Document:

<PAGE>
                                  EXHIBIT 10.3

        INDENTURE WITH RESPECT TO THE COMPANY'S 7.25% CONVERTIBLE JUNIOR
                            SUBORDINATED DEBENTURES

                    SOUTHERN COMMUNITY FINANCIAL CORPORATION

                                      AND

                      WILMINGTON TRUST COMPANY, AS TRUSTEE

                                   INDENTURE

                     7.25% CONVERTIBLE DEFERRABLE INTEREST
                         JUNIOR SUBORDINATED DEBENTURES

                               DUE MARCH 31, 2032

                         DATED AS OF FEBRUARY 13, 2002

                                     Page 1
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                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                        PAGE

<S>                                                                                                     <C>
ARTICLE I DEFINITIONS.....................................................................................7
Section 1.1 Definitions of Terms .........................................................................7

ARTICLE II ISSUE, DESCRIPTION, TERMS, CONDITIONS REGISTRATION
AND EXCHANGE OF THE DEBENTURES ...........................................................................13
Section 2.1 Designation and Principal Amount .............................................................13
Section 2.2 Maturity .....................................................................................13
Section 2.3 Form and Payment..............................................................................14
Section 2.4 Interest .....................................................................................14
Section 2.4A Defaulted Interest...........................................................................14
Section 2.5 Execution and Authentications ................................................................15
Section 2.6 Registration of Transfer and Exchange ........................................................16
Section 2.7 Temporary Debentures .........................................................................16
Section 2.7A Global Securities............................................................................17
Section 2.8 Mutilated, Destroyed, Lost or Stolen Debentures ..............................................18
Section 2.9 Cancellation .................................................................................18
Section 2.10 Benefit of Indenture ........................................................................18
Section 2.11 Authenticating Agent.........................................................................19
Section 2.12 Right of Set-off.............................................................................19
Section 2.13 CUSIP Numbers................................................................................19

ARTICLE III REDEMPTION OF DEBENTURES .....................................................................19
Section 3.1 Redemption ...................................................................................19
Section 3.2 Special Event Redemption .....................................................................19
Section 3.3 Optional Redemption by Corporation ...........................................................20
Section 3.4 Notice of Redemption .........................................................................20
Section 3.5 Payment Upon Redemption ......................................................................21
Section 3.6 No Sinking Fund ..............................................................................22

ARTICLE IV CONVERSION OF DEBENTURES ......................................................................22
Section 4.1 Conversion Rights ............................................................................22
Section 4.2 Conversion Procedures ........................................................................22
Section 4.3 Conversion Ratio Adjustments .................................................................24
Section 4.4 Reclassification, Consolidation, Merger or Sale of Assets ....................................26
Section 4.5 Notice of Adjustments of Conversion Ratio ....................................................27
Section 4.6 Prior Notice of Certain Events................................................................27
Section 4.7 Certain Defined Terms ........................................................................27
Section 4.8 Dividend or Interest Reinvestment Plans ......................................................28
Section 4.9 Certain Additional Rights ....................................................................28
Section 4.10 Trustee Not Responsible for Determining Conversion Ratio or Adjustments .....................28

ARTICLE V EXTENSION OF INTEREST PAYMENT PERIOD ...........................................................29
Section 5.1 Extension of Interest Payment Period..........................................................29
Section 5.2 Notice of Extension ..........................................................................29
Section 5.3 Limitation on Transactions ...................................................................30
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<TABLE>
<S>                                                                                                       <C>
ARTICLE VI PARTICULAR COVENANTS OF THE COMPANY............................................................30
Section 6.1 Payment of Principal and Interest.............................................................30
Section 6.2 Maintenance of Agency ........................................................................30
Section 6.3 Paying Agents ................................................................................31
Section 6.4 Appointment to Fill Vacancy in Office of Trustee .............................................31
Section 6.5 Compliance with Consolidation Provisions .....................................................31
Section 6.6 Limitation on Transactions ...................................................................32
Section 6.7 Covenants as to the Trust ....................................................................32
Section 6.8 Covenants as to Purchases ....................................................................32
Section 6.9 Waiver of Usury, Stay or Extension Laws ......................................................32

ARTICLE VII DEBENTUREHOLDERS' LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE ..........................................................................................33
Section 7.1 Corporation to Furnish Trustee Names and Addresses of Debentureholders .......................33
Section 7.2 Preservation of Information; Communications with Debentureholders ............................33
Section 7.3 Reports by the Corporation ...................................................................33
Section 7.4 Reports by the Trustee .......................................................................34
Section 7.5 Statements as to Default......................................................................34

ARTICLE VIII REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
ON EVENT OF DEFAULT ......................................................................................34
Section 8.1 Events of Default ............................................................................34
Section 8.2 Collection of Indebtedness and Suits for Enforcement by Trustee ..............................35
Section 8.3 Application of Moneys Collected ..............................................................36
Section 8.4 Limitation on Suits ..........................................................................37
Section 8.5 Rights and Remedies Cumulative; Delay or Omission not Waiver..................................37
Section 8.6 Control by Debentureholders ..................................................................37
Section 8.7 Undertaking to Pay Costs .....................................................................38
Section 8.8 Direct Action by Holders of Preferred Securities .............................................38

ARTICLE IX FORM OF DEBENTURE AND ORIGINAL ISSUE ..........................................................38
Section 9.1 Form of Debenture ............................................................................38
Section 9.2 Original Issue of Debentures .................................................................39

ARTICLE X CONCERNING THE TRUSTEE .........................................................................39
Section 10.1 Certain Duties and Responsibilities .........................................................39
Section 10.2 Notice of Defaults ..........................................................................40
Section 10.3 Certain Rights of Trustee ...................................................................40
Section 10.4 Trustee Not Responsible for Recitals, etc. ..................................................41
Section 10.5 May Hold Debentures .........................................................................41
Section 10.6 Moneys Held in Trust ........................................................................41
Section 10.7 Compensation and Reimbursement ..............................................................41
Section 10.8 Reliance on Officers' Certificate ...........................................................42
Section 10.9 Disqualification; Conflicting Interests......................................................42
Section 10.10 Corporate Trustee Required; Eligibility ....................................................42
Section 10.11 Resignation and Removal; Appointment of Successor ..........................................42
Section 10.12 Acceptance of Appointment by Successor .....................................................43
Section 10.13 Merger, Conversion, Consolidation or Succession to Business ................................44
Section 10.14 Preferential Collection of Claims Against the Company ......................................44
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<TABLE>
<S>                                                                                                       <C>
ARTICLE XI CONCERNING THE DEBENTUREHOLDERS................................................................44
Section 11.1 Evidence of Action by Holders................................................................44
Section 11.2 Proof of Execution by Debentureholders.......................................................44
Section 11.3 Who May be Deemed Owners.....................................................................45
Section 11.4 Certain Debentures Owned by Company Disregarded..............................................45
Section 11.5 Actions Binding on Future Debentureholders...................................................45

ARTICLE XII SUPPLEMENTAL INDENTURES.......................................................................45
Section 12.1 Supplemental Indentures Without the Consent of Debentureholders..............................45
Section 12.2 Supplemental Indentures with Consent of Debentureholders.....................................46
Section 12.3 Effect of Supplemental Indentures............................................................47
Section 12.4 Debentures Affected by Supplemental Indentures...............................................47
Section 12.5 Execution of Supplemental Indentures.........................................................47

ARTICLE XIII SUCCESSOR CORPORATION........................................................................47
Section 13.1 Corporation May Consolidate, etc. ...........................................................47
Section 13.2 Successor Corporation Substituted ...........................................................48
Section 13.3 Evidence of Consolidation, etc. to Trustee...................................................48

ARTICLE XIV SATISFACTION AND DISCHARGE ...................................................................48
Section 14.1 Satisfaction and Discharge of Indenture .....................................................48
Section 14.2 Discharge of Obligations ....................................................................49
Section 14.3 Deposited Moneys to be Held in Trust ........................................................49
Section 14.4 Payment of Monies Held by Paying Agents......................................................49
Section 14.5 Repayment to Corporation ....................................................................49

ARTICLE XV IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS ............................................................................................50
Section 15.1 No Recourse .................................................................................50

ARTICLE XVI MISCELLANEOUS PROVISIONS .....................................................................50
Section 16.1 Effect on Successors and Assigns ............................................................50
Section 16.2 Actions by Successor ........................................................................50
Section 16.3 Surrender of Corporation Powers .............................................................51
Section 16.4 Notices .....................................................................................51
Section 16.5 Governing Law ...............................................................................51
Section 16.6 Treatment of Debentures as Debt .............................................................51
Section 16.7 Compliance Certificates and Opinions ........................................................51
Section 16.8 Payments on Business Days ...................................................................51
Section 16.9 Trust Indenture Act; Conflicts with Trust Indenture Act .....................................52
Section 16.10 Counterparts ...............................................................................52
Section 16.11 Severability ...............................................................................52
Section 16.12 Assignment .................................................................................52
Section 16.13 Acknowledgment of Rights ...................................................................52

ARTICLE XVII SUBORDINATION OF DEBENTURES .................................................................52
Section 17.1 Agreement to Subordinate ....................................................................52
Section 17.2 Default on Senior Debt or Subordinated Debt..................................................53
Section 17.3 Liquidation; Dissolution; Bankruptcy ........................................................53
Section 17.4 Subrogation .................................................................................54
Section 17.5 Trustee to Effectuate Subordination .........................................................54
Section 17.6 Notice by the Corporation....................................................................54
Section 17.7 Rights of the Trustee; Holders of Senior Indebtedness .......................................55
Section 17.8 Subordination may not be Impaired............................................................55
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                             CROSS-REFERENCE TABLE

<TABLE>
<CAPTION>
Section of Trust Indenture Act                                                            Section of Indenture
Of 1939, As Amended

<S>                                                                                       <C>
310(a)............................................................................................10.10
310(b)............................................................................................10.9
310(c).......................................................................................Not Applicable
311(a)............................................................................................10.14
311(b)............................................................................................10.14
311(c).......................................................................................Not Applicable
312(a).............................................................................................7.1
312(b).............................................................................................7.2(c)
312(c).............................................................................................7.2(c)
313(a).............................................................................................7.4(a)
313(b).............................................................................................7.4(b)
313(c).............................................................................................7.4(a)
313(d).............................................................................................7.4(c)
314(a).............................................................................................7.3(a)
314(b).......................................................................................Not Applicable
314(c)............................................................................................16.7
314(d).......................................................................................Not Applicable
314(e)............................................................................................16.7
314(f).......................................................................................Not Applicable
315(a)............................................................................................10.1(a)
315(b)............................................................................................10.2
315(c)............................................................................................10.1(a)
315(d)............................................................................................10.1(b)
315(e).............................................................................................8.7
316(a).............................................................................................1.1
316(b).............................................................................................8.4(b)
316(c)............................................................................................11.1(b)
317(a).............................................................................................8.2
317(b).............................................................................................6.3
318(a)............................................................................................16.9
</TABLE>

      Note: This reconciliation and tie sheet shall not, for any purpose,
                    be deemed to be a part of the Indenture

                                     Page 5
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                                   INDENTURE

INDENTURE, dated as of February 13, 2002, between SOUTHERN COMMUNITY FINANCIAL
CORPORATION, a North Carolina Corporation (the "Corporation"), and WILMINGTON
TRUST COMPANY, a Delaware banking corporation (the "Trustee").

                                    RECITALS

WHEREAS, for its lawful corporate purposes, the Corporation has duly authorized
the execution and delivery of this Indenture to provide for the issuance of
unsecured securities to be known as its 7.25% Convertible Deferrable Interest
Junior Subordinated Debentures due March 31, 2032 (hereinafter referred to as
the "Debentures"), the form and substance of such Debentures and the terms,
provisions and conditions thereof to be set forth as provided in this
Indenture; and

WHEREAS, Southern Community Capital Trust I, a Delaware statutory business
trust (the "Trust"), has offered to the public up to $17,250,000 aggregate
liquidation amount of its Preferred Securities (as defined herein) and proposes
to invest the proceeds from such offering, together with the proceeds of the
issuance and sale by the Trust to the Corporation of up to $534,000 aggregate
liquidation amount of its Common Securities (as defined herein), in up to
$17,784,000 aggregate principal amount of the Debentures; and

WHEREAS, the Corporation has requested that the Trustee execute and deliver
this Indenture; and

WHEREAS, all requirements necessary to make this Indenture a valid instrument
in accordance with its terms, and to make the Debentures, when executed by the
Corporation and authenticated and delivered by the Trustee, the valid
obligations of the Corporation, have been performed, and the execution and
delivery of this Indenture have been duly authorized in all respects; and

WHEREAS, to provide the terms and conditions upon which the Debentures are to
be authenticated, issued and delivered, the Corporation has duly authorized the
execution of this Indenture; and

WHEREAS, all things necessary to make this Indenture a valid agreement of the
Corporation, in accordance with its terms, have been done.

NOW, THEREFORE, in consideration of the premises and the purchase of the
Debentures by the Trust, it is mutually covenanted and agreed as follows for
the equal and ratable benefit of the holders of the Debentures and intending to
be legally bound hereby:

                                     Page 6
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                                   ARTICLE I.
                                  DEFINITIONS

SECTION 1.1       DEFINITIONS OF TERMS.

The terms defined in this Section 1.1 (except as in this Indenture otherwise
expressly provided or unless the context otherwise requires) for all purposes
of this Indenture and of any indenture supplemental hereto shall have the
respective meanings specified in this Section 1.1 and shall include the plural
as well as the singular. All other terms that are used in this Indenture that
are defined in the Trust Indenture Act, or that are by reference in the Trust
Indenture Act defined in the Securities Act (except as herein otherwise
expressly provided or unless the context otherwise requires), shall have the
meanings assigned to such terms in the Trust Indenture Act and in the
Securities Act as in force at the date of the execution of this Indenture. All
accounting terms used herein and not expressly defined shall have the meanings
assigned to such terms in accordance with Generally Accepted Accounting
Principles as in effect at the time of computation.

         "Accelerated Maturity Date" shall be the date selected by the
Corporation pursuant to Section 3.3 hereunder, provided that such date shall
not precede April 1, 2007, except as otherwise provided in Section 3.3(a)
hereof.

         "Additional Interest" shall have the meaning set forth in Section 2.4
of this Indenture.

         "Administrative Trustees" shall have the meaning set forth in the
Trust Agreement.

         "Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding with power to vote 10% or
more of the outstanding voting securities or other ownership interests of the
specified Person; (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person; (c) any Person
directly or indirectly controlling, controlled by, or under common control with
the specified Person; (d) a partnership in which the specified Person is a
general partner; (e) any officer or director of the specified Person; and (f)
if the specified Person is an individual, any entity of which the specified
Person is an executive officer, director or general partner.

         "Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depository for such Global Security, in each case
to the extent applicable to such transaction and as in effect from time to
time.

         "Authenticating Agent" means an authenticating agent with respect to
the Debentures appointed by the Trustee pursuant to Section 2.11.

         "Bankruptcy Law" means Title 11, U.S. Code, or any similar federal or
state law for the relief of debtors.

         "Board of Directors" means the Board of Directors of the Corporation
or any duly authorized committee of such Board.

         "Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Corporation to have been duly
adopted by the Board of Directors and to be in full force and effect on the
date of such certification.

         "Business Day" means, with respect to the Debentures, any day other
than a Saturday or a Sunday or a day on which banking institutions in the City
of New York, New York are authorized or required by law, executive order or
regulation to close, or a day on which the principal Corporate Trust Office of
the Trustee or the Property Trustee is closed for business.

         "Capital Treatment Event" means the receipt by the Trust of an Opinion
of Counsel rendered by a law firm knowledgeable in such matters, to the effect
that, as a result of any amendment to, or change (including any proposed
change) in, the laws (or any regulations thereunder) of the United States or
any political subdivision thereof or therein, or as a result of any official or
administrative pronouncement or action or judicial decision

                                     Page 7

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interpreting or applying such laws or regulations, which amendment or change is
effective or such proposed change pronouncement, action or decision is
announced on or after the date of original issuance of the Preferred Securities
under the Trust Agreement, there is more than an insubstantial risk that the
Preferred Securities would not constitute "Tier 1 Capital" (or the then
equivalent thereof) for purposes of the capital adequacy guidelines of the
Federal Reserve (or any successor regulatory authority with jurisdiction over
bank holding companies), or any capital adequacy guidelines as then in effect
and applicable to the Corporation.

         "Certificate" means a certificate signed by the principal executive
officer, the principal financial officer, the principal accounting officer, the
treasurer or any vice president of the Corporation. The Certificate need not
comply with the provisions of Section 16.7.

         "Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then
the body performing such duties at such time.

         "Common Securities" means undivided beneficial interests in the assets
of the Trust which rank pari passu with the Preferred Securities; provided,
however, that upon the occurrence of an Event of Default, the rights of holders
of Common Securities to payment in respect of (i) distributions and (ii)
payments upon liquidation, redemption and otherwise are subordinated to the
rights of holders of Preferred Securities.

         "Compounded Interest" shall have the meaning set forth in Section 5.1.

         "Conversion Agent" means the Person appointed to act on behalf of the
holders of the Preferred Securities in effecting the conversion of Preferred
Securities to Debentures and Debentures to Common Stock as and in the manner
set forth in the Trust Agreement and this Indenture.

         "Conversion Ratio" has the meaning set forth in Section 4.1.

         "Conversion Request" means (a) the irrevocable request to be given by
a Debentureholder to the Conversion Agent directing the Conversion Agent to
convert the Debentures into shares of Common Stock, and (b) the irrevocable
request to be given by a holder of Preferred Securities to the Conversion Agent
directing the Conversion Agent to exchange such stock on behalf of such holder.

         "Corporate Trust Office" means (i) when used with respect to the
Trustee, the office of the Trustee at which, at any particular time, its
corporate trust business shall be principally administered, which office at the
date hereof is located at Rodney Square North, 1100 North Market Street,
Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration, or
(ii) when used with respect to the Property Trustee, the office of the Property
Trustee, at which, at any particular time, its corporate trust business shall
be principally administered, which office at the date hereof is located at
Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001,
Attention: Corporate Trust Administration.

         "Corporation" means Southern Community Financial Corporation, a
corporation duly organized and existing under the laws of the State of North
Carolina, and, subject to the provisions of Article XIII, shall also include
its successors and assigns.

         "Coupon Rate" shall mean 7.25%.

         "Custodian" means any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.

         "Debentures" shall have the meaning set forth in the Recitals hereto.

         "Debentureholder," "holder of Debentures," "registered holder," or
other similar term, means the Person or Persons in whose name or names a
particular Debenture shall be registered on the books of the Corporation or the
Trustee kept for that purpose in accordance with the terms of this Indenture.

                                     Page 8

<PAGE>

         "Debenture Register" shall have the meaning set forth in Section
2.6(b).

         "Debt" means with respect to any Person, whether recourse is to all or
a portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
indebtedness of such Person, whether incurred on or prior to the date of the
Indenture or thereafter incurred, for claims in respect of financial derivative
products, including interest rate, foreign exchange rate and commodity forward
contracts, options, swaps and similar arrangements; (vii) every obligation of
the type referred to in clauses (i) through (v) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has guaranteed or is responsible or liable, directly or indirectly, as obligor
or otherwise.

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

         "Defaulted Interest" has the meaning provided in Section 2.4A hereof.

         "Deferred Interest" shall have the meaning set forth in Section 5.1.

         "Depository" means, with respect to the Debentures issuable or issued
in whole or in part in the form of one or more Global Securities, the Person
designated as Depository by the Corporation pursuant to Section 2.3. The
initial Depository shall be Depository Trust Company (DTC).

         "Dissolution Event" means that as a result of the occurrence and
continuation of a Special Event, the Trust is to be dissolved in accordance
with the Trust Agreement and the Debentures held by the Property Trustee are to
be distributed to the holders of the Trust Securities issued by the Trust pro
rata in accordance with the Trust Agreement.

         "Event of Default" means, with respect to the Debentures, any event
specified in Section 8.1, which has continued for the period of time, if any,
and after the giving of the notice, if any, therein designated.

         "Exchange Act," means the Securities Exchange Act of 1934, as amended,
as in effect at the date of execution of this Indenture.

         "Extended Interest Payment Period" shall have the meaning set forth in
Section 5.1.

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

         "Generally Accepted Accounting Principles" means such accounting
principles as are generally accepted at the time of any computation required
hereunder.

         "Global Security" means a Debenture evidencing all or part of the
Debentures, issued to the Depository or its nominee, and registered in the name
of such Depository or its nominee.

         "Governmental Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged; or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America, the payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America that, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such Governmental
Obligation or a specific payment of principal of or interest on any such
Governmental Obligation held by such custodian for the account of the holder of
such depository receipt; provided, however, that (except as required by law)
such custodian

                                     Page 9

<PAGE>

is not authorized to make any deduction from the amount payable to the holder
of such depository receipt from any amount received by the custodian in respect
of the Governmental Obligation or the specific payment of principal of or
interest on the Governmental Obligation evidenced by such depository receipt.

         "Herein," "hereof," and "hereunder," and other words of similar
import, refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.

         "Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into in accordance with the terms hereof.

         "Interest Payment Date," when used with respect to any installment of
interest on the Debentures, shall have the meaning set forth in Section 2.4.

         "Investment Company Act," means the Investment Company Act of 1940, as
amended, as in effect at the date of execution of this Indenture.

         "Investment Company Event" means the receipt by the Trust of an
Opinion of Counsel rendered by a law firm knowledgeable in such matters, to the
effect that, as a result of the occurrence of a change in law or regulation or
a change in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority (a "Change
in 1940 Act Law"), the Trust is or shall be considered an "investment company"
that is required to be registered under the Investment Company Act, which
Change in 1940 Act Law becomes effective on or after the date of original
issuance of the Preferred Securities under the Trust Agreement.

         "Maturity Date" means the date on which the Debentures mature and on
which the principal shall be due and payable together with all accrued and
unpaid interest thereon including Compounded Interest and Additional Interest,
if any, as set forth in Section 2.2.

         "Ministerial Action" shall have the meaning set forth in Section 3.2.

         "Officers' Certificate" means a certificate signed by the Chairman,
President or a Vice President and by the Treasurer or an Assistant Treasurer or
the Controller or an Assistant Controller or the Secretary or an Assistant
Secretary, of the Corporation, and delivered to the Trustee. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Indenture shall include:

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

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

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

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

         "Opinion of Counsel" means an opinion in writing of independent legal
counsel experienced in such matters as being opined upon, that is delivered to
the Trustee in accordance with the terms hereof.

         "Other Debentures" means all junior subordinated debentures ranking
pari passu or junior to the Debentures (other than the Debentures) issued by
the Corporation from time to time and sold to trusts established or to be
established by the Corporation, in each case similar to the Trust to issue
securities intended to qualify for Tier I capital treatment.

                                    Page 10
<PAGE>

         "Outstanding" when used with reference to the Debentures, means,
subject to the provisions of Section 11.4, as of any particular time, all
Debentures theretofore authenticated and delivered by the Trustee under this
Indenture, except (a) Debentures theretofore canceled by the Trustee or any
paying agent, or delivered to the Trustee or any paying agent for cancellation
or that have previously been canceled; (b) Debentures or portions thereof for
the payment or redemption of which monies or Governmental Obligations in the
necessary amount shall have been deposited in trust with the Trustee or with
any paying agent (other than the Corporation) or shall have been set aside and
segregated in trust by the Corporation (if the Corporation shall act as its own
paying agent); provided, however, that if such Debentures or portions of such
Debentures are to be redeemed prior to the maturity thereof, notice of such
redemption shall have been given as provided in Article III or provision
satisfactory to the Trustee shall have been made for giving such notice; (c)
Debentures in lieu of or in substitution for which other Debentures shall have
been authenticated and delivered pursuant to the terms of Section 2.6 and (d)
Debentures paid pursuant to Section 2.8.

         "Person" means any individual, corporation, partnership,
joint-venture, trust, business trust, limited liability company, joint-stock
company, unincorporated organization or government or any agency or political
subdivision thereof.

         "Place of Payment" means the place or places where the principal of
and interest on the Debentures are payable in accordance with the terms of this
Indenture.

         "Predecessor Debenture" means every previous Debenture evidencing all
or a portion of the same debt as that evidenced by such particular Debenture;
and, for the purposes of this definition, any Debenture authenticated and
delivered under Section 2.8 in lieu of a lost, destroyed or stolen Debenture
shall be deemed to evidence the same debt as the lost, destroyed or stolen
Debenture.

         "Preferred Securities" means undivided beneficial interests in the
assets of the Trust which rank pari passu with Common Securities issued by the
Trust; provided, however, that upon the occurrence of an Event of Default, the
rights of holders of Common Securities to payment in respect of distributions
and payments upon liquidation, redemption and otherwise are subordinated to the
rights of holders of Preferred Securities.

         "Preferred Securities Guarantee" means the Preferred Securities
Guarantee Agreement dated February 13, 2002, as amended from time to time, by
and between the Corporation, as guarantor, and the Trustee, executed and
delivered for the benefit of the Holders of the Preferred Securities.

         "Prime Rate" or "Prime" means the prime rate as published in The Wall
Street Journal, and shall be adjusted daily. For days on which The Wall Street
Journal is not published, the Prime Rate shall be the prime rate that would
have been published in The Wall Street Journal if it had been published on such
day. In the event the Prime Rate shall cease to be published on a daily basis
by The Wall Street Journal or the method of its determination shall be
materially changed, then the Prime Rate shall be a comparable index rate
selected by the holders of a majority in principal amount of Debentures then
Outstanding, provided that if the Debentures are then held by the Trust or a
trustee of the Trust, such selection shall require the prior written consent of
the holders of a majority in liquidation preference of Trust Securities of the
Trust.

         "Property Trustee" has the meaning set forth in the Trust Agreement.

         "Reference Date" has the meaning set forth in Section 4.3.

         "Regular Record Date" means the 15th day of the last month of the
calendar quarter.

         "Responsible Officer" when used with respect to the Trustee means any
officer of the Trustee in its corporate trust administration who is responsible
for the administration of the Trust and whose name appears on the list of
Responsible Officers of the Trustee which shall be furnished by the Trustee to
the Corporation, as such list may be revised from time to time.

         "Scheduled Maturity Date" means March 31, 2032.

                                    Page 11
<PAGE>

         "Securities Act" means the Securities Act of 1933, or any successor
statute, in each case as amended from time to time.

         "Senior Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Corporation
whether or not such claim for post-petition interest is allowed in such
proceeding), on Debt, whether incurred on or prior to the date of this
Indenture or thereafter incurred, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is
provided that such obligations are not superior in right of payment to the
Debentures or to other Debt which is pari passu with, or subordinated to, the
Debentures; provided, however, that Senior Debt shall not be deemed to include
(i) any Debt of the Corporation which when incurred and without respect to any
election under Section 1111(b) of the Bankruptcy Law was without recourse to
the Corporation; (ii) any Debt of the Corporation to any of its subsidiaries;
(iii) any Debt to any employee of the Corporation; and (iv) Debentures or Other
Debentures, including Debentures sold by the Corporation to the Trust.

         "Senior Indebtedness" shall have the meaning set forth in Section
17.1.

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

         "Subordinated Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Corporation
whether or not such claim for post-petition interest is allowed in such
proceeding), on Debt, whether incurred on or prior to the date of this
Indenture or thereafter incurred, which is by its terms expressly provided to
be junior and subordinate to other Debt of the Corporation (other than the
Debentures), except that Subordinated Debt shall not include: (i) any Debt of
the Corporation which when incurred and without respect to any election under
Section 1111(b) of the United States Bankruptcy Code of 1978, as amended, was
without recourse to the Corporation; (ii) any Debt of the Corporation to any of
its Subsidiaries; (iii) any Debt to any employee of the Corporation; (iv)
Debentures or Other Debentures, including Debentures sold by the Corporation to
the Trust and (v) any Debt which by its terms provides that it is not superior
in right of payment to the Debentures or to other Debt which is pari passu
with, or subordinated to, the Debentures.

         "Subsidiary" means, with respect to any Person, (i) any corporation at
least a majority of whose outstanding Voting Stock shall at the time be owned,
directly or indirectly, by such Person or by one or more of its Subsidiaries or
by such Person and one or more of its Subsidiaries; (ii) any general
partnership, joint venture, trust or similar entity, at least a majority of
whose outstanding partnership or similar interests shall at the time be owned
by such Person, or by one or more of its Subsidiaries, or by such Person and
one or more of its Subsidiaries; and (iii) any limited partnership of which
such Person or any of its Subsidiaries is a general partner.

         "Tax Event" means the receipt by the Trust of an Opinion of Counsel
rendered by a law firm knowledgeable 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 or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement or decision is announced on or after the date
of issuance of the Preferred Securities under the Trust Agreement, there is
more than an insubstantial risk that (i) the Trust is, or shall be within 90
days after the date of such Opinion of Counsel, subject to United States
federal income tax with respect to income received or accrued on the
Debentures; (ii) interest payable by the Corporation on the Debentures is not,
or within 90 days after the date of such Opinion of Counsel, shall not be,
deductible by the Corporation, in whole or in part, for United States federal
income tax purposes; or (iii) the Trust is, or shall be within 90 days after
the date of such Opinion of Counsel, subject to more than a de minimis amount
of other taxes, duties, assessments or other governmental charges. The Trust or
the Corporation shall request and receive such Opinion of Counsel with regard
to such matters within a reasonable period of time after the Trust or the
Corporation shall have become aware of the possible occurrence of any of the
events described in clauses (i) through (iii) above.

            "Trust" means Southern Community Capital Trust I, a Delaware
statutory business trust created by the Trust Agreement.

                                    Page 12
<PAGE>

         "Trust Agreement" means the Amended and Restated Trust Agreement,
dated February 13, 2002, of the Trust, as amended, modified or supplemented in
accordance with the applicable provisions thereof, among the trustees of the
trust named therein, the Corporation, as depositor, and the holders from time
to time of undivided beneficial ownership interests in the assets of the Trust,
including all exhibits thereto, including, for all purposes of the Trust
Agreement, and any such modification, amendment or supplement, the provisions
of the Trust Indenture Act that are deemed to be part of and govern the Trust
Agreement and any such modification, amendment or supplement, respectively.

         "Trustee" means Wilmington Trust Company, acting not in its individual
capacity but solely as trustee under this Indenture, and, subject to the
provisions of Article X, shall also include its successors and assigns, and, if
at any time there is more than one Person acting in such capacity hereunder,
"Trustee" shall mean each such Person.

         "Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, subject to the provisions of Sections 12.1, 12.2, and 13.1, and any
successor statute thereto, in each case as amended from time to time.

         "Trust Securities" means the Common Securities and Preferred
Securities, collectively.

         "Voting Stock" as applied to stock of any Person, means shares,
interests, participations or other equivalents in the equity interest (however
designated) in such Person having ordinary voting power for the election of a
majority of the directors (or the equivalent) of such Person, other than
shares, interests, participations or other equivalents having such power only
by reason of the occurrence of a contingency.

                                  ARTICLE II.
              ISSUE, DESCRIPTION, TERMS, CONDITIONS, REGISTRATION
                         AND EXCHANGE OF THE DEBENTURES

SECTION 2.1       DESIGNATION AND PRINCIPAL AMOUNT.

         There are hereby authorized Debentures designated the "7.25%
Convertible Deferrable Interest Junior Subordinated Debentures Due March 31,
2032," limited in aggregate principal amount to not more than Seventeen Million
Seven Hundred Eighty-Four Thousand Dollars ($17,784,000) which amount shall be
as set forth in any written order of the Corporation for the authentication and
delivery of Debentures pursuant to Section 2.5.

SECTION 2.2       MATURITY.

         (a)      The Maturity Date shall be either:

                  (i)      the Scheduled Maturity Date; or

                  (ii)     if the Company elects to accelerate the Maturity
Date to be a date prior to the Scheduled Maturity Date in accordance with
Section 2.2(c), the Accelerated Maturity Date.

         (b)      The Company may at any time before the day which is 90 days
before the Scheduled Maturity Date and after March 31, 2007, elect to shorten
the Maturity Date only once to the Accelerated Maturity Date provided that the
Company has received the prior approval of the Federal Reserve if then required
under applicable capital guidelines, policies or regulations of the Federal
Reserve.

         (c)      If the Company elects to accelerate the Maturity Date in
accordance with Section 2.2(b), the Company shall give notice to the Trustee
and the Trust (unless the Trust is not the holder of the Debentures, in which
case the Trustee will give notice to the holders of the Debentures) of the
acceleration of the Maturity Date and the Accelerated Maturity Date at least 30
days and no more than 180 days before the Accelerated Maturity Date; provided,
however that nothing provided in this Section 2.2 shall limit the Company's
rights, as provided in Article III hereof, to redeem all or a portion of the
Debentures at such time or times on or after February 13, 2002, as the Company
may so determine, or at any time upon the occurrence of a Special Event.

                                    Page 13

<PAGE>

SECTION 2.3       FORM AND PAYMENT.

         The Debentures shall be issued in certificated form without interest
coupons. Principal and interest on the Debentures issued in certificated form
shall be payable, the transfer of such Debentures shall be registrable and such
Debentures shall be exchangeable for Debentures bearing identical terms and
provisions at the office or agency of the Trustee; provided, however, that
payment of interest may be made at the option of the Corporation by check
mailed to the holder at such address as shall appear in the Debenture Register
or by wire transfer to an account maintained by the holder as specified in the
Debenture Register, provided that the holder provides proper wire transfer
instructions by the Regular Record Date. Notwithstanding the foregoing, so long
as the holder of any Debentures is the Property Trustee, the payment of the
principal of and interest on such Debentures held by the Property Trustee shall
be made at such place and to such account as may be designated by the Property
Trustee.

         Debentures shall be issuable in whole or in part in the form of one or
more Global Securities and, in such case, the Depository for such Global
Securities shall be DTC.

SECTION 2.4       INTEREST.

         (a)      Each Debenture shall bear interest at the Coupon Rate from
the original date of issuance until the principal thereof becomes due and
payable, and on any overdue principal and (to the extent that payment of such
interest is enforceable under applicable law) on any overdue installment of
interest at the Coupon Rate, compounded quarterly, payable (subject to the
provisions of Article V) quarterly in arrears on March 31, June 30, September
30 and December 31 of each year (each, an "Interest Payment Date," commencing
on March 31, 2002), to the Person in whose name such Debenture or any
Predecessor Debenture is registered at 5:00 p.m., New York, New York time on
the Regular Record Date next preceding such Interest Payment Date.

         (b)      The amount of interest payable for any period shall be
computed on the basis of a 360-day year of twelve 30-day months. Any change in
the Coupon Rate shall be effective on the date of such change for purposes of
calculating interest for any period. Except as provided in the following
sentence, the amount of interest payable for any period shorter than a full
quarterly period for which interest is computed, shall be computed on the basis
of the actual number of days elapsed in such period, based on a 360-day year of
twelve 30-day months. In the event that any date on which interest is payable
on the Debentures is not a Business Day, then payment of interest payable on
such date shall be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day (and without
any reduction of interest or any other payment in respect of any such
acceleration), in each case with the same force and effect as if made on the
date such payment was originally payable.

         (c)      If, at any time while the Property Trustee is the holder of
any Debentures, the Trust or the Property Trustee is required to pay any income
or other taxes, duties, assessments or governmental charges of whatever nature
(other than withholding taxes) imposed by the United States, or any other
taxing authority, then, in any case, the Corporation shall pay as additional
interest ("Additional Interest") on the Debentures held by the Property
Trustee, such additional amounts as shall be required so that the net amounts
received and retained by the Trust and the Property Trustee after paying such
taxes, duties, assessments or other governmental charges shall be equal to the
amounts the Trust and the Property Trustee would have received had no such
taxes, duties, assessments or other governmental charges been imposed.

SECTION 2.4A      DEFAULTED INTEREST.

         Any interest on any Debenture that is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date and (to the extent that
payment of such interest is enforceable) interest on any overdue installment of
interest at the Coupon Rate, compounded quarterly (herein called "Defaulted
Interest") shall, notwithstanding the provisions of Section 2.4(a), forthwith
cease to be payable to the holder on the relevant Regular Record Date by

                                    Page 14

<PAGE>

virtue of having been such holder; and such Defaulted Interest shall be paid by
the Corporation, at its election, as provided in clause (a) or clause (b)
below:

         (a)      The Corporation may make payment of any Defaulted Interest on
Debentures to the Persons in whose names such Debentures (or their respective
Predecessor Debentures) are registered at 5:00 p.m., New York, New York time on
a special record date for the payment of such Defaulted Interest, which shall
be fixed in the following manner: the Corporation shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each such
Debenture and the date of the proposed payment, and at the same time the
Corporation shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit prior to
the date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as herein
provided. Thereupon the Trustee shall fix a special record date for the payment
of such Defaulted Interest which shall not be more than 15 nor less than 10
days prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The Trustee
shall promptly notify the Corporation of such special record date and, in the
name and at the expense of the Corporation, shall cause notice of the proposed
payment of such Defaulted Interest and the special record date therefor to be
mailed, first class postage prepaid, to each Debentureholder at his or her
address as it appears in the Debenture Register, not less than 10 days prior to
such special record date. Notice of the proposed payment of such Defaulted
Interest and the special record date therefor having been mailed as aforesaid,
such Defaulted Interest shall be paid to the Persons in whose names such
Debentures (or their respective Predecessor Debentures) are registered on such
special record date and shall be no longer payable pursuant to Section 2.4A(b).

         (b)      The Corporation may make payment of any Defaulted Interest on
any Debentures in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Debentures may be listed,
and upon such notice as may be required by such exchange if, after notice given
by the Corporation to the Trustee of the proposed payment pursuant to this
clause, such manner of payment shall be deemed practicable by the Trustee.

SECTION 2.5       EXECUTION AND AUTHENTICATIONS.

         (a)      The Debenture(s) shall be signed on behalf of the Corporation
by its Chairman, President or one of its Vice Presidents, under its corporate
seal attested by its Secretary or one of its Assistant Secretaries. Signatures
may be in the form of a manual or facsimile signature. The Corporation may use
the facsimile signature of any Person who shall have been a Chairman, President
or Vice President thereof, or of any Person who shall have been a Secretary or
Assistant Secretary thereof, notwithstanding the fact that at the time the
Debentures shall be authenticated and delivered or disposed of such Person
shall have ceased to be the Chairman, President or a Vice President, or the
Secretary or an Assistant Secretary, of the Corporation (and any such signature
shall be binding on the Corporation). The seal of the Corporation may be in the
form of a facsimile of such seal and may be impressed, affixed, imprinted or
otherwise reproduced on the Debentures. The Debentures may contain such
notations, legends or endorsements as are required by law, stock exchange rule
or usage. Each Debenture shall be dated the date of its authentication by the
Trustee.

         (b)      A Debenture shall not be valid until authenticated manually
by an authorized signatory of the Trustee, or by an Authenticating Agent. Such
signature shall be conclusive evidence that the Debenture so authenticated has
been duly authenticated and delivered hereunder and that the holder is entitled
to the benefits of this Indenture.

         (c)      At any time and from time to time after the execution and
delivery of this Indenture, the Corporation may deliver Debentures executed by
the Corporation to the Trustee for authentication, together with a written
order of the Corporation for the authentication and delivery of such Debentures
signed by its Chairman, President or any Vice President and its Secretary or
any Assistant Secretary, and the Trustee in accordance with such written order
shall authenticate and make available for delivery such Debentures.

         (d)      In authenticating such Debentures and accepting the
additional responsibilities under this Indenture in relation to such
Debentures, the Trustee shall be entitled to receive, and (subject to Section
10.1) shall be fully protected in relying upon, an Opinion of Counsel stating
that the form and terms thereof have been established in conformity with the
provisions of this Indenture.

                                    Page 15

<PAGE>

         (e)      The Trustee shall not be required to authenticate such
Debentures if the issue of such Debentures pursuant to this Indenture shall
affect the Trustee's own rights, duties or immunities under the Debentures and
this Indenture or otherwise in a manner that is not reasonably acceptable to
the Trustee.

SECTION 2.6       REGISTRATION OF TRANSFER AND EXCHANGE.

         (a)      Debentures may be exchanged upon presentation thereof at the
office or agency of the Corporation designated for such purpose, for other
Debentures in a like aggregate principal amount, upon payment of a sum
sufficient to cover any tax or other governmental charge in relation thereto,
all as provided in this Section 2.6. In respect of any Debentures so
surrendered for exchange, the Corporation shall execute, the Trustee shall
authenticate and such office or agency shall deliver in exchange therefor the
Debenture or Debentures that the Debenture holder making the exchange shall be
entitled to receive, bearing numbers not contemporaneously outstanding.

         (b)      The Corporation shall keep, or cause to be kept, at its
office or agency designated for such purpose or such other location designated
by the Corporation a register or registers (herein referred to as the
"Debenture Register") in which, subject to such reasonable regulations as it
may prescribe, the Corporation shall register the Debentures and the transfers
of Debentures as in this Article II provided and which at all reasonable times
shall be open for inspection by the Trustee. The registrar for the purpose of
registering Debentures and transfer of Debentures as herein provided shall be
appointed as authorized by Board Resolution (the "Debenture Registrar"). Upon
surrender for transfer of any Debenture at the office or agency of the
Corporation designated for such purpose, the Corporation shall execute, the
Trustee shall authenticate and such office or agency shall make available for
delivery in the name of the transferee or transferees a new Debenture or
Debentures for a like aggregate principal amount. All Debentures presented or
surrendered for exchange or registration of transfer, as provided in this
Section 2.6, shall be accompanied (if so required by the Corporation or the
Debenture Registrar) by a written instrument or instruments of transfer, in a
form satisfactory to the Corporation or the Debenture Registrar, duly executed
by the registered holder or by such holder's duly authorized attorney in
writing.

         (c)      No service charge shall be made for any exchange or
registration of transfer of Debentures, or issue of new Debentures in case of
partial redemption, but the Corporation may require payment of a sum sufficient
to cover any tax or other governmental charge in relation thereto, other than
exchanges pursuant to Section 2.7, Section 3.5(b) and Section 12.4 not
involving any transfer.

         (d)      The Corporation shall not be required (i) to issue, exchange
or register the transfer of any Debentures during a period beginning at the
opening of business 15 days before the day of the mailing of a notice of
redemption of less than all the Outstanding Debentures and ending at 5:00 p.m.,
New York, New York time on the day of such mailing; nor (ii) to register the
transfer or exchange of any Debentures or portions thereof called for
redemption.

         (e)      Notwithstanding any other provision of this Indenture,
transfers and exchanges of Debentures, whether pursuant to this Article II,
Section 3.5, Article X or otherwise, shall be made only in accordance with this
Section 2.6(e).

                  (i)      A Debenture that is not a Global Security may be
                           transferred, in whole or in part, to a Person who
                           takes delivery in the form of another Debenture that
                           is not a Global Security or may be exchanged, in
                           whole or in part, for another Debenture that is not
                           a Global Security, as provided in this Section 2.6.

                  (ii)     A beneficial interest in a Global Security may be
                           transferred or exchanged for a Debenture that is not
                           a Global Security only as provided in Section 2.7A.

SECTION 2.7       TEMPORARY DEBENTURES.

         Pending the preparation of definitive Debentures, the Corporation may
execute, and the Trustee shall authenticate and deliver, temporary Debentures
(printed, lithographed, or typewritten). Such temporary Debentures shall be
substantially in the form of the definitive Debentures in lieu of which they
are issued, but with such omissions, insertions and variations as may be
appropriate for temporary Debentures, all as may be determined by the
Corporation. Every temporary Debenture shall be executed by the Corporation and
be authenticated by the

                                    Page 16

<PAGE>

Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Debentures. Without unnecessary delay the
Corporation shall execute and shall furnish definitive Debentures and thereupon
any or all temporary Debentures may be surrendered in exchange therefor
(without charge to the holders), at the office or agency of the Corporation
designated for such purpose, and the Trustee shall authenticate and such office
or agency shall deliver in exchange for such temporary Debentures an equal
aggregate principal amount of definitive Debentures, unless the Corporation
advises the Trustee to the effect that definitive Debentures need not be
executed and furnished until further notice from the Corporation. Until so
exchanged, the temporary Debentures shall be entitled to the same benefits
under this Indenture as definitive Debentures authenticated and delivered
hereunder.

SECTION 2.7A      GLOBAL SECURITIES.

         (a)      Each Global Security issued under this Indenture shall be
registered in the name of the Depositary designated by the Corporation for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.

         (b)      Notwithstanding any other provision in this Indenture, no
Global Security may be exchanged in whole or in part for Debentures registered,
and no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security or a
nominee thereof unless (i) such Depositary advises the Trustee in writing that
such Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and the
Corporation is unable to locate a qualified successor, (ii) the Corporation
executes and delivers to the Trustee a Corporation order stating that the
Corporation elects to terminate the book-entry system through the Depositary,
or (iii) there shall have occurred and be continuing an Event of Default.

         (c)      If any Global Security is to be exchanged for other
Debentures or cancelled in whole, it shall be surrendered by or on behalf of
the Depositary or its nominee to the Securities Registrar for exchange or
cancellation as provided in this Article II. If any Global Security is to be
exchanged for other Debentures or cancelled in part, or if another Debenture is
to be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Article II or (ii) the principal
amount thereof shall be reduced or increased by an amount equal to the portion
thereof to be so exchanged or cancelled, or equal to the principal amount of
such Debenture to be so exchanged for a beneficial interest therein, as the
case may be, by means of an appropriate adjustment made on the records of the
Securities Registrar, whereupon the Trustee, in accordance with Applicable
Procedures, shall instruct the Depositary or its authorized representative to
make a corresponding adjustment to its records. Upon any such surrender or
adjustment of a Global Security by the Depositary, accompanied by registration
instructions, the Trustee shall, subject to Section 2.6 and as otherwise
provided in this Article II, authenticate and make available for delivery any
Debentures issuable in exchange for such Global Security (or any portion
thereof) in accordance with the instructions of the Depositary. The Trustee
shall not 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.

         (d)      Except as otherwise provided in the preceding provisions of
this Section 2.7A, every Debenture authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, a Global
Security or any portion thereof, whether pursuant to this Article II, Section
3.5 or Article X or otherwise, shall be authenticated and delivered in the form
of, and shall be, a Global Security, unless such Debenture is registered in the
name of a Person other than the Depositary for such Global Security or a
nominee thereof.

         (e)      The Depositary or its nominee, as the registered owner of a
Global Security, shall be the Holder of such Global Security for all purposes
under this Indenture and the Debenture, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security shall be
shown only on, and the transfer of such interest shall be effected only
through, records maintained by the Depositary or its nominee or agent. Neither
the Trustee nor the Securities Registrar shall have any liability in respect of
any transfers effected by the Depositary.

                                    Page 17

<PAGE>

         (f)      The rights of owners of beneficial interests in a Global
Security shall be exercised only through the Depositary and shall be limited to
those established by law and agreements between such owners and the Depositary
and/or its Agent Members.

SECTION 2.8       MUTILATED, DESTROYED, LOST OR STOLEN DEBENTURES.

         (a)      In case any temporary or definitive Debenture shall become
mutilated or be destroyed, lost or stolen, the Corporation (subject to the next
succeeding sentence) shall execute, and upon the Corporation's request the
Trustee (subject as aforesaid) shall authenticate and make available for
delivery, a new Debenture bearing a number not contemporaneously outstanding,
in exchange and substitution for the mutilated Debenture, or in lieu of and in
substitution for the Debenture so destroyed, lost or stolen. In every case the
applicant for a substituted Debenture shall furnish to the Corporation and the
Trustee such security or indemnity as may be required by them to save each of
them harmless, and, in every case of destruction, loss or theft, the applicant
shall also furnish to the Corporation and the Trustee evidence to their
satisfaction of the destruction, loss or theft of the applicant's Debenture and
of the ownership thereof. The Trustee may authenticate any such substituted
Debenture and make available for delivery the same upon the written request or
authorization of any officer of the Corporation. Upon the issuance of any
substituted Debenture, the Corporation may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee) connected therewith. In case any Debenture that has matured or is
about to mature shall become mutilated or be destroyed, lost or stolen, the
Corporation may, instead of issuing a substitute Debenture, pay or authorize
the payment of the same (without surrender thereof except in the case of a
mutilated Debenture) if the applicant for such payment shall furnish to the
Corporation and the Trustee such security or indemnity as they may require to
save them harmless, and, in case of destruction, loss or theft, evidence to the
satisfaction of the Corporation and the Trustee of the destruction, loss or
theft of such Debenture and of the ownership thereof.

         (b)      Every replacement Debenture issued pursuant to the provisions
of this Section 2.8 shall constitute an additional contractual obligation of
the Corporation whether or not the mutilated, destroyed, lost or stolen
Debenture shall be found at any time, or be enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Debentures duly issued hereunder. All Debentures shall be
held and owned upon the express condition that the foregoing provisions are
exclusive with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Debentures, and shall preclude (to the extent lawful) any and
all other rights or remedies, notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their surrender.

SECTION 2.9       CANCELLATION.

         All Debentures surrendered for the purpose of payment, redemption,
exchange or registration of transfer shall, if surrendered to the Corporation
or any paying agent, be delivered to the Trustee for cancellation, or, if
surrendered to the Trustee, shall be canceled by it, and no Debentures shall be
issued in lieu thereof except as expressly required or permitted by any of the
provisions of this Indenture. On request of the Corporation at the time of such
surrender, the Trustee shall deliver to the Corporation canceled Debentures
held by the Trustee. In the absence of such request the Trustee may dispose of
canceled Debentures in accordance with its standard procedures. If the
Corporation shall otherwise acquire any of the Debentures, however, such
acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented by such Debentures unless and until the same are
delivered to the Trustee for cancellation.

SECTION 2.10      BENEFIT OF INDENTURE.

         Nothing in this Indenture or in the Debentures, express or implied,
shall give or be construed to give to any Person, other than the parties hereto
and the holders of the Debentures (and, with respect to the provisions of
Article XVII, the holders of Senior Indebtedness) any legal or equitable right,
remedy or claim under or in respect of this Indenture, or under any covenant,
condition or provision herein contained; all such covenants, conditions, and
provisions being for the sole benefit of the parties hereto and the holders of
the Debentures (and, with respect to the provisions of Article XVII, the
holders of Senior Indebtedness).

                                    Page 18
<PAGE>

SECTION 2.11      AUTHENTICATING AGENT.

         (a)      So long as any of the Debentures remain Outstanding there may
be an Authenticating Agent for any or all such Debentures, which the Trustee
shall have the right to appoint. Said Authenticating Agent shall be authorized
to act on behalf of the Trustee to authenticate Debentures issued upon
exchange, transfer or partial redemption thereof, and Debentures so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. All references in this Indenture to the authentication of Debentures
by the Trustee shall be deemed to include authentication by an Authenticating
Agent. Each Authenticating Agent shall be acceptable to the Corporation and
shall be a corporation that has a combined capital and surplus, as most
recently reported or determined by it, sufficient under the laws of any
jurisdiction under which it is organized or in which it is doing business to
conduct a trust business, and that is otherwise authorized under such laws to
conduct such business and is subject to supervision or examination by federal
or state authorities. If at any time any Authenticating Agent shall cease to be
eligible in accordance with these provisions, it shall resign immediately.

         (b)      Any Authenticating Agent may at any time resign by giving
written notice of resignation to the Trustee and to the Corporation. The
Trustee may at any time (and upon request by the Corporation shall) terminate
the agency of any Authenticating Agent by giving written notice of termination
to such Authenticating Agent and to the Corporation. Upon resignation,
termination or cessation of eligibility of any Authenticating Agent, the
Trustee may appoint an eligible successor Authenticating Agent acceptable to
the Corporation. Any successor Authenticating Agent, upon acceptance of its
appointment hereunder, shall become vested with all the rights, powers and
duties of its predecessor hereunder as if originally named as an Authenticating
Agent pursuant hereto.

SECTION 2.12      RIGHT OF SET-OFF.

         With respect to the Debentures initially issued to the Trust,
notwithstanding anything to the contrary herein, the Corporation shall have the
right to set-off any payment it is otherwise required to make in respect of any
such Debenture to the extent the Corporation has theretofore made, or is
concurrently on the date of such payment making, a payment under the Preferred
Securities Guarantee relating to such Debenture or to a holder of Preferred
Securities pursuant to an action undertaken under Section 8.8 of this
Indenture.

SECTION 2.13      CUSIP NUMBERS.

         The Corporation in issuing the Debentures may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Debentureholders; provided that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Debentures or as contained in any notice
of a redemption and that reliance may be placed only on the other
identification numbers printed on the Debentures, and any such redemption shall
not be affected by any defect in or omission or such numbers. The Corporation
will promptly notify the Trustee of any change in the CUSIP numbers.

                                  ARTICLE III.
                            REDEMPTION OF DEBENTURES

SECTION 3.1       REDEMPTION.

         Subject to the Corporation having received prior regulatory approval,
if then required under applicable capital guidelines or regulatory policies,
the Corporation may redeem the Debentures issued hereunder on and after the
dates set forth in and in accordance with the terms of this Article III.

SECTION 3.2       SPECIAL EVENT REDEMPTION.

         Subject to the Corporation having received prior regulatory approval,
if then required under applicable capital guidelines or regulatory policies, if
a Special Event, as defined in Section 1.1 hereof, has occurred and is
continuing, then, notwithstanding Section 3.3(a), but subject to Section
3.3(b), the Corporation shall have the right upon not less than 30 days nor
more than 60 days notice to the holders of the Debentures to redeem the
Debentures, in whole but

                                    Page 19
<PAGE>

not in part, for cash within 90 days following the occurrence of such Special
Event (the "90-Day Period") at a redemption price equal to 100% of the
principal amount to be redeemed plus any accrued and unpaid interest thereon to
the date of such redemption (the "Redemption Price"), provided that if such
Special Event is a Tax Event and at the time there is available to the
Corporation the opportunity to eliminate, within the 90-Day Period, such Tax
Event by taking some ministerial action (a "Ministerial Action"), such as
filing a form or making an election, or pursuing some other similar reasonable
measure which has no adverse effect on the Corporation, the Trust or the
holders of the Trust Securities, the Corporation shall pursue such Ministerial
Action in lieu of redemption, and, provided further, that the Corporation shall
have no right to redeem the Debentures while the Trust is pursuing any
Ministerial Action pursuant to its obligations under the Trust Agreement. The
Redemption Price shall be paid prior to 12:00 noon, New York, New York time, on
the date of such redemption or such earlier time as the Corporation determines,
provided that the Corporation shall deposit with the Trustee an amount
sufficient to pay the Redemption Price by 10:00 a.m., New York, New York time,
on the date such Redemption Price is to be paid.

SECTION 3.3       OPTIONAL REDEMPTION BY CORPORATION.

         (a)      Subject to the provisions of Section 3.3(c), except as
otherwise may be specified in this Indenture, the Company shall have the right
to redeem the Debentures, in whole or in part, from time to time, (i) on or
after April 1, 2007, at a Redemption Price equal to 100% of the principal
amount to be redeemed plus any accrued and unpaid interest thereon to the date
of such redemption; and (ii) before April 1, 2007, at a Redemption Price equal
to 100% of the principal amount to be redeemed plus any accrued and unpaid
interest thereon to the date of such redemption. The Company may elect to
redeem the Debentures pursuant to (ii) above only if the stock price for the
Company's common stock has been at least 125% of the Conversion Price for a
period of twenty consecutive business days ending within five days of the date
of notice of redemption. Any redemption pursuant to this Section 3.3(a) shall
be made upon not less than 30 days' nor more than 60 days' notice to the holder
of the Debentures, at the Redemption Price. If the Debentures are only
partially redeemed pursuant to this Section 3.3(a), the Debentures shall be
redeemed pro rata or by lot or in such other manner as the Trustee shall deem
appropriate and fair in its discretion. The Redemption Price shall be paid
prior to 12:00 noon, New York, New York time, on the date of such redemption or
at such earlier time as the Company determines provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Redemption Price by
10:00 a.m., New York, New York time, on the date such Redemption Price is to be
paid.

         (b)      Subject to the provisions of Section 3.3(c), the Corporation
shall have the right to redeem Debentures at any time and from time to time in
a principal amount equal to the Liquidation Amount (as defined in the Trust
Agreement) of any Preferred Securities purchased and beneficially owned by the
Corporation, plus an additional principal amount of Debentures equal to the
Liquidation Amount (as defined in the Trust Agreement) of that number of Common
Securities that bears the same proportion to the total number of Common
Securities then outstanding as the number of Preferred Securities to be
redeemed bears to the total number of Preferred Securities then outstanding.
Such Debentures shall be redeemed pursuant to this Section 3.3(b) only in
exchange for and upon surrender by the Corporation to the Property Trustee of
the Preferred Securities and a proportionate amount of Common Securities,
whereupon the Property Trustee shall cancel the Preferred Securities and Common
Securities so surrendered and a Like Amount (as defined in the Trust Agreement)
of Debentures shall be extinguished by the Trustee and shall no longer be
deemed Outstanding.

         (c)      If a partial redemption of the Debentures would result in the
delisting of the Preferred Securities issued by the Trust from The Nasdaq
National Market or any national securities exchange or other organization on
which the Preferred Securities are then listed or quoted, the Corporation shall
not be permitted to effect such partial redemption and may only redeem the
Debentures in whole.

SECTION 3.4       NOTICE OF REDEMPTION.

         (a)      Except in the case of redemption pursuant to Section 3.3(b),
in case the Corporation shall desire to exercise such right to redeem all or a
portion of the Debentures in accordance with the right reserved so to do, the
Corporation shall, or shall cause the Trustee to, upon receipt of 45 days
written notice from the Corporation (which notice shall, in the event of a
partial redemption, include a representation to the effect that such partial
redemption will not result in the delisting of the Preferred Securities as
described in Section 3.3(c) above), give notice of such redemption to holders
of the Debentures to be redeemed by mailing, first class postage prepaid, a
notice of such

                                    Page 20
<PAGE>

redemption not less than 30 days and not more than 60 days before the date
fixed for redemption to such holders at their last addresses as they shall
appear upon the Debenture Register unless a shorter period is specified in the
Debentures to be redeemed. Any notice that is mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the registered holder receives the notice. In any case, failure to duly give
such notice to the holder of any Debenture designated for redemption in whole
or in part, or any defect in the notice, shall not affect the validity of the
proceedings for the redemption of any other Debentures. In the case of any
redemption of Debentures prior to the expiration of any restriction on such
redemption provided in the terms of such Debentures or elsewhere in this
Indenture, the Corporation shall furnish the Trustee with an Officers'
Certificate evidencing compliance with any such restriction. Each such notice
of redemption shall identify the Debenture to be redeemed (including CUSIP
numbers, if any) and shall specify the date fixed for redemption and the
Redemption Price and shall state that payment of the Redemption Price shall be
made at the office or agency of the Corporation or at the Corporate Trust
Office, upon presentation and surrender of such Debentures, that interest
accrued to the date fixed for redemption shall be paid as specified in said
notice and that from and after said date interest shall cease to accrue. If
less than all the Debentures are to be redeemed, the notice to the holders of
the Debentures shall specify the particular Debentures to be redeemed. If any
Debenture is to be redeemed in part only, the notice shall state the portion of
the principal amount thereof to be redeemed (which shall be $10 or a multiple
thereof) and shall state that on and after the redemption date, upon surrender
of such Debenture, a new Debenture or Debentures in principal amount equal to
the unredeemed portion thereof shall be issued.

         (b)      Except in the case of redemption pursuant to Section 3.3(b),
if less than all the Debentures are to be redeemed, the Corporation shall give
the Trustee at least 45 days notice in advance of the date fixed for redemption
as to the aggregate principal amount of Debentures to be redeemed, and
thereupon the Trustee shall select, in such manner as it shall deem appropriate
and fair in its discretion, the portion or portions of the Debentures to be
redeemed and shall thereafter promptly notify the Corporation in writing of the
numbers of the Debentures to be redeemed, in whole or in part. The Corporation
may, if and whenever it shall so elect pursuant to the terms hereof, by
delivery of instructions signed on its behalf by its Chairman, President or any
Vice President, instruct the Trustee or any paying agent to call all or any
part of the Debentures for redemption and to give notice of redemption in the
manner set forth in this Section 3.4, such notice to be in the name of the
Corporation or its own name as the Trustee or such paying agent may deem
advisable. In any case in which notice of redemption is to be given by the
Trustee or any such paying agent, the Corporation shall deliver or cause to be
delivered to, or permit to remain with, the Trustee or such paying agent, as
the case may be, such Debenture Register, transfer books or other records, or
suitable copies or extracts therefrom, sufficient to enable the Trustee or such
paying agent to give any notice by mail that may be required under the
provisions of this Section 3.4.

SECTION 3.5       PAYMENT UPON REDEMPTION.

         (a)      If the giving of notice of redemption shall have been
completed as above provided, subject to the provisions of Section 3.2 the
Debentures or portions of Debentures to be redeemed specified in such notice
shall become due and payable on the date and at the place stated in such notice
at the applicable Redemption Price, and interest on such Debentures or portions
of Debentures shall cease to accrue on and after the date fixed for redemption,
unless the Corporation shall default in the payment of such Redemption Price
with respect to any such Debenture or portion thereof. On presentation and
surrender of such Debentures on or after the date fixed for redemption at the
place of payment specified in the notice, said Debentures shall be paid and
redeemed at the Redemption Price (but if the date fixed for redemption is an
Interest Payment Date, the interest installment payable on such date shall not
be part of the Redemption Price and shall be payable instead to the registered
holder at 5:00 p.m., New York, New York time on the Regular Record Date next
preceding the next succeeding Interest Payment Date).

         (b)      Subject to the provisions of Article II, upon presentation of
any Debenture that is to be redeemed in part only, the Corporation shall
execute and the Trustee shall authenticate and the office or agency where the
Debenture is presented shall make available for delivery to the holder thereof,
at the expense of the Corporation, a new Debenture of authorized denomination
in principal amount equal to the unredeemed portion of the Debenture so
presented.

                                    Page 21
<PAGE>

SECTION 3.6       NO SINKING FUND.

         The Debentures are not entitled to the benefit of any sinking fund.

                                   ARTICLE IV
                            CONVERSION OF DEBENTURES

SECTION 4.1       CONVERSION RIGHTS.

         Subject to and upon compliance with the provisions of this Article IV,
the Debentures are convertible, at the option of the Debentureholder, at any
time after February 13, 2002, and on or before 5:00 pm, New York, New York
time, on the Business Day immediately preceding the date of repayment of such
Debentures, whether at maturity or upon redemption, into fully paid and
nonassessable shares of Common Stock at an initial conversion ratio of 1.153
shares of Common Stock for each $10 in aggregate principal amount of Debentures
(equal to an initial conversion price of $8.67 per share of Common Stock),
subject to adjustment as described in this Article IV (the "Conversion Ratio").
A Debentureholder may convert any portion of the principal amount of the
Debentures into that number of fully paid and nonassessable shares of Common
Stock calculated as to each conversion to the nearest 1/100th of a share)
obtained by multiplying (x) the quotient obtained by dividing the principal
amount of the Debentures to be converted by $10 by (y) the Conversion Ratio. In
case a Debenture or portion thereof is called for redemption, such conversion
right in respect of the Debenture or portion so called shall expire at 5:00
p.m., New York, New York time on the Business Day immediately preceding the
corresponding Maturity Date, unless the Corporation defaults in making the
payment due upon redemption.

SECTION 4.2       CONVERSION PROCEDURES.

         (a)      To convert all or a portion of the Debentures, the
Debentureholder thereof shall deliver to the Conversion Agent an irrevocable
Conversion Request setting forth the principal amount of Debentures to be
converted, together with the name or names, if other than the Debentureholder,
in which the shares of Common Stock should be issued upon conversion and, if
such Debentures are in certificate form, surrender to the Conversion Agent the
Debentures to be converted, duly endorsed or assigned to the Corporation or in
blank. In addition, a holder of Preferred Securities may exercise its right
under the Trust Agreement to exchange such Preferred Securities for Debentures
which shall be converted into Common Stock by delivering to the Conversion
Agent an irrevocable Conversion Request setting forth the information called
for by the preceding sentence and directing the Conversion Agent (i) to
exchange such Preferred Security for a portion of the Debentures held by the
Trust (at an exchange rate of $10 principal amount of Debentures for each
Preferred Security), and (ii) to immediately convert such Debentures, on behalf
of such Debentureholder, into Common Stock pursuant to this Article IV and, if
such Preferred Securities are in certificate form, surrendering such Preferred
Securities, duly endorsed or assigned to the Corporation or in blank. So long
as any Preferred Securities are outstanding, the Trust shall not convert any
Debentures into shares of Common Stock except pursuant to a Conversion Request
delivered to the Conversion Agent by a holder of Preferred Securities.

         If a Conversion Request is delivered on or after the Regular Record
Date and prior to the subsequent Interest Payment Date, the Debentureholder
shall be required to pay to the Corporation the interest payable to the
Debentureholder on the subsequent Interest Payment Date prior to distribution
of the shares of Common Stock, and such Debentureholder shall be entitled to
receive the interest payable on the subsequent Interest Payment Date, on the
portion of Debentures to be converted, notwithstanding the conversion thereof
prior to such Interest Payment Date. Except as provided in the immediately
preceding sentence, the Corporation shall not make, or be required to make, any
payment, allowance or adjustment for accumulated and unpaid interest, whether
or not in arrears, on converted Debentures; provided, however, that if notice
of redemption of Debentures is mailed or otherwise given to Debentureholders,
then, if any Debentureholder converts any Debentures into Common Stock on any
date on or after the date on which such notice of prepayment is mailed or
otherwise given, and if such date of conversion falls on any day from and
including the first day of an Extended Interest Payment Period and on or prior
to the Interest Payment Date upon which such Extended Interest Payment Period
ends, such converting Debentureholder shall be entitled to receive either (i)
if the date of such conversion falls after a Regular Record Date and on or
prior to the next succeeding Interest Payment Date, all accrued and unpaid
interest on such Debentures (including interest thereon, if any, to the extent
permitted by applicable law) to such Interest Payment Date, or (ii) if the date
of such

                                    Page 22
<PAGE>

conversion does not fall on a date described in clause (i) above, all accrued
and unpaid interest on such Debentures (including interest thereon, if any, to
the extent permitted by applicable law) to the most recent Interest Payment
Date prior to the date of such conversion, which interest shall, in either such
case, be paid to such converting Debentureholder unless the date of conversion
of such Debentures is on or prior to the Interest Payment Date upon which such
Extended Interest Payment Period ends and after the Regular Record Date for
such Interest Payment Date, in which case such interest shall be paid to the
person who was the Debentureholder at 5:00 p.m., New York, New York time on
such Regular Record Date. Except as otherwise set forth above in this
paragraph, in the case of any Debenture which is converted, interest which is
payable after the date of conversion of such Debenture shall not be payable,
and the Corporation shall not make nor be required to make any other payment,
adjustment or allowance with respect to accrued but unpaid interest on the
Debentures being converted, which shall be deemed to be paid in full. If any
Debenture called for redemption is converted, any money deposited with the
Trustee or with any paying agent or so segregated and held in trust for the
redemption of such Debenture shall (subject to any right of the
Debentureholder) be paid to the Corporation upon Corporation Request or, if
then held by the Corporation, shall be discharged from such trust.

         Each conversion shall be deemed to have been effected immediately
prior to close of business on the day on which the Conversion Request was
received (the "Conversion Date") by the Conversion Agent from the
Debentureholder or from a holder of the Preferred Securities effecting a
conversion thereof pursuant to its conversion rights under the Trust Agreement,
as the case may be. The Person or Persons entitled to receive the Common Stock
issuable upon such conversion shall be treated for all purposes as a record
holder or holders of such Common Stock as of the Conversion Date. As promptly
as practicable on or after the Conversion Date, the Corporation shall issue and
deliver at the office of the Conversion Agent, unless otherwise directed by the
Debentureholder in the Conversion Request, a certificate or certificates for
the number of full shares of Common Stock issuable upon such conversion,
together with the cash payment, if any, in lieu of any fraction of any share to
the Person or Persons entitled to receive the same. The Conversion Agent shall
deliver such certificate or certificates to each Person or Persons.

         (b)      Subject to any right of the Debentureholder, the
Corporation's delivery upon conversion of the fixed number of shares of Common
Stock into which the Debentures are convertible (together with the cash
payment, if any, in lieu of fractional shares) shall be deemed to satisfy the
Corporation's obligation to pay the principal amount at maturity of the portion
of Debentures so converted and any unpaid interest accrued on such Debentures
at the time of such conversion.

         (c)      No fractional shares of Common Stock shall be issued as a
result of conversion, but in lieu thereof, the Corporation shall pay to the
Conversion Agent a cash adjustment in an amount equal to the same fraction of
the last reported sale price of such fractional interest on the date on which
the Debentures or Preferred Securities, as the case may be, were duly
surrendered to the Conversion Agent for conversion, or, if such day is not a
Trading Day, on the next Trading Day, and the Conversion Agent in turn shall
make such payment, if any, to the Debentureholder or the holder of the
Preferred Securities so converted.

         (d)      In the event of the conversion of any Debenture in part only,
a new Debenture or Debentures for the unconverted portion thereof shall be
issued in the name of the Debentureholder thereof upon the cancellation thereof
in accordance with Section 2.9.

         (e)      In effecting the conversion transactions described in this
Section 4.2, the Conversion Agent is acting as agent of the holders of
Preferred Securities (in the exchange of Preferred Securities for Debentures)
and as agent of the Debentureholders (in the conversion of Debentures into
Common Stock), as the case may be, directing it to effect such conversion
transactions. The Conversion Agent is hereby authorized (i) to exchange
Preferred Securities for Debentures held by the Trust from time to time in
connection with the conversion of such Preferred Securities in accordance with
this Article IV, and (ii) to convert all or a portion of the Debentures into
Common Stock and thereupon to deliver such shares of Common Stock in accordance
with the provisions of this Article IV and to deliver to the Trust a new
Debenture or Debentures for any resulting unconverted principal amount.

                                    Page 23
<PAGE>

SECTION 4.3       CONVERSION RATIO ADJUSTMENTS.

         The Conversion Ratio shall be subject to adjustment (without
duplication) from time to time as follows:

         (a)      In case the Corporation shall, while any of the Debentures
are outstanding, (i) pay a dividend or make a distribution with respect to its
Common Stock in shares of Common Stock, (ii) subdivide its outstanding shares
of Common Stock, (iii) combine its outstanding shares of Common Stock into a
smaller number of shares, or (iv) issue by reclassification of its shares of
Common Stock any shares of capital stock of the Corporation, then the
Conversion Ratio in effect immediately prior to such action shall be adjusted
so that the holders of any Debentures thereafter surrendered for conversion
shall be entitled to receive the number of shares of capital stock of the
Corporation which he would have owned immediately following such action had
such Debentures been converted immediately prior thereto. An adjustment made
pursuant to this section 4.3(a) shall become effective immediately after the
record date in the case of a dividend or other distribution and shall become
effective immediately after the effective date in case of a subdivision,
combination or reclassification (or immediately after the record date if a
record date shall have been established for such event). If, as a result of an
adjustment made pursuant to this Section 4.3(a), the holder of any Debenture
thereafter surrendered for conversion shall become entitled to receive shares
of two or more classes or series of capital stock of the Corporation, the Board
of Directors (whose determination shall be conclusive and shall be described in
a Board Resolution filed with the Trustee) shall determine the allocation of
the adjusted Conversion Ratio between or among shares of such classes or series
of capital stock.

         (b)      In case the Corporation shall, while any of the Debentures
are outstanding, issue rights or warrants to all holders of its Common Stock
entitling them (for a period expiring within 45 days after the record date
mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common
Stock at a price per share less than the Current Market Price (as defined
below) per share of Common Stock on such record date, then the Conversion Ratio
for the Debentures shall be adjusted so that the same shall equal the ratio
determined by multiplying the Conversion Ratio in effect immediately prior to
the date of issuance of such rights or warrants by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding on the date
of issuance of such rights or warrants plus the number of additional shares of
Common Stock offered for subscription or purchase, and of which the denominator
shall be the number of shares of Common Stock outstanding on the date of
issuance of such rights or warrants plus the number of shares which the
aggregate offering price of the total number of shares so offered for
subscription or purchase would purchase at such Current Market Price. Such
adjustment shall become effective immediately after the record date for the
determination of shareholders entitled to receive such rights or warrants. For
the purposes of this Section 4.3(b), the number of shares of Common Stock at
any time outstanding shall not include shares held in the treasury of the
Corporation. The Corporation shall not issue any rights or warrants in respect
of the shares of Common Stock held in the treasury of the Corporation. In case
any rights or warrants referred to in this Section 4.3(b) in respect of which
an adjustment shall have been made shall expire unexercised within 45 days
after the same shall have been distributed or issued by the Corporation, the
Conversion Ratio shall be readjusted at the time of such expiration to the
Conversion Ratio that would have been in effect if no adjustment had been made
on account of the distribution or issuance of such expired rights or warrants.

         (c)      Subject to the last sentence of this Section 4.3(c), in case
the Corporation shall, by dividend or otherwise, distribute to all holders of
its Common Stock evidences of its indebtedness, shares of any class or series
of capital stock, cash or assets (including securities, but excluding any
rights or warrants referred to in Section 4.3(b), any dividend or distribution
paid exclusively in cash and any dividend or distribution referred to in
Section 4.3(a)), then the Conversion Ratio shall be increased so that the same
shall equal the ratio determined by multiplying the Conversion Ratio in effect
immediately prior to the effectiveness of the Conversion Ratio increase
contemplated by this Section 4.3(c) by a fraction of which the numerator shall
be the Current Market Price per share of Common Stock on the date fixed for the
payment of such distribution (the "Reference Date"), and of which the
denominator shall be, the Current Market Price per share of the Common Stock on
the Reference Date less the fair market value (as determined in good faith by
the Board of Directors, whose determination shall be conclusive and described
in a Board Resolution), on the Reference Date, of the portion of the evidences
of indebtedness, shares of capital stock, cash and assets so distributed
applicable to one share of Common Stock, such increase to become effective
immediately prior to the opening of business on the day following the Reference
Date. In the event that such dividend or distribution is not so paid or made,
the Conversion Ratio shall again be adjusted to be the Conversion Ratio which
would then be in effect if such dividend or distribution had not occurred. If
the Board of Directors determines the fair market value of any distribution for
purposes of this Section 4.3(c) by reference to the actual or when issued
trading market for any securities comprising such distribution, it must in
doing so consider the prices in such market over the same period used in
computing the Current Market Price per share of Common Stock. For purposes of
this Section 4.3(c), any dividend or distribution that includes shares of
Common Stock or rights or

                                    Page 24
<PAGE>

warrants to subscribe for or purchase shares of Common Stock shall be deemed
instead to be (1) a dividend or distribution of the evidences of indebtedness,
shares of capital stock, cash or assets other than such shares of Common Stock
or such rights or warrants (making any Conversion Ratio increase required by
this Section 4.3(c)) immediately followed by (2) a dividend or distribution of
such shares of Common Stock or such rights or warrants (making any further
Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A)
the Reference Date of such dividend or distribution as defined in this Section
4.3(c) shall be substituted as (a) "the record date in the case of a dividend
or other distribution," and (b) "the record date for the determination of
shareholders entitled to receive such rights or warrants," and (c) "the date
fixed for such determination" within the meaning of Sections 4.3(a) and 4.3(b),
and (B) any shares of Common Stock included in such dividend or distribution
shall not be deemed outstanding for purposes of computing any adjustment of the
Conversion Ratio in Section 4.3(a).

         (d)      In case the Corporation shall pay or make a dividend or other
distribution on its Common Stock exclusively in cash (excluding all cash
dividends paid out of the retained earnings of the Corporation), then the
Conversion Ratio shall be increased so that the same shall equal the ratio
determined by multiplying the Conversion Ratio in effect immediately prior to
the effectiveness of the Conversion Ratio increase contemplated by this Section
4.3(d) by a fraction of which the numerator shall be the Current Market Price
per share of the Common Stock, and of which the denominator shall be the
Current Market Price per share of Common Stock on the date fixed for the
payment of such distribution less the amount of cash so distributed and not
excluded as provided applicable to one share of Common Stock on the date fixed
for the payment of such distribution, such increase to become effective
immediately prior to the opening of business on the day following the date
fixed for the payment of such distribution; provided, however, that in the
event the portion of the cash so distributed applicable to one share of Common
Stock is equal to or greater than the Current Market Price per share of the
Common Stock on the record date mentioned above, in lieu of the foregoing
adjustment, adequate provision shall be made so that each Debentureholder shall
have the right to receive upon conversion the amount of cash such
Debentureholder would have received had such Debentureholder converted each
Debenture immediately prior to the record date for the distribution of the
cash. In the event that such dividend or distribution is not so paid or made,
the Conversion Ratio shall again be adjusted to be the Conversion Ratio which
would then be in effect if such record date had not been fixed.

         (e)      In case a tender or exchange offer (other than an odd-lot
offer) made by the Corporation or any subsidiary of the Corporation for all or
any portion of the Common Stock shall expire and such tender or exchange offer
shall involve the payment by the Corporation or such subsidiary of
consideration per share of Common Stock having a fair market value (as
determined in good faith by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) at the last time (the
"Expiration Time") tenders or exchanges may be made pursuant to such tender or
exchange offer (as it shall have been amended) that exceeds 110% of the Current
Market Price per share of Common Stock on the Trading Day next succeeding the
Expiration Time, then the Conversion Ratio shall be increased so that the same
shall equal the ratio determined by multiplying the Conversion Ratio in effect
immediately prior to the effectiveness of the Conversion Ratio increase
contemplated by this Section 4.3(e) by a fraction of which the numerator shall
be the sum of (x) the fair market value (determined as aforesaid) of the
aggregate consideration payable to shareholders based on the acceptance (up to
any maximum specified in the terms of the tender or exchange offer) of all
shares validly tendered or exchanged and not withdrawn as of the Expiration
Time (the shares deemed so accepted, up to any such maximum, being referred to
as the "Purchased Shares"), and (y) the product of the number of shares of
Common Stock outstanding (less any Purchased Shares) at the Expiration Time and
the Current Market Price per share of Common Stock on the Trading Day next
succeeding the Expiration Time, and of which the denominator shall be the
number of shares of Common Stock outstanding (including any tendered or
exchanged shares) at the Expiration Time multiplied by the Current Market Price
per share of Common Stock on the Trading Day next succeeding the Expiration
Time, such increase to become effective immediately prior to the opening of
business on the day following the Expiration Time.

         (f)      For the purpose of any computation under Sections 4.3(b),
(c), (d) or (e), the "Current Market Price" per share of Common Stock on any
date in question shall be deemed to be the average of the daily Closing Prices
for the ten consecutive Trading Days selected by the Corporation commencing not
more than 20 Trading Days before, and ending not later than the earlier of the
day in question or, if applicable, the day before the "ex" date with respect to
the issuance or distribution requiring such computation; provided, however,
that if another event occurs that would require an adjustment pursuant to
Sections 4.3(a) through (e), inclusive, the Board of Directors may make such
adjustments to the Closing Prices during such five Trading Day period as it
deems appropriate to

                                    Page 25
<PAGE>

effectuate the intent of the adjustments in this Section 4.3, in which case any
such determination by the Board of Directors shall be set forth in a Board
Resolution and shall be conclusive. For purposes of this Section 4.3(f), the
term "ex" date, (i) when used with respect to any issuance or distribution,
means the first date on which the Common Stock trades in a regular way on The
Nasdaq National Market(s) or on such successor securities quotation system as
the Common Stock may be listed or in the relevant market from which the Closing
Prices were obtained without the right to receive such issuance or
distribution, and (ii) when used with respect to any tender or exchange offer,
means the first date on which the Common Stock trades in a regular way on such
securities exchange or in such market after the Expiration Time of such offer.

