided under
North Carolina law) and free and clear of all liens and encumbrances, with no
personal liability attaching to the ownership thereof.

                  6.2. That during the period within which the rights
represented by the Warrant Certificates may be exercised, the Bank will at all
times have authorized and reserved for the purpose of issue upon exercise of the
rights evidenced by the Warrant Certificates, a sufficient number of shares of
Common Stock to provide for the exercise of the rights represented by the
Warrant Certificates.

                  6.3. That the Bank will take all such action as may be
necessary to ensure that the shares of Common Stock issuable upon the exercise
of the Warrants may be so issued without violation of any applicable federal or
state law or regulation.

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                  6.4. That the Bank qualifies for an exemption from the
registration requirements of the Securities Act of 1933 and has made all
appropriate filings with and received approvals from, state and federal banking
regulatory authorities with respect to Warrants and the Common Stock issuable
thereunder.

                  6.5 Notwithstanding anything in this agreement to the
contrary, in connection with the formation of a financial holding company
pursuant to the Agreement and Plan of Reorganization and Share Exchange (the
"Plan of Reorganization") dated January 16, 2001, between the Bank and Gateway
Financial Corporation ("Holding Company"), the following shall apply:

         (i) No notice need be given in advance to the Warrant Holders by the
         Bank or the Warrant Agent; and

         (ii) The Holding Company shall assume the liabilities and obligations
         of the Bank hereunder by written instrument executed among the Bank,
         the Holding Company and the Transfer Agent; and

         (iii) The Holding Company shall register under the Securities Act of
         1933 the Holding Company common stock issuable upon exercise of the
         Warrants, immediately upon consummation of the Plan of Reorganization,
         and shall register or qualify such common stock in every state where
         such registration or qualification shall be required under the
         applicable state securities or Blue Sky laws; and

         (iv) The Holding Company shall use its best efforts to list the
         Warrants for trading on the Nasdaq SmallCap Market, as soon as the
         Warrants may be transferred separately from the Holding Company common
         stock.

         7. LOSS OF WARRANT CERTIFICATE. Upon receipt by the Transfer Agent of
evidence satisfactory to it of the loss, theft, destruction or mutilation of a
Warrant Certificate, and (i) in the case of such loss, theft or destruction, of
reasonably satisfactory indemnification and bonding, or (ii) if mutilated, upon
surrender and cancellation of such Warrant Certificate, the Transfer Agent shall
execute and deliver a new Warrant Certificate of like tenor. Any such new
Warrant Certificate executed and delivered shall constitute an additional
contractual obligation on the part of the Bank, whether or not the Warrant
Certificate so lost, stolen, destroyed or mutilated shall be at any time
enforceable by anyone.

         8. NO ISSUANCE OF FRACTIONAL INTERESTS IN COMMON STOCK. The Bank shall
not be required to issue fractional shares of Common Stock on the exercise of
the Warrants. If any fraction of a share of Common Stock would be issuable upon
the exercise of the Warrants (or any specified portion thereof), the Bank shall
pay an amount in cash equal to the product of (a) such fraction and (b) the fair
market value of the Common Stock, as determined in good faith by the Board of
Directors of the Bank, on the Business Day prior to the date the warrant is
exercised.

         9. NO RIGHTS AS STOCKHOLDERS; CERTAIN NOTICES AND REPORTS TO HOLDERS.
Except as specifically provided in this Agreement, nothing contained in this
Agreement or in the Warrant Certificates shall be construed as conferring upon
the Holders or any transferees the right to vote or to receive dividends or to
receive notice as stockholders in respect of any meeting of stockholders for the
election of directors of the Bank or any other matter, or any rights whatsoever
as stockholders of the Bank. If, however, between the date hereof and the
Expiration Date (or if earlier the occurrence of any event specified in Section
5.2 or 5.3(b) terminating the Warrants), any of the following events shall
occur:

                           (a) the Bank shall declare any cash dividend upon its
         shares of Common Stock payable at a rate more than 50% in excess of the
         rate of the last cash dividend theretofore paid; or

                           (b) the Bank shall declare any dividend payable in
         any securities upon its shares of Common Stock, other than a dividend
         payable in Common Stock or make any distribution (other than a regular
         cash dividend out of undistributed net income) to the holders of its
         shares of Common Stock; or

                           (c) the Bank shall distribute any rights, options or
         warrants to the holders of shares of Common Stock; or

                           (d) a capital reorganization or reclassification of
         the Bank's capital stock shall be proposed;

then in any one or more of said events, the Bank shall give to the Holders at
least twenty days prior written notice of

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the date fixed as a record date or the date of closing the transfer books for
the determination of the stockholders entitled to receive such dividend or
distribution. Any such notice shall also specify, in the case of any such
dividend or distribution, the date on which holders of shares of Common Stock
are entitled thereto. Failure to mail such notice or any defect therein or in
the mailing thereof shall not affect the validity of any action taken in
connection with such dividend or distribution.

         The Bank shall transmit by mail to all registered Holders, all reports
and other documents that the Bank transmits to holders of shares of Common Stock
generally, at the same time and in the same manner as such reports and other
documents are transmitted to holders of shares of Common Stock.

         10. AGREEMENT OF WARRANT HOLDERS. Every Holder of a Warrant, by his
acceptance thereof, consents and agrees with the Bank, the Transfer Agent and
every other Holder of a Warrant that:

                           (a) Warrants are not transferable except as provided
         herein; and

                           (b) The Bank and the Transfer Agent may deem and
         treat the person in whose name the Warrant Certificate is registered as
         the Holder and as the absolute, true and lawful owner of the Warrants
         represented thereby for all purposes, and neither the Bank nor the
         Transfer Agent shall be affected by any notice or knowledge to the
         contrary.

         11. DUTIES OF TRANSFER AGENT. The Transfer Agent acts hereunder as
agent and in a ministerial capacity for the Bank, and its duties shall be
determined solely by the provisions hereof. The Transfer Agent shall not, by
issuing and delivering Warrant Certificates or by any other act hereunder be
deemed to make any representations as to the validity, value or authorization of
the Warrant Certificates or the Warrants represented thereby or of any
securities or other property delivered upon exercise of any Warrant or whether
any stock issued upon exercise of any Warrant is fully paid and nonassessable.

                  The Transfer Agent shall not at any time be under any duty or
responsibility to any Holder of Warrant Certificates to make or cause to be made
any adjustment of the Warrant Price provided in this Agreement, or to determine
whether any fact exists which may require any such adjustments, or with respect
to the nature or extent of any such adjustment, when made, or with respect to
the method employed in making the same. It shall not (i) be liable for any
recital or statement of facts contained herein or for any action taken, suffered
or omitted by it in reliance on any Warrant Certificate or other document or
instrument believed by it in good faith to be genuine and to have been signed or
presented by the proper party or parties, (ii) be responsible for any failure on
the part of the Bank to comply with any of its covenants and obligations
contained in this Agreement or in any Warrant Certificate, or (iii) be liable
for any act or omission in connection with this Agreement except for its own
gross negligence or willful misconduct.

                  The Transfer Agent may at any time consult with counsel
satisfactory to it (who may be counsel for the Bank) and shall incur no
liability or responsibility for any action taken, suffered or omitted by it in
good faith in accordance with the opinion or advice of such counsel.

                  Any notice, statement, instruction, request, direction, order
or demand of the Bank shall be sufficiently evidenced by an instrument signed by
the President, any Vice President, its Secretary, or Assistant Secretary,
(unless other evidence in respect thereof is herein specifically prescribed).
The Transfer Agent shall not be liable for any action taken, suffered or omitted
by it in accordance with such notice, statement, instruction, request,
direction, order or demand believed by it to be genuine.

                  The Bank agrees to pay the Transfer Agent reasonable
compensation for its services hereunder and to reimburse it for its reasonable
expenses hereunder and further agrees to indemnify the Transfer Agent and save
it harmless against any and all losses, expenses and liabilities, including
judgments, reasonable costs and counsel fees, for anything done or omitted by
the Transfer Agent in the execution of its duties and powers hereunder except
losses, expenses and liabilities arising as a result of the Transfer Agent's
gross negligence or willful misconduct.

                  The Transfer Agent may resign its duties and be discharged
from all further duties and liabilities hereunder (except liabilities arising as
a result of the Transfer Agent's own gross negligence or willful misconduct),
after giving 30 days' prior written notice to the Bank. At least 15 days prior
to the date such resignation is to become effective, the Transfer Agent shall
cause a copy of such notice of resignation to be mailed to the Holder of each

<PAGE>   7

Warrant Certificate at the Bank's expense. Upon such resignation, or any
inability of the Transfer Agent to act as such hereunder, the Bank shall appoint
a new Transfer Agent in writing. The Bank shall have complete discretion in the
naming of a new Transfer Agent, who may be an affiliate, subsidiary or
department of the Bank, or any person used by the Bank as transfer agent for the
Common Stock. If the Bank shall fail to make such appointment within a period of
15 days after it has been notified in writing of such resignation by the
resigning Transfer Agent, then the Holder of any Warrant Certificate may apply
to any court of competent jurisdiction for the appointment of a new Transfer
Agent.

                  The Bank may, upon notice to the Holders, remove and replace
the Transfer Agent for the Bank Common Stock for any reason.

                  After acceptance in writing of an appointment by a new
transfer agent is received by the Bank, such new transfer agent shall be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named herein as the Transfer Agent, without any further assurance,
conveyance, act or deed. Any former Transfer Agent hereby agrees to cooperate
with and deliver all records and Warrant Certificates to the new transfer agent
at the direction of the new agent and the Bank.

                  Not later than the effective date of an appointment of a new
transfer agent by the Bank, the Bank shall file notice with the resigning or
terminated Transfer Agent and shall forthwith cause a copy of such notice to be
mailed to each Holder.

                  Any corporation into which the Transfer Agent or any new
transfer agent may be converted or merged or any corporation resulting from any
consolidation to which the Transfer Agent or any new transfer agent shall be a
party or any corporation succeeding to the trust business of the Transfer Agent
shall be a successor transfer agent under this Agreement without any further
act. Any such successor transfer agent shall promptly cause notice of its
succession as transfer agent to be mailed to the Bank and to each Holder.

                  Nothing herein shall preclude the Transfer Agent from acting
in any other capacity for the Bank.

         12. MODIFICATION OF AGREEMENT. The Transfer Agent and the Bank may by
supplemental agreement make any changes or corrections in this Agreement: (i)
that they shall deem appropriate to cure any ambiguity or to correct any
defective or inconsistent provision or manifest mistake or error herein
contained; or (ii) that they may deem necessary or desirable and which shall not
adversely affect the purchase or other material rights of the Holders of Warrant
Certificates. This Agreement shall not otherwise be modified, supplemented or
amended in any respect except with the consent in writing of the Holders of
Warrant Certificates representing not less than 50% of the Warrants then
outstanding, but no such amendment, modification or supplement which changes the
number or nature of the securities purchasable upon the exercise of any Warrant,
the Warrant Price or accelerates the Expiration Date, shall be made without the
consent in writing of each and every Holder (but no consent shall be required
for such changes as are specifically prescribed by this Agreement as originally
executed).

         13. MISCELLANEOUS.

                           13.1. Entire Agreement. This Agreement and the form
         of Warrant Certificate annexed hereto as Exhibit A contains the entire
         Agreement between the parties hereto with respect to the transactions
         contemplated by this Agreement and supersedes all prior negotiations,
         arrangements or understandings with respect thereto.

                           13.2. Counterparts. This Agreement may be executed in
         one or more counterparts, all of which shall be considered one and the
         same agreement and each of which shall be deemed an original.

                           13.3. Governing Law. This Agreement shall be governed
         by the laws of the State of North Carolina, without giving effect to
         the principles of conflicts of laws thereof.

                           13.4. Descriptive Headings. The descriptive headings
         of this Agreement are for convenience only and shall not control or
         affect the meaning or construction of any provision of this Agreement.

                           13.5. Notices. Any notice or other communications
         required hereunder to be given to a Holder shall be in writing and
         shall be sufficiently given, if mailed (first class, postage prepaid),
         or personally delivered, addressed in the name and at the address of
         such Holder appearing from time to time on the records of the Transfer
         Agent. Notices or other communications to the Bank shall be deemed to

<PAGE>   8

         have been sufficiently given if delivered by hand or mailed to the Bank
         at its then principal office, Attention: President, or at such other
         address as the Bank shall have designated by written notice to the
         Transfer Agent. Notices or other communications to the Transfer Agent
         shall be deemed to have been sufficiently given if delivered by hand or
         mailed (first class, postage prepaid) to its then principal office.
         Notice by mail shall be deemed given when deposited in the mail,
         postage prepaid.

