S-3ASR

As filed with the Securities and Exchange Commission on June 19, 2012

Registration No. 333-            

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-3

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

POPULAR, INC.

(Exact Name of Registrant as Specified in Its Charter)

Puerto Rico

(State or Other Jurisdiction of Incorporation or Organization)

66-0667416

(I.R.S. Employer Identification No.)

POPULAR NORTH AMERICA, INC.

Delaware

(State or Other Jurisdiction of Incorporation or Organization)

66-0476353

(I.R.S. Employer Identification No.)

POPULAR CAPITAL TRUST IV

POPULAR NORTH AMERICA CAPITAL TRUST II

POPULAR NORTH AMERICA CAPITAL TRUST III

(Exact Name of Registrants as Specified in their Charter)

Delaware

(State or Other Jurisdiction of Incorporation or Organization)

66-6031656

60-6031653

60-6031652

(I.R.S. Employer Identification No.)

Popular Center Building

209 Muñoz Rivera Avenue

Hato Rey, Puerto Rico 00918

(787) 765-9800

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

Jorge A. Junquera

209 Muñoz Rivera Avenue

Hato Rey, Puerto Rico 00918

(787) 765-9800

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Ignacio Alvarez, Esq. Jorge A. Rivera, Esq. Popular, Inc. 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico 00918 Donald J. Toumey, Esq. Robert W. Downes, Esq. Sullivan & Cromwell LLP 125 Broad Street New York, New York 10004

Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement.

If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box.  ¨

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box.  x

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box.  x

If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x		Accelerated filer	¨
Non-accelerated filer	¨	(Do not check if a smaller reporting company)	Smaller reporting company	¨

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered	Amount to be registered/ Proposed maximum offering price per unit/ Proposed maximum offering price(1)(2)	Amount of registration  fee(3)
Senior Debt Securities
Subordinated Debt Securities
Junior Subordinated Debt Securities
Preferred Stock
Common Stock, par value $0.01 per share
Capital Securities of: Popular Capital Trust IV Popular North America Capital Trust II Popular North America Capital Trust III
Guarantees of Debt Securities of Popular North America, Inc. by Popular, Inc.
Guarantees of Capital Securities of Popular Capital Trust IV by Popular, Inc. and certain back-up undertakings
Guarantees of Capital Securities of Popular North America Capital Trust II and Popular North America Capital Trust III by Popular North America, Inc. and Popular, Inc. and certain back-up undertakings
Warrants
Purchase Contracts
Depositary Shares(4)
Units(5)

⁽¹⁾  An indeterminate aggregate initial offering price or number of the securities of each identified class is being registered as may from time to time be offered at indeterminate prices. Separate consideration may or may not be received for securities that are issuable on exercise, conversion or exchange of other securities or that are issued in units or represented by depositary shares.

⁽²⁾ Includes an unspecified number of securities that may be offered by affiliates of the Registrants in market-making transactions.

⁽³⁾  In accordance with Rules 456(b) and 457(r) the Registrants are deferring payment of all of the registration fee due in connection with the securities offered hereby and the Registrants will pay “pay-as-you-go registration fees.”

⁽⁴⁾  Each depositary share will be issued under a deposit agreement, will represent an interest in a fractional share or multiple shares of preferred stock and will be evidenced by a depositary receipt.

⁽⁵⁾  Each unit will be issued under a unit agreement or indenture and will represent an interest in two or more debt securities, warrants, purchase contracts, shares of preferred stock, depository shares and capital securities, which may or may not be separable from one another.

POPULAR, INC.

Senior Debt Securities Subordinated Debt Securities Junior Subordinated Debt Securities Preferred Stock Common Stock Warrants Purchase Contracts Depositary Shares Units of Popular, Inc. Senior Debt Securities Subordinated Debt Securities Junior Subordinated Debt Securities of Popular North America, Inc. Fully and unconditionally guaranteed as described herein by Popular, Inc. Capital Securities of Popular Capital Trust IV Fully and unconditionally guaranteed as described herein by Popular, Inc. Capital Securities of Popular North America Capital Trust II and Popular North America Capital Trust III Fully and unconditionally guaranteed as described herein by Popular North America, Inc. and Popular, Inc.

Popular, Inc. from time to time may offer to sell senior or subordinated debt securities, preferred stock, either separately or represented by depositary shares, common stock, warrants and purchase contracts, as well as units that include any of these securities or securities of other entities. The debt securities, preferred stock, warrants and purchase contracts may be convertible into or exercisable or exchangeable for common or preferred stock or other securities of Popular, Inc. or debt or equity securities of one or more other entities. Popular Inc.’s common stock is listed on the NASDAQ Global Select Market and trades under the ticker symbol “BPOP”.

Popular Capital Trust IV, Popular North America Capital Trust II and Popular North America Capital Trust III may offer and sell capital securities, in one or more offerings. Capital securities are preferred securities representing preferred beneficial interests in the applicable issuer trust.

These securities may be offered and sold to or through one or more underwriters, dealers and agents, including Popular Securities, Inc., a broker-dealer subsidiary of Popular, or directly to purchasers, on a continuous or delayed basis.

This prospectus describes some of the general terms that may apply to these securities. The specific terms of any securities to be offered and the specific manner in which they may be offered will be described in a supplement to this prospectus. This prospectus may not be used to sell securities unless accompanied by a prospectus supplement. Each prospectus supplement will indicate if the securities offered thereby will be listed on any securities exchange.

Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

These securities are not deposits or savings accounts but are unsecured obligations of Popular or of one of the trusts referred to above, and may involve investment risks, including possible loss of principal. These securities are not insured by the Federal Deposit Insurance Corporation or any other governmental agency or instrumentality.

Prospectus dated June 19, 2012

TABLE OF CONTENTS

	Page
ABOUT THIS PROSPECTUS		1
WHERE YOU CAN FIND MORE INFORMATION		2
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE		2
NOTE REGARDING FORWARD-LOOKING STATEMENTS AND CERTAIN RISKS		3
POPULAR, INC.		4
POPULAR NORTH AMERICA, INC.		5
POPULAR AND POPULAR NORTH AMERICA CAPITAL TRUSTS		5
RISK FACTORS		6
DESCRIPTION OF DEBT SECURITIES WE MAY OFFER		6
DESCRIPTION OF CAPITAL SECURITIES WE MAY OFFER		37
DESCRIPTION OF CAPITAL STOCK		53
USE OF PROCEEDS		56
RATIO OF INCOME TO FIXED CHARGES AND RATIO OF INCOME TO COMBINED FIXED CHARGES INCLUDING PREFERRED STOCK DIVIDENDS		56
VALIDITY OF THE SECURITIES		56
EXPERTS		56

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ABOUT THIS PROSPECTUS

This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, which we refer to as the “SEC,” using a shelf registration or continuous offering process. Under this shelf registration or continuous offering process, we or the trusts may sell any combination of the securities described in this prospectus in one or more offerings.

This prospectus gives you a general description of the securities that we or the trusts may offer. Each time we or the trusts sell securities, we or the trusts will provide a prospectus supplement containing specific information about the terms of the securities being offered. A prospectus supplement may include a discussion of any risk factors or other special considerations applicable to those securities or to us and may also include, if applicable, a discussion of material United States federal income tax considerations and considerations under the Employee Retirement Income Security Act of 1974, as amended, which we refer to as “ERISA.” A prospectus supplement may also add, update or change information in this prospectus. If there is any inconsistency between the information in this prospectus and the applicable prospectus supplement, you must rely on the information in the prospectus supplement. You should read both this prospectus and any prospectus supplement together with additional information described under “Where You Can Find More Information.”

The registration statement containing this prospectus, including exhibits to the registration statement, provides additional information about us and the securities offered under this prospectus. The registration statement can be read at the SEC’s web site or at the SEC’s public reference room described under “Where You Can Find More Information.”

When you acquire any securities discussed in this prospectus, you should rely only on the information provided in this prospectus and in the applicable prospectus supplement, including the information incorporated by reference herein and therein. Reference to a prospectus supplement means the prospectus supplement describing the specific terms of the securities you purchase. The terms used in your prospectus supplement will have the meanings described in this prospectus, unless otherwise specified. Neither we nor the trusts, nor any underwriters or agents whom we may from time to time retain, have authorized anyone to provide you with different information. Neither we nor the trusts are offering the securities in any jurisdiction where the offer is prohibited. You should not assume that the information in this prospectus, any prospectus supplement, or any document incorporated by reference, is truthful or complete at any date other than the date mentioned on the cover page of these documents.

We or the trusts may sell securities to underwriters who will sell the securities to the public on terms fixed at the time of sale. In addition, we or the trusts may sell the securities directly or through dealers or agents designated from time to time. If we or the trusts, directly or through agents, solicit offers to purchase the securities, we and the trusts reserve the sole right to accept and, together with any agents, to reject, in whole or in part, any of those offers. In addition, selling securityholders may sell the securities on terms described in the applicable prospectus supplement.

Any prospectus supplement will contain the names of the underwriters, dealers or agents, if any, together with the terms of offering, the compensation of those underwriters and the net proceeds to us. Any underwriters, dealers or agents participating in the offering may be deemed “underwriters” within the meaning of the Securities Act of 1933, as amended, which we refer to as the “Securities Act.”

References in this prospectus to the “Company,” “Popular,” “Popular, Inc.,” “we,” “us” or “our” refer to Popular, Inc. and its subsidiaries.

Unless otherwise stated, currency amounts in this prospectus and any prospectus supplement are stated in United States dollars, or “$.”

WHERE YOU CAN FIND MORE INFORMATION

We are required to file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any documents filed by us at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our filings with the SEC are also available to the public through the SEC’s Internet site at http://www.sec.gov.

We have filed with the SEC a registration statement on Form S-3 relating to the securities covered by this prospectus. This prospectus is a part of the registration statement and does not contain all the information in the registration statement. Whenever a reference is made in this prospectus to a contract or other document of Popular, the reference is only a summary and you should refer to the exhibits that are a part of the registration statement for a copy of the contract or other document. You may review a copy of the registration statement at the SEC’s public reference room in Washington, D.C., as well as through the SEC’s Internet site.

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

The SEC’s rules allow us to incorporate by reference information into this prospectus. This means that we can disclose important information to you by referring you to another document. Any information referred to in this way is considered part of this prospectus from the date we file that document. Any reports filed by us with the SEC after the date of this prospectus and before the date that the offering of the securities by means of this prospectus is terminated will automatically update and, where applicable, supersede any information contained in this prospectus or incorporated by reference in this prospectus.

We incorporate by reference into this prospectus the following documents or information filed with the SEC (other than, in each case, documents or information deemed to have been furnished and not filed in accordance with SEC rules):

(1) Annual Report on Form 10-K for the fiscal year ended December 31, 2011;

(2) Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012;

(3) Current Reports on Form 8-K filed on February 16, 2012, February 23, 2012, April 23, 2012, May 2, 2012, May 21, 2012 and May 30, 2012;

(4) Registration Statements filed pursuant to Section 12 of the Exchange Act and any amendments or reports filed for the purpose of updating such description.

All documents filed by the Company under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 on or after the date of this prospectus and before (1) the completion of the offering of the securities described in this prospectus and (2) the date any broker-dealer subsidiaries stop offering securities pursuant to the prospectus shall be incorporated by reference in this prospectus from the date of filing of such documents.

We will provide without charge to each person, including any beneficial owner, to whom this prospectus is delivered, upon his or her written request, a copy of any or all documents referred to above which have been or may be incorporated by reference into this prospectus excluding exhibits to those documents unless they are specifically incorporated by reference into those documents. You can request those documents from Enrique Martel, Corporate Communications, Popular, Inc., P.O. Box 362708, San Juan, Puerto Rico 009396-2708.

We have not included or incorporated by reference in this prospectus any separate financial statements of the trusts. We do not believe that these financial statements would provide holders of preferred securities with any important information for the following reasons:

• we will own all of the voting securities of the trusts;

• the trusts do not and will not have any independent operations other than to issue securities and to purchase and hold our debt securities; and

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• we are fully and unconditionally guaranteeing the obligations of the trusts as described in this prospectus.

We do not expect that the trusts will be required to file information with the SEC on an ongoing basis for as long as we continue to file our information with the SEC.

NOTE REGARDING FORWARD-LOOKING STATEMENTS AND CERTAIN RISKS

Certain statements in this prospectus are “forward-looking” statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements may relate to Popular’s financial condition, results of operations, plans, objectives, future performance and business, including, but not limited to, statements with respect to expected earnings levels, the adequacy of the allowance for loan losses, delinquency trends, market risk and the impact of interest rate changes, capital markets conditions, capital adequacy and liquidity, and the effect of legal proceedings and new accounting standards on Popular’s financial condition and results of operations. All statements contained herein that are not clearly historical in nature are forward-looking, and the words “anticipate,” “believe,” “continues,” “expect,” “estimate,” “intend,” “project” and similar expressions and future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may,” or similar expressions are generally intended to identify forward-looking statements.

These forward-looking statements involve certain risks, uncertainties, estimates and assumptions by management. Various factors, some of which are beyond Popular’s control, could cause actual results to differ materially from those contemplated by such forward-looking statements. Factors that might cause such a difference include, but are not limited to:

• the rate of growth in the economy and employment levels, as well as general business and economic conditions;

• changes in interest rates, as well as the magnitude of such changes;

• the fiscal and monetary policies of the federal government and its agencies;

• changes in federal bank regulatory and supervisory policies, including required levels of capital;

• the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) on our businesses, business practices and cost of operations;

• regulatory approvals that may be necessary to undertake certain actions or consummate strategic transactions such as acquisitions and dispositions;

• the relative strength or weakness of the consumer and commercial credit sectors and of the real estate markets in Puerto Rico and the other markets in which borrowers are located;

• the performance of the stock and bond markets;

• competition in the financial services industry;

• additional Federal Deposit Insurance Corporation (“FDIC”) assessments; and

• possible legislative, tax or regulatory changes.

Other possible events or factors that could cause results or performance to differ materially from those expressed in these forward-looking statements include the following: negative economic conditions that adversely affect the general economy, housing prices, the job market, consumer confidence and spending habits which may affect, among other things, the level of non-performing assets, charge-offs and provision expense; changes in interest rates and market liquidity which may reduce interest margins, impact funding sources and affect the ability to originate and distribute financial products in the primary and secondary markets; adverse

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movements and volatility in debt and equity capital markets; changes in market rates and prices which may adversely impact the value of financial assets and liabilities; liabilities resulting from litigation and regulatory investigations; changes in accounting standards, rules and interpretations; increased competition; our ability to grow our core businesses; decisions to downsize, sell or close units or otherwise change our business mix; and management’s ability to identify and manage these and other risks. Moreover, the outcome of legal proceedings we face is inherently uncertain and depends on judicial interpretations of law and the findings of regulators, judges and juries.

All forward-looking statements included in this prospectus are based upon information available to Popular as of the date of this document, and we assume no obligation to update or revise any such forward-looking statements.

POPULAR, INC.

Popular is a diversified, publicly-owned financial holding company, registered under the Bank Holding Company Act of 1956, as amended (the “BHC Act”), and subject to supervision and regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”). Headquartered in San Juan, Puerto Rico, Popular offers financial services in Puerto Rico, the mainland United States and the U.S. and British Virgin Islands. Popular also owns approximately a 49% interest in EVERTEC, which provides transaction processing services in the Caribbean and Latin America. As of March 31, 2012, Popular had approximately $37.0 billion in assets, $27.2 billion in deposits and $4.0 billion in stockholders’ equity. Our executive offices are located at 209 Muñoz Rivera Avenue, Hato Rey, Puerto Rico 00918, and our telephone number is (787) 765-9800.

Popular is a holding company and services its obligations primarily with dividends and advances that it receives from subsidiaries and from dividends received from certain of its equity method investments. Popular’s subsidiaries that operate in the banking business are required to obtain approval from the Federal Reserve System and their respective applicable state banking regulator prior to declaring or paying dividends to the Corporation. Furthermore, they can only pay dividends if they are in compliance with the applicable regulatory requirements imposed on them by federal and state bank regulatory authorities and regulators. Popular’s subsidiaries may be party to credit agreements that also may restrict their ability to pay dividends. Popular must also maintain required capital levels of a bank holding company before it may pay dividends on its stock.

Under the regulations of the Federal Reserve, a bank holding company is expected to act as a source of financial strength for its subsidiary banks. As a result of this regulatory policy, the Federal Reserve might require Popular to commit resources to its subsidiary banks when doing so is not otherwise in the interests of Popular or its shareholders or creditors.

Banco Popular De Puerto Rico

Our principal bank subsidiary, Banco Popular de Puerto Rico (“Banco Popular” or the “Bank”), was organized in 1893 and is Puerto Rico’s largest bank with consolidated total assets of $27.6 billion, deposits of $21.1 billion and stockholder’s equity of $2.7 billion at March 31, 2012. The Bank accounted for 75% of the total consolidated assets of the Company at March 31, 2012. Banco Popular has the largest retail franchise in Puerto Rico, with 176 branches and 612 automated teller machines, and has the largest trust operation in Puerto Rico. The Bank also operates eight branches in the U.S. Virgin Islands, one branch in the British Virgin Islands and one branch in New York. Banco Popular’s deposits are insured under the Deposit Insurance Fund (“DIF”) of the Federal Deposit Insurance Corporation (the “FDIC”). Banco Popular has two principal subsidiaries, Popular Auto, Inc., a vehicle and equipment financing, leasing and daily rental company, and Popular Mortgage, Inc., a mortgage loan company with 37 offices in Puerto Rico. In addition, Banco Popular has various subsidiaries holding specific assets acquired in satisfaction of loans for real estate development projects and commercial loans.

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Our Puerto Rico operations also include financial advisory, investment and securities brokerage services for institutional and retail customers through Popular Securities, Inc., a wholly-owned subsidiary of Popular, Inc. Popular Securities, Inc. is a securities broker-dealer with operations in Puerto Rico. As of March 31, 2012, Popular Securities had $354 million in total assets and $4.7 billion in assets under management.

We offer insurance and reinsurance services through Popular Insurance, Inc., a general insurance agency, and Popular Life RE, a reinsurance company, with total revenues of $26.6 million and $17.6 million, respectively, for the year ended December 31, 2011. We also own Popular Risk Services, Inc., an insurance broker, and Popular Insurance V.I., Inc., an insurance agency operating in the Virgin Islands.

POPULAR NORTH AMERICA, INC.

Popular North America, Inc. (“PNA”), a wholly owned subsidiary of Popular, Inc., was organized in 1991 under the laws of the State of Delaware and is a registered bank holding company under the BHC Act. PNA functions as a holding company for Popular, Inc.’s mainland U.S. operations. As of March 31, 2012, PNA had one principal subsidiary, Banco Popular North America (“BPNA”), a full service commercial bank incorporated in the State of New York that operates under the name Popular Community Bank.

In addition, BPNA owns all of the outstanding stock of E-LOAN, Popular Equipment Finance, Inc., and Popular Insurance Agency USA, Inc. E-LOAN’s business currently consists solely of providing an online platform to raise deposits for BPNA. At March 31, 2012, E-LOAN’s total assets amounted to $413 million. Popular Equipment Finance, Inc. sold a substantial portion of its lease financing portfolio during 2009 and also ceased originations as part of the BPNA restructuring plan implemented in late 2008. As a result of these initiatives, the total assets of Popular Equipment Finance, Inc. were reduced to $13 million at March 31, 2012. Popular Insurance Agency USA, Inc. acts as an insurance agent or broker for issuing insurance across the BPNA branch network. Total revenues of Popular Insurance Agency USA, Inc. for the year ended December 31, 2011 totaled $6.1 million.

Popular North America, Inc.’s principal executive offices are located at 209 Muñoz Rivera Avenue, San Juan, Puerto Rico 00918, and its telephone number is (787) 765-9800.

Condensed consolidated financial information of Popular, Inc. with separate columns for Popular, Inc., Popular North America, Inc., Popular International Bank, Inc., other subsidiaries of Popular, Inc. on a combined basis, consolidated adjustments and the total consolidated amounts are included in the notes to Popular, Inc.’s consolidated financial statements that are incorporated by reference.

POPULAR AND POPULAR NORTH AMERICA CAPITAL TRUSTS

Popular Capital Trust IV, Popular North America Capital Trust II and Popular North America Capital Trust III are statutory trusts formed under Delaware law by:

• the execution of a declaration of trust and trust agreement by Popular or Popular North America, as depositor, and certain of the trustees of the trusts, and

• the filing of a certificate of trust with the Secretary of State of the State of Delaware.

The capital securities offered hereby will constitute all of the capital securities of the trusts. Popular, or one of its affiliates, will acquire all of the common securities of the trusts.

Popular or one of its affiliates will pay all fees and expenses related to the trusts and the offering of the common securities and the capital securities.

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RISK FACTORS

Before investing in any securities offered thereby, you should consider carefully each of the risk factors set forth under “Risk Factors” in our most recently filed Annual Report on Form 10-K and our most recently filed Quarterly Report on Form 10-Q. See “Where You Can Find More Information” in this prospectus.

DESCRIPTION OF DEBT SECURITIES WE MAY OFFER

Information About Our Debt Securities

Two different issuers may offer debt securities using this prospectus: Popular, Inc. and Popular North America, Inc. In this section, we use “we” when referring to the issuers collectively and “the issuer” when referring to the particular company that issues a particular debt security or series of debt securities.

As required by U.S. federal law for all debt securities of companies that are publicly offered, the debt securities issued under this prospectus are governed by documents called indentures. The indentures are contracts between us and The Bank of New York Mellon, which currently acts as trustee under each of the indentures. The trustee has two main roles:

• First, the trustee can enforce your rights against us if we default. There are some limitations on the extent to which the trustee acts on your behalf, described below under “— Default and Remedies”; and

• Second, the trustee performs administrative duties for us, such as sending you interest payments, transferring your debt security to a new buyer if you sell and sending you notices.

The indentures permit us to issue different series of debt securities from time to time. We may issue debt securities in such amounts, at such times and on such terms as we wish. The debt securities will differ from one another in their terms.

Popular, Inc. may issue senior debt securities under an indenture dated as of February 15, 1995, as supplemented by the First Supplemental Indenture dated as of May 8, 1997 and as further supplemented by the Second Supplemental Indenture dated as of August 5, 1999 and the Third Supplemental Indenture dated as of September 10, 2008, in each case between Popular, Inc. and the trustee. Popular, Inc. may issue subordinated debt securities under an indenture dated as of November 30, 1995 between Popular, Inc. and the trustee. Popular North America, Inc. may issue senior debt securities under an indenture dated as of October 1, 1991, as supplemented by the First Supplemental Indenture dated as of February 28, 1995, the Second Supplemental Indenture dated as of May 8, 1997 and the Third Supplemental Indenture dated as of August 5, 1999, in each case among Popular, Inc., Popular North America, Inc. and the trustee. If Popular North America, Inc. issues subordinated debt securities, it will enter into an appropriate indenture with a trustee.

The indentures mentioned in the previous paragraph are referred to collectively as the indentures. The debt securities issued under the indentures referred to in the previous paragraph are referred to collectively as the debt securities. The senior debt securities of Popular, Inc. and Popular North America, Inc. are referred to collectively as the senior debt securities and the subordinated debt securities of Popular, Inc. and Popular North America, Inc. are referred to collectively as the subordinated debt securities. A copy or form of each indenture is filed as an exhibit to the registration statement relating to the debt securities.

Unless otherwise indicated in the applicable prospectus supplement, the covenants contained in the indentures and the debt securities will not afford holders of the debt securities protection in the event of a recapitalization, restructuring or other highly leveraged transaction.

This section summarizes the material terms that will apply generally to a series of debt securities. Each particular debt security will have financial and other terms specific to it, and the specific terms of each debt security will be described in a prospectus supplement attached to the front of this prospectus. Those terms may

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vary from the terms described here. As you read this section, therefore, please remember that the specific terms of your debt security as described in your prospectus supplement will supplement and, if applicable, may modify or replace the general terms described in this section. The statements we make in this section may not apply to your debt security.

Amounts That We May Issue

The indentures do not limit the aggregate amount of debt securities that we may issue, nor do they limit the aggregate amount of any particular series. The indentures and the debt securities do not limit our ability to incur other indebtedness or to issue other securities. This means that we may issue additional debt securities and other securities at any time without your consent and without notifying you. Also, we are not subject to financial or similar restrictions by the terms of the debt securities, except as described under “— Restrictive Covenants” below.

How the Debt Securities Rank Against Other Debt

Unless otherwise specified in the prospectus supplement, the debt securities will not be secured by any property or assets of the issuers. Thus, by owning a debt security, you are one of the unsecured creditors of the issuer of your debt security. The senior debt securities will not be subordinated to any of our other debt obligations. This means that in a bankruptcy or liquidation proceeding against the issuer, the senior debt securities would rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the issuer. The subordinated debt securities may be subordinated to any of our other debt obligations as described in “— Special Terms Relating to the Subordinated Debt Securities” below.

This Section Is Only a Summary

The indentures and their associated documents, including your debt security, contain the full legal text of the matters described in this section and your prospectus supplement. The indentures and the debt securities are governed by New York law. A copy of each indenture or form of indenture has been filed with the SEC as part of our registration statement.

Because this section and your prospectus supplement provide only a summary, they do not describe every aspect of the indentures and your debt security. This summary is subject to and qualified in its entirety by reference to all the provisions of the indentures, including definitions of certain terms used in the indentures. For example, in this section and your prospectus supplement, we use terms that have been given special meaning in the indentures. In this section, however, we describe the meaning for only the more important of those terms.

Features Common to All Debt Securities

Stated Maturity and Maturity

The day on which the principal amount of your debt security is scheduled to become due and payable is called the stated maturity of the principal and is specified in your prospectus supplement. The principal may become due sooner, by reason of redemption or acceleration after a default. The day on which the principal actually becomes due, whether at the stated maturity or earlier, is called the maturity of the principal.

We also use the terms “stated maturity” and “maturity” to refer to the dates when other payments become due. For example, we may refer to a regular interest payment date when an installment of interest is scheduled to become due as the “stated maturity” of that installment. When we refer to the “stated maturity” or the “maturity” of a debt security without specifying a particular payment, we mean the stated maturity or maturity, as the case may be, of the principal.

Currency of Debt Securities

Amounts that become due and payable on your debt security will be payable in a currency, composite currency or basket of currencies specified in your prospectus supplement.

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We call this currency, composite currency or basket of currencies a specified currency. The specified currency for your debt security will be U.S. dollars unless your prospectus supplement states otherwise. A specified currency may include the euro. Some debt securities may have different specified currencies for principal and interest.

You will have to pay for your debt securities by delivering the requisite amount of the specified currency for the principal to the dealer or dealers that we name in your prospectus supplement, unless other arrangements have been made between you and us or between you and that dealer or dealers. We will make payments on your debt securities in the specified currency, except as otherwise described in your prospectus supplement.

Types of Debt Securities

We may issue the following types of debt securities:

• Fixed Rate Debt Securities. A debt security of this type will bear interest at a fixed rate described in the applicable prospectus supplement. This type includes zero coupon debt securities, which bear no interest and are instead issued at a price lower than the principal amount.

• Floating Rate Debt Securities. A debt security of this type will bear interest at rates that are determined by reference to an interest rate formula. In some cases, the rates may also be adjusted by adding or subtracting a spread or multiplying by a spread multiplier and may be subject to a minimum rate or a maximum rate. If your debt security is a floating rate debt security, the formula and any adjustments that apply to the interest rate will be described in your prospectus supplement.

• Indexed Debt Securities. A debt security of this type provides that the principal amount payable at its maturity, and/or the amount of interest payable on an interest payment date, will be determined by reference to one or more currencies, commodities or stocks, including baskets of stocks and stock indices, or to any other index described in the applicable prospectus supplement. If you are a holder of an indexed debt security, you may receive a principal amount at maturity that is greater than or less than the face amount of your debt security depending upon the value of the applicable index at maturity. That value may fluctuate over time. Some indexed debt securities may also be exchangeable, at the option of the holder or the applicable issuer, into stock of an issuer other than the issuer of the indexed debt securities. If you purchase an indexed debt security, your prospectus supplement will include information about the relevant index and about how amounts that are to become payable will be determined by reference to that index. If you purchase a security exchangeable into stock of an issuer other than the issuer of the indexed debt securities, your prospectus supplement will include information about the issuer and may also tell you where additional information about the issuer is available.

A fixed rate debt security, a floating rate debt security or an indexed debt security may be an original issue discount debt security. A debt security of this type is issued at a price lower than its principal amount and provides that, upon redemption or acceleration of its maturity, an amount less than its principal amount will be payable. A debt security issued at a discount to its principal may, for U.S. federal income tax purposes, be considered an original issue discount debt security, regardless of the amount payable upon redemption or acceleration of maturity.

Information in your Prospectus Supplement

Your prospectus supplement will describe one or more of the following terms of your debt security:

• the issuer of the series of debt securities;

• the title of the series of debt securities;

• the stated maturity;

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• whether your debt security is a senior or subordinated debt security;

• the specified currency or currencies for principal and interest, if not U.S. dollars; and

• the price at which we originally issue your debt security, expressed as a percentage of the principal amount, and the original issue date.

If you purchase your note in a market-making transaction, you will receive information about the price you pay and your trade and settlement dates in a separate confirmation of sale. A market-making transaction is one in which Popular Securities, Inc. or another of our affiliates resells a note that it has previously acquired from another holder. A market-making transaction in a particular note occurs after the original issuance and sale of the note.

• whether your debt security is a fixed rate debt security, a floating rate debt security or an indexed debt security, and also whether it is an original issue discount debt security;

• if your debt security is a fixed rate debt security, the rate at which your debt security will bear interest, if any, the regular record dates and the interest payment dates;

• if your debt security is a floating rate debt security, the interest rate basis; any applicable index, currency or maturity, spread or spread multiplier or initial, maximum or minimum rate; the interest reset, determination, calculation and payment dates; and the calculation agent;

• if your debt security is an original issue discount debt security, the yield to maturity;

• if your debt security is an indexed debt security, the principal amount the issuer will pay you at maturity, the amount of interest, if any, the issuer will pay you on an interest payment date or the formula the issuer will use to calculate these amounts, if any, and whether your debt security will be exchangeable for or payable in stock of an issuer other than the issuer of the indexed debt security or other property;

• whether your debt security may be redeemed or repaid by the issuer at our or the holder’s option before the stated maturity and, if so, other relevant terms such as the redemption or repayment commencement date, specific redemption or repayment date(s), redemption or repayment period(s) and redemption or repayment price(s), all of which we describe under “— Redemption and Repayment” below;

• whether we will issue or make available your debt security in non-book-entry form;

• the denominations in which securities will be issued (if other than integral multiples of U.S. $1,000); and

• any other terms of your debt security that are consistent with the provisions of the indentures.

Legal Ownership of Securities

Please note that in this prospectus, the term “holders” means those who own securities registered in their own names on the books that we or the trustee maintain for this purpose and not those who own beneficial interests in securities registered in “street name” or in securities issued in book-entry form through The Depository Trust Company.

We refer to those who have securities registered in their own names, on the books that we or the trustee maintain for this purpose, as the holders of those securities. These persons are the legal holders of the securities. We refer to those who, indirectly through others, own beneficial interests in securities that are not registered in their own names as indirect owners of those securities. As we discuss below, indirect owners are not legal holders, and investors in securities issued in book-entry form, which we refer to as book-entry securities, or in street name will be indirect owners.

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Book-Entry Owners

Securities represented by one or more global securities are registered in the name of a financial institution that holds them as depositary on behalf of other financial institutions that participate in the depositary’s book-entry system. These participating institutions, in turn, hold beneficial interests in the securities on behalf of themselves or their customers.

Under the indentures, only the person in whose name a security is registered is recognized as the holder of that security. Consequently, for book-entry securities, we will recognize only the depositary as the holder of the securities, and we will make all payments on the securities to the depositary. The depositary passes along the payments it receives to its participants, which in turn pass the payments along to their customers who are the beneficial owners. The depositary and its participants make these payments under agreements they have made with one another or with their customers; they are not obligated to do so under the terms of the securities.

As a result, investors in global securities will not own debt securities directly. Instead, they will own beneficial interests in a global security, through a bank, broker or other financial institution that participates in the depositary’s book-entry system or holds an interest through a participant. As long as debt securities are issued in global form, investors will be indirect owners, and not holders, of the securities. More information regarding the depositary, participants and indirect owners is described below under “— Special Considerations for Global Debt Securities — Information Relating to DTC.”

Street Name Owners

We may terminate a global security or issue securities initially in non-global form. In these cases, investors may choose to hold their securities in their own names or in “street name.” Securities held by an investor in street name would be registered in the name of a bank, broker or other financial institution that the investor chooses, and the investor would hold only a beneficial interest in those securities through an account he or she maintains at that institution.

For securities held in street name, we will recognize only the intermediary banks, brokers and other financial institutions in whose names the securities are registered as the holders of those securities, and we will make all payments on those securities to them. These institutions pass along the payments they receive to their customers who are the beneficial owners, but only because they agree to do so in their customer agreements or because they are legally required to do so. Investors who hold securities in street name will be indirect owners, not holders, of those securities.

If you hold debt securities through a bank, broker or other financial institution, either in book-entry form or in street name, you should check with your own institution to find out:

• how it handles securities payments and notices;

• whether it imposes fees or charges;

• how it would handle a request for the holder’s consent, if ever required;

• whether and how you can instruct it to send you debt securities registered in your own name so you can be a holder, if that is permitted in the future;

• how it would exercise rights under the debt securities if there were a default or other event triggering the need for holders to act to protect their interests; and

• if the debt securities are in book-entry form, how the depositary’s rules and procedures will affect these matters.

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Legal Holders

Our obligations, as well as the obligations of the trustee and those of any third parties employed by us or the trustee, run only to the holders of securities. We do not have obligations to investors who hold beneficial interests in street name, in global securities or by any other indirect means. This will be the case whether an investor chooses to be an indirect owner of a security or has no choice because we issue the securities only in global form.

For example, once we make payment or give a notice to the holder, we have no further responsibility for that payment or notice even if that holder is required, under agreements with depositary participants or customers or by law, to pass it along to the indirect owners but does not do so. Similarly, if we want to obtain the approval of the holders for any purpose — e.g., to amend the indentures or to relieve us of the consequences of a default or of our obligation to comply with a particular provision of the indenture — we would seek the approval only from the holders, and not the indirect owners, of the securities. Whether and how the holders contact the indirect owners is up to the holders.

What is a Global Debt Security?

We may issue each debt security only in book-entry form. Each debt security issued in book-entry form will be represented by a global debt security that we will deposit with and register in the name of a financial institution, or its nominee, that we select. The financial institution that we select for this purpose is called the depositary. Unless we say otherwise in the applicable prospectus supplement, The Depository Trust Company, New York, New York, known as DTC, will be the depositary for all debt securities issued in book-entry form.

A global debt security may represent one or any other number of individual debt securities. Generally, all debt securities represented by the same global debt security will have the same terms. We may, however, issue a global debt security that represents multiple debt securities that have different terms and are issued at different times. We call this kind of global debt security a master global debt security.

A global debt security may not be transferred to or registered in the name of anyone other than the depositary or its nominee, unless special termination situations arise. We describe those situations below under “— Special Considerations for Global Debt Securities — Special Situations When a Global Debt Security Will Be Terminated.” As a result of these arrangements, the depositary, or its nominee, will be the sole registered owner and holder of all debt securities represented by a global debt security, and investors will be permitted to own only beneficial interests in a global debt security. Beneficial interests must be held by means of an account with a broker, bank or other financial institution that in turn has an account with the depositary or with another institution that does. Thus, an investor whose debt security is represented by a global debt security will not be a legal holder of the debt security, but only an indirect owner of a beneficial interest in the global debt security.

If the prospectus supplement for a particular debt security indicates that the debt security will be issued in “global form only,” then the debt security will be represented by a global debt security at all times unless and until the global debt security is terminated under one of the special situations described below under “— Special Considerations for Global Debt Securities — Special Situations When a Global Debt Security Will Be Terminated.” The global debt security may be a master global debt security, although your prospectus supplement will not indicate whether it is a master global debt security.

Special Considerations for Global Debt Securities

As an indirect owner, an investor’s rights relating to a global debt security will be governed by the account rules of the investor’s financial institution or any intermediary of the depositary, as well as general laws relating to securities transfers. We do not recognize this type of investor as a legal holder of debt securities and instead deal only with the depositary, or its nominee, that holds the global debt security.

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If debt securities are issued only in the form of a global debt security, an investor should be aware of the following:

• An investor cannot cause the debt securities registered in his or her own name and cannot get non-global certificates for his or her interest in the debt securities, except in the special situations we describe below;

• An investor will be an indirect owner and must look to his or her own bank or broker for payment deliveries on the debt securities and protection of his or her legal rights relating to the debt securities, as we describe under “— Legal Ownership of Securities” above;

• An investor may not be able to sell interests in the debt securities to some insurance companies and other institutions that are required by law to own their securities in non-book-entry form;

• An investor may not be able to pledge his or her interest in a global security in circumstances where certificates representing the securities must be delivered to the lender or other beneficiary of the pledge in order for the pledge to be effective;

• The depositary’s policies, which may change from time to time, will govern payments, transfers, exchanges and other matters relating to the investor’s interest in a global debt security. We and the trustee have no responsibility for any aspect of the depositary’s actions or for its records of ownership interests in a global debt security. We and the trustee also do not supervise the depositary in any way;

• The depositary may require that those who purchase and sell interests in a global debt security within its book-entry system use immediately available funds, and your broker or bank may require you to do so as well; and

• Financial institutions that participate in the depositary’s book-entry system, and through which an investor holds its interest in the global debt securities, may also have their own policies affecting payments, notices and other matters relating to the debt securities. There may be more than one financial intermediary in the chain of ownership for an investor. We do not monitor and are not responsible for the actions of any of those intermediaries.

Information Relating to DTC

DTC will act as securities depository for the book-entry securities. The book-entry securities will be issued as fully registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully registered global debt security will be issued for each issue of book-entry securities, each in the aggregate principal amount of that issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one global debt security will be issued with respect to each $500 million of principal amount and an additional global debt security will be issued with respect to any remaining principal amount of that issue.

DTC has informed us that it is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds securities that DTC participants deposit with DTC. DTC also facilitates the post-trade settlement among DTC participants of sales and other securities transactions in deposited securities through electronic computerized book-entry transfers and pledges between DTC participants’ accounts. This eliminates the need for physical movement of securities certificates. DTC participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system

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is also available to others such as both U.S. and non-U.S. brokers and dealers, banks, trust companies and clearing corporations that clear through or maintain a custodial relationship with a DTC participant, either directly or indirectly. The rules applicable to DTC and DTC participants are on file with the SEC.

Purchases of securities within the DTC system must be made by or through DTC participants, which will receive a credit for the securities on DTC’s records. The ownership interest of each actual acquirer of new securities is in turn to be recorded on the direct and indirect participants’ records. Transfers of ownership interests in the securities are to be accomplished by entries made on the books of participants acting on behalf of beneficial owners.

Redemption notices will be sent to DTC’s nominee, Cede & Co., as the registered holder of the securities. If less than all of the securities within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each direct participant in such issue to be redeemed.

In instances in which a vote is required, neither DTC nor Cede & Co. will itself consent or vote with respect to the securities unless authorized by a direct participant in accordance with its procedures. Under its usual procedures, DTC mails an omnibus proxy to the relevant agent or depositary as soon as possible after the record date. The omnibus proxy assigns Cede & Co.’s consenting or voting rights to those direct participants to whose accounts such securities are credited on the record date (identified in a listing attached to the omnibus proxy).

Distribution payments on the securities will be made by the issuer, or the issuer’s relevant payment agent or the depositary for depositary shares, to Cede & Co., or such other nominee as requested by an authorized representative of DTC. DTC’s practice is to credit direct participants’ accounts upon DTC’s receipt of funds and corresponding information from the issuer or the relevant payment agent or depositary, on the relevant payment date in accordance with their respective holdings. Payments by DTC participants to beneficial owners will be governed by standing instructions and customary practices and will be the responsibility of such participants and not of DTC, the relevant payment agent or depositary for depository shares or us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of distributions to DTC is the responsibility of the relevant payment agent or depositary for depository shares, and disbursements of such payments to the beneficial owners are the responsibility of direct and indirect participants.

The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that we believe to be accurate, but we assume no responsibility for the accuracy thereof. We do not have any responsibility for the performance by DTC or its participants of their respective obligations as described herein or under the rules and procedures governing their respective operations.

Special Situations When a Global Debt Security Will Be Terminated

In a few special situations described below, a global debt security will be terminated and interests in it will be exchanged for certificates in non-global form representing the debt securities it represented. After that exchange, the choice of whether to hold the debt securities directly or in street name will be up to the investor. Investors must consult their own banks or brokers to find out how to have their interests in a global debt security transferred on termination to their own names, so that they will be legal holders. We have described the rights of holders and street name investors above under “— Legal Ownership of Securities.”

The special situations for termination of a global debt security are:

• when the depositary notifies us that it is unwilling, unable or no longer qualified to continue as depositary for that global debt security and we do not appoint another institution to act as depositary within 60 days;

• when we notify the trustee that we wish to terminate that global debt security; or

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• when an event of default has occurred with regard to debt securities represented by that global debt security and has not been cured or waived; we discuss defaults below under “— Default and Remedies.”

When a global debt security is terminated, only the depositary, and not we or the trustee, is responsible for deciding the names of the institutions in whose names the debt securities represented by the global debt security will be registered and, therefore, who will be the holders of those debt securities.

Notices

Notices to be given to holders of a global note will be given only to the depositary, in accordance with its applicable policies as in effect from time to time. Notices to be given to holders of notes not in global form will be sent by mail to the respective addresses of the holders as they appear in the trustee’s records, and will be deemed given when mailed. Neither the failure to give any notice to a particular holder, nor any defect in a notice given to a particular holder, will affect the sufficiency of any notice given to another holder.

IN THE REMAINDER OF THIS DESCRIPTION “YOU” MEANS DIRECT HOLDERS AND NOT BOOK ENTRY, STREET NAME OR OTHER INDIRECT OWNERS OF DEBT SECURITIES.

Form, Exchange, Registration and Transfer

Debt securities may be issued:

• only in fully registered form; and

• without interest coupons.

Holders may exchange their non-global debt securities for debt securities of smaller denominations or combined into fewer debt securities of larger denominations, as long as the total principal amount is not changed. This is called an “exchange.”

Holders may exchange or transfer their certificated debt securities at the office of the trustee. We will initially appoint the trustee to act as our agent for registering debt securities in the names of holders and transferring debt securities. We may appoint another entity to perform these functions or perform them ourselves. The entity performing the role of maintaining the list of registered holders is called the security registrar. It will also perform transfers.

Holders will not be required to pay a service charge to transfer or exchange their debt securities, but they may be required to pay for any tax or other governmental charge associated with the exchange or transfer. The transfer or exchange will be made only if our transfer agent is satisfied with the holder’s proof of legal ownership.

If we have designated additional transfer agents for your debt security, they will be named in your prospectus supplement. We may appoint additional transfer agents or cancel the appointment of any particular transfer agent. We may also approve a change in the office through which any transfer agent acts.

If any debt securities are redeemable and we redeem less than all those debt securities, we may prohibit the transfer or exchange of those debt securities during the period beginning 15 days before the day we mail the notice of redemption and ending on the day of that mailing, in order to freeze the list of holders to prepare the mailing. We may also refuse to register transfers or exchanges of any debt security selected for redemption, except that we will continue to permit transfers and exchanges of the unredeemed portion of any debt security being partially redeemed.

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If a debt security is issued as a global debt security, only the depositary will be entitled to transfer and exchange the debt security as described in this subsection because it will be the sole holder of the debt security.

Payment and Paying Agent

The issuer will only be required to make payment of the principal on a debt security if you surrender the debt security to the paying agent for that debt security. The issuer will only be required to make payment of principal and interest at the office of the paying agent, except that at its option, it may pay interest by mailing a check to the holder. Unless we indicate otherwise in the applicable prospectus supplement, the issuer will pay interest to the person who is the holder at the close of business on the record date for that interest payment, even if that person no longer owns the debt security on the interest payment date.

We will specify in the applicable prospectus supplement the regular record date relating to an interest payment date for any fixed rate debt security and for any floating rate debt security.

Payment When Offices Are Closed

If any payment is due on a debt security on a day that is not a business day, we will make the payment on the next day that is a business day. Payments postponed to the next business day in this situation will be treated under the indentures as if they were made on the original due date. Postponement of this kind will not result in a default under any debt security or indenture, and no interest will accrue on the postponed amount from the original due date to the next day that is a business day unless the applicable prospectus supplement specifies otherwise.

Paying Agent

We will specify the paying agent for payments with respect to debt securities of each series of debt securities in the applicable prospectus supplement. We may at any time designate additional paying agents, rescind the designation of any paying agent or approve a change in the office through which any paying agent acts, except that we must maintain a paying agent in each place of payment for each series of debt securities.

Unclaimed Payments

Regardless of who acts as paying agent, all money paid by us to a paying agent that remains unclaimed at the end of two years after the amount is due to a holder will be repaid to us. After that two-year period, the holder may look only to the issuer (or any guarantor) for payment and not to the trustee, any other paying agent or anyone else.

Prescription

Under New York’s statute of limitations, any legal action to enforce Popular’s payment obligations evidenced by the debt securities must be commenced within six years after payment is due. Thereafter Popular’s payment obligations will generally become unenforceable.

Redemption and Repayment

Unless otherwise indicated in your prospectus supplement, your debt security will not be entitled to the benefit of any sinking fund — that is, we will not deposit money on a regular basis into any separate custodial account to repay your debt securities. In addition, except as described below, we will not be entitled to redeem your debt security before its stated maturity unless your prospectus supplement specifies a redemption commencement date. You will not be entitled to require us to buy your debt security from you, before its stated maturity, unless your prospectus supplement specifies one or more repayment dates.

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If your prospectus supplement specifies a redemption commencement date or a repayment date, it will also specify one or more redemption prices or repayment prices, which will be expressed as a percentage of the principal amount of your debt security. It may also specify one or more redemption periods during which the redemption prices relating to a redemption of debt securities will apply.

If your prospectus supplement specifies a redemption commencement date, your debt security will be redeemable at our option at any time on or after that date. If we redeem your debt security, we will do so at the specified redemption price, together with interest accrued to the redemption date. If different prices are specified for different redemption periods, the price we pay will be the price that applies to the redemption period during which your debt security is redeemed.

If your prospectus supplement specifies a repayment date, your debt security will be repayable at your option on the specified repayment date at the specified repayment price, together with interest accrued to the repayment date.

In the event that we exercise an option to redeem any debt security, we will give to the trustee and the holder written notice of the principal amount of the debt security to be redeemed, not less than 30 days nor more than 60 days before the applicable redemption date. Notice of this redemption will be mailed to holders at the address that appears on the register of the redeemed debt securities.

If a debt security represented by a global debt security is repayable at the holder’s option, the depositary or its nominee, as the holder, will be the only person that can exercise the rights to repayment. Any indirect owners who own beneficial interests in the global debt security and wish to exercise a repayment right must give proper and timely instructions to their banks or brokers through which they hold their interests, requesting that they notify the depositary to exercise the repayment right on their behalf. Different firms have different deadlines for accepting instructions from their customers, and you should take care to act promptly enough to ensure that your request is given effect by the depositary before the applicable deadline for exercise.

Street name and other indirect owners should contact their banks or brokers for information about how to exercise a repayment right in a timely manner.

If the option of the holder to elect repayment as described above is deemed to be a “tender offer” within the meaning of Rule 14e-1 under the Securities Exchange Act of 1934, we will comply with Rule 14e-1 as then in effect to the extent applicable.

We or our affiliates may purchase debt securities from investors who are willing to sell from time to time, either in the open market at prevailing prices or in private transactions at negotiated prices. Debt securities that we or they purchase may, at our discretion, be held, resold or canceled.

A change in law, regulation or interpretation could oblige Popular, Inc. to pay the additional amounts that are discussed below under “— Taxation by the Commonwealth of Puerto Rico.” If this happens, we will have the option of redeeming or repaying an entire series of the debt securities at our discretion after giving between 30 and 60 days’ notice to the holders at a redemption price of 100% of the principal amount of the notes with the accrued interest to the redemption date, or another redemption price specified in the applicable prospectus supplement.

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Mergers and Similar Transactions

Each issuer is generally permitted to merge or consolidate with another entity. Each issuer is also permitted to sell its assets substantially as an entirety to another firm. An issuer may not take any of these actions, however, unless all the following conditions are met:

• If the successor firm in the transaction is not the applicable issuer, the successor firm must expressly assume that issuer’s obligations under the debt securities, the guarantees and the indentures.

• Immediately after the transaction, no default under the indentures or debt securities of that issuer has occurred and is continuing. For this purpose, “default under the indentures or debt securities” means an event of default or any event that would be an event of default if the requirements for giving us default notice and for the issuer’s default having to continue for a specific period of time were disregarded. We describe these matters below under “— Default and Remedies.”

These conditions will apply only if an issuer wishes to merge, consolidate or sell its assets substantially as an entirety. An issuer will not need to satisfy these conditions if it enters into other types of transactions, including any transaction in which it acquires the stock or assets of another firm, any transaction that involves a change of control of it but in which it does not merge or consolidate and any asset sale that does not constitute a sale of its assets substantially as an entirety.

The meaning of the phrase “substantially as an entirety” as used above will be interpreted in connection with the facts and circumstances of the subject transaction and is subject to judicial interpretation. Accordingly, in certain circumstances, there may be a degree of uncertainty in ascertaining whether a particular transaction would involve a disposition of the assets of the issuer substantially as an entirety.

Restrictive Covenants

In the senior indentures, Popular, Inc. promises not to sell, transfer or otherwise dispose of any voting stock of Banco Popular or permit Banco Popular to issue, sell or otherwise dispose of any of its voting stock, unless, after giving effect to the transaction, Banco Popular remains a controlled subsidiary (as defined below), except as provided above under “— Mergers and Similar Transactions.”

In addition, Popular, Inc. may not permit Banco Popular to:

• merge or consolidate, unless the survivor is a controlled subsidiary, or

• convey or transfer its properties and assets substantially as an entirety, except to a controlled subsidiary.

The senior indentures define “voting stock” as the stock of the class or classes having general voting power under ordinary circumstances to elect a majority of the board of directors, managers or trustees of a corporation. Stock that may vote only if an event occurs that is beyond the control of its holders is not considered voting stock under the senior indentures, whether or not the event has happened. “Controlled subsidiary” means any corporation of which an issuer owns more than 80% of the outstanding voting stock.

Popular, Inc. also promises in the senior indentures not to, nor to permit any material banking subsidiary to, create, incur or permit to exist any indebtedness for borrowed money secured by a lien or other encumbrance on the voting stock of any material banking subsidiary unless Popular, Inc.’s senior debt securities, Popular, Inc.’s Guarantees of Popular North America, Inc.’s senior debt securities and, at Popular, Inc.’s discretion, any other indebtedness with a right of payment equal to Popular, Inc.’s senior debt securities and Popular, Inc.’s guarantees of Popular North America, Inc.’s senior debt securities are secured on an equal basis. “Material banking subsidiary” means any controlled subsidiary chartered as a banking corporation under federal, state or Puerto Rico law that is a significant subsidiary of Popular, Inc. as defined in Rule 1-02 of Regulation S-X of the SEC. As of the date of this prospectus, Banco Popular de Puerto Rico and Banco Popular North America are the only material banking subsidiaries of Popular, Inc.

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Liens imposed to secure taxes, assessments or governmental charges or levies are not restricted, however, provided they are:

• not then due or delinquent;

• being contested in good faith;

• are less than $10,000,000 in amount;

• the result of any litigation or legal proceeding which is currently being contested in good faith or which involves claims of less than $10,000,000; or

• deposits to secure surety, stay, appeal or customs bonds.

The subordinated indentures do not contain similar restrictions.

Default and Remedies

Every year each issuer is required to send the trustee for its debt securities a report on its performance of its obligations under the senior indentures and the subordinated indentures and on any default. You will have special rights if an event of default with respect to your senior debt security occurs and is not cured, as described in this subsection.

Events of Default

Senior Indentures. With respect to your senior debt security, the term “event of default” means any of the following:

• The issuer does not pay the principal or any premium, if any, on any senior debt security of that issuer on its due date;

• The issuer does not pay interest on any senior debt security of that issuer within 30 days after its due date;

• The issuer does not deposit a sinking fund payment with regard to any senior debt security of that issuer on its due date, but only if the payment is required in the applicable prospectus supplement;

• The issuer remains in breach of its covenants described above under “— Restrictive Covenants,” or any other covenant it makes in the senior indentures for the benefit of the debt securities of that issuer, for 60 days after it receives a notice of default stating that it is in breach. However, the breach of a covenant that the senior indentures expressly impose only on a different series of senior debt securities than the series of which your senior debt security is a part will not be an event of default with respect to your senior debt security;

• The issuer, the guarantor (when other than the issuer) or any material banking subsidiary of the issuer defaults under borrowed money debt (see below) totaling in excess of $10,000,000, its obligation to repay that debt is accelerated by our lenders and its repayment obligation remains accelerated, unless the debt is paid, the default is cured or waived or the acceleration is rescinded within 30 days after it receives a notice of default;

• The issuer, the guarantor (when other than the issuer) or any material banking subsidiary of the issuer files for bankruptcy, or other events of bankruptcy, insolvency or reorganization relating to an issuer, the guarantor (when other than the issuer) or material banking subsidiary of the issuer occur; or

• If your prospectus supplement states that any additional event of default applies to your senior debt security, that event of default occurs.

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However, a notice of default as described in the fourth and fifth bullet points above must be sent by the trustee or the holders of at least 25% of the principal amount of senior debt securities of the series for those events to be events of default.

“Borrowed money debt” means any of the issuer’s indebtedness for borrowed money or the indebtedness of a material banking subsidiary of the issuer, other than the series of which your senior debt security is a part.

The trustee shall give notice of any default, but notice of a default with respect to a covenant as described in the fourth bullet point above will not be given until at least 30 days after it occurs.

Subordinated Indentures. With respect to your subordinated debt security, the term “event of default” means that a filing for bankruptcy or other events of bankruptcy, insolvency or reorganization relating to the issuer occurs. The subordinated indentures do not provide for any right of acceleration of the payment of principal upon a default in the payment of principal, premium or interest or in the performance of any covenant or agreement on a series of subordinated debt securities or on the subordinated indentures.

Remedies If an Event of Default Occurs

Under certain circumstances, the holders of not less than a majority in principal amount of the debt securities of any series may waive a default for all the debt securities of that series. If this happens, the default will be treated as if it had not occurred.

Senior Indentures. If an event of default on the senior debt securities of any series has occurred and has not been cured or waived, the trustee or the holders of at least 25% in principal amount of the outstanding senior debt securities of that series may declare the entire principal amount of the senior debt securities of that series to be due immediately.