         (g)      The Corporation may make such increases in the Conversion
Ratio, in addition to those required by Sections (a) through (e), as it
considers to be advisable to avoid or diminish any income tax to holders of
Common Stock or rights to purchase Common Stock resulting from any dividend or
distribution of stock (or rights to acquire stock) or from any event treated as
such for income tax purposes. The Corporation from time to time may increase
the Conversion Ratio by any amount for any period of time if the period is at
least 20 days, the increase is irrevocable during the period, and the Board of
Directors shall have made a determination that such increase would be in the
best interest of the Corporation, which determination shall be conclusive.
Whenever the Conversion Ratio is increased pursuant to the preceding sentence,
the Corporation shall mail to Debentureholders of record a notice of the
increase at least fifteen days prior to the date the increased Conversion Ratio
takes effect, and such notice shall state the increased Conversion Ratio and
the period it shall be in effect.

         (h)      No adjustment in the Conversion Ratio shall be required
unless such adjustment would require an increase or decrease of at least 1% in
the Conversion Ratio; provided, however, that any adjustments which by reason
of this Section 4.3(h) are not required to be made shall be carried forward and
taken into account in determining whether any subsequent adjustment shall be
required. The adjusted Conversion Ratio will be rounded to four decimal places.

         (i)      If any action would require adjustment of the Conversion
Ratio pursuant to more than one of the provisions described above, only one
adjustment shall be made and such adjustment shall be the amount of adjustment
that has the highest absolute value to the Debentureholders.

SECTION 4.4       RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE OF ASSETS.

         In the event that the Corporation shall be a party to any transaction,
including without limitation (a) any recapitalization or reclassification of
the Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination of the Common Stock), (b) any consolidation of the Corporation
with, or merger of the Corporation into any other Person, any merger of another
Person into the Corporation (other than a merger which does not result in a
reclassification, conversion, exchange or cancellation of outstanding shares of
Common Stock of the Corporation), (c) any sale, transfer or lease of all or
substantially all of the assets of the Corporation, or (d) any compulsory share
exchange, in each case pursuant to which the Common Stock is converted into the
right to receive other securities, cash or other property, then lawful
provision shall be made as part of the terms of such transaction whereby the
holder of each Debenture then outstanding shall have the right thereafter to
convert each Debenture only into the kind and amount of securities, cash or
other property receivable upon consummation of such transaction by a holder of
the number of shares of Common Stock of the Corporation into which such
Debenture could have been converted immediately prior to such transaction.

         The Corporation or the Person formed by such consolidation or
resulting from such merger or which acquired such assets or which acquires the
shares of the Corporation, as the case may be, shall make provision in its
certificate or articles of incorporation or other constituent document to
establish such right. Such certificate or articles of incorporation or other
constituent document shall provide for adjustments which, for events subsequent
to the effective date of such certificate or articles of incorporation or other
constitution document, shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Article IV. The above provisions shall
similarly apply to successive transactions of the foregoing type.

                                    Page 26
<PAGE>

SECTION 4.5       NOTICE OF ADJUSTMENTS OF CONVERSION RATIO.

         Whenever the Conversion Ratio is adjusted as herein provided:

         (a)      The Corporation shall compute the adjusted Conversion Ratio
and shall prepare a certificate signed by the Chairman of the Board, President
or a Vice President of the Corporation and by its Treasurer or an Assistant
Treasurer of the Corporation setting forth the adjusted Conversion Ratio and
showing in reasonable detail the facts upon which such adjustment is based, and
such certificate shall forthwith be filed with the Trustee, the Conversion
Agent and the transfer agent for the Preferred Securities and the Debentures;
and

         (b)      A notice stating that the Conversion Ratio has been adjusted
and setting forth the adjusted Conversion Ratio shall as soon as practicable be
mailed by the Corporation to all record holders of Preferred Securities and the
Debentures at their last addresses as they appear upon the stock transfer books
of the Corporation and the Trust.

SECTION 4.6       PRIOR NOTICE OF CERTAIN EVENTS.

         In case:

         (a)      the Corporation shall (i) declare any dividend (or any other
distribution) on its Common Stock, other than (A) a dividend payable in shares
of Common Stock, or (B) a dividend payable in cash that would not require an
adjustment pursuant to Section 4.3(c) or (d), or (ii) authorize a tender or
exchange offer that would require an adjustment pursuant to Section 4.3(e);

         (b)      the Corporation shall authorize the granting to all holders
of Common Stock of rights or warrants to subscribe for or purchase any shares
of stock of any class or series or of any other rights or warrants;

         (c)      of any reclassification of Common Stock (other than a
subdivision or combination of the outstanding Common Stock, or a change in par
value, or from par value to no par value, or from no par value to par value),
or of any consolidation or merger to which the Corporation is a party and for
which approval of any shareholders of the Corporation shall be required, or the
sale or transfer of all or substantially all of the assets of the Corporation
or of any compulsory share exchange whereby the Common Stock is converted into
other securities, cash or other property; or

         (d)      of the voluntary or involuntary dissolution, liquidation or
winding up of the Corporation, then the Corporation shall (1) if any Preferred
Securities are outstanding, cause to be filed with the transfer agent for the
Preferred Securities, and shall cause to be mailed to the holders of record of
the Preferred Securities, at their last addresses as they shall appear upon the
securities register of the Trust, or (2) shall cause to be mailed to all
Debentureholders at their last addresses as they shall appear in the Debenture
Register, at least fifteen days prior to the applicable record or effective
date hereinafter specified, a notice stating (x) the date on which a record (if
any) is to be taken for the purpose of such dividend, distribution, rights or
warrants or, if a record is not to be taken, the date as of which the holders
of Common Stock of record to be entitled to such dividend, distribution, rights
or warrants are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, transfer, share exchange,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their shares of Common Stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer, share exchange, dissolution, liquidation or winding up (but no
failure to mail such notice or any defect therein or in the mailing thereof
shall affect the validity of the corporate action required to be specified in
such notice).

SECTION 4.7       CERTAIN DEFINED TERMS.

         The following definitions shall apply to terms used in this Article
IV:

         (a)      "Closing Prices" of any security on any day shall mean the
last reported sale price for such security, regular way, on such day or, if no
sale takes place on such day, the average of the reported closing bid and asked
prices on such day, regular way, of such security, in either case as reported
on the National Market System of the

                                    Page 27
<PAGE>

National Association of Securities Dealers, Inc. or, if such security is not
quoted or admitted to trading on such quotation system, on the principal
quotation system on which such security is listed or admitted to trading or
quoted, or, if not listed or admitted to trading or quoted on any national
securities exchange or quotation system, the average of the closing bid and
asked prices of such security in the over-the-counter market on the day in
question as reported by the National Quotation Bureau Incorporated, or a
similar generally accepted reporting service, or, if not so available in such
manner, as furnished by any Nasdaq member firm selected from time to time by
the Board of Directors for that purpose or, if not so available in such manner,
as otherwise determined in good faith by the Board of Directors.

         (b)      "Trading Day" shall mean a day on which securities are traded
on the national securities exchange or quotation system used to determine the
Closing Price.

SECTION 4.8       DIVIDEND OR INTEREST REINVESTMENT PLANS.

         Notwithstanding the foregoing provisions, the issuance of any shares
of Common Stock pursuant to any plan providing for the reinvestment of
dividends or interest payable on securities of the Corporation and the
investment of additional optional amounts in shares of Common Stock under any
such plan, and the issuance of any shares of Common Stock or options or rights
to purchase such shares pursuant to any employee benefit plan or program of the
Corporation or pursuant to any option, warrant, right or exercisable,
exchangeable or convertible security outstanding as of the date the Debentures
were first issued, shall not be deemed to constitute an issuance of Common
Stock or exercisable, exchangeable or convertible securities by the Corporation
to which any of the adjustment provisions described above shall apply. There
also shall be no adjustment of the Conversion Ratio in case of the issuance of
any stock (or securities convertible into or exchangeable for stock) of the
Corporation except as specifically described in this Article IV.

SECTION 4.9       CERTAIN ADDITIONAL RIGHTS.

         In case the Corporation shall, by dividend or otherwise, declare or
make a distribution on its Common Stock referred to in Section 4.3(c) or (d)
(including, without limitation, dividends or distributions referred to in the
last sentence of Section 4.3(c)), then the Debentureholders, upon the
conversion thereof subsequent to 5:00 p.m., New York, New York time on the date
fixed for the determination of shareholders entitled to receive such
distribution and prior to the effectiveness of the Conversion Ratio adjustment
in respect of such distribution, also shall be entitled to receive for each
share of Common Stock into which the Debentures are converted, the portion of
the shares of Common Stock, rights, warrants, evidences of indebtedness, shares
of capital stock, cash and assets so distributed applicable to one share of
Common Stock; provided, however, that, at the election of the Corporation
(whose election shall be evidenced by a Board Resolution) with respect to all
Debentureholders so converting, the Corporation may, in lieu of distributing to
such Debentureholder any portion of such distribution not consisting of cash or
securities of the Corporation, pay such Debentureholder an amount in cash equal
to the fair market value thereof (as determined in good faith by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution). If any conversion of Debentures described in the immediately
preceding sentence occurs prior to the payment date for a distribution to
holders of Common Stock which the Debentureholders so converted is entitled to
receive in accordance with the immediately preceding sentence, the Corporation
may elect (such election to be evidenced by a Board Resolution) to distribute
to such Debentureholder a due bill for the shares of Common Stock, rights,
warrants, evidences of indebtedness, shares of capital stock, cash or assets to
which such Debentureholder is so entitled, provided, that such due bill (i)
meets any applicable requirements of the principal national securities
quotation system or other market on which the Common Stock is then traded, and
(ii) requires payment or delivery of such shares of Common Stock, rights,
warrants, evidences of indebtedness, shares of capital stock, cash or assets no
later than the date of payment or delivery thereof to holders of shares of
Common Stock receiving such distribution.

SECTION 4.10      TRUSTEE NOT RESPONSIBLE FOR DETERMINING CONVERSION RATIO OR
ADJUSTMENTS.

         Neither the Trustee nor any Conversion Agent shall at any time be
under any duty or responsibility to any Debentureholder to determine whether
any facts exist which may require any adjustment of the Conversion Ratio, or
with respect to the nature or extent of any such adjustment when made, or with
respect to the method employed, or

                                    Page 28
<PAGE>

herein or in any supplemental indenture provided to be employed, in making the
same. Neither the Trustee nor any Conversion Agent shall be accountable with
respect to the validity or value (or the kind of account) of any shares of
Common Stock or of any securities or property, which may at any time be issued
or delivered upon the conversion of any Debenture; and neither the Trustee nor
any Conversion Agent makes any representation with respect thereto. Neither the
Trustee nor any Conversion Agent shall be responsible for any failure of the
Corporation to make any cash payment or to issue, transfer or deliver any
shares of Common Stock or stock certificates or other securities or property
upon the surrender of any Debenture for the purpose of conversion, or, except
as expressly herein provided, to comply with any of the covenants of the
Corporation contained in Article VI or this Article IV.

                                   ARTICLE V.
                      EXTENSION OF INTEREST PAYMENT PERIOD

SECTION 5.1       EXTENSION OF INTEREST PAYMENT PERIOD.

         So long as no Event of Default has occurred and is continuing, the
Corporation shall have the right, at any time and from time to time during the
term of the Debentures, to defer payments of interest by extending the interest
payment period of such Debentures for a period not exceeding 20 consecutive
quarters (the "Extended Interest Payment Period"), during which Extended
Interest Payment Period no interest shall be due and payable; provided that no
Extended Interest Payment Period may extend beyond the Maturity Date. To the
extent permitted by applicable law, interest, which has been deferred because
of the extension of the interest payment period pursuant to this Section 5.1,
shall bear interest thereon at the Coupon Rate, compounded quarterly during the
Extended Interest Payment Period (the "Compounded Interest"). At the end of the
Extended Interest Payment Period, the Corporation shall calculate (and deliver
such calculation to the Trustee) and pay all interest accrued and unpaid on the
Debentures, including any Additional Interest and Compounded Interest in
respect of such period (together, "Deferred Interest") that shall be payable to
the holders of the Debentures in whose names the Debentures are registered in
the Debenture Register as of 5:00 p.m., New York, New York time on the Regular
Record Date immediately preceding the end of the Extended Interest Payment
Period. Before the termination of any Extended Interest Payment Period, subject
to the foregoing requirements, the Corporation may further extend such period,
provided that such period together with all such further extensions thereof
shall not exceed 20 consecutive quarters, extend beyond the Maturity Date of
the Debentures or end on a date other than an Interest Payment Date. The
foregoing notwithstanding, any Extended Interest Payment Period shall
automatically expire upon the occurrence of an Event of Default. Upon the
termination of any Extended Interest Payment Period and upon the payment of all
Deferred Interest then due, the Corporation may commence a new Extended
Interest Payment Period, subject to the foregoing requirements. No interest
shall be due and payable during an Extended Interest Payment Period, except at
the end thereof, but the Corporation may prepay at any time all or any portion
of the interest accrued during an Extended Interest Payment Period, which
prepayments shall be payable to the holders of the Debentures in whose names
the Debentures are registered in the Debenture Register as of 5:00 p.m., New
York, New York time on the Regular Record Date immediately preceding the date
of prepayment.

SECTION 5.2       NOTICE OF EXTENSION.

         (a)      If the Property Trustee is the only registered holder of the
Debentures at the time the Corporation selects an Extended Interest Payment
Period, the Corporation shall give written notice to the Administrative
Trustees, the Property Trustee and the Trustee of its selection of such
Extended Interest Payment Period at least two Business Days before the earlier
of (i) the next succeeding date on which Distributions (as such term is defined
in the Trust Agreement) on the Trust Securities issued by the Trust are
payable; or (ii) the date the Trust is required to give notice of the record
date or the date such Distributions are payable to the Nasdaq National Market
or other self regulatory organization or to holders of the Preferred Securities
issued by the Trust, but in any event at least one Business Day before such
record date.

         (b)      If the Property Trustee is not the only holder of the
Debentures at the time the Corporation selects an Extended Interest Payment
Period, the Corporation shall give the holders of the Debentures and the
Trustee written notice of its selection of such Extended Interest Payment
Period at least two Business Days before the earlier of (i) the next succeeding
Interest Payment Date; or (ii) the date the Corporation is required to give
notice of the record or payment date of such interest payment to holders of the
Debentures, but in any event at least one Business Day before such record date.

                                    Page 29
<PAGE>

         (c)      The quarter in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 5.2 shall be counted as one of the 20
quarters permitted in the Minimum Extended Interest Payment Period permitted
under Section 5.1.

SECTION 5.3       LIMITATION ON TRANSACTIONS.

         If (i) there shall have occurred any event that would constitute an
Event of Default; (ii) the Corporation shall be in default with respect to its
payment of any obligations under the Preferred Securities Guarantee relating to
the Trust; or (iii) the Corporation shall have given notice of its election to
defer payments of interest on such Debentures by extending the interest payment
period as provided in this Indenture and such period, or any extension thereof,
shall be continuing, then (a) the Corporation will not and will not permit any
Subsidiary to declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Corporation's capital stock (other than (1) the reclassification of any class
of the Corporation's capital stock into another class of its capital stock; (2)
dividends or distributions payable in any class of the Corporation's common
stock, (3) any declaration of a dividend in connection with the implementation
of a shareholder rights plan, or the issuance of stock under any such plan in
the future, or the redemption or repurchase of any such rights pursuant
thereto); (b) the Corporation will not and will not permit any Subsidiary to
make any payment of interest, principal or premium, if any, or repay,
repurchase or redeem any debt securities issued by the Corporation (including
Other Debentures) which rank pari passu with or junior to the Debentures; or
make any guarantee payments with respect to any guarantee by the Corporation of
the debt securities of any Subsidiary of the Corporation if such guarantee
ranks pari passu with or is junior to the Debentures; provided, however, that
notwithstanding the foregoing the Corporation may make payments pursuant to its
obligations under the Preferred Securities Guarantee; and (c) the Corporation
shall not redeem, purchase or acquire less than all of the outstanding
Debentures or any of the Preferred Securities.

                                  ARTICLE VI.
                    PARTICULAR COVENANTS OF THE CORPORATION

SECTION 6.1       PAYMENT OF PRINCIPAL AND INTEREST.

         The Corporation shall duly and punctually pay or cause to be paid the
principal of and interest on the Debentures at the time and place and in the
manner provided herein. Each such payment of the principal of and interest on
the Debentures shall relate only to the Debentures, shall not be combined with
any other payment of the principal of or interest on any other obligation of
the Corporation, and shall be clearly and unmistakably identified as pertaining
to the Debentures.

SECTION 6.2       MAINTENANCE OF AGENCY.

         So long as any of the Debentures remain Outstanding, the Corporation
shall maintain an office or agency where (i) Debentures may be presented for
payment; (ii) Debentures may be presented as hereinabove authorized for
registration of transfer and exchange; and (iii) notice and demands to or upon
the Corporation in respect of the Debentures and this Indenture may be given or
served, such designation to continue with respect to such office or agency
until the Corporation shall, by written notice signed by its Chairman,
President or a Vice President and delivered to the Trustee, designate some
other office or agency for such purposes or any of them. If at any time the
Corporation shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Corporation hereby appoints the Trustee as its agent to
receive all such presentations, notices and demands. In addition to any such
office or agency, the Corporation may from time to time designate one or more
offices or agencies where the Debentures may be presented for registration or
transfer and for exchange in the manner provided herein, and the Corporation
may from time to time rescind such designation as the Corporation may deem
desirable or expedient; provided, however, that no such designation or
rescission shall in any manner relieve the Corporation of its obligation to
maintain any such office or agency in the Place of Payment for such purposes.
The Corporation shall give the Trustee prompt written notice of any such
designation or rescission thereof.

                                    Page 30
<PAGE>

SECTION 6.3       PAYING AGENTS.

         (a)      The Corporation shall be the initial paying agent. If the
Corporation shall appoint one or more paying agents for the Debentures, other
than the Trustee, the Corporation shall cause each such paying agent to execute
and deliver to the Trustee an instrument in which such agent shall agree with
the Trustee, subject to the provisions of this Section 6.3:

                  (i)      that it shall hold all sums held by it as such agent
for the payment of the principal of or interest on the Debentures (whether such
sums have been paid to it by the Corporation or by any other obligor of such
Debentures) in trust for the benefit of the Persons entitled thereto;

                  (ii)     that it shall give the Trustee prompt written notice
of any failure by the Corporation (or by any other obligor of such Debentures)
to make any payment of the principal of or interest on the Debentures when the
same shall be due and payable;

                  (iii)    that it shall, at any time during the continuance of
any failure referred to in the preceding paragraph (a)(ii) above, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held
in trust by such paying agent; and

                  (iv)     that it shall perform all other duties of paying
agent as set forth in this Indenture.

         (b)      If the Corporation shall act as its own paying agent with
respect to the Debentures, it shall on or before each due date of the principal
of or interest on such Debentures, set aside, segregate and hold in trust for
the benefit of the Persons entitled thereto a sum sufficient to pay such
principal or interest so becoming due on Debentures until such sums shall be
paid to such Persons or otherwise disposed of as herein provided and shall
promptly notify the Trustee of such action, or any failure (by it or any other
obligor on such Debentures) to take such action. Whenever the Corporation shall
have one or more paying agents for the Debentures, it shall, prior to each due
date of the principal of or interest on any Debentures, deposit with the paying
agent a sum sufficient to pay the principal or interest so becoming due, such
sum to be held in trust for the benefit of the Persons entitled to such
principal or interest, and (unless such paying agent is the Trustee) the
Corporation shall promptly notify the Trustee of this action or failure so to
act.

         (c)      Notwithstanding anything in this Section 6.3 to the contrary,
(i) the agreement to hold sums in trust as provided in this Section 6.3 is
subject to the provisions of Section 14.3 and 14.4; and (ii) the Corporation
may at any time, for the purpose of obtaining the satisfaction and discharge of
this Indenture or for any other purpose, pay, or direct any paying agent to
pay, to the Trustee all sums held in trust by the Corporation or such paying
agent, such sums to be held by the Trustee upon the same terms and conditions
as those upon which such sums were held by the Corporation or such paying
agent; and, upon such payment by any paying agent to the Trustee, such paying
agent shall be released from all further liability with respect to such money.

SECTION 6.4       APPOINTMENT TO FILL VACANCY IN OFFICE OF TRUSTEE.

         The Corporation, whenever necessary to avoid or fill a vacancy in the
office of Trustee, shall appoint, in the manner provided in Section 10.11, a
Trustee that meets the requirements of Section 10.10, so that there shall at
all times be a Trustee hereunder.

SECTION 6.5       COMPLIANCE WITH CONSOLIDATION PROVISIONS.

         The Corporation shall not, while any of the Debentures remain
outstanding, consolidate with, or merge into, or merge into itself, or convert
into a different type of entity, or convey, transfer or lease all or
substantially all of its property and assets to any other entity and no entity
shall consolidate with or merge into the Corporation or convey, transfer or
lease substantially all of its properties and assets to the Corporation, unless
the provisions of Article XIII hereof are complied with.

                                    Page 31
<PAGE>

SECTION 6.6       LIMITATION ON TRANSACTIONS.

         If Debentures are issued to the Trust or a trustee of the Trust in
connection with the issuance of Trust Securities by the Trust and (i) there
shall have occurred any event that would constitute an Event of Default; (ii)
the Corporation shall be in default with respect to its payment of any
obligations under the Preferred Securities Guarantee relating to the Trust; or
(iii) the Corporation shall have given notice of its election to defer payments
of interest on such Debentures by extending the interest payment period as
provided in this Indenture and such period, or any extension thereof, shall be
continuing, then (a) the Corporation will not and will not permit any
Subsidiary to declare or pay any dividend on, make any distributions with
respect to, or redeem, purchase, acquire or make a liquidation payment with
respect to, any of Corporation's capital stock (other than (1) the
reclassification of any class of the Corporation's capital stock into another
class of capital stock, (2) dividends or distributions payable in any class of
the Corporation's common stock, (3) any declaration of a dividend in connection
with the implementation of a shareholder rights plan, or the issuance of stock
under any such plan in the future, or the redemption or repurchase of any such
rights pursuant thereto); (b) the Corporation will not and will not permit any
Subsidiary to make any payment of interest, principal or premium, if any, or
repay, repurchase or redeem any debt securities issued by the Corporation
(including Other Debentures) which rank pari passu with or junior to the
Debentures; or make any guarantee payments with respect to any guarantee by the
Corporation of the debt securities of any Subsidiary of the Corporation if such
guarantee ranks pari passu with or junior to the Debentures; provided, however,
that, notwithstanding the foregoing the Corporation may make payments pursuant
to its obligations under the Preferred Securities Guarantee; and (c) the
Corporation shall not redeem, purchase or acquire less than all of the
outstanding Debentures or any of the Preferred Securities.

SECTION 6.7       COVENANTS AS TO THE TRUST.

         For so long as such Trust Securities of the Trust remain outstanding,
the Corporation shall (i) maintain 100% direct or indirect ownership of the
Common Securities of the Trust; provided, however, that any permitted successor
of the Corporation under this Indenture may succeed to the Corporation's
ownership of the Common Securities; (ii) not voluntarily dissolve, wind up or
liquidate the Trust, except upon prior regulatory approval if then so required
under applicable capital guidelines or regulatory policies, and use its
reasonable efforts to cause the Trust (a) to remain a business trust, except in
connection with a distribution of Debentures, the redemption of all of the
Trust Securities of the Trust or certain mergers, consolidations or
amalgamations, each as permitted by the Trust Agreement; and (b) to otherwise
continue not to be treated as an association taxable as a corporation or
partnership for United States federal income tax purposes; (iii) use its
reasonable efforts to cause each holder of Trust Securities to be treated as
owning an individual beneficial interest in the Debentures; and (iv) the
Corporation, and any successor to the Corporation, shall use best efforts to
maintain the eligibility of the Preferred Securities for quotation or listing
on any national securities exchange or other organization on which the
Preferred Securities are then quoted or listed (including, if applicable, the
Nasdaq National Market) and shall use best efforts to keep the Preferred
Securities so quoted or listed for so long as the Preferred Securities remain
outstanding. In connection with the distribution of the Debentures to the
holders of the Preferred Securities issued by the Trust upon a Dissolution
Event, the Corporation shall use its best efforts to list such Debentures on
The Nasdaq National Market or on such other exchange as the Preferred
Securities are then listed. For so long as the Debentures remain outstanding
the Corporation shall fulfill all reporting and filing obligations under the
Securities Exchange Act of 1934, as amended, as applicable to companies having
a class of securities registered under Section 12(b) or 12(g) thereunder.

SECTION 6.8       COVENANTS AS TO PURCHASES.

         Prior to April 1, 2007, the Corporation shall not purchase any
Debentures, in whole or in part, from the Trust, except as otherwise permitted
under Article III hereof.

SECTION 6.9       WAIVER OF USURY, STAY OR EXTENSION LAWS.

         The Corporation shall not at any time insist upon, or plead, or in any
manner whatsoever claim or take the benefit or advantage of, any usury, stay or
extension law wherever enacted, now or at any time hereafter in force, which
may affect the covenants or the performances of this Indenture, and the
Corporation (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not

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hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.

                                  ARTICLE VII.
                     DEBENTUREHOLDERS' LISTS AND REPORTS BY
                        THE CORPORATION AND THE TRUSTEE

SECTION 7.1       CORPORATION TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
DEBENTUREHOLDERS.

         The Corporation shall furnish or cause to be furnished to the Trustee
a list, in such form as the Trustee may reasonably require, of the names and
addresses of the holders of the Debentures as of each January 1 and June 30 of
each year and at such other times as the Trustee may request in writing within
30 days after receipt by the Corporation; provided that the Corporation shall
not be obligated to furnish or cause to furnish such list at any time that the
list shall not differ in any respect from the most recent list furnished to the
Trustee by the Corporation; provided, however, that, in either case, no such
list need be furnished if the Trustee shall be the Debenture Registrar, or if
the Trust is the sole Debentureholder.

SECTION 7.2       PRESERVATION OF INFORMATION; COMMUNICATIONS WITH
DEBENTUREHOLDERS.

         (a)      The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of the
holders of Debentures contained in the most recent list furnished to it as
provided in Section 7.1 and as to the names and addresses of holders of
Debentures received by the Trustee in its capacity as registrar for the
Debentures (if acting in such capacity).

         (b)      The Trustee may destroy any list furnished to it as provided
in Section 7.1 upon receipt of a new list so furnished.

         (c)      Debentureholders may communicate as provided in Section
312(b) of the Trust Indenture Act with other Debentureholders with respect to
their rights under this Indenture or under the Debentures. The Trustee shall
comply with the provisions of said Section and shall be entitled to the
protections provided by Section 312(c) of the Trust Indenture Act.

SECTION 7.3       REPORTS BY THE CORPORATION.

         (a)      The Corporation covenants and agrees to file with the
Trustee, within 15 days after the Corporation is required to file the same with
the Commission, copies of the annual reports and of the information, documents
and other reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe) that the
Corporation may be required to file with the Commission pursuant to Section 13
or Section 15(d) of the Exchange Act; or, if the Corporation is not required to
file information, documents or reports pursuant to either of such Sections,
then to file with the Trustee and the Commission, in accordance with the rules
and regulations prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports that may be
required pursuant to Section 13 of the Exchange Act.

         (b)      The Corporation covenants and agrees to file with the Trustee
and the Commission, in accordance with the rules and regulations prescribed
from to time to time by the Commission, such additional information, documents
and reports with respect to compliance by the Corporation with the conditions
and covenants provided for in this Indenture as may be required from time to
time by such rules and regulations.

         (c)      The Corporation covenants and agrees to transmit to the
Debentureholders, in the manner and to the extent provided in Section 313(c) of
the Trust Indenture Act, within 30 days after the filing thereof with the
Trustee, such summaries of any information, documents and reports required to
be filed by the Corporation pursuant to subsections (a) and (b) of this Section
7.3 as may be required by rules and regulations prescribed from time to time by
the Commission.

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<PAGE>

         (d)      Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein
or determinable from information contained therein, including the Corporation's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).

SECTION 7.4       REPORTS BY THE TRUSTEE.

         (a)      On or before July 31 in each year in which any of the
Debentures are Outstanding, the Trustee shall transmit by mail, first class
postage prepaid, to the Debentureholders, as their names and addresses appear
upon the Debenture Register, a brief report dated as of the preceding June 30,
if and to the extent required under Section 313(a) of the Trust Indenture Act.

         (b)      The Trustee shall comply with Section 313(b) and 313(c) of
the Trust Indenture Act.

         (c)      A copy of each such report shall, at the time of such
transmission to Debentureholders, be filed by the Trustee with each stock
exchange, if any, upon which the Debentures are listed, with the Commission and
with the Corporation. The Corporation will promptly notify the Trustee when any
Debentures become listed on any stock exchange.

SECTION 7.5       STATEMENTS AS TO DEFAULT.

         (a)      The Corporation will deliver to the Trustee annually, within
120 days after the end of each of its fiscal years, a certificate, from its
principal executive officer, principal financial officer or principal
accounting officer, stating whether or not to the best knowledge of the signer
thereof the Corporation is in compliance (without regard to periods of grace or
notice requirements) with all conditions and covenants under this Indenture,
and if the Corporation shall not be in compliance, specifying such
non-compliance and the nature and status thereof of which such signer may have
knowledge.

         (b)      The Corporation shall deliver to the Trustee, as soon as
possible and in any event within five days after the Corporation becomes aware
of the occurrence of any Event of Default or an event which, with notice or the
lapse of time or both, would constitute an Event of Default, an Officers'
Certificate setting forth the details of such Event of Default or Default and
the action which the Corporation proposes to take with respect thereto.

                                 ARTICLE VIII.
                  REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
                              ON EVENT OF DEFAULT

SECTION 8.1       EVENTS OF DEFAULT.

         (a)      Whenever used herein with respect to the Debentures, "Event
of Default" means any one or more of the following events that has occurred and
is continuing:

                  (i)      the Corporation defaults in the payment of any
installment of interest upon any of the Debentures, as and when the same shall
become due and payable, and continuance of such default for a period of 30
days; provided, however, that a valid extension of an interest payment period
by the Corporation in accordance with the terms of Article V of this Indenture
shall not constitute a default in the payment of interest for this purpose;

                  (ii)     the Corporation defaults in the payment of the
principal on the Debentures as and when the same shall become due and payable
whether at maturity, upon redemption, by declaration of acceleration of
maturity or otherwise;

                  (iii)    the Corporation fails to observe or perform any
other of its covenants or agreements with respect to the Debentures for a
period of 90 days after the earlier of (A) the date on which written notice of
such failure, requiring the same to be remedied and stating that such notice is
a "Notice of Default" hereunder, shall have been

                                    Page 34
<PAGE>

given to the Corporation by the Trustee, by registered or certified mail, or to
the Corporation and the Trustee by the holders of at least 25% in aggregate
principal amount of the Debentures at the time Outstanding or (B) the date by
which the Corporation is required to provide an Officer's Certificate as to
such Default pursuant to Section 7.5(b);

                  (iv)     the Corporation pursuant to or within the meaning of
any Bankruptcy Law (i) commences a voluntary case; (ii) consents to the entry
of an order for relief against it in an involuntary case; (iii) consents to the
appointment of a Custodian of it or for all or substantially all of its
property; or (iv) makes a general assignment for the benefit of its creditors;

                  (v)      a court of competent jurisdiction enters an order
under any Bankruptcy Law that (i) is for relief against the Corporation in an
involuntary case; (ii) appoints a Custodian of the Corporation for all or
substantially all of its property; or (iii) orders the liquidation of the
Corporation, and the order or decree remains unstayed and in effect for 90
days; or

                  (vi)     the Trust shall have voluntarily or involuntarily
dissolved, wound-up its business or otherwise terminated its existence except
in connection with (i) the distribution of Debentures to holders of Trust
Securities in liquidation of their interests in the Trust; (ii) the redemption
of all of the outstanding Trust Securities of the Trust; or (iii) certain
mergers, consolidations or amalgamations, each as permitted by the Trust
Agreement.

         (b)      In each and every such case referred to in paragraphs (i),
(ii), (iii), (iv), (v) and (vi) of Section 8.1(a), unless the principal of all
the Debentures shall have already become due and payable, either the Trustee or
the holders of not less than 25% in aggregate principal amount of the
Debentures then Outstanding hereunder, by notice in writing to the Corporation
(and to the Trustee if given by such Debentureholders) may declare the
principal of all the Debentures to be due and payable immediately, and upon any
such declaration the same shall become and shall be immediately due and
payable, notwithstanding anything contained in this Indenture or in the
Debentures.

         (c)      At any time after the principal of the Debentures shall have
been so declared due and payable, and before any judgment or decree for the
payment of the monies due shall have been obtained or entered as hereinafter
provided, the holders of a majority in aggregate principal amount of the
Debentures then Outstanding hereunder, by written notice to the Corporation and
the Trustee, may rescind and annul such declaration and its consequences if:
(i) the Corporation has paid or deposited with the Trustee a sum sufficient to
pay all matured installments of interest upon all the Debentures and the
principal of any and all Debentures that shall have become due otherwise than
by acceleration (and, without duplication of any of the foregoing, interest
upon such principal, and upon overdue installments of interest, at the rate per
annum expressed in the Debentures to the date of such payment or deposit) and
the amount payable to the Trustee under Section 10.7; and (ii) any and all
Events of Default under this Indenture, other than the nonpayment of principal
on Debentures that shall not have become due by their terms, shall have been
remedied or waived as provided in Section 8.6. No such rescission and annulment
shall extend to or shall affect any subsequent default or impair any right
consequent thereon.

         (d)      In case the Trustee shall have proceeded to enforce any right
with respect to Debentures under this Indenture and such proceedings shall have
been discontinued or abandoned because of rescission or annulment or for any
other reason or shall have been determined adversely to the Trustee, then and
in every such case the Corporation and the Trustee shall be restored
respectively to their former positions and rights hereunder, and all rights,
remedies and powers of the Corporation and the Trustee shall continue as though
no such proceedings had been taken.

SECTION 8.2       COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.

         (a)      The Corporation covenants that (1) in case it shall default
in the payment of any installment of interest on any of the Debentures, and
such default shall have continued for a period of 90 Business Days; or (2) in
case it shall default in the payment of the principal of any of the Debentures
when the same shall have become due and payable, whether upon maturity of the
Debentures or upon redemption or upon declaration or otherwise, then, upon
demand of the Trustee, the Corporation shall pay to the Trustee, for the
benefit of the holders of the Debentures, the whole amount that then shall have
been become due and payable on all such Debentures for principal or interest,
or both, as the case may be, with interest upon the overdue principal and (if
the Debentures are held by the Trust or a trustee of the Trust, without
duplication of any other amounts paid by the Trust or trustee in respect
thereof) upon

                                    Page 35
<PAGE>

overdue installments of interest at the rate per annum expressed in the
Debentures; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, and the amount
payable to the Trustee and its counsel under Section 10.7.

         (b)      If the Corporation shall fail to pay such amounts forthwith
upon such demand, the Trustee, in its own name and as trustee of an express
trust, shall be entitled and empowered to institute any action or proceedings
at law or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceeding to judgment or final decree, and may
enforce any such judgment or final decree against the Corporation or other
obligor upon the Debentures and collect the monies adjudged or decreed to be
payable in the manner provided by law out of the property of the Corporation or
other obligor upon the Debentures, wherever situated.

         (c)      In case of any receivership, insolvency, liquidation,
bankruptcy, reorganization, readjustment, arrangement, composition or judicial
proceedings affecting the Corporation or the creditors or property of either,
the Trustee shall have power to intervene in such proceedings and take any
action therein that may be permitted by the court and shall (except as may be
otherwise provided by law) be entitled to file such proofs of claim and other
papers and documents as may be necessary or advisable in order to have the
claims of the Trustee and of the holders of the Debentures allowed for the
entire amount due and payable by the Corporation under this Indenture at the
date of institution of such proceedings and for any additional amount that may
become due and payable by the Corporation after such date, and to collect and
receive any monies or other property payable or deliverable on any such claim,
and to distribute the same after the deduction of the amount payable to the
Trustee and its counsel under Section 10.7; and any receiver, assignee or
trustee in bankruptcy or reorganization is hereby authorized by each of the
holders of the Debentures to make such payments to the Trustee, and, in the
event that the Trustee shall consent to the making of such payments directly to
such Debentureholders, to pay to the Trustee any amount due it under Section
10.7.

         (d)      All rights of action and of asserting claims under this
Indenture, or under any of the terms established with respect to Debentures,
may be enforced by the Trustee without the possession of any of such
Debentures, or the production thereof at any trial or other proceeding relating
thereto, and any such suit or proceeding instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of
judgment shall, after provision for payment to the Trustee of any amounts due
under Section 10.7, be for the ratable benefit of the holders of the
Debentures. In case of an Event of Default hereunder, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either at law or in
equity or in bankruptcy or otherwise, whether for the specific enforcement of
any covenant or agreement contained in this Indenture or in aid of the exercise
of any power granted in this Indenture, or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or by law. Nothing
contained herein shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Debentureholder any plan of
reorganization, arrangement, adjustment or composition affecting the Debentures
or the rights of any holder thereof or to authorize the Trustee to vote in
respect of the claim of any Debentureholder in any such proceeding.

SECTION 8.3       APPLICATION OF MONIES COLLECTED.

         Any monies or other assets collected by the Trustee pursuant to this
Article VIII with respect to the Debentures shall be applied in the following
order, at the date or dates fixed by the Trustee and, in case of the
distribution of such monies or other assets on account of principal or
interest, upon presentation of the Debentures, and notation thereon of the
payment, if only partially paid, and upon surrender thereof if fully paid:

         FIRST:   To the payment of costs and expenses of collection and of all
amounts payable to the Trustee under Section 10.7;

         SECOND:  To the payment of all Senior Indebtedness of the Corporation
if and to the extent required by Article XVII;

         THIRD:   To the payment of the amounts then due and unpaid upon the
Debentures for principal and interest, in respect of which or for the benefit
of which such money has been collected, ratably, without preference

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or priority of any kind, according to the amounts due and payable on such
Debentures for principal and interest, respectively; and

         FOURTH:  Any remaining balance to the Corporation.

SECTION 8.4       LIMITATION ON SUITS.

         (a)      No holder of any Debenture shall have any right by virtue or
by availing of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Indenture
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless (i) such holder previously shall have given to the Trustee
written notice of an Event of Default and of the continuance thereof with
respect to the Debentures specifying such Event of Default, as hereinbefore
provided; (ii) the holders of not less than 25% in aggregate principal amount
of the Debentures then Outstanding shall have made written request upon the
Trustee to institute such action, suit or proceeding in its own name as trustee
hereunder; (iii) such holder or holders shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby; (iv) the Trustee for 60 days
after its receipt of such notice, request and offer of indemnity, shall have
failed to institute any such action, suit or proceeding; and (v) during such 60
day period, the holders of the Debentures do not give the Trustee a direction
inconsistent with the request.

         (b)      Notwithstanding anything contained herein to the contrary or
any other provisions of this Indenture, the right of any holder of the
Debentures to receive payment of the principal of and interest on the
Debentures, as therein provided, on or after the respective due dates expressed
in such Debenture (or in the case of redemption, on the redemption date), or to
institute suit for the enforcement of any such payment on or after such
respective dates (or redemption date), shall not be impaired or affected
without the consent of such holder and by accepting a Debenture hereunder it is
expressly understood, intended and covenanted by the taker and holder of every
Debenture with every other such taker and holder and the Trustee, that no one
or more holders of Debentures shall have any right in any manner whatsoever by
virtue or by availing of any provision of this Indenture to affect, disturb or
prejudice the rights of the holders of any other of such Debentures, or to
obtain or seek to obtain priority over or preference to any other such holder,
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal, ratable and common benefit of all holders of
Debentures. For the protection and enforcement of the provisions of this
Section 8.4, each and every Debentureholder and the Trustee shall be entitled
to such relief as can be given either at law or in equity.