                           13.6 Successors and Assigns. The terms and conditions
         of this Agreement shall inure to the benefit of and be binding upon the
         respective successors and assigns of the Bank and the Transfer Agent.

                  IN WITNESS WHEREOF, the Bank and the Transfer Agent have
         executed this Agreement by their duly authorized officers as of the
         date first set forth above.

                                         Gateway Bank & Trust Co.

[Corporate Seal]
                                         By: /s/ Daniel B. Berry
                                             --------------------

                                         Daniel B. Berry
                                         President and Chief Executive Officer

                                         SunTrust Banks, Inc.

[Corporate Seal]
                                         By:  /s/ Sue Hampton
                                           -------------------

                                         Sue Hampton
                                         Vice President<PAGE>   1
                                                                    EXHIBIT 4.5

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

                        AMENDED AND RESTATED DECLARATION

                                    OF TRUST

                        TBC CAPITAL STATUTORY TRUST III

                           Dated as of July 16, 2001

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

<PAGE>   2
                               TABLE OF CONTENTS

<Table>
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                                                     ARTICLE I
                                            INTERPRETATION AND DEFINITIONS

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

                                                     ARTICLE II
                                                    ORGANIZATION

Section 2.1        Name..........................................................................    9

Section 2.2        Office........................................................................    9

Section 2.3        Purpose.......................................................................    9

Section 2.4        Authority.....................................................................    9

Section 2.5        Title to Property of the Trust................................................   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..........................   14

Section 2.8        Powers and Duties of the Institutional Trustee................................   14

Section 2.9        Certain Duties and Responsibilities of the Trustees and Administrators........   16

Section 2.10       Certain Rights of Institutional Trustee.......................................   18

Section 2.11       Delaware Trustee..............................................................   20

Section 2.12       Execution of Documents........................................................   20

Section 2.13       Not Responsible for Recitals or Issuance of Securities........................   20

Section 2.14       Duration of Trust.............................................................   20

Section 2.15       Mergers.......................................................................   21

                                                     ARTICLE III
                                                       SPONSOR

Section 3.1        Sponsor's Purchase of Common Securities.......................................   22

Section 3.2        Responsibilities of the Sponsor...............................................   22

                                                     ARTICLE IV
                                             TRUSTEES AND ADMINISTRATORS

Section 4.1        Number of Trustees............................................................   23

Section 4.2        Delaware Trustee..............................................................   23

Section 4.3        Institutional Trustee; Eligibility............................................   24

Section 4.4        Certain Qualifications of the Delaware Trustee Generally......................   24

Section 4.5        Administrators................................................................   24

Section 4.6        Initial Delaware Trustee......................................................   25
</Table>

                                      (i)
<PAGE>   3
<Table>
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Section 4.7       Appointment, Removal and Resignation of Trustees and Administrators............. 25

Section 4.8       Vacancies Among Trustees........................................................ 27

Section 4.9       Effect of Vacancies............................................................. 27

Section 4.10      Meetings of the Trustees and the Administrators................................. 27

Section 4.11      Delegation of Power............................................................. 27

Section 4.12      Conversion, Consolidation or Succession to Business............................. 28

                                              ARTICLE V
                                            DISTRIBUTIONS

Section 5.1       Distributions................................................................... 28

                                             ARTICLE VI
                                       ISSUANCE OF SECURITIES

Section 6.1       General Provisions Regarding Securities......................................... 28

Section 6.2       Paying Agent, Transfer Agent, Calculation Agent and Registrar................... 29

Section 6.3       Form and Dating................................................................. 30

Section 6.4       Mutilated, Destroyed, Lost or Stolen Certificates............................... 30

Section 6.5       Temporary Securities............................................................ 31

Section 6.6       Cancellation.................................................................... 31

Section 6.7       Rights of Holders; Waivers of Past Defaults..................................... 31

                                             ARTICLE VII
                                DISSOLUTION AND TERMINATION OF TRUST

Section 7.1       Dissolution and Termination of Trust............................................ 33

                                            ARTICLE VIII
                                        TRANSFER OF INTERESTS

Section 8.1       General......................................................................... 34

Section 8.2       Transfer Procedures and Restrictions............................................ 35

Section 8.3       Deemed Security Holders......................................................... 37

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

Section 9.1       Liability....................................................................... 37

Section 9.2       Exculpation..................................................................... 38

Section 9.3       Fiduciary Duty.................................................................. 38

Section 9.4       Indemnification................................................................. 39

Section 9.5       Outside Businesses.............................................................. 41
</Table>

                                      (ii)

<PAGE>   4
<Table>
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<S>            <C>                                                                <C>
Section 9.6    Compensation; Fee................................................. 42

                                            ARTICLE X
                                            ACCOUNTING

Section 10.1   Fiscal Year....................................................... 42

Section 10.2   Certain Accounting Matters........................................ 42

Section 10.3   Banking........................................................... 43

Section 10.4   Withholding....................................................... 43

                                           ARTICLE XI
                                    AMENDMENTS AND MEETINGS

Section 11.1   Amendments........................................................ 44

Section 11.2   Meetings of the Holders of Securities; Action by Written Consent.. 46

                                           ARTICLE XII
                 REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE

Section 12.1   Representations and Warranties of Institutional Trustee........... 47

Section 12.2   Representations and Warranties of Delaware Trustee................ 48

                                          ARTICLE XIII
                                         MISCELLANEOUS

Section 13.1   Notices........................................................... 49

Section 13.2   Governing Law..................................................... 50

Section 13.3   Submission to Jurisdiction........................................ 50

Section 13.4   Intention of the Parties.......................................... 51

Section 13.5   Headings.......................................................... 51

Section 13.6   Successors and Assigns............................................ 51

Section 13.7   Partial Enforceability............................................ 51

Section 13.8   Counterparts...................................................... 51

ANNEXES AND EXHIBITS

ANNEX I             Terms of Floating Rate MMCapS(SM)

EXHIBIT A-1         Form of Capital Securities Certificate
EXHIBIT A-2         Form of Common Security Certificate
EXHIBIT B           Form of Transferee Certificate to be Executed by Transferees
                    Other than QIBs
EXHIBIT C           Form of Transferee Certificate to be Executed for QIBs
</Table>

                                     (iii)

<PAGE>   5
                   AMENDED AND RESTATED DECLARATION OF TRUST

                                       OF

                        TBC CAPITAL STATUTORY TRUST III

                                 July 16, 2001

         AMENDED AND RESTATED DECLARATION OF TRUST (this "Declaration") dated
and effective as of July 16, 2001, 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, the Administrators and the Sponsor
established TBC Capital Statutory Trust III (the "Trust"), a statutory business
trust under the Business Trust Act (as defined herein) pursuant to a
Declaration of Trust dated as of June 27, 2001 (the "Original Declaration"), and
a Certificate of Trust filed with the Secretary of State of the State of
Delaware on June 27, 2001, for the sole purpose of issuing and selling certain
securities representing undivided beneficial interests in the assets of the
Trust and investing the proceeds thereof in certain debentures of the Debenture
Issuer (as defined herein) in connection with the MMCapS(SM) Transaction;

         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 business trust under the Business Trust Act
and that this Declaration constitutes the governing instrument of such
statutory business trust, the Trustees declare that all assets contributed to
the Trust will be held in trust for the benefit of the holders, from time to
time, of the securities representing undivided beneficial interests in the
assets of the Trust issued hereunder, subject to the provisions of this
Declaration.

                                   ARTICLE I

                         INTERPRETATION AND DEFINITIONS

         Section 1.1       Definitions

         Unless the context otherwise requires:

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

<PAGE>   6

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

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

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

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

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

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

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

         "Administrators" means each of David R. Carter and James A. Taylor,
Jr., solely in such Person's capacity as Administrator of the Trust created and
continued hereunder and not in such Person's individual capacity, or such
Administrator's successor in interest in such capacity, or any successor
appointed as herein provided.

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

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

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

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

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

                                       2
<PAGE>   7

         "Business Day" means any day other than Saturday, Sunday or any other
day on which banking institutions in New York City or Birmingham, Alabama are
permitted or required by any applicable law to close.

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

         "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
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 Placement Agreement.

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

         "Commission" means the Securities and Exchange Commission.

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

         "Common Security Certificate" means a definitive Certificate
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.

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

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

         "Corporate Trust Office" means the office of the Institutional Trustee
at which the corporate trust business of the Institutional Trustee shall, at
any particular time, be principally administered, which office shall at all
times be located in the United States and at the date of

                                       3
<PAGE>   8

execution of this Declaration is located at 101 Barclay Street, Floor 21 West,
New York, NY 10286.

         "Coupon Rate" has the meaning set forth in paragraph 2(a) of Annex 1.

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

         "Debenture Issuer" means The Banc Corporation, a financial holding
company incorporated in Delaware, in its capacity as issuer of the Debentures
under the Indenture.

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

         "Debentures" means the Floating Rate Junior Subordinated Deferrable
Interest Debentures due July 25, 2031 to be issued by the Debenture Issuer
under the Indenture.

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

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

         "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(b) of
Annex I.

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

                                       4
<PAGE>   9

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

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

         "Guarantee" means the guarantee agreement to be dated as of July 16,
2001, of the Sponsor in respect of the Capital Securities.

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

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

         "Indenture" means the Indenture dated as of July 16, 2001, among the
Debenture Issuer and the Debenture Trustee, and any indenture supplemental
thereto pursuant to which the Debentures are to be issued.

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

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

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

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

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

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

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

         "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.

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

                                       5
<PAGE>   10

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

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

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

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

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

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

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

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

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

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

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

         "Placement Agreement" means the Placement Agreement relating to the
offering and sale of Capital Securities.

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

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

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

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

                                       6
<PAGE>   11
                  "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.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

                  "Securities Act" means the Securities Act of 1933, as
amended.

                  "Sponsor" means The Banc Corporation, a financial holding
company that is a U.S. Person incorporated in Delaware, or any successor entity
in a merger, consolidation or amalgamation that is a U.S. Person, in its
capacity as sponsor of the Trust.

                                       7
<PAGE>   12

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

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

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

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

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

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

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

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

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

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

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

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

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

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

                                       8
<PAGE>   13

                                   ARTICLE II

                                  ORGANIZATION

                  Section 2.1       Name.

                  The Trust is named "TBC Capital Statutory Trust III." as such
name may be modified from time to time by the Administrators following written
notice to the Holders of the Securities. The Trust's activities may be
conducted under the name of the Trust or any other name deemed advisable by the
Administrators.

                  Section 2.2       Office.

                  The address of the principal office of the Trust, which shall
be in a State of the United States or the District of Columbia, is c/o The Banc
Corporation, 17 North 20th Street, Birmingham, Alabama 35203. On ten Business
Days written notice to the Holders of the Securities, the Administrators may
designate another principal office, which shall be in a State of the United
States or the District of Columbia.

                  Section 2.3       Purpose.

                  The exclusive purposes and functions of the Trust are (a) to
issue and sell the Securities representing undivided beneficial interests in
the assets of the Trust, (b) to invest the gross proceeds from such sale to
acquire the Debentures and (c) except as otherwise limited herein, to engage in
only those other activities incidental thereto that are deemed necessary or
advisable 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 its powers shall constitute the act of and serve to bind
the Trust. In dealing with the Trustees acting on behalf of the Trust, no
Person shall be required to inquire into the authority of the Trustees to bind
the Trust. Persons dealing with the Trust are entitled to rely conclusively on
the power and authority of the Trustees as set forth in this Declaration. The
Administrators shall have only those ministerial duties set forth herein with
respect to accomplishing the purposes of the Trust and are not intended to be
trustees or fiduciaries with respect to the Trust or the Holders. The
Institutional Trustee shall have the right, but shall not be obligated except
as provided in Section 2.6, to perform those duties assigned to the
Administrators.

                                       9
<PAGE>   14

                  Section 2.5       Title to Property of the Trust.