This situation is called an “acceleration of the maturity” of the senior debt securities. If the maturity of any senior debt securities of any series is accelerated, the holders of a majority in principal amount of the senior debt securities of that series affected by the acceleration may cancel the acceleration for all of those senior debt securities if the issuer has paid all amounts due with respect to those securities, other than amounts due because of the acceleration of the maturity, and all events of default, other than nonpayment of their accelerated principal, have been cured or waived.

Subordinated Indentures. If an event of default on the subordinated debt securities of any series has occurred and has not been cured or waived, the trustee or the holders of at least 25% in principal amount of the outstanding subordinated debt securities of that series may declare the entire principal amount of that series of subordinated debt securities to be due immediately. This situation is called an acceleration of the maturity of those subordinated debt securities. If the maturity of any subordinated debt securities of any series is accelerated, the holders of at least a majority in principal amount of the subordinated debt securities of that series affected by the acceleration may cancel the acceleration for all the affected subordinated debt securities.

Trustee’s Indemnity

If an event of default on any series of debt securities occurs, the trustee for those securities will have special duties. In that situation, the trustee will be obligated to use those of its rights and powers under the indenture, and to use the same degree of care and skill in doing so, that a prudent person would use in that situation in conducting his or her own affairs.

Except as described in the prior paragraph, the trustee is not required to take any action under any of the indentures at the request of any holders unless the holders of that series offer the trustee reasonable protection from expenses and liability. This is called an “indemnity.” If reasonable indemnity is provided, the holders of a

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majority in principal amount of all of the outstanding debt securities of that series may direct the time, method and place of conducting any lawsuit or other formal legal action seeking any remedy available to the trustee. These majority holders of that series may also direct the trustee in performing any other action under the indenture with respect to the debt securities of that series.

Before you can bypass the trustee and bring your own lawsuit or other formal legal action or take other steps to enforce your rights or protect your interests relating to your debt securities, the following must occur:

• You must give the trustee written notice that an event of default has occurred, and the event of default must not have been cured or waived;

• The holders of not less than 25% in principal amount of all debt securities of that series must make a written request that the trustee take action because of the default, and they or you must offer reasonable indemnity to the trustee against the cost and other liabilities of taking that action;

• The trustee must not have taken action for 60 days after receipt of the above notice and offer of indemnity; and

• During those 60 days, the holders of a majority in principal amount of the debt securities of that series must not have given the trustee directions that are inconsistent with the written request of the holders of not less than 25% in principal amount of the debt securities of that series.

You are, however, entitled at any time to bring a lawsuit for the payment of money due on your debt security on or after its due date.

Book-entry, street name and other indirect owners should consult their banks or brokers for information on how to give notice or direction to or make a request of the trustee and how to declare or cancel an acceleration of the maturity.

Modification and Waiver of the Indentures

There are three types of changes we can make to the indentures and the debt securities.

Changes Requiring Your Approval

First, there are changes that cannot be made without the approval of each holder of a debt security affected by the change. Here is a list of this type of change:

• change the stated maturity for any principal or interest on a debt security;

• reduce the principal amount, the amount of principal of an original issue discount security payable on acceleration of the maturity after a default, the interest rate or the redemption price of a debt security;

• change the currency of any payment on a debt security;

• change the place of payment on a debt security;

• impair a holder’s right to sue for payment of any amount due on its debt security;

• reduce the percentage in principal amount of the debt securities of any series of debt securities, the approval of whose holders is needed to change the indentures;

• reduce the percentage in principal amount of the debt securities of any series, the consent of whose holders is needed to modify or amend the indenture or waive an issuer’s compliance with the indenture or to waive defaults;

• modify the subordination provision of the subordinated indentures, unless the change would not adversely affect the interests of the holders of that series of debt securities; and

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• in the case of Popular North America, Inc.’s indentures, modify the terms and conditions of the guarantor’s obligations regarding the due and punctual payment of principal or any premium, interest, additional amounts we describe below under “— Taxation by the Commonwealth of Puerto Rico” or sinking fund payment.

Changes Not Requiring Approval

The second type of change does not require any approval by holders of debt securities. This type is limited to clarifications and changes that would not adversely affect the interests of the holders of the debt securities in any material respect, nor do we need your consent to make changes that affect only other debt securities to be issued after the changes take effect.

We may also make changes or obtain waivers that do not adversely affect a particular debt security, even if they affect other debt securities or series of debt securities. In those cases, we do not need to obtain the approval of the holder of that debt security; we need only obtain any required approvals from the holders of the affected debt securities or other debt securities.

Changes Requiring Majority Approval

Any other changes to the indentures and the debt securities would require the following approval:

• If the change affects only one series of debt securities, it must be approved by the holders of at least a majority in principal amount of that series.

• If the change affects more than one series of debt securities, it must be approved by the holders of at least a majority in principal amount of each series of the particular issuer’s debt securities affected by the change.

In each case, the required approval may be given by written consent.

The approval of at least a majority in principal amount of the debt securities of each affected series of an issuer would be required for the issuer to obtain a waiver of any of its covenants in the indentures. The covenants include the promises about merging and putting liens on the issuer’s interests, which we describe above under “— Mergers and Similar Transactions” and “— Restrictive Covenants.” If the required holders approve a waiver of a covenant, we will not have to comply with it. The holders, however, cannot approve a waiver of any provision in a particular debt security, or in the indenture as it affects that debt security, that we cannot change without the approval of the holder of that debt security as described above in “— Changes Requiring Your Approval,” unless that holder approves the waiver.

Book-entry, street name and other indirect owners should consult their banks or brokers for information on how approval may be granted or denied if we seek to change the indentures or the debt securities or request a waiver.

Further Details Concerning Voting

When taking a vote, we will use the following rules to decide how much principal amount to attribute to a debt security:

• For original issue discount securities, we will use the principal amount that would be due and payable on the voting date if the maturity of those debt securities were accelerated to that date because of a default.

• For debt securities whose principal amount is not known, for example, because it is based on an index, we will use a special rule for that debt security determined by our board of directors or described in the prospectus supplement.

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• For debt securities denominated in one or more foreign currencies or composite currencies, we will use the U.S. dollar equivalent.

Debt securities will not be considered outstanding, and therefore will not be eligible to vote, if we have deposited or set aside in trust for you money for their payment or redemption.

We will generally be entitled to set any day as a record date for the purpose of determining the holders of outstanding debt securities that are entitled to vote or take other action under the indenture.

Taxation by the Commonwealth of Puerto Rico

We will not withhold or deduct any present or future taxes, duties, assessments or governmental charges that are imposed or levied by or on behalf of Puerto Rico or by or with any district, municipality or other political subdivision of Puerto Rico from payments to holders of the debt securities and all payments made under the guarantees unless the law requires us to withhold or deduct these taxes, duties, assessments or governmental charges.

In the event that law requires the issuer to deduct or withhold any amounts in respect of these taxes, duties, assessments or governmental charges, the issuer will pay these additional amounts of principal, premium and interest (after deduction of these taxes, duties, assessments or governmental charges) in the payment to the holders of the debt securities, of the amounts which we would otherwise have paid in respect to the debt securities in the absence of deductions or withholding, which we refer to as additional amounts, except that we will not pay any additional amounts:

• to a holder of a debt security or an interest in or rights in a debt security where deduction or withholding is required because the holder has some connection with Puerto Rico or any political subdivision or taxing authority of Puerto Rico or any political subdivision other than the mere holding of and payment in respect of the debt security;

• to a holder of a debt security when any deduction or withholding would not have been required but for the holder’s presentation for payment on a date more than 30 days after maturity or the date on which payment is duly provided for, whichever occurs later; or

• to a holder when any deduction or withholding would not have been required but for the holder’s failure to comply with any certification, identification or other reporting requirements concerning the nationality, residence, identity or connection with Puerto Rico, or any political subdivision or taxing authority of Puerto Rico if law requires compliance as a precondition to exemption from deduction or withholding.

Special Terms Relating to the Subordinated Debt Securities

Unless otherwise indicated in the applicable prospectus supplement, the following provisions apply to the subordinated debt securities and Popular, Inc.’s guarantees of the subordinated debt securities of Popular North America, Inc.

The right of a holder of subordinated debt securities to payment from any distribution of an issuer’s assets resulting from any dissolution, winding up, liquidation, bankruptcy or reorganization of the issuer are subordinated to the prior right to payment in full of all of that issuer’s senior indebtedness (as defined below). The issuer’s obligation to make payments on the subordinated debt securities will not otherwise be affected. No payment on the issuer’s subordinated debt securities may be made during a default on any senior indebtedness of the issuer. Because the subordinated debt securities are subordinated in right of payment to any senior indebtedness of the issuer, in the event of a distribution of assets upon insolvency, some of the issuer’s creditors may recover more, ratably, than holders of subordinated debt securities of the issuer.

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In addition, any amounts of cash, property or securities available after satisfaction of the rights to payment of senior indebtedness will be applied first to pay for the full payment of the issuer’s other financial obligations (as defined below) before any payment will be made to holders of the subordinated debt securities. If the maturity of any subordinated debt securities is accelerated, all senior indebtedness of the issuer would have to be repaid before any payment could be made to holders of the issuer’s subordinated debt securities. Because of this subordination, if an issuer becomes insolvent, its creditors who are not holders of senior indebtedness or subordinated debt securities may recover ratably less than holders of its senior indebtedness and may recover ratably more than holders of its subordinated debt securities.

“Senior indebtedness” of an issuer means an issuer’s indebtedness for money borrowed, except indebtedness that by its terms is not superior in right of payment to the subordinated debt securities.

“Other financial obligations” of an issuer are defined in the subordinated indenture of that issuer to mean obligations of that issuer to make payment pursuant to the terms of financial instruments, such as:

• securities contracts and foreign currency exchange contracts,

• derivative instruments or

• similar financial instruments.

Other financial obligations shall not include:

• obligations on account of an issuer’s senior indebtedness and

• obligations on account of indebtedness for money borrowed ranking equally in their priority of claim to payment with or subordinate to the claim of subordinated debt securities.

Popular, Inc.’s Guarantee

Popular, Inc. will guarantee punctual payment on the Popular North America, Inc. senior debt securities, when and as payments are due and payable. Popular, Inc.’s guarantee is absolute and unconditional, without regard for any circumstance that might otherwise constitute a legal or equitable discharge of a surety or guarantor. A guarantee executed by Popular, Inc. will evidence the guarantee and will appear on each Popular North America senior debt security. Holders of the Popular North America senior debt securities may proceed directly against Popular, Inc. in the event of default under the Popular North America senior debt securities without first proceeding against Popular North America, Inc. The guarantees will rank equally in right of payment with all other unsecured and unsubordinated obligations of Popular, Inc.

Popular, Inc. will guarantee the punctual payment of rights of payment under the Popular North America subordinated debt securities on a subordinated basis and otherwise on the same terms as the Popular North America senior debt securities.

Junior Subordinated Debt Securities

This section describes the general terms and provisions of our junior subordinated debt securities. The applicable prospectus supplement will describe the terms of the series of junior subordinated debt securities, which are sometimes referred to in this prospectus as “debt securities,” offered through that prospectus supplement and any general terms outlined in this section that will not apply to those debt securities. Unless

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otherwise stated in the applicable prospectus supplement, the junior subordinated debt securities will be issued under a junior subordinated indenture, which is sometimes referred to in this prospectus as an “indenture,” dated as of October 1, 2003, between us and The Bank of New York Mellon, as junior subordinated trustee.

We have summarized the material terms and provisions of the junior subordinated indenture in this section. We have also incorporated by reference the junior subordinated indenture as an exhibit to the registration statement. You should read the junior subordinated indenture for additional information before you purchase any trust preferred securities. The summary that follows includes references to section numbers of the junior subordinated indenture so that you can more easily locate these provisions.

General

The junior subordinated debt securities will be our direct unsecured obligations. The junior subordinated indenture does not limit the principal amount of junior subordinated debt securities that we may issue. The junior subordinated indenture permits us to issue junior subordinated debt securities from time to time and junior subordinated debt securities issued under such indenture will be issued as part of a series that has been established by us under such indenture.

The junior subordinated debt securities will be unsecured and will rank equally with all of our other junior subordinated debt securities and, together with such other junior subordinated debt securities, will be subordinated to all of our existing and future Senior Debt. See “— Subordination” below.

The junior subordinated debt securities are our unsecured junior subordinated debt securities, but our assets consist primarily of equity in our subsidiaries. As a result, our ability to make payments on our junior subordinated debt securities depends on our receipt of dividends, loan payments and other funds from our subsidiaries. In addition, if any of our subsidiaries becomes insolvent, the direct creditors of that subsidiary will have a prior claim on its assets. Our rights and the rights of our creditors will be subject to that prior claim, unless we are also a direct creditor of that subsidiary. This subordination of creditors of a parent company to prior claims of creditors of its subsidiaries is commonly referred to as structural subordination.

A prospectus supplement relating to a series of junior subordinated debt securities being offered will include specific terms relating to the offering. These terms will include some or all of the following:

• the title and type of the debt securities;

• any limit on the total principal amount of the debt securities of that series;

• the price at which the debt securities will be issued;

• the date or dates on which the principal of and any premium on the debt securities will be payable;

• the maturity date or dates of the debt securities or the method by which those dates can be determined;

• if the debt securities will bear interest:

• the interest rate on the debt securities or the method by which the interest rate may be determined;

• the date from which interest will accrue;

• the record and interest payment dates for the debt securities;

• the first interest payment date; and

• any circumstances under which we may defer interest payments;

• the place or places where:

• we can make payments on the debt securities;

• the debt securities can be surrendered for registration of transfer or exchange; and

• notices and demands can be given to us relating to the debt securities and under the indenture;

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• any optional redemption provisions that would permit us or the holders of debt securities to elect redemption of the debt securities before their final maturity;

• any sinking fund provisions that would obligate us to redeem the debt securities before their final maturity;

• whether the debt securities will be convertible into shares of common stock, shares of preferred stock or depositary shares and, if so, the terms and conditions of any such conversion, and, if convertible into shares of preferred stock or depositary shares, the terms of such preferred stock or depositary shares;

• if the debt securities will be issued in bearer form, the terms and provisions contained in the bearer securities and in the indenture specifically relating to the bearer securities;

• the currency or currencies in which the debt securities will be denominated and payable, if other than U.S. dollars and, if a composite currency, any special provisions relating thereto;

• any circumstances under which the debt securities may be paid in a currency other than the currency in which the debt securities are denominated and any provisions relating thereto;

• whether the provisions described below under “— Defeasance and Discharge” apply to the debt securities;

• any events of default which will apply to the debt securities in addition to those contained in the indenture and any events of default contained in the indenture which will not apply to the debt securities;

• any additions or changes to or deletions of the covenants contained in the indenture and the ability, if any, of the holders to waive our compliance with those additional or changed covenants;

• whether all or part of the debt securities will be issued in whole or in part as temporary or permanent global securities and, if so, the depositary for those global securities and a description of any book-entry procedures relating to the global securities — a “global security” is a debt security that we issue in accordance with the junior subordinated indenture to represent all or part of a series of debt securities;

• if we issue temporary global securities, any special provisions dealing with the payment of interest and any terms relating to the ability to exchange interests in a temporary global security for interests in a permanent global security or for definitive debt securities;

• the identity of the security registrar and paying agent for the debt securities if other than the junior subordinated trustee;

• any special tax implications of the debt securities;

• any special provisions relating to the payment of any additional amounts on the debt securities;

• the terms of any securities being offered together with or separately from the debt securities;

• the terms and conditions of any obligation or right of Popular or a holder to convert or exchange the debt securities into trust preferred securities or other securities; and

• any other terms of the debt securities.

When we use the term “holder” in this prospectus with respect to a registered debt security, we mean the person in whose name such debt security is registered in the security register.

Additional Sums

If a trust is required to pay any taxes, duties, assessments or governmental charges of whatever nature, other than withholding taxes, imposed by the United States, any political subdivision thereof or Puerto Rico or any other taxing authority of the United States or Puerto Rico, then we will be required to pay additional sums on the

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related junior subordinated debt securities. The amount of any additional sum will be an amount sufficient so that the net amounts received and retained by such trust after paying any such taxes, duties, assessments or other governmental charges will be not less than the amounts that such trust would have received had no such taxes, duties, assessments or other governmental charges been imposed. This means that the trust will be in the same position it would have been in if it did not have to pay such taxes, duties, assessments or other charges.

Payment; Exchange; Transfer

We will designate a place of payment where holders can receive payment of the principal of and any premium and interest on the junior subordinated debt securities. Even though we will designate a place of payment, we may elect to pay any interest on the junior subordinated debt securities by mailing a check to the person listed as the owner of the junior subordinated debt securities in the security register or by wire transfer to an account designated by that person in writing not less than ten days before the date of the interest payment. Unless we state otherwise in the applicable prospectus supplement, we will pay interest on a junior subordinated debt security:

• on an interest payment date, to the person in whose name that junior subordinated debt security is registered at the close of business on the record date relating to that interest payment date; and

• on the date of maturity or earlier redemption or repayment, to the person who surrenders such debt security at the office of our appointed paying agent.

Any money that we pay to a paying agent for the purpose of making payments on the junior subordinated debt securities and that remains unclaimed two years after the payments were due will, at our request, be returned to us and after that time any holder of such debt security can only look to us for the payments on such debt security.

Any junior subordinated debt securities of a series can be exchanged for other junior subordinated debt securities of that series so long as such other debt securities are denominated in authorized denominations and have the same aggregate principal amount and same terms as the junior subordinated debt securities that were surrendered for exchange. The junior subordinated debt securities may be presented for registration of transfer, duly endorsed or accompanied by a satisfactory written instrument of transfer, at the office or agency maintained by us for that purpose in a place of payment. There will be no service charge for any registration of transfer or exchange of the junior subordinated debt securities, but we may require holders to pay any tax or other governmental charge payable in connection with a transfer or exchange of the junior subordinated debt securities. If the applicable prospectus supplement refers to any office or agency, in addition to the security registrar, initially designated by us where holders can surrender the junior subordinated debt securities for registration of transfer or exchange, we may at any time rescind the designation of any such office or agency or approve a change in the location. However, we will be required to maintain an office or agency in each place of payment for that series.

In the event of any redemption, neither we nor the junior subordinated trustee will be required to:

• issue, register the transfer of, or exchange, junior subordinated debt securities of any series during a period beginning at the opening of business 15 days before the day of publication or mailing of the notice of redemption and ending at the close of business on the day of such publication or the mailing of such notice; or

• transfer or exchange any junior subordinated debt securities so selected for redemption, except, in the case of any junior subordinated debt securities being redeemed in part, any portion thereof not to be redeemed.

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Denominations

Unless we state otherwise in the applicable prospectus supplement, the junior subordinated debt securities will be issued only in registered form, without coupons, in denominations of $1,000 each or multiples of $1,000.

Bearer Debt Securities

If we ever issue bearer debt securities, the applicable prospectus supplement will describe all of the special terms and provisions of junior subordinated debt securities in bearer form, and the extent to which those special terms and provisions are different from the terms and provisions which are described in this prospectus, which generally apply to junior subordinated debt securities in registered form, and will summarize provisions of the junior subordinated indenture that relate specifically to bearer debt securities.

Original Issue Discount

Junior subordinated debt securities may be issued under the junior subordinated indenture as original issue discount securities and sold at a substantial discount below their stated principal amount. If a junior subordinated debt security is an original issue discount security, that means that an amount less than the principal amount of such debt security will be due and payable upon a declaration of acceleration of the maturity of such debt security under the junior subordinated indenture. The applicable prospectus supplement will describe the Puerto Rico income tax consequences and other special factors you should consider before purchasing any original issue discount securities.

Option to Defer Interest Payments

If provided in the applicable prospectus supplement, we will have the right from time to time to defer payment of interest on a series of junior subordinated debt securities for up to such number of consecutive interest payment periods as may be specified in the applicable prospectus supplement, subject to the terms, conditions and covenants, if any, specified in such prospectus supplement. Such deferral, however, may not extend beyond the stated maturity of such junior subordinated debt securities. Certain Puerto Rico and United States federal income tax consequences and special considerations applicable to any such debt securities will be described in the applicable prospectus supplement.

Redemption

Unless otherwise specified in the applicable prospectus supplement, the junior subordinated debt securities will not be subject to any sinking fund and will not be redeemable at the option of the holder.

Unless otherwise specified in the applicable prospectus supplement, we may, at our option and subject to receipt of prior approval by the Federal Reserve or its district reserve bank, if required, redeem the junior subordinated debt securities of any series in whole at any time or in part from time to time. If the junior subordinated debt securities of any series are redeemable only on or after a specified date or upon the satisfaction of additional conditions, the applicable prospectus supplement will specify such date or describe such conditions. Except as otherwise specified in the applicable prospectus supplement, the redemption price for any junior subordinated debt security so redeemed will equal 100% of the principal amount of such junior subordinated debt security plus accrued and unpaid interest to the redemption date.

Except as otherwise specified in the applicable prospectus supplement, we may, at our option and subject to receipt of prior approval by the Federal Reserve, if required, redeem a series of junior subordinated debt securities in whole, but not in part, at any time within 90 days after the occurrence of a tax event, investment company event or capital treatment event, each as defined below, at a redemption price equal to 100% of the principal amount of such junior subordinated debt securities then outstanding plus accrued and unpaid interest to the redemption date.

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“Tax Event” means the receipt by a trust of an opinion of counsel experienced in such matters to the effect that, as a result of any amendment to, or change in, including any announced proposed change in, the laws or regulations of the United States, any political subdivision thereof or Puerto Rico, or any taxing authority thereof or therein, or as a result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which proposed change, pronouncement or decision is announced on or after the date of the prospectus supplement relating to the issuance of trust preferred securities by such trust, there is more than an insubstantial risk that:

• such trust is, or will be within 90 days of the date of such opinion, subject to United States federal or Puerto Rico income tax with respect to income received or accrued on the junior subordinated debt securities;

• interest payable by Popular on the junior subordinated debt securities is not, or within 90 days of the date of such opinion, will not be, deductible by Popular, in whole or in part, for Puerto Rico income tax purposes; or

• such trust is, or will be within 90 days of the date of such opinion, subject to more than an immaterial amount of other taxes, duties or other governmental charges.

“Investment Company Event” means the receipt by a trust of an opinion of counsel experienced in such matters to the effect that, as a result of the occurrence of a change in law or regulation or a written change, including any announced prospective 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 such trust is or will be considered an “investment company” that is required to be registered under the Investment Company Act of 1940, which change or prospective change becomes effective or would become effective, as the case may be, on or after the date of the prospectus supplement relating to the issuance of the trust preferred securities.

“Capital Treatment Event” means our reasonable determination that, as a result of any amendment to, or change in, including any announced proposed change in, the laws or regulations of the United States or any political subdivision thereof or Puerto Rico, or as a result of any official or administrative pronouncement or action or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which proposed change, pronouncement, action or decision is announced on or after the date of the prospectus supplement relating to issuance of trust preferred securities by such trust, there is more than an insubstantial risk that Popular will not be entitled to treat an amount equal to the liquidation amount of such trust preferred securities as Tier I capital, or the then-equivalent thereof, for purposes of the capital adequacy guidelines of the Federal Reserve, as then in effect and applicable to Popular.

Notice of any redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each holder of junior subordinated debt securities to be redeemed at its registered address. However, if the debt securities are held by a trust, notice shall be mailed at least 45 days but not more than 75 days before the redemption date. Unless we default in payment of the redemption price, on and after the redemption date, interest will cease to accrue on such junior subordinated debt securities or portions thereof called for redemption.

Restrictions on Certain Payments

Unless otherwise specified in the applicable prospectus supplement, if:

• there shall have occurred and be continuing an event of default with respect to a series of junior subordinated debt securities of which we have actual knowledge and which we have not taken reasonable steps to cure;

• the junior subordinated debt securities of a series are held by a trust and we shall be in default relating to our payment of any obligations under our guarantee of the trust preferred securities issued by such trust; or

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• we shall have given notice of our election to defer payments of interest on a series of junior subordinated debt securities by extending the interest payment period and such period, or any extension of such period, shall be continuing;

then:

• we shall not declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any shares of our capital stock, including our preferred stock; and

• we shall not make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt securities issued by us that rank equally with or junior to the junior subordinated debt securities (except for partial payments of interest with respect to the junior subordinated debt securities).

The restrictions listed above do not apply to:

• any repurchase, redemption or other acquisition of shares of our capital stock in connection with (1) any employment contract, benefit plan or other similar arrangement with or for the benefit of any one or more employees, officers, directors, consultants or independent contractors, (2) a dividend reinvestment or stockholder purchase plan, or (3) the issuance of our capital stock, or securities convertible into or exercisable for such capital stock, as consideration in an acquisition transaction entered into prior to the applicable extension period;

• any exchange, redemption or conversion of any class or series of our capital stock, or the capital stock of one of our subsidiaries, for any other class or series of our capital stock, or of any class or series of our indebtedness for any class or series of our capital stock;

• any purchase of fractional interests in shares of our capital stock pursuant to the conversion or exchange provisions of such capital stock or the securities being converted or exchanged;

• any declaration of a dividend in connection with any rights plan, or the issuance of rights, stock or other property under any rights plan, or the redemption or repurchase of rights pursuant thereto;

• payments by us under any guarantee agreement executed for the benefit of the trust preferred securities; or

• any dividend in the form of stock, warrants, options or other rights where the dividend stock or 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 equally with or junior to such stock.

Limitation on Mergers and Sales of Assets

The junior subordinated indenture generally permits a consolidation or merger between us and another entity. It also permits the sale or transfer by us of all or substantially all of our property and assets. These transactions are permitted if:

• the resulting or acquiring entity, if other than us, is organized and existing under the laws of the United States or any state, the District of Columbia or the Commonwealth of Puerto Rico and assumes all of our responsibilities and liabilities under the junior subordinated indenture, including the payment of all amounts due on the debt securities and performance of the covenants in the junior subordinated indenture; and

• immediately after the transaction, and giving effect to the transaction, no event of default under the junior subordinated indenture exists.

If we consolidate or merge with or into any other entity or sell or lease all or substantially all of our assets according to the terms and conditions of the junior subordinated indenture, the resulting or acquiring entity will

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be substituted for us in such indenture with the same effect as if it had been an original party to the indenture. As a result, such successor entity may exercise our rights and powers under the junior subordinated indenture, in our name and, except in the case of a lease of all or substantially all of our properties, we will be released from all our liabilities and obligations under such indenture and under the junior subordinated debt securities.

Events of Default, Waiver and Notice

Unless otherwise specified in the applicable prospectus supplement, an “event of default,” when used in the junior subordinated indenture with respect to any series of junior subordinated debt securities, means any of the following:

• failure to pay interest on a junior subordinated debt security of that series for 30 days after the payment is due (subject to the deferral of any due date in the case of an extension period);

• failure to pay the principal of or any premium on any junior subordinated debt security of that series when due;

• failure to deposit any sinking fund payment on junior subordinated debt securities of that series when due;

• failure to perform any other covenant in the junior subordinated indenture that applies to junior subordinated debt securities of that series for 90 days after we have received written notice of the failure to perform in the manner specified in the junior subordinated indenture;

• certain events relating to a bankruptcy, insolvency or reorganization of Popular; or

• any other event of default that may be specified for the junior subordinated debt securities of that series when that series is created.

If an event of default under the junior subordinated indenture occurs and continues, the junior subordinated trustee or the holders of at least 25% in aggregate principal amount of the outstanding junior subordinated debt securities of that series may declare the entire principal and all accrued but unpaid interest of all debt securities of that series to be due and payable immediately. If the trustee or the holders of junior subordinated debt securities do not make such declaration and the junior subordinated debt securities of that series are held by a trust or trustee of such trust, the property trustee or the holders of at least 25% in aggregate liquidation amount of the related trust preferred securities shall have the right to make such declaration. If an event of default under the junior subordinated indenture occurs and continues and the junior subordinated debt securities of that series are held by a trust or trustee of such trust, the property trustee may also declare the principal of and the interest on the junior subordinated debt securities to be due and payable and may enforce its other rights as a creditor with respect to the junior subordinated debt securities.

If such a declaration occurs, the holders of a majority of the aggregate principal amount of the outstanding junior subordinated debt securities of that series can, subject to certain conditions (including, if the junior subordinated debt securities of that series are held by a trust or a trustee of such trust, the consent of the holders of at least a majority in aggregate liquidation amount of the related trust preferred securities), rescind the declaration. If the holders of such junior subordinated debt securities do not rescind such declaration and such junior subordinated debt securities are held by a trust or trustee of such trust, the holders of at least a majority in aggregate liquidation amount of the related trust preferred securities shall have the right to rescind the declaration.

The holders of a majority in aggregate principal amount of the outstanding junior subordinated debt securities of any series may, on behalf of all holders of that series, waive any past default, except:

• a default in payment of principal of or any premium or interest; or

• a default under any provision of the junior subordinated indenture which itself cannot be modified or amended without the consent of the holder of each outstanding junior subordinated debt security of that series.

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If the junior subordinated debt securities of that series are held by a trust or a trustee of such trust, any such waiver shall require the consent of the holders of at least a majority in aggregate liquidation amount of the related trust preferred securities. If the holders of junior subordinated debt securities do not waive such default, the holders of a majority in aggregate liquidation amount of the related trust preferred securities shall have the right to waive such default.

The holders of a majority in principal amount of the junior subordinated debt securities of any series affected shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the junior subordinated trustee under the junior subordinated indenture.

We are required to file an officers’ certificate with the junior subordinated trustee each year that states, to the knowledge of the certifying officer, whether or not any defaults exist under the terms of the junior subordinated indenture.

If the junior subordinated debt securities of any series are held by a trust or a trustee of such trust, a holder of the related trust preferred securities may institute a direct action if we fail to make interest or other payments on the junior subordinated debt securities when due, taking account of any extension period. A direct action may be brought without first:

• directing the property trustee to enforce the terms of the junior subordinated debt securities, or

• suing us to enforce the property trustee’s rights under such junior subordinated debt securities.

This right of direct action cannot be amended in a manner that would impair the rights of the holders of trust preferred securities thereunder without the consent of all holders of affected trust preferred securities.

The Junior Subordinated Indenture Does Not Restrict Our Ability to Take Certain Actions That May Affect the Junior Subordinated Debt Securities

The junior subordinated indenture does not contain restrictions on our ability to:

• incur, assume or become liable for any type of debt or other obligation;

• create liens on our property for any purpose; or

• pay dividends or make distributions on our capital stock or repurchase or redeem our capital stock, except as set forth above under “— Restrictions on Certain Payments.”

The junior subordinated indenture does not require the maintenance of any financial ratios or specified levels of net worth or liquidity. In addition, the junior subordinated indenture does not contain any provisions which would require us to repurchase or redeem or modify the terms of any of the junior subordinated debt securities upon a change of control or other event involving us which may adversely affect the creditworthiness of such debt securities.

Distribution

Under circumstances involving the dissolution of a trust, which will be discussed more fully in the applicable prospectus supplement, the junior subordinated debt securities may be distributed to the holders of the trust securities in liquidation of that trust, provided that any required regulatory approval is obtained. See “Description of Capital Securities We May Offer — Trust Preferred Securities — Liquidation Distribution upon Dissolution.”

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Modification of Junior Subordinated Indenture

Under the junior subordinated indenture, certain of our rights and obligations and certain of the rights of holders of the junior subordinated debt securities may be modified or amended with the consent of the holders of at least a majority of the aggregate principal amount of the outstanding junior subordinated debt securities of all series affected by the modification or amendment, acting as one class. However, the following modifications and amendments will not be effective against any holder without its consent:

• a change in the stated maturity date of any payment of principal or interest, including any additional interest (other than to the extent set forth in the applicable junior subordinated debt security);

• a reduction in payments due on the junior subordinated debt securities;

• a change in the place of payment or currency in which any payment on the junior subordinated debt securities is payable;

• a limitation of a holder’s right to sue us for the enforcement of payments due on the junior subordinated debt securities;

• a reduction in the percentage of outstanding junior subordinated debt securities required to consent to a modification or amendment of the junior subordinated indenture or required to consent to a waiver of compliance with certain provisions of such indenture or certain defaults under such indenture;

• a reduction in the requirements contained in the junior subordinated indenture for quorum or voting;

• a limitation of a holder’s right, if any, to repayment of junior subordinated debt securities at the holder’s option;

• in the case of junior subordinated debt securities convertible into common stock, a limitation of any right to convert such debt securities; and

• a modification of any of the foregoing requirements contained in the junior subordinated indenture.

Under the junior subordinated indenture, the holders of at least a majority of the aggregate principal amount of the outstanding junior subordinated debt securities of all series affected by a particular covenant or condition, acting as one class, may, on behalf of all holders of such series of debt securities, waive compliance by us with any covenant or condition contained in the junior subordinated indenture unless we specify that such covenant or condition cannot be so waived at the time we establish the series.

If the junior subordinated debt securities are held by a trust or the trustee of such trust, no modification may be made that adversely affects the holders of the related trust preferred securities, and no termination of the junior subordinated indenture may occur, and no waiver of any compliance with any covenant will be effective without the prior consent of a majority in liquidation amount of the trust preferred securities of such trust. If the consent of the holder of each outstanding junior subordinated debt security is required for such modification or waiver, no such modification or waiver shall be effective without the prior consent of each holder of trust preferred securities of such trust.

We and the junior subordinated trustee may execute, without the consent of any holder of junior subordinated debt securities, any supplemental junior subordinated indenture for the purpose of creating any new series of junior subordinated debt securities.

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Defeasance and Discharge

Defeasance and Discharge. At the time that we establish a series of junior subordinated debt securities under the junior subordinated indenture, we can provide that the debt securities of that series are subject to the defeasance and discharge provisions of that indenture. If we so provide, we will be discharged from our obligations on the debt securities of that series if:

• we deposit with the junior subordinated trustee, in trust, sufficient money or, if the junior subordinated debt securities of that series are denominated and payable in U.S. dollars only, Eligible Instruments, to pay the principal, any interest, any premium and any other sums due on the debt securities of that series, such as sinking fund payments, on the dates the payments are due under the junior subordinated indenture and the terms of such debt securities;

• we deliver to the junior subordinated trustee an opinion of counsel that states that the holders of the junior subordinated debt securities of that series will not recognize income, gain or loss for Puerto Rico or United States federal income tax purposes as a result of the deposit and will be subject to Puerto Rico or United States federal income tax on the same amounts and in the same manner and at the same times as would have been the case if no deposit had been made; and

• if the junior subordinated debt securities of that series are listed on any domestic or foreign securities exchange, such debt securities will not be delisted as a result of the deposit.

When we use the term “Eligible Instruments” in this section, we mean monetary assets, money market instruments and securities that are payable in dollars only and are essentially risk free as to collection of principal and interest, including:

• direct obligations of the United States backed by the full faith and credit of the United States; or

• any obligation of a person controlled or supervised by and acting as an agency or instrumentality of the United States if the timely payment of the obligation is unconditionally guaranteed as a full faith and credit obligation by the United States.

In the event that we deposit money or Eligible Instruments, or a combination of both, in trust and discharge our obligations under a series of junior subordinated debt securities as described above, then:

• the junior subordinated indenture, including the subordination provisions contained in the junior subordinated indenture, will no longer apply to the junior subordinated debt securities of that series; however, certain obligations to compensate, reimburse and indemnify the junior subordinated trustee, to register the transfer and exchange of junior subordinated debt securities, to replace lost, stolen or mutilated junior subordinated debt securities, to maintain paying agencies and the trust funds and to pay additional amounts, if any, required as a result of withholding taxes imposed on payments to non-U.S. persons will continue to apply; and

• holders of junior subordinated debt securities of that series can only look to the trust fund for payment of principal, any premium and any interest on such debt securities of that series.

Defeasance of Certain Covenants and Certain Events of Default. At the time that we establish a series of junior subordinated debt securities under the junior subordinated indenture, we can provide that the debt securities of that series are subject to the covenant defeasance provisions of such indenture. If we so provide and we make the deposit and deliver the opinion of counsel described above in this section under “— Defeasance and Discharge” we will not have to comply with any covenant we designate when we establish the series of debt securities. In the event of a covenant defeasance, our obligations under the junior subordinated indenture and the junior subordinated debt securities, other than with respect to the covenants specifically referred to above, will remain in effect.

If we exercise our option not to comply with the covenants listed above and the junior subordinated debt securities of that series become immediately due and payable because an event of default under the junior subordinated indenture has occurred, other than as a result of an event of default specifically referred to above,

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the amount of money and Eligible Instruments on deposit with the junior subordinated trustee will be sufficient to pay the principal, any interest, any premium and any other sums due on the debt securities of that series, such as sinking fund payments, on the date the payments are due under the junior subordinated indenture and the terms of the junior subordinated debt securities, but may not be sufficient to pay amounts due at the time of acceleration. However, we would remain liable for the balance of the payments.

Conversion or Exchange

The junior subordinated debt securities may be convertible or exchangeable into junior subordinated debt securities of another series or into trust preferred securities of any of our trusts, on the terms provided in the applicable prospectus supplement. Such terms may include provisions for conversion or exchange, either mandatory, at the option of the holder, or at our option, in which case the number of shares of trust preferred securities or other securities to be received by the holders of junior subordinated debt securities would be calculated as of a time and in the manner stated in the applicable prospectus supplement.

Subordination

The junior subordinated debt securities will be subordinated to all of our existing and future Senior Debt, as defined below. Our “Senior Debt” includes our senior debt securities and our subordinated debt securities and means:

• any of our indebtedness for borrowed or purchased money, whether or not evidenced by bonds, debt securities, notes or other written instruments,

• our obligations under letters of credit,

• any of our indebtedness or other obligations with respect to commodity contracts, interest rate and currency swap agreements, cap, floor and collar agreements, currency spot and forward contracts, and other similar agreements or arrangements designed to protect against fluctuations in currency exchange or interest rates, and

• any guarantees, endorsements (other than by endorsement of negotiable instruments for collection in the ordinary course of business) or other similar contingent obligations in respect of obligations of others of a type described above, whether or not such obligation is classified as a liability on a balance sheet prepared in accordance with generally accepted accounting principles, whether outstanding on the date of execution of the junior subordinated indenture or thereafter incurred, other than obligations expressly on a parity with or junior to the junior subordinated debt securities. The junior subordinated debt securities will rank on a parity with obligations evidenced by any debt securities, and guarantees in respect of those debt securities, initially issued to any trust, partnership or other entity affiliated with us, that is, directly or indirectly, our financing vehicle in connection with the issuance by such entity of capital securities or other similar securities.

If certain events relating to a bankruptcy, insolvency or reorganization of Popular occur, we will first pay all Senior Debt, including any interest accrued after the events occur, in full before we make any payment or distribution, whether in cash, securities or other property, on account of the principal of or interest on the junior subordinated debt securities. In such an event, we will pay or deliver directly to the holders of Senior Debt any payment or distribution otherwise payable or deliverable to holders of the junior subordinated debt securities. We will make the payments to the holders of Senior Debt according to priorities existing among those holders until we have paid all Senior Debt, including accrued interest, in full. Notwithstanding the subordination provisions discussed in this paragraph, we may make payments or distributions on the junior subordinated debt securities so long as:

• the payments or distributions consist of securities issued by us or another company in connection with a plan of reorganization or readjustment; and

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• payment on those securities is subordinate to outstanding Senior Debt and any securities issued with respect to Senior Debt under such plan of reorganization or readjustment at least to the same extent provided in the subordination provisions of the junior subordinated debt securities.

If such events relating to a bankruptcy, insolvency or reorganization of Popular occur, after we have paid in full all amounts owed on Senior Debt, the holders of junior subordinated debt securities, together with the holders of any of our other obligations ranking equal with those junior subordinated debt securities, will be entitled to receive from our remaining assets any principal, premium or interest due at that time on the junior subordinated debt securities and such other obligations before we make any payment or other distribution on account of any of our capital stock or obligations ranking junior to those junior subordinated debt securities.

If we violate the junior subordinated indenture by making a payment or distribution to holders of the junior subordinated debt securities before we have paid all the Senior Debt in full, then such holders of the junior subordinated debt securities will be deemed to have received the payments or distributions in trust for the benefit of, and will have to pay or transfer the payments or distributions to, the holders of the Senior Debt outstanding at the time. The payment or transfer to the holders of the Senior Debt will be made according to the priorities existing among those holders. Notwithstanding the subordination provisions discussed in this paragraph, holders of junior subordinated debt securities will not be required to pay, or transfer payments or distributions to, holders of Senior Debt so long as:

• the payments or distributions consist of securities issued by us or another company in connection with a plan of reorganization or readjustment; and

• payment on those securities is subordinate to outstanding Senior Debt and any securities issued with respect to Senior Debt under such plan of reorganization or readjustment at least to the same extent provided in the subordination provisions of those junior subordinated debt securities.

Because of the subordination, if we become insolvent, holders of Senior Debt may receive more, ratably, and holders of the junior subordinated debt securities may receive less, ratably, than our other creditors. This type of subordination will not prevent an event of default from occurring under the junior subordinated indenture in connection with the junior subordinated debt securities.

We may modify or amend the junior subordinated indenture as provided under “— Modification of Junior Subordinated Indenture” above. However, the modification or amendment may not, without the consent of the holders of all Senior Debt outstanding, modify any of the provisions of the junior subordinated indenture relating to the subordination of the junior subordinated debt securities in a manner that would adversely affect the holders of Senior Debt.

The junior subordinated indenture places no limitation on the amount of Senior Debt that we may incur. We expect from time to time to incur additional indebtedness and other obligations constituting Senior Debt.

Governing Law

The junior subordinated indenture and the junior subordinated debt securities will be governed by, and construed in accordance with, the internal laws of the Commonwealth of Puerto Rico.

The Trustee

The junior subordinated trustee will have all of the duties and responsibilities specified under the Trust Indenture Act. Other than its duties in case of a default, the trustee is under no obligation to exercise any of the powers under the junior subordinated indenture at the request, order or direction of any holders of junior subordinated debt securities unless offered reasonable indemnification.

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Correspondence Between Junior Subordinated Debt Securities and Trust Preferred Securities

Popular may issue one or more series of junior subordinated debt securities under the junior subordinated indenture with terms corresponding to the terms of a series of trust preferred securities. In each such instance, concurrently with the issuance of a trust’s preferred securities, such trust will invest the proceeds from that issuance, together with the consideration paid by Popular for the common securities of such trust, in that series of junior subordinated debt securities. Each series of junior subordinated debt securities will be in a principal amount equal to the aggregate stated liquidation amount of the related trust preferred securities and the common securities of such trust and will rank equally with all other series of junior subordinated debt securities. Holders of the trust preferred securities will have the rights, in connection with modifications to the junior subordinated indenture or upon occurrence of an event of default, as described under “— Modification of Junior Subordinated Indenture” and “— Events of Default, Waiver and Notice.”

Unless otherwise specified in the applicable prospectus supplement, if a tax event, investment company event or capital treatment event relating to a trust occurs and continues, we may, at our option and subject to any required prior approval of the Federal Reserve, redeem the junior subordinated debt securities at any time within 90 days of the occurrence of such event, in whole but not in part, subject to the provisions of the junior subordinated indenture and whether or not such junior subordinated debt securities are then redeemable at our option.

The redemption price for any junior subordinated debt security shall be equal to 100% of the principal amount of such junior subordinated debt security then outstanding plus accrued and unpaid interest to the redemption date. As long as a trust is the holder of all the outstanding junior subordinated debt securities of a series, the proceeds of any redemption will be used by such trust to redeem the related trust securities in accordance with their terms.

We will covenant, as to each series of junior subordinated debt securities:

• to directly or indirectly maintain 100% ownership of the common securities of the applicable trust unless a permitted successor succeeds to ownership of the common securities;

• not to voluntarily terminate, wind up or liquidate any trust, except:

• in connection with a distribution of junior subordinated debt securities to the holders of trust preferred securities in exchange therefor upon liquidation of such trust, or

• in connection with certain mergers, consolidations or amalgamations permitted by the applicable trust agreement, in either such case, if so specified in the applicable prospectus supplement and upon any required prior approval of the Federal Reserve; and

• to use our reasonable efforts, consistent with the terms and provisions of the applicable trust agreement, to cause such trust to remain classified as a grantor trust and not as an association taxable as a corporation for United States federal or Puerto Rico income tax purposes.

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DESCRIPTION OF CAPITAL SECURITIES WE MAY OFFER

Trust Preferred Securities

The trust preferred securities will be issued by a trust under the terms of a trust agreement. Each trust agreement will be qualified as an indenture under the Trust Indenture Act. Each trust may issue only one series of trust preferred securities. The property trustee will act as trustee for each series of trust preferred securities under the applicable trust agreement for purposes of compliance with the provisions of the Trust Indenture Act. The terms of each series of trust preferred securities will include those stated in the applicable trust agreement and those made part of such trust agreement by the Trust Indenture Act.

We have summarized material terms and provisions of the trust preferred securities in this section. This summary is not intended to be complete and is qualified by the trust agreement, the form of which we filed as an exhibit to the registration statement, the Delaware Statutory Trust Act and the Trust Indenture Act.

As used in this section, “we,” “us,” “our” and similar terms mean Popular, Inc. with respect to Popular Capital Trust IV, and Popular, Inc. and Popular North America, Inc. with respect to Popular North America Capital Trust II and Popular North America Capital Trust III. References in this prospectus to the “Trusts” refer to Popular Capital Trust IV, Popular North America Capital Trust II and Popular North America Capital Trust III.

Each trust agreement authorizes the trustees of the applicable trust to issue trust securities on behalf of such trust. The trust securities represent undivided beneficial interests in the assets of such trust. We will own, directly or indirectly, all of a trust’s common securities. The common securities rank equally, and payments will be made on a pro rata basis, with the trust preferred securities except as set forth under “— Ranking of Trust Securities.”

Each trust agreement does not permit a trust to issue any securities other than the trust securities or to incur any indebtedness. Under each trust agreement, the property trustee will own the junior subordinated debt securities purchased by such trust for the benefit of the holders of the trust securities.

The guarantee agreement we execute for the benefit of the holders of trust preferred securities will be a guarantee on a subordinated basis with respect to the related trust securities. However, such guarantee will not guarantee payment of distributions or amounts payable on redemption or liquidation of such trust securities when a trust does not have funds on hand available to make such payments. See “— Description of Guarantees” below.

Distributions

Distributions on each series of trust preferred securities:

• will be cumulative;

• will accumulate from the date of original issuance; and

• will be payable on such dates as specified in the applicable prospectus supplement.

In the event that any date on which distributions are payable on the trust preferred securities is not a business day, then payment of the distribution will be made on the next succeeding business day, and without any interest or other payment in respect to any such delay. Each date on which distributions are payable in accordance with the foregoing is referred to as a “distribution date.” The term “distribution” includes any interest payable on unpaid distributions unless otherwise stated. Unless otherwise specified in the applicable prospectus supplement, a “business day” is a day other than a Saturday, a Sunday, or any other day on which banking institutions in Puerto Rico, Wilmington, Delaware and New York, New York are authorized or required by law, regulation or executive order to remain closed or are customarily closed.

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The amount of distributions payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. The amount of distributions payable for any period shorter than a full distribution period will be computed on the basis of the actual number of days elapsed in a partial month in that period. Distributions to which holders of trust preferred securities are entitled but are not paid will accumulate additional distributions at the annual rate if and as specified in the applicable prospectus supplement.

If provided in the applicable prospectus supplement, we have the right under the junior subordinated indenture and the junior subordinated debt securities to which the prospectus supplement relates to defer the payment of interest on the junior subordinated debt securities for up to a number of consecutive interest payment periods that will be specified in the applicable prospectus supplement. We refer to this period as an “extension period.” No extension period may extend beyond the stated maturity of the junior subordinated debt securities to which the extension period relates.

As a consequence of any such deferral, distributions on the trust preferred securities would be deferred by the related trust during any extension period, but would continue to accumulate additional distributions at the annual rate set forth in the prospectus supplement for such trust preferred securities.

Unless otherwise specified in the applicable prospectus supplement, if we exercise our deferral right, then during any extension period, we may not:

• make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt securities issued by us that rank equally with or junior to the junior subordinated debt securities (except for partial payments of interest with respect to the junior subordinated debt securities); or

• declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any shares of our capital stock, other than:

• any repurchase, redemption or other acquisition of shares of our capital stock (1) in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of any one or more employees, officers, directors, consultants or independent contractors, (2) in connection with a dividend reinvestment or stockholder stock purchase plan or (3) in connection with the issuance of our capital stock, or securities convertible into or exercisable for such capital stock, as consideration in an acquisition transaction entered into before the applicable extension period;

• any exchange, redemption or conversion of any class or series of our capital stock, or any capital stock of one of our subsidiaries, for any other class or series of our capital stock, or of any class or series of our indebtedness for any class or series of our capital stock;

• any purchase of fractional interests in shares of our capital stock pursuant to the conversion or exchange provisions of such capital stock or the securities being converted or exchanged;

• any declaration of a dividend in connection with any rights plan, or the issuance of rights, stock or other property under any rights plan, or the redemption or repurchase of rights pursuant thereto;

• payments by us under any guarantee agreement executed for the benefit of the trust preferred securities; or

• 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 equally with or junior to such stock.

The funds available to each trust for distribution to holders of its trust preferred securities will be limited to payments under the junior subordinated debt securities in which such trust invests the proceeds from the issuance and sale of its trust securities. See “Description of Debt Securities We May Offer — Junior Subordinated Debt Securities — Correspondence Between Junior Subordinated Debt Securities and Trust Preferred Securities.” If

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we do not make interest payments on such junior subordinated debt securities, the property trustee will not have funds available to pay distributions on the related trust preferred securities. To the extent a trust has funds legally available for the payment of such distributions and cash sufficient to make such payments, the payment of distributions is guaranteed by us on the basis set forth below under “— Description of Guarantees.”

Distributions on the trust preferred securities will be payable to the holders of such securities as they appear on the register of the applicable trust on the relevant record dates, which shall be the 15th calendar day, whether or not a business day, before the distribution date.

Redemption or Exchange

Mandatory Redemption

Upon the repayment or redemption, in whole or in part, of any junior subordinated debt securities, whether at stated maturity or upon earlier redemption as provided in the junior subordinated indenture, the property trustee will apply the proceeds from such repayment or redemption to redeem a like amount, as defined below, of the related trust securities, upon not less than 30 nor more than 60 days’ notice. The redemption price will equal the aggregate liquidation amount of such trust securities, as defined below, plus accumulated but unpaid distributions to the date of redemption and the amount of the premium, if any, paid by us upon the concurrent redemption of such junior subordinated debt securities. See “Description of Debt Securities We May Offer — Junior Subordinated Debt Securities — Redemption.” If less than all of any series of junior subordinated debt securities are to be repaid or redeemed on a redemption date, then the proceeds from such repayment or redemption will be allocated pro rata to the redemption of the related trust preferred securities and the common securities, except as set forth below under “— Ranking of Trust Securities.”

The amount of premium, if any, paid by us upon the redemption or repayment of all or any part of any series of junior subordinated debt securities will be allocated pro rata to the redemption of the related trust preferred securities and common securities, except as set forth below under “— Ranking of Trust Securities.”

We will have the right to redeem any series of junior subordinated debt securities:

• on or after such date as may be specified in the applicable prospectus supplement, in whole at any time or in part from time to time; or

• at any time, in whole but not in part, upon the occurrence of a tax event, investment company event or capital treatment event, in any case subject to receipt of any required prior approval by the Federal Reserve. See “Description of Debt Securities We May Offer — Junior Subordinated Debt Securities — Redemption.”

Within 90 days after any tax event, investment company event or capital treatment event occurs and continues, we will have the right to redeem the junior subordinated debt securities in whole, but not in part, and thereby cause a mandatory redemption of the related trust preferred securities and common securities in whole, but not in part, at the redemption price described above. In the event:

• a tax event, investment company event or capital treatment event occurs and continues, and

• we do not elect to redeem the junior subordinated debt securities and thereby cause a mandatory redemption of the related trust preferred securities and common securities or to dissolve the related trust and cause the junior subordinated debt securities to be distributed to holders of such trust preferred securities and common securities in exchange therefor upon liquidation of the trust as described below, the related trust preferred securities will remain outstanding.

“Like Amount” means:

• with respect to a redemption of any series of trust securities, trust securities of such series having a liquidation amount equal to that portion of the principal amount of junior subordinated debt securities to be contemporaneously redeemed in accordance with the junior subordinated indenture, the proceeds of which will be used to pay the redemption price of such trust securities; and

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• with respect to a distribution of junior subordinated debt securities to holders of any series of trust securities in exchange therefor in connection with a dissolution or liquidation of a trust, junior subordinated debt securities having a principal amount equal to the liquidation amount of the trust securities of the holder to whom such junior subordinated debt securities would be distributed.

“Liquidation Amount” means the stated amount per trust security as set forth in the applicable prospectus supplement.

Distribution of Junior Subordinated Debt Securities

We will have the right at any time to liquidate a trust and cause the junior subordinated debt securities to be distributed to the holders of the related trust securities. This may require the prior approval of the Federal Reserve. Upon liquidation of the trust and after satisfaction of the liabilities of creditors of such trust as provided by applicable law, the junior subordinated debt securities held by such trust will be distributed to the holders of the trust securities of such trust in exchange therefor.

After the liquidation date fixed for any distribution of junior subordinated debt securities for any series of trust preferred securities:

• such series of trust preferred securities will no longer be deemed to be outstanding;

• the depositary or its nominee, as the record holder of such series of trust preferred securities, will receive a registered global certificate or certificates representing the junior subordinated debt securities to be delivered upon such distribution;

• any certificates representing such series of trust preferred securities not held by The Depository Trust Company, or “DTC,” or its nominee, or surrendered to the exchange agent will be deemed to represent the junior subordinated debt securities to be delivered in the exchange, having a principal amount equal to the stated liquidation amount of such series of trust preferred securities, and bearing accrued and unpaid interest in an amount equal to the accrued and unpaid distributions on such series of trust preferred securities until such certificates are so surrendered for transfer or reissuance; and

• all rights of the holders of such trust preferred securities will cease, except the right to receive junior subordinated debt securities, in the principal amount set forth above, upon such surrender.

Redemption Procedures

Trust preferred securities redeemed on any redemption date will be redeemed at the redemption price, as described in the applicable prospectus supplement, with the proceeds from the contemporaneous redemption of the junior subordinated debt securities. Redemptions of trust preferred securities shall be made and the redemption price shall be payable on each redemption date only to the extent that the applicable trust has funds on hand available for the payment of such redemption price. See also “— Ranking of Trust Securities” below. Redemptions of trust preferred securities may require prior approval of the Federal Reserve.

If a trust gives a notice of redemption of its trust preferred securities, then, by 12:00 noon, New York time, on the redemption date, to the extent funds are available, the property trustee will deposit irrevocably with DTC funds sufficient to pay the redemption price and will give DTC irrevocable instructions and authority to pay the redemption price to the holders of such trust preferred securities. If such trust preferred securities are no longer in book-entry form, the property trustee, to the extent funds are available, will irrevocably deposit with the paying agent for such trust preferred securities funds sufficient to pay the redemption price and will give such paying agent irrevocable instructions and authority to pay the redemption price to the holders thereof upon surrender of their certificates evidencing such trust preferred securities.

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Notwithstanding the foregoing, distributions payable on or before the redemption date for any trust preferred securities called for redemption will be payable to the holders of such trust preferred securities on the relevant record dates for the related distribution dates. If notice of redemption shall have been given and funds deposited as required, then upon the date of such deposit:

• all rights of the holders of such trust preferred securities will cease, except the right to receive the redemption price on the redemption date, but without interest on such redemption price after the date of redemption; and

• such trust preferred securities will cease to be outstanding.

In the event that any date fixed for redemption of trust preferred securities is not a business day, then payment of the redemption price will be made on the next succeeding business day, without any interest or any other payment in respect of any such delay. In the event that payment of the redemption price in respect of trust preferred securities called for redemption is improperly withheld or refused and not paid either by the applicable trust or by us pursuant to the guarantee as described under “— Description of Guarantees,” distributions on such trust preferred securities will continue to accrue at the then-applicable rate, from the redemption date originally established by such trust for such trust preferred securities to the date such redemption price is actually paid, in which case the actual payment date will be the date fixed for redemption for purposes of calculating the redemption price.

If less than all of the trust securities issued by a trust are to be redeemed on a redemption date, then the aggregate liquidation amount of such trust securities to be redeemed shall be allocated pro rata to the trust preferred securities and the common securities based upon the relative liquidation amounts of such classes, except as set forth below under “— Ranking of Trust Securities.” The property trustee will select the particular trust preferred securities to be redeemed not more than 60 days before the redemption date from the outstanding trust preferred securities not previously called for redemption by any method the property trustee deems fair and appropriate, or, if the trust preferred securities are in book-entry only form, in accordance with the procedures of the depositary. The property trustee shall promptly notify the securities registrar in writing of the trust preferred securities selected for redemption and the liquidation amount to be redeemed. For all purposes of the applicable trust agreement, unless the context otherwise requires, all provisions relating to the redemption of trust preferred securities shall relate, in the case of any trust preferred securities redeemed or to be redeemed only in part, to the portion of the aggregate liquidation amount of trust preferred securities which has been or is to be redeemed.

Notice of any redemption will be mailed at least 30 days but not more than 60 days before the redemption date to the registered address of each holder of trust securities to be redeemed.

Subject to applicable law, including, without limitation, United States federal securities laws, we or our subsidiaries may at any time and from time to time purchase outstanding trust preferred securities by tender, in the open market or by private agreement.

Ranking of Trust Securities

Payment of distributions on, and the redemption price of and the liquidation distribution in respect of, trust preferred securities and common securities, as applicable, shall be made pro rata based on the relative liquidation amount of such trust preferred securities and common securities, except that upon certain events of default under the applicable trust agreement relating to payment defaults on the junior subordinated debt securities, the rights of the holders of the common securities to payment in respect of distributions and payments upon liquidation, redemption and otherwise will be subordinated to the rights of the holders of the trust preferred securities.

In the case of any event of default under a trust agreement resulting from an event of default under the junior subordinated indenture, we, as holder of a trust’s common securities, will be deemed to have waived any right to act with respect to any such event of default under such trust agreement until all such events of default have been cured, waived or otherwise eliminated. Until all events of default under such trust agreement have

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been so cured, waived or otherwise eliminated, the property trustee shall act solely on behalf of the holders of such trust preferred securities and not on our behalf, and only the holders of such trust preferred securities will have the right to direct the property trustee to act on their behalf.

Liquidation Distribution Upon Dissolution

Pursuant to a trust agreement, a trust shall automatically dissolve upon expiration of its term and shall dissolve on the first to occur of:

• certain events of bankruptcy, dissolution or liquidation of Popular or, for Popular North America Capital Trust II and Popular North America Capital Trust III, Popular North America;

• the written direction from us, as holder of the trust’s common securities, to the property trustee to dissolve the trust and distribute a like amount of junior subordinated debt securities to the holders of its trust securities, subject to our having received any required prior approval of the Federal Reserve;

• redemption of all of its trust preferred securities as described above under “— Redemption or Exchange — Mandatory Redemption;” and

• the entry of an order for the dissolution of the trust by a court of competent jurisdiction.

Except as set forth in the next sentence, if an early dissolution occurs as described above, the property trustee will liquidate the trust as expeditiously as possible by distributing, after satisfaction of liabilities to creditors of such trust as provided by applicable law, to the holders of such trust securities a like amount of junior subordinated debt securities. If the property trustee determines that such distribution is not practical or if the early dissolution occurs as a result of the redemption of trust preferred securities, then the holders will be entitled to receive out of the assets of such trust available for distribution to holders and after satisfaction of liabilities to creditors of such trust as provided by applicable law, an amount equal to the aggregate liquidation amount plus accrued and unpaid distributions to the date of payment. If such trust has insufficient assets available to pay in full such aggregate liquidation distribution, then the amounts payable directly by such trust on its trust securities shall be paid on a pro rata basis, except as set forth under “— Ranking of Trust Securities.”

Events of Default; Notice

Any one of the following events constitutes an event of default under the applicable trust agreement, or a “trust event of default,” regardless of the reason for such event of default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body:

• the occurrence of an event of default under the junior subordinated indenture with respect to the junior subordinated debt securities held by such trust (see “Description of Debt Securities We May Offer — Junior Subordinated Debt Securities — Events of Default, Waiver and Notice”); or

• the default by the property trustee in the payment of any distribution on any trust security of such trust when such distribution becomes due and payable, and continuation of such default for a period of 30 days; or

• the default by the property trustee in the payment of any redemption price of any trust security of such trust when such redemption price becomes due and payable; or

• the failure to perform or the breach, in any material respect, of any other covenant or warranty of the trustees in the applicable trust agreement for 90 days after the defaulting trustee or trustees have received written notice of the failure to perform or breach of warranty in the manner specified in such trust agreement; or

• the occurrence of certain events of bankruptcy or insolvency with respect to the property trustee and our failure to appoint a successor property trustee within 90 days.

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Within ten days after any event of default actually known to the property trustee occurs, the property trustee will transmit notice of such event of default to the holders of the trust securities and to the administrative trustees, unless such event of default shall have been cured or waived. We, as depositor, and the administrative trustees are required to file annually with the property trustee a certificate as to whether or not we or they are in compliance with all the conditions and covenants applicable to us and to them under the trust agreement.

The existence of an event of default under the trust agreement, in and of itself, with respect to the junior subordinated debt securities does not entitle the holders of the related trust preferred securities to accelerate the maturity of such junior subordinated debt securities.

Removal of Trustees

Unless an event of default under the junior subordinated indenture has occurred and is continuing, the property trustee and the Delaware trustee of a trust may be removed at any time by the holder of the common securities of such trust. The property trustee and the Delaware trustee may be removed by the holders of a majority in liquidation amount of the outstanding trust preferred securities of such trust for cause or if an event of default under the junior subordinated indenture has occurred and is continuing. In no event will the holders of such trust preferred securities have the right to vote to appoint, remove or replace the administrative trustees, which voting rights are vested exclusively in us, as the holder of the common securities. No resignation or removal of a trustee and no appointment of a successor trustee shall be effective until the acceptance of appointment by the successor trustee in accordance with the provisions of the trust agreement.

Co-Trustees and Separate Property Trustee

Unless an event of default under the junior subordinated indenture shall have occurred and be continuing, at any time or from time to time, for the purpose of meeting the legal requirements of the Trust Indenture Act or of any jurisdiction in which any part of the trust property may at the time be located, we, as the holder of the common securities, and the administrative trustees shall have the power to appoint one or more persons either to act as a co-trustee, jointly with the property trustee, of all or any part of such trust property, or to act as separate trustee of any such property, in either case with such powers as may be provided in the instrument of appointment, and to vest in such person or persons in such capacity any property, title, right or power deemed necessary or desirable, subject to the provisions of such trust agreement. If an event of default under the junior subordinated indenture has occurred and is continuing, the property trustee alone shall have power to make such appointment.

Merger or Consolidation of Trustees

Any person into which the property trustee or the Delaware trustee, if not a natural person, may be merged or converted or with which it may be consolidated, or any person resulting from any merger, conversion or consolidation to which such trustee shall be a party, or any person succeeding to all or substantially all the corporate trust business of such trustee, shall be the successor of such trustee under the trust agreement, provided such person shall be otherwise qualified and eligible.

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Mergers, Consolidations, Amalgamations or Replacements of the Trusts

A trust may not merge with or into, consolidate, amalgamate, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to us or any other person, except as described below or as otherwise described in the applicable trust agreement. Such trust may, at our request, with the consent of the administrative trustees but without the consent of the holders of the trust preferred securities, the property trustee or the Delaware trustee, merge with or into, consolidate, amalgamate, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to, a trust organized as such under the laws of any state, the District of Columbia or the Commonwealth of Puerto Rico if:

• such successor entity either:

• expressly assumes all of the obligations of such trust with respect to the trust preferred securities, or

• substitutes for the trust preferred securities other securities having substantially the same terms as the trust preferred securities, or the “successor securities,” so long as the successor securities rank the same as the trust preferred securities in priority with respect to distributions and payments upon liquidation, redemption and otherwise;

• we expressly appoint a trustee of such successor entity possessing the same powers and duties as the property trustee as the holder of the junior subordinated debt securities;

• such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not cause the trust preferred securities, including any successor securities, to be downgraded by any nationally recognized statistical rating organization;

• such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the holders of the trust preferred securities, including any successor securities, in any material respect;

• such successor entity has a purpose substantially identical to that of such trust;

• prior to such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, we have received an opinion from independent counsel to such trust experienced in such matters to the effect that:

• such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the holders of the trust preferred securities, including any successor securities, in any material respect, and

• following such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, neither such trust nor such successor entity will be required to register as an investment company under the Investment Company Act; and

• we or any permitted successor or assignee owns all of the common securities of such successor entity and guarantees the obligations of such successor entity under the successor securities at least to the extent provided by the applicable guarantee.

Notwithstanding the foregoing, a trust may not, except with the consent of holders of 100% in liquidation amount of its trust preferred securities, consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to any other entity or permit any other entity to consolidate, amalgamate, merge with or into, or replace it if such consolidation, amalgamation, merger, replacement, conveyance, transfer or lease would cause the trust or the successor entity to be classified as other than a grantor trust for United States federal or Puerto Rico income tax purposes.

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Voting Rights; Amendment of the Trust Agreement

Except as provided below and under “— Description of Guarantees — Amendments and Assignment” and as otherwise required by law and the applicable trust agreement, the holders of trust preferred securities will have no voting rights.

We and the administrative trustees may amend a trust agreement without the consent of the holders of its trust preferred securities, unless such amendment will materially and adversely affect the interests of any holder of trust preferred securities, to:

• cure any ambiguity, correct or supplement any provisions in such trust agreement that may be inconsistent with any other provision, or to make any other provisions with respect to matters or questions arising under such trust agreement, which may not be inconsistent with the other provisions of such trust agreement; or

• modify, eliminate or add to any provisions of such trust agreement to such extent as shall be necessary to ensure that such trust will be classified for United States federal or Puerto Rico income tax purposes as a grantor trust at all times that any trust securities are outstanding or to ensure that such trust will not be required to register as an “investment company” under the Investment Company Act.

We, the administrative trustees and the property trustee may generally amend a trust agreement with:

• the consent of holders representing not less than a majority, based upon liquidation amounts, of the outstanding trust preferred securities; and

• receipt by the trustees of an opinion of counsel to the effect that such amendment or the exercise of any power granted to the trustees in accordance with such amendment will not affect such trust’s status as a grantor trust for United States federal or Puerto Rico income tax purposes or the trust’s exemption from status as an “investment company” under the Investment Company Act.

However, without the consent of each holder of trust securities, a trust agreement may not be amended to:

• change the amount or timing of any distribution required to be made in respect of such trust securities as of a specified date; or

• restrict the right of a holder of such trust securities to institute a suit for the enforcement of any such payment on or after such date.

So long as the property trustee of a trust holds any junior subordinated debt securities, the trustees may not, without obtaining the prior approval of the holders of a majority in aggregate liquidation amount of all outstanding trust preferred securities of such trust:

• direct the time, method and place of conducting any proceeding for any remedy available to the junior subordinated trustee, or executing any trust or power conferred on the junior subordinated trustee with respect to such junior subordinated debt securities;

• waive any past default that is waivable under the junior subordinated indenture;

• exercise any right to rescind or annul a declaration that the principal of all the junior subordinated debt securities is due and payable; or

• consent to any amendment, modification or termination of the junior subordinated indenture or such junior subordinated debt securities, where such consent shall be required.

If a consent under the junior subordinated indenture would require the consent of each holder of junior subordinated debt securities affected thereby, no such consent may be given by the property trustee of any trust without the prior consent of each holder of the trust preferred securities of such trust. The property trustee may

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not revoke any action previously authorized or approved by a vote of the holders of the trust preferred securities except by subsequent vote of the holders of the trust preferred securities. The property trustee will notify each holder of the trust preferred securities of any notice of default with respect to the junior subordinated debt securities. In addition to obtaining the foregoing approvals of the holders of the trust preferred securities, before taking any of the foregoing actions, the trustees will obtain an opinion of counsel experienced in such matters to the effect that such action would not cause such trust to be classified as other than a grantor trust for United States federal or Puerto Rico income tax purposes.

Any required approval of holders of trust preferred securities may be given at a meeting of holders of trust preferred securities convened for such purpose or pursuant to written consent. The property trustee will cause a notice of any meeting at which holders of trust preferred securities are entitled to vote, or of any matter upon which action by written consent of such holders is to be taken, to be given to each holder of record of trust preferred securities in the manner set forth in the applicable trust agreement.

No vote or consent of the holders of trust preferred securities will be required for a trust to redeem and cancel its trust preferred securities in accordance with the applicable trust agreement.

Notwithstanding that holders of trust preferred securities are entitled to vote or consent under any of the circumstances described above, any of the trust preferred securities that are owned by us or our affiliates or the trustees or any of their affiliates, shall, for purposes of such vote or consent, be treated as if they were not outstanding.

Payment and Paying Agent

Payments on the trust preferred securities shall be made to the depositary, which shall credit the relevant accounts at the depositary on the applicable distribution dates. If any trust preferred securities are not held by the depositary, such payments shall be made by check mailed to the address of the holder as such address shall appear on the register.

Unless otherwise specified in the applicable prospectus supplement, the paying agent shall initially be Banco Popular de Puerto Rico. The paying agent shall be permitted to resign as paying agent upon 30 days’ written notice to the administrative trustees and to the property trustee. In the event that Banco Popular de Puerto Rico shall no longer be the paying agent, the property trustee will appoint a successor to act as paying agent, which will be a bank or trust company acceptable to the administrative trustees and to us.

Registrar and Transfer Agent

Unless otherwise specified in the applicable prospectus supplement, Banco Popular de Puerto Rico Trust Division will act as registrar and transfer agent for the trust preferred securities.

Registration of transfers of trust preferred securities will be effected without charge by or on behalf of a trust, but upon payment of any tax or other governmental charges that may be imposed in connection with any transfer or exchange. A trust will not be required to register or cause to be registered the transfer of its trust preferred securities after such trust preferred securities have been called for redemption.

Information Concerning the Property Trustee

Other than during the occurrence and continuance of an event of default under the trust agreement, the property trustee undertakes to perform only the duties that are specifically set forth in the applicable trust agreement. After an event of default under the trust agreement, the property trustee must exercise the same degree of care and skill as a prudent individual would exercise or use in the conduct of his or her own affairs. Subject to this provision, the property trustee is under no obligation to exercise any of the powers vested in it by

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the applicable trust agreement at the request of any holder of trust preferred securities unless it is offered indemnity satisfactory to it by such holder against the costs, expenses and liabilities that might be incurred. If no event of default under the trust agreement has occurred and is continuing and the property trustee is required to decide between alternative courses of action, construe ambiguous provisions in such trust agreement or is unsure of the application of any provision of such trust agreement, and the matter is not one upon which holders of trust preferred securities are entitled under the applicable trust agreement to vote, then the property trustee will take any action that we direct. If we do not provide direction, the property trustee may take any action that it deems advisable and in the best interests of the holders of the trust securities and will have no liability except for its own bad faith, negligence or willful misconduct.

We and our affiliates maintain certain accounts and other banking relationships with the property trustee and its affiliates in the ordinary course of business.

Trust Expenses

Pursuant to the applicable trust agreement, we, as depositor, agree to pay:

• all debts and other obligations of the trust (other than with respect to the trust preferred securities);

• all costs and expenses of the trust, including costs and expenses relating to the organization of the trust, the fees and expenses of the trustees and the cost and expenses relating to the operation of the trust; and

• any and all taxes and costs and expenses with respect thereto, other than withholding taxes, to which the trust might become subject.

Governing Law

The trust agreements will be governed by and construed in accordance with the laws of Delaware.

Miscellaneous

The administrative trustees are authorized and directed to conduct the affairs of and to operate the applicable trust in such a way that it will not be required to register as an “investment company” under the Investment Company Act or characterized as other than a grantor trust for United States federal or Puerto Rico income tax purposes. The administrative trustees are authorized and directed to conduct their affairs so that the junior subordinated debt securities will be treated as indebtedness of Popular or Popular North America, as applicable, for Puerto Rico income tax purposes.

In this regard, we and the administrative trustees are authorized to take any action, not inconsistent with applicable law, the certificate of trust of the applicable trust or the applicable trust agreement, that we and the administrative trustees determine to be necessary or desirable to achieve such end, as long as such action does not materially and adversely affect the interests of the holders of the applicable trust preferred securities.

Holders of the trust preferred securities have no preemptive or similar rights.

No trust may borrow money or issue debt or mortgage or pledge any of its assets.

Common Securities

In connection with the issuance of trust preferred securities, the applicable trust will issue one series of common securities. The prospectus supplement relating to such issuance will specify the terms of such common securities, including distributions, redemption, voting and liquidation rights. Except for voting rights, the terms of the common securities will be substantially identical to the terms of the trust preferred securities. The common

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securities will rank equally, and payments will be made on the common securities pro rata, with the trust preferred securities, except as set forth under “Description of Trust Preferred Securities — Ranking of Trust Securities.” Except in limited circumstances, the common securities of a trust carry the right to vote to appoint, remove or replace any of the trustees of that trust. We will own, directly or indirectly, all of the common securities of the trusts.

Description of Guarantees

Set forth below is a summary of information concerning the guarantee that we will execute and deliver for the benefit of the holders of trust preferred securities when a trust issues trust securities. Each trust preferred securities guarantee will be qualified as an indenture under the Trust Indenture Act. The guarantee trustee for purposes of the Trust Indenture Act will be named in the applicable prospectus supplement. The guarantee trustee will hold the trust preferred securities guarantee for the benefit of the holders of the trust preferred securities.

General

Under a trust preferred securities guarantee, we will irrevocably and unconditionally agree to pay in full to the holders of the trust securities, except to the extent paid by the applicable trust, as and when due, regardless of any defense, right of set-off or counterclaim which such trust may have or assert, the following payments, which are referred to as “guarantee payments,” without duplication:

• any accrued and unpaid distributions that are required to be paid on the trust preferred securities, to the extent such trust has funds available for distributions;

• the redemption price, plus all accrued and unpaid distributions relating to any trust preferred securities called for redemption by such trust, to the extent such trust has funds available for redemptions; and

• upon a voluntary or involuntary dissolution, winding-up or termination of such trust, other than in connection with the distribution of junior subordinated debt securities to the holders of trust preferred securities or the redemption of all of the trust preferred securities, the lesser of:

• the aggregate of the liquidation amount and all accrued and unpaid distributions on the trust preferred securities to the date of payment to the extent such trust has funds available; and

• the amount of assets of such trust remaining for distribution to holders of the trust preferred securities in liquidation of such trust.

The redemption price and liquidation amount will be fixed at the time the trust preferred securities are issued.

Our obligation to make a guarantee payment may be satisfied by direct payment of the required amounts to the holders of trust preferred securities or by causing the applicable trust to pay such amounts to such holders.

A trust preferred securities guarantee will not apply to any payment of distributions except to the extent a trust shall have funds available for such payments. If we do not make interest payments on the junior subordinated debt securities purchased by a trust, such trust will not pay distributions on the trust preferred securities and will not have funds available for such payments. See “— Status of the Guarantees” below. Because we are a holding company, our rights to participate in the assets of any of our subsidiaries upon the subsidiary’s liquidation or reorganization will be subject to the prior claims of the subsidiary’s creditors except to the extent that we may ourselves be a creditor with recognized claims against the subsidiary. Except as otherwise described in the applicable prospectus supplement, the trust preferred securities guarantees do not limit the incurrence or issuance by us of other secured or unsecured debt.

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A trust preferred securities guarantee, when taken together with our obligations under the junior subordinated debt securities, the junior subordinated indenture and the applicable trust agreement, including our obligations to pay costs, expenses, debts and liabilities of the applicable trust, other than those relating to trust securities, will provide a full and unconditional guarantee on a subordinated basis of payments due on the trust preferred securities.

Unless otherwise specified in the applicable prospectus supplement, we will also agree separately to irrevocably and unconditionally guarantee the obligations of each trust with respect to the common securities to the same extent as the trust preferred securities guarantees.

Status of the Guarantees

A guarantee will be unsecured and will rank:

• subordinate and junior in right of payment to all our other liabilities in the same manner as the junior subordinated debt securities as set forth in the junior subordinated indenture; and

• equally with all other trust preferred security guarantees that we issue.

A guarantee will constitute a guarantee of payment and not of collection, which means that the guaranteed party may sue the guarantor to enforce its rights under the guarantee without suing any other person or entity. A guarantee will be held by the guarantee trustee for the benefit of the holders of the related trust securities. A guarantee will be discharged only by payment of the guarantee payments in full to the extent not paid by the trust or upon the distribution of the junior subordinated debt securities.

Amendments and Assignment

A trust preferred securities guarantee may be amended only with the prior approval of the holders of not less than a majority in aggregate liquidation amount of the outstanding relevant trust preferred securities. No vote will be required, however, for any changes that do not adversely affect the rights of holders of such trust preferred securities in any material respect. All guarantees and agreements contained in a trust preferred securities guarantee will bind our successors, assignees, receivers, trustees and representatives and will be for the benefit of the holders of the trust preferred securities then outstanding.

Termination of the Guarantees

A trust preferred securities guarantee will terminate (1) upon full payment of the redemption price of all related trust preferred securities, (2) upon distribution of the junior subordinated debt securities to the holders of the related trust securities or (3) upon full payment of the amounts payable in accordance with the applicable trust agreement upon liquidation of the trust. A trust preferred securities guarantee will continue to be effective or will be reinstated, as the case may be, if at any time any holder of trust preferred securities must restore payment of any sums paid under the trust preferred securities or the trust preferred securities guarantee.

Events of Default

An event of default under a trust preferred securities guarantee will occur if we fail to perform any payment obligation or other obligation under such guarantee.

The holders of a majority in liquidation amount of the trust preferred securities of a trust have the right to direct the time, method and place of conducting any proceeding for any remedy available to the guarantee trustee of such trust in respect of the applicable trust preferred securities guarantee or to direct the exercise of any trust or power conferred upon the guarantee trustee under the guarantee. Any holder of trust preferred securities may

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institute a legal proceeding directly against us to enforce the guarantee trustee’s rights and our obligations under the applicable trust preferred securities guarantee, without first instituting a legal proceeding against such trust, the guarantee trustee or any other person or entity.

As guarantor, we are required to file annually with the guarantee trustee a certificate as to whether or not we are in compliance with all applicable conditions and covenants under the trust preferred securities guarantee.

Information Concerning the Guarantee Trustee

Prior to the occurrence of an event of default relating to a trust preferred securities guarantee, the guarantee trustee is required to perform only the duties that are specifically set forth in such trust preferred securities guarantee. Following the occurrence of an event of default, the guarantee trustee will exercise the same degree of care as a prudent individual would exercise in the conduct of his or her own affairs. Provided that the foregoing requirements have been met, the guarantee trustee is under no obligation to exercise any of the powers vested in it by the trust preferred securities guarantee at the request of any holder of trust preferred securities unless offered indemnity satisfactory to it against the costs, expenses and liabilities which might be incurred thereby.

We and our affiliates maintain certain accounts and other banking relationships with the guarantee trustee and its affiliates in the ordinary course of business.

Governing Law

The trust preferred securities guarantees will be governed by and construed in accordance with the internal laws of the Commonwealth of Puerto Rico.

Relationship Among Trust Preferred Securities

Junior Subordinated Debt Securities And Guarantees

As set forth in the applicable trust agreement, the sole purpose of a trust is to issue the trust securities and to invest the proceeds in junior subordinated debt securities.

As long as payments of interest and other payments are made when due on a series of junior subordinated debt securities, those payments will be sufficient to cover the distributions and payments due on the related trust securities. This is due to the following factors:

• the aggregate principal amount of such junior subordinated debt securities will be equal to the sum of the aggregate stated liquidation amount of such trust securities;

• the interest rate and the interest and other payment dates on such junior subordinated debt securities will match the distribution rate and distribution and other payment dates for such trust securities;

• under the junior subordinated indenture, we will pay, and the applicable trust will not be obligated to pay, directly or indirectly, all costs, expenses, debts and obligations of such trust, other than those relating to such trust securities; and

• the applicable trust agreement further provides that the trustees may not cause or permit the trust to engage in any activity that is not consistent with the purposes of the trust.

To the extent that funds are available, we guarantee payments of distributions and other payments due on trust preferred securities to the extent described in this prospectus. If we do not make interest payments on a series of junior subordinated debt securities, the related trust will not have sufficient funds to pay distributions on the trust preferred securities. A trust preferred securities guarantee is a subordinated guarantee in relation to the

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trust preferred securities. A trust preferred securities guarantee does not apply to any payment of distributions unless and until such trust has sufficient funds for the payment of such distributions. See “— Description of Guarantees above”.

We have the right to set off any payment that we are otherwise required to make under the junior subordinated indenture with any payment that we have previously made or are concurrently on the date of such payment making under a related guarantee.

A trust preferred securities guarantee covers the payment of distributions and other payments on the trust preferred securities of a trust only if and to the extent that we have made a payment of interest or principal or other payments on the junior subordinated debt securities. A trust preferred securities guarantee, when taken together with our obligations under the junior subordinated debt securities and the junior subordinated indenture and our obligations under the applicable trust agreement, will provide a full and unconditional guarantee of distributions, redemption payments and liquidation payments on the related trust preferred securities.

If we fail to make interest or other payments on the junior subordinated debt securities when due, taking account of any extension period, the applicable trust agreement allows the holders of the related trust preferred securities to direct the property trustee to enforce its rights under the junior subordinated debt securities. If the property trustee fails to enforce these rights, any holder of such trust preferred securities may directly sue us to enforce such rights without first suing the property trustee or any other person or entity. See “— Trust Preferred Securities — Voting Rights; Amendment of the Trust Agreement.”

A holder of trust preferred securities may institute a direct action if we fail to make interest or other payments on the junior subordinated debt securities when due, taking account of any extension period. A direct action may be brought without first:

• directing the property trustee to enforce the terms of the junior subordinated debt securities, or

• suing us to enforce the property trustee’s rights under the junior subordinated debt securities. In connection with such direct action, we will be subrogated to the rights of such holder of trust preferred securities under the applicable trust agreement to the extent of any payment made by us to such holder of trust preferred securities. Consequently, we will be entitled to payment of amounts that a holder of trust preferred securities receives in respect of an unpaid distribution to the extent that such holder receives or has already received full payment relating to such unpaid distribution from such trust.

We acknowledge that the guarantee trustee will enforce the trust preferred securities guarantees on behalf of the holders of the trust preferred securities. If we fail to make payments under the trust preferred securities guarantee, the holders of the related trust preferred securities may direct the guarantee trustee to enforce its rights under such guarantee. If the guarantee trustee fails to enforce the trust preferred securities guarantee, any holder of trust preferred securities may directly sue us to enforce the guarantee trustee’s rights under the trust preferred securities guarantee. Such holder need not first sue the trust, the guarantee trustee, or any other person or entity. A holder of trust preferred securities may also directly sue us to enforce such holder’s right to receive payment under the trust preferred securities guarantees. Such holder need not first direct the guarantee trustee to enforce the terms of the trust preferred securities guarantee or sue such trust or any other person or entity.

We and each trust believe that the above mechanisms and obligations, taken together, are equivalent to a full and unconditional guarantee by us of payments due on the trust preferred securities. See “— Description of Guarantees — General.”

Limited Purpose of Trust

Each trust’s preferred securities evidence a beneficial interest in the assets such trust, and such trust exists for the sole purpose of issuing its trust preferred securities and common securities and investing the proceeds in junior subordinated debt securities issued by Popular or Popular North America, as applicable. A principal

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difference between the rights of a holder of a trust preferred security and a holder of a junior subordinated debt security is that a holder of a junior subordinated debt security is entitled to receive from us the principal amount of and interest accrued on such junior subordinated debt securities, while a holder of trust preferred securities is entitled to receive distributions from such trust, or from us under the related guarantee, if and to the extent such trust has funds available for the payment of such distributions.

Rights Upon Dissolution

Upon any voluntary or involuntary dissolution, winding up or liquidation of a trust involving the liquidation of the junior subordinated debt securities, after satisfaction of liabilities to creditors of such trust, the holders of the trust preferred securities of such trust will be entitled to receive, out of the assets held by such trust, the liquidation distribution in cash. See “— Trust Preferred Securities — Liquidation Distribution Upon Dissolution.” Upon any voluntary or involuntary liquidation or bankruptcy of Popular or Popular North America, as applicable, the property trustee, as holder of the junior subordinated debt securities, would be a subordinated creditor of Popular or Popular North America, as applicable, subordinated in right of payment to all Senior Debt as set forth in the junior subordinated indenture, but entitled to receive payment in full of principal and interest before any of our stockholders receive distributions. Since we are the guarantor under the guarantee and have agreed to pay for all costs, expenses and liabilities of each trust, other than such trust’s obligations to the holders of its trust preferred securities, the positions of a holder of such trust preferred securities and a holder of such junior subordinated debt securities relative to other creditors and to our stockholders in the event of liquidation or bankruptcy are expected to be substantially the same.

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DESCRIPTION OF CAPITAL STOCK

Capital Stock

Our authorized capital stock consists of 170,000,000 shares of common stock, par value $0.01 per share, and 30,000,000 shares of preferred stock, without par value. The preferred stock is issuable in one or more series, with such terms, and at such times and for such consideration as our Board of Directors determines. As of June 1, 2012, there were issued and outstanding 102,789,713 shares of common stock and 2,006,391 shares of preferred stock. The preferred stock is divided into two series with an aggregation liquidation of $50 million. Shares of our common stock are traded on the NASDAQ Global Select Market under the symbol “BPOP.” Shares of our 6.375% Non-Cumulative Monthly Income Preferred Stock, 2003, Series A and 8.25% Non-Cumulative Monthly Income Preferred Stock, Series B are not publicly traded.

The following description summarizes the material provisions of our common stock. It does not purport to be complete and is subject in all respects to the applicable provisions of the Puerto Rico General Corporations Law, our Certificate of Incorporation (the “Certificate”), and the Certificates of Designation describing each series of preferred stock.

Common Stock

Subject to the rights of holders of any preferred stock outstanding, holders of our common stock are entitled to receive ratably such dividends, if any, as our Board of Directors may in its discretion declare out of legally available funds.

The holders of our common stock are entitled to one vote per share on all matters brought before the stockholders. The holders of our common stock do not have the right to cumulate their shares of our common stock in the election of directors. The Certificate provides that the approval of our merger, reorganization, or consolidation or the sale, lease or hypothecation of substantially all of our assets or the approval of our voluntary dissolution requires the vote of the holders of 75% of the total number of our outstanding shares of common stock.

In the event of our liquidation, holders of our common stock will be entitled to receive pro rata any assets distributable to stockholders with respect to the shares held by them, after payment of liabilities and such preferential amounts as may be required to be paid to the holders of our outstanding series of preferred stock and any preferred stock we hereafter issue.

The Certificate provides that the members of our Board of Directors are divided into three classes as nearly equal as possible. Each class is elected for a three-year term. At each annual meeting of stockholders, one-third of the members of our Board of Directors will be elected for a three-year term, and the other directors will remain in office until their three-year terms expire. Therefore, control of our Board of Directors cannot be changed in one year, and at least two annual meetings must be held before a majority of the members of our Board of Directors can be changed.

The Certificate provides that a director, or the entire Board of Directors, may be removed by the stockholders only for cause. The Certificate and our Bylaws also provide that the affirmative vote of the holders of at least two-thirds of the combined voting power of the outstanding capital stock entitled to vote generally for the election of directors is required to remove a director or the entire Board of Directors from office for cause or to amend the Certificate. Certain portions of the Certificate described in certain of the preceding paragraphs, including those related to the classified Board of Directors, may be amended only by the affirmative vote of the holders of two-thirds of the total number of our outstanding shares of common stock.

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Certain of the provisions contained in the Certificate have the effect of making it more difficult to change our Board of Directors, and may make our Board of Directors less responsive to stockholder control. These provisions also may tend to discourage attempts by third parties to acquire us because of the additional time and expense involved and a greater possibility of failure, and, as a result, may adversely affect the price that a potential purchaser would be willing to pay for our capital stock, thereby reducing the amount a stockholder might realize in, for example, a tender offer for our capital stock.

Pursuant to the Certificate, holders of our common stock are entitled to preferential rights to subscribe for newly issued shares of our common stock on a pro rata basis unless, in approving the issuance of our common stock, or any transaction resulting in the issuance of any of our common stock, our Board of Directors unanimously resolves otherwise. The stockholders have no preference to subscribe therefor in the event of new issues of shares of stock which may be authorized pursuant to any dividend reinvestment and stock purchase plan or which may be authorized in order to exchange such new shares of stock for property which our Board of Directors may consider convenient or necessary for us to acquire, nor shall the stockholders have any right of preference therefor in the event of new issues of stock in payment of services rendered to us, or of shares of stock to be issued for sale to officers or employees, on the basis of options, as an incentive either to commence or to continue rendering services to us. There are no redemption or call provisions applicable to shares of our common stock.

The outstanding shares of our common stock are, and shares of our common stock offered hereby upon their due issuance, delivery and the receipt of payment therefor will be, validly issued, fully paid and nonassessable.

The Registrar and Transfer Agent for our common stock is Banco Popular de Puerto Rico.

Preferred Stock

Our Board of Directors is authorized to provide for the issuance of shares of preferred stock in one or more series, with such voting powers, full or limited but not to exceed one vote per share, or without voting powers, and with such designations, preferences and relative participating, optional or other special rights, and qualifications, limitations or restrictions thereof, as shall be expressed in the resolution or resolutions providing for the issuance thereof to be adopted by our Board of Directors, except as otherwise provided in the Certificate or any amendment thereto.

The issuance of shares of preferred stock could make it more difficult and more expensive for another person or entity to obtain control of us in a merger, tender offer, proxy fight or similar transaction. The ability of our Board of Directors to issue shares of preferred stock in such a situation could have the effect of discouraging a potential acquiror and may have an adverse effect on stockholders wishing to participate in a merger, tender offer or proxy fight. Our management is not aware of any person or entity currently seeking control of us.

We have two outstanding series of preferred stock, which are described below.

Title of Series

Number of Shares Outstanding

Annual Dividend Rate(1)

Liquidation Preference Per Share(2)

Accumulation of Dividends

Date First Redeemable(3)

Conversion or Exchange Rights

General Voting Rights(4)

6.375% Non-Cumulative Monthly Income Preferred Stock, 2003 Series A (the “6.375% Preferred Stock”)

885,726

6.375

%

$

25

Non-cumulative

March 31, 2008

None

No

8.25% Non-Cumulative Monthly Income Preferred Stock, Series B (the “8.25% Preferred Stock”)

1,120,665

8.25

%

$

25

Non-cumulative

May 28, 2013

None

No

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⁽¹⁾  Based on a percentage of the applicable liquidation preference per share.

⁽²⁾  See “Liquidation Rights” below for additional information.

⁽³⁾  See “Redemption” below for additional information.

⁽⁴⁾  See “Voting Rights” below for additional information.

Dividend Rights and Limitations

The holders of the shares of 6.375% Preferred Stock and the 8.25% Preferred Stock are entitled to receive noncumulative cash dividends when, as and if declared by the Board of Directors, at their respective annual dividend rates, payable monthly. The holders of each of the two series of preferred stock are entitled to receive such dividends prior to any payment of dividends or distribution of assets to holders of the common stock and to any other class of capital stock ranking junior to the 6.375% Preferred Stock and the 8.25% Preferred Stock with respect to the payment of dividends.

Liquidation Rights

In the event of our liquidation, dissolution or winding up, whether voluntary or involuntary, the holders of the 6.375% Preferred Stock and the 8.25% Preferred Stock are entitled to receive out of the remaining assets an amount in cash equal to their liquidation preference per share plus accrued and unpaid dividends thereon (limited to the then current monthly dividend period in the case of the two series that are non-cumulative) to date of the distribution. This distribution must be made before any payment may be made to the holders of our common stock or any other securities ranking junior to the 6.375% Preferred Stock or the 8.25% Preferred Stock as to the distribution of assets upon liquidation. No distribution of this type or payment on account of our liquidation, dissolution or winding up may be made to the holders of the shares of any class or series of stock ranking on a parity with the 6.375% Preferred Stock or the 8.25% Preferred Stock as to the distribution of assets upon liquidation, unless the holders of each of such series of Preferred Stock receive like amounts ratably in accordance with the full distributive amounts which they and the holders of parity stock are respectively entitled to receive upon this preferential distribution.

After the payment to the holders of the 6.375% Preferred Stock and the 8.25% Preferred Stock of the full preferential amounts provided for above, the holders of such shares will have no right or claim to any of the remaining assets.

Redemption

The 6.375% Preferred Stock is subject to redemption in whole or in part at a redemption price equal to $25.

The 8.25% Preferred Stock is subject to redemption in whole or in part, commencing on or after May 28, 2013, and prior to May 29, 2014 at a redemption price of $25.50 per share and after this period at redemption prices declining to $25 per share on or after May 29, 2015.

Optional redemption of any of the two series of Preferred Stock by Popular is subject to the prior approval of the Federal Reserve.

There is no mandatory redemption or sinking fund obligation with respect to either the 6.375% Preferred Stock or the 8.25% Preferred Stock.

Voting Rights

The holders of shares of 6.375% Preferred Stock and the 8.25% Preferred Stock are not entitled to any voting rights except (1) if we do not pay dividends in full on such series for 18 monthly dividend periods, whether or not consecutive, (2) as required by law or (3) in connection with any changes of the terms or rights of the 6.375% Preferred Stock or the 8.25% Preferred Stock, as the case may be.

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USE OF PROCEEDS

We intend to use the net proceeds from the sales of the securities as set forth in the applicable prospectus supplement.

RATIO OF EARNINGS TO FIXED CHARGES AND

RATIO OF EARNINGS TO COMBINED FIXED CHARGES

INCLUDING PREFERRED STOCK DIVIDENDS

The following table shows (1) the consolidated ratio of earnings to fixed charges and (2) the consolidated ratio of earnings to combined fixed charges including preferred stock dividends of Popular for each of the five most recent fiscal years and the three months ended March 31, 2012.

	Three Months Ended March  31, 2012	Year Ended December 31,
		2011		2010		2009(1)		2008(1)		2007(1)
Ratio of earnings to fixed charges
Including Interest on Deposits	1.6		1.5		1.4		(A)		(A)		1.2
Excluding Interest on Deposits	2.2		2.0		1.7		(A)		(A)		1.5
Ratio of earnings to combined fixed charges including preferred stock dividends
Including Interest on Deposits	1.6		1.4		1.4		(A)		(A)		1.2
Excluding Interest on Deposits	2.1		1.9		1.7		(A)		(A)		1.5

⁽¹⁾  The computation of earnings to fixed charges and preferred stock dividends excludes discontinued operations. Prior periods have been retrospectively adjusted on a comparable basis.

^(A)  During 2008 and 2009, earnings were not sufficient to cover fixed charges or preferred stock dividends and the ratios were less than 1:1. Popular would have had to generate additional earnings of approximately $235 million and $625 million to achieve ratios of 1:1 in 2008 and 2009, respectively.

VALIDITY OF THE SECURITIES

In connection with particular offerings of the securities in the future, and if stated in the applicable prospectus supplements, the validity of the securities may be passed upon for us by Ignacio Alvarez, our Executive Vice President and Chief Legal Officer, or by Sullivan & Cromwell LLP, New York, New York or such other counsel as may be named in the applicable prospectus supplement and for any underwriters or agents by counsel named in the applicable prospectus supplement. As of June 15, 2012, Mr. Alvarez owned directly or indirectly approximately 40,223 shares of Popular, Inc. common stock pursuant to Popular, Inc.’s employee stock ownership plan and otherwise.

EXPERTS

The financial statements and management’s assessment of the effectiveness of the internal control over financial reporting (which is included in Management’s Report to Stockholders) incorporated in this prospectus by reference to Popular, Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

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PART II

Information Not Required in Prospectus

Item 14. Other Expenses of Issuance and Distribution

The estimated expenses, other than underwriting or broker-dealer fees, discounts and commissions, in connection with the offering are as follows:

	Amount to be paid
SEC registration fee	$	*
NASD fees		**
Legal fees and expenses		**
Fees and expenses of qualification under state securities laws (including legal fees)		**
Accounting fees and expenses		**
Printing fees		**
Rating agency fees		**
Trustee’s fees and expenses		**
Miscellaneous		**
Total	$	**

* Deferred pursuant to Rules 456 and 457.

** These fees are calculated based on the securities offered and the number of issuances, and accordingly cannot be estimated at this time.

Item 15. Indemnification of Directors and Officers

a) Article ELEVENTH of the Certificate of Incorporation of Popular, Inc. provides the following:

(1) The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation) by reason of the fact that he is or was a director, officer, employee or agent of the Corporation, or is or was serving at the written request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interest of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Corporation and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful.

(2) The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the Corporation, or is or was serving at the written request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, except that no indemnification

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shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the Corporation unless and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper.

(3) To the extent that a director, officer, employee or agent of the Corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in paragraph 1 or 2 of this Article ELEVENTH, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection therewith.

(4) Any indemnification under paragraph 1 or 2 of this Article ELEVENTH (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he has met the applicable standard of conduct set forth therein. Such determination shall be made (a) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (b) if such a quorum is not obtainable, or, even if obtainable, a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (c) by the stockholders.

(5) Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the Corporation in advance of the final disposition of such action, suit or proceeding as authorized by the Board of Directors in the specific case upon receipt of an undertaking by or on behalf of the director, officer, employee or agent to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the Corporation as authorized in this Article ELEVENTH.

(6) The indemnification provided by this Article ELEVENTH shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under any statute, by-law, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person.

(7) By action of its Board of Directors, notwithstanding any interest of the directors in the action, the Corporation may purchase and maintain insurance, in such amounts as the Board of Directors deems appropriate, on behalf of any person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the written request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against him and incurred by him in any such capacity, or arising out of this status as such, whether or not the Corporation would have the power or would be required to indemnify him against such liability under the provisions of this Article ELEVENTH or of the General Corporation Law of the Commonwealth of Puerto Rico or of any other State of the United States or foreign country as may be applicable.

b) Article 1.02(b)(6) of the Puerto Rico General Corporation Act (the “PR-GCA”) provides that a corporation may include in its certificate of incorporation a provision eliminating or limiting the personal liability of members of its board of directors or governing body for breach of a director’s fiduciary duty of care. However, no such provision may eliminate or limit the liability of a director for breaching his duty of loyalty, failing to act in good faith, engaging in intentional misconduct or knowingly violating a law, paying an unlawful dividend or approving an unlawful stock repurchase or obtaining an improper personal benefit.

c) Article 4.08 of the PR-GCA authorizes a Puerto Rico corporation to indemnify its officers and directors against liabilities arising out of pending or threatened actions, suits or proceedings to which such officers and

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directors may be made parties by reason of being officers or directors. Such rights of indemnification are not exclusive of any other rights to which such officers or directors may be entitled under any by-law, agreement, vote of stockholders or otherwise.

d) Popular, Inc. maintains directors’ and officers’ liability insurance.

Item 16. Exhibits

Exhibit No.	Description	Incorporated by Reference to Filings Indicated
1.1	Form of Underwriting Agreement	*
4.1	Form of certificate representing Popular, Inc.’s common stock, par value $0.01 per share	Incorporated by reference to Exhibit 4.1 of Popular, Inc.’s Form 8-K dated May 29, 2012 and filed May 30, 2012
4.2	Senior Indenture of Popular, Inc., dated as of February 15, 1995, as supplemented by the First Supplemental Indenture thereto, dated as of May 8, 1997, each between Popular, Inc. and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4(d) of Popular, Inc.’s Registration Statement on Form S-3 (File No. 333-26941) filed on May 12, 1997
4.3	Second Supplemental Indenture of Popular, Inc., dated as of August 5, 1999, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4(e) of Popular, Inc.’s Form 8-K dated August 5, 1999 and filed August 17, 1999
4.4	Third Supplemental Indenture of Popular, Inc., dated as of September 10, 2008, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 99.1 of Popular, Inc.’s Form 8-K dated September 16, 2008 and filed on September 16, 2008
4.5	Subordinated Indenture of Popular, Inc., dated as of November 30, 1995, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4(e) of Popular, Inc.’s Registration Statement on Form S-3 (File No. 333-26941) filed on May 12, 1997
4.6	Senior Indenture of Popular North America, Inc., dated as of October 1, 1991, as supplemented by the First Supplemental Indenture thereto, dated as of February 28, 1995, and by the Second Supplemental Indenture thereto, dated as of May 8, 1997, each among Popular North America, Inc., Popular, Inc., as guarantor, and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4(f) of Popular, Inc.’s Registration Statement on Form S-3 (File No. 333-26941) filed on May 12, 1997

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Exhibit No.	Description	Incorporated by Reference to Filings Indicated
4.7	Third Supplemental Indenture of Popular North America, Inc., dated as of August 5, 1999, among Popular North America, Inc., Popular, Inc., as guarantor, and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4(h) of Popular, Inc.’s Form 8-K dated August 5, 1999 and filed on August 17, 1999
4.8	Indenture dated as of October 31, 2003, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4.2 of Popular, Inc.’s Current Report on Form 8-K, filed on November 4, 2003
4.9	First Supplemental Indenture, dated as of October 31, 2003, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4.3 of Popular, Inc.’s Current Report on Form 8-K filed on November 4, 2003
4.10	Form of Junior Subordinated Indenture among Popular North America, Inc., Popular, Inc. and The Bank of New York Mellon, as successor trustee	**
4.11	Second Supplemental Indenture, dated as of November 30, 2004, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	Incorporated by reference to Exhibit 4.3 of Popular, Inc.’s Current Report on Form 8-K filed on December 3, 2004
4.12	Form of Certificate of Junior Subordinated Debenture	Incorporated by reference to Exhibit 4.2 of Popular, Inc.’s Registration Statement on Form S-3 filed on November 10, 2004 (File No. 333-120340)
4.13	Certificate of Trust of Popular Capital Trust IV	Incorporated by reference to Exhibit 4.3 to Popular, Inc.’s Registration Statement on Form S-3 filed on September 5, 2003 (File No. 333-108559)
4.14	Declaration of Trust and Trust Agreement of Popular Capital Trust IV	Incorporated by reference to Exhibit 4.4 to Popular, Inc.’s Registration Statement on Form S-3 filed on September 5, 2003 (File No. 333-108559)

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Exhibit No.	Description	Incorporated by Reference to Filings Indicated
4.15	Certificate of Amendment to Certificate of Trust of Popular Capital Trust IV	**
4.16	Form of Amended and Restated Declaration of Trust and Trust Agreement for Popular Capital Trust IV	Incorporated by reference to Exhibit 4.5 of Popular, Inc.’s Registration Statement on Form S-3 filed on November 10, 2004 (File No. 333-120340)
4.17	Form of Preferred Security Certificate for Popular Capital Trust IV	Incorporated by reference to Exhibit 4.5 of Popular, Inc.’s Registration Statement on Form S-3 filed on November 10, 2004 (File No. 333-120340)
4.18	Form of Guarantee Agreement for Popular Capital Trust IV	Incorporated by reference to Exhibit 4.7 of Popular, Inc.’s Registration Statement on Form S-3 filed on November 10, 2004 (File No. 333-120340)
4.19	Certificate of Trust of Popular North America Capital Trust II and Popular North America Capital Trust III	Incorporated by reference to Exhibit 4.22 of Popular, Inc.’s Registration Statement on Form S-3 filed on June 16, 2006 (File No. 333-135093)
4.20	Declaration of Trust and Trust Agreement of each of Popular North America Capital Trust II and Popular North America Capital Trust III	**
4.21	Form of Amended and Restated Trust Agreement for Popular North America Capital Trust II and Popular North America Capital Trust III	**
4.22	Form of Capital Security Certificate for each of Popular North America Capital Trust II and Popular North America Capital Trust III	Included as Exhibit E to the Form of Amended and Restated Trust Agreement of Popular North America Capital Trust II and Popular North America Capital Trust III, filed herewith as Exhibit 4.21
4.23	Form of Form of Guarantee Agreement for Popular North America Capital Trust II and Popular North America Capital Trust III	**
4.24	Certificate of Amendment to Certificate of Trust of each of Popular North America Capital Trust II and Popular North America Capital Trust III	**
5.1	Opinion of Ignacio Alvarez, Executive Vice President & Chief Legal Officer, as to validity	**
5.2	Opinion of Sullivan & Cromwell LLP, as to validity	**
5.3	Form of opinion of Richards, Layton & Finger, P.A., special Delaware counsel to the Trusts, as to the validity of the Trust Preferred Securities to be issued by the Trusts	*

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Exhibit No.	Description	Incorporated by Reference to Filings Indicated
12.1	Statement of Computation of Ratio of Earnings to Fixed Charges and of Earnings to Combined Fixed Charges Including Preferred Stock Dividends	Incorporated by reference to Exhibit 12.1 of Popular’s Current Report on Form 10-Q for the quarterly period ended March 31, 2012
23.1	Consent of PricewaterhouseCoopers LLP	**
23.2	Consent of Ignacio Alvarez (included in Exhibit 5.1)
23.3	Consent of Sullivan & Cromwell LLP (included in Exhibit 5.2)
23.4	Consent of Richards, Layton & Finger, P.A. (to be included in Exhibit 5.3)	*
24.1	Power of Attorney (included on signature page)
25.1	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as successor trustee, under the Senior Indenture, dated as of February 15, 1995, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	**
25.2	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as successor trustee, under the Subordinated Indenture, dated as of November 30, 1995, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	**
25.3	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as successor trustee, under the Senior Indenture, dated as of October 1, 1991, among Popular North America, Inc., as issuer, Popular, Inc., as guarantor, and The Bank of New York Mellon, as successor trustee	**
25.4	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as successor trustee, under the Indenture, dated as of October 31, 2003, between Popular, Inc. and The Bank of New York Mellon, as successor trustee	**
25.5	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as trustee, with respect to the form of Junior Subordinated Indenture, among Popular North America, Inc., as issuer, Popular, Inc., as guarantor, and The Bank of New York Mellon, as trustee	**

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Exhibit No.	Description	Incorporated by Reference to Filings Indicated
25.6	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as property trustee, with respect to the form of Amended and Restated Declaration of Trust and Trust Agreement for Popular Capital Trust IV	**
25.7	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as guarantee trustee, with respect to the form of Guarantee Agreement of Popular, Inc. with respect to the Capital Securities of Popular Capital Trust IV	**
25.8	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as property trustee, with respect to the form of Amended and Restated Trust Agreement for Popular North America Capital Trust II	**
25.9	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as guarantee trustee, with respect to the form of Guarantee Agreement of Popular, Inc. with respect to the Capital Securities of Popular North America Capital Trust II	**
25.10	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as property trustee, with respect to the form of Amended and Restated Trust Agreement for Popular North America Capital Trust III	**
25.11	Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York Mellon, as guarantee trustee, with respect to the form of Guarantee Agreement of Popular, Inc. with respect to the Capital Securities of Popular North America Capital Trust III	**

* To be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference.

** Filed herewith.

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Item 17. Undertakings

The undersigned Registrant hereby undertakes:

(a) (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

provided, however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not apply if the registration statement is on Form S-3, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(b) The undersigned Registrant hereby undertakes that, for purposes of determining liability under the Securities Act of 1933 to any purchaser, (i) each prospectus filed by the Registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and (ii) each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of the registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(l)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which the prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

II-8

(c) The undersigned Registrant hereby undertakes that, for purposes of determining the liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: (i) any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; (ii) any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; (iii) the portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and (iv) any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

(d) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant’s Annual Report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(e) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by the Registrant is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

II-9

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the undersigned Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on the 19th day of June, 2012.

POPULAR, INC.
By:	/s/ JORGE A. JUNQUERA
	Name:	JORGE A. JUNQUERA
	Title:	Senior Executive Vice President and Chief Financial Officer

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Richard L. Carrión, Jorge A. Junquera, Richard Barrios and Ignacio Alvarez each of them individually, his true and lawful attorney-in-fact and agent, with full power in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement, and to file such amendments or supplements, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitutes or substitute, may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities indicated:

Signature	Title	Date
/s/ RICHARD L. CARRIÓN Richard L. Carrión	Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer)	June 19, 2012
/s/ ALEJANDRO M. BALLESTER Alejandro M. Ballester	Director	June 19, 2012
/S/ MARÍA LUISA FERRÉ María Luisa Ferré	Director	June 19, 2012
/s/ DAVID E. GOEL David E. Goel	Director	June 19, 2012
/s/ C. KIM GOODWIN C. Kim Goodwin	Director	June 19, 2012
/s/ MANUEL MORALES, JR. Manuel Morales, Jr.	Director	June 19, 2012

II-10

/s/ WILLIAM J. TEUBER, JR. William J. Teuber, Jr.	Director	June 19, 2012
/s/ CARLOS A. UNANUE Carlos A. Unanue	Director	June 19, 2012
/s/ JOSÉ R. VIZCARRONDO José R. Vizcarrondo	Director	June 19, 2012
/s/ JORGE A. JUNQUERA Jorge A. Junquera	Senior Executive Vice President and Chief Financial Officer (Principal Financial Officer)	June 19, 2012
/s/ JORGE J. GARCÍA Jorge J. García	Senior Vice President and Comptroller (Principal Accounting Officer)	June 19, 2012

Pursuant to the requirements of the Securities Act of 1933, Popular Capital Trust IV certify that it has reasonable grounds to believe that it meets all the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on the 19th day of June, 2012.

POPULAR CAPITAL TRUST IV (Co-registrant)
By:	POPULAR, INC. AS DEPOSITOR
By:	/s/ JORGE A. JUNQUERA
	Name:	Jorge A. Junquera
	Title:	Senior Executive Vice President

Pursuant to the requirements of the Securities Act of 1933, the undersigned Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on the 19th day of June, 2012.

POPULAR NORTH AMERICA, INC.
By:	/S/ JORGE A. JUNQUERA
	Name:	Jorge A. Junquera
	Title:	Senior Executive Vice President

II-11

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Richard L. Carrión, Jorge A. Junquera, Richard Barrios and Ignacio Alvarez each of them individually, his true and lawful attorney-in-fact and agent, with full power in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement, and to file such amendments or supplements, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitutes or substitute, may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities indicated:

Signature	Title	Date
/s/ RICHARD L. CARRIÓN Richard L. Carrión	Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer)	June 19, 2012
/s/ JORGE A. JUNQUERA Jorge A. Junquera	Senior Executive Vice President, Director	June 19, 2012
/s/ CARLOS J. VÁZQUEZ Carlos J. Vázquez	Director	June 19, 2012
/s/ ALEJANDRO M. BALLESTER Alejandro M. Ballester	Director	June 19, 2012
/s/ MARÍA LUISA FERRÉ María Luisa Ferré	Director	June 19, 2012
/s/ DAVID E. GOEL David E. Goel	Director	June 19, 2012
/s/ C. KIM GOODWIN C. Kim Goodwin	Director	June 19, 2012
/s/ MANUEL MORALES, JR. Manuel Morales, Jr.	Director	June 19, 2012
/s/ WILLIAM J. TEUBER, JR. William J. Teuber, Jr.	Director	June 19, 2012
/s/ CARLOS A. UNANUE Carlos A. Unanue	Director	June 19, 2012
/s/ JOSÉ R. VIZCARRONDO José R. Vizcarrondo	Director	June 19, 2012
/s/ JORGE J. GARCÍA Jorge J. García	Senior Vice President and Comptroller (Principal Accounting Officer)	June 19, 2012

II-12

Pursuant to the requirements of the Securities Act of 1933, Popular North America Capital Trust II and Popular North America Capital Trust III certify that they have reasonable grounds to believe that they meet all the requirements for filing on Form S-3 and have duly caused this Registration Statement to be signed on their behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on the 19th day of June, 2012.

POPULAR NORTH AMERICA CAPITAL TRUST II

(Co-registrant)

POPULAR NORTH AMERICA CAPITAL TRUST III

(Co-registrant)

By:	POPULAR NORTH AMERICA, INC. AS DEPOSITOR
By:	/s/ JORGE A. JUNQUERA
	Name:	Jorge A. Junquera
	Title:	Senior Executive Vice President

II-13

EX-4.10

                                                                    EXHIBIT 4.10

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




                          POPULAR NORTH AMERICA, INC.,
                                    as Issuer

                                       and

                                 POPULAR, INC.,
                                  as Guarantor


                                       to



                          THE BANK OF NEW YORK MELLON,
                                   as Trustee


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

                          JUNIOR SUBORDINATED INDENTURE

                        Dated as of _________ ____, 20__

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



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





                           POPULAR NORTH AMERICA, INC.

         Reconciliation and tie between the Trust Indenture Act of 1939
(including cross-references to provisions of Sections 310 to and including 318
which, pursuant to Section 318(c) of the Trust Indenture Act of 1939, as amended
by the Trust Reform Act of 1990, are a part of and govern the Indenture whether
or not physically contained therein) and the Junior Subordinated Indenture,
dated as of ___, 20___.



TRUST INDENTURE                                                                                      INDENTURE
ACT SECTION                                                                                           SECTION
---------------                                                                                      ---------

                                                                                                
Section 310        (a) (1), (2) and (5). ............................................................ 6.9
                   (a) (3). ......................................................................... Not Applicable
                   (a) (4). ......................................................................... Not Applicable
                   (b)............................................................................... 6.8
                   .................................................................................. 6.10
                   (c). ............................................................................. Not Applicable
Section 311        (a). ............................................................................. 6.13

                   (b). ............................................................................. 6.13
Section 312        (a). ............................................................................. 7.1

                   .................................................................................. 7.2(a)
                   (b). ............................................................................. 7.2(b)
                   (c). ............................................................................. 7.2(c)
Section 313        (a). ............................................................................. 7.3(a), 7.3(b)

                   (b). ............................................................................. 7.3(a), 7.3(b)
                   (c). ............................................................................. 7.3(a), 7.3(b)
                   (d). ............................................................................. 7.3(c)
Section 314        (a) (1), (2) and (3). ............................................................ 7.4

                   (a) (4). ......................................................................... 10.4
                   (b). ............................................................................. Not Applicable
                   (c) (1). ......................................................................... 1.2
                   (c) (2). ......................................................................... 1.2
                   (c) (3). ......................................................................... Not Applicable
                   (d). ............................................................................. Not Applicable
                   (e). ............................................................................. 1.2
                   (f). ............................................................................. Not Applicable
Section 315        (a). ............................................................................. 6.1(a)

                   (b). ............................................................................. 6.2
                   .................................................................................. 7.3
                   (c). ............................................................................. 6.1(b)
                   (d). ............................................................................. 6.1(c)
                   (d) (1). ......................................................................... 6.1(a)
                   (d) (2). ......................................................................... 6.1(c) (2)
                   (d) (3). ......................................................................... 6.1(c) (3)


                                      -i-





TRUST INDENTURE                                                                                      INDENTURE
ACT SECTION                                                                                           SECTION
---------------                                                                                      ---------

                                                                                                

                   (e). ............................................................................. 5.15
Section 316        (a). ............................................................................. 1.1

                   (a) (1) (A). ..................................................................... 5.13
                   (a) (1) (B). ..................................................................... 5.14
                   (a) (2). ......................................................................... Not Applicable
                   (b). ............................................................................. 5.9
                   (c). ............................................................................. 1.4(f)
Section 317        (a) (1). ......................................................................... 5.4

                   (a) (2). ......................................................................... 5.5
                   (b). ............................................................................. 10.3
Section 318        (a). ............................................................................. 1.7





--------

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



                                      -ii-






                                TABLE OF CONTENTS




                                                                                             Page
                                                                                       

                                            ARTICLE I

                     DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

SECTION 1.1.     Definitions...................................................................1
SECTION 1.2.     Compliance Certificate and Opinions..........................................10
SECTION 1.3.     Forms of Documents Delivered to Trustee......................................10
SECTION 1.4.     Acts of Holders..............................................................11
SECTION 1.5.     Notices, Etc. to Trustee, Corporation and the Guarantor......................13
SECTION 1.6.     Notice to Holders; Waiver....................................................13
SECTION 1.7.     Conflict with Trust Indenture Act............................................13
SECTION 1.8.     Effect of Headings and Table of Contents.....................................14
SECTION 1.9.     Successors and Assigns.......................................................14
SECTION 1.10.    Separability Clause..........................................................14
SECTION 1.11.    Benefits of Indenture........................................................14
SECTION 1.12.    Governing Law................................................................14
SECTION 1.13.    Non-Business Days............................................................14

                                            ARTICLE II

                                          SECURITY FORMS

SECTION 2.1.     Forms Generally..............................................................14
SECTION 2.2.     Form of Face of Security.....................................................15
SECTION 2.3.     Form of Reverse of Security..................................................18
SECTION 2.4.     Additional Provisions Required in Global Security............................21
SECTION 2.5.     Form of Trustee's Certificate of Authentication..............................21
SECTION 2.6.     Form of Guarantee............................................................22

                                           ARTICLE III

                                          THE SECURITIES

SECTION 3.1.     Title and Terms..............................................................23
SECTION 3.2.     Denominations................................................................24
SECTION 3.3.     Execution, Authentication, Delivery and Dating...............................24
SECTION 3.4.     Temporary Securities.........................................................25
SECTION 3.5.     Global Securities............................................................25
SECTION 3.6.     Registration, Transfer and Exchange Generally................................26
SECTION 3.7.     Mutilated, Destroyed, Lost and Stolen Securities.............................27
SECTION 3.8.     Payment of Interest and Additional Interest; Interest Rights Preserved.......28
SECTION 3.9.     Persons Deemed Owners........................................................29
SECTION 3.10.    Cancellation.................................................................29
SECTION 3.11.    Computation of Interest......................................................30


                                     -iii-







                                                                                       
SECTION 3.12.    Deferrals of Interest Payment Dates..........................................30
SECTION 3.13.    Right of Set-Off.............................................................31
SECTION 3.14.    Agreed Tax Treatment.........................................................31
SECTION 3.15.    CUSIP Numbers................................................................31
SECTION 3.16.    Guarantee of Debt Securities.................................................32
SECTION 3.17.    Execution of Guarantees......................................................33

                                            ARTICLE IV

                                    SATISFACTION AND DISCHARGE

SECTION 4.1.     Satisfaction and Discharge of Indenture......................................34
SECTION 4.2.     Application of Trust Money...................................................35

                                            ARTICLE V

                                             REMEDIES

SECTION 5.1.     Debenture Event of Default...................................................35
SECTION 5.2.     Debenture Default............................................................36
SECTION 5.3.     Acceleration of Maturity; Rescission and Annulment...........................36
SECTION 5.4.     Collection of Indebtedness and Suits for Enforcement by Trustee..............37
SECTION 5.5.     Trustee May File Proofs of Claim.............................................38
SECTION 5.6.     Trustee May Enforce Claim Without Possession of Securities...................38
SECTION 5.7.     Application of Money Collected...............................................39
SECTION 5.8.     Limitation on Suits..........................................................39
SECTION 5.9.     Unconditional Right of Holders to Receive Principal, Premium and Interest;
                 Direct Action by Holders of Capital Securities...............................40
SECTION 5.10.    Restoration of Rights and Remedies...........................................40
SECTION 5.11.    Rights and Remedies Cumulative...............................................40
SECTION 5.12.    Delay or Omission Not Waiver.................................................40
SECTION 5.13.    Control by Holders...........................................................41
SECTION 5.14.    Waiver of Past Defaults......................................................41
SECTION 5.15.    Undertaking for Costs........................................................41
SECTION 5.16.    Waiver of Usury, Stay or Extension Laws......................................42

                                            ARTICLE VI

                                           THE TRUSTEE

SECTION 6.1.     Certain Duties and Responsibilities..........................................42
SECTION 6.2.     Notice of Defaults...........................................................43
SECTION 6.3.     Certain Rights of Trustee....................................................43
SECTION 6.4.     Not Responsible for Recitals or Issuance of Securities.......................44
SECTION 6.5.     May Hold Securities..........................................................44
SECTION 6.6.     Money Held in Trust..........................................................44
SECTION 6.7.     Compensation and Reimbursement...............................................44
SECTION 6.8.     Disqualification; Conflicting Interests......................................45
SECTION 6.9.     Corporate Trustee Required; Eligibility......................................45



                                      -iv-






                                                                                       

SECTION 6.10.    Resignation and Removal; Appointment of Successor............................46
SECTION 6.11.    Acceptance of Appointment by Successor.......................................47
SECTION 6.12.    Merger, Conversion, Consolidation or Succession to Business..................47
SECTION 6.13.    Preferential Collection of Claims Against Corporation or Guarantor...........48
SECTION 6.14.    Appointment of Authenticating Agent..........................................48

                                           ARTICLE VII

                      HOLDER'S LISTS AND REPORTS BY TRUSTEE AND CORPORATION

SECTION 7.1.     Corporation to Furnish Trustee Names and Addresses of Holders................49
SECTION 7.2.     Preservation of Information, Communications to Holders.......................49
SECTION 7.3.     Reports by Trustee...........................................................50
SECTION 7.4.     Reports by Corporation.......................................................50

                                           ARTICLE VIII

                       CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

SECTION 8.1.     Corporation and Guarantor May Consolidate, Etc., Only on Certain Terms.......50
SECTION 8.2.     Successor Corporation Substituted............................................51

                                            ARTICLE IX

                                     SUPPLEMENTAL INDENTURES

SECTION 9.1.     Supplemental Indentures without Consent of Holders...........................52
SECTION 9.2.     Supplemental Indentures with Consent of Holders..............................52
SECTION 9.3.     Execution of Supplemental Indentures.........................................53
SECTION 9.4.     Effect of Supplemental Indentures............................................54
SECTION 9.5.     Conformity with Trust Indenture Act..........................................54
SECTION 9.6.     Reference in Securities to Supplemental Indentures...........................54

                                            ARTICLE X

                                            COVENANTS

SECTION 10.1.    Payment of Principal, Premium and Interest...................................54
SECTION 10.2.    Maintenance of Office or Agency..............................................54
SECTION 10.3.    Money for Security Payments to be Held in Trust..............................55
SECTION 10.4.    Statement as to Compliance...................................................56
SECTION 10.5.    Waiver of Certain Covenants..................................................56
SECTION 10.6.    Additional Sums..............................................................56
SECTION 10.7.    Additional Covenants.........................................................57



                                      -v-







                                                                                       

                                            ARTICLE XI

                                     REDEMPTION OF SECURITIES

SECTION 11.1.    Applicability of This Article................................................58
SECTION 11.2.    Election to Redeem; Notice to Trustee........................................58
SECTION 11.3.    Selection of Securities to be Redeemed.......................................58
SECTION 11.4.    Notice of Redemption.........................................................59
SECTION 11.5.    Deposit of Redemption Price..................................................59
SECTION 11.6.    Payment of Securities Called for Redemption..................................60
SECTION 11.7.    Right of Redemption of Securities Initially Issued to an Issuer Trust........60

                                           ARTICLE XII

                                   SUBORDINATION OF SECURITIES

SECTION 12.1.    Securities Subordinate to Senior Debt........................................62
SECTION 12.2.    No Payment When Senior Debt in Default; Payment Over of Proceeds Upon
                 Dissolution, Etc. ...........................................................62
SECTION 12.3.    Payment Permitted If No Default..............................................63
SECTION 12.4.    Subrogation to Rights of Holders of Senior Debt..............................64
SECTION 12.5.    Provisions Solely to Define Relative Rights..................................64
SECTION 12.6.    Trustee to Effectuate Subordination..........................................65
SECTION 12.7.    No Waiver of Subordination Provisions........................................65
SECTION 12.8.    Notice to Trustee............................................................65
SECTION 12.9.    Reliance on Judicial Order or Certificate of Liquidating Agent...............66
SECTION 12.10.   Trustee Not Fiduciary for Holders of Senior Debt.............................66
SECTION 12.11.   Rights of Trustee as Holder of Senior Debt; Preservation of Trustee's Rights.66
SECTION 12.12.   Article Applicable to Paying Agents..........................................67



                                      -vi-




         JUNIOR SUBORDINATED INDENTURE, dated as of _________ ___, 20__, among
POPULAR NORTH AMERICA, INC., a Delaware corporation (the "Corporation"), having
its principal office at 209 Munoz Rivera Avenue, San Juan, Puerto Rico 00918,
POPULAR, INC., a Puerto Rico corporation (the "Guarantor") having its principal
office at 209 Munoz Rivera Avenue, San Juan, Puerto Rico 00918, and The Bank of
New York Mellon, a national banking association, as Trustee
(the "Trustee").

                  RECITALS OF THE CORPORATION AND THE GUARANTOR

         WHEREAS, the Corporation has duly authorized the execution and delivery
of this Indenture to provide for the issuance of its - % Junior Subordinated
Debentures, due ________ (hereinafter called the "Securities") of substantially
the tenor and amount hereinafter provided, including Securities issued to
evidence loans made to the Corporation of the proceeds from the issuance by a
statutory trust ("Popular North America Capital Trust __" or the "Issuer Trust")
of undivided preferred beneficial interests in the assets of the Issuer Trust
(the "Capital Securities") and undivided common beneficial interests in the
assets of the Issuer Trust (the "Common Securities" and, collectively with the
Capital Securities, the "Trust Securities"), and to provide the terms and
conditions upon which the Securities are to be authenticated, issued and
delivered; and

         WHEREAS, the Guarantor has duly authorized the execution and delivery
of this Indenture to provide for the issuance of Guarantees with respect to the
Securities; and

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

         NOW THEREFORE, THIS INDENTURE WITNESSETH:

         For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of Securities, as follows:

                                   ARTICLE I

             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

         SECTION 1.1. Definitions.

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

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

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

             (3)        The words "include", "includes" and "including" shall be
         deemed to be followed by the phrase "without limitation";





             (4)        All accounting terms not otherwise defined herein have
         the meanings assigned to them in accordance with generally accepted
         accounting principles in the United States;

             (5)        Whenever the context may require, any gender shall be
         deemed to include the others;

             (6)        Unless the context otherwise requires, any reference to
         an "Article" or a "Section" refers to an Article or a Section, as the
         case may be, of this Indenture; and

             (7)        The words "hereby", "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.

         "Act" when used with respect to any Holder has the meaning specified in
Section 1.4.

         "Additional Guarantee Payments" has the meaning specified in Section
3.16.

         "Additional Interest" means the interest, if any, that shall accrue on
any interest on the Securities the payment of which has not been made on the
applicable Interest Payment Date and which shall accrue at the rate per annum
specified or determined as specified in this Indenture.

         "Additional Sums" has the meaning specified in Section 10.6.

         "Additional Taxes" means any additional taxes, duties and other
governmental charges to which the Issuer Trust has become subject from time to
time as a result of a Tax Event.

         "Administrative Trustees" means, in respect of the Issuer Trust, each
Person identified as an "Administrative Trustee" in the Trust Agreement, solely
in such Person's capacity as Administrative Trustee of the Issuer Trust under
the Trust Agreement and not in such Person's individual capacity, or any
successor administrative trustee appointed as therein provided.

         "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

         "Agent Member" means any member of, or participant in, the Depositary.

         "Allocable Amounts," when used with respect to any Senior Subordinated
Indebtedness of the Corporation or the Guarantor, as the case may be, means the
amount necessary to pay all principal of (and premium, if any) and interest, if
any, on such Senior Subordinated Indebtedness of the Corporation or the
Guarantor, as the case may be, in full less, if applicable, any portion of such
amounts which would have been paid to, and retained by, the holders of such
Senior Subordinated Indebtedness (whether as a result of the receipt of payments
by the holders of such Senior Subordinated Indebtedness from the Corporation or
the Guarantor, as the case may be, or any other obligor thereon or from any
holders of, or trustee in respect of, other indebtedness that is subordinate and
junior in right of payment to such Senior Subordinated Indebtedness pursuant to
any provision of such indebtedness for the payment over of




                                      -2-




amounts received on account of such indebtedness to the holders of such Senior
Subordinated Indebtedness) but for the fact that such Senior Subordinated
Indebtedness is subordinate or junior in right of payment to trade accounts
payable or accrued liabilities arising in the ordinary course of business.

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

         "Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate the
Securities.

         "Bankruptcy Code" means Title 11 of the United States Code or any
successor statute thereto, in each case as amended from time to time.

         "Board of Directors" means, with respect to the Corporation and the
Guarantor, the board of directors of the Corporation or the Guarantor, or the
Executive Committee of the board of directors of the Corporation or the
Guarantor (or any other committee of the board of directors of the Corporation
or the Guarantor performing similar functions) or a committee designated by the
board of directors of the Corporation or the Guarantor (or such committee),
comprised of two or more members of the board of directors or officers, or both,
of the Corporation or the Guarantor, in each case as the context requires.

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

         "Business Day" means a day other than a Saturday, a Sunday or any other
day on which banking institutions in New York, New York, San Juan, Puerto Rico
or Wilmington, Delaware are authorized or required by law, regulation or
executive order to remain closed or are customarily closed.

         "Capital Securities" has the meaning specified in the first recital of
this Indenture.

         "Capital Treatment Event" means, with respect to the Issuer Trust, the
reasonable determination by the Corporation (as evidenced by an Officers'
Certificate delivered to the Trustee), based on an Opinion of Counsel
experienced in such matters, that, as a result of the occurrence of any
amendment to, or change (including any announced proposed change) in, the laws
(or any rules or regulations thereunder) of the United States or any political
subdivision thereof or therein, or as a result of any official or administrative
pronouncement or action or judicial decision interpreting or applying such laws,
rules or regulations, which amendment or change is effective or such
pronouncement, action or decision is announced on or after the date of the
issuance of the Capital Securities, there is more than an insubstantial risk
that the Guarantor will not be entitled to treat the Capital Securities as "Tier
1 Capital" (or the then equivalent thereof) for purposes of the capital adequacy
guidelines of the Board of Governors of the Federal Reserve System, as then in
effect and applicable to the Corporation and the Guarantor. Notwithstanding the
foregoing, a Capital Treatment Event shall not be deemed to have occurred as a
result of the adoption by the Federal Reserve Board of final rules pursuant to
its notice of proposed rulemaking dated May 6, 2004.



                                      -3-




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

         "Common Securities" has the meaning specified in the first recital of
this Indenture.

         "Common Stock" means the common stock of the Corporation or the
Guarantor, as the case may be.

         "Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered.

         "corporation" includes a corporation, association, company, limited
liability company, joint-stock company or statutory trust.

         "Corporation" means the Person named as the "Corporation" in the first
paragraph of this Indenture until a successor corporation shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Corporation" shall mean such successor corporation.

         "Corporation Request" and "Corporation Order" mean, respectively, the
written request or order signed in the name of the Corporation by its Chairman
of the Board of Directors, its Vice Chairman of the Board of Directors, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Trustee.

         "Debenture Default" has the meaning specified in Article V.

         "Debenture Event of Default" has the meaning specified in Article V.

         "Defaulted Interest" has the meaning specified in Section 3.8.

         "Delaware Trustee" means, in respect of the Issuer Trust, the Person
identified as the "Delaware Trustee" in the Trust Agreement, solely in its
capacity as Delaware Trustee of the Issuer Trust under the Trust Agreement and
not in its individual capacity, or its successor in interest in such capacity,
or any successor Delaware Trustee appointed as therein provided.

         "Depositary" means, with respect to any Securities issuable or issued
in whole or in part in the form of one or more Global Securities, the Person
designated as Depositary by the Corporation pursuant to Section 3.5 with respect
to such Securities (or any successor thereto).

         "Distributions," with respect to the Trust Securities, means amounts
payable in respect of such Trust Securities as provided in the Trust Agreement
and referred to therein as "Distributions."

         "Dollar" or "$" means the currency of the United States that, as at the
time of payment, is legal tender for the payment of public and private debts.

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

         "Expiration Date" has the meaning specified in Section 1.4.



                                      -4-




         "Extension Period" has the meaning specified in Section 3.12.

         "Global Security" means a Security in the form prescribed in Section
2.4 evidencing all or part of the Securities, issued to the Depositary or its
nominee for the Securities, and registered in the name of such Depositary or its
nominee.

         "Guarantees" means the guarantees of the Guarantor to be endorsed on
the Securities authenticated and delivered hereunder.

         "Guarantee Agreement" means the Guarantee Agreement executed by the
Corporation, the Guarantor and The Bank of New York Mellon, as guarantee
trustee, contemporaneously with the execution and delivery of this Indenture,
for thebenefit of the Holders of Capital Securities, as amended from time to
time.

         "Guarantor" means the Person named as the "Guarantor" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Guarantor" shall mean such successor corporation.

         "Guarantor Request" and "Guarantor Order" mean, respectively, the
written request or order signed in the name of the Guarantor by its Chairman of
the Board of Directors, its Vice Chairman of the Board of Directors, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Trustee.

         "Holder" means a Person in whose name a Security or Securities is or
are registered in the Securities Register.

         "Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.

         "Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.

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

         "Investment Company Event" means the receipt by the Issuer Trust of an
Opinion of Counsel experienced in such matters to the effect that, as a result
of any (i) amendment to, or change (including any announced proposed change) in,
the applicable laws (or any regulations thereunder) of the United States or any
political subdivision or other governmental agency or regulatory authority of or
in the United States, or (ii) official or administrative pronouncement or action
or judicial decision interpreting or applying such laws or regulations, which
amendment or change is effective or which proposed change, pronouncement, action
or decision is announced on or after the date of original issuance of the
Capital Securities, there is more than an insubstantial risk that the Issuer
Trust is or will be considered an "investment company" that is required to be
registered under the Investment Company Act of 1940.

         "Issuer Trust" has the meaning specified in the first recital of this
Indenture.



                                      -5-




         "Maturity" when used with respect to any Security means the date on
which the principal of such Security or any installment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.

         "Notice of Default" means a written notice of the kind specified in
Section 5.2(3).

         "Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the President or a Vice President, and
by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Corporation or the Guarantor, as the context requires, and
delivered to the Trustee.

         "Opinion of Counsel" means a written opinion of counsel, who may be
counsel for or an employee of the Corporation or the Guarantor, or any Affiliate
of the Corporation or the Guarantor.

         "Original Issue Date" means the date of issuance specified as such in
each Security.

         "Outstanding" means, when used in reference to any Securities, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:

             (i)        Securities theretofore canceled by the Trustee or
         delivered to the Trustee for cancellation;

             (ii)       Securities for whose payment money in the necessary
         amount has been theretofore deposited with the Trustee or any Paying
         Agent in trust for the Holders of such Securities; and

             (iii)      Securities in substitution for or in lieu of which other
         Securities have been authenticated and delivered or that have been paid
         pursuant to Section 3.7, unless proof satisfactory to the Trustee is
         presented that any such Securities are held by Holders in whose hands
         such Securities are valid, binding and legal obligations of the
         Corporation;

provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Corporation or any other obligor upon the Securities or any Affiliate of
the Corporation or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities that the Trustee knows to be so owned shall
be so disregarded. Securities so owned that have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Corporation or any other obligor upon the Securities or
any Affiliate of the Corporation or such other obligor. Upon the written request
of the Trustee, the Corporation shall furnish to the Trustee promptly an
Officers' Certificate listing and identifying all Securities, if any, known by
the Corporation to be owned or held by or for the account of the Corporation, or
any other obligor on the Securities or any Affiliate of the Corporation or such
obligor, and subject to the provisions of Section 6.1, the Trustee shall be
entitled to accept such Officers' Certificate as conclusive evidence of the
facts therein set forth and of the fact that all Securities not listed therein
are Outstanding for the purpose of any such determination. Notwithstanding
anything herein to the contrary, Securities initially issued to the Issuer Trust
that are owned by the Issuer Trust shall be deemed



                                      -6-




to be Outstanding notwithstanding the ownership by the Corporation or an
Affiliate of any beneficial interest in the Issuer Trust.

         "Paying Agent" means the Trustee or any Person authorized by the
Corporation to pay the principal of (or premium, if any) or interest on, or
other amounts in respect of, any Securities on behalf of the Corporation.

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

         "Place of Payment" means, with respect to the Securities, the place or
places where the principal of (and premium, if any) and interest on the
Securities are payable pursuant to Section 3.1.

         "Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security. For the purposes of this definition, any security
authenticated and delivered under Section 3.7 in lieu of a mutilated, destroyed,
lost or stolen Security shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen Security.

         "Proceeding" has the meaning specified in Section 12.2.

         "Property Trustee" means, in respect of the Issuer Trust, the Person
identified as the "Property Trustee" in the Trust Agreement, solely in its
capacity as Property Trustee of the Issuer Trust under the Trust Agreement and
not in its individual capacity, or its successor in interest in such capacity,
or any successor Property Trustee appointed as therein provided.

         "Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.

         "Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.

         "Regular Record Date" for the interest payable on any Interest Payment
Date with respect to the Securities means the date that is fifteen days next
preceding such Interest Payment Date (whether or not a Business Day).

         "Responsible Officer", when used with respect to the Trustee, means the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer 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 his knowledge of
and familiarity with the particular subject.

         "Rights Plan" means a plan of the Corporation or the Guarantor, as the
case may be, providing for the issuance by the Corporation or the Guarantor, as
the case may be, to all holders of its Common




                                      -7-




Stock of rights entitling the holders thereof to subscribe for or purchase
shares of any class or series of capital stock of the Corporation or Guarantor,
as the case may be, which rights (i) are deemed to be transferred with such
shares of such Common Stock, and (ii) are also issued in respect of future
issuances of such Common Stock, in each case until the occurrence of a specified
event or events.

         "Securities" or "Security" means any debt securities or debt security,
as the case may be, authenticated and delivered under this Indenture.

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

         "Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 3.6.

         "Senior Debt" of the Corporation or the Guarantor, as the case may be,
means (i) Senior Indebtedness of the Corporation or the Guarantor, respectively
(but excluding trade accounts payable and accrued liabilities arising in the
ordinary course of business), and (ii) the Allocable Amounts of Senior
Subordinated Indebtedness of the Corporation or Guarantor, respectively.

         "Senior Indebtedness" means any obligation of the Corporation or the
Guarantor, as the case may be, to its creditors, whether now outstanding or
subsequently incurred, other than any obligation as to which, in the instrument
creating or evidencing the obligation or pursuant to which the obligation is
outstanding, it is provided that such obligation is not Senior Indebtedness.
Senior Indebtedness does not include Senior Subordinated Indebtedness or the
Securities or any junior subordinated debt securities issued in the future by
the Corporation or the Guarantor, as the case may be, with subordination terms
substantially similar to those of the Securities.

         "Senior Subordinated Indebtedness" means any obligation of the
Corporation or the Guarantor, as the case may be, to its creditors, whether now
outstanding or subsequently incurred, where the instrument creating or
evidencing the obligation or pursuant to which the obligation is outstanding,
provides that it is subordinate and junior in right of payment to Senior
Indebtedness, including the Subordinated Indenture, dated as of November 30,
1995, between the Guarantor and The First National Bank of Chicago, as Trustee,
but does not include the Securities or any junior subordinated debt securities
issued in the future by the Corporation or the Guarantor, as the case may be,
with subordination terms substantially similar to those of the Securities.

         "Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.8.

         "Stated Maturity", when used with respect to any Security or any
installment of principal thereof (or premium, if any) or interest (including any
Additional Interest) thereon, means the date specified pursuant to the terms of
such Security as the fixed date on which the principal of such Security or such
installment of principal (or premium, if any) or interest (including any
Additional Interest) is due and payable, as such date may, in the case of the
stated maturity of the principal on any security, be shortened or extended as
provided pursuant to the terms of such Security and this Indenture and, in the
case of any installment of interest, subject to the deferral of any such date in
the case of any Extension Period.

         "Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Corporation or
the Guarantor, as the context requires, or by one or




                                      -8-




more other Subsidiaries, or by the Corporation or the Guarantor, as the context
requires, and one or more other Subsidiaries. For purposes of this definition,
"voting stock" means stock that ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of stock has
such voting power by reason of any contingency.

         "Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.7 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.

         "Tax Event" means the receipt by the Issuer 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 proposed change) in, the laws
(or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of issuance of
the Capital Securities, there is more than an insubstantial risk that (i) the
Issuer Trust is, or will be within 90 days following the delivery of such
Opinion of Counsel, subject to United States Federal income tax with respect to
income received or accrued on the Securities issued by the Corporation to the
Issuer Trust, (ii) interest payable by the Corporation on such Securities is
not, or within 90 days following the delivery of such Opinion of Counsel will
not be, deductible by the Corporation, in whole or in part, for United States
Federal income tax purposes, or (iii) the Issuer Trust is, or will be within 90
days following the delivery of such Opinion of Counsel, subject to more than a
de minimis amount of other taxes, duties or other governmental charges.

         With respect to Securities that are no longer held by the Issuer Trust,
"Tax Event" means the receipt by the Corporation of an Opinion of Counsel
experienced in such matters to the effect that, as a result of any (i) amendment
to, or change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority of or in the United States or (ii) official or administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or which proposed change,
pronouncement or decision is announced on or after the date of original issuance
of the Securities under this Indenture, there is more than an insubstantial risk
that interest payable by the Corporation on the Securities is not, or within 90
days following the date of such Opinion of Counsel will not be, deductible by
the Corporation, in whole or in part, for United States Federal income tax
purposes.

         "Taxes" has the meaning specified in Section 3.16.

         "Trust Agreement" means, with respect to the Issuer Trust, the trust
agreement or other governing instrument of the Issuer Trust, as amended from
time to time.

         "Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture, solely in its capacity as such and not in its
individual capacity, until a successor Trustee shall have become such pursuant
to the applicable provisions of this Indenture, and thereafter "Trustee" shall
mean such successor Trustee.

         "Trust Indenture Act" means the Trust Indenture Act of 1939 as in force
on the date as of this Indenture; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such




                                      -9-




date, "Trust Indenture Act" means, to the extent required by any such amendment,
the Trust Indenture Act of 1939 as so amended.

         "Trust Securities" has the meaning specified in the first recital of
this Indenture.

         "United States" means the United States of America.

         "Vice President," when used with respect to the Corporation or the
Guarantor, means any duly appointed vice president, whether or not designated by
a number or a word or words added before or after the title "vice president," of
the Corporation or the Guarantor, respectively.

         SECTION 1.2.   Compliance Certificate and Opinions.

         Upon any application or request by the Corporation or the Guarantor to
the Trustee to take any action under any provision of this Indenture, the
Corporation or the Guarantor, as the case may be, shall furnish to the Trustee
an Officers' Certificate stating that all conditions precedent (including
covenants compliance with which constitutes a condition 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 (including covenants compliance with which
constitutes a condition precedent), if any, have been complied with, except that
in the case of any such application or request as to which the furnishing of
such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.

         Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than the
certificates provided pursuant to Section 10.4) shall include:

         (1)    a statement by each individual signing such certificate or
opinion that such individual has read such covenant or condition and the
definitions herein relating thereto;

         (2)    a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions of such individual
contained in such certificate or opinion are based;

         (3)    a statement that, in the opinion of such individual, 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

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

         SECTION 1.3.   Forms of Documents Delivered to Trustee.

         In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.



                                      -10-




         Any certificate or opinion of an officer of the Corporation or the
Guarantor may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to matters upon which his or her
certificate or opinion is based are erroneous. Any such certificate or Opinion
of Counsel may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of the
Corporation or the Guarantor, as the case may be, stating that the information
with respect to such factual matters is in the possession of the Corporation or
the Guarantor, as the case may be, unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.

         Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions, or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.

         SECTION 1.4.   Acts of Holders.

         (a)    Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given to or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments is or are
delivered to the Trustee, and, where it is hereby expressly required, to the
Corporation and the Guarantor. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and (subject to Section 6.1)
conclusive in favor of the Trustee, the Corporation and the Guarantor, if made
in the manner provided in this Section.

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

         (c)    The fact and date of the execution by any Person of any such
instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner that the Trustee deems sufficient and in
accordance with such reasonable rules as the Trustee may determine.

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

         (e)    Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security issued upon the
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done or suffered to be done by the Trustee, the Corporation or the
Guarantor in reliance thereon, whether or not notation of such action is made
upon such Security.



                                      -11-




         (f)    The Corporation may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities entitled to give, make or
take any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders of Securities, provided that the Corporation may not set a record
date for, and the provisions of this paragraph shall not apply with respect to,
the giving or making of any notice, declaration, request or direction referred
to in the next succeeding paragraph. If any record date is set pursuant to this
paragraph, the Holders of the Outstanding Securities on such record date, and no
other Holders, shall be entitled to take the relevant action, whether or not
such Holders remain Holders after such record date, provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date (as defined below) by Holders of the requisite principal amount
of Outstanding Securities on such record date. Nothing in this paragraph shall
be construed to prevent the Corporation from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, the Corporation, at its own expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Trustee in writing and to each Holder of Securities in the
manner set forth in Section 1.6.

         The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to join in the giving
or making of (i) any Notice of Default, (ii) any declaration of acceleration
referred to in Section 5.3, (iii) any request to institute proceedings referred
to in Section 5.8(2), or (iv) any direction referred to in Section 5.13, in each
case with respect to such Securities. If any record date is set pursuant to this
paragraph, the Holders of Outstanding Securities on such record date, and no
other Holders, shall be entitled to join in such notice, declaration, request or
direction, whether or not such Holders remain Holders after such record date,
provided that no such action shall be effective hereunder unless taken on or
prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Securities on such record date. Nothing in this paragraph
shall be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities on the date such
action is taken. Promptly after a record date is set pursuant to this paragraph,
the Trustee, at the Corporation's expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Corporation in writing and to each Holder of Securities in the
manner set forth in Section 1.6.

         With respect to any record date set pursuant to this Section, the party
that sets such record date may designate any day as the "Expiration Date" and
from time to time may change the Expiration Date to any earlier or later day,
provided that no such change shall be effective unless notice of the proposed
new Expiration Date is given to the other party hereto in writing, and to each
Holder of Securities in the manner set forth in Section 1.6, on or prior to the
existing Expiration Date. If an Expiration Date is not designated with respect
to any record date set pursuant to this Section, the party hereto that set such
record date shall be deemed to have initially designated the 180th day after
such record date as the Expiration Date with respect thereto, subject to its
right to change the Expiration Date as provided in this paragraph.
Notwithstanding the foregoing, no Expiration Date shall be later than the 180th
day after the applicable record date.



                                      -12-




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

         SECTION 1.5.   Notices, Etc. to Trustee, Corporation and the Guarantor.

         Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,

         (1)    the Trustee by any Holder, any holder of Capital Securities, the
Corporation or the Guarantor shall be sufficient for every purpose hereunder if
made, given, furnished or filed in writing to or with the Trustee at its
Corporate Trust Office, or

         (2)    the Corporation or the Guarantor by the Trustee, any Holder or
any holder of Capital Securities shall be sufficient for every purpose (except
as otherwise provided in Section 5.2) hereunder if in writing and mailed, first
class, postage prepaid, to the Corporation or the Guarantor, as the case may be,
addressed to it at the address of its principal office specified in the first
paragraph of this instrument or at any other address previously furnished in
writing to the Trustee by the Corporation or Guarantor.

         SECTION 1.6.   Notice to Holders; Waiver.

         Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first class postage prepaid, to each Holder affected
by such event, at the address of such Holder as it appears in the Securities
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. If, by reason of the suspension
of or irregularities in regular mail service or for any other reason, it shall
be impossible or impracticable to mail notice of any event to Holders when said
notice is required to be given pursuant to any provision of this Indenture or of
the relevant Securities, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.

         SECTION 1.7.   Conflict with Trust Indenture Act.

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



                                      -13-




         SECTION 1.8.   Effect of Headings and Table of Contents.

         The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.

         SECTION 1.9.   Successors and Assigns.

         All covenants and agreements in this Indenture by the Corporation or
the Guarantor shall bind their respective successors and assigns, whether so
expressed or not.

         SECTION 1.10.  Separability Clause.

         If any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

         SECTION 1.11.  Benefits of Indenture.

         Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors and
assigns, the holders of Senior Debt, the Holders of Securities and, to the
extent expressly provided in Sections 1.5, 3.5(e), 5.1, 5.2, 5.3, 5.9, 5.10,
5.12, 5.14, 9.1 and 9.2, the holders of Capital Securities, any benefit or any
legal or equitable right, remedy or claim under this Indenture.

         SECTION 1.12.  Governing Law.

         THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND WHOLLY TO BE PERFORMED IN SUCH STATE.

         SECTION 1.13.  Non-Business Days.

         If any Interest Payment Date, Redemption Date or Stated Maturity of any
Security shall not be a Business Day, then (notwithstanding any other provision
of this Indenture or the Securities) payment of interest or principal (and
premium, if any) or other amounts in respect of such Security need not be made
on such date, but may be made on the next succeeding Business Day (and no
interest shall accrue in respect of the amounts whose payment is so delayed for
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, until such next succeeding Business Day).

                                   ARTICLE II

                                 SECURITY FORMS

         SECTION 2.1.   Forms Generally.

         The Securities and the Trustee's certificate of authentication shall be
in substantially the forms set forth in this Article, or in such other form or
forms as shall be established by or pursuant to a Board Resolution or in one or
more indentures supplemental hereto, in each case with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have such letters, numbers or other marks of
identification and such legends or endorsements placed




                                      -14-




thereon as may be required to comply with applicable tax laws or the rules of
any securities exchange or as may, consistently herewith, be determined by the
officers executing such securities, as evidenced by their execution of the
Securities. If the form of Securities is established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Corporation and
delivered to the Trustee at or prior to the delivery of the Corporation Order
contemplated by Section 3.3 with respect to the authentication and delivery of
such Securities.

         The Guarantees to be endorsed on the Securities shall be in
substantially the form set forth in this Article, or in such other form as shall
be established by or pursuant to a Board Resolution of the Guarantor or in one
or more indentures supplemental hereto, in each case with appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends and endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Guarantees,
as evidenced by their execution of such Guarantees.

         The definitive Securities shall be typewritten, printed, lithographed
or engraved or produced by any combination of these methods, if required by any
securities exchange on which the Securities may be listed, on a steel engraved
border or steel engraved borders or may be produced in any other manner
permitted by the rules of any securities exchange on which the Securities may be
listed, all as determined by the officers executing such Securities, as
evidenced by their execution of such Securities.

         SECTION 2.2.   Form of Face of Security.

                           POPULAR NORTH AMERICA, INC.
              ____% JUNIOR SUBORDINATED DEBENTURES, DUE ____, 20___

CUSIP ____
No.                                                                    $

         POPULAR NORTH AMERICA, INC., a corporation organized and existing under
the laws of Delaware (hereinafter called the "Corporation", which term includes
any successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to ___________, or registered assigns, the
principal sum of __________ Dollars on __________ __, or such other principal
amount represented hereby as may be set forth in the records of the Securities
Registrar hereinafter referred to in accordance with the Indenture. The
Corporation further promises to pay interest on said principal sum from ______,
or from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually (subject to deferral as set forth herein) in
arrears on __________ and ___________ of each year, commencing ________, 20___,
at the rate of __% per annum, together with Additional Sums, if any, as provided
in Section 10.6 of the Indenture until the principal hereof is paid or duly
provided for or made available for payment; provided that any overdue principal,
premium or Additional Sums and any overdue installment of interest or Additional
Interest shall bear interest at the rate of ___% per annum (to the extent that
the payment of such interest shall be legally enforceable), compounded
semi-annually, from the dates such amounts are due until they are paid or made
available for payment, and such interest shall be payable on demand. The amount
of interest payable for any period less than a full interest period shall be
computed on the basis of a 360-day year of twelve 30-day months and the actual
days elapsed in a partial month in such period. The amount of interest payable
for any full interest period shall be computed by dividing the applicable rate
per annum by two. The interest so




                                      -15-




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
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest installment, which shall
be the fifteenth day (whether or not a Business Day), preceding such Interest
Payment Date. Any such interest not so punctually paid or duly provided for
shall forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture.

         So long as no Debenture Event of Default has occurred and is
continuing, the Corporation shall have the right, at any time during the term of
this Security, from time to time to defer the payment of interest on this
Security for up to 10 consecutive semi-annual interest payment periods with
respect to each deferral period (each an "Extension Period"), and at the end of
which the Corporation shall pay all interest then accrued and unpaid, including
any Additional Interest, as provided below; provided, however, that no Extension
Period shall extend beyond the Stated Maturity of the principal of this Security
and no such Extension Period may end on a date other than an Interest Payment
Date; and provided, further, however, that during any such Extension Period, the
Corporation shall not, and shall not permit any of its Subsidiaries to, (i)
declare or pay any dividends or distributions on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any of the Corporation's capital
stock, (ii) make any payment of principal of or interest or premium, if any, on
or repay, repurchase or redeem any debt securities of the Corporation that rank
pari passu in all respects with or junior in interest to this Security or the
Guarantees, respectively or (iii) make any guarantee payments with respect to
any guarantee by the Corporation of the debt securities of any Subsidiary of the
Corporation if such guarantee ranks pari passu with or junior in interest to
this Security or the Guarantees (other than (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Corporation in connection
with any employment contract, benefit plan or other similar arrangement with or
for the benefit of any one or more employees, officers, directors, consultants
or independent contractors, in connection with a dividend reinvestment or
stockholder stock purchase plan or in connection with the issuance of capital
stock of the Corporation (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period, (b) as a result of an exchange or conversion
of any class or series of the Corporation's capital stock (or any capital stock
of a Subsidiary of the Corporation) for any class or series of the Corporation's
capital stock or of any class or series of the Corporation's indebtedness for
any class or series of the Corporation's capital stock, (c) the purchase of
fractional interests in shares of the Corporation'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 Rights Plan, or the issuance of rights, stock or other property under
any 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
such Extension Period, the Corporation may further defer the payment of
interest, provided that no Extension Period shall exceed 10 consecutive
semi-annual interest periods, extend beyond the Stated Maturity of the principal
of this Security or end on a date other than an Interest Payment Date. Upon the
termination of any such Extension Period and upon the payment of all accrued and
unpaid interest and any Additional Interest then due on any Interest Payment
Date, the Corporation




                                      -16-




may elect to begin a new Extension Period, subject to the above conditions. No
interest other than Additional Sums shall be due and payable during an Extension
Period, except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear
interest (to the extent that the payment of such interest shall be legally
enforceable) at the rate of ___% per annum, compounded semi-annually and
calculated as set forth in the first paragraph of this Security, from the dates
on which amounts would otherwise have been due and payable until paid or made
available for payment. The Corporation shall give the Holder of this Security
and the Trustee notice of its election to begin any Extension Period at least
one Business Day prior to the record date for the next succeeding Interest
Payment Date on which interest on this Security would be payable but for such
deferral or so long as such Securities are held by Popular North America Capital
Trust __, at least one Business Day prior to the earlier of (i) the next
succeeding date on which Distributions on the Capital Securities would be
payable but for such deferral, and (ii) the date on which the Property Trustee
is required to give notice to holders of the Capital Securities of the record
date or the date such Distributions are payable.

         Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Corporation maintained for
that purpose in The City of New York, in such coin or currency of the United
States as at the time of payment is legal tender for payment of public and
private debts; provided, however, that (i) at the option of the Corporation
payment of interest on an Interest Payment Date may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Securities Register, (ii) upon the written request by any Holder of $1,000,000
or more in aggregate principal amount of the Securities, not later than 15
calendar days prior to the date on which such interest is payable, payment of
such interest shall be made by wire transfer in immediately available funds at
such place and to such account as may be designated by the Person entitled
thereto, as specified in the Securities Register or (iii) payments due at the
Stated Maturity of this Security will be made in immediately available funds
against presentation and surrender of this Security. If the Holder of this
Security is the Depository Trust Company or the Issuer Trust (or a trustee
thereof), all payments in respect of this Security shall be made in immediately
available funds.

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

         Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

         IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed under its corporate seal.



                                      -17-




                                           POPULAR NORTH AMERICA, INC.


                                           By:
                                              Name:
                                              Title:

Attest:


----------------------------------
[Secretary or Assistant Secretary]



         SECTION 2.3.   Form of Reverse of Security.

         This Security is one of a duly authorized issue of securities of the
Corporation designated as its ____% Junior Subordinated Debentures, due 20___
(herein called the "Securities"), limited in aggregate principal amount
to $____, issued and to be issued under the Junior Subordinated Indenture, dated
as of ______, 20___ (herein called the "Indenture"), among the Corporation,
Popular, Inc., as Guarantor, and The Bank of New York Mellon, as Trustee (herein
called the "Trustee", which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Corporation, the Guarantor, the Trustee,
the holders of Senior Debt and the Holders of Securities, and of the terms upon
which the Securities are, and are to be, authenticated and delivered.

         All terms used in this Security that are defined in the Indenture or in
the Amended and Restated Trust Agreement, dated as of ________ __, 20__ (as
modified, amended or supplemented from time to time, the "Trust Agreement"),
relating to Popular North America Capital Trust I (the "Issuer Trust") among the
Corporation, as Depositor, Popular, Inc., as Guarantor, the Trustees named
therein and the Holders from time to time of the Trust Securities issued
pursuant thereto, shall have the meanings assigned to them in the Indenture or
the Trust Agreement, as the case may be.

         The Corporation may, at its option, subject to the terms and conditions
of Article XI of the Indenture and subject to the Corporation having received
prior approval of the Federal Reserve if then required under applicable capital
guidelines or policies, redeem this Security in whole at any time or in part
from time to time, at a Redemption Price equal to the greater of (i) 100% of the
principal amount of this Security being redeemed or (ii) as determined by a
Quotation Agent (as defined below), the sum of the present values of scheduled
payments of principal and interest for the Remaining Life (as defined below) of
this Security being redeemed, discounted to the Redemption Date on a semi-annual
basis (assuming a 360-day year consisting of twelve 30-day months) at the
Treasury Rate (as defined below) plus ____%, plus, in the case of either (i) or
(ii), accrued and unpaid interest thereon to the Redemption Date.

         "Remaining Life" means, with respect to an optional redemption of the
Securities, the period from the Redemption Date through ____, 20___.

         "Treasury Rate" means (i) the yield, under the heading which represents
the average for the immediately prior week, appearing in the most recently
published statistical release designated "H.15(519)" or any successor
publication which is published weekly by the Board of Governors of the




                                      -18-




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

         "Comparable Treasury Issue" means, with respect to any Redemption Date,
the United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Remaining Life that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the Remaining
Life. If no United States Treasury security has a maturity which is within a
period from three months before to three months after __________, 20__, the two
most closely corresponding United States Treasury securities shall be used as
the Comparable Treasury Issue, and the Treasury Rate shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest month using such
securities.

         "Quotation Agent" means each of [to come] and their respective
successors; provided, however, that if the foregoing shall cease to be a primary
U.S. Government securities dealer in New York City (a "Primary Treasury
Dealer"), the Corporation shall substitute therefor another Primary Treasury
Dealer.

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

         "Comparable Treasury Price" means (A) if the Trustee obtains five
Reference Treasury Dealer Quotations, the average of three Reference Treasury
Dealer Quotations for such Redemption Date, after excluding the highest and
lowest Reference Treasury Dealer Quotations obtained, or (B) if the Trustee
obtains fewer than five Reference Treasury Dealer Quotations, the average of all
such Reference Treasury Dealer Quotations.

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

         In addition, upon the occurrence and during the continuation of a Tax
Event, Capital Treatment Event or Investment Company Event in respect of the
Issuer Trust, the Corporation may, at its option, subject to its having received
prior approval of the Federal Reserve if then required under applicable capital
guidelines or policies, at any time within 90 days following the occurrence and
during the continuation of such Tax Event, Capital Treatment Event or Investment
Company Event, as the case may be, redeem this Security, in whole but not in
part, subject to the terms and conditions of Article XI of the Indenture, at a
redemption price equal to 100% of the principal amount, plus accrued and unpaid
interest thereon to the date of redemption.



                                      -19-




         In the event of redemption of this Security in part only, a new
Security or Securities for the unredeemed portion hereof will be issued in the
name of the Holder hereof upon the cancellation hereof.

         The Indenture contains provisions for satisfaction and discharge of the
entire indebtedness of this Security upon compliance by the Corporation with
certain conditions set forth in the Indenture.

         The Indenture permits, with certain exceptions as therein provided, the
Corporation, the Guarantor and the Trustee at any time to enter into a
supplemental indenture or indentures for the purpose of modifying in any manner
the rights and obligations of the Corporation, the Guarantor and of the Holders
of Securities, with the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities. The Indenture also contains
provisions permitting Holders of specified percentages in principal amount of
the Securities at the time Outstanding, on behalf of the Holders of all
Securities, to waive compliance by the Corporation and the Guarantor with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.

         If a Debenture Event of Default specified in Section 5.1(1) of the
Indenture with respect to the Securities at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities may declare
the principal amount of all the Securities to be due and payable immediately, by
a notice in writing to the Corporation and the Guarantor (and to the Trustee if
given by Holders), provided that, if upon such Debenture Event of Default, the
Trustee or the Holders fail to declare the principal of all the Outstanding
Securities to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount of the Capital Securities then Outstanding shall
have the right to make such declaration by a notice in writing to the
Corporation and the Trustee; and upon any such declaration such principal amount
(or specified portion thereof) of and the accrued interest (including any
Additional Interest) on all the Securities shall become immediately due and
payable. If a Debenture Event of Default specified in Section 5.1(2) or 5.1(3)
of the Indenture with respect to the Securities at the time Outstanding occurs,
the principal amount of all such Securities shall automatically, and without any
declaration or other action on the part of the Trustee or any Holder, become
immediately due and payable. The payment of principal and interest (including
any Additional Interest) on such Securities shall remain subordinated to the
extent provided in Article XII of the Indenture.

         No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Corporation,
which is absolute and unconditional, to pay the principal of (and premium, if
any) and interest (including any Additional Interest) on this Security at the
times, place and rate, and in the coin or currency, herein prescribed.

         As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Corporation maintained under Section 10.2 of the
Indenture for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Corporation and
the Securities Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Securities,
of like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.



                                      -20-




         The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Securities are
exchangeable for a like aggregate principal amount of Securities and of like
tenor of a different authorized denomination, as requested by the Holder
surrendering the same.

         No service charge shall be made for any such registration of transfer
or exchange, but the Corporation may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.

         Prior to due presentment of this Security for registration of transfer,
the Corporation, the Guarantor, the Trustee and any agent of the Corporation,
the Guarantor or the Trustee may treat the Person in whose name this Security is
registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Corporation, the Guarantor, the Trustee nor any such
agent shall be affected by notice to the contrary.

         The Corporation and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agree that for United States Federal, State and local
tax purposes it is intended that this Security constitute indebtedness.

         THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND WHOLLY TO BE
PERFORMED IN SUCH STATE.

         SECTION 2.4.   Additional Provisions Required in Global Security.

         Any Global Security issued hereunder shall, in addition to the
provisions contained in Sections 2.2 and 2.3, bear a legend in substantially the
following form:

         THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
         HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY
         OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR
         SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY
         OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
         INDENTURE AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
         DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
         DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY,
         EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

         SECTION 2.5.   Form of Trustee's Certificate of Authentication.

         The Trustee's certificates of authentication shall be in substantially
the following form:

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



                                      -21-




Dated:

                                   THE BANK OF NEW YORK MELLON,
                                   as Trustee

                                   By:
                                       ----------------------------------------
                                       Authorized officer


         SECTION 2.6.   Form of Guarantee.

         POPULAR, INC. (the "Guarantor") hereby irrevocably and unconditionally
guarantees to the Holder of this Security, and, to the extent specified in
Section 5.9 of the Indenture, each registered holder of Capital Securities, duly
authenticated and delivered by the Trustee the due and punctual payment of the
principal of, and premium, if any, (including any amount in respect of original
issue discount), and interest, if any (together with any Additional Interest and
Additional Sums payable pursuant to the terms of this Security), on, this
Security, provided for pursuant to the terms of this Security, when and as the
same shall become due and payable, whether at Stated Maturity or on redemption,
acceleration or otherwise according to the terms of this Security and of the
Indenture. In case of default by the Corporation in the payment of any such
principal (including any amount in respect of original issue discount), or any
premium or interest (together with any Additional Interest and Additional Sums
payable pursuant to the terms of this Security), the Guarantor agrees duly and
punctually to pay the same when and as the same shall become due and payable.
The Guarantor hereby agrees that its obligations hereunder shall be as principal
and not merely as surety, and shall be absolute and unconditional irrespective
of any circumstances which may constitute a legal or equitable discharge of a
surety or guarantor, including, without limitation, any modification of this
Security, any invalidity, irregularity or unenforceability of this Security or
the Indenture, any failure to enforce the same or any waiver, modification,
consent or indulgence granted to the Corporation with respect thereto by the
Holder of this Security or the Trustee. The Guarantor hereby waives diligence,
presentment, demand or payment, filing of claims with a court in the event of
merger or bankruptcy of the Corporation, any right to require a demand or
proceeding first against the Corporation, the Trustee, the Issuer Trust or a
trustee of the Issuer Trust, protest or notice with respect to this Security or
the indebtedness evidenced thereby and all demands whatsoever, and covenants
that this guarantee will not be discharged as to this Security except by payment
in full of the principal of (including any amount payable in respect of original
issue discount), and any premium or interest (together with any Additional
Interest and Additional Sums payable pursuant to the terms of this Security), on
this Security.

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



                                      -22-




         Payments pursuant to this Guarantee shall be made without set-off,
counterclaim, fees, liabilities or similar deductions, and free and clear of,
and without deduction or withholding for, taxes, levies, imposts, duties,
charges or fees of whatsoever nature now or hereafter imposed, levied,
collected, deducted, withheld or assessed by or on behalf of the Commonwealth of
Puerto Rico or any political subdivision or taxing authority thereof or therein,
as provided for in Section 3.16 of the Indenture.

         The Guarantor irrevocably waives any and all rights to which it may be
entitled, by operation of law or otherwise, by making any payment hereunder (i)
to be subrogated to the rights of a Holder against the Corporation with respect
to such payment or otherwise to be reimbursed, indemnified or exonerated by the
Corporation in respect thereof or (ii) to receive any payment, in the nature of
contribution or for any other reason, from any other obligor with respect to
such payment.

         This guarantee shall not be valid or become obligatory for any purpose
with respect to this Security until the certificate of authentication on this
Security shall have been signed by the Trustee.

         THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND WHOLLY TO BE
PERFORMED IN SUCH STATE.

         IN WITNESS WHEREOF, Popular, Inc. has caused this Guarantee to be
signed by facsimile by its duly authorized officers and has caused a facsimile
of its corporate seal to be affixed hereunto or imprinted hereon.

                                       POPULAR, INC.

                                       By:
                                          --------------------------------------
                                          Authorized officer


                                  ARTICLE III

                                 THE SECURITIES

         SECTION 3.1.   Title and Terms.

         The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is limited to $________, except for
Securities authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities pursuant to Section 3.4, 3.5, 3.6,
9.6 or 11.6.

         The Securities shall be known and designated as the ____% Junior
Subordinated Debentures, due ____, 20__, of the Corporation. Their Stated
Maturity shall be ____, 20__, and they shall bear interest at the rate of ____%
per annum, from and including ____, 20__ or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, as the case
may be, payable semi-annually in arrears on ____ and ____ commencing ____, 20__,
until the principal thereof is paid or made available for payment.

         Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Corporation maintained for
that purpose in The City of New York, in such coin or




                                      -23-



currency of the United States as at the time of payment is legal tender for
payment of public and private debts; provided, however, that (i) at the option
of the Corporation payment of interest on an Interest Payment Date may be made
by check mailed to the address of the Person entitled thereto as such address
shall appear in the Securities Register, (ii) upon the written request by any
Holder of $1,000,000 or more in aggregate principal amount of the Securities,
not later than 15 calendar days prior to the date on which such interest is
payable, payment of such interest shall be made by wire transfer in immediately
available funds at such place and to such account as may be designated by the
Person entitled thereto, as specified in the Securities Register or (iii)
payments due at the Stated Maturity of the Securities will be made in
immediately available funds against presentation and surrender of the
Securities. If the Holder of the Securities is the Depository Trust Company or
the Issuer Trust (or a trustee thereof), all payments in respect of the
Securities shall be made in immediately available funds.

         The Securities shall be redeemable as provided in Article XI.

         The Securities shall be subordinated in right of payment to Senior Debt
as provided in Article XII.

         All Securities shall be substantially identical except as to
denomination and except as may otherwise be provided herein.

         SECTION 3.2.   Denominations.

         The Securities shall be in registered form without coupons and shall be
issuable in denominations of $1,000 and any integral multiple thereof.

         SECTION 3.3.   Execution, Authentication, Delivery and Dating.

         The Securities shall be executed on behalf of the Corporation by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, and attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Securities may be
manual or facsimile.

         Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Corporation shall bind the
Corporation, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities. At any time and from
time to time after the execution and delivery of this Indenture, the Corporation
may deliver Securities executed by the Corporation, having endorsed thereon
Guarantees duly executed by the Guarantor, to the Trustee for authentication,
together with a Corporation Order for the authentication and delivery of such
Securities, and the Trustee in accordance with the Corporation Order shall
authenticate and deliver such Securities as in this Indenture provided and not
otherwise.

         Each Security shall be dated the date of its authentication.

         No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by the manual signature of one of its authorized
officers, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder. Notwithstanding the foregoing, if any Security shall




                                      -24-




have been authenticated and delivered hereunder but never issued and sold by the
Corporation, and the Corporation shall deliver such Security to the Trustee for
cancellation as provided in Section 3.10, for all purposes of this Indenture
such Security shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.

         SECTION 3.4.   Temporary Securities.

         Pending the preparation of definitive Securities, the Corporation may
execute, and upon Corporation Order the Trustee shall authenticate and deliver,
temporary Securities, having endorsed thereon Guarantees duly executed by the
Guarantor, that are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Securities may determine, as evidenced by their execution of such
Securities.

         If temporary Securities are issued, the Corporation will cause
definitive Securities, having endorsed thereon Guarantees duly executed by the
Guarantor, to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities, having endorsed thereon Guarantees duly executed by the
Guarantor, upon surrender of the temporary Securities at the office or agency of
the Corporation designated for that purpose without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Securities, the
Corporation shall execute and the Trustee shall authenticate and deliver in
exchange therefor one or more definitive Securities, having endorsed thereon
Guarantees duly executed by the Guarantor, of any authorized denominations
having the same Original Issue Date and Stated Maturity and having the same
terms as such temporary Securities. Until so exchanged, the temporary Securities
shall in all respects be entitled to the same benefits under this Indenture as
definitive Securities.

         SECTION 3.5.   Global Securities.

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

         (b)    Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary advises the Trustee in writing that such
Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and the
Corporation does not appoint a qualified successor within 90 days, (ii) the
Corporation executes and delivers to the Trustee a Corporation Order stating
that the Corporation elects to terminate the book-entry system through the
Depositary, or (iii) a Debenture Default shall have occurred and be continuing.

         (c)    If any Global Security is to be exchanged for other Securities
or cancelled in whole, it shall be surrendered by or on behalf of the Depositary
or its nominee to the Securities Registrar for exchange or cancellation as
provided in this Article III. If any Global Security is to be exchanged for
other Securities or cancelled in part, or if another Security is to be exchanged
in whole or in part for a beneficial interest in any Global Security, then
either (i) such Global Security shall be so surrendered for




                                      -25-




exchange or cancellation as provided in this Article III or (ii) the principal
amount thereof shall be reduced, subject to Section 3.5(b)(v), or increased by
an amount equal to the portion thereof to be so exchanged or cancelled, or equal
to the principal amount of such other 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 Securities Registrar, whereupon the
Trustee, in accordance with the Applicable Procedures, shall instruct the
Depositary or its authorized representative to make a corresponding adjustment
to its records. Upon any such surrender or adjustment of a Global Security by
the Depositary, accompanied by registration instructions, the Trustee shall,
subject to Section 3.5(b) and as otherwise provided in this Article III,
authenticate and deliver any Securities issuable in exchange for such Global
Security (or any portion thereof) in accordance with the instructions of the
Depositary. The Trustee shall not be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be fully protected in
relying on, such instructions.

         (d)    Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article III, Section 9.6 or 11.6 or otherwise,
shall be authenticated and delivered in the form of, and shall be, a Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof.

         (e)    Securities distributed to holders of Book-Entry Capital
Securities (as defined in the Trust Agreement) upon the dissolution of the
Issuer Trust shall be distributed in the form of one or more Global Securities
registered in the name of a Depositary or its nominee, and deposited with the
Securities Registrar, as custodian for such Depositary, or with such Depositary,
for credit by the Depositary to the respective accounts of the beneficial owners
of the Securities represented thereby (or such other accounts as they may
direct). Securities distributed to holders of Capital Securities other than
Book-Entry Capital Securities upon the dissolution of the Issuer Trust shall not
be issued in the form of a Global Security or any other form intended to
facilitate book-entry trading in beneficial interests in such Securities.

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

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

         SECTION 3.6.   Registration, Transfer and Exchange Generally.

         The Corporation shall cause to be kept at the Corporate Trust Office of
the Trustee a register in which, subject to such reasonable regulations as it
may prescribe, the Corporation shall provide for the registration of Securities
and of transfers of Securities. Such register is herein sometimes referred to as
the "Securities Register." The Trustee is hereby appointed "Securities
Registrar" for the purpose of registering Securities and transfers of Securities
as herein provided.



                                      -26-




         Upon surrender for registration of transfer of any Security at the
offices or agencies of the Corporation designated for that purpose, the
Corporation shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Securities, having endorsed thereon Guarantees duly executed by the Guarantor,
of any authorized denominations of like tenor and aggregate principal amount.

         At the option of the Holder, Securities may be exchanged for other
Securities, having endorsed thereon Guarantees duly executed by the Guarantor,
of any authorized denominations, of like tenor and aggregate principal amount,
upon surrender of the Securities to be exchanged at such office or agency.
Whenever any securities are so surrendered for exchange, the Corporation shall
execute, and the Trustee shall authenticate and deliver, the Securities (having
Guarantees duly endorsed thereon) that the Holder making the exchange is
entitled to receive.

         All Securities and the Guarantees endorsed thereon issued upon any
transfer or exchange of Securities shall be the valid obligations of the
Corporation and the Guarantor, respectively, evidencing the same debt and
guarantee thereon, and entitled to the same benefits under this Indenture, as
the Securities and Guarantees surrendered upon such transfer or exchange.

         Every Security presented or surrendered for transfer or exchange shall
(if so required by the Corporation or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Corporation and the Securities Registrar, duly executed by the Holder thereof or
such Holder's attorney duly authorized in writing.

         No service charge shall be made to a Holder for any transfer or
exchange of Securities, but the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Securities.

         Neither the Corporation nor the Trustee shall be required, pursuant to
the provisions of this Section, (i) to issue, register the transfer of or
exchange any Security during a period beginning at the opening of business 15
days before the day of selection for redemption of Securities pursuant to
Article XI and ending at the close of business on the day of mailing of the
notice of redemption, or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except, in the case of
any such Security to be redeemed in part, any portion thereof not to be
redeemed.

         SECTION 3.7.   Mutilated, Destroyed, Lost and Stolen Securities.

         If any mutilated Security is surrendered to the Trustee together with
such security or indemnity as may be required by the Corporation or the Trustee
to save each of them harmless, the Corporation shall execute and the Trustee
shall authenticate and deliver in exchange therefor a new Security of the same
issue (having Guarantees duly endorsed thereon), of like tenor and aggregate
principal amount, and bearing a number not contemporaneously outstanding.

         If there shall be delivered to the Corporation and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security, and (ii) such security or indemnity as may be required by them to save
each of them, the Guarantor and any agent of any of them harmless, then, in the
absence of notice to the Corporation or the Trustee that such Security has been
acquired by a bona fide purchaser, the Corporation shall execute and upon its
request the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security, a new Security (having Guarantees duly
endorsed thereon), of like




                                      -27-




tenor and aggregate principal amount as such destroyed, lost or stolen Security,
and bearing a number not contemporaneously outstanding.

         If any such mutilated, destroyed, lost or stolen Security has become or
is about to become due and payable, the Corporation in its discretion may,
instead of issuing a new Security, pay such Security.

         Upon the issuance of any new Security under this Section, the
Corporation may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.

         Every new Security and the related Guarantees issued pursuant to this
Section in lieu of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Corporation and the Guarantor,
respectively, whether or not the destroyed, lost or stolen Security shall be at
any time enforceable by anyone, and shall be entitled to all the benefits of
this Indenture equally and proportionately with any and all other Securities
duly issued hereunder.

         The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.

         SECTION 3.8.   Payment of Interest and Additional Interest; Interest
Rights Preserved.

         Interest and Additional Interest on any Security which is payable, and
is punctually paid or duly provided for, on any Interest Payment Date, shall be
paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest in respect of the Securities, except that, interest and any
Additional Interest payable on the Stated Maturity of the principal of a
Security other than on an Interest Payment Date shall be paid to the Person to
whom principal is paid.

         Any interest on any Security that is due and payable, but is not timely
paid or duly provided for, on any Interest Payment Date for the Securities
(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 may be paid by the Corporation, at its election in
each case, as provided in Clause (1) or (2) below:

         (1)    The Corporation may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities in respect of which
interest is in default (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
Corporation shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security and the date of the proposed
payment, and at the same time the Corporation shall deposit with the Trustee an
amount of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this Clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest, which shall be
not more than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall promptly notify the
Corporation of such Special Record Date and, in




                                      -28-




the name and at the expense of the Corporation, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date therefor
to be mailed, first class, postage prepaid, to each Holder of a Security at the
address of such Holder as it appears in the Securities Register not less than 10
days prior to such Special Record Date. The Trustee may, in its discretion, in
the name and at the expense of the Corporation, cause a similar notice to be
published at least once in a newspaper, customarily published in the English
language on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, but such publication shall not be a condition
precedent to the establishment of 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 the Securities (or their respective Predecessor
Securities) are registered on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).

         (2)    The Corporation may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities in respect of which interest is in default may
be listed and, upon such notice as may be required by such exchange (or by the
Trustee if the Securities are not listed), if, after notice given by the
Corporation to the Trustee of the proposed payment pursuant to this Clause, such
payment shall be deemed practicable by the Trustee.

         Any interest on any Security which is deferred or extended pursuant to
Section 3.12 shall not be Defaulted Interest for purposes of this Section 3.8

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

         SECTION 3.9.   Persons Deemed Owners.

         The Corporation, the Guarantor, the Trustee and any agent of the
Corporation, the Guarantor or the Trustee shall treat the Person in whose name
any Security is registered as the owner of such Security for the purpose of
receiving payment of principal of and any premium and (subject to Section 3.8)
any interest on such Security and for all other purposes whatsoever, whether or
not such Security be overdue, and neither the Corporation, the Guarantor, the
Trustee nor any agent of the Corporation, the Guarantor or the Trustee shall be
affected by notice to the contrary.

         No holder of any beneficial interest in any Global Security held on its
behalf by a Depositary shall have any rights under this Indenture with respect
to such Global Security, and such Depositary may be treated by the Corporation,
the Trustee and any agent of the Corporation or the Trustee as the owner of such
Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Corporation, the Trustee or any agent of the
Corporation or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by a Depositary or impair, as between a
Depositary and such holders of beneficial interests, the operation of customary
practices governing the exercise of the rights of the Depositary (or its
nominee) as Holder of any Security.

         SECTION 3.10.  Cancellation.

         All Securities surrendered for payment, redemption, transfer or
exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee, and any such Securities and Securities




                                      -29-




surrendered directly to the Trustee for any such purpose shall be promptly
canceled by it. The Corporation may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
that the Corporation may have acquired in any manner whatsoever, and all
Securities so delivered shall be promptly canceled by the Trustee. No Securities
shall be authenticated in lieu of or in exchange for any Securities canceled as
provided in this Section, except as expressly permitted by this Indenture. All
canceled Securities shall be destroyed by the Trustee and the Trustee shall
deliver to the Corporation a certificate of such destruction.

         SECTION 3.11.  Computation of Interest.

         Interest on the Securities for any partial period shall be computed on
the basis of a 360-day year of twelve 30-day months and the actual number of
days elapsed in any partial month in such period, and interest on the Securities
for a full period shall be computed by dividing the rate per annum by the number
of interest periods that together constitute a full twelve months.

         SECTION 3.12.  Deferrals of Interest Payment Dates.

         So long as no Debenture Event of Default has occurred and is
continuing, the Corporation shall have the right, at any time during the term of
the Securities, from time to time to defer the payment of interest on the
Securities for a period not exceeding 10 consecutive semi-annual periods (each,
an "Extension Period"). No Extension Period shall end on a date other than an
Interest Payment Date. At the end of any such Extension Period the Corporation
shall pay all interest then accrued and unpaid on the Securities (together with
Additional Interest thereon, if any, at the rate specified for the Securities to
the extent permitted by applicable law); provided, however, that no Extension
Period shall extend beyond the Stated Maturity of the principal of the
Securities or end on a date other than an Interest Payment Date; and provided
further, however that during any such Extension Period, the Corporation and the
Guarantor shall 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 Corporation's or the Guarantor's capital stock, (ii) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Corporation that rank pari passu in all respects with
or junior in interest to the Securities or the Guarantees, respectively or (iii)
make any guarantee payments with respect to any guarantee by the Corporation or
the Guarantor if such guarantee ranks pari passu with or junior in interest to
the Securities or the Guarantees (other than (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Corporation or the
Guarantor in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors, consultants or independent contractors, in connection with
a dividend reinvestment or stockholder stock purchase plan or in connection with
the issuance of capital stock of the Corporation or the Guarantor (or securities
convertible into or exercisable for such capital stock) as consideration in an
acquisition transaction entered into prior to the applicable Extension Period,
(b) as a result of an exchange or conversion of any class or series of the
Corporation's or the Guarantor's capital stock (or any capital stock of a
Subsidiary of the Corporation or the Guarantor) for any class or series of the
Corporation's or the Guarantor's capital stock, respectively, or of any class or
series of the Corporation's or the Guarantor's indebtedness for any class or
series of the Corporation's or the Guarantor's capital stock, respectively, (c)
the purchase of fractional interests in shares of the Corporation's or the
Guarantor's capital stock, respectively, 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 Rights Plan, or the
issuance of rights, stock or other property under any 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




                                      -30-




which the dividend is being paid or ranks pari passu with or junior to such
stock). Prior to the termination of any such Extension Period, the Corporation
may further defer the payment of interest, provided that no Extension Period
shall exceed 10 consecutive semi-annual periods or extend beyond the Stated
Maturity of the principal of such Securities or end on a date other than an
Interest Payment Date. Upon the termination of any Extension Period and upon the
payment of all accrued and unpaid interest and any Additional Interest then due
on any Interest Payment Date, the Corporation may elect to begin a new Extension
Period, subject to the above conditions. No interest or Additional Interest,
other than Additional Sums, shall be due and payable during an Extension Period,
except at the end thereof. The Corporation shall give the Holders of Securities
and the Trustee notice of its election to begin any such Extension Period at
least one Business Day prior to the record date for the next succeeding Interest
Payment Date on which interest on the Securities would be payable but for such
deferral or, with respect to the Securities issued to the Issuer Trust, so long
as any such Securities are held by the Issuer Trust, at least one Business Day
prior to the earlier of (i) the next succeeding date on which Distributions on
the Capital Securities would be payable but for such deferral, and (ii) the date
on which the Property Trustee is required to give notice to any securities
exchange or other applicable self-regulatory organization or to holders of the
Capital Securities of the record date or the date such Distributions are
payable.

         The Trustee shall promptly give notice of the Corporation's election to
begin any such Extension Period to the Holders of the Outstanding Securities.

         SECTION 3.13.  Right of Set-Off.

         So long as the Securities are held by the Issuer Trust, notwithstanding
anything to the contrary herein, the Corporation and the Guarantor shall have
the right to set off any payment it is otherwise required to make in respect of
any such Security or the related Guarantee, respectively, to the extent the
Corporation or the Guarantor has theretofore made, or is concurrently on the
date of such payment making, a payment under the Guarantee Agreement relating to
such Security or to a holder of Capital Securities pursuant to an action
undertaken under Section 5.9 of this Indenture.

         SECTION 3.14.  Agreed Tax Treatment.

         Each Security issued hereunder shall provide that the Corporation and,
by its acceptance of a Security or a beneficial interest therein, the Holder of,
and any Person that acquires a beneficial interest in, such Security agree that
for United States Federal, State and local tax purposes it is intended that such
Security constitutes indebtedness.

         SECTION 3.15.  CUSIP Numbers.

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



                                      -31-




         SECTION 3.16.  Guarantee of Debt Securities.

         The Guarantor hereby irrevocably and unconditionally guarantees to each
Holder of a Security authenticated and delivered by the Trustee the due and
punctual payment of the principal of (including any amount in respect of
original issue discount), and any premium and interest (together with any
Additional Interest and Additional Sums payable pursuant to the terms of such
Security) on, such Security, provided for pursuant to the terms of such
Security, when and as the same shall become due and payable, whether at Stated
Maturity or upon redemption, acceleration or otherwise according to the terms of
such Security and of this Indenture. In case of default by the Corporation in
the payment of any such principal (including any amount in respect of original
issue discount), or any premium or interest (together with any Additional
Interest and Additional Sums payable pursuant to the terms of such Security),
the Guarantor agrees duly and punctually to pay the same. The Guarantor hereby
agrees that its obligations hereunder shall be as principal and not merely as
surety, and shall be absolute and unconditional irrespective of any invalidity,
irregularity or unenforceability of any such Security or this Indenture, any
failure to enforce the same or any waiver, modification, consent or indulgence
granted to the Corporation with respect thereto by the Holder of such Security
or the Trustee, or any other circumstances which may otherwise constitute a
legal or equitable discharge of a surety or guarantor. The Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of merger or bankruptcy of the Corporation, the Trustee, the Issuer
Trust or a trustee of the Issuer Trust, any right to require a demand or
proceeding first against the Corporation, protest or notice with respect to any
such Security or the indebtedness evidenced thereby and all demands whatsoever,
and covenants that this guarantee will not be discharged as to any such Security
except by payment in full of the principal of (including any amount payable in
respect of original issue discount), and any premium and interest (together with
any Additional Interest and Additional Sums payable pursuant to the terms of
such Security) on, such Security.

         The indebtedness evidenced by the Guarantee is, to the extent provided
in this Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior Debt, and the Guarantee is issued subject to the
provisions of this Indenture with respect thereto. Each Holder of the Guarantee,
by accepting the same, (a) shall agree to and shall be bound by such provisions,
(b) shall authorize and direct the Trustee on his or her behalf to take such
actions as may be necessary or appropriate to effectuate the subordination so
provided, and (c) shall appoint the Trustee his or her attorney-in-fact for any
and all such purposes. Each Holder shall waive all notice of the acceptance of
the subordination provisions contained in the Guarantee and in this Indenture by
each holder of Senior Debt, whether now outstanding or hereafter incurred, and
waives reliance by each such holder upon said provisions.

         All payments pursuant to the Guarantee shall be made without set-off,
counterclaim, fees, liabilities or similar deductions, and free and clear of,
and without deduction or withholding for, taxes, levies, imposts, duties,
charges or fees of whatsoever nature now or hereafter imposed, levied,
collected, deducted, withheld or assessed by or on behalf of the Commonwealth of
Puerto Rico or any political subdivision or taxing authority thereof or therein
("Taxes"). If the Guarantor or any agent thereof is required by law or
regulation to make any deduction or withholding for or on account of Taxes, the
Guarantor shall pay such additional amounts ("Additional Guarantee Payments") as
shall be necessary in order that the net amounts received pursuant to the
Guarantee by the Holders of Securities or the holders or beneficial owners of
any interest therein or rights in respect thereof after such deduction or
withholding shall equal the amount that would have been receivable thereunder in
the absence of such deduction or withholding, except that no such Additional
Guarantee Payments shall be payable:



                                      -32-




             (a)        to any Holder of a Security or any interest therein or
         rights in respect thereof where such deduction or withholding is
         required by reason of such Holder having some connection with the
         Commonwealth of Puerto Rico or any political subdivision or taxing
         authority thereof or thereon other than the mere holding of a payment
         in respect of such Security;

             (b)        in respect of any deduction or withholding that would
         not have been required but for the presentation by the Holder of a
         Security for payment on a date more than 30 days after the date on
         which payment thereof is duly provided for; or

             (c)        in respect of any deduction or withholding that would
         not have been required but for the failure to comply with any
         certification, identification or other reporting requirements
         concerning the nationality, residence, identity or connection with the
         Commonwealth of Puerto Rico, or any political subdivision or taxing
         authority thereof or therein, of the Holder of a Security or any
         interest therein or rights in respect thereof, if compliance is
         required by the Commonwealth of Puerto Rico, or any political
         subdivision or taxing authority thereof or therein, as a precondition
         to exemption from such deduction or withholding.

         The Guarantor irrevocably waives any and all rights to which it may be
entitled, by operation of law or otherwise, upon making payment hereunder (i) to
be subrogated to the rights of a Holder against the Corporation with respect to
such payment or otherwise to be reimbursed, indemnified or exonerated by the
Corporation in respect thereof or (ii) to receive any payment, in the nature of
contribution or for any other reason, from any other obligor with respect to
such payment.

         The guarantee set forth in this Section shall not be valid or become
obligatory for any purpose with respect to a Security until the certificate of
authentication on such Security shall have been signed by the Trustee.

         SECTION 3.17.  Execution of Guarantees.

         To evidence its guarantee specified in Section 3.16 to the Holders of
Securities, the Guarantor hereby agrees to execute the Guarantees in
substantially the form above recited to be endorsed on each Security
authenticated and delivered by the Trustee. Such Guarantees shall be executed on
behalf of the Guarantor by its Chairman or its Vice Chairman or its President or
any Vice President prior to the authentication of the Security on which it is
endorsed, and the delivery of such Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of such
Guarantees on behalf of the Guarantor. Typographical and other minor errors or
defects in any such reproduction of any signature shall not affect the validity
or enforceability of any Guarantee that has been duly authenticated and
delivered by the Trustee.

         Such signatures may be the manual or facsimile signatures of such
officers and may be imprinted or otherwise reproduced on the Guarantees. In case
any officer of the Guarantor who shall have signed any of the Guarantees shall
cease to be an officer before the Security on which such Guarantees are endorsed
shall have been authenticated and delivered by the Trustee or disposed of by the
Corporation, such Security nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Guarantees had not ceased to be
such officer, and any Guarantees may be signed on behalf of the Guarantor by
such persons as, at the actual date of the execution of such Guarantees, shall
be the proper officers of the Guarantor, although at the date of such Security
or of the execution of this Indenture any such person was not such an officer.



                                      -33-




                                   ARTICLE IV

                           SATISFACTION AND DISCHARGE

         SECTION 4.1.   Satisfaction and Discharge of Indenture.

         This Indenture shall, upon Corporation Request, cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for and as otherwise provided
in this Section 4.1) and the Trustee, on demand of and at the expense of the
Corporation, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when

         (1)    either

                (A)     all Securities theretofore authenticated and delivered
         (other than (i) Securities that have been destroyed, lost or stolen and
         that have been replaced or paid as provided in Section 3.7 and (ii)
         Securities for whose payment money has theretofore been deposited in
         trust or segregated and held in trust by the Corporation and thereafter
         repaid to the Corporation or discharged from such trust, as provided in
         Section 10.3) have been delivered to the Trustee for cancellation; or

                (B)     all such Securities not theretofore delivered to the
         Trustee for cancellation

                        (i)     have become due and payable, or

                        (ii)    will become due and payable at their Stated
                Maturity within one year of the date of deposit, or

                        (iii)   are to be called for redemption within one year

                under arrangements satisfactory to the Trustee for the giving of
                notice of redemption by the Trustee in the name, and at the
                expense, of the Corporation,

         and the Corporation, in the case of subclause (B)(i), (ii) or (iii)
         above, has irrevocably deposited or caused to be deposited with the
         Trustee as trust funds in trust for such purpose an amount in the
         currency or currencies in which the Securities are payable sufficient
         to pay and discharge the entire indebtedness on such Securities not
         theretofore delivered to the Trustee for cancellation, for principal
         (and premium, if any) and interest (including any Additional Interest)
         to the date of such deposit (in the case of Securities that have become
         due and payable) or to the Stated Maturity or Redemption Date, as the
         case may be;

         (2)    the Corporation or the Guarantor has paid or caused to be paid
all other sums payable hereunder by the Corporation; and

         (3)    the Corporation has delivered to the Trustee 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.

Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Corporation and the Guarantor to the Trustee under Section
6.7, the obligations of the Trustee to any Authenticating Agent under Section
6.14 and, if money shall have been irrevocably deposited with the Trustee
pursuant to





                                      -34-




subclause (B) of Clause (1) of this Section, the obligations of the Trustee
under Section 4.2 and the last paragraph of Section 10.3 shall survive.

         SECTION 4.2.   Application of Trust Money.

         Subject to the provisions of the last paragraph of Section 10.3, all
money deposited with the Trustee pursuant to Section 4.1 shall be held in trust
and applied by the Trustee, in accordance with the provisions of the Securities
and Guarantees and this Indenture, to the payment, either directly or through
any Paying Agent (including the Corporation acting as its own Paying Agent) as
the Trustee may determine, to the Persons entitled thereto, of the principal
(and premium, if any) and interest (including any Additional Interest) for the
payment of which such money or obligations have been deposited with or received
by the Trustee.

                                   ARTICLE V

                                    REMEDIES

         SECTION 5.1.   Debenture Event of Default

         "Debenture Event of Default", wherever used herein with respect to the
Securities, means any of the following events (whatever the reason for such
Debenture Event of Default and whether it shall be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):

         (1)    default in the payment of any interest upon any Security,
including any Additional Interest in respect thereof, when it becomes due and
payable, and continuance of such default for a period of 30 days following the
deferral of such interest for 10 consecutive semi-annual periods; or

         (2)    the entry of a decree or order by a court having jurisdiction in
the premises adjudging the Corporation or the Guarantor a bankrupt or insolvent,
or approving as properly filed a petition seeking reorganization of the
Corporation or the Guarantor under the Bankruptcy Code or any other similar
applicable Federal or State law, which decree or order shall have continued
undischarged and unstayed for a period of 60 days; or the entry of a decree or
order of a court having jurisdiction in the premises for the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or insolvency of the
Corporation or the Guarantor or of its property, or for the winding up or
liquidation of its affairs, which decree or order shall have continued
undischarged and unstayed for a period of 60 days; or

         (3)    the commencement by the Corporation or the Guarantor of
voluntary proceedings to be adjudicated a bankrupt, or consent by the
Corporation or the Guarantor to the filing of a bankruptcy proceeding against
it, or the filing by the Corporation or the Guarantor of a petition or answer or
consent seeking reorganization under the Bankruptcy Code or any other similar
Federal or State law, or consent by the Corporation or the Guarantor to the
filing of any such petition, or the consent by the Corporation or the Guarantor
to the appointment of a receiver or liquidator or trustee or assignee in
bankruptcy or insolvency of it or of its property, or the making by the
Corporation or the Guarantor of an assignment for the benefit of creditors, or
the admission by the Corporation or the Guarantor in writing of its inability to
pay its debts generally as they become due.



                                      -35-




         SECTION 5.2.   Debenture Default.

         "Debenture Default", wherever used herein with respect to the
Securities, means any event that is a Debenture Event of Default or any one of
the following events (whatever the reason for such Debenture Default and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):

         (1)    default in the payment of any interest upon any Security,
including any Additional Interest in respect thereof, when it becomes due and
payable, and continuance of such default for a period of 30 days (subject to the
deferral of any due date in the case of an Extension Period); or

         (2)    default in the payment of the principal of (or premium, if any,
on) any Security at its Maturity; or

         (3)    failure on the part of the Corporation or the Guarantor duly to
observe or perform any other of the covenants or agreements on the part of the
Corporation or the Guarantor, respectively, in the Securities or the Guarantees
endorsed thereon or in this Indenture for a period of 90 days after the date on
which written notice of such failure, requiring the Corporation or the
Guarantor, as the case may be, to remedy the same, shall have been given to the
Corporation and the Guarantor by the Trustee by registered or certified mail or
to the Corporation, the Guarantor and the Trustee by the Holders of at least 25%
in aggregate principal amount of the Outstanding Securities.

         SECTION 5.3.   Acceleration of Maturity; Rescission and Annulment.

         If a Debenture Event of Default specified in Section 5.1(1) with
respect to the Securities at the time Outstanding occurs and is continuing, then
and in every such case the Trustee or the Holders of not less than 25% in
aggregate principal amount of the Outstanding Securities may declare the
principal amount of all the Securities to be due and payable immediately, by a
notice in writing to the Corporation and the Guarantor (and to the Trustee if
given by Holders), provided that, so long as the Securities are held by the
Issuer Trust, if, upon such Debenture Event of Default, the Trustee or the
Holders of not less than 25% in principal amount of the Outstanding Securities
fail to declare the principal of all the Outstanding Securities to be
immediately due and payable, the holders of at least 25% in aggregate
Liquidation Amount of the corresponding Capital Securities then outstanding
shall have the right to make such declaration by a notice in writing to the
Corporation, the Guarantor and the Trustee; and upon any such declaration such
principal amount (or specified portion thereof) of and the accrued interest
(including any Additional Interest) on all the Securities shall become
immediately due and payable. If a Debenture Event of Default specified in
Section 5.1(2) or 5.1(3) with respect to the Securities at the time Outstanding
occurs, the principal amount of all the Securities shall automatically, and
without any declaration or other action on the part of the Trustee or any
Holder, become immediately due and payable. Payment of principal and interest
(including any Additional Interest) on such Securities shall remain subordinated
to the extent provided in Article XII notwithstanding that such amount shall
become immediately due and payable as herein provided.

         At any time after such a declaration of acceleration with respect to
the Securities has been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this Article
provided, the Holders of a majority in aggregate principal amount of the
Outstanding Securities, by written notice to the Corporation, the Guarantor and
the Trustee, may rescind and annul such declaration and its consequences if:



                                      -36-




         (1)    the Corporation or the Guarantor has paid or deposited with the
Trustee a sum sufficient to pay:

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

         (B)    any Additional Sums and accrued Additional Interest on all
Securities,

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

         (D)    all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel; and

         (2)    all Events of Default with respect to Securities, other than the
non-payment of the principal of the Securities which has become due solely by
such acceleration, have been cured or waived as provided in Section 5.14.

         In the case of Securities held by the Issuer Trust, if the Holders of
such Securities fail to annul such declaration and waive such default, the
holders of a majority in aggregate Liquidation Amount of the corresponding
Capital Securities then outstanding shall also have the right to rescind and
annul such declaration and its consequences by written notice to the
Corporation, the Guarantor and the Trustee, subject to the satisfaction of the
conditions set forth in Clauses (1) and (2) above of this Section 5.3.

         No such rescission shall affect any subsequent default or impair any
right consequent thereon.

         SECTION 5.4.   Collection of Indebtedness and Suits for Enforcement by
Trustee.

         Each of the Corporation and the Guarantor covenants that if:

         (1)    default is made in the payment of any installment of interest
(including any Additional Interest) on any Security when such interest becomes
due and payable and such default continues for a period of 30 days, or

         (2)    default is made in the payment of the principal of (and premium,
if any, on) any Security at the Maturity thereof,

         the Corporation and the Guarantor will, upon demand of the Trustee, pay
to the Trustee, for the benefit of the Holders of such Securities, the whole
amount then due and payable on such Securities for principal (and premium, if
any) and interest (including any Additional Interest), and, in addition thereto,
all amounts owing the Trustee under Section 6.7.

         If the Corporation and the Guarantor fail to pay such amounts forthwith
upon such demand, the Trustee, in its own name and as trustee of an express
trust, may institute a judicial proceeding for the collection of the sums so due
and unpaid, and may prosecute such proceeding to judgment or final decree, and
may enforce the same against the Corporation and the Guarantor or any other
obligor upon such Securities and collect the moneys adjudged or decreed to be
payable in the manner provided by law out of the property of the Corporation and
the Guarantor or any other obligor upon the Securities, wherever situated.



                                      -37-




         If a Debenture Default with respect to the Securities occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in this Indenture or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy; provided, however, that in the event of a
Debenture Default that is not a Debenture Event of Default, there is no right to
declare the principal amount of the Securities immediately payable.

         SECTION 5.5.   Trustee May File Proofs of Claim.

         In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Corporation or the Guarantor (or any other obligor
upon the Securities), or the property of the Corporation or the Guarantor or of
such other obligor or their creditors,

             (a)        the Trustee (irrespective of whether the principal of
         the Securities shall then be due and payable as therein expressed or by
         declaration or otherwise and irrespective of whether the Trustee shall
         have made any demand on the Corporation or the Guarantor for the
         payment of overdue principal (and premium, if any) or interest
         (including any Additional Interest)) shall be entitled and empowered,
         by intervention in such proceeding or otherwise,

                        (i)     to file and prove a claim for the whole amount
             of principal (and premium, if any) and interest (including any
             Additional Interest) owing and unpaid in respect to the Securities
             and to file such other papers or documents as may be necessary or
             advisable and to take any and all actions as are authorized under
             the Trust Indenture Act in order to have the claims of the Holders
             and any predecessor to the Trustee under Section 6.7 allowed in any
             such judicial proceedings; and

                        (ii)    in particular, the Trustee shall be authorized
             to collect and receive any moneys or other property payable or
             deliverable on any such claims and to distribute the same in
             accordance with Section 5.7; and

             (b)        any custodian, receiver, assignee, trustee, liquidator,
         sequestrator (or other similar official) in any such judicial
         proceeding is hereby authorized by each Holder to make such payments to
         the Trustee for distribution in accordance with Section 5.7, and in the
         event that the Trustee shall consent to the making of such payments
         directly to the Holders, to pay to the Trustee any amount due to it and
         any predecessor Trustee under Section 6.7.

         Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.

         SECTION 5.6.   Trustee May Enforce Claim Without Possession of
Securities.

         All rights of action and claims under this Indenture or the Securities
or the Guarantees may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or the Guarantees




                                      -38-




or the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall, subject to Article XII
and after provision for the payment of all the amounts owing the Trustee and any
predecessor Trustee under Section 6.7, its agents and counsel, be for the
ratable benefit of the Holders of Securities in respect of which such judgment
has been recovered.

         SECTION 5.7.   Application of Money Collected.

         Any money or property collected or to be applied by the Trustee with
respect to the Securities or the Guarantees thereon pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money or property on account of
principal (or premium, if any) or interest (including any Additional Interest),
upon presentation of the Securities and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:

         FIRST: To the payment of all amounts due the Trustee and any
predecessor Trustee under Section 6.7;

         SECOND: Subject to Article XII, to the payment of the amounts then due
and unpaid upon the Securities for principal (and premium, if any) and interest
(including any Additional Interest) in respect of which or for the benefit of
which such money has been collected, ratably, without preference or priority of
any kind, according to the amounts due and payable on the Securities for
principal (and premium, if any) and interest (including any Additional
Interest), respectively; and

         THIRD: The balance, if any, to the Person or Persons entitled thereto.

         SECTION 5.8.   Limitation on Suits.

         Subject to Section 5.9, no Holder of Securities shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture
or for the appointment of a receiver, assignee, trustee, liquidator,
sequestrator (or other similar official) or for any other remedy hereunder,
unless:

         (1)    such Holder has previously given written notice to the Trustee
of a continuing Debenture Default with respect to the Securities;

         (2)    the Holders of not less than 25% in aggregate principal amount
of the Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Debenture Default in its own name as
Trustee hereunder;

         (3)    such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;

         (4)    the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such proceeding; and

         (5)    no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority in
aggregate principal amount of the Outstanding Securities;

it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing itself of, any
provision of this Indenture to affect, disturb or




                                      -39-




prejudice the rights of any other Holders of Securities, or to obtain or to seek
to obtain priority or preference over any other of such Holders or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal and ratable benefit of all such Holders.

         SECTION 5.9.   Unconditional Right of Holders to Receive Principal,
Premium and Interest; Direct Action by Holders of Capital Securities.

         Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Sections 3.8 and 3.12) interest (including any Additional Interest) on such
Security on the respective Stated Maturities expressed in such Security (or, in
the case of redemption, on the Redemption Date) and to institute suit for the
enforcement of any such payment, and such right shall not be impaired without
the consent of such Holder. So long as the Securities are held by the Issuer
Trust, any registered holder of the corresponding Capital Securities shall have
the right, upon the occurrence of a Debenture Default, to institute a suit
directly against the Corporation or the Guarantor for enforcement of payment to
such holder of principal of (premium, if any) and (subject to Sections 3.8 and
3.12) interest (including any Additional Interest) on the Securities having a
principal amount equal to the aggregate Liquidation Amount of such Capital
Securities held by such holder.

         SECTION 5.10.  Restoration of Rights and Remedies.

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

         SECTION 5.11.  Rights and Remedies Cumulative.

         Except as otherwise provided in the last paragraph of Section 3.7, no
right or remedy herein conferred upon or reserved to the Trustee or the Holders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

         SECTION 5.12.  Delay or Omission Not Waiver.

         No delay or omission of the Trustee, any Holder of any Security or any
holder of any Capital Security to exercise any right or remedy accruing upon any
Debenture Default shall impair any such right or remedy or constitute a waiver
of any such Debenture Default or an acquiescence therein.

         Every right and remedy given by this Article or by law to the Trustee
or to the Holders and the right and remedy given to the holders of Capital
Securities by Section 5.9 may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee, the Holders or the holders of Capital
Securities, as the case may be.




                                      -40-




         SECTION 5.13.  Control by Holders.

         The Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities and the holders of a majority in liquidation
amount of the Capital Securities 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 the
Securities, provided that:

         (1)    such direction shall not be in conflict with any rule of law or
with this Indenture,

         (2)    the Trustee may take any other action deemed proper by the
Trustee that is not inconsistent with such direction, and

         (3)    subject to the provisions of Section 6.1, the Trustee shall have
the right to decline to follow such direction if a Responsible Officer or
Officers of the Trustee shall, in good faith, determine that the proceeding so
directed would be unjustly prejudicial to the Holders not joining in any such
direction or would involve the Trustee in personal liability.

         SECTION 5.14.  Waiver of Past Defaults.

         The Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities affected thereby and, in the case of any
Securities held by the Issuer Trust, the holders of a majority in aggregate
Liquidation Amount of the Capital Securities may waive any past default
hereunder and its consequences with respect to the Securities except a default:

         (1)    in the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Security (unless such
default has been cured and the Corporation or Guarantor has paid to or deposited
with the Trustee a sum sufficient to pay all matured installments of interest
(including any Additional Interest) and all principal of (and premium, if any,
on) all Securities due otherwise than by acceleration), or

         (2)    in respect of a covenant or provision hereof that under Article
IX cannot be modified or amended without the consent of each Holder of any
Outstanding Security affected.

         Any such waiver shall be deemed to be on behalf of the Holders of all
the Securities or, in the case of a waiver by holders of Capital Securities, by
all holders of Capital Securities.

         Upon any such waiver, such default shall cease to exist, and any
Debenture Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.

         SECTION 5.15.  Undertaking for Costs.

         All parties to this Indenture agree, and each Holder of any Security by
his 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,
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




                                      -41-




any suit instituted by the Trustee, to any suit instituted by any Holder, or
group of Holders, holding in the aggregate more than 10% in aggregate principal
amount of the Outstanding Securities, or to any suit instituted by any Holder or
registered holder of Capital Securities for the enforcement of the payment of
the principal of (or premium, if any) or interest (including any Additional
Interest) on any Security on or after the respective Stated Maturities expressed
in such Security.

         SECTION 5.16.  Waiver of Usury, Stay or Extension Laws.

         Each of the Corporation and the Guarantor covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any usury, stay
or extension law wherever enacted, now or at any time hereafter in force, which
may affect the covenants or the performance of this Indenture; and each of the
Corporation and the Guarantor (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.

                                   ARTICLE VI

                                   THE TRUSTEE

         SECTION 6.1.   Certain Duties and Responsibilities.

         (a)    Except during the continuance of a Debenture Default,

         (1)    the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the Trustee; and

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

         (b)    In case a Debenture Default has occurred and is continuing, 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
his or her own affairs.

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

         (1)    this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;

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



                                      -42-




         (3)    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
Holders pursuant to Section 5.13 relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Indenture with respect
to the Securities.

         (d)    No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

         (e)    Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.

         SECTION 6.2.   Notice of Defaults.

         Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of the occurrence of any default hereunder with respect to the
Securities, the Trustee shall transmit by mail to all Holders of Securities, as
their names and addresses appear in the Securities Register, notice of such
default, unless such default shall have been cured or waived; provided, however,
that, except in the case of a default in the payment of the principal of (or
premium, if any) or interest (including any Additional Interest) on any
Security, the Trustee shall be protected in withholding such notice if and so
long as the board of directors, the executive committee or a trust committee of
directors and/or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interests of the Holders of
Securities; and provided, further, that, in the case of any default of the
character specified in Section 5.2(3), no such notice to Holders of Securities
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event that is, or after
notice or lapse of time or both would become, a Debenture Default with respect
to the Securities.

         SECTION 6.3.   Certain Rights of Trustee.

         Subject to the provisions of Section 6.1:

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

         (b)    any request or direction of the Corporation or the Guarantor
mentioned herein shall be sufficiently evidenced by a Corporation or Guarantor
Request or Corporation or Guarantor Order and any resolution of the Board of
Directors may be sufficiently evidenced by a Board Resolution;

         (c)    whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;



                                      -43-




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

         (e)    the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities that might be incurred by it in compliance with such
request or direction;

         (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, direction, consent, order, bond,
indenture, Security or other paper or document, but the Trustee in its
discretion may make such inquiry or investigation into such facts or matters as
it may see fit, and, if the Trustee shall determine to make such inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Corporation, personally or by agent or attorney; 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 or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.

         SECTION 6.4.   Not Responsible for Recitals or Issuance of Securities.

         The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Corporation and the Guarantor, and neither the Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities. Neither the Trustee nor any Authenticating Agent
shall be accountable for the use or application by the Corporation of the
Securities or the proceeds thereof.

         SECTION 6.5.   May Hold Securities.

         The Trustee, any Authenticating Agent, any Paying Agent, any Securities
Registrar or any other agent of the Corporation or the Guarantor, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to Sections 6.8 and 6.13, may otherwise deal with the Corporation
or the Guarantor with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Securities Registrar or such other agent.

         SECTION 6.6.   Money Held in Trust.

         Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Corporation or the Guarantor.

         SECTION 6.7.   Compensation and Reimbursement.

         Each of the Corporation and the Guarantor agrees



                                      -44-




         (1)    to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder in such amounts as the Corporation and
the Trustee shall agree 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);

         (2)    to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (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 its
negligence or bad faith; and

         (3)    to indemnify the Trustee for, and to hold it harmless against,
any loss, liability or expense (including the reasonable compensation and the
expenses and disbursements of its agents and counsel) incurred without
negligence or bad faith, arising out of or in connection with the acceptance or
administration of this trust or the performance of its duties hereunder,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder. This indemnification shall survive the termination of this
Indenture.

         When the Trustee incurs expenses or renders services after a Debenture
Event of Default specified in Section 5.1(2) or 5.1(3) occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under the Bankruptcy Reform Act of 1978 or any successor statute.

         SECTION 6.8.   Disqualification; Conflicting Interests.

         (a)    The Trustee for the Securities issued hereunder shall be subject
to the provisions of Section 310(b) of the Trust Indenture Act. Nothing herein
shall prevent the Trustee from filing with the Commission the application
referred to in the second to last paragraph of said Section 310(b).

         (b)    The Trust Agreement and the Guarantee Agreement shall be deemed
to be specifically described in this Indenture for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.

         SECTION 6.9.   Corporate Trustee Required; Eligibility.

         There shall at all times be a Trustee hereunder which shall be:

         (a)    a corporation organized and doing business under the laws of the
United States or of any State or Territory or the District of Columbia or the
Commonwealth of Puerto Rico, authorized under such laws to exercise corporate
trust powers and subject to supervision or examination by Federal, State,
Territorial, District of Columbia or Puerto Rican authority, or

         (b)    a corporation or other Person organized and doing business under
the laws of a foreign government that is permitted to act as Trustee pursuant to
a rule, regulation or order of the Commission, authorized under such laws to
exercise corporate trust powers, and subject to supervision or examination by
authority of such foreign government or a political subdivision thereof
substantially equivalent to supervision or examination applicable to United
States institutional trustees, in either case having a combined capital and
surplus of at least $50,000,000, subject to supervision or examination by
Federal or State authority. If such corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then, for the purposes of this




                                      -45-




Section 6.9, 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 the Trustee shall cease to be
eligible in accordance with the provisions of this Section 6.9, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article VI. Neither the Corporation, the Guarantor nor any Person directly or
indirectly controlling, controlled by or under common control with the
Corporation or the Guarantor shall serve as Trustee for the Securities issued
hereunder.

         SECTION 6.10.  Resignation and Removal; Appointment of Successor.

         (a)    No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article VI shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.

         (b)    The Trustee may resign at any time by giving written notice
thereof to the Corporation and the Guarantor. If an instrument of acceptance by
a successor Trustee shall not have been delivered to the Trustee within 30 days
after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.

         (c)    The Trustee may be removed at any time by Act of the Holders of
a majority in aggregate principal amount of the Outstanding Securities,
delivered to the Trustee and to the Corporation and the Guarantor.

         (d)    If at any time:

         (1)    the Trustee shall fail to comply with Section 6.8 after written
request therefor by the Corporation, the Guarantor or by any Holder who has been
a bona fide Holder of a Security for at least six months, or

         (2)    the Trustee shall cease to be eligible under Section 6.9 and
shall fail to resign after written request therefor by the Corporation, the
Guarantor or by any such Holder, or

         (3)    the Trustee shall become incapable of acting or shall be
adjudged a 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, (i) the Corporation, acting pursuant to the authority of
a Board Resolution, may remove the Trustee, or (ii) subject to Section 5.15, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of such Holder and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee or Trustees.

         (e)    If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Corporation, by a Board Resolution, shall promptly appoint a successor Trustee.
If, within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in aggregate principal amount of the Outstanding
Securities delivered to the Corporation, the Guarantor and the retiring Trustee,
the successor Trustee so appointed shall, forthwith upon its acceptance of such





                                      -46-




appointment, become the successor Trustee and supersede the successor Trustee
appointed by the Corporation. If no successor Trustee shall have been so
appointed by the Corporation or the Holders and accepted appointment in the
manner hereinafter provided, any Holder who has been a bona fide Holder of a
Security for at least six months may, subject to Section 5.15, on behalf of such
Holder and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities.

         (f)    The Corporation shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Securities as their names and addresses appear in the Securities
Register. Each notice shall include the name of the successor Trustee and the
address of its Corporate Trust Office.

         SECTION 6.11.  Acceptance of Appointment by Successor.

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

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

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

         SECTION 6.12.  Merger, Conversion, Consolidation or Succession to
Business.

         Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated, and in case any
Securities shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any predecessor Trustee or in
the name of such successor Trustee, and in all cases the certificate of
authentication shall have the full force which it is provided anywhere in the
Securities or in this Indenture that the certificate of the Trustee shall have.



                                      -47-




         SECTION 6.13.  Preferential Collection of Claims Against Corporation or
Guarantor.

         If and when the Trustee shall be or become a creditor of the
Corporation or the Guarantor (or any other obligor upon the Securities), the
Trustee shall be subject to the provisions of the Trust Indenture Act regarding
the collection of claims against the Corporation or the Guarantor (or any such
other obligor).

         SECTION 6.14.  Appointment of Authenticating Agent.

         The Trustee may appoint an Authenticating Agent or Agents, which shall
be authorized to act on behalf of the Trustee to authenticate Securities issued
upon original issue and upon exchange, registration of transfer or partial
redemption thereof or pursuant to Section 3.6, and Securities so authenticated
shall be entitled to the benefits of this Indenture and shall be valid and
obligatory for all purposes as if authenticated by the Trustee hereunder.
Wherever reference is made in this Indenture to the authentication and delivery
of Securities by the Trustee or the Trustee's certificate of authentication,
such reference shall be deemed to include authentication and delivery on behalf
of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Corporation and shall at all times be a corporation organized
and doing business under the laws of the United States, or of any State or
Territory thereof or the District of Columbia or the Commonwealth of Puerto
Rico, authorized under such laws to act as Authenticating Agent, having a
combined capital and surplus of not less than $50,000,000 and subject to
supervision or examination by Federal, State, Territorial, District of Columbia
or Puerto Rican authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section the
combined capital and surplus of such Authenticating Agent 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 Agent shall cease to be
eligible in accordance with the provisions of this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.

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

         An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Corporation and the Guarantor. The Trustee may
at any time terminate the agency of an Authenticating Agent by giving written
notice thereof to such Authenticating Agent and to the Corporation and the
Guarantor. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time such Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, the Trustee may
appoint a successor Authenticating Agent, which shall be acceptable to the
Corporation and shall give notice of such appointment in the manner provided in
Section 1.6 to all Holders of Securities. Any successor Authenticating Agent
upon acceptance of its appointment hereunder shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like effect as if
originally named as an Authenticating Agent. No successor Authenticating Agent
shall be appointed unless eligible under the provision of this Section.

         The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 6.7.



                                      -48-




         If an appointment is made pursuant to this Section, the Securities may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:

         This is one of the Securities described in the within-mentioned
Indenture.

Dated:

                                        THE BANK OF NEW YORK MELLON,
                                        as Trustee


                                        By:
                                           -------------------------------------
                                                  As Authenticating Agent


                                        By:
                                           -------------------------------------
                                                   Authorized officer


                                  ARTICLE VII

              HOLDER'S LISTS AND REPORTS BY TRUSTEE AND CORPORATION

         SECTION 7.1.   Corporation to Furnish Trustee Names and Addresses of
Holders.

         The Corporation will furnish or cause to be furnished to the Trustee:

             (a)        semi-annually, on or before June 30 and December 31 of
         each year, a list, in such form as the Trustee may reasonably require,
         of the names and addresses of the Holders as of a date not more than 15
         days prior to the delivery thereof, and

             (b)        at such other times as the Trustee may request in
         writing, within 30 days after the receipt by the Corporation 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,

in each case to the extent such information is in the possession or control of
the corporation and has not otherwise been received by the Trustee in its
capacity as Securities Registrar.

         SECTION 7.2.   Preservation of Information, Communications to Holders.

         (a)    The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 7.1 and the names
and addresses of Holders received by the Trustee in its capacity as Securities
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished.



                                      -49-




         (b)    The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided in the
Trust Indenture Act.

         (c)    Every Holder of Securities, by receiving and holding the same,
agrees with the Corporation, the Guarantor and the Trustee that none of the
Corporation, the Guarantor nor the Trustee nor any agent of any of them shall be
held accountable by reason of the disclosure of information as to the names and
addresses of the Holders made pursuant to the Trust Indenture Act.

         SECTION 7.3.   Reports by Trustee.

         (a)    The Trustee shall transmit to Holders such reports concerning
the Trustee and its actions under this Indenture as may be required pursuant to
the Trust Indenture Act, at the times and in the manner provided pursuant
thereto.

         (b)    Reports so required to be transmitted at stated intervals of not
more than 12 months shall be transmitted no later than January 31 in each
calendar year.

         (c)    A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each securities exchange
upon which any Securities are listed and also with the Commission. The
Corporation will notify the Trustee when any Securities are listed on any
securities exchange.

         SECTION 7.4.   Reports by Corporation.

         The Corporation and the Guarantor shall file with the Trustee and with
the Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided in the Trust Indenture
Act; provided that any such information, documents or reports required to be
filed with the Commission pursuant to Section 13 or Section 15(d) of the
Exchange Act shall be filed with the Trustee within 15 days after the same is
required to be filed with the Commission. Notwithstanding that the Guarantor may
not be required to remain subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act, the Guarantor shall continue to file with the
Commission and provide the Trustee with the annual reports and the information,
documents and other reports which are specified in Sections 13 and 15(d) of the
Exchange Act. The Corporation and the Guarantor also shall comply with the other
provisions of Trust Indenture Act Section 314(a).

                                  ARTICLE VIII

              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

         SECTION 8.1.   Corporation and Guarantor May Consolidate, Etc., Only on
Certain Terms.

         Neither the Guarantor nor the Corporation shall consolidate with or
merge into any other Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, and no Person shall
consolidate with or merge into the Guarantor or the Corporation or convey,
transfer or lease its properties and assets substantially as an entirety to the
Guarantor or the Corporation, unless:



                                      -50-




         (1)    if the Guarantor or the Corporation shall consolidate with or
merge into another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the corporation formed by such
consolidation or into which the Guarantor or the Corporation is merged or the
Person that acquires by conveyance or transfer, or that leases, the properties
and assets of the Guarantor or the Corporation substantially as an entirety
shall be a corporation, partnership or trust organized and existing under the
laws of the United States or any State or Territory thereof or the District of
Columbia or the Commonwealth of Puerto Rico and shall, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form satisfactory
to the Trustee, (i) in the case of the Guarantor, expressly guarantee, or (ii)
in the case of the Corporation, expressly assume, the due and punctual payment
of the principal of (and premium, if any) and interest (including any Additional
Interest) on all the Securities and the performance of every covenant of this
Indenture on the part of the Guarantor or the Corporation, as the case may be,
to be performed or observed (and in the event such Person is organized and
existing under the laws of the Commonwealth of Puerto Rico, such Person accepts
the additional obligation to make such payments without withholding of, or
deduction for, any taxes, of whatever nature imposed or levied by or on behalf
of the Commonwealth of Puerto Rico);

         (2)    immediately after giving effect to such transaction, no
Debenture Default, and no event that, after notice or lapse of time, or both,
would constitute a Debenture Default, shall have happened and be continuing; and

         (3)    the Guarantor or the Corporation, as the case may be, has
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger, conveyance, transfer or lease and
any such supplemental indenture comply with this Article and that all conditions
precedent herein provided for relating to such transaction have been complied
with; and the Trustee, subject to Section 6.1, may rely upon such Officers'
Certificate and Opinion of Counsel as conclusive evidence that such transaction
complies with this Section 8.1.

         SECTION 8.2.   Successor Corporation Substituted.

         Upon any consolidation or merger by the Guarantor or the Corporation,
as the case may be, with or into any other Person, or any conveyance, transfer
or lease by the Guarantor or the Corporation of its properties and assets
substantially as an entirety to any Person in accordance with Section 8.1, the
successor corporation formed by such consolidation or into which the Guarantor
or the Corporation, as the case may be, is merged or to which such conveyance,
transfer or lease is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Guarantor or the Corporation, as the case
may be, under this Indenture with the same effect as if such successor Person
had been named as the Guarantor or the Corporation, as the case may be, herein;
and in the event of any such conveyance, transfer or lease the Guarantor or the
Corporation, as the case may be, shall be discharged from all obligations and
covenants under this Indenture and the Securities and the Guarantees, as the
case may be.

         Such successor Person may cause to be executed, and may issue either in
its own name or in the name of the Corporation, any or all of the Securities
issuable hereunder that theretofore shall not have been signed by the
Corporation, and having endorsed thereon Guarantees duly executed by the
Guarantor, and delivered to the Trustee; and, upon the order of such successor
Person instead of the Corporation and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee shall authenticate and
shall deliver any Securities having endorsed thereon Guarantees duly executed by
the Guarantor, that previously shall have been signed and delivered by the
officers of the Corporation to the Trustee for authentication pursuant to such
provisions and any Securities that such successor Person thereafter shall cause
to be executed and delivered to the Trustee on its behalf for the purpose
pursuant to




                                      -51-




such provisions. All the Securities so issued shall in all respects have the
same legal rank and benefit under this Indenture as the Securities theretofore
or thereafter issued in accordance with the terms of this Indenture.

         In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form may be made in the Securities thereafter to
be issued as may be appropriate.

                                   ARTICLE IX

                             SUPPLEMENTAL INDENTURES

         SECTION 9.1.   Supplemental Indentures without Consent of Holders.

         Without the consent of any Holders, the Corporation and the Guarantor,
when authorized by Board Resolutions, and the Trustee, at any time and from time
to time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:

             (1)        to evidence the succession of another Person to the
         Corporation or the Guarantor, and the assumption by any such successor
         of the covenants of the Corporation or Guarantor herein and in the
         Securities and Guarantees contained; or

             (2)        to convey, transfer, assign, mortgage or pledge any
         property to or with the Trustee or to surrender any right or power
         herein conferred upon the Corporation or Guarantor; or

             (3)        to add to the covenants of the Corporation or the
         Guarantor for the benefit of the Holders of Securities or to surrender
         any right or power herein conferred upon the Corporation or the
         Guarantor; or

             (4)        to add any additional Debenture Events of Default and
         Debenture Defaults for the benefit of the Holders of Securities; or

             (5)        to cure any ambiguity, to correct or supplement any
         provision herein that may be defective or inconsistent with any other
         provision herein, or to make any other provisions with respect to
         matters or questions arising under this Indenture, provided that such
         action pursuant to this clause (5) shall not adversely affect the
         interest of the Holders of Securities in any material respect or, for
         so long as any of the Capital Securities shall remain outstanding, the
         holders of such Capital Securities; or

             (6)        to evidence and provide for the acceptance of
         appointment hereunder by a successor Trustee with respect to the
         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 6.11(b); or

             (7)        to comply with the requirements of the Commission in
         order to effect or maintain qualification of this Indenture under the
         Trust Indenture Act.

         SECTION 9.2.   Supplemental Indentures with Consent of Holders.

         With the consent of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities, by Act of said Holders
delivered to the Corporation, the Guarantor and the




                                      -52-




Trustee, the Corporation, when authorized by a Board Resolution, the Guarantor,
when authorized by a Board Resolution, and the Trustee may enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of modifying in any manner the rights of the Holders of
Securities under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security,

         (1)    except to the extent permitted by Section 3.11 with respect to
the deferral of the payment of interest on the Securities, change the Stated
Maturity of the principal of, or any installment of interest (including any
Additional Interest) on, any Security, or reduce the principal amount thereof or
the rate of interest thereon or any premium payable upon the redemption thereof,
or change the Redemption Date, redemption events or Redemption Prices, or change
the place of payment where, or the coin or currency in which, any Security or
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity thereof (or, in
the case of redemption, on or after the Redemption Date), or

         (2)    reduce the percentage in aggregate principal amount of the
Outstanding Securities, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture, or

         (3)    modify any of the provisions of this Section, Section 5.4 or
Section 10.5, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Security affected thereby;

provided, further, that, so long as any of the Capital Securities remains
outstanding, (i) no such modification or amendment shall be made that adversely
affects the holders of such Capital Securities in any material respect, and no
termination of this Indenture shall occur, and no waiver of any Debenture
Default or compliance with any covenant under this Indenture shall be effective,
without the prior consent of the holders of at least a majority of the aggregate
Liquidation Amount of such Capital Securities then outstanding unless and until
the principal of (and premium, if any, on) the Securities and all accrued and
(subject to Section 3.8) unpaid interest (including any Additional Interest)
thereon have been paid in full, and (ii) no amendment shall be made to Section
5.9 of this Indenture that would impair the rights of the holders of Capital
Securities provided therein without the prior consent of the holders of each
Capital Security then outstanding unless and until the principal of (and
premium, if any, on) the Securities and all accrued and (subject to Section
3.12) unpaid interest (including any Additional Interest) thereon have been paid
in full.

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

         SECTION 9.3.   Execution of Supplemental Indentures.

         In executing or accepting the additional trusts created by any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 6.1) shall be fully protected in relying upon, an
Officers' Certificate and an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture, and
that all conditions precedent herein provided for relating to




                                      -53-




such action have been complied with. The Trustee may, but shall not be obligated
to, enter into any such supplemental indenture that affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.

         SECTION 9.4.   Effect of Supplemental Indentures.

         Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.

         SECTION 9.5.   Conformity with Trust Indenture Act.

         Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.

         SECTION 9.6.   Reference in Securities to Supplemental Indentures.

         Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Corporation, bear a notation in form approved by the Corporation as to any
matter provided for in such supplemental indenture. If the Corporation shall so
determine, new Securities so modified as to conform, in the opinion of the
Corporation, to any such supplemental indenture may be prepared and executed by
the Corporation and authenticated and delivered by the Trustee in exchange for
Outstanding Securities.

                                   ARTICLE X

                                    COVENANTS

         SECTION 10.1.  Payment of Principal, Premium and Interest.

         The Corporation covenants and agrees that it will duly and punctually
pay the principal of (and premium, if any) and interest (including any
Additional Interest) on the Securities in accordance with the terms of such
Securities and this Indenture.

         SECTION 10.2.  Maintenance of Office or Agency.

         The Corporation will maintain in each Place of Payment for the
Securities an office or agency where Securities may be presented or surrendered
for payment, where Securities may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Corporation in respect of
the Securities and this Indenture may be served. The Corporation initially
appoints the Trustee, acting through its Corporate Trust Office, as its agent
for said purposes. The Corporation will give prompt written notice to the
Trustee of any change in the location of any such office or agency. If at any
time the Corporation shall fail to maintain such office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Corporation hereby appoints the Trustee as its agent to receive
all such presentations, surrenders, notices and demands.


                                      -54-





         The Corporation may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all of such purposes, and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Corporation of its obligation to maintain an office or agency in
each Place of Payment for the Securities for such purposes. The Corporation will
give prompt written notice to the Trustee of any such designation and any change
in the location of any such office or agency.

         SECTION 10.3.  Money for Security Payments to be Held in Trust.

         If the Corporation shall at any time act as its own Paying Agent with
respect to the Securities, it will, on or before each due date of the principal
of (and premium, if any, on) or interest on any of the Securities, segregate and
hold in trust for the benefit of the Persons entitled thereto a sum sufficient
to pay the principal (and premium, if any) or interest so becoming due until
such sums shall be paid to such Persons or otherwise disposed of as herein
provided, and will promptly notify the Trustee of its failure so to act.

         Whenever the Corporation shall have one or more Paying Agents, it will,
prior to 10:00 a.m., New York City time, on each due date of the principal of
(or premium, if any) or interest (including any Additional Interest) on any
Securities, deposit with a Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest (including any Additional Interest) so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal (and premium, if any) or interest (including any
Additional Interest), and (unless such Paying Agent is the Trustee) the
Corporation will promptly notify the Trustee of its failure so to act.

         The Corporation will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:

             (1)        hold all sums held by it for the payment of the
         principal of (and premium, if any) or interest (including any
         Additional Interest) on the Securities in trust for the benefit of the
         Persons entitled thereto until such sums shall be paid to such Persons
         or otherwise disposed of as herein provided;

             (2)        give the Trustee notice of any default by the
         Corporation (or any other obligor upon such Securities) in the making
         of any payment of principal (and premium, if any) or interest
         (including any Additional Interest);

             (3)        at any time during the continuance of any default with
         respect to the Securities, upon the written request of the Trustee,
         forthwith pay to the Trustee all sums so held in trust by such Paying
         Agent; and

             (4)        comply with the provisions of the Trust Indenture Act
         applicable to it as a Paying Agent.

         The Corporation may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Corporation Order direct any Paying Agent to pay, to the Trustee all sums
held in trust by the Corporation or such Paying Agent, such sums to be held by
the Trustee upon the same trusts as those upon which such sums were held by the
Corporation or such Paying




                                      -55-




Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying
Agent shall be released from all further liability with respect to such money.

         Any money deposited with the Trustee or any Paying Agent, or then held
by the Corporation in trust for the payment of the principal of (and premium, if
any) or interest (including any Additional Interest) on any Security and
remaining unclaimed for two years after such principal (and premium, if any) or
interest has become due and payable shall (unless otherwise required by
mandatory provision of applicable escheat or abandoned or unclaimed property
law) be paid on Corporation Request to the Corporation, or (if then held by the
Corporation) shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) be discharged from
such trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Corporation for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Corporation as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Corporation cause to be
published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Corporation.

         SECTION 10.4.  Statement as to Compliance.

         Each of the Corporation and the Guarantor shall deliver to the Trustee,
within 120 days after the end of each fiscal year of the Corporation or the
Guarantor, respectively, ending after the date hereof, an Officers' Certificate
covering the preceding calendar year, stating whether or not to the best
knowledge of the signers thereof the Corporation or the Guarantor, respectively,
is in default in the performance, observance or fulfillment of or compliance
with any of the terms, provisions, covenants and conditions of this Indenture,
and if the Corporation or the Guarantor, respectively, shall be in default,
specifying all such defaults and the nature and status thereof of which they may
have knowledge. For the purpose of this Section 10.4, compliance shall be
determined without regard to any grace period or requirement of notice provided
pursuant to the terms of this Indenture.

         SECTION 10.5.  Waiver of Certain Covenants.

         Subject to the rights of holders of Capital Securities specified in
Section 9.2, if any, the Corporation or the Guarantor, as the case may be, may
omit in any particular instance to comply with any covenant or condition
provided pursuant to Section 9.1(3) with respect to the Securities, if before or
after the time for such compliance the Holders of at least a majority in
aggregate principal amount of the Outstanding Securities shall, by Act of such
Holders, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the
Corporation or the Guarantor, as the case may be, in respect of any such
covenant or condition shall remain in full force and effect.

         SECTION 10.6.  Additional Sums.

         If, at any time while the Issuer Trust is the Holder of the Securities,
the Issuer Trust is required to pay any Additional Taxes, the Corporation shall
pay any and all additional amounts ("Additional Sums") that are required so that
the amounts then due and payable by the Issuer Trust on the Capital Securities


                                      -56-




and Common Securities that at any time remain outstanding in accordance with the
terms thereof shall not be reduced as a result of such Additional Taxes.
Whenever in this Indenture, the Securities or the Guarantees there is a
reference in any context to the payment of principal of or interest on the
Securities, such mention shall be deemed to include mention of the payments of
the Additional Sums provided for in this paragraph to the extent that, in such
context, Additional Sums are, were or would be payable in respect thereof
pursuant to the provisions of this paragraph and express mention of the payment
of Additional Sums (if applicable) in any provisions hereof shall not be
construed as excluding Additional Sums in those provisions hereof where such
express mention is not made; provided, however, that the deferral of the payment
of interest pursuant to Section 3.12 or the Securities shall not defer the
payment of any Additional Sums that may be due and payable.

         SECTION 10.7.  Additional Covenants.

         Each of the Corporation and the Guarantor covenants and agrees with
each Holder of Securities that it shall not, and shall not permit any of its
subsidiaries, (x) declare or pay any dividends or distributions on, or redeem
purchase, acquire or make a liquidation payment with respect to, any shares of
the Corporation's or the Guarantor's capital stock, or (y) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Corporation or the Guarantor (including other
Securities) that rank pari passu in all respects with or junior in interest to
the Securities or the Guarantees, respectively, or (z) make any guarantee
payments with respect to any guarantee by the Corporation or the Guarantor of
the debt securities of any Subsidiary of the Corporation or the Guarantor if
such guarantee ranks pari passu with or junior in interest to the Securities or
the Guarantees (other than (a) repurchases, redemptions or other acquisitions of
shares of capital stock of the Corporation or the Guarantor in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors, consultants or
independent contractors, in connection with a dividend reinvestment or
stockholder stock purchase plan or in connection with the issuance of capital
stock of the Corporation or the Guarantor (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of an exchange or conversion of any class or series of the Corporation's
or the Guarantor's capital stock (or any capital stock of a Subsidiary of the
Corporation or the Guarantor) for any class or series of the Corporation's or
the Guarantor's capital stock, respectively, or of any class or series of the
Corporation's or the Guarantor's indebtedness for any class or series of the
Corporation's or the Guarantor's capital stock, respectively, (c) the purchase
of fractional interests in shares of the Corporation's or the Guarantor's
capital stock, respectively, 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 Rights Plan, or the issuance of
rights, stock or other property under any 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) if at such time (i) there shall have occurred any event (A) of which
the Corporation or the Guarantor has actual knowledge that would constitute a
Debenture Default with respect to the Securities, and (B) which the Corporation
and the Guarantor shall not have taken reasonable steps to cure, (ii) if the
Securities are held by the Issuer Trust, the Corporation or the Guarantor shall
be in default with respect to its payment of any obligations under the Guarantee
Agreement relating to the Capital Securities, or the Guarantor shall be in
default with respect to its payment of any obligations under the Guarantees or
(iii) the Corporation shall have given notice of its election to begin an
Extension Period with respect to the Securities as provided herein and shall not
have rescinded such notice, or such Extension Period, or any extension thereof,
shall be continuing.




                                      -57-




         The Corporation also covenants with each Holder of Securities issued to
the Issuer Trust (i) to hold, directly or indirectly, 100% of the Common
Securities, provided that any permitted successor of the Corporation hereunder
may succeed to the Corporation's ownership of the Common Securities, (ii) as
holder of the Common Securities, not to voluntarily terminate, wind-up or
liquidate the Issuer Trust, other than (a) in connection with a distribution of
the Securities to the holders of the Capital Securities in liquidation of the
Issuer Trust, or (b) in connection with certain mergers, consolidations or
amalgamations permitted by the Trust Agreement, and (iii) to use its reasonable
efforts, consistent with the terms and provisions of the Trust Agreement, to
cause the Issuer Trust to be characterized as a grantor trust for United States
Federal income tax purposes and to not be required to register as an "investment
company" under the Investment Company Act.

                                   ARTICLE XI

                            REDEMPTION OF SECURITIES

         SECTION 11.1.  Applicability of This Article.

         Redemption of Securities as permitted or required by the form of
Security issued pursuant to this Indenture shall be made in accordance with the
form of Security and this Article; provided, however, that if any provision of
the form of Security shall conflict with any provision of this Article, the
provision of the form of Security shall govern. Each Security shall be subject
to partial redemption only in the amount of $1,000 or any integral multiples
thereof.

         SECTION 11.2.  Election to Redeem; Notice to Trustee.

         The election of the Corporation to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at the
election of the Corporation of less than all Securities, the Corporation shall,
not less than 30 nor more than 60 days prior to the Redemption Date (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
date and of the principal amount of Securities to be redeemed and provide the
additional information required to be included in the notice or notices
contemplated by Section 11.4; provided that in the case of any Securities held
by the Issuer Trust, such notice shall be given to the Property Trustee under
the Trust Agreement, not less than 45 nor more than 75 days prior to such
Redemption Date (unless a shorter notice shall be satisfactory to the Property
Trustee under the Trust Agreement). In the case of any redemption of Securities
prior to the expiration of any restriction on such redemption provided in the
terms of such Securities, the Corporation shall furnish the Trustee with an
Officers' Certificate and an Opinion of Counsel evidencing compliance with such
restriction.

         SECTION 11.3.  Selection of Securities to be Redeemed.

         If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities not previously
called for redemption, by such method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of a portion
of the principal amount of any Security, provided that the unredeemed portion of
the principal amount of any Security shall be in an authorized denomination
(which shall not be less than the minimum authorized denomination) for such
Security.



                                      -58-




         The Trustee shall promptly notify the Corporation in writing of the
Securities selected for partial redemption and the principal amount thereof to
be redeemed. For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security that has been or is to be
redeemed.

         SECTION 11.4.  Notice of Redemption.

         Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not later than the thirtieth day, and not earlier than the
sixtieth day, prior to the Redemption Date, to each Holder of Securities to be
redeemed, at the address of such Holder as it appears in the Securities
Register, provided that in the case of any Securities held by the Issuer Trust,
such notice shall be given not less than 45 nor more than 75 days prior to such
Redemption Date (unless a shorter notice shall be satisfactory to the Property
Trustee under the Trust Agreement).

         With respect to Securities to be redeemed, each notice of redemption
shall state:

         (a)    the Redemption Date;

         (b)    the Redemption Price or, if the Redemption Price cannot be
calculated prior to the time the notice is required to be sent, the estimate of
the Redemption Price together with a statement that it is an estimate and that
the actual Redemption Price will be calculated on the third Business Day prior
to the Redemption Date (and if an estimate is provided, a further notice shall
be sent of the actual Redemption Price on the date that such Redemption Price is
calculated);

         (c)    if less than all Outstanding Securities are to be redeemed, the
identification (and, in the case of partial redemption, the respective principal
amounts) of the particular Securities to be redeemed;

         (d)    that on the Redemption Date, the Redemption Price will become
due and payable upon each such Security or portion thereof, and that interest
(including any Additional Interest) thereon, if any, shall cease to accrue on
and after said date; and

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

         Notice of redemption of Securities to be redeemed at the election of
the Corporation shall be given by the Corporation or, at the Corporation's
request, by the Trustee in the name and at the expense of the Corporation and
shall be irrevocable. The notice if mailed in the manner provided above shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, a failure to give such notice by mail or any
defect in the notice to the Holder of any Security designated for redemption as
a whole or in part shall not affect the validity of the proceedings for the
redemption of any other Security.

         SECTION 11.5.  Deposit of Redemption Price.

         Prior to 10:00 a.m., New York City time, on the Redemption Date
specified in the notice of redemption given as provided in Section 11.4, the
Corporation will deposit with the Trustee or with one or more Paying Agents (or
if the Corporation is acting as its own Paying Agent, the Corporation will
segregate and hold in trust as provided in Section 10.3) an amount of money
sufficient to pay the




                                      -59-




Redemption Price of, and any accrued interest (including any Additional
Interest) on, all the Securities (or portions thereof) that are to be redeemed
on that date.

         SECTION 11.6.  Payment of Securities Called for Redemption.

         If any notice of redemption has been given as provided in Section 11.4,
the Securities or portion of Securities with respect to which such notice has
been given shall become due and payable on the date and at the place or places
stated in such notice at the applicable Redemption Price, together with accrued
interest (including any Additional Interest) to the Redemption Date. On
presentation and surrender of such Securities at a Place of Payment in said
notice specified, the said Securities or the specified portions thereof shall be
paid and redeemed by the Corporation at the applicable Redemption Price,
together with accrued interest (including any Additional Interest) to the
Redemption Date; provided, however, that, installments of interest (including
any Additional Interest) whose Stated Maturity is on or prior to the Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such at the close of business on the
relevant record dates according to their terms and the provisions of Section
3.8.

         Upon presentation of any Security redeemed in part only, the
Corporation shall execute and the Trustee shall authenticate and deliver to the
Holder thereof, at the expense of the Corporation, a new Security or Securities,
of authorized denominations, in aggregate principal amount equal to the
unredeemed portion of the Security so presented and having the same Original
Issue Date, Stated Maturity and terms.

         If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal of and premium, if any, on such
Security shall, until paid, bear interest from the Redemption Date at the rate
prescribed therefor in the Security.

         SECTION 11.7.  Right of Redemption of Securities Initially Issued to an
Issuer Trust.

         The Corporation may, at its option, subject to the Corporation having
received prior approval of the Federal Reserve if then required under applicable
capital guidelines or policies, redeem the Securities in whole at any time or in
part from time to time, at a Redemption Price equal to the greater of (i) 100%
of the principal amount of the Security being redeemed or (ii) as determined by
a Quotation Agent (as defined below), the sum of the present values of scheduled
payments of principal and interest for the Remaining Life (as defined below) of
the Securities being redeemed, discounted to the Redemption Date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate plus ____% (as defined below), plus, in the case of either
(i) or (ii), accrued and unpaid interest thereon to the Redemption Date.

         "Remaining Life" means, with respect to an optional redemption of the
Securities, the period from the Redemption Date through ____, 20___.

         "Treasury Rate" means (i) the yield, under the heading which represents
the average for the immediately prior week, appearing in the most recently
published statistical release designated "H.15(519)" or any successor
publication which is published weekly by the Board of Governors of the Federal
Reserve System and which establishes yields on actively traded United States
Treasury securities adjusted to constant maturity under the caption "Treasury
Constant Maturities," for the maturity corresponding to the Remaining Life (if
no maturity is within three months before or after the Remaining Life, yields
for the two published maturities most closely corresponding to the Remaining
Life shall be determined





                                      -60-




and the Treasury Rate shall be interpolated or extrapolated from such yields on
a straight-line basis, rounding to the nearest month) or (ii) if such release
(or any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
calculated using a price of the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date, The Treasury Rate shall be calculated on the third
Business Day preceding the Redemption Date.

         "Comparable Treasury Issue" means, with respect to any Redemption Date,
the United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Remaining Life that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the Remaining
Life. If no United States Treasury security has a maturity which is within a
period from three months before to three months after __________, 20___, the two
most closely corresponding United States Treasury securities shall be used as
the Comparable Treasury Issue, and the Treasury Rate shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest month using such
securities.

         "Quotation Agent" means each of [to come] and their respective
successors; provided, however, that if the foregoing shall cease to be a primary
U.S. Government securities dealer in New York City (a "Primary Treasury
Dealer"), the Corporation shall substitute therefor another Primary Treasury
Dealer. "Reference Treasury Dealer" means (i) the Quotation Agent and (ii) any
other Primary Treasury Dealer selected by the Trustee after consultation with
the Corporation.

         "Comparable Treasury Price" means (A) if the Trustee obtains five
Reference Treasury Dealer Quotations, the average of three Reference Treasury
Dealer Quotations for such Redemption Date, after excluding the highest and
lowest Reference Treasury Dealer Quotations obtained, or (B) if the Trustee
obtains fewer than five Reference Treasury Dealer Quotations, the average of all
such Reference Treasury Dealer Quotations.

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

         In addition, upon the occurrence and during the continuation of a Tax
Event, Capital Treatment Event or Investment Company Event in respect of the
Issuer Trust, the Corporation may, at its option, subject to its having received
prior approval of the Federal Reserve if then required under applicable capital
guidelines or policies, at any time within 90 days following the occurrence and
during the continuation of such Tax Event, Capital Treatment Event or Investment
Company Event, as the case may be, redeem this Security, in whole but not in
part, subject to the terms and conditions of Article XI of the Indenture, at a
redemption price equal to 100% of the principal amount, plus accrued and unpaid
interest thereon to the date of redemption.

         If less than all the Securities are to be redeemed, the aggregate
principal amount of such Securities remaining Outstanding after giving effect to
such redemption shall be sufficient to satisfy any provisions of the Trust
Agreement, including any requirement in the Trust Agreement as to the minimum
Liquidation Amount of Capital Securities that may be held by a holder of Capital
Securities thereunder.



                                      -61-




                                  ARTICLE XII

                           SUBORDINATION OF SECURITIES

         SECTION 12.1.  Securities Subordinate to Senior Debt.

         Each of the Corporation and the Guarantor covenants and agrees, and
each Holder of a Security, by its acceptance thereof, likewise covenants and
agrees, that, to the extent and in the manner hereinafter set forth in this
Article, the payment of the principal of (and premium, if any) and interest
(including any Additional Interest) on each and all of the Securities and
payments under the Guarantees are hereby expressly made subordinate and subject
in right of payment to the prior payment in full of all Senior Debt of the
Corporation and the Guarantor, respectively.

         SECTION 12.2.  No Payment When Senior Debt in Default; Payment Over of
Proceeds Upon Dissolution, Etc.

         If the Corporation or the Guarantor shall default in the payment of any
principal of (or premium, if any) or interest on any of its respective Senior
Debt when the same becomes due and payable, whether at maturity or at a date
fixed for prepayment or by declaration of acceleration or otherwise (whether or
not acceleration is declared), or if any judicial proceeding with respect to any
such payment default is continuing, then unless and until such default shall
have been cured or waived or shall have ceased to exist, no direct or indirect
payment (in cash, property, securities, by set-off or otherwise) shall be made
or agreed to be made on account of the principal of (or premium, if any) or
interest (including any Additional Interest) on any of the Securities or the
Guarantees, respectively, or in respect of any redemption, repayment,
retirement, purchase or other acquisition of any of the Securities.

         In the event of (a) any insolvency, bankruptcy, receivership,
liquidation, reorganization, readjustment, composition or other similar
proceedings relating to either of the Corporation or the Guarantor, its
creditors or its property, (b) any proceeding for the liquidation, dissolution
or other winding up of the Corporation or the Guarantor, voluntary or
involuntary, whether or not involving insolvency or bankruptcy proceedings, (c)
any assignment by the Corporation or the Guarantor for the benefit of creditors
or (d) any other marshalling of the assets of the Corporation or the Guarantor
(each such event, if any, herein sometimes referred to as a "Proceeding"), all
Senior Debt of the Corporation or the Guarantor, as the case may be (including
any interest thereon accruing after the commencement of any such proceedings),
shall first be paid in full before any payment or distribution, whether in cash,
securities or other property, shall be made to any Holder of any of the
Securities on account thereof. Any payment or distribution, whether in cash,
securities or other property (other than securities of the Corporation or the
Guarantor or any other corporation provided for by a plan of reorganization or
readjustment the payment of which is subordinate, at least to the extent
provided in these subordination provisions with respect to the indebtedness
evidenced by the Securities and the Guarantees, as the case may be, to the
payment of all Senior Debt of the Corporation or the Guarantor, respectively, at
the time outstanding and to any securities issued in respect thereof under any
such plan of reorganization or readjustment), which would otherwise (but for
these subordination provisions) be payable or deliverable in respect of the
Securities or the Guarantees thereon, as the case may be, shall be paid or
delivered directly to the holders of Senior Debt of the Corporation or the
Guarantor, respectively, in accordance with the priorities then existing among
such holders until all such Senior Debt (including any interest thereon accruing
after the commencement of any Proceeding) shall have been paid in full.



                                      -62-




         In the event of any Proceeding, after payment in full of all sums owing
with respect to the Corporation's or the Guarantor's Senior Debt, as the case
may be, the Holders of Securities, together with the holders of any obligations
of the Corporation or the Guarantor, as the case may be, ranking on a parity
with the Securities or the Guarantees, respectively (which for this purpose only
shall include the Allocable Amounts of Senior Subordinated Indebtedness), shall
be entitled to be paid from the remaining assets of the Corporation or the
Guarantor, as the case may be, the amounts at the time due and owing on account
of unpaid principal of (and premium, if any) and interest on the Securities or
the Guarantees, as the case may be, and such other obligations before any
payment or other distribution, whether in cash, property or otherwise, shall be
made on account of any capital stock or any obligations of the Corporation or
the Guarantor, respectively, ranking junior to the Securities or the Guarantees,
as the case may be, and such other obligations. If, notwithstanding the
foregoing, any payment or distribution of any character or any security, whether
in cash, securities or other property (other than securities of the Corporation
or the Guarantor or any other corporation provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Securities and the Guarantees, as the case may be,
to the payment of all Senior Debt of the Corporation or the Guarantor,
respectively, at the time outstanding and to any securities issued in respect
thereof under any such plan of reorganization or readjustment), shall be
received by the Trustee or any Holder in contravention of any of the terms
hereof and before all Senior Debt of the Corporation or the Guarantor, as the
case may be, shall have been paid in full, such payment or distribution or
security shall be received in trust for the benefit of, and shall be paid over
or delivered and transferred to, the holders of the Senior Debt of the
Corporation or the Guarantor, as the case may be, at the time outstanding in
accordance with the priorities then existing among such holders for application
to the payment of all Senior Debt of the Corporation or the Guarantor, as the
case may be, remaining unpaid, to the extent necessary to pay all such Senior
Debt of the Corporation or the Guarantor, as the case may be, in full. In the
event of the failure of the Trustee or any Holder to endorse or assign any such
payment, distribution or security, each holder of Senior Debt of the Corporation
or the Guarantor, as the case may be, is hereby irrevocably authorized to
endorse or assign the same.

         The Trustee and the Holders shall take such action (including, without
limitation, the delivery of this Indenture to an agent for the holders of Senior
Debt of the Corporation or the Guarantor, as the case may be, or consent to the
filing of a financing statement with respect hereto) as may, in the opinion of
counsel designated by the holders of a majority in principal amount of the
Senior Debt of the Corporation or the Guarantor, as the case may be, at the time
outstanding, be necessary or appropriate to assure the effectiveness of the
subordination effected by these provisions.

         The provisions of this Section 12.2 shall not impair any rights,
interests, remedies or powers of any secured creditor of the Corporation or the
Guarantor in respect of any security interest the creation of which is not
prohibited by the provisions of this Indenture.

         The securing of any obligations of the Corporation or the Guarantor, as
the case may be, otherwise ranking on a parity with the Securities or
Guarantees, respectively, or ranking junior to the Securities or Guarantees,
respectively, shall not be deemed to prevent such obligations from constituting,
respectively, obligations ranking on a parity with the Securities or Guarantees,
as the case may be, or ranking junior to the Securities or the Guarantees, as
the case may be.

         SECTION 12.3.  Payment Permitted If No Default.

         Nothing contained in this Article or elsewhere in this Indenture or in
any of the Securities or Guarantees shall prevent (a) the Corporation or the
Guarantor, at any time, except during the pendency of




                                      -63-




the conditions described in the first paragraph of Section 12.2 or of any
Proceeding referred to in Section 12.2, from making payments at any time of
principal of (and premium, if any) or interest (including any Additional
Interest) on the Securities or the Guarantees, respectively, or (b) the
application by the Trustee of any moneys deposited with it hereunder to the
payment of or on account of the principal of (and premium, if any) or interest
(including any Additional Interest) on the Securities or the Guarantees, as the
case may be, or the retention of such payment by the Holders, if, at the time of
such application by the Trustee, it did not have knowledge that such payment
would have been prohibited by the provisions of this Article.

         SECTION 12.4.  Subrogation to Rights of Holders of Senior Debt.

         Subject to the payment in full of all amounts due or to become due on
all Senior Debt of the Corporation or the Guarantor, as the case may be, or the
provision for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Debt of the Corporation or the Guarantor,
as the case may be, the Holders of Securities shall be subrogated to the extent
of the payments or distributions made to the holders of such Senior Debt
pursuant to the provisions of this Article (equally and ratably with the holders
of all indebtedness of the Corporation or the Guarantor, as the case may be,
that by its express terms is subordinated to Senior Debt of the Corporation or
the Guarantor, as the case may be, to substantially the same extent as the
Securities and the Guarantees, respectively, are subordinated to the Senior Debt
of the Corporation or the Guarantor, as the case may be, and is entitled to like
rights of subrogation by reason of any payments or distributions made to holders
of such Senior Debt) to the rights of the holders of such Senior Debt to receive
payments and distributions of cash, property and securities applicable to the
Senior Debt of the Corporation or the Guarantor, as the case may be, until the
principal of (and premium, if any) and interest (including any Additional
Interest) on the Securities or the Guarantees, respectively, shall be paid in
full. For purposes of such subrogation, no payments or distributions to the
holders of the Senior Debt of the Corporation or the Guarantor, as the case may
be, of any cash, property or securities to which the Holders of Securities or
the Guarantees, as the case may be, or the Trustee would be entitled except for
the provisions of this Article, and no payments over pursuant to the provisions
of this Article to the holders of Senior Debt of the Corporation or the
Guarantor, as the case may be, by Holders of Securities, or the Trustee, shall,
as among the Corporation or the Guarantor, as the case may be, its creditors
other than holders of its Senior Debt, and the Holders of Securities, be deemed
to be a payment or distribution by the Corporation or the Guarantor, as the case
may be, to or on account of its Senior Debt.

         SECTION 12.5.  Provisions Solely to Define Relative Rights.

         The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of Securities on the one
hand and the holders of Senior Debt of the Corporation and the Guarantor,
respectively, on the other hand. Nothing contained in this Article or elsewhere
in this Indenture or in the Securities or Guarantees, as the case may be, is
intended to or shall (a) impair, as between the Corporation or the Guarantor, as
the case may be, and the Holders of Securities, the obligations of the
Corporation or the Guarantor, as the case may be, which are absolute and
unconditional, to pay to the Holders of Securities the principal of (and
premium, if any) and interest (including any Additional Interest) on the
Securities or the Guarantees, as the case may be, as and when the same shall
become due and payable in accordance with their terms; or (b) affect the
relative rights against the Corporation or the Guarantor, as the case may be, of
the Holders of Securities and creditors of the Corporation and the Guarantor,
respectively, other than their rights in relation to the holders of Senior Debt
of the Corporation or the Guarantor, as the case may be; or (c) prevent the
Trustee or the Holder of any Security (or to the extent expressly provided
herein, the holder of any Capital Security) from




                                      -64-




exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, including filing and voting claims in any Proceeding, subject to
the rights, if any, under this Article of the holders of Senior Debt of the
Corporation or the Guarantor, as the case may be, to receive cash, property and
securities otherwise payable or deliverable to the Trustee or such Holder.

         SECTION 12.6.  Trustee to Effectuate Subordination.

         Each Holder of a Security by his or her acceptance thereof authorizes
and directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination provided
in this Article and appoints the Trustee his or her attorney-in-fact for any and
all such purposes.

         SECTION 12.7.  No Waiver of Subordination Provisions.

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

         Without in any way limiting the generality of the immediately preceding
paragraph, the holders of the Corporation's or the Guarantor's Senior Debt, as
the case may be, may, at any time and from to time, without the consent of or
notice to the Trustee or the Holders of Securities, without incurring
responsibility to such Holders of Securities and without impairing or releasing
the subordination provided in this Article or the obligations hereunder of such
Holders of Securities to the holders of the Corporation's and the Guarantor's
Senior Debt, respectively, do any one or more of the following: (i) change the
manner, place or terms of payment or extend the time of payment of, or renew or
alter, Senior Debt of the Corporation or the Guarantor, as the case may be, or
otherwise amend or supplement in any manner such Senior Debt or any instrument
evidencing the same or any agreement under which such Senior Debt is
outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt of the Corporation or the
Guarantor, as the case may be; (iii) release any Person liable in any manner for
the collection of Senior Debt of the Corporation or the Guarantor, as the case
may be; and (iv) exercise or refrain from exercising any rights against the
Corporation, the Guarantor and any other Person.

         SECTION 12.8.  Notice to Trustee.

         The Corporation or the Guarantor, as the case may be, shall give prompt
written notice to the Trustee of any fact known to the Corporation or the
Guarantor, as the case may be, that would prohibit the making of any payment to
or by the Trustee in respect of the Securities and the Guarantees, respectively.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment to or by the Trustee in
respect of the Securities or the Guarantees, unless and until the Trustee shall
have received written notice thereof from the Corporation or the Guarantor, as
the case may be, or a holder of the Corporation's or the Guarantor's Senior
Debt, as the case may be, or from any trustee, agent or representative therefor;
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



                                      -65-




any monies may become payable for any purpose (including, the payment of the
principal of (and premium, if any, on) or interest (including any Additional
Interest) on any Security or any Guarantee), then, anything herein contained to
the contrary notwithstanding, the Trustee shall have full power and authority to
receive such monies and to apply the same to the purpose 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.

         Subject to the provisions of Section 6.1, the Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself or herself to be a holder of Senior Debt of the Corporation or the
Guarantor, as the case may be (or a trustee or attorney-in-fact therefor), to
establish that such notice has been given by a holder of Senior Debt of the
Corporation or the Guarantor, as the case may be (or a trustee or
attorney-in-fact therefor). 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 Senior Debt of the Corporation or the Guarantor, as the case may
be, to participate in any payment or distribution pursuant to this Article, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt of the Corporation
or the Guarantor, as the case may be, 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, 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 12.9.  Reliance on Judicial Order or Certificate of Liquidating
Agent.

         Upon any payment or distribution of assets of the Corporation or the
Guarantor referred to in this Article, the Trustee, subject to the provisions of
Section 6.1, and the Holders of Securities shall be entitled to rely upon any
order or decree entered by any court of competent jurisdiction in which such
Proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or to
the Holders of Securities for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of the Senior Debt
and other indebtedness of the Corporation or the Guarantor, as the case may be,
the amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article.

         SECTION 12.10.  Trustee Not Fiduciary for Holders of Senior Debt.

         The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of the Corporation's or the
Guarantor's Senior Debt and shall not be liable to any such holders if it shall
in good faith mistakenly pay over or distribute to Holders of Securities or
Guarantees, as the case may be, or to the Corporation or the Guarantor, as the
case may be, or to any other Person cash, property or securities to which any
holders of Corporation's or the Guarantor's Senior Debt, as the case may be,
shall be entitled by virtue of this Article or otherwise.

         SECTION 12.11. Rights of Trustee as Holder of Senior Debt; Preservation
of Trustee's Rights.

         The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Debt of the
Corporation or the Guarantor, as the case may be, that may at any time be held
by it, to the same extent as any other holder of Senior Debt of the Corporation
and the Guarantor, respectively, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.



                                      -66-




         SECTION 12.12.  Article Applicable to Paying Agents.

         If at any time any Paying Agent other than the Trustee shall have been
appointed by the Corporation and be then acting hereunder, the term "Trustee" as
used in this Article shall in such case (unless the context otherwise requires)
be construed as extending to and including such Paying Agent within its meaning
as fully for all intents and purposes as if such Paying Agent were named in this
Article in addition to or in place of the Trustee.

                                     * * * *



                                       67





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

         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.

                                        POPULAR NORTH AMERICA, INC.


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


                                        POPULAR, INC.


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

Attest:


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

                                        THE BANK OF NEW YORK MELLON
                                        as Trustee


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

Attest:



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


                                       68

EX-4.15

Exhibit 4.15

CERTIFICATE OF AMENDMENT

TO

CERTIFICATE OF TRUST

OF

POPULAR CAPITAL TRUST IV

THIS Certificate of Amendment to Certificate of Trust of Popular Capital Trust IV (the “Trust”), is being duly executed and filed by the undersigned trustee to amend the Certificate of Trust of the Trust, which was filed on September 5, 2003 (the “Certificate of Trust”), with the Secretary of State of the State of Delaware under the Delaware Statutory Trust Act (12 Del. C. § 3801, et seq.)(the “Act”).

1.        Name. The name of the statutory trust is Popular Capital Trust IV.

2.        Amendment to Certificate of Trust.    The Certificate of Trust is hereby amended by amending and restating Section 2 thereof in its entirety as follows:

“2.       The name and business address of the trustee of the Trust in the State of Delaware is BNY Mellon Trust of Delaware, 100 White Clay Center, Suite 102, Newark, Delaware 19711.”

3.        Effective Date.    This Certificate of Amendment shall be effective upon filing.

IN WITNESS WHEREOF, the undersigned trustee of the Trust has executed this Certificate of Amendment in accordance with Section 3811(a)(2) of the Act.

BNY MELLON TRUST OF DELAWARE, not in its individual capacity, but solely as trustee
By:	/s/ Vincent E. Sampson
	Name: Vincent E. Sampson
	Title: President

EX-4.20

Exhibit 4.20

EXECUTION COPY

DECLARATION OF TRUST

AND

TRUST AGREEMENT

This DECLARATION OF TRUST AND TRUST AGREEMENT, dated as of June 16, 2006 (this “Trust Agreement”), among (i) Popular North America, Inc., a Delaware corporation, as depositor (the “Depositor”); (ii) Popular Inc., a Puerto Rico corporation (the “Guarantor”); (iii) Chase Bank USA, National Association, a national banking association, as Delaware trustee (the “Delaware Trustee”); (iv) J. P. Morgan Trust Company, National Association, as Property Trustee; and (v) Jorge A. Junquera and Richard Barrios, each an individual, as trustees (each of such trustees in (iii), (iv), and (v) a “Trustee” and collectively, the “Trustees”). The Depositor, the Guarantor and the Trustees hereby agree as follows:

1. The trust created hereby (the “Trust”) shall be known as “Popular North America Capital Trust II” in which name the Trustees, or the Depositor to the extent provided herein, may engage in the transactions contemplated hereby, make and execute contracts, and sue and be sued. The Trust is hereby established by the Depositor and the Trustees for the purpose of (i) issuing preferred securities (“Preferred Securities”) representing undivided beneficial interests in the assets of the Trust in exchange for cash and investing the proceeds thereof in debentures of the Depositor, (ii) issuing and selling common securities (“Common Securities” and, together with the Preferred Securities, “Trust Securities”) representing undivided beneficial interests in the assets of the Trust to the Depositor in exchange for cash and investing the proceeds thereof in additional debentures of the Depositor and (iii) engaging in such other activities as are necessary, convenient or incidental thereto.

2. The Depositor hereby assigns, transfers, conveys and sets over to the Trustees the sum of Ten Dollars ($10.00). The Trustees hereby acknowledge receipt of such amount in trust from the Depositor, which amount shall constitute the initial trust estate. The Trustees hereby declare that they will hold the trust estate in trust for the Depositor. It is the intention of the parties hereto that the Trust created hereby constitute a statutory trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. § 3801, et seq. (the “Statutory Trust Act”), and that this document constitutes the governing instrument of the Trust. The Trustees are hereby authorized and directed to execute and file a certificate of trust in the form of Exhibit A attached hereto with the Delaware Secretary of State in accordance with the provisions of the Statutory Trust Act.

3. The Depositor, the Guarantor, and the Trustees will enter into an Amended and Restated Declaration of Trust and Trust Agreement (herein the “Amended and Restated Trust Agreement”), satisfactory to each such party and substantially in the form included as an exhibit to the 1933 Act Registration Statement (as defined below), to provide for the contemplated operation of the Trust created hereby and the issuance of the Trust Securities. Prior to the execution and delivery of such Amended and Restated Trust Agreement, the Trustees shall not have any duty or obligation hereunder or with respect to the trust estate, except as otherwise required by this Trust Agreement, applicable law or as the Depositor directs in order to obtain, prior to such execution and delivery, any licenses, consents or approvals required by applicable law or otherwise including, but not limited to, the filing of the certificate of trust in accordance with Section 2 hereof.

Page 1 of 6

EXECUTION COPY

4. The Depositor, the Guarantor and the Trustees hereby authorize and direct the Depositor, as the agent of the Trust, (i) to file with the Securities and Exchange Commission (the “Commission”) and execute, in each case on behalf of the Trust, (a) the Registration Statement on Form S-3 (the “1933 Act Registration Statement”) (including any post-effective amendments to the 1933 Act Registration Statement) relating to the registration under the Securities Act of 1933, as amended (the “1933 Act”), of the Preferred Securities of the Trust and certain other securities of the Depositor; (b) any preliminary prospectus or prospectus or supplement thereto relating to the Preferred Securities required to be filed pursuant to Rule 424 under the 1933 Act; and (c) to the extent deemed advisable by the Depositor, a Registration Statement on Form 8-A (the “1934 Act Registration Statement” (including all pre-effective and post-effective amendments thereto) relating to the registration of the Preferred Securities of the Trust under the Exchange Act of 1934, as amended; (ii) to the extent deemed advisable by the Depositor, to file with one or more national securities exchanges (each, an “Exchange”) or the National Association of Securities Dealers (“NASD”) and execute on behalf of the Trust a listing application or applications and all other applications, statements, certificates, agreements and other instruments as shall be necessary or desirable to cause the Preferred Securities to be listed on any such Exchange or the NASD’s Nasdaq National Market (“NASDAQ”); (iii) to file and execute on behalf of the Trust such applications, reports, surety bonds, irrevocable consents, appointments of attorney for service of process and other papers and documents as shall be necessary or desirable to register the Preferred Securities under the securities or blue sky laws of such jurisdictions as the Depositor, on behalf of the Trust, may deem necessary or desirable; and (iv) to execute on behalf of the Trust one or more underwriting agreements relating to the Preferred Securities, among the Trust, the Depositor and the underwriter(s) named therein, substantially in the form included as an exhibit to the 1933 Act Registration Statement. In the event that any filing referred to in clauses (i), (ii) and (iii) above is required by the rules and regulations of the Commission, any Exchange, NASD or state securities or blue sky laws to be executed on behalf of the Trust by one or more of the Trustees, each of the Trustees, in its or his capacity as a Trustee of the Trust is hereby authorized and, to the extent so required, directed to join in any such filing and to execute on behalf of the Trust any and all of the foregoing, it being understood that Chase Bank USA, National Association, in its capacity as a Trustee of the Trust, shall not be required to join in any such filing or execute on behalf of the Trust any such document unless required by the rules and regulations of the Commission, the Exchange or state securities or blue sky laws. In connection with the filings referred to above, the Depositor and Jorge A. Junquera and Richard Barrios, each as Trustees and not in their individual capacities, hereby constitute and appoint Richard L. Carrión, Jorge A. Junquera and Richard Barrios and each of them as its and their true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for the Depositor or such Trustee or in the Depositor’s or such Trustees’ name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to the 1933 Act Registration Statement and the 1934 Act Registration Statement and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Commission, any Exchange, the NASD and administrators of the State securities or blue sky laws, granting unto said attorneys-in-fact and agents full power and

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authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as the Depositor or such Trustee might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their respective substitute or substitutes, shall do or cause to be done by virtue hereof.

5. The number of Trustees initially shall be three (3) and thereafter the number of Trustees shall be such number as shall be fixed from time to time by a written instrument signed by the Depositor which may increase or decrease the number of Trustees; provided, however, that to the extent required by the Statutory Trust Act, one Trustee shall either be a natural person who is a resident of the State of Delaware or, if not a natural person, an entity which has its principal place of business in the State of Delaware and otherwise meets the requirements of applicable Delaware law. Subject to the foregoing, the Depositor is entitled to appoint or remove without cause any Trustee at any time. The Trustees may resign upon thirty (30) days’ prior notice to the Depositor.

6.(a) The Trustees and their officers, directors, agents and servants (collectively, the “Fiduciary Indemnified Persons”) shall not be liable, responsible or accountable in damages or otherwise to the Trust, the Depositor, the Trustees or any holder of the Trust Securities (the Trust, the Depositor and any holder of the Trust Securities being a “Covered Person”) for any loss, damage or claim incurred by reason of any act or omission performed or omitted by the Fiduciary Indemnified Persons in good faith on behalf of the Trust and in a manner the Fiduciary Indemnified Persons reasonably believed to be within the scope of authority conferred on the Fiduciary Indemnified Persons by this Trust Agreement or by law, except that the Fiduciary Indemnified Persons shall be liable for any such loss, damage or claim incurred by reason of the Fiduciary Indemnified Person’s gross negligence or willful misconduct with respect to such acts or omissions.

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

   (c) The Depositor agrees, to the fullest extent permitted by applicable law, (i) to indemnify and hold harmless each Fiduciary Indemnified Person from and against any loss, damage, liability, tax, penalty, expense or claim of any kind or nature whatsoever incurred by or asserted against the Fiduciary Indemnified Persons by reason of the creation, operation or termination of the Trust or the transactions contemplated by this Trust Agreement in a manner the Fiduciary Indemnified Persons reasonably believe to be within the authority conferred on the Fiduciary Indemnified Persons by this Trust Agreement or by law, except that no Fiduciary Indemnified Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by the Fiduciary Indemnified Persons by reason of gross negligence or willful

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misconduct with respect to such acts or omissions, and (ii) to advance expenses (including legal fees) incurred by a Fiduciary Indemnified Person in defending any claim, demand, action, suit or proceeding shall, from time to time, prior to the final disposition of such claim, demand, action, suit or proceeding, upon receipt by the Trust of an undertaking by or on behalf of such Fiduciary Indemnified Persons to repay such amount if it shall be determined that such Fiduciary Indemnified Person is not entitled to be indemnified as authorized in the preceding subsection.

   (d) The provisions of this Section shall survive the termination of this Trust Agreement or the earlier resignation or removal of the Fiduciary Indemnified Persons.

7. This Trust Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware (without regard to conflict of laws principles).

8. This Trust Agreement may be executed in one or more counterparts.

9. The Trust may dissolve without issuing any Trust Securities at the election of the Depositor. Upon dissolution, the Trustees shall file a certificate of cancellation in accordance with the Statutory Trust Act.

[SIGNATURE PAGE FOLLOWS]

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

POPULAR NORTH AMERICA, INC., as Depositor
By:	/s/ Jorge A. Junquera
Name:	Jorge A. Junquera
Title:	President

POPULAR, INC., as Guarantor
By:	/s/ Richard Barrios
Name:	Richard Barrios
Title:	Senior Vice President and Treasurer

CHASE BANK USA, NATIONAL ASSOCIATION, as Delaware Trustee
By:	/s/ John J. Cashin
Name:	John J. Cashin
Title:	Vice President

J. P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION, as Property Trustee
By:	/s/ George N. Reaves
Name:	George N. Reaves
Title:	Vice President

/s/ Jorge A. Junquera

Jorge A. Junquera, as Trustee

/s/ Richard Barrios

Richard Barrios, as Trustee

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EXECUTION COPY

EXHIBIT A

CERTIFICATE OF TRUST

OF

POPULAR NORTH AMERICA CAPITAL TRUST II

THIS Certificate of Trust of Popular North America Capital Trust II (the “Trust”) is being duly executed and filed on behalf of the Trust by the undersigned, as trustees, to form a statutory trust under the Delaware Statutory Trust Act (12 Del.C. § 3801 et seq.) (the “Act”).

1. Name. The name of the statutory trust formed hereby is Popular North America Capital Trust II.

2. Delaware Trustee. The name and business address of the trustee of the Trust in the State of Delaware are Chase Bank USA, National Association, c/o JP Morgan Chase, 500 Stanton Christiana Road, OPS4/3^rd Floor, Newark, Delaware 19713, Attention: Worldwide Securities Services.

3. Effective Date. This Certificate of Trust shall be effective upon filing with the Secretary of State.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of Trust in accordance with Section 3811(a)(1) of the Act.

CHASE BANK USA, NATIONAL

ASSOCIATION, as Delaware trustee

By:

Name:

Title:

J. P. MORGAN TRUST COMPANY,

NATIONAL ASSOCIATION, as Property

Trustee

By:

Name:

Title:

Jorge A. Junquera, as Trustee

Richard Barrios, as Trustee

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DECLARATION OF TRUST

AND

TRUST AGREEMENT

This DECLARATION OF TRUST AND TRUST AGREEMENT, dated as of June 16, 2006 (this “Trust Agreement”), among (i) Popular North America, Inc., a Delaware corporation, as depositor (the “Depositor”); (ii) Popular Inc., a Puerto Rico corporation (the “Guarantor”); (iii) Chase Bank USA, National Association, a national banking association, as Delaware trustee (the “Delaware Trustee”); (iv) J. P. Morgan Trust Company, National Association, as Property Trustee; and (v) Jorge A. Junquera and Richard Barrios, each an individual, as trustees (each of such trustees in (iii), (iv), and (v) a “Trustee” and collectively, the “Trustees”). The Depositor, the Guarantor, and the Trustees hereby agree as follows:

1. The trust created hereby (the “Trust”) shall be known as “Popular North America Capital Trust III” in which name the Trustees, or the Depositor to the extent provided herein, may engage in the transactions contemplated hereby, make and execute contracts, and sue and be sued. The Trust is hereby established by the Depositor and the Trustees for the purpose of (i) issuing preferred securities (“Preferred Securities”) representing undivided beneficial interests in the assets of the Trust in exchange for cash and investing the proceeds thereof in debentures of the Depositor, (ii) issuing and selling common securities (“Common Securities” and, together with the Preferred Securities, “Trust Securities”) representing undivided beneficial interests in the assets of the Trust to the Depositor in exchange for cash and investing the proceeds thereof in additional debentures of the Depositor and (iii) engaging in such other activities as are necessary, convenient or incidental thereto.

2. The Depositor hereby assigns, transfers, conveys and sets over to the Trustees the sum of Ten Dollars ($10.00). The Trustees hereby acknowledge receipt of such amount in trust from the Depositor, which amount shall constitute the initial trust estate. The Trustees hereby declare that they will hold the trust estate in trust for the Depositor. It is the intention of the parties hereto that the Trust created hereby constitute a statutory trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. § 3801, et seq. (the “Statutory Trust Act”), and that this document constitutes the governing instrument of the Trust. The Trustees are hereby authorized and directed to execute and file a certificate of trust in the form of Exhibit A attached hereto with the Delaware Secretary of State in accordance with the provisions of the Statutory Trust Act.

3. The Depositor, the Guarantor, and the Trustees will enter into an Amended and Restated Declaration of Trust and Trust Agreement (herein the “Amended and Restated Trust Agreement”), satisfactory to each such party and substantially in the form included as an exhibit to the 1933 Act Registration Statement (as defined below), to provide for the contemplated operation of the Trust created hereby and the issuance of the Trust Securities. Prior to the execution and delivery of such Amended and Restated Trust Agreement, the Trustees shall not have any duty or obligation hereunder or with respect to the trust estate, except as

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otherwise required by this Trust Agreement, applicable law or as the Depositor directs in order to obtain, prior to such execution and delivery, any licenses, consents or approvals required by applicable law or otherwise including, but not limited to, the filing of the certificate of trust in accordance with Section 2 hereof.

4. The Depositor, the Guarantor and the Trustees hereby authorize and direct the Depositor, as the agent of the Trust, (i) to file with the Securities and Exchange Commission (the “Commission”) and execute, in each case on behalf of the Trust, (a) the Registration Statement on Form S-3 (the “1933 Act Registration Statement”) (including any post-effective amendments to the 1933 Act Registration Statement) relating to the registration under the Securities Act of 1933, as amended (the “1933 Act”), of the Preferred Securities of the Trust and certain other securities of the Depositor; (b) any preliminary prospectus or prospectus or supplement thereto relating to the Preferred Securities required to be filed pursuant to Rule 424 under the 1933 Act; and (c) to the extent deemed advisable by the Depositor, a Registration Statement on Form 8-A (the “1934 Act Registration Statement” (including all pre-effective and post-effective amendments thereto) relating to the registration of the Preferred Securities of the Trust under the Exchange Act of 1934, as amended; (ii) to the extent deemed advisable by the Depositor, to file with one or more national securities exchanges (each, an “Exchange”) or the National Association of Securities Dealers (“NASD”) and execute on behalf of the Trust a listing application or applications and all other applications, statements, certificates, agreements and other instruments as shall be necessary or desirable to cause the Preferred Securities to be listed on any such Exchange or the NASD’s Nasdaq National Market (“NASDAQ”); (iii) to file and execute on behalf of the Trust such applications, reports, surety bonds, irrevocable consents, appointments of attorney for service of process and other papers and documents as shall be necessary or desirable to register the Preferred Securities under the securities or blue sky laws of such jurisdictions as the Depositor, on behalf of the Trust, may deem necessary or desirable; and (iv) to execute on behalf of the Trust one or more underwriting agreements relating to the Preferred Securities, among the Trust, the Depositor and the underwriter(s) named therein, substantially in the form included as an exhibit to the 1933 Act Registration Statement. In the event that any filing referred to in clauses (i), (ii) and (iii) above is required by the rules and regulations of the Commission, any Exchange, NASD or state securities or blue sky laws to be executed on behalf of the Trust by one or more of the Trustees, each of the Trustees, in its or his capacity as a Trustee of the Trust is hereby authorized and, to the extent so required, directed to join in any such filing and to execute on behalf of the Trust any and all of the foregoing, it being understood that Chase Bank USA, National Association, in its capacity as a Trustee of the Trust, shall not be required to join in any such filing or execute on behalf of the Trust any such document unless required by the rules and regulations of the Commission, the Exchange or state securities or blue sky laws. In connection with the filings referred to above, the Depositor and Jorge A. Junquera and Richard Barrios, each as Trustees and not in their individual capacities, hereby constitute and appoint Richard L. Carrión, Jorge A. Junquera and Richard Barrios and each of them as its and their true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for the Depositor or such Trustee or in the Depositor’s or such Trustees’ name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to the 1933 Act Registration Statement and the 1934 Act Registration Statement and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Commission, any Exchange, the NASD and administrators of the

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State securities or blue sky laws, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as the Depositor or such Trustee might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their respective substitute or substitutes, shall do or cause to be done by virtue hereof.

5. The number of Trustees initially shall be three (3) and thereafter the number of Trustees shall be such number as shall be fixed from time to time by a written instrument signed by the Depositor which may increase or decrease the number of Trustees; provided, however, that to the extent required by the Statutory Trust Act, one Trustee shall either be a natural person who is a resident of the State of Delaware or, if not a natural person, an entity which has its principal place of business in the State of Delaware and otherwise meets the requirements of applicable Delaware law. Subject to the foregoing, the Depositor is entitled to appoint or remove without cause any Trustee at any time. The Trustees may resign upon thirty (30) days’ prior notice to the Depositor.

6.(a) The Trustees and their officers, directors, agents and servants (collectively, the “Fiduciary Indemnified Persons”) shall not be liable, responsible or accountable in damages or otherwise to the Trust, the Depositor, the Trustees or any holder of the Trust Securities (the Trust, the Depositor and any holder of the Trust Securities being a “Covered Person”) for any loss, damage or claim incurred by reason of any act or omission performed or omitted by the Fiduciary Indemnified Persons in good faith on behalf of the Trust and in a manner the Fiduciary Indemnified Persons reasonably believed to be within the scope of authority conferred on the Fiduciary Indemnified Persons by this Trust Agreement or by law, except that the Fiduciary Indemnified Persons shall be liable for any such loss, damage or claim incurred by reason of the Fiduciary Indemnified Person’s gross negligence or willful misconduct with respect to such acts or omissions.

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

   (c) The Depositor agrees, to the fullest extent permitted by applicable law, (i) to indemnify and hold harmless each Fiduciary Indemnified Person from and against any loss, damage, liability, tax, penalty, expense or claim of any kind or nature whatsoever incurred by or asserted against the Fiduciary Indemnified Persons by reason of the creation, operation or termination of the Trust or the transactions contemplated by this Trust Agreement in a manner the Fiduciary Indemnified Persons reasonably believe to be within the authority conferred on the Fiduciary Indemnified Persons by this Trust Agreement or by law, except that no Fiduciary Indemnified Person shall be entitled to be indemnified in respect of any loss, damage or claim

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incurred by the Fiduciary Indemnified Persons by reason of gross negligence or willful misconduct with respect to such acts or omissions, and (ii) to advance expenses (including legal fees) incurred by a Fiduciary Indemnified Person in defending any claim, demand, action, suit or proceeding shall, from time to time, prior to the final disposition of such claim, demand, action, suit or proceeding, upon receipt by the Trust of an undertaking by or on behalf of such Fiduciary Indemnified Persons to repay such amount if it shall be determined that such Fiduciary Indemnified Person is not entitled to be indemnified as authorized in the preceding subsection.

   (d) The provisions of this Section shall survive the termination of this Trust Agreement or the earlier resignation or removal of the Fiduciary Indemnified Persons.

7. This Trust Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware (without regard to conflict of laws principles).

8. This Trust Agreement may be executed in one or more counterparts.

9. The Trust may dissolve without issuing any Trust Securities at the election of the Depositor. Upon dissolution, the Trustees shall file a certificate of cancellation in accordance with the Statutory Trust Act.

[SIGNATURE PAGE FOLLOWS]

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EXECUTION COPY

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

POPULAR NORTH AMERICA, INC., as Depositor
By:	/s/ Jorge A. Junquera
Name:	Jorge A. Junquera
Title:	President

POPULAR, INC., as Guarantor
By:	/s/ Richard Barrios
Name:	Richard Barrios
Title:	Senior Vice President and Treasurer

CHASE BANK USA, NATIONAL ASSOCIATION, as Delaware Trustee
By:	/s/ John J. Cashin
Name:	John J. Cashin
Title:	Vice President

J. P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION, as Property Trustee
By:	/s/ George N. Reaves
Name:	George N. Reaves
Title:	Vice President

/s/ Jorge A. Junquera

Jorge A. Junquera, as Trustee

/s/ Richard Barrios

Richard Barrios, as Trustee

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EXHIBIT A

CERTIFICATE OF TRUST

OF

POPULAR NORTH AMERICA CAPITAL TRUST III

THIS Certificate of Trust of Popular North America Capital Trust III (the “Trust”) is being duly executed and filed on behalf of the Trust by the undersigned, as trustees, to form a statutory trust under the Delaware Statutory Trust Act (12 Del.C. § 3801 et seq.) (the “Act”).

1. Name. The name of the statutory trust formed hereby is Popular North America Capital Trust III.

2. Delaware Trustee. The name and business address of the trustee of the Trust in the State of Delaware are Chase Bank USA, National Association, c/o JP Morgan Chase, 500 Stanton Christiana Road, OPS4/3^rd Floor, Newark, Delaware 19713, Attention: WorldwideSecurities Services.

3. Effective Date. This Certificate of Trust shall be effective upon filing with the Secretary of State.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of Trust in accordance with Section 3811(a)(1) of the Act.

CHASE BANK USA, NATIONAL

ASSOCIATION, as Delaware trustee

By:

Name:

Title:

J. P. MORGAN TRUST COMPANY,

NATIONAL ASSOCIATION, as Property

Trustee

By:

Name:

Title:

Jorge A. Junquera, as Trustee

Richard Barrios, as Trustee

Page 6 of 6

EX-4.21

                                                                    EXHIBIT 4.21

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


                      AMENDED AND RESTATED TRUST AGREEMENT

                                      AMONG


                          POPULAR NORTH AMERICA, INC.,
                                  as Depositor

                                 POPULAR, INC.,
                                  as Guarantor


                           THE BANK OF NEW YORK MELLON,
                               as Property Trustee

                           BNY MELLON TRUST OF DELAWARE,
                               as Delaware Trustee

                                       and

                    THE ADMINISTRATIVE TRUSTEES NAMED HEREIN

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

                         Dated as of __________ __, 20__

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

                      POPULAR NORTH AMERICA CAPITAL TRUST __



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





                      POPULAR NORTH AMERICA CAPITAL TRUST __

              Certain Sections of this Trust Agreement relating to
                         Sections 310 through 318 of the
                          Trust Indenture Act of 1939:



Trust Indenture                                                                      Trust Agreement
Act Section                                                                             Section
---------------                                                                      ---------------
                                                                               
(ss.) 310      (a)(1)...........................................................     8.7
               (a)(2)...........................................................     8.7
               (a)(3)...........................................................     8.9
               (a)(4)...........................................................     2.7(a)(ii)
               (b)..............................................................     8.8
(ss.) 311      (a)..............................................................     8.13
               (b)..............................................................     8.13
(ss.) 312      (a)..............................................................     5.8
               (b)..............................................................     5.8
               (c)..............................................................     5.8
(ss.) 313      (a)..............................................................     8.15(a)
               (a)(4)...........................................................     8.15(b)
               (b)..............................................................     8.15(b)
               (c)..............................................................     10.8
               (d)..............................................................     8.15(c)
(ss.) 314      (a)..............................................................     8.16
               (b)..............................................................     Not Applicable
               (c)(1)...........................................................     8.17
               (c)(2)...........................................................     8.17
               (c)(3)...........................................................     Not Applicable
               (d)..............................................................     Not Applicable
               (e)..............................................................     1.1, 8.17
(ss.) 315      (a)..............................................................     8.1, 8.3
               (b)..............................................................     8.2, 10.8
               (c)..............................................................     8.1(c)
               (d)..............................................................     8.1, 8.3
               (e)..............................................................     Not Applicable
(ss.) 316      (a)..............................................................     Not Applicable
               (a)(1)(A)........................................................     Not Applicable
               (a)(1)(B)........................................................     Not Applicable
               (a)(2)...........................................................     Not Applicable
               (b)..............................................................     5.15
               (c)..............................................................     6.7
(ss.) 317      (a)(1)...........................................................     Not Applicable
               (a)(2)...........................................................     Not Applicable
               (b)..............................................................     5.10
(ss.) 318      (a)..............................................................     10.10




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






                                TABLE OF CONTENTS


                                                                                                     
                                    ARTICLE I

                                  DEFINED TERMS


Section 1.1       Definitions............................................................................2


                                   ARTICLE II

                        CONTINUATION OF THE ISSUER TRUST

Section 2.1       Name..................................................................................11
Section 2.2       Office of the Delaware Trustee; Principal Place of Business...........................11
Section 2.3       Initial Contribution of Trust Property; Organizational Expenses.......................12
Section 2.4       Issuance of the Capital Securities....................................................12
Section 2.5       Issuance of the Common Securities; Subscription and Purchase of Debentures............12
Section 2.6       Continuation of Trust.................................................................12
Section 2.7       Authorization to Enter into Certain Transactions......................................13
Section 2.8       Assets of Trust.......................................................................16
Section 2.9       Title to Trust Property...............................................................16


                                   ARTICLE III

                                 PAYMENT ACCOUNT

Section 3.1       Payment Account.......................................................................17


                                   ARTICLE IV

                            DISTRIBUTIONS; REDEMPTION

Section 4.1       Distributions.........................................................................17
Section 4.2       Redemption............................................................................18
Section 4.3       Subordination of Common Securities....................................................20
Section 4.4       Payment Procedures....................................................................21
Section 4.5       Tax Returns and Reports...............................................................21
Section 4.6       Payment of Taxes, Duties, Etc. of the Issuer Trust....................................22
Section 4.7       Payments under Indenture or Pursuant to Direct Actions................................22



                                       -i-




                                                                                                     
                                    ARTICLE V

                          TRUST SECURITIES CERTIFICATES

Section 5.1       Initial Ownership.....................................................................22
Section 5.2       The Trust Securities Certificates.....................................................22
Section 5.3       Execution and Delivery of Trust Securities Certificates...............................23
Section 5.4       Book-Entry Capital Securities.........................................................23
Section 5.5       Registration of Transfer and Exchange of Capital Securities Certificates..............25
Section 5.6       Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates....................27
Section 5.7       Persons Deemed Holders................................................................27
Section 5.8       Access to List of Holders' Names and Addresses........................................27
Section 5.9       Maintenance of Office or Agency.......................................................28
Section 5.10      Appointment of Paying Agent...........................................................28
Section 5.11      Ownership of Common Securities by Depositor...........................................28
Section 5.12      Notices to Clearing Agency............................................................29
Section 5.13      Rights of Holders; Waivers of Past Defaults...........................................29


                                   ARTICLE VI

                        ACTS OF HOLDERS; MEETINGS; VOTING

Section 6.1       Limitations on Voting Rights..........................................................32
Section 6.2       Notice of Meetings....................................................................33
Section 6.3       Meetings of Holders of the Capital Securities.........................................33
Section 6.4       Voting Rights.........................................................................33
Section 6.5       Proxies, etc..........................................................................33
Section 6.6       Holder Action by Written Consent......................................................34
Section 6.7       Record Date for Voting and Other Purposes.............................................34
Section 6.8       Acts of Holders.......................................................................34
Section 6.9       Inspection of Records.................................................................35


                                   ARTICLE VII

                         REPRESENTATIONS AND WARRANTIES

Section 7.1       Representations and Warranties of the Property Trustee and the Delaware Trustee.......35
Section 7.2       Representations and Warranties of Depositor...........................................37





                                      -ii-





                                                                                                     
                                  ARTICLE VIII

                               THE ISSUER TRUSTEES

Section 8.1       Certain Duties and Responsibilities...................................................37
Section 8.2       Certain Notices.......................................................................40
Section 8.3       Certain Rights of Property Trustee....................................................40
Section 8.4       Not Responsible for Recitals or Issuance of Securities................................42
Section 8.5       May Hold Securities...................................................................42
Section 8.6       Compensation; Indemnity; Fees.........................................................42
Section 8.7       Corporate Property Trustee Required; Eligibility of Issuer Trustees...................43
Section 8.8       Conflicting Interests.................................................................44
Section 8.9       Co-Trustees and Separate Trustee......................................................44
Section 8.10      Resignation and Removal; Appointment of Successor.....................................45
Section 8.11      Acceptance of Appointment by Successor................................................47
Section 8.12      Merger, Conversion, Consolidation or Succession to Business...........................48
Section 8.13      Preferential Collection of Claims Against Depositor or Issuer Trust...................48
Section 8.14      Property Trustee May File Proofs of Claim.............................................48
Section 8.15      Reports by Property Trustee...........................................................49
Section 8.16      Reports to the Property Trustee.......................................................50
Section 8.17      Evidence of Compliance with Conditions Precedent......................................50
Section 8.18      Number of Issuer Trustees.............................................................50
Section 8.19      Delegation of Power...................................................................50
Section 8.20      Appointment of Administrative Trustees................................................51
Section 8.21      Outside Business......................................................................51


                                   ARTICLE IX

                       TERMINATION, LIQUIDATION AND MERGER

Section 9.1       Termination Upon Expiration Date......................................................52
Section 9.2       Early Termination.....................................................................52
Section 9.3       Termination...........................................................................52
Section 9.4       Liquidation...........................................................................53
Section 9.5       Mergers, Consolidations, Amalgamations or Replacements of Issuer Trust................54


                                    ARTICLE X

                            MISCELLANEOUS PROVISIONS

Section 10.1      Limitation of Rights of Holders.......................................................55




                                     -iii-




                                                                                                     
Section 10.2      Amendment.............................................................................56
Section 10.3      Separability..........................................................................57
Section 10.4      Governing Law.........................................................................57
Section 10.5      Payments Due on Non-Business Day......................................................57
Section 10.6      Successors............................................................................57
Section 10.7      Headings..............................................................................58
Section 10.8      Reports, Notices and Demands..........................................................58
Section 10.9      Agreement Not to Petition.............................................................58
Section 10.10     Trust Indenture Act; Conflict with Trust Indenture Act................................59
Section 10.11     Acceptance of Terms of Trust Agreement, Guarantee Agreement and Indenture.............59

Exhibit A         Certificate of Trust
Exhibit B         Form of Letter of Representations
Exhibit C         Form of Common Securities Certificate
Exhibit D         Form of Expense Agreement
Exhibit E         Form of Capital Securities Certificate



                                      -iv-





         AMENDED AND RESTATED TRUST AGREEMENT, dated as of _____, 20__, among
(i) Popular North America, Inc., a Delaware corporation (including any permitted
successors or assigns under the Indenture (as hereinafter defined), the
"Depositor"), (ii) Popular, Inc., a Puerto Rico corporation (including any
permitted successors or assigns under the Indenture, the "Guarantor"), (iii)
The Bank of New York Mellon, a national banking association, as property trustee
(in such capacity, the "Property Trustee", (iv) BNY Mellon Trust of Delaware, as
Delaware trustee (in such capacity, the "Delaware Trustee"), (v) Jorge A.
Junquera, an individual, and Richard Barrios, an individual, each of whose
address is c/o Popular North America, Inc., 209 Munoz Rivera Avenue, San Juan,
Puerto Rico 00918 (each an "Administrative Trustee" and collectively the
"Administrative Trustees") (the Property Trustee, the Delaware Trustee and the
Administrative Trustees being referred to collectively as the "Issuer
Trustees"), and (vi) the several Holders, as hereinafter defined.

                                   WITNESSETH

         WHEREAS, the Depositor, the Guarantor, the Delaware Trustee and the
Administrative Trustees have heretofore duly declared and established a
statutory trust pursuant to the Delaware Statutory Trust Act by entering into
the Trust Agreement, dated as of June 16, 2006 (the "Original Trust
Agreement"), and by the execution and filing by the Delaware Trustee and the
Administrative Trustees with the Secretary of State of the State of Delaware of
the Certificate of Trust, filed on June 16, 2006, attached as Exhibit A; and

         WHEREAS, the Depositor, the Guarantor, the Delaware Trustee and the
Administrative Trustees desire to amend and restate the Original Trust Agreement
in its entirety as set forth herein to provide for, among other things, (i) the
issuance of the Common Securities by the Issuer Trust to the Depositor, (ii) the
issuance and sale of the Capital Securities by the Issuer Trust pursuant to the
Purchase Agreement, (iii) the acquisition by the Issuer Trust from the Depositor
of all of the right, title and interest in the Debentures and (iv) the
appointment of the Issuer Trustees;

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





                                   ARTICLE I

                                  DEFINED TERMS

         SECTION 1.1 Definitions.

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

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

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

                  (c)      The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation";

                  (d)      All accounting terms used but not defined herein have
the meanings assigned to them in accordance with United States generally
accepted accounting principles;

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

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

                  "Act" has the meaning specified in Section 6.8.

                  "Additional Amount" means, with respect to Trust Securities of
a given Liquidation Amount and/or a given period, the amount of Additional
Interest (as defined in the Indenture) paid by the Depositor on a Like Amount of
Debentures for such period.

                  "Additional Sums" has the meaning specified in Section 10.6 of
the Indenture.

                  "Administrative Trustee" means each of the Persons appointed
in accordance with Section 8.20 solely in such Person's capacity as
Administrative Trustee of the Issuer Trust heretofore formed and continued
hereunder and not in such Person's individual capacity, or any successor
Administrative Trustee appointed as herein provided.

                  "Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such




Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

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

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

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

                           (a)      the entry of a decree or order by a court
         having jurisdiction in the premises judging such Person a bankrupt or
         insolvent, or approving as properly filed a petition seeking
         reorganization, arrangement, adjudication or composition of or in
         respect of such Person under any applicable bankruptcy, insolvency,
         reorganization or other similar law, or appointing a receiver,
         liquidator, assignee, trustee, sequestrator (or other similar official)
         of such Person or of any substantial part of its property or ordering
         the winding up or liquidation of its affairs, and the continuance of
         any such decree or order unstayed and in effect for a period of 60
         consecutive days; or

                           (b)      the institution by such Person of voluntary
         proceedings to be adjudicated a bankrupt or insolvent, or the consent
         by it to the institution of bankruptcy or insolvency proceedings
         against it, or the filing by it of a petition or answer or consent
         seeking reorganization or relief under any applicable bankruptcy,
         insolvency, reorganization or other similar law, or the consent by it
         to the filing of any such petition or to the appointment of a receiver,
         liquidator, assignee, trustee, sequestrator (or similar official) of
         such Person or of any substantial part of its property, or the making
         by it of an assignment for the benefit of creditors, or the admission
         by it in writing of its inability to pay its debts generally as they
         become due and its willingness to be adjudicated a bankrupt.

                  "Bankruptcy Laws" means any bankruptcy, insolvency,
reorganization or other similar law, including Title 11 of the United States
Code.

                  "Board of Directors" means the board of directors of the
Depositor or the Executive Committee of the board of directors of the Depositor
(or any other committee of the board of directors of the Depositor performing
similar functions) or a committee designated by the board of directors of the
Depositor (or any such committee), comprised of two or more members of the board
of directors of the Depositor or officers of the Depositor, or both.

                  "Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Depositor to have been duly
adopted by the Depositor's Board of Directors, or officers of the Depositor to
which authority to act on behalf of the Board

                                      -3-




of Directors has been delegated and to be in full force and effect on the date
of such certification, and delivered to the Issuer Trustees.

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

                  "Book-Entry Capital Security" means a Capital Security, the
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 5.4.

                  "Business Day" means a day other than a Saturday, a Sunday or
any other day on which banking institutions in New York, New York, San Juan,
Puerto Rico or Wilmington, Delaware are authorized or required by law,
regulation or executive order to remain closed or are customarily closed.

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

                  "Capital Security" means a preferred undivided beneficial
interest in assets of the Issuer Trust, having a Liquidation Amount of $1,000
and having the rights provided therefor in this Trust Agreement, including the
right to receive Distributions and a Liquidation Distribution to the extent
provided herein.

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

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

                  "Closing Date" means the Closing Time specified in the
Purchase Agreement, which date is also the date of execution and delivery of
this Trust Agreement.

                  "Code" means the Internal Revenue Code of 1986, as amended.

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

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

                  "Common Security" means a common undivided beneficial interest
in the assets of the Issuer Trust, having a Liquidation Amount of $1,000 and
having the rights provided therefor in this Trust Agreement, including the right
to receive Distributions and a Liquidation Distribution to the extent provided
herein.


                                      -4-




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

                  "Debenture Default" means any "Debenture Default" specified in
Section 5.2 of the Indenture.

                  "Debenture Event of Default" means any "Debenture Event of
Default" specified in Section 5.1 of the Indenture.

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

                  "Debenture Tax Event" means a "Tax Event" as defined in the
Indenture.

                  "Debenture Trustee" means the Person identified as the
"Trustee" in the Indenture, solely in its capacity as Trustee pursuant to the
Indenture and not in its individual capacity, or its successor in interest in
such capacity, or any successor Trustee appointed as provided in the Indenture.

                  "Debentures" means the Depositor's _____% Junior Subordinated
Debentures, issued pursuant to the Indenture.

                  "Definitive Capital Securities Certificates" means either or
both (as the context requires) of (i) Capital Securities Certificates issued as
Book-Entry Capital Securities Certificates as provided in Section 5.2 or 5.4,
and (ii) Capital Securities Certificates issued in certificated, fully
registered form as provided in Section 5.2, 5.4 or 5.5.

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

                  "Delaware Trustee" means the Person identified as the
"Delaware Trustee" in the preamble to this Trust Agreement, solely in its
capacity as Delaware Trustee of the trust heretofore formed and continued
hereunder and not in its individual capacity, or its successor in interest in
such capacity, or any successor Delaware Trustee appointed as herein provided.

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

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

                  "Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1, and includes any and all Additional
Amounts and Additional Sums.


                                      -5-




                  "DTC" means The Depository Trust Company.

                  "Early Termination Event" has the meaning specified in Section
9.2.

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

                  "Expense Agreement" means the Agreement as to Expenses and
Liabilities, dated as of the Closing Date, between the Depositor, in its
capacity as holder of the Common Securities, the Guarantor and the Issuer Trust,
substantially in the form attached as Exhibit D, as amended from time to time.

                  "Expiration Date" has the meaning specified in Section 9.1.

                  "Guarantee Agreement" means the Guarantee Agreement executed
and delivered by the Depositor, the Guarantor and The Bank of New York Mellon,
as guarantee trustee, contemporaneously with the execution and delivery of this
Trust Agreement, for the benefit of the Holders of the Capital Securities, as
amended from time to time.

                  "Guarantor" has the meaning specified in the preamble to this
Trust Agreement.

                  "Holder" means a Person in whose name a Trust Security or
Trust Securities is or are registered in the Securities Register; any such
Person shall be deemed to be a beneficial owner within the meaning of the
Delaware Statutory Trust Act.

                  "Indenture" means the Junior Subordinated Indenture, dated as
of the Closing Date, among the Depositor, the Guarantor and the Debenture
Trustee, as trustee, as amended or supplemented from time to time.

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

                  "Issuer Trust" means the Delaware statutory trust known as
"Popular North America Capital Trust __" which was formed on June 16,
2006 under the Delaware Statutory Trust Act pursuant to the Original Trust
Agreement and the filing of the Certificate of Trust, and continued pursuant to
this Trust Agreement.

                  "Issuer Trustees" has the meaning specified in the preamble to
this Trust Agreement.

                  "Letter of Representations" means the agreement among the
Issuer Trust, the Property Trustee and DTC, as the initial Clearing Agency,
dated as of the Closing Date, substantially in the form attached as Exhibit B,
as the same may be amended and supplemented from time to time.


                                      -6-





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

                  "Like Amount" means (a) with respect to a redemption of any
Trust Securities, Trust Securities having a Liquidation Amount equal to the
principal amount of Debentures that are contemporaneously maturing or being
redeemed in accordance with the Indenture, the proceeds of which will be used to
pay the Redemption Price of such Trust Securities and (b) with respect to a
distribution of Debentures to Holders of Trust Securities in connection with a
dissolution or liquidation of the Issuer Trust, Debentures having a principal
amount equal to the Liquidation Amount of the Trust Securities of the Holder to
whom such Debentures are distributed.

                  "Liquidation Amount" means the stated amount of $1,000 per
Trust Security.

                  "Liquidation Date" means the date of the dissolution,
winding-up or termination of the Issuer Trust pursuant to Section 9.4.

                  "Liquidation Distribution" has the meaning specified in
Section 9.4(d).

                  "Majority in Liquidation Amount of the Capital Securities" or
"Majority in Liquidation Amount of the Common Securities" means, except as
provided by the Trust Indenture Act, Capital Securities or Common Securities, as
the case may be, representing more than 50% of the aggregate Liquidation Amount
of all then Outstanding Capital Securities or Common Securities, as the case may
be.

                  "Officers' Certificate" means a certificate signed by the
Chairman of the Board, a Vice Chairman of the Board, the President or a Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Depositor, and delivered to the Issuer Trustees. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Trust Agreement shall include:

                           (a)      a statement by each officer signing the
         Officers' Certificate that such officer 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 Officers' 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.


                                      -7-





                  "Opinion of Counsel" means a written opinion of counsel, who
may be counsel for or an employee of the Depositor or any Affiliate of the
Depositor.

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

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

                           (a)      Trust Securities theretofore cancelled by
         the Property Trustee or delivered to the Property Trustee for
         cancellation;

                           (b)      Trust Securities for whose payment money in
         the necessary amount has been theretofore deposited with the Property
         Trustee or any Paying Agent in trust for the Holders of such Trust
         Securities; and

                           (c)      Trust Securities in substitution for or in
         lieu of which other Trust Securities have been authenticated and
         delivered or that have been paid pursuant to Section 3.7 of the
         Indenture, unless proof satisfactory to the Property Trustee is
         presented that any such Trust Securities are held by Holders in whose
         hands such Trust Securities are valid, binding and legal obligations of
         the Depositor;

provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Capital Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Capital
Securities owned by the Depositor or any other obligor upon the Trust Securities
or any Affiliate of the Depositor or such other obligor shall be disregarded and
deemed not to be Outstanding, except that in determining whether any Issuer
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Capital Securities
that such Issuer Trustee knows to be so owned shall be so disregarded. Capital
Securities so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Administrative
Trustees the pledgee's right so to act with respect to such Capital Securities
and that the pledgee is not the Depositor or any other obligor upon the Trust
Securities or any Affiliate of the Depositor or such other obligor. Upon the
written request of the Property Trustee, the Depositor shall furnish to the
Property Trustee promptly an Officers' Certificate listing and identifying all
Capital Securities, if any, known by the Depositor to be owned or held by or for
the account of the Depositor, or any other obligor on the Capital Securities or
any Affiliate of the Depositor or such obligor, and subject to the provisions of
Section 6.1 of the Indenture, the Property Trustee shall be entitled to accept
such Officers' Certificate as conclusive evidence of the facts therein set forth
and of the fact that all Capital Securities not listed therein are Outstanding
for the purpose of any such determination.

                  "Owner" means each Person who is the beneficial owner of
Book-Entry Capital Securities as reflected in the records of the Clearing Agency
or, if a Clearing Agency Participant is reflected in such records as the
beneficial owner but is not the actual

                                      -8-




beneficial owner, then as reflected in the records of a Person maintaining an
account with such Clearing Agency (directly or indirectly, in accordance with
the rules of such Clearing Agency).

                  "Paying Agent" means any paying agent or co-paying agent
appointed pursuant to Section 5.10 and shall initially be the Bank.

                  "Payment Account" means a segregated non-interest-bearing
corporate trust account maintained by the Property Trustee for the benefit of
the Holders in which all amounts paid in respect of the Debentures will be held
and from which the Property Trustee, through the Paying Agent, shall make
payments to the Holders in accordance with Sections 4.1 and 4.2.

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

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

                  "Purchase Agreement" means the Purchase Agreement, dated as
of _____, 20__, among the Issuer Trust, the Depositor and the Underwriters, as
named therein, as the same may be amended from time to time.

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

                  "Redemption Price" means, with respect to any Trust Security,
the Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, paid by the Depositor upon the concurrent redemption or maturity of a Like
Amount of Debentures.

                  "Relevant Trustee" has the meaning specified in Section 8.10.

                  "Responsible Officer", when used with respect to the Property
Trustee, means the chairman or any vice-chairman of the board of directors, the
chairman or any vice-chairman of the executive committee of the board of
directors, the chairman of the trust committee, the president, any vice
president, the secretary, any assistant secretary, the treasurer, any assistant
treasurer, the cashier, any assistant cashier, any trust officer or assistant
trust officer, the controller or any assistant controller or any other officer
of the Property Trustee customarily performing functions similar to those
performed by any of


                                      -9-




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 his knowledge of and familiarity with the particular subject.

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

                  "Securities Register" and "Securities Registrar" have the
respective meanings specified in Section 5.5.

                  "Successor Securities" has the meaning specified in Section
9.5.

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

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

                           (a)      the occurrence of a Debenture Default; or

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

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

                           (d)      default by the Issuer Trust in the payment
         of the Liquidation Distribution or Distribution of Issuer Trust
         property when the same becomes due and payable; or

                           (e)      default in the performance, or breach, in
         any material respect, of any covenant or warranty of the Issuer
         Trustees in this Trust Agreement (other than those specified in clause
         (b) or (c) above) and continuation of such default or breach for a
         period of 90 days after there has been given, by registered or
         certified mail, to the defaulting Issuer Trustees by the Holders of at
         least 25% in aggregate Liquidation Amount of the Outstanding Capital
         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

                                      -10-




                           (f)      the occurrence of a Bankruptcy Event with
         respect to the Property Trustee if a successor Property Trustee has not
         been appointed within 90 days thereof.

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

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

                  "Trust Security" means any one of the Common Securities or the
Capital Securities, as the case may be.

                  "Trust Securities Certificate" means any one of the Common
Securities Certificates or the Capital Securities Certificates, as the case may
be.

                  "Vice President," when used with respect to the Depositor,
means any duly appointed vice president, whether or not designated by a number
or a word or words added before or after the title "vice president."

                                   ARTICLE II

                        CONTINUATION OF THE ISSUER TRUST

         SECTION 2.1       Name.

                  The trust continued hereby shall be known as "Popular North
America Capital Trust __", as such name may be modified from time to time by the
Administrative Trustees following written notice to the Holders of Trust
Securities and the other Issuer Trustees, in which name the Issuer Trustees may
conduct the business of the Issuer Trust, make and execute contracts and other
instruments on behalf of the Issuer Trust and sue and be sued.

         SECTION 2.2       Office of the Delaware Trustee; Principal Place of
Business.

                  The address of the Delaware Trustee in the State of Delaware
is 500 Stanton Christiana Road, 3rd Floor/OPS4 Newark, New Castle County,
Delaware 19713, Attention: [John Cashin], or such other address in the State of
Delaware as the Delaware Trustee may designate by written notice to the Holders,
the Depositor, the Property Trustee and the Administrative Trustees. The
principal executive office of the Issuer Trust is c/o Popular North America,
Inc., 209 Munoz Rivera Avenue, San Juan, Puerto Rico 00918, Attention:
Secretary.


                                      -11-





         SECTION 2.3       Initial Contribution of Trust Property;
Organizational Expenses.

                  The Property Trustee acknowledges receipt in trust from the
Depositor in connection with the Original Trust Agreement of the sum of $10,
which constituted the initial Trust Property. The Depositor shall pay
organizational expenses of the Issuer Trust in accordance with the Expense
Agreement. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.

         SECTION 2.4       Issuance of the Capital Securities.

                  On _____, 20__, the Depositor, both on its own behalf and on
behalf of the Issuer Trust pursuant to the Original Trust Agreement, executed
and delivered the Purchase Agreement. Contemporaneously with the execution and
delivery of this Trust Agreement, an Administrative Trustee, on behalf of the
Issuer Trust, shall manually execute in accordance with Sections 5.2, 5.3 and
8.9(a) and the Property Trustee shall deliver to the Underwriters, Capital
Securities Certificates, registered in the names requested by the Underwriters,
evidencing an aggregate of _______ Capital Securities having an aggregate
Liquidation Amount of $___________, against receipt of the aggregate purchase
price of such Capital Securities of $___________ by the Property Trustee.

         SECTION 2.5       Issuance of the Common Securities; Subscription and
Purchase of Debentures.

                  Contemporaneously with the execution and delivery of this
Trust Agreement, an Administrative Trustee, on behalf of the Issuer Trust, shall
execute in accordance with Sections 5.2, 5.3 and 8.9(a) and the Property Trustee
shall deliver to the Depositor, Common Securities Certificates, registered in
the name of the Depositor, evidencing an aggregate of ______ Common Securities
having an aggregate Liquidation Amount of $___________, against receipt of the
aggregate purchase price of such Common Securities of $___________ by the
Property Trustee. Contemporaneously therewith, an Administrative Trustee, on
behalf of the Issuer Trust, shall subscribe for and purchase from the Depositor
the Debentures, registered in the name of the Property Trustee on behalf of the
Issuer Trust and having an aggregate principal amount equal to $___________,
and, in satisfaction of the purchase price for such Debentures, the Property
Trustee, on behalf of the Issuer Trust, shall deliver to the Depositor the sum
of $___________ (being the sum of the amounts delivered to the Property Trustee
pursuant to (i) the second sentence of Section 2.4, and (ii) the first sentence
of this Section 2.5).

         SECTION 2.6       Continuation of Trust.

                  The exclusive purposes and functions of the Issuer Trust are
(a) to issue and sell Trust Securities, (b) to use the proceeds from such sale
to acquire an equivalent principal amount of the Debentures, and (c) to engage
in those activities convenient, necessary or incidental thereto. The Depositor
hereby reaffirms the appointment of the Property Trustee and the Delaware
Trustee and appoints or reaffirms the appointment of, as the case may be, the
Administrative Trustees as trustees of the Issuer Trust, to have all the


                                      -12-




rights, powers and duties to the extent set forth herein, and the respective
Issuer Trustees hereby accept such appointment. The Property Trustee hereby
declares that it will hold the Trust Property in trust upon and subject to the
conditions set forth herein for the benefit of the Issuer Trust and the Holders.
The Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Issuer Trust. The Delaware Trustee shall not be entitled to
exercise any powers, nor shall the Delaware Trustee have any of the duties and
responsibilities, of the Property Trustee, the Administrative Trustees or of the
Issuer Trustees generally (except as may be required under the Delaware
Statutory Trust Act) set forth herein. The Delaware Trustee shall be one of the
trustees of the Issuer Trust for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Delaware Statutory Trust Act and for taking
such actions as are required to be taken by a Delaware trustee under the
Delaware Statutory Trust Act.

         SECTION 2.7       Authorization to Enter into Certain Transactions.

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

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

                                    (A) the issuance and sale of the Trust
                           Securities;

                                    (B) causing the Issuer Trust to enter into,
                           and to execute, deliver and perform, the Expense
                           Agreement and the Letter of Representations and such
                           other agreements as may be necessary or desirable in
                           connection with the purposes and function of the
                           Issuer Trust;

                                    (C) assisting in the registration of the
                           Capital Securities under the Act and other applicable
                           securities or blue sky laws and the qualification of
                           this Trust Agreement as a trust indenture under the
                           Trust Indenture Act;

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

                                    (E) the consent to the appointment of a
                           Paying Agent, Authenticating Agent (as defined in the
                           Indenture) and Securities


                                      -13-




                           Registrar in accordance with this Trust Agreement
                           (which consent shall not be unreasonably withheld);

                                    (F) the execution of the Trust Securities on
                           behalf of the Issuer Trust in accordance with this
                           Trust Agreement;

                                    (G) the execution and delivery of closing
                           certificates, if any, pursuant to the Purchase
                           Agreement and application for a taxpayer
                           identification number for the Issuer Trust;

                                    (H) unless otherwise determined by the
                           Property Trustee or Holders of a Majority in
                           Liquidation Amount of the Capital Securities or as
                           otherwise required by the Delaware Statutory Trust
                           Act or the Trust Indenture Act, executing on behalf
                           of the Issuer Trust (either acting alone or together
                           with any or all of the Administrative Trustees) any
                           documents that the Administrative Trustees have the
                           power to execute pursuant to this Trust Agreement;
                           and

                                    (I) the taking of any action incidental to
                           the foregoing as the Issuer Trustees may from time to
                           time determine to be necessary or advisable to give
                           effect to the terms of this Trust Agreement.

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

                                    (A) the establishment of the Payment
                           Account;

                                    (B) the receipt of the Debentures;

                                    (C) the collection of interest, principal
                           and any other payments made in respect of the
                           Debentures and the holding of such amounts in the
                           Payment Account;

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

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

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

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


                                      -14-




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

                                    (I) performing the duties of the Property
                           Trustee set forth in this Trust Agreement; and

                                    (J) after a Trust Event of Default (other
                           than under paragraph (b), (c), (d) or (e) of the
                           definition of such term if such Trust Event of
                           Default is by or with respect to the Property
                           Trustee), the taking of any action incidental to the
                           foregoing as the Property Trustee may from time to
                           time determine is necessary or advisable to give
                           effect to the terms of this Trust Agreement and
                           protect and conserve the Trust Property for the
                           benefit of the Holders (without consideration of the
                           effect of any such action on any particular Holder).

                  (b)      So long as this Trust Agreement remains in effect,
the Issuer Trust (or the Issuer Trustees acting on behalf of the Issuer Trust)
shall not undertake any business, activities or transaction except as expressly
provided herein or contemplated hereby. In particular, the Issuer Trustees
(acting on behalf of the Issuer Trust) shall not (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement, (ii) sell,
assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of
any of the Trust Property or interests therein, including to Holders, except as
expressly provided herein, (iii) take any action that would reasonably be
expected to cause the Issuer Trust to become taxable as a corporation or
classified as other than a grantor trust for United States Federal income tax
purposes or to be required to be registered as an "investment company" under the
Investment Company Act, (iv) incur any indebtedness for borrowed money or issue
any other debt or (v) take or consent to any action that would result in the
placement of a Lien on any of the Trust Property. The Administrative Trustees
shall defend all claims and demands of all Persons at any time claiming any Lien
on any of the Trust Property adverse to the interest of the Issuer Trust or the
Holders in their capacity as Holders.

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

                           (i)      the preparation and filing by the Issuer
                  Trust with the Commission and the execution on behalf of the
                  Issuer Trust of a registration statement on the appropriate
                  form in relation to the Capital Securities, including any
                  amendments thereto and the taking of any action necessary or
                  desirable to sell the Capital Securities in a transaction or a
                  series of transactions pursuant thereto;

                                      -15-





                           (ii)     the determination of the jurisdictions in
                  which to take appropriate action to qualify or register for
                  sale all or part of the Capital Securities and the taking of
                  any and all such acts, other than actions that must be taken
                  by or on behalf of the Issuer Trust, and advice to the Issuer
                  Trust of actions that must be taken by or on behalf of the
                  Issuer Trust, and the preparation for execution and filing of
                  any documents to be executed and filed by the Issuer Trust or
                  on behalf of the Issuer Trust, as the Depositor deems
                  necessary or advisable in order to comply with the applicable
                  securities laws of any such jurisdictions in connection with
                  the sale of the Capital Securities;

                           (iii)    if necessary, the preparation for filing by
                  the Issuer Trust with the Commission and the execution on
                  behalf of the Issuer Trust of a registration statement on Form
                  8-A relating to the registration of the Capital Securities
                  under Section 12(b) or 12(g) of the Exchange Act, including
                  any amendments thereto;

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

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

                  (d)      Notwithstanding anything herein to the contrary, the
Issuer Trustees are authorized and directed to conduct the affairs of the Issuer
Trust and to operate the Issuer Trust so that the Issuer Trust will not be
deemed to be an "investment company" required to be registered under the
Investment Company Act, and will not be taxable as a corporation or classified
as other than a grantor trust for United States Federal income tax purposes so
that the Debentures will be treated as indebtedness of the Depositor for United
States Federal income tax purposes. In this connection, each Administrative
Trustee, the Property Trustee and the Holders of a Majority in Liquidation
Amount of the Common Securities are authorized to take any action, not
inconsistent with applicable law, the Certificate of Trust or this Trust
Agreement, that such Administrative Trustee, the Property Trustee or such
Holders of Common Securities determine in their discretion to be necessary or
desirable for such purposes, as long as such action does not adversely affect in
any material respect the interests of the Holders of the Outstanding Capital
Securities. In no event shall the Issuer Trustees be liable to the Issuer Trust
or the Holders for any failure to comply with this Section that results from a
change in law or regulation or in the interpretation thereof.

         SECTION 2.8       Assets of Trust.

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

         SECTION 2.9       Title to Trust Property.

                  Legal title to all Trust Property shall be vested at all times
in the Property Trustee (in its capacity as such) and shall be held and
administered by the Property Trustee in


                                      -16-




trust for the benefit of the Issuer Trust and the Holders in accordance with
this Trust Agreement.

                                  ARTICLE III

                                 PAYMENT ACCOUNT

         Section 3.1       Payment Account.

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

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

                                   ARTICLE IV

                            DISTRIBUTIONS; REDEMPTION

         SECTION 4.1       Distributions.

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

                           (i)      Distributions on the Trust Securities shall
                  be cumulative, and will accumulate whether or not there are
                  funds of the Issuer Trust available for the payment of
                  Distributions. Distributions shall accumulate from _____,
                  20__, and, except in the event (and to the extent) that the
                  Depositor exercises its right to defer the payment of interest
                  on the Debentures pursuant to the Indenture, shall be payable
                  semi-annually in arrears on _____ and _____ of each year,
                  commencing on _____, 20__. If any date on which a Distribution
                  is otherwise payable on the Trust Securities is not a Business
                  Day, then the payment of such Distribution shall be made on
                  the next succeeding day that is a Business Day (and without
                  any interest or other payment in respect of any such delay),
                  with the same force and effect as if made on the date on which
                  such payment was originally payable (each date on which
                  Distributions are payable in accordance with this Section
                  4.1(a), a "Distribution Date").


                                      -17-





                           (ii)     The Trust Securities shall be entitled to
                  Distributions payable at a rate of ___% per annum of the
                  Liquidation Amount of the Trust Securities. The amount of
                  Distributions payable for any period less than a full
                  Distribution period shall be computed on the basis of a
                  360-day year of twelve 30-day months and the actual number of
                  days elapsed in a partial month in that period. The amount of
                  Distributions payable for any full Distribution period shall
                  be computed by dividing the Distribution rate of ___% per
                  annum by two. The amount of Distributions payable for any
                  period shall include any Additional Amounts in respect of such
                  period.

                           (iii)    Distributions on the Trust Securities shall
                  be made by the Property Trustee from the Payment Account and
                  shall be payable on each Distribution Date only to the extent
                  that the Issuer Trust has funds then on hand and available in
                  the Payment Account for the payment of such Distributions.

                  (b)      Distributions on the Trust Securities with respect to
a Distribution Date shall be payable to the Holders thereof as they appear on
the Securities Register for the Trust Securities at the close of business on the
relevant record date, which shall be at the close of business on the fifteenth
day (whether or not a Business Day) next preceding the relevant Distribution
Date.

         SECTION 4.2       Redemption.

                  (a)      On each Debenture Redemption Date and on the stated
maturity of the Debentures, the Issuer Trust will be required to redeem a Like
Amount of Trust Securities at the Redemption Price.

                  (b)      Notice of redemption shall be given by the Property
Trustee by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date to each Holder of Trust Securities to
be redeemed, at such Holder's address appearing in the Security Register. All
notices of redemption shall state:

                           (i)      the Redemption Date;

                           (ii)     the Redemption Price or, if the Redemption
                  Price cannot be calculated prior to the time the notice is
                  required to be sent, an estimate of the Redemption Price
                  together with a statement that it is an estimate and that the
                  actual Redemption Price will be calculated on the third
                  Business Day prior to the Redemption Date (and if an estimate
                  is provided, a further notice shall be sent of the actual
                  Redemption Price on the date that such Redemption Price is
                  calculated);

                           (iii)    the CUSIP number or CUSIP numbers of the
                  Capital Securities affected (if applicable);


                                      -18-




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

                           (v)      that on the Redemption Date the Redemption
                  Price will become due and payable upon each such Trust
                  Security to be redeemed and that Distributions thereon will
                  cease to accumulate on and after said date, except as provided
                  in Section 4.2(d) below; and

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

                  The Issuer Trust in issuing the Trust Securities may use
"CUSIP" numbers (if then generally in use), and, if so, the Property Trustee
shall indicate the "CUSIP" numbers of the Trust Securities in notices of
redemption and related materials as a convenience to Holders; provided that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Trust Securities or as contained in any
notice of redemption and related materials.

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

                  (d)      If the Property Trustee gives a notice of redemption
in respect of any Capital Securities, then, by 12:00 noon, New York City time,
on the Redemption Date, subject to Section 4.2(c), the Property Trustee will,
with respect to Book-Entry Capital Securities, irrevocably deposit with the
Clearing Agency for such Book-Entry Capital Securities, to the extent available
therefor, funds sufficient to pay the applicable Redemption Price and will give
such Clearing Agency irrevocable instructions and authority to pay the
Redemption Price to the Holders of the Capital Securities. With respect to
Capital Securities that are not Book-Entry Capital Securities, the Property
Trustee, subject to Section 4.2(c), will irrevocably deposit with the Paying
Agent, to the extent available therefor, funds sufficient to pay the applicable
Redemption Price and will give the Paying Agent irrevocable instructions and
authority to pay the Redemption Price to the Holders of the Capital Securities
upon surrender of their Capital Securities Certificates. Notwithstanding the
foregoing, Distributions payable on any Distribution Date or prior to the
Redemption Date for any Trust Securities called for redemption shall be payable
to the Holders of such Trust Securities as they appear on the Securities
Register for the Trust Securities on the relevant record date for such
Distribution Date. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of Holders
holding Trust Securities so called for redemption will terminate, except the
right of such Holders to receive the Redemption Price for such Trust Securities,
but without any interest or other payment for delay in

                                      -19-




receiving the Redemption Price, and such Securities will cease to be
Outstanding. In the event that any date on which any Redemption Price is payable
is not a Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (without any
interest or other payment in respect of any such delay), with the same force and
effect as if made on such date. In the event that payment of the Redemption
Price in respect of any Trust Securities called for redemption is improperly
withheld or refused and not paid either by the Issuer Trust or by the Depositor
or the Guarantor pursuant to the Indenture or the Guarantee Agreement,
Distributions on such Trust Securities will continue to accumulate, as set forth
in Section 4.1, from the Redemption Date originally established by the Issuer
Trust for such Trust Securities to the date such Redemption Price is actually
paid, in which case the actual payment date will be the date fixed for
redemption for purposes of calculating the Redemption Price.

                  (e)      Subject to Section 4.3(a), if less than all the
Outstanding Trust Securities are to be redeemed on a Redemption Date, then the
aggregate Liquidation Amount of Trust Securities to be redeemed shall be
allocated pro rata to the Common Securities and the Capital Securities based
upon the relative Liquidation Amounts of the Trust Securities. The particular
Capital Securities to be redeemed shall be selected on a pro rata basis based
upon their respective Liquidation Amounts not more than 60 days prior to the
Redemption Date by the Property Trustee, using any method deemed by the Property
Trustee to be fair and appropriate, from the Outstanding Capital Securities not
previously called for redemption, provided that so long as the Capital
Securities are in book-entry-only form, such selection shall be made in
accordance with the customary procedures of the Clearing Agency for the Capital
Securities. The Property Trustee shall promptly notify the Securities Registrar
in writing of the Capital Securities selected for redemption and, in the case of
any Capital Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For all purposes of this Trust Agreement, unless the
context otherwise requires, all provisions relating to the redemption of Capital
Securities shall relate, in the case of any Capital Securities redeemed or to be
redeemed only in part, to the portion of the aggregate Liquidation Amount of
Capital Securities that has been or is to be redeemed.

         SECTION 4.3       Subordination of Common Securities.

                  (a)      Payment of Distributions (including any Additional
Amounts) on, the Redemption Price of, and the Liquidation Distribution in
respect of, the Trust Securities, as applicable, shall be made, pro rata among
the Common Securities and the Capital Securities based on the Liquidation Amount
of the Trust Securities; provided, however, that if on any Distribution Date,
Redemption Date or Liquidation Date any Trust Event of Default resulting from a
Debenture Default shall have occurred and be continuing, no payment of any
Distribution (including any Additional Amounts) on, Redemption Price of, or
Liquidation Distribution in respect of, any Common Security, and no other
payment on account of the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of (i) all accumulated
and unpaid Distributions (including any Additional Amounts) on all Outstanding
Capital Securities

                                      -20-




for all Distribution periods terminating on or prior thereto, (ii) in the case
of redemption of Trust Securities, the full amount of the Redemption Price on
all Outstanding Capital Securities then subject to redemption, or (iii) in the
case of any dissolution, liquidation or other termination of the Issuer Trust,
the full amount of such Liquidation Distribution on all Outstanding Capital
Securities, shall have been made or provided for, and all funds immediately
available to the Property Trustee shall first be applied to the payment in full
in cash of all Distributions (including any Additional Amounts) on, or the
Redemption Price of, or Liquidation Distribution in respect of, the Capital
Securities then due and payable.

                  (b)      In the case of the occurrence of any Trust Event of
Default resulting from any Debenture Default, the Holders of the Common
Securities shall have no right to act with respect to any such Trust Event of
Default under this Trust Agreement until the effect of all such Trust Events of
Default with respect to the Capital Securities have been cured, waived or
otherwise eliminated. Until all such Trust Events of Default under this Trust
Agreement with respect to the Capital Securities have been so cured, waived or
otherwise eliminated, the Property Trustee shall act solely on behalf of the
Holders of the Capital Securities and not on behalf of the Holders of the Common
Securities, and only the Holders of the Capital Securities will have the right
to direct the Property Trustee to act on their behalf.

         SECTION 4.4       Payment Procedures.

                  Payments of Distributions (including any Additional Amounts)
on a Distribution Date other than a Redemption Date in respect of the Capital
Securities shall be made by check mailed to the address of the Person entitled
thereto as such address shall appear on the Securities Register or, if the
Capital Securities are held by a Clearing Agency, such Distributions shall be
made to the Clearing Agency in immediately available funds; provided, however,
that a Holder of $1 million or more in Liquidation Amount of Capital Securities
may receive Distributions, other than Distributions payable on a Redemption
Date, by wire transfer of immediately available funds upon written request to
the Issuer Trust not later than 15 calendar days prior to the Distribution Date.
All payments in respect of the Capital Securities on a Redemption Date shall be
made in immediately available funds against presentation and surrender of such
Capital Securities. Payments in respect of the Common Securities shall be made
in such manner as shall be mutually agreed between the Property Trustee and the
Holders of the Common Securities.

         SECTION 4.5       Tax Returns and Reports.

                  The Administrative Trustees shall prepare (or cause to be
prepared), at the Depositor's expense, and file all United States Federal, state
and local tax and information returns and reports required to be filed by or in
respect of the Issuer Trust. In this regard, the Administrative Trustees shall
(a) prepare and file (or cause to be prepared and filed) all Internal Revenue
Service forms required to be filed in respect of the Issuer Trust in each
taxable year of the Issuer Trust, and (b) prepare and furnish (or cause to be
prepared and furnished) to each Holder all Internal Revenue Service forms
required to be


                                      -21-




provided by the Issuer Trust. The Administrative Trustees shall provide the
Depositor and the Property Trustee with a copy of all such returns and reports
promptly after such filing or furnishing. The Issuer Trustees shall comply with
United States Federal withholding and backup withholding tax laws and
information reporting requirements with respect to any payments to Holders under
the Trust Securities.

         SECTION 4.6       Payment of Taxes, Duties, Etc. of the Issuer Trust.

                  Upon receipt under the Debentures of Additional Sums, the
Property Trustee shall promptly pay any taxes, duties or governmental charges of
whatsoever nature (including withholding taxes) imposed on the Issuer Trust by
the United States or any other taxing authority, which were included in such
Additional Sums.

         SECTION 4.7       Payments under Indenture or Pursuant to Direct
Actions.

                  Any amount payable hereunder to any Holder of Capital
Securities (or any Owner with respect thereto) shall be reduced by the amount of
any corresponding payment such Holder (or Owner) has directly received pursuant
to Section 5.9 of the Indenture or Section 5.13(c) of this Trust Agreement.

                                   ARTICLE V

                          TRUST SECURITIES CERTIFICATES

         SECTION 5.1       Initial Ownership.

                  Upon the formation of the Issuer Trust and the contribution by
the Depositor pursuant to Section 2.3 and until the issuance of the Trust
Securities, and at any time during which no Trust Securities are outstanding,
the Depositor shall be the sole beneficial owner of the Issuer Trust.

         SECTION 5.2       The Trust Securities Certificates.

                  (a)      The Capital Securities Certificates shall be issued
in minimum denominations of $1,000 Liquidation Amount and integral multiples
thereof, and the Common Securities Certificates shall be issued in denominations
of $1,000 Liquidation Amount and integral multiples thereof. The Trust
Securities Certificates shall be executed on behalf of the Issuer Trust by
manual signature or facsimile of at least one Administrative Trustee. Trust
Securities Certificates bearing the manual signatures or facsimiles of
individuals who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Issuer Trust, shall be validly issued and
entitled to the benefits of this Trust Agreement, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
delivery of such Trust Securities Certificates or did not hold such offices at
the date of delivery of such Trust Securities Certificates. A transferee of a
Trust Securities Certificate shall become a Holder, and shall be entitled to the
rights and subject to the obligations of a Holder


                                      -22-




hereunder, upon due registration of such Trust Securities Certificate in such
transferee's name pursuant to Section 5.5.

                  (b)      Upon their original issuance, Capital Securities
Certificates shall be issued in the form of one or more Book-Entry Capital
Securities Certificates registered in the name of DTC, as Clearing Agency, or
its nominee and deposited with DTC or a custodian for DTC for credit by DTC to
the respective accounts of the Owners thereof (or such other accounts as they
may direct).

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

         SECTION 5.3       Execution and Delivery of Trust Securities
Certificates.

                  On the Closing Date, the Administrative Trustees shall cause
Trust Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.4 and 2.5, to be executed on behalf of the Issuer Trust and delivered
to or upon the written order of the Depositor, executed by one authorized
officer thereof, without further corporate action by the Depositor, in
authorized denominations.

         SECTION 5.4       Book-Entry Capital Securities.

                  (a)      Each Book-Entry Capital Securities Certificate issued
under this Agreement shall be registered in the name of the Clearing Agency or a
nominee thereof and delivered to such Clearing Agency or a nominee thereof or
custodian therefor, and each such Book-Entry Capital Securities Certificate
shall constitute a single Capital Securities Certificate for all purposes of
this Agreement.

                  (b)      Notwithstanding any other provision in this Trust
Agreement, no Book-Entry Capital Securities Certificate may be exchanged in
whole or in part for Capital Securities Certificates registered, and no transfer
of a Book-Entry Capital Securities Certificate in whole or in part may be
registered, in the name of any Person other than the Clearing Agency for such
Book-Entry Capital Securities Certificates or a nominee thereof unless (i) the
Clearing Agency advises the Issuer Trust in writing that the Clearing Agency is
no longer willing or able to properly discharge its responsibilities with
respect to the Book-Entry Capital Securities Certificates, and a qualified
successor shall not have been appointed, or the Clearing Agency ceases to be a
clearing agency registered under the Exchange Act within 90 calendar days at a
time when it is required to be so registered to act as such clearing agent, (ii)
the Issuer Trust at its option determines that a Book Entry Capital Securities
Certificate shall be so exchangeable, or (iii) a Trust Event of Default has
occurred and is continuing. Upon the occurrence of any event specified in clause
(i), (ii) or (iii) above, the Property Trustee shall notify the Clearing Agency
and instruct the Clearing Agency to notify all Owners of Book-Entry Capital
Securities, the Delaware Trustee and the Administrative Trustees of the
occurrence of such event and of the availability of the Definitive Capital
Securities Certificates to Owners of such Book-Entry Capital Securities,
requesting the same.


                                      -23-




                  (c)      If any Book-Entry Capital Securities Certificate is
to be exchanged for other Capital Securities Certificates or cancelled in part,
or if any other Capital Securities Certificate is to be exchanged in whole or in
part for Book-Entry Capital Securities represented by a Book-Entry Capital
Securities Certificate, then either (i) such Book-Entry Capital Securities
Certificate shall be so surrendered for exchange or cancellation as provided in
this Article V or (ii) the aggregate Liquidation Amount represented by such
Book-Entry Capital Securities Certificate shall be reduced, subject to Section
5.2, or increased by an amount equal to the Liquidation Amount represented by
that portion of the Book-Entry Capital Securities Certificate to be so exchanged
or cancelled, or equal to the Liquidation Amount represented by such other
Capital Securities Certificates to be so exchanged for Book-Entry Capital
Securities represented thereby, as the case may be, by means of an appropriate
adjustment made on the records of the Securities Registrar, whereupon the
Property Trustee, in accordance with the Applicable Procedures, shall instruct
the Clearing Agency or its authorized representative to make a corresponding
adjustment to its records. Upon surrender to the Administrative Trustees or the
Securities Registrar of the Book-Entry Capital Securities Certificate or
Certificates by the Clearing Agency, accompanied by registration instructions,
the Administrative Trustees, or any one of them, shall execute the Definitive
Capital Securities Certificates in accordance with the instructions of the
Clearing Agency. Neither the Securities Registrar nor any Issuer Trustee shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Capital Securities Certificates, the Issuer Trustees
shall recognize the Holders of the Definitive Capital Securities Certificates as
Holders. The Definitive Capital Securities Certificates shall be typewritten,
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by the
execution thereof by the Administrative Trustees or any one of them.

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

                  (e)      The Clearing Agency or its nominee, as registered
owner of a Book-Entry Capital Securities Certificate, shall be the Holder of
such Book-Entry Capital Securities Certificate for all purposes under this
Agreement and the Book-Entry Capital Securities Certificate, and Owners with
respect to a Book-Entry Capital Securities Certificate shall hold such interests
pursuant to the Applicable Procedures. The Securities Registrar and the Issuer
Trustees shall be entitled to deal with the Clearing Agency for all purposes of
this Trust Agreement relating to the Book-Entry Capital Securities Certificates
(including the payment of the Redemption Price of and Distributions on the
Book-Entry Capital Securities represented thereby and the giving of instructions
or directions by Owners of Book-Entry Capital Securities represented thereby) as
the sole Holder of the Book-Entry


                                      -24-




Capital Securities represented thereby and shall have no obligations to the
Owners thereof. Solely for the purpose of determining whether the Holders of the
requisite Liquidation Amount of Capital Securities have voted on any matter
provided for in this Trust Agreement, so long as Definitive Capital Securities
Certificates have not been issued, the Issuer Trustees may conclusively rely on,
and shall be protected in relying on, any written instrument (including a proxy)
delivered to the Issuer Trustees by the Clearing Agency setting forth the
Owners' votes or assigning the right to vote on any matter to any other Persons
in whole or in part. Neither the Securities Registrar nor any Issuer Trustee
shall have any liability in respect of any transfers effected by the Clearing
Agency.

                  The rights of the Owners of the Book-Entry Capital Securities
shall be exercised only through the Clearing Agency and shall be limited to
those established by law, the Applicable Procedures and agreements between such
Owners and the Clearing Agency and/or the Clearing Agency Participants. Pursuant
to the Letter of Representations, unless and until Definitive Capital Securities
Certificates are issued pursuant to Section 5.4(b), the initial Clearing Agency
will make book-entry transfers among the Clearing Agency Participants and
receive and transmit payments on the Capital Securities to such Clearing Agency
Participants, and none of the Depositor, the Guarantor or the Issuer Trustees
shall have any responsibility or obligation with respect thereto.

         SECTION 5.5       Registration of Transfer and Exchange of Capital
Securities Certificates.

                  (a)      The Property Trustee shall keep or cause to be kept,
at the office or agency maintained pursuant to Section 5.9, a register or
registers for the purpose of registering Trust Securities Certificates and
transfers and exchanges of Trust Securities Certificates (the "Securities
Register") in which the registrar and transfer agent with respect to the Trust
Securities (the "Securities Registrar"), subject to such reasonable regulations
as it may prescribe, shall provide for the registration of Capital Securities
Certificates and Common Securities Certificates (subject to Section 5.11 in the
case of the Common Securities Certificates) and registration of transfers and
exchanges of Capital Securities Certificates as herein provided. The Person
acting as the Property Trustee shall at all times also be the Securities
Registrar.

                  Upon surrender for registration of transfer of any Capital
Securities Certificate at the office or agency maintained pursuant to Section
5.9, the Administrative Trustees or any one of them shall execute and deliver to
the Property Trustee, and the Property Trustee shall deliver, in the name of the
designated transferee or transferees, one or more new Capital Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of execution by such Administrative Trustee or Trustees.

                  The Securities Registrar shall not be required (i) to issue,
register the transfer of or exchange any Capital Security during a period
beginning at the opening of business 15 calendar days before the first mailing
of the notice of redemption, or (ii) to register the


                                      -25-




transfer of or exchange any Capital Security so selected for redemption in whole
or in part, except, in the case of any such Capital Security to be redeemed in
part, any portion thereof not to be redeemed.

                  Every Capital Securities Certificate presented or surrendered
for registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form reasonably satisfactory to an Administrative
Trustee and the Securities Registrar duly executed by the Holder or its attorney
duly authorized in writing. Each Capital Securities Certificate surrendered for
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Property Trustee in accordance with its customary practice.

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

                  (b)      Notwithstanding any other provision of this
Agreement, transfers and exchanges of Capital Securities Certificates and
beneficial interests in a Book-Entry Capital Securities Certificate of the kinds
specified in this Section 5.5(b) shall be made only in accordance with this
Section 5.5(b).

                           (i)      Non-Book-Entry Capital Securities
                  Certificate to Book-Entry Capital Securities Certificate. If
                  the Holder of a Capital Securities Certificate (other than a
                  Book-Entry Capital Securities Certificate) wishes at any time
                  to transfer all or any portion of such Capital Securities
                  Certificate to a Person who wishes to take delivery thereof in
                  the form of a beneficial interest in a Book-Entry Capital
                  Securities Certificate, such transfer may be effected only in
                  accordance with the provisions of this Clause (b)(i) and
                  subject to the Applicable Procedures. Upon receipt by the
                  Securities Registrar of (A) such Capital Securities
                  Certificate as provided in Section 5.5(a) and instructions
                  satisfactory to the Securities Registrar directing that a
                  beneficial interest in the Book-Entry Capital Securities
                  Certificate of a specified Liquidation Amount of Capital
                  Securities not greater than the Liquidation Amount of Capital
                  Securities represented by such Capital Securities Certificate
                  be credited to a specified Clearing Agency Participant's
                  account, then the Securities Registrar shall cancel such
                  Capital Securities Certificate (and issue a new Capital
                  Securities Certificate in respect of any untransferred portion
                  thereof) as provided in Section 5.5(a) and increase the
                  aggregate Liquidation Amount of the Book-Entry Capital
                  Securities Certificate by the Liquidation Amount represented
                  by such Capital Securities so transferred as provided in
                  Section 5.4(c).

                           (ii)     Non-Book-Entry Capital Securities
                  Certificate to Non-Book-Entry Capital Securities Certificate.
                  A Capital Securities Certificate that is not a Book-Entry
                  Capital Securities Certificate may be transferred, in whole or
                  in part, to a Person who takes delivery in the form of another
                  Capital Securities Certificate


                                      -26-




                  that is not a Book-Entry Capital Securities Certificate as
                  provided in Section 5.5(a).

                           (iii)    Exchanges between Book-Entry Capital
                  Securities Certificate and Non-Book-Entry Capital Securities
                  Certificate. A beneficial interest in a Book-Entry Capital
                  Securities Certificate may be exchanged for a Capital
                  Securities Certificate that is not a Book-Entry Capital
                  Securities Certificate as provided in Section 5.4.

         SECTION 5.6       Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.

                  If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Securities Registrar, or if the Securities Registrar shall
receive evidence to its reasonable satisfaction of the destruction, loss or
theft of any Trust Securities Certificate, and (b) there shall be delivered to
the Securities Registrar and the Administrative Trustees such security or
indemnity as may be required by them to save each of them harmless, then in the
absence of notice that such Trust Securities Certificate shall have been
acquired by a bona fide purchaser, the Administrative Trustees, or any one of
them, on behalf of the Issuer Trust shall execute and make available for
delivery, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Trust Securities Certificate, a new Trust Securities Certificate of like
tenor and denomination. In connection with the issuance of any new Trust
Securities Certificate under this Section 5.6, the Administrative Trustees or
the Securities Registrar may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Trust Securities Certificate issued pursuant to this
Section shall constitute conclusive evidence of an undivided beneficial interest
in the assets of the Issuer Trust corresponding to that evidenced by the lost,
stolen or destroyed Trust Securities Certificate, as if originally issued,
whether or not the lost, stolen or destroyed Trust Securities Certificate shall
be found at any time.

         SECTION 5.7       Persons Deemed Holders.

                  The Issuer Trustees and the Securities Registrar shall each
treat the Person in whose name any Trust Securities Certificate shall be
registered in the Securities Register as the owner and Holder of such Trust
Securities Certificate for the purpose of receiving Distributions and for all
other purposes whatsoever, and neither the Securities Registrar nor any Issuer
Trustee shall be bound by any notice to the contrary.

         SECTION 5.8       Access to List of Holders' Names and Addresses.

                  Each Holder and each Owner shall be deemed to have agreed not
to hold the Depositor, the Property Trustee, the Delaware Trustee or the
Administrative Trustees accountable by reason of the disclosure of its name and
address, regardless of the source from which such information was derived.


                                      -27-




         SECTION 5.9       Maintenance of Office or Agency.

                  The Property Trustee shall designate, with the consent of the
Administrative Trustees, which consent shall not be unreasonably withheld, an
office or offices or agency or agencies where Capital Securities Certificates
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Issuer Trustees in respect of the Trust Securities
Certificates may be served. The Administrative Trustees initially designate J.P.
Morgan Trust Company, National Association, 227 W. Monroe, Suite 2600, Chicago,
Illinois 60606, Attention: George Reaves, as its office and agency for such
purposes. The Property Trustee shall give prompt written notice to the
Depositor, the Administrative Trustees and to the Holders of any change in the
location of the Securities Register or any such office or agency.

         SECTION 5.10      Appointment of Paying Agent.

                  The Paying Agent shall make payments of Distributions, the
Redemption Price and the Liquidation Distributions to Holders from the Payment
Account and shall report the amounts of such Distributions to the Property
Trustee and the Administrative Trustees. Any Paying Agent shall have the
revocable power to withdraw funds from the Payment Account solely for the
purpose of making the Distributions referred to above. The Administrative
Trustees may revoke such power and remove the Paying Agent in their sole
discretion. The Paying Agent shall initially be the Bank. Any Person acting as
Paying Agent shall be permitted to resign as Paying Agent upon 30 days' written
notice to the Administrative Trustees and the Property Trustee. If the Bank
shall no longer be the Paying Agent or a successor Paying Agent shall resign or
its authority to act be revoked, the Administrative Trustees shall appoint a
successor (which shall be a bank or trust company) to act as Paying Agent. Such
successor Paying Agent or any additional Paying Agent appointed by the
Administrative Trustees shall execute and deliver to the Issuer Trustees an
instrument in which such successor Paying Agent or additional Paying Agent shall
agree with the Issuer Trustees that as Paying Agent, such successor Paying Agent
or additional Paying Agent will hold all sums, if any, held by it for payment to
the Holders in trust for the benefit of the Holders entitled thereto until such
sums shall be paid to such Holders. The Paying Agent shall return all unclaimed
funds to the Property Trustee and upon removal of a Paying Agent such Paying
Agent shall also return all funds in its possession to the Property Trustee. The
provisions of Sections 8.1, 8.3 and 8.6 herein shall apply to the Bank also in
its role as Paying Agent, for so long as the Bank shall act as Paying Agent and,
to the extent applicable, to any other paying agent appointed hereunder. Any
reference in this Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.

         SECTION 5.11      Ownership of Common Securities by Depositor.

                  On the Closing Date, the Depositor shall acquire, and
thereafter shall retain, beneficial and record ownership of the Common
Securities. To the fullest extent permitted by applicable law, the Depositor may
not transfer the Common Securities except (i) in connection with a consolidation
or merger of the Depositor into another


                                      -28-




corporation, or any conveyance, transfer or lease by the Depositor of its
properties and assets substantially as an entirety to any Person, pursuant to
Section 8.1 of the Indenture, or (ii) to an Affiliate of the Depositor in
compliance with applicable law (including the Securities Act and other
applicable securities and blue sky laws). To the fullest extent permitted by
law, any attempted transfer of the Common Securities other than as set forth in
the proceeding sentence shall be void. The Administrative Trustees shall cause
each Common Securities Certificate issued to the Depositor to contain a legend
stating substantially "TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THIS
CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO AN AFFILIATE OF THE DEPOSITOR IN
COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11 OF THE TRUST AGREEMENT AND ONLY
IN CONNECTION WITH A SIMULTANEOUS DELEGATION AND ASSIGNMENT OF THE EXPENSE
AGREEMENT REFERRED TO THEREIN."

         SECTION 5.12      Notices to Clearing Agency.

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

         SECTION 5.13      Rights of Holders; Waivers of Past Defaults.

                  (a)      The legal title to the Trust Property is vested
exclusively in the Property Trustee (in its capacity as such) in accordance with
Section 2.9, and the Holders shall not have any right or title therein other
than the undivided beneficial interest in the assets of the Issuer Trust
conferred by their Trust Securities and they shall have no right to call for any
partition or division of property, profits or rights of the Issuer Trust except
as described below. The Trust Securities shall be personal property giving only
the rights specifically set forth therein and in this Trust Agreement. The Trust
Securities shall have no preemptive or similar rights and when issued and
delivered to Holders against payment of the purchase price therefor will be
fully paid and, to the fullest extent permitted by applicable law, nonassessable
by the Issuer Trust. The Holders of the Trust Securities, in their capacities as
such, shall be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.

                  (b)      For so long as any Capital Securities remain
Outstanding, if a Debenture Event of Default under Section 5.1(1) occurs and
continues and the Debenture Trustee or the holders of not less than 25% in
principal amount of the outstanding Debentures fail to declare the principal of
all of the Debentures to be immediately due and payable, the Holders of at least
25% in Liquidation Amount of the Capital Securities then Outstanding shall have
the right to make such declaration by a notice in writing to the Property
Trustee, the Depositor and the Debenture Trustee. If a Debenture Event of
Default under Sections 5.1(2) or 5.1(3) of the Indenture occurs and continues,
the entire principal of and


                                      -29-




all accrued but unpaid interest on the Debentures will be due and payable
immediately without further action in accordance with Section 5.3 of the
Indenture.

                  At any time after a declaration of acceleration with respect
to the Debentures has been made and before a judgment or decree for payment of
the money due has been obtained by the Debenture Trustee as provided in the
Indenture, if the Property Trustee fails to annul any such declaration, the
Holders of a Majority in Liquidation Amount of the Capital Securities, by
written notice to the Property Trustee, the Depositor, the Guarantor and the
Debenture Trustee, may rescind and annul such declaration and its consequences
if:

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

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

                                    (B) all Additional Sums and any accrued
                           Additional Interest on all of the Debentures,

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

                                    (D) all sums paid or advanced by the
                           Debenture Trustee under the Indenture and the
                           reasonable compensation, expenses, disbursements and
                           advances of the Debenture Trustee and the Property
                           Trustee, their agents and counsel; and

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

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

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


                                      -30-




business on the day the Property Trustee receives such notice. The Holders on
such record date, or their duly designated proxies, and only such Persons, shall
be entitled to join in such notice, whether or not such Holders remain Holders
after such record date; provided, that, unless such declaration of acceleration,
or rescission and annulment, as the case may be, shall have become effective by
virtue of the requisite percentage having joined in such notice prior to the day
that is 90 days after such record date, such notice of declaration of
acceleration, or rescission and annulment, as the case may be, shall
automatically and without further action by any Holder be canceled and of no
further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of
a Holder, from giving, after expiration of such 90-day period, a new written
notice of declaration of acceleration, or rescission and annulment thereof, as
the case may be, that is identical to a written notice that has been canceled
pursuant to the proviso to the preceding sentence, in which event a new record
date shall be established pursuant to the provisions of this Section 5.13(b).

                  (c)      For so long as any Capital Securities remain
Outstanding, to the fullest extent permitted by law and subject to the terms of
this Trust Agreement and the Indenture, upon a Debenture Default specified in
Sections 5.2(1) or 5.2(2) of the Indenture, any Holder of Capital Securities
shall have the right to institute a proceeding directly against the Depositor or
the Guarantor, pursuant to Section 5.9 of the Indenture, for enforcement of
payment to such Holder of any amounts payable in respect of Debentures having an
aggregate principal amount equal to the aggregate Liquidation Amount of the
Capital Securities of such Holder (a "Direct Action"). Except as set forth in
Section 5.13(b) and this Section 5.13(c), the Holders of Capital Securities
shall have no right to exercise directly any right or remedy available to the
holders of, or in respect of, the Debentures. In addition, a Holder may
institute a legal proceeding directly against the Depositor or the Guarantor
under the Guarantee Agreement to enforce its rights under the Guarantee
Agreement without first instituting a legal proceeding against the Guarantee
Trustee (as defined in the Guarantee Agreement), the Issuer Trust, any Issuer
Trustee or any Person or entity.

                  (d)      Except as otherwise provided in clauses (a), (b) and
(c) of this Section 5.13, the Holders of a Majority in Liquidation Amount of the
Capital Securities may, on behalf of the Holders of all the Capital Securities,
waive any past default or Trust Event of Default and its consequences. Upon such
waiver, any such default or Trust Event of Default shall cease to exist, and any
default or Trust Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Trust Agreement, but no such waiver shall
extend to any subsequent or other default or Trust Event of Default or impair
any right consequent thereon.


                                      -31-




                                   ARTICLE VI

                        ACTS OF HOLDERS; MEETINGS; VOTING

         SECTION 6.1       Limitations on Voting Rights.

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

                  (b)      So long as any Debentures are held by the Property
Trustee on behalf of the Issuer Trust, the Property Trustee shall not (i) direct
the time, method and place of conducting any proceeding for any remedy available
to the Debenture Trustee, or execute any trust or power conferred on the
Debenture Trustee with respect to the Debentures, (ii) waive any past default
that may be waived under Section 5.14 of the Indenture, (iii) exercise any right
to rescind or annul a declaration that the principal of all the Debentures shall
be due and payable, or (iv) consent to any amendment, modification or
termination of the Indenture or the Debentures where such consent shall be
required, without, in each case, obtaining the prior approval of the Holders of
a Majority in Liquidation Amount of the Capital Securities, provided, however,
that where a consent under the Indenture would require the consent of each
Holder of Debentures affected thereby, no such consent shall be given by the
Property Trustee without the prior written consent of each Holder of Capital
Securities. The Property Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Capital Securities,
except by a subsequent vote of the Holders of the Capital Securities. The
Property Trustee shall notify all Holders of the Capital Securities of any
notice of default received with respect to the Debentures. In addition to
obtaining the foregoing approvals of the Holders of the Capital Securities,
prior to taking any of the foregoing actions, the Property Trustee shall, at the
expense of the Depositor, obtain an Opinion of Counsel experienced in such
matters to the effect that such action shall not cause the Issuer Trust to be
taxable as a corporation or classified as other than a grantor trust for United
States Federal income tax purposes or to be required to be registered as an
"investment company" under the Investment Company Act.

                  (c)      If any proposed amendment to the Trust Agreement
provides for, or the Issuer Trustees otherwise propose to effect, (i) any action
that would adversely affect in any material respect the powers, preferences or
special rights of the Capital Securities, whether by way of amendment to this
Trust Agreement or otherwise, or (ii) the dissolution, winding-up or termination
of the Issuer Trust, other than pursuant to the terms of this Trust Agreement,
then the Holders of Outstanding Capital Securities will be entitled to vote on
such amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of a Majority in Liquidation Amount of
the Capital Securities. Notwithstanding any other provision of this Trust


                                      -32-




Agreement, no amendment to this Trust Agreement may be made if, as a result of
such amendment, it would cause the Issuer Trust to be taxable as a corporation
or classified as other than a grantor trust for United States Federal income tax
purposes or to be required to be registered as an "investment company" under the
Investment Company Act.

         SECTION 6.2       Notice of Meetings.

                  Notice of all meetings of the Holders of the Capital
Securities, stating the time, place and purpose of the meeting, shall be given
by the Property Trustee pursuant to Section 10.8 to each Holder of Capital
Securities, at such Holder's registered address, at least 15 days and not more
than 90 days before the meeting. At any such meeting, any business properly
before the meeting may be so considered whether or not stated in the notice of
the meeting. Any adjourned meeting may be held as adjourned without further
notice.

         SECTION 6.3       Meetings of Holders of the Capital Securities.

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

                  The Holders of a Majority in Liquidation Amount of the Capital
Securities, present in person or by proxy, shall constitute a quorum at any
meeting of the Holders of the Capital Securities.

                  If a quorum is present at a meeting, an affirmative vote by
the Holders present, in person or by proxy, holding Capital Securities
representing a Majority in Liquidation Amount of the Capital Securities held by
the Holders present, either in person or by proxy, at such meeting shall
constitute the action of the Holders of the Capital Securities, unless this
Trust Agreement requires a greater number of affirmative votes.

         SECTION 6.4       Voting Rights.

                  Holders shall be entitled to one vote for each $1,000 of
Liquidation Amount represented by their Outstanding Trust Securities in respect
of any matter as to which such Holders are entitled to vote.

         SECTION 6.5       Proxies, etc.

                  At any meeting of Holders, any Holder entitled to vote thereat
may vote by proxy, provided that no proxy shall be voted at any meeting unless
it shall have been placed on file with the Administrative Trustees, or with such
other officer or agent of the Issuer Trust as the Administrative Trustees may
direct, for verification prior to the time at which such vote shall be taken.
Pursuant to a resolution of the Property Trustee, proxies may be


                                      -33-




solicited in the name of the Property Trustee or one or more officers of the
Property Trustee. Only Holders of record shall be entitled to vote. When Trust
Securities are held jointly by several persons, any one of them may vote at any
meeting in person or by proxy in respect of such Trust Securities, but if more
than one of them shall be present at such meeting in person or by proxy, and
such joint owners or their proxies so present disagree as to any vote to be
cast, such vote shall not be received in respect of such Trust Securities. A
proxy purporting to be executed by or on behalf of a Holder shall be deemed
valid unless challenged at or prior to its exercise, and the burden of proving
invalidity shall rest on the challenger. No proxy shall be valid more than three
years after its date of execution.

         SECTION 6.6       Holder Action by Written Consent.

                  Any action that may be taken by Holders at a meeting may be
taken without a meeting if Holders holding a Majority in Liquidation Amount of
all Capital Securities entitled to vote in respect of such action (or such
larger proportion thereof as shall be required by any other provision of this
Trust Agreement) shall consent to the action in writing.

         SECTION 6.7       Record Date for Voting and Other Purposes.

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

         SECTION 6.8       Acts of Holders.

                  Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Trust Agreement to
be given, made or taken by Holders may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such Holders in person
or by an agent duly appointed in writing; and, except as otherwise expressly
provided herein, such action shall become effective when such instrument or
instruments is or are delivered to an Administrative Trustee. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Trust
Agreement and (subject to Section 8.1) conclusive in favor of the Issuer
Trustees, if made in the manner provided in this Section.

                  The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate


                                      -34-




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

                  The ownership of Trust Securities shall be proved by the
Securities Register.

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

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

                  If any dispute shall arise among the Holders or the Issuer
Trustees with respect to the authenticity, validity or binding nature of any
request, demand, authorization, direction, consent, waiver or other action of
such Holder or Issuer Trustee under this Article VI, then the determination of
such matter by the Property Trustee shall be conclusive with respect to such
matter.

         SECTION 6.9       Inspection of Records.

                  Upon reasonable notice to the Administrative Trustees and the
Property Trustee, the records of the Issuer Trust shall be open to inspection by
Holders during normal business hours for any purpose reasonably related to such
Holder's interest as a Holder.

                                  ARTICLE VII

                         REPRESENTATIONS AND WARRANTIES

         SECTION 7.1       Representations and Warranties of the Property
Trustee and the Delaware Trustee.

                  The Property Trustee and the Delaware Trustee, each severally
on behalf of and as to itself, hereby represents and warrants for the benefit of
the Depositor and the Holders that:


                                      -35-




                  (a)      the Property Trustee is a national banking
association, duly organized, validly existing and in good standing under the
laws of the United States;

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

                  (c)      the Delaware Trustee is a national banking
association with its principal place of business in the State of Delaware;

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

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

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

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


                                      -36-




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

         SECTION 7.2       Representations and Warranties of Depositor.

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

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

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

                                  ARTICLE VIII

                               THE ISSUER TRUSTEES

         SECTION 8.1       Certain Duties and Responsibilities.

                  (a)      The duties and responsibilities of the Issuer
Trustees shall be as provided by this Trust Agreement and, in the case of the
Property Trustee, subject to Section 10.10 hereof. Notwithstanding the
foregoing, no provision of this Trust Agreement shall require any of the Issuer
Trustees to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. Whether or not therein expressly
so provided, every provision of this Trust Agreement relating to the conduct or
affecting the liability of or affording protection to the Issuer Trustees shall
be subject to the provisions of this Section 8.1. Nothing in this Trust
Agreement shall be construed to release an Administrative Trustee from liability
for his or her own negligent action, his or her own negligent failure to act, or
his or her own willful misconduct. To the extent that, at law or in equity, an
Issuer Trustee has duties and liabilities relating to the Issuer Trust or to the
Holders, such Issuer Trustee shall not be liable to the Issuer Trust or to any
Holder for such Issuer Trustee's good faith reliance on the provisions of this
Trust Agreement. The provisions of this

                                      -37-




Trust Agreement, to the extent that they restrict the duties and liabilities
of the Issuer Trustees otherwise existing at law or in equity, are agreed by
the Depositor and the Holders to replace such other duties and liabilities of
the Issuer Trustees.

                  (b)      All payments made by the Property Trustee or a Paying
Agent in respect of the Trust Securities shall be made only from the revenue and
proceeds from the Trust Property and only to the extent that there shall be
sufficient revenue or proceeds from the Trust Property to enable the Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
Each Holder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that the Issuer Trustees
are not personally liable to it for any amount distributable in respect of any
Trust Security or for any other liability in respect of any Trust Security. This
Section 8.1(b) does not limit the liability of the Issuer Trustees expressly set
forth elsewhere in this Trust Agreement or, in the case of the Property Trustee,
in the Trust Indenture Act.

                  (c)      The Property Trustee, before the occurrence of any
Trust Event of Default and after the curing of all Trust Events of Default that
may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Trust Agreement (including pursuant to Section
10.10), and no implied covenants shall be read into this Trust Agreement against
the Property Trustee. If a Trust Event of Default has occurred and is
continuing, the Property Trustee shall exercise such of the rights and powers
vested in it by this Trust Agreement, 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.

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

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

                                    (A) the duties and obligations of the
                           Property Trustee shall be determined solely by the
                           express provisions of this Trust Agreement (including
                           pursuant to Section 10.10), and the Property Trustee
                           shall not be liable except for the performance of
                           such duties and obligations as are specifically set
                           forth in this Trust Agreement (including pursuant to
                           Section 10.10); and

                                    (B) in the absence of bad faith on the part
                           of the Property Trustee, the Property 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 Property Trustee and conforming to the
                           requirements of this Trust Agreement; but in the case
                           of any such certificates or opinions that by any
                           provision hereof or of the Trust

                                      -38-




                           Indenture Act are specifically required to be
                           furnished to the Property Trustee, the Property
                           Trustee shall be under a duty to examine the same to
                           determine whether or not they conform to the
                           requirements of this Trust Agreement.

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

                           (iii)    the Property Trustee shall not be liable
                  with respect to any action taken or omitted to be taken by it
                  in good faith in accordance with the direction of the Holders
                  of 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 Property Trustee,
                  or exercising any trust or power conferred upon the Property
                  Trustee under this Trust Agreement;

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

                           (v)      the Property Trustee shall not be liable for
                  any interest on any money received by it except as it may
                  otherwise agree with the Depositor; and money held by the
                  Property Trustee need not be segregated from other funds held
                  by it except in relation to the Payment Account maintained by
                  the Property Trustee pursuant to Section 3.1 and except to the
                  extent otherwise required by law;

                           (vi)     the Property Trustee shall not be
                  responsible for monitoring the compliance by the
                  Administrative Trustees or the Depositor with their respective
                  duties under this Trust Agreement, nor shall the Property
                  Trustee be liable for the default or misconduct of any other
                  Issuer Trustee or the Depositor; and

                           (vii)    No provision of this Trust Agreement shall
                  require the Property 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 Property Trustee shall have
                  reasonable grounds for believing that the repayment of such
                  funds or liability is not reasonably assured to it under the
                  terms of this Trust Agreement or adequate indemnity against
                  such risk or liability is not reasonably assured to it.

                  (e)      The Administrative Trustees shall not be responsible
for monitoring the compliance by the other Issuer Trustees or the Depositor with
their respective duties under this Trust Agreement, nor shall either
Administrative Trustee be liable for the


                                      -39-




default or misconduct of any other Administrative Trustee, the other Issuer
Trustees or the Depositor.

         SECTION 8.2       Certain Notices.

                  Within five calendar days after the occurrence of any Trust
Event of Default actually known to the Property Trustee, the Property Trustee
shall transmit, in the manner and to the extent provided in Section 10.8, notice
of such Trust Event of Default to the Holders, the Administrative Trustees and
the Depositor, unless such Trust Event of Default shall have been cured or
waived.

                  Within five calendar days after the receipt of notice of the
Depositor's exercise of its right to defer the payment of interest on the
Debentures pursuant to the Indenture, the Administrative Trustees shall
transmit, in the manner and to the extent provided in Section 10.8, notice of
such exercise to the Holders, unless such exercise shall have been revoked.

                  The Property Trustee shall not be deemed to have knowledge of
any Trust Event of Default unless the Property Trustee shall have received
written notice or a Responsible Officer of the Property Trustee charged with the
administration of this Trust Agreement shall have obtained actual knowledge of
such Trust Event of Default.

         SECTION 8.3       Certain Rights of Property Trustee.

                  Subject to the provisions of Section 8.1:

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

                  (b)      if (i) in performing its duties under this Trust
Agreement the Property Trustee is required to decide between alternative courses
of action, (ii) in construing any of the provisions of this Trust Agreement the
Property Trustee finds the same ambiguous or inconsistent with any other
provisions contained herein, or (iii) the Property Trustee is unsure of the
application of any provision of this Trust Agreement, then, except as to any
matter as to which the Holders of the Capital Securities are entitled to vote
under the terms of this Trust Agreement, the Property Trustee shall deliver a
notice to the Depositor requesting the Depositor's opinion as to the course of
action to be taken and the Property Trustee shall take such action, or refrain
from taking such action, as the Property Trustee shall be instructed in writing
to take, or to refrain from taking, by the Depositor; provided, however, that if
the Property Trustee does not receive such instructions of the Depositor within
ten Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from


                                      -40-




taking such action not inconsistent with this Trust Agreement as it shall deem
advisable and in the best interests of the Holders, in which event the Property
Trustee shall have no liability except for its own bad faith, negligence or
willful misconduct;

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

                  (d)      any direction or act of an Administrative Trustee
contemplated by this Trust Agreement shall be sufficiently evidenced by a
certificate executed by such Administrative Trustee and setting forth such
direction or act;

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

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

                  (g)      the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Holders pursuant to this Trust Agreement,
unless such Holders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction; provided that,
nothing contained in this Section 8.3(g) shall be taken to relieve the Property
Trustee, upon the occurrence of a Trust Event of Default, of its obligation to
exercise the rights and powers vested in it by this Trust Agreement;

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

                  (i)      the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through its agents or attorneys, provided that the Property Trustee shall be
responsible for its own negligence or misconduct with respect to selection of
any agent or attorney appointed by it hereunder;

                  (j)      whenever in the administration of this Trust
Agreement the Property Trustee shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (i) may request

                                      -41-




instructions from the Holders (which instructions may only be given by the
Holders of the same proportion in Liquidation Amount of the Trust Securities as
would be entitled to direct the Property Trustee under the terms of the Trust
Securities in respect of such remedy, right or action), (ii) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in acting in accordance
with such instructions; and

                  (k)      except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement.

                  No provision of this Trust Agreement shall be deemed to impose
any duty or obligation on any Issuer 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 such Person 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 any Issuer Trustee shall be construed
to be a duty.

         SECTION 8.4       Not Responsible for Recitals or Issuance of
Securities.

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

                  The Property Trustee may conclusively assume that any funds
held by it hereunder are legally available unless an officer of the Property
Trustee assigned to its Corporate Trust Administration department shall have
received written notice from the Depositor, any Holder or any other Issuer
Trustee that such funds are not legally available.

         SECTION 8.5       May Hold Securities.

                  Any Issuer Trustee or any other agent of any Issuer Trustee or
the Issuer Trust, in its individual or any other capacity, may become the owner
or pledgee of Trust Securities and, subject to Sections 8.8 and 8.13, and except
as provided in the definition of the term "Outstanding" in Article I, may
otherwise deal with the Issuer Trust with the same rights it would have if it
were not an Issuer Trustee or such other agent.

         SECTION 8.6       Compensation; Indemnity; Fees.

                  The Depositor agrees:

                  (a)      to pay to the Issuer Trustees from time to time such
reasonable compensation for all services rendered by them hereunder as may be
agreed by the Depositor and the Issuer Trustees from time to time (which
compensation shall not be

                                      -42-




limited by any provision of law in regard to the compensation of a trustee of an
express trust);

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

                  (c)      to the fullest extent permitted by applicable law, to
indemnify and hold harmless (i) each Issuer Trustee, (ii) any Affiliate of any
Issuer Trustee, (iii) any officer, director, shareholder, employee,
representative or agent of any Issuer Trustee, and (iv) any employee or agent of
the Issuer Trust (referred to herein as an "Indemnified Person") from and
against any loss, damage, liability, tax, penalty, expense, action, suit or
claim of any kind or nature whatsoever incurred by such Indemnified Person by
reason of the creation, operation or termination of the Issuer Trust or any act
or omission performed or omitted by such Indemnified Person on behalf of the
Issuer Trust, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by such Indemnified
Person by reason of negligence, bad faith or willful misconduct with respect to
such acts or omissions.

                  The provisions of this Section 8.6 shall survive the
termination of this Trust Agreement and the removal or resignation of any Issuer
Trustee.

                  No Issuer Trustee may claim any Lien on any Trust Property as
a result of any amount due pursuant to this Section 8.6.

         SECTION 8.7       Corporate Property Trustee Required; Eligibility of
Issuer Trustees.

                  (a)      There shall at all times be a Property Trustee
hereunder with respect to the Trust Securities. The Property Trustee shall be a
Person that is a national or state chartered bank and eligible pursuant to the
Trust Indenture Act to act as such and that has a combined capital and surplus
of at least $50,000,000. If any such Person publishes reports of condition at
least annually, pursuant to law or to the requirements of its supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Property
Trustee with respect to the Trust Securities shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article. At the
time of appointment, the Property Trustee must have securities rated in one of
the three highest rating categories by a nationally recognized statistical
rating organization.


                                      -43-




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

                  (c)      There shall at all times be a Delaware Trustee with
respect to the Trust Securities. The Delaware Trustee shall either be (i) a
natural person who is at least 21 years of age and a resident of the State of
Delaware, or (ii) a legal entity with its principal place of business in the
State of Delaware and that otherwise meets the requirements of applicable
Delaware law and that shall act through one or more persons authorized to bind
such entity.

         SECTION 8.8       Conflicting Interests.

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

                  (b)      The Guarantee Agreement and the Indenture shall be
deemed to be specifically described in this Trust Agreement for the purposes of
clause (i) of the first proviso contained in Section 310(b) of the Trust
Indenture Act.

         SECTION 8.9       Co-Trustees and Separate Trustee.

                  Unless a Trust Event of Default shall have occurred and be
continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any part
of the Trust Property may at the time be located, the Holders of Common
Securities and the Administrative Trustees, by agreed action of the majority of
such Trustees, shall have power to appoint, and upon the written request of the
Administrative Trustees, the Depositor shall for such purpose join with the
Administrative Trustees in the execution, delivery, and performance of all
instruments and agreements necessary or proper to appoint, one or more Persons
approved by the Property Trustee either to act as co-trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to the extent
required by law to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or Persons in the capacity aforesaid, any property, title,
right or power deemed necessary or desirable, subject to the other provisions of
this Section. Any co-trustee or separate trustee appointed pursuant to this
Section shall either be (i) a natural person who is at least 21 years of age and
a resident of the United States, or (ii) a legal entity with its principal place
of business in the United States that shall act through one or more persons
authorized to bind such entity. In case a Trust Event of Default shall have
occurred and be continuing, the Property Trustee alone shall have the power to
make such appointment.

                  Should any written instrument from the Depositor be required
by any co-trustee or separate trustee so appointed for more fully confirming to
such co-trustee or separate

                                      -44-




trustee such property, title, right, or power, any and all such instruments
shall, on request, be executed, acknowledged and delivered by the Depositor.

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

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

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

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

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

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

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

         SECTION 8.10      Resignation and Removal; Appointment of Successor.

                  No resignation or removal of any Issuer Trustee (the "Relevant
Trustee") and no appointment of a successor Issuer Trustee pursuant to this
Article shall become effective


                                      -45-




until the acceptance of appointment by the successor Issuer Trustee in
accordance with the applicable requirements of Section 8.11.

                  Subject to the immediately preceding paragraph, the Relevant
Trustee may resign at any time by giving written notice thereof to the Holders.
If the instrument of acceptance by the successor Trustee required by Section
8.11 shall not have been delivered to the Relevant Trustee within 30 days after
the giving of such notice of resignation, the Relevant Trustee may petition, at
the expense of the Trust, any court of competent jurisdiction for the
appointment of a successor Relevant Trustee.

                  Unless a Debenture Default shall have occurred and be
continuing, any Issuer Trustee may be removed at any time by Act of the Holders
of Common Securities. The Property Trustee or the Delaware Trustee, or both of
them, may be removed by Act of the Holders of a Majority in Liquidation Amount
of the Capital Securities, delivered to the Relevant Trustee (in its individual
capacity and on behalf of the Trust) for cause or if a Debenture Default shall
have occurred and be continuing. An Administrative Trustee may be removed by the
Holders of Common Securities at any time. In no event will the Holders of the
Capital Securities have a right to vote to appoint, remove or replace the
Administrative Trustees.

                  If any Issuer Trustee shall resign, be removed or become
incapable of acting as Issuer Trustee, or if a vacancy shall occur in the office
of any Issuer Trustee for any reason, at a time when no Debenture Default shall
have occurred and be continuing, the Holders of Common Securities, by Act of the
Holders of Common Securities, shall promptly appoint a successor Issuer Trustee
or Issuer Trustees, and the retiring Issuer Trustee shall comply with the
applicable requirements of Section 8.11. If the Property Trustee or the Delaware
Trustee shall resign, be removed or become incapable of continuing to act as the
Property Trustee or the Delaware Trustee, as the case may be, at a time when a
Debenture Default shall have occurred and be continuing, the Holders of Capital
Securities, by Act of the Holders of a Majority in Liquidation Amount of the
Capital Securities then Outstanding, shall promptly appoint a successor Relevant
Trustee or Trustees, and such successor Trustee shall comply with the applicable
requirements of Section 8.11. If an Administrative Trustee shall resign, be
removed or become incapable of acting as Administrative Trustee, at a time when
a Debenture Default shall have occurred and be continuing, the Holders of Common
Securities by Act of the Holders of Common Securities shall promptly appoint a
successor Administrative Trustee or Administrative Trustees and such successor
Administrative Trustee or Trustees shall comply with the applicable requirements
of Section 8.11. If no successor Relevant Trustee shall have been so appointed
by the Holders of Common Securities or the Holders of Capital Securities and
accepted appointment in the manner required by Section 8.11, any Holder who has
been a Holder of Trust Securities for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Relevant Trustee.

                  The Property Trustee shall give notice of each resignation and
each removal of an Issuer Trustee and each appointment of a successor Issuer
Trustee to all Holders in the


                                      -46-




manner provided in Section 10.8 and shall give notice to the Depositor. Each
notice shall include the name of the successor Relevant Trustee and the address
of its Corporate Trust Office if it is the Property Trustee.

                  Notwithstanding the foregoing or any other provision of this
Trust Agreement, in the event any Administrative Trustee or a Delaware Trustee
who is a natural person dies or becomes, in the opinion of the Depositor,
incompetent or incapacitated, the vacancy created by such death, incompetence or
incapacity may be filled by (a) the unanimous act of the remaining
Administrative Trustees if there are at least two of them or (b) otherwise by
the Depositor (with the successor in each case being a Person who satisfies the
eligibility requirement for Administrative Trustees or Delaware Trustee, as the
case may be, set forth in Section 8.7).

         SECTION 8.11      Acceptance of Appointment by Successor.

                  In case of the appointment hereunder of a successor Issuer
Trustee such successor Issuer Trustee so appointed shall execute, acknowledge
and deliver to the Issuer Trust and to the retiring Issuer Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Issuer Trustee shall become effective and such successor Issuer
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Issuer Trustee; but,
on the request of the Depositor or the successor Issuer Trustee, such retiring
Issuer Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Issuer Trustee all the rights, powers
and trusts of the retiring Issuer Trustee and if the Property Trustee is the
resigning Issuer Trustee shall duly assign, transfer and deliver to the
successor Issuer Trustee all property and money held by such retiring Property
Trustee hereunder. Notwithstanding the foregoing, any successor Delaware Trustee
shall file an amendment to the Certificate of Trust with the Secretary of State
of the state of Delaware.

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

                                      -47-




such successor Relevant Trustee all Trust Property, all proceeds thereof and
money held by such retiring Relevant Trustee hereunder with respect to the Trust
Securities and the Issuer Trust.

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

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

         SECTION 8.12      Merger, Conversion, Consolidation or Succession to
Business.

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

         SECTION 8.13      Preferential Collection of Claims Against Depositor
or Issuer Trust.

                  If and when the Property Trustee shall be or become a creditor
of the Depositor or the Issuer Trust (or any other obligor upon the Capital
Securities), the Property Trustee shall be subject to the provisions of the
Trust Indenture Act regarding the collection of claims against the Depositor,
the Guarantor or the Issuer Trust (or any such other obligor).

         SECTION 8.14      Property Trustee May File Proofs of Claim.

                  In case of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Issuer Trust or any other obligor
upon the Trust Securities or the property of the Issuer Trust or of such other
obligor or their creditors, the Property Trustee (irrespective of whether any
Distributions on the Trust Securities shall then be due and payable and
irrespective of whether the Property Trustee shall have made any demand on the
Issuer Trust for the payment of any past due Distributions) shall be entitled
and empowered, to the fullest extent permitted by law, by intervention in such
proceeding or otherwise:

                  (a)      to file and prove a claim for the whole amount of
any Distributions owing and unpaid in respect of the Trust Securities and to
file such other papers or documents as may be necessary or advisable in order to
have the claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and


                                      -48-




advances of the Property Trustee, its agents and counsel) and of the Holders
allowed in such judicial proceeding, and

                  (b)      to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.

                  Nothing herein contained shall be deemed to authorize the
Property Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or compensation
affecting the Trust Securities or the rights of any Holder thereof or to
authorize the Property Trustee to vote in respect of the claim of any Holder in
any such proceeding.

         SECTION 8.15      Reports by Property Trustee.

                  (a)      Not later than February 28 of each year (commencing
in 20__), the Property Trustee shall transmit to all Holders in accordance with
Section 10.8, and to the Depositor, a brief report dated as of the immediately
preceding December 31 with respect to:

                           (i)      its eligibility under Section 8.7 or, in
                  lieu thereof, if to the best of its knowledge it has continued
                  to be eligible under said Section, a written statement to such
                  effect;

                           (ii)     a statement that the Property Trustee has
                  complied with all of its obligations under this Trust
                  Agreement during the twelve-month period (or, in the case of
                  the initial report, the period since the Closing Date) ending
                  with such December 31 or, if the Property Trustee has not
                  complied in any material respect with such obligations, a
                  description of such noncompliance; and

                           (iii)    any change in the property and funds in its
                  possession as Property Trustee since the date of its last
                  report and any action taken by the Property Trustee in the
                  performance of its duties hereunder which it has not
                  previously reported and which in its opinion materially
                  affects the Trust Securities.

                  (b)      In addition the Property Trustee shall transmit to
Holders such reports concerning the Property Trustee and its actions under this
Trust Agreement as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant thereto.


                                      -49-




                  (c)      A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with the Commission
and with the Depositor.

         SECTION 8.16      Reports to the Property Trustee.

                  Each of the Depositor, the Guarantor and the Administrative
Trustees shall provide to the Property Trustee such documents, reports and
information as required by Section 314 of the Trust Indenture Act (if any) and
the compliance certificate required by Section 314(a) of the Trust Indenture Act
in the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act. The Depositor, the Guarantor and the Administrative Trustees
shall annually file with the Property Trustee a certificate specifying whether
such Person is in compliance with all of the terms and covenants applicable to
such Person hereunder.

         SECTION 8.17      Evidence of Compliance with Conditions Precedent.

                  Each of the Depositor, the Guarantor and the Administrative
Trustees shall provide to the Property Trustee such evidence of compliance with
any conditions precedent, if any, provided for in this Trust Agreement that
relate to any of the matters set forth in Section 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) of the Trust Indenture Act shall be given in the form of an
Officers' Certificate.

         SECTION 8.18      Number of Issuer Trustees.

                  (a)      The number of Issuer Trustees initially shall be six,
provided that the Property Trustee and the Delaware Trustee may be the same
Person, in which case the number of Issuer Trustees may be less than six.

                  (b)      If an Issuer Trustee ceases to hold office for any
reason, a vacancy shall occur. The vacancy shall be filled with an Issuer
Trustee appointed in accordance with Section 8.10.

                  (c)      The death, resignation, retirement, removal,
bankruptcy, incompetence or incapacity to perform the duties of an Issuer
Trustee shall not operate to annul, dissolve or terminate the Issuer Trust.

         SECTION 8.19      Delegation of Power.

                  (a)      Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 2.7(a), including any registration statement or
amendment thereto filed with the Commission, or making any other governmental
filing; and

                  (b)      The Administrative Trustees shall have power to
delegate from time to time to such of their number or to the Depositor the doing
of such things and the

                                      -50-




execution of such instruments either in the name of the Issuer Trust or the
names of the Administrative Trustees or otherwise as the Administrative Trustees
may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of this Trust Agreement.

         SECTION 8.20      Appointment of Administrative Trustees.

                  (a)      The Administrative Trustees shall initially be Jorge
A. Junquera, an individual, and Richard Barrios, an individual, and their
successors shall be appointed by the Holders of a Majority in Liquidation Amount
of the Common Securities and may resign or be removed by the Holders of a
Majority in Liquidation Amount of the Common Securities at any time. Upon any
resignation or removal, the Depositor shall promptly appoint a successor
Administrative Trustee. Each Administrative Trustee shall sign an agreement
agreeing to comply with the terms of this Trust Agreement. If at any time there
is no Administrative Trustee, the Property Trustee or any Holder who has been a
Holder of Trust Securities for at least six months may petition any court of
competent jurisdiction for the appointment of one or more Administrative
Trustees.

                  (b)      Whenever a vacancy in the number of Administrative
Trustees shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with this Section 8.20, the Administrative
Trustees in office, regardless of their number (and not withstanding any other
provision of this Agreement), shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties imposed upon the
Administrative Trustees by this Trust Agreement.

                  (c)      Notwithstanding the foregoing or any other provision
of this Trust Agreement, if any Administrative Trustee who is a natural person
dies or becomes, in the opinion of the Depositor, incompetent or incapacitated,
the vacancy created by such death, incompetence or incapacity may be filled by
the acts of the remaining Administrative Trustee, if there were at least two of
them prior to such vacancy, and by the Depositor, if there were not two such
Administrative Trustees immediately prior to such vacancy (with the successor
being a Person who satisfies the eligibility requirement for Administrative
Trustees set forth in Section 8.7).

         SECTION 8.21      Outside Business.

                  The Depositor and any Issuer Trustee may engage in or possess
an interest in other business ventures of any nature or description,
independently or with others, similar or dissimilar to the business of the
Issuer Trust, and the Issuer Trust and the Holders of Capital Securities shall
have no rights by virtue of this Trust Agreement in and to such independent
ventures or the income or profits derived therefrom, and the pursuit of any such
venture, even if competitive with the business of the Issuer Trust, shall not be
deemed wrongful or improper. Neither the Depositor, nor any Issuer Trustee,
shall be obligated to present any particular investment or other opportunity to
the Issuer Trust even if such opportunity is of a character that, if presented
to the Issuer Trust, could be taken by the Issuer Trust, and the Depositor or
any Issuer Trustee shall have the right to

                                      -51-




take for its own account (individually or as a partner or fiduciary) or to
recommend to others any such particular investment or other opportunity. Any
Issuer Trustee may engage or be interested in any financial or other transaction
with the Depositor or any Affiliate of the Depositor, or may act as depositary
for, trustee or agent for, or act on any committee or body of holders of,
securities or other obligations of the Depositor or its Affiliates.

                                   ARTICLE IX

                       TERMINATION, LIQUIDATION AND MERGER

         SECTION 9.1       Termination Upon Expiