Document:

Exhibit
10.2

1ST PACIFIC
BANCORP

as Issuer

INDENTURE

Dated as of June
28, 2007

WILMINGTON TRUST COMPANY

as Trustee

FLOATING RATE JUNIOR SUBORDINATED DEBT SECURITIES DUE
2037

TABLE OF CONTENTS

	
  ARTICLE I DEFINITIONS

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.01

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE II DEBT SECURITIES

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.01

  	
   

  	
  Authentication and Dating

  	
   

  	
  9

  
	
  Section 2.02

  	
   

  	
  Form of Trustee’s Certificate of Authentication

  	
   

  	
  9

  
	
  Section 2.03

  	
   

  	
  Form and Denomination of Debt Securities

  	
   

  	
  10

  
	
  Section 2.04

  	
   

  	
  Execution of Debt Securities

  	
   

  	
  10

  
	
  Section 2.05

  	
   

  	
  Exchange and Registration of Transfer of Debt
  Securities

  	
   

  	
  11

  
	
  Section 2.06

  	
   

  	
  Mutilated, Destroyed, Lost or Stolen Debt Securities

  	
   

  	
  14

  
	
  Section 2.07

  	
   

  	
  Temporary Debt Securities

  	
   

  	
  15

  
	
  Section 2.08

  	
   

  	
  Payment of Interest

  	
   

  	
  15

  
	
  Section 2.09

  	
   

  	
  Cancellation of Debt Securities Paid, etc.

  	
   

  	
  16

  
	
  Section 2.10

  	
   

  	
  Computation of Interest

  	
   

  	
  17

  
	
  Section 2.11

  	
   

  	
  Extension of Interest Payment Period

  	
   

  	
  18

  
	
  Section 2.12

  	
   

  	
  CUSIP Numbers

  	
   

  	
  19

  
	
  Section 2.13

  	
   

  	
  Global Debentures

  	
   

  	
  19

  
	
   

  	
   

  	
   

  
	
  ARTICLE III PARTICULAR COVENANTS OF THE COMPANY

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.01

  	
   

  	
  Payment of Principal, Premium and Interest; Agreed Treatment
  of the Debt Securities

  	
   

  	
  22

  
	
  Section 3.02

  	
   

  	
  Offices for Notices and Payments, etc

  	
   

  	
  23

  
	
  Section 3.03

  	
   

  	
  Appointments to Fill Vacancies in Trustee’s Office

  	
   

  	
  23

  
	
  Section 3.04

  	
   

  	
  Provision as to Paying Agent

  	
   

  	
  23

  
	
  Section 3.05

  	
   

  	
  Certificate to Trustee

  	
   

  	
  24

  
	
  Section 3.06

  	
   

  	
  Additional Amounts

  	
   

  	
  24

  
	
  Section 3.07

  	
   

  	
  Compliance with Consolidation Provisions

  	
   

  	
  25

  
	
  Section 3.08

  	
   

  	
  Limitation on Dividends

  	
   

  	
  25

  
	
  Section 3.09

  	
   

  	
  Covenants as to the Trust

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV LISTS

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.01

  	
   

  	
  Securityholders’ Lists

  	
   

  	
  26

  
	
  Section 4.02

  	
   

  	
  Preservation and Disclosure of Lists

  	
   

  	
  26

  
	
  Section 4.03

  	
   

  	
  Financial and Other Information

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V REMEDIES OF THE TRUSTEE AND
  SECURITYHOLDERS

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.01

  	
   

  	
  Events of Default

  	
   

  	
  29

  
	
  Section 5.02

  	
   

  	
  Payment of Debt Securities on Default; Suit Therefor

  	
   

  	
  31

  
	
  Section 5.03

  	
   

  	
  Application of Moneys Collected by Trustee

  	
   

  	
  32

  

 

 i
 

 

	
  Section 5.04

  	
   

  	
  Proceedings by Securityholders

  	
   

  	
  33

  
	
  Section 5.05

  	
   

  	
  Proceedings by Trustee

  	
   

  	
  33

  
	
  Section 5.06

  	
   

  	
  Remedies Cumulative and Continuing

  	
   

  	
  33

  
	
  Section 5.07

  	
   

  	
  Direction of Proceedings and Waiver of Defaults by
  Majority of Securityholders

  	
   

  	
  34

  
	
  Section 5.08

  	
   

  	
  Notice of Defaults

  	
   

  	
  34

  
	
  Section 5.09

  	
   

  	
  Undertaking to Pay Costs

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI CONCERNING THE TRUSTEE

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.01

  	
   

  	
  Duties and Responsibilities of Trustee

  	
   

  	
  35

  
	
  Section 6.02

  	
   

  	
  Reliance on Documents, Opinions, etc

  	
   

  	
  36

  
	
  Section 6.03

  	
   

  	
  No Responsibility for Recitals, etc.

  	
   

  	
  37

  
	
  Section 6.04

  	
   

  	
  Trustee, Authenticating Agent, Paying Agents,
  Transfer Agents or Registrar May Own Debt Securities

  	
   

  	
  38

  
	
  Section 6.05

  	
   

  	
  Moneys to be Held in Trust

  	
   

  	
  38

  
	
  Section 6.06

  	
   

  	
  Compensation and Expenses of Trustee

  	
   

  	
  38

  
	
  Section 6.07

  	
   

  	
  Officers’ Certificate as Evidence

  	
   

  	
  39

  
	
  Section 6.08

  	
   

  	
  Eligibility of Trustee

  	
   

  	
  39

  
	
  Section 6.09

  	
   

  	
  Resignation or Removal of Trustee

  	
   

  	
  40

  
	
  Section 6.10

  	
   

  	
  Acceptance by Successor Trustee

  	
   

  	
  41

  
	
  Section 6.11

  	
   

  	
  Succession by Merger, etc.

  	
   

  	
  42

  
	
  Section 6.12

  	
   

  	
  Authenticating Agents

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII CONCERNING THE SECURITYHOLDERS

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.01

  	
   

  	
  Action by Securityholders

  	
   

  	
  43

  
	
  Section 7.02

  	
   

  	
  Proof of Execution by Securityholders

  	
   

  	
  44

  
	
  Section 7.03

  	
   

  	
  Who Are Deemed Absolute Owners

  	
   

  	
  44

  
	
  Section 7.04

  	
   

  	
  Debt Securities Owned by Company Deemed Not
  Outstanding

  	
   

  	
  45

  
	
  Section 7.05

  	
   

  	
  Revocation of Consents; Future Holders Bound

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII SECURITYHOLDERS’ MEETINGS

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 8.01

  	
   

  	
  Purposes of Meetings

  	
   

  	
  45

  
	
  Section 8.02

  	
   

  	
  Call of Meetings by Trustee

  	
   

  	
  46

  
	
  Section 8.03

  	
   

  	
  Call of Meetings by Company or Securityholders

  	
   

  	
  46

  
	
  Section 8.04

  	
   

  	
  Qualifications for Voting

  	
   

  	
  46

  
	
  Section 8.05

  	
   

  	
  Regulations

  	
   

  	
  46

  
	
  Section 8.06

  	
   

  	
  Voting

  	
   

  	
  47

  
	
  Section 8.07

  	
   

  	
  Quorum; Actions

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX SUPPLEMENTAL INDENTURES

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.01

  	
   

  	
  Supplemental Indentures without Consent of
  Securityholders

  	
   

  	
  48

  
	
  Section 9.02

  	
   

  	
  Supplemental Indentures with Consent of
  Securityholders

  	
   

  	
  50

  

 

 ii
 

 

	
  Section 9.03

  	
   

  	
  Effect of Supplemental Indentures

  	
   

  	
  51

  
	
  Section 9.04

  	
   

  	
  Notation on Debt Securities

  	
   

  	
  51

  
	
  Section 9.05

  	
   

  	
  Evidence of Compliance of Supplemental Indenture to
  be Furnished to Trustee

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X REDEMPTION OF SECURITIES

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 10.01

  	
   

  	
  Optional Redemption

  	
   

  	
  52

  
	
  Section 10.02

  	
   

  	
  Special Event Redemption

  	
   

  	
  52

  
	
  Section 10.03

  	
   

  	
  Notice of Redemption; Selection of Debt Securities

  	
   

  	
  52

  
	
  Section 10.04

  	
   

  	
  Payment of Debt Securities Called for Redemption

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI CONSOLIDATION, MERGER, SALE, CONVEYANCE
  AND LEASE

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.01

  	
   

  	
  Company May Consolidate, etc., on Certain Terms

  	
   

  	
  53

  
	
  Section 11.02

  	
   

  	
  Successor Entity to be Substituted

  	
   

  	
  54

  
	
  Section 11.03

  	
   

  	
  Opinion of Counsel to be Given to Trustee

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII SATISFACTION AND DISCHARGE OF INDENTURE

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.01

  	
   

  	
  Discharge of Indenture

  	
   

  	
  55

  
	
  Section 12.02

  	
   

  	
  Deposited Moneys to be Held in Trust by Trustee

  	
   

  	
  56

  
	
  Section 12.03

  	
   

  	
  Paying Agent to Repay Moneys Held

  	
   

  	
  56

  
	
  Section 12.04

  	
   

  	
  Return of Unclaimed Moneys

  	
   

  	
  56

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIII IMMUNITY OF INCORPORATORS,
  STOCKHOLDERS, OFFICERS AND DIRECTORS

  	
   

  	
  56

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 13.01

  	
   

  	
  Indenture and Debt Securities Solely Corporate
  Obligations

  	
   

  	
  56

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIV MISCELLANEOUS PROVISIONS

  	
   

  	
  57

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.01

  	
   

  	
  Successors

  	
   

  	
  57

  
	
  Section 14.02

  	
   

  	
  Official Acts by Successor Entity

  	
   

  	
  57

  
	
  Section 14.03

  	
   

  	
  Surrender of Company Powers

  	
   

  	
  57

  
	
  Section 14.04

  	
   

  	
  Addresses for Notices, etc.

  	
   

  	
  57

  
	
  Section 14.05

  	
   

  	
  Governing Law

  	
   

  	
  57

  
	
  Section 14.06

  	
   

  	
  Evidence of Compliance with Conditions Precedent

  	
   

  	
  57

  
	
  Section 14.07

  	
   

  	
  Business Day Convention

  	
   

  	
  58

  
	
  Section 14.08

  	
   

  	
  Table of Contents, Headings, etc.

  	
   

  	
  58

  
	
  Section 14.09

  	
   

  	
  Execution in Counterparts

  	
   

  	
  58

  
	
  Section 14.10

  	
   

  	
  Separability

  	
   

  	
  58

  
	
  Section 14.11

  	
   

  	
  Assignment

  	
   

  	
  58

  
	
  Section 14.12

  	
   

  	
  Acknowledgment of Rights

  	
   

  	
  58

  

 

 iii
 

 

	
  ARTICLE
  XV SUBORDINATION OF DEBT SECURITIES

  	
   

  	
  59

  
	
   

  	
   

  	
   

  
	
  Section 15.01

  	
   

  	
  Agreement to Subordinate

  	
   

  	
  59

  
	
  Section 15.02

  	
   

  	
  Default on Senior Indebtedness

  	
   

  	
  60

  
	
  Section 15.03

  	
   

  	
  Liquidation; Dissolution; Bankruptcy

  	
   

  	
  60

  
	
  Section 15.04

  	
   

  	
  Subrogation

  	
   

  	
  61

  
	
  Section 15.05

  	
   

  	
  Trustee to Effectuate Subordination

  	
   

  	
  62

  
	
  Section 15.06

  	
   

  	
  Notice by the Company

  	
   

  	
  62

  
	
  Section 15.07

  	
   

  	
  Rights of the Trustee; Holders of Senior
  Indebtedness

  	
   

  	
  63

  
	
  Section 15.08

  	
   

  	
  Subordination May Not Be Impaired

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT A

  	
   

  	
  Form of Debt Security

  	
   

  	
   

  
	
  EXHIBIT B

  	
   

  	
  Form of Certificate of Officer of the Company

  	
   

  	
   

  

 

 iv

THIS INDENTURE, dated as of June 28, 2007, between 1st Pacific Bancorp, a bank holding company
incorporated in the State of California (hereinafter sometimes called the “Company”),
and Wilmington Trust Company, a Delaware banking corporation, as trustee (hereinafter
sometimes called the “Trustee”).

W I T N E S S E T H :

WHEREAS, for its lawful corporate purposes, the
Company has duly authorized the issuance of its Floating Rate Junior
Subordinated Debt Securities due 2037 (the “Debt Securities”) under this Indenture
and to provide, among other things, for the execution and authentication,
delivery and administration thereof, the Company has duly authorized the
execution of this Indenture.

NOW, THEREFORE, in consideration of the premises, and
the purchase of the Debt Securities by the holders thereof, the Company
covenants and agrees with the Trustee for the equal and proportionate benefit
of the respective holders from time to time of the Debt Securities as follows:

ARTICLE I

DEFINITIONS

Section 1.01           Definitions.

The terms defined in this Section 1.01 (except as
herein 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 1.01. All
accounting terms used herein and not expressly defined shall have the meanings
assigned to such terms in accordance with generally accepted accounting
principles and the term “generally accepted accounting principles” means such
accounting principles as are generally accepted in the United States at the
time of any computation.  The words “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.

“Additional Amounts” has the meaning set forth in
Section 3.06.

“Additional Provisions” has the meaning set forth in
Section 15.01.

“Administrative Action” has the meaning specified
within the definition of “Tax Event” in this Section 1.01.

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

“Authenticating Agent” means any agent or agents of
the Trustee which at the time shall be appointed and acting pursuant to Section
6.12.

“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 or
the executive committee or any other duly authorized designated officers of the
Company.

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

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

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

“Calculation Agent” means the Person identified as “Trustee”
in the first paragraph hereof with respect to the Debt Securities and the
Institutional Trustee with respect to the Trust Securities.

“Capital Securities” means undivided beneficial
interests in the assets of the Trust which are designated as “MMCapSSM” and rank pari passu with Common Securities issued by the Trust; provided,
however, that if an Event of Default (as defined in the Declaration) has
occurred and is continuing, the rights of holders of such Common Securities to
payment in respect of distributions and payments upon liquidation, redemption
and otherwise are subordinated to the rights of holders of such Capital
Securities.

“Capital Securities Guarantee” means the guarantee
agreement that the Company will enter into with Wilmington Trust Company or
other Persons that operates directly or indirectly for the benefit of holders
of Capital Securities of the Trust.

“Capital Treatment Event” means, if the Company is
organized and existing under the laws of the United States or any state thereof
or the District of Columbia, the receipt by the Company and the Trust of an
Opinion of Counsel experienced in such matters to the effect that, as a result
of any amendment to, or change in, the laws, rules or regulations of the United
States or any political subdivision thereof or therein, or as the result of any
official or administrative pronouncement or action or decision interpreting or
applying such laws, rules or regulations, which amendment or change is
effective or which pronouncement, action or decision is announced on or after
the date of original issuance of the Debt Securities, there is more than an
insubstantial risk that the Company will not, within 90 days of the date of
such opinion, be entitled to treat Capital Securities as “Tier 1 Capital” (or
the then equivalent thereof) for purposes of the capital adequacy guidelines of
the Federal Reserve (or any successor regulatory authority with jurisdiction
over bank holding companies), as then in effect and applicable to the Company; provided, however, that the inability of the Company to treat all or any
portion of the aggregate Liquidation Amount of the Capital Securities as “Tier
1 Capital” shall not constitute the basis for a Capital Treatment Event if such
inability results from the Company having 

 2
 

preferred
stock, minority interests in consolidated subsidiaries and any other class of
security or interest which the Federal Reserve (or any successor regulatory
authority with jurisdiction over bank holding companies) may now or hereafter
accord “Tier 1 Capital” treatment that, in the aggregate, exceed the amount
which may now or hereafter qualify for treatment as “Tier 1 Capital” under
applicable capital adequacy guidelines of the Federal Reserve (or any successor
regulatory authority with jurisdiction over bank holding companies); provided,
further, however, that the distribution of the Debt Securities in
connection with the liquidation of the Trust by the Company shall not in and of
itself constitute a Capital Treatment Event unless such liquidation shall have
occurred in connection with a Tax Event or an Investment Company Event.  For the avoidance of doubt, the inability of
the Company to treat all or any portion of the aggregate Liquidation Amount of
the Capital Securities as “Tier 1 Capital” as a result of the changes effected
by the final rule adopted by the Federal Reserve on March 1, 2005 shall not
constitute the basis for a Capital Treatment Event.

“Certificate” means a certificate signed by any one of
the principal executive officer, the principal financial officer or the
principal accounting officer of the Company.

“Code” means the Internal Revenue Code of 1986, as
amended.

“Common Securities” means undivided beneficial
interests in the assets of the Trust which are designated as “Common Securities”
and rank pari passu with Capital Securities
issued by the Trust; provided, however, that if an Event of
Default (as defined in the Declaration) has occurred and is continuing, the
rights of holders of such Common Securities to payment in respect of
distributions and payments upon liquidation, redemption and otherwise are
subordinated to the rights of holders of such Capital Securities.

“Company” means 1st Pacific Bancorp, a bank holding company
incorporated in the State of California, and, subject to the provisions of
Article XI, shall include its successors and assigns.

“Debt Security” or “Debt Securities” has the meaning
stated in the first recital of this Indenture.

“Debt Security Register” has the meaning specified in
Section 2.05.

“Declaration” means the Amended and Restated
Declaration of Trust of the Trust, dated as of June 28, 2007, as amended or
supplemented from time to time.

“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 set forth in
Section 2.08.

“Deferred Interest” has the meaning set forth in
Section 2.11.

“Depositary” means an organization registered as a
clearing agency under the Exchange Act that is designated as Depositary by the
Company.  DTC will be the initial
Depositary.

 3
 

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

“DTC” means The Depository Trust Company, a New York
corporation.

“Event of Default” means any event specified in
Section 5.01, 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.

“Extension Period” has the meaning set forth in
Section 2.11.

“Federal Reserve” means the Board of Governors of the
Federal Reserve System.

“Global Debenture” means a global certificate that
evidences all or part of the Debt Securities the ownership and transfers of
which shall be reflected and made, as applicable, through book entries by the
Depositary and the Depositary Participants.

“Indenture” means this Indenture as originally
executed or, if amended or supplemented as herein provided, as so amended or
supplemented, or both.

“Institutional Trustee” has the meaning set forth in
the Declaration.

“Interest Payment Date” means March 1, June 1,
September 1 and December 1 of each year, commencing on September 1, 2007,
subject to Section 14.07.

“Interest Period” has the meaning set forth in Section
2.08.

“Interest Rate” means, with respect to any Interest
Period, a per annum rate of interest equal to LIBOR, as determined on the LIBOR
Determination Date for such Interest Period (or, in the case of the first
Interest Period, 5.36%), plus 1.40%; provided, however, that the
Interest Rate for any Interest Period may not exceed the highest rate permitted
by New York law, as the same may be modified by United States law of general
application.

“Investment Company Event” means the receipt by the
Company and the Trust of an Opinion of Counsel experienced in such matters to
the effect that, as a result of a change in law or regulation or written change
in interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority, there is more than an
insubstantial risk that the Trust is or, within 90 days of the date of such
opinion will be, considered an “investment company” that is required to be
registered under the Investment Company Act of 1940, as amended, which change
becomes effective on or after the date of the original issuance of the Debt
Securities.

“LIBOR” means the London Interbank Offered Rate for
three-month U.S. Dollar deposits in Europe as determined by the Calculation
Agent according to Section 2.10(b).

 4
 

“LIBOR Banking Day” has the meaning set forth in
Section 2.10(b)(i).

“LIBOR Business Day” has the meaning set forth in
Section 2.10(b)(i).

“LIBOR Determination Date” has the meaning set forth
in Section 2.10(b)(i).

“Liquidation Amount” means the liquidation amount of
$1,000 per Trust Security.

“Major Depository Institution Subsidiary” means any
subsidiary of the Company that (i) is a depository institution and (ii) meets
the definition of “significant subsidiary” within the meaning of Rule 405 under
the Securities Act.

“Maturity Date” means September 1, 2037, subject to
Section 14.07.

“Officers’ Certificate” means a certificate signed by
the Chairman of the Board, the Vice Chairman, the President or any Vice
President, and by the Chief Financial Officer, the Treasurer, an Assistant
Treasurer, the Comptroller, an Assistant Comptroller, the Secretary or an Assistant
Secretary of the Company, and delivered to the Trustee.  Each such certificate shall include the
statements provided for in Section 14.06 if and to the extent required by the
provisions of such Section.

“Opinion of Counsel” means an opinion in writing
signed by legal counsel, who may be an employee of or counsel to the Company or
may be other counsel reasonably satisfactory to the Trustee.  Each such opinion shall include the
statements provided for in Section 14.06 if and to the extent required by the
provisions of such Section.

The term “outstanding,” when used with reference to
Debt Securities, subject to the provisions of Section 7.04, means, as of any
particular time, all Debt Securities authenticated and delivered by the Trustee
or the Authenticating Agent under this Indenture, except

(a)           Debt Securities theretofore canceled
by the Trustee or the Authenticating Agent or delivered to the Trustee for
cancellation;

(b)           Debt Securities, or portions thereof,
for the payment or redemption of which moneys in the necessary amount shall
have been deposited in trust with the Trustee or with any Paying Agent (other
than the Company) or shall have been set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent); provided,
that, if such Debt Securities, or portions thereof, are to be redeemed prior to
maturity thereof, notice of such redemption shall have been given as provided
in Articles X and XIV or provision satisfactory to the Trustee shall have been
made for giving such notice; and

(c)           Debt Securities paid pursuant to
Section 2.06 or in lieu of or in substitution for which other Debt Securities
shall have been authenticated and delivered pursuant to the terms of Section
2.06 unless proof satisfactory to the Company and the Trustee is presented that
any such Debt Securities are held by bona fide holders in due course.

“Optional Redemption Date” has the meaning set forth
in Section 10.01.

 5
 

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

“Paying Agent” has the meaning set forth in Section
3.04(e).

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

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

“Principal Office of the Trustee” means the office of
the Trustee at which at any particular time its corporate trust business shall
be principally administered, which at all times shall be located within the
United States and at the time of the execution of this Indenture shall be
Rodney Square North, 1100 North Market Street, Wilmington, DE 19890-0001.

“Reference Banks” has the meaning set forth in Section
2.10(b)(ii).

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

“Responsible Officer” means, with respect to the
Trustee, any officer within the Principal Office of the Trustee with direct
responsibility for the administration of the Indenture, including any
vice-president, any assistant vice-president, any secretary, any assistant
secretary, the treasurer, any assistant treasurer, any trust officer or other
officer of the Principal Office of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer
to whom such matter is referred because of that officer’s knowledge of and
familiarity with the particular subject.

“Securities Act” means the Securities Act of 1933, as
amended.

“Securityholder,” “holder of Debt Securities” or other
similar terms, means any Person in whose name at the time a particular Debt
Security is registered on the Debt Security Register.

 6
 

“Senior Indebtedness” means, with respect to the
Company, (i) the principal, premium, if any, and interest in respect of (A)
indebtedness of the Company for money borrowed, as well as similar obligations
arising from off-balance sheet guarantees and direct credit substitutes and (B)
indebtedness evidenced by securities, debentures, notes, bonds or other similar
instruments issued by the Company, (ii) all capital lease obligations of the
Company, (iii) all obligations of the Company issued or assumed as the deferred
purchase price of property, all conditional sale obligations of the Company and
all obligations of the Company under any title retention agreement (but
excluding trade accounts payable and other accrued liabilities arising in the
ordinary course of business), (iv) all obligations of the Company for the
reimbursement of any letter of credit, any banker’s acceptance, any security
purchase facility, any repurchase agreement or similar arrangement, all
obligations associated with derivative products such as interest rate and
foreign exchange contracts and commodity contracts, any interest rate swap, any
other hedging arrangement, any obligation under options or any similar credit
or other transaction, (v) all obligations of the type referred to in clauses
(i) through (iv) above of other Persons for the payment of which the Company is
responsible or liable as obligor, guarantor or otherwise and (vi) all
obligations of the type referred to in clauses (i) through (v) above of other
Persons secured by any lien on any property or asset of the Company (whether or
not such obligation is assumed by the Company), whether the obligations of the
type referred to in clauses (i) through (vi) above were incurred on or prior to
the date of this Indenture or thereafter incurred, unless, with the prior
approval of the Federal Reserve if not otherwise generally approved, it is
provided in the instrument creating or evidencing the same or pursuant to which
the same is outstanding that such obligations are not superior or are pari passu in right of payment to the Debt Securities; provided,
however, that Senior Indebtedness shall not include (A) any debt
securities issued to any trust other than the Trust (or a trustee of such
trust) that is a financing vehicle of the Company (a “financing entity”) in
connection with the issuance by such financing entity of equity or other
securities in transactions substantially similar in structure to the
transactions contemplated hereunder and in the Declaration or (B) any
guarantees of the Company in respect of the equity or other securities of any
financing entity referred to in clause (A) above.

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

“Special Redemption Date” has the meaning set forth in
Section 10.02.

“Special Redemption Price” means, with respect to the
redemption of any Debt Security following a Special Event, an amount in cash
equal to 103.40% of the principal amount of Debt Securities to be redeemed
prior to September 1, 2008 and thereafter equal to the percentage of the
principal amount of the Debt Securities that is specified below for the Special
Redemption Date plus, in each case, unpaid interest accrued thereon to the
Special Redemption Date:

 7
 

 

	
  Special Redemption During the 12-Month

  Period Beginning September 1,

  	
   

  	
  Percentage of Principal Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  102.72

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  102.04

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2010

  	
   

  	
  101.36

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2011

  	
   

  	
  100.68

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2012 and
  thereafter

  	
   

  	
  100.00

  	
  %

  

 

“Subsidiary” means, with respect to any Person, (i)
any corporation, at least a majority of the outstanding voting stock of which
is owned, directly or indirectly, by such Person or one or more of its
Subsidiaries or by such Person and one or more of its Subsidiaries, (ii) any
general partnership, joint venture or similar entity, at least a majority of
the outstanding partnership or similar interests of which shall at the time be
owned by such Person or 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.  For the purposes of this definition, “voting
stock” 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.

“Tax Event” means the receipt by the Company and the
Trust of an Opinion of Counsel experienced in such matters to the effect that,
as a result of any amendment to or change (including any announced prospective
change) in the laws or any regulations thereunder of the United States or any
political subdivision or taxing authority thereof or therein, or as a result of
any official administrative pronouncement (including any private letter ruling,
technical advice memorandum, regulatory procedure, notice or announcement (an “Administrative
Action”)) or judicial decision interpreting or applying such laws or
regulations, regardless of whether such Administrative Action or judicial
decision is issued to or in connection with a proceeding involving the Company
or the Trust and whether or not subject to review or appeal, which amendment,
clarification, change, Administrative Action or decision is enacted,
promulgated or announced, in each case on or after the date of original
issuance of the Debt Securities, there is more than an insubstantial risk that:
(i) the Trust is, or will be within 90 days of the date of such opinion,
subject to United States federal income tax with respect to income received or
accrued on the Debt Securities; (ii) if the Company is organized and existing
under the laws of the United States or any state thereof or the District of
Columbia, interest payable by the Company on the Debt Securities is not, or within
90 days of the date of such opinion, will not be, deductible by the Company, in
whole or in part, for United States federal income tax purposes; or (iii) the
Trust is, or will be within 90 days of the date of such opinion, subject to or
otherwise required to pay, or required to withhold from distributions to
holders of Trust Securities, more than a de minimis amount of other taxes
(including withholding taxes), duties, assessments or other governmental
charges.

“Trust” means FPBN Trust I, the Delaware statutory
trust, or any other similar trust created for the purpose of issuing Capital
Securities in connection with the issuance of Debt Securities under this
Indenture, of which the Company is the sponsor.

 8
 

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

“Trust Securities” means Common Securities and Capital
Securities of the Trust.

“Trustee” means the Person identified as “Trustee” in
the first paragraph hereof, and, subject to the provisions of Article VI
hereof, shall also include its successors and assigns as Trustee hereunder.

“United States” means the United States of America and
the District of Columbia.

“U.S. Person” has the meaning given to United States
Person as set forth in Section 7701(a)(30) of the Code.

ARTICLE
II

DEBT SECURITIES

Section 2.01           Authentication and Dating.

Upon the execution and delivery of this Indenture, or
from time to time thereafter, Debt Securities in an aggregate principal amount
not in excess of $5,155,000 may be executed and delivered by the Company to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
make available for delivery said Debt Securities to or upon the written order
of the Company, signed by its Chairman of the Board of Directors, Vice
Chairman, President or Chief Financial Officer or one of its Vice Presidents,
without any further action by the Company hereunder.  In authenticating such Debt Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Debt Securities, the Trustee shall be entitled to receive, and (subject to
Section 6.01) shall be fully protected in relying upon a copy of any Board
Resolution or Board Resolutions relating thereto and, if applicable, an appropriate
record of any action taken pursuant to such resolution, in each case certified
by the Secretary or an Assistant Secretary or other officers with appropriate
delegated authority of the Company as the case may be.

The Trustee shall have the right to decline to
authenticate and deliver any Debt Securities under this Section if the Trustee,
being advised by counsel, determines that such action may not lawfully be taken
or if a Responsible Officer of the Trustee in good faith shall determine that
such action would expose the Trustee to personal liability to existing
Securityholders.

The definitive Debt Securities shall be typed,
printed, lithographed or engraved on steel engraved borders or may be produced
in any other manner, all as determined by the officers executing such Debt
Securities, as evidenced by their execution of such Debt Securities.

Section 2.02           Form of Trustee’s Certificate of
Authentication.

The Trustee’s certificate of authentication on all
Debt Securities shall be in substantially the following form:

 9
 

This certificate represents Debt Securities referred
to in the within-mentioned Indenture.

	
  

  	
  Wilmington Trust Company,

  
	
   

  	
  not in its
  individual capacity

  
	
   

  	
  but solely as
  trustee

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized
  Officer

  

 

Section 2.03           Form and Denomination of Debt
Securities.

The Debt Securities shall be substantially in the form
of Exhibit A hereto.  The Debt Securities
shall be in registered form without coupons and in minimum denominations of $100,000
and any multiple of $1,000 in excess thereof. 
The Debt Securities shall be numbered, lettered, or otherwise
distinguished in such manner or in accordance with such plans as the officers
executing the same may determine with the approval of the Trustee as evidenced
by the execution and authentication thereof.

Section 2.04           Execution of Debt Securities.

The Debt Securities shall be signed in the name and on
behalf of the Company by the manual or facsimile signature of its Chairman of
the Board of Directors, Vice Chairman, President or Chief Financial Officer or
one of its Executive Vice Presidents, Senior Vice Presidents or Vice
Presidents, under its corporate seal (if legally required) which may be affixed
thereto or printed, engraved or otherwise reproduced thereon, by facsimile or
otherwise, and which need not be attested. 
Only such Debt Securities as shall bear thereon a certificate of
authentication substantially in the form herein before recited, executed by the
Trustee or the Authenticating Agent by the manual or facsimile signature of an
authorized officer, shall be entitled to the benefits of this Indenture or be
valid or obligatory for any purpose. 
Such certificate by the Trustee or the Authenticating Agent upon any
Debt Security executed by the Company shall be conclusive evidence that the
Debt Security so authenticated has been duly authenticated and delivered
hereunder and that the holder is entitled to the benefits of this Indenture.

In case any officer of the Company who shall have
signed any of the Debt Securities shall cease to be such officer before the
Debt Securities so signed shall have been authenticated and delivered by the
Trustee or the Authenticating Agent, or disposed of by the Company, such Debt
Securities nevertheless may be authenticated and delivered or disposed of as
though the Person who signed such Debt Securities had not ceased to be such
officer of the Company; and any Debt Security may be signed on behalf of the
Company by such Persons as, at the actual date of the execution of such Debt
Security, shall be the proper officers of the Company, although at the date of
the execution of this Indenture any such person was not such an officer.

Every Debt Security shall be dated the date of its
authentication.

 10
 

Section 2.05           Exchange and Registration of Transfer
of Debt Securities.

The Company shall cause to be kept, at the office or
agency maintained for the purpose of registration of transfer and for exchange
as provided in Section 3.02, a register (the “Debt Security Register”) for the
Debt Securities issued hereunder in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
and transfer of all Debt Securities as provided in this Article II.  Such register shall be in written form or in
any other form capable of being converted into written form within a reasonable
time.

Debt Securities to be exchanged may be surrendered at
the Principal Office of the Trustee or at any office or agency to be maintained
by the Company for such purpose as provided in Section 3.02, and the Company
shall execute, the Company or the Trustee shall register and the Trustee or the
Authenticating Agent shall authenticate and make available for delivery in
exchange therefor, the Debt Security or Debt Securities which the
Securityholder making the exchange shall be entitled to receive.  Upon due presentment for registration of
transfer of any Debt Security at the Principal Office of the Trustee or at any
office or agency of the Company maintained for such purpose as provided in
Section 3.02, the Company shall execute, the Company or the Trustee shall
register and the Trustee or the Authenticating Agent shall authenticate and
make available for delivery in the name of the transferee or transferees, a new
Debt Security for a like aggregate principal amount. Registration or
registration of transfer of any Debt Security by the Trustee or by any agent of
the Company appointed pursuant to Section 3.02, and delivery of such Debt
Security, shall be deemed to complete the registration or registration of
transfer of such Debt Security.

All Debt Securities presented for registration of
transfer or for exchange or payment shall (if so required by the Company or the
Trustee or the Authenticating Agent) be duly endorsed by, or be accompanied by,
a written instrument or instruments of transfer in form satisfactory to the
Company and either the Trustee or the Authenticating Agent duly executed by,
the holder or such holder’s attorney duly authorized in writing.

No service charge shall be made for any exchange or
registration of transfer of Debt Securities, but the Company or the Trustee may
require payment of a sum sufficient to cover any tax, fee or other governmental
charge that may be imposed in connection therewith other than exchanges
pursuant to Section 2.07, Section 9.04 or Section 10.04 not involving any
transfer.

The Company or the Trustee shall not be required to
exchange or register a transfer of any Debt Security for a period of 15 days
immediately preceding the date of selection of Debt Securities for redemption.

Notwithstanding the foregoing, Debt Securities may not
be transferred prior to the Resale Restriction Termination Date except in
compliance with the legend set forth below, unless otherwise determined by the
Company in accordance with applicable law, which legend shall be placed on each
Debt Security:

 11
 

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

THE HOLDER OF THIS SECURITY OR ANY INTEREST OR
PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY BE,
ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT 

 12
 

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

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

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

 13
 

THIS OBLIGATION IS NOT A DEPOSIT AND IS NOT
INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES,
INCLUDING THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE “FDIC”).  THIS OBLIGATION IS SUBORDINATED TO THE CLAIMS
OF THE DEPOSITORS AND THE CLAIMS OF GENERAL AND SECURED CREDITORS OF THE
COMPANY, IS INELIGIBLE AS COLLATERAL FOR A LOAN BY THE COMPANY OR ANY OF ITS
SUBSIDIARIES AND IS NOT SECURED.

Section 2.06           Mutilated, Destroyed, Lost or Stolen
Debt Securities.

In case any Debt Security shall become mutilated or be
destroyed, lost or stolen, the Company shall execute, and upon its written
request the Trustee shall authenticate and deliver, a new Debt Security bearing
a number not contemporaneously outstanding, in exchange and substitution for
the mutilated Debt Security, or in lieu of and in substitution for the Debt
Security so destroyed, lost or stolen. 
In every case the applicant for a substituted Debt Security shall
furnish to the Company 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 Company and
the Trustee evidence to their satisfaction of the destruction, loss or theft of
such Debt Security and of the ownership thereof.

The Trustee may authenticate any such substituted Debt
Security and deliver the same upon the written request or authorization of any
officer of the Company.  Upon the
issuance of any substituted Debt Security, the Company 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 connected therewith.  In case any Debt Security which has matured
or is about to mature or has been called for redemption in full shall become
mutilated or be destroyed, lost or stolen, the Company may, instead of issuing
a substitute Debt Security, pay or authorize the payment of the same (without
surrender thereof except in the case of a mutilated Debt Security) if the
applicant for such payment shall furnish to the Company and the Trustee such
security or indemnity as may be required by them to save each of them harmless
and, in case of destruction, loss or theft, evidence satisfactory to the
Company and to the Trustee of the destruction, loss or theft of such Security
and of the ownership thereof.

Every substituted Debt Security issued pursuant to the
provisions of this Section 2.06 by virtue of the fact that any such Debt
Security is destroyed, lost or stolen shall constitute an additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Debt Security shall be found at any time, and shall be entitled to all
the benefits of this Indenture equally and proportionately with any and all
other Debt Securities duly issued hereunder. 
All Debt Securities shall be held and owned upon the express condition
that, to the extent permitted by applicable law, the foregoing provisions are
exclusive with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Debt Securities and shall preclude 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.

 14
 

Section 2.07           Temporary Debt Securities.

Pending the preparation of definitive Debt Securities,
the Company may execute and the Trustee shall authenticate and make available
for delivery temporary Debt Securities that are typed, printed or lithographed.
Temporary Debt Securities shall be issuable in any authorized denomination, and
substantially in the form of the definitive Debt Securities but with such
omissions, insertions and variations as may be appropriate for temporary Debt
Securities, all as may be determined by the Company.  Every such temporary Debt Security shall be
executed by the Company and be authenticated by the Trustee upon the same
conditions and in substantially the same manner, and with the same effect, as
the definitive Debt Securities.  Without
unreasonable delay, the Company will execute and deliver to the Trustee or the
Authenticating Agent definitive Debt Securities and thereupon any or all temporary
Debt Securities may be surrendered in exchange therefor, at the Principal
Office of the Trustee or at any office or agency maintained by the Company for
such purpose as provided in Section 3.02, and the Trustee or the Authenticating
Agent shall authenticate and make available for delivery in exchange for such
temporary Debt Securities a like aggregate principal amount of such definitive
Debt Securities.  Such exchange shall be
made by the Company at its own expense and without any charge therefor except
that in case of any such exchange involving a registration of transfer the
Company may require payment of a sum sufficient to cover any tax, fee or other
governmental charge that may be imposed in relation thereto.  Until so exchanged, the temporary Debt
Securities shall in all respects be entitled to the same benefits under this
Indenture as definitive Debt Securities authenticated and delivered hereunder.

Section 2.08           Payment of Interest.

Each Debt Security will bear interest at the then
applicable Interest Rate (i) in the case of the initial Interest Period, for
the period from, and including, the date of original issuance of such Debt
Security to, but excluding, the initial Interest Payment Date and (ii)
thereafter, for the period from, and including, the first day following the end
of the preceding Interest Period to, but excluding, the applicable Interest
Payment Date or, in the case of the last Interest Period, the related Optional
Redemption Date, Special Redemption Date or Maturity Date, as applicable (each
such period, an “Interest Period”), on the principal thereof, on any overdue
principal and (to the extent that payment of such interest is enforceable under
applicable law) on Deferred Interest and on any overdue installment of interest
(including Defaulted Interest), payable (subject to the provisions of Article
XV) on each Interest Payment Date and on the Maturity Date, any Optional
Redemption Date or the Special Redemption Date, as the case may be.  Interest and any Deferred Interest on any
Debt Security that is payable, and is punctually paid or duly provided for by
the Company, on any Interest Payment Date shall be paid to the Person in whose
name such Debt Security (or one or more Predecessor Securities) is registered
at the close of business on the regular record date for such interest
installment, except that interest and any Deferred Interest payable on the
Maturity Date, any Optional Redemption Date or the Special Redemption Date, as
the case may be, other than any Interest Payment Date shall be paid to the
Person to whom principal is paid.  In
case (i) the Maturity Date of any Debt Security or (ii) any Debt
Security or portion thereof is called for redemption and the related Optional Redemption
Date or the Special Redemption Date, as the case may be, is subsequent to the
regular record date with respect to any Interest Payment Date and prior to such
Interest Payment Date, interest on such Debt Security will be paid upon
presentation and surrender of such Debt Security.

 15
 

Any interest on any Debt Security, other than Deferred
Interest, that is payable, but is not punctually paid or duly provided for by
the Company, on any Interest Payment Date (herein called “Defaulted Interest”)
shall forthwith cease to be payable to the holder on the relevant regular
record date by virtue of having been such holder, and such Defaulted Interest
shall be paid by the Company to the Persons in whose names such Debt Securities
(or their respective Predecessor Securities) are registered at the close of
business on a special record date for the payment of such Defaulted Interest,
which shall be fixed in the following manner: 
the Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each such Debt Security and the date
of the proposed payment, and at the same time the Company 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
reasonably 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 provided in this
paragraph.  Thereupon the Trustee shall
fix a special record date for the payment of such Defaulted Interest, which
shall not be more than fifteen nor less than ten days prior to the date of the
proposed payment and not less than ten days after the receipt by the Trustee of
the notice of the proposed payment.  The
Trustee shall promptly notify the Company of such special record date and, in
the name and at the expense of the Company, 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 Securityholder at his or her
address as it appears in the Debt Security Register, not less than ten 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 Debt Securities (or
their respective Predecessor Securities) are registered on  such special record date and thereafter the
Company shall have no further payment obligation in respect of the Defaulted
Interest.

Any interest scheduled to become payable on an
Interest Payment Date occurring during an Extension Period shall not be
Defaulted Interest and shall be payable on such other date as may be specified
in the terms of such Debt Securities.

The term “regular record date”, as used in this
Section, shall mean the fifteenth day prior to the applicable Interest Payment
Date, whether or not such day is a Business Day.

Subject to the foregoing provisions of this Section,
each Debt Security delivered under this Indenture upon registration of transfer
of or in exchange for or in lieu of any other Debt Security shall carry the
rights to interest accrued and unpaid, and to accrue, that were carried by such
other Debt Security.

Section 2.09           Cancellation of Debt Securities Paid,
etc.

All Debt Securities surrendered for the purpose of
payment, redemption, exchange or registration of transfer, shall, if
surrendered to the Company or any Paying Agent, be surrendered to the Trustee
and promptly canceled by it, or, if surrendered to the Trustee or any
Authenticating Agent, shall be promptly canceled by it, and no Debt Securities
shall be issued in lieu thereof except as expressly permitted by any of the provisions
of this Indenture.  All Debt Securities
canceled by any Authenticating Agent shall be delivered to the Trustee.  The

 16

Trustee shall destroy all
canceled Debt Securities unless the Company otherwise directs the Trustee in
writing, in which case the Trustee shall dispose of such Debt Securities as
directed by the Company.  If the Company
shall acquire any of the Debt Securities, however, such acquisition shall not
operate as a redemption or satisfaction of the indebtedness represented by such
Debt Securities unless and until the same are surrendered to the Trustee for
cancellation.

Section 2.10                                Computation
of Interest.

(a)                                  The amount of
interest payable for any Interest Period will be computed on the basis of a
360-day year and the actual number of days elapsed in such Interest Period.

(b)                                 LIBOR shall be
determined by the Calculation Agent for each Interest Period (other than the
first Interest Period, in which case LIBOR will be 5.36% per annum) in
accordance with the following provisions:

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

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

 17
 

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

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

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

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

Section 2.11                                Extension
of Interest Payment Period.

So long as no Event of
Default pursuant to Sections 5.01(b), (e), (f), (g), (h) or (i) of this
Indenture has occurred and is continuing, the Company shall have the right,
from time to time and without causing an Event of Default, to defer payments of
interest on the Debt Securities by extending the interest payment period on the
Debt Securities at any time and from time to time during the term of the Debt
Securities, for up to 20 consecutive quarterly periods (each such extended
interest payment period, together with all previous and further consecutive
extensions thereof, is referred to herein as an “Extension Period”).  No Extension Period may end on a date other
than an Interest Payment Date or extend beyond the Maturity Date, any Optional
Redemption Date or the Special Redemption Date, as the case may be.  During any Extension Period, interest will
continue to accrue on the Debt Securities, and interest on such accrued
interest (such accrued interest and interest thereon referred to herein as “Deferred
Interest”) will accrue at an annual rate equal to the Interest Rate applicable
during such Extension Period, compounded quarterly from the date such Deferred
Interest would have been payable were it not for the Extension Period, to the
extent permitted by applicable law.  No
interest or Deferred Interest (except any Additional Amounts that may be due
and payable) shall be due and payable during an Extension Period, except at the
end thereof.  At the end of any Extension
Period, the Company shall pay all Deferred Interest then accrued and unpaid on
the Debt Securities; provided, however, that during any Extension
Period, the Company shall be subject to the restrictions set forth in Section
3.08.  Prior to the termination of any
Extension Period, the Company may further extend such Extension Period, provided,
that no Extension Period

 18
 

(including all previous
and further consecutive extensions that are part of such Extension Period)
shall exceed 20 consecutive quarterly periods. 
Upon the termination of any Extension Period and upon the payment of all
Deferred Interest, the Company may commence a new Extension Period, subject to
the foregoing requirements.  The Company
must give the Trustee notice of its election to begin or extend an Extension
Period no later than the close of business on the fifteenth Business Day prior
to the applicable Interest Payment Date. 
The Trustee shall give notice of the Company’s election to begin or
extend an Extension Period to the Securityholders, promptly after receipt of
notice from the Company of its election to begin or extend an Extension Period.

Section 2.12                                CUSIP
Numbers.

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

Section 2.13                                Global
Debentures.

(a)                                  Upon the election of
an owner of beneficial interests in outstanding Debt Securities, the Debt
Securities owned by such beneficial owner shall be issued in the form of one or
more Global Debentures.  Each Global
Debenture issued under this Indenture shall be registered in the name of the
Depositary designated by the Company for such Global Debenture or a nominee of
such Depositary and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Debenture shall constitute a single
Debt Security for all purposes of this Indenture.

(b)                                 Notwithstanding any
other provision in this Indenture, no Global Debenture may be exchanged in
whole or in part for Debt Securities in certificated form, and no transfer of a
Global Debenture in whole or in part may be, registered in the name of any
Person other than the Depositary for such Global Debenture or a nominee thereof
unless (i) such Depositary advises the Trustee and the Company in writing that
such Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Debenture, and no
qualified successor is appointed by the Company within ninety (90) days of
receipt by the Company of such notice, (ii) such Depositary ceases to be a
clearing agency registered under the Exchange Act and no successor is appointed
by the Company within ninety (90) days after obtaining knowledge of such event
or (iii) an Event of Default shall have occurred and be continuing.  Upon obtaining knowledge of the occurrence of
any event specified in clause (i), (ii) or (iii) above, the Trustee shall
notify the Depositary and instruct the Depositary to notify all owners of
beneficial interests in such Global Debenture of the occurrence of such event
and of the availability of Debt Securities in certificated form to such
beneficial owners requesting the same. 
Upon the issuance of such Debt Securities in certificated form and the
registration in the Debt Security Register of such Debt Securities in the names
of the holders

 19
 

thereof, the Trustee shall recognize such
holders as holders of Debt Securities for all purposes of this Indenture and
the Debt Securities.

(c)                                  If any Global
Debenture is to be exchanged for Debt Securities in certificated form or
canceled in part, or if a Debt Security in certificated form is to be exchanged
in whole or in part for a beneficial interest in any Global Debenture, then
either (i) such Global Debenture shall be so surrendered for exchange or
cancellation as provided herein or (ii) the principal amount thereof shall be
reduced or increased, subject to Section 2.03, by an amount equal to the portion
thereof to be so exchanged or canceled, or equal to the principal amount of
such Debt Security 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
Debt Security registrar, whereupon the Trustee, in accordance with the
Applicable Depositary Procedures, shall instruct the Depositary or its
authorized representative to make a corresponding adjustment to its
records.  Upon any such surrender or
adjustment of a Global Debenture by the Depositary, accompanied by registration
instructions, the Company shall execute and the Trustee shall authenticate and
deliver Debt Securities issuable in exchange for such Global Debenture (or any
portion thereof) in accordance with the instructions of the Depositary.  The Trustee may conclusively rely on, and
shall be fully protected in relying on, such instructions.

(d)                                 Every Debt Security
authenticated and delivered upon registration of transfer of, or in exchange
for or in lieu of, a Global Debenture or any portion thereof shall be
authenticated and delivered in the form of, and shall be, a Global Debenture,
unless such Debt Security is registered in the name of a Person other than the
Depositary for such Global Debenture or a nominee thereof.

(e)                                  Debt Securities
distributed to holders of Book-Entry Capital Securities (as defined in the
Declaration) upon the dissolution of the Trust shall be distributed in the form
of one or more Global Debentures registered in the name of the Depositary or
its nominee, and deposited with the Debt Securities registrar, as custodian for
such Depositary, or with such Depositary, for credit by the Depositary to the
owners of beneficial interests in such Book-Entry Capital Securities.  Debt Securities distributed to holders of
Capital Securities in certificated form upon the dissolution of the Trust shall
be issued in certificated form.

(f)                                    The Depositary or
its nominee, as the registered owner of a Global Debenture, shall be the holder
of such Global Debenture for all purposes under this Indenture and the Debt
Securities, and owners of beneficial interests in a Global Debenture shall hold
such interests pursuant to the Applicable Depositary Procedures.  Accordingly, any such owner’s beneficial
interest in a Global Debenture 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 its Depositary Participants. 
The Debt Securities registrar and the Trustee shall be entitled to deal
with the Depositary for all purposes of this Indenture relating to a Global
Debenture as the sole holder of the Debt Security and shall have no obligation
to any beneficial owner of a Global Debenture. 
Neither the Trustee nor the Debt Securities registrar shall have any
liability in respect of any transfers affected by the Depositary or its
Depositary Participants.

 20
 

(g)                                 The rights of owners
of beneficial interests in a Global Debenture 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 Depositary Participants.

(h)                                 No owner of any
beneficial interest in any Global Debenture shall have any rights under this
Indenture with respect to such Global Debenture, and the Depositary may be
treated by the Company, the Trustee and any agent of the Company or the Trustee
as the owner and holder of such Global Debenture for all purposes under the
Indenture.  None of the Company, the
Trustee nor any agent of the Company or the Trustee will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in a Global
Debenture or maintaining, supervising or reviewing any records relating to such
beneficial ownership interests. 
Notwithstanding the foregoing, nothing herein shall prevent the Company,
the Trustee or any agent of the Company or the Trustee from giving effect to
any written certification, proxy or other authorization furnished by the Depositary
or impair, as between the Depositary and such beneficial owners, the operation
of customary practices governing the exercise of the rights of the Depositary
or its nominee as holder of any Debt Security.

(i)                                     Global Debentures shall bear the following
legend on the face thereof:

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

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

 21
 

ARTICLE
III

PARTICULAR COVENANTS OF THE COMPANY

Section 3.01                                Payment
of Principal, Premium and Interest; Agreed Treatment of the Debt Securities.

(a)                                  The Company covenants
and agrees that it will duly and punctually pay or cause to be paid all
payments due in respect of the Debt Securities at the place, at the respective
times and in the manner provided in this Indenture and the Debt
Securities.  Payment of the principal of
and premium, if any, and interest on the Debt Securities due on the Maturity
Date, any Optional Redemption Date or the Special Redemption Date, as the case
may be, will be made by the Company in immediately available funds against
presentation and surrender of such Debt Securities.  At the option of the Company, each
installment of interest on the Debt Securities due on an Interest Payment Date
other than the Maturity Date, any Optional Redemption Date or the Special
Redemption Date, as the case may be, may be paid (i) by mailing checks for such
interest payable to the order of the holders of Debt Securities entitled
thereto as they appear on the Debt Security Register or (ii) by wire transfer
of immediately available funds to any account with a banking institution
located in the United States designated by such holders to the Paying Agent no
later than the related record date. 
Notwithstanding anything to the contrary contained in this Indenture or
any Debt Security, if the Trust or the trustee of the Trust is the holder of
any Debt Security, then all payments in respect of such Debt Security shall be
made by the Company in immediately available funds when due.

(b)                                 The Company will treat
the Debt Securities as indebtedness, and the interest payable in respect of
such Debt Securities (including any Additional Amounts) as interest, for all
U.S. federal income tax purposes.  All payments
in respect of such Debt Securities will be made free and clear of U.S.
withholding tax provided, that (i) any beneficial owner thereof that is a “United
States person” within the meaning of Section 7701(a)(30) of the Code (A) has
provided an Internal Revenue Service Form W-9 (or any substitute or successor
form) in the manner required establishing its status as a “United States person”
for U.S. federal income tax purposes, and (B) the Internal Revenue Service has
neither notified the Issuer that the taxpayer identification number furnished
by such beneficial owner is incorrect nor notified the Issuer that there is
underreporting by such beneficial owner, and (ii) any beneficial owner thereof
that is not a “United States person” within the meaning of Section 7701(a)(30)
of the Code has provided an Internal Revenue Service Form W-8 BEN, Internal
Revenue Service Form W-8ECI, or Internal Revenue Service Form W-8EXP, as
applicable (or any substitute or successor form) in the manner required
establishing its non-U.S. status for U.S. federal income tax purposes.

(c)                                  As of the date of
this Indenture, the Company represents that it has no intention to exercise its
right under Section 2.11 to defer payments of interest on the Debt Securities
by commencing an Extension Period.

(d)                                 As of the date of this
Indenture, the Company represents that the likelihood that it would exercise
its right under Section 2.11 to defer payments of interest on the Debt
Securities by commencing an Extension Period at any time during which the Debt
Securities are outstanding is remote because of the restrictions that would be
imposed on the Company’s ability to declare or pay dividends or distributions
on, or to redeem, purchase or

 22
 

make a liquidation payment with respect to,
any of its outstanding equity and on the Company’s ability to make any payments
of principal of or premium, if any, or interest on, or repurchase or redeem,
any of its debt securities that rank pari passu in
all respects with or junior in interest to the Debt Securities.

Section 3.02                                Offices
for Notices and Payments, etc.

So long as any of the Debt Securities remain
outstanding, the Company will maintain in Wilmington, Delaware or in
Sacramento, California an office or agency where the Debt Securities may be
presented for payment, an office or agency where the Debt Securities may be
presented for registration of transfer and for exchange as provided in this
Indenture and an office or agency where notices and demands to or upon the
Company in respect of the Debt Securities or of this Indenture may be served.  The Company will give to the Trustee written
notice of the location of any such office or agency and of any change of
location thereof.  Until otherwise
designated from time to time by the Company in a notice to the Trustee, or
specified as contemplated by Section 2.05, such office or agency for all of the
above purposes shall be the Principal Office of the Trustee.  In case the Company shall fail to maintain
any such office or agency in Wilmington, Delaware or in Sacramento, California,
or shall fail to give such notice of the location or of any change in the
location thereof, presentations and demands may be made and notices may be
served at the Principal Office of the Trustee.

In addition to any such office or agency, the Company
may from time to time designate one or more offices or agencies outside
Wilmington, Delaware or Sacramento, California where the Debt Securities may be
presented for registration of transfer and for exchange in the manner provided
in this Indenture, and the Company may from time to time rescind such
designation, as the Company may deem desirable or expedient; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain any such office or agency in Wilmington, Delaware
or in Sacramento, California for the purposes above mentioned.  The Company will give to the Trustee prompt
written notice of any such designation or rescission thereof.

Section 3.03                                Appointments
to Fill Vacancies in Trustee’s Office.

The Company, whenever necessary to avoid or fill a
vacancy in the office of Trustee, will appoint, in the manner provided in
Section 6.09, a Trustee, so that there shall at all times be a Trustee
hereunder.

Section 3.04                                Provision
as to Paying Agent.

(a)                                  If the Company shall
appoint a Paying Agent other than the Trustee, it will cause such Paying Agent
to execute and deliver to the Trustee an instrument in which such agent shall
agree with the Trustee, subject to the provision of this Section 3.04,

(i)                                     that
it will hold all sums held by it as such agent for the payment of all payments
due on the Debt Securities (whether such sums have been paid to it by the
Company or by any other obligor on the Debt Securities) in trust for the
benefit of the holders of the Debt Securities;

 23
 

(ii)                                  that
it will give the Trustee prompt written notice of any failure by the Company
(or by any other obligor on the Debt Securities) to make any payment on  the Debt Securities when the same shall be
due and payable; and

(iii)                               that
it will, at any time during the continuance of any Event of Default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held
in trust by such Paying Agent.

(b)                                 If the Company shall
act as its own Paying Agent, it will, on or before each due date of the
payments due on the Debt Securities, set aside, segregate and hold in trust for
the benefit of the holders of the Debt Securities a sum sufficient to make such
payments so becoming due and will notify the Trustee in writing of any failure
to take such action and of any failure by the Company (or by any other obligor
under the Debt Securities) to make any payment on the Debt Securities when the
same shall become due and payable.

Whenever the Company shall have one or more Paying
Agents for the Debt Securities, it will, on or prior to each due date of the
payments on the Debt Securities, deposit with a Paying Agent a sum sufficient
to pay all payments so becoming due, such sum to be held in trust for the
benefit of the Persons entitled thereto and (unless such Paying Agent is the
Trustee) the Company shall promptly notify the Trustee in writing of its action
or failure to act.

(c)                                  Anything in this
Section 3.04 to the contrary notwithstanding, the Company may, at any time, for
the purpose of obtaining a satisfaction and discharge with respect to the Debt
Securities, or for any other reason, pay, or direct any Paying Agent to pay, to
the Trustee all sums held in trust by the Company or any such Paying Agent,
such sums to be held by the Trustee upon the same terms and conditions herein
contained.

(d)                                 Anything in this
Section 3.04 to the contrary notwithstanding, the agreement to hold sums in
trust as provided in this Section 3.04 is subject to Sections 12.03 and 12.04.

(e)                                  The Company hereby
initially appoints the Trustee to act as paying agent for the Debt Securities
(the “Paying Agent”).

Section 3.05                                Certificate
to Trustee.

The Company will deliver to the Trustee on or before
120 days after the end of each fiscal year, so long as Debt Securities are outstanding
hereunder, a Certificate, substantially in the form of Exhibit B attached
hereto, stating that in the course of the performance by the signers of their
duties as officers of the Company they would normally have knowledge of any
default by the Company in the performance of any covenants of the Company
contained herein, stating whether or not they have knowledge of any such
default and, if so, specifying each such default of which the signers have
knowledge and the nature thereof.

Section 3.06                                Additional
Amounts.

If and for so long as the Trust is the holder of all
Debt Securities and is subject to or otherwise required to pay (or is required
to withhold from distributions to holders of Trust

 24
 

Securities) any
additional taxes (including withholding taxes), duties, assessments or other
governmental charges as a result of a Tax Event, the Company will pay such
additional amounts (the “Additional Amounts”) on the Debt Securities or the
Trust Securities, as the case may be, as shall be required so that the net
amounts received and retained by the holders of Debt Securities or Trust
Securities, as the case may be, after payment of all taxes (including
withholding taxes), duties, assessments or other governmental charges, will be
equal to the amounts that such holders would have received and retained had no
such taxes (including withholding taxes), duties, assessments or other
governmental charges been imposed.

Whenever in this Indenture or the Debt Securities
there is a reference in any context to the payment of principal of or premium,
if any, or interest on the Debt Securities, such mention shall be deemed to
include mention of payments of the Additional Amounts provided for in this
Section to the extent that, in such context, Additional Amounts are, were or
would be payable in respect thereof pursuant to the provisions of this Section
and express mention of the payment of Additional Amounts (if applicable) in any
provisions hereof shall not be construed as excluding Additional Amounts in
those provisions hereof where such express mention is not made, provided,
however, that, notwithstanding anything to the contrary contained in
this Indenture or any Debt Security, the deferral of the payment of interest
during an Extension Period pursuant to Section 2.11 shall not defer the payment
of any Additional Amounts that may be due and payable.

Section 3.07                                Compliance
with Consolidation Provisions.

The Company will not, while any of the Debt Securities
remain outstanding, consolidate with, or merge into, any other Person, or merge
into itself, or sell, convey, transfer or otherwise dispose of all or
substantially all of its property or capital stock to any other Person unless
the provisions of Article XI hereof are complied with.

Section 3.08                                Limitation
on Dividends.

If (i) there shall have occurred and be continuing a
Default or an Event of Default, (ii) the Company shall be in default with
respect to its payment of any obligations under the Capital Securities
Guarantee or (iii) the Company shall have given notice of its election to defer
payments of interest on the Debt Securities by extending the interest payment
period as provided herein and such period, or any extension thereof, shall have
commenced and be continuing, then the Company may not (A) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company’s capital stock, (B)
make any payment of principal of or premium, if any, or interest on or repay,
repurchase or redeem any debt securities of the Company that rank pari passu in all respects with or junior in interest to the
Debt Securities or (C) make any payment under any guarantees of the Company
that rank pari passu in all respects with or
junior in interest to the Capital Securities Guarantee (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of
the Company (I) in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, (II) in connection with a dividend
reinvestment or stockholder stock purchase plan or (III) in connection with the
issuance of capital stock of the Company (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into

 25
 

prior to the occurrence
of (i), (ii) or (iii) above, (b) as a result of any exchange or conversion of
any class or series of the Company’s capital stock (or any capital stock of a subsidiary
of the Company) for any class or series of the Company’s capital stock or of
any class or series of the Company’s indebtedness for any class or series of
the Company’s capital stock, (c) the purchase of fractional interests in shares
of the Company’s capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(d) any declaration of a dividend in connection with any stockholder’s rights
plan, or the issuance of rights, stock or other property under any stockholder’s
rights plan, or the redemption or repurchase of rights pursuant thereto or (e)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior in interest to
such stock).

Section 3.09                                Covenants
as to the Trust.

For so long as such Trust Securities remain
outstanding, the Company shall maintain 100% ownership of the Common
Securities; provided, however, that any permitted successor of
the Company under this Indenture may succeed to the Company’s ownership of such
Common Securities.  The Company, as owner
of the Common Securities, shall use commercially reasonable efforts to cause
the Trust (a) to remain a statutory trust, except in connection with a
distribution of Debt Securities to the holders of Trust Securities in
liquidation of the Trust, the redemption of all of the Trust Securities or
mergers, consolidations or amalgamations, each as permitted by the Declaration,
(b) to otherwise continue to be classified as a grantor trust for United States
federal income tax purposes and (c) to cause each holder of Trust Securities to
be treated as owning an undivided beneficial interest in the Debt Securities.

ARTICLE
IV

LISTS

Section 4.01                                Securityholders’
Lists.

The Company covenants and agrees that it will furnish
or cause to be furnished to the Trustee:

(a)                                  on each regular record
date for an Interest Payment Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Securityholders of the
Debt Securities as of such record date; and

(b)                                 at such other times as
the Trustee may request in writing, within 30 days after the receipt by the
Company of any such request, a list of similar form and content as of a date
not more than 15 days prior to the time such list is furnished; except that no
such lists need be furnished under this Section 4.01 so long as the Trustee is
in possession thereof by reason of its acting as Debt Security registrar.

Section 4.02                                Preservation
and Disclosure of Lists.

(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 Debt Securities (1)

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contained in the most recent list furnished
to it as provided in Section 4.01 or (2) received by it in the capacity of Debt
Securities registrar (if so acting) hereunder. 
The Trustee may destroy any list furnished to it as provided in Section
4.01 upon receipt of a new list so furnished.

(b)                                 In case three or more
holders of Debt Securities (hereinafter referred to as “applicants”) apply in
writing to the Trustee and furnish to the Trustee reasonable proof that each
such applicant has owned a Debt Security for a period of at least six months
preceding the date of such application, and such application states that the
applicants desire to communicate with other holders of Debt Securities with respect
to their rights under this Indenture or under such Debt Securities and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Trustee shall within five Business
Days after the receipt of such application, at its election, either:

(i)                                     afford
such applicants access to the information preserved at the time by the Trustee
in accordance with the provisions of subsection (a) of this Section 4.02, or

(ii)                                  inform
such applicants as to the approximate number of holders of Debt Securities
whose names and addresses appear in the information preserved at the time by
the Trustee in accordance with the provisions of subsection (a) of this Section
4.02, and as to the approximate cost of mailing to such Securityholders the
form of proxy or other communication, if any, specified in such application.

If the Trustee shall elect not to afford such
applicants access to such information, the Trustee shall, upon the written
request of such applicants, mail to each Securityholder of Debt Securities
whose name and address appear in the information preserved at the time by the
Trustee in accordance with the provisions of subsection (a) of this Section
4.02 a copy of the form of proxy or other communication which is specified in
such request with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender, the
Trustee shall mail to such applicants and file with the Securities and Exchange
Commission, if permitted or required by applicable law, together with a copy of
the material to be mailed, a written statement to the effect that, in the
opinion of the Trustee, such mailing would be contrary to the best interests of
the holders of all Debt Securities, as the case may be, or would be in
violation of applicable law.  Such
written statement shall specify the basis of such opinion.  If said Commission, as permitted or required
by applicable law, after opportunity for a hearing upon the objections
specified in the written statement so filed, shall enter an order refusing to
sustain any of such objections or if, after the entry of an order sustaining
one or more of such objections, said Commission shall find, after notice and
opportunity for hearing, that all the objections so sustained have been met and
shall enter an order so declaring, the Trustee shall mail copies of such
material to all such Securityholders with reasonable promptness after the entry
of such order and the renewal of such tender; otherwise the Trustee shall be
relieved of any obligation or duty to such applicants respecting their
application.

(c)                                  Each and every holder
of Debt Securities, by receiving and holding the same, agrees with the Company
and the Trustee that none of the Company, the Trustee or any Paying Agent shall
be held accountable by reason of the disclosure of any such information as to

 27
 

the names and addresses of the holders of
Debt Securities in accordance with the provisions of subsection (b) of this
Section 4.02, regardless of the source from which such information was derived,
and that the Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under said subsection (b).

Section 4.03                                Financial
and Other Information.

(a)                                  The Company shall
deliver, by hardcopy or electronic transmission, to each Securityholder (i)
each Report on Form 10-K and Form 10-Q, if any, prepared by the Company and
filed with the Securities and Exchange Commission in accordance with the
Exchange Act within 10 Business Days after the filing thereof or (ii) if the
Company is (a) not then subject to Section 13 or 15(d) of the Exchange Act (a “Private
Entity”) or (b) exempt from reporting pursuant to Rule 12g3-2(b) thereunder,
the information required by Rule 144A(d)(4) under the Securities Act.  Notwithstanding the foregoing, so long as a
Holder of the Debt Securities is Citigroup Global Markets Inc. or an entity
that holds a pool of trust preferred securities and/or debt securities as
collateral for its securities or a trustee thereof, and the Company is (i) a
Private Entity that, on the date of original issuance of the Debt Securities,
is required to provide audited consolidated financial statements to its primary
regulatory authority, (ii) a Private Entity that, on the date of original
issuance of the Debt Securities, is not required to provide audited
consolidated financial statements to its primary regulatory authority but subsequently
becomes subject to the audited consolidated financial statement reporting
requirements of that regulatory authority or (iii) subject to Section 13 or
15(d) of the Exchange Act on the date of original issuance of the Debt
Securities or becomes so subject after the date hereof but subsequently becomes
a Private Entity, then, within 90 days after the end of each fiscal year,
beginning with the fiscal year in which the Debt Securities were originally
issued if the Company was then subject to (x) Section 13 or 15(d) of the
Exchange Act or (y) audited consolidated financial statement reporting
requirements of its primary regulatory authority or, otherwise, the earliest
fiscal year in which the Company becomes subject to (1) Section 13 or 15(d) of
the Exchange Act or (2) the audited consolidated financial statement reporting
requirements of its primary regulatory authority, the Company shall deliver, by
hardcopy or electronic transmission, to each Securityholder, unless otherwise
provided pursuant to the preceding sentence, (A) a copy of the Company’s
audited consolidated financial statements (including balance sheet and income
statement) covering the related annual period and (B) the report of the
independent accountants with respect to such financial statements.  In addition to the foregoing, the Company
shall deliver to each Securityholder within 30 days after the end of the fiscal
year of the Company, Form 1099 or such other annual U.S. federal income tax
information statement required by the Code containing such information with
regard to the Debt Securities held by such holder as is required by the Code
and the income tax regulations of the U.S. Treasury thereunder.

(b)                                 If and so long as the
Holder of the Debt Securities is Citigroup Global Markets Inc. or an entity
that holds a pool of trust preferred securities and/or debt securities or a
trustee thereof, the Company will cause copies of its reports on Forms FR Y-9C,
FR Y-9LP and FR Y-6 to be delivered to such Holder promptly following their
filing with the Federal Reserve.

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ARTICLE
V

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS

Section 5.01                                Events
of Default.

The following events shall be “Events of Default” with
respect to Debt Securities:

(a)                                  the Company defaults
in the payment of any interest upon any Debt Security when it becomes due and
payable, and continuance of such default for a period of 30 days; for the
avoidance of doubt, an extension of any interest payment period by the Company
in accordance with Section 2.11 of this Indenture shall not constitute a
default under this clause 5.01(a); or

(b)                                 the Company defaults
in the payment of any interest upon any Debt Security, including any Additional
Amounts in respect thereof, following the nonpayment of any such interest for
twenty or more consecutive Interest Periods; or

(c)                                  the Company defaults
in the payment of all or any part of the principal of (or premium, if any, on)
any Debt Securities as and when the same shall become due and payable, whether
at maturity, upon redemption, by acceleration of maturity pursuant to Section
5.01 of this Indenture or otherwise; or

(d)                                 the Company defaults
in the performance of, or breaches, any of its covenants or agreements in
Sections 3.06, 3.07, 3.08 or 3.09 of this Indenture (other than a covenant or
agreement a default in whose performance or whose breach is elsewhere in this
Section specifically dealt with), and continuance of such default or breach for
a period of 90 days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee by the
holders of not less than 25% in aggregate principal amount of the outstanding
Debt 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)                                  a court having
jurisdiction in the premises shall enter a decree or order for relief in
respect of the Company in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or appoints a
receiver, liquidator, assignee, custodian, trustee, sequestrator or other
similar official of the Company or for any substantial part of its property, or
orders the winding-up or liquidation of its affairs and such decree,
appointment or order shall remain unstayed and in effect for a period of 90
consecutive days; or

(f)                                    the Company shall
commence a voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, shall consent to the entry of an order
for relief in an involuntary case under any such law, or shall consent to the
appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Company or of
any substantial part of its property, or shall make any general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due; or

 29
 

(g)                                 a court or
administrative or governmental agency or body shall enter a decree or order for
the appointment of a receiver of a Major Depository Institution Subsidiary or
all or substantially all of its property in any liquidation, insolvency or
similar proceeding with respect to such Major Depository Institution Subsidiary
or all or substantially all of its property; or

(h)                                 a Major Depository
Institution Subsidiary shall consent to the appointment of a receiver for it or
all or substantially all of its property in any liquidation, insolvency or
similar proceeding with respect to it or all or substantially all of its
property; or

(i)                                     the Trust shall
have voluntarily or involuntarily liquidated, dissolved, wound-up its business
or otherwise terminated its existence except in connection with (1) the
distribution of the Debt Securities to holders of the Trust Securities in
liquidation of their interests in the Trust, (2) the redemption of all of the
outstanding Trust Securities or (3) mergers, consolidations or amalgamations,
each as permitted by the Declaration.

If an Event of Default specified under clause (b) of
this Section 5.01 occurs and is continuing with respect to the Debt Securities,
then, in each and every such case, either the Trustee or the holders of not
less than 25% in aggregate principal amount of the Debt Securities then
outstanding hereunder, by notice in writing to the Company (and to the Trustee
if given by Securityholders), may declare the entire principal of the Debt
Securities and any premium and interest accrued, but unpaid, thereon to be due
and payable immediately, and upon any such declaration the same shall become
immediately due and payable.  If an Event
of Default specified under clause (e), (f), (g), (h) or (i) of this Section
5.01 occurs, then, in each and every such case, the entire principal amount of
the Debt Securities and any premium and interest accrued, but unpaid, thereon
shall ipso  facto become immediately due and payable without
further action.

The foregoing provisions, however, are subject to the
condition that if, at any time after the principal of the Debt Securities shall
have become due by acceleration, and before any judgment or decree for the
payment of the moneys due shall have been obtained or entered as hereinafter
provided, (i) the Company shall pay or shall deposit with the Trustee a sum
sufficient to pay all matured installments of interest upon all the Debt
Securities and all payments on the Debt Securities which shall have become due
otherwise than by acceleration (with interest upon all such payments and
Deferred Interest, to the extent permitted by law) and such amount as shall be
sufficient to cover reasonable compensation to the Trustee and each predecessor
Trustee, their respective agents, attorneys and counsel, and all other amounts
due to the Trustee pursuant to Section 6.06, if any, and (ii) all Events of
Default under this Indenture, other than the non-payment of the payments in
respect of Debt Securities which shall have become due by acceleration, shall
have been cured, waived or otherwise remedied as provided herein, then, in each
and every such case, the holders of a majority in aggregate principal amount of
the Debt Securities then outstanding, by written notice to the Company and to
the Trustee, may waive all defaults and rescind and annul such acceleration and
its consequences, but no such waiver or rescission and annulment shall extend
to or shall affect any subsequent default or shall impair any right consequent
thereon; provided, however, that if the Debt Securities are held
by the Trust or a trustee of the Trust, such waiver or rescission and annulment
shall not be effective until the

 30
 

holders of a majority in
aggregate liquidation amount of the outstanding Capital Securities of the Trust
shall have consented to such waiver or rescission and annulment.

In case the Trustee shall have proceeded to enforce
any right under this Indenture and such proceedings shall have been
discontinued or abandoned because of such rescission or annulment or for any
other reason or shall have been determined adversely to the Trustee, then and
in every such case the Company, the Trustee and the holders of the Debt
Securities shall be restored respectively to their several positions and rights
hereunder, and all rights, remedies and powers of the Company, the Trustee and
the holders of the Debt Securities shall continue as though no such proceeding
had been taken.

Section 5.02                                Payment
of Debt Securities on Default; Suit Therefor.

The Company covenants that upon the occurrence of an
Event of Default pursuant to clause (b) of Section 5.01 and upon demand of
the Trustee, the Company will pay to the Trustee, for the benefit of the
holders of the Debt Securities, the whole amount that then shall have become
due and payable on all Debt Securities, including Deferred Interest accrued on
the Debt Securities; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including a
reasonable compensation to the Trustee, its agents, attorneys and counsel, and
any other amounts due to the Trustee under Section 6.06.  In case the Company shall fail forthwith to
pay such amounts upon such demand, the Trustee, in its own name and as trustee
of an express trust, shall be entitled and empowered to institute any actions
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 Company
or any other obligor on such Debt Securities and collect in the manner provided
by law out of the property of the Company or any other obligor on such Debt
Securities wherever situated the moneys adjudged or decreed to be payable.

In case there shall be pending proceedings for the
bankruptcy or for the reorganization of the Company or any other obligor on the
Debt Securities under Bankruptcy Law, or in case a receiver or trustee shall
have been appointed for the property of the Company or such other obligor, or
in the case of any other similar judicial proceedings relative to the Company
or other obligor upon the Debt Securities, or to the creditors or property of
the Company or such other obligor, the Trustee, irrespective of whether the
principal of the Debt Securities shall then be due and payable as therein
expressed or by acceleration or otherwise and irrespective of whether the
Trustee shall have made any demand pursuant to the provisions of this Section
5.02, shall be entitled and empowered, by intervention in such proceedings or
otherwise, to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Debt Securities and,
in case of any judicial proceedings, to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for reasonable compensation to the
Trustee and each predecessor Trustee, and their respective agents, attorneys
and counsel, and for reimbursement of all other amounts due to the Trustee
under Section 6.06) and of the Securityholders allowed in such judicial
proceedings relative to the Company or any other obligor on the Debt
Securities, or to the creditors or property of the Company or such other
obligor, unless prohibited by applicable law and regulations, to vote on behalf
of the holders of the Debt Securities in any election of a trustee or a standby
trustee in arrangement,

 31

reorganization,
liquidation or other bankruptcy or insolvency proceedings or Person performing
similar functions in comparable proceedings, and to collect and receive any
moneys or other property payable or deliverable on any such claims, and to
distribute the same after the deduction of its charges and expenses; and any
receiver, assignee or trustee in bankruptcy or reorganization is hereby
authorized by each of the Securityholders to make such payments to the Trustee,
and, in the event that the Trustee shall consent to the making of such payments
directly to the Securityholders, to pay to the Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Trustee, each predecessor
Trustee and their respective agents, attorneys and counsel, and all other
amounts due to the Trustee under Section 6.06.

Nothing herein contained shall be construed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Debt Securities or the rights of any holder thereof
or to authorize the Trustee to vote in respect of the claim of any
Securityholder in any such proceeding.

All rights of action and of asserting claims under
this Indenture, or under any of the Debt Securities, may be enforced by the
Trustee without the possession of any of the Debt Securities, or the production
thereof at any trial or other proceeding relative 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 be for the
ratable benefit of the holders of the Debt Securities.

In any proceedings brought by the Trustee (and also
any proceedings involving the interpretation of any provision of this Indenture
to which the Trustee shall be a party), the Trustee shall be held to represent
all the holders of the Debt Securities, and it shall not be necessary to make
any holders of the Debt Securities parties to any such proceedings.

Section 5.03                                Application
of Moneys Collected by Trustee.

Any moneys collected by the Trustee shall be applied
in the following order, at the date or dates fixed by the Trustee for the
distribution of such moneys, upon presentation of the several Debt Securities
in respect of which moneys have been collected, and stamping thereon the
payment, if only partially paid, and upon surrender thereof if fully paid:

First: To the payment of costs and expenses incurred
by, and reasonable fees of, the Trustee, its agents, attorneys and counsel, and
of all other amounts due to the Trustee under Section 6.06;

Second: To the payment of all Senior Indebtedness of
the Company if and to the extent required by Article XV;

Third:  To the
payment of the amounts then due and unpaid upon Debt Securities, in respect of
which or for the benefit of which money has been collected, ratably, without
preference or priority of any kind, according to the amounts due upon such Debt
Securities; and

Fourth: The balance, if any, to the Company.

 32
 

Section 5.04                                Proceedings
by Securityholders.

No holder of any Debt Security shall have any right to
institute any suit, action or proceeding for any remedy hereunder, unless such
holder previously shall have given to the Trustee written notice of an Event of
Default with respect to the Debt Securities and unless the holders of not less
than 25% in aggregate principal amount of the Debt Securities then outstanding
shall have given the Trustee a written request to institute such action, suit
or proceeding and shall have offered to the Trustee such reasonable indemnity
as it may require against the costs, expenses and liabilities to be incurred
thereby, and 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; provided, that no holder of Debt Securities shall have any
right to prejudice the rights of any other holder of Debt Securities, obtain
priority or preference over any other such holder or enforce any right under
this Indenture except in the manner herein provided and for the equal, ratable
and common benefit of all holders of Debt Securities.

Notwithstanding any other provisions in this
Indenture, the right of any holder of any Debt Security to receive payment of
the principal of and premium, if any, and interest on such Debt Security when
due, or to institute suit for the enforcement of any such payment, shall not be
impaired or affected without the consent of such holder.  For the protection and enforcement of the
provisions of this Section, each and every Securityholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.

Section 5.05                                Proceedings
by Trustee.

In case of an Event of Default, 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 by suit in
equity or by action at law or by proceeding 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.

Section 5.06                                Remedies
Cumulative and Continuing.

Except as otherwise provided in Section 2.06, all
powers and remedies given by this Article V to the Trustee or to the
Securityholders 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 Debt Securities, 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 the Debt Securities,
and no delay or omission of the Trustee or of any holder of any of the Debt
Securities 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 5.04, every power and remedy
given by this Article V or by law to the Trustee or to the Securityholders may
be exercised from time to time, and as often as shall be deemed expedient, by
the Trustee or by the Securityholders.

 33
 

Section 5.07                                Direction
of Proceedings and Waiver of Defaults by Majority of Securityholders.

The holders of a majority in aggregate principal
amount of the Debt Securities affected at the time outstanding and, if the Debt
Securities are held by the Trust or a trustee of the Trust, the holders of a
majority in aggregate liquidation amount of the outstanding Capital Securities
of the Trust 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 with respect to such
Debt Securities; provided, however, that if the Debt Securities
are held by the Trust or a trustee of the Trust, such time, method and place or
such exercise, as the case may be, may not be so directed until the holders of
a majority in aggregate liquidation amount of the outstanding Capital
Securities of the Trust shall have directed such time, method and place or such
exercise, as the case may be; provided, further, that (subject to
the provisions of Section 6.01) the Trustee shall have the right to decline to
follow any such direction if the Trustee shall determine that the action so
directed would be unjustly prejudicial to the holders not taking part in such
direction or if the Trustee being advised by counsel determines that the action
or proceeding so directed may not lawfully be taken or if a Responsible Officer
of the Trustee shall determine that the action or proceedings so directed would
involve the Trustee in personal liability. 
Prior to any declaration of acceleration, or ipso  facto
acceleration, of the maturity of the Debt Securities, the holders of a majority
in aggregate principal amount of the Debt Securities at the time outstanding
may on behalf of the holders of all of the Debt Securities waive (or modify any
previously granted waiver of) any past Default or Event of Default and its
consequences, except a default (a) in the payment of principal of or premium,
if any, or interest on any of the Debt Securities, (b) in respect of covenants
or provisions hereof which cannot be modified or amended without the consent of
the holder of each Debt Security affected, or (c)  in respect of the covenants contained in
Section 3.09; provided, however, that if the Debt Securities 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 aggregate
liquidation amount of the outstanding Capital 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 Debt Security is
required, such waiver or modification to such waiver shall not be effective
until each holder of the outstanding Capital Securities of the Trust shall have
consented to such waiver or modification to such waiver.  Upon any such waiver or modification to such
waiver, the Default or Event of Default covered thereby shall be deemed to be
cured for all purposes of this Indenture and the Company, the Trustee and the
holders of the Debt Securities shall be restored to their former positions and
rights hereunder, respectively; but no such waiver or modification to such
waiver shall extend to any subsequent or other Default or Event of Default or
impair any right consequent thereon. 
Whenever any Default or Event of Default hereunder shall have been
waived as permitted by this Section, said Default or Event of Default shall for
all purposes of the Debt Securities and this Indenture be deemed to have been
cured and to be not continuing.

Section 5.08                                Notice
of Defaults.

The Trustee shall, within 90 days after a Responsible
Officer of the Trustee shall have actual knowledge or received written notice
of the occurrence of a default with respect to the Debt Securities, mail to all
Securityholders, as the names and addresses of such holders appear upon the
Debt Security Register, notice of all defaults with respect to the Debt
Securities

 34
 

known to the Trustee,
unless such defaults shall have been cured before the giving of such notice
(the term “default” for the purpose of this Section is hereby defined to be any
event specified in Section 5.01, not including periods of grace, if any,
provided for therein); provided, that, except in the case of
default in the payment of the principal of or premium, if any, or interest on
any of the Debt Securities, the Trustee shall be protected in withholding such
notice if and so long as a Responsible Officer of the Trustee in good faith
determines that the withholding of such notice is in the interests of the
Securityholders.

Section 5.09                                Undertaking
to Pay Costs.

All parties to this Indenture agree, and each holder
of any Debt Security 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 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Securityholder, or
group of Securityholders, holding in the aggregate more than 10% in principal
amount of the outstanding Debt Securities (or, if such Debt Securities are held
by the Trust or a trustee of the Trust, more than 10% in liquidation amount of
the outstanding Capital Securities), to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of or
premium, if any, or interest on any Debt Security against the Company on or
after the same shall have become due and payable or to any suit instituted in
accordance with Section 14.12.

ARTICLE
VI

CONCERNING THE TRUSTEE

Section 6.01                                Duties
and Responsibilities of Trustee.

With respect to the holders of Debt Securities issued
hereunder, the Trustee, prior to the occurrence of an Event of Default with
respect to the Debt Securities and after the curing or waiving of all Events of
Default which may have occurred, with respect to the Debt Securities,
undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture.  In case an
Event of Default with respect to the Debt Securities has occurred (which 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 person would exercise or use under the
circumstances in the conduct of such person’s own affairs.

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 or bad faith, except
that:

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

 35
 

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

(ii)                                  in
the absence of bad faith on the part of the Trustee, the Trustee may
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 which 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 on
their face to the requirements of this Indenture;

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

(c)                                  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 Securityholders pursuant to
Section 5.07, 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; and

(d)                                 the Trustee shall not
be charged with knowledge of any Default or Event of Default with respect to
the Debt Securities unless either (1) a Responsible Officer shall have actual
knowledge of such Default or Event of Default or (2) written notice of such
Default or Event of Default shall have been given to the Trustee by the Company
or any other obligor on the Debt Securities or by any holder of the Debt
Securities, except that the Trustee shall be deemed to have knowledge of any
Event of Default pursuant to Sections 5.01(a), 5.01(b) or 5.01(c) hereof (other
than an Event of Default resulting from the default in the payment of
Additional Amounts if the Trustee does not have actual knowledge or written
notice that such payment is due and payable) .

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.

Section 6.02        Reliance on Documents,
Opinions, etc.

Except as otherwise provided in Section 6.01:

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

 36
 

(b)                                 any request,
direction, order or demand of the Company mentioned herein shall be
sufficiently evidenced by an Officers’ Certificate (unless other evidence in
respect thereof be herein specifically prescribed); and any Board Resolution
may be evidenced to the Trustee by a copy thereof certified by the Secretary or
an Assistant Secretary of the Company;

(c)                                  the Trustee may consult
with counsel of its selection and any advice or Opinion of 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 accordance with such
advice or Opinion of Counsel;

(d)                                 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
Securityholders, pursuant to the provisions of this Indenture, unless such
Securityholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby;

(e)                                  the Trustee shall not
be liable for any action taken or omitted by it in good faith and reasonably
believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Indenture; nothing contained herein shall, however,
relieve the Trustee of the obligation, upon the occurrence of an Event of
Default with respect to the Debt Securities (which has not been cured or
waived) to exercise with respect to the Debt Securities 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 person would exercise or use under the
circumstances in the conduct of such person’s own affairs;

(f)                                    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, debenture, coupon or other paper or
document, unless requested in writing to do so by the holders of a majority in
aggregate principal amount of the outstanding Debt Securities affected thereby;
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
expense or liability as a condition to so proceeding; and

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

Section 6.03                                No
Responsibility for Recitals, etc.

The recitals contained herein and in the Debt
Securities (except in the certificate of authentication of the Trustee or the
Authenticating Agent) shall be taken as the statements of the Company, and the
Trustee and the Authenticating Agent assume no responsibility for the
correctness of the same.  The Trustee and
the Authenticating Agent make no representations as to the validity or
sufficiency of this Indenture or of the Debt Securities.  The Trustee and the

 37
 

Authenticating Agent
shall not be accountable for the use or application by the Company of any Debt
Securities or the proceeds of any Debt Securities authenticated and delivered
by the Trustee or the Authenticating Agent in conformity with the provisions of
this Indenture.

Section 6.04                                Trustee,
Authenticating Agent, Paying Agents, Transfer Agents or Registrar May Own Debt
Securities.

The Trustee, any Authenticating Agent, any Paying
Agent, any transfer agent or any Debt Security registrar, in its individual or
any other capacity, may become the owner or pledgee of Debt Securities with the
same rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, transfer agent or Debt Security registrar.

Section 6.05                                Moneys
to be Held in Trust.

Subject to the provisions of Section 12.04, all moneys
received by the Trustee or any Paying Agent shall, until used or applied as
herein provided, be held in trust for the purpose for which they were received,
but need not be segregated from other funds except to the extent required by
law.  The Trustee and any Paying Agent
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed in writing with the Company.  So long as no Event of Default shall have
occurred and be continuing, all interest allowed on any such moneys, if any,
shall be paid from time to time to the Company upon the written order of the
Company, signed by the Chairman of the Board of Directors, the President, the
Chief Operating Officer, a Vice President, the Treasurer or an Assistant
Treasurer of the Company.

Section 6.06                                Compensation
and Expenses of Trustee.

The Company covenants and agrees to pay to the Trustee
from time to time, and the Trustee shall be entitled to, such compensation as
shall be agreed to in writing between the Company and the Trustee (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust), and the Company will pay or reimburse the Trustee
upon its written request for all documented 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
reasonable expenses and disbursements of its counsel and of all Persons not
regularly in its employ) except any such expense, disbursement or advance that
arises from its negligence, willful misconduct or bad faith.  The Company also covenants to indemnify each
of the Trustee (including in its individual capacity) and any predecessor
Trustee (and its officers, agents, directors and employees) for, and to hold it
harmless against, any and all loss, damage, claim, liability or expense
including taxes (other than taxes based on the income of the Trustee), except to
the extent such loss, damage, claim, liability or expense results from the
negligence, willful misconduct or bad faith of such indemnitee, 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 or liability in
the premises.  The obligations of the
Company under this Section to compensate and indemnify the Trustee and to pay
or reimburse the Trustee for documented expenses, disbursements and advances
shall constitute additional indebtedness hereunder.  Such additional indebtedness shall be secured
by a lien prior to that of the Debt Securities upon all property and funds held
or collected by the

 38
 

Trustee as such, except
funds held in trust for the benefit of the holders of particular Debt
Securities.

Without prejudice to any other rights available to the
Trustee under applicable law, when the Trustee incurs expenses or renders
services in connection with an Event of Default specified in clause (e), (f),
(g), (h) or (i) of Section 5.01, the expenses (including the reasonable charges
and expenses of its counsel) and the compensation for the services are intended
to constitute expenses of administration under any applicable federal or state
bankruptcy, insolvency or other similar law.

The provisions of this Section shall survive the
resignation or removal of the Trustee and the defeasance or other termination
of this Indenture.

Notwithstanding anything in this Indenture or any Debt
Security to the contrary, the Trustee shall have no obligation whatsoever to
advance funds to pay any principal of or interest on or other amounts with
respect to the Debt Securities or otherwise advance funds to or on behalf of
the Company.

Section 6.07                                Officers’
Certificate as Evidence.

Except as otherwise provided in Sections 6.01 and
6.02, 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 omitting any action hereunder, such matter
(unless other evidence in respect thereof be herein specifically prescribed)
may, in the absence of negligence, willful misconduct or bad faith on the part
of the Trustee, be deemed to be conclusively proved and established by an Officers’
Certificate delivered to the Trustee, and such certificate, in the absence of
negligence, willful misconduct or bad faith on the part of the Trustee, shall
be full warrant to the Trustee for any action taken or omitted by it under the
provisions of this Indenture upon the faith thereof.

Section 6.08                                Eligibility
of Trustee.

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

The Company may not, nor may any Person directly or
indirectly controlling, controlled by, or under common control with the
Company, serve as Trustee, notwithstanding that such corporation or national
association shall be otherwise eligible and qualified under this Article.

 39
 

In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section 6.09.

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

Section 6.09                                Resignation
or Removal of Trustee.

(a)                                  The Trustee, or any
trustee or trustees hereafter appointed, may at any time resign by giving
written notice of such resignation to the Company and by mailing notice
thereof, at the Company’s expense, to the holders of the Debt Securities at
their addresses as they shall appear on the Debt Security Register.  Upon receiving such notice of resignation,
the Company shall promptly appoint a successor trustee or trustees by written
instrument, in duplicate, executed by order of its 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 to the affected
Securityholders, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee, or any Securityholder
who has been a bona fide holder of a Debt Security or Debt Securities for at
least six months may, subject to the provisions of Section 5.09, on behalf of
himself or herself 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 and prescribe, appoint a successor Trustee.

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

(i)                                     the
Trustee shall fail to comply with the provisions of the last paragraph of
Section 6.08 after written request therefor by the Company or by any Securityholder
who has been a bona fide holder of a Debt Security or Debt Securities for at
least six months;

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

(iii)                               the
Trustee shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
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 Company may remove the
Trustee 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 5.09, if no successor Trustee shall
have been so appointed and have accepted appointment within 30 days of the
occurrence of any of (i), (ii) or (iii) above, any Securityholder who has been
a bona fide holder of a Debt Security or Debt Securities for at

 40
 

least six months may, on behalf of himself or herself
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)                                  Upon prior written
notice to the Company and the Trustee, the holders of a majority in aggregate
principal amount of the Debt Securities at the time outstanding may at any time
remove the Trustee and nominate a successor Trustee, which shall be deemed
appointed as successor Trustee unless within ten Business Days after such
nomination the Company objects thereto, in which case or in the case of a
failure by such holders to nominate a successor Trustee, the Trustee so removed
or any Securityholder, upon the terms and conditions and otherwise as in
subsection (a) of this Section, may petition any court of competent
jurisdiction for an appointment of a successor.

(d)                                 Any resignation or
removal of the Trustee and appointment of a successor Trustee pursuant to any
of the provisions of this Section shall become effective upon acceptance of
appointment by the successor Trustee as provided in Section 6.10.

Section 6.10                                Acceptance
by Successor Trustee.

Any successor Trustee appointed as provided in Section
6.09 shall execute, acknowledge and deliver to the Company and to its
predecessor Trustee an indenture supplemental hereto which shall contain such
provisions as shall be deemed necessary or desirable to confirm that all of the
rights, powers, trusts and duties of the retiring Trustee shall be vested in
the successor Trustee, 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,
duties and obligations with respect to the Debt Securities of its predecessor
hereunder, with like effect as if originally named as Trustee herein; but,
nevertheless, on the written request of the Company or of the successor
Trustee, the Trustee ceasing to act shall, upon payment of the amounts then due
it pursuant to the provisions of Section 6.06, execute and deliver an
instrument transferring to such successor Trustee all the rights and powers of
the Trustee so ceasing to act and shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring Trustee
hereunder.  Upon request of any such
successor Trustee, the Company shall execute any and all instruments in writing
for more fully and certainly vesting in and confirming to such successor
Trustee all such rights and powers.  Any
Trustee ceasing to act shall, nevertheless, retain a lien upon all property or
funds held or collected by such Trustee to secure any amounts then due it
pursuant to the provisions of Section 6.06.

No successor Trustee shall accept appointment as
provided in this Section unless at the time of such acceptance such successor
Trustee shall be eligible and qualified under the provisions of Section 6.08.

In no event shall a retiring Trustee be liable for the
acts or omissions of any successor Trustee hereunder.

 41
 

Upon acceptance of appointment by a successor Trustee
as provided in this Section, the Company shall mail notice of the succession of
such Trustee hereunder to the holders of Debt Securities at their addresses as
they shall appear on the Debt Security Register.  If the Company fails to mail such notice
within ten Business Days after the acceptance of appointment by the successor
Trustee, the successor Trustee shall cause such notice to be mailed at the
expense of the Company.

Section 6.11                                Succession
by Merger, etc.

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 of the
corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder without the execution or filing of any paper or any further act on
the part of any of the parties hereto, provided, that such corporation
shall be otherwise eligible and qualified under this Article.

In case at the time such successor to the Trustee
shall succeed to the trusts created by this Indenture any of the Debt
Securities shall have been authenticated but not delivered, any such successor
to the Trustee may adopt the certificate of authentication of any predecessor
Trustee, and deliver such Debt Securities so authenticated; and in case at that
time any of the Debt Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Debt Securities either in the
name of any predecessor hereunder or in the name of the successor Trustee; and
in all such cases such certificates shall have the full force which it is
anywhere in the Debt Securities or in this Indenture provided that the
certificate of the Trustee shall have; provided, however, that
the right to adopt the certificate of authentication of any predecessor Trustee
or authenticate Debt Securities in the name of any predecessor Trustee shall
apply only to its successor or successors by merger, conversion or
consolidation.

Section 6.12                                Authenticating
Agents.

There may be one or more Authenticating Agents
appointed by the Trustee upon the request of the Company with power to act on
its behalf and subject to its direction in the authentication and delivery of
Debt Securities issued upon exchange or registration of transfer thereof as fully
to all intents and purposes as though any such Authenticating Agent had been
expressly authorized to authenticate and deliver Debt Securities; provided,
however, that the Trustee shall have no liability to the Company for any
acts or omissions of the Authenticating Agent with respect to the
authentication and delivery of Debt Securities. 
Any such Authenticating Agent shall at all times be a corporation
organized and doing business under the laws of the United States or of any
state thereof or of the District of Columbia authorized under such laws to act
as Authenticating Agent, having a combined capital and surplus of at least
$50,000,000 and being subject to supervision or examination by federal, state
or District of Columbia authority.  If
such corporation publishes reports of condition at least annually pursuant to
law or the requirements of such authority, then for the purposes of this
Section 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.  If at any time
an Authenticating

 42

Agent shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect herein specified in this Section.

Any corporation into which any Authenticating Agent
may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, consolidation or conversion to which any
Authenticating Agent shall be a party, or any corporation succeeding to all or
substantially all of the corporate trust business of any Authenticating Agent,
shall be the successor of such Authenticating Agent hereunder, if such
successor corporation is otherwise eligible under this Section without the
execution or filing of any paper or any further act on the part of the parties
hereto or such Authenticating Agent.

Any Authenticating Agent may at any time resign by
giving written notice of resignation to the Trustee and to the Company.  The Trustee may at any time terminate the
agency of any Authenticating Agent with respect to the Debt Securities by
giving written notice of termination to such Authenticating Agent and to the
Company.  Upon receiving such a notice of
resignation or upon such a termination, or in case at any time any Authenticating
Agent shall cease to be eligible under this Section, the Trustee may, and upon
the request of the Company shall, promptly appoint a successor Authenticating
Agent eligible under this Section, shall give written notice of such
appointment to the Company and shall mail notice of such appointment to all
holders of Debt Securities as the names and addresses of such holders appear on
the Debt Security Register.  Any
successor Authenticating Agent, upon acceptance of its appointment hereunder,
shall become vested with all rights, powers, duties and responsibilities of its
predecessor hereunder, with like effect as if originally named as
Authenticating Agent herein.

The Company agrees to pay to any Authenticating Agent
from time to time reasonable compensation for its services.  Any Authenticating Agent shall have no
responsibility or liability for any action taken by it as such in accordance
with the directions of the Trustee.

ARTICLE VII

CONCERNING THE SECURITYHOLDERS

Section 7.01                                Action
by Securityholders.

Whenever in this Indenture it is provided that the
holders of a specified percentage in aggregate principal amount of the Debt
Securities or aggregate liquidation amount of the Capital Securities 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 specified percentage
have joined therein may be evidenced (a) by any instrument or any number of
instruments of similar tenor executed by such Securityholders or holders of
Capital Securities, as the case may be, in person or by agent or proxy
appointed in writing, or (b) by the record of such holders of Debt Securities
voting in favor thereof at any meeting of such Securityholders duly called and
held in accordance with the provisions of Article VIII or of such holders of
Capital Securities duly called and held in accordance with the provisions of
the Declaration, or (c) by a combination of such instrument or instruments and
any such record of such a meeting of such Securityholders or holders of Capital
Securities, as the case may be, or (d) by any other method the Trustee deems
satisfactory.

 43
 

If the Company shall solicit from the Securityholders
any request, demand, authorization, direction, notice, consent, waiver or other
action or revocation of the same, the Company may, at its option, as evidenced
by an Officers’ Certificate, fix in advance a record date for such Debt
Securities for the determination of Securityholders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other
action or revocation of the same, but the Company 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 or revocation of the same may be given before or after the record
date, but only the Securityholders of record at the close of business on the
record date shall be deemed to be Securityholders for the purposes of
determining whether Securityholders of the requisite proportion of outstanding
Debt Securities have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other action or revocation
of the same, and for that purpose the outstanding Debt Securities shall be
computed as of the record date; provided, however, that no such
authorization, agreement or consent by such Securityholders 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 7.02                                Proof
of Execution by Securityholders.

Subject to the provisions of Sections 6.01, 6.02 and
8.05, proof of the execution of any instrument by a Securityholder or such
Securityholder’s agent or proxy shall be sufficient if made in accordance with
such reasonable rules and regulations as may be prescribed by the Trustee or in
such manner as shall be satisfactory to the Trustee.  The ownership of Debt Securities shall be
proved by the Debt Security Register or by a certificate of the Debt Security
registrar.  The Trustee may require such
additional proof of any matter referred to in this Section as it shall deem
necessary.

The record of any Securityholders’ meeting shall be
proved in the manner provided in Section 8.06.

Section 7.03                                Who
Are Deemed Absolute Owners.

Prior to due presentment for registration of transfer
of any Debt Security, the Company, the Trustee, any Authenticating Agent, any
Paying Agent, any transfer agent and any Debt Security registrar may deem the
Person in whose name such Debt Security shall be registered upon the Debt
Security Register to be, and may treat such Person as, the absolute owner of
such Debt Security (whether or not such Debt Security shall be overdue) for the
purpose of receiving payment of or on account of the principal of and premium,
if any, and interest on such Debt Security and for all other purposes; and none
of the Company, the Trustee, any Authenticating Agent, any Paying Agent, any
transfer agent or any Debt Security registrar shall be affected by any notice
to the contrary.  All such payments so
made to any holder for the time being or upon such holder’s order shall be
valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for moneys payable upon any such Debt Security.

 44
 

Section 7.04                                Debt
Securities Owned by Company Deemed Not Outstanding.

In determining whether the holders of the requisite
aggregate principal amount of Debt Securities have concurred in any direction,
consent or waiver under this Indenture, Debt Securities which are owned by the
Company or any other obligor on the Debt Securities or by any Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with the Company (other than the Trust) or any other obligor on the
Debt Securities shall be disregarded and deemed not to be outstanding for the
purpose of any such determination, provided, that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, consent or waiver, only Debt Securities which a Responsible Officer
of the Trustee actually knows are so owned shall be so disregarded.  Debt Securities so owned which have been
pledged in good faith may be regarded as outstanding for the purposes of this
Section if the pledgee shall establish to the satisfaction of the Trustee the
pledgee’s right to vote such Debt Securities and that the pledgee is not the
Company or any such other obligor or Person directly or indirectly controlling
or controlled by or under direct or indirect common control with the Company or
any such other obligor.  In the 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 7.05                                Revocation
of Consents; Future Holders Bound.

At any time prior to (but not after) the evidencing to
the Trustee, as provided in Section 7.01, of the taking of any action by the
holders of the percentage in aggregate principal amount of the Debt Securities
specified in this Indenture in connection with such action, any holder (in
cases where no record date has been set pursuant to Section 7.01) or any holder
as of an applicable record date (in cases where a record date has been set
pursuant to Section 7.01) of a Debt Security (or any Debt Security issued in
whole or in part in exchange or substitution therefor) the serial number of
which is shown by the evidence to be included in the Debt Securities the
holders of which have consented to such action may, by filing written notice
with the Trustee at the Principal Office of the Trustee and upon proof of
holding as provided in Section 7.02, revoke such action so far as concerns such
Debt Security (or so far as concerns the principal amount represented by any
exchanged or substituted Debt Security). 
Except as aforesaid any such action taken by the holder of any Debt
Security shall be conclusive and binding upon such holder and upon all future
holders and owners of such Debt Security, and of any Debt Security issued in
exchange or substitution therefor or on registration of transfer thereof,
irrespective of whether or not any notation in regard thereto is made upon such
Debt Security or any Debt Security issued in exchange or substitution therefor.

ARTICLE VIII

SECURITYHOLDERS’ MEETINGS

Section 8.01                                Purposes
of Meetings.

A meeting of Securityholders may be called at any time
and from time to time pursuant to the provisions of this Article VIII for any
of the following purposes:

(a)                                  to
give any notice to the Company or to the Trustee, or to give any directions to
the Trustee, or to consent to the waiving of any default hereunder and its

 45
 

consequences, or to take any other action authorized to be taken by
Securityholders pursuant to any of the provisions of Article V;

(b)                                 to
remove the Trustee and nominate a successor trustee pursuant to the provisions
of Article VI;

(c)                                  to
consent to the execution of an indenture or indentures supplemental hereto
pursuant to the provisions of Section 9.02; or

(d)                                 to
take any other action authorized to be taken by or on behalf of the holders of
any specified aggregate principal amount of such Debt Securities under any
other provision of this Indenture or under applicable law.

Section 8.02                                Call
of Meetings by Trustee.

The Trustee may at any time call a meeting of
Securityholders to take any action specified in Section 8.01, to be held at
such time and at such place in The City of New York, the Borough of Manhattan,
or Wilmington, Delaware, as the Trustee shall determine.  Notice of every meeting of the
Securityholders, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be mailed
to holders of Debt Securities affected at their addresses as they shall appear
on the Debt Securities Register.  Such
notice shall be mailed not less than 20 nor more than 180 days prior to the
date fixed for the meeting.

Section 8.03                                Call
of Meetings by Company or Securityholders.

In case at any time the Company pursuant to a Board
Resolution, or the holders of at least 10% in aggregate principal amount of the
Debt Securities, as the case may be, then outstanding, shall have requested the
Trustee to call a meeting of Securityholders, by written request setting forth
in reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have mailed the notice of such meeting within 20 days after
receipt of such request, then the Company or such Securityholders may determine
the time and the place in Sacramento, California for such meeting and may call
such meeting to take any action authorized in Section 8.01, by mailing notice
thereof as provided in Section 8.02.

Section 8.04                                Qualifications
for Voting.

To be entitled to vote at any meeting of
Securityholders, a Person shall be (a) a holder of one or more Debt Securities
or (b) a Person appointed by an instrument in writing as proxy by a holder of
one or more Debt Securities.  The only
Persons who shall be entitled to be present or to speak at any meeting of
Securityholders shall be the Persons entitled to vote at such meeting and their
counsel and any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.

Section 8.05                                Regulations.

Notwithstanding any other provisions of this
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Securityholders, in

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regard to proof of the
holding of Debt Securities and of the appointment of proxies, and in regard to
the appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to vote,
and such other matters concerning the conduct of the meeting as it shall deem
appropriate.

The Trustee shall, by an instrument in writing,
appoint a temporary chairman of the meeting, unless the meeting shall have been
called by the Company or by Securityholders as provided in Section 8.03, in
which case the Company or the Securityholders calling the meeting, as the case
may be, shall in like manner appoint a temporary chairman. A permanent chairman
and a permanent secretary of the meeting shall be elected by majority vote at
the meeting.

Subject to the provisions of Section 7.04, at any
meeting each holder of Debt Securities with respect to which such meeting is
being held or proxy therefor shall be entitled to one vote for each $1,000
principal amount of Debt Securities held or represented by such holder; provided,
however, that no vote shall be cast or counted at any meeting in respect
of any Debt Security challenged as not outstanding and ruled by the chairman of
the meeting to be not outstanding.  The
chairman of the meeting shall have no right to vote other than by virtue of
Debt Securities held by such chairman or instruments in writing as aforesaid
duly designating such chairman as the Person to vote on behalf of other
Securityholders.  Any meeting of
Securityholders duly called pursuant to the provisions of Section 8.02 or 8.03
may be adjourned from time to time by a majority of those present, whether or
not constituting a quorum, and the meeting may be held as so adjourned without
further notice.

Section 8.06                                Voting.

The vote upon any resolution submitted to any meeting
of holders of Debt Securities with respect to which such meeting is being held
shall be by written ballots on which shall be subscribed the signatures of such
holders or of their representatives by proxy and the serial number or numbers
of the Debt Securities held or represented by them.  The permanent chairman of the meeting shall
appoint two inspectors of votes who shall count all votes cast at the meeting
for or against any resolution and who shall make and file with the secretary of
the meeting their verified written reports in triplicate of all votes cast at
the meeting. A record in duplicate of the proceedings of each meeting of
Securityholders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of
votes on any vote by ballot taken thereat and affidavits by one or more Persons
having knowledge of the facts setting forth a copy of the notice of the meeting
and showing that said notice was mailed as provided in Section 8.02.  The record shall show the serial numbers of
the Debt Securities voting in favor of or against any resolution. The record
shall be signed and verified by the affidavits of the permanent chairman and
secretary of the meeting and one of the duplicates shall be delivered to the
Company and the other to the Trustee to be preserved by the Trustee, the latter
to have attached thereto the ballots voted at the meeting.

Any record so signed and verified shall be conclusive
evidence of the matters therein stated.

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Section 8.07                                Quorum;
Actions.

The Persons entitled to vote a majority in aggregate
principal amount of the Debt Securities then outstanding shall constitute a
quorum for a meeting of Securityholders; provided, however, that
if any action is to be taken at such meeting with respect to a consent, waiver,
request, demand, notice, authorization, direction or other action which may be
given by the holders of not less than a specified percentage in aggregate
principal amount of the Debt Securities then outstanding, the Persons holding
or representing such specified percentage in aggregate principal amount of the
Debt Securities then outstanding will constitute a quorum.  In the absence of a quorum within 30 minutes
of the time appointed for any such meeting, the meeting shall, if convened at
the request of Securityholders, be dissolved. 
In any other case, the meeting may be adjourned for a period of not less
than 10 days as determined by the permanent chairman of the meeting prior to
the adjournment of such meeting.  In the
absence of a quorum at any such adjourned meeting, such adjourned meeting may
be further adjourned for a period of not less than 10 days as determined by the
permanent chairman of the meeting prior to the adjournment of such adjourned
meeting.  Notice of the reconvening of
any adjourned meeting shall be given as provided in Section 8.02, except that
such notice need be given only once not less than five days prior to the date
on which the meeting is scheduled to be reconvened.  Notice of the reconvening of an adjourned
meeting shall state expressly the percentage, as provided above, of the
aggregate principal amount of the Debt Securities then outstanding which shall
constitute a quorum.

Except as limited by the proviso in the first paragraph
of Section 9.02, any resolution presented to a meeting or adjourned meeting
duly reconvened at which a quorum is present as aforesaid may be adopted by the
affirmative vote of the holders of a majority in aggregate principal amount of
the Debt Securities then outstanding; provided, however, that,
except as limited by the proviso in the first paragraph of Section 9.02, any
resolution with respect to any consent, waiver, request, demand, notice,
authorization, direction or other action that this Indenture expressly provides
may be given by the holders of not less than a specified percentage in
outstanding principal amount of the Debt Securities may be adopted at a meeting
or an adjourned meeting duly reconvened and at which a quorum is present as
aforesaid only by the affirmative vote of the holders of not less than such
specified percentage in aggregate principal amount of the Debt Securities then
outstanding.

Any resolution passed or decision taken at any meeting
of holders of Debt Securities duly held in accordance with this Section shall
be binding on all the Securityholders, whether or not present or represented at
the meeting.

ARTICLE IX

SUPPLEMENTAL INDENTURES

Section 9.01                                Supplemental
Indentures without Consent of Securityholders.

The Company, when authorized by a Board Resolution,
and the Trustee may from time to time and at any time enter into an indenture
or indentures supplemental hereto, without the consent of the Securityholders,
for one or more of the following purposes:

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(a)                                  to
evidence the succession of another corporation to the Company, or successive
successions, and the assumption by the successor corporation of the covenants,
agreements and obligations of the Company, pursuant to Article XI hereof;

(b)                                 to
add to the covenants of the Company such further covenants, restrictions or
conditions for the protection of the holders of Debt Securities as the Board of
Directors shall consider to be for the protection of the holders of such Debt
Securities, and to make the occurrence, or the occurrence and continuance, of a
Default in any of such additional covenants, restrictions or conditions a
Default or an Event of Default permitting the enforcement of all or any of the
several remedies provided in this Indenture as herein set forth; provided,
however, that in respect of any such additional covenant, restriction or
condition such supplemental indenture may provide for a particular period of
grace after Default (which period may be shorter or longer than that allowed in
the case of other Defaults) or may provide for an immediate enforcement upon
such Default or may limit the remedies available to the Trustee upon such
default;

(c)                                  to
cure any ambiguity or to correct or supplement any provision contained herein
or in any supplemental indenture which may be defective or inconsistent with
any other provision contained herein or in any supplemental indenture, or to
make such other provisions in regard to matters or questions arising under this
Indenture, provided, that any such action shall not adversely affect the
interests of the holders of the Debt Securities then outstanding;

(d)                                 to
add to, delete from, or revise the terms of Debt Securities, including, without
limitation, any terms relating to the issuance, exchange, registration or
transfer of Debt Securities, including to provide for transfer procedures and
restrictions substantially similar to those applicable to the Capital
Securities, as required by Section 2.05 (for purposes of assuring that no
registration of Debt Securities is required under the Securities Act), provided,
that any such action shall not adversely affect the interests of the holders of
the Debt Securities then outstanding (it being understood, for purposes of this
proviso, that transfer restrictions on Debt Securities substantially similar to
those applicable to Capital Securities shall not be deemed to adversely affect
the holders of the Debt Securities);

(e)                                  to
evidence and provide for the acceptance of appointment hereunder by a successor
Trustee with respect to the Debt Securities and to add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, pursuant
to the requirements of Section 6.10;

(f)                                    to
make any change (other than as elsewhere provided in this Section) that does
not adversely affect the rights of any Securityholder in any material respect;
or

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

The Trustee is hereby authorized to join with the
Company in the execution of any such supplemental indenture, to make any
further appropriate agreements and stipulations

 49
 

which may be therein
contained and to accept the conveyance, transfer and assignment of any property
thereunder, but the Trustee shall not be obligated to, but may in its
discretion, enter into any such supplemental indenture which affects the
Trustee’s own rights, duties or immunities under this Indenture or otherwise.

Any supplemental indenture authorized by the
provisions of this Section may be executed by the Company and the Trustee
without the consent of the holders of any of the Debt Securities at the time
outstanding, notwithstanding any of the provisions of Section 9.02.

Section 9.02                                Supplemental
Indentures with Consent of Securityholders.

With the consent (evidenced as provided in Section
7.01) of the holders of a majority in aggregate principal amount of the Debt
Securities at the time outstanding affected by such supplemental indenture, the
Company, when authorized by a Board Resolution, 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, then
in effect, applicable to indentures qualified thereunder) 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 the rights of the holders of the Debt Securities; provided,
however, that no such supplemental indenture shall, without the consent
of the holders of each Debt Security then outstanding and affected thereby, (i)
change the Maturity Date of any Debt Security, or reduce the principal amount
thereof or any premium thereon, or reduce the rate (or manner of calculation of
the rate) or extend the time of payment of interest thereon, or reduce (other
than as a result of the maturity or earlier redemption of any such Debt
Security in accordance with the terms of this Indenture and such Debt Security)
or increase the aggregate principal amount of Debt Securities then outstanding,
or change any of the redemption provisions, or make the principal thereof or
any interest or premium thereon payable in any coin or currency other than
United States Dollars, or impair or affect the right of any Securityholder to
institute suit for payment thereof, or (ii) reduce the aforesaid percentage of
Debt Securities the holders of which are required to consent to any such
supplemental indenture; and provided, further, that if the Debt
Securities are held by the Trust or the trustee of the Trust, such supplemental
indenture shall not be effective until the holders of a majority in aggregate
liquidation amount of the outstanding Capital Securities shall have consented
to such supplemental indenture; provided, further, that if the
consent of the Securityholder of each outstanding Debt Security is required,
such supplemental indenture shall not be effective until each holder of the
outstanding Capital Securities shall have consented to such supplemental
indenture.

Upon the request of the Company accompanied by a Board
Resolution authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of Securityholders
(and holders of Capital Securities, if required) as aforesaid, the Trustee
shall join with the Company in the execution of such supplemental indenture
unless such supplemental indenture 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.

 50
 

Promptly after the execution by the Company and the
Trustee of any supplemental indenture pursuant to the provisions of this Section,
the Trustee shall transmit by mail, first class postage prepaid, a notice,
prepared by the Company, setting forth in general terms the substance of such
supplemental indenture, to the Securityholders as their names and addresses
appear upon the Debt Security 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.

It shall not be necessary for the consent of the
Securityholders under this Section to approve the particular form of any
proposed supplemental indenture, but it shall be sufficient if such consent
shall approve the substance thereof.

Section 9.03                                Effect
of Supplemental Indentures.

Upon the execution of any supplemental indenture
pursuant to the provisions of this Article IX, 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 Company and the holders of Debt Securities 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 9.04                                Notation
on Debt Securities.

Debt Securities authenticated and delivered after the
execution of any supplemental indenture pursuant to the provisions of this
Article IX may bear a notation as to any matter provided for in such
supplemental indenture.  If the Company
or the Trustee shall so determine, new Debt Securities so modified as to
conform, in the opinion of the Board of Directors of the Company, to any
modification of this Indenture contained in any such supplemental indenture may
be prepared and executed by the Company, authenticated by the Trustee or the
Authenticating Agent and delivered in exchange for the Debt Securities then outstanding.

Section 9.05                                Evidence
of Compliance of Supplemental Indenture to be Furnished to Trustee.

The Trustee, subject to the provisions of Sections
6.01 and 6.02, shall, in addition to the documents required by Section 14.06,
receive an Officers’ Certificate as conclusive evidence that any supplemental
indenture executed pursuant hereto complies with the requirements of this
Article IX.  The Trustee shall also
receive an Opinion of Counsel as conclusive evidence that any supplemental
indenture executed pursuant to this Article IX is authorized or permitted by,
and conforms to, the terms of this Article IX and that it is proper for the
Trustee under the provisions of this Article IX to join in the execution
thereof.

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ARTICLE X

REDEMPTION OF SECURITIES

Section 10.01                          Optional
Redemption.

The Company shall have the right, subject to the
receipt by the Company of the prior approval from the Federal Reserve, if then
required under applicable capital guidelines or policies of the Federal
Reserve, to redeem the Debt Securities, in whole or (provided that all accrued
and unpaid interest has been paid on all Debt Securities for all Interest
Periods terminating on or prior to such date) from time to time in part, on any
Interest Payment Date on or after September 1, 2012 (each, an “Optional
Redemption Date”), at the Optional Redemption Price.

Section 10.02                          Special
Event Redemption.

If a Special Event shall occur and be continuing, the
Company shall have the right, subject to the receipt by the Company of prior
approval from the Federal Reserve, if then required under applicable capital
guidelines or policies of the Federal Reserve, to redeem the Debt Securities,
in whole but not in part, at any time within 90 days following the occurrence
of such Special Event (the “Special Redemption Date”), at the Special
Redemption Price.

Section 10.03                          Notice
of Redemption; Selection of Debt Securities.

In case the Company shall desire to exercise the right
to redeem all, or, as the case may be, any part of the Debt Securities, it shall
fix a date for redemption and shall mail, or cause the Trustee to mail (at the
expense of the Company), a notice of such redemption at least 30 and not more
than 60 days prior to the date fixed for redemption to the holders of Debt
Securities so to be redeemed as a whole or in part at their last addresses as
the same appear on the Debt Security Register. 
Such mailing shall be by first class mail.  The notice if mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the holder receives such notice.  In any
case, failure to give such notice by mail or any defect in the notice to the
holder of any Debt Security designated for redemption as a whole or in part
shall not affect the validity of the proceedings for the redemption of any
other Debt Security.

Each such notice of redemption shall specify the CUSIP
number, if any, of the Debt Securities to be redeemed, the date fixed for
redemption, the price (or manner of calculation of the price) at which Debt
Securities are to be redeemed, the place or places of payment, that payment
will be made upon presentation and surrender of such Debt Securities, that
interest accrued to the date fixed for redemption will be paid as specified in
said notice, and that on and after said date interest thereon or on the
portions thereof to be redeemed will cease to accrue. If less than all the Debt
Securities are to be redeemed, the notice of redemption shall specify the
numbers of the Debt Securities to be redeemed. 
In case the Debt Securities are to be redeemed in part only, the notice
of redemption shall state the portion of the principal amount thereof to be
redeemed and shall state that on and after the date fixed for redemption, upon
surrender of such Debt Security, a new Debt Security or Debt Securities in
principal amount equal to the unredeemed portion thereof will be issued.

 52
 

Prior to 10:00 a.m., New York City time, on the
Optional Redemption Date or the Special Redemption Date specified in the notice
of redemption given as provided in this Section, the Company will deposit with
the Trustee or with one or more Paying Agents an amount of money sufficient to
redeem on such date all the Debt Securities so called for redemption at the
applicable price therefor, together with unpaid interest accrued to such date.

The Company will give the Trustee notice not less than
45 nor more than 75 days prior to the date fixed for redemption as to the price
at which the Debt Securities are to be redeemed and the aggregate principal amount
of Debt Securities to be redeemed and the Trustee shall select, in such manner
as in its sole discretion it shall deem appropriate and fair, the Debt
Securities or portions thereof (in integral multiples of $1,000) to be
redeemed.

Section 10.04                          Payment
of Debt Securities Called for Redemption.

If notice of redemption has been given as provided in
Section 10.03, the Debt Securities or portions of Debt Securities with respect
to which such notice has been given shall become due and payable on the related
Optional Redemption Date or Special Redemption Date (as the case may be) and at
the place or places stated in such notice at the applicable price therefor,
together with unpaid interest accrued thereon to said Optional Redemption Date
or the Special Redemption Date (as the case may be), and on and after said
Optional Redemption Date or the Special Redemption Date (as the case may be)
(unless the Company shall default in the payment of such Debt Securities at the
redemption price, together with unpaid interest accrued thereon to said date)
interest on the Debt Securities or portions of Debt Securities so called for
redemption shall cease to accrue.  On
presentation and surrender of such Debt Securities at a place of payment
specified in said notice, such Debt Securities or the specified portions
thereof shall be paid and redeemed by the Company at the applicable price
therefor, together with unpaid interest, if any, accrued thereon to said
Optional Redemption Date or the Special Redemption Date (as the case may be); provided,
however, that interest payable on any Interest Payment Date on or prior
to said Optional Redemption Date or the Special Redemption Date will be paid to
the holders on the relevant regular record date.

Upon presentation of any Debt Security redeemed in
part only, the Company shall execute and the Trustee shall authenticate and
make available for delivery to the holder thereof, at the expense of the
Company, a new Debt Security or Debt Securities of authorized denominations in
principal amount equal to the unredeemed portion of the Debt Security so
presented.

ARTICLE XI

CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

Section 11.01                          Company
May Consolidate, etc., on Certain Terms.

Nothing contained in this Indenture or in the Debt
Securities shall prevent any consolidation or merger of the Company with or
into any other corporation or corporations (whether or not affiliated with the
Company) or successive consolidations or mergers in which the Company or its
successor or successors shall be a party or parties, or shall prevent any sale,
conveyance, transfer or other disposition of all or substantially all of the
property or capital stock

 53
 

of the Company or its
successor or successors to any other corporation (whether or not affiliated
with the Company or its successor or successors) authorized to acquire and
operate the same; provided, however, that the Company hereby
covenants and agrees that (i) upon any such consolidation, merger (where
the Company is not the surviving corporation), sale, conveyance, transfer or
other disposition, the successor entity shall be a corporation organized and
existing under the laws of the United States or any state thereof or the
District of Columbia (unless such corporation has (1) agreed to make all
payments due in respect of the Debt Securities or, if outstanding, the Trust
Securities and the Capital Securities Guarantee without withholding or
deduction for, or on account of, any taxes, duties, assessments or other
governmental charges under the laws or regulations of the jurisdiction of
organization or residence (for tax purposes) of such corporation or any
political subdivision or taxing authority thereof or therein unless required by
applicable law, in which case such corporation shall have agreed to pay such
additional amounts as shall be required so that the net amounts received and
retained by the holders of such Debt Securities or Trust Securities, as the
case may be, after payment of all taxes (including withholding taxes), duties,
assessments or other governmental charges, will be equal to the amounts that
such holders would have received and retained had no such taxes (including
withholding taxes), duties, assessments or other governmental charges been
imposed, (2) irrevocably and unconditionally consented and submitted to the
jurisdiction of any United States federal court or New York state court, in
each case located in the Borough of Manhattan, The City of New York, in respect
of any action, suit or proceeding against it arising out of or in connection
with this Indenture, the Debt Securities, the Capital Securities Guarantee or
the Declaration and irrevocably and unconditionally waived, to the fullest
extent permitted by law, any objection to the laying of venue in any such court
or that any such action, suit or proceeding has been brought in an inconvenient
forum and (3) irrevocably appointed an agent in The City of New York for
service of process in any action, suit or proceeding referred to in clause (2)
above) and such corporation expressly assumes all of the obligations of the
Company under the Debt Securities, this Indenture, the Capital Securities
Guarantee and the Declaration and (ii) after giving effect to any such
consolidation, merger, sale, conveyance, transfer or other disposition, no
Default or Event of Default shall have occurred and be continuing.

Section 11.02                          Successor
Entity to be Substituted.

In case of any such consolidation, merger, sale,
conveyance, transfer or other disposition contemplated in Section 11.01 and
upon the assumption by the successor corporation, by supplemental indenture,
executed and delivered to the Trustee and reasonably satisfactory in form to
the Trustee, of the due and punctual payment of the principal of and premium,
if any, and interest on all of the Debt Securities and the due and punctual
performance and observance of all of the covenants and conditions of this
Indenture to be performed or observed by the Company, such successor
corporation shall succeed to and be substituted for the Company, with the same
effect as if it had been named herein as the Company, and thereupon the
predecessor entity shall be relieved of any further liability or obligation
hereunder or upon the Debt Securities. 
Such successor corporation thereupon may cause to be signed, and may issue
either in its own name or in the name of the Company, any or all of the Debt
Securities issuable hereunder which theretofore shall not have been signed by
the Company and delivered to the Trustee or the Authenticating Agent; and, upon
the order of such successor corporation instead of the Company and subject to
all the terms, conditions and limitations in this Indenture prescribed, the
Trustee or the Authenticating Agent shall authenticate and deliver any Debt

 54
 

Securities which
previously shall have been signed and delivered by the officers of the Company
to the Trustee or the Authenticating Agent for authentication, and any Debt
Securities which such successor corporation thereafter shall cause to be signed
and delivered to the Trustee or the Authenticating Agent for that purpose.  All the Debt Securities so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Debt Securities theretofore or thereafter issued in accordance with the terms
of this Indenture as though all of such Debt Securities had been issued at the
date of the execution hereof.

Section 11.03                          Opinion
of Counsel to be Given to Trustee.

The Trustee, subject to the provisions of Sections
6.01 and 6.02, shall receive, in addition to the Opinion of Counsel required by
Section 9.05, an Opinion of Counsel as conclusive evidence that any
consolidation, merger, sale, conveyance, transfer or other disposition, and any
assumption, permitted or required by the terms of this Article XI complies with
the provisions of this Article XI.

ARTICLE XII

SATISFACTION AND DISCHARGE OF INDENTURE

Section 12.01                          Discharge
of Indenture.

When (a) the Company shall deliver to the Trustee for
cancellation all Debt Securities theretofore authenticated (other than any Debt
Securities which shall have been destroyed, lost or stolen and which shall have
been replaced or paid as provided in Section 2.06) and not theretofore
canceled, or (b) all the Debt Securities not theretofore canceled or 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 Company shall deposit with the
Trustee, in trust, funds, which shall be immediately due and payable,
sufficient to pay at maturity or upon redemption all of the Debt Securities
(other than any Debt Securities which shall have been destroyed, lost or stolen
and which shall have been replaced or paid as provided in Section 2.06) not
theretofore canceled or delivered to the Trustee for cancellation, including
principal and premium, if any, and interest due or to become due to the
Maturity Date, any Optional Redemption Date or the Special Redemption Date, as
the case may be, but excluding, however, the amount of any moneys for the
payment of principal of and premium, if any, or interest on the Debt Securities
(1) theretofore repaid to the Company in accordance with the provisions of
Section 12.04, or (2) paid to any state or to the District of Columbia pursuant
to its unclaimed property or similar laws, and if in the case of either clause
(a) or (b) above the Company shall also pay or cause to be paid all other sums
payable hereunder by the Company, then this Indenture shall cease to be of
further effect except for the provisions of Sections 2.05, 2.06, 3.01, 3.02,
3.04, 6.06, 6.09 and 12.04 hereof, which shall survive until such Debt
Securities shall mature or are redeemed, as the case may be, and are paid in
full.  Thereafter, Sections 6.06, 6.09
and 12.04 shall survive, and the Trustee, on demand of the Company accompanied
by an Officers’ Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with, and at the cost and
expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture, the Company,

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however, hereby agreeing
to reimburse the Trustee for any costs or expenses thereafter reasonably and
properly incurred by the Trustee in connection with this Indenture or the Debt
Securities.

Section 12.02                          Deposited
Moneys to be Held in Trust by Trustee.

Subject to the provisions of Section 12.04, all moneys
deposited with the Trustee pursuant to Section 12.01 shall be held in trust and
applied by it to the payment, either directly or through any Paying Agent
(including the Company if acting as its own Paying Agent), to the holders of
the particular Debt Securities for the payment of which such moneys have been
deposited with the Trustee, of all sums due and to become due thereon for
principal, premium, if any, and interest.

Section 12.03                          Paying
Agent to Repay Moneys Held.

Upon the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent of the Debt Securities (other than the
Trustee) shall, upon demand of the Company, be repaid to the Company or paid to
the Trustee, and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.

Section 12.04                          Return
of Unclaimed Moneys.

Any moneys deposited with or paid to the Trustee or
any Paying Agent for payment of the principal of and premium, if any, or
interest on Debt Securities and not applied but remaining unclaimed by the
holders of Debt Securities for two years after the date upon which the
principal of and premium, if any, or interest on such Debt Securities, as the
case may be, shall have become due and payable, shall be repaid to the Company
by the Trustee or such Paying Agent on written demand; and the holder of any of
the Debt Securities shall thereafter look only to the Company for any payment
which such holder may be entitled to collect and all liability of the Trustee
or such Paying Agent with respect to such moneys shall thereupon cease.

ARTICLE XIII

IMMUNITY OF INCORPORATORS, STOCKHOLDERS,

OFFICERS AND DIRECTORS

Section 13.01                          Indenture
and Debt Securities Solely Corporate Obligations.

No recourse for the payment of the principal of or
premium, if any, or interest on any Debt Security, or for any claim based
thereon or otherwise in respect thereof, and no recourse under or upon any
obligation, covenant or agreement of the Company in this Indenture or in any
supplemental indenture, or in any such Debt Security, or because of the
creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, officer, director, employee or agent, as such, past,
present or future, of the Company or of any predecessor or successor
corporation of the Company, either directly or through the Company or any
successor corporation of the Company, 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 all such liability is hereby
expressly waived and released as a condition of, and as a consideration for,
the execution of this Indenture and the issue of the Debt Securities.

 56

ARTICLE XIV

MISCELLANEOUS PROVISIONS

Section 14.01                          Successors.

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

Section 14.02                          Official
Acts by Successor Entity.

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 Company shall and may be done and performed with
like force and effect by the like board, committee, officer or other authorized
Person of any entity that shall at the time be the lawful successor of the
Company.

Section 14.03                          Surrender
of Company Powers.

The Company, by instrument in writing executed by
authority of 2/3 (two thirds) of its Board of Directors and delivered to the
Trustee, may surrender any of the powers reserved to the Company and thereupon
such power so surrendered shall terminate both as to the Company and as to any
permitted successor.

Section 14.04                          Addresses
for Notices, etc.

Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
the Securityholders on the Company may be given or served in writing by being
deposited postage prepaid by registered or certified mail in a post office
letter box addressed (until another address is filed by the Company with the
Trustee for such purpose) to the Company at 4275 Executive Square, Suite 650,
La Jolla, California 92037, Attention: Shelly Hicks.  Any notice, direction, request or demand by
any Securityholder or the Company 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 office of Wilmington Trust Company at Rodney Square North, 1100
North Market Street, Wilmington, DE 19890-0001, Attention: Corporate Capital
Markets.

Section 14.05                          Governing
Law.

This Indenture and the Debt Securities shall each be
governed by, and construed in accordance with, the laws of the State of New York,
without regard to conflict of laws principles of said State other than Section
5-1401 of the New York General Obligations Law.

Section 14.06                          Evidence
of Compliance with Conditions Precedent.

Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers’ Certificate stating that in
the opinion of the signers all conditions precedent, if any, 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

 57
 

have been complied with
(except that no such Opinion of Counsel is required to be furnished to the
Trustee in connection with the authentication and issuance of Debt Securities).

Each certificate or opinion provided for in this
Indenture and delivered to the Trustee with respect to compliance with a
condition or covenant provided for in this Indenture (except certificates
delivered pursuant to Section 3.05) shall include (a) a statement that the
person making such certificate or opinion has read such covenant or condition
and the definitions relating thereto; (b) 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; (c) a statement
that, in the opinion of such person, he or she has made such examination or
investigation as is necessary to enable him or her 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 or not, in the opinion of such person, such
condition or covenant has been complied with.

Section 14.07                          Business
Day Convention.

Notwithstanding anything to the contrary contained
herein, if any Interest Payment Date, other than the Maturity Date, any
Optional Redemption Date or the Special Redemption Date, falls on a day that is
not a Business Day, then any interest payable will be paid on, and such
Interest Payment Date will be moved to, the next succeeding Business Day, and
additional interest will accrue for each day that such payment is delayed as a
result thereof.  If the Maturity Date,
any Optional Redemption Date or the Special Redemption Date falls on a day that
is not a Business Day, then the principal, premium, if any, and/or interest
payable on such date will be paid on the next succeeding Business Day, and no
additional interest will accrue in respect of such payment made on such next
succeeding Business Day.

Section 14.08                          Table
of Contents, Headings, etc.

The table of contents and the titles and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.

Section 14.09                          Execution
in 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 14.10                          Separability.

In case any one or more of the provisions contained in
this Indenture or in the Debt Securities 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 such Debt Securities, but this Indenture and such Debt Securities shall be
construed as if such invalid, illegal or unenforceable provision had never been
contained herein or therein.

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Section 14.11                          Assignment.

Subject to Article XI, the Company will have the right
at all times to assign any of its rights or obligations under this Indenture
and the Debt Securities to a direct or indirect wholly owned Subsidiary of the
Company; provided, however, that, in the event of any such
assignment, the Company will 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 thereto.

Section 14.12                          Acknowledgment
of Rights.

The Company acknowledges that, with respect to any
Debt Securities held by the Trust or a trustee of the Trust, if such trustee of
the Trust fails to enforce its rights under this Indenture as the holder of
Debt Securities held as the assets of the Trust after the holders of a majority
in aggregate liquidation amount of the outstanding Capital Securities of the
Trust have so directed in writing such trustee, a holder of record of such
Capital Securities may, to the fullest extent permitted by law, institute legal
proceedings directly against the Company to enforce such trustee’s rights under
this Indenture without first instituting any legal proceedings against such
trustee or any other Person. 
Notwithstanding the foregoing, if an Event of Default has occurred and
is continuing and such event is attributable to the failure of the Company to
pay interest or premium, if any, on or principal of the Debt Securities on the
date such interest, premium, if any, or principal is otherwise due and payable
(or, in the case of redemption, on the related Optional Redemption Date or the
Special Redemption Date (as the case may be)), the Company acknowledges that a
holder of outstanding Capital Securities of the Trust may directly institute a
proceeding against the Company for enforcement of payment to such holder
directly of the principal of or premium, if any, or interest on the Debt
Securities having an aggregate principal amount equal to the aggregate
liquidation amount of the Capital Securities of such holder on or after the
respective due date (or Optional Redemption Date or Special Redemption Date (as
the case may be)) specified in the Debt Securities.

ARTICLE XV

SUBORDINATION OF DEBT SECURITIES

Section 15.01                          Agreement
to Subordinate.

The Company covenants and agrees, and each holder of
Debt Securities issued hereunder and under any supplemental indenture (the “Additional
Provisions”) by such holder’s acceptance thereof likewise covenants and agrees,
that all Debt Securities shall be issued subject to the provisions of this
Article XV; and each holder of a Debt Security, whether upon original issue or
upon transfer or assignment thereof, accepts and agrees to be bound by such
provisions.

The payment by the Company of the payments due on all
Debt Securities issued hereunder and under any Additional Provisions 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 Indebtedness of
the Company, whether outstanding at the date of this Indenture or thereafter
incurred.

 59
 

No provision of this Article XV shall prevent the
occurrence of any default or Event of Default hereunder.

Section 15.02                          Default
on Senior Indebtedness.

In the event and during the continuation of any
default by the Company in the payment of principal, premium, interest or any
other amount due on any Senior Indebtedness of the Company following any
applicable grace period, or in the event that the maturity of any Senior
Indebtedness of the Company has been accelerated because of a default, and such
acceleration has not been rescinded or canceled and such Senior Indebtedness
has not been paid in full, then, in either case, no payment shall be made by
the Company with respect to the payments due on the Debt Securities.

In the event that, notwithstanding the foregoing, any
payment shall be received by the Trustee or any Securityholder when such
payment is prohibited by the preceding paragraph of this Section, such payment
shall, subject to Section 15.06, 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
trustee) notify 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 15.03                          Liquidation;
Dissolution; Bankruptcy.

Upon any payment by the Company or distribution of
assets of the Company of any kind or character, whether in cash, property or securities,
to creditors upon any dissolution, winding-up, liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due upon all Senior Indebtedness
of the Company 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 Company
on the Debt Securities; and upon any such dissolution, winding-up, liquidation
or reorganization, any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the Securityholders or the Trustee would be entitled to receive from the
Company, except for the provisions of this Article XV, shall be paid by the
Company, or by any receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, or by the Securityholders
or by the Trustee under this Indenture if received by them or it, directly to
the holders of Senior Indebtedness of the Company (pro rata to such holders on
the basis of the respective amounts of Senior Indebtedness held by such
holders, as calculated by the Company) 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 Securityholders
or to the Trustee.

 60
 

In the event that, notwithstanding the foregoing, any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, prohibited by the foregoing shall be
received by the Trustee or any Securityholder before all Senior Indebtedness of
the Company 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 Company, for application to the
payment of all Senior Indebtedness of the Company 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.

For purposes of this Article XV, the words “cash,
property or securities” shall not be deemed to include shares of stock of the
Company as reorganized or readjusted, or securities of the Company 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 XV with respect to the Debt Securities to the payment of all Senior
Indebtedness of the Company, that may at the time be outstanding, provided,
that (a) such Senior Indebtedness is assumed by the new corporation, if any,
resulting from any such reorganization or readjustment, and (b) 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 Company with, or the
merger of the Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance, transfer or other
disposition of its property as an entirety, or substantially as an entirety, to
another corporation upon the terms and conditions provided for in Article XI of
this Indenture shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section if such other corporation
shall, as a part of such consolidation, merger, conveyance or transfer, comply
with the conditions stated in Article XI of this Indenture.  Nothing in Section 15.02 or in this Section
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 6.06 of this Indenture.

Section 15.04                          Subrogation.

Subject to the payment in full of all Senior
Indebtedness of the Company, the Securityholders 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 Company applicable to such
Senior Indebtedness until all payments due on the Debt Securities 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 Securityholders or the Trustee would be entitled
except for the provisions of this Article XV, and no payment over pursuant to
the provisions of this Article XV to or for the benefit of the holders of such
Senior Indebtedness by Securityholders or the Trustee, shall, as between the
Company, its creditors other than holders of Senior Indebtedness of the
Company, and the holders of the Debt Securities be deemed to be a payment or
distribution by the Company to or on account of such Senior Indebtedness.  It is understood that the provisions of this
Article XV are, and are intended, solely for the purposes of

 61
 

defining the relative
rights of the holders of the Debt Securities, on the one hand, and the holders
of such Senior Indebtedness, on the other hand.

Nothing contained in this Article XV or elsewhere in
this Indenture, any Additional Provisions or in the Debt Securities is intended
to or shall impair, as between the Company, its creditors other than the
holders of Senior Indebtedness of the Company, and the holders of the Debt
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the holders of the Debt Securities all payments on the Debt
Securities 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 Debt Securities and creditors of the Company other than the
holders of Senior Indebtedness of the Company, nor shall anything herein or
therein prevent the Trustee or the holder of any Debt Security from exercising
all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article XV of the holders
of such Senior Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.

Upon any payment or distribution of assets of the
Company referred to in this Article XV, the Trustee, subject to the provisions
of Article VI of this Indenture, and the Securityholders 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 Securityholders,
for the purposes of ascertaining the Persons entitled to participate in such
distribution, the holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article
XV.

Section 15.05                          Trustee
to Effectuate Subordination.

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

Section 15.06                          Notice
by the Company.

The Company shall give prompt written notice to a
Responsible Officer of the Trustee at the Principal Office of the Trustee of
any fact known to the Company that would prohibit the making of any payment of
moneys to or by the Trustee in respect of the Debt Securities pursuant to the
provisions of this Article XV. 
Notwithstanding the provisions of this Article XV or any other provision
of this Indenture or any Additional Provisions, the Trustee shall not be charged
with knowledge of the existence of any facts that would prohibit the making of
any payment of moneys to or by the Trustee in respect of the Debt Securities
pursuant to the provisions of this Article XV unless and until a Responsible
Officer of the Trustee at the Principal Office of the Trustee shall have
received written notice thereof from the Company 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 Article VI of
this Indenture,

 62
 

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 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 premium, if any, or interest on
any Debt Security), 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.

The Trustee, subject to the provisions of Article VI
of this Indenture, shall be entitled to conclusively rely on the delivery to it
of a written notice by a Person representing himself or herself to be a holder
of Senior Indebtedness of the Company (or a trustee or representative on behalf
of such holder) to establish that such notice has been given by a holder of
such Senior Indebtedness or a trustee or representative 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 XV, 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 XV, 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 15.07                          Rights
of the Trustee; Holders of Senior Indebtedness.

The Trustee, in its individual capacity, shall be
entitled to all the rights set forth in this Article XV 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 or any Additional
Provisions shall deprive the Trustee of any of its rights as such holder.

With respect to the holders of Senior Indebtedness of
the Company, the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this Article XV, and
no implied covenants or obligations with respect to the holders of such Senior
Indebtedness shall be read into this Indenture or any Additional Provisions
against the Trustee.  The Trustee shall
not owe or be deemed to owe any fiduciary duty to the holders of such Senior
Indebtedness and, subject to the provisions of Article VI of this Indenture,
the Trustee shall not be liable to any holder of such Senior Indebtedness if it
shall pay over or deliver to Securityholders, the Company or any other Person
money or assets to which any holder of such Senior Indebtedness shall be
entitled by virtue of this Article XV or otherwise.

Nothing in this Article XV shall apply to claims of,
or payments to, the Trustee under or pursuant to Section 6.06.

Section 15.08                          Subordination
May Not Be Impaired.

No right of any present or future holder of any Senior
Indebtedness of the Company to enforce subordination as herein provided shall
at any time in any way be prejudiced

 63
 

or impaired by any act or
failure to act on the part of the Company, or by any act or failure to act, in
good faith, by any such holder, or by any noncompliance by the Company, 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.

Without in any way limiting the generality of the
foregoing paragraph, the holders of Senior Indebtedness of the Company may, at
any time and from time to time, without the consent of or notice to the Trustee
or the Securityholders, without incurring responsibility to the Securityholders
and without impairing or releasing the subordination provided in this Article
XV or the obligations hereunder of the holders of the Debt Securities to the
holders of such Senior Indebtedness, do any one or more of the following: (a)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, such Senior 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; (b) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Senior Indebtedness; (c) release any Person liable in
any manner for the collection of such Senior Indebtedness; and (d) exercise or
refrain from exercising any rights against the Company or any other Person.

 64
 

Wilmington Trust Company, in its capacity as Trustee,
hereby accepts the trusts in this Indenture declared and provided, upon the
terms and conditions herein above set forth.

IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed by their respective officers thereunto duly
authorized, as of the day and year first above written.

	
   

  	
  1ST PACIFIC BANCORP

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James H.
  Burgess

  	
   

  
	
   

  	
   

  	
  Name: James H.
  Burgess

  
	
   

  	
   

  	
  Title: EVP Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WILMINGTON TRUST
  COMPANY,

  
	
   

  	
   

  	
  as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Thomas
  Morris II

  	
   

  
	
   

  	
   

  	
  Name: W. Thomas
  Morris II

  
	
   

  	
   

  	
  Title: Assistant
  Vice President

  
							

 

 65

EXHIBIT A

FORM OF DEBT SECURITY

[FORM OF FACE OF
SECURITY]

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

UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.](1)

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR
ANY OTHER APPLICABLE SECURITIES LAWS. 
NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT.  THE HOLDER OF THIS SECURITY OR ANY
INTEREST OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE
CASE MAY BE, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY OR ANY
INTEREST OR PARTICIPATION HEREIN PRIOR TO THE DATE WHICH IS THE LATER OF (i)
TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE
SECURITIES ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF AND
(Z) THE LAST DATE

(1) Only applicable if this Debt Security is a Global Debt Security.

ON WHICH THE COMPANY OR ANY
AFFILIATE (AS DEFINED IN RULE 405 UNDER THE SECURITIES ACT) OF THE COMPANY WAS
THE HOLDER OF THIS SECURITY OR SUCH INTEREST OR PARTICIPATION (OR ANY
PREDECESSOR THERETO) AND (ii) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY
ANY SUBSEQUENT CHANGE IN APPLICABLE LAW, ONLY (A) TO THE COMPANY, (B) PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON THE HOLDER
REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER”, AS DEFINED IN RULE
144A, THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (C) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT TO AN “ACCREDITED INVESTOR” WITHIN THE
MEANING OF SUBPARAGRAPH (a) (1), (2), (3), (7) OR (8) OF RULE 501 UNDER THE
SECURITIES ACT THAT IS ACQUIRING THIS SECURITY OR SUCH INTEREST OR
PARTICIPATION FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN ACCREDITED
INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (D)
PURSUANT TO OFFERS AND SALES TO NON-US PERSONS THAT OCCUR OUTSIDE THE UNITED
STATES PURSUANT TO REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER PURSUANT TO CLAUSE (C) OR (E) ABOVE TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO IT
IN ACCORDANCE WITH THE INDENTURE, A COPY OF WHICH MAY BE OBTAINED FROM THE
COMPANY.  THE HOLDER OF THIS SECURITY OR
ANY INTEREST OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS
THE CASE MAY BE, AGREES THAT IT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.

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

 A-2
 

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

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

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

THIS OBLIGATION IS NOT A DEPOSIT AND IS NOT
INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES,
INCLUDING THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE “FDIC”).  THIS OBLIGATION IS SUBORDINATED TO THE CLAIMS
OF THE DEPOSITORS AND THE CLAIMS OF GENERAL AND SECURED CREDITORS OF THE
COMPANY, IS INELIGIBLE AS COLLATERAL FOR A LOAN BY THE COMPANY OR ANY OF ITS
SUBSIDIARIES AND IS NOT SECURED.

 A-3
 

Floating Rate
Junior Subordinated Debt Security due 2037

of

1ST PACIFIC
BANCORP

1st Pacific Bancorp,
a bank holding company incorporated in the State of California (the “Company”,
which term includes any successor permitted under the Indenture (as defined
herein)), for value received, promises to pay to Wilmington Trust Company, not
in its individual capacity but solely as Institutional Trustee for FPBN Trust
I, a Delaware statutory trust, or registered assigns, the principal amount of                                
Dollars ($                             )
on September 1, 2037 (the “Maturity Date”) (or any Optional
Redemption Date or the Special Redemption Date, each as defined herein, or any
earlier date of acceleration of the maturity of this Debt Security), and to pay
interest on the outstanding principal amount of this Debt Security from June
28, 2007, or from the most recent Interest Payment Date (as defined below) to
which interest has been paid or duly provided for, quarterly (subject to
deferral as set forth herein) in arrears on March 1, June 1, September 1 and
December 1 of each year, commencing on September 1, 2007 (each, an “Interest
Payment Date”), at a rate per annum, which, with respect to any Interest Period
(as defined in the Indenture), will be equal to LIBOR (as defined in the
Indenture), as determined on the LIBOR Determination Date (as defined in the
Indenture) for such Interest Period (or, in the case of the first Interest
Period, will be 5.36%), plus 1.40% (the “Interest Rate”) (provided that
the Interest Rate for any Interest Period may not exceed the highest rate
permitted by New York law, as the same may be modified by United States law of
general application) until the principal hereof shall have been paid or duly
provided for, and on any overdue principal and (without duplication and to the
extent that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at an annual rate equal to the then applicable
Interest Rate, compounded quarterly.  The
amount of interest payable for any Interest Period shall be computed on the
basis of a 360-day year and the actual number of days elapsed in such Interest
Period.

The interest installment so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in
the Indenture, be paid to the Person in whose name this Debt Security (or one
or more Predecessor Securities, as defined in the Indenture) is registered at
the close of business on the “regular record date” for such interest
installment, which shall be the fifteenth day prior to such Interest Payment
Date, whether or not such day is a Business Day (as defined herein).  Any such interest installment (other than
Deferred Interest (as defined herein)) not punctually paid or duly provided for
shall forthwith cease to be payable to the holders on such regular record date
and may be paid to the Person in whose name this Debt Security (or one or more
Predecessor Securities) is registered at the close of business on a special
record date to be fixed by the Trustee for the payment of such defaulted
interest, notice whereof shall be given to the holders of the Debt Securities
not less than 10 days prior to such special record date, all as more fully
provided in the Indenture.

Payment of the principal of and premium, if any, and
interest on this Debt Security due on the Maturity Date, any Optional
Redemption Date or the Special Redemption Date, as the case may be, shall be
made in immediately available funds against presentation and surrender of this
Debt Security at the office or agency of the Trustee maintained for that
purpose

 A-4
 

in Wilmington, Delaware,
or at the office or agency of any other Paying Agent appointed by the Company
maintained for that purpose in Wilmington, Delaware or Sacramento,
California.  Payment of interest on this
Debt Security due on any Interest Payment Date other than the Maturity Date,
any Optional Redemption Date or the Special Redemption Date, as the case may
be, shall be made at the option of the Company by check mailed to the holder
thereof at such address as shall appear in the Debt Security Register or by
wire transfer of immediately available funds to an account appropriately
designated by the holder hereof. 
Notwithstanding the foregoing, so long as the holder of this Debt
Security is the Institutional Trustee, payment of the principal of and premium,
if any, and interest on this Debt Security shall be made in immediately
available funds when due at such place and to such account as may be designated
by the Institutional Trustee.  All
payments in respect of this Debt Security shall be payable in any coin or
currency of the United States of America that at the time of payment is legal
tender for payment of public and private debts.

Notwithstanding anything to the contrary contained
herein, if any Interest Payment Date, other than the Maturity Date, any
Optional Redemption Date or the Special Redemption Date, falls on a day that is
not a Business Day, then any interest payable will be paid on, and such
Interest Payment Date will be moved to, the next succeeding Business Day, and
additional interest will accrue for each day that such payment is delayed as a
result thereof.  If the Maturity Date,
any Optional Redemption Date or the Special Redemption Date falls on a day that
is not a Business Day, then the principal, premium, if any, and/or interest payable
on such date will be paid on the next succeeding Business Day, and no
additional interest will accrue in respect of such payment made on such next
succeeding Business Day.

So long as no Event of Default pursuant to Sections
5.01(b), (e), (f), (g), (h) or (i) of the Indenture has occurred and is
continuing, the Company shall have the right, from time to time and without
causing an Event of Default, to defer payments of interest on the Debt
Securities by extending the interest payment period on the Debt Securities at
any time and from time to time during the term of the Debt Securities, for up
to 20 consecutive quarterly periods (each such extended interest payment
period, together with all previous and further consecutive extensions thereof,
is referred to herein as an “Extension Period”).  No Extension Period may end on a date other
than an Interest Payment Date or extend beyond the Maturity Date, any Optional
Redemption Date or the Special Redemption Date, as the case may be.  During any Extension Period, interest will
continue to accrue on the Debt Securities, and interest on such accrued
interest (such accrued interest and interest thereon referred to herein as “Deferred
Interest”) will accrue at an annual rate equal to the Interest Rate applicable
during such Extension Period, compounded quarterly from the date such Deferred
Interest would have been payable were it not for the Extension Period, to the
extent permitted by applicable law.  No
interest or Deferred Interest (except any Additional Amounts (as defined in the
Indenture) that may be due and payable) shall be due and payable during an
Extension Period, except at the end thereof. 
At the end of any Extension Period, the Company shall pay all Deferred
Interest then accrued and unpaid on the Debt Securities; provided, however,
that during any Extension Period, the Company may not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company’s capital stock, (ii)
make any payment of principal of or premium, if any, or interest on or repay,
repurchase or redeem any debt securities of the Company that rank pari passu in all respects with or junior in interest to the
Debt Securities or (iii) make any payment under any guarantees of the Company

 A-5
 

that rank in all respects
pari passu with or junior in respect to
the Capital Securities Guarantee   (other
than (a) repurchases, redemptions or other acquisitions of shares of capital
stock of the Company (A) in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of one or more
employees, officers, directors or consultants, (B) in connection with a
dividend reinvestment or stockholder stock purchase plan or (C) in connection
with the issuance of capital stock of the Company (or securities convertible
into or exercisable for such capital stock), as consideration in an acquisition
transaction entered into prior to such Extension Period, (b) as a result of any
exchange or conversion of any class or series of the Company’s capital stock
(or any capital stock of a subsidiary of the Company) for any class or series
of the Company’s capital stock or of any class or series of the Company’s
indebtedness for any class or series of the Company’s capital stock, (c) the
purchase of fractional interests in shares of the Company’s capital stock
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (d) any declaration of a dividend in
connection with any stockholder’s rights plan, or the issuance of rights, stock
or other property under any stockholder’s rights plan, or the redemption or
repurchase of rights pursuant thereto or (e) any dividend in the form of stock,
warrants, options or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other rights is the same
stock as that on which the dividend is being paid or ranks pari passu
with or junior to such stock).  Prior to
the termination of any Extension Period, the Company may further extend such
Extension Period, provided, that no Extension Period (including all
previous and further consecutive extensions that are part of such Extension
Period) shall exceed 20 consecutive quarterly periods.  Upon the termination of any Extension Period
and upon the payment of all Deferred Interest, the Company may commence a new
Extension Period, subject to the foregoing requirements.  The Company must give the Trustee notice of
its election to begin or extend an Extension Period no later than the close of
business on the fifteenth Business Day prior to the applicable Interest Payment
Date.

The indebtedness evidenced by this Debt Security is,
to the extent provided in the Indenture, subordinate and junior in right of
payment to the prior payment in full of all Senior Indebtedness (as defined in
the Indenture), and this Debt Security is issued subject to the provisions of
the Indenture with respect thereto.  Each
holder of this Debt Security, by accepting the same, (a) agrees to and shall be
bound by such provisions, (b) authorizes and directs the Trustee on such holder’s
behalf to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination so provided and (c) appoints the Trustee such
holder’s attorney-in-fact for any and all such purposes.  Each holder hereof, by such holder’s
acceptance hereof, hereby waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by each holder
of Senior Indebtedness, whether now outstanding or hereafter incurred, and
waives reliance by each such holder upon said provisions.

The Company waives diligence, presentment, demand for
payment, notice of nonpayment, notice of protest, and all other demands and
notices.

This Debt Security shall not be entitled to any
benefit under the Indenture hereinafter referred to and shall not be valid or
become obligatory for any purpose until the certificate of authentication
hereon shall have been signed by or on behalf of the Trustee.

 A-6
 

The provisions of this
Debt Security are continued on the reverse side hereof and such continued
provisions shall for all purposes have the same effect as though fully set
forth at this place.

This Debt Security may
contain more than one counterpart of the signature page and this Debt Security
may be executed and authenticated by the affixing of the signature of a proper
officer of the Company, and the signature of the Trustee providing
authentication, to any of such counterpart signature pages.  All of such counterpart signature pages shall
be read as though one, and they shall have the same force and effect as though
the Company had executed, and the Trustee had authenticated, a single signature
page.

 A-7
 

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

	
  

  	
  1ST PACIFIC BANCORP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Dated:                                       ,
               

CERTIFICATE OF AUTHENTICATION

This certificate represents Debt Securities referred
to in the within-mentioned Indenture.

	
  

  	
  WILMINGTON TRUST
  COMPANY,

  not in its individual capacity but solely as

  the Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Officer

  
	
   

  	
   

  	
   

  

 

Dated:                                       ,
               

 A-8
 

[FORM OF REVERSE
OF SECURITY]

This Debt Security is one of a duly authorized series
of debt securities of the Company (collectively, the “Debt Securities”), all
issued or to be issued pursuant to an Indenture (the “Indenture”), dated as of
June 28, 2007, duly executed and delivered between the Company and Wilmington
Trust Company, as Trustee (the “Trustee”), to which Indenture and all
indentures supplemental thereto reference is hereby made for a description of
the rights, limitations of rights, obligations, duties and immunities thereunder
of the Trustee, the Company and the holders of the Debt Securities of which
this Debt Security is a part.

Upon the occurrence and continuation of a Tax Event,
an Investment Company Event or a Capital Treatment Event (each, a “Special
Event”), the Company shall have the right to redeem this Debt Security, at its
option, in whole with all other Debt Securities but not in part, at any time,
within 90 days following the occurrence of such Special Event (the “Special
Redemption Date”), at the Special Redemption Price (as defined herein).

The Company shall also have the right to redeem this
Debt Security at its option, in whole or (provided that all accrued and unpaid
interest has been paid on all Debt Securities for all Interest Periods
terminating on or prior to such date) from time to time in part, on any
Interest Payment Date on or after September 1, 2012 (each, an “Optional
Redemption Date”), at the Optional Redemption Price (as defined herein).

Any redemption pursuant to the preceding two
paragraphs will be made, subject to receipt by the Company of prior approval
from the Board of Governors of the Federal Reserve System (the “Federal Reserve”)
if then required under applicable capital guidelines or policies of the Federal
Reserve, upon not less than 30 days’ nor more than 60 days’ prior written
notice.  If the Debt Securities are only
partially redeemed by the Company, the Debt Securities will be redeemed pro
rata or by any other method utilized by the Trustee.  In the event of redemption of this Debt
Security in part only, a new Debt Security or Debt Securities for the
unredeemed portion hereof will be issued in the name of the holder hereof upon
the cancellation hereof.

“Optional Redemption Price” means an amount in cash
equal to 100% of the principal amount of this Debt Security being redeemed plus
unpaid interest accrued thereon to the related Optional Redemption Date.

“Special Redemption Price” means, with respect to the
redemption of this Debt Security following a Special Event, an amount in cash
equal to 103.40% of the principal amount of this Debt Security to be redeemed
prior to September 1, 2008 and thereafter equal to the percentage of the
principal amount of this Debt Security that is specified below for the Special
Redemption Date plus, in each case, unpaid interest accrued thereon to the
Special Redemption Date:

 A-9
 

 

	
  Special Redemption During the 12-Month

  Period Beginning September 1,

  	
   

  	
  Percentage of Principal Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  102.72

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  102.04

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2010

  	
   

  	
  101.36

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2011

  	
   

  	
  100.68

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2012 and
  thereafter

  	
   

  	
  100.00

  	
  %

  

 

In case an Event of Default, as defined in the
Indenture, shall have occurred and be continuing, the principal of all of the
Debt Securities may be declared, and, in certain cases, shall ipso  facto
become, due and payable, and upon any such declaration of acceleration shall
become due and payable, in each case, in the manner, with the effect and
subject to the conditions provided in the Indenture.

The Indenture contains provisions permitting the
Company and the Trustee, with the consent of the holders of a majority in
aggregate principal amount of the Debt Securities at the time outstanding
affected thereby, as specified in the Indenture, to execute supplemental
indentures for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or of modifying in any manner the rights of the holders
of the Debt Securities; provided, however, that no such supplemental
indenture shall, among other things, without the consent of the holders of each
Debt Security then outstanding and affected thereby (i) change the
Maturity Date of any Debt Security, or reduce the principal amount thereof or
any premium thereon, or reduce the rate (or manner of calculation of the rate)
or extend the time of payment of interest thereon, or reduce (other than as a
result of the maturity or earlier redemption of any such Debt Security in
accordance with the terms of the Indenture and such Debt Security) or increase
the aggregate principal amount of Debt Securities then outstanding, or change
any of the redemption provisions, or make the principal thereof or any interest
or premium thereon payable in any coin or currency other than United States
Dollars, or impair or affect the right of any holder to institute suit for
payment thereof, or (ii) reduce the aforesaid percentage of Debt
Securities the holders of which are required to consent to any such
supplemental indenture.  The Indenture
also contains provisions permitting the holders of a majority in aggregate
principal amount of the Debt Securities at the time outstanding, on behalf of
the holders of all the Debt Securities, to waive any past default in the
performance of any of the covenants contained in the Indenture, or established
pursuant to the Indenture, and its consequences, except (a) a default in
payments due in respect of any of the Debt Securities, (b) in respect of
covenants or provisions of the Indenture which cannot be modified or amended
without the consent of the holder of each Debt Security affected, or
(c) in respect of the covenants of the Company relating to its ownership
of Common Securities of the Trust.  Any
such consent or waiver by the holder of this Debt Security (unless revoked as
provided in the Indenture) shall be conclusive and binding upon such holder and
upon

 A-10
 

all future holders and
owners of this Debt Security and of any Debt Security issued in exchange
herefor or in place hereof (whether by registration of transfer or otherwise),
irrespective of whether or not any notation of such consent or waiver is made
upon this Debt Security.

No reference herein to the Indenture and no provision
of this Debt Security or of the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to make all payments due
on this Debt Security at the time and place and at the rate and in the money
herein prescribed.

As provided in the Indenture and subject to certain
limitations herein and therein set forth, this Debt Security is transferable by
the holder hereof on the Debt Security Register (as defined in the Indenture)
of the Company, upon surrender of this Debt Security for registration of
transfer at the office or agency of the Trustee in Wilmington, Delaware, or at
any other office or agency of the Company in Wilmington, Delaware or
Sacramento, California, accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company or the Trustee duly executed by the
holder hereof or such holder’s attorney duly authorized in writing, and
thereupon one or more new Debt Securities of authorized denominations and for
the same aggregate principal amount will be issued to the designated transferee
or transferees.  No service charge will
be made for any such registration of transfer, but the Company or the Trustee
may require payment of a sum sufficient to cover any tax, fee or other
governmental charge payable in relation thereto as specified in the Indenture.

Prior to due presentment for registration of transfer
of this Debt Security, the Company, the Trustee, any Authenticating Agent, any
Paying Agent, any transfer agent and the Debt Security registrar may deem and
treat the holder hereof as the absolute owner hereof (whether or not this Debt
Security shall be overdue and notwithstanding any notice of ownership or
writing hereon) for the purpose of receiving payment of the principal of and
premium, if any, and interest on this Debt Security and for all other purposes,
and none of the Company, the Trustee, any Authenticating Agent, any Paying
Agent, any transfer agent or any Debt Security registrar shall be affected by
any notice to the contrary.

As provided in the Indenture and subject to certain
limitations herein and therein set forth, Debt Securities are exchangeable for
a like aggregate principal amount of Debt Securities of different authorized
denominations, as requested by the holder surrendering the same.

The Debt Securities are issuable only in registered
certificated form without coupons.

No recourse shall be had for the payment of the
principal of or premium, if any, or interest on this Debt Security, or for any
claim based hereon, or otherwise in respect hereof, or based on or in respect
of the Indenture, against any incorporator, stockholder, officer, director,
employee or agent, past, present or future, as such, of the Company or of any
predecessor or successor corporation of the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise, all such liability being, by the acceptance hereof and
as part of the consideration for the issuance hereof, expressly waived and
released.

 A-11
 

All terms used but not defined in this Debt Security
shall have the meanings assigned to them in the Indenture.

THIS DEBT SECURITY SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES OF SAID STATE OTHER THAN SECTION 5-1401 OF THE NEW
YORK GENERAL OBLIGATIONS LAW.

 A-12

EXHIBIT B

FORM OF CERTIFICATE OF OFFICER OF THE COMPANY

Pursuant
to Section 3.05 of the Indenture, dated as of June 28, 2007 (as amended or
supplemented from time to time, the “Indenture”), between 1st Pacific Bancorp, as issuer (the “Company”),
and Wilmington Trust Company, as trustee, the undersigned certifies that he/she
is a [principal executive officer, principal financial officer or principal
accounting officer] of the Company and in the course of the performance by the
undersigned of his/her duties as an officer of the Company, the undersigned
would normally have knowledge of any default by the Company in the performance
of any covenants contained in the Indenture, and the undersigned hereby further
certifies that he/she has no knowledge of any default for the fiscal year
ending on                           , 20       
[, except as follows: specify each such default
and the nature thereof].

Capitalized
terms used herein, and not otherwise defined herein, have the respective
meanings assigned thereto in the Indenture.

IN
WITNESS WHEREOF, the undersigned has executed this Certificate as of

                          , 20       

	
  

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 B-1Exhibit 10.3

GUARANTEE
AGREEMENT

1ST PACIFIC BANCORP

Dated as of June 28, 2007

TABLE OF
CONTENTS

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  
	
   

  
	
  DEFINITIONS AND
  INTERPRETATION

  
	
   

  
	
  SECTION 1.1

  	
   

  	
  Definitions and Interpretation.

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
   

  
	
  POWERS, DUTIES
  AND RIGHTS OF THE GUARANTEE TRUSTEE

  
	
   

  
	
  SECTION 2.1

  	
   

  	
  Powers and Duties of the Guarantee Trustee.

  	
   

  	
  4

  
	
  SECTION 2.2

  	
   

  	
  Certain Rights of the Guarantee Trustee.

  	
   

  	
  5

  
	
  SECTION 2.3

  	
   

  	
  Not Responsible for Recitals or Issuance of
  Guarantee.

  	
   

  	
  7

  
	
  SECTION 2.4

  	
   

  	
  Events of Default; Waiver.

  	
   

  	
  7

  
	
  SECTION 2.5

  	
   

  	
  Events of Default; Notice.

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
   

  
	
  THE GUARANTEE
  TRUSTEE

  
	
   

  
	
  SECTION 3.1

  	
   

  	
  The Guarantee Trustee; Eligibility.

  	
   

  	
  8

  
	
  SECTION 3.2

  	
   

  	
  Appointment, Removal and Resignation of the
  Guarantee Trustee.

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  
	
  GUARANTEE

  
	
   

  
	
  SECTION 4.1

  	
   

  	
  Guarantee.

  	
   

  	
  9

  
	
  SECTION 4.2

  	
   

  	
  Waiver of Notice and Demand.

  	
   

  	
  10

  
	
  SECTION 4.3

  	
   

  	
  Obligations Not Affected.

  	
   

  	
  10

  
	
  SECTION 4.4

  	
   

  	
  Rights of Holders.

  	
   

  	
  11

  
	
  SECTION 4.5

  	
   

  	
  Guarantee of Payment.

  	
   

  	
  11

  
	
  SECTION 4.6

  	
   

  	
  Subrogation.

  	
   

  	
  11

  
	
  SECTION 4.7

  	
   

  	
  Independent Obligations.

  	
   

  	
  12

  
	
  SECTION 4.8

  	
   

  	
  Enforcement.

  	
   

  	
  12

  
	
  ARTICLE V

  
	
   

  
	
  LIMITATION OF
  TRANSACTIONS; SUBORDINATION

  
	
   

  
	
  SECTION 5.1

  	
   

  	
  Limitation of Transactions.

  	
   

  	
  12

  
	
  SECTION 5.2

  	
   

  	
  Ranking.

  	
   

  	
  13

  
							

 

 i
 

 

	
  ARTICLE VI

  
	
   

  
	
  TERMINATION

  
	
   

  
	
  SECTION 6.1

  	
   

  	
  Termination.

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  
	
  INDEMNIFICATION

  
	
   

  
	
  SECTION 7.1

  	
   

  	
  Exculpation.

  	
   

  	
  13

  
	
  SECTION 7.2

  	
   

  	
  Indemnification.

  	
   

  	
  14

  
	
  SECTION 7.3

  	
   

  	
  Compensation; Reimbursement of Expenses.

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  
	
   

  
	
  MISCELLANEOUS

  
	
   

  
	
  SECTION 8.1

  	
   

  	
  Successors and Assigns.

  	
   

  	
  15

  
	
  SECTION 8.2

  	
   

  	
  Amendments.

  	
   

  	
  16

  
	
  SECTION 8.3

  	
   

  	
  Notices.

  	
   

  	
  16

  
	
  SECTION 8.4

  	
   

  	
  Benefit.

  	
   

  	
  16

  
	
  SECTION 8.5

  	
   

  	
  Governing Law.

  	
   

  	
  16

  
	
  SECTION 8.6

  	
   

  	
  Counterparts.

  	
   

  	
  17

  

 

 ii

GUARANTEE
AGREEMENT

This GUARANTEE AGREEMENT (the “Guarantee”), dated as
of June 28, 2007, is executed and delivered by 1st Pacific Bancorp, a bank
holding company incorporated in the State of California (the “Guarantor”), and
Wilmington Trust Company, a Delaware banking corporation, as trustee (the “Guarantee
Trustee”), for the benefit of the Holders (as defined herein) from time to time
of the Capital Securities (as defined herein) of FPBN Trust I, a Delaware
statutory trust (the “Issuer”).

WHEREAS, pursuant to an Amended and Restated
Declaration of Trust (the “Declaration”), dated as of June 28, 2007, among the
trustees named therein of the Issuer, 1st Pacific Bancorp, as sponsor, and the
Holders from time to time of undivided beneficial interests in the assets of
the Issuer, the Issuer is issuing on the date hereof securities, having an
aggregate liquidation amount of $5,000,000, designated in the Declaration as
MMCapSSM (the “Capital Securities”); and

WHEREAS, as incentive for the Holders to purchase the
Capital Securities, the Guarantor desires irrevocably and unconditionally to
agree, to the extent set forth in this Guarantee, to pay to the Holders of
Capital Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the purchase by
each Holder of the Capital Securities, which purchase the Guarantor hereby
agrees shall benefit the Guarantor, the Guarantor executes and delivers this
Guarantee for the benefit of the Holders.

ARTICLE I

DEFINITIONS AND
INTERPRETATION

SECTION 1.1                          Definitions
and Interpretation.

In this Guarantee, unless the context otherwise
requires:

(a)                                  capitalized
terms used in this Guarantee but not defined in the preamble above have the
respective meanings assigned to them in this Section 1.1;

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

(c)                                  all
references to “the Guarantee” or “this Guarantee” are to this Guarantee as
modified, supplemented or amended from time to time;

(d)                                 all
references in this Guarantee to Articles and Sections are to Articles and
Sections of this Guarantee, unless otherwise specified;

(e)                                  terms
defined in the Declaration as of the date of execution of this Guarantee have
the same meanings when used in this Guarantee, unless otherwise defined in this
Guarantee or unless the context otherwise requires; and

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

“Beneficiaries” means any Person to whom the Issuer is
or hereafter becomes indebted or liable.

“Common Securities” has the meaning specified in the
Declaration.

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

“Covered Person” means any Holder of Capital Securities.

“Debenture Issuer” means 1st Pacific Bancorp or any
successor entity resulting from any consolidation, amalgamation, merger or
other business combination, in its capacity as issuer of the Debentures.

“Debentures” means the junior subordinated debentures
of the Debenture Issuer that are designated in the Indenture as the “Floating
Rate Junior Subordinated Debt Securities due 2037” and held by the
Institutional Trustee (as defined in the Declaration) of the Issuer.

“Event of Default” has the meaning set forth in
Section 2.4.

“Guarantee Payments” means the following payments or
distributions, without duplication, with respect to the Capital Securities, to
the extent not paid or made by the Issuer: (i) any accrued and unpaid
Distributions (as defined in the Declaration) which are required to be paid on
such Capital Securities to the extent the Issuer has funds available in the
Property Account (as defined in the Declaration) therefor at such time, (ii)
the price payable upon the redemption of any Capital Securities to the extent
the Issuer has funds available in the Property Account therefor at such time,
with respect to any Capital Securities that are (1) called for redemption by
the Issuer or (2) mandatorily redeemed by the Issuer, in each case, in accordance
with the terms of such Capital Securities, and (iii) upon a voluntary or
involuntary liquidation, dissolution, winding-up or termination of the Issuer
(other than in connection with the distribution of Debentures to the Holders of
the Capital Securities in exchange therefor as provided in the Declaration),
the lesser of (a) the aggregate of the liquidation amount of the Capital
Securities and all accrued and unpaid Distributions on the Capital Securities
to the date of payment, to the extent the Issuer has funds available in the
Property Account therefor at such time, and (b) the amount of assets of the
Issuer remaining available for distribution to Holders in liquidation of the
Issuer after satisfaction of liabilities to creditors of the Issuer as required
by applicable law (in either case, the “Liquidation Distribution”).

“Guarantee Trustee” means Wilmington Trust Company,
until a Successor Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Guarantee and thereafter means each
such Successor Guarantee Trustee.

“Holder” means any Person in whose name any Capital
Securities are registered on the books and records of the Issuer; provided,
however, that, in determining whether the 

 2
 

holders of the requisite
percentage of Capital Securities have given any request, notice, consent or
waiver hereunder, “Holder” shall not include the Guarantor or any Affiliate of
the Guarantor.

“Indemnified Person” means the Guarantee Trustee
(including in its individual capacity), any Affiliate of the Guarantee Trustee,
or any officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Guarantee Trustee.

“Indenture” means the Indenture, dated as of June 28,
2007, between the Debenture Issuer and Wilmington Trust Company, not in its
individual capacity but solely as trustee, and any indenture supplemental
thereto pursuant to which the Debentures are to be issued to the Institutional
Trustee of the Issuer.

“Liquidation Distribution” has the meaning set forth
in the definition of “Guarantee Payments” herein.

“Majority in liquidation amount of the Capital
Securities” means Holder(s) of outstanding Capital Securities, voting together
as a class, but separately from the holders of Common Securities, of more than
50% of the aggregate liquidation amount (including the amount that would be
paid upon the redemption, liquidation or otherwise on the date upon which the
voting percentages are determined, plus unpaid Distributions accrued thereon to
such date) of all Capital Securities then outstanding.

“Obligations” means any costs, expenses or liabilities
(but not including liabilities related to taxes) of the Issuer, other than
obligations of the Issuer to pay to holders of any Trust Securities the amounts
due such holders pursuant to the terms of the Trust Securities.