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

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

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

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

                           (A)      the issuance and sale of the Securities;

                           (B)      to cause the Trust to enter into, and to
                  execute, 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;

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

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

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

                           (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 Placement Agreement and the
                  application for a taxpayer identification number;

                                       10
<PAGE>   15

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

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

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

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

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

                           (A)      the establishment of the Property Account;

                           (B)      the receipt of the Debentures;

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

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

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

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

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

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

                                       11
<PAGE>   16

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

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

                  (iii)    The Institutional Trustee shall have the power and
         authority to act on behalf of the Trust with respect to any of the
         duties, liabilities, powers or the authority of the Administrators set
         forth in Section 2.6(a)(i)(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 the Trust to
fail or cease to qualify as a "grantor trust" for United States federal income
tax purposes, (iv) incur any indebtedness for borrowed money or issue any other
debt or (v) take or consent to any action that would result in the placement of
a lien on any of the Trust Property. The Institutional Trustee shall, at the
sole cost and expense of the Trust, defend all claims and demands of all
Persons at any time claiming any lien on any of the Trust Property adverse to
the interest of the Trust or the Holders in their capacity as Holders.

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

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

                  (ii)     the determination of the States in which to take
         appropriate action to qualify or register for sale all or part of the
         Capital Securities and the determination of any and all such acts,
         other than actions which must be taken by or on behalf of the Trust,
         and the

                                       12
<PAGE>   17

         advisement of the Trustees of actions they must take on behalf of the
         Trust, and the preparation for execution and filing of any documents to
         be executed and filed by the Trust or on behalf of the Trust, as the
         Sponsor deems necessary or advisable in order to comply with the
         applicable laws of any such States in connection with the sale of the
         Capital Securities;

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

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

                  (d)      Notwithstanding anything herein to the contrary, the
Administrators, 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, and (ii) the Trust will not fail to be
classified as a grantor trust for United States federal income tax purposes 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 this connection, the Institutional Trustee and the
Holders of a Majority in liquidation amount of the Common Securities are
authorized to take any action, not inconsistent with applicable laws, the
Original Declaration or this Declaration, as amended from time to time, that
each of the Institutional Trustee 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.

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

                  (g)      Legal title to all Trust Property shall be vested at
all times in the Institutional Trustee (in its capacity as such) and shall be
held and administered by the Institutional Trustee for the benefit of the Trust
and neither the Administrators nor the Holders in accordance with this
Declaration.

                  (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.

                                       13
<PAGE>   18

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

                  (a)      The Trust shall not, and the Institutional Trustee
and the Administrators shall not, cause the Trust 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:

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

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

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

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

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

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

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

                  Section 2.8       Powers and Duties of the Institutional
Trustee.

                  (a)      The legal title to the Debentures shall be owned by
and held of record in the name of the Institutional Trustee in trust for the
benefit of the Trust. The right, title and interest of the Institutional
Trustee to the Debentures shall vest automatically in each Person who may
hereafter be appointed as Institutional Trustee in accordance with Section 4.7.
Such vesting and cessation of title shall be effective whether or not
conveyancing documents with regard to the Debentures have been executed and
delivered.

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

                                       14
<PAGE>   19

                  (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 certain circumstances pursuant to the terms of
         the Securities.

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

                  (e)      The Institutional Trustee may bring or defend, pay,
collect, compromise, arbitrate, resort to legal action with respect to, or
otherwise adjust claims or demands of or against, the Trust (a "Legal Action")
which arises out of or in connection with an Event of Default of which a
Responsible Officer of the Institutional Trustee has actual knowledge or the
Institutional Trustee's duties and obligations under this Declaration or the
Trust Indenture Act; provided, however, that if an Event of Default has
occurred and is continuing and such event is attributable to the failure of the
Debenture Issuer to pay interest or principal on the Debentures on the date
such interest or principal is otherwise payable (or in the case of redemption,
on the redemption date), then a Holder of the Capital Securities may directly
institute a proceeding for enforcement of payment to such Holder of the
principal of or interest on the Debentures having a principal amount equal to
the aggregate liquidation amount of the Capital Securities of such Holder (a
"Direct Action") on or after the respective due date specified in the
Debentures. In connection with such Direct Action, the rights of the Holders of
the Common Securities will be subrogated to the rights of such Holder of the
Capital Securities to the extent of any payment made by the Debenture Issuer to
such Holder of the Capital Securities in such Direct Action; provided, however,
that a Holder of the Capital Securities may exercise such right of subrogation
only so long as an Event of Default with respect to the Capital Securities has
occurred and is continuing.

                                       15
<PAGE>   20

                  (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 4.7.

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

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

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

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

                  (b)      The duties and responsibilities of the Trustees and
the Administrators shall be as provided by this Declaration and, in the case of
the Institutional Trustee, by the Trust Indenture Act. Notwithstanding the
foregoing, no provision of this Declaration shall require the Trustees or
Administrators to expend or risk their own funds or otherwise incur any
financial liability in the performance of any of their duties hereunder, or in
the exercise of any of their rights or powers, if they 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 Administrators shall be subject to the provisions
of this Article. Nothing in this Declaration shall be construed to release an
Administrator or Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct. To the extent that, at
law or in equity, a Trustee or an Administrator has duties and liabilities
relating to the Trust or to the Holders, such Trustee or Administrator shall
not be liable to the Trust or to any Holder for such Trustee's or
Administrator's good faith reliance on the provisions of this Declaration. The

                                       16
<PAGE>   21
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 with respect to matters
that are within the authority of the Institutional Trustee under this
Declaration for its own negligent action, its own negligent failure to act, or
its own willful misconduct, except that:

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

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

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

                  (iv)     the Institutional Trustee shall not be liable for
         any interest on any money received by it except as it may otherwise
         agree in writing with the Sponsor; and money held by the Institutional
         Trustee need not be segregated from other funds held by it except in
         relation to the Property Account maintained by the Institutional
         Trustee pursuant to Section 2. 8(c)(i) and except to the extent
         otherwise required by law; and

                                       17
<PAGE>   22

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

                  Section 2.10      Certain Rights of Institutional Trustee.

                  Subject to the provisions of Section 2.9:

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

                  (b)      if (i) in performing its duties under this
Declaration, the Institutional Trustee is required to decide between
alternative courses of action, (ii) in construing any of the provisions of this
Declaration, the Institutional Trustee finds the same ambiguous or inconsistent
with any other provisions contained herein, or (iii) the Institutional Trustee
is unsure 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 or willful misconduct;

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

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

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

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

                                       18
<PAGE>   23

                  (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 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) 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;

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

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

                                       19
<PAGE>   24

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

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

                  Section 2.11      Delaware Trustee.

                  Notwithstanding any other provision of this Declaration other
than Section 4.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of any of the Trustees or the Administrators described in this
Declaration (except as may be required under the Business 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 ss. 3807 of the Business
Trust Act.

                  Section 2.12      Execution of Documents.

                  Unless otherwise determined in writing by the Institutional
Trustee, and except as otherwise required by the Business Trust Act, the
Institutional Trustee, or any one or more of the Administrators, as the case
may be, is authorized to execute on behalf of the Trust any documents that the
Trustees or the Administrators, as the case may be, have the power and
authority to execute pursuant to Section 2.6.

                  Section 2.13      Not Responsible for Recitals or Issuance of
Securities.

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

                  Section 2.14      Duration of Trust.

                  The Trust, unless dissolved pursuant to the provisions of
Article VII hereof, shall have existence for thirty-five (35) years from the
Closing Date.

                                       20
<PAGE>   25

                  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(b) and (c) and except with respect to
the distribution of Debentures to Holders of Securities pursuant to Section 7.1
(a)(iv) of the Declaration or Section 4 of Annex I.

                  (b)      The Trust may, with the consent of the Institutional
Trustee (which consent will not be unreasonably withheld) and without the
consent of the Delaware Trustee or the Holders of the Capital Securities,
consolidate, amalgamate, merge with or into, or be replaced by a trust
organized as such under the laws of any State; provided, that:

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

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

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

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

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

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

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

                                       21
<PAGE>   26

                  (vii)    prior to such merger, consolidation, amalgamation or
         replacement, 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 or
                  replacement does not adversely affect the rights, preferences
                  and privileges of the Holders of the Securities (including
                  any Successor Securities) in any material respect (other than
                  with respect to any dilution of the Holders' interest in the
                  Successor Entity);

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

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

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

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

                  (c)      Notwithstanding Section 2.15(b), the Trust shall
not, except with the consent of Holders of 100% in liquidation amount of the
Securities, consolidate, amalgamate, merge with or into, or be replaced by any
other Person or permit any other Person to consolidate, amalgamate, merge with
or into, or replace it if such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States federal income tax purposes.

                                  ARTICLE III
                                    SPONSOR

                  Section 3.1       Sponsor's Purchase of Common Securities.

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

                  Section 3.2       Responsibilities of the Sponsor.

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

                                       22
<PAGE>   27

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

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

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

                                   ARTICLE IV
                          TRUSTEES AND ADMINISTRATORS

         Section 4.1       Number of Trustees.

                  The number of Trustees initially shall be two, and:

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

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

                  Section 4.2       Delaware Trustee.

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

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

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

                                       23
<PAGE>   28

                  Section 4.3       Institutional Trustee, Eligibility.

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

                  (i)      not be an Affiliate of the Sponsor;

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

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

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

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

                  (d)      The initial Institutional Trustee shall be The Bank
of New York.

                  Section 4.4       Certain Qualifications of the Delaware
Trustee Generally.

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

                  Section 4.5       Administrators.

                  Each Administrator shall be a U.S. Person. The initial
Administrators shall be David R. Carter and James A. Taylor, Jr. 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.

                                       24
<PAGE>   29

                  Section 4.6       Initial Delaware Trustee.

                  The initial Delaware Trustee shall be the Bank of New York
(Delaware).

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

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

                  Subject to the immediately preceding paragraph, a Relevant
Trustee may resign at any time by giving written notice thereof to the Holders
of the Securities and by appointing a successor Relevant Trustee. Upon the
resignation of the Institutional Trustee, the Institutional Trustee shall
appoint a successor by requesting from at least three Persons meeting the
eligibility requirements, its expenses and charges to serve as the successor
Institutional Trustee on a form provided by the Administrators, and selecting
the Person who agrees to the lowest expense and charges (the "Successor
Institutional Trustee"). If the instrument of acceptance by the successor
Relevant Trustee required by Section 4.7 shall not have been delivered to the
Relevant Trustee within 60 days after the giving of such notice of resignation
or delivery of the instrument of removal, the Relevant Trustee may petition, at
the expense of the Trust, any Federal, State or District of Columbia court of
competent jurisdiction for the appointment of a successor Relevant Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Relevant Trustee. The Institutional Trustee shall have no
liability for the selection of such successor pursuant to this Section 4.7.

                  Unless an Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by an act of the Holder 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 then outstanding
delivered to the Relevant Trustee, shall promptly appoint a successor Relevant
Trustee or Trustees, and such successor Trustee shall comply with the
applicable requirements of this Section 4.7. If 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 Trustee shall comply with the
applicable requirements of this Section 4.7. If no successor Relevant Trustee
shall have been so appointed by the Holders of a Majority in liquidation amount
of the Capital Securities and accepted appointment in the manner required by
this Section 4.7, within 30 days after delivery of an instrument of removal,
the Relevant Trustee or any Holder who has been a Holder of the Securities for
at least six months may, on behalf of himself and all others similarly
situated, petition any Federal, State or District of Columbia court of
competent jurisdiction for the

                                       25
<PAGE>   30

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.

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

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

                  (b)      In case of the appointment hereunder of a successor
Relevant Trustee, the retiring Relevant Trustee and each successor Relevant
Trustee with respect to the 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.

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

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

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

                                       26
<PAGE>   31
                  Section 4.8       Vacancies Among Trustees.

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

                  Section 4.9       Effect of Vacancies.

                  The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
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 4.7, the Institutional Trustee shall have all the
powers granted to the Trustees and shall discharge all the duties imposed upon
the Trustees by this Declaration.

                  Section 4.10      Meeting of the Trustees and the
Administrators.

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

                  Section 4.11      Delegation of Power.

                  (a)      Any Trustee or any Administrator, as the case may
be, may, by power of attorney consistent with applicable law, delegate to any
other natural person over the age of 21

                                       27
<PAGE>   32

that is a U.S. Person his or her power for the purpose of executing any
documents contemplated in Section 2.6; and

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

                  Section 4.12      Conversion, Consolidation or Succession to
Business.

                  Any Person into which the Institutional Trustee or the
Delaware Trustee, as the case may be, may be merged or converted or with which
either may be consolidated, or any Person resulting from any merger, conversion
or consolidation to which the Institutional Trustee or the Delaware Trustee, as
the case may be, shall be a party, or any Person succeeding to all or
substantially all the corporate trust business of the Institutional Trustee or
the Delaware Trustee, as the case may be, shall be the successor of the
Institutional Trustee or the Delaware Trustee, as the case may be, hereunder,
provided such Person shall be otherwise qualified and eligible under this
Article, provided, further, that such Person shall file an amendment to the
Certificate of Trust with the Delaware Secretary of State as contemplated in
Section 4.7(e) without the execution or filing of any paper or any further act
on the part of any of the parties hereto.

                                   ARTICLE V
                                 DISTRIBUTIONS

                  Section 5.1       Distributions.

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

                                   ARTICLE VI
                             ISSUANCE OF SECURITIES

                  Section 6.1       General Provisions Regarding Securities.

                  (a)      The Administrators shall on behalf of the Trust
issue one series of capital securities substantially in the form of Exhibit A-1
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Capital Securities") and one
series of common securities representing undivided beneficial interests in the
assets of the Trust having such terms as are set forth in Annex I (the "Common
Securities"). The Trust shall issue no securities or other interests in the
assets of the Trust other than the Capital Securities and the Common
Securities. The Capital Securities rank pari passu and payment thereon shall

                                       28
<PAGE>   33

be made Pro Rata with the Common Securities except that, where an Event of
Default has occurred and is continuing, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment
of the Holders of the Capital Securities.

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

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

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

                  (e)      Every Person, by virtue of having become a Holder 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.

                  The Trust shall maintain in New York, New York, an office or
agency where the Securities may be presented for payment (the "Paying Agent"),
and an office or agency where Securities may be presented for registration of
transfer or exchange (the "Transfer Agent"). The Trust shall keep or cause to
be kept at such office or agency a register for the purpose of registering
Securities and transfers and exchanges of Securities, such register to be held
by a registrar (the "Registrar"). The Administrators may appoint the Paying
Agent, the Registrar and the Transfer Agent, and may appoint one or more
additional Paying Agents or one or more co-Registrars, or one or more
co-Transfer Agents in such other locations as it shall determine. The term
"Paying Agent" includes any additional paying agent, the term "Registrar"
includes any additional registrar or co-Registrar and the term "Transfer Agent"
includes any additional transfer agent. The Administrators may change any
Paying Agent, 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

                                       29
<PAGE>   34

Paying Agent, Transfer Agent and Registrar for the Capital Securities and the
Common Securities. The Institutional Trustee or any of its Affiliates in the
United States may act as Paying Agent, Transfer Agent or Registrar.

                  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, in its individual capacity
and not as Institutional Trustee, as Calculation Agent.

                  Section 6.3       Form and Dating.

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

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

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

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

                  (b)      there shall be delivered to the Registrar, the
Administrators and the Institutional Trustee such security or indemnity as may
be required by them to keep each of them harmless; then, in the absence of
notice that such Certificate shall have been acquired by a bona fide purchaser,
an Administrator on behalf of the Trust shall execute (and in the case of a
Capital Security Certificate, the Institutional Trustee shall authenticate) and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of like denomination. In connection with
the issuance of any new Certificate under this Section 6.4, the Registrar or
the Administrators may require the payment of a sum sufficient to cover any tax
or

                                       30
<PAGE>   35

other governmental charge that may be imposed in connection therewith. Any
duplicate Certificate issued pursuant to this Section shall constitute
conclusive evidence of an ownership interest in the relevant Securities, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.

                  Section 6.5       Temporary Securities.

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

                  Section 6.6       Cancellation.

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

                  Section 6.7       Rights of Holders; Waivers of Past
Defaults.

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

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

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

                                       31
<PAGE>   36

Institutional Trustee, the Sponsor and the Debenture Trustee, may rescind and
annul such declaration and its consequences if:

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

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

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

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

                           (D)      all sums paid or advanced by the Debenture
                  Trustee under the Indenture and the reasonable compensation,
                  expenses, disbursements and 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 nonpayment of the principal of the
         Debentures that has become due solely by such acceleration, have been
         cured or waived as provided in Section 5.07 of the Indenture.

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

                  Upon receipt by the Institutional Trustee of written notice
declaring such an acceleration, or rescission and annulment thereof, by Holders
of any part of the Capital Securities a record date shall be established for
determining Holders of outstanding Capital Securities entitled to join in such
notice, which record date shall be at the close of business on the day the
Institutional Trustee receives such notice. The Holders on such record date, or
their duly designated proxies, and only such Persons, shall be entitled to join
in such notice, whether or not such Holders remain Holders after such record
date; provided, that, unless such declaration of acceleration, or rescission
and annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day that is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written

                                       32
<PAGE>   37

notice that has been canceled pursuant to the proviso to the preceding
sentence, in which event a new record date shall be established pursuant to the
provisions of this Section 6.7.

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

                                  ARTICLE VII
                      DISSOLUTION AND TERMINATION OF TRUST

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

                  (i)      unless earlier dissolved, on July 25, 2036, 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 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;

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

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

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

                                       33
<PAGE>   38

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

                                  ARTICLE VIII
                             TRANSFER OF INTERESTS

                  Section 8.1       General.

                  (a)      Where Capital Securities are presented to the
Registrar or a co-registrar with a request to register a transfer or to
exchange them for an equal number of Capital Securities represented by
different certificates, the Registrar shall register the transfer or make the
exchange if its requirements for such transactions are met. To permit
registrations of transfer and exchanges, the Trust shall issue and the
Institutional Trustee shall authenticate Capital Securities at the Registrar's
request.

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

                  (c)      Capital Securities may only be transferred, in whole
or in part, in accordance with the terms and conditions set forth in this
Declaration and in the terms of the 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 transferee shall be
deemed not to be the holder of such Capital Securities for any purpose,
including but not limited to the receipt of Distributions on such Capital
Securities, and such transferee shall be deemed to have no interest whatsoever
in such Capital Securities.

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

                                       34
<PAGE>   39

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

                  Section 8.2       Transfer Procedures and Restrictions.

                  (a)      General. The Capital Securities shall bear the
Restricted Securities Legend, which shall not be removed unless there is
delivered to the Trust such satisfactory evidence, which may include an opinion
of counsel licensed to practice law in the State of New York, as may be
reasonably required by the Trust, that neither the legend nor the restrictions
on transfer set forth therein are required to ensure that transfers thereof
comply with the provisions of the Securities Act or that such Securities are
not "restricted" within the meaning of Rule 144 under the Securities Act. Upon
provision of such satisfactory evidence, the Institutional Trustee, at the
written direction of the Trust, shall authenticate and deliver Capital
Securities that do not bear the legend.

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

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

                  THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS 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 BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY
ONLY (A) TO THE DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER
THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY

                                       35
<PAGE>   40

BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (C) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH
(a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN "ACCREDITED
INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (D)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, SUBJECT TO THE DEBENTURE ISSUER'S AND THE TRUST'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C) OR (D) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE DECLARATION OF
TRUST, A COPY OF WHICH MAY BE OBTAINED FROM THE DEBENTURE ISSUER OR THE TRUST.
THE HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.

                  THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO
AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"),
(EACH A "PLAN"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN
ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THIS SECURITY OR ANY INTEREST THEREIN,
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 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 THEREIN WILL BE DEEMED TO HAVE
REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS NOT AN
EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO
WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING
ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY
USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE,
OR (ii) SUCH PURCHASE WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION
406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE
STATUTORY OR ADMINISTRATIVE EXEMPTION.

                                       36
<PAGE>   41
                  IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATE AND OTHER INFORMATION AS MAY
BE REQUIRED BY THE 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 FOR ANY PURPOSE, INCLUDING, BUT
NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS SECURITY, AND SUCH
PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS
SECURITY.

                  (d)      Minimum Transfers. 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 voided 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 Certificate shall be registered on the books and records of the Trust as
the sole holder of such Certificate and of the Securities represented by such
Certificate for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Certificate or in the Securities represented
by such Certificate on the part of any Person, whether or not the Trust, the
Administrators, the Trustees, the Paying Agent, the Transfer Agent or the
Registrar shall have actual or other notice thereof.

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

                  Section 9.1       Liability.

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

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

                                       37
<PAGE>   42

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

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

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

                  Section 9.2       Exculpation.

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

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

                  Section 9.3       Fiduciary Duty.

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

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

                                       38
<PAGE>   43

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

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

                  Section 9.4       Indemnification.

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

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

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

                                       39
<PAGE>   44

         expenses (including attorneys' fees and expenses) actually and
         reasonably incurred by him in connection therewith.

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

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

                  (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 performed or omitted by such Indemnified Person in good faith on
behalf of the Trust and in a manner such Indemnified Person reasonably believed
to be within the scope of authority conferred on such Indemnified Person by
this Declaration, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage, liability, tax, penalty, expense or
claim incurred by such Indemnified Person by reason of negligence or willful
misconduct with respect to such acts or omissions.

                                       40
<PAGE>   45

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

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

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

                  (f)      The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 9.4 shall, unless otherwise
provided when authorized or ratified, continue as to a Person who has ceased to
be an Indemnified Person and shall inure to the benefit of the heirs, executors
and administrators of such a Person.

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

                  Section 9.5       Outside Businesses.

                  Any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee (subject to Section 4.3(c)) may engage in or possess an
interest in other business ventures of any nature or description, independently
or with others, similar or dissimilar to the business of the Trust, and the
Trust and the Holders of Securities shall have no rights by virtue of this
Declaration in and to such independent ventures or the income or profits
derived therefrom, and the pursuit of any such venture, even if competitive
with the business of the Trust, shall not

                                       41
<PAGE>   46

be deemed wrongful or improper. None of any Covered Person, the Sponsor, the
Delaware Trustee or the Institutional Trustee shall be obligated to present any
particular investment or other opportunity to the Trust even if such
opportunity is of a character that, if presented to the Trust, could be taken
by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Covered Person, the Delaware
Trustee and the Institutional Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the
Sponsor, or may act as depositary for, trustee or agent for, or act on any
committee or body of holders of, securities or other obligations of the Sponsor
or its Affiliates.

                  Section 9.6       Compensation; Fee. The Sponsor agrees:

                  (a)      to pay to the Trustees from time to time such
compensation for all services rendered by them hereunder as the parties shall
agree 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

                  (b)      except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses, disbursements
and advances incurred or made by the Trustees in accordance with any provision
of this Declaration (including the reasonable compensation and the expenses and
disbursements of their respective agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or willful
misconduct.

                  The provisions of this Section 9.6 shall survive the
dissolution of the Trust and the termination of this Declaration and the
removal or resignation of any Trustee.

                                   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 Administrators shall either (i) cause each Form
10K and Form 10Q prepared by the Sponsor and filed with the Securities and
Exchange Commission in accordance with the Securities Exchange Act of 1934 to
be delivered to each Holder of Securities, within

                                       42
<PAGE>   47

90 days after the filing of each Form 10K and within 30 days after the filing
of each Form 10Q or (ii) cause to be prepared at the principal office of the
Trust in the United States, as defined for purposes of Treasury regulations
section 301.7701-7, and delivered to each of the Holders of Securities, within
90 days after the end of each Fiscal Year of the Trust, annual financial
statements of the Trust, including a balance sheet of the Trust as of the end
of such Fiscal Year, and the related statements of income or loss.

                  (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 the only Holder of the Capital Securities
is MM Community Funding Ltd, the Administrators will cause the Sponsor's
reports on Form FR Y-9C, FR Y-9LP and FR Y-6 to be delivered to the Holder
promptly following their filing with the Federal Reserve.

                  Section 10.3      Banking.

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

                  Section 10.4      Withholding.

                  The Institutional Trustee or any Paying Agent and the
Administrators shall comply with all withholding requirements under United
States federal, state and local law. The Institutional Trustee or any Paying
Agent shall request, and each Holder shall provide to the Institutional Trustee
or any Paying Agent, such forms or certificates as are necessary to establish
an exemption from withholding with respect to the Holder, and any
representations and forms as shall reasonably be requested by the Institutional
Trustee or any Paying Agent to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Administrators shall file required
forms with applicable jurisdictions and, unless an exemption from withholding
is properly established by a Holder, shall remit amounts withheld with respect
to the Holder to applicable jurisdictions. To the extent that the Institutional
Trustee or any Paying Agent is

                                       43
<PAGE>   48

required to withhold and pay over any amounts to any authority with respect to
distributions or allocations to any Holder, the amount withheld shall be deemed
to be a Distribution to the Holder in the amount of the withholding. In the
event of any claimed overwithholding, Holders shall be limited to an action
against the applicable jurisdiction. If the amount required to be withheld was
not withheld from actual Distributions made, the Institutional Trustee or any
Paying Agent may reduce subsequent Distributions by the amount of such
withholding.

                                   ARTICLE XI
                            AMENDMENTS AND MEETINGS

                  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 Administrator, the Administrator, and

                  (iv)     the Holder 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); 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;

                                       44
<PAGE>   49

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

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

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

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

                  (e)      Section 9.1 (b) and 9.1 (c) and this Section 11.1
shall not be amended without the consent of all of the Holders of the
Securities.

                  (f)      Article III shall not be amended without the consent
of the Holders of a Majority in liquidation amount of the Common Securities.

                  (g)      The rights of the Holders of the Capital Securities
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.

                  (h)      This Declaration may be amended by the Institutional
Trustee and the Holder of a Majority in liquidation amount of the Common
Securities without the consent of the Holders of the Capital Securities to:

                  (i)      cure any ambiguity;

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

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

                  (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,

                                       45
<PAGE>   50

         government agency or regulatory authority) which amendment does not
         have a material adverse effect on the right, preferences or privileges
         of the Holders of Securities;

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

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

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

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

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

                                       46
<PAGE>   51
         proxy. Every proxy shall be revocable at the pleasure of the Holder of
         the Securities executing it. Except as otherwise provided herein, all
         matters relating to the giving, voting or validity of proxies shall be
         governed by the General Corporation Law of the State of Delaware
         relating to proxies, and judicial interpretations thereunder, as if the
         Trust were a Delaware corporation and the Holders of the Securities
         were stockholders of a Delaware corporation; each meeting of the
         Holders of the Securities shall be conducted by the Administrators or
         by such other Person that the Administrators may designate; and

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

                                  ARTICLE XII
                    REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
                              AND DELAWARE TRUSTEE

                  Section 12.1      Representations and Warranties of
Institutional Trustee.

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

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

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

                                       47
<PAGE>   52

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

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

                  Section 12.2      Representations and Warranties of Delaware
Trustee.

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

                  (a)      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. This Declaration has been duly executed and delivered by the Delaware
Trustee, and it 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 (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 is
required for the execution, delivery or performance by the Delaware Trustee of
this Declaration; and

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

                                       48
<PAGE>   53

                                  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:

                           TBC Capital Statutory Trust III
                           c/o The Banc Corporation
                           17 North 20th  Street
                           Birmingham, Alabama 35203
                           Attention: James A. Taylor, Jr.
                           Telecopy: 205-327-3479

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

                           The Bank of New York (Delaware)
                           White Clay Center, Route 273
                           Newark, Delaware 19711
                           Attention: Corporate Trust Administration
                           Telecopy: 302-283-8279

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

                           The Bank of New York
                           101 Barclay Street, Floor 21 W
                           New York, NY 10286
                           Attention: Corporate Trust Administration
                           Telecopy: 212-815-5915

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

                           The Banc Corporation
                           17 North 20th Street
                           Birmingham, Alabama 35203
                           Attention: James A. Taylor, Jr.
                           Telecopy: 205-327-3479

                                       49
<PAGE>   54

                           With a copy to:
                           The Banc Corporation
                           17 North 20th Street
                           Birmingham, Alabama 35203
                           Attention: F. Hampton McFadden, Jr.
                           Telecopy: 205-327-3479

                  (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 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.

                  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 State 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.

                  Each of the Sponsor and the Holder of the Common Securities
irrevocably consents to the service of process on it in any such suit, action
or proceeding in any such court 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.

                                       50
<PAGE>   55

                  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.

                  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.

                                       51
<PAGE>   56

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

                                    THE BANK OF NEW YORK (DELAWARE)
                                      as Delaware Trustee

                                    By: /s/ James Longshaw
                                       ----------------------------------------
                                       Name: James Longshaw
                                       Title: SVP

                                    THE BANK OF NEW YORK
                                      as Institutional Trustee

                                    By: /s/
                                       ----------------------------------------
                                       Name: Mary
                                       Title: Vice President

                                    THE BANC CORPORATION
                                      as Sponsor

                                    By:
                                       ----------------------------------------
                                       David R. Carter
                                       Executive Vice President and
                                       Chief Financial Officer

                                    By:
                                       ----------------------------------------
                                       David R. Carter
                                       Administrator

                                    By:
                                       ----------------------------------------
                                       James A. Taylor, Jr.
                                       Administrator

<PAGE>   57

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

                                    THE BANK OF NEW YORK (DELAWARE)
                                      as Delaware Trustee

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

                                    THE BANK OF NEW YORK as
                                      Institutional Trustee

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

                                    THE BANC CORPORATION as
                                      Sponsor

                                    By: /s/ David R. Carter
                                       ----------------------------------------
                                       David R. Carter
                                       Executive Vice President and
                                       Chief Financial Officer

                                    By: /s/ David R. Carter
                                       ----------------------------------------
                                       David R. Carter
                                       Administrator

                                    By: /s/ James A. Taylor, Jr.
                                       ----------------------------------------
                                       James A. Taylor, Jr.
                                       Administrator

<PAGE>   58

                                    ANNEX I

                                    TERMS OF
                             FLOATING RATE MMCAPSSM
                        FLOATING RATE COMMON SECURITIES

                  Pursuant to Section 6.1 of the Amended and Restated
Declaration of Trust, dated as of July 16, 2001 (as amended from time to time,
the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities and the
Common Securities are set out below (each capitalized term used but not defined
herein has the meaning set forth in the Declaration):

                  1.       Designation and Number.

                  (a)      Capital Securities. 16,000 Capital Securities of TBC
Capital Statutory Trust III (the "Trust"), with an aggregate stated liquidation
amount with respect to the assets of the Trust of Sixteen Million Dollars
($16,000,000) and a stated liquidation amount with respect to the assets of the
Trust of $1,000 per Capital Security, are hereby designated for the purposes of
identification only as the "Floating Rate MMCapSsm (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. 495 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 stated liquidation amount with respect
to the assets of the Trust of Four Hundred Ninety-Five Thousand Dollars
($495,000) and a stated 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 variable per annum rate of interest, reset
semi-annually, equal to LIBOR (as defined in the Indenture) plus 3.75% (the
"Coupon Rate") of the stated liquidation amount of $1,000 per Security, such
rate being the rate of interest payable on the Debentures to be held by the
Institutional Trustee; provided, that the applicable Coupon Rate may not exceed
12.50% through the Distribution Payment Date in July 2011. Except as set forth
below in respect of an Extension Period, Distributions in arrears for more than
one semi-annual period will bear interest thereon compounded semi-annually at
the applicable Coupon Rate for each such semi-annual period (to the extent
permitted by applicable law). The term "Distributions" as used herein includes
cash distributions and any such compounded distributions payable unless
otherwise stated. A Distribution is payable only to the extent that payments
are made in respect of the Debentures held by the Institutional Trustee and to
the extent the Institutional Trustee has funds available in the Property
Account therefor. The amount of Distributions payable for any period will be
computed for any full semi-annual period on the basis of a 360-day year and the
actual number of days elapsed in the relevant period.

                                   Annex I-1
<PAGE>   59

                  (b)      LIBOR shall be determined by the Calculation Agent
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 August 1 and February 1 (except, with
         respect to the first interest payment period, on July 12, 2001), (each
         such day, a "LIBOR Determination Date"), LIBOR shall equal the rate,
         as obtained by the Calculation Agent for six-month Eurodollar deposits
         in Europe which appears on Telerate Page 3750 (as defined in the
         International Swaps and Derivatives Association, Inc. 1991 Interest
         Rate and Currency Exchange Definitions) 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. "LIBOR Business Day" means any day that is not a
         Saturday, Sunday or other day on which commercial banking institutions
         in New York, New York, 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 the same LIBOR
         Determination Date, the corrected rate as so substituted will be the
         applicable LIBOR for that LIBOR Determination Date.

                           (2)      If, on any LIBOR Determination Date, such
         rate does not appear on Telerate Page 3750 or such other page as may
         replace such 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
         six-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. (New York time) on the LIBOR Determination
         Date made by the Calculation Agent to the Reference Banks. If, on any
         LIBOR Determination Date, at least two of the Reference Banks provide
         such quotations, LIBOR shall equal the arithmetic mean of such
         quotations. If, on any LIBOR Determination Date, only one or none of
         the Reference Banks provide such quotations, 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 the relevant LIBOR Determination Date for
         six-month U.S. Dollar deposits in Europe at approximately 11:00 a.m.
         (New York time) (in an amount determined by the 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 shall be LIBOR in effect on the
         previous LIBOR Determination Date (whether or not LIBOR for such
         period was in fact determined on such LIBOR Determination Date).

                  (c)      All percentages resulting from any calculations on
the Debt 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).

                                   Annex I-2
<PAGE>   60

                  (d)      On each LIBOR Determination Date, the Calculation
Agent shall notify the Company and the Paying Agent of the applicable Coupon
Rate in effect for the related interest payment period. The Calculation Agent
shall, upon the request of the holder of any Debt Securities, provide the
Coupon Rate then in effect. All calculations made by the Calculation Agent in
the absence of manifest error shall be conclusive for all purposes and binding
on the Company and the Holders of the Debt Securities. The Paying Agent shall
be entitled to rely on information received from the Calculation Agent or the
Company as to the Coupon Rate. The Company shall, from time to time, provide
any necessary information to the Paying Agent relating to any original issue
discount and interest on the Debt 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 payment periods as described herein, semi-annually in
arrears on January 25th and July 25th of each year, commencing on January 25,
2002 (each, a "Distribution Payment Date"). The Debenture Issuer has the right
under the Indenture to defer payments of interest on the Debentures by
extending the interest payment period for up to 10 consecutive semi-annual
periods (each, an "Extension Period") at any time and from time to time on the
Debentures, subject to the conditions described below, during which Extension
Period no interest shall be due and payable (except any Additional Interest
that may be due and payable) although such interest would continue to accrue on
the Debentures, and interest will accrue on such Deferred Interest at an annual
rate equal to the Coupon Rate in effect for each such Extension Period,
compounded semi-annually to the extent permitted by law. No Extension Period
may end on a date other than a Distribution Payment Date. At the end of any
such Extension Period the Debenture Issuer shall pay all Deferred Interest;
provided, however, that no Extension Period may extend beyond the Maturity Date
and provided further, that, during any such Extension Period, the Debenture
Issuer may not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, any of the
Debenture Issuer's capital stock or (ii) make any payment of principal of or
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Debenture Issuer that rank pari passu in all respects with or
junior in interest to the Debentures (other than (a) repurchases, redemptions
or other acquisitions of shares of capital stock of the Debenture Issuer in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of one or more employees, officers,
directors or consultants, in connection with a dividend reinvestment or
stockholder stock purchase plan or in connection with the issuance of capital
stock of the Debenture Issuer (or securities convertible into or exercisable
for such capital stock) as consideration in an acquisition transaction entered
into prior to the applicable Extension Period, (b) as a result of any exchange
or conversion of any class or series of the Debenture Issuer's capital stock
(or any capital stock of a subsidiary of the Debenture Issuer) for any class or
series of the Debenture Issuer's capital stock or of any class or series of the
Debenture Issuer's indebtedness for any class or series of the Debenture
Issuer's capital stock, (c) the purchase of fractional interests in shares of
the Debenture Issuer's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(d) any declaration of a dividend in connection with any stockholder's rights
plan, or the issuance of rights, stock or other property under any
stockholder's rights plan, or the redemption or repurchase of rights pursuant
thereto, or (e) any dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of such
warrants, options or other rights is the same

                                   Annex I-3
<PAGE>   61
stock as that on which the dividend is being paid or ranks pari passu with or
junior to such stock). Prior to the termination of any Extension Period, the
Debenture Issuer may further extend such period, provided that such period
together with all such previous and further consecutive extensions thereof
shall not exceed 10 consecutive semi-annual periods, or extend beyond the
Maturity Date. Upon the termination of any Extension Period and upon the
payment of all Deferred Interest, the Debenture Issuer may commence a new
Extension Period, subject to the foregoing requirements. No interest or
Deferred Interest shall be due and payable during an Extension Period, except
at the end thereof, but each installment of interest that would otherwise have
been due and payable during such Extension Period shall bear Deferred Interest.
If Distributions are deferred, the Distributions due shall be paid on the date
that the related Extension Period terminates, or, if such date is not a
Distribution Payment Date, on the immediately following Distribution Payment
Date, to Holders of the Securities as they appear on the books and records of
the Trust on the record date immediately preceding such date. Distributions on
the Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds available for the
payment of such distributions in the Property Account of the Trust. The Trust's
funds available for Distribution to the Holders of the Securities will be
limited to payments received from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.

                  (f)      Distributions on the Securities will be payable to
the Holders thereof as they appear on the books and records of the Trust on the
relevant record dates. The relevant record dates shall be selected by the
Administrators, which dates shall be 15 days before the relevant payment dates.
Distributions payable on any Securities that are not punctually paid on any
Distribution Payment Date, as a result of the Debenture Issuer having failed to
make a payment under the Debentures, as the case may be, when due (taking into
account any Extension Period), will cease to be payable to the Person in whose
name such Securities are registered on the relevant record date, and such
defaulted Distribution will instead be payable to the Person in whose name such
Securities are registered on the special record date or other specified date
determined in accordance with the Indenture. If any date on which Distributions
are payable on the Securities is not a Business Day, then payment of the
Distribution payable on such date will be made on the next succeeding day that
is a Business Day (and without any interest or other payment in respect of any
such delay) except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such payment
date.

                  (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.

                  3.       Liquidation Distribution Upon Dissolution. In the
event of the voluntary or involuntary liquidation, dissolution, winding-up or
termination of the Trust (each, a "Liquidation") other than in connection with
a redemption of the Debentures, the Holders of the Securities will be entitled
to receive out of the assets of the Trust available for distribution to Holders
of the Securities, after satisfaction of liabilities to creditors of the Trust
(to the extent not satisfied by the Debenture Issuer), distributions equal to
the aggregate of the stated liquidation amount of $1,000 per Security plus
accrued and unpaid Distributions thereon to the date of

                                   Annex I-4
<PAGE>   62

payment (such amount being the "Liquidation Distribution"), unless in
connection with such Liquidation, the Debentures in an aggregate stated
principal amount equal to the aggregate stated liquidation amount of such
Securities, with an interest rate equal to the Coupon Rate of, and bearing
accrued and unpaid interest in an amount equal to the accrued and unpaid
Distributions on, and having the same record date as, such Securities, after
paying or making reasonable provision to pay all claims and obligations of the
Trust in accordance with Section 3808(e) of the Business Trust Act, shall be
distributed on a Pro Rata basis to the Holders of the Securities in exchange
for such Securities.

                  The Sponsor, as the Holder of all of the Common Securities,
has the right at any time to dissolve the Trust (including without limitation
upon the occurrence of a Tax Event, an Investment Company Event or a Capital
Treatment Event), subject to the receipt by the Debenture Issuer of prior
approval from the Board of Governors of the Federal Reserve System (the
"Federal Reserve"), if then required under applicable capital guidelines or
policies of the Federal Reserve and, after satisfaction of liabilities to
creditors of the Trust, cause the Debentures to be distributed to the Holders
of the Securities on a Pro Rata basis in accordance with the aggregate stated
liquidation amount thereof.

                  The Trust shall dissolve on the first to occur of (i) July
25, 2036, the expiration of the term of the Trust, (ii) a Bankruptcy Event with
respect to the Sponsor, Trust or the Debenture Issuer, (iii) (other than in
connection with a merger, consolidation or similar transaction not prohibited
by the Indenture, this Declaration or the Guarantee, as the case may be) the
filing of a certificate of dissolution of 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 to the
Holders of the Securities of the Debentures, upon exercise of the right of the
Holder of all of the outstanding Common Securities to dissolve the Trust as
described above, (v) the entry of a decree of a judicial dissolution of the
Sponsor or the Trust, or (vi) when all of the Securities shall have been called
for redemption and the amounts necessary for redemption thereof shall have been
paid to the Holders in accordance with the terms of the Securities. As soon as
practicable after the dissolution of the Trust and upon completion of the
winding up of the Trust, the Trust shall terminate upon the filing of a
certificate of cancellation with the Secretary of State of the State of
Delaware.

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

                                   Annex I-5
<PAGE>   63

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

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

                  After the date for any distribution of the Debentures upon
dissolution of the Trust, (i) the Securities of the Trust will be deemed to be
no longer outstanding, (ii) any certificates representing the Capital
Securities will be deemed to represent undivided beneficial interests in such
of the Debentures as have an aggregate principal amount equal to the aggregate
stated liquidation amount of, with an interest rate identical to the
distribution rate of, and bearing accrued and unpaid interest equal to accrued
and unpaid distributions on, the Securities until such certificates are
presented to the Debenture Issuer or its agent for transfer or reissuance (and
until such certificates are so surrendered, no payments of interest or
principal shall be made to Holders of Securities in respect of any payments due
and payable under the Debentures) and (iii) all rights of Holders of Securities
under the Capital Securities or the Common Securities, as applicable, 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 July 25, 2031. The
Debentures may be redeemed by the Debenture Issuer, in whole or in part, on any
January 25th or July 25th on or after July 25, 2006, at the Redemption Price,
upon not less than 30 days nor more than 60 day's notice to Holders of such
Debentures. In addition, upon the occurrence and continuation of a Tax Event,
an Investment Company Event or a Capital Treatment Event, the Debentures may be
redeemed by the Debenture Issuer in whole but not in part, at any time within
90 days following the occurrence of such Tax Event, Investment Company Event or
Capital Treatment Event, as the case may be (the "Special Redemption Date"), at
the Special Redemption Price, upon not less than 30 nor more than 60 days'
notice to Holders of the Debentures so long as such Tax Event, Investment
Company Event or Capital Treatment Event, as the case may be, is continuing. In
each case, the right of the Debenture Issuer to redeem the Debentures is
subject to the Debenture Issuer having received prior approval from the Federal
Reserve, if then required under applicable capital guidelines or policies of
the Federal Reserve.

                  "Tax Event" means the receipt by the Debenture Issuer and the
Trust of an opinion of counsel experienced in such matters to the effect that,
as a result of any amendment to or change (including any announced prospective
change) in the laws or any regulations thereunder of the United States or any
political subdivision or taxing authority thereof or therein, or as a result of
any official administrative pronouncement (including any private letter ruling,

                                   Annex I-6
<PAGE>   64

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) interest payable by the Debenture Issuer on the
Debentures is not, or within 90 days of the date of such opinion, will not be,
deductible by the Debenture Issuer, in whole or in part, for United States
federal income tax purposes; or (iii) the Trust is, or will be within 90 days
of the date of such opinion, subject to more than a de minimis amount of other
taxes, duties 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 the occurrence 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 of 1940, as amended,
which change or prospective change becomes effective or would become effective,
as the case may be, on or after the date of the original issuance of the
Debentures.

                  "Capital Treatment Event" means the receipt by the Debenture
Issuer and the Trust of an opinion of counsel experienced in such matters to
the effect that, as a result of the occurrence of any amendment to, or change
in, the laws, rules or regulations of the United States or any political
subdivision thereof or therein, or as the result of any official or
administrative pronouncement or action or decision interpreting or applying
such laws, rules or regulations, which amendment or change is effective or
which pronouncement, action or decision is 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 I Capital" (or the then equivalent thereof) for
purposes of the capital adequacy guidelines of the Federal Reserve, as then in
effect and applicable to the Debenture Issuer; provided, however, that the
distribution of the Debentures in connection with the Liquidation of the Trust
by the Debenture Issuer shall not in and of itself constitute a Capital
Treatment Event unless such Liquidation shall have occurred in connection with
a Tax Event or an Investment Company Event.

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

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

                                   Annex I-7
<PAGE>   65

<TABLE>
<CAPTION>
    Year Beginning                       Percentage
    --------------                       ----------

 <S>                                 <C>
     July 25, 2006                        107.6875%
     July 25, 2007                        106.1500%
     July 25, 2008                        104.6125%
     July 25, 2009                        103.0750%
     July 25, 2010                        101.5375%
 July 25, 2011 and after                  100.0000%
</TABLE>

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

                  "Special Redemption Price" means (1) if the Special
Redemption Date is before July 25, 2006, the greater of (a) 100% of the
principal amount of the Debentures being redeemed pursuant to Section 10.02 of
the Indenture or (b) as determined by a Quotation Agent, the sum of the present
values of the principal amount and the premium payable as part of the
Redemption Price with respect to a redemption as of July 25, 2006 together with
the present value of interest payments calculated at a fixed per annum rate of
interest equal to 10.25% over the Remaining Life of such Debentures, discounted
to the Special Redemption Date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Treasury Rate plus 0.50%, plus, in
the case of either (a) or (b), accrued and unpaid interest on such Debentures
to the Special Redemption Date and (2) if the Special Redemption Date is on or
after July 25, 2006, the Redemption Price for such Special Redemption Date.

                  "Comparable Treasury Issue" means, with respect to any
Special Redemption Date, the United States Treasury security selected by the
Quotation Agent as having a maturity comparable to the Remaining Life that
would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of
comparable maturity to the Remaining Life. If no United States Treasury
security has a maturity which is within a period from three months before to
three months after July 25, 2006, the two most closely corresponding United
States Treasury securities shall be used as the Comparable Treasury Issue, and
the Treasury Rate shall be interpolated or extrapolated on a straight-line
basis, rounding to the nearest month using such securities.

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

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

                                   Annex I-8
<PAGE>   66

                  "Quotation Agent" means Salomon Smith Barney Inc. and its
successors; provided, however, that if the foregoing shall cease to be a
Primary Treasury Dealer, the Debenture Issuer shall substitute therefor another
Primary Treasury Dealer.

                  "Redemption Date" shall mean the date fixed for the
redemption of Capital Securities, which shall be any January 25th or July 25th
commencing on July 25, 2006.

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

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

                  "Remaining Life" means, with respect to any Debenture, the
period from the Special Redemption Date for such Debenture to July 25, 2006.

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

                  Upon the repayment in full at maturity or redemption in whole
or in part of the Debentures (other than following the distribution of the
Debentures to the Holders of the Securities), the proceeds from such repayment
or payment shall concurrently be applied to redeem Pro Rata at the applicable
Redemption Price, Securities having an aggregate liquidation amount equal to
the aggregate principal amount of the Debentures so repaid or redeemed;
provided, however, that holders of such Securities shall be given not less than
30 nor more than 60 days' notice of such redemption (other than at the
scheduled maturity of the Debentures).

                                   Annex I-9
<PAGE>   67

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

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

                  (e)      Redemption or Distribution Procedures.

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

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

                  (iii)    If the Securities are to be redeemed and the Trust
         gives a Redemption/Distribution Notice, which notice may only be
         issued if the Debentures are redeemed as set out in this Section 4
         (which notice will be irrevocable), then, provided that the
         Institutional Trustee has a sufficient amount of cash in connection
         with the related redemption or maturity of the Debentures, the
         Institutional Trustee will pay the relevant Redemption Price to the
         Holders of such Securities by check mailed to the address of each such
         Holder appearing on the books and records of the Trust on the
         redemption date. If a Redemption/Distribution Notice shall have been
         given and funds deposited as required then immediately prior to the
         close of business on the date of such deposit Distributions will cease
         to accrue on the Securities so called for redemption and all rights of
         Holders of such Securities so called for redemption will cease, except
         the right of the Holders of such Securities to receive the applicable
         Redemption Price specified in Section 4(a), but without interest on
         such Redemption Price. If any date fixed for redemption of Securities
         is not a Business Day, then payment of any such Redemption Price
         payable on such date will be made on the next succeeding day that is a
         Business Day (and without any interest or other payment in respect of
         any such delay) except that, if such Business Day falls in the next
         calendar year, such payment will be made on the immediately preceding
         Business Day, in each case with the same force and

                                   Annex I-10
<PAGE>   68

         effect as if made on such date fixed for redemption. If payment of the
         Redemption Price in respect of any Securities is improperly withheld
         or refused and not paid either by the Trust or by the Debenture Issuer
         as guarantor pursuant to the Guarantee, Distributions on such
         Securities will continue to accrue at the then applicable rate from
         the original redemption date to the actual date of payment, in which
         case the actual payment date will be considered the date fixed for
         redemption for purposes of calculating the Redemption Price. In the
         event of any redemption of the Capital Securities issued by the Trust
         in part, the Trust shall not be required to (i) issue, register the
         transfer of or exchange any Security during a period beginning at the
         opening of business 15 days before any selection for redemption of the
         Capital Securities and ending at the close of business on the earliest
         date on which the relevant notice of redemption is deemed to have been
         given to all Holders of the Capital Securities to be so redeemed or
         (ii) register the transfer of or exchange any Capital Securities so
         selected for redemption, in whole or in part, except for the
         unredeemed portion of any Capital Securities being redeemed in part.

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

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

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

                  (b)      Subject to the requirements of obtaining a tax
opinion by the Institutional Trustee in certain circumstances set forth in the
last sentence of this paragraph, the Holders of a Majority in liquidation
amount of the Capital Securities, voting separately as a class, have the right
to direct the time, method, and place of conducting any proceeding for any
remedy available to the Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under the Declaration, including the
right to direct the Institutional Trustee, as holder of the Debentures, to (i)
exercise the remedies available under the Indenture as the holder of the
Debentures, (ii) waive any past default that is waivable under the Indenture,
or (iii) exercise any right to rescind or annul a declaration that the
principal of all the Debentures shall be due and payable or (iv) consent on
behalf of all the Holders of the Capital Securities to any amendment,
modification or termination of the Indenture or the Debentures where such
consent shall be required; provided, however, that, where a consent or action
under the Indenture would require the consent or act of the holders of greater
than a simple majority in principal amount of Debentures (a "Super Majority")
affected thereby, the Institutional Trustee may only give such consent or take
such action at the written direction of the Holders of at least the proportion
in liquidation amount of the Capital Securities outstanding which the relevant
Super

                                   Annex I-11
<PAGE>   69

Majority represents of the aggregate principal amount of the Debentures
outstanding. If the Institutional Trustee fails to enforce its rights under the
Debentures after the Holders of a Majority in liquidation amount of such
Capital Securities have so directed the Institutional Trustee, to the fullest
extent permitted by law, a Holder of the Capital Securities may institute a
legal proceeding directly against the Debenture Issuer to enforce the
Institutional Trustee's rights under the Debentures without first instituting
any legal proceeding against the Institutional Trustee or any other person or
entity. Notwithstanding the foregoing, if an Event of Default has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay interest or principal on the Debentures on the date the interest
or principal is payable (or in the case of redemption, the redemption date),
then a Holder of record of the Capital Securities may directly institute a
proceeding for enforcement of payment, on or after the respective due dates
specified in the Debentures, to such Holder directly of the principal of or
interest on the Debentures having an aggregate principal amount equal to the
aggregate liquidation amount of the Capital Securities of such Holder. The
Institutional Trustee shall notify all Holders of the Capital Securities of any
default actually known to the Institutional Trustee with respect to the
Debentures unless (x) such default has been cured prior to the giving of such
notice or (y) the Institutional Trustee determines in good faith that the
withholding of such notice is in the interest of the Holders of such Capital
Securities, except where the default relates to the payment of principal of or
interest on any of the Debentures. Such notice shall state that such Indenture
Event of Default also constitutes an Event of Default hereunder. Except with
respect to directing the time, method and place of conducting a proceeding for
a remedy, the Institutional Trustee shall not take any of the actions described
in clause (i), (ii) or (iii) above unless the Institutional Trustee has
obtained an opinion of tax counsel to the effect that, as a result of such
action, the Trust will not be classified as other than a grantor trust for
United States federal income tax purposes.

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

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

                                   Annex I-12
<PAGE>   70

by written consent of such Holders is to be taken, to be mailed to each Holder
of record of the Capital Securities. Each such notice will include a statement
setting forth the following information (i) the date of such meeting or the
date by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to
vote or of such matter upon which written consent is sought and (iii)
instructions for the delivery of proxies or consents. No vote or consent of the
Holders of the Capital Securities will be required for the Trust to redeem and
cancel Capital Securities or to distribute the Debentures in accordance with
the Declaration and the terms of the Securities.

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

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

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

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

                  (c)      Subject to Section 6.7 of the Declaration and only
after each Event of Default (if any) with respect to the Capital Securities has
been cured, waived or otherwise eliminated and subject to the requirements of
the second to last sentence of this paragraph, the Holders of a Majority in
liquidation amount of the Common Securities, voting separately as a class, may
direct the time, method, and place of conducting any proceeding for any remedy
available to the Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under the Declaration, including (i)
directing the time, method, place of conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under the Indenture or (iii)
exercise any right to rescind or annul a declaration that the principal of all
the Debentures shall be due and payable, provided, however, that, where a
consent or action under the Indenture would require a Super Majority, the
Institutional Trustee may only give such consent or take such action at the
written direction of the Holders of at least the proportion in liquidation
amount of the Common Securities which the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding. Notwithstanding
this Section 6(c), the Institutional Trustee shall not revoke any action
previously authorized or approved by a vote or consent of the Holders of the
Capital Securities. Other than with respect to directing the time, method and
place of conducting any proceeding for any remedy available to the
Institutional Trustee or the Debenture Trustee as

                                   Annex I-13
<PAGE>   71
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, any Holder of the Common Securities may institute a legal proceeding
directly against any Person to enforce the Institutional Trustee's rights under
the Declaration, without first instituting a legal proceeding against the
Institutional Trustee or any other Person.

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

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

                  7.       Amendments to Declaration and Indenture. (a) In
addition to any requirements under Section 11.1 of the Declaration, if any
proposed amendment to the Declaration provides for, or the Trustees otherwise
propose to effect, (i) any action that would adversely affect the powers,
preferences or special rights of the Securities, whether by way of amendment to
the Declaration or otherwise, or (ii) the Liquidation of the Trust, other than
as described in Section 7.1 of the Declaration, then the Holders of outstanding
Securities, voting together as a single class, will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a Majority in liquidation
amount of the Securities, affected thereby; provided, however, if any amendment
or proposal referred to in clause (i) above would adversely affect only the
Capital Securities or only the Common Securities, then only the affected class
will be entitled to vote on such amendment or proposal and such amendment or
proposal shall not be effective except with the approval of a Majority in
liquidation amount of such class of Securities.

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

                                   Annex I-14
<PAGE>   72

the proportion in liquidation amount of the Securities which the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding.

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

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

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

                  9.       Ranking. The Capital Securities rank pari passu with
and payment thereon shall be made Pro Rata with the Common Securities except
that, where an Event of Default has occurred and is continuing, the rights of
Holders of the Common Securities to receive payment of Distributions and
payments upon liquidation, redemption and otherwise are subordinated to the
rights of the Holders of the Capital Securities with the result that no payment
of any Distribution on, or Redemption Price of, any Common Security, and no
other payment on account of redemption, liquidation or other acquisition of
Common Securities, shall be made unless payment in full in cash of all
accumulated and unpaid Distributions on all outstanding Capital Securities for
all distribution periods terminating on or prior thereto, or in the case of
payment of the Redemption Price the full amount of such Redemption Price on all
outstanding Capital Securities then called for redemption, shall have been made
or provided for, and all funds immediately available to the Institutional
Trustee shall first be applied to the payment in full in cash of all
Distributions on, or the Redemption Price of, the Capital Securities then due
and payable.

                                   Annex I-15
<PAGE>   73

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

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

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

                                   Annex I-16
<PAGE>   74

                                  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 BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY
ONLY (A) TO THE DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER
THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C)
TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2),
(3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY
FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN "ACCREDITED INVESTOR," FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (D) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE DEBENTURE ISSUER'S AND THE TRUST'S RIGHT PRIOR
TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C) OR (D) TO REQUIRE
THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE DECLARATION OF TRUST, A
COPY OF WHICH MAY BE OBTAINED FROM THE DEBENTURE ISSUER OR THE TRUST. THE
HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.

                  THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO
AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"),
(EACH A "PLAN"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN
ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THIS SECURITY OR ANY INTEREST THEREIN,
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

                                 Exhibit A-1-1
<PAGE>   75

OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS
NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT
TO SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANY
INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING
THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING
OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS
APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE
BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOT
RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE
EXEMPTION.

                  IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATE AND OTHER INFORMATION AS MAY
BE REQUIRED BY THE 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 FOR ANY PURPOSE, INCLUDING, BUT
NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS SECURITY, AND SUCH
PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS
SECURITY.

                                 Exhibit A-1-2
<PAGE>   76

Certificate Number:                   Number of Capital Securities:
                   ------------                                    ------------

                        CUSIP NO[          ]
                                 ----------

                   Certificate Evidencing Capital Securities

                                       of

                        TBC Capital Statutory Trust III

                            Floating Rate MMCapS(SM)

               (liquidation amount $ 1,000 per Capital Security)

                  TBC Capital Statutory Trust III, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby certifies
that [                  ] (the "Holder") is the registered owner of securities
of the Trust representing undivided beneficial interests in the assets of the
Trust, designated the Floating Rate 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 designation, rights, privileges, restrictions, preferences and other terms
and provisions of the Capital Securities represented hereby are issued pursuant
to, and shall in all respects be subject to, the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of July 16, 2001, among
David R. Carter and James A. Taylor, Jr., as Administrators, The Bank of New
York (Delaware), as Delaware Trustee, The Bank of New York, as Institutional
Trustee, The Banc Corporation, as Sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Trust, including the
designation of the terms of the Capital Securities as set forth in Annex I to
the Declaration, as the same may be amended from time to time (the
"Declaration"). Capitalized terms used herein but not defined shall have the
meaning given them in the Declaration. The Holder is entitled to the benefits
of the Guarantee to the extent provided therein. The Sponsor will provide a
copy of the Declaration, the Guarantee, and the Indenture to the Holder without
charge upon written request to the Trust at its principal place of business.

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

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

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

                                 Exhibit A-1-3
<PAGE>   77

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

                                    TBC CAPITAL STATUTORY TRUST III

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

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

                         CERTIFICATE OF AUTHENTICATION

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

                                    THE BANK OF NEW YORK, as the
                                      Institutional Trustee

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

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

                                 Exhibit A-1-4
<PAGE>   78

                         [FORM OF REVERSE OF SECURITY]

                  Distributions payable on each Capital Security will be
payable at a variable per annum rate of interest, reset semi-annually, equal to
LIBOR (as defined in the Indenture) plus 3.75% (the "Coupon Rate") (provided,
that the applicable Coupon Rate may not exceed 12.50% through the Distribution
Payment Date in July 2011) of the stated liquidation amount of $1,000 per
Capital Security, such rate being the rate of interest payable on the
Debentures to be held by the Institutional Trustee. Except as set forth below
in respect of an Extension Period, Distributions in arrears for more than one
semi-annual period will bear interest thereon compounded semi-annually at the
applicable Coupon Rate for each such semi-annual period (to the extent
permitted by applicable law). The term "Distributions" as used herein includes
cash distributions, any such compounded interest and any Additional Interest
payable on the Debentures unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held by
the Institutional Trustee and to the extent the Institutional Trustee has funds
available in the Property Account therefor. The amount of Distributions payable
for any period will be computed for any full semi-annual Distribution period on
the basis of a 360-day year and the actual number of days elapsed in the
relevant 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 semi-annually in arrears on January 25th and July
25th of each year, commencing on January 25, 2002 (each, a "Distribution Payment
Date"). The Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures by extending the interest payment period
for up to 10 consecutive semi-annual periods (each, an "Extension Period") at
any time and from time to time on the Debentures, subject to the conditions
described below, during which Extension Period no interest shall be due and
payable (except any Additional Interest that may be due and payable) although
such interest would continue to accrue on the Debentures, and Interest will
accrue on such Deferred Interest, at an annual rate equal to the Coupon Rate in
effect for each such Extension Period, compounded semi-annually to the extent
permitted by law. No Extension Period may end on a date other than a
Distribution Payment Date. At the end of any such Extension Period the
Debenture Issuer shall pay all Deferred Interest then accrued and unpaid on the
Debentures; provided however, that no Extension Period may extend beyond the
Maturity Date. Prior to the termination of any Extension Period, the Debenture
Issuer may further extend such period, provided that such period together with
all such previous and further consecutive extensions thereof shall not exceed
10 consecutive semi-annual periods, or extend beyond the Maturity Date. Upon
the termination of any Extension Period and upon the payment of all Deferred
Interest, the Debenture Issuer may commence a new Extension Period, subject to
the foregoing requirements. No interest or Deferred Interest shall be due and
payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
such Extension Period shall bear Deferred Interest. If Distributions are
deferred, the Distributions due shall be paid on the date that the related
Extension Period terminates, or, if such date is not a Distribution Payment
Date, on the immediately following Distribution Payment Date, to Holders of the
Securities as they appear on the books and records of the Trust on the record
date immediately preceding such date. Distributions on the Securities must be
paid on the dates payable (after giving effect to any Extension Period) to the
extent that the Trust has funds available for the payment of such distributions
in the Property Account of the Trust. The Trust's funds available for
Distribution to

                                 Exhibit A-1-5
<PAGE>   79

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

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

                                 Exhibit A-1-6
<PAGE>   80

                                   ASSIGNMENT

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

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

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

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

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

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

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

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

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

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

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

                  Signature:
                            ----------------------------

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

                  Signature Guarantee(1):
                                         ---------------

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

                                 Exhibit A-1-7
<PAGE>   81
                                  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.

                                 Exhibit A-2-1
<PAGE>   82

Certificate Number:                 Number of Common Securities:
                   --------------                                --------------

                    Certificate Evidencing Common Securities

                                       of

                        TBC Capital Statutory Trust III

                  TBC Capital Statutory Trust III, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby certifies
that [            ] (the "Holder") is the registered owner of common securities
of the Trust representing undivided beneficial interests in the assets of the
Trust (the "Common Securities"). The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities represented hereby are issued pursuant to, and shall in all respects
be subject to, the provisions of the Amended and Restated Declaration of Trust
of the Trust dated as of July 16, 2001, among David R. Carter and James A.
Taylor, Jr., as Administrators, The Bank of New York (Delaware), as Delaware
Trustee, The Bank of New York, as Institutional Trustee, The Banc Corporation,
as Sponsor, and the holders from time to time of undivided beneficial interest
in the assets of the Trust including the designation of the terms of the Common
Securities as set forth in Annex I to the Declaration, as the same may be
amended from time to time (the "Declaration"). Capitalized terms used herein
but not defined shall have the meaning given them in the Declaration. The
Holder is entitled to the benefits of the Guarantee to the extent provided
therein. The Sponsor will provide a copy of the Declaration, the Guarantee and
the Indenture to the Holder without charge upon written request to the Sponsor
at its principal place of business.

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

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

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

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

                                 Exhibit A-2-2
<PAGE>   83

                  IN WITNESS WHEREOF, the Trust has executed this certificate
this ________ day of ___________, _________.

                                    TBC CAPITAL STATUTORY TRUST III

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

                                 Exhibit A-2-3
<PAGE>   84

                         [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 variable per annum rate of interest, reset semi-annually, equal
to LIBOR (as defined in the Indenture) plus 3.75% (the "Coupon Rate")
(provided, that the applicable Coupon Rate may not exceed 12.50% through the
Distribution Payment Date in July 2011) of the stated liquidation amount of
$1,000 per Capital Security, such rate being the rate of interest payable on
the Debentures to be held by the Institutional Trustee. Except as set forth
below in respect of an Extension Period, Distributions in arrears for more than
one semi-annual period will bear interest thereon compounded semiannually at
the applicable Coupon Rate for each such semi-annual period (to the extent
permitted by applicable law). The term "Distributions" as used herein includes
cash distributions, any such compounded distribution and any Additional
Interest payable on the Debentures unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available in the Property Account therefor. The amount of
Distributions payable for any period will be computed for any full semi-annual
Distribution period on the basis of a 360-day year and the actual number of
days elapsed in the relevant 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 semiannually in arrears on January 25th and July
25th of each year, commencing on January 25, 2002 (each, a "Distribution Payment
Date"). The Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures by extending the interest payment period
for up to 10 consecutive semi-annual periods (each, an "Extension Period") at
any time and from time to time on the Debentures, subject to the conditions
described below, during which Extension Period no interest shall be due and
payable (except any Additional Interest that may be due and payable). No
Extension Period may end on a date other than a Distribution Payment Date.
During an Extension Period, interest would continue to accrue on the
Debentures, and interest on such accrued interest (such accrued interest and
interest thereon referred to herein as "Deferred Interest") will accrue at an
annual rate equal to the Coupon Rate in effect for each such Extension Period,
compounded semi-annually from the date such Deferred Interest would have been
payable were it not for the Extension Period to the extent permitted by law. At
the end of any such Extension Period the Debenture Issuer shall pay all
Deferred Interest then accrued and unpaid on the Debentures; provided, however,
that no Extension Period may extend beyond the Maturity Date. Prior to the
termination of any Extension Period, the Debenture Issuer may further extend
such period, provided that such period together with all such previous and
further consecutive extensions thereof shall not exceed 10 consecutive
semi-annual periods, or extend beyond the Maturity Date. Upon the termination
of any Extension Period and upon the payment of all Deferred Interest, the
Debenture Issuer may commence a new Extension Period, subject to the foregoing
requirements. No interest or Deferred Interest shall be due and payable during
an Extension Period, except at the end thereof, but each installment of
interest that would otherwise have been due and payable during such Extension
Period shall bear Deferred Interest. If Distributions are deferred, the
Distributions due shall be paid on the date that the related Extension Period
terminates, or, if such date is not a Distribution Payment Date, on the
immediately following Distribution Payment Date, to Holders of the Securities
as they appear on the books and records of the Trust on the record date
immediately preceding such date.

                                 Exhibit A-2-4
<PAGE>   85

Distributions on the Securities must be paid on the dates payable (after giving
effect to any Extension Period) to the extent that the Trust has funds
available for the payment of such distributions in the Property Account of the
Trust. The Trust's funds available for Distribution to the Holders of the
Securities will be limited to payments received from the Debenture Issuer. The
payment of Distributions out of moneys held by the Trust is guaranteed by the
Guarantor pursuant to the Guarantee.

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

                                 Exhibit A-2-5
<PAGE>   86

                                   ASSIGNMENT

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

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

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

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

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

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

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

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

(Insert address and zip code of assignee), and irrevocably appoints
                                                                    -----------
as agent to transfer this Common Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.

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

                        Signature:
                                  --------------------

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

                        Signature Guarantee(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.

                                 Exhibit A-2-6
<PAGE>   87

                                                                      EXHIBIT B

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

The Banc Corporation
TBC Capital Statutory Trust III
17 North 20th Street
Birmingham, Alabama 35203

         Re:      Purchase of $1,000 stated liquidation amount of Floating Rate
                  MMCapS(SM) (the "Capital Securities") of TBC Capital Statutory
                  Trust III

Ladies and Gentlemen:

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

                  1.       We understand that the Floating Rate MMCapS(SM) (the
"Capital Securities") of TBC Capital Statutory Trust III (the "Trust")
(including the guarantee (the "Guarantee") of The Banc Corporation (the
"Company") executed in connection therewith) and the Floating Rate Junior
Subordinated Deferrable Interest Debentures due July 25, 2031 of the Company
(the "Subordinated Debt Securities") (the Capital Securities, the Guarantee and
the Subordinated Debt Securities together being referred to herein as "Offered
Securities"), have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), and may not be offered or sold except as
permitted in the following sentence. We agree on our own behalf and on behalf
of any investor account for which we are purchasing the Offered Securities
that, if, we decide to offer, sell or otherwise transfer any such Offered
Securities, such offer, sale or transfer will be made only (a) to 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) to an "accredited investor" with the meaning of subparagraph (a) (1), (2),
(3) or (7) of Rule 501 under the Securities Act that is acquiring Offered
Securities for its own account or for the account of such an accredited
investor for investment purposes and not with a view to, or for offer or sale
in connection with, any distribution thereof in violation of the Securities
Act, or (d) pursuant to another available exemption from the registration
requirements of the Securities Act, 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. The foregoing restrictions on
resale will not apply subsequent to the date on which, in the written opinion
of counsel, the Capital Securities are not "restricted securities" within the
meaning of Rule 144 under the Securities Act. If any resale or other transfer
of the Offered Securities is proposed to be made pursuant to clause (c) or (d)
above the transferor shall deliver a letter from the transferee substantially
in the form of this letter to The Bank of New York as Transfer Agent, which
shall provide as applicable, among other things, that the transferee is an
"accredited investor" within the meaning of subparagraph (a) (1), (2), (3) or
(7) of Rule 501 under the Securities Act that is

                                  Exhibit B-1
<PAGE>   88

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

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

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

                  4.       In the event that we purchase any Capital Securities
or any Subordinated Debt Securities, we will acquire such Capital Securities
having an aggregate stated liquidation amount of not less than $100,000 or such
Subordinated Debt Securities having an aggregate principal amount 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 subject
to the Employee Retirement Income Security Act of 1974, as amended ("ERISA") (a
"Plan"), or an entity whose assets include "plan assets" by reason of any
Plan's investment in the entity and are not purchasing the Offered Securities
on behalf of or with "plan assets" by reason of any Plan's investment in the
entity and is not purchasing the Offered Securities on behalf of or with "plan
assets" of any Plan or (B) are eligible for the exemptive relief available
under one 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 the Trust and the Company and
others will rely upon the truth and accuracy of the foregoing acknowledgments,
representations, warranties and agreements and agree that if any of the
acknowledgments, representations, warranties and agreements deemed to have been
made by our purchase of the Offered Securities are no longer accurate, we shall
promptly notify the Placement Agents. If we are acquiring any Offered
Securities as a fiduciary or agent for one or more investor accounts, we
represent that we have sole discretion with respect to each such investor
account and that we have full power to make

                                  Exhibit B-2
<PAGE>   89

the foregoing acknowledgments, representations and agreement on behalf of each
such investor account.

                                    Very truly yours,

                                    -------------------------------------------
                                        (Name of Purchaser)

                                    By:
                                       ----------------------------------------

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

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

Name:
     ----------------------------------

Address:
        -------------------------------

Taxpayer ID Number:
                   --------------------

                                  Exhibit B-3
<PAGE>   90

                                                                      EXHIBIT C

                         FORM OF TRANSFEROR CERTIFICATE
                            TO BE EXECUTED FOR QIBs

The Banc Corporation
TBC Capital Statutory Trust III
17 North 20th Street
Birmingham, Alabama 35203

         Re:      Purchase of $1,000 stated liquidation amount of Floating Rate
                  MMCapS(SM) (the "Capital Securities") of TBC Capital Statutory
                  Trust III

                  Reference is hereby made to the Amended and Restated
Declaration dated as of July 16, 2001 (the "Declaration") among David R. Carter
and James A. Taylor, Jr., as Administrators, The Bank of New York (Delaware),
as Delaware Trustee, The Bank of New York, as Institutional Trustee, The Banc
Corporation, as Sponsor, and the holders from time to time of undivided
beneficial interest in the assets of TBC Capital Statutory Trust III.
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 connection with such request, and in respect to such
Capital Securities, the transferor does hereby certify that such Capital
Securities are being transferred in accordance with (i) the transfer
restrictions set forth in the Capital Securities and (ii) Rule 144A under the
United States Securities Act of 1933, as amended ("Rule 144A"), to a transferee
that the Transferor reasonably believes is purchasing the Capital Securities
for its own account or an account with respect to which the transferee
exercises sole investment discretion and the transferee and any such account is
a "qualified institutional buyer" within the meaning of Rule 144A, in a
transaction meeting the requirements of Rule 144A and in accordance with
applicable securities laws of any state of the United States or any other
jurisdiction.

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

                                                (Name of Transferor)

                                             By:
                                                -------------------------------

                                                Name:
                                                     ---------------------
                                                Title:
                                                      --------------------

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

                                  Exhibit C-1

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