Document:

Exhibit
10.2

COLLAGENEX PHARMACEUTICALS, INC.

CHANGE OF CONTROL AGREEMENT

This Change of
Control Agreement (the “Agreement”) is made and entered into effective as of                      ,
20    (the “Effective Date”), by and between                         
(the “Employee”) and CollaGenex Pharmaceuticals, Inc., a Delaware corporation (“CollaGenex”).  Certain capitalized terms used in this
Agreement are defined in Section 1 below.

R E C I T A L S

A.            It is expected that CollaGenex from
time to time will consider the possibility of a Change of Control, as defined
in this Agreement.  The Board of
Directors of CollaGenex (the “Board”) recognizes that such consideration can be
a distraction to the Employee and can cause the Employee to consider
alternative employment opportunities.

B.            The Board believes that it is in the
best interests of CollaGenex and its stockholders to provide the Employee with
an incentive to continue his or her employment and to maximize the value of
CollaGenex upon a Change of Control for the benefit of its stockholders.

C.            In order to encourage the Employee
to remain with CollaGenex notwithstanding the possibility of a Change of
Control, the Board believes that it is imperative to provide the Employee with
certain severance benefits upon the Employee’s termination of employment under
certain circumstances following a Change of Control.

D.            This agreement supersedes any and
all prior agreements that have as their primary purpose the provision of
benefits upon termination of employment under certain circumstances following a
Change of Control.

AGREEMENT

In consideration
of the mutual covenants contained in this Agreement and the continued
employment of Employee by CollaGenex, the parties agree as follows:

 

1.             Definition
of Terms.  The following terms
referred to in this Agreement shall have the following meanings:

(a)           Cause.  “Cause” shall mean (i) any act of dishonesty
taken by the Employee in connection with his or her responsibilities as an
employee which is intended to result in personal enrichment of the Employee,
(ii) Employee’s conviction of a felony that the Board believes has had or will
have a material detrimental effect on CollaGenex’ reputation or business, (iii)
a willful act or willful failure to act by the Employee that constitutes
misconduct and is injurious to CollaGenex, (iv) any material breach by Employee
of any agreement with CollaGenex, after there has been delivered to the
Employee a written notice of breach and Employee has been given a reasonable
opportunity to cure such breach, or (v) continued willful violations by the
Employee of the Employee’s obligations to CollaGenex or responsibilities/duties
as an employee after there has been delivered to the Employee a written demand
for performance from CollaGenex which describes the basis for CollaGenex’
belief that the Employee has not substantially performed his or her duties, and
Employee has been given a reasonable opportunity to cure the violations.

(b)           Change
of Control.  “Change of Control”
shall mean the occurrence of any of the following events:

(i)            the
approval by CollaGenex’ shareholders of a merger or consolidation of CollaGenex
with any other corporation, other than a merger or consolidation which would
result in the voting securities of CollaGenex outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more than fifty
percent (50%) of the total voting power represented by the voting securities of
CollaGenex or such surviving entity outstanding immediately after such merger
or consolidation;

(ii)           the
approval by CollaGenex’ shareholders of a plan of complete liquidation of
CollaGenex or an agreement for the sale or disposition by CollaGenex of all or
substantially all of CollaGenex’ assets;

(iii)          any
“person” (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended) becoming the “beneficial owner” (as defined
in Rule 13d-3 under said

 2
 

 

Act), directly or indirectly, of securities
of CollaGenex representing 50% or more of the total voting power represented by
CollaGenex’ then outstanding voting securities; or

(iv)          a
change in the composition of the Board, as a result of which fewer than a
majority of the directors are Incumbent Directors.  “Incumbent Directors” shall mean directors
who either (A) are directors of CollaGenex as of the date hereof, or (B) are
elected, or nominated for election, to the Board with the affirmative votes of
at least a majority of those directors whose election or nomination was not
either in connection with any transactions described in subsections (i), (ii),
or (iii), or in connection with an actual or threatened proxy contest relating
to the election of directors of CollaGenex.

(c)          
Involuntary Termination  “Involuntary
Termination” shall mean (i) without the Employee’s express written consent, a
significant reduction of the Employee’s duties, position or responsibilities
relative to the Employee’s duties, position or responsibilities in effect immediately
prior to such reduction, or the removal of the Employee from such position,
duties and responsibilities, unless the Employee is provided with comparable
duties, position and responsibilities; 
(ii) without the Employee’s express written consent, a significant
reduction, without good business reasons, of the facilities and perquisites
(including office space and location) available to the Employee immediately
prior to such reduction; (iii) without the Employee’s express written consent,
a reduction by CollaGenex of the Employee’s base salary as in effect
immediately prior to such reduction; (iv) without the Employee’s express
written consent, a material reduction by CollaGenex in the kind or level of
employee benefits to which the Employee is entitled immediately prior to such
reduction with the result that the Employee’s overall benefits package is
significantly reduced; (v) without the Employee’s express written consent, the
relocation of the Employee to a facility or a location more than fifty (50)
miles from his or her current location; (vi) any termination of the Employee by
CollaGenex that is not effected for Cause or for which the grounds relied upon
are not valid; or (vii) the failure of CollaGenex to obtain the assumption of
this Agreement by any successors contemplated in Section 7 below.

(d)           Termination
Date.  “Termination Date” shall mean
the effective date of any notice of termination delivered by one party to the
other under this Agreement.

 3
 

 

2.             Term
of Agreement.  This Agreement shall
terminate on the earlier of (a) the date that all obligations of the parties
under this Agreement have been satisfied or (b) on the date, prior to a Change
of Control, the Employee is no longer employed by CollaGenex.

3.             At-Will
Employment.  CollaGenex and the
Employee acknowledge that the Employee’s employment is and shall continue to be
at-will, as defined under applicable law. 
If, prior to any Change of Control, the Employee leaves the employment
of CollaGenex either voluntarily or involuntarily for any reason, this
Agreement will terminated by Operation of Section 2 and the Employee shall not
be entitled to any payments, benefits, damages, awards or compensation other
than as may otherwise be established under CollaGenex’ then existing employee
benefit plans or policies at the Termination Date, or as otherwise agreed by
the parties at such time.

4.             Option
Acceleration Upon A Change of Control. 
If a Change of Control occurs while the Employee is employed by
CollaGenex, regardless of whether Employee’s employment relationship with
CollaGenex continues following such Change of Control, then (a) all stock
options granted by CollaGenex to the Employee prior to the Change of Control
shall become fully vested and exercisable as of the date of the Change of
Control to the extent such stock options are outstanding and unexercisable at
the time of such termination, and (b) all stock subject to a right of
repurchase by CollaGenex (or its successor) that was purchased prior to the
Change of Control shall have such right of repurchase lapse with respect to all
of such shares.

5.             Severance
Benefits In the Event of an Involuntary Termination.

(a)           Termination
Following A Change of Control.  If
the Employee’s employment with CollaGenex terminates as a result of an
Involuntary Termination at any time within twenty-four (24) months after a
Change of Control, Employee shall be entitled to the following severance
benefits:

(i)            2
(two) times the Employee’s base salary as in effect as of the Termination Date,
plus an amount equal to 2 (two) times the average bonus paid to Employee for
the three fiscal years prior to the Termination Date (pro rated in the event
Employee’s duration of employment by CollaGenex resulted in less than three
bonus payments), less applicable withholding, payable in a lump sum within
thirty (30) days of the Termination Date; provided, however, if Employee has

 4
 

 

not worked long enough to have received a
bonus for a full year of employment, an amount equal to 2 (two) times the
maximum bonus opportunity for the year in which employment is terminated shall
be substituted for the payment based on average bonus payments referred to
above in this subparagraph;

(ii)           the
same level of health (i.e., medical, vision and dental) coverage and benefits
as in effect for the Employee on the day immediately preceding the day of the
Employee’s termination of employment for a period of twenty-four (24) months;
and

(iii)          outplacement/administrative
support for a period of eighteen (18) months following the Termination Date,
plus reimbursement of up to Five Thousand Dollars ($5,000) of out of pocket
expenses incurred by Employee in connection with Employee’s job search.