“Officer’s Certificate” means, with respect to any
Person, a certificate signed by one Authorized Officer of such Person.  Any Officer’s Certificate delivered with respect
to compliance with a condition or covenant provided for in this Guarantee shall
include:

(a)                                  a
statement that such officer signing the Officer’s 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 such officer in rendering the Officer’s Certificate;

(c)                                  a
statement that 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 such officer, such condition or
covenant has been complied with.

“Person” means a legal person, including any
individual, corporation, estate, partnership, joint venture, association, joint
stock company, limited liability company, trust, 

 3
 

unincorporated
association, or government or any agency or political subdivision thereof, or
any other entity of whatever nature.

“Responsible Officer” means, with respect to the
Guarantee Trustee, any officer within the Corporate Trust Office of the
Guarantee Trustee with direct responsibility for the administration of any
matters relating to this Guarantee, including any vice president, any assistant
vice president, any secretary, any assistant secretary, the treasurer, any
assistant treasurer, any trust officer or other officer of the Corporate Trust
Office of the Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer’s knowledge of and familiarity with
the particular subject.

“Successor Guarantee Trustee” means a successor
Guarantee Trustee possessing the qualifications to act as Guarantee Trustee
under Section 3.1.

“Trust Securities”
means the Common Securities and the Capital Securities.

ARTICLE II

POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE

SECTION 2.1                          Powers
and Duties of the Guarantee Trustee.

(a)                                  This
Guarantee shall be held by the Guarantee Trustee for the benefit of the Holders
of the Capital Securities, and the Guarantee Trustee shall not transfer this
Guarantee to any Person except a Holder of Capital Securities exercising his or
her rights pursuant to Section 4.4 (b) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as Successor
Guarantee Trustee.  The right, title and
interest of the Guarantee Trustee shall automatically vest in any Successor
Guarantee Trustee, and such vesting and cessation of title shall be effective
whether or not conveyancing documents have been executed and delivered pursuant
to the appointment of such Successor Guarantee Trustee.

(b)                                 If
an Event of Default actually known to a Responsible Officer of the Guarantee
Trustee has occurred and is continuing, the Guarantee Trustee shall enforce
this Guarantee for the benefit of the Holders of the Capital Securities.

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

 4
 

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

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

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

(B)                                in
the absence of bad faith on the part of the Guarantee Trustee, the Guarantee
Trustee may 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 Guarantee Trustee and conforming to the requirements
of this Guarantee; but in the case of any such certificates or opinions
furnished to the Guarantee Trustee, the Guarantee Trustee shall be under a duty
to examine the same to determine whether or not on their face they conform to
the requirements of this Guarantee;

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

(iii)                               the
Guarantee 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 written
direction of the Holders of a Majority in liquidation amount of the Capital
Securities relating to the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee, or exercising any trust or
power conferred upon the Guarantee Trustee under this Guarantee; and

(iv)                              no
provision of this Guarantee shall require the Guarantee 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 the Guarantee Trustee shall have reasonable grounds for believing
that the repayment of such funds is not reasonably assured to it under the
terms of this Guarantee, or security and indemnity, reasonably satisfactory to
the Guarantee Trustee, against such risk or liability is not reasonably assured
to it.

SECTION 2.2                          Certain
Rights of the Guarantee Trustee.

(a)                                  Subject
to the provisions of Section 2.1:

 5
 

(i)                                     The
Guarantee Trustee may conclusively rely, and shall be fully protected in acting
or refraining from acting upon, any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed, sent or presented by the
proper party or parties.

(ii)                                  Any
direction or act of the Guarantor contemplated by this Guarantee shall be
sufficiently evidenced by an Officer’s Certificate.

(iii)                               Whenever,
in the administration of this Guarantee, the Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its part,
request and conclusively rely upon an Officer’s Certificate of the Guarantor
which, upon receipt of such request, shall be promptly delivered by the
Guarantor.

(iv)                              The
Guarantee Trustee shall have no duty to see to any recording, filing or
registration of any instrument or other writing (or any rerecording, refiling
or reregistration thereof).

(v)                                 The
Guarantee Trustee may consult with counsel of its selection, and the advice or
opinion of such counsel with respect to legal matters 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 accordance with such advice or
opinion.  Such counsel may be counsel to
the Guarantor or any of its Affiliates and may include any of its
employees.  The Guarantee Trustee shall
have the right at any time to seek instructions concerning the administration
of this Guarantee from any court of competent jurisdiction.

(vi)                              The
Guarantee Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Guarantee at the request or direction of any
Holder, unless such Holder shall have provided to the Guarantee Trustee such
security and indemnity, reasonably satisfactory to the Guarantee Trustee,
against the costs, expenses (including attorneys’ fees and expenses and the
expenses of the Guarantee Trustee’s agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Guarantee Trustee; provided, however, that nothing contained in this Section
2.2(a)(vi) shall be taken to relieve the Guarantee Trustee, upon the occurrence
of an Event of Default, of its obligation to exercise the rights and powers
vested in it by this Guarantee.

(vii)                           The
Guarantee 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, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit.

 6
 

(viii)                        The
Guarantee Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents, nominees,
custodians or attorneys, and the Guarantee 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.

(ix)                                Any
action taken by the Guarantee Trustee or its agents hereunder shall bind the
Holders of the Capital Securities, and the signature of the Guarantee Trustee
or its agents alone shall be sufficient and effective to perform any such
action.  No third party shall be required
to inquire as to the authority of the Guarantee Trustee to so act or as to its
compliance with any of the terms and provisions of this Guarantee, both of
which shall be conclusively evidenced by the Guarantee Trustee’s or its agent’s
taking such action.

(x)                                   Whenever
in the administration of this Guarantee the Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or right
or taking any other action hereunder, the Guarantee Trustee (A) may request
instructions from the Holders of a Majority in liquidation amount of the
Capital Securities, (B) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received and (C) shall be
protected in conclusively relying on or acting in accordance with such instructions.

(xi)                                The
Guarantee Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Guarantee.

(b)                                 No
provision of this Guarantee shall be deemed to impose any duty or obligation on
the Guarantee 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 Guarantee 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 Guarantee Trustee shall be construed to be a duty.

SECTION 2.3                          Not
Responsible for Recitals or Issuance of Guarantee.

The recitals contained in this Guarantee shall be
taken as the statements of the Guarantor, and the Guarantee Trustee does not
assume any responsibility for their correctness.  The Guarantee Trustee makes no representation
as to the validity or sufficiency of this Guarantee.

SECTION 2.4                          Events of Default; Waiver.

(a)                                  An
“Event of Default” under this Guarantee will occur upon the failure of the
Guarantor to perform any of its payment or other obligations hereunder.

(b)                                 The
Holders of a Majority in liquidation amount of the Capital Securities may,
voting or consenting as a class, on behalf of the Holders of all of the Capital
Securities, 

 7
 

waive any past Event of
Default and its consequences.  Upon such
waiver, any such Event of Default shall cease to exist, and shall be deemed to
have been cured, for every purpose of this Guarantee, but no such waiver shall
extend to any subsequent or other default or Event of Default or impair any
right consequent thereon.

SECTION 2.5                          Events of Default; Notice.

(a)                                  The
Guarantee Trustee shall, within 90 days after the occurrence of an Event of
Default, transmit by mail, first class postage prepaid, to the Holders of the
Capital Securities, notices of all Events of Default actually known to a
Responsible Officer of the Guarantee Trustee, unless such defaults have been
cured before the giving of such notice, provided, however, that the Guarantee
Trustee shall be protected in withholding such notice if and so long as a
Responsible Officer of the Guarantee Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of the Capital
Securities.

(b)                                 The
Guarantee Trustee shall not be charged with knowledge of any Event of Default
unless the Guarantee Trustee shall have received written notice thereof from
the Guarantor or a Holder of the Capital Securities, or a Responsible Officer
of the Guarantee Trustee charged with the administration of this Guarantee
shall have actual knowledge thereof.

ARTICLE III

THE GUARANTEE TRUSTEE

SECTION 3.1                          The Guarantee Trustee;
Eligibility.

(a)                                  There
shall at all times be a Guarantee Trustee which shall:

(i)                                     not
be an Affiliate of the Guarantor; and

(ii)                                  be
a corporation or national association organized and doing business under the
laws of the United States of America or any state thereof or of the District of
Columbia, or Person authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least 50 million U.S.
dollars ($50,000,000), and subject to supervision or examination by federal,
state or District of Columbia authority. 
If such corporation or national association publishes reports of
condition at least annually, pursuant to law or to the requirements of the
supervising or examining authority referred to above, then, for the purposes of
this Section 3.1(a)(ii), the combined capital and surplus of such corporation
or national association shall be deemed to be its combined capital and surplus
as set forth in its most recent report of condition so published.

(b)                                 If
at any time the Guarantee Trustee shall cease to be eligible to so act under
Section 3.1(a), the Guarantee Trustee shall immediately resign in the manner
and with the effect set forth in Section 3.2(c).

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

 8
 

SECTION 3.2                          Appointment, Removal and
Resignation of the Guarantee Trustee.

(a)                                  Subject
to Section 3.2(b), the Guarantee Trustee may be appointed or removed without
cause at any time by the Guarantor except during an Event of Default.

(b)                                 The
Guarantee Trustee shall not be removed in accordance with Section 3.2(a) until
a Successor Guarantee Trustee has been appointed and has accepted such
appointment by written instrument executed by such Successor Guarantee Trustee
and delivered to the Guarantor.

(c)                                  The
Guarantee Trustee appointed to office shall hold office until a Successor
Guarantee Trustee shall have been appointed or until its removal or
resignation.  The Guarantee Trustee may
resign from office (without need for prior or subsequent accounting) by an
instrument in writing executed by the Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Guarantee
Trustee has been appointed and has accepted such appointment by an instrument
in writing executed by such Successor Guarantee Trustee and delivered to the
Guarantor and the resigning Guarantee Trustee.

(d)                                 If
no Successor Guarantee Trustee shall have been appointed and accepted
appointment as provided in this Section 3.2 within 60 days after delivery of an
instrument of removal or resignation, the Guarantee Trustee resigning or being
removed may petition any court of competent jurisdiction for appointment of a Successor
Guarantee Trustee.  Such court may
thereupon, after prescribing such notice, if any, as it may deem proper,
appoint a Successor Guarantee Trustee.

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

(f)                                    Upon
termination of this Guarantee or removal or resignation of the Guarantee
Trustee pursuant to this Section 3.2, the Guarantor shall pay to the Guarantee
Trustee all amounts owing to the Guarantee Trustee under Sections 7.2 and 7.3
accrued to the date of such termination, removal or resignation.

ARTICLE IV

GUARANTEE

SECTION 4.1                          Guarantee.

(a)                                  The
Guarantor irrevocably and unconditionally agrees to pay in full to the Holders
the Guarantee Payments (without duplication of amounts theretofore paid by the
Issuer), as and when due, regardless of any defense (except defense of payment
by the Issuer), right of set-off or counterclaim that the Issuer may have or
assert.  The Guarantor’s obligation to
make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or by causing the Issuer to pay such
amounts to the Holders.

 9
 

(b)                                 The
Guarantor hereby also agrees to assume any and all Obligations of the Issuer
and in the event any such Obligation is not so assumed, subject to the terms
and conditions hereof, the Guarantor hereby irrevocably and unconditionally
guarantees to each Beneficiary the full payment, when and as due, of any and
all Obligations to such Beneficiaries. 
This Guarantee is intended to be for the Beneficiaries who have received
notice hereof.

SECTION 4.2                          Waiver
of Notice and Demand.

The Guarantor hereby waives notice of acceptance of
this Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.

SECTION 4.3                          Obligations
Not Affected.

The obligations, covenants, agreements and duties of
the Guarantor under this Guarantee shall in no way be affected or impaired by
reason of the happening from time to time of any of the following:

(a)                                  the
release or waiver, by operation of law or otherwise, of the performance or
observance by the Issuer of any express or implied agreement, covenant, term or
condition relating to the Capital Securities to be performed or observed by the
Issuer;

(b)                                 the
extension of time for the payment by the Issuer of all or any portion of the
Distributions, the price payable upon the redemption of the Capital Securities,
the Liquidation Distribution or any other sums payable under the terms of the
Capital Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Capital Securities
(other than an extension of time for the payment of the Distributions, the
price payable upon the redemption of the Capital Securities, the Liquidation
Distribution or other sums payable that results from the extension of any
interest payment period on the Debentures);

(c)                                  any
failure, omission, delay or lack of diligence on the part of the Holders to
enforce, assert or exercise any right, privilege, power or remedy conferred on
the Holders pursuant to the terms of the Capital Securities, or any action on
the part of the Issuer granting indulgence or extension of any kind;

(d)                                 the
voluntary or involuntary liquidation, dissolution, sale of any collateral,
receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other
similar proceedings affecting, the Issuer or any of the assets of the Issuer;

(e)                                  any
invalidity of, or defect or deficiency in, the Capital Securities;

(f)                                    the
settlement or compromise of any obligation guaranteed hereby or hereby
incurred; or

 10

(g)                                 any
other circumstance whatsoever that might otherwise constitute a legal or
equitable discharge or defense of a guarantor, it being the intent of this
Section 4.3 that the obligations of the Guarantor hereunder shall be absolute
and unconditional under any and all circumstances.

There shall be no obligation of the Holders to give
notice to, or obtain consent of, the Guarantor with respect to the happening of
any of the foregoing.

SECTION 4.4                          Rights
of Holders.

(a)                                  The
Holders of a Majority in liquidation amount of the Capital Securities have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Guarantee Trustee in respect of this Guarantee or to
direct the exercise of any trust or power conferred upon the Guarantee Trustee
under this Guarantee; provided, however, that (subject to Sections 2.1 and 2.2)
the Guarantee Trustee shall have the right to decline to follow any such
direction if the Guarantee Trustee shall determine that the actions so directed
would be unjustly prejudicial to the Holders not taking part in such direction
or if the Guarantee Trustee being advised by legal counsel determines that the
action or proceeding so directed may not lawfully be taken or if the Guarantee
Trustee in good faith by its board of directors or trustees, executive
committee or a trust committee of directors or trustees and/or Responsible
Officers shall determine that the action or proceeding so directed would
involve the Guarantee Trustee in personal liability.

(b)                                 Any
Holder of Capital Securities may institute a legal proceeding directly against
the Guarantor to enforce the Guarantee Trustee’s rights under this Guarantee,
without first instituting a legal proceeding against the Issuer, the Guarantee
Trustee or any other Person.  The
Guarantor waives any right or remedy to require that any such action be brought
first against the Issuer, the Guarantee Trustee or any other Person before so
proceeding directly against the Guarantor.

SECTION 4.5                          Guarantee
of Payment.

This Guarantee creates a guarantee of payment and not
of collection.

SECTION 4.6                          Subrogation.

The Guarantor shall be subrogated to all (if any)
rights of the Holders of Capital Securities against the Issuer in respect of
any amounts paid to such Holders by the Guarantor under this Guarantee;
provided, however, that the Guarantor shall not (except to the extent required
by applicable provisions of law) be entitled to enforce or exercise any right
that it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Guarantee, if,
after giving effect to any such payment, any amounts are due and unpaid under
this Guarantee.  If any amount shall be
paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.

 11
 

SECTION 4.7                          Independent
Obligations.

The Guarantor acknowledges that its obligations
hereunder are independent of the obligations of the Issuer with respect to the
Capital Securities and that the Guarantor shall be liable as principal and as
debtor hereunder to make Guarantee Payments pursuant to the terms of this
Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 4.3 hereof.

SECTION 4.8                          Enforcement.

A Beneficiary may enforce the Obligations of the
Guarantor contained in Section 4.1(b) directly against the Guarantor, and the
Guarantor waives any right or remedy to require that any action be brought
against the Issuer or any other person or entity before proceeding against the
Guarantor.

The Guarantor shall be subrogated to all rights (if
any) of any Beneficiary against the Issuer in respect of any amounts paid to the
Beneficiaries by the Guarantor under this Guarantee; provided, however, that
the Guarantor shall not (except to the extent required by applicable provisions
of law) be entitled to enforce or exercise any rights that it may acquire by
way of subrogation or any indemnity, reimbursement or other agreement, in all
cases as a result of payment under this Guarantee, if, after giving effect to
such payment, any amounts are due and unpaid under this Guarantee.  If any amount shall be paid to the Guarantor
in violation of the preceding sentence, the Guarantor agrees to hold such
amount in trust for the Beneficiaries and to pay over such amount to the
Beneficiaries.

ARTICLE V

LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 5.1                          Limitation
of Transactions.

So long as any Capital Securities remain outstanding,
if (a) there shall have occurred and be continuing an Event of Default or (b)
Debenture Issuer shall have selected an Extension Period as provided in the
Indenture and such period, or any extension thereof, shall have commenced and
be continuing, then the Guarantor may not (x) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Guarantor’s capital stock, (y) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Guarantor that rank in all respects pari passu with or junior in interest to the Debentures or
(z) make any payment under any guarantees of the Guarantor that rank in all
respects pari passu with or junior in interest to
this Guarantee (other than (i) repurchases, redemptions or other acquisitions
of shares of capital stock of the Guarantor (A) in connection with any
employment contract, benefit plan or other similar arrangement with or for the
benefit of one or more employees, officers, directors, or consultants, (B) in
connection with a dividend reinvestment or stockholder stock purchase plan or
(C) in connection with the issuance of capital stock of the Guarantor (or
securities convertible into or exercisable for such capital stock), as
consideration in an acquisition transaction entered into prior to the
occurrence of the Event of Default or the

 12
 

applicable Extension
Period, (ii) as a result of any exchange or conversion of any class or series
of the Guarantor’s capital stock (or any capital stock of a subsidiary of the
Guarantor) for any class or series of the Guarantor’s capital stock or of any
class or series of the Guarantor’s indebtedness for any class or series of the
Guarantor’s capital stock, (iii) the purchase of fractional interests in shares
of the Guarantor’s capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged, (iv)
any declaration of a dividend in connection with any stockholder’s rights plan,
or the issuance of rights, stock or other property under any stockholder’s
rights plan, or the redemption or repurchase of rights pursuant thereto, or (v)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior in interest to
such stock).

SECTION 5.2                          Ranking.

This Guarantee will constitute an unsecured obligation
of the Guarantor and will rank subordinate and junior in right of payment to
all present and future Senior Indebtedness (as defined in the Indenture) of the
Guarantor.  By their acceptance thereof,
each Holder of Capital Securities agrees to the foregoing provisions of this
Guarantee and the other terms set forth herein.

ARTICLE VI

TERMINATION

SECTION 6.1                          Termination.

This Guarantee shall terminate as to the Capital
Securities (i) upon full payment of the price payable upon redemption of all
Capital Securities then outstanding, (ii) upon the distribution of all of the
Debentures to the Holders of all of the Capital Securities or (iii) upon full
payment of the amounts payable in accordance with the Declaration upon
dissolution of the Issuer.  This
Guarantee will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder of Capital Securities must restore payment of any
sums paid under the Capital Securities or under this Guarantee.

ARTICLE VII

INDEMNIFICATION

SECTION 7.1                          Exculpation.

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

 13
 

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

SECTION 7.2                          Indemnification.

(a)                                  The
Guarantor agrees to indemnify each Indemnified Person for, and to hold each
Indemnified Person harmless against, any and all loss, liability, damage, claim
or expense incurred without negligence, willful misconduct or bad faith on the
part of the Indemnified Person, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including but
not limited to the costs and expenses (including reasonable legal fees and
expenses) of the Indemnified Person defending itself against, or investigating,
any claim or liability in connection with the exercise or performance of any of
the Indemnified Person’s powers or duties hereunder.  The obligation to indemnify as set forth in
this Section 7.2 shall survive the resignation or removal of the Guarantee
Trustee and the termination of this Guarantee.

(b)                                 Promptly
after receipt by an Indemnified Person under this Section 7.2 of notice of the
commencement of any action, such Indemnified Person will, if a claim in respect
thereof is to be made against the Guarantor under this Section 7.2, notify the
Guarantor in writing of the commencement thereof; but the failure so to notify
the Guarantor (i) will not relieve the Guarantor from liability under paragraph
(a) above unless and to the extent that the Guarantor did not otherwise learn
of such action and such failure results in the forfeiture by the Guarantor of
substantial rights and defenses and (ii) will not, in any event, relieve the
Guarantor from any obligations to any Indemnified Person other than the
indemnification obligation provided in paragraph (a) above.  The Guarantor shall be entitled to appoint
counsel of the Guarantor’s choice at the Guarantor’s expense to represent the
Indemnified Person in any action for which indemnification is sought (in which
case the Guarantor shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the Indemnified Person or Persons
except as set forth below); provided, however, that such counsel shall be
satisfactory to the Indemnified Person. 
Notwithstanding the Guarantor’s election to appoint counsel to represent
the Indemnified Person in any action, the Indemnified Person shall have the
right to employ separate counsel (including local counsel), and the Guarantor
shall bear the reasonable fees, costs and expenses of such separate counsel, if
(i) the use of counsel chosen by the Guarantor to represent the Indemnified
Person would present such counsel with a conflict of interest, (ii) the actual
or potential defendants in, or targets of, any such action include both the
Indemnified Person and the Guarantor and the Indemnified Person shall have
reasonably concluded that there may be legal defenses available to it and/or
other Indemnified Persons

 14
 

which are
different from or additional to those available to the Guarantor, (iii) the
Guarantor shall not have employed counsel satisfactory to the Indemnified
Person to represent the Indemnified Person within a reasonable time after notice
of the institution of such action or (iv) the Guarantor shall authorize the
Indemnified Person to employ separate counsel at the expense of the
Guarantor.  The Guarantor will not,
without the prior written consent of the Indemnified Persons, settle or compromise
or consent to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
Indemnified Persons are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each Indemnified Person from all liability arising out of such claim,
action, suit or proceeding.

SECTION 7.3                          Compensation;
Reimbursement of Expenses.

The Guarantor agrees:

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

(b)                                 except
as otherwise expressly provided herein, to reimburse the Guarantee Trustee upon
request for all reasonable expenses, disbursements and advances incurred or
made by it in accordance with any provision of this Guarantee (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 the negligence, willful misconduct or bad faith of the
Guarantee Trustee.

The provisions of this Section 7.3 shall survive the
resignation or removal of the Guarantee Trustee and the termination of this
Guarantee.

ARTICLE VIII

MISCELLANEOUS

SECTION 8.1                          Successors
and Assigns.

All guarantees and agreements contained in this
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Capital Securities then outstanding. 
Except in connection with any merger or consolidation of the Guarantor
with or into another entity or any sale, transfer or lease of the Guarantor’s
assets to another entity, in each case to the extent permitted under the
Indenture, the Guarantor may not assign its rights or delegate its obligations
under this Guarantee without the prior approval of the Holders of a Majority in
liquidation amount of the Capital Securities.

 15
 

SECTION 8.2                          Amendments.

Except with respect to any changes that do not
adversely affect the powers, preferences, rights or interests of Holders of the
Capital Securities in any material respect (in which case no approval of
Holders will be required), this Guarantee may be amended only with the prior
approval of the Holders of a Majority in liquidation amount of the Capital
Securities.  The provisions of the
Declaration with respect to amendments thereof shall apply equally with respect
to amendments of the Guarantee.

SECTION 8.3                          Notices.

All notices provided for in this Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by first class mail, as follows:

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

(b)                                 if
given to the Guarantor, at the Guarantor’s mailing address set forth below (or
such other address as the Guarantor may give notice of to the Holders of the
Capital Securities and to the Guarantee Trustee): 1st Pacific Bancorp, 4275
Executive Square, Suite 650, La Jolla, California 92037, Attention: Shelly
Hicks, Telecopy: 858-875-2020, Telephone: 858-875-2009; or

(c)                                  if
given to any Holder of the Capital Securities, at the address set forth on the
books and records of the Issuer.

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

SECTION 8.4                          Benefit.

This Guarantee is solely for the benefit of the
Holders of the Capital Securities and, subject to Section 2.1(a), is not
separately transferable from the Capital Securities.

SECTION 8.5                          Governing
Law.

THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT
OF LAW PRINCIPLES OF SAID STATE OTHER THAN SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW.

 16
 

SECTION 8.6                          Counterparts.

This Guarantee may contain more than one counterpart
of the signature page and this Guarantee may be executed by the affixing of the
signature of the Guarantor and the Guarantee Trustee to any of such counterpart
signature pages.  All of such counterpart
signature pages shall be read as though one, and they shall have the same force
and effect as though all of the signers had signed a single signature page.

 17
 

THIS GUARANTEE is executed as of the day and year
first above written.

	
  

  	
  1ST PACIFIC BANCORP,

  	
   

  
	
   

  	
  as Guarantor

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James H.
  Burgess

  	
   

  
	
   

  	
   

  	
  Name: James H.
  Burgess

  
	
   

  	
   

  	
  Title: EVP Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WILMINGTON TRUST
  COMPANY,

  
	
   

  	
  as Guarantee
  Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Thomas
  Morris II

  	
   

  
	
   

  	
   

  	
  Name: W. Thomas
  Morris II

  
	
   

  	
   

  	
  Title: Assistant
  Vice President

  
					

 

 18

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