Document:

EXHIBIT 4.3

                        AMENDED AND RESTATED DECLARATION

                                    OF TRUST

                  SOUTHEASTERN BANK FINANCIAL STATUTORY TRUST I

                          Dated as of December 5, 2005

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<TABLE>
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                                TABLE OF CONTENTS

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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 . . . . . . . . . . . . . . .     9
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 . . . . . . .    15
SECTION 2.9.   Certain Duties and Responsibilities of the Trustees and the
               Administrators . . . . . . . . . . . . . . . . . . . . . . .    17
SECTION 2.10.  Certain Rights of Institutional Trustee. . . . . . . . . . .    18
SECTION 2.11.  Execution of Documents . . . . . . . . . . . . . . . . . . .    21
SECTION 2.12.  Not Responsible for Recitals or Issuance of Securities . . .    21
SECTION 2.13.  Duration of Trust. . . . . . . . . . . . . . . . . . . . . .    21
SECTION 2.14.  Mergers. . . . . . . . . . . . . . . . . . . . . . . . . . .    21

                                  ARTICLE III
                                    SPONSOR

SECTION 3.1.   Sponsor's Purchase of Common Securities. . . . . . . . . . .    23
SECTION 3.2.   Responsibilities of the Sponsor. . . . . . . . . . . . . . .    23

                                   ARTICLE IV
                          TRUSTEES AND ADMINISTRATORS

SECTION 4.1.   Number of Trustees . . . . . . . . . . . . . . . . . . . . .    24
SECTION 4.2.   Institutional Trustee; Eligibility . . . . . . . . . . . . .    24
SECTION 4.3.   Administrators . . . . . . . . . . . . . . . . . . . . . . .    25
SECTION 4.4.   Appointment, Removal and Resignation of the Trustees and
               the Administrators . . . . . . . . . . . . . . . . . . . . .    25
SECTION 4.5.   Vacancies Among Trustees . . . . . . . . . . . . . . . . . .    26

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                                TABLE OF CONTENTS
                                  (continued)

                                                                             Page

SECTION 4.6.   Effect of Vacancies. . . . . . . . . . . . . . . . . . . . .    26
SECTION 4.7.   Meetings of the Trustees and the Administrators. . . . . . .    27
SECTION 4.8.   Delegation of Power. . . . . . . . . . . . . . . . . . . . .    27
SECTION 4.9.   Merger, Conversion, Consolidation or Succession to
               Business . . . . . . . . . . . . . . . . . . . . . . . . . .    27

                                    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.   Book-Entry Capital Securities. . . . . . . . . . . . . . . .    31
SECTION 6.5.   Mutilated, Destroyed, Lost or Stolen Certificates. . . . . .    32
SECTION 6.6.   Temporary Securities . . . . . . . . . . . . . . . . . . . .    33
SECTION 6.7.   Cancellation . . . . . . . . . . . . . . . . . . . . . . . .    33
SECTION 6.8.   Rights of Holders; Waivers of Past Defaults. . . . . . . . .    33

                                  ARTICLE VII
                      DISSOLUTION AND TERMINATION OF TRUST

SECTION 7.1.   Dissolution and Termination of Trust . . . . . . . . . . . .    35

                                  ARTICLE VIII
                              TRANSFER OF INTERESTS

SECTION 8.1.   General. . . . . . . . . . . . . . . . . . . . . . . . . . .    36
SECTION 8.2.   Transfer Procedures and Restrictions . . . . . . . . . . . .    37
SECTION 8.3.   Deemed Security Holders. . . . . . . . . . . . . . . . . . .    40

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

SECTION 9.1.   Liability. . . . . . . . . . . . . . . . . . . . . . . . . .    41
SECTION 9.2.   Exculpation. . . . . . . . . . . . . . . . . . . . . . . . .    41
SECTION 9.3.   Fiduciary Duty . . . . . . . . . . . . . . . . . . . . . . .    42
SECTION 9.4.   Indemnification. . . . . . . . . . . . . . . . . . . . . . .    42
SECTION 9.5.   Outside Businesses . . . . . . . . . . . . . . . . . . . . .    45

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                                TABLE OF CONTENTS
                                  (continued)

                                                                             Page

SECTION 9.6.   Compensation; Fee. . . . . . . . . . . . . . . . . . . . . .    46

                                    ARTICLE X
                                   ACCOUNTING

SECTION 10.1.  Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . . .    46
SECTION 10.2.  Certain Accounting Matters . . . . . . . . . . . . . . . . .    46
SECTION 10.3.  Banking. . . . . . . . . . . . . . . . . . . . . . . . . . .    47
SECTION 10.4.  Withholding. . . . . . . . . . . . . . . . . . . . . . . . .    47

                                   ARTICLE XI
                            AMENDMENTS AND MEETINGS

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

                                  ARTICLE XII
                    REPRESENTATIONS OF INSTITUTIONAL TRUSTEE

SECTION 12.1.  Representations and Warranties of Institutional Trustee. . .    51

                                  ARTICLE XIII
                                  MISCELLANEOUS

SECTION 13.1.  Notices. . . . . . . . . . . . . . . . . . . . . . . . . . .    52
SECTION 13.2.  Governing Law. . . . . . . . . . . . . . . . . . . . . . . .    53
SECTION 13.3.  Submission to Jurisdiction . . . . . . . . . . . . . . . . .    53
SECTION 13.4.  Intention of the Parties . . . . . . . . . . . . . . . . . .    54
SECTION 13.5.  Headings . . . . . . . . . . . . . . . . . . . . . . . . . .    54
SECTION 13.6.  Successors and Assigns . . . . . . . . . . . . . . . . . . .    54
SECTION 13.7.  Partial Enforceability . . . . . . . . . . . . . . . . . . .    54
SECTION 13.8.  Counterparts . . . . . . . . . . . . . . . . . . . . . . . .    54

                                      -iii-
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                                TABLE OF CONTENTS
                                  (continued)

                                                                             Page

ANNEXES AND EXHIBITS

ANNEX I        Terms of TP Securities and Common Securities

EXHIBIT A-1    Form of Capital Security Certificate
EXHIBIT A-2    Form of Common Security Certificate
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<PAGE>
                    AMENDED AND RESTATED DECLARATION OF TRUST

                                       OF

                  Southeastern Bank Financial Statutory Trust I

                                December 5, 2005

     AMENDED  AND  RESTATED DECLARATION OF TRUST (this "Declaration"), dated and
effective  as  of  December  5,  2005,  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,  the  Trustee,  the  Administrators  and  the  Sponsor established
Southeastern  Bank  Financial Statutory Trust I (the "Trust"), a statutory trust
under  the Statutory Trust Act (as defined herein), pursuant to a Declaration of
Trust,  dated  as  of  December  2,  2005  (the  "Original  Declaration"), and a
Certificate  of  Trust  filed  with  the  Secretary  of  State  of  the State of
Connecticut  on  December  2,  2005, for the sole purpose of issuing and selling
certain  securities representing undivided beneficial interests in the assets of
the  Trust  and  investing  the  proceeds  thereof in the Debentures (as defined
herein)  of  the  Debenture  Issuer  (as  defined herein) in connection with the
issuance  of  the  Capital  Securities  (as  defined  herein);

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

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

     NOW,  THEREFORE,  it  being the intention of the parties hereto to continue
the  Trust  as  a  statutory  trust  under the Statutory Trust Act and that this
Declaration  constitutes  the  governing instrument of such statutory trust, and
that  all  assets contributed to the Trust will be held in trust for the benefit
of  the  holders,  from  time  to time, of the securities representing undivided
beneficial interests in the assets of the Trust issued hereunder, subject to the
provisions  of  this  Declaration, and, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties, intending to be legally bound hereby, amend
and  restate  in  its  entirety  the  Original Declaration and agree as follows:

                                    ARTICLE I
                         INTERPRETATION AND DEFINITIONS

     SECTION  1.1.  Definitions.  Unless  the  context  otherwise  requires:
                    -----------

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

<PAGE>
          (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  R. Daniel Blanton and Ronald L. Thigpen,
solely  in  such  Person's  capacity  as  Administrator  of  the Trust continued
hereunder  and not in such Person's individual capacity, or such Administrator's
successor  in  interest  in  such capacity, or any successor appointed as herein
provided.

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

     "Applicable  Depositary  Procedures" means, with respect to any transfer or
transaction involving a Book-Entry Capital Security, the rules and procedures of
the  Depositary for such Book-Entry Capital Security, in each case to the extent
applicable  to  such  transaction  and  as  in  effect  from  time  to  time.

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

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

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

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

                                      -2-
<PAGE>
taking  possession  by  a  receiver,  liquidator,  assignee, trustee, custodian,
sequestrator or other similar official of such Person of any substantial part of
its  property,  or makes any general assignment for the benefit of creditors, or
fails  generally  to  pay  its  debts  as  they  become  due.

     "Business  Day"  means any day other than Saturday, Sunday or any other day
on  which  banking institutions in Boston, Massachusetts or New York City or the
city  of  the Corporate Trust Office are permitted or required by any applicable
law  or  executive  order  to  close.

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

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

     "Capital  Securities  Purchase  Agreement"  means  the  Capital  Securities
Purchase Agreement dated as of December 2, 2005 among the Trust, the Sponsor and
Merrill  Lynch  International.

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

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

     "Certificate" means any certificate evidencing Securities.

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

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

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

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

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

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

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

     "Corporate  Trust  Office" means the office of the Institutional Trustee at
which  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 execution of this Declaration is
located  at  225  Asylum  Street, 23rd Floor, Hartford, Connecticut 06103, Attn:
Corporate  Trust  Services  -  Southeastern  Bank  Financial  Statutory Trust I.

                                      -3-
<PAGE>
     "Coupon  Rate"  has  the  meaning  set  forth in paragraph 2(a) of Annex I.

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

     "Debenture  Issuer"  means  Southeastern Bank Financial Corporation, a bank
holding  company  incorporated  in  Georgia,  in  its  capacity as issuer of the
Debentures  under  the  Indenture.

     "Debenture  Trustee"  means  U.S.  Bank  National  Association,  not in its
individual  capacity but solely as trustee under the Indenture until a successor
is  appointed  thereunder,  and  thereafter  means  such  successor  trustee.

     "Debentures" means the Junior Subordinated Debt Securities due December 15,
2035  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 applicable during such Extension Period, compounded
quarterly  from  the  date  on which such Deferred Interest would otherwise have
been  due  and  payable  until  paid  or  made  available  for  payment.

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

     "Depositary"  means  an  organization registered as a clearing agency under
the  Exchange  Act  that  is  designated  as  Depositary  by  the Sponsor or any
successor  thereto.  DTC  will  be  the  initial  Depositary.

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

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

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

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

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

     "Distribution  Payment  Period"  means  the  period  from  and  including a
Distribution  Payment  Date,  or  in  the case of the first Distribution Payment
Period,  the original date of issuance of the Securities, to, but excluding, the
next  succeeding  Distribution  Payment  Date  or,  in  the  case  of  the  last
Distribution  Payment  Period,  the  Redemption  Date,  Special  Redemption

                                      -4-
<PAGE>
Date  or  Maturity  Date (each as defined in the Indenture), as the case may be,
for  the  related  Debentures.

     "DTC" means The Depository Trust Company or any successor thereto.

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

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

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

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

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

     "Global Capital Security" means a Capital Securities Certificate evidencing
ownership  of  Book-Entry  Capital  Securities.

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

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

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

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

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

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

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

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

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

                                      -5-
<PAGE>
     "Legal Action" has the meaning set forth in Section 2.8(e).

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

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

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

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

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

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

     "Majority  in  liquidation  amount  of  the  Securities"  means  Holders of
outstanding  Securities voting together as a single class or, as the context may
require,  Holders  of  outstanding  Capital Securities or Holders of outstanding
Common  Securities  voting  separately  as a class, who are the record owners of
more  than  50% of the aggregate liquidation amount (including the 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.

     "Notice" has the meaning set forth in Section 2.11 of the Indenture.

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

          (a)  a  statement  that each officer signing the 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.

     "Owner" means each Person who is the beneficial owner of Book-Entry Capital
Securities  as  reflected  in  the records of the Depositary or, if a Depositary
Participant  is not the beneficial owner, then the beneficial owner as reflected
in  the  records  of  the  Depositary  Participant.

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

                                      -6-
<PAGE>
     "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)(E).

     "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.

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

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

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

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

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

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

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

                                      -7-
<PAGE>
     "Sponsor"  means  Southeastern  Bank  Financial Corporation, a bank holding
company  that  is a U.S. Person incorporated in Georgia, or any successor entity
in  a  merger,  consolidation  or  amalgamation  that  is  a U.S. Person, in its
capacity  as  sponsor  of  the  Trust.

     "Statutory  Trust  Act"  means  Chapter  615 of Title 34 of the Connecticut
General  Statutes, 34 C.G.S. Sec. 500 et seq., as it may be amended from time to
                                      -- ----
time,  or  any  successor  legislation.

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

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

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

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

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

     "10%  in liquidation amount of the Securities" means Holders of outstanding
Securities  voting  together  as  a single class or, as the context may require,
Holders  of  outstanding  Capital  Securities  or  Holders of outstanding Common
Securities  voting  separately  as  a class, who are the record owners of 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.

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

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

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

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

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

                                      -8-
<PAGE>
                                   ARTICLE II
                                  ORGANIZATION

     SECTION  2.1.  Name.  The  Trust  is continued hereby and shall be known as
                    ----
"Southeastern  Bank  Financial  Statutory Trust I," as such name may be modified
from  time  to  time  by  the  Administrators  following  written  notice to the
Institutional  Trustee and the Holders of the Securities. The Trust's activities
may  be conducted under the name of the Trust or any other name deemed advisable
by  the  Administrators.

     SECTION  2.2.  Office.  The  address  of the principal office of the Trust,
                    ------
which  shall  be in a state of the United States or the District of Columbia, is
225  Asylum  Street,  23rd  Floor,  Hartford,  Connecticut  06103,  Attention:
Corporate  Trust  Services  -- Southeastern Bank Financial Statutory Trust I. On
ten  Business  Days' written notice to the Institutional Trustee and the Holders
of  the  Securities,  the Administrators may designate another principal office,
which  shall  be  in  a  state of the United States or the District of Columbia.

     SECTION  2.3.  Purpose.  The  exclusive purposes and functions of the Trust
                    -------
are  (a)  to  issue  and  sell  the Securities representing undivided beneficial
interests in the assets of the Trust, (b) to invest the gross proceeds from such
sale  to  acquire  the  Debentures,  (c)  to facilitate direct investment in the
assets  of  the  Trust through issuance of the Common Securities and the Capital
Securities  and  (d) except as otherwise limited herein, to engage in only those
other  activities  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 such Trustee's powers shall
constitute  the act of and serve to bind the Trust. In dealing with the Trustees
acting  on  behalf of the Trust, no Person shall be required to inquire into the
authority  of the Trustees to bind the Trust. Persons dealing with the Trust are
entitled  to rely conclusively on the power and authority of the Trustees as set
forth  in this Declaration. The Administrators shall have only those ministerial
duties  set forth herein with respect to accomplishing the purposes of the Trust
and  are not intended to be trustees or fiduciaries with respect to the Trust or
the  Holders.  The  Institutional Trustee shall have the right, but shall not be
obligated except as provided in Section 2.6, to perform those duties assigned to
the  Administrators.

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

                                      -9-
<PAGE>
     SECTION  2.6.  Powers  and  Duties  of the Trustees and the Administrators.
                    -----------------------------------------------------------

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

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

                    (A)  the  issuance  and  sale  of  the  Securities;

                    (B)  to acquire the Debentures with the proceeds of the sale
               of  the  Securities;  provided,  however, that the Administrators
               shall cause legal title to the Debentures to be held of record in
               the  name  of  the  Institutional  Trustee for the benefit of the
               Holders;

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

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

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

                    (F)  the  sending of notices (other than notices of default)
               and other information regarding the Securities and the Debentures
               to  the  Holders  in  accordance with this Declaration, including
               notice  of  any  notice received from the Debenture Issuer of its
               election  to  defer  payments  of  interest  on the Debentures by
               extending  the  interest  payment  period  under  the  Indenture;

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

                                      -10-
<PAGE>
                    (H)  execution  and delivery of the Securities in accordance
               with  this  Declaration;

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

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

                    (K)  the taking of any action incidental to the foregoing as
               the  Sponsor  or an Administrator 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);

                    (L)  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;

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

                    (N)  to  negotiate  the  terms  of,  and  the  execution and
               delivery  of,  the Placement Agreement and the Capital Securities
               Purchase Agreement related thereto, providing for the sale of the
               Capital  Securities;

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

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

                    (Q)  to  give  the certificate required by Sec. 314(a)(4) of
               the  Trust  Indenture  Act  to  the  Institutional Trustee, which
               certificate  may  be  executed  by  an  Administrator;  and

                    (R)  to take all action that may be necessary or appropriate
               for  the  preservation  and the continuation of the Trust's valid
               existence, rights, franchises and privileges as a statutory trust
               under  the  laws  of  each

                                      -11-
<PAGE>
               jurisdiction  (other than the State of Connecticut) in which such
               existence  is  necessary  to protect the limited liability of the
               Holders  of  the  Capital  Securities  or  to enable the Trust to
               effect  the  purposes  for  which  the  Trust  was  created.

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

                    (A)  the  establishment  of  the  Property  Account;

                    (B)  the  receipt  of  the  Debentures;

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

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

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

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

                    (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;

                    (I)  after  any Event of Default (of which the Institutional
               Trustee  has  knowledge  (as provided in Section 2.10(m) hereof))
               (provided,  that  such Event of Default is not by or with respect
                --------
               to  the  Institutional  Trustee),  the  taking  of  any  action
               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);

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

                                      -12-
<PAGE>
                    (K)  to  undertake  any  actions set forth in Sec. 317(a) of
               the  Trust  Indenture  Act.

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

          (b)  So  long as this Declaration remains in effect, the Trust (or the
Trustees  or  Administrators  acting on behalf of the Trust) shall not undertake
any  business,  activities or transaction except as expressly provided herein or
contemplated  hereby. In particular, neither the Trustees nor the Administrators
may  cause  the Trust to (i) acquire any investments or engage in any activities
not  authorized  by  this  Declaration,  (ii)  sell, assign, transfer, exchange,
mortgage,  pledge,  set-off or otherwise dispose of any of the Trust Property or
interests  therein,  including  to Holders, except as expressly provided herein,
(iii)  take  any  action  that  would cause (or in the case of the Institutional
Trustee, to the actual knowledge of a Responsible Officer would cause) the Trust
to  fail  or  cease  to  qualify  as a "grantor trust" for United States federal
income tax purposes, (iv) incur any indebtedness for borrowed money or issue any
other  debt  or  (v)  take  or  consent  to  any action that would result in the
placement  of  a  lien  on  any of the Trust 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  advisement of and direction to the Administrators of actions
          they  must  take  on  behalf  of  the  Trust,  and the preparation for
          execution  and filing of any documents to be executed and filed by the
          Trust  or  on  behalf  of the Trust, as the Sponsor deems necessary or
          advisable  in  order  to  comply  with the applicable laws of any such
          States  in  connection  with  the  sale of the Capital Securities; and

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

                                      -13-
<PAGE>
          (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 (in the case of the Institutional
Trustee,  to  the actual knowledge of a Responsible Officer), and (ii) the Trust
will  not  fail  to  be  classified as a grantor trust for United States federal
income  tax  purposes  (in  the case of the Institutional Trustee, to the actual
knowledge of a Responsible Officer) and (iii) the Trust will not take any action
inconsistent  with  the  treatment  of  the  Debentures  as  indebtedness of the
Debenture  Issuer  for United States federal income tax purposes (in the case of
the Institutional Trustee, to the actual knowledge of a Responsible Officer). In
this  connection,  the Institutional Trustee, the Administrators and the Holders
of  a  Majority in liquidation amount of the Common Securities are authorized to
take  any  action, not inconsistent with applicable laws or this Declaration, as
amended  from  time  to  time,  that  each  of  the  Institutional  Trustee, the
Administrators and such Holders determine in their discretion to be necessary or
desirable for such purposes, even if such action adversely affects the interests
of  the  Holders  of  the  Capital  Securities.

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

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

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

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

     SECTION  2.7.  Prohibition  of  Actions by the Trust and the Trustees.  The
                    ------------------------------------------------------
Trust shall not, and the Institutional Trustee and the Administrators shall not,
and  the  Administrators  shall  cause  the Trust not to, engage in any activity
other  than  as  required  or authorized by this Declaration. In particular, the
Trust  shall not, and the Institutional Trustee and the Administrators shall not
cause  the  Trust  to:

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

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

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

                                      -14-
<PAGE>
          (d)  make  any  loans  or  incur  any  indebtedness  other  than loans
represented  by  the  Debentures;

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

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

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

     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.

          (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 Sec. 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

                                      -15-
<PAGE>
               (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 arise
out  of or in connection with an Event of Default of which a Responsible Officer
of the Institutional Trustee has actual knowledge or the Institutional Trustee's
duties  and  obligations  under  this  Declaration  or  the Trust Indenture Act;
provided,  however,  that  if an Event of Default has occurred and is continuing
--------   -------
and  such  event  is  attributable to the failure of the Debenture Issuer to pay
interest  or premium, if any, on or principal of the Debentures on the date such
interest,  premium, if any, or principal is otherwise payable (or in the case of
redemption, on the 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  premium,  if  any,  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 Common Securities may exercise
         --------   -------
such  right  of  subrogation  only  if  no  Event of Default with respect to the
Capital  Securities  has  occurred  and  is  continuing.

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

               (i)  the Trust has been completely liquidated and the proceeds of
          the  liquidation distributed to the Holders of the Securities pursuant
          to  the  terms of the Securities and this Declaration (including Annex
          I)  and  the  certificate of cancellation referenced in Section 7.1(b)
          has  been  filed;  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.

          (h)  The  Institutional  Trustee must exercise the powers set forth in
this  Section 2.8 in a manner that is consistent with the purposes and functions
of  the  Trust  set  out  in  Section

                                      -16-
<PAGE>
2.3,  and  the  Institutional  Trustee  shall  not  take  any  action  that  is
inconsistent  with  the  purposes  and functions of the Trust set out in Section
2.3.

     SECTION  2.9.  Certain  Duties and Responsibilities of the Trustees and the
                    ------------------------------------------------------------
Administrators.
--------------

          (a)  The  Institutional Trustee, before the occurrence of any Event of
Default  (of  which  the  Institutional  Trustee  has  knowledge (as provided in
Section  2.10(m) hereof)) and after the curing of all Events of Default that may
have  occurred,  shall undertake to perform only such duties as are specifically
set  forth  in this Declaration and no implied covenants shall be read into this
Declaration  against  the Institutional Trustee. In case an Event of Default (of
which  the  Institutional  Trustee has knowledge (as provided in Section 2.10(m)
hereof)),  has  occurred  (that has not been cured or waived pursuant to Section
6.7),  the  Institutional  Trustee  shall exercise such of the rights and powers
vested  in  it by this Declaration, and use the same degree of care and skill in
their  exercise,  as  a  prudent  person  would  exercise  or  use  under  the
     circumstances in the conduct of his or her own affairs.

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

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

                                      -17-
<PAGE>
expressly  set  forth  elsewhere  in  this  Declaration  or,  in the case of the
Institutional  Trustee,  in  the  Trust  Indenture  Act.

          (d)  No  provision  of  this Declaration shall be construed to relieve
the  Institutional  Trustee from liability for its own negligent action, its own
negligent  failure  to  act,  or  its  own  willful misconduct or bad faith with
respect  to  matters  that are within the authority of the Institutional Trustee
under  this  Declaration,  except  that:

               (i)  the  Institutional Trustee shall not be liable for any error
          or  judgment  made  in  good  faith  by  a  Responsible 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

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

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

          (a)  the  Institutional  Trustee may conclusively rely and shall fully
be  protected  in  acting  or  refraining  from  acting  in  good faith upon any
resolution, written opinion of counsel, certificate, written representation of a
Holder  or  transferee,  certificate  of  auditors  or  any  other  certificate,
statement,  instrument,  opinion,  report,  notice, request, direction, consent,
order, appraisal, bond, debenture, note, other evidence of indebtedness or other
paper  or  document

                                      -18-
<PAGE>
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 which, upon receipt of such request, shall be promptly
delivered  by  the  Sponsor  or  the  Administrators;

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

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

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

                                      -19-
<PAGE>
          (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;

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

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

          (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

                                      -20-
<PAGE>
          (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.  Execution  of  Documents.  Unless  otherwise  determined in
                     ------------------------
writing  by  the  Institutional Trustee, and except as otherwise required by the
Statutory  Trust  Act,  the  Institutional  Trustee,  or  any one or more of the
Administrators,  as  the  case  may  be, is authorized to execute and deliver on
behalf  of the Trust any documents, agreements, instruments or certificates that
the  Trustees  or  the  Administrators,  as  the case may be, have the power and
authority  to  execute  pursuant  to  Section  2.6.

     SECTION 2.12.  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  2.13.  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.

     SECTION  2.14.  Mergers.
                     -------

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

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

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

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

                    (B)  substitutes  for the Securities other securities having
               substantially  the  same  terms as the Securities (the "Successor
               Securities")

                                      -21-
<PAGE>
               so  that the Successor Securities rank the same as the Securities
               rank with respect to Distributions and payments upon Liquidation,
               redemption  and  otherwise;

               (ii)  the  Sponsor  expressly appoints a trustee of the Successor
          Entity  that possesses 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 quoted, or any Successor Securities will be listed or quoted
          upon  notification of issuance, on any national securities exchange or
          with  another  organization  on  which the Capital Securities are then
          listed  or  quoted,  if  any;

               (iv)  such  merger,  consolidation,  amalgamation,  replacement,
          conveyance,  transfer  or  lease 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,  replacement,
          conveyance,  transfer  or  lease 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;

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

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

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

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

                                      -22-
<PAGE>
               (viii)  the  Sponsor guarantees the obligations of such Successor
          Entity  under  the Successor Securities to the same extent provided by
          the  Guarantee,  the  Debentures  and  this  Declaration;  and

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

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

                                   ARTICLE III
                                     SPONSOR

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

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

          (a)  to  determine  the  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,  as  requested  by  the  Holders  of  not  less  than  a Majority in
liquidation  amount  of  the  Capital  Securities;  and

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

                                      -23-
<PAGE>
                                   ARTICLE IV
                           TRUSTEES AND ADMINISTRATORS

     SECTION  4.1.  Number  of Trustees.  The number of Trustees initially shall
                    -------------------
be  one,  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 always be one Trustee
                       --------  -------
who  shall  be  the  Institutional  Trustee.

     SECTION  4.2.  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 or national association organized
          and  doing  business under the laws of the United States of America or
          any  state thereof or of the District of Columbia and authorized under
          such  laws  to  exercise  corporate  trust  powers,  having a combined
          capital  and  surplus  of  at  least  fifty  million  U.S.  dollars
          ($50,000,000),  and  subject to supervision or examination by federal,
          state  or  District  of  Columbia  authority.  If  such corporation or
          national association publishes reports of condition at least annually,
          pursuant to law or to the requirements of the supervising or examining
          authority  referred  to  above,  then for the purposes of this Section
          4.3(a)(iii),  the  combined capital and surplus of such corporation or
          national  association  shall  be deemed to be its combined capital and
          surplus  as  set  forth  in  its  most  recent  report of condition so
          published.

          (b)  If  at  any  time  the  Institutional  Trustee  shall cease to be
eligible  to  so  act  under  Section  4.2(a),  the  Institutional Trustee shall
immediately  resign  in the manner and with the effect set forth in Section 4.5.

          (c)  If  the  Institutional  Trustee  has  or  shall  acquire  any
"conflicting  interest" within the meaning of Sec. 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 U.S. Bank National
Association.

                                      -24-
<PAGE>
     SECTION  4.3.  Administrators.  Each  Administrator shall be a U.S. Person.
                    --------------

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

     SECTION  4.4.  Appointment, Removal and Resignation of the Trustees and the
                    ------------------------------------------------------------
Administrators.
--------------

          (a)  No  resignation or removal of any 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  4.4.

          (b)  Subject  to  Section  4.4(a), a Trustee may resign at any time by
giving written notice thereof to the Holders of the Securities and by appointing
a  successor  Trustee.  Upon  the  resignation of the Institutional Trustee, the
Institutional  Trustee  shall  appoint  a  successor by requesting from at least
three Persons meeting the eligibility requirements their expenses and charges to
serve  as  the  successor  Institutional  Trustee  on  a  form  provided  by the
Administrators,  and  selecting  the  Person who agrees to the lowest reasonable
expense  and  charges (the "Successor Institutional Trustee"). If the instrument
of  acceptance  by  the successor Trustee required by this Section 4.4 shall not
have  been  delivered  to  the  Trustee  within 60 days after the giving of such
notice  of resignation or delivery of the instrument of removal, the 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
Trustee.  Such court may thereupon, after prescribing such notice, if any, as it
may  deem  proper,  appoint  a  Trustee. The Institutional Trustee shall have no
liability for the selection of such successor pursuant to this Section 4.4.

          (c)  Unless an Event of Default shall have occurred and be continuing,
any Trustee may be removed at any time by an act of the Holders of a Majority in
liquidation amount of the Common Securities. If any Trustee shall be so removed,
the  Holders  of  the  Common Securities, by act of the Holders of a Majority in
liquidation  amount  of  the  Common  Securities delivered to the Trustee, shall
promptly  appoint  a  successor Trustee, and such successor Trustee shall comply
with  the  applicable  requirements  of this Section 4.4. If an Event of Default
shall  have occurred and be continuing, the Institutional Trustee may be removed
by  the  act  of  the Holders of a Majority in liquidation amount of the Capital
Securities,  delivered  to the 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 Trustee, shall promptly
appoint a successor Trustee or Trustees, and such successor Trustee shall comply
with  the  applicable  requirements of this Section 4.4. If no successor 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 4.4 within 30 days after delivery of an instrument of removal, the
Trustee  or  any Holder who has been a Holder of the Securities for at least six
months  may,  on

                                      -25-
<PAGE>
behalf of himself and all others similarly situated, petition any federal, state
or District of Columbia court of competent jurisdiction for the appointment of a
successor  Trustee.  Such court may thereupon, after prescribing such notice, if
any, as it may deem proper, appoint a successor Trustee or Trustees.

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

          (e)  In  case of the appointment hereunder of a successor Trustee, the
retiring Trustee and each successor Trustee with respect to the Securities shall
execute  and  deliver  an  amendment hereto wherein each successor 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  Trustee  all  the  rights,  powers, trusts and duties of the retiring
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
Trustee,  it  being  understood  that  nothing herein or in such amendment shall
constitute such Trustees co-trustees and upon the execution and delivery of such
amendment  the  resignation  or  removal  of  the  retiring Trustee shall become
effective  to  the  extent  provided  therein  and  each such successor Trustee,
without  any  further  act, deed or conveyance, shall become vested with all the
rights,  powers,  trusts  and duties of the retiring Trustee; but, on request of
the  Trust  or  any  successor Trustee, such retiring Trustee shall duly assign,
transfer  and deliver to such successor Trustee all Trust Property, all proceeds
thereof  and  money  held by such retiring Trustee hereunder with respect to the
Securities and the Trust subject to the payment of all unpaid fees, expenses and
indemnities  of  such  retiring  Trustee.

          (f)  No  Institutional  Trustee  shall  be  liable  for  the  acts  or
omissions  to  act  of  any  Successor  Institutional  Trustee.

          (g)  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.

     SECTION 4.5.  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 4.4.

     SECTION  4.6.  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 4.4, the Institutional Trustee shall have all

                                      -26-
<PAGE>
the  powers  granted  to the Trustees and shall discharge all the duties imposed
upon  the  Trustees  by  this  Declaration.

     SECTION 4.7.  Meetings of the Trustees and the Administrators.  Meetings of
                   -----------------------------------------------
the Trustees or the Administrators shall be held from time to time upon the call
of any Trustee or Administrator, as applicable. Regular meetings of the Trustees
and  the  Administrators, respectively, may be in person in the United States or
by  telephone,  at  a  place (if applicable) and time fixed by resolution of the
Trustees  or the Administrators, as applicable. Notice of any in-person meetings
of  the  Trustees  or  the  Administrators  shall be hand delivered or otherwise
delivered  in  writing  (including  by  facsimile, with a hard copy by overnight
courier)  not  less  than 48 hours before such meeting. Notice of any telephonic
meetings of the Trustees or the Administrators or any committee thereof shall be
hand delivered or otherwise delivered in writing (including by facsimile, with a
hard copy by overnight courier) not less than 24 hours before a meeting. Notices
shall  contain  a brief statement of the time, place and anticipated purposes of
the meeting. The presence (whether in person or by telephone) of a Trustee or an
Administrator,  as  the  case  may be, at a meeting shall constitute a waiver of
notice  of  such meeting except where a Trustee or an Administrator, as the case
may  be,  attends  a  meeting  for  the  express  purpose  of  objecting  to the
transaction of any activity on the ground that the meeting has not been lawfully
called or convened. Unless provided otherwise in this Declaration, any action of
the  Trustees  or  the  Administrators,  as  the  case may be, may be taken at a
meeting  by  vote  of  a  majority of the Trustees or the Administrators present
(whether  in  person  or by telephone) and eligible to vote with respect to such
matter;  provided, that, in the case of the Administrators, a Quorum is present,
         --------
or  without  a  meeting  by the unanimous written consent of the Trustees or the
Administrators,  as  the  case  may  be.  Meetings  of  the  Trustees  and  the
Administrators  together  shall  be  held from time to time upon the call of any
Trustee  or  Administrator.

     SECTION  4.8.  Delegation  of  Power.
                    ---------------------

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

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

     SECTION  4.9.  Merger, Conversion, Consolidation or Succession to Business.
                    -----------------------------------------------------------
Any  Person  into  which the Institutional Trustee 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 shall be a party,
or  any  Person  succeeding  to  all  or  substantially  all the corporate trust
business  of  the  Institutional  Trustee  shall  be  the  successor  of  the
Institutional Trustee hereunder, without the execution or filing of any paper or
any  further  act  on

                                      -27-
<PAGE>
the  part  of any of the parties hereto, provided such Person shall be otherwise
qualified  and  eligible  under  this  Article.

                                    ARTICLE V
                                  DISTRIBUTIONS

     SECTION  5.1.  Distributions.
                    -------------

     (a)  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)  or  premium,  if any, on 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. For the
avoidance  of  doubt,  funds in the Property Account shall not be distributed to
Holders  to  the  extent  of  any  taxes  payable  by  the Trust, in the case of
withholding  taxes,  as  determined  by  the Institutional Trustee or any Paying
Agent  and, in the case of taxes other than withholding tax taxes, as determined
by the Administrators in a written notice to the Institutional Trustee.

     (b)  As  a  condition to the payment of any principal of or interest on the
Securities  without  the imposition of withholding tax, the Administrators shall
require  the  previous delivery of properly completed and signed applicable U.S.
federal  income  tax certifications (generally, an Internal Revenue Service Form
W-9  (or  applicable  successor  form) in the case of a person that is a "United
States  person"  within  the  meaning  of  Section 7701(a)(30) of the Code or an
Internal  Revenue Service Form W-8 (or applicable successor form) in the case of
a  person  that  is  not  a "United States person" within the meaning of Section
7701(a)(30)  of the Code, and any other certification acceptable to it to enable
the  Institutional  Trustee  or  any  Paying Agent to determine their respective
duties  and liabilities with respect to any taxes or other charges that they may
be required to pay, deduct or withhold in respect of such Securities.

                                   ARTICLE VI
                             ISSUANCE OF SECURITIES

     SECTION  6.1.  General  Provisions  Regarding  Securities.
                    ------------------------------------------

          (a)  The  Administrators shall on behalf of the Trust issue one series
of  capital  securities, evidenced by a certificate substantially in the form of
Exhibit  A-1,  representing  undivided beneficial interests in the assets of the
Trust  and  having  such  terms  as  are  set  forth  in  Annex  I (the "Capital
Securities"),  and  one  series of common securities, evidenced by a certificate
substantially  in  the  form  of  Exhibit A-2, representing undivided beneficial
interests  in  the assets of the Trust and having such terms as are set forth in
Annex  I (the "Common Securities"). The Trust shall issue no securities or other
interests  in  the assets of the Trust other than the Capital Securities and the
Common  Securities.  The  Capital Securities rank pari passu and payment thereon
shall  be  made  Pro  Rata  with  the  Common  Securities  except that, where an

                                      -28-
<PAGE>
Event  of  Default  has occurred and is continuing, the rights of Holders of the
Common  Securities  to  payment  in  respect  of Distributions and payments upon
liquidation,  redemption and otherwise are subordinated to the rights to payment
of  the  Holders  of  the  Capital  Securities.

          (b)  The Certificates shall be signed on behalf of the Trust by one or
more  Administrators.  Such signature shall be the facsimile or manual signature
of  any  Administrator.  In  case  any Administrator of the Trust who shall have
signed  any  of  the  Securities shall cease to be such Administrator before the
Certificates  so  signed  shall  be  delivered  by  the Trust, such Certificates
nevertheless  may be delivered as though the person who signed such Certificates
had not ceased to be such Administrator. Any Certificate may be signed on behalf
of  the  Trust  by  such  person  who,  at  the actual date of execution of such
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  and  shall be valid upon execution by one or more Administrators.

          (c)  The  Capital  Securities  issued  pursuant  to Regulations of the
Securities  Act  or  to  QIBs  shall  be,  except  as  provided  in Section 6.4,
Book-Entry  Capital  Securities issued in the form of one or more Global Capital
Securities  registered  in  the  name  of  the  Depositary,  or  its nominee and
deposited  with  the  Depositary or a custodian for the Depositary for credit by
the Depositary to the respective accounts of the Depositary Participants thereof
(or  such  other  accounts  as  they  may  direct).

          (d)  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.

          (e)  Upon  issuance of the Securities as provided in this Declaration,
the  Securities  so  issued shall be deemed to be validly issued, fully paid and
non-assessable,  and  each  Holder  thereof  shall  be  entitled to the benefits
provided  by  this  Declaration.

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

     SECTION  6.2.  Paying  Agent,  Transfer  Agent,  Calculation  Agent  and
                    ---------------------------------------------------------
Registrar.
---------

          (a)  The  Trust  shall  maintain  in  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 Trustee hereby appoints the
Institutional  Trustee  as Paying Agent and Transfer Agent at U.S. Bank National
Association,  100  Wall  Street,  19th  Floor,  New  York,  New  York

                                      -29-
<PAGE>
10005,  Attn:  Corporate  Trust Services - Southeastern Bank Financial Statutory
Trust  I.  The  Trust  shall  also  keep  or cause to be kept 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, one or more co-Registrars, or one
or  more  co-Transfer  Agents in such other locations as it shall determine. The
term  "Paying  Agent" includes any additional Paying Agent, the term "Registrar"
includes  any additional Registrar or co-Registrar and the term "Transfer Agent"
includes  any additional Transfer Agent or co-Transfer Agent. The Administrators
may  change  any  Paying  Agent, Transfer Agent or Registrar at any time without
prior  notice  to  any Holder. The Administrators shall notify the Institutional
Trustee  of  the  name  and  address  of  any  Paying  Agent, Transfer Agent and
Registrar  not  a party to this Declaration. The Administrators hereby initially
appoint the Institutional Trustee to act as Registrar for the Capital Securities
and  the  Common  Securities  at  its  Corporate Trust Office. The Institutional
Trustee  or  any of its Affiliates in the United States may act as Paying Agent,
Transfer  Agent  or  Registrar.

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

     SECTION  6.3.  Form  and  Dating.
                    -----------------

          (a)  The  Capital  Securities  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
Certificates  may  have  letters,  numbers,  notations  or  other  marks  of
identification  or designation and such legends or endorsements required by law,
stock  exchange rule, agreements to which the Trust is subject, if any, or usage
(provided, that any such notation, legend or endorsement is in a form acceptable
to  the  Sponsor).  The  Trust at the direction of the Sponsor shall furnish any
such  legend  not  contained  in  Exhibit  A-1  to  the Institutional Trustee in
writing.  Each  Capital  Security shall be dated the date of its authentication.
The terms and provisions of the Securities set forth in Annex I and the forms of
Securities  set  forth  in  Exhibits  A-1  and A-2 are part of the terms of this
Declaration  and  to  the  extent  applicable,  the  Institutional  Trustee, the
Administrators  and  the  Sponsor,  by  their  execution  and  delivery  of this
Declaration,  expressly  agree  to  such  terms  and  provisions and to be bound
thereby.  Capital  Securities  will  be  issued  only  in blocks having a stated
liquidation  amount  of not less than $100,000 and multiples of $1,000 in excess
thereof.

          (b)  The  Capital  Securities  sold  by  the  Trust  to  the  initial
purchasers  pursuant  to  the  Placement  Agreement  and  the Capital Securities
Purchase Agreement shall be issued in definitive form, registered in the name of
the  Holder  thereof, without coupons and with the Restricted Securities Legend.

                                      -30-
<PAGE>
     SECTION  6.4.  Book-Entry  Capital  Securities.
                    -------------------------------

          (a)  A  Global Capital Security may be exchanged, in whole or in part,
for Definitive Capital Securities Certificates registered in the names of Owners
only  if such exchange complies with Article VIII and (i) the Depositary advises
the  Administrators and the Institutional Trustee in writing that the Depositary
is  no  longer  willing  or able properly to discharge its responsibilities with
respect  to the Global Capital Security, and no qualified successor is appointed
by  the  Administrators  within ninety (90) days of receipt of such notice, (ii)
the  Depositary ceases to be a clearing agency registered under the Exchange Act
and  the Administrators fail to appoint a qualified successor within ninety (90)
days  of  obtaining  knowledge  of such event, (iii) the Administrators at their
option  advise  the  Institutional  Trustee  in writing that the Trust elects to
terminate  the  book-entry  system  through  the Depositary or (iv) an Indenture
Event  of  Default  has  occurred  and is continuing. Upon the occurrence of any
event  specified  in  clause  (i), (ii), (iii) or (iv) above, the Administrators
shall  notify the Depositary and instruct the Depositary to notify all Owners of
Book-Entry Capital Securities and the Institutional Trustee of the occurrence of
such event and of the availability of Definitive Capital Securities Certificates
to  Owners  of  the Capital Securities requesting the same. Upon the issuance of
Definitive  Capital  Securities  Certificates,  the  Administrators  and  the
Institutional  Trustee  shall  recognize  the  Holders of the Definitive Capital
Securities  Certificates as Holders.  Notwithstanding the foregoing, if an Owner
of  a  beneficial  interest  in  a Global Capital Security wishes at any time to
transfer  an  interest  in such Global Capital Security to a Person other than a
QIB,  such  transfer  shall  be  effected,  subject to the Applicable Depository
Procedures,  in  accordance  with the provisions of this Section 6.4 and Article
VIII,  and  the  transferee  shall  receive  a  Definitive  Capital  Securities
Certificate  in connection with such transfer.  A holder of a Definitive Capital
Securities  Certificate  that  is a QIB may upon request, and in accordance with
the  provisions  of  this Section 6.4 and Article VIII, exchange such Definitive
Capital  Securities  Certificate  for  a beneficial interest in a Global Capital
Security.

          (b)  If  any Global Capital Security is to be exchanged for Definitive
Capital  Securities  Certificates  or  canceled  in  part,  or if any Definitive
Capital  Securities  Certificate  is to be exchanged in whole or in part for any
Global  Capital  Security, then either (i) such Global Capital Security shall be
so  surrendered for exchange or cancellation as provided in this Section 6.4 and
Article VIII or (ii) the aggregate liquidation amount represented by such Global
Capital  Security  shall  be reduced, subject to Section 6.3, or increased by an
amount equal to the liquidation amount represented by that portion of the Global
Capital  Security  to  be  so exchanged or canceled, or equal to the liquidation
amount  represented  by such Definitive Capital Securities Certificates to be so
exchanged  for  any  Global Capital Security, as the case may be, by means of an
appropriate  adjustment  made  on  the  records  of  the  Securities  Registrar,
whereupon  the  Institutional  Trustee,  in  accordance  with  the  Applicable
Depositary  Procedures,  shall  instruct  the  Depositary  or  its  authorized
representative  to make a corresponding adjustment to its records. Upon any such
surrender  to the Administrators or the Registrar of any Global Capital Security
or  Securities  by the Depositary, accompanied by registration instructions, the
Administrators,  or  any  one  of  them,  shall  execute  the Definitive Capital
Securities  Certificates  in accordance with the instructions of the Depositary.
None  of  the  Registrar,  Administrators, or the Institutional Trustee shall be
liable  for any delay in delivery of such instructions and may conclusively rely
on,  and  shall  be  fully  protected  in  relying  on,  such  instructions.

                                      -31-
<PAGE>
          (c)  Every  Definitive  Capital  Securities  Certificate  executed and
delivered  upon registration or transfer of, or in exchange for or in lieu of, a
Global  Capital  Security or any portion thereof shall be executed and delivered
in  the form of, and shall be, a Global Capital Security, unless such Definitive
Capital  Securities Certificate is registered in the name of a Person other than
the Depositary for such Global Capital Security or a nominee thereof.

          (d)  The  Depositary  or  its nominee, as registered owner of a Global
Capital  Security,  shall  be the Holder of such Global Capital Security for all
purposes under this Declaration and the Global Capital Security, and Owners with
respect  to  a Global Capital Security shall hold such interests pursuant to the
Applicable  Depositary  Procedures.  The  Registrar,  the Administrators and the
Institutional  Trustee  shall  be  entitled  to deal with the Depositary for all
purposes  of  this  Declaration  relating  to  the  Global  Capital  Securities
(including  the  payment  of  the liquidation amount of and Distributions on the
Book-Entry Capital Securities represented thereby and the giving of instructions
or directions by Owners of Book-Entry Capital Securities represented thereby and
the  giving  of notices) as the sole Holder of the Book-Entry Capital Securities
represented  thereby  and shall have no obligations to the Owners thereof.  None
of  the  Administrators,  the Institutional Trustee nor the Registrar shall have
any liability in respect of any transfers effected by the Depositary.

          (e)  The  rights  of  the  Owners of the Book-Entry Capital Securities
shall  be  exercised  only  through the Depositary and shall be limited to those
established  by law, the Applicable Depositary Procedures and agreements between
such  Owners  and  the  Depositary and/or the Depositary Participants; provided,
                                                                       --------
solely  for  the  purpose  of  determining  whether the Holders of the requisite
amount  of  Capital  Securities  have  voted  on any matter provided for in this
Declaration,  to  the extent that Capital Securities are represented by a Global
Capital  Security,  the  Administrators  and  the  Institutional  Trustee  may
conclusively  rely  on,  and shall be fully protected in relying on, any written
instrument  (including  a  proxy)  delivered to the Institutional Trustee by the
Depositary setting forth the Owners' votes or assigning the right to vote on any
matter  to  any  other  Persons  either in whole or in part.  To the extent that
Capital  Securities  are  represented  by a Global Capital Security, the initial
Depositary  will make book-entry transfers among the Depositary Participants and
receive  and transmit payments on the Capital Securities that are represented by
a  Global  Capital  Security  to  such  Depositary Participants, and none of the
Sponsor,  the  Administrators  or  the  Institutional  Trustee  shall  have  any
responsibility  or  obligation  with  respect  thereto.

          (f)  To the extent that a notice or other communication to the Holders
is  required  under  this  Declaration,  for  so  long as Capital Securities are
represented  by  a  Global  Capital  Security,  the  Administrator  and  the
Institutional  Trustee  shall  give  all  such notices and communications to the
Depositary,  and  shall  have  no  obligations  to  the  Owners.

     SECTION  6.5.  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  hold  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

                                      -32-
<PAGE>
shall  authenticate)  and  deliver,  in  exchange  for  or  in  lieu of any such
mutilated,  destroyed,  lost  or  stolen  Certificate, a new Certificate of like
denomination.  In connection with the issuance of any new Certificate under this
Section  6.4,  the  Registrar or the Administrators may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in  connection  therewith.  Any  duplicate  Certificate  issued pursuant to this
Section  shall  constitute  conclusive  evidence of an ownership interest in the
relevant Securities, as if originally issued, whether or not the lost, stolen or
destroyed  Certificate  shall  be  found  at  any  time.

     SECTION  6.6.  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  6.7.  Cancellation.  The  Administrators  at  any time may deliver
                   -------------
Securities to the Registrar 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 in accordance with
its  standard  procedures  or  otherwise  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  6.8.  Rights  of  Holders;  Waivers  of  Past  Defaults.
                    -------------------------------------------------

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

          (b)  For  so  long  as  any Capital Securities remain outstanding, if,
upon  an  Indenture  Event  of Default under Sections 5.01(c), (e) or (f) of the
Indenture,  the  Debenture  Trustee fails or the holders of not less than 25% in
principal  amount of the outstanding Debentures fail to declare the principal of
all of the Debentures to be immediately due and payable, the Holders of not less
than a Majority in liquidation amount of the Capital Securities then outstanding
shall  have  the  right  to  make such declaration by a notice in writing to the
Institutional  Trustee,  the  Sponsor  and  the  Debenture  Trustee.

          (c)  Upon an Indenture Event of Default under Sections 5.01(c), (e) or
(f)  at  any  time  after  a  declaration  of  acceleration  of  maturity of the
Debentures  has  been  made  and

                                      -33-
<PAGE>
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 not less than a Majority in liquidation
amount  of  the  Capital  Securities,  by  written  notice  to the Institutional
Trustee,  the  Sponsor  and  the  Debenture  Trustee, may rescind and annul such
declaration  and  its  consequences  if:

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

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

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

                    (C)  all  payments  on  any  Debentures that have become due
               otherwise  than  by such 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, documented
               expenses, disbursements and advances of the Debenture Trustee and
               the  Institutional  Trustee,  their  agents  and  counsel;  and

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

          (d)  The  Holders of not less than 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.

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

                                      -34-
<PAGE>
annulment, as the case may be, shall automatically and without further action by
any Holder be canceled and of no further effect. Nothing in this paragraph shall
prevent  a Holder, or a proxy of a Holder, from giving, after expiration of such
90-day  period,  a  new  written  notice  of  declaration  of  acceleration,  or
rescission  and  annulment  thereof,  as the case may be, that is identical to a
written  notice  that has been canceled pursuant to the proviso to the preceding
sentence,  in which event a new record date shall be established pursuant to the
provisions  of  this  Section  6.7.

          (f)  Except  as otherwise provided in this Section 6.7, the Holders of
not less than a Majority in liquidation amount of the Capital Securities may, on
behalf  of  the Holders of all the Capital Securities, waive any past default or
Event  of  Default  and  its consequences. Upon such waiver, any such default or
Event  of  Default  shall  cease  to  exist, and any default or Event of Default
arising  therefrom shall be deemed to have been cured, for every purpose of this
Declaration,  but no such waiver shall extend to any subsequent or other default
or Event of Default or impair any right consequent thereon.

                                   ARTICLE VII
                      DISSOLUTION AND TERMINATION OF TRUST

     SECTION  7.1.  Dissolution  and  Termination  of  Trust.
                    ----------------------------------------

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

               (i)  unless  earlier  dissolved,  on  December  15,  2040,  the
          expiration  of  the  term  of  the  Trust;

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

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

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

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

               (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.

                                      -35-
<PAGE>
          (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, and subject to the terms
set  forth  in  Annex  I, the Institutional Trustee shall terminate the Trust by
filing,  at  the  expense of the Sponsor, a certificate of cancellation with the
Secretary of State of the State of Connecticut in accordance with Section 34-503
of  the  Statutory  Trust  Act.

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

                                  ARTICLE VIII
                              TRANSFER OF INTERESTS

     SECTION  8.1.  General.
                    -------

          (a)  Subject  to  Section  6.4  and  Section  8.1(c),  when  Capital
Securities  are presented to the 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 the requirements provided for herein for such transactions are met.
To  permit  registrations  of transfers 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 satisfactory to the
Registrar  duly

                                      -36-
<PAGE>
executed  by  the  Holder  or such Holder's attorney duly authorized in writing.
Each  Security surrendered for registration of transfer shall be canceled by the
Institutional Trustee pursuant to Section 6.6.  A transferee of a Security shall
be  entitled  to the rights and subject to the obligations of a Holder hereunder
upon  the receipt by such transferee of a Security. By acceptance of a Security,
each  transferee shall be deemed to have agreed to be bound by this Declaration.

          (e)  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)  The  Capital  Securities  shall  bear  the  Restricted Securities
Legend  (as defined below), which shall not be removed unless there is delivered
to the Trust such satisfactory evidence, which may include an opinion of counsel
reasonably  acceptable  to  the Administrators and the Institutional Trustee, as
may  be  reasonably  required  by  the  Trust or the Institutional Trustee, 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
Administrators,  shall  authenticate  and deliver Capital Securities that do not
bear  the  Restricted  Securities  Legend (other than the legend contemplated by
Section  8.2(d)).

          (b)  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 represented by
different  Certificates,  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 Administrators,
the Institutional Trustee and the Registrar, duly executed by the Holder thereof
or  his  attorney  duly  authorized  in  writing.

          (c)  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  CAPITAL  SECURITY  IS  A  GLOBAL  SECURITY  WITHIN THE MEANING OF THE
DECLARATION  HEREINAFTER  REFERRED  TO  AND  IS  REGISTERED  IN  THE NAME OF THE
DEPOSITORY  TRUST COMPANY ("DTC") OR A NOMINEE OF DTC.  THIS CAPITAL SECURITY IS
EXCHANGEABLE  FOR  CAPITAL  SECURITIES  REGISTERED IN THE NAME OF A PERSON OTHER
THAN  DTC  OR  ITS  NOMINEE  ONLY  IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
DECLARATION,  AND NO TRANSFER OF THIS CAPITAL SECURITY (OTHER THAN A TRANSFER OF
THIS

                                      -37-
<PAGE>
CAPITAL SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO
DTC  OR  ANOTHER  NOMINEE  OF  DTC)  MAY  BE  REGISTERED  EXCEPT  IN  LIMITED
CIRCUMSTANCES.

     UNLESS  THIS  CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF  DTC  TO  SOUTHEASTERN  BANK  FINANCIAL  STATUTORY  TRUST  I OR ITS AGENT FOR
REGISTRATION  OF  TRANSFER, EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY ISSUED
IS  REGISTERED  AS  REQUESTED  BY  AN  AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT  HEREON  IS  MADE  TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE  OF  DTC),  ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE  BY  OR  TO  ANY  PERSON  IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF,  CEDE  &  CO.,  HAS  AN  INTEREST  HEREIN.

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

                                      -38-
<PAGE>
     THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES, REPRESENTS AND
WARRANTS THAT IT WILL NOT ENGAGE IN HEDGING TRANSACTIONS INVOLVING THIS SECURITY
UNLESS  SUCH  TRANSACTIONS  ARE  IN  COMPLIANCE  WITH  THE  SECURITIES  ACT.

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

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

     THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A
LIQUIDATION  AMOUNT  OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A LIQUIDATION
AMOUNT  OF  LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER.  ANY  SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF  THIS SECURITY 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.

                                      -39-
<PAGE>
          (d)  Capital  Securities  may only be transferred in minimum blocks of
$100,000  aggregate liquidation amount (100 Capital Securities) and multiples of
$1,000  in  excess  thereof.  Any  attempted transfer of Capital Securities in a
block  having  an  aggregate  liquidation  amount of less than $100,000 shall be
deemed  to  be  void  and  of  no  legal  effect  whatsoever. Any such purported
transferee shall be deemed not to be a Holder of such Capital Securities for any
purpose,  including,  but  not  limited to, the receipt of Distributions on such
Capital  Securities,  and  such  purported transferee shall be deemed to have no
interest  whatsoever  in  such  Capital  Securities.

          (e)  Each  party hereto understands and hereby agrees that the initial
purchaser  is  intended solely to be an interim holder of the Capital Securities
and is purchasing such securities to facilitate consummation of the transactions
contemplated  herein  and in the documents ancillary hereto. Notwithstanding any
provision  in this Declaration to the contrary, the initial purchaser shall have
the right upon notice (a "Transfer Notice") to the Institutional Trustee and the
Sponsor to transfer title in and to the Capital Securities; provided the initial
purchaser  shall  take  reasonable  steps to ensure that such transfer is exempt
from  registration  under  the  Securities  Act  of  1933, as amended, and rules
promulgated  thereunder.  Any  Transfer  Notice  delivered  to the Institutional
Trustee  and  Sponsor  pursuant  to  the  preceding  sentence shall indicate the
aggregate  liquidation  amount of Capital Securities being transferred, the name
and  address  of  the transferee thereof (the "Transferee") and the date of such
transfer. Notwithstanding any provision in this Declaration to the contrary, the
transfer  by  the  initial  purchaser  of title in and to the Capital Securities
pursuant  to  a Transfer Notice shall not be subject to any requirement relating
to  Opinions  of  Counsel,  Certificates  of  Transfer  or  any other Opinion or
Certificate  applicable  to  transfers  hereunder  and  relating  to  Capital
Securities.

          (f)  Neither  the  Institutional  Trustee  nor  the Registrar shall be
responsible  for  ascertaining  whether any transfer hereunder complies with the
registration provisions of or any exemptions from the Securities Act, applicable
state  securities  laws or the applicable laws of any other jurisdiction, ERISA,
the  Code  or  the  Investment  Company  Act.

     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.

                                      -40-
<PAGE>
                                   ARTICLE IX
                       LIMITATION OF LIABILITY OF HOLDERS
                        OF SECURITIES, TRUSTEES OR OTHERS

     SECTION  9.1.  Liability.
                    ---------

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

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

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

          (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)  Except  to the extent provided in Section 9.1(b), and pursuant to
Sec.  34-523(a)  of the Statutory Trust Act, the Holders of the Securities shall
be  entitled  to  the  same  limitation  of  personal  liability  extended  to
stockholders  of private corporations for profit organized under the Connecticut
Business  Corporation  Act,  Chapter  601  of  the Connecticut General Statutes,
Section  33-600  et  seq.,  except  as  otherwise specifically set forth herein.
                 --  ----

     SECTION  9.2.  Exculpation.
                    -----------

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

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

                                      -41-
<PAGE>
          (c)  It  is expressly understood and agreed by the parties hereto that
insofar  as  any document, agreement or certificate is executed on behalf of the
Trust by any Trustee (i) such document, agreement or certificate is executed and
delivered by such Trustee, not in its individual capacity, but solely as Trustee
under this Declaration in the exercise of the powers and authority conferred and
vested in it, (ii) each of the representations, undertakings and agreements made
on  the  part  of  the  Trust  is  made  and  intended  not  as representations,
warranties,  covenants,  undertakings  and  agreements  by  any  Trustee  in its
individual  capacity,  but  is made and intended for the purpose of binding only
the  Trust  and (iii) under no circumstances shall any Trustee in its individual
capacity be personally liable for the payment of any indebtedness or expenses of
the  Trust  or  be  liable  for  the  breach  or  failure  of  any  obligation,
representation,  warranty or covenant made or undertaken by the Trust under this
Declaration  or  any  other  document,  agreement  or  certificate.

     SECTION  9.3.  Fiduciary  Duty.
                    ---------------

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

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

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

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

     SECTION  9.4.  Indemnification.
                    ---------------

          (a)  (i)  The Sponsor shall indemnify, to the fullest extent permitted
          by  law, any Indemnified Person who was or is a party or is threatened
          to  be  made  a  party to any threatened, pending or completed action,
          suit  or  proceeding,  whether  civil,  criminal,  administrative  or
          investigative  (other  than an action by or in the right of the Trust)
          by reason of the fact that such Person is or was an Indemnified Person
          against  expenses (including attorneys' fees and expenses), judgments,
          fines  and amounts paid in settlement actually and reasonably incurred
          by  such  Person

                                      -42-
<PAGE>
          in  connection  with  such  action,  suit or proceeding if such Person
          acted in good faith and in a manner such Person reasonably believed to
          be  in  or  not  opposed to the best interests of the Trust, and, with
          respect  to any criminal action or proceeding, had no reasonable cause
          to  believe  such conduct was unlawful. The termination of any action,
          suit or proceeding by judgment, order, settlement, conviction, or upon
          a  plea  of  nolo  contendere or its equivalent, shall not, of itself,
          create  a  presumption that the Indemnified Person did not act in good
          faith  and  in a manner which such Person reasonably believed to be in
          or  not  opposed to the best interests of the Trust, and, with respect
          to  any criminal action or proceeding, had reasonable cause to believe
          that  such  conduct  was  unlawful.

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

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

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

                                      -43-
<PAGE>
               (v)  To  the fullest extent permitted by law, expenses (including
          attorneys'  fees  and  expenses)  incurred by an Indemnified Person in
          defending  a  civil, criminal, administrative or investigative action,
          suit  or  proceeding  referred  to  in paragraphs (i) and (ii) of this
          Section  9.4(a)  shall  be paid by the Sponsor in advance of the final
          disposition  of  such  action,  suit  or proceeding upon receipt of an
          undertaking  by  or on behalf of such Indemnified Person to repay such
          amount  if  it  shall ultimately be determined that such Person is not
          entitled  to  be  indemnified  by  the  Sponsor  as authorized in this
          Section  9.4(a).  Notwithstanding  the  foregoing, no advance shall be
          made by the Sponsor if a determination is reasonably and promptly made
          (1)  in  the  case  of  a  Company  Indemnified  Person  (A)  by  the
          Administrators  by  a  majority  vote  of  a  Quorum  of disinterested
          Administrators,  (B)  if  such a Quorum is not obtainable, or, even if
          obtainable, if a Quorum of disinterested Administrators so directs, by
          independent  legal  counsel  in a written opinion or (C) by the Common
          Security  Holder of the Trust, that, based upon the facts known to the
          Administrators, counsel or the Common Security Holder at the time such
          determination  is  made, such Indemnified Person acted in bad faith or
          in  a  manner that such Person either believed to be opposed to or did
          not believe to be in the best interests of the Trust, or, with respect
          to  any  criminal proceeding, that such Indemnified Person believed or
          had  reasonable  cause to believe such conduct was unlawful, or (2) in
          the  case  of  a  Fiduciary  Indemnified  Person, by independent legal
          counsel  in  a written opinion that, based upon the facts known to the
          counsel  at  the  time  such  determination  is made, such Indemnified
          Person  acted in bad faith or in a manner that such Indemnified Person
          either  believed to be opposed to or did not believe to be in the best
          interests  of  the Trust, or, with respect to any criminal proceeding,
          that  such  Indemnified  Person  believed  or  had reasonable cause to
          believe  such  conduct  was unlawful. In no event shall any advance be
          made  (i)  to  a  Company  Indemnified  Person  in instances where the
          Administrators,  independent  legal  counsel  or  the  Common Security
          Holder  reasonably  determine  that  such Person deliberately breached
          such  Person's  duty  to  the  Trust or its Common or Capital Security
          Holders  or  (ii) to a Fiduciary Indemnified Person in instances where
          independent  legal  counsel  promptly  and  reasonably determines in a
          written  opinion  that such Person deliberately breached such Person's
          duty  to  the  Trust  or  its  Common  or  Capital  Security  Holders.

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

                                      -44-
<PAGE>
          (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 such Person's 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  such Person and incurred by such Person in any such capacity,
or arising out of such Person's status as such, whether or not the Sponsor would
have  the  power  to  indemnify  such  Person  against  such liability under the
provisions  of  this  Section  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 such Person would have
with respect to such constituent entity if its separate existence had continued.

          (f)  The  indemnification  and advancement of expenses provided by, or
granted  pursuant  to,  this  Section  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.

          (g)  The  provisions of this Section 9.4 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
Capital  Securities,  provided,  that  the  Sponsor  is the holder of the Common
                      --------
Securities.

     SECTION  9.5.  Outside Businesses.  Any Covered Person, the Sponsor and the
                    ------------------
Institutional  Trustee  (subject  to Section 4.3(c)) may engage in or possess an
interest  in other business ventures of any nature or description, independently
or  with  others,  similar  or  dissimilar to the business of the Trust, and the
Trust  and  the  Holders  of  Securities  shall have no rights by virtue of this
Declaration in and to such independent ventures or the income or profits derived
therefrom,  and  the  pursuit  of any such venture, even if competitive with the
business  of  the  Trust, shall not be deemed wrongful or improper.  None of any
Covered  Person,  the  Sponsor  or

                                      -45-
<PAGE>
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 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 and the Institutional Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the Sponsor,
or  may  act as depositary for, trustee or agent for, or act on any committee or
body  of  holders  of,  securities  or  other  obligations of the Sponsor or its
Affiliates.

     SECTION  9.6.  Compensation;  Fee.
                    ------------------

          (a)  Subject  to the provisions set forth in the Fee Agreement between
the  Institutional  Trustee,  Cohen Bros. & Company and the Company of even date
herewith,  the  Sponsor  agrees:

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

               (ii)  except as otherwise expressly provided herein, to reimburse
          the  Trustees  upon  request  for all reasonable, documented 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  attributable  to  their negligence or willful misconduct.

          (b)  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 Sec.
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 10-K and Form
10-Q  prepared  by  the Sponsor and filed with the Commission in accordance with
the  Exchange  Act  to

                                      -46-
<PAGE>
be  delivered  directly  to  each Holder of Securities, within 90 days after the
filing  of  each Form 10-K and within 30 days after the filing of each Form 10-Q
or  (ii) cause to be prepared at the principal office of the Trust in the United
States,  as  defined  for  purposes of Treasury Regulations Sec. 301.7701-7, and
delivered  directly  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 Sec. 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)  The  Administrators  will  cause the Sponsor's reports on Form FR
Y-9C  and FR Y-9LP 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 Sec.
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. As a condition to the payment of any
principal  of  or  interest  on  any  Debt  Security  without  the imposition of
withholding tax, the Institutional Trustee or any Paying Agent shall require the
previous  delivery  of  properly  completed  and  signed applicable U.S. federal
income  tax  certifications (generally, an Internal Revenue Service Form W-9 (or
applicable  successor  form)  in  the  case of a person that is a "United States
person"  within  the  meaning  of Section 7701(a)(30) of the Code or an Internal
Revenue  Service Form W-8 (or applicable successor form) in the case of a person
that  is  not a "United States person" within the meaning of Section 7701(a)(30)
of  the  Code)  and  any  other  certification  acceptable  to  it to enable the
Institutional  Trustee  or  any  Paying Agent and the Trustee to determine their
respective  duties  and  liabilities  with respect to any taxes or other charges
that  they  may  be  required to pay, deduct or withhold in respect of such Debt
Security  or the holder of such Debt Security under any present or future law or
regulation  of  the United States or any political subdivision thereof or taxing
authority  therein  or  to comply with any reporting or other requirements under
any  such  law  or regulation. The Administrators shall file required forms with
applicable  jurisdictions  and,  unless  an  exemption

                                      -47-
<PAGE>
from  withholding  is  properly  established  by  a  Holder, shall remit amounts
withheld  with  respect to the Holder to applicable jurisdictions. To the extent
that  the  Institutional Trustee or any Paying Agent is required to withhold and
pay  over  any  amounts  to  any  authority  with  respect  to  distributions or
allocations  to  any  Holder,  the  amount  withheld  shall  be  deemed  to be a
Distribution to the Holder in the amount of the withholding. In the event of any
claimed  overwithholding,  Holders  shall  be  limited  to an action against the
applicable  jurisdiction. If the amount required to be withheld was not withheld
from  actual  Distributions  made, the Institutional Trustee or any Paying Agent
may reduce subsequent Distributions by the amount of such withholding.

                                   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 Administrators, the Administrators,
          and

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

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

               (i)  unless  the  Institutional Trustee shall have first received

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

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

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

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

                                      -48-
<PAGE>
                    (B)  reduce  or otherwise adversely affect the powers of the
               Institutional  Trustee  in  contravention  of the Trust Indenture
               Act;

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

                    (D)  cause  the  Debenture  Issuer  to be unable to treat an
               amount  equal to the Liquidation Amount of the Capital Securities
               as  "Tier  1  Capital"  for  purposes  of  the  capital  adequacy
               guidelines  of  (x)  the  Federal  Reserve  (or, if the Debenture
               Issuer is not a bank holding company, such guidelines or policies
               applied  to  the Debenture Issuer as if the Debenture Issuer were
               subject  to  such  guidelines  of  policies)  or of (y) any other
               regulatory  authority  having  jurisdiction  over  the  Debenture
               Issuer.

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

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

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

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

          (g)  Subject  to  Section  11.1(a), 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;  or

               (iv)  modify,  eliminate  or  add  to  any  provision  of  this
          Declaration  to  such  extent  as  may  be  necessary  or  desirable,
          including,  without  limitation,  to

                                      -49-
<PAGE>
          ensure  that  the  Trust  will be classified for United States federal
          income  tax  purposes  at all times as a grantor trust and will not be
          required  to  register  as  an Investment Company under the Investment
          Company  Act (including without limitation to conform to any change in
          Rule 3a-5, Rule 3a-7 or any other applicable rule under the Investment
          Company Act or written change in interpretation or application thereof
          by  any  legislative  body,  court,  government  agency  or regulatory
          authority)  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  rights  of  Holders  of  Capital  Securities.

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

          (a)  Meetings  of the Holders of 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  not  less  than  10% in liquidation amount of such class of Securities. Such
direction shall be given by delivering to the Administrators one or more notices
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

                                      -50-
<PAGE>
          purpose  of  taking  any action without a meeting shall be returned to
          the  Trust  within  the  time  specified  by  the  Administrators;

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

               (iii)  unless  the  Statutory  Trust  Act,  this Declaration, 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  Sec.  301.7701-7).

                                   ARTICLE XII
                    REPRESENTATIONS OF INSTITUTIONAL TRUSTEE

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

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

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

                                      -51-
<PAGE>
          (c)  the Institutional Trustee is not an affiliate of the Sponsor, nor
does  the Institutional Trustee offer or provide credit or credit enhancement to
the  Trust;

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

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

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

                                  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):

               Southeastern Bank Financial Statutory Trust I
               c/o Southeastern Bank Financial Corporation
               3530 Wheeler Road
               Augusta, Georgia  30909
               Attention: Ronald L. Thigpen
               Telecopy: (706) 481-9869
               Telephone: (706) 481-1014

          (b)  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):

                                      -52-
<PAGE>
               U.S. Bank National Association
               225 Asylum Street, 23rd Floor
               Hartford, CT 06103
               Attention:  Corporate Trust Services
               Southeastern Bank Financial Statutory Trust I

With  a  copy  to:

               U.S. Bank National Association
               One Federal Street, 3rd Floor
               Boston, MA  02110
               Telecopy: (617) 603-6683
               Telephone: (617) 603-6549

          (c)  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):

               Southeastern Bank Financial Corporation
               3530 Wheeler Road
               Augusta, Georgia  30909
               Attention: Ronald L. Thigpen
               Telecopy: (706) 481-9869
               Telephone: (706) 481-1014

          (d)  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 Connecticut 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 Connecticut or any other jurisdiction that
would  call  for  the  application of the law of any jurisdiction other than the
State  of  Connecticut.

     SECTION  13.3.  Submission  to  Jurisdiction.
                     ----------------------------

          (a)  Each  of  the  parties  hereto  agrees  that  any suit, action or
proceeding  arising  out  of or based upon this Declaration, or the transactions
contemplated  hereby, may be instituted in any of the courts of the State of New
York  located  in  the Borough of Manhattan, City and State of New York, and any
competent  court  in  the  place  of  its  corporate  domicile  in  respect  of

                                      -53-
<PAGE>
actions  brought  against  it  as  a  defendant.  In  addition,  each such party
irrevocably  waives, to the fullest extent permitted by law, any objection which
it  may now or hereafter have to the laying of the venue of such suit, action or
proceeding  brought  in any such court and irrevocably waives any claim that any
such suit, action or proceeding brought in any such court has been brought in an
inconvenient  forum and irrevocably waives any right to which it may be entitled
on  account  of  its  place  of  corporate  domicile.  Each  such  party  hereby
irrevocably  waives  any  and all right to trial by jury in any legal proceeding
arising  out of or relating to this Declaration or the transactions contemplated
hereby. Each such party agrees that final judgment in any proceedings brought in
such  a court shall be conclusive and binding upon it and may be enforced in any
court  to  the jurisdiction of which it is subject by a suit upon such judgment.

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

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

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

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

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

     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.

                                      -54-
<PAGE>
     IN WITNESS WHEREOF, the undersigned have caused this Declaration to be duly
executed as of the day and year first above written.

                                        U.S. BANK NATIONAL ASSOCIATION,
                                           as Institutional Trustee

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

                                        SOUTHEASTERN BANK FINANCIAL
                                        CORPORATION,
                                           as Sponsor

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

                                        By:
                                           -------------------------------------
                                           Administrator

                                        By:
                                           -------------------------------------
                                           Administrator

                                      -55-
<PAGE>
                                     ANNEX I

                                    TERMS OF
                              CAPITAL SECURITIES AND
                                COMMON SECURITIES

     Pursuant  to  Section 6.1 of the Amended and Restated Declaration of Trust,
dated  as of December 5, 2005 (as amended from time to time, the "Declaration"),
the  designation,  rights, privileges, restrictions, preferences and other terms
and  provisions  of the Capital Securities and the Common Securities are set out
below  (each  capitalized  term  used but not defined herein has the meaning set
forth  in  the  Declaration):

     1.   Designation  and  Number.
          ------------------------

     (a)  Capital  Securities.  10,000  Capital  Securities of Southeastern Bank
Financial  Statutory Trust I (the "Trust"), with an aggregate stated liquidation
amount  with  respect  to  the  assets  of  the  Trust  of  Ten  Million Dollars
($10,000,000)  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  "TP  Securities"  (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.  310  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 Three Hundred Ten Thousand Dollars ($310,000) 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 quarterly, equal to LIBOR, as determined on
the  LIBOR  Determination  Date for such Distribution Payment Period, plus 1.40%
(the  "Coupon  Rate")  of  the  stated liquidation amount of $1,000 per Security
(provided, however, that the Coupon Rate for any Distribution Payment Period may
not  exceed  the  highest  rate  permitted  by  New York law, as the same may be
modified  by United States law of general applicability), such Coupon 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 quarterly period will bear interest
thereon  compounded  quarterly  at  the  applicable  Coupon  Rate  for each such
quarterly  period  (to  the  extent  permitted  by  applicable  law).  The  term
"Distributions"  as used herein includes cash distributions, any such compounded
distributions  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

                                      A-I-1
<PAGE>
Institutional  Trustee  and  to  the  extent the Institutional Trustee has funds
legally  available  in  the  Property  Account  therefor.  Distributions will be
computed on the basis of a 360-day year and the actual number of days elapsed in
the relevant Distribution period; provided, however, that upon the occurrence of
a  Special Event redemption pursuant to paragraph 4(a) below the amounts payable
pursuant  to this Declaration shall be calculated as set forth in the definition
of  Special  Redemption  Price.

     (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  to March 15, June 15, September 15 and December 15, (each
          such  day, a "LIBOR Determination Date") for such Distribution Payment
          Period),  the  Calculation Agent shall obtain the rate for three-month
          U.S.  Dollar  deposits  in Europe, which appears on Telerate Page 3750
          (as  defined  in  the International Swaps and Derivatives Association,
          Inc.  2000  Interest  Rate  and Currency Exchange Definitions) or such
          other  page  as  may  replace such Telerate Page 3750 on the Moneyline
          Telerate,  Inc.  service  (or such other service or services as may be
          nominated  by  the  British  Banker's  Association  as the information
          vendor  for  the  purpose of displaying London interbank offered rates
          for  U.S.  dollar  deposits),  as  of 11:00 a.m. (London time) on such
          LIBOR  Determination Date, and the rate so obtained shall be LIBOR for
          such  Distribution  Payment Period. "LIBOR Business Day" means any day
          that  is  not  a  Saturday,  Sunday  or  other day on which commercial
          banking  institutions in The City of New York or Boston, Massachusetts
          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  Distribution  Payment  Period.

               (2)  If,  on  any  LIBOR  Determination  Date, such rate does not
          appear  on  Telerate  Page 3750 or such other page as may replace such
          Telerate  Page  3750  on the Moneyline Telerate, Inc. service (or such
          other  service or services as may be nominated by the British Banker's
          Association  as  the  information vendor for the purpose of displaying
          London  interbank  offered  rates  for  U.S.  dollar  deposits),  the
          Calculation  Agent  shall determine the arithmetic mean of the offered
          quotations  of the Reference Banks (as defined below) to leading banks
          in the London Interbank market for three-month U.S. Dollar deposits in
          Europe (in an amount determined by the Calculation Agent) by reference
          to  requests  for  quotations  as  of approximately 11:00 a.m. (London
          time) on 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 a
          quotation,  LIBOR  shall  be  deemed  to be the arithmetic mean of the
          offered

                                      A-I-2
<PAGE>
          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 three-month U.S. Dollar deposits in Europe at
          approximately 11:00 a.m. (London 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 for the applicable Distribution Payment Period
          shall  be  LIBOR  in effect for the immediately preceding Distribution
          Payment  Period.

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

     (d)  As soon as practicable following each LIBOR Determination Date, but in
no  event  later  than the 30th day following such LIBOR Determination Date, the
Calculation  Agent shall notify, in writing, the Sponsor and the Paying Agent of
the  applicable  Coupon  Rate  in  effect  for  the related Distribution Payment
Period.  The  Calculation  Agent  shall,  upon  the request of the Holder of any
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  Sponsor and the Holders of the Securities.  Any
error  in  a  calculation  of  the  Coupon  Rate by the Calculation Agent may be
corrected at any time by the delivery of notice of such corrected Coupon Rate as
provided  above.  The  Paying  Agent  shall  be  entitled to rely on information
received  from  the  Calculation Agent or the Sponsor as to the Coupon Rate. The
Sponsor  shall,  from  time  to  time,  provide any necessary information to the
Paying  Agent  relating  to  any  original  issue  discount  and interest on the
Securities  that  is  included  in any payment and reportable for taxable income
calculation  purposes.  Failure to notify the Company, the Institutional Trustee
or  the  Paying  Agent  of  the  applicable  Coupon  Rate  shall  not affect the
obligation of the Company to make payment on the Debentures at such Coupon Rate.

     (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, quarterly in arrears on March
15,  June  15,  September  15 and December 15 of each year, commencing March 15,
2006  (each,  a  "Distribution  Payment  Date").  Subject to prior submission of
Notice  (as  defined  in  the  Indenture),  and  so  long as no Event of Default
pursuant  to  paragraphs  (c),  (e)  or (f) of Section 5.01 of the Indenture has
occurred  and  is  continuing  the  Debenture  Issuer  has  the  right under the
Indenture  to  defer  payments  of  interest  on the Debentures by extending the
interest  distribution  period for up to 20 consecutive quarterly periods (each,
an  "Extension  Period")  at  any  time and from time to time on the Debentures,
subject  to  the  conditions  described  below, during which Extension Period no
interest  shall  be  due and payable (except any Additional Interest that may be
due  and payable). During any Extension Period, interest will continue to accrue
on  the Debentures, and interest on such accrued interest (such accrued interest
and  interest  thereon referred to herein as "Deferred Interest") will accrue at

                                      A-I-3
<PAGE>
an  annual  rate  equal  to  the  Coupon  Rate in effect for each such Extension
Period,  compounded  quarterly  from  the date such Deferred Interest would have
been  payable  were  it not for the Extension Period, to the extent permitted by
law.  No  Extension  Period  may end on a date other than a Distribution Payment
Date  or  extend  beyond  the  Maturity Date, any Redemption Date (to the extent
redeemed) or any Special Redemption Date, as the case may be.  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 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  or premium or interest 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 or (iii) make any payment under any
guarantees  of the Debenture Issuer that rank in all respects pari passu with or
junior  in interest to the Guarantee (other than (a) repurchases, redemptions or
other  acquisitions  of  shares  of capital stock of the Debenture Issuer (A) in
connection  with  any  employment  contract,  benefit  plan  or  other  similar
arrangement  with  or  for  the  benefit  of  one  or  more employees, officers,
directors  or  consultants,  (B)  in  connection with a dividend reinvestment or
stockholder  stock  purchase  plan  or  (C)  in  connection with the issuance of
capital  stock  of  the  Debenture  Issuer  (or  securities  convertible into or
exercisable  for  such  capital  stock),  as  consideration  in  an  acquisition
transaction  entered  into  prior  to  the applicable Extension Period, (b) as a
result of any exchange, reclassification, combination or conversion of any class
or  series  of  the  Debenture Issuer's capital stock (or any capital stock of a
subsidiary  of  the  Debenture  Issuer) for any class or series of the Debenture
Issuer's  capital  stock  or  of  any  class or series of the Debenture Issuer's
indebtedness  for  any  class or series of the Debenture Issuer's capital stock,
(c)  the  purchase  of  fractional interests in shares of the Debenture Issuer's
capital  stock pursuant to the conversion or exchange provisions of such capital
stock  or  the  security  being converted or exchanged, (d) any declaration of a
dividend  in  connection  with any stockholder's rights plan, or the issuance of
rights,  stock  or  other  property  under any stockholder's rights plan, or the
redemption  or repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options or other rights where the dividend stock or the
stock  issuable  upon  exercise of such warrants, options or other rights is the
same  stock as that on which the dividend is being paid or ranks pari passu with
or  junior 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 20 consecutive quarterly 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
Deferred  Interest  shall  accrue  upon  each installment of interest that would
otherwise  have  been  due  and  payable during such Extension Period until such
installment  is paid. If Distributions are deferred, the Distributions due shall
be  paid  on the date that the related Extension Period terminates to Holders of
the  Securities  as  they  appear  on  the books and records of the Trust on the
record  date  immediately  preceding  such date. Distributions on the Securities
must  be paid on the dates payable (after giving effect to any Extension Period)
to the extent that the Trust has funds legally 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

                                      A-I-4
<PAGE>
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 Registrar on the relevant record
dates.  The  relevant  record  dates  shall  be  15  days  before  the  relevant
Distribution  Payment Date. Distributions payable on any Securities that are not
punctually  paid  on any Distribution Payment Date, as a result of the Debenture
Issuer having failed to make a payment under the Debentures, as the case may be,
when due (taking into account any Extension Period), will cease to be payable to
the  Person  in whose name such Securities are registered on the relevant record
date,  and  such defaulted Distribution will instead be payable to the Person in
whose  name  such  Securities are registered on the special record date or other
specified  date  determined  in  accordance with the Indenture.  Notwithstanding
anything  to  the  contrary  contained herein, if any Distribution Payment Date,
other  than  on the Maturity Date, any Redemption Date or the Special Redemption
Date,  falls on a day that is not a Business Day, then any Distributions payable
will  be  paid on, and such Distribution Payment Date will be moved to, the next
succeeding  Business  Day, and additional Distributions will accrue for each day
that  such  payment  is  delayed as a result thereof.  If the Maturity Date, any
Redemption  Date  or  the  Special  Redemption Date falls on a day that is not a
Business  Day, then the principal, premium, if any, and/or Distributions payable
on such date will be paid on the next succeeding Business Day, and no additional
Distributions  will  accrue  in  respect  of  such  payment  made  on  such next
succeeding  Business  Day.

     (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 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  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, upon receipt of an opinion of nationally recognized tax counsel
that  Holders  will  not  recognize  any  gain or loss for United States federal
income  tax  purposes  as  a result of the distribution Debentures, 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 any regulatory authority having
jurisdiction  over  the

                                      A-I-5
<PAGE>
Sponsor  that  is  primarily  responsible  for  regulating the activities of the
Sponsor if such approval is then required under applicable capital guidelines or
policies of such regulatory authority, 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) December 15, 2040,
the expiration of the term of the Trust, (ii) a Bankruptcy Event with respect to
the  Sponsor, the Trust or the Debenture Issuer, (iii) (other than in connection
with  a  merger,  consolidation  or  similar  transaction  not prohibited by the
Indenture,  this Declaration or the Guarantee, as the case may be) the filing of
a  certificate  of  dissolution or its equivalent with respect to the Sponsor or
upon  the revocation of the charter of the Sponsor and the expiration of 90 days
after  the  date  of  revocation  without  a  reinstatement  thereof,  (iv)  the
distribution  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  Connecticut.

     If  a  Liquidation  of  the  Trust occurs as described in clause (i), (ii),
(iii)  or  (v)  in  the  immediately  preceding  paragraph,  the  Trust shall be
liquidated  by  the  Institutional Trustee of the Trust as expeditiously as such
Trustee  determines  to  be  possible  by  distributing,  after  satisfaction of
liabilities  to  creditors  of  the  Trust as provided by applicable law, 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 to creditors of the Trust to the
extent not satisfied by the Debenture Issuer, an amount equal to the Liquidation
Distribution.  An  early Liquidation of the Trust pursuant to clause (iv) of the
immediately  preceding  paragraph  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.

     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.

                                      A-I-6
<PAGE>
     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 December 15, 2035. The Debentures may be
redeemed by the Debenture Issuer, in whole or in part, on any March 15, June 15,
September  15  or  December  15 on or after December 15, 2010, at the Redemption
Price,  upon  not  less than 30 nor more than 60 days' 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 or 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 any regulatory authority
having jurisdiction over the Debenture Issuer, if such approval is then required
under  applicable  capital  guidelines or policies of such regulatory authority.

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

                                      A-I-7
<PAGE>
amount  of  other  taxes  (including  withholding taxes), duties, assessments or
other  governmental  charges.

     "Investment  Company  Event"  means the receipt by the Debenture Issuer and
the  Trust  of  an  opinion of counsel experienced in such matters to the effect
that,  as  a  result  of  a  change  in  law  or regulation or written change in
interpretation  or  application  of  law  or regulation by any legislative body,
court,  governmental  agency  or  regulatory  authority,  there  is more than an
insubstantial  risk  that  the  Trust  is or, within 90 days of the date of such
opinion  will  be,  considered  an  "investment  company" that is required to be
registered  under the Investment Company Act, which change 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, if the Debenture Issuer is organized and
existing  under  the  laws  of  the  United  States  or any state thereof or the
District  of  Columbia,  the receipt by the Debenture Issuer and the Trust of an
Opinion  of  Counsel experienced in such matters to the effect that, as a result
of  (a)  any  amendment  to, or change in, the laws, rules or regulations of the
United  States  or  any  political subdivision thereof or therein, or any rules,
guidelines  or policies of any applicable regulatory authority for the Debenture
Issuer or (b) any official or administrative pronouncement or action or decision
interpreting  or  applying  such  laws, rules or regulations, which amendment or
change  is  effective or which pronouncement, action or decision is announced on
or  after the date of original issuance of the Debentures, there is more than an
insubstantial  risk  that,  within  90  days of the receipt of such opinion, the
aggregate  Liquidation  Amount of the Capital Securities will not be eligible to
be  treated  by the Debenture Issuer as "Tier 1 Capital" (or the then equivalent
thereof)  for purposes of the capital adequacy guidelines of the Federal Reserve
(or  any successor regulatory authority with jurisdiction over bank or financial
holding companies), as then in effect and applicable to the Debenture Issuer (or
if  the  Debenture Issuer is not a bank holding company, such guidelines applied
to  the  Debenture  Issuer  as  if  the  Debenture  Issuer  were subject to such
guidelines);  provided,  however,  that the inability of the Debenture Issuer to
treat  all  or  any  portion  of the aggregate Liquidation Amount of the Capital
Securities  as  Tier  1  Capital  shall  not  constitute the basis for a Capital
Treatment  Event,  if  such  inability  results from the Debenture Issuer having
cumulative  preferred stock, minority interests in consolidated subsidiaries, or
any  other  class  of  security or interest which the Federal Reserve or OTS, as
applicable,  may  now  or hereafter accord Tier 1 Capital treatment in excess of
the  amount  which  may now or hereafter qualify for treatment as Tier 1 Capital
under  applicable  capital  adequacy guidelines; provided further, however, that
the  distribution  of  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.

     "Special  Redemption  Price"  means,  with respect to the redemption of any
Debentures following a Special Event, an amount in cash equal to 103.525% of the
principal  amount  of  Debentures  to be redeemed prior to December 15, 2006 and
thereafter  equal  to  the  percentage of the principal amount of the Debentures
that  is  specified  below  for  the Special Redemption Date plus, in each case,
unpaid interest accrued thereon to the Special Redemption Date:

                                      A-I-8
<PAGE>
<TABLE>
<CAPTION>
         Special Redemption During the
     12-Month Period Beginning December 15  Percentage of Principal Amount
     -------------------------------------  ------------------------------
<S>                                         <C>
                      2006                             103.140%
                      2007                             102.355%
                      2008                             101.570%
                      2009                             100.785%
              2010 and thereafter                      100.000%
</TABLE>

     "Redemption  Date"  means  the  date  fixed  for  the redemption of Capital
Securities, which shall be any March 15, June 15, September 15 or December 15 on
or  after  December  15,  2010.

     "Redemption  Price"  means  100%  of the principal amount of the Debentures
being  redeemed  plus  accrued  and  unpaid  interest  on such Debentures to the
Redemption  Date.

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

     (c)  If  fewer  than  all the outstanding Securities are to be so redeemed,
the  Common  Securities and the Capital Securities will be redeemed Pro Rata and
the  Capital  Securities to be redeemed will be 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  quarterly  Distribution periods terminating on or
before  the  date  of  redemption.

     (e)  Redemption  or  Distribution  Procedures.

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

                                      A-I-9
<PAGE>
          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, with respect to Book-Entry Capital Securities, on the Redemption
          Date,  irrevocably  deposit  with  the  Depositary for such Book-Entry
          Capital  Securities,  to  the  extent  available  therefore,  funds
          sufficient  to  pay  the  relevant Redemption Price and will give such
          Depositary  irrevocable  instructions  and  authority  to  pay  the
          Redemption Price to the Owners of the Capital Securities. With respect
          to  Capital Securities that are not Book-Entry Capital Securities, the
          Institutional Trustee will pay, to the extent available therefore, 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). 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 except that, if such Business Day falls in the
          next  calendar  year,  such  payment  will  be made on the immediately
          preceding Business Day, in each case with the same force and effect as
          if  made  on  such  date  fixed  for  redemption.  If  payment  of the
          Redemption  Price  in respect of any Securities is improperly withheld
          or refused and not paid either by the 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.

                                     A-I-10
<PAGE>
               (iv)  Redemption/Distribution  Notices shall be sent by 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 anytime and from time to time purchase outstanding
          Capital  Securities  by  tender,  in  the  open  market  or by private
          agreement.

     5.   Voting  Rights  -  Capital  Securities.
          --------------------------------------

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

     (b)  Subject  to  the  requirements  of  obtaining  a  tax  opinion  by the
Institutional Trustee in certain circumstances set forth in the last sentence of
this  paragraph,  the Holders of a Majority in liquidation amount of the Capital
Securities,  voting  separately  as  a class, have the right to direct the time,
method,  and  place of conducting any proceeding for any remedy available to the
Institutional  Trustee,  or  exercising  any  trust  or power conferred upon the
Institutional  Trustee  under the Declaration, including 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, (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 not less
than  the proportion in liquidation amount of the Capital Securities outstanding
which  the  relevant Super Majority represents of the aggregate principal amount
of the Debentures outstanding. If the Institutional Trustee fails to enforce its
rights  under  the Debentures after the Holders of a Majority or Super Majority,
as  the  case  may  be, in liquidation amount of such Capital Securities have so
directed  the  Institutional  Trustee, to the fullest extent permitted by law, a
Holder  of  the  Capital  Securities  may  institute a legal proceeding directly
against the Debenture Issuer to enforce the Institutional Trustee's rights under
the  Debentures  without  first  instituting  any  legal  proceeding against the
Institutional  Trustee  or  any  other  person  or  entity.  Notwithstanding the
foregoing,  if an Event of Default has occurred and is continuing and such event
is  attributable  to  the  failure  of  the  Debenture Issuer to pay interest or
premium,  if  any,  on or principal of the Debentures on the date such interest,
premium,  if  any, on 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  premium,  if  any,  or  interest  on  the

                                     A-I-11
<PAGE>
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 may
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 not less than 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 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

                                     A-I-12
<PAGE>
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.

     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) waiving any past default and its
consequences  that  are  waivable  under  the Indenture, or (iii) exercising any
right to rescind or annul a declaration that the principal of all the Debentures
shall  be  due  and  payable, provided, however, that, where a consent or action
under  the  Indenture  would require a Super Majority, the Institutional Trustee
may  only  give such consent or take such action at the written direction of the
Holders  of  not  less  than  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 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

                                     A-I-13
<PAGE>
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 not less than 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 not less than the proportion in liquidation
amount  of  the  Securities  which the relevant Super Majority represents of the
aggregate  principal  amount  of  the  Debentures  outstanding.

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

                                     A-I-14
<PAGE>
     (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 or Special Redemption Price of, any Common
Security,  and  no  other payment on account of redemption, liquidation or other
acquisition  of  Common Securities, shall be made unless payment in full in cash
of  all  accumulated  and  unpaid  Distributions  on  all  outstanding  Capital
Securities  for  all distribution periods terminating on or prior thereto, or in
the case of payment of the Redemption Price or Special Redemption Price the full
amount  of  such  Redemption  Price  or  the  Special  Redemption  Price  on all
outstanding  Capital Securities then called for redemption, shall have been made
or  provided  for,  and  all  funds  immediately  available to the Institutional
Trustee  shall  first  be  applied  to  the  payment  in  full  in  cash  of all
Distributions  on,  or  the Redemption Price or the Special Redemption Price of,
the  Capital  Securities  then  due  and  payable.

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

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

                                     A-I-15
<PAGE>
     12.  Miscellaneous.  These  terms constitute a part of the Declaration. The
          -------------
Sponsor will provide a copy of the Declaration, the Guarantee, and the Indenture
to  a  Holder  without charge on written request to the Sponsor at its principal
place  of  business.

                                     A-I-16
<PAGE>
                                   EXHIBIT A-1

                      FORM OF CAPITAL SECURITY CERTIFICATE

                           [FORM OF FACE OF SECURITY]

     THIS  CAPITAL  SECURITY  IS  A  GLOBAL  SECURITY  WITHIN THE MEANING OF THE
DECLARATION  HEREINAFTER  REFERRED  TO  AND  IS  REGISTERED  IN  THE NAME OF THE
DEPOSITORY  TRUST COMPANY ("DTC") OR A NOMINEE OF DTC.  THIS CAPITAL SECURITY IS
EXCHANGEABLE  FOR  CAPITAL  SECURITIES  REGISTERED IN THE NAME OF A PERSON OTHER
THAN  DTC  OR  ITS  NOMINEE  ONLY  IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
DECLARATION,  AND NO TRANSFER OF THIS CAPITAL SECURITY (OTHER THAN A TRANSFER OF
THIS  CAPITAL  SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF
DTC  TO  DTC  OR  ANOTHER  NOMINEE  OF  DTC) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.

     UNLESS  THIS  CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF  DTC  TO  SOUTHEASTERN  BANK  FINANCIAL  STATUTORY  TRUST  I OR ITS AGENT FOR
REGISTRATION  OF  TRANSFER, EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY ISSUED
IS  REGISTERED  AS  REQUESTED  BY  AN  AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT  HEREON  IS  MADE  TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE  OF  DTC),  ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE  BY  OR  TO  ANY  PERSON  IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF,  CEDE  &  CO.,  HAS  AN  INTEREST  HEREIN.

     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 THE HOLDER REASONABLY BELIEVES IS A
"QUALIFIED  INSTITUTIONAL  BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO A "NON
U.S.  PERSON"  IN  AN  "OFFSHORE TRANSACTION" PURSUANT TO REGULATION S UNDER THE
SECURITIES  ACT, (D) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF  THE  SECURITIES  ACT  TO  AN  "ACCREDITED  INVESTOR"  WITHIN  THE MEANING OF
SUBPARAGRAPH  (a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT
IS  ACQUIRING  THE  SECURITY  FOR

                                      A-1-1
<PAGE>
ITS  OWN  ACCOUNT,  OR  FOR  THE  ACCOUNT  OF SUCH AN "ACCREDITED INVESTOR," FOR
INVESTMENT  PURPOSES  AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH,  ANY  DISTRIBUTION  IN VIOLATION OF THE SECURITIES ACT, OR (E) 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 (D) OR (E) TO REQUIRE THE DELIVERY
OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM IN ACCORDANCE WITH THE AMENDED AND RESTATED DECLARATION OF TRUST, A
COPY OF WHICH MAY BE OBTAINED FROM THE DEBENTURE ISSUER OR THE TRUST. THE HOLDER
OF  THIS  SECURITY  BY ITS ACCEPTANCE HEREOF AGREES THAT IT WILL COMPLY WITH THE
FOREGOING  RESTRICTIONS.

     THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES, REPRESENTS AND
WARRANTS THAT IT WILL NOT ENGAGE IN HEDGING TRANSACTIONS INVOLVING THIS SECURITY
UNLESS  SUCH  TRANSACTIONS  ARE  IN  COMPLIANCE  WITH  THE  SECURITIES  ACT.

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

     IN CONNECTION WITH ANY TRANSFER, THE HOLDER OF THE CERTIFICATE WILL DELIVER
TO  THE  REGISTRAR  AND  TRANSFER  AGENT  SUCH  CERTIFICATES

                                      A-1-2
<PAGE>
AND OTHER INFORMATION AS MAY BE REQUIRED BY THE AMENDED AND RESTATED DECLARATION
OF  TRUST TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

     THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A
LIQUIDATION  AMOUNT  OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A LIQUIDATION
AMOUNT  OF  LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER.  ANY  SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF  THIS SECURITY 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.

                                      A-1-3
<PAGE>
Certificate Number   [P-001]               Number of Capital Securities:  10,000

                    Certificate Evidencing Capital Securities

                                       of

                  Southeastern Bank Financial Statutory Trust I

                                  TP Securities

                (liquidation amount $1,000 per Capital Security)

     Southeastern  Bank  Financial  Statutory Trust I, a statutory trust created
under  the laws of the State of Connecticut (the "Trust"), hereby certifies that
Merrill  Lynch,  Pierce,  Fenner  &  Smith  Incorporated  (the "Holder"), is the
registered  owner  of  10,000  capital  securities  of  the  Trust  representing
undivided  beneficial  interests  in  the assets of the Trust, designated the TP
Securities  (liquidation  amount  $1,000  per  Capital  Security)  (the "Capital
Securities").  Subject  to  the  Declaration  (as  defined  below),  the Capital
Securities  are transferable on the books and records of the Trust, in person or
by  a duly authorized attorney, upon surrender of this Certificate duly endorsed
and  in  proper form for transfer. The Capital Securities represented hereby are
issued  pursuant  to,  and  the  designation,  rights, privileges, restrictions,
preferences  and  other  terms and provisions of the Capital Securities shall in
all  respects  be  subject  to,  the  provisions  of  the  Amended  and Restated
Declaration of Trust of the Trust, dated as of December 5, 2005, among R. Daniel
Blanton  and  Ronald  L.  Thigpen,  as  Administrators,  U.S.  Bank  National
Association,  as Institutional Trustee, Southeastern Bank Financial 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 Sponsor at its
principal  place  of  business.

     By  acceptance 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 shall be construed in accordance
with,  the  laws  of  the  State of Connecticut, without regard to principles of
conflict  of  laws.

                                      A-1-4
<PAGE>
     IN WITNESS WHEREOF, the Trust has duly executed this certificate.

                                   Southeastern Bank Financial Statutory Trust I

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

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

                          CERTIFICATE OF AUTHENTICATION

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

                                   U.S. BANK NATIONAL ASSOCIATION, not in its
                                   individual capacity but solely as
                                   Institutional Trustee

                                   By:
                                      ------------------------------------------
                                      Authorized Signatory

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

                                      A-1-5
<PAGE>
                          [FORM OF REVERSE OF SECURITY]

     Distributions  payable  on  each  Capital  Security  will  be  payable at a
variable per annum rate of interest, reset quarterly, equal to LIBOR (as defined
in  the  Declaration)  plus  1.40% (the "Coupon Rate") of the stated liquidation
amount  of  $1,000 per Capital Security (provided, however, that the Coupon Rate
for any Distribution Payment Period may not exceed the highest rate permitted by
New  York  law,  as  the  same  may  be modified by United States law of general
applicability),  such  Coupon  Rate  being  the  rate of interest payable on the
Debentures to be held by the Institutional Trustee. Distributions in arrears for
more  than  one quarterly period will bear interest thereon compounded quarterly
at the then applicable Coupon Rate for each such quarterly period (to the extent
permitted  by  applicable law). The term "Distributions" as used herein includes
cash  distributions,  any  such  compounded  distributions  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  legally  available  in the Property Account therefor.  Distributions
will  be  computed  on the basis of a 360-day year and the actual number of days
elapsed  in  the  relevant  Distribution  Payment  Period.

     Except  as  otherwise  described  below,  Distributions  on  the  Capital
Securities  will  be  cumulative, will accrue from the date of original issuance
and  will be payable quarterly in arrears on March 15, June 15, September 15 and
December  15  of  each year, commencing on March 15, 2006 (each, a "Distribution
Payment  Date").  Upon  submission of Notice, and so long as no Event of Default
pursuant  to  paragraphs  (c),  (e)  or (f) of Section 5.01 of the Indenture has
occurred  and  is  continuing  the  Debenture  Issuer  has  the  right under the
Indenture  to  defer  payments  of  interest  on the Debentures by extending the
interest  distribution  period for up to 20 consecutive quarterly periods (each,
an  "Extension  Period")  at  any  time and from time to time on the Debentures,
subject  to  the  conditions  described  below, during which Extension Period no
interest  shall  be  due and payable (except any Additional Interest that may be
due  and payable). During any Extension Period, interest will continue to accrue
on  the Debentures, and interest on such accrued interest (such accrued interest
and  interest  thereon referred to herein as "Deferred Interest") will accrue at
an  annual  rate  equal  to  the  Coupon  Rate in effect for each such Extension
Period,  compounded  quarterly  from  the date such Deferred Interest would have
been  payable  were  it not for the Extension Period, to the extent permitted by
law.  No  Extension  Period  may end on a date other than a Distribution Payment
Date  or  extend  beyond  the  Maturity Date, any Redemption Date (to the extent
redeemed)  or any Special Redemption Date, as the case may be. 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 20 consecutive quarterly periods, or extend
beyond  the  Maturity  Date, Redemption Date (to the extent redeemed) or Special
Redemption  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  (except  any  Additional Amounts that may be due and payable) shall be
due  and  payable  during  an  Extension  Period, except at the end thereof, but
Deferred  Interest  shall  accrue  upon  each installment of interest that would
otherwise  have  been  due  and  payable during such Extension Period until such
installment  is  paid.  If  Distributions  are

                                      A-1-6
<PAGE>
deferred,  the  Distributions  due  shall  be  paid on the date that the related
Extension  Period  terminates to Holders of the Securities as they appear on the
books  and  records  of  the Trust on the record date immediately preceding such
date.  Distributions  on the Securities must be paid on the dates payable (after
giving  effect  to  any Extension Period) to the extent that the Trust has funds
legally  available for the payment of such distributions in the Property Account
of the Trust. The Trust's funds available for Distribution to the Holders of the
Securities  will  be limited to payments received from the Debenture Issuer. The
payment  of  Distributions  out of moneys held by the Trust is guaranteed by the
Guarantor  pursuant  to  the  Guarantee.

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

                                      A-1-7
<PAGE>
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 it, him or her.

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

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

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

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

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

                                      A-1-8
<PAGE>
                                   EXHIBIT A-2

                       FORM OF COMMON SECURITY CERTIFICATE

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

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

                                      A-2-1
<PAGE>
Certificate Number     [C-001]             Number of Common Securities:  310

                    Certificate Evidencing Common Securities
                                       of
                  Southeastern Bank Financial Statutory Trust I

     Southeastern  Bank  Financial  Statutory Trust I, a statutory trust created
under  the laws of the State of Connecticut (the "Trust"), hereby certifies that
Southeastern  Bank  Financial Corporation (the "Holder") is the registered owner
of  310  common  securities  of  the  Trust  representing  undivided  beneficial
interests  in  the  assets  of  the  Trust (liquidation amount $1,000 per Common
Security)  (the  "Common  Securities"). The Common Securities represented hereby
are  issued  pursuant to, and the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Common Securities shall in all
respects  be  subject to, the provisions of the Amended and Restated Declaration
of Trust of the Trust, dated as of December 5, 2005, among R. Daniel Blanton and
Ronald  L.  Thigpen,  as  Administrators,  U.S.  Bank  National  Association, as
Institutional Trustee, the Holder, as Sponsor, and the holders from time to time
of  undivided  beneficial  interests  in  the assets of the Trust, including the
designation of the terms of the Common Securities as set forth in Annex I to the
Declaration,  as  the same may be amended from time to time (the "Declaration").
Capitalized  terms used herein but not defined shall have the meaning given them
in  the  Declaration. The Sponsor will provide a copy of the Declaration and the
Indenture  to  the  Holder without charge upon written request to the Sponsor at
its  principal  place  of  business.

     As  set forth in the Declaration, when an Event of Default has occurred and
is  continuing, the rights of 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.

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

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

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

                                      A-2-2
<PAGE>
     IN WITNESS WHEREOF, the Trust has executed this certificate as of this ____
day  of  _____________,  2005.

                                   Southeastern Bank Financial Statutory Trust I

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

                                      A-2-3
<PAGE>
                          [FORM OF REVERSE OF SECURITY]

     Distributions payable on each Common Security will be payable at a variable
per  annum  rate of interest, reset quarterly, equal to LIBOR (as defined in the
Declaration)  plus 1.40% (the "Coupon Rate") of the stated liquidation amount of
$1,000  per  Capital  Security  (provided, however, that the Coupon Rate for any
Distribution  Payment  Period  may  not exceed the highest rate permitted by New
York  law,  as  the  same  may  be  modified  by  United  States  law of general
applicability),  such  Coupon  Rate  being  the  rate of interest payable on the
Debentures to be held by the Institutional Trustee. Distributions in arrears for
more  than  one quarterly period will bear interest thereon compounded quarterly
at the then applicable Coupon Rate for each such quarterly period (to the extent
permitted  by  applicable law). The term "Distributions" as used herein includes
cash  distributions,  any  such  compounded  distributions  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  legally  available  in the Property Account therefor.  Distributions
will  be  computed  on the basis of a 360-day year and the actual number of days
elapsed  in  the  relevant  Distribution  Payment  Period.

     Except as otherwise described below, Distributions on the Common Securities
will  be  cumulative, will accrue from the date of original issuance and will be
payable  quarterly in arrears on March 15, June 15, September 15 and December 15
of  each  year,  commencing  on  March  15,  2006 (each, a "Distribution Payment
Date").  Upon  submission of Notice, and so long as no Event of Default pursuant
to  paragraphs (c), (e) or (f) of Section 5.01 of the Indenture has occurred and
is  continuing  the  Debenture Issuer has the right under the Indenture to defer
payments  of  interest  on the Debentures by extending the interest distribution
period  for up to 20 consecutive quarterly periods (each, an "Extension Period")
at  any  time and from time to time on the Debentures, subject to the conditions
described  below,  during  which  Extension  Period no interest shall be due and
payable (except any Additional Interest that may be due and payable). During any
Extension  Period,  interest  will  continue  to  accrue  on the Debentures, and
interest  on  such  accrued interest (such accrued interest and interest thereon
referred  to  herein as "Deferred Interest") will accrue at an annual rate equal
to  the  Coupon  Rate  in  effect  for  each  such  Extension Period, compounded
quarterly  from  the date such Deferred Interest would have been payable were it
not  for  the  Extension  Period,  to  the extent permitted by 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, Redemption Date (to the extent
redeemed)  or Special Redemption Date. Prior to the termination of any Extension
Period, the Debenture Issuer may further extend such period, provided, that such
period  together  with  all  such  previous  and  further consecutive extensions
thereof  shall not exceed 20 consecutive quarterly periods, or extend beyond the
Maturity  Date, Redemption Date (to the extent redeemed), or  Special Redemption
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 (except
any  Additional  Interest  that may be due and payable) shall be due and payable
during  an  Extension  Period,  except at the end thereof, but Deferred Interest
shall  accrue  upon  each installment of interest that would otherwise have been
due  and payable during such Extension Period until such installment is paid. If
Distributions  are  deferred,  the  Distributions  due shall be paid on the date

                                      A-2-4
<PAGE>
that  the  related  Extension  Period terminates to Holders of the Securities as
they appear on the books and records of the Trust on the record date immediately
preceding  such  date.

     Distributions  on  the  Securities must be paid on the dates payable (after
giving  effect  to  any Extension Period) to the extent that the Trust has funds
legally  available for the payment of such distributions in the Property Account
of  the  Trust.  The  Trust's  funds  legally  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.

                                      A-2-5
<PAGE>
                                   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.

                                      A-2-6EXHIBIT
      4.1

    

     

    SPEEDEMISSIONS,
      INC.

     

    2005
      OMNIBUS STOCK GRANT

    

    AND
      OPTION PLAN 

    

     

    

    

    

    

    

    

    

    

    

      
        
           

        

        
           

          
            

          

        

        
           

          
          

        

      

TABLE
      OF CONTENTS

     

    Page

    
      
        	 	 
	
                SECTION
                  1. PURPOSE.

              	
                1

              
	 	 
	
                SECTION
                  2. DEFINITIONS.

              	
                1

              
	 	
                (a)

              	
                “Award”

              	
                1

              
	 	
                (b)

              	
                “Board
                  of Directors”

              	
                1

              
	 	
                (c)

              	
                “Change
                  in Control”

              	
                1

              
	 	
                (d)

              	
                “Code”

              	
                1

              
	 	
                (e)

              	
                “Committee”

              	
                1

              
	 	
                (f)

              	
                “Common-Law
                  Employee”

              	
                1

              
	 	
                (g)

              	
                “Company”

              	
                2

              
	 	
                (h)

              	
                “Employee”

              	
                2

              
	 	
                (i)

              	
                “Exchange
                  Act”

              	
                2

              
	 	
                (j)

              	
                “Exercise
                  Price”

              	
                2

              
	 	
                (k)

              	
                “Fair
                  Market Value”

              	
                2

              
	 	
                (l)

              	
                “Incentive
                  Stock Option” or “ISO”

              	
                2

              
	 	
                (m)

              	
                “Nonstatutory
                  Option” or “NSO”

              	
                2

              
	 	
                (n)

              	
                “Offeree”

              	
                2

              
	 	
                (o)

              	
                “Option”

              	
                3

              
	 	
                (p)

              	
                “Optionee”

              	
                3

              
	 	
                (q)

              	
                “Outside
                  Director”

              	
                3

              
	 	
                (r)

              	
                “Participant”

              	
                3

              
	 	
                (s)

              	
                “Plan”

              	
                3

              
	 	
                (t)

              	
                “Plan
                  Year”

              	
                3

              
	 	
                (u)

              	
                “Purchase
                  Price”

              	
                3

              
	 	
                (v)

              	
                “Restricted
                  Share”

              	
                3

              
	 	
                (w)

              	
                “Service”

              	
                3

              
	 	
                (x)

              	
                “Share”

              	
                3

              
	 	
                (y)

              	
                “Stock”

              	
                3

              
	 	
                (z)

              	
                “Stock
                  Award Agreement”

              	
                3

              
	 	
                (aa)

              	
                “Stock
                  Option Agreement”

              	
                3

              
	 	
                (bb)

              	
                “Stock
                  Purchase Agreement”

              	
                3

              
	 	
                (cc)

              	
                “Subsidiary”

              	
                3

              
	 	
                (dd)

              	
                “Total
                  and Permanent Disability”

              	
                3

              
	 	
                (ee)

              	
                “W-2
                  Payroll”

              	
                3

              
	 	 
	
                SECTION
                  3. ADMINISTRATION.

              	
                4

              
	 	
                (a)

              	
                Committee
                  Membership

              	
                4

              
	 	
                (b)

              	
                Committee
                  Procedures

              	
                4

              
	 	
                (c)

              	
                Committee
                  Responsibilities

              	
                4

              
	 	
                (d)

              	
                Committee
                  Liability

              	
                4

              
	 	
                (e)

              	
                Financial
                  Reports

              	
                4

              
	 	 
	
                SECTION
                  4. ELIGIBILITY.

              	
                4

              
	 	
                (a)

              	
                General
                  Rule

              	
                4

              
	 	
                (b)

              	
                Ten
                  Percent Shareholders

              	
                4

              
	 	
                (c)

              	
                Attribution
                  Rules

              	
                5

              
	 	
                (d)

              	
                Outstanding
                  Stock

              	
                5

              
	 	 
	
                SECTION
                  5. STOCK SUBJECT TO PLAN.

              	
                5

              
	 	
                (a)

              	
                Basic
                  Limitation

              	
                5

              
	 	
                (b)

              	
                Additional
                  Shares

              	
                5

              

         

         

        
          
             

          

          
            -i-

            
              

            

          

          
             

          

        

         

        
          	
                  SECTION
                    6. TERMS AND CONDITIONS OF AWARDS OR SALES.

                	
                  5

                
	 	
                  (a)

                	
                  Stock
                    Purchase Agreement

                	
                  5

                
	 	
                  (b)

                	
                  Duration
                    of Offers

                	
                  6

                
	 	
                  (c)

                	
                  Purchase
                    Price

                	
                  6

                
	 	
                  (d)

                	
                  Payment
                    for Shares

                	
                  6

                
	 	
                  (e)

                	
                  Exercise
                    of Awards on Termination of Service

                	
                  6

                
	 	 
	
                  SECTION
                    7. ADDITIONAL TERMS AND CONDITIONS OF RESTRICTED

                	
                  6

                
	 	
                  (a)

                	
                  Form
                    and Amount of Award

                	
                  6

                
	 	
                  (b)

                	
                  Exercisability

                	
                  7

                
	 	
                  (c)

                	
                  Effect
                    of Change in Control

                	
                  7

                
	 	
                  (d)

                	
                  Voting
                    Rights

                	
                  7

                
	 	 
	
                  SECTION
                    8. TERMS AND CONDITIONS OF OPTIONS.

                	
                  7

                
	 	
                  (a)

                	
                  Stock
                    Option Agreement

                	
                  7

                
	 	
                  (b)

                	
                  Number
                    of Shares

                	
                  7

                
	 	
                  (c)

                	
                  Exercise
                    Price

                	
                  7

                
	 	
                  (d)

                	
                  Exercisability

                	
                  7

                
	 	
                  (e)

                	
                  Effect
                    of Change in Control

                	
                  7

                
	 	
                  (f)

                	
                  Term

                	
                  8

                
	 	
                  (g)

                	
                  Exercise
                    of Options on Termination of Service

                	
                  8

                
	 	
                  (h)

                	
                  Payment
                    of Option Shares

                	
                  8

                
	 	
                  (i)

                	
                  Modification,
                    Extension and Assumption of Options

                	
                  8

                
	 	 
	
                  SECTION
                    9. ADJUSTMENT OF SHARES.

                	
                  9

                
	 	
                  (a)

                	
                  General

                	
                  9

                
	 	
                  (b)

                	
                  Reorganizations

                	
                  9

                
	 	
                  (c)

                	
                  Reservation
                    of Rights

                	
                  9

                
	 	 
	
                  SECTION
                    10. WITHHOLDING TAXES.

                	
                  9

                
	 	
                  (a)

                	
                  General

                	
                  9

                
	 	
                  (b)

                	
                  Share
                    Withholding

                	
                  9

                
	 	
                  (c)

                	
                  Cashless
                    Exercise/Pledge

                	
                  9

                
	 	
                  (d)

                	
                  Other
                    Forms of Payment

                	
                  9

                
	 	 
	
                  SECTION
                    11. ASSIGNMENT OR TRANSFER OF AWARDS.

                	
                  10

                
	 	
                  (a)

                	
                  General

                	
                  10

                
	 	
                  (b)

                	
                  Trusts

                	
                  10

                
	 	 
	
                  SECTION
                    12. LEGAL REQUIREMENTS.

                	
                  10

                
	 	 
	
                  SECTION
                    13. NO EMPLOYMENT RIGHTS.

                	
                  10

                
	 	 
	
                  SECTION
                    14. DURATION AND AMENDMENTS.

                	
                  10

                
	 	
                  (a)

                	
                  Term
                    of the Plan

                	
                  10

                
	 	
                  (b)

                	
                  Right
                    to Amend or Terminate the Plan

                	
                  10

                
	 	
                  (c)

                	
                  Effect
                    of Amendment or Termination

                	
                  10

                

        

      

     

    
      
         

      

      
        -ii-

        
          

        

      

      
         

        
        

      

    

    SPEEDEMISSIONS,
      INC.

     

    2005
      OMNIBUS STOCK GRANT
      AND OPTION PLAN

     

    

     

    SECTION
      1.   PURPOSE.

     

    The
      purpose of the Speedemissions, Inc. 2005 Omnibus Stock Grant and Option Plan
      (the “Plan”) is to offer selected employees, directors and consultants an
      opportunity to acquire a proprietary interest in the success of the Company,
      or
      to increase such interest, to encourage such selected persons to remain in
      the
      employ of the Company, and to attract new employees with outstanding
      qualifications. The Plan seeks to achieve this purpose by providing for Awards
      in the form of Restricted Shares and Options (which may constitute Incentive
      Stock Options or Nonstatutory Stock Options) as well as the direct award or
      sale
      of Shares of the Company’s Common Stock. Awards may be granted under this Plan
      in reliance upon federal and state securities law exemptions.

     

    SECTION
      2.   DEFINITIONS.

     

    (a)    “Award”
      shall
      mean any award of an Option, Restricted Share or other right under the
      Plan.

     

    (b)    “Board
      of Directors”
      shall
      mean the Board of Directors of the Company, as constituted from time to
      time.

     

    (c)    “Change
      in Control”
      shall
      mean:

     

    (i)    The
      consummation of a merger, consolidation, sale of the Company’s stock, or other
      reorganization of the Company (other than a reincorporation of the Company),
      if
      after giving effect to such merger, consolidation or other reorganization of
      the
      Company, the stockholders of the Company immediately prior to such merger,
      consolidation or other reorganization do not represent a majority interest
      of
      the holders of voting securities (on a fully diluted basis) with the ordinary
      voting power to elect directors of the surviving or resulting entity after
      such
      merger, consolidation or other reorganization; or

     

    (ii)    The
      sale
      of all or substantially all of the assets of the Company to a third party who
      is
      not an affiliate of the Company.

     

    (iii)    The
      term
      Change in Control shall not include: (a) a transaction the sole purpose of
      which
      is to change the state of the Company’s incorporation, or (b) the Company’s
      initial public offering.

     

    (d)    “Code”
      shall
      mean the Internal Revenue Code of 1986, as amended.

     

    (e)    “Committee”
      shall
      mean the Compensation Committee of the Board of Directors or any other committee
      which is authorized by the Board of Directors to administer the Plan under
      Section 3.

     

    (f)    “Common-Law
      Employee”
      shall
      mean an individual paid from W-2 Payroll of the Company or a Subsidiary. If,
      during any period, the Company (or Subsidiary, as applicable) has not treated
      an
      individual as a Common-Law Employee and, for that reason, has not paid such
      individual in a manner which results in the issuance of a Form W-2 and withheld
      taxes with respect to him or her, then that individual shall not be an eligible
      Employee for that period, even if any person, court of law or government agency
      determines, retroactively, that that individual is or was a Common-Law Employee
      during all or any portion of that period.

     

    
      
         

      

      
        -1-

        
          

        

      

      
         

      

    

     

    (g)    “Company”
      shall
      mean Speedemissions, Inc., a Florida corporation.

     

    (h)    “Employee”
      shall
      mean (i) any individual who is a Common - Law Employee of the Company or of
      a
      Subsidiary,
      (ii)
      a member
      of the Board of Directors, including (without limitation) an Outside Director,
      or an affiliate of a member of the Board of Directors,
      (iii)
      a member
      of the board of directors of a Subsidiary, or
      (iv)
      an
      independent contractor who performs services for the Company or a Subsidiary.
      Service as a member of the Board of Directors, a member of the board of
      directors of a Subsidiary or an independent contractor shall be considered
      employment for all purposes of the Plan except the second sentence of Section
      4(a).

     

    (i)    “Exchange
      Act”
      means
      the Securities and Exchange Act of 1934, as amended.

     

    (j)    “Exercise
      Price”
      shall
      mean the amount for which one Share may be purchased upon exercise of an Option,
      as specified by the Committee in the applicable Stock Option
      Agreement.

     

    (k)    “Fair
      Market Value”
      means
      the market price of Shares, determined by the Committee as follows:

     

    (i)    If
      the
      Shares were traded over-the-counter on the date in question but were not traded
      on the Nasdaq Stock Market or the Nasdaq National Market System, then the Fair
      Market Value shall be equal to the last trade price or the closing bid price
      for
      the stock as quoted on such date;

     

    (ii)    If
      the
      Shares were traded over-the-counter on the date in question and were traded
      on
      the Nasdaq Stock Market or the Nasdaq National Market System, then the Fair
      Market Value shall be equal to the last-transaction price quoted for such date
      by the Nasdaq Stock Market or the Nasdaq National Market;

     

    (iii)    If
      the
      Shares were traded on a stock exchange on the date in question, then the Fair
      Market Value shall be equal to the closing price reported by the applicable
      composite transactions report for such date; and

     

    (iv)    If
      none
      of the foregoing provisions is applicable, then the Fair Market Value shall
      be
      determined by the Committee in good faith on such basis as it deems
      appropriate.

     

    In
      all
      cases, the determination of Fair Market Value by the Committee shall be
      conclusive and binding on all persons.

     

    (l)    “Incentive
      Stock Option” or “ISO”
      shall
      mean an employee incentive stock option described in Code section
      422(b).

     

    (m)    “Nonstatutory
      Option” or “NSO”
      shall
      mean an employee stock option that is not an ISO.

     

    (n)    “Offeree”
      shall
      mean an individual to whom the Committee has offered the right to acquire Shares
      under the Plan (other than upon exercise of an Option).

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

     

    (o)    “Option”
      shall
      mean an Incentive Stock Option or Nonstatutory Option granted under the Plan
      and
      entitling the holder to purchase Shares.

     

    (p)    “Optionee”
      shall
      mean an individual or estate who holds an Option.

     

    (q)    “Outside
      Director”
      shall
      mean a member of the Board who is not a Common - Law Employee of the Company
      or
      a Subsidiary.

     

    (r)    “Participant”
      shall
      mean an individual or estate who holds an Award.

     

    (s)    “Plan”
      shall
      mean this 2005 Omnibus Stock Grant and Option Plan of Speedemissions,
      Inc..

     

    (t)    “Plan
      Year”
shall
      mean any twelve (12) month period (or shorter period during the final year
      of
      this Plan) commencing September 1 during the term of this Plan.

     

    (u)    “Purchase
      Price”
      shall
      mean the consideration for which one Share may be acquired under the Plan (other
      than upon exercise of an Option), as specified by the Committee.

     

    (v)    “Restricted
      Share”
      shall
      mean a Share sold or granted to an eligible Employee which is nontransferable
      and subject to substantial risk of forfeiture until restrictions
      lapse.

     

    (w)    “Service”
      shall
      mean service as an Employee.

     

    (x)    “Share”
      shall
      mean one share of Stock, as adjusted in accordance with Section 9 (if
      applicable).

     

    (y)    “Stock”
      shall
      mean the common stock of the Company.

     

    (z)    “Stock
      Award Agreement”
      shall
      mean the agreement between the Company and the recipient of a Restricted Share
      which contains the terms, conditions and restrictions pertaining to such
      Restricted Share.

     

    (aa)    “Stock
      Option Agreement”
      shall
      mean the agreement between the Company and an Optionee which contains the terms,
      conditions and restrictions pertaining to his or her Option.

     

    (bb)    “Stock
      Purchase Agreement”
      shall
      mean the agreement between the Company and an Offeree who acquires Shares under
      the Plan which contains the terms, conditions and restrictions pertaining to
      the
      acquisition of such Shares.

     

    (cc)    “Subsidiary”
      means
      any corporation (other than the Company) in an unbroken chain of corporations
      beginning with the Company, if each of the corporations other than the last
      corporation in the unbroken chain owns stock possessing 50% or more of the
      total
      combined voting power of all classes of stock in one of the other corporations
      in such chain. A corporation that attains the status of a Subsidiary on a date
      after the adoption of the Plan shall be considered a Subsidiary commencing
      as of
      such date.

     

    (dd)    “Total
      and Permanent Disability”
      means
      that the Optionee is unable to engage in any substantial gainful activity by
      reason of any medically determinable physical or mental impairment.

     

    (ee)    “W-2
      Payroll”
      means
      whatever mechanism or procedure that the Company or a Subsidiary utilizes to
      pay
      any individual which results in the issuance of Form W-2 to the individual.
“W-2
      Payroll” does not include any mechanism or procedure which results in the
      issuance of any form other than a Form W-2 to an individual, including, but
      not
      limited to, any Form 1099 which may be issued to an independent contractor,
      an
      agency employee or a consultant. Whether a mechanism or procedure qualifies
      as a
“W-2 Payroll” shall be determined in the absolute discretion of the Company (or
      Subsidiary, as applicable), and the Company or Subsidiary determination shall
      be
      conclusive and binding on all persons.

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

     

    SECTION
      3.   ADMINISTRATION.

     

    (a)    Committee
      Membership.
      The
      Plan shall be administered by the Compensation Committee (the “Committee”)
      appointed by the Company’s Board of Directors and comprised of at least two or
      more Directors (although Committee functions may be delegated to officers to
      the
      extent the awards relate to persons who are not subject to the reporting
      requirements of Section 16 of the Exchange Act). If no Committee has been
      appointed, the entire Board shall constitute the Committee.

     

    (b)    Committee
      Procedures.
      The
      Board of Directors shall designate one of the members of the Committee as
      chairperson. The Committee may hold meetings at such times and places as it
      shall determine. The acts of a majority of the Committee members present at
      meetings at which a quorum exists, or acts reduced to or approved in writing
      by
      all Committee members, shall be valid acts of the Committee.

     

    (c)    Committee
      Responsibilities.
      The
      Committee has and may exercise such power and authority as may be necessary
      or
      appropriate for the Committee to carry out its functions as described in the
      Plan. The Committee has authority in its discretion to determine eligible
      Employees to whom, and the time or times at which, Awards may be granted and
      the
      number of Shares subject to each Award. Subject to the express provisions of
      the
      respective Award agreements (which need not be identical) and to make all other
      determinations necessary or advisable for Plan administration, the Committee
      has
      authority to prescribe, amend, and rescind rules and regulations relating to
      the
      Plan. All interpretations, determinations, and actions by the Committee will
      be
      final, conclusive, and binding upon all persons.

     

    (d)    Committee
      Liability.
      No
      member of the Board or the Committee will be liable for any action or
      determination made in good faith by the Committee with respect to the Plan
      or
      any Award made under the Plan.

     

    (e)    Financial
      Reports.
      To the
      extent required by applicable law, and not less often than annually, the Company
      shall furnish to Offerees, Optionees and Shareholders who have received Stock
      under the Plan its financial statements including a balance sheet regarding
      the
      Company’s financial condition and results of operations, unless such Offerees,
      Optionees or Shareholders have duties with the Company that assure them access
      to equivalent information. Such financial statements need not be
      audited.

     

    SECTION
      4.   ELIGIBILITY.

     

    (a)    General
      Rule.
      Only
      Employees shall be eligible for designation as Participants by the Committee.
      In
      addition, only individuals who are employed as Common - Law Employees by the
      Company or a Subsidiary shall be eligible for the grant of ISOs.

     

    (b)    Ten-Percent
      Shareholders.
      An
      Employee who owns more than ten percent (10%) of the total combined voting
      power
      of all classes of outstanding stock of the Company or any of its Subsidiaries
      shall not be eligible for designation as an Offeree or Optionee unless (i)
      the
      Exercise Price for an ISO (and a NSO to the extent required by applicable law)
      is at least one hundred ten percent (110%) of the Fair Market Value of a Share
      on the date of grant, (ii) if required by applicable law, the Purchase Price
      of
      Shares is at least one hundred percent (100%) of the Fair Market Value of a
      Share on the date of grant, and (iii) in the case of an ISO, such ISO by its
      terms is not exercisable after the expiration of ten years from the date of
      grant.

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

     

    (c)    Attribution
      Rules.
      For
      purposes of Subsection (b) above, in determining stock ownership, an Employee
      shall be deemed to own the stock owned, directly or indirectly, by or for his
      brothers, sisters, spouse, ancestors and lineal descendants. Stock owned,
      directly or indirectly, by or for a corporation, partnership, estate or trust
      shall be deemed to be owned proportionately by or for its shareholders, partners
      or beneficiaries. Stock with respect to which such Employee holds an Option
      shall not be counted.