(b)           Termination
Apart from a Change of Control.  If
the Employee’s employment with CollaGenex terminates other than as a result of
an Involuntary Termination within twenty-four (24) months following a Change of
Control, then the Employee shall not be entitled to receive severance or other
benefits as described in this Section 5, but may be eligible for those benefits
(if any) as may then be established under CollaGenex’ then existing severance
and benefits plans and policies at the time of such termination.

Accrued Wages and Vacation; Expenses.  Without regard to the reason for, or the
timing of, Employee’s termination of employment: (i) CollaGenex shall pay the
Employee any unpaid base salary due for periods prior to the Termination Date;
(ii) CollaGenex shall pay the Employee all of the Employee’s accrued and unused
vacation through the Termination Date; and (iii) following submission of proper
expense reports by the Employee, CollaGenex shall reimburse the Employee for
all expenses reasonably and necessarily incurred by the Employee in connection
with the business of CollaGenex prior to the Termination Date.  These payments shall be made promptly upon
termination and within the period of time mandated by law.

6.             Certain
Additional Payments by the Employer. 

(a)           If it shall be determined that any
benefit provided to the Executive or payment or distribution by or for the account
of the Employer to or for the benefit of the

 5
 

 

Executive, whether
provided, paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise (a “Payment”) would be subject to the excise tax
imposed by Section 4999 of the Code, or any interest or penalties are
incurred by the Executive with respect to such excise tax resulting from any
action or inaction by the Employer (such excise tax, together with any such
interest and penalties, collectively, the “Excise Tax”), then the Executive
shall be entitled to receive an additional payment (a “Gross-Up Payment”)
in an amount such that after payment by the Executive of the Excise Tax and all
other income, employment, excise and other taxes that are imposed on the
Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal
to the sum of (A) the Excise Tax imposed upon the Payments and
(B) the product of any deductions disallowed because of the inclusion of
the Gross-up Payment in the Executive’s adjusted gross income and the highest
applicable marginal rate of federal income taxation for the calendar year in
which the Gross-Up Payment is to be made.

(b)           Subject to the provisions of
Section 6(d), all determinations required to be made under this
Section 6, including whether and when a Gross-Up Payment is required and
the amount of such Gross-Up Payment and the assumptions to be utilized in
arriving at such determination, shall be made by the Employer’s independent,
certified public accounting firm or such other certified public accounting firm
as may be designated by the Executive and shall be reasonably acceptable to the
Employer (the “Accounting Firm”) which shall provide detailed supporting
calculations both to the Employer and the Executive within 15 business
days of the receipt of notice from the Executive that there has been a Payment,
or such earlier time as is requested by the Employer.  If the Accounting Firm is serving as
accountant or auditor for the individual, entity or group effecting a change in
the ownership or effective control (as defined for purposes of
Section 280G of the Code) of the Employer, the Executive shall appoint
another nationally recognized accounting firm which is reasonably acceptable to
the Employer to make the determinations required hereunder (which accounting
firm shall then be referred to as the Accounting Firm hereunder).  All fees and expenses of the Accounting Firm
shall be borne solely by the Employer. 
Any Gross-Up Payment, as determined pursuant to this Section 6,
shall be paid by the Employer to the Executive within five days of the receipt
of the Accounting Firm’s determination. 
Any determination by the Accounting Firm shall be binding upon the
Employer and the Executive.  As a result
of the uncertainty in the application of Section 4999 of

 6
 

 

the Code at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that additional Gross-Up Payments shall be required to be made to
compensate the Executive for amounts of Excise Tax later determined to be due,
consistent with the calculations required to be made hereunder (an “Underpayment”).  If the Employer exhausts its remedies
pursuant to Section 6(c) and the Executive is required to make a payment
of any Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment that has occurred and any such Underpayment shall be promptly paid
by the Employer to or for the benefit of the Executive.

(c)           The Executive shall notify the
Employer in writing of any claim by the Internal Revenue Service that, if
successful, would require the payment by the Employer of the Gross-Up
Payment.  Such notification shall be
given as soon as practicable but no later than 10 business days after the
Executive is informed in writing of such claim and shall apprise the Employer
of the nature of such claim and the date on which such claim is requested to be
paid.  The Executive shall not pay such
claim prior to the expiration of the 30-day period following the date on which it
gives such notice to the Employer (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due).  If the Employer notifies the Executive in
writing prior to the expiration of such period that they desire to contest such
claim, the Executive shall:

(i)            give the Employer any information
reasonably requested by the Employer relating to such claim;

(ii)           take such action in connection with
contesting such claim as the Employer shall reasonably request in writing from
time to time, including, without limitation, accepting legal representation
with respect to such claim by an attorney reasonably selected by the Employer;

(iii)          cooperate with the Employer in good
faith effectively to contest such claim; and

 7
 

 

(iv)          permit the Employer to participate in
any proceedings relating to such claim; provided, however, that the Employer
shall bear and pay directly all costs and expenses (including additional
interest and penalties incurred in connection with such contest) and shall
indemnify and hold the Executive harmless, on an after-tax basis, for any
Excise Tax or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of costs and
expenses.

7.             Successors.

(a)           Company’s
Successors.  Any successor to CollaGenex
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of
CollaGenex’ business and/or assets shall assume CollaGenex’ obligations under
this Agreement and agree expressly to perform CollaGenex’ obligations under
this Agreement in the same manner and to the same extent as CollaGenex would be
required to perform such obligations in the absence of a succession.  For all purposes under this Agreement, the
term “Company” shall include any successor to CollaGenex’ business and/or
assets which executes and delivers the assumption agreement described in this
subsection (a) or which becomes bound by the terms of this Agreement by
operation of law.

(b)           Employee’s
Successors.  Without the written
consent of CollaGenex, Employee shall not assign or transfer this Agreement or
any right or obligation under this Agreement to any other person or
entity.  Notwithstanding the foregoing,
the terms of this Agreement and all rights of Employee hereunder shall inure to
the benefit of, and be enforceable by, Employee’s personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees.

8.             Notices.

(a)           General.  Notices and all other communications
contemplated by this Agreement shall be in writing and shall be deemed to have
been duly given when they are personally delivered or when they are mailed by
U.S. registered or certified mail, return receipt requested and postage
prepaid.  In the case of the Employee,
mailed notices shall be addressed to the Employee at the home address which the
Employee most recently communicated to CollaGenex in writing.  In

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the case of CollaGenex, mailed notices shall
be addressed to its corporate headquarters, and all notices shall be directed
to the attention of its Secretary.

(b)           Notice
of Termination.  Any termination by
CollaGenex for Cause or by the Employee as a result of a voluntary resignation
or an Involuntary Termination shall be communicated by a notice of termination
to the other party to this Agreement given in accordance with this
Section.  Such notice shall (i) indicate
the specific termination provision in this Agreement relied upon, (ii) set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination under the provision so indicated, and (iii) specify the
Termination Date (which shall be not more than 30 days after the giving of such
notice).  If the Employee fails to
include in the notice any fact or circumstance which contributes to a showing
of Involuntary Termination, that failure shall not waive any right of the
Employee under this Agreement or preclude the Employee from asserting such fact
or circumstance in enforcing his or her rights under this Agreement.

9.             Miscellaneous
Provisions.

(a)           No
Duty to Mitigate.  The Employee shall
not be required to mitigate the amount of any payment contemplated by this
Agreement, nor shall any such payment be reduced by any earnings that the
Employee may receive from any other source.

(b)           Waiver.  No provision of this Agreement may be
modified, waived or discharged unless the modification, waiver or discharge is
agreed to in writing and signed by the Employee and by an authorized officer of
CollaGenex (other than the Employee).  No
waiver by either party of any breach of, or of compliance with, any condition
or provision of this Agreement by the other party shall be considered a waiver
of any other condition or provision or of the same condition or provision at
another time.

(c)           Integration.  This Agreement and any outstanding stock
option agreements and restricted stock purchase agreements referenced in this
Agreement represent the entire agreement and understanding between the parties
as to the subject matter of this Agreement and supersede all

 9
 

 

prior or contemporaneous agreements, whether
written or oral, with respect to this Agreement and any stock option agreement
or restricted stock purchase agreement.

(d)           Choice
of Law.  The validity,
interpretation, construction and performance of this Agreement shall be
governed by the internal substantive laws, but not the conflicts of law rules,
of the Commonwealth of Pennsylvania.