SECTION 8.5       RIGHTS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT WAIVER.

         (a)      All powers and remedies given by this Article VIII to the
Trustee or to the Debentureholders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any other powers and remedies available
to the Trustee or the holders of the Debentures, by judicial proceedings or
otherwise, to enforce the performance or observance of the covenants and
agreements contained in this Indenture or otherwise established with respect to
such Debentures.

         (b)      No delay or omission of the Trustee or of any holder of any
of the Debentures to exercise any right or power accruing upon any Event of
Default occurring and continuing as aforesaid shall impair any such right or
power, or shall be construed to be a waiver of any such default or an
acquiescence therein; and, subject to the provisions of Section 8.4, every
power and remedy given by this Article VIII or by law to the Trustee or the
Debentureholders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Debentureholders.

SECTION 8.6       CONTROL BY DEBENTUREHOLDERS.

         The holders of a majority in aggregate principal amount of the
Debentures at the time Outstanding, determined in accordance with Section 11.4,
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee; provided, however, that such direction shall
not be in conflict with any rule of law or with this Indenture. Subject to the
provisions of Section 10.1, the Trustee shall have the right to decline to
follow any such direction if the Trustee in good faith shall, by a Responsible
Officer or Officers of the Trustee, determine that the proceeding so directed

                                    Page 37
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would involve the Trustee in personal liability. The holders of a majority in
aggregate principal amount of the Debentures at the time Outstanding affected
thereby, determined in accordance with Section 11.4, may on behalf of the
holders of all of the Debentures waive any past default in the performance of
any of the covenants contained herein and its consequences, except (i) a
default in the payment of the principal of or interest on, any of the
Debentures as and when the same shall become due by the terms of such
Debentures otherwise than by acceleration (unless such default has been cured
and a sum sufficient to pay all matured installments of interest and principal,
other than principal maturing because of the acceleration, has been deposited
with the Trustee (in accordance with Section 8.1(c)); (ii) a default in the
covenants contained in Section 5.3; or (iii) in respect of a covenant or
provision hereof which cannot be modified or amended without the consent of the
holder of each Outstanding Debenture affected; provided, however, that if the
Debentures are held by the Trust or a trustee of the Trust, such waiver or
modification to such waiver shall not be effective until the holders of a
majority in liquidation preference of Preferred Securities of the Trust shall
have consented to such waiver or modification to such waiver; provided further,
that if the consent of the holder of each Outstanding Debenture is required,
such waiver shall not be effective until each holder of the Preferred
Securities of the Trust shall have consented to such waiver. Upon any such
waiver, the default covered thereby shall be deemed to be cured for all
purposes of this Indenture and the Corporation, the Trustee and the holders of
the Debentures shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.

SECTION 8.7       UNDERTAKING TO PAY COSTS.

         All parties to this Indenture agree, and each holder of any Debentures
by such holder's acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for
any action taken or omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit, and that such
court may in its discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; but the provisions of this Section 8.7 shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Debentureholder,
or group of Debentureholders, holding more than 25% in aggregate principal
amount of any Outstanding Debentures, or to any suit instituted by any
Debentureholder for the enforcement of the payment of the principal of or
interest on the Debentures, on or after the respective due dates expressed in
such Debenture or established pursuant to this Indenture.

SECTION 8.8       DIRECT ACTION BY HOLDERS OF PREFERRED SECURITIES.

         Notwithstanding the provisions of Section 2.10 of this Indenture, any
registered holder of the Preferred Securities issued by the Trust shall have
the right, upon the occurrence of an Event of Default described in Section
8.1(a)(i) or 8.1(a)(ii), to institute a suit directly against the Corporation
for enforcement of payment to such holder of principal of and interest on the
Debentures having a principal amount equal to the aggregate Liquidation Amount
(as defined in the Trust Agreement) of such Preferred Securities held by such
holder (a "Direct Action"). The Corporation may not amend this Indenture to
remove this right to institute a suit directly against the Corporation without
the prior written consent of the holders of all the Preferred Securities. In
connection with such Direct Action, the Corporation will have a right of
set-off under this Indenture to the extent of any payment actually made by the
Corporation to such holder of the Preferred Securities with respect to such
Direct Action.

                                  ARTICLE IX.
                      FORM OF DEBENTURE AND ORIGINAL ISSUE

SECTION 9.1       FORM OF DEBENTURE.

         The Debenture and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the forms contained as Exhibit A
attached hereto and incorporated herein by reference.

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SECTION 9.2       ORIGINAL ISSUE OF DEBENTURES.

         Debentures in the aggregate principal amount of up to Fifteen Million
Four Hundred Sixty-Four Thousand Dollars ($15,464,000) may, upon execution of
this Indenture, be executed by the Corporation and delivered to the Trustee for
authentication. If the Underwriters exercise their Option and there is an
Option Closing Date (as such terms are defined in the Underwriting Agreement,
dated February 8, 2002, by and among the Corporation, the Trust, and the
Underwriters) then, on such Option Closing Date, Debentures in the additional
aggregate principal amount of up to Two Million Three Hundred Twenty Thousand
Dollars ($2,320,000) may be executed by the Corporation and delivered to the
Trustee for authentication. The Trustee shall thereupon authenticate and make
available for delivery said Debentures upon the written order of the
Corporation, signed by its Chairman, its President, or any Vice President and
its Treasurer, an Assistant Treasurer, its Secretary or Assistant Secretary
without any further action by the Corporation.

                                   ARTICLE X.
                             CONCERNING THE TRUSTEE

SECTION 10.1      CERTAIN DUTIES AND RESPONSIBILITIES.

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

         (b)      No provision of this Indenture shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:

                  (i)      prior to the occurrence of an Event of Default and
after the curing or waiving of all Events of Default that may have occurred:

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

         (2)      in the absence of bad faith on the part of the Trustee, the
Trustee may with respect to the Indenture conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture; but in the case of any such certificates or
opinions that by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this Indenture;

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

                  (iii)    the 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 principal amount of the
Debentures at the time outstanding (within the meaning of Section 316(a) of the
Trust Indenture Act) relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee under this Indenture with respect to the
Debentures; and

                  (iv)     none of the provisions contained in this Indenture
shall require the Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if there is reasonable ground for
believing that the repayment of such funds or liability is

                                    Page 39
<PAGE>

not reasonably assured to it under the terms of this Indenture or adequate
indemnity against such risk is not reasonably assured to it.

SECTION 10.2      NOTICE OF DEFAULTS.

         The Trustee shall transmit by mail to all holders of the Debentures in
the manner and to the extent provided in Section 313(c) of the Trust Indenture
Act, notice of any Default hereunder, within 90 days after the occurrence
thereof; provided, however, that, except in the case of any default in the
payment of the principal or interest on any Debenture, the Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of the directors and/or
Responsible Officers of the Trustee determines in good faith that the
withholding of such notice is in the interests of the holders of such
Debentures.

SECTION 10.3      CERTAIN RIGHTS OF TRUSTEE.

         Except as otherwise provided in Section 10.1 or elsewhere in this
Indenture:

         (a)      The Trustee may conclusively rely and shall be protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, bond, debenture, security or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;

         (b)      Any request, direction, order or demand of the Corporation
mentioned herein shall be sufficiently evidenced by a Board Resolution or an
instrument signed in the name of the Corporation by the Chairman, President or
any Vice President and by the Secretary or an Assistant Secretary or the
Treasurer or an Assistant Treasurer thereof (unless other evidence in respect
thereof is specifically prescribed herein);

         (c)      The Trustee shall not be deemed to have knowledge of a
Default or an Event of Default, other than an Event of Default specified in
Section 8.1(a)(i) or (ii), unless and until a responsible officer of the
Trustee has actual knowledge of such Default or Event of Default or it receives
notification of such Default or Event of Default from the Corporation or by
holders of at least 25% of the aggregate principal amount of the Debentures at
the time Outstanding or of at least 25% of the liquidation preference of Trust
Securities;

         (d)      The Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted hereunder in good faith and in reliance thereon;

         (e)      The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request, order or
direction of any of the Debentureholders, pursuant to the provisions of this
Indenture, unless such Debentureholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of an Event
of Default (that has not been cured or waived) to exercise with respect to the
Debentures such of the rights and powers vested in it by this Indenture, and to
use the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs;

         (f)      The Trustee shall not be liable for any action taken or
omitted to be taken by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Indenture;

         (g)      The 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,
security, or other papers or documents, unless requested in writing so to do by
the holders of not less than a majority in principal amount of the Outstanding
Debentures (determined as provided in Section 11.4); provided, however, that if
the payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such investigation is,
in the opinion of the Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such

                                    Page 40
<PAGE>

costs, expenses or liabilities as a condition to so proceeding. The reasonable
expense of every such examination shall be paid by the Corporation or, if paid
by the Trustee, shall be repaid by the Corporation upon demand; and

         (h)      The Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.

SECTION 10.4      TRUSTEE NOT RESPONSIBLE FOR RECITALS, ETC.

         (a)      The Recitals contained herein and in the Debentures, except
the certificates of authentication, shall be taken as the statements of the
Corporation, and the Trustee assumes no responsibility for the correctness of
the same.

         (b)      The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Debentures.

         (c)      The Trustee shall not be accountable for the use or
application by the Corporation of any of the Debentures or of the proceeds of
such Debentures, or for the use or application of any monies paid over by the
Trustee in accordance with any provision of this Indenture, or for the use or
application of any monies received by any paying agent other than the Trustee.

SECTION 10.5      MAY HOLD DEBENTURES.

         The Trustee or any paying agent or registrar for the Debentures, in
its individual or any other capacity, may become the owner or pledgee of
Debentures and, subject to Sections 10.9 and 10.14, may otherwise deal with the
Corporation with the same rights it would have if it were not Trustee, paying
agent or Debenture Registrar.

SECTION 10.6      MONIES HELD IN TRUST.

         Subject to the provisions of Section 14.5, all monies received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any monies received by it hereunder except such as it
may agree in writing with the Corporation to pay thereon.

SECTION 10.7      COMPENSATION AND REIMBURSEMENT.

         (a)      The Corporation covenants and agrees to pay to the Trustee,
and the Trustee shall be entitled to, such reasonable compensation (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust), as the Corporation and the Trustee may from time
to time agree in writing, for all services rendered by it in the execution of
the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, and, except as otherwise expressly
provided herein, the Corporation shall pay or reimburse the Trustee upon its
request for all reasonable expenses, disbursements and advances incurred or
made by the Trustee in accordance with any of the provisions of this Indenture
(including the reasonable compensation and the expenses and disbursements of
its counsel and of all Persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence or bad faith.
The Corporation also covenants to indemnify the Trustee (and its officers,
agents, directors and employees) for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on the part
of the Trustee and arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of defending
itself against any claim of liability in the premises.

         (b)      The obligations of the Corporation under this Section 10.7 to
compensate and indemnify the Trustee and to pay or reimburse the Trustee for
expenses, disbursements and advances shall constitute additional indebtedness
hereunder. Such additional indebtedness shall be secured by a lien prior to
that of the Debentures upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the benefit of the holders of
particular Debentures.

                                    Page 41
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SECTION 10.8      RELIANCE ON OFFICERS' CERTIFICATE.

         Except as otherwise provided in Section 10.1, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking
or suffering or omitting to take any action hereunder, then, solely for
purposes of determining whether the Trustee is in breach of its obligations,
such matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or bad faith on the part of the
Trustee, be deemed to be conclusively proved and established for the purposes
of such administration by an Officers' Certificate delivered to the Trustee and
such certificate, in the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken, suffered or
omitted to be taken by it under the provisions of this Indenture upon the faith
thereof.

SECTION 10.9      DISQUALIFICATION; CONFLICTING INTERESTS.

         If the Trustee has or shall acquire any "conflicting interest" within
the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the
Corporation shall in all respects comply with the provisions of Section 310(b)
of the Trust Indenture Act; provided, however, that for purposes of the first
proviso contained in Section 310 (b) of the Trust Indenture Act, the Trust
Agreement and Preferred Securities Guarantee shall be deemed to be specifically
described in this Indenture.

SECTION 10.10     CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.

         There shall at all times be a Trustee with respect to the Debentures
issued hereunder which shall at all times be a corporation organized and doing
business under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia or a corporation or other
Person permitted to act as trustee by the Commission, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $50,000,000, and subject to supervision or examination by federal,
state, territorial, or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 10.10, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. The Corporation may not,
nor may any Person directly or indirectly controlling, controlled by, or under
common control with the Corporation, serve as Trustee. In case at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section 10.10, the Trustee shall resign immediately in the manner and with the
effect specified in Section 10.11.

SECTION 10.11        RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

         (a)      The Trustee or any successor hereafter appointed, may at any
time resign by giving written notice thereof to the Corporation and by
transmitting notice of resignation by mail, first class postage prepaid, to the
Debentureholders, as their names and addresses appear upon the Debenture
Register. Upon receiving such notice of resignation, the Corporation shall
promptly appoint a successor trustee with respect to Debentures by written
instrument, in duplicate, executed by order of the Board of Directors, one copy
of which instrument shall be delivered to the resigning Trustee and one copy to
the successor trustee. If no successor trustee shall have been so appointed and
have accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning Trustee may petition at the expense of the
Corporation any court of competent jurisdiction for the appointment of a
successor trustee with respect to Debentures, or any Debentureholder who has
been a bona fide holder of a Debenture or Debentures for at least six months
may, subject to the provisions of Section 10.9, on behalf of himself and all
others similarly situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon after such notice, if any, as it
may deem proper, appoint a successor trustee.

         (b)      In case at any time any one of the following shall occur,

                  (i)      the Trustee shall fail to comply with the provisions
of Section 10.9 after written request therefor by the Corporation or by any
Debentureholder who has been a bona fide holder of a Debenture or Debentures
for at least six months; or

                                    Page 42
<PAGE>

                  (ii)     the Trustee shall cease to be eligible in accordance
with the provisions of Section 10.10 and shall fail to resign after written
request therefor by the Corporation or by any such Debentureholder; or

                  (iii)    the Trustee shall become incapable of acting, or
shall be adjudged bankrupt or insolvent, or commence a voluntary bankruptcy
proceeding, or a receiver of the Trustee or of its property shall be appointed
or consented to, or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case, the Corporation may remove
the Trustee with respect to all Debentures and appoint a successor trustee by
written instrument, in duplicate, executed by order of the Board of Directors,
one copy of which instrument shall be delivered to the Trustee so removed and
one copy to the successor trustee, or, subject to the provisions of Section
10.9, unless the Trustee's duty to resign is stayed as provided herein, any
Debentureholder who has been a bona fide holder of a Debenture or Debentures
for at least six months may, on behalf of that holder and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor trustee. Such court may thereupon
after such notice, if any, as it may deem proper and prescribe, remove the
Trustee and appoint a successor trustee.

         (c)      The holders of a majority in aggregate principal amount of
the Debentures at the time Outstanding may at any time remove the Trustee by so
notifying the Trustee and the Corporation and may appoint a successor Trustee
with the consent of the Corporation. If no successor trustee shall have been so
appointed and have accepted appointment within 30 days after such notification,
the Trustee may petition at the expense of the Corporation any court of
competent jurisdiction for the appointment of a successor trustee with respect
to Debentures, or any Debentureholder who has been a bona fide holder of a
Debenture or Debentures for at least six months may, subject to the provisions
of Section 10.9, on behalf of himself and all others similarly situated,
petition any such court for the appointment of a successor trustee. Such court
may appoint a successor trustee.

         (d)      No resignation or removal of the Trustee and no appointment
of a successor trustee with respect to the Debentures pursuant to any of the
provisions of this Section 10.11 shall become effective until acceptance of
appointment by the successor trustee as provided in Section 10.12.

         (e)      Any successor trustee appointed pursuant to this Section
10.11 may be appointed with respect to the Debentures, and at any time there
shall be only one Trustee with respect to the Debentures.

SECTION 10.12     ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

         (a)      In case of the appointment hereunder of a successor trustee
with respect to the Debentures, every successor trustee so appointed shall
execute, acknowledge and deliver to the Corporation and to the retiring Trustee
an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee; but, on the
request of the Corporation or the successor trustee, such retiring Trustee
shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor trustee all the rights, powers, and trusts of
the retiring Trustee and shall duly assign, transfer and deliver to such
successor trustee all property and money held by such retiring Trustee
hereunder.

         (b)      Upon request of any successor trustee, the Corporation shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor trustee all such rights, powers and trusts
referred to in paragraph (a) of this Section 10.12.

         (c)      No successor trustee shall accept its appointment unless at
the time of such acceptance such successor trustee shall be qualified and
eligible under this Article X.

         (d)      Upon acceptance of appointment by a successor trustee as
provided in this Section 10.12, the Corporation shall transmit notice of the
succession of such trustee hereunder by mail, first class postage prepaid, to
the Debentureholders, as their names and addresses appear upon the Debenture
Register. If the Corporation fails to transmit such notice within ten days
after acceptance of appointment by the successor trustee, the successor trustee
shall cause such notice to be transmitted at the expense of the Corporation.

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SECTION 10.13     MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.

         Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such corporation shall be qualified under the provisions of
Section 10.9 and eligible under the provisions of Section 10.10, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding. In case any
Debentures shall have been authenticated, but not delivered, by the Trustee
then in office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the Debentures
so authenticated with the same effect as if such successor Trustee had itself
authenticated such Debentures.

SECTION 10.14     PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE CORPORATION.

         The Trustee shall comply with Section 311(a) of the Trust Indenture
Act excluding any creditor relationship described in Section 311(b) of the
Trust Indenture Act. A Trustee who has resigned or been removed shall be
subject to Section 311(a) of the Trust Indenture Act to the extent included
therein.

                                  ARTICLE XI.
                        CONCERNING THE DEBENTUREHOLDERS

SECTION 11.1      EVIDENCE OF ACTION BY HOLDERS.

         (a)      Whenever in this Indenture it is provided that the holders of
a majority or specified percentage in aggregate principal amount of the
Debentures may take any action (including the making of any demand or request,
the giving of any notice, consent or waiver or the taking of any other action),
the fact that at the time of taking any such action the holders of such
majority or specified percentage have joined therein may be evidenced by any
instrument or any number of instruments of similar tenor executed by such
holders of Debentures in Person or by agent or proxy appointed in writing.

         (b)      If the Corporation shall solicit from the Debentureholders
any request, demand, authorization, direction, notice, consent, waiver or other
action, the Corporation may, at its option, as evidenced by an Officers'
Certificate, fix in advance a record date for the determination of
Debentureholders entitled to give such request, demand, authorization,
direction, notice, consent, waiver or other action, but the Corporation shall
have no obligation to do so. If such a record date is fixed, such request,
demand, authorization, direction, notice, consent, waiver or other action may
be given before or after the record date, but only the Debentureholders of
record at 5:00 p.m., New York, New York time on the record date shall be
computed to be Debentureholders for the purposes of determining whether
Debentureholders of the requisite proportion of Outstanding Debentures have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other action, and for that purpose the
Outstanding Debentures shall be computed as of the record date; provided,
however, that no such authorization, agreement or consent by such
Debentureholders on the record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than
six months after the record date.

SECTION 11.2      PROOF OF EXECUTION BY DEBENTUREHOLDERS.

         Subject to the provisions of Section 10.1, proof of the execution of
any instrument by a Debentureholder (such proof shall not require notarization)
or his agent or proxy and proof of the holding by any Person of any of the
Debentures shall be sufficient if made in the following manner:

         (a)      The fact and date of the execution by any such Person of any
instrument may be proved in any reasonable manner acceptable to the Trustee.

                                    Page 44
<PAGE>

         (b)      The ownership of Debentures shall be proved by the Debenture
Register of such Debentures or by a certificate of the Debenture Registrar
thereof.

         (c)      The Trustee may require such additional proof of any matter
referred to in this Section 11.2 as it shall deem necessary.

SECTION 11.3      WHO MAY BE DEEMED OWNERS.

         Prior to the due presentment for registration of transfer of any
Debenture, the Corporation, the Trustee, any paying agent, any Authenticating
Agent and any Debenture Registrar may deem and treat the Person in whose name
such Debenture shall be registered upon the books of the Corporation as the
absolute owner of such Debenture (whether or not such Debenture shall be
overdue and notwithstanding any notice of ownership or writing thereon made by
anyone other than the Debenture Registrar) for the purpose of receiving payment
of or on account of the principal of and interest on such Debenture (subject to
Section 2.3) and for all other purposes; and neither the Corporation nor the
Trustee nor any paying agent nor any Authenticating Agent nor any Debenture
Registrar shall be affected by any notice to the contrary.

SECTION 11.4      CERTAIN DEBENTURES OWNED BY CORPORATION DISREGARDED.

         In determining whether the holders of the requisite aggregate
principal amount of Debentures have concurred in any direction, consent or
waiver under this Indenture, the Debentures that are owned by the Corporation
or any other obligor on the Debentures or by any Person directly or indirectly
controlling or controlled by, or under common control with, the Corporation or
any other obligor on the Debentures shall be disregarded and deemed not to be
Outstanding for the purpose of any such determination, except that for the
purpose of determining whether the Trustee shall be protected in relying on any
such direction, consent or waiver, only Debentures that a Responsible Officer
of the Trustee actually knows are so owned shall be so disregarded. The
Debentures so owned that have been pledged in good faith may be regarded as
Outstanding for the purposes of this Section 11.4, if the pledgee shall
establish to the satisfaction of the Trustee the pledgee's right so to act with
respect to such Debentures and that the pledgee is not a Person directly or
indirectly, controlling or controlled by, or under direct or indirect common
control with, the Corporation or any such other obligor. In case of a dispute
as to such right, any decision by the Trustee taken upon the advice of counsel
shall be full protection to the Trustee.

SECTION 11.5      ACTIONS BINDING ON FUTURE DEBENTUREHOLDERS.

         At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 11.1, of the taking of any action by the holders of the
majority or percentage in aggregate principal amount of the Debentures
specified in this Indenture in connection with such action, any holder of a
Debenture that is shown by the evidence to be included in the Debentures the
holders of which have consented to such action may, by filing written notice
with the Trustee, and upon proof of holding as provided in Section 11.2, revoke
such action so far as concerns such Debenture. Except as aforesaid any such
action taken by the holder of any Debenture shall be conclusive and binding
upon such holder and upon all future holders and owners of such Debenture, and
of any Debenture issued in exchange therefor, on registration of transfer
thereof or in place thereof, irrespective of whether or not any notation in
regard thereto is made upon such Debenture. Any action taken by the holders of
the majority or percentage in aggregate principal amount of the Debentures
specified in this Indenture in connection with such action shall be
conclusively binding upon the Corporation, the Trustee and the holders of all
the Debentures.

                                  ARTICLE XII.
                            SUPPLEMENTAL INDENTURES

SECTION 12.1      SUPPLEMENTAL INDENTURES WITHOUT THE CONSENT OF
DEBENTUREHOLDERS.

         In addition to any supplemental indenture otherwise authorized by this
Indenture, the Corporation and the Trustee may from time to time and at any
time enter into an indenture or indentures supplemental hereto (which

                                    Page 45
<PAGE>

shall conform to the provisions of the Trust Indenture Act as then in effect),
without the consent of the Debentureholders, for one or more of the following
purposes:

         (a)      to cure any ambiguity, defect, or inconsistency herein or in
the Debentures;

         (b)      to comply with Article XIII;

         (c)      to provide for uncertificated Debentures in addition to or in
place of certificated Debentures;

         (d)      to add to the covenants of the Corporation for the benefit of
the holders of all or any of the Debentures or to surrender any right or power
herein conferred upon the Corporation;

         (e)      to evidence the succession of another corporation to the
Corporation, and the assumption by any such successor of the covenants of the
Corporation herein and in the Debentures contained;

         (f)      to convey, transfer, assign, mortgage or pledge to or with
the Trustee any property or assets which the Corporation may desire to convey,
transfer, assign, mortgage or pledge;

         (g)      to add to, delete from, or revise the conditions,
limitations, and restrictions on the authorized amount, terms, or purposes of
issue, authentication, and delivery of Debentures, as herein set forth, unless
such addition, deletion, or revision shall adversely affect the rights of any
Debentureholder in any material respect;

         (h)      to make any change that does not adversely affect the rights
of any Debentureholder in any material respect; or

         (i)      to provide for the issuance of and establish the form and
terms and conditions of the Debentures, to establish the form of any
certifications required to be furnished pursuant to the terms of this Indenture
or of the Debentures, or to add to the rights of the holders of the Debentures.

         The Trustee is hereby authorized to join with the Corporation in the
execution of any such supplemental indenture, and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into any such supplemental indenture
that adversely affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise. Any supplemental indenture authorized by the
provisions of this Section 12.1 may be executed by the Corporation and the
Trustee without the consent of the holders of any of the Debentures at the time
Outstanding, notwithstanding any of the provisions of Section 12.2.

SECTION 12.2      SUPPLEMENTAL INDENTURES WITH CONSENT OF DEBENTUREHOLDERS.

         With the consent (evidenced as provided in Section 11.1) of the
holders of not less than a majority in aggregate principal amount of the
Debentures at the time Outstanding, the Corporation, when authorized by Board
Resolutions, and the Trustee may from time to time and at any time enter into
an indenture or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as then in effect) for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or of modifying
in any manner not covered by Section 12.1 the rights of the holders of the
Debentures under this Indenture; provided, however, that no such supplemental
indenture shall without the consent of the holders of each Debenture then
Outstanding and affected thereby, (i) extend the fixed maturity of any
Debentures, reduce the principal amount thereof, or reduce the rate or extend
the time of payment of interest thereon (other than the Corporation's right to
defer interest pursuant to this Indenture), without the consent of the holder
of each Debenture so affected; or (ii) reduce the aforesaid percentage of
Debentures, the holders of which are required to consent to any such
supplemental indenture; provided further, that if the Debentures are held by
the Trust or a trustee of the Trust, such supplemental indenture shall not be
effective until the holders of a majority in liquidation preference of Trust
Securities of the Trust shall have consented in writing to such supplemental
indenture; provided further, that if the consent of the holder of each
Outstanding Debenture is required, such supplemental indenture shall not be
effective until each holder of the Trust Securities of the Trust shall have
consented in writing to such supplemental indenture. It shall not be necessary
for the consent of the

                                    Page 46
<PAGE>

Debentureholders affected thereby under this Section 12.2 to approve the
particular form of any proposed supplemental indenture, but it shall be
sufficient if such consent shall approve the substance thereof.

SECTION 12.3      EFFECT OF SUPPLEMENTAL INDENTURES.

         Upon the execution of any supplemental indenture pursuant to the
provisions of this Article XII, this Indenture shall be and be deemed to be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this Indenture
of the Trustee, the Corporation and the holders of Debentures shall thereafter
be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.

SECTION 12.4      DEBENTURES AFFECTED BY SUPPLEMENTAL INDENTURES.

         Debentures affected by a supplemental indenture that are authenticated
and delivered after the execution of such supplemental indenture pursuant to
the provisions of this Article XII may bear a notation in form approved by the
Corporation, as to any matter provided for in such supplemental indenture. If
the Corporation shall so determine, new Debentures so modified as to conform,
in the opinion of the Board of Directors of the Corporation, to any
modification of this Indenture contained in any such supplemental indenture may
be prepared by the Corporation, authenticated by the Trustee and delivered in
exchange for the Debentures then Outstanding.

SECTION 12.5      EXECUTION OF SUPPLEMENTAL INDENTURES.

         (a)      Upon the request of the Corporation, accompanied by Board
Resolutions authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of Debentureholders
required to consent thereto as aforesaid, the Trustee shall join with the
Corporation in the execution of such supplemental indenture unless such
supplemental indenture adversely affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion but shall not be obligated to enter into such supplemental
indenture. The Trustee, subject to the provisions of Section 10.1, may receive
an Opinion of Counsel as conclusive evidence that any supplemental indenture
executed pursuant to this Article XII is authorized or permitted by, and
conforms to, the terms of this Article XII and that it is proper for the
Trustee under the provisions of this Article XII to join in the execution
thereof.

         (b)      Promptly after the execution by the Corporation and the
Trustee of any supplemental indenture pursuant to the provisions of this
Section 12.5, the Trustee shall transmit by mail, first class postage prepaid,
a notice, setting forth in general terms the substance of such supplemental
indenture, to the Debentureholders as their names and addresses appear upon the
Debenture Register. Any failure of the Trustee to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.

                                 ARTICLE XIII.
                             SUCCESSOR CORPORATION

SECTION 13.1      CORPORATION MAY CONSOLIDATE, ETC.

         Nothing contained in this Indenture or in any of the Debentures shall
prevent any consolidation, conversion or merger of the Corporation with or into
any other corporation or corporations (whether or not affiliated with the
Corporation, as the case may be), or successive consolidations, conversions or
mergers in which the Corporation, as the case may be, or its successor or
successors shall be a party or parties, or shall prevent any sale, conveyance,
transfer or other disposition of the property of the Corporation, as the case
may be, or its successor or successors as an entirety, or substantially as an
entirety, to any other corporation (whether or not affiliated with the
Corporation, as the case may be, or its successor or successors) authorized to
acquire and operate the same; provided, however, the Corporation hereby
covenants and agrees that, (i) upon any such consolidation, conversion, merger,
sale, conveyance, transfer or other disposition, the due and punctual payment,
in the case of the Corporation, of the principal of and interest on all of the
Debentures, according to their tenor and the due and punctual performance and

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observance of all the covenants and conditions of this Indenture and the
Debentures to be kept or performed by the Corporation as the case may be, shall
be expressly assumed, by supplemental indenture (which shall conform to the
provisions of the Trust Indenture Act, as then in effect) satisfactory in form
to the Trustee executed and delivered to the Trustee by the entity formed by
such consolidation, or into which the Corporation, as the case may be, shall
have been merged or converted, or by the entity which shall have acquired such
property; (ii) in case the Corporation consolidates with, merges into or
converts to another Person or conveys or transfers its properties and assets
substantially then as an entirety to any Person, the successor Person is
organized under the laws of the United States or any state or the District of
Columbia; and (iii) immediately after giving effect thereto, no Event of
Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be continuing.

SECTION 13.2      SUCCESSOR CORPORATION SUBSTITUTED.

         (a)      In case of any such consolidation, conversion, merger, sale,
conveyance, transfer or other disposition and upon the assumption by the
successor corporation, by supplemental indenture, executed and delivered to the
Trustee and satisfactory in form to the Trustee, of, in the case of the
Corporation, the due and punctual payment of the principal of and interest on
all of the Debentures Outstanding and the due and punctual performance of all
of the covenants and conditions of this Indenture and the Debentures to be
performed by the Corporation, as the case may be, such successor corporation
shall succeed to and be substituted for the Corporation, with the same effect
as if it had been named as the Corporation herein, and thereupon the
predecessor corporation shall be relieved of all obligations and covenants
under this Indenture and the Debentures.

         (b)      In case of any such consolidation, conversion, merger, sale,
conveyance, transfer or other disposition such changes in phraseology and form
(but not in substance) may be made in the Debentures thereafter to be issued as
may be appropriate.

         (c)      Nothing contained in this Indenture or in any of the
Debentures shall prevent the Corporation from merging into itself or acquiring
by purchase or otherwise all or any part of the property of any other Person
(whether or not affiliated with the Corporation).

SECTION 13.3      EVIDENCE OF CONSOLIDATION, ETC. TO TRUSTEE.

         The Trustee, subject to the provisions of Section 10.1, may receive an
Opinion of Counsel as conclusive evidence that any such consolidation,
conversion, merger, sale, conveyance, transfer or other disposition, and any
such assumption, comply with the provisions of this Article XIII.

                                  ARTICLE XIV.
                           SATISFACTION AND DISCHARGE

SECTION 14.1      SATISFACTION AND DISCHARGE OF INDENTURE.

         If at any time: (a) the Corporation shall have delivered to the
Trustee for cancellation all Debentures theretofore authenticated (other than
any Debentures that shall have been destroyed, lost or stolen and that shall
have been replaced or paid as provided in Section 2.8 and Debentures for whose
payment money or Governmental Obligations have theretofore been deposited in
trust or segregated and held in trust by the Corporation (and thereupon repaid
to the Corporation or retained by Corporation and discharged from such trust,
as provided in Section 14.5)); or (b) all such Debentures not theretofore
delivered to the Trustee for cancellation shall have become due and payable, or
are by their terms to become due and payable within one year or are to be
called for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption, and the Corporation shall
deposit or cause to be deposited with the Trustee as trust funds the entire
amount in monies or Governmental Obligations, or a combination thereof,
sufficient, in the opinion of a firm of independent public accountants,
knowledgeable in such matters, expressed in written certification thereof
delivered to the Trustee, to pay at maturity or upon redemption all Debentures
not theretofore delivered to the Trustee for cancellation, including principal
and interest due or to become due to such date of maturity or date fixed for
redemption, as the case may be, and if the Corporation shall also pay or cause
to be paid all other sums payable hereunder by the

                                    Page 48
<PAGE>

Corporation; then this Indenture shall thereupon cease to be of further effect
except for the provisions of Sections 2.2, 2.3, 2.4, 2.6, 2.8, 6.1, 6.2, 6.3
and 10.10, that shall survive until the date of maturity or redemption date, as
the case may be, and Sections 10.7 and 14.5, that shall survive to such date
and thereafter, and the Trustee, on demand of the Corporation and at the cost
and expense of the Corporation, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture.

SECTION 14.2      DISCHARGE OF OBLIGATIONS.

         If at any time all Debentures not heretofore delivered to the Trustee
for cancellation or that have not become due and payable as described in
Section 14.1 shall have been paid by the Corporation by depositing irrevocably
with the Trustee as trust funds monies or an amount of Governmental Obligations
sufficient to pay at maturity or upon redemption all Debentures not theretofore
delivered to the Trustee for cancellation, including principal and interest due
or to become due to such date of maturity or date fixed for redemption, as the
case may be, and if the Corporation shall also pay or cause to be paid all
other sums payable hereunder by the Corporation, then after the date such
monies or Governmental Obligations, as the case may be, are deposited with the
Trustee, the obligations of the Corporation under this Indenture shall cease to
be of further effect except for the provisions of Sections 2.2, 2.3, 2.4, 2.6,
2.8, 6.1, 6.2, 6.3, 10.7, 10.10 and 14.5 hereof that shall survive until such
Debentures shall mature and be paid. Thereafter, Sections 10.7 and 14.5 shall
survive.

SECTION 14.3      DEPOSITED MONIES TO BE HELD IN TRUST.

         All monies or Governmental Obligations deposited with the Trustee
pursuant to Sections 14.1 or 14.2 shall be held in trust and shall be available
for payment as due, either directly or through any paying agent (including the
Corporation acting as its own paying agent), to the holders of the Debentures
for the payment or redemption of which such Monies or Governmental Obligations
have been deposited with the Trustee.

         The Corporation shall pay and indemnify the Trustee against any tax,
fee or other charge imposed on or assessed against the Government Obligations
deposited pursuant to Section 14.1 or the principal and interest received in
respect thereof, other than any such tax, fee or other charge which by law is
for the account of the holders of Outstanding Debentures.

SECTION 14.4      PAYMENT OF MONIES HELD BY PAYING AGENTS.

         In connection with the satisfaction and discharge of this Indenture,
all monies or Governmental Obligations then held by any paying agent under the
provisions of this Indenture shall, upon demand of the Corporation, be paid to
the Trustee and thereupon such paying agent shall be released from all further
liability with respect to such monies or Governmental Obligations.

SECTION 14.5      REPAYMENT TO CORPORATION.

         Any monies or Governmental Obligations deposited with any paying agent
or the Trustee, or then held by the Corporation in trust, for payment of
principal of or interest on the Debentures that are not applied but remain
unclaimed by the holders of such Debentures for at least two years after the
date upon which the principal of or interest on such Debentures shall have
respectively become due and payable, shall be repaid to the Corporation or
retained by Corporation, as the case may be, on December 31 of each year and
shall be discharged from such trust; and thereupon the paying agent and the
Trustee shall be released from all further liability with respect to such
monies or Governmental Obligations and the holder of any of the Debentures
entitled to receive such payment shall thereafter, as an unsecured general
creditor, look only to the Corporation for the payment thereof.

                                    Page 49
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                                  ARTICLE XV.
                    IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
                             OFFICERS AND DIRECTORS

SECTION 15.1      NO RECOURSE.

         (a)      No recourse under or upon any obligation, covenant or
agreement of this Indenture, or of the Debentures, or for any claim based
thereon or otherwise in respect thereof, shall be had against any incorporator,
stockholder, officer or director, past, present or future as such, of the
Corporation or of any predecessor or successor corporation, either directly or
through the Corporation or any such predecessor or successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being expressly
understood that this Indenture and the obligations issued hereunder are solely
corporate obligations, and that no such personal liability whatever shall
attach to, or is or shall be incurred by, the incorporators, stockholders,
officers or directors as such, of the Corporation or of any predecessor or
successor corporation, or any of them, because of the creation of the
indebtedness hereby authorized, or under or by reason of the obligations,
covenants or agreements contained in this Indenture or in any of the Debentures
or implied therefrom; and that any and all such personal liability of every
name and nature, either at common law or in equity or by constitution or
statute, of, and any and all such rights and claims against, every such
incorporator, stockholder, officer or director as such, because of the creation
of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of
the Debentures or implied therefrom, are hereby expressly waived and released
as a condition of, and as a consideration for, the execution of this Indenture
and the issuance of such Debentures.

         (b)      No recourse under or upon any obligation, covenant or
agreement of this Indenture, or of the Debentures, or for any claim based
thereon or otherwise in respect thereof, shall be had against any incorporator,
stockholder, officer or director, past, present or future as such, of the
Trustee or of any predecessor or successor corporation, either directly or
through the Trustee or any such predecessor or successor corporation, whether
by virtue of any constitution, statute or rule of law, or by the enforcement of
any assessment or penalty or otherwise; it being expressly understood that the
Indenture obligations of the Trustee are solely corporate obligations of the
Trustee, and that no such personal liability whatever shall attach to, or is or
shall be incurred by, the incorporators, stockholders, officers or directors as
such, of the Trustee or of any predecessor or successor corporation, or any of
them, because of the creation of the indebtedness hereby authorized, or under
or by reason of the obligations, covenants or agreements contained in this
Indenture or in any of the Debentures or implied therefrom; and that any and
all such personal liability of every name and nature, either at common law or
in equity or by constitution or statute, of, and any and all such rights and
claims against, every such incorporator, stockholder, officer or director as
such, because of the creation of the indebtedness hereby authorized, or under
or by reason of the obligations, covenants or agreements contained in this
Indenture or in any of the Debentures or implied therefrom, are hereby
expressly waived and released as a condition of, and as a consideration for,
the execution of this Indenture by the Trustee.

                                  ARTICLE XVI.
                            MISCELLANEOUS PROVISIONS

SECTION 16.1      EFFECT ON SUCCESSORS AND ASSIGNS.

         All the covenants, stipulations, promises and agreements in this
Indenture contained by or on behalf of the Corporation shall bind its
respective successors and assigns, whether so expressed or not.

SECTION 16.2      ACTIONS BY SUCCESSOR.

         Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Corporation shall and may be done and performed with like force and effect by
the corresponding board, committee or officer of any corporation that shall at
the time be the lawful sole successor of the Corporation.

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SECTION 16.3      SURRENDER OF CORPORATION POWERS.

         The Corporation by instrument in writing executed by appropriate
authority of its Board of Directors and delivered to the Trustee may surrender
any of the powers reserved to the Corporation, and thereupon such power so
surrendered shall terminate both as to the Corporation, as the case may be, and
as to any successor corporation.

SECTION 16.4      NOTICES.

         Except as otherwise expressly provided herein any notice or demand
that by any provision of this Indenture is required or permitted to be given or
served by the Trustee or by the holders of Debentures to or on the Corporation
may be given or served by being deposited first class postage prepaid in a
post-office letter box addressed (until another address is filed in writing by
the Corporation with the Trustee), as follows: Southern Community Financial
Corporation, 4701 Country Club Road, Winston-Salem, NC 27104, Attention: Chief
Executive Officer, F. Scott Bauer. Any notice, election, request or demand by
the Corporation or any Debentureholder to or upon the Trustee shall be deemed
to have been sufficiently given or made, for all purposes, if given or made in
writing at the Corporate Trust Office of the Trustee.

SECTION 16.5      GOVERNING LAW.

         This Indenture and each Debenture shall be deemed to be a contract
made under the laws of the State of North Carolina and for all purposes shall
be construed in accordance with the laws of said State without regard to
conflicts of law principles.

SECTION 16.6      TREATMENT OF DEBENTURES AS DEBT.

         It is intended that the Debentures shall be treated as indebtedness
and not as equity for federal income tax purposes. The provisions of this
Indenture shall be interpreted to further this intention.

SECTION 16.7      COMPLIANCE CERTIFICATES AND OPINIONS.

         (a)      Upon any application, request or demand by the Corporation to
the Trustee to take any action under any of the provisions of this Indenture,
including but not limited to actions which relate to the authentication and
delivery of the Debentures and to the satisfaction and discharge of the
Indenture, the Corporation shall furnish to the Trustee an Officers'
Certificate stating that all conditions precedent provided for in this
Indenture relating to the proposed action have been complied with and an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent have been complied with, except that in the case of any
such application or demand as to which the furnishing of such documents is
specifically required by any provision of this Indenture relating to such
particular application or demand, no additional certificate or opinion need be
furnished.

         (b)      Each certificate or opinion of the Corporation provided for
in this Indenture with respect to compliance with a condition or covenant in
this Indenture (other than the certificates provided for in Section 7.3(d))
shall include (1) a statement that the Person making such certificate or
opinion has read such covenant or condition; (2) a brief statement as to the
nature and scope of the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are based; (3) a statement
that, in the opinion of such Person, he has made such examination or
investigation as, in the opinion of such Person, is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and (4) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been complied with; provided,
however, that each such certificate shall comply with the provisions of Section
314 of the Trust Indenture Act.

SECTION 16.8      PAYMENTS ON BUSINESS DAYS.

         In any case where the date of maturity of interest or principal of any
Debenture or the date of redemption of any Debenture shall not be a Business
Day, then payment of interest or principal may be made on the next succeeding
Business Day with the same force and effect as if made on the nominal date of
maturity or redemption, and no interest shall accrue for the period after such
nominal date.

                                    Page 51
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SECTION 16.9      TRUST INDENTURE ACT: CONFLICTS WITH TRUST INDENTURE ACT

         If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties that are agreed, under Section 16.9(a),
to be imposed by Sections 310 through 317 inclusive, of the Trust Indenture
Act, such imposed duties shall control.

SECTION 16.10     COUNTERPARTS.

         This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one and the same instrument.

SECTION 16.11     SEVERABILITY.

         In case any one or more of the provisions contained in this Indenture
or in the Debentures shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Indenture or of the Debentures,
but this Indenture and the Debentures shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.

SECTION 16.12     ASSIGNMENT.

         The Corporation shall have the right at all times to assign any of its
respective rights or obligations under this Indenture to a direct or indirect
wholly owned Subsidiary of the Corporation, provided that, in the event of any
such assignment, the Corporation shall remain liable for all such obligations.
Subject to the foregoing, this Indenture is binding upon and inures to the
benefit of the parties hereto and their respective successors and assigns. This
Indenture may not otherwise be assigned by the parties hereto.

SECTION 16.13     ACKNOWLEDGMENT OF RIGHTS.

         The Corporation acknowledges that, with respect to any Debentures held
by the Trust or a trustee of the Trust, if the Property Trustee fails to
enforce its rights under this Indenture as the holder of the Debentures held as
the assets of the Trust, any holder of Preferred Securities may institute legal
proceedings directly against the Corporation to enforce such Property Trustee's
rights under this Indenture without first instituting any legal proceedings
against such Property 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 Corporation to pay interest or
principal on the Debentures on the date such interest or principal is otherwise
payable (or in the case of redemption, on the redemption date), the Corporation
acknowledges that a holder of Preferred Securities may directly institute a
proceeding for enforcement of payment to such holder of the principal of or
interest on the Debentures having a principal amount equal to the aggregate
liquidation amount of the Preferred Securities of such holder on or after the
respective due date specified in the Debentures.

                                 ARTICLE XVII.
                          SUBORDINATION OF DEBENTURES

SECTION 17.1      AGREEMENT TO SUBORDINATE.

         The Corporation covenants and agrees, and each holder of Debentures
issued hereunder by such holder's acceptance thereof likewise covenants and
agrees, that all Debentures shall be issued subject to the provisions of this
Article XVII; and each holder of a Debenture, whether upon original issue or
upon transfer or assignment thereof, accepts and agrees to be bound by such
provisions. The payment by the Corporation of the principal of and interest on
all Debentures issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and junior in right of payment to the
prior payment in full of all Senior Debt and Subordinated Debt (collectively,
"Senior Indebtedness") to the extent provided herein, whether outstanding at
the date of this Indenture or thereafter incurred. No provision of this Article
XVII shall prevent the occurrence of any default or Event of Default hereunder.

                                    Page 52
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SECTION 17.2      DEFAULT ON SENIOR DEBT OR SUBORDINATED DEBT.

         In the event and during the continuation of any default by the
Corporation in the payment of principal, premium, interest or any other payment
due on any Senior Indebtedness of the Corporation, or in the event that the
maturity of any Senior Indebtedness of the Corporation has been accelerated
because of a default, then, in either case, no payment shall be made by the
Corporation with respect to the principal (including redemption payments) of or
interest on the Debentures. In the event that, notwithstanding the foregoing,
any payment shall be received by the Trustee when such payment is prohibited by
the preceding sentence of this Section 17.2, such payment shall be held in
trust for the benefit of, and shall be paid over or delivered to, the holders
of Senior Indebtedness or their respective representatives, or to the trustee
or trustees under any indenture pursuant to which any of such Senior
Indebtedness may have been issued, as their respective interests may appear,
but only to the extent that the holders of the Senior Indebtedness (or their
representative or representatives or a trustee) notify the Corporation or the
Trustee in writing within 90 days of such payment of the amounts then due and
owing on the Senior Indebtedness and only the amounts specified in such notice
to the Trustee shall be paid to the holders of Senior Indebtedness.

SECTION 17.3      LIQUIDATION; DISSOLUTION; BANKRUPTCY.

         (a)      Upon any payment by the Corporation or distribution of assets
of the Corporation of any kind or character, whether in cash, property or
securities, to creditors upon any liquidation, dissolution or winding-up,
reorganization, assignment for the benefit of creditors, marshaling of assets
or any bankruptcy, insolvency, debt restructuring or similar proceedings in
connection with any insolvency or bankruptcy proceeding of the Corporation, all
amounts due upon all Senior Indebtedness of the Corporation shall first be paid
in full, or payment thereof provided for in money in accordance with its terms,
before any payment is made by the Corporation on account of the principal or
interest on the Debentures; and upon any such liquidation, dissolution,
winding-up, reorganization, assignment for the benefit of creditors, marshaling
of assets, any payment by the Corporation, or distribution of assets of the
Corporation of any kind or character, whether in cash, property or securities,
to which the holders of the Debentures or the Trustee would be entitled to
receive from the Corporation, except for the provisions of this Article XVII,
shall be paid by the Corporation or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the holders of the Debentures or by the Trustee under this Indenture if
received by them or it, directly to the holders of Senior Indebtedness of the
Corporation (pro rata to such holders on the basis of the respective amounts of
Senior Indebtedness held by such holders, as calculated by the Corporation) or
their representative or representatives, or to the trustee or trustees under
any indenture pursuant to which any instruments evidencing such Senior
Indebtedness may have been issued, as their respective interests may appear, to
the extent necessary to pay such Senior Indebtedness in full, in money or
money's worth, after giving effect to any concurrent payment or distribution to
or for the holders of such Senior Indebtedness, before any payment or
distribution is made to the holders of Debentures or to the Trustee.

         (b)      In the event that, notwithstanding the foregoing, any payment
or distribution of assets of the Corporation of any kind or character, whether
in cash, property or securities, prohibited by the foregoing, shall be received
by the Trustee before all Senior Indebtedness of the Corporation is paid in
full, or provision is made for such payment in money in accordance with its
terms, such payment or distribution shall be held in trust for the benefit of
and shall be paid over or delivered to the holders of such Senior Indebtedness
or their representative or representatives, or to the trustee or trustees under
any indenture pursuant to which any instruments evidencing such Senior
Indebtedness may have been issued, as their respective interests may appear, as
calculated by the Corporation, for application to the payment of all Senior
Indebtedness of the Corporation, as the case may be, remaining unpaid to the
extent necessary to pay such Senior Indebtedness in full in money in accordance
with its terms, after giving effect to any concurrent payment or distribution
to or for the benefit of the holders of such Senior Indebtedness.

         (c)      For purposes of this Article XVII, the words "cash, property
or securities" shall not be deemed to include shares of stock of the
Corporation as reorganized or readjusted, or securities of the Corporation or
any other corporation provided for by a plan of reorganization or readjustment,
the payment of which is subordinated at least to the extent provided in this
Article XVII with respect to the Debentures to the payment of all Senior
Indebtedness of the Corporation, as the case may be, that may at the time be
outstanding, provided that (i) such Senior Indebtedness is assumed by the new
corporation, if any, resulting from any such reorganization or readjustment;
and

                                    Page 53
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(ii) the rights of the holders of such Senior Indebtedness are not, without the
consent of such holders, altered by such reorganization or readjustment. The
consolidation of the Corporation with, or the merger of the Corporation into,
another corporation or the liquidation or dissolution of the Corporation
following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article XIII shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 17.3
if such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article XIII.
Nothing in Section 17.2 or in this Section 17.3 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 10.7.

SECTION 17.4      SUBROGATION.

         (a)      Subject to the payment in full of all Senior Indebtedness of
the Corporation, the rights of the holders of the Debentures shall be
subrogated to the rights of the holders of such Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Corporation,
as the case may be, applicable to such Senior Indebtedness until the principal
of and interest on the Debentures shall be paid in full; and for the purposes
of such subrogation, no payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the holders of the
Debentures or the Trustee would be entitled except for the provisions of this
Article XVII, and no payment over pursuant to the provisions of this Article
XVII to or for the benefit of the holders of such Senior Indebtedness by
holders of the Debentures or the Trustee, shall, as between the Corporation,
its creditors other than holders of Senior Indebtedness of the Corporation, and
the holders of the Debentures, be deemed to be a payment by the Corporation to
or on account of such Senior Indebtedness. It is understood that the provisions
of this Article XVII are and are intended solely for the purposes of defining
the relative rights of the holders of the Debentures, on the one hand, and the
holders of such Senior Indebtedness on the other hand.

         (b)      Nothing contained in this Article XVII or elsewhere in this
Indenture or in the Debentures is intended to or shall impair, as between the
Corporation, its creditors (other than the holders of Senior Indebtedness of
the Corporation), and the holders of the Debentures, the obligation of the
Corporation, which is absolute and unconditional, to pay to the holders of the
Debentures the principal of and interest on the Debentures as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the holders of the Debentures and
creditors of the Corporation, as the case may be, other than the holders of
Senior Indebtedness of the Corporation, nor shall anything herein or therein
prevent the Trustee or the holder of any Debenture from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture,
subject to the rights, if any, under this Article XVII of the holders of such
Senior Indebtedness in respect of cash, property or securities of the
Corporation, as the case may be, received upon the exercise of any such remedy.

         (c)      Upon any payment or distribution of assets of the Corporation
referred to in this Article XVII, the Trustee, subject to the provisions of
Article X, and the holders of the Debentures shall be entitled to conclusively
rely upon any order or decree made by any court of competent jurisdiction in
which such dissolution, winding-up, liquidation or reorganization proceedings
are pending, or a certificate of the receiver, trustee in bankruptcy,
liquidation trustee, agent or other Person making such payment or distribution,
delivered to the Trustee or to the holders of the Debentures, for the purposes
of ascertaining the Persons entitled to participate in such distribution, the
holders of Senior Indebtedness and other indebtedness of the Corporation, as
the case may be, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent thereto or to this
Article XVII.

SECTION 17.5      TRUSTEE TO EFFECTUATE SUBORDINATION.

         Each holder of Debentures by such holder's acceptance thereof
authorizes and directs the Trustee on such holder's behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article XVII and appoints the Trustee such holder's attorney-in-fact for
any and all such purposes.

SECTION 17.6      NOTICE BY THE CORPORATION.

         (a)      The Corporation shall give prompt written notice to a
Responsible Officer of the Trustee of any fact known to the Corporation that
would prohibit the making of any payment of monies to or by the Trustee in
respect of the Debentures pursuant to the provisions of this Article XVII.
Notwithstanding the provisions of this Article

                                    Page 54
<PAGE>

XVII or any other provisions of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts that would prohibit the
making of any payment of monies to or by the Trustee in respect of the
Debentures pursuant to the provisions of this Article XVII, unless and until a
Responsible Officer of the Trustee shall have received written notice thereof
from the Corporation or a holder or holders of Senior Indebtedness or from any
trustee therefor, and before the receipt of any such written notice, the
Trustee, subject to the provisions of Section 10.1, shall be entitled in all
respects to assume that no such facts exist; provided, however, that if the
Trustee shall not have received the notice provided for in this Section 17.6 at
least two Business Days prior to the date upon which by the terms hereof any
money may become payable for any purpose (including, without limitation, the
payment of the principal of or interest on any Debenture), then, anything
herein contained to the contrary notwithstanding, the Trustee shall have full
power and authority to receive such money and to apply the same to the purposes
for which they were received, and shall not be affected by any notice to the
contrary that may be received by it within two Business Days prior to such
date.

         (b)      The Trustee, subject to the provisions of Section 10.1, shall
be entitled to conclusively rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness of the
Corporation (or a trustee on behalf of such holder) to establish that such
notice has been given by a holder of such Senior Indebtedness or a trustee on
behalf of any such holder or holders. In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of
any Person as a holder of such Senior Indebtedness to participate in any
payment or distribution pursuant to this Article XVII, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction of the Trustee
as to the amount of such Senior Indebtedness held by such Person, the extent to
which such Person is entitled to participate in such payment or distribution
and any other facts pertinent to the rights of such Person under this Article
XVII, and, if such evidence is not furnished, the Trustee may defer any payment
to such Person pending judicial determination as to the right of such Person to
receive such payment.

SECTION 17.7      RIGHTS OF THE TRUSTEE; HOLDERS OF SENIOR INDEBTEDNESS.

         (a)      The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article XVII in respect of any Senior
Indebtedness at any time held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder. The Trustee's right to compensation and
reimbursement of expenses as set forth in Section 10.7 shall not be subject to
the subordination provisions of this Article XVII.

         (b)      With respect to the holders of Senior Indebtedness of the
Corporation, the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this Article XVII,
and no implied covenants or obligations with respect to the holders of such
Senior Indebtedness shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to have any fiduciary duty to the holders of such
Senior Indebtedness and, subject to the provisions of Section 10.1, the Trustee
shall not be liable to any holder of such Senior Indebtedness if it shall in
good faith mistakenly pay over or deliver to holders of Debentures, the
Corporation or any other Person money or assets to which any holder of such
Senior Indebtedness shall be entitled by virtue of this Article XVII or
otherwise.

SECTION 17.8      SUBORDINATION MAY NOT BE IMPAIRED.

         (a)      No right of any present or future holder of any Senior
Indebtedness of the Corporation to enforce subordination as herein provided
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Corporation or by any act or failure to act, in good
faith, by any such holder, or by any noncompliance by the Corporation with the
terms, provisions and covenants of this Indenture, regardless of any knowledge
thereof that any such holder may have or otherwise be charged with.

         (b)      Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness of the Corporation may, at any
time and from time to time, without the consent of or notice to the Trustee or
the holders of the Debentures, without incurring responsibility to the holders
of the Debentures and without impairing or releasing the subordination provided
in this Article XVII or the obligations hereunder of the holders of the
Debentures to the holders of such Senior Indebtedness, do any one or more of
the following: (i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, such Senior

                                    Page 55
<PAGE>

Indebtedness, or otherwise amend or supplement in any manner such Senior
Indebtedness or any instrument evidencing the same or any agreement under which
such Senior Indebtedness is outstanding; (ii) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing such
Senior Indebtedness; (iii) release any Person liable in any manner for the
collection of such Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Corporation and any other Person.

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed all as of the day and year first above written.

                           SOUTHERN COMMUNITY FINANCIAL CORPORATION

                                    By: /s/ F. Scott Bauer
                                       ----------------------------------------
                                    Name:  F. Scott Bauer
                                         --------------------------------------
                                    Title:  CEO
                                          -------------------------------------

                           WILMINGTON TRUST COMPANY, AS TRUSTEE

                                    By: /s/ Patricia A. Evans
                                       ----------------------------------------
                                    Name:  Patricia A. Evans
                                         --------------------------------------
                                    Title:  Senior Financial Services Officer
                                          -------------------------------------

                                    Page 56<PAGE>
                                  EXHIBIT 10.4

                    AMENDED AND RESTATED TRUST AGREEMENT OF
                       SOUTHERN COMMUNITY CAPITAL TRUST I

                      AMENDED AND RESTATED TRUST AGREEMENT

                                     AMONG

                    SOUTHERN COMMUNITY FINANCIAL CORPORATION

                                  AS DEPOSITOR

                                      AND

                            WILMINGTON TRUST COMPANY

                              AS PROPERTY TRUSTEE

                                      AND

                            WILMINGTON TRUST COMPANY

                              AS DELAWARE TRUSTEE

                                      AND

                    THE ADMINISTRATIVE TRUSTEES NAMED HEREIN

                         DATED AS OF FEBRUARY 13, 2002

                       SOUTHERN COMMUNITY CAPITAL TRUST I

                                     Page 1
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                        PAGE

<S>                                                                                                     <C>
ARTICLE I DEFINED TERMS...................................................................................5
Section 101. Definitions .................................................................................5

ARTICLE II ESTABLISHMENT OF THE TRUST.....................................................................12
Section 201. Name.........................................................................................12
Section 202. Office of the Property Trustee; Principal Place of Business..................................12
Section 203. Initial Contribution of Trust Property; Organizational Expenses..............................13
Section 204. Issuance of the Preferred Securities.........................................................13
Section 205. Issuance of the Common Securities; Subscription and Purchase of Debentures...................13
Section 206. Declaration of Trust.........................................................................14
Section 207. Authorization to Enter into Certain Transactions.............................................14
Section 208. Assets of Trust..............................................................................16
Section 209. Title to Trust Property......................................................................16

ARTICLE III PAYMENT ACCOUNT...............................................................................16
Section 301. Payment Account..............................................................................16

ARTICLE IV DISTRIBUTIONS; REDEMPTION......................................................................17
Section 401. Distributions................................................................................17
Section 402. Redemption...................................................................................17
Section 402A. Conversion..................................................................................19
Section 403. Subordination of Common Securities...........................................................21
Section 404. Payment Procedures...........................................................................21
Section 405. Tax Returns and Reports......................................................................22
Section 406. Payment of Taxes, Duties, etc. of the Trust..................................................22
Section 407. Payments Under Indenture.....................................................................22
Section 408. Taxes; Withholding...........................................................................22

ARTICLE V TRUST SECURITIES CERTIFICATES...................................................................23
Section 501. Initial Ownership............................................................................23
Section 502. The Trust Securities Certificates............................................................23
Section 503. Execution and Delivery of Trust Securities Certificates......................................23
Section 503A. Global Preferred Securities.................................................................24
Section 504. Registration of Transfer and Exchange of Preferred Securities Certificates...................25
Section 505. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates...........................26
Section 506. Persons Deemed Securityholders...............................................................26
Section 507. Access to List of Securityholders' Names and Addresses.......................................27
Section 508. Maintenance of Office or Agency..............................................................27
Section 509. Appointment of Paying Agent..................................................................27
Section 509A. Appointment of Conversion Agent.............................................................28
Section 510. Ownership of Common Securities by Depositor..................................................28
Section 511. Notices to Clearing Agency...................................................................28
Section 511A. Definitive Preferred Securities Certificate and Temporary Preferred Securities .............28
Section 512. Rights of Securityholders....................................................................29
Section 513. CUSIP Numbers ...............................................................................29

ARTICLE VI ACTS OF SECURITYHOLDERS; MEETINGS; VOTING......................................................30
Section 601. Limitations on Voting Rights.................................................................30
Section 602. Notice of Meetings...........................................................................30
Section 603. Meetings of Preferred Securityholders........................................................30
Section 604. Voting Rights................................................................................31
Section 605. Proxies, etc.................................................................................31
Section 606. Securityholder Action by Written Consent.....................................................31
Section 607. Record Date for Voting and Other Purposes....................................................31
</TABLE>

                                     Page 2
<PAGE>

<TABLE>
<S>                                                                                                       <C>
Section 608. Acts of Securityholders......................................................................31
Section 609. Inspection of Records........................................................................32

ARTICLE VII REPRESENTATIONS AND WARRANTIES................................................................32
Section 701. Representations and Warranties of the Property Trustee and the Bank..........................32
Section 702. Representations and Warranties of the Delaware Bank and the Delaware Trustee.................33
Section 703. Representations and Warranties of Depositor..................................................34

ARTICLE VIII TRUSTEES.....................................................................................34
Section 801. Certain Duties and Responsibilities..........................................................34
Section 802. Certain Notices..............................................................................35
Section 803. Certain Rights of Property Trustee...........................................................36
Section 804. Not Responsible for Recitals or Issuance of Securities.......................................37
Section 805. May Hold Securities..........................................................................37
Section 806. Compensation; Indemnity; Fees................................................................37
Section 807. Corporate Property Trustee Required; Eligibility of Trustees.................................38
Section 808. Conflicting Interests........................................................................38
Section 809. Co-Trustees and Separate Trustee.............................................................38
Section 810. Resignation and Removal; Appointment of Successor............................................39
Section 811. Acceptance of Appointment by Successor.......................................................40
Section 812. Merger, Conversion, Consolidation or Succession to Business..................................41
Section 813. Preferential Collection of Claims Against Depositor or Trust.................................41
Section 814. Reports by Property Trustee..................................................................41
Section 815. Reports to the Property Trustee..............................................................41
Section 816. Evidence of Compliance with Conditions Precedent.............................................42
Section 817. Number of Trustees...........................................................................42
Section 818. Delegation of Power..........................................................................42
Section 819. Voting.......................................................................................42

ARTICLE IX TERMINATION, LIQUIDATION AND MERGER............................................................43
Section 901. Dissolution Upon Expiration Date.............................................................43
Section 902. Early Dissolution............................................................................43
Section 903. Termination..................................................................................43
Section 904. Liquidation..................................................................................43
Section 905. Mergers, Consolidations, Amalgamations or Replacements of the Trust..........................44

ARTICLE X MISCELLANEOUS PROVISIONS........................................................................45
Section 1001. Limitation of Rights of Securityholders.....................................................45
Section 1002. Amendment...................................................................................45
Section 1003. Separability................................................................................46
Section 1004. Governing Law...............................................................................46
Section 1005. Payments Due on Non-Business Day............................................................46
Section 1006. Successors..................................................................................47
Section 1007. Headings....................................................................................47
Section 1008. Reports, Notices and Demands................................................................47
Section 1009. Agreement Not to Petition............................................................. .....47
Section 1010. Trust Indenture Act; Conflict with Trust Indenture Act......................................47
Section 1011. Acceptance of Terms of Trust Agreement, Guarantee and Indenture.............................48
</TABLE>

                                     Page 3
<PAGE>

                                    EXHIBITS

Exhibit A - Certificate of Trust
Exhibit B - Form of Common Securities Certificate
Exhibit C - Form of Expense Agreement
Exhibit D - Form of Preferred Securities Certificate
Exhibit E - Form of Preferred Securities Certificate Authentication
Exhibit F - Certificate Depositary Agreement

                             CROSS-REFERENCE TABLE

<TABLE>
<CAPTION>
Section of Trust Indenture Act                                                                       Section of Amended and
Of 1939, As Amended                                                                                Restated Trust Agreement

<S>                                                                                                <C>
310(a)(1).........................................................................................................807
310(a)(2).........................................................................................................807
310(a)(3).........................................................................................................807
310(a)(4)...................................................................................................207(a)(ii)
310(b)............................................................................................................808
311(a)............................................................................................................813
311(b)............................................................................................................813
312(a)............................................................................................................507
312(b)............................................................................................................507
312(c)............................................................................................................507
313(a)..........................................................................................................814(a)
313(b)..........................................................................................................814(a)
313(c)...................................................................................................814(a), 1008
313(d)..........................................................................................................814(b)
314(a)............................................................................................................815
314(b).................................................................................................Not Applicable
314(c)(1).........................................................................................................816
314(c)(2).........................................................................................................816
314(c)(3)..............................................................................................Not Applicable
314(d).................................................................................................Not Applicable
314(e).......................................................................................................101, 816
314(f).................................................................................................Not Applicable
315(a)..................................................................................................801(a), 803(a)
315(b)......................................................................................................802, 1008
315(c)..........................................................................................................801(a)
315(d).......................................................................................................801, 803
316(a)(2)..............................................................................................Not Applicable
316(b).................................................................................................Not Applicable
316(c)............................................................................................................607
317(a)(1)..............................................................................................Not Applicable
317(a)(2)..............................................................................................Not Applicable
317(b)............................................................................................................509
318(a)...........................................................................................................1010
</TABLE>

  Note: This Cross-Reference Table does not constitute part of this Agreement
   and shall not affect the interpretation of any of its terms or provisions.

                                     Page 4
<PAGE>

                      AMENDED AND RESTATED TRUST AGREEMENT

AMENDED AND RESTATED TRUST AGREEMENT, dated as of February 13, 2002, among (i)
SOUTHERN COMMUNITY FINANCIAL CORPORATION, a North Carolina corporation
(including any successors or assigns, the "Depositor"); (ii) WILMINGTON TRUST
COMPANY, a Delaware banking corporation, as property trustee (in such capacity,
the "Property Trustee" and, in its separate corporate capacity and not in its
capacity as Property Trustee, the "Bank"); (iii) WILMINGTON TRUST COMPANY, a
Delaware banking corporation, as Delaware trustee (in such capacity, the
"Delaware Trustee" and, in its separate corporate capacity and not in its
capacity as Delaware Trustee, the "Delaware Bank"); (iv) F. Scott Bauer, an
individual, Richard Cobb, an individual and Jeff T. Clark, an individual, each
of whose address is c/o Southern Community Financial Corporation, 4701 Country
Club Road, Winston-Salem, North Carolina 27104 (each an "Administrative
Trustee" and collectively the "Administrative Trustees") (the Property Trustee
and the Administrative Trustees referred to collectively as the "Trustees");
and (v) the Holders (as defined herein).

                                    RECITALS

WHEREAS, the Depositor, the Administrative Trustees, the Delaware Trustee and
the Property Trustee have heretofore duly declared and established a business
trust, Southern Community Capital Trust I, pursuant to the Delaware Business
Trust Act by the entering into of that certain Trust Agreement, dated as of
November 20, 2001 (the "Original Trust Agreement"), and by the execution and
filing by Depositor, the Administrative Trustees, the Property Trustee and the
Delaware Trustee with the Secretary of State of the State of Delaware of the
Certificate of Trust, filed on, November 20, 2001, the form of which is
attached as Exhibit A; and

WHEREAS, the Depositor and the Trustees desire to amend and restate the
Original Trust Agreement in its entirety as set forth herein to provide for,
among other things, (i) the issuance of the Common Securities (as defined
herein) by the Trust (as defined herein) to the Depositor; (ii) the issuance
and sale of the Preferred Securities (as defined herein) by the Trust pursuant
to the Underwriting Agreement (as defined herein); and (iii) the acquisition by
the Trust from the Depositor of all of the right, title and interest in the
Debentures (as defined herein).

NOW THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each party for the benefit of the
other parties and for the benefit of the Securityholders (as defined herein)
hereby amends and restates the Original Trust Agreement in its entirety and
agrees as follows.

                                   ARTICLE I
                                 DEFINED TERMS

SECTION 101.      DEFINITIONS.

For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:

         (a)      the terms defined in this Article I have the meanings
assigned to them in this Article I and include the plural as well as the
singular;

         (b)      all other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;

         (c)      unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and

                                     Page 5
<PAGE>

         (d)      the words "herein", "hereof and "hereunder" and other words
of similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.

         "Act" has the meaning specified in Section 608.

         "Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of additional interest
accrued on interest in arrears, including Compounded Interest as defined in
Section 5.1 of the Indenture, and paid by the Depositor on a Like Amount of
Debentures for such period.

         "Additional Interest" has the meaning specified in Section 1.1 of the
Indenture.

         "Administrative Trustee" means each of the Persons identified as an
"Administrative Trustee" in the preamble to this Trust Agreement solely in such
Person's capacity as Administrative Trustee of the Trust formed and continued
hereunder and not in such Person's individual capacity, or such Administrative
Trustee's successor in interest in such capacity, or any successor
Administrative Trustee appointed as herein provided.

         "Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding with power to vote 10% or
more of the outstanding voting securities or other ownership interests of the
specified Person; (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person; (c) any Person
directly or indirectly controlling, controlled by, or under common control with
the specified Person; (d) a partnership in which the specified Person is a
general partner; (e) any officer or director of the specified Person; and (f)
if the specified Person is an individual, any entity of which the specified
Person is an executive officer, director or general partner.

        "Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Preferred Security or beneficial interest
therein, the rules and procedures of the Depository for such Preferred
Security, in each case to the extent applicable to such transaction and as in
effect from time to time.

        "Bank" has the meaning specified in the Preamble to this Trust
Agreement.

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

         (a)      the entry of a decree or order by a court having jurisdiction
in the premises adjudging such Person a bankrupt or insolvent, or approving as
properly filed a petition seeking liquidation or reorganization of or in
respect of such Person under the United States Bankruptcy Code of 1978, as
amended, or any other similar applicable federal or state law, and the
continuance of any such decree or order unvacated and unstayed for a period of
90 days; or the commencement of an involuntary case under the United States
Bankruptcy Code of 1978, as amended, in respect of such Person, which shall
continue undismissed for a period of 90 days or entry of an order for relief in
such case and such order shall have remained in force unvacated and unstayed
for a period of 90 days; or the entry of a decree or order of a court having
jurisdiction in the premises for the appointment on the ground of insolvency or
bankruptcy of a receiver, custodian, liquidator, trustee or assignee in
bankruptcy or insolvency of such Person or of its property, or for the winding
up or liquidation of its affairs, and such decree or order shall have remained
in force unvacated and unstayed for a period of 90 days; or

         (b)      the institution by such Person of proceedings to be
adjudicated a voluntary bankrupt, or the consent by such Person to the filing
of a bankruptcy proceeding against it, or the filing by such Person of a
petition or answer or consent seeking liquidation or reorganization under the
United States Bankruptcy Code of 1978, as amended, or other similar applicable
Federal or State law, or the consent by such Person to the filing of any such
petition or to the appointment on the ground of insolvency or bankruptcy of a
receiver or custodian or liquidator or trustee or assignee in bankruptcy or
insolvency of such Person or of its property, or the making by such person of a
general assignment for the benefit of creditors.

         "Bankruptcy Laws" has the meaning specified in Section 1009.

                                     Page 6
<PAGE>

         "Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors, or such committee of the Board of
Directors or officers of the Depositor to which authority to act on behalf of
the Board of Directors has been delegated, and to be in full force and effect
on the date of such certification, and delivered to the appropriate Trustee.

         "Business Day" means any day other than (a) a Saturday or Sunday, (b)
a day on which banking institutions in the City of New York, New York are
authorized or required by law, executive order or regulation to close, or (c) a
day on which the principal Corporate Trust Office of the Property Trustee or of
the Debenture Trustee is closed for business.

         "Capital Treatment Event" has the meaning specified in Section 1.1 of
the Indenture.

         "Certificate Depository Agreement" means the agreement among the
Trust, the Depositor and DTC, as the initial Clearing Agency, dated as of the
Closing Date, substantially in the form attached as Exhibit F, as the same may
be amended and supplemented from time to time.

         "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 or restated from time to time, a copy of which is attached as Exhibit
A.

         "Change in 1940 Act Law" shall have the meaning set forth in the
definition of "Investment Company Event."

         "Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act. DTC shall be the initial
Clearing Agency.

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

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

         "Code" means the Internal Revenue Code of 1986, or any successor
statute, in each case as amended from time to time.

         "Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then
the body performing such duties at such time.

         "Common Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $10 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein. Common Securities rank pari
passu with the Preferred Securities; provided, however, that upon the
occurrence of an Event of Default, the right of holders of Common Securities to
payment in respect of (i) distributions, and (ii) payments upon liquidation,
redemption and otherwise are subordinated to the right of holders of Preferred
Securities.

         "Common Securities Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit
B.

         "Common Stock" means the no par value common stock of the Depositor.

         "Conversion Agent" has the meaning set forth in Section 402A(d).

         "Conversion Ratio" has the meaning specified in Section 402A(a).

                                     Page 7
<PAGE>

         "Corporate Trust Office" means (i) when used with respect to the
Property Trustee, the principal corporate trust office of the Property Trustee
located in Wilmington, DE, and (ii) when used with respect to the Debenture
Trustee, the principal corporate trust office of the Debenture Trustee located
in Wilmington, DE.

         "Coupon Rate" shall mean 7.25%.

         "Debenture Event of Default" means an "Event of Default" as defined in
Section 8.1 of the Indenture.

         "Debenture Redemption Date" means, with respect to any Debentures to
be redeemed under the Indenture, the date fixed for redemption under the
Indenture.

         "Debenture Tax Event" means a "Tax Event" as specified in Section 1.1
of the Indenture.

         "Debenture Trustee" means Wilmington Trust Company, a banking
corporation organized under the laws of the State of Delaware, and any
successor thereto, not in its individual capacity but solely as trustee under
the Indenture.

         "Debentures" means the aggregate principal amount of the Depositor's
7.25 % Convertible Deferrable Interest Junior Subordinated Debentures, issued
pursuant to the Indenture.

         "Definitive Preferred Securities Certificates" means the Preferred
Securities Certificates issued in certificated, fully registered form
(non-global) as provided in Section 503A.

         "Delaware Bank" has the meaning specified in the Preamble to this
Trust Agreement.

         "Delaware Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Delaware Code Sections 3801 et seq. as it may be amended from
time to time.

         "Delaware Trustee" means the commercial bank or trust company
identified as the "Property Trustee" in the Preamble to this Trust Agreement
solely in its capacity as Delaware trustee of the Trust formed and continued
hereunder and not in its individual capacity, or its successor in interest in
such capacity, or any successor trustee appointed as herein provided.

         "Depositor" has the meaning specified in the Preamble to this Trust
Agreement.

         "Distribution Date" has the meaning specified in Section 401(a).

         "Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 401(b).

         "DTC" means The Depository Trust Company.

         "Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

         (a)      the occurrence of a Debenture Event of Default; or

         (b)      default by the Trust in the payment of any Distribution when
it becomes due and payable, and continuation of such default for a period of 30
days; or

         (c)      default by the Trust in the payment of any Redemption Price
of any Trust Security when it becomes due and payable; or

         (d)      default in the performance, or breach, in any material
respect, of any covenant or warranty of the Trustees in this Trust Agreement
(other than a covenant or warranty a default in the performance of which or the
breach of which is dealt with in clause (b) or (c), above) and continuation of
such default or breach for a period of

                                     Page 8
<PAGE>

60 days after there has been given, by registered or certified mail, to the
defaulting Trustee or Trustees by the Holders of at least 25% in aggregate
Liquidation Amount of the Outstanding Preferred Securities a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder; or

         (e)      the occurrence of a Bankruptcy Event with respect to the
Property Trustee and the failure by the Depositor to appoint a successor
property Trustee within 60 days thereof.

         "Exchange Act" means the Securities Exchange Act of 1934, or any
successor statute, in each case as amended from time to time.

         "Expense Agreement" means the Agreement as to Expenses and Liabilities
between the Depositor and the Trust, substantially in the form attached as
Exhibit C, as amended from time to time.

         "Expiration Date" has the meaning specified in Section 901.

         "Extended Interest Payment Period" has the meaning specified in
Section 5.1 of the Indenture.

         "Global Preferred Securities Certificate" means a Preferred Securities
Certificate evidencing ownership of Global Preferred Securities.

         "Global Preferred Security" means a Preferred Security, the ownership
and transfers of which shall be made through book entries by a Clearing Agency
as described in Section 503A.

         "Guarantee" means the Preferred Securities Guarantee Agreement
executed and delivered by the Depositor, as guarantor, and Wilmington Trust
Company, as Preferred Guarantee Trustee, contemporaneously with the execution
and delivery of this Trust Agreement, for the benefit of the Holders of the
Preferred Securities, as amended from time to time.

         "Holders" means holders of the Preferred Securities or the Common
Securities of the Trust.

         "Indenture" means the Indenture, dated as of February 13, 2002 between
the Depositor and the Debenture Trustee, as trustee, as amended or supplemented
from time to time.

         "Investment Company Act," means the Investment Company Act of 1940, or
any successor statute, in each case as amended from time to time.

         "Investment Company Event" has the meaning specified in Section 1.1 of
the Indenture.

         "Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.

         "Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be contemporaneously redeemed in accordance with the
Indenture and the proceeds of which shall be used to pay the Redemption Price
of such Trust Securities; and (b) with respect to a distribution of Debentures
to Holders of Trust Securities in connection with a termination or liquidation
of the Trust, Debentures having a principal amount equal to the Liquidation
Amount of the Trust Securities of the Holder to whom such Debentures are
distributed. Each Debenture distributed pursuant to clause (b) above shall
carry with it accumulated interest in an amount equal to the accumulated and
unpaid interest then due on such Debentures.

         "Liquidation Amount" means the stated amount of Ten Dollars ($10) per
share of Preferred Security of the Trust, and Ten Dollars ($10.00) per share of
Common Security of the Trust.

                                     Page 9
<PAGE>

         "Liquidation Date" means the date on which Debentures are to be
distributed to Holders of Trust Securities in connection with a dissolution and
liquidation of the Trust pursuant to Section 904(a).

         "Liquidation Distribution" has the meaning specified in Section
904(d).

         "Majority in Liquidation Amount of the Outstanding Preferred
Securities" means, except as provided in the terms of the Preferred Securities
or, except as provided by the Trust Indenture Act, a vote by Holder(s) of
Preferred Securities, voting separately as a class, of more than 50% of the
Liquidation Amount of all Outstanding Preferred Securities.

         "Officers' Certificate" means a certificate signed by the Chairman of
the Board, President or a Vice President and by the Chief Financial Officer,
the Treasurer or an Assistant Treasurer or the Controller or an Assistant
Controller or the Secretary or an Assistant Secretary, of the Depositor, and
delivered to the appropriate Trustee. One of the officers signing an Officers'
Certificate given pursuant to Section 314(a)(4) of the Trust Indenture Act
shall be the principal executive, financial or accounting officer of the
Depositor. Any Officers' Certificate delivered with respect to compliance with
a condition or covenant provided for in this Trust Agreement shall include:

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

         (b)      a brief statement of the nature and scope of the examination
or investigation undertaken by each officer upon which the statements contained
in the certificate are based in rendering the Officers' Certificate;

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

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

         "Opinion of Counsel" means an opinion in writing of independent
outside legal counsel, who may be counsel for the Trust, the Property Trustee,
or the Depositor and who shall be reasonably acceptable to the Property
Trustee.

         "Original Trust Agreement" has the meaning specified in the Recitals
to this Trust Agreement.

         "Outstanding", when used with respect to Preferred Securities, means,
as of the date of determination, all Preferred Securities theretofore executed
and delivered under this Trust Agreement, except:

         (a)      Preferred Securities theretofore canceled by the Property
Trustee or delivered to the Property Trustee for cancellation;

         (b)      Preferred Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Property Trustee
or any Paying Agent for the Holders of such Preferred Securities; provided
that, if such Preferred Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Trust Agreement; and

         (c)      Preferred Securities which have been paid or in exchange for
or in lieu of which other Preferred Securities have been executed and delivered
pursuant to Sections 504, 505 and 511A; provided, however, that in determining
whether the Holders of the requisite Liquidation Amount of the Outstanding
Preferred Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Preferred Securities owned by the
Depositor, any Trustee, or any Affiliate of the Depositor or any Trustee shall
be disregarded and deemed not to be Outstanding, except that (i) in determining
whether any Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Preferred
Securities that such Trustee actually knows to be so owned shall be so
disregarded and (ii) the foregoing shall not apply at any time when all of the
outstanding Preferred Securities are owned by the Depositor, one or more of the
Trustees and/or any such Affiliate. Preferred Securities so owned which have
been pledged in good faith may be regarded as Outstanding if

                                    Page 10
<PAGE>

the pledgee establishes to the satisfaction of the Administrative Trustees the
pledgee's right so to act with respect to such Preferred Securities and that
the pledgee is not the Depositor, any Trustee, or any Affiliate of the
Depositor or any Trustee.

         "Owners" means each Person who is the beneficial owner of a beneficial
interest in a Global Preferred Security as reflected in the records of the
Clearing Agency or, if a Clearing agency participant is not the Owner, hen
reflected in the records of a Person maintaining an account with such Clearing
Agency (directly or indirectly, in accordance with the rules of such Clearing
Agency).

         "Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 509 and shall initially be the Property Trustee.

         "Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee with the Bank in its trust
department for the benefit of the Securityholders and established pursuant to
Section 301 in which all amounts paid in respect of the Debentures shall be
held and from which the Property Trustee shall make payments to the
Securityholders in accordance with Sections 401 and 402 or any other applicable
provisions hereof.

         "Person" means any individual, sole proprietorship, corporation,
partnership, joint venture, trust, limited liability company or corporation,
unincorporated organization or government or any agency or political
subdivision thereof.

         "Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $10 and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.

         "Preferred Securities Certificate", means a certificate evidencing
ownership of Preferred Securities, substantially in the form attached as
Exhibit D.

         "Prime Rate" or "Prime" means the prime rate as published in The Wall
Street Journal, and shall be adjusted daily. For days on which The Wall Street
Journal is not published, the Prime Rate shall be the prime rate that would
have been published in The Wall Street Journal if it had been published on such
day. In the event the Prime Rate shall cease to be published on a daily basis
by The Wall Street Journal or the method of its determination shall be
materially changed, then the Prime Rate shall be a comparable index rate
selected by the holders of a majority in principal amount of Debentures then
outstanding, provided that if the Debentures are then held by the Trust or a
trustee of the Trust, such selection shall require the prior written consent of
the holders of a majority in liquidation amount of Trust Securities of the
Trust.

         "Property Trustee" means the Person identified as the "Property
Trustee," in the preamble to this Trust Agreement solely in its capacity as
Property Trustee of the Trust and not in its individual capacity, or its
successor in interest in such capacity, or any successor property trustee
appointed as herein provided.

         "Redemption Date" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Debenture Redemption Date and the stated maturity
of the Debentures shall be a Redemption Date for a Like Amount of Trust
Securities.

         "Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date in an amount equal to the interest and
other sums (exclusive of principal) paid by the Depositor upon and in respect
of the concurrent redemption of a Like Amount of Debentures, allocated on a pro
rata basis (based on Liquidation Amounts) among the Trust Securities being
redeemed on the Redemption Date.

         "Relevant Trustee" shall have the meaning specified in Section 810.

         "Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 504.

                                    Page 11
<PAGE>

         "Securityholder" or "Holder" means a Person in whose name a Trust
Security or Securities is registered in the Securities Register; any such
Person is a beneficial owner within the meaning of the Delaware Business Trust
Act.

         "Trust" means Southern Community Capital Trust I, a Delaware business
trust continued hereby.

         "Trust Agreement" means this Amended and Restated Trust Agreement, as
the same may be modified, amended or supplemented in accordance with the
applicable provisions hereof, including all exhibits hereto, including, for all
purposes of this Trust Agreement and any such modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Trust Agreement and any such modification, amendment or
supplement, respectively.

         "Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, as in force at the date as of which this instrument was executed;
provided, however, that in the event the Trust Indenture Act of 1939, as
amended, is amended after such date, "Trust Indenture Act" means, to the extent
required by any such amendment, the Trust Indenture Act of 1939 as so amended.

         "Trust Property" means (a) the Debentures; (b) any cash on deposit in,
or owing to, the Payment 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 Property Trustee pursuant to the terms of this Trust
Agreement.

         "Trust Security" means any one of the Common Securities or the
Preferred Securities.

         "Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.

         "Trustees" means, collectively, the Property Trustee and the
Administrative Trustees.

         "Underwriting Agreement" means the Underwriting Agreement, dated as of
February 8, 2002, including exhibits, among the Trust, the Depositor and the
Underwriter named therein.

         "Underwriters' Over-Allotment Option" means the option, exercisable
within 30 days after the date of the prospectus, granted to the underwriters in
the offering to the public of Preferred Securities, to purchase up to
$2,250,000 in Liquidation Amount of additional Preferred Securities at the same
price per Preferred Security as paid for the other Preferred Securities issued
pursuant to the prospectus.

                                   ARTICLE II
                           ESTABLISHMENT OF THE TRUST

SECTION 201.      NAME.

         The Trust created and continued hereby shall be known as "Southern
Community Capital Trust I," as such name may be modified from time to time by
the Administrative Trustees following written notice to the Holders of Trust
Securities and the other Trustees, in which name the Trustees may engage in the
transactions contemplated hereby, make and execute contracts and other
instruments on behalf of the Trust and sue and be sued.

SECTION 202.      OFFICE OF THE PROPERTY TRUSTEE; PRINCIPAL PLACE OF BUSINESS.

         The address of the Property Trustee in the State of Delaware is Rodney
Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001,
Attention: Corporate Trust Administration, or such other address in the State
of Delaware as the Property Trustee may designate by written notice to the
Securityholders and the Depositor. The principal place of business of the
Property Trustee is in the State of Delaware. The principal executive office of
the Trust is c/o Southern Community Financial Corporation, 4701 Country Club
Road, Winston-Salem, North Carolina 27104.

                                    Page 12
<PAGE>

SECTION 203.      INITIAL CONTRIBUTION OF TRUST PROPERTY; ORGANIZATIONAL
EXPENSES.

         The Trustees acknowledge receipt in trust from the Depositor in
connection with the Original Trust Agreement of the sum of Ten Dollars ($10),
which constituted the initial Trust Property. The Depositor shall pay
organizational expenses of the Trust as they arise or shall, upon request of
any Trustee, promptly reimburse such Trustee for any such expenses paid by such
Trustee. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.

SECTION 204.      ISSUANCE OF THE PREFERRED SECURITIES.

         The Depositor, on behalf of the Trust and pursuant to the Original
Trust Agreement, executed and delivered the Underwriting Agreement.
Contemporaneously with the execution and delivery of this Trust Agreement, an
Administrative Trustee, on behalf of the Trust, shall execute, in accordance
with Section 502, and deliver Preferred Securities Certificates, registered in
the name of the Persons entitled thereto, in an aggregate amount of One Million
Five Hundred Thousand (1,500,000) shares of Preferred Securities having an
aggregate Liquidation Amount of Fifteen Million Dollars ($15,000,000) against
receipt of the aggregate purchase price of such Preferred Securities of Fifteen
Million Dollars ($15,000,000), which amount such Administrative Trustee shall
promptly deliver to the Property Trustee. In the event the underwriters
exercise their Underwriters' Over-Allotment Option and there is an Option
Closing Date (as such term is defined in the Underwriting Agreement), then an
Administrative Trustee, on behalf of the Trust, shall execute, in accordance
with Section 502, and deliver in accordance with the Underwriting Agreement,
additional Preferred Securities Certificates, registered in the name of the
Persons entitled thereto, in an aggregate amount of up to Two Hundred
Twenty-Five Thousand (225,000) shares of Preferred Securities having an
aggregate liquidation Amount of Two Million Two Hundred Fifty Thousand Dollars
($2,250,000) against receipt of the aggregate purchase price of such Preferred
Securities of Two Million Two Hundred Fifty Thousand Dollars ($2,250,000),
which amount such Administrative Trustee shall promptly deliver to the Property
Trustee.

SECTION 205.      ISSUANCE OF THE COMMON SECURITIES; SUBSCRIPTION AND PURCHASE
OF DEBENTURES.

         (a)      Contemporaneously with the execution and delivery of this
Trust Agreement, an Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 502 and deliver to the Depositor, Common
Securities Certificates, registered in the name of the Depositor in an
aggregate amount of Forty-Six Thousand Four Hundred (46,400) shares of Common
Securities having an aggregate Liquidation Amount of Four Hundred Sixty-Four
Thousand Dollars ($464,000) against payment by the Depositor of such amount,
which amount such Administrative Trustee shall promptly deliver to the Property
Trustee. Contemporaneously therewith, an Administrative Trustee on behalf of
the Trust, shall subscribe to and purchase from the Depositor, Debentures
registered in the name of the Property Trustee on behalf of the Trust and
having an aggregate principal amount equal to Fifteen Million Four Hundred
Sixty-Four Thousand Dollars ($15,464,000) (being the sum of the amounts
delivered to the Property Trustee pursuant to: (i) the second sentence of
Section 204; and (ii) the first sentence of Section 205(a)), and, in
satisfaction of the purchase price for such Debentures, the Property Trustee,
on behalf of the Trust, shall deliver to the Depositor the sum of Fifteen
Million Four Hundred Sixty-Four Thousand Dollars ($15,464,000).

         (b)      If the underwriters exercise the Option and there is an
Option Closing Date, then an Administrative Trustee, on behalf of the Trust,
shall execute in accordance with Section 502 and deliver to the Depositor,
Common Securities Certificates, registered in the name of the Depositor, in an
additional aggregate amount of Common Securities having an aggregate
Liquidation Amount of at least Seventy Thousand Dollars ($70,000) against
payment by the Depositor of such amount. Contemporaneously therewith, an
Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Depositor, additional Debentures, registered in the name of the Trust
and having an aggregate principal amount of up to Two Million Three Hundred
Twenty Thousand Dollars ($2,320,000), and, in satisfaction of the purchase
price of such Debentures, the Property Trustee, on behalf of the Trust, shall
deliver to the Depositor up to Two Million Three Hundred Twenty Thousand
Dollars ($2,320,000), such aggregate amount to be equal to the sum of the
amounts received from the Depositor pursuant to Section 205(b) and from one of
the Administrative Trustees pursuant to the last sentence of Section 204.

                                    Page 13
<PAGE>

SECTION 206.      DECLARATION OF TRUST.

         The exclusive purposes and functions of the Trust are (a) to issue and
sell Trust Securities and use the proceeds from such sale to acquire the
Debentures; and (b) to engage in those activities necessary, convenient or
incidental thereto. The Depositor hereby appoints the Trustees as trustees of
the Trust, to have all the rights, powers and duties to the extent set forth
herein, and the Trustees hereby accept such appointment. The Property Trustee
hereby declares that it shall hold the Trust Property in trust upon and subject
to the conditions set forth herein for the benefit of the Securityholders. The
Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Trust.

SECTION 207.      AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS.

         (a)      The Trustees shall conduct the affairs of the Trust in
accordance with the terms of this Trust Agreement. Subject to the limitations
set forth in paragraph (b) of this Section 207 and Article VIII hereof, and in
accordance with the following provisions (i) and (ii), the Administrative
Trustees shall have the authority to enter into all transactions and agreements
determined by the Trustees to be appropriate in exercising the authority,
express or implied, otherwise granted to the Trustees under this Trust
Agreement, and to perform all acts in furtherance thereof, including without
limitation, those acts described in (i) below:

                  (i)      As among the Trustees, each Administrative Trustee,
acting singly or together, shall have the power and authority to act on behalf
of the Trust with respect to the following matters:

                           (A)      the issuance and sale of the Trust
Securities and the compliance with the Underwriting Agreement, in connection
therewith;

                           (B)      to cause the Trust to enter into, and to
execute, deliver and perform on behalf of the Trust, the Expense Agreement,
Certificate Depository Agreement and such other agreements or documents as may
be necessary or desirable in connection with the purposes and function of the
Trust;

                           (C)      assisting in the registration of the
Preferred Securities under the Securities Act of 1933, where required, as
amended, and under state securities or blue sky laws and the qualification of
this Trust Agreement as a trust indenture under the Trust Indenture Act;

                           (D)      assisting in the registration or listing of
the Preferred Securities with DTC or upon such other trading facilities or
exchanges as shall be determined by the Depositor and the preparation and
filing of all periodic and other reports and other documents pursuant to the
foregoing;

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

                           (F)      the appointment of a Paying Agent,
authenticating agent and Securities Registrar in accordance with this Trust
Agreement;

                           (G)      to the extent provided in this Trust
Agreement, 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;

                           (H)      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 business trust under the laws
of the State of Delaware and of each other jurisdiction in which such existence
is necessary to protect the limited liability of the Holders of the Preferred
Securities or to enable the Trust to effect the purposes for which the Trust
was created; and

                                    Page 14
<PAGE>

                           (I)      the taking of any action incidental to the
foregoing as the Administrative Trustees may from time to time determine is
necessary or advisable to give effect to the terms of this Trust Agreement for
the benefit of the Securityholders (without consideration of the effect of any
such action on any particular Securityholder).

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

                           (A)      the establishment of the Payment 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 Payment Account;

                           (D)      the distribution of amounts owed to the
Securityholders in respect of the Trust Securities in accordance with the terms
of this Trust Agreement;

                           (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 Trust Securities and the Debentures to the
Securityholders in accordance with this Trust Agreement;

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

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

                           (I)      after an Event of Default, the taking of
any action incidental to the foregoing as the Property Trustee may from time to
time determine is necessary or advisable to give effect to the terms of this
Trust Agreement and protect and conserve the Trust Property for the benefit of
the Securityholders (without consideration of the effect of any such action on
any particular Securityholder);

                           (J)      registering transfers of the Trust
Securities in accordance with this Trust Agreement; and

                           (K)      except as otherwise provided in this
Section 207(a)(ii), the Property Trustee shall have none of the duties,
liabilities, powers or the authority of the Administrative Trustees set forth
in Section 207(a)(i) hereof.

         (b)      So long as this Trust Agreement remains in effect, the Trust
(or the Trustees acting on behalf of the Trust) shall not undertake any
business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, the Trustees shall not (i) acquire any
investments or engage in any activities not authorized by this Trust Agreement;
(ii) sell, assign, transfer, exchange, mortgage, pledge, setoff or otherwise
dispose of any of the Trust Property or interests therein, including to
Securityholders, except as expressly provided herein; (iii) take any action
that would cause the Trust to fail or cease to qualify as a "grantor trust" for
United States federal income tax purposes; (iv) incur any indebtedness for
borrowed money or issue any other debt; or (v) take or consent to any action
that would result in the placement of a Lien on any of the Trust Property. The
Administrative Trustees shall defend against 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 Securityholders in their capacity as
Securityholders.

         (c)      In connection with the issuance and sale of the Preferred
Securities, the Depositor 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 Depositor in furtherance of the following prior to the
date of this Trust Agreement are hereby ratified and confirmed in all
respects):

                                    Page 15
<PAGE>

                  (i)      any matters deemed necessary or appropriate for the
Trust Securities and the Debentures to qualify under all applicable federal and
state securities laws, including but not limited to, the preparation for filing
by the Trust with the Commission and the execution on behalf of the Trust of a
registration statement on Form 8-A or Form 10, as applicable, relating to the
registration of the Preferred Securities under the Exchange Act, including any
amendments thereto;

                  (ii)     the determination of the states in which to take
appropriate action to qualify or register for sale all or part of the Preferred
Securities and to do any and all such acts, other than actions which must be
taken by or on behalf of the Trust, and advise the Trustees of actions they
must take on behalf of the Trust, and prepare for execution and filing any
documents to be executed and filed by the Trust or on behalf of the Trust, as
the Depositor deems necessary or advisable in order to comply with the
applicable laws of any such States;

                  (iii)    the preparation for filing by the Trust and
execution on behalf of the Trust of an application to the Nasdaq National
Market or another national stock exchange or other organizations for listing of
any Preferred Securities and to file or cause an Administrative Trustee to file
thereafter with such exchange or organization such notifications and documents
as may be necessary from time to time;

                  (iv)     the negotiation of the terms of, and the execution
and delivery of, the Underwriting Agreement providing for the sale of, the
Preferred Securities; and

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

         (d)      Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust shall not be deemed to be
an "investment company" required to be registered under the Investment Company
Act, shall be classified as a "grantor trust" and not as an association taxable
as a corporation for United States federal income tax purposes and so that the
Debentures shall be treated as indebtedness of the Depositor for United States
federal income tax purposes. In connection therewith, subject to Section 1002,
the Depositor and the Administrative Trustees are authorized to take any
action, not inconsistent with applicable law or this Trust Agreement, that each
of the Depositor and the Administrative Trustees determines in their discretion
to be necessary or desirable for such purposes.

SECTION 208.      ASSETS OF TRUST.

         The assets of the Trust shall consist of the Trust Property.

SECTION 209.      TITLE TO TRUST PROPERTY.

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

                                  ARTICLE III
                                PAYMENT ACCOUNT

SECTION 301.      PAYMENT ACCOUNT.

         (a)      On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits and
withdrawals from the Payment Account in accordance with this Trust Agreement.
All monies and other property deposited or held from time to time in the
Payment Account shall be held by the Property Trustee in the Payment Account
for the exclusive benefit of the Securityholders and for distribution as herein
provided, including (and subject to) any priority of payments provided for
herein.

                                    Page 16
<PAGE>

         (b)      The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with respect to, the Debentures. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.

                                   ARTICLE IV
                           DISTRIBUTIONS; REDEMPTION

SECTION 401.      DISTRIBUTIONS.

         The Trust Securities represent undivided beneficial interests in the
Trust Property, and Distributions (including Additional Amounts) will be made
on the Trust Securities at the rate and on the dates that payments of interest
(including of Compounded Interest and interest on past due interest, as defined
under the Indenture, but excluding Additional Interest, as defined in the
Indenture) are made on the Debentures. Accordingly:

         (a)      Distributions on the Trust Securities shall be cumulative,
and shall accumulate whether or not there are funds of the Trust available for
the payment of Distributions. Distributions shall accumulate from the date of
issuance, and, except during any Extended Interest Payment Period with respect
to the Debentures, shall be payable quarterly in arrears on March 31, June 30,
September 30 and December 31 each year, commencing on March 31, 2002. If any
date on which a Distribution is otherwise payable on the Trust Securities is
not a Business Day, then the payment of such Distribution shall be made on the
next succeeding day that is a Business Day (and without any increase of
interest or other payment in respect of any such delay) except that, if such
Business Day is in the next succeeding calendar year, payment of such
Distribution shall be made on the immediately preceding Business Day (and
without any reduction of interest or any other payment in respect of any such
acceleration), in each case with the same force and effect as if made on such
date (each date on which distributions are payable in accordance with this
Section 401(a), a "Distribution Date").

         (b)      Assuming payments of interest on the Debentures are made when
due (and before giving effect to Additional Amounts, if applicable),
Distributions on the Trust Securities shall be payable at the Coupon Rate per
annum of the Liquidation Amount of the Trust Securities. The amount of
Distributions payable for any full period shall be computed on the basis of a
360-day year of twelve 30-day months. Any change in the Coupon Rate shall be
effective on the date of such change for purposes of calculating distributions
for any period. Subject to the last sentence in Section 401(a), the amount of
Distributions for any period shorter than a full quarterly period for which
Distributions are computed shall be computed on the basis of the actual number
of days elapsed in such period based on a 360-day year of twelve 30-day months.
During any Extended Interest Payment Period with respect to the Debentures,
Distributions on the Preferred Securities shall be deferred for a period equal
to the Extended Interest Payment Period and shall be payable to the Holders in
whose names the Trust Securities are registered in the Securities Register as
of 5:00 p.m., New York, New York time on the 15th day of the month in which the
Extended Interest Payment Period ends. The amount of Distributions payable for
any period shall include the Additional Amounts, if any.

         (c)      Distributions on the Trust Securities shall be made by the
Property Trustee solely from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand and
immediately available by 12:30 pm, on each Distribution Date in the Payment
Account for the payment of such Distributions.

         (d)      Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities on the relevant record date, which
shall be the 15th day of the month in which the Distribution is payable (the
"Relevant Record Date"). The Relevant Record Date shall be determined without
giving effect to the last sentence of Section 401(a).

SECTION 402.      REDEMPTION.

         (a)      On (i) each Debenture Redemption Date; (ii) the accelerated
maturity of the Debentures; or (iii) the stated maturity of the Debentures the
Trust shall be required to redeem a Like Amount of Trust Securities at the
Redemption Price.

                                    Page 17
<PAGE>

         (b)      Notice of redemption shall be given by the Property Trustee
in the name of and at the expense of the Trust by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date to each Holder of Trust Securities to be redeemed, at such Holder's
address appearing in the Securities Register. The Property Trustee shall have
no responsibility for the accuracy of any CUSIP number contained in such
notice. All notices of redemption shall state:

                  (i)      the Redemption Date;

                  (ii)     the Redemption Price;

                  (iii)    the CUSIP number (if any);

                  (iv)     if less than all the Outstanding Trust Securities
are to be redeemed, the identification and the aggregate Liquidation Amount of
the particular Trust Securities to be redeemed;

                  (v)      that, on the Redemption Date, the Redemption Price
shall become due and payable upon each such Trust Security to be redeemed and
that Distributions thereon shall cease to accumulate on and after said date
with respect to each such Trust Security, except as provided in Section 402(d);
and

                  (vi)     the place or places where the Trust Securities are
to be surrendered for the payment of the Redemption Price.

         (c)      The Trust Securities redeemed on each Redemption Date shall
be redeemed at the Redemption Price with the proceeds from the contemporaneous
redemption of Debentures. Redemptions of the Trust Securities shall be made and
the Redemption Price shall be payable on each Redemption Date only to the
extent that the Trust has immediately available funds then on hand and
available in the Payment Account for the payment of such Redemption Price.

         (d)      If the Property Trustee gives a notice of redemption in
respect of any Preferred Securities, then, by 12:00 noon., New York, New York
time, on the Redemption Date, subject to Section 402(c), the Property Trustee,
subject to Section 402(c), shall, with respect to Preferred Securities held in
global form, deposit with the Clearing Agency for such Preferred Securities, to
the extent available therefor, funds sufficient to pay the applicable
Redemption Price and will give such Clearing Agency irrevocable instructions
and authority to pay the Redemption Price to the Holders of the Preferred
Securities. With respect to Trust Securities that are not held in global form,
the Property Trustee, subject to Section 402(c), shall deposit with the Paying
Agent funds sufficient to pay the applicable Redemption Price and shall give
the Paying Agent irrevocable instructions and authority to pay the Redemption
Price to the record holders thereof upon surrender of their Preferred
Securities Certificates. Notwithstanding the foregoing, Distributions payable
on or prior to the Redemption Date for any Trust Securities called for
redemption shall be payable to the Holders of such Trust Securities as they
appear on the Securities Register for the Trust Securities on the Relevant
Record Dates for the related Distribution Dates. If notice of redemption shall
have been given and funds deposited as required, then upon the date of such
deposit, all rights of Securityholders holding Trust Securities so called for
redemption shall cease, except (i) the right of such Securityholders to receive
the Redemption Price, but without interest, (ii) the right of the
Securityholders to cause the Conversion Agent to convert the Trust Securities,
(iii) such Trust Securities shall cease to be Outstanding, (iv) the Clearing
Agency for the Preferred Securities or its nominee, as the registered Holder of
the Global Preferred Securities Certificate, shall receive a registered global
certificate or certificates representing the Debentures to be delivered upon
such distribution with respect to Preferred Securities held by the Clearing
Agency or its nominee, and (v) any Trust Securities Certificates not held by
the Clearing Agency for the Preferred Securities or its nominee as specified in
clause (iv) above will be deemed to represent Debentures having a principal
amount equal to the stated Liquidation Amount of the Trust Securities
represented thereby and bearing accrued and unpaid interest in an amount equal
to the accumulated and unpaid Distributions on such Trust Securities until such
certificates are presented to the Securities Registrar for transfer or
reissuance. In the event that any date on which any Redemption Price is payable
is not a Business Day, then payment of the Redemption Price payable on such
date shall be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such

                                    Page 18
<PAGE>

delay) except that, if such Business Day is in the next succeeding calendar
year, such payment shall be made on the immediately preceding Business Day (and
without any reduction of interest or any other payment in respect of any such
acceleration), in each case with the same force and effect as if made on such
date. In the event that payment of the Redemption Price in respect of any Trust
Securities called for redemption is improperly withheld or refused and not paid
either by the Trust or by the Depositor pursuant to the Guarantee,
Distributions on such Trust Securities shall continue to accumulate, at the
then applicable rate, from the Redemption Date originally established by the
Trust for such Trust Securities to the date such Redemption Price is actually
paid, in which case the actual payment date shall be the date fixed for
redemption for purposes of calculating the Redemption Price, and for periods
after the redemption Date originally established, the provisions of the third
sentence of this paragraph (d) shall cease to apply.

         (e)      Payment of the Redemption Price on the Trust Securities shall
be made to the record holders thereof as they appear on the Securities Register
for the Trust Securities on the relevant record date for payment of the
Redemption Price of the Trust Securities, which shall be the date 15 days prior
to the relevant Redemption Date.

         (f)      Subject to Section 403(a), if less than all the Outstanding
Trust Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Trust Securities to be redeemed shall be allocated on a
pro rata basis (based on Liquidation Amounts) among the Common Securities and
the Preferred Securities. The particular Preferred Securities to be redeemed
shall be selected not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Preferred Securities not previously
called for redemption, by such method (including, without limitation, by lot)
as the Property Trustee shall deem fair and appropriate and which may provide
for the selection for redemption of portions (equal to Ten Dollars ($10) or an
integral multiple of $10 in excess thereof), of the Liquidation Amount of
Preferred Securities of a denomination larger than Ten Dollars ($10). The
Property Trustee shall promptly notify the Securities Registrar in writing of
the Preferred Securities selected for redemption and, in the case of any
Preferred Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For all purposes of this Trust Agreement, unless the
context otherwise requires, all provisions relating to the redemption of
Preferred Securities shall relate, in the case of any Preferred Securities
redeemed or to be redeemed only in part, to the portion of the Liquidation
Amount of Preferred Securities which has been or is to be redeemed.

SECTION 402A.     CONVERSION.

         The Securityholders shall have the right at any time on or after
February 13, 2002 and prior to 5:00 pm, New York, New York time on the Business
Day immediately preceding the date of repayment of such Trust Securities,
whether at maturity or upon redemption (either at the option of the Depositor
or pursuant to a Tax Event, an Investment Company Event or a Capital Treatment
Event), at their option, to cause the Conversion Agent to convert Trust
Securities, on behalf of the converting Holders, into shares of the Common
Stock in the manner described herein on and subject to the following terms and
conditions:

         (a)      The Trust Securities shall be convertible at the office of
the Conversion Agent into fully paid and nonassessable shares of Common Stock
pursuant to the Holder's direction to the Conversion Agent to exchange such
Trust Securities for a portion of the Debentures theretofore held by the Trust
on the basis of one Trust Security per $10 principal amount of Debentures, and
immediately convert such amount of Debentures into fully paid and nonassessable
shares of Common Stock of the Depositor at an initial conversion rate of 1.153
shares of Common Stock per $10 principal amount of Debentures (which is
equivalent to an initial conversion price of $8.67 per share of Common Stock),
subject to certain adjustments set forth in the terms of the Debentures (as so
adjusted, the "Conversion Ratio"). The number of shares issuable upon
conversion of the principal amount of Debentures shall be determined by
dividing such principal amount by ten (10) and multiplying the quotient so
obtained by the Conversion Ratio.

         (b)      In order to convert Trust Securities into Common Stock, the
Holder must submit to the Conversion Agent an irrevocable request to convert
Trust Securities on behalf of such Holder (the "Conversion Request"), together,
if the Trust Securities are in certificated form, with such Trust Security
Certificates. The Conversion Request shall (i) set forth the number of Trust
Securities to be converted and the name or names, if other than the Holder, in
which the shares of Common Stock should be issued, and (ii) direct the
Conversion Agent (A) to exchange such Trust Securities for a portion of the
Debentures held by the Trust (at the rate of exchange specified in

                                    Page 19
<PAGE>

Section 402A(a) hereof), and (B) to immediately convert such Debentures on
behalf of such Holder into Common Stock (at the Conversion Ratio specified in
Section 402A(a) hereof. The Conversion Agent shall notify the Trust of the
Holder's election to exchange Trust Securities for a portion of the Debentures
held by the Trust and the Property Trustee on behalf of the Trust shall, upon
receipt of such notice, deliver to the Conversion Agent the appropriate
principal amount of Debentures for exchange in accordance with this Section
402A. The Conversion Agent shall thereupon notify the Depositor of the Holder's
election to convert such Debentures into shares of Common Stock.

         (c)      Accrued Distributions shall not be paid on Preferred
Securities that are converted into Common Stock, nor shall any payment,
allowance or adjustment be made for accumulated and unpaid Distributions,
whether or not in arrears, on converted Preferred Securities, except that if
any Preferred Security is converted (i) on or after a record date for payment
of Distributions thereon and prior to the related Distribution Date, the amount
of the Distributions payable on the related Distribution Date with respect to
such Preferred Security shall be paid by the converting Holder to the Trust and
the Distributions payable on the related Distribution Date with respect to such
Preferred Security shall be distributed to the Holder on such record date,
despite such conversion, and (ii) during an Extended Interest Payment Period
and after the Property Trustee mails a notice of redemption with respect to the
Preferred Securities that are to be converted, accrued and unpaid Distributions
through the Redemption Date of the Debentures shall be distributed to the
Holder who converts such Preferred Securities, which Distribution shall be made
on the Redemption Date fixed for redemption. Except as provided above, neither
the Trust nor the Depositor shall make, or be required to make, any payment,
allowance or adjustment upon any conversion on account of any accumulated and
unpaid Distributions accrued on the Trust Securities (including any Additional
Amount) surrendered for conversion, or on account of any accumulated and unpaid
dividends, if any, on the shares of Common Stock issued upon such conversion.
The Depositor shall make no payment or allowance for distributions on the
shares of Common Stock issued upon such conversion, except to the extent that
such shares of Common Stock are held of record on the record date for any such
distributions and except as provided in Section 4.9 of the Indenture. Trust
Securities shall be deemed to have been converted immediately prior to 5:00
p.m., New York, New York time on the day on which a Conversion Request relating
to such Trust Securities is received by the Trust in accordance with the
foregoing provisions of this Section 402A (the "Conversion Date"). The Person
or Persons entitled to receive the Common Stock issuable upon conversion of the
Debentures shall be treated for all purposes as the record holder or holders of
such Common Stock at such time. As promptly as practicable on or after the
Conversion Date, the Depositor shall issue and deliver at the office of the
Conversion Agent a certificate or certificates for the number of full shares of
Common Stock issuable upon such conversion, together with the cash payment, if
any, in lieu of any fraction of any share to the Person or Persons entitled to
receive the same as provided in Section 402A(e) hereof, unless otherwise
directed by the Holder in the Conversion Request, and the Conversion Agent
shall distribute such certificate or certificates to such Person or Persons.

         (d)      Each Holder of a Trust Security by his acceptance thereof
appoints the Bank (the "Conversion Agent") for the purpose of effecting the
conversion of Trust Securities in accordance with this Section 402A. In
effecting the conversion and transactions described in this Section 402A, the
Conversion Agent shall be acting as agent of the Securityholders directing it
to effect such conversion transactions. The Conversion Agent is hereby
authorized (i) to exchange Trust Securities from time to time for Debentures
held by the Trust in connection with the conversion of such Trust Securities
with this Section 402A, and (ii) to convert all or a portion of the Debentures
into Common Stock and thereupon to deliver such shares of Common Stock in
accordance with the provisions of this Section 402A and to deliver to the Trust
a new Debenture or Debentures for any resulting unconverted principal amount.

         (e)      No fractional shares of Common Stock shall be issued as a
result of conversion, but in lieu thereof, such fractional interest shall be
paid in cash (based on the last reported sale price of the common Stock on the
Conversion Date) by the Depositor to the Trust, which in turn shall make such
payment to the Holder or Holders of Trust Securities so converted.

         (f)      The Depositor shall at all times reserve and keep available
out of its authorized and unissued Common Stock, solely for issuance upon the
conversion of the Debentures, free from any preemptive or other similar rights,
such number of shares of Common Stock as shall from time to time be issuable
upon the conversion of all of the Debentures then outstanding. Notwithstanding
the foregoing, the Depositor shall be entitled to deliver, upon conversion of
Debentures, shares of Common Stock reacquired and held in the treasury of the
Depositor (in lieu of the issuance of authorized and unissued shares of Common
Stock), so long as any such treasury shares are free and

                                    Page 20
<PAGE>

clear of all liens, charges, security interests or encumbrances. Any shares of
Common Stock issued upon conversion of the Debentures shall be duly authorized,
validly issued, fully paid and nonassessable. The Trust shall deliver the
shares of Common Stock of the Depositor received upon conversion of the
Debentures to the converting Holder free and clear of all liens, charges,
security interests and encumbrances, except for United States withholding
taxes. Each of the Depositor and the Trust shall prepare and shall use its best
efforts to obtain and keep in force such governmental or regulatory permits or
other authorizations as may be required by law, and shall comply with all
applicable requirements as to registration or qualification of the Common Stock
(and all requirements to list the Common Stock issuable upon conversion of
Debentures that are at the time applicable), in order to enable the Depositor
to lawfully issue Common Stock to the Trust upon conversion of the Debentures
and the Trust to lawfully deliver the Common Stock to each Holder upon
conversion of the Trust Securities.

         (g)      The Depositor shall pay any and all taxes that may be payable
in respect of the issue or delivery of shares of Common Stock on conversion of
Debentures and the delivery of the shares of Common Stock by the Trust upon
conversion of the Trust Securities. The Depositor shall not, however, be
required to pay any tax that may be payable in respect of any transfer involved
in the issue and delivery of shares of Common Stock in a name other than that
in which the Trust Securities so converted were registered, and no such issue
or deliver shall be made unless and until the person requesting such issue has
paid to the Trust the amount of any such tax or has established to the
satisfaction of the Trust that has been paid.

         (h)      Nothing in this Section 402A shall limit the requirements of
the Trust to withhold taxes pursuant to the terms of the Trust Securities or as
set forth in this Trust Agreement or otherwise require the Property Trustee or
the Trust to pay any amount on account of such withholdings.

SECTION 403.      SUBORDINATION OF COMMON SECURITIES.

         (a)      Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made, subject to Section 402(f), pro rata among the Common
Securities and the Preferred Securities based on the Liquidation Amount of the
Trust Securities, provided, however, that if on any Distribution Date or
Redemption Date any Event of Default resulting from a Debenture Event of
Default shall have occurred and be continuing, no payment of any Distribution
(including Additional Amounts, if applicable) on, or Redemption Price of, any
Common Security, and no other payment on account of the redemption, liquidation
or other acquisition of Common Securities, shall be made unless payment in full
in cash of all accumulated and unpaid Distributions (including Additional
Amounts, if applicable) on all Outstanding Preferred Securities for all
Distribution periods terminating on or prior thereto, or in the case of payment
of the Redemption Price the full amount of such Redemption Price on all
Outstanding Preferred Securities then called for redemption, shall have been
made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on, or the
Redemption Price of, Preferred Securities then due and payable.

         (b)      In the case of the occurrence of any Event of Default
resulting from a Debenture Event of Default, the Holder of Common Securities
shall be deemed to have waived any right to act with respect to any such Event
of Default under this Trust Agreement until the effect of all such Debenture
Events of Default with respect to the Preferred Securities shall have been
cured, waived or otherwise eliminated. Until any such Event of Default under
this Trust Agreement resulting from a Debenture Event of Default shall have
been so cured, waived or otherwise eliminated, the Property Trustee shall act
solely on behalf of the Holders of the Preferred Securities and not the Holder
of the Common Securities, and only the Holders of the Preferred Securities
shall have the right to direct the Property Trustee to act on their behalf.

SECTION 404.      PAYMENT PROCEDURES.

         Payments of Distributions (including Additional Amounts, if
applicable) in respect of the Preferred Securities shall be made by check
mailed to the address of the Person entitled thereto as such address shall
appear on the Securities Register, or if any Preferred Securities are held by a
Clearing Agency, such Distributions shall be made to the Clearing Agency in
immediately available funds, which will credit the relevant accounts on the
applicable Distribution Dates. Payments in respect of the Common Securities
shall be made in such manner as shall be mutually agreed between the Property
Trustee and the Common Securityholder.

                                    Page 21
<PAGE>

SECTION 405.        TAX RETURNS AND REPORTS.

         The Administrative Trustees shall prepare (or cause to be prepared),
at the Depositor's expense, and file all United States federal, state and local
tax and information returns and reports required to be filed by or in respect
of the Trust. In this regard, the Administrative Trustees shall (a) prepare and
file (or cause to be prepared and filed) the appropriate Internal Revenue
Service Form required to be filed in respect of the Trust in each taxable year
of the Trust; and (b) prepare and furnish (or cause to be prepared and
furnished) to each Securityholder the appropriate Internal Revenue Service form
required to be furnished to such Securityholder or the information required to
be provided on such form. The Administrative Trustees shall provide the
Depositor with a copy of all such returns and reports promptly after such
filing or furnishing. The Property Trustee shall comply with United States
federal withholding and backup withholding tax laws and information reporting
requirements with respect to any payments to Securityholders under the Trust
Securities.

SECTION 406.      PAYMENT OF TAXES, DUTIES, ETC. OF THE TRUST.

         Upon receipt under the Debentures of Additional Interest, the Property
Trustee, at the written direction of an Administrative Trustee or the
Depositor, shall promptly pay any taxes, duties or governmental charges of
whatsoever nature (other than withholding taxes) imposed on the Trust by the
United States or any other taxing authority.

SECTION 407.      PAYMENTS UNDER INDENTURE.

         Any amount payable hereunder to any Holder of Preferred Securities
shall be reduced by the amount of any corresponding payment such Holder (or any
related Owner) has directly received under the Indenture pursuant to Section
8.8 thereof and 512(b) hereof and under the Guarantee.

SECTION 408.      TAXES; WITHHOLDING.

         The Property Trustee agrees, to the extent required by the Code, and
applicable federal regulations thereunder, to withhold from each payment due
hereunder or under any Trust Securities, United States withholding taxes at the
appropriate rate, and, on a timely basis, to deposit such amounts with an
authorized depository and make such returns, filings and other reports in
connection therewith as are required by the Code. In the event that any
withholding tax is imposed on a payment to a Securityholder, such tax shall
reduce the amount otherwise distributable to the Securityholder in accordance
with this Section. Any Securityholder which is organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date such
Securityholder becomes a Securityholder, (a) so notify the Property Trustee,
(b) (i) provide the Property Trustee with Internal Revenue Service form 1001,
4224, 8709 or W-8, as appropriate, or (ii) notify the Property Trustee that it
is not entitled to an exemption from United States withholding tax or a
reduction in the rate thereof on payments of interest. Any such Securityholder
agrees by its acceptance of a Trust Security, on an ongoing basis, to provide
like certification for each taxable year and to notify the Property Trustee as
specified in clauses (a) and (b) above. The Property Trustee shall be fully
protected in relying upon, and each Securityholder by its acceptance of a
Security agrees to indemnify and hold the Property Trustee harmless against all
claims or liability of any kind arising in connection with or related to the
Property Trustee's reliance upon any documents, forms or information provided
by any Securityholder to the Property Trustee. In addition, if the Property
Trustee has not withheld taxes on any payment made to any Securityholder, and
the Property Trustee is subsequently required to remit to any taxing authority
any such amount not withheld, such Securityholder shall return such amount to
the Property Trustee upon written demand by the Property Trustee. The Property
Trustee shall be liable only for direct (but not consequential) damages to any
Securityholder due to the Property Trustee's violation of the Code and only to
the extent such liability is caused by the Property Trustee's gross negligence
or willful misconduct.

                                    Page 22
<PAGE>

                                   ARTICLE V
                         TRUST SECURITIES CERTIFICATES

SECTION 501.      INITIAL OWNERSHIP.

         Upon the creation of the Trust and the contribution by the Depositor
pursuant to Section 203 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are outstanding, the Depositor shall
be the sole beneficial owner of the Trust.

SECTION 502.      THE TRUST SECURITIES CERTIFICATES.

         (a)      The Preferred Securities Certificates shall be issued in
minimum denominations of Ten Dollars ($10) Liquidation Amount and integral
multiples of Ten Dollars ($10) in excess thereof, and the Common Securities
Certificates shall be issued in denominations of Ten Dollars ($10) Liquidation
Amount and integral multiples thereof. The Trust Securities Certificates shall
be executed on behalf of the Trust by manual, facsimile or imprinted signature
of at least one Administrative Trustee and the Property Trustee shall
authenticate and register the Preferred Securities Certificates. Trust
Securities Certificates bearing the signatures of individuals who were, at the
time when such signatures shall have been affixed, authorized to sign on behalf
of the Trust, shall be validly issued and entitled to the benefits of this
Trust Agreement, notwithstanding that such individuals or any of them shall
have ceased to be so authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery of such Trust
Securities Certificates. A transferee of a Trust Securities Certificate shall
become a Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Sections 504 and
511A.

         (b)      Upon their original issuance, Preferred Securities
Certificates shall be issued in the form of one or more fully registered Global
Preferred Securities Certificates which will be deposited with or on behalf of
the Depository and registered in the name of the Depository or Depository's
nominee. Unless and until it is exchangeable in whole or in part for the
Preferred Securities in definitive form, a global security may not be
transferred except as a whole by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
depository or by the Depository to any such nominee to a successor of such
Depository on a nominee of such successor.

         (c)      A single Common Securities Certificate representing the
Common Securities shall be issued to the Depositor in the form of a definitive
Common Securities Certificate.

SECTION 503.      EXECUTION AND DELIVERY OF TRUST SECURITIES CERTIFICATES.

         (a)      On the Closing Date and on the date on which the Underwriters
exercise the Underwriters' Over-Allotment Option (the "Option Closing Date"),
the Administrative Trustees shall cause Trust Securities Certificates, in an
aggregate Liquidation Amount as provided in Sections 204 and 205, to be
executed by manual, facsimile or imprinted signature on behalf of the Trust by
at least one of the Administrative Trustees and delivered to the Property
Trustee and upon such delivery, the Property Trustee shall authenticate and
register the Preferred Securities Certificates and make available for delivery
such Preferred Securities Certificates upon the written order of the Depositor,
executed by its Chairman of the Board, or President or any Vice President and
the Chief Financial Officer, Treasurer or an Assistant Treasurer or Secretary
or Assistant Secretary without further corporate action by the Depositor, in
authorized denominations.

         (b)      A Preferred Securities Certificate shall not be valid until
authenticated by the manual signature of an authorized signatory of the
Property Trustee in substantially the form of Exhibit E attached hereto. The
signature shall be conclusive evidence that the Preferred Securities
Certificate has been authenticated under this Trust Agreement. Each Preferred
Security Certificate shall be dated the date of its authentication.

         Upon the written order of the Trust signed by one of the
Administrative Trustees, the Property Trustee shall authenticate and make
available for delivery the Preferred Securities Certificates.

                                    Page 23
<PAGE>

         The Property Trustee may appoint an Authenticating Agent acceptable to
the Trust to authenticate the Preferred Securities. An Authenticating Agent may
authenticate the Preferred Securities whenever the Property Trustee may do so.
Each reference in this Trust Agreement to authentication by the Property
Trustee includes authentication by such agent. An Authenticating Agent has the
same rights as the Property Trustee to deal with the Company or the Trust.

SECTION 503A.     GLOBAL PREFERRED SECURITIES.

         (a)      Each Global Preferred Security issued under this Trust
Agreement shall be registered in the name of the Clearing Agency designated by
the Depositor for the related Global Preferred Securities or a nominee thereof
and delivered to such Clearing Agency or a nominee thereof or custodian
therefor.

         (b)      Notwithstanding any other provision in this Trust Agreement,
no Global Preferred Securities may be exchanged in whole or in part for
Preferred Securities registered, and no transfer of Global Preferred Securities
in whole or in part may be registered, in the name of any Person other than as
set forth in Section 502(b) unless: (i) the Clearing Agency advises the
Property Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities with respect to the Global
Preferred Securities, and the Administrative Trustees are unable to locate a
qualified successor; (ii) the Trust at its option advises the Clearing Agency
in writing that it elects to eliminate the global system through the Clearing
Agency; (iii) after the occurrence of a Debenture Event of Default in the
circumstances described in Section 511A(a); or (iv) pursuant to the following
sentence. All or any portion of a Global Preferred Security may be exchanged
for a Preferred Security that has a like aggregate principal amount and is not
a Global Preferred Security upon 20 days' prior written request made by the
Clearing Agency or its authorized representative to the Property Trustee;
provided, however that no Definitive Preferred Security Certificate shall be
issued in an amount representing less than $10 in aggregate Liquidation Amount
of Preferred Securities. Upon the occurrence of any event specified in clause
(i), (ii) or (iii) above, the Administrative Trustees shall notify the Clearing
Agency and the Clearing Agency shall notify all Owners of beneficial interests
in Global Preferred Securities, the Property Trustee and the Administrative
Trustees of the occurrence of such event and of the availability of the
Definitive Preferred Security Certificate to such Owners requesting the same;
provided, however, that no Definitive Preferred Security Certificate shall be
issued in an amount representing less than $10 in aggregate Liquidation Amount
of Preferred Securities. Upon surrender to the Administrative Trustees of the
typewritten Preferred Securities Certificate or certificates representing the
Global Preferred Securities held by the Clearing Agency, accompanied by
registration instructions, the Administrative Trustees, or any one of them,
shall execute Definitive Preferred Securities Certificates in accordance with
the instructions of the Clearing Agency. Neither the Securities Registrar nor
the Trustees shall be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of a Definitive Preferred Securities
Certificate, the Trustees shall recognize the Holder of the Definitive
Preferred Securities Certificate as a Securityholder. Definitive Preferred
Securities Certificates shall be printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Administrative
Trustees, as evidenced by the execution thereof by the Administrative Trustees
or any one of them.

         (c)      If any Global Preferred Security is to be exchanged for
Definitive Preferred Securities Certificates or cancelled in part, or if
Definitive Preferred Securities Certificates are to be exchanged in whole or in
part for a Global Preferred Security, then either: (i) such Global Preferred
Security shall be so surrendered for exchange or cancellation as provided in
this Article V; or (ii) the aggregate Liquidation Amount represented by such
Global Preferred Security shall be reduced, subject to Section 502, or
increased, by an amount equal to the Liquidation Amount represented by that
portion of the Global Preferred Security to be so exchanged or cancelled, or
equal to the Liquidation Amount represented by such Definitive Preferred
Securities Certificates to be so exchanged for beneficial interests in the
Global Preferred Security represented thereby, as the case may be, by means of
an appropriate adjustment made on the records of the Securities Registrar,
whereupon the Property Trustee, in accordance with the Applicable Procedures,
shall instruct the Clearing Agency or its authorized representative to make a
corresponding adjustment to its records. Upon surrender to the Administrative
Trustees or the Securities Registrar of the Global Preferred Security by the
Clearing Agency, accompanied by registration instructions, the Administrative
Trustees, or any one of them, shall execute the Definitive Preferred Securities
Certificates in accordance with the instructions of the Clearing Agency and
Section 502 hereof; provided, however, that no Definitive Preferred Securities
Certificates shall be issued in an amount representing less than $10 in
aggregate Liquidation Amount of Preferred Securities. None of the Securities
Registrar, the Property Trustee or the

                                    Page 24
<PAGE>

Administrative Trustees shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in relying
on, such instructions. Upon the issuance of Definitive Preferred Securities
Certificates, the Property Trustee and Administrative Trustees shall recognize
the Holders of the Definitive Preferred Securities Certificates as
Securityholders. The Definitive Preferred Securities Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by the
execution thereof by the Administrative Trustees or any one of them.

         (d)      Every Preferred Security executed and delivered upon
registration of, transfer of, or in exchange for or in lieu of, a Global
Preferred Security or any portion thereof, whether pursuant to this Article V
or Article IV or otherwise, shall be executed and delivered in the form of, and
shall be, a Global Preferred Security, unless such Preferred Security is
registered in the name of a Person other than the Clearing Agency for such
Global Preferred Security or a nominee thereof.

         (e)      The Clearing Agency or its nominee, as registered owner of a
Global Preferred Security, shall be the Holder of such Global Preferred
Security for all purposes under this Trust Agreement and the Global Preferred
Security, and Owners with respect to a Global Preferred Security shall hold
such interests pursuant to the Applicable Procedures. The Securities Registrar
and the Trustees shall be entitled to deal with the Clearing Agency for all
purposes of this Trust Agreement relating to the Global Preferred Securities
(including the payment of the Liquidation Amount of and Distributions on the
beneficial interests in Global Preferred Securities represented thereby and the
giving of instructions or directions to Owners of Global Preferred Securities
represented thereby) as the sole Holder of the Global Preferred Securities
represented thereby and shall have no obligations to the Owners thereof.
Neither the Property Trustee nor the Securities Registrar shall have any
liability in respect of any transfers effected by the Clearing Agency.

         The rights of the Owners of the Global Preferred Securities shall be
exercised only through the Clearing Agency and shall be limited to those
established by law, the Applicable Procedures and agreements between such
Owners and the Clearing Agency and/or the Clearing Agency Participants.
Pursuant to the Certificate Depository Agreement, unless and until Definitive
Preferred Securities Certificates are issued pursuant hereto, the Clearing
Agency will make global transfers among the Clearing Agency Participants and
receive and transmit payments on the Preferred Securities to such Clearing
Agency Participants. Not in limitation of the other provisions herein
contained, the Property Trustee is authorized and empowered hereby to execute
the Certificate Depositary Agreement.

SECTION 504.      REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES CERTIFICATES.

         (a)      The Property Trustee shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 508, a register or registers
for the purpose of registering Trust Securities Certificates and transfers and
exchanges of Preferred Securities Certificates (herein referred to as the
"Securities Register") in which the registrar and transfer agent (the
"Securities Registrar"), subject to such reasonable regulations as it may
prescribe, shall provide for the registration of Preferred Securities
Certificates and Common Securities Certificates (subject to Section 510 in the
case of the Common Securities Certificates) and registration of transfers and
exchanges of Preferred Securities Certificates as herein provided. The Property
Trustee shall be the initial Securities Registrar.

         (b)      Upon surrender for registration of transfer of any Preferred
Securities Certificate at the office or agency maintained pursuant to Section
508, the Administrative Trustees or any one of them shall execute and the
Property Trustee shall authenticate and make available for delivery, in the
name of the designated transferee or transferees, one or more new Preferred
Securities Certificates in authorized denominations of a like aggregate
Liquidation Amount dated the date of execution by such Administrative Trustee
or Trustees. The Securities Registrar shall not be required to register the
transfer of any Preferred Securities that have been called for redemption. At
the option of a Holder, Preferred Securities Certificates may be exchanged for
other Preferred Securities Certificates in authorized denominations of the same
class and of a like aggregate Liquidation Amount upon surrender of the
Preferred Securities Certificates to be exchanged at the office or agency
maintained pursuant to Section 508.

                                    Page 25
<PAGE>

         (c)      Every Preferred Securities Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to the Property Trustee and
the Securities Registrar duly executed by the Holder or his attorney duly
authorized in writing. Each Preferred Securities Certificate surrendered for
registration of transfer or exchange shall be canceled and subsequently
disposed of by the Property Trustee in accordance with its customary practice.
The Trust shall not be required to (i) issue, register the transfer of, or
exchange any Preferred Securities during a period beginning at the opening of
business 15 calendar days before the date of mailing of a notice of redemption
of any Preferred Securities called for redemption and ending at 5:00 p.m., New
York, New York time on the day of such mailing; or (ii) register the transfer
of or exchange of any Preferred Securities so selected for redemption, in whole
or in part, except the unredeemed portion of any such Preferred Securities
being redeemed in part.

         (d)      No service charge shall be made for any registration of
transfer or exchange of Preferred Securities Certificates, but the Securities
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Preferred Securities Certificates.

         (e)      Preferred Securities may only be transferred, in whole or in
part, in accordance with the terms and conditions set forth in this Trust
Agreement. To the fullest extent permitted by law, any transfer or purported
transfer of any Preferred Security not made in accordance with this Trust
Agreement shall be null and void. Notwithstanding any other provisions of this
Trust Agreement, transfers and exchanges of Preferred Securities and beneficial
interests in Global Securities, shall be made only in accordance with the
following:

                  (i)      Subject to Section 503A of this Trust Agreement, a
Preferred Security that is not a Global Preferred Security may be transferred,
in whole or in part, to a Person who takes delivery in the form of another
Preferred Security that is not a Global Security as provided in Section 504(a)
hereof;

                  (ii)     Subject to Section 503A of this Trust Agreement and
this Section 504, Preferred Securities shall be freely transferable;

                  (iii)    A beneficial interest in a Global Preferred Security
may be exchanged for a Preferred Security that is not a Global Preferred
Security as provided in Section 503A hereof.

SECTION 505.      MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES.

         If (a) any mutilated Trust Securities Certificate shall be surrendered
to the Securities Registrar, or if the Securities Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Securities Certificate, and (b) there shall be delivered to the Securities
Registrar, the Administrative Trustees and the Property Trustee such security
or indemnity as may be required by them to save each of them harmless, then in
the absence of notice that such Trust Securities Certificate shall have been
acquired by a bona fide purchaser, the Administrative Trustees, or any one of
them, on behalf of the Trust shall execute by manual, facsimile or imprinted
signature and the Property Trustee in the case of a Preferred Securities
Certificate shall authenticate and make available for delivery, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Trust Securities
Certificate, a new Trust Securities Certificate of like class, tenor and
denomination. In connection with the issuance of any new Trust Securities
Certificate under this Section 505, the Administrative Trustees or the
Securities Registrar 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 Trust Securities Certificate issued pursuant to this Section 505
shall constitute conclusive evidence of an undivided beneficial interest in the
assets of the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Trust Securities Certificate shall be found at any time.

SECTION 506.      PERSONS DEEMED SECURITYHOLDERS.

         The Trustees, the Paying Agent, the Securities Registrar and Depositor
shall treat any Persons in whose name any Trust Securities are issued as the
owner of such Trust Securities for the purpose of receiving Distributions and
for all other purposes whatsoever, and neither the Trust, the Property Trustee,
the Administrative Trustees, the Securities Registrar nor the Depositor shall
be bound by any notice to the contrary.

                                    Page 26
<PAGE>

SECTION 507.      ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND ADDRESSES.

         At any time when the Property Trustee is not also acting as the
Securities Registrar, the Administrative Trustees or the Depositor shall
furnish or cause to be furnished to the Property Trustee (a) within five
Business Days of March 15, June 15, September 15 and December 15 of each year,
a list, in such form as the Property Trustee may reasonably require, of the
names and addresses of the Securityholders as of the most recent record date;
and (b) promptly after receipt by any Administrative Trustee or the Depositor
of a request therefore from the Property Trustee in order to enable the
Property Trustee to discharge its obligations under this Trust Agreement, in
each case to the extent such information is in the possession or control of the
Administrative Trustees or the Depositor and is not identical to a previously
supplied list or has not otherwise been received by the Property Trustee in its
capacity as Securities Registrar. The rights of Securityholders to communicate
with other Securityholders with respect to their rights under this Trust
Agreement or under the Trust Securities, and the corresponding rights of the
Trustee shall be as provided in the Trust Indenture Act. Each Holder, by
receiving and holding a Trust Securities Certificate, and each owner shall be
deemed to have agreed not to hold the Depositor, the Property Trustee or the
Administrative Trustees accountable by reason of the disclosure of its name and
address, regardless of the source from which such information was derived.

SECTION 508.      MAINTENANCE OF OFFICE OR AGENCY.

         The Property Trustee shall designate, with the consent of the
Administrative Trustees, which consent shall not be unreasonably withheld, an
office or offices or agency or agencies where Preferred Securities Certificates
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Trustees in respect of the Trust Securities
Certificates may be served. The Property Trustee initially designates its
corporate trust office at Rodney Square North, 1100 North Market Street,
Wilmington, Delaware 19890, Attn: Corporate Trust Administration, as the
principal corporate trust office for such purposes. The Property Trustee shall
give prompt written notice to the Depositor, the Administrative Trustees and to
the Securityholders of any change in the location of the Securities Register or
any such office or agency.

SECTION 509.      APPOINTMENT OF PAYING AGENT.

         The Paying Agent shall make Distributions to Securityholders from the
Payment Account and shall report the amounts of such Distributions to the
Property Trustee and the Administrative Trustees. Any Paying Agent shall have
the revocable power to withdraw funds from the Payment Account for the purpose
of making the Distributions referred to above. The Administrative Trustees may
revoke such power and remove the Paying Agent if such Trustees determine in
their sole discretion that the Paying Agent shall have failed to perform its
obligation under this Trust Agreement in any material respect. The Paying Agent
shall initially be the Property Trustee, and any co-paying agent chosen by the
Property Trustee, and acceptable to the Administrative Trustees and the
Depositor. Any Person acting as Paying Agent shall be permitted to resign as
Paying Agent upon 30 days' written notice to the Administrative Trustees, the
Property Trustee and the Depositor. In the event that the Property Trustee
shall no longer be the Paying Agent or a successor Paying Agent shall resign or
its authority to act be revoked, the Administrative Trustees shall appoint a
successor that is reasonably acceptable to the Property Trustee to act as
Paying Agent. The Administrative Trustees shall cause such successor Paying
Agent to execute and deliver to the Trustees an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with the Trustees
that as Paying Agent, such successor Paying Agent or additional Paying Agent
shall hold all sums, if any, held by it for payment to the Securityholders in
trust for the benefit of the Securityholders entitled thereto until such sums
shall be paid to such Securityholders, and the Paying Agent, if other than the
Property Trustee, shall give such Property Trustee notice of any default in the
making of any payment on the Trust Securities. The Paying Agent shall return
all unclaimed funds to the Property Trustee and, upon removal of a Paying
Agent, such Paying Agent shall also return all funds in its possession to the
Property Trustee. The provisions of Sections 801, 803 and 806 shall apply to
the Property Trustee also in its role as Paying Agent, for so long as the
Property Trustee shall act as Paying Agent and, to the extent applicable, to
any other paying agent appointed hereunder. Any reference in this Trust
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.

                                    Page 27
<PAGE>

SECTION 509A.     APPOINTMENT OF CONVERSION AGENT.

The Conversion Agent shall convert the Trust Securities of the Securityholders
in accordance with Section 402A hereof. The Administrative Trustees may revoke
such power and remove the Conversion Agent if such Trustees determine in their
sole discretion that the Conversion Agent shall have failed to perform its
obligations under this Trust Agreement in any material respect. The Conversion
Agent shall initially be the Bank, and any co-paying agent chosen by the Bank,
and acceptable to the Administrative Trustees and the Depositor. Any Person
acting as Conversion Agent shall be permitted to resign as Conversion Agent
upon 30 days' written notice to the Administrative Trustees, the Property
Trustee and the Depositor. In the event that the Bank shall no longer be the
Conversion Agent or a successor Conversion Agent shall resign or its authority
to act be revoked, the Administrative Trustees shall appoint a successor that
is acceptable to the Property Trustee and the Depositor to act as conversion
Agent which shall be a bank or trust company). The provisions of Sections 801,
803 and 806 of this Trust Agreement shall apply to the Bank also in its role as
Conversion Agent, for so long as the Bank shall act as Conversion Agent and, to
the extent applicable, to any other conversion agent appointed hereunder, and
any Conversion Agent shall be bound by the requirements with respect to
conversion agents of securities issued pursuant to the Trust Indenture Act. Any
reference in this Trust Agreement to the Conversion Agent shall include any
co-paying agent unless the context requires otherwise.

SECTION 510.      OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR.

         On the Closing Date, the Depositor shall acquire and retain beneficial
and record ownership of the Common Securities. To the fullest extent permitted
by law, any attempted transfer of the Common Securities (other than a transfer
pursuant to Article XIII of the Indenture) shall be void. The Administrative
Trustees shall cause each Common Securities Certificate issued to the Depositor
to contain a legend stating "TO THE EXTENT PERMITTED BY APPLICABLE LAW, THIS
CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR IN INTEREST TO SOUTHERN
COMMUNITY FINANCIAL CORPORATION, IN COMPLIANCE WITH APPLICABLE LAW AND SECTION
510 OF THAT CERTAIN TRUST AGREEMENT DATED FEBRUARY 13, 2002, AMONG SOUTHERN
COMMUNITY FINANCIAL CORPORATION, AS DEPOSITOR, WILMINGTON TRUST COMPANY, AS
PROPERTY TRUSTEE, AND THE ADMINISTRATIVE TRUSTEES NAMED THEREIN."

SECTION 511.      NOTICES TO CLEARING AGENCY.

         To the extent that a notice or other communication to the Holders is
required under this Trust Agreement, for so long as all Preferred Securities
are represented by a Global Preferred Securities Certificate, the Trustees
shall give all such notices and communications specified herein to be given to
the Clearing Agency, and shall have no obligations to the Owners.

SECTION 511A.     DEFINITIVE PREFERRED SECURITIES CERTIFICATE AND TEMPORARY
PREFERRED SECURITIES.

         (a)      If: (i) the Clearing Agency advises the Trustees in writing
that the Clearing Agency is no longer willing or able to discharge properly its
responsibilities with respect to the Preferred Securities, and the Depositor is
unable to locate a qualified successor within 90 days; (ii) the Trust at its
option advises the Trustees in writing that it elects to terminate the
book-entry system through the Clearing Agency; or (iii) after the occurrence of
a Debenture Event of Default, Holders of a beneficial interest in Preferred
Securities representing beneficial interests aggregating at least a majority of
the Liquidation Amount advise the Administrative Trustees in writing that the
continuation of a book-entry system though the Clearing Agency is no longer in
the best interest of the Holders of Preferred Securities, then the
Administrative Trustees shall notify the Clearing Agency and the Clearing
Agency shall notify the owners of beneficial interests in Global Preferred
Securities and the other Trustees of the occurrence of such event and of the
availability of a Definitive Preferred Security to Holders of such class
requesting the same.

         (b)      Pending the preparation of permanent Definitive Preferred
Securities Certificates, an Administrative Trustee may cause to be executed and
delivered on behalf of the Trust temporary Preferred Securities (the "Temporary
Preferred Securities"), which Temporary Preferred Securities are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the Definitive

                                    Page 28
<PAGE>

Preferred Securities Certificates in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Temporary Preferred Securities may determine, as
evidenced by their execution thereof.

         If Temporary Preferred Securities are issued, an Administrative
Trustee will cause Definitive Preferred Securities Certificates to be prepared
without unreasonable delay. After the preparation of the Definitive Preferred
Securities Certificates, the Temporary Preferred Securities shall be
exchangeable for Definitive Preferred Securities Certificates upon surrender of
the Temporary Preferred Securities at any office or agency of the Depositor
designated herein, without charge to the Holder. Upon surrender for
cancellation of any one or more Temporary Preferred Securities, the Depositor
shall execute and an Administrative Trustee shall execute by manual, facsimile
or imprinted signature and the Property Trustee shall authenticate and make
available for delivery in exchange therefor a like principal amount of
Definitive Preferred Securities Certificates of authorized denominations. Until
so exchanged the Temporary Preferred Securities shall in all respects be
entitled to the same benefits as Definitive Preferred Securities Certificates.

SECTION 512.      RIGHTS OF SECURITYHOLDERS.

         (a)      The legal title to the Trust Property is vested exclusively
in the Property Trustee (in its capacity as such) in accordance with Section
209, and the Securityholders shall not have any right or title therein other
than the undivided beneficial interest in the assets of the Trust conferred by
their Trust 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 Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust Agreement. The Trust
Securities shall have no preemptive or similar rights. When issued and
delivered to Holders of the Trust Securities against payment of the purchase
price therefor, the Trust Securities shall be fully paid and nonassessable,
undivided beneficial interests in the assets of the Trust. The Holders of the
Trust Securities, in their capacities as such, 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.

         (b)      For so long as any Preferred Securities remain Outstanding,
if, upon a Debenture Event of Default, the Debenture Trustee fails or the
holders of not less than 25% in principal amount of the outstanding Debentures
fail to declare the principal of all of the Debentures to be immediately due
and payable, the Holders of Preferred Securities having an aggregate
Liquidation Amount of not less than 25% of the aggregate Liquidation Amount of
the Preferred Securities then Outstanding shall have the right to make such
declaration by a notice in writing to the Depositor and the Debenture Trustee;
and upon any such declaration such principal amount of and the accrued interest
on all of the Debentures shall become immediately due and payable, provided
that the payment of principal and interest on such Debentures shall remain
subordinated to the extent provided in the Indenture.

         (c)      For so long as any Preferred Securities remain Outstanding,
if, upon a Debenture Event of Default arising from the failure to pay interest
or principal on the Debentures, any Holders of Preferred Securities then
Outstanding shall, to the fullest extent permitted by law and subject to the
terms of this Trust Agreement and the Indenture, have the right to institute a
proceeding directly against the Depositor for enforcement of payment to such
Holders of principal of or interest on the Debentures having a principal amount
equal to the Liquidation Amount of the Preferred Securities of such Holders.

SECTION 513.      CUSIP NUMBERS.

         The Depositor in issuing the Debentures may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustees shall use "CUSIP" numbers in
notices of redemption as a convenience to holders; provided that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Debentures or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Debentures, and any such redemption shall not be
affected by any defect in or omission of such numbers. The Depositor will
promptly notify the Property Trustee of any change in the CUSIP numbers.

                                    Page 29
<PAGE>

                                   ARTICLE VI
                   ACTS OF SECURITYHOLDERS; MEETINGS; VOTING

SECTION 601.      LIMITATIONS ON VOTING RIGHTS.

         (a)      Except as provided in this Section 601, in Sections 512, 810
and 1002 and in the Indenture and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any manner otherwise
control the administration, operation and management of the Trust or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Trust Securities Certificates, be construed so as
to constitute the Securityholders from time to time as partners or members of
an association.

         (b)      So long as any Debentures are held by the Property Trustee,
the Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on the Debenture Trustee with respect to such
Debentures; (ii) waive any past default which is waivable under Article VII of
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
to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of at least a Majority in
liquidation amount of the Outstanding Preferred Securities; provided, however,
that where a consent under the Indenture would require the consent of each
Holder of Outstanding Debentures affected thereby, no such consent shall be
given by the Property Trustee without the prior written consent of each Holder
of Preferred Securities. The Trustees shall not revoke any action previously
authorized or approved by a vote of the Holders of the Outstanding Preferred
Securities, except by a subsequent vote of the Holders of the Outstanding
Preferred Securities. The Property Trustee shall promptly notify each Holder of
Outstanding Preferred Securities of any notice of default received from the
Debenture Trustee with respect to the Debentures. In addition to obtaining the
foregoing approvals of the Holders of the Preferred Securities, prior to taking
any of the foregoing actions, the Administrative Trustees shall provide to the
Property Trustee, at the expense of the Depositor, an Opinion of Counsel
experienced in such matters to the effect that the Trust shall continue to be
classified as a grantor trust and not as an association taxable as a
corporation for United States federal income tax purposes on account of such
action.

         (c)      If any proposed amendment to the Trust Agreement provides
for, or the Trustees otherwise propose to effect, (i) any action that would
adversely affect in any material respect the powers, preferences or special
rights of the Preferred Securities, whether by way of amendment to the Trust
Agreement or otherwise; or (ii) the dissolution, winding-up or termination of
the Trust, other than pursuant to the terms of this Trust Agreement, then the
Holders of Outstanding Preferred Securities as a class shall be entitled to
vote on such amendment or proposal and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a Majority in
liquidation amount of the Outstanding Preferred Securities. No amendment to
this Trust Agreement may be made if, as a result of such amendment, the Trust
would cease to be classified as a grantor trust or would be classified as an
association taxable as a corporation for United States federal income tax
purposes.

SECTION 602.      NOTICE OF MEETINGS.

         Notice of all meetings of the Preferred Securityholders, stating the
time, place and purpose of the meeting, shall be given by the Property Trustee
pursuant to Section 1008 to each Preferred Securityholder of record, at his
registered address, at least 15 days and not more than 90 days before the
meeting. At any such meeting, any business properly before the meeting may be
so considered whether or not stated in the notice of the meeting. Any adjourned
meeting may be held as adjourned without further notice.

SECTION 603.      MEETINGS OF PREFERRED SECURITYHOLDERS.

         (a)      No annual meeting of Securityholders is required to be held.
The Administrative Trustees, however, shall call a meeting of Securityholders
to vote on any matter in respect of which Preferred Securityholders are
entitled to vote upon the written request of the Preferred Securityholders of
record of 25% of the Outstanding Preferred Securities (based upon their
aggregate Liquidation Amount) and the Administrative Trustees or the Property
Trustee may, at any time in their discretion, call a meeting of Preferred
Securityholders to vote on any matters as to which the Preferred
Securityholders are entitled to vote.

                                    Page 30
<PAGE>

         (b)      Preferred Securityholders of record of 50% of the Outstanding
Preferred Securities (based upon their aggregate Liquidation Amount), present
in person or by proxy shall constitute a quorum at any meeting of
Securityholders.

         (c)      If a quorum is present at a meeting, an affirmative vote by
the Preferred Securityholders of record present, in person or by proxy, holding
more than a majority of the Preferred Securities (based upon their aggregate
Liquidation Amount) held by the Preferred Securityholders of record present,
either in person or by proxy, at such meeting shall constitute the action of
the Securityholders unless this Trust Agreement requires a greater number of
affirmative votes.

SECTION 604.      VOTING RIGHTS.

         Securityholders shall be entitled to one vote for each $10 of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote.

SECTION 605.      PROXIES, ETC.

         At any meeting of Securityholders, any Securityholder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the Administrative Trustees, or
with such other officer or agent of the Trust as the Administrative Trustees
may direct, for verification prior to the time at which such vote shall be
taken. When Trust Securities are held jointly by several Persons, any one of
them may vote at any meeting in person or by proxy in respect of such Trust
Securities, but if more than one of them shall be present at such meeting in
person or by proxy, and such joint owners or their proxies so present disagree
as to any vote to be cast, such vote shall not be received in respect of such
Trust Securities. A proxy purporting to be executed by or on behalf of a
Securityholder shall be deemed valid unless challenged at or prior to its
exercise, and, the burden of proving invalidity shall rest on the challenger.
No proxy shall be valid more than three years after its date of execution.

SECTION 606.      SECURITYHOLDER ACTION BY WRITTEN CONSENT.

         Any action which may be taken by Securityholders at a meeting may be
taken without a meeting and without prior notice if Securityholders holding a
majority of all Outstanding Trust Securities (based upon their aggregate
Liquidation Amount) entitled to vote in respect of such action (or such larger
proportion thereof as shall be required by any express provision of this Trust
Agreement) shall consent to the action in writing.

SECTION 607.      RECORD DATE FOR VOTING AND OTHER PURPOSES.

         For the purposes of determining the Securityholders who are entitled
to notice of and to vote at any meeting or by written consent, or to
participate in any Distribution on the Trust Securities, in respect of which a
record date is not otherwise provided for in this Trust Agreement, or for the
purpose of any other action, the Administrative Trustees may from time to time
fix a date, not more than 90 days prior to the date of any meeting of
Securityholders or the payment of any Distribution or other action as the case
may be, as a record date for the determination of the identity of the
Securityholders of record for such purposes.

SECTION 608.      ACTS OF SECURITYHOLDERS.

         (a)      Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Trust Agreement
to be given, made or taken by Securityholders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such
Securityholders in person or by an agent duly appointed in writing, and, except
as otherwise expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative Trustee. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Securityholders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for
any purpose of this Trust Agreement and (subject to Section 801) conclusive in
favor of the Trustees, if made in the manner provided in this Section 608.

                                    Page 31
<PAGE>

         (b)      The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.

         (c)      The ownership of Preferred Securities shall be proved by the
Securities Register.

         (d)      Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the securityholder of any Trust Security shall
bind every future Securityholder of the same Trust Security and the
Securityholder of every Trust Security issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Trustees or the Trust in reliance
thereon, whether or not notation of such action is made upon such Trust
Security.

         (e)      Without limiting the foregoing, a Securityholder entitled
hereunder to take any action hereunder with regard to any particular Trust
Security may do so with regard to all or any part of the Liquidation Amount of
such Trust Security or by one or more duly appointed agents each of which may
do so pursuant to such appointment with regard to all or any part of such
Liquidation Amount.

         (f)      A Securityholder may institute a legal proceeding directly
against the Depositor under the Guarantee to enforce its rights under the
Guarantee without first instituting a legal proceeding against the Guarantee
Trustee (as defined in the Guarantee), the Trust or any Person.

SECTION 609.      INSPECTION OF RECORDS.

         Upon reasonable notice to the Administrative Trustees and the Property
Trustee, the records of the Trust shall be open to inspection and copying by
Securityholders and their authorized representatives during normal business
hours for any purpose reasonably related to such Securityholder's interest as a
Securityholder.

                                  ARTICLE VII
                        REPRESENTATIONS AND WARRANTIES

SECTION 701.      REPRESENTATIONS AND WARRANTIES OF THE PROPERTY TRUSTEE AND
THE BANK.

         The Bank and the Property Trustee, each severally on behalf of and as
to itself, as of the date hereof, and each successor Property Trustee at the
time of the successor Property Trustee's acceptance of its appointment as
Property Trustee hereunder (in the case of a successor Property Trustee, the
term "Bank" as used herein shall be deemed to refer to such successor Property
Trustee in its separate corporate capacity), hereby represents and warrants (as
applicable) for the benefit of the Depositor and the Securityholders that:

         (a)      the Bank is a Delaware banking corporation, duly organized,
validly existing and in good standing under the laws of the State of Delaware;

         (b)      the Bank has full corporate power, authority and legal right
to execute, deliver and perform its obligations under this Trust Agreement and
has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;

         (c)      the Bank has its principal place of business in the State of
Delaware;

         (d)      this Trust Agreement has been duly authorized, executed and
delivered by the Property Trustee and constitutes the valid and legally binding
agreement of the Property Trustee enforceable against it in accordance with

                                    Page 32
<PAGE>

its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors rights and to general equity principles;

         (e)      the execution, delivery and performance by the Property
Trustee of this Trust Agreement has been duly authorized by all necessary
corporate or other action on the part of the Property Trustee and does not
require any approval of stockholders of the Bank and such execution delivery
and performance shall not (i) violate the charter or by-laws of the Bank; (ii)
violate any provision of, or constitute, with or without notice or lapse of
time, a default under, or result in the creation or imposition of, any Lien on
any properties included in the Trust Property pursuant to the provisions of any
indenture, mortgage, credit agreement, license or other agreement or instrument
to which the Property Trustee or the Bank is a party or by which it is bound;
or (iii) violate any law, governmental rule or regulation of the State of
Delaware governing the banking or trust powers of the Property Trustee or the
Bank or (as appropriate in context) or any order, judgment or decree applicable
to the Property Trustee or the Bank;

         (f)      neither the authorization, execution or delivery by the
Property Trustee of this Trust Agreement nor the consummation of any of the
transactions by the Property Trustee contemplated herein or therein requires
the consent or approval of, the giving of notice to, the registration with or
the taking of any other action with respect to any governmental authority or
agency under any existing Delaware of federal law governing the banking or
trust powers of the Property Trustee or the Bank, as the case may be;

         (g)      there are no proceedings pending or, to the best of the
Property Trustee's knowledge, threatened against or affecting the bank or the
Property Trustee in any court or before any governmental authority, agency or
arbitration board or tribunal which, individually or in the aggregate, would
materially and adversely affect the Trust or would question the right, power
and authority of the Property Trustee to enter into or perform its obligations
as one of the Trustees under this Trust Agreement; and

         (h)      the Property Trustee is a Person eligible pursuant to the
Trust Indenture Act to act as such and has a combined capital and surplus of at
least $50,000,000.

SECTION 702.      REPRESENTATIONS AND WARRANTIES OF THE DELAWARE BANK AND THE
DELAWARE TRUSTEE.

         The Delaware Bank and the Delaware Trustee, each severally on behalf
of and as to itself, as of the date hereof, and each successor Delaware Trustee
at the time of the successor Delaware Trustee's acceptance of appointment as
Delaware Trustee hereunder (the term "Delaware Bank" being used to refer to
such successor Delaware Trustee in its separate corporate capacity), hereby
represents and warrants (as applicable) for the benefit of the Depositor and
the Securityholders that:

         (a)      the Delaware Bank is a Delaware banking corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware;

         (b)      the Delaware Trustee satisfies the requirements of Section
3807 of the Delaware Business Trust Act;

         (c)      the Delaware Bank has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;

         (d)      this Trust Agreement has been duly authorized, executed and
delivered by the Delaware Trustee and constitutes the valid and legally binding
agreement of the Delaware Trustee enforceable against it in accordance with its
terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors, rights and to general equity principles;

         (e)      the execution, delivery and performance by the Delaware
Trustee of this Trust Agreement has been duly authorized by all necessary
corporate or other action on the part of the Delaware Trustee and does not
require any approval of stockholders of the Delaware Bank and such execution,
delivery and performance shall not (i) violate the Delaware Bank's charter or
by-laws; (ii) violate any provision of, or constitute, with or without notice
or lapse of time, a default under, or result in the creation or imposition of,
any Lien on any properties included in the Trust

                                    Page 33
<PAGE>

Property pursuant to the provisions of, any indenture, mortgage, credit
agreement, license or other agreement or instrument to which the Delaware Bank
or the Delaware Trustee is a party or by which it is bound; or (iii) violate
any law, governmental rule or regulation of the United States or the State of
Delaware, as the case may be, governing the banking or trust powers of the
Delaware Bank or the Delaware Trustee (as appropriate in context) or any order,
judgment or decree applicable to the Delaware Bank or the Delaware Trustee;

         (f)      neither the authorization, execution or delivery by the
Delaware Trustee of this Trust Agreement nor the consummation of any of the
transactions by the Delaware Trustee contemplated herein or therein requires
the consent or approval of, the giving of notice to, the registration with or
the taking of any other action with respect to any governmental authority or
agency under any existing federal law governing the banking or trust powers of
the Delaware Bank or the Delaware Trustee, as the case may be, under the laws
of the United States or the State of Delaware; and

         (g)      there are no proceedings pending or, to the best of the
Delaware Trustee's knowledge, threatened against or affecting the Delaware Bank
or the Delaware Trustee in any court or before any governmental authority,
agency or arbitration board or tribunal which, individually or in the
aggregate, would materially and adversely affect the Trust or would question
the right, power and authority of the Delaware Trustee to enter into or perform
its obligations as one of the Trustees under this Trust Agreement.

SECTION 703.      REPRESENTATIONS AND WARRANTIES OF DEPOSITOR.

         The Depositor hereby represents and warrants for the benefit of the
Securityholders that:

         (a)      the Trust Securities Certificates issued on the Closing Date
or the Option Closing Date on behalf of the Trust have been duly authorized
and, shall have been, duly and validly executed, issued and delivered by the
Administrative Trustees pursuant to the terms and provisions of, and in
accordance with the requirements of, this Trust Agreement and the
Securityholders shall be, as of such date, entitled to the benefits of this
Trust Agreement; and

         (b)      there are no taxes, fees or other governmental charges
payable by the Trust (or the Trustees on behalf of the Trust) under the laws of
the State of Delaware or any political subdivision thereof in connection with
the execution, delivery and performance by the Bank or the Property Trustee, as
the case may be, of this Trust Agreement.

                                  ARTICLE VIII
                                    TRUSTEES

SECTION 801.      CERTAIN DUTIES AND RESPONSIBILITIES.

         (a)      The duties and responsibilities of the Trustees shall be as
provided by this Trust Agreement and, in the case of the Property Trustee, by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Trust Agreement shall require the Trustees to expend or risk their own funds or
otherwise incur any financial liability in the performance of any of their
duties hereunder, or in the exercise of any of their rights or powers, if they
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured. No
Administrative Trustee shall be liable for its act or omissions hereunder
except as a result of its own gross negligence or bad faith or willful
misconduct. The Property Trustee's liability shall be determined under the
Trust Indenture Act. Whether or not therein expressly so provided, every
provision of this Trust Agreement relating to the conduct or affecting the
liability of or affording protection to the Trustees shall be subject to the
provisions of this Section 801. To the extent that, at law or in equity, an
Administrative Trustee has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to the Securityholders, such Administrative
Trustee shall not be liable to the Trust or to any Securityholder for such
Trustee's good faith reliance on the provisions of this Trust Agreement. The
provisions of this Trust Agreement, to the extent that they restrict the duties
and liabilities of the Delaware Trustee or the Administrative Trustees
otherwise existing at law or in equity, are agreed by the Depositor and the
Securityholders to replace such other duties and liabilities of the Delaware
Trustee or the Administrative Trustees, as the case may be.

                                    Page 34
<PAGE>

         (b)      All payments made by the Property Trustee or a Paying Agent
in respect of the Trust 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 Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
With respect to the relationship of each Securityholder and the Trustees, each
Securityholder, by its acceptance of a Trust Security, agrees that it shall
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 are not personally liable to it for any amount distributable in
respect of any Trust Security or for any other liability in respect of any
Trust Security. This Section 801(b) does not limit the liability of the
Trustees expressly set forth elsewhere in this Trust Agreement, or, in the case
of the Property Trustee, the Trust Indenture Act.

         (c)      No provision of this Trust Agreement shall be construed to
relieve the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:

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

                  (ii)     the Property 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 Outstanding Trust Securities relating to the time,
method and place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power conferred upon the Property
Trustee under this Trust Agreement;

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

                  (iv)     the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree in
writing with the Depositor and money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the Payment
Account maintained by the Property Trustee pursuant to Section 301 and except
to the extent otherwise required by law; and

                  (v)      the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Depositor with
their respective duties under this Trust Agreement, nor shall the Property
Trustee be liable for the negligence, default or misconduct of the
Administrative Trustees or the Depositor.

SECTION 802.      CERTAIN NOTICES.

         (a)      Within five (5) Business Days after the occurrence of any
Event of Default actually known to the Property Trustee or, to the extent
Section 315(b) of the Trust Indenture Act applies, within 90 days after the
occurrence of any default hereunder known to the Property Trustee, the Property
Trustee shall transmit, in the manner and to the extent provided in Section
313(c) of the Trust Indenture Act notice of such Event of Default or default to
the Securityholders, the Administrative Trustees and the Depositor, unless such
Event of Default shall have been cured or waived. For purposes of this Section
802, the term "Event of Default" means any event that is or after notice or
lapse of time or both would become an Event of Default.

         (b)      The Administrative Trustees shall transmit, to the
Securityholders and the Property Trustee in the manner and to the extent
provided in Section 1008 hereof and to the extent applicable, Section 313(c) of
the Trust Indenture Act, notice of the Depositor's election to begin or further
extend an Extended Interest Payment Period on the Debentures (unless such
election shall have been revoked) within the time specified for transmitting
such notice to the holders of the Debentures pursuant to the Indenture as
originally executed.

                                    Page 35
<PAGE>

SECTION 803.      CERTAIN RIGHTS OF PROPERTY TRUSTEE.

         Subject to the provisions of Section 801:

         (a)      the Property Trustee may conclusively rely and shall be
protected in acting or refraining from acting in good faith upon any
resolution, Opinion of Counsel, certificate, written representation of a Holder
or transferee, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, 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 or presented by the proper
party or parties;

         (b)      if (i) in performing its duties under this Trust Agreement
the Property Trustee is required to decide between alternative courses of
action; or (ii) in construing any of the provisions of this Trust Agreement the
Property Trustee finds the same ambiguous or inconsistent with other provisions
contained herein; or (iii) the Property Trustee is unsure of the application of
any provision of this Trust Agreement, then, except as to any matter as to
which the Preferred Securityholders are entitled to vote or otherwise consent
or approve under the terms of this Trust Agreement and except if there then
exists an Event of Default, the Property Trustee shall deliver a notice to the
Depositor requesting written instructions of the Depositor as to the course of
action to be taken and the Property Trustee shall take such action, or refrain
from taking such action, as the Property Trustee shall be instructed in writing
to take, or to refrain from taking, by the Depositor, and shall have no
liability for acting in accordance with such instructions; provided, however,
that if the Property Trustee does not receive such instructions of the
Depositor within 10 Business Days after it has delivered such notice, or such
reasonably shorter period of time set forth in such notice (which to the extent
practicable shall not be less than 2 Business Days), it may, but shall be under
no duty to, take or refrain from taking such action not inconsistent with this
Trust Agreement as it shall deem advisable and in the best interests of the
Securityholders, in which event the Property Trustee shall have no liability
except for its own bad faith, negligence or willful misconduct;

         (c)      any direction or act of the Depositor or the Administrative
Trustees contemplated by this Trust Agreement shall be sufficiently evidenced
by an Officers' Certificate;

         (d)      whenever in the administration of this Trust Agreement, the
Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property 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 Depositor or the Administrative Trustees;

         (e)      the Property Trustee shall have no duty on behalf of the
Trust 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 re-recording, refiling, or reregistration thereof;

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

         (g)      the Property Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Trust Agreement at the request
or direction of any of the Securityholders pursuant to this Trust Agreement,
unless such Securityholders shall have offered to the Property Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or direction;
nothing contained herein shall, however, relieve the Property Trustee of the
obligation, upon the occurrence of any Event of Default (that has not been
cured or waived) to exercise such of the rights and powers vested in it by this
Trust Agreement, and to use the same degree of care and skill in their exercise
as a prudent man would exercise or use under the circumstances in the conduct
of his own affairs;

         (h)      the Property 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,

                                    Page 36
<PAGE>

debenture, note or other evidence of indebtedness or other paper or document,
unless requested in writing to do so by one or more Securityholders, but the
Property Trustee may make such further inquiry or investigation into such facts
or matters as it may see fit;

         (i)      the Property 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, provided that the Property Trustee shall be responsible
for its own negligence or recklessness with respect to selection of any agent
or attorney appointed by it hereunder;

         (j)      except as provided in this Article VIII, in accepting the
trusts hereby created, the Property Trustee acts solely as such hereunder and
not in its individual capacity;

         (k)      whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive instructions with respect
to enforcing any remedy or right or taking any other action hereunder the
Property Trustee (i) may request written instructions from the Holders of the
Trust Securities which written instructions may only be followed by the
Property Trustee if given by the Holders of the same proportion in Liquidation
Amount of the Trust Securities as would be entitled to direct the Property
Trustee under the terms of the Trust Securities in respect of such remedy,
right or action; (ii) may refrain from enforcing such remedy or right or taking
such other action until such instructions are received; and (iii) shall be
protected in acting in accordance with such written instructions; and

         (l)      except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement. No
provision of this Trust Agreement shall be deemed to impose any duty or
obligation on the Property 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 Property 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 Property Trustee
shall be construed to be a duty.

SECTION 804.      NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

         The Recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.

SECTION 805.      MAY HOLD SECURITIES.

         Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Trust
Securities and, subject to Sections 808 and 813 and except as provided in the
definition of the term "Outstanding" in Article I, may otherwise deal with the
Trust with the same rights it would have if it were not a Trustee or such other
agent.

SECTION 806.      COMPENSATION; INDEMNITY; FEES.

         The Depositor agrees:

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

         (b)      except as otherwise expressly provided herein, to reimburse
the Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any provision of
this Trust Agreement (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to such Trustee's negligence,
bad faith or willful misconduct (or, in the case of the Administrative
Trustees, any such expense,

                                    Page 37
<PAGE>

disbursement or advance as may be attributable to its, his or her gross
negligence, bad faith or willful misconduct); and

         (c)      to indemnify, to the fullest extent permitted by law, each of
the Trustees or any predecessor Trustee for, and to hold the Trustees harmless
against, any and all loss, damage, claim, action, suit, liability, penalty or
expense, including taxes (other than taxes based on the income of the Trustee)
of any kind and nature whatsoever incurred without negligence or willful
misconduct on its part, arising out of or in connection with the acceptance or
administration of this Trust Agreement, including the costs and expenses of
defending itself against any claim or liability in connection with the
acceptance, exercise or performance of any of its powers or duties hereunder,
except any such expense, disbursement or advance as may be attributable to such
Trustee's negligence, bad faith or willful misconduct (or, in the case of the
Administrative Trustees, any such expense, disbursement or advance as may be
attributable to its, his or her gross negligence, bad faith or willful
misconduct).

         The provisions of this Section 806 shall survive the termination of
this Trust Agreement or the earlier resignations or removal of any Trustee.

         No Trustee may claim any Lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 806.

         When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 8.1(a)(iv), Section 8.1(a)(v) or
8.1(a)(vi) of the Indenture, the expenses (including reasonable charges and
expenses of its counsel) and the compensation for the services are intended to
constitute expenses of administration under any applicable Bankruptcy Law.

SECTION 807.      CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF TRUSTEES.

         (a)      There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act, if applicable, to act as such and
has a combined capital and surplus of at least $50,000,000. If any such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of its supervising or examining authority, then for the purposes
of this Section 807, the combined capital and surplus of such Person shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Property Trustee with
respect to the Trust Securities shall cease to be eligible in accordance with
the provisions of this Section 807, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article VIII. The Property
Trustee and the Delaware Trustee may be the same Person.

         (b)      There shall at all times be one or more Administrative
Trustees hereunder with respect to the Trust Securities. Each Administrative
Trustee shall be either a natural person who is at least 21 years of age or a
legal entity that shall act through one or more persons authorized to bind that
entity.

         (c)      One of the Trustees with respect to the Trust Securities
shall, at all times, meet the requirements ofss.3807 of the Delaware Business
Trust Act.

SECTION 808.      CONFLICTING INTERESTS.

         If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall
either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the Trust Indenture Act and this
Trust Agreement.

SECTION 809.      CO-TRUSTEES AND SEPARATE TRUSTEE.

         (a)      Unless an Event of Default shall have occurred and be
continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any
part of the Trust Property may at the time be located, the Depositor shall have
power to appoint, and upon the written request of the Property Trustee, the
Depositor shall for such purpose join with the Property Trustee in the
execution, delivery and

                                    Page 38
<PAGE>

performance of any instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to act as
co-trustee, jointly with the Property Trustee, of all or any part of such Trust
Property, or to the extent required by law to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the
capacity aforesaid, any property, title, right or power deemed necessary or
desirable, subject to the other provisions of this Section 809. If the
Depositor does not join in such appointment within 15 days after the receipt by
it of a request so to do, or in case a Debenture Event of Default has occurred
and is continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section 809 shall either be (i) a natural person who is at least 21 years of
age and a resident of the United States; or (ii) a legal entity with its
principal place of business in the United States that shall act through one or
more persons authorized to bind such entity.

         (b)      Should any written instrument from the Depositor be required
by any co-trustee or separate trustee so appointed for more fully confirming to
such co-trustee or separate trustee such property, title, right, or power, any
and all such instruments shall, on request, be executed, acknowledged, and
delivered by the Depositor.

         (c)      Every co-trustee or separate trustee shall, to the extent
permitted by law, but to such extent only, be appointed subject to the
following terms, namely:

                  (i)      The Trust Securities shall be executed and delivered
and all rights, powers, duties and obligations hereunder in respect of the
custody of securities, cash and other personal property held by, or required to
be deposited or pledged with, the Trustees specified hereunder, shall be
exercised, solely by such Trustees and not by such co-trustee or separate
trustee.

                  (ii)     The rights, powers, duties and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such
co-trustee or separate trustee jointly, as shall be provided in the instrument
appointing such co-trustee or separate trustee, except to the extent that under
any law of any jurisdiction in which any particular act is to be performed, the
Property Trustee shall be incompetent or unqualified to perform such act, in
which event such rights, powers, duties and obligations shall be exercised and
performed by such co-trustee or separate trustee.

                  (iii)    The Property Trustee at any time, by an instrument
in writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-trustee or separate trustee
appointed under this Section 809, and, in case a Debenture Event of Default has
occurred and is continuing, the Property Trustee shall have the power to accept
the resignation of, or remove, any such co-trustee or separate trustee without
the concurrence of the Depositor. Upon the written request of the Property
Trustee, the Depositor shall join with the Property Trustee in the execution,
delivery and performance of all instruments and agreements necessary or proper
to effectuate such resignation or removal. A successor to any co-trustee or
separate trustee so resigned or removed may be appointed in the manner provided
in this Section 809.

                  (iv)     No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee or
any other trustee hereunder.

                  (v)      The Property Trustee shall not be liable by reason
of any act of a co-trustee or separate trustee.

                  (vi)     Any Act of Holders delivered to the Property Trustee
shall be deemed to have been delivered to each such co-trustee and separate
trustee.

SECTION 810.      RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

         (a)      No resignation or removal of any Trustee (the "Relevant
Trustee") and no appointment of a successor Trustee pursuant to this Article
VIII shall become effective until the acceptance of appointment by the
successor Trustee in accordance with the applicable requirements of Section
811.

                                    Page 39
<PAGE>

         (b)      Subject to the immediately preceding paragraph, the Relevant
Trustee may resign at any time with respect to the Trust Securities by giving
written notice thereof to the Depositor and with respect to the Property
Trustee to the Securityholders. If the instrument of acceptance by the
successor Trustee required by Section 811 shall not have been delivered to the
Relevant Trustee within 30 days after the giving of such notice of resignation,
the Relevant Trustee may petition, at the expense of the Depositor, any court
of competent jurisdiction for the appointment of a successor Relevant Trustee
with respect to the Trust Securities.

         (c)      Unless a Debenture Event of Default shall have occurred and
be continuing, any Trustee may be removed at any time by act of the Common
Securityholder. If a Debenture Event of Default shall have occurred and be
continuing, the Property Trustee may be removed at such time by Act of the
Holders of a Majority in liquidation amount of the Outstanding Preferred
Securities, delivered to the Relevant Trustee (in its individual capacity and
on behalf of the Trust). An Administrative Trustee may be removed by the Common
Securityholder at any time. In no event will the Holders of the Preferred
Securities have the right to vote to appoint, remove or replace the
Administrative Trustees, which right to remove is vested exclusively in the
Common Securityholder. If an instrument of acceptance by a Successor Trustee
required by Section 811 shall have not been delivered to the Relevant Trustee
within 30 days after the giving of such notice of removal, the Relevant Trustee
may petition, at the expense of the Depositor, any court of competent
jurisdiction for the appointment of a Successor Relevant Trustee with respect
to the Trust Securities.

         (d)      If any Trustee shall resign, be removed or become incapable
of acting as Trustee, or if a vacancy shall occur in the office of any Trustee
for any cause, at a time when no Debenture Event of Default shall have occurred
and be continuing, the Common Securityholder, by Act of the Common
Securityholder delivered to the retiring Trustee, shall promptly appoint a
successor Trustee or Trustees with respect to the Trust Securities and the
Trust, and the successor Trustee shall comply with the applicable requirements
of Section 811. If the Property Trustee shall resign, be removed or become
incapable of continuing to act as the Property Trustee at a time when a
Debenture Event of Default shall have occurred and is continuing, the Preferred
Securityholders, by Act of the Securityholders of a Majority in liquidation
amount of the Outstanding Preferred Securities delivered to the retiring
Relevant Trustee, shall promptly appoint a successor Relevant Trustee or
Trustees with respect to the Trust Securities and the Trust, and such successor
Trustee shall comply with the applicable requirements of Section 811. If an
Administrative Trustee shall resign, be removed or become incapable of acting
as Administrative Trustee, at a time when a Debenture Event of Default shall
have occurred and be continuing, the Common Securityholder, by Act of the
Common Securityholder delivered to an Administrative Trustee, shall promptly
appoint a successor Administrative Trustee or Administrative Trustees with
respect to the Trust Securities and the Trust, and such successor
Administrative Trustee or Administrative Trustees shall comply with the
applicable requirements of Section 811. If no successor Relevant Trustee with
respect to the Trust Securities shall have been so appointed by the Common
Securityholder or the Preferred Securityholders and accepted appointment in the
manner required by Section 811, any Securityholder who has been a
Securityholder of Trust Securities on behalf of himself and all others
similarly situated may petition a court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Trust Securities.

         (e)      The Administrative Trustee shall give notice of each
resignation and each removal of the Property Trustee and each appointment of a
successor Property Trustee to all Securityholders in the manner provided in
Section 1008 and shall give notice to the Depositor.

         (f)      Notwithstanding the foregoing or any other provision of this
Trust Agreement, in the event any Administrative Trustee who is a natural
person dies or becomes, in the opinion of the Depositor, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity
may be filled by (a) the unanimous act of the remaining Administrative Trustees
if there are at least two of them; or (b) otherwise by the Depositor (with the
successor in each case being a Person who satisfies the eligibility requirement
for Administrative Trustees as forth in Section 807).

SECTION 811.      ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

         (a)      In case of the appointment hereunder of a successor Relevant
Trustee with respect to the Trust Securities and the Trust, the retiring
Relevant Trustee and each successor Relevant Trustee with respect to the Trust
Securities shall execute and deliver an instrument hereto wherein each
successor Relevant Trustee shall accept such

                                    Page 40
<PAGE>

appointment and which 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 Trust Securities and the Trust and, upon the
execution and delivery of such instrument, 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 with respect to the Trust Securities and the
Trust, but, on request of the Trust or any successor Relevant Trustee such
retiring Relevant Trustee shall upon payment of its charges hereunder, 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 Trust Securities and the Trust.

         (b)      Upon request of any such successor Relevant Trustee, the
Trust shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Relevant Trustee all such rights,
powers and trusts referred to in the immediately preceding paragraph, as the
case may be.

         (c)      No successor Relevant Trustee shall accept its appointment
unless at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article VIII.

SECTION 812.      MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.

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

SECTION 813.      PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR TRUST.

         If and when the Property Trustee shall be or become, directly or
indirectly, a creditor of the Depositor or the Trust (or any other obligor upon
the Debentures or the Trust Securities), excluding any creditor relationship
described in Section 311(b) of the Trust Indenture Act, the Property Trustee
shall be subject to and shall take all actions necessary in order to comply
with the provisions of Section 311(a) of Trust Indenture Act regarding the
collection of claims against the Depositor or Trust (or any such other
obligor).

SECTION 814.      REPORTS BY PROPERTY TRUSTEE.

         (a)      The Property Trustee shall transmit to Securityholders
entitled to receive the same under Section 313(c) of the Trust Indenture Act by
mail such reports concerning the Property Trustee and its actions under this
Trust Agreement as may be required pursuant to Section 313(b) of the Trust
Indenture Act at the times provided pursuant thereto. If required by Section
313(a) of the Trust Indenture Act, the Property Trustee shall, within sixty
days after each December 31 following the date of the Trust Agreement, deliver
to Securityholders entitled to receive the same under Section 313(c) of the
Trust Indenture Act by mail a brief report, dated as of such December 31, which
complies with the provisions of such Section 313(a).

         (b)      A copy of each such report provided for in this Section 814
shall, at the time of such transmission to Holders, be filed by the Property
Trustee with the Nasdaq National Market or other organization upon with the
Trust Securities are listed, and also with the Commission and the Depositor.

SECTION 815.      REPORTS TO THE PROPERTY TRUSTEE.

         The Depositor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information
as required by Section 314 of the Trust Indenture Act (if any) and the
compliance certificate required by Section 314(a) of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.

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<PAGE>

         Delivery of such reports, information and documents to the Property
Trustee is for information purposes only and the Property Trustee's receipt of
such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Depositor's compliance with any of its covenants hereunder (as to which the
Property Trustee is entitled to rely exclusively on Officers' Certificates).

         The Depositor shall transmit to Securityholders, in the manner and to
the extent provided in Section 313(c) of the Trust Indenture Act, such
summaries of the above-referenced materials as may be required by Section
314(a)(3) of the Trust Indenture Act.

SECTION 816.      EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.

         Each of the Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee: (i) such evidence of compliance
with any conditions precedent, if any, provided for in this Trust Agreement
that relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act in accordance with the requirements of said Section; and (ii)
such certificates, if any, as may be required by Section 314(a)(4) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(a)(4) or 314(c)(1) of the Trust Indenture Act shall be
given in the form of an Officers' Certificate.

SECTION 817.      NUMBER OF TRUSTEES.

         (a)      The number of Trustees shall initially be five, provided that
the Holder of all of the Common Securities by written instrument may increase
or decrease the number of Administrative Trustees. The Delaware Trustee and the
Property Trustee may be the same Person.

         (b)      If a Trustee ceases to hold office for any reason and the
number of Administrative Trustees is not reduced pursuant to Section 817(a), or
if the number of Trustees is increased pursuant to Section 817(a), a vacancy
shall occur. The vacancy shall be filled with a Trustee appointed in accordance
with Section 810.

         (c)      The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 810, the
Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Agreement), shall have all the
powers granted to the Administrative Trustees and shall discharge all the
duties imposed upon the Administrative Trustees by this Trust Agreement.

         (d)      The Trust shall, at all times, have at least one Trustee that
meets the requirements of Section 3807 of the Delaware Business Trust Act.

SECTION 818.      DELEGATION OF POWER.

         (a)      Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 207(a); and

         (b)      The Administrative Trustees shall have power to delegate from
time to time to such of their number or to the Depositor the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Administrative Trustees or otherwise as the Administrative
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 819.      VOTING.

         Except as otherwise provided in this Trust Agreement, the consent or
approval of the Administrative Trustees shall require consent or approval by
not less than a majority of the Administrative Trustees, unless there are only
two, in which case both must consent.

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<PAGE>

                                   ARTICLE IX
                      DISSOLUTION, LIQUIDATION AND MERGER

SECTION 901.      DISSOLUTION UPON EXPIRATION DATE.

         Unless earlier dissolved, the Trust shall automatically dissolve on
December 31, 2032 (the "Expiration Date").

SECTION 902.      EARLY DISSOLUTION.

         The first to occur of any of the following events is an "Early
Termination Event" upon the occurrence of which the Trust shall be dissolved:

         (a)      the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;

         (b)      delivery of written direction to the Property Trustee by the
Depositor at any time (which direction is wholly optional and within the
discretion of the Depositor), subject to the Depositor having received any
required prior approvals under applicable federal or state banking guidelines,
policies or regulations, to dissolve the Trust and distribute the Debentures to
Securityholders in exchange for the Preferred Securities in accordance with
Section 904;

         (c)      the redemption of all of the Preferred Securities in
connection with the redemption or other payment of all of the Debentures;

         (d)      an order for dissolution of the Trust shall have been entered
by a court of competent jurisdiction; and

         (e)      upon the distribution of Common Stock to all Securityholders
upon conversion of all outstanding Preferred Securities.

SECTION 903.      TERMINATION.

         The respective obligations and responsibilities of the Trustees and
the Trust created and continued hereby shall terminate upon the occurrence of
all of the following: (a) the distribution by the Property Trustee to
Securityholders upon the liquidation of the Trust pursuant to Section 904, or
upon the redemption of all of the Trust Securities pursuant to Section 402, of
all amounts required to be distributed hereunder upon the final payment of the
Trust Securities; (b) the payment of any expenses owed by the Trust; (c) the
discharge of all administrative duties of the Administrative Trustees,
including the performance of any tax reporting obligations with respect to the
Trust or the Securityholder; and (d) upon the termination of the Trust, the
filing of a certificate of cancellation with the Office of the Secretary of
State of the State of Delaware.

SECTION 904.      LIQUIDATION.

         (a)      If an Early Termination Event specified in clause (a), (b),
or (d) of Section 902 occurs or upon the Expiration Date, the Trust shall be
liquidated by the Trustees as expeditiously as the Trustees determine to be
possible by distributing, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, to each Securityholder a Like Amount of
Debentures, subject to Section 904(d). Notice of liquidation shall be given by
the Property Trustee by first-class mail, postage prepaid, mailed not later
than 30 nor more than 60 days prior to the Liquidation Date to each Holder of
Trust Securities at such Holder's address appearing in the Securities Register.
All notices of liquidation shall:

                  (i)      state the Liquidation Date;

                  (ii)     state that from and after the Liquidation Date, the
Trust Securities shall no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange shall be deemed to
represent a Like Amount of Debentures;

                                    Page 43
<PAGE>

                  (iii)    provide such information with respect to the
mechanics by which Holders may exchange Trust Securities Certificates for
Debentures, or, if Section 904(d) applies, receive a Liquidation Distribution,
as the Administrative Trustees shall deem appropriate;

                  (iv)     state the CUSIP number (if any); and

                  (v)      state the office or agency of the Trust where
Securities should be surrendered.

         (b)      Except where Section 902(c) or 904(d) applies, in order to
effect the liquidation of the Trust and distribution of the Debentures to
Securityholders, the Property Trustee shall establish a record date for such
distribution (which shall be not more than 45 days prior to the Liquidation
Date) and, either itself acting as exchange agent or through the appointment of
a separate exchange agent, shall establish such procedures as it shall deem
appropriate to effect the distribution of Debentures in exchange for the
Outstanding Trust Securities Certificates.

         (c)      Except where Section 902(c) or 904(d) applies, after the
Liquidation Date, (i) the Trust Securities shall no longer be deemed to be
Outstanding; (ii) certificates representing a Like Amount of Debentures shall
be issued to holders of Trust Securities Certificates upon surrender of such
certificates to the Administrative Trustees or their agent for exchange; (iii)
any Trust Securities Certificates not so surrendered for exchange shall be
deemed to represent a Like Amount of Debentures, accruing interest at the rate
and for the period provided for in the Debentures from the last Distribution
Date on which a Distribution was made on such Trust Securities Certificates
until such certificates are so surrendered (and until such certificates are so
surrendered, no payments of interest or principal shall be made to holders of
Trust Securities Certificates with respect to such Debentures): and (iv) all
rights of Securityholders holding Trust Securities shall cease, except the
right of such Securityholders to receive Debentures upon surrender of Trust
Securities Certificates.

         (d)      In the event that, notwithstanding the other provisions of
this Section 904, whether because of an order for dissolution entered by a
court of competent jurisdiction or otherwise, distribution of the Debentures in
the manner provided herein is determined by the Administrative Trustees not to
be practical, the Trust Property shall be liquidated, and the Trust shall be
wound-up by the Property Trustee in such manner as the Property Trustee
determines. In such event, Securityholders shall be entitled to receive out of
the assets of the Trust available for distribution to Securityholders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the Liquidation Amount per Trust Security plus
accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If, upon any such winding-up 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, subject to the next succeeding sentence, the amounts
payable by the Trust on the Trust Securities shall be paid on a pro rata basis
(based upon Liquidation Amounts). The Holder of the Common Securities shall be
entitled to receive Liquidation Distributions upon any such winding-up pro rata
(determined as aforesaid) with Holders of Preferred Securities, except that, if
a Debenture Event of Default has occurred and is continuing, the Preferred
Securities shall have a priority over the Common Securities.

SECTION 905.      MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE
TRUST.

         The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any Person, except pursuant to this Section
905 or Section 904. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the Holders of the Preferred
Securities or the Property Trustee, the Trust may merge with or into,
consolidate, amalgamate, be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to a trust organized as such
under the laws of any state; provided, that (i) such successor entity either
(a) expressly assumes all of the obligations of the Trust with respect to the
Preferred Securities; or (b) substitutes for the Preferred Securities other
securities having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the same as
the Preferred Securities rank in priority with respect to distributions and
payments upon liquidation, redemption and otherwise; (ii) the Depositor
expressly appoints a trustee of such successor entity possessing substantially
the same powers and duties as the Property Trustee as the holder of the
Debentures; (iii) the Successor Securities are registered or listed, or any
Successor Securities shall be registered or listed upon notification of
issuance, on any national securities exchange or other organization on which
the Preferred

                                    Page 44
<PAGE>

Securities are then registered or listed (including, if applicable, the Nasdaq
National Market), if any; (iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the Preferred
Securities (including any Successor Securities) to be downgraded by any
statistical rating organization knowledgeable in such matters, (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does
not adversely affect the rights, preferences and privileges of the holders of
the Preferred Securities (including any Successor Securities) in any material
respect; (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 Depositor has received an
Opinion of Counsel 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 Preferred
Securities (including any Successor Securities) in any material respect: and
(b) following such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, neither the Trust nor such successor entity
shall be required to register as an "investment company" under the Investment
Company Act, and (viii) the Depositor or any permitted successor or assignee
owns all of the common securities of such successor entity and guarantees the
obligations of such successor entity under the Successor Securities at least to
the extent provided by the Guarantee. Notwithstanding the foregoing, the Trust
shall not, except with the consent of Holders of 100% in Liquidation Amount of
the Preferred Securities, 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 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 the successor entity to be classified as other than a
grantor trust for United States federal income tax purposes.

                                   ARTICLE X
                            MISCELLANEOUS PROVISIONS

SECTION 1001.     LIMITATION OF RIGHTS OF SECURITYHOLDERS.

         The death, incapacity, dissolution, bankruptcy or termination of any
Person having an interest, beneficial or otherwise, in Trust Securities shall
not operate to terminate this Trust Agreement, nor dissolve, terminate or annul
the Trust, nor entitle the legal representatives or heirs of such Person or any
Securityholder for such Person, to claim an accounting, take any action or
bring any proceeding in any court for a partition or winding-up of the
arrangements contemplated hereby, nor otherwise affect the rights, obligations
and liabilities of the parties hereto or any of them.

SECTION 1002.     AMENDMENT.

         (a)      This Trust Agreement may be amended from time to time by the
Trustees and the Depositor, without the consent of any Securityholders, (i) as
provided in Section 811 with respect to acceptance of appointment by a
successor Trustee; (ii) to cure any ambiguity, correct or supplement any
provision herein or therein which may be inconsistent with any other provision
herein or therein, or to make any other provisions with respect to matters or
questions arising under this Trust Agreement, that shall not be inconsistent
with the other provisions of this Trust Agreement; (iii) to modify, eliminate
or add to any provisions of this Trust Agreement to such extent as shall be
necessary to ensure that the Trust shall be classified for United States
federal income tax purposes as a grantor trust at all times that any Trust
Securities are outstanding or to ensure that the Trust shall not be required to
register as an "investment company" under the Investment Company Act; or (iv)
to reduce or increase the Liquidation Amount per Trust Security and
simultaneously to correspondingly increase or decrease the number of Trust
Securities issued and Outstanding solely for the purpose of maintaining the
eligibility of the Preferred Securities for quotation or listing on any
national securities exchange or other organization on which the Preferred
Securities are then quoted or listed (including, if applicable, the Nasdaq
National Market); provided, however, that in the case of clause (ii), such
action shall not adversely affect in any material respect the interests of any
Securityholder, and provided further, that in the case of clause (iv) the
aggregate Liquidation Amount of the Trust Securities Outstanding upon
completion of any such reduction must be the same as the aggregate Liquidation
Amount of the Trust Securities Outstanding immediately prior to such reduction
or increase; and any amendments of this Trust Agreement shall become effective
when notice thereof is given to the Securityholders (or in the case of an
amendment pursuant to clause (iv), as of the date specified in the notice).

                                    Page 45
<PAGE>

         (b)      Except as provided in Section 601(c) or Section 1002(c)
hereof, any provision of this Trust Agreement may be amended by the Trustees
and the Depositor (i) with the consent of Trust Securityholders representing
not less than a majority (based upon Liquidation Amounts) of the Trust
Securities then Outstanding; and (ii) upon receipt by the Trustees of an
Opinion of Counsel to the effect that such amendment or the exercise of any
power granted to the Trustees in accordance with such amendment shall not
affect the Trust's status as a grantor trust for United Status federal income
tax purposes or the Trust's exemption from status of an "investment company"
under the Investment Company Act.

         (c)      In addition to and notwithstanding any other provision in
this Trust Agreement, without the consent of each affected Securityholder (such
consent being obtained in accordance with Section 603 or 606 hereof), this
Trust Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount
of any Distribution required to be made in respect of the Trust Securities as
of a specified date; (ii) restrict the right of a Securityholder to institute
suit for the enforcement of any such payment on or after such date or (iii)
extend the Expiration Date. Notwithstanding any other provision herein, without
the unanimous consent of the Securityholders (such consent being obtained in
accordance with Section 603 or 606 hereof), this paragraph (c) of this Section
1002 may not be amended.

         (d)      Notwithstanding any other provisions of this Trust Agreement,
no Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
status of an "investment company" under the Investment Company Act or to fail
or cease to be classified as a grantor trust for United States federal income
tax purposes.

         (e)      In the event that any amendment to this Trust Agreement is
made, the Administrative Trustees shall promptly provide to the Depositor a
copy of such amendment.

         (f)      Neither the Delaware Trustee nor the Property Trustee shall
be required to enter into any amendment to this Trust Agreement which adversely
affects its own rights, duties or immunities under this Trust Agreement. The
Property Trustee shall be entitled to receive an Opinion of Counsel and an
Officers' Certificate stating that any amendment to this Trust Agreement is in
compliance with this Trust Agreement and that all conditions precedent have
been met.

         (g)      Notwithstanding anything in this Trust Agreement to the
contrary, without the consent of the Depositor, this Trust Agreement may not be
amended in a manner which imposes any additional obligation on the Depositor.

SECTION 1003.     SEPARABILITY.

         In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.

SECTION 1004.     GOVERNING LAW.

         THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST
AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF DELAWARE (WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES).

SECTION 1005.     PAYMENTS DUE ON NON-BUSINESS DAY.

         If the date fixed for any payment on any Trust Security shall be a day
that is not a Business Day, then such payment need not be made on such date but
may be made on the next succeeding day which is a Business Day (except as
otherwise provided in Sections 401(a) and 402(d)), with the same force and
effect as though made on the date fixed for such payment, and no distribution
shall accumulate thereon for the period after such date, if such payment is
made in accordance with the provisions of this Section 1005.

                                    Page 46
<PAGE>

SECTION 1006.     SUCCESSORS.

         This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to the Depositor, the Trust or the Relevant
Trustee(s), including any successor by operation of law. The Depositor shall
not assign its obligations hereunder except as contemplated by Article XII of
the Indenture and unless the assignee thereof agrees in writing, in form and
substance satisfactory to the Property Trustee, to perform all of Depositor's
obligations hereunder with the same effect as if it had been named herein as
Depositor.

SECTION 1007.     HEADINGS.

         The Article and Section headings are for convenience only and shall
not affect the construction of this Trust Agreement.

SECTION 1008.     REPORTS, NOTICES AND DEMANDS.

         Any report, notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be given or
served to or upon any Securityholder or the Depositor may be given or served in
writing by deposit thereof, first-class postage prepaid, in the United States
mail, hand delivery or facsimile transmission, in each case, addressed, (a) in
the case of a Preferred Securityholder, to such Preferred Securityholder as
such Securityholder's name and address may appear on the Securities Register;
and (b) in the case of the Common Securityholder or the Depositor, to Southern
Community Financial Corporation, 4701 Country Club Road, Winston-Salem, North
Carolina 27104. Such notice, demand or other communication to or upon a
Securityholder shall be deemed to have been sufficiently given or made, for all
purposes, upon hand delivery, mailing or transmission.

         Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust, the Property Trustee or the Administrative Trustees shall be given
or served in writing by deposit thereof, first-class postage prepaid, in the
United States mail, hand delivery or facsimile transmission, in each case
addressed (until another address is published by the Trust) as follows: (a)
with respect to the Property Trustee, to Wilmington Trust Company, Rodney
Square North, 1100 North Market Street, Wilmington, Delaware 19890-001,
Attention: Corporate Trust Administration, Facsimile (302) 651-8882; (b) with
respect to the Trust or the Administrative Trustees, to them at the address
above for notices to the Depositor, marked "Attention: Administrative Trustees
of Southern Community Capital Trust I" Such notice, demand or other
communication to or upon the Trust or the Property Trustee shall be deemed to
have been sufficiently given or made only upon actual receipt of the writing by
the Trust or the Property Trustee.

SECTION 1009.     AGREEMENT NOT TO PETITION.

         Each of the Trustees and the Depositor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been dissolved in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code of 1978, as amended) (collectively, "Bankruptcy Laws")
or otherwise join in the commencement of any proceeding against the Trust under
any Bankruptcy Law. In the event the Depositor takes action in violation of
this Section 1009, the Property Trustee agrees, for the benefit of
Securityholders, that at the expense of the Depositor (which expense shall be
paid prior to the filing), it shall file an answer with the bankruptcy court or
otherwise properly contest the filing of such petition by the Depositor against
the Trust or the commencement of such action and raise the defense that the
Depositor has agreed in writing not to take such action and should be estopped
and precluded therefrom. The provisions of this Section 1009 shall survive the
termination of this Trust Agreement.

SECTION 1010.     TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE ACT.

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

                                    Page 47
<PAGE>

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

         (c)      If any provision hereof limits, qualifies or conflicts with
another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provisions shall control. If any provision of this Trust Agreement modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded, the latter provision shall be deemed to apply to this Trust Agreement
as so modified or to be excluded, as the case may be.

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

SECTION 1011.     ACCEPTANCE OF TERMS OF TRUST AGREEMENT, GUARANTEE AND
INDENTURE.

THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON
BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST
SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT
TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE
INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER
AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE
BINDING, OPERATIVE AND EFFECTIVE AS AMONG THE TRUST AND SUCH SECURITYHOLDER AND
SUCH OTHERS.

                  SOUTHERN COMMUNITY FINANCIAL CORPORATION, AS DEPOSITOR

                  By:  /s/ F. Scott Bauer
                     ----------------------------------------------------------
                  Name:    F. Scott Bauer
                       --------------------------------------------------------
                  Title:  President and Chief Executive Officer

                  WILMINGTON TRUST COMPANY, AS PROPERTY TRUSTEE

                  By:  /s/ Patricia A. Evans
                     ----------------------------------------------------------
                  Name: Patricia A. Evans
                       --------------------------------------------------------
                  Title:  Senior Financial Services Officer
                        -------------------------------------------------------

                  WILMINGTON TRUST COMPANY, AS DELAWARE TRUSTEE

                  By:  /s/ Patricia A. Evans
                     ----------------------------------------------------------
                  Name: Patricia A. Evans
                       --------------------------------------------------------
                  Title:  Senior Financial Services Officer
                        -------------------------------------------------------

                                    Page 48
<PAGE>

                  ADMINISTRATIVE TRUSTEES

                  By:  /s/ F. Scott Bauer
                     ----------------------------------------------------------
                  Name:    F. Scott Bauer
                       --------------------------------------------------------
                  Title: As Administrative Trustee

                  /s/ Richard Cobb
                  -------------------------------------------------------------
                  Name: Richard Cobb
                       --------------------------------------------------------
                   Title: As Administrative Trustee

                  /s/ Jeff T. Clark
                  -------------------------------------------------------------
                  Name: Jeff T. Clark
                       --------------------------------------------------------
                  Title: As Administrative Trustee

                                    Page 49

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