     

    (d)    Outstanding
      Stock.
      For
      purposes of Subsection (b) above, “outstanding stock” shall include all stock
      actually issued and outstanding immediately after the grant. “Outstanding Stock”
shall not include shares authorized for issuance under outstanding Options
      held
      by the Employee or by any other person.

     

    SECTION
      5.   STOCK
      SUBJECT TO PLAN.

     

    (a)    Basic
      Limitation.
      Shares
      offered under the Plan shall be authorized but unissued Shares. Subject to
      Sections 5(b) and 9 of the Plan, the aggregate number of Shares which may be
      issued or transferred as common stock pursuant to an Award under the Plan shall
      not exceed Two Million Five Hundred Thousand (2,500,000) shares of Authorized
      Common Stock of the Company. Notwithstanding the above, on September 1 of each
      Plan Year, the number of shares that can be awarded under the Plan shall
      automatically be adjusted to an amount equal to ten percent (10%) of the
      outstanding Common Stock of the Company on August 31 of the immediately
      preceding year.

     

    In
      any
      event, the number of Shares which are subject to Awards or other rights
      outstanding at any time under the Plan shall not exceed the number of Shares
      which then remain available for issuance under the Plan. The Company, during
      the
      term of the Plan, shall at all times reserve and keep available sufficient
      Shares to satisfy the requirements of the Plan.

    

    (b)    Additional
      Shares.
      In the
      event that any outstanding Option or other right for any reason expires or
      is
      canceled or otherwise terminated, the Shares allocable to the unexercised
      portion of such Option or other right shall again be available for the purposes
      of the Plan. If a Restricted Share is forfeited before any dividends have been
      paid with respect to such Restricted Share, then such Restricted Share shall
      again become available for award under the Plan.

     

    SECTION
      6.   TERMS
      AND CONDITIONS OF AWARDS OR SALES.

     

    (a)    Stock
      Purchase Agreement.
      Each
      award or sale of Shares under the Plan (other than upon exercise of an Option)
      shall be evidenced by a Stock Purchase Agreement between the Offeree and the
      Company. Such award or sale shall be subject to all applicable terms and
      conditions of the Plan and may be subject to any other terms and conditions
      which are not inconsistent with the Plan and which the Committee deems
      appropriate for inclusion in a Stock Purchase Agreement. The provisions of
      the
      various Stock Purchase Agreements entered into under the Plan need not be
      identical.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

     

    (b)    Duration
      of Offers.
      Any
      right to acquire Shares under the Plan (other than an Option) shall
      automatically expire if not exercised by the Offeree within thirty (30) days
      after the grant if such right was communicated to the Offeree by the
      Committee.

     

    (c)    Purchase
      Price.
      Unless
      otherwise permitted by applicable law, the Purchase Price of Shares to be
      offered under the Plan shall not be less than eighty-five percent (85%) of
      the
      Fair Market Value of a Share on the date of grant (100% for 10% shareholders),
      except as otherwise provided in Section 4(b). Subject to the preceding sentence,
      the Purchase Price shall be determined by the Committee in its sole discretion.
      The Purchase Price shall be payable in a form described in Subsection (d)
      below.

     

    (d)    Payment
      for Shares.
      The
      entire Purchase Price of Shares issued under the Plan shall be payable in lawful
      money of the United States of America at the time when such Shares are
      purchased, except as provided below:

     

    (i)    Surrender
      of Stock.
      To the
      extent that a Stock Option Agreement so provides, payment may be made all or
      in
      part with Shares which have already been owned by the Optionee or Optionee’s
      representative for any time period specified by the Committee and which are
      surrendered to the Company in good form for transfer. Such shares shall be
      valued at their Fair Market Value on the date when the new Shares are purchased
      under the Plan.

     

    (ii)    Promissory
      Notes.
      To the
      extent that a Stock Option Agreement or Stock Purchase Agreement so provides,
      and as permitted by applicable law, payment may be made all or in part with
      a
      full recourse promissory note executed by the Optionee or Offeree. The interest
      rate and other terms and conditions of such note shall be determined by the
      Committee. The Committee may require that the Optionee or Offeree pledge his
      or
      her Shares to the Company for the purpose of securing the payment of such note.
      In no event shall the stock certificate(s) representing such Shares be released
      to the Optionee or Offeree until such note is paid in full.

     

    (iii)    Cashless
      Exercise.
      To the
      extent that a Stock Option Agreement so provides and a public market for the
      Shares exists, payment may be made all or in part by delivery (on a form
      prescribed by the Committee) of an irrevocable direction to a securities broker
      to sell shares and to deliver all or part of the sale proceeds to the Company
      in
      payment of the aggregate Exercise Price.

     

    (iv)    Other
      Forms of Payment.
      To the
      extent provided in the Stock Option Agreement, payment may be made in any other
      form that is consistent with applicable laws, regulations and
      rules.

     

    (e)    Exercise
      of Awards on Termination of Service.
      Each
      Stock Award Agreement shall set forth the extent to which the recipient shall
      have the right to exercise the Award following termination of the recipient’s
      Service with the Company and its Subsidiaries. Such provisions shall be
      determined in the sole discretion of the Committee, need not be uniform among
      all the Awards issued pursuant to the Plan, and may reflect distinctions based
      on the reasons for termination of employment.

     

    SECTION
      7.   ADDITIONAL
      TERMS AND CONDITIONS OF RESTRICTED
      SHARES. 

    

    (a)    Form
      and Amount of Award.
      Each
      Stock Award Agreement shall specify the number of Shares that are subject to
      the
      Award. Restricted Shares may be awarded in combination with NSOs and such an
      Award may provide that the Restricted Shares will be forfeited in the event
      that
      the related NSOs are exercised.

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    

    (b)    Exercisability.
      Each
      Stock Award Agreement shall specify the conditions upon which Restricted Shares
      shall become vested, in full or in installments. To the extent required by
      applicable law, each Stock Award shall become exercisable no less rapidly than
      the rate of 20% per year for each of the first five years from the date of
      grant. Subject to the preceding sentence, the exercisability of any Stock Award
      shall be determined by the Committee in its sole discretion.

     

    (c)    Effect
      of Change in Control.
      The
      Committee may determine at the time of making an Award or thereafter, that
      such
      Award shall become fully vested, in whole or in part, in the event that a Change
      in Control occurs with respect to the Company.

     

    (d)    Voting
      Rights.
      Holders
      of Restricted Shares awarded under the Plan shall have the same voting, dividend
      and other rights as the Company’s other stockholders. A Stock Award Agreement,
      however, may require that the holders invested any cash dividends received
      in
      additional Restricted Shares. Such additional Restricted Shares shall be subject
      to the same conditions and restrictions as the Award with respect to which
      the
      dividends were paid. Such additional Restricted Shares shall not reduce the
      number of Shares available under Section 5.

     

    SECTION
      8.   TERMS
      AND CONDITIONS OF OPTIONS.

     

    (a)    Stock
      Option Agreement.
      Each
      grant of an Option under the Plan shall be evidenced by a Stock Option Agreement
      between the Optionee and the Company. Such Option shall be subject to all
      applicable terms and conditions of the Plan and may be subject to any other
      terms and conditions which are not inconsistent with the Plan and which the
      Committee deems appropriate for inclusion in a Stock Option Agreement. The
      provisions of the various Stock Option Agreements entered into under the Plan
      need not be identical.

     

    (b)    Number
      of Shares.
      Each
      Stock Option Agreement shall specify the number of Shares that are subject
      to
      the Option and shall provide for the adjustment of such number in accordance
      with Section 9. The Stock Option Agreement shall also specify whether the Option
      is an ISO or a Nonstatutory Option.

     

    (c)    Exercise
      Price.
      Each
      Stock Option Agreement shall specify the Exercise Price. The Exercise Price
      of
      an ISO shall not be less than one hundred percent (100%) of the Fair Market
      Value of a Share on the date of grant, except as otherwise provided in Section
      4(b). Except as otherwise provided in Section 4(b), the Exercise Price of a
      Nonstatutory Option is not subject to any minimum price and the exercise price
      does not have to be determined based on the Fair Market Value of a Share.
      Subject to the preceding two sentences, the Exercise Price under any Option
      shall be determined by the Committee in its sole discretion. The Exercise Price
      shall be payable in a form described in Subsection (h) below.

     

    (d)    Exercisability.
      Each
      Stock Option Agreement shall specify the date when all or any installment of
      the
      Option is to become exercisable. To the extent required by applicable law,
      an
      Option shall become exercisable no less rapidly than the rate of 20% per year
      for each of the first five years from the date of grant. Subject to the
      preceding sentence, the exercisability of any Option shall be determined by
      the
      Committee in its sole discretion.

     

    (e)    Effect
      of Change in Control.
      The
      Committee may determine, at the time of granting an Option or thereafter, that
      such Option shall become fully exercisable as to all Shares subject to such
      Option in the event that a Change in Control occurs with respect to the
      Company.

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     

    (f)    Term.
      The
      Stock Option Agreement shall specify the term of the Option. The term shall
      not
      exceed ten (10) years from the date of grant. Subject to the preceding sentence,
      the Committee at its sole discretion shall determine when an Option is to
      expire.

     

    (g)    Exercise
      of Options on Termination of Service.
      Each
      Option shall set forth the extent to which the Optionee shall have the right
      to
      exercise the Option following termination of the Optionee’s Service with the
      Company and its Subsidiaries. Such provisions shall be determined in the sole
      discretion of the Committee, need not be uniform among all Options issued
      pursuant to the Plan, and may reflect distinctions based on the reasons for
      termination of employment. Notwithstanding the foregoing, to the extent required
      by applicable law, each Option shall provide that the Optionee shall have the
      right to exercise the vested portion of any Option held at termination for
      at
      least 60 days following termination of Service with the Company for any reason,
      and that the Optionee shall have the right to exercise the Option for at least
      six months if the Optionee’s Service terminates due to death or
      Disability.

     

    (h)    Payment
      of Option Shares.
      The
      entire Exercise Price of Shares issued under the Plan shall be payable in lawful
      money of the United States of America at the time when such Shares are
      purchased, except as provided below:

     

    (i)    Surrender
      of Stock.
      To the
      extent that a Stock Option Agreement so provides, payment may be made all or
      in
      part with Shares which have already been owned by the Optionee or Optionee’s
      representative for any time period specified by the Committee and which are
      surrendered to the Company in good form for transfer. Such shares shall be
      valued at their Fair Market Value on the date when the new Shares are purchased
      under the Plan.

     

    (ii)    Promissory
      Notes.
      To the
      extent that a Stock Option Agreement or Stock Purchase Agreement so provides,
      and to the extent allowable to applicable law, payment may be made all or in
      part with a full recourse promissory note executed by the Optionee or Offeree.
      The interest rate and other terms and conditions of such note shall be
      determined by the Committee. The Committee may require that the Optionee or
      Offeree pledge his or her Shares to the Company for the purpose of securing
      the
      payment of such note. In no event shall the stock certificate(s) representing
      such Shares be released to the Optionee or Offeree until such note is paid
      in
      full.

     

    (iii)    Cashless
      Exercise.
      To the
      extent that a Stock Option Agreement so provides and a public market for the
      Shares exists, payment may be made all or in part by delivery (on a form
      prescribed by the Committee) of an irrevocable direction to a securities broker
      to sell shares and to deliver all or part of the sale proceeds to the Company
      in
      payment of the aggregate Exercise Price.

     

    (iv)    Other
      Forms of Payment.
      To the
      extent provided in the Stock Option Agreement, payment may be made in any other
      form that is consistent with applicable laws, regulations and
      rules.

     

    (i)    Modification,
      Extension and Assumption of Options.
      Within
      the limitations of the Plan, the Committee may modify, extend or assume
      outstanding Options or may accept the cancellation of outstanding Options
      (whether granted by the Company or another issuer) in return for the grant
      of
      new Options for the same or a different number of Shares and at the same or
      a
      different Exercise Price or for other consideration.

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    SECTION
      9.   ADJUSTMENT
      OF SHARES.

     

    (a)    General.
      In the
      event of a subdivision of the outstanding Stock, a declaration of a dividend
      payable in Shares, a combination or consolidation of the outstanding Stock
      into
      a lesser number of Shares, a recapitalization, a reclassification or a similar
      occurrence, the Committee shall make appropriate adjustments, subject to the
      limitations set forth in Section 9(c), in one or more of (i) the number of
      Shares available for future Awards under Section 5, (ii) the number of Shares
      covered by each outstanding Option or Purchase Agreement or (iii) the Exercise
      Price or Purchase Price under each outstanding Option or Stock Purchase
      Agreement.

     

    (b)    Reorganizations.
      In the
      event that the Company is a party to a merger or reorganization, outstanding
      Options shall be subject to the agreement of merger or reorganization, provided
      however, that the limitations set forth in Section 9(c) shall
      apply.

     

    (c)    Reservation
      of Rights.
      Except
      as provided in this Section 9, an Optionee or an Offeree shall have no rights
      by
      reason of (i) any subdivision or consolidation of shares of stock of any class,
      (ii) the payment of any dividend or (iii) any other increase or decrease in
      the
      number of shares of stock of any class. Any issue by the Company of shares
      of
      stock of any class, or securities convertible into shares of stock of any class,
      shall not affect, and no adjustment by reason thereof shall be made with respect
      to, the number, Exercise Price or Purchase Agreement of Shares subject to an
      Option or Stock Purchase Agreement. The grant of an Award pursuant to the Plan
      shall not affect in any way the right or power of the Company to make
      adjustments, reclassifications, reorganizations or changes of its capital or
      business structure, to merge or consolidate or to dissolve, liquidate, sell
      or
      transfer all or any part of its business or assets.

     

    SECTION
      10.   WITHHOLDING
      TAXES.

     

    (a)    General.
      To the
      extent required by applicable federal, state, local or foreign law, a
      Participant or his or her successor shall make arrangements satisfactory to
      the
      Committee for the satisfaction of any withholding tax obligations that arise
      in
      connection with the Plan. The Company shall not be required to issue any Shares
      or make any cash payment under the Plan until such obligations are
      satisfied.

     

    (b)    Share
      Withholding.
      The
      Committee may permit a Participant to satisfy all or part of his or her
      withholding or income tax obligations by having the Company withhold all or
      a
      portion of any Shares that otherwise would be issued to him or her or by
      surrendering all or a portion of any Shares that he or she previously acquired.
      Such Shares shall be valued at their Fair Market Value on the date when taxes
      otherwise would be withheld in cash. Any payment of taxes by assigning Shares
      to
      the Company may be subject to restrictions, including any restrictions required
      by rules of any federal or state regulatory body or other
      authority.

     

    (c)    Cashless
      Exercise/Pledge.
      The
      Committee may provide that if Company Shares are publicly traded at the time
      of
      exercise, arrangements may be made to meet the Optionee’s withholding obligation
      by cashless exercise or pledge.

     

    (d)    Other
      Forms of Payment.
      The
      Committee may permit such other means of tax withholding as it deems
      appropriate.

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

     

    SECTION
      11.   ASSIGNMENT
      OR TRANSFER OF AWARDS.

     

    (a)    General.
      An
      Award granted under the Plan shall not be anticipated, assigned, attached,
      garnished, optioned, transferred or made subject to any creditor’s process,
      whether voluntarily, involuntarily or by operation of law, except as approved
      by
      the Committee. Notwithstanding the foregoing, ISOs may not be transferable.
      Also
      notwithstanding the foregoing, Offerees and Optionees may not transfer their
      rights hereunder except by will, beneficiary designation or the laws of descent
      and distribution.

     

    (b)    Trusts.
      Neither
      this Section 11 nor any other provision of the Plan shall preclude a Participant
      from transferring or assigning Restricted Shares to (a) the trustee of a trust
      that is revocable by such Participant alone, both at the time of the transfer
      or
      assignment and at all times thereafter prior to such Participant’s death, or (b)
      the trustee of any other trust to the extent approved by the Committee in
      writing. A transfer or assignment of Restricted Shares from such trustee to
      any
      other person than such Participant shall be permitted only to the extent
      approved in advance by the Committee in writing, and Restricted Shares held
      by
      such trustee shall be subject to all the conditions and restrictions set forth
      in the Plan and in the applicable Stock Award Agreement, as if such trustee
      were
      a party to such Agreement.

     

    SECTION
      12.   LEGAL
      REQUIREMENTS.

     

    Shares
      shall not be issued under the Plan unless the issuance and delivery of such
      Shares complies with (or is exempt from) all applicable requirements of law,
      including (without limitation) the Securities Act of 1933, as amended, the
      rules
      and regulations promulgated thereunder, state securities laws and regulations,
      and the regulations of any stock exchange on which the Company’s securities may
      then be listed.

     

    SECTION
      13.   NO
      EMPLOYMENT RIGHTS.

     

    No
      provision of the Plan, nor any right or Option granted under the Plan, shall
      be
      construed to give any person any right to become, to be treated as, or to remain
      an Employee. The Company and its Subsidiaries reserve the right to terminate
      any
      person’s Service at any time and for any reason.

     

    SECTION
      14.   DURATION
      AND AMENDMENTS.

     

    (a)    Term
      of the Plan.
      The
      Plan, as set forth herein, shall become effective on the date of its adoption
      by
      the Board of Directors, subject to the approval of the Company’s shareholders.
      In the event that the shareholders fail to approve the Plan within twelve (12)
      months after its adoption by the Board of Directors, any grants already made
      shall be null and void, and no additional grants shall be made after such date.
      The Plan shall terminate automatically ten (10) years after its adoption by
      the
      Board of Directors and may be terminated on any earlier date pursuant to
      Subsection (b) below.

     

    (b)    Right
      to Amend or Terminate the Plan.
      The
      Board of Directors may amend the Plan at any time and from time to time. Rights
      and obligations under any right or Option granted before amendment of the Plan
      shall not be materially altered, or impaired adversely, by such amendment,
      except with consent of the person to whom the right or Option was granted.
      An
      amendment of the Plan shall be subject to the approval of the Company’s
      shareholders only to the extent required by applicable laws, regulations or
      rules including the rules of any applicable exchange.

     

    (c)    Effect
      of Amendment or Termination.
      No
      Shares shall be issued or sold under the Plan after the termination thereof,
      except upon exercise of an Option granted prior to such termination. The
      termination of the Plan, or any amendment thereof, shall not affect any Shares
      previously issued or any Option previously granted under the Plan.

     

    

    [END
      OF PLAN]

     

     

    
      
         

      

        -10-

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