(e)           Litigation
Expense.  In the event Employee
commences litigation to enforce rights under this Agreement, and a final
unappealable outcome of the litigation is an award in favor of Employee, in
addition to the amount of the award, CollaGenex will reimburse Employee for the
costs and expenses of the litigation, including reasonable attorney fees.

(f)            Severability.  The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.

(g)           Employment
Taxes.  All payments made pursuant to
this Agreement shall be subject to withholding of applicable income and
employment taxes.

(h)           Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together will constitute one and the same instrument.

10.           Indemnification.

The Company will,
to the fullest extent permitted by law, indemnify and hold the Employee
harmless from any and all liability arising from the Employee’s service as an
employee, officer or director of the Company and its affiliated companies. To
the fullest extent permitted by law, the Company will advance legal fees and
expenses to the Employee for counsel selected by the Employee in connection
with any litigation or proceeding related to the Employee’s service as an
employee, officer or director of the Company and its affiliates. The terms of
this indemnification provision shall survive the expiration of this Agreement.

 10
 

 

IN WITNESS
WHEREOF, each of the parties has executed this Agreement, in the case of
CollaGenex by its duly authorized officer, as of the day and year first written
above.

	
  COMPANY:

  	
   

  	
  COLLAGENEX PHARMACEUTICALS,

  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EMPLOYEE:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Printed Name

  
						

 

 11Exhibit 10.1

 

AMENDED AND RESTATED DECLARATION

 

OF TRUST

 

MAINSOURCE STATUTORY
TRUST IV

 

Dated as of October
13, 2006

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  
	
  ARTICLE I

  INTERPRETATION AND DEFINITIONS

  
	
  SECTION 1.1.

  	
   

  	
  Definitions

  	
   

  	
  1

  

 

ARTICLE II

ORGANIZATION

 

	
  SECTION 2.1.

  	
   

  	
  Name

  	
   

  	
  9

  
	
  SECTION 2.2.

  	
   

  	
  Office

  	
   

  	
  9

  
	
  SECTION 2.3.

  	
   

  	
  Purpose

  	
   

  	
  9

  
	
  SECTION 2.4.

  	
   

  	
  Authority

  	
   

  	
  9

  
	
  SECTION 2.5.

  	
   

  	
  Title to
  Property of the Trust

  	
   

  	
  10

  
	
  SECTION 2.6.

  	
   

  	
  Powers and
  Duties of the Trustees and the Administrators

  	
   

  	
  10

  
	
  SECTION 2.7.

  	
   

  	
  Prohibition
  of Actions by the Trust and the Trustees

  	
   

  	
  15

  
	
  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

  	
   

  	
  19

  
	
  SECTION
  2.11.

  	
   

  	
  Delaware
  Trustee

  	
   

  	
  21

  
	
  SECTION
  2.12.

  	
   

  	
  Execution of
  Documents

  	
   

  	
  21

  
	
  SECTION
  2.13.

  	
   

  	
  Not
  Responsible for Recitals or Issuance of Securities

  	
   

  	
  21

  
	
  SECTION
  2.14.

  	
   

  	
  Duration of
  Trust

  	
   

  	
  22

  
	
  SECTION
  2.15.

  	
   

  	
  Mergers

  	
   

  	
  22

  

 

ARTICLE III

SPONSOR

 

	
  SECTION 3.1.

  	
   

  	
  Sponsor’s
  Purchase of Common Securities

  	
   

  	
  24

  
	
  SECTION 3.2.

  	
   

  	
  Responsibilities
  of the Sponsor

  	
   

  	
  24

  

 

ARTICLE IV

TRUSTEES AND ADMINISTRATORS

 

	
  SECTION 4.1.

  	
   

  	
  Number of
  Trustees

  	
   

  	
  24

  
	
  SECTION 4.2.

  	
   

  	
  Delaware
  Trustee

  	
   

  	
  24

  
	
  SECTION 4.3.

  	
   

  	
  Institutional
  Trustee; Eligibility

  	
   

  	
  25

  
	
  SECTION 4.4.

  	
   

  	
  Certain
  Qualifications of the Delaware Trustee Generally

  	
   

  	
  25

  
	
  SECTION 4.5.

  	
   

  	
  Administrators

  	
   

  	
  25

  
	
  SECTION 4.6.

  	
   

  	
  Initial
  Delaware Trustee

  	
   

  	
  26

  

 

 

i

 

	
  SECTION 4.7.

  	
   

  	
  Appointment,
  Removal and Resignation of the Trustees and the Administrators

  	
   

  	
  26

  
	
  SECTION 4.8.

  	
   

  	
  Vacancies
  Among Trustees

  	
   

  	
  28

  
	
  SECTION 4.9.

  	
   

  	
  Effect of
  Vacancies

  	
   

  	
  28

  
	
  SECTION
  4.10.

  	
   

  	
  Meetings of
  the Trustees and the Administrators

  	
   

  	
  28

  
	
  SECTION
  4.11.

  	
   

  	
  Delegation
  of Power

  	
   

  	
  28

  
	
  SECTION
  4.12.

  	
   

  	
  Merger,
  Conversion, Consolidation or Succession to Business

  	
   

  	
  29

  

 

ARTICLE V

DISTRIBUTIONS

 

	
  SECTION 5.1.

  	
   

  	
  Distributions

  	
   

  	
  29

  

 

ARTICLE VI

ISSUANCE OF SECURITIES

 

	
  SECTION 6.1.

  	
   

  	
  General
  Provisions Regarding Securities

  	
   

  	
  29

  
	
  SECTION 6.2.

  	
   

  	
  Paying
  Agent, Transfer Agent, Calculation Agent and Registrar

  	
   

  	
  31

  
	
  SECTION 6.3.

  	
   

  	
  Form and
  Dating

  	
   

  	
  31

  
	
  SECTION 6.4.

  	
   

  	
  Book-Entry
  Capital Securities

  	
   

  	
  32

  
	
  SECTION 6.5.

  	
   

  	
  Mutilated,
  Destroyed, Lost or Stolen Certificates

  	
   

  	
  33

  
	
  SECTION 6.6.

  	
   

  	
  Temporary
  Securities

  	
   

  	
  34

  
	
  SECTION 6.7.

  	
   

  	
  Cancellation

  	
   

  	
  34

  
	
  SECTION 6.8.

  	
   

  	
  Rights of
  Holders; Waivers of Past Defaults

  	
   

  	
  34

  

 

ARTICLE VII

DISSOLUTION AND TERMINATION OF TRUST

 

	
  SECTION 7.1.

  	
   

  	
  Dissolution
  and Termination of Trust

  	
   

  	
  36

  

 

ARTICLE VIII

TRANSFER OF INTERESTS

 

	
  SECTION 8.1.

  	
   

  	
  General

  	
   

  	
  37

  
	
  SECTION 8.2.

  	
   

  	
  Transfer
  Procedures and Restrictions

  	
   

  	
  38

  
	
  SECTION 8.3.

  	
   

  	
  Deemed
  Security Holders

  	
   

  	
  41

  

 

ARTICLE IX

LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS

 

	
  SECTION 9.1.

  	
   

  	
  Liability

  	
   

  	
  42

  
	
  SECTION 9.2.

  	
   

  	
  Exculpation

  	
   

  	
  42

  
	
  SECTION 9.3.

  	
   

  	
  Fiduciary
  Duty

  	
   

  	
  42

  

 

ii

 

	
  SECTION 9.4.

  	
   

  	
  Indemnification

  	
   

  	
  43

  
	
  SECTION 9.5.

  	
   

  	
  Outside
  Businesses

  	
   

  	
  46

  
	
  SECTION 9.6.

  	
   

  	
  Compensation;
  Fee

  	
   

  	
  46

  

 

ARTICLE X

ACCOUNTING

 

	
  SECTION
  10.1.

  	
   

  	
  Fiscal Year

  	
   

  	
  47

  
	
  SECTION
  10.2.

  	
   

  	
  Certain
  Accounting Matters

  	
   

  	
  47

  
	
  SECTION
  10.3.

  	
   

  	
  Banking

  	
   

  	
  48

  
	
  SECTION
  10.4.

  	
   

  	
  Withholding

  	
   

  	
  48

  

 

ARTICLE XI

AMENDMENTS AND MEETINGS

 

	
  SECTION
  11.1.

  	
   

  	
  Amendments

  	
   

  	
  48

  
	
  SECTION
  11.2.

  	
   

  	
  Meetings of
  the Holders of the Securities; Action by Written Consent

  	
   

  	
  50

  

 

ARTICLE XII

REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE

 

	
  SECTION
  12.1.

  	
   

  	
  Representations
  and Warranties of Institutional Trustee

  	
   

  	
  52

  
	
  SECTION
  12.2.

  	
   

  	
  Representations
  and Warranties of Delaware Trustee

  	
   

  	
  52

  

 

ARTICLE XIII

MISCELLANEOUS

 

	
  SECTION
  13.1.

  	
   

  	
  Notices

  	
   

  	
  53

  
	
  SECTION
  13.2.

  	
   

  	
  Governing
  Law

  	
   

  	
  55

  
	
  SECTION
  13.3.

  	
   

  	
  Submission
  to Jurisdiction

  	
   

  	
  55

  
	
  SECTION
  13.4.

  	
   

  	
  Intention of
  the Parties

  	
   

  	
  55

  
	
  SECTION
  13.5.

  	
   

  	
  Headings

  	
   

  	
  55

  
	
  SECTION
  13.6.

  	
   

  	
  Successors
  and Assigns

  	
   

  	
  55

  
	
  SECTION
  13.7.

  	
   

  	
  Partial
  Enforceability

  	
   

  	
  56

  
	
  SECTION
  13.8.

  	
   

  	
  Counterparts

  	
   

  	
  56

  

 

iii

 

ANNEXES AND EXHIBITS

 

	
  ANNEX I

  	
   

  	
  Terms of Capital Securities and Common Securities

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A-1

  	
   

  	
  Form of Capital Security Certificate

  
	
  EXHIBIT A-2

  	
   

  	
  Form of Common Security Certificate

  

 

iv

 

AMENDED AND RESTATED DECLARATION OF TRUST

 

OF

 

MAINSOURCE STATUTORY
TRUST IV

 

October 13, 2006

 

AMENDED AND
RESTATED DECLARATION OF TRUST (this “Declaration”), dated and effective as of October 13, 2006, by the Trustees (as defined
herein), the Administrators (as defined herein), the Sponsor (as defined
herein) and the holders from time to time of undivided beneficial interests in
the assets of the Trust (as defined herein) to be issued pursuant to this
Declaration.

 

WHEREAS,
certain of the Trustees, the Administrators and the Sponsor established MainSource Statutory Trust IV (the “Trust”), a
statutory trust under the Statutory Trust Act (as defined herein), pursuant to
a Declaration of Trust, dated as of October 11,
2006 (the “Original Declaration”), and a Certificate of Trust filed with
the Secretary of State of the State of Delaware on October 11, 2006, 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, all
of the Trustees, the Administrators and the Sponsor, by this Declaration, amend
and restate each and every term and provision of the Original Declaration.

 

NOW, THEREFORE,
it being the intention of the parties hereto to continue the Trust as a
statutory trust under the Statutory Trust Act and that this Declaration
constitutes the governing instrument of such statutory trust, and that all
assets contributed to the Trust will be held in trust for the benefit of the
holders, from time to time, of the securities 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;

 

 

(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 James L. Saner, Sr. and James M. Anderson, 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

 

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.

 

“Book-Entry
Capital Security” means a Capital Security, the ownership and transfers of
which shall be made through book entries by a Depositary.

 

“Business Day”
means any day other than Saturday, Sunday or any other day on which banking
institutions in Wilmington, Delaware or New York City or 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
Security Certificate” means a definitive Certificate registered in the name of
the Holder representing Capital Securities, which shall be substantially in the
form attached hereto as Exhibit A 1.

 

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

 

“Certificate”
means any certificate evidencing Securities.

 

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

 

“Closing Date”
has the meaning set forth in the Purchase Agreement.

 

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

 

“Commission”
means the United States Securities and Exchange Commission.

 

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

 

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

 

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

 

“Corporate
Trust Office” means the office of the Institutional Trustee at which 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 919 Market Street Suite 700 Wilmington, DE 19801, Attention:
Corporate Trust Division.

 

3

 

“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 MainSource Financial Group, Inc.,
a financial holding company incorporated in Indiana,
in its capacity as issuer of the Debentures under the Indenture.

 

“Debenture
Trustee” means Wells Fargo Bank, National Association, a national banking
association with its principal place of business in the State of Delaware, 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, 2036 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.

 

“Delaware
Trustee” has the meaning set forth in Section 4.2.

 

“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.

 

“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

 

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

 

“Fiscal Year”
has the meaning set forth in Section 10.1.

 

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

 

“Guarantee”
means the Guarantee Agreement, dated as of October
13, 2006, of the Sponsor 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 October 13,
2006, among the Debenture Issuer and the Debenture Trustee, and any
indenture supplemental thereto pursuant to which the Debentures are to be
issued.

 

“Indenture
Event of Default” means an “Event of Default” as defined in the Indenture.

 

“Initial
Purchaser” means the initial purchaser of the Capital Securities.

 

“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.

 

5

 

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

 

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

 

“LIBOR” means
the London Interbank Offered Rate for 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:

 

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

 

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

 

(e)           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

 

(f)            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.

 

6

 

“Paying Agent”
has the meaning set forth in Section 6.2.

 

“Payment
Amount” has the meaning set forth in Section 5.1.

 

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

 

“PORTAL” has
the meaning set forth in Section 2.6(a)(í).

 

“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.

 

“Purchase
Agreement” means the Purchase Agreement relating to the offering and sale of
Capital Securities.

 

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

 

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

 

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

 

“Registrar”
has the meaning set forth in Section 6.2.

 

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

 

“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.

 

7

 

“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.

 

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

 

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

 

“Sponsor”
means MainSource Financial Group, Inc., a
financial holding company that is a U.S. Person incorporated in Indiana, 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 38 of Title 12 of the Delaware Code, 12 Del. Code §
3801 et seq., as it may be amended from time to time, or any successor
legislation.

 

“Successor
Delaware Trustee” has the meaning set forth in Section 4.7(e).

 

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

 

“Successor
Institutional Trustee” has the meaning set forth in Section 4.7(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.

 

“Transfer
Notice” has the meaning set forth in Section 8.2(e).

 

“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 

 

8

 

accordance with the provisions hereof, and references herein to a
Trustee or the Trustees shall refer to such Person or Persons solely in their
capacity as trustees hereunder.

 

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

 

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

 

ARTICLE II

ORGANIZATION

 

SECTION 2.1. Name. The
Trust is named “MainSource Statutory Trust IV,”
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 201
N. Broadway, Greensburg, Indiana 47240.
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.

 

9

 

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

 

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

 

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

 

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

 

(A)          the issuance and sale of the Securities;

 

(B)           to 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 

 

10

 

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;

 

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

 

(I)            execution and delivery of closing
certificates pursuant to the Purchase 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 Purchase Agreement 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;

 

11

 

(Q)          to give the certificate required by §
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 jurisdiction (other than the State of Delaware) in which such
existence is necessary to protect the limited liability of the Holders of the
Capital Securities or to enable the Trust to effect the purposes for which the
Trust was created.

 

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

 

(A)          the establishment of the Property Account;

 

(B)           the receipt of the Debentures;

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

12

 

conserve the Trust Property for the benefit of the Holders (without
consideration of the effect of any such action on any particular Holder);

 

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

 

(K)          to undertake any actions set forth in §
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)(F) and (G) 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 

 

13

 

determination of any and all such acts, other than actions which must
be taken by or on behalf of the Trust, and the advisement of and direction to
the Trustees of actions they must take on behalf of the Trust, and the
preparation for execution and filing of any documents to be executed and filed
by the Trust or on behalf of the Trust, as the Sponsor deems necessary or
advisable in order to comply with the applicable laws of any such 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.

 

(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), (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.

 

14

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

SECTION 2.8. Powers and
Duties of the Institutional Trustee.

 

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

 

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

 

(c)           The Institutional
Trustee shall:

 

15

 

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

 

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

 

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

 

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

 

(e)           The Institutional
Trustee may bring or defend, pay, collect, compromise, arbitrate, resort to
legal action with respect to, or otherwise adjust claims or demands of or
against, the Trust (a “Legal Action”) which 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 

 

16

 

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
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 6.8), 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 

 

17

 

Administrator’s good faith reliance on the
provisions of this Declaration. The provisions of this Declaration, to the
extent that they restrict the duties and liabilities of the Administrators or
the Trustees otherwise existing at law or in equity, are agreed by the Sponsor
and the Holders to replace such other duties and liabilities of the
Administrators or the Trustees.

 

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

 

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

 

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

 

18

 

Institutional Trustee pursuant to Section 2.8(c)(í) and except to the
extent otherwise required by law; and

 

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

 

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

 

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

 

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

 

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

 

(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 

 

19

 

omitted by it hereunder in good faith and in
reliance thereon and in accordance with such advice; the Institutional Trustee
shall have the right at any time to seek instructions concerning the
administration of this Declaration from any court of competent jurisdiction;

 

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

 

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

 

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

 

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

 

20

 

(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) or 5.01 (b) 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

 

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

 

SECTION 2.11. Delaware
Trustee. Notwithstanding any other provision of this Declaration other than
Section 4.2, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities of
any of the Trustees or the Administrators described in this Declaration (except
as may be required under the Statutory Trust Act). Except as set forth in
Section 4.2, the Delaware Trustee shall be a Trustee for the sole and limited
purpose of fulfilling the requirements of § 3807 of the Statutory Trust Act.

 

SECTION 2.12. Execution of
Documents. Unless otherwise determined in writing by the Institutional
Trustee, and except as otherwise required by the Statutory Trust Act, the
Institutional Trustee, or any one or more of the Administrators, as the case
may be, is authorized to execute and deliver on behalf of the Trust any
documents, agreements, instruments or certificates that the Trustees or the
Administrators, as the case may be, have the power and authority to execute
pursuant to Section 2.6.

 

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

 

21

 

SECTION 2.14. Duration of
Trust. The Trust, unless dissolved pursuant to the provisions of Article
VII hereof, shall have existence for thirty-five (35) years from the Closing
Date.

 

SECTION 2.15. Mergers.

 

(a)           The Trust may not
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets substantially as an entirety to any
corporation or other Person, except as described in this Section 2.15 and
except with respect to the distribution of Debentures to Holders of Securities
pursuant to Section 7.1(a)(iv) of the Declaration or Section 3 of Annex I.

 

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

 

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

 

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

 

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

 

(ii)           the Sponsor expressly appoints, as the
holder of the Common Securities, 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 rating, if any,
on the Capital Securities (including any Successor Securities) to be downgraded
or withdrawn by any nationally recognized statistical rating organization, if
the Capital Securities are then rated;

 

(v)           such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and 

 

22

 

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;

 

(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.

 

23

 

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 Purchase Agreement
and other related agreements providing for the sale of the Capital Securities.

 

ARTICLE IV

TRUSTEES AND ADMINISTRATORS

 

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

 

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

 

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

 

SECTION 4.2. Delaware
Trustee. If required by the Statutory Trust Act, one Trustee (the “Delaware
Trustee”) shall be:

 

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

 

24

 

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

 

SECTION 4.3. Institutional
Trustee; Eligibility.

 

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

 

(i)            not be an Affiliate of the Sponsor;

 

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

 

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

 

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

 

(c)           If the Institutional
Trustee has or shall acquire any “conflicting interest” within the meaning of §
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 Wells Fargo Bank, National Association.

 

SECTION 4.4. Certain
Qualifications of the Delaware Trustee Generally. The Delaware Trustee
shall be a U.S. Person and either a natural person who is at least 21 years of
age or a legal entity that shall act through one or more Authorized Officers.

 

SECTION 4.5. Administrators.
Each Administrator shall be a U.S. Person.

 

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 

 

25

 

by, and any power of the Administrators may be exercised by, or with
the consent of, any one such Administrator acting alone.

 

SECTION 4.6. Initial
Delaware Trustee. The initial Delaware Trustee shall be Wells Fargo
Delaware Trust Company.

 

SECTION 4.7. Appointment,
Removal and Resignation of the Trustees and the Administrators.

 

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

 

(b)           Subject to Section
4.7(a), a Relevant Trustee may resign at any time by giving written notice
thereof to the Holders of the Securities and by appointing a successor Relevant
Trustee, except that the Delaware Trustee’s successor shall be appointed by
Holders of a Majority in liquidation amount of the Common Securities. 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
Relevant Trustee required by this Section 4.7 shall not have been delivered to
the Relevant Trustee within 60 days after the giving of such notice of resignation
or delivery of the instrument of removal, the Relevant Trustee may petition, at
the expense of the Trust, any federal, state or District of Columbia court of
competent jurisdiction for the appointment of a successor Relevant Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Relevant Trustee. The Institutional Trustee shall have no
liability for the selection of such successor pursuant to this Section 4.7.

 

(c)           Unless an Event of
Default shall have occurred and be continuing, any Trustee may be removed at
any time by an act of the Holders of a Majority in liquidation amount of the
Common Securities. If any Trustee shall be so removed, the Holders of the
Common Securities, by act of the Holders of a Majority in liquidation amount of
the Common Securities delivered to the Relevant Trustee, shall promptly appoint
a successor Relevant Trustee, and such successor Trustee shall comply with the
applicable requirements of this Section 4.7. If an Event of Default shall have
occurred and be continuing, the Institutional Trustee or the Delaware Trustee,
or both of them, may be removed by the act of the Holders of a Majority in
liquidation amount of the Capital Securities, delivered to the Relevant Trustee
(in its individual capacity and on behalf of the Trust). If any Trustee shall
be so removed, the Holders of Capital Securities, by act of the Holders of a
Majority in liquidation amount of the Capital Securities then outstanding
delivered to the Relevant Trustee, shall promptly appoint a successor Relevant
Trustee or Trustees, and such successor Trustee shall comply with the
applicable requirements of this Section 4.7. If no successor Relevant Trustee
shall have been so appointed by the Holders of a Majority in liquidation amount
of the Capital Securities and accepted appointment in the manner required by
this Section 4.7 within 30 days after delivery of an instrument of removal, the

 

26

 

Relevant Trustee or any Holder who has been a
Holder of the Securities for at least six months may, on behalf of himself and
all others similarly situated, petition any federal, state or District of
Columbia court of competent jurisdiction for the appointment of a successor
Relevant Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper, appoint a successor Relevant Trustee or Trustees.

 

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

 

(e)           Notwithstanding the
foregoing or any other provision of this Declaration, in the event a Delaware
Trustee who is a natural person dies or is adjudged by a court to have become
incompetent or incapacitated, the vacancy created by such death, incompetence
or incapacity may be filled by the Institutional Trustee (provided the
Institutional Trustee satisfies the requirements of a Delaware Trustee as set
forth in Section 4.2) following the procedures in this Section 4.7 (with the
successor being a Person who satisfies the eligibility requirement for a
Delaware Trustee set forth in this Declaration) (the “Successor Delaware
Trustee”).

 

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

 

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

 

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

 

27

 

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

 

SECTION 4.8. Vacancies Among
Trustees. If a Trustee ceases to hold office for any reason and the number
of Trustees is not reduced pursuant to Section 4.1, or if the number of
Trustees is increased pursuant to Section 4.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Trustees or, if
there are more than two, a majority of the Trustees shall be conclusive evidence
of the existence of such vacancy. The vacancy shall be filled with a Trustee
appointed in accordance with Section 4.7.

 

SECTION 4.9. Effect of
Vacancies. The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to dissolve, terminate or annul the Trust or
terminate this Declaration. Whenever a vacancy in the number of Trustees shall
occur, until such vacancy is filled by the appointment of a Trustee in
accordance with Section 4.7, the Institutional Trustee shall have all the
powers granted to the Trustees and shall discharge all the duties imposed upon
the Trustees by this Declaration.

 

SECTION 4.10. 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 4.11. Delegation of
Power.

 

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

 

28

 

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

 

ARTICLE V

DISTRIBUTIONS

 

SECTION 5.1. Distributions.
Holders shall receive Distributions in accordance with the applicable terms of
the relevant Holder’s Securities. Distributions shall be made on the Capital
Securities and the Common Securities in accordance with the preferences set
forth in their respective terms. If and to the extent that the Debenture Issuer
makes a payment of interest (including any Additional 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.

 

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 

 

29

 

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 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
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.

 

30

 

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

 

(a)           The Trust shall
maintain in Wilmington, Delaware, an office or agency where the Securities may
be presented for payment (the “Paying Agent”), and an office or agency where
Securities may be presented for registration of transfer or exchange (the “Transfer
Agent”). The Trust shall keep or cause to be kept at such office or agency a
register for the purpose of registering Securities and transfers and exchanges
of Securities, such register to be held by a registrar (the “Registrar”). The
Administrators may appoint the Paying Agent, the Registrar and the Transfer
Agent, and may appoint one or more additional Paying Agents, one or more
co-Registrars, or one or more co-Transfer Agents in such other locations as it
shall determine. The term “Paying Agent” includes any additional Paying Agent,
the term “Registrar” includes any additional Registrar or co-Registrar and the
term “Transfer Agent” includes any additional Transfer Agent or co-Transfer
Agent. The Administrators may change any Paying Agent, Transfer Agent or
Registrar at any time without prior notice to any Holder. The Administrators
shall notify the Institutional Trustee of the name and address of any Paying
Agent, Transfer Agent and Registrar not a party to this Declaration. The
Administrators hereby initially appoint the Institutional Trustee to act as
Paying Agent, Transfer Agent and Registrar for the Capital Securities and the
Common Securities at its Corporate Trust Office. The Institutional Trustee or
any of its Affiliates in the United States may act as Paying Agent, Transfer
Agent or Registrar.

 

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

 

SECTION 6.3. Form and Dating.

 

(a)           The Capital Securities
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 Delaware Trustee, the Administrators and the Sponsor, by their
execution and delivery of this Declaration, expressly agree to such terms and
provisions and to be bound thereby. Capital Securities will be issued only in
blocks having a stated liquidation amount of not less than $100,000 and
multiples of $1,000 in excess thereof.

 

(b)           The Capital Securities
sold by the Trust to the Initial Purchaser pursuant to the Purchase Agreement
shall be issued in the form of a Global Capital Security, registered in the
name of the Depositary, without coupons and with the Restricted Securities
Legend.

 

31

 

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 to properly 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 and the Institutional Trustee of the occurrence of such event
and of the availability of Definitive Capital Securities Certificates to Owners
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 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.

 

32

 

(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 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

 

33

 

(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
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 6.5, 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 Institutional
Trustee for cancellation. The Registrar shall forward to the Institutional
Trustee any Securities surrendered to it for registration of transfer,
redemption or payment. The Institutional Trustee shall promptly cancel all
Securities surrendered for registration of transfer, payment, replacement or
cancellation and shall dispose of such canceled Securities 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 2.6(g), 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
for which acceleration is permitted under Section 5.01, 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 

 

34

 

then outstanding shall have the right to make
such declaration by a notice in writing to the Institutional Trustee, the
Sponsor and the Debenture Trustee.

 

(c)           At any time after a declaration
of acceleration of maturity of the Debentures has been made and before a
judgment or decree for payment of the money due has been obtained by the
Debenture Trustee as provided in the Indenture, if the Institutional Trustee,
subject to the provisions hereof, fails to annul any such 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 of
or premium, if any, 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 

 

35

 

or not such Holders remain Holders after such
record date; provided, that, unless such declaration of acceleration, or
rescission and annulment, as the case may be, shall have become effective by
virtue of the requisite percentage having joined in such notice prior to the
day that is 90 days after such record date, such notice of declaration of
acceleration, or rescission and annulment, as the case may be, shall automatically
and without further action by any Holder be canceled and of no further effect.
Nothing in this paragraph shall prevent a Holder, or a proxy of a Holder, from
giving, after expiration of such 90-day period, a new written notice of
declaration of acceleration, or rescission and annulment thereof, as the case
may be, that is identical to a written notice that has been canceled pursuant
to the proviso to the preceding sentence, in which event a new record date
shall be established pursuant to the provisions of this Section 6.8.

 

(f)            Except as otherwise
provided in this Section 6.8, 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, 2041, the expiration of the term
of the Trust;

 

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

 

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

 

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

 

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

 

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

 

36

 

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

 

(b)           As soon as is
practicable after the occurrence of an event referred to in Section 7.1(a), and
after satisfaction of liabilities to creditors of the Trust as required by
applicable law, including Section 3808 of the Statutory Trust Act, and subject
to the terms set forth in Annex I, the Institutional Trustee, when notified in
writing of the completion of the winding up of the Trust in accordance with the
Statutory Trust Act, 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 Delaware.

 

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

 

ARTICLE VIII

TRANSFER OF INTERESTS

 

SECTION 8.1. General.

 

(a)           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 

 

37

 

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
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. 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
Institutional Trustee, as may be reasonably required by the Trust, that neither
the legend nor the restrictions on transfer set forth therein are required to
ensure that transfers thereof comply with the provisions of the Securities Act
or that such Securities are not “restricted” within the meaning of Rule 144
under the Securities Act. Upon provision of such satisfactory evidence, the
Institutional Trustee, at the written direction of the Trust, shall
authenticate and deliver Capital Securities that do not bear the Restricted
Securities Legend (other than the legend contemplated by Section 8.2(c)).

 

(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 Trust 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 CAPITAL 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 

 

38

 

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 MAINSOURCE STATUTORY TRUST IV 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 AN “ACCREDITED INVESTOR,” FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE DEBENTURE ISSUER’S AND THE TRUST’S RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C) OR (D) TO REQUIRE THE DELIVERY
OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY
TO EACH OF THEM IN ACCORDANCE WITH THE 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 

 

39

 

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 OR AN APPLICABLE
EXEMPTION THEREFROM.

 

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

 

IN CONNECTION
WITH ANY TRANSFER, THE HOLDER 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 

 

40

 

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

 

(d)           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”) (such Transfer Notice shall be required if, and
only if, the Capital Securities are not listed with the Depository Trust
Company) 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.

 

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.

 

41

 

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 § 3803(a) of the Statutory Trust
Act, the Holders of the Securities shall be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware, except as
otherwise specifically set forth herein.

 

SECTION 9.2. Exculpation.

 

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

 

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 

 

42

 

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

 

(ii)           The Sponsor shall indemnify, to the fullest
extent permitted by law, any Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that such Person is or was an Indemnified Person against
expenses (including attorneys’ fees and expenses) actually and reasonably
incurred by such Person in connection with the defense or settlement of such action
or suit if such Person acted in good faith and in a manner such Person
reasonably believed to be in or not opposed to the best interests of the Trust
and except that no such indemnification shall be made in respect of any claim,
issue or matter as to which such Indemnified Person shall have been adjudged to
be liable to the Trust unless and only to the extent that the Court of Chancery
of Delaware or the court in which such action or suit was 

 

43

 

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.

 

(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 

 

44

 

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.

 

(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 

 

45

 

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

 

SECTION 9.6. Compensation;
Fee.

 

(a)           Subject to the
provisions set forth in the Fee Agreement of even date herewith, by and among
the Institutional Trustee, the Trust and the Initial Purchaser (the “Fee
Agreement”), 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

 

46

 

(ii)           except as otherwise expressly provided herein
or in the Fee Agreement, 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 § 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 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 § 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 § 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.

 

47

 

(e)           The Administrators will
cause the Sponsor’s reports on Form FR Y-9C
to be delivered to the Holders promptly following their filing with the Board
of Governors of the Federal Reserve System (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 § 301.7701-7, in the name and for
the sole benefit of the Trust; provided, however, that all
payments of funds in respect of the Debentures held by the Institutional
Trustee shall be made directly to the Property Account and no other funds of
the Trust shall be deposited in the Property Account. The sole signatories for
such accounts (including the Property Account) shall be designated by the
Institutional Trustee.

 

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

 

ARTICLE XI

AMENDMENTS AND MEETINGS

 

SECTION 11.1. Amendments.

 

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

 

(i)            the Institutional Trustee,

 

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

 

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

 

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

 

48

 

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

 

(i)            unless the Institutional Trustee shall have
first received

 

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

 

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

 

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

 

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

 

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

 

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

 

(D)          cause the Debenture Issuer to be unable to
treat an amount equal to the Liquidation Amount of the Capital Securities as
“Tier 1 Capital” 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.

 

49

 

(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)(ii), 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 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 

 

50

 

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 15
days and not more than 60 days before the date of such meeting. Whenever a
vote, consent or approval of the Holders of the Securities is permitted or
required under this Declaration or the rules of any stock exchange on which the
Capital Securities are listed or admitted for trading, if any, such vote,
consent or approval may be given at a meeting of the Holders of the Securities.
Any action that may be taken at a meeting of the Holders of the Securities may
be taken without a meeting if a consent in writing setting forth the action so
taken is signed by the Holders of the Securities owning not less than the
minimum amount of Securities that would be necessary to authorize or take such
action at a meeting at which all Holders of the Securities having a right to
vote thereon were present and voting. Prompt notice of the taking of action
without a meeting shall be given to the Holders of the Securities entitled to
vote who have not consented in writing. The Administrators may specify that any
written ballot submitted to the Holders of the Securities for the purpose of
taking any action without a meeting shall be returned to the Trust within the
time specified by the Administrators;

 

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

 

(iii)          unless the 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; 

 

51

 

provided, however,
that each meeting shall be conducted in the United States (as that term is
defined in Treasury Regulations § 301.7701-7).

 

ARTICLE XII

REPRESENTATIONS OF INSTITUTIONAL TRUSTEE

AND DELAWARE TRUSTEE

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

52

 

(a)           if it is not a natural
person, the Delaware Trustee has its principal place of business in the State
of Delaware;

 

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

 

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

 

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

 

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

 

(f)            if the Delaware Trustee
is a natural person, it is a resident of the State of Delaware.

 

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):

 

53

 

MainSource
Statutory Trust IV

c/o MainSource Financial Group, Inc.

201
N. Broadway

Greensburg,
Indiana 47240

Attention: Jamie Anderson

Telecopy: (812) 663-4812

Telephone: (812) 663-0179

 

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

 

Wells Fargo
Delaware Trust Company

919 Market
Street Suite 700

Wilmington, DE
19801

Attention:
Corporate Trust Division

Telecopy:
302-575-2006

Telephone:
302-575-2005

 

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

 

Wells Fargo
Bank, National Association

919 Market
Street Suite 700

Wilmington, DE
19801

Attention:
Corporate Trust Division

Telecopy:
302-575-2006

Telephone:
302-575-2005

 

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

 

MainSource
Financial Group, Inc.

201
N. Broadway

Greensburg,
Indiana 47240

Attention: Jamie Anderson

Telecopy: (812) 663-4812

Telephone: (812) 663-0179

 

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

 

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

 

54

 

SECTION 13.2. Governing Law.
This Declaration and the rights and obligations of the parties hereunder shall
be governed by and interpreted in accordance with the law of the State of
Delaware and all rights, obligations and remedies shall be governed by such
laws without regard to the principles of conflict of laws of the State of
Delaware or any other jurisdiction that would call for the application of the
law of any jurisdiction other than the State of Delaware.

 

SECTION 13.3. Submission to
Jurisdiction.

 

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

 

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

 

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

 

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

 

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

 

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

 

55

 

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.

 

56

 

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

 

	
   

  	
  WELLS FARGO
  DELAWARE TRUST

  
	
   

  	
  COMPANY, as Delaware Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO
  BANK, NATIONAL

  
	
   

  	
  ASSOCIATION, as Institutional Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  MAINSOURCE FINANCIAL GROUP, INC.

  
	
   

  	
  as Sponsor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MAINSOURCE
  STATUTORY TRUST IV

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  James L. Saner, Sr.

  
	
   

  	
   

  	
  Administrator

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: James
  M. Anderson

  
	
   

  	
   

  	
  Administrator

  
					

 

57

 

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 October 13, 2006 (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. 11,000 Capital Securities of MainSource Statutory Trust IV (the “Trust”),
with an aggregate stated liquidation amount with respect to the assets of the
Trust of Eleven Million Dollars ($11,000,000) 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 “Capital
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. 341 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 Forty One Thousand
Dollars ($341,000) 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 1.63%
(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

 

Institutional Trustee and to the extent the
Institutional Trustee has funds legally available in the Property Account therefor.
The amount of Distributions payable for any Distribution Payment Period will be
computed for any full quarterly Distribution Payment Period 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 immediately succeeding the
commencement of such Distribution Payment Period (or, with respect to the first
Distribution Payment Period, on October 11, 2006),
(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 Wilmington, Delaware are authorized or obligated by law or
executive order to be closed. If such rate is superseded on Telerate Page 3750
by a corrected rate before 12:00 noon (London time) on 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 

 

A-I-2

 

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 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)           On each 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. 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.

 

(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 December 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), (f) or (g) 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 

 

A-I-3

 

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 and provided,
further, that, during any such Extension Period, the Debenture Issuer
may not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, any of the
Debenture Issuer’s capital stock or (ii) make any payment of principal 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, or, if such date is not a Distribution Payment Date, on the
immediately following Distribution Payment Date, to Holders of the Securities
as they appear on the books and records of the Trust on the record date
immediately preceding such date. Distributions on the Securities must be paid
on the dates payable (after giving effect to any Extension Period) to the
extent that the Trust has funds 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 

 

A-I-4

 

from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.

 

(f)            Distributions on the
Securities will be payable to the Holders thereof as they appear on the books
and records of the Registrar on the relevant record dates. The relevant record
dates shall be selected by the Administrators, which 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, Redemption Date (to the extent redeemed) or 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,
Redemption Date or 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
interest shall accrue (except that, if such Business Day falls in the next
calendar year, such payment will be made on the immediately preceding 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 in accordance with Section 3808(e) of the
Statutory Trust Act, shall be distributed on a Pro Rata basis to the Holders of
the Securities in exchange for such Securities.

 

The Sponsor,
as the Holder of all of the Common Securities, has the right at any time to
dissolve the Trust (including without limitation upon the occurrence of a Tax
Event, an Investment Company Event or a Capital Treatment Event), subject to
the receipt by the 

 

A-I-5

 

Debenture Issuer of prior approval from any regulatory authority having
jurisdiction over the 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, an opinion of
nationally recognized tax counsel that Holders will not recognize any gain or
loss for United States federal income tax purposes as a result of the
distribution of Debentures 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, 2041, 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 Delaware.

 

If a
Liquidation of the Trust occurs as described in clause (i), (ii), (iii) or (v)
in the immediately preceding paragraph, the Trust shall be liquidated by the
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.

 

A-I-6

 

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

 

After the date
for any distribution of the Debentures upon dissolution of the Trust, (i) the
Securities of the Trust will be deemed to be no longer outstanding, (ii) any
certificates representing the Capital Securities will be deemed to represent
undivided beneficial interests in such of the Debentures as have an aggregate
principal amount equal to the aggregate stated liquidation amount of, with an
interest rate identical to the distribution rate of, and bearing accrued and
unpaid interest equal to accrued and unpaid distributions on, the Securities
until such certificates are presented to the Debenture Issuer or its agent for
transfer or reissuance (and until such certificates are so surrendered, no
payments of interest or principal shall be made to Holders of Securities in
respect of any payments due and payable under the Debentures) and (iii) all
rights of Holders of Securities under the Capital Securities or the Common
Securities, as applicable, shall cease, except the right of such Holders to
receive Debentures upon surrender of certificates representing such Securities.

 

4.             Redemption and
Distribution.

 

(a)           The Debentures will
mature on December 15, 2036. 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, 2011 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 

 

A-I-7

 

of the date of such opinion, subject to United States federal income
tax with respect to income received or accrued on the Debentures; (ii) interest
payable by the Debenture Issuer on the Debentures is not, or within 90 days of
the date of such opinion, will not be, deductible by the Debenture Issuer, in
whole or in part, for United States federal income tax purposes; or (iii) the
Trust is, or will be within 90 days of the date of such opinion, subject to
more than a de minimis amount of other taxes (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
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 in, the laws, rules or regulations of the United States or any
political subdivision thereof or therein, or as the result of any official or
administrative pronouncement or action or decision interpreting or applying
such laws, rules or regulations, which amendment or change is effective or
which pronouncement, action or decision is announced on or after the date of
original issuance of the Capital Securities, 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 OTS, as applicable (or any successor regulatory authority with jurisdiction
over bank, savings & loan or financial holding companies), as then in
effect and applicable to the Debenture Issuer; provided, however,
that the inability of the Debenture Issuer to treat all or any portion of the
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 Debt Securities in connection with the liquidation of the
Trust by the Debenture Issuer shall not in and of itself constitute a Capital
Treatment Event unless such liquidation shall have occurred in connection with
a Tax Event or an Investment Company Event.

 

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

 

“Redemption
Price” means 100% of the principal amount of the Debentures being redeemed plus
accrued and unpaid interest on such Debentures to the Redemption Date or, in
the 

 

A-I-8

 

case of a redemption due to the occurrence of a Special Event, to the
Special Redemption Date if such Special Redemption Date is on or after December 15, 2011.

 

“Special
Redemption Price” means (1) if the Special Redemption Date is before December 15, 2011, One Hundred Five Percent
(105%) of the principal amount to be redeemed plus any accrued and unpaid
interest thereon to the date of such redemption and (2) if the Special
Redemption Date is on or after December 15, 2011,
the Redemption Price for such Special Redemption Date.

 

“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, 2011.

 

(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
Holder shall affect the validity of the redemption or exchange proceedings with
respect to any other Holder.

 

A-I-9

 

(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 or Special Redemption Date, as
applicable, irrevocably deposit with the Depositary for such Book-Entry Capital
Securities, to the extent available therefor, funds sufficient to pay the
relevant Redemption Price or Special Redemption Price, as applicable, and will
give such Depositary irrevocable instructions and authority to pay the
Redemption Price or Special Redemption Price, as applicable, 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 or Special Redemption
Price, as applicable, 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 or Special Redemption Price, as
applicable, 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 or
Special Redemption Price, as applicable, 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 or Special Redemption Price, as applicable, 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 or Special Redemption Price, as
applicable. 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 

 

A-I-10

 

any Capital Securities so selected for redemption, in whole or in part,
except for the unredeemed portion of any Capital Securities being redeemed in
part.

 

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

 

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

 

5.             Voting Rights -
Capital Securities.

 

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

 

(b)           Subject to the
requirements of obtaining a tax opinion by the Institutional Trustee in certain
circumstances set forth in the last sentence of this paragraph, the Holders of
a Majority in liquidation amount of the Capital Securities, voting separately
as a class, have the right to direct the time, method, and place of conducting
any proceeding for any remedy available to the Institutional Trustee, or
exercising any trust or power conferred upon the Institutional Trustee under
the Declaration, including 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 

 

A-I-11

 

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

 

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

 

A-I-12

 

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

 

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

 

6.             Voting Rights -
Common Securities.

 

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

 

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

 

(c)           Subject to Section 6.8
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.

 

A-I-13

 

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

 

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

 

7.             Amendments to
Declaration and Indenture.

 

(a)           In addition to any
requirements under Section 11.1 of the Declaration, if any proposed amendment
to the Declaration provides for, or the Trustees otherwise propose to effect,
(i) any action that would adversely affect the powers, preferences or special
rights of the Securities, whether by way of amendment to the Declaration or
otherwise, or (ii) the Liquidation of the Trust, other than as described in
Section 7.1 of the Declaration, then the Holders of outstanding Securities,
voting together as a single class, will be entitled to vote on such amendment
or proposal and such amendment or proposal shall not be effective except with
the approval of the Holders of 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 

 

A-I-14

 

deemed an “investment company” which is
required to be registered under the Investment Company Act.

 

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

 

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

 

9.             Ranking. The
Capital Securities rank pari passu with, and payment thereon shall be made Pro
Rata with, the Common Securities except that, where an Event of Default has
occurred and is continuing, the rights of Holders of the Common Securities to
receive payment of Distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights of the Holders of the Capital
Securities with the result that no payment of any Distribution on, or
Redemption Price 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

 

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

 

EXHIBIT A-1

 

FORM OF CAPITAL
SECURITY CERTIFICATE

 

[FORM OF FACE OF SECURITY]

 

THIS CAPITAL
SECURITY IS A GLOBAL CAPITAL 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 MAINSOURCE STATUTORY TRUST IV 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 CEDE & CO. OR 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

 

ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN “ACCREDITED INVESTOR,” FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (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 OR AN APPLICABLE
EXEMPTION THEREFROM.

 

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

 

A-1-2

 

IN CONNECTION
WITH ANY TRANSFER, THE HOLDER 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.

 

A-1-3

 

	
  Certificate
  Number  [P-001]

  	
   

  	
  Number of
  Capital Securities 11,000

  

 

CUSIP NO:                 

 

Certificate Evidencing Capital Securities

 

of

 

MainSource Statutory
Trust IV

 

Capital Securities

 

(liquidation amount $1,000 per Capital
Security)

 

MainSource
Statutory Trust IV, a statutory trust created under the laws of
the State of Delaware (the “Trust”), hereby certifies that Cede & Co., as
nominee on behalf of The Depository Trust Company (the “Holder”), is the
registered owner of 11,000 capital
securities of the Trust representing undivided beneficial interests in the
assets of the Trust, designated the capital 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 October 13, 2006, among James L. Saner, Sr. and James M. Anderson, as Administrators, Wells Fargo Delaware Trust
Company, as Delaware Trustee, Wells Fargo Bank, National Association, as
Institutional Trustee, MainSource Financial
Group, Inc., as Sponsor, and the holders from time to time of undivided
beneficial interests in the assets of the Trust, including the designation of
the terms of the Capital Securities as set forth in Annex I to the Declaration,
as the same may be amended from time to time (the “Declaration”). Capitalized
terms used herein but not defined shall have the meaning given them in the
Declaration. The Holder is entitled to the benefits of the Guarantee 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 Delaware, without regard to principles of conflict of laws.

 

A-1-4

 

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

 

	
   

  	
  MainSource Statutory Trust IV

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:  Administrator

  
	
   

  	
   

  
	
   

  	
  Dated:

  	
   

  	
   

  
						

 

CERTIFICATE OF AUTHENTICATION

 

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

 

	
   

  	
  WELLS FARGO BANK, NATIONAL

  
	
   

  	
  ASSOCIATION,

  
	
   

  	
  not in its individual capacity but solely as the Institutional
  Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  
	
   

  	
   

  
	
   

  	
  Dated

  	
   

  	
   

  
					

 

A-1-5

 

[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 1.63% (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. The amount of Distributions payable for any period
will be computed for any full quarterly Distribution period on the basis of a
360-day year 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 December 15, 2006 (each, a
“Distribution Payment Date”). Upon submission of Notice and so long as no Event
of Default pursuant to paragraphs (c), (e), (f) or (g) 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 

 

A-1-6

 

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 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

 

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

 

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

 

	
  Certificate
  Number  [C-001]

  	
   

  	
  Number of
  Common Securities 341

  

 

Certificate Evidencing Common Securities

of
MainSource Statutory Trust IV

 

MainSource
Statutory Trust IV, a statutory trust created under the laws of
the State of Delaware (the “Trust”), hereby certifies that MainSource Financial Group, Inc. (the “Holder”)
is the registered owner of 341 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 October 13, 2006,
among James L. Saner, Sr. and James M. Anderson, as Administrators, Wells
Fargo Delaware Trust Company, as Delaware Trustee, Wells Fargo 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 Delaware, without regard to principles of conflict of laws.

 

A-2-2

 

IN WITNESS
WHEREOF, the Trust has executed this certificate as of this         
day of                        ,
2006.

 

	
   

  	
  MainSource Statutory Trust IV

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
   

  	 

	
   

  	
   

  	
  Title:  Administrator

  
					

 

A-2-3

 

[FORM OF REVERSE OF SECURITY]

 

Distributions
payable on each Common Security will be identical in amount to the
Distributions payable on each Capital Security, which is at a variable per
annum rate of interest, reset quarterly, equal to LIBOR (as defined in the
Declaration) plus 1.63% (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. The amount of Distributions payable for any
period will be computed for any full quarterly Distribution period on the basis
of a 360-day year 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 December 15, 2006 (each, a
“Distribution Payment Date”). Upon submission of Notice and so long as no Event
of Default pursuant to paragraphs (c), (e), (f) or (g) 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

 

A-2-4

 

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 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

 

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-2-6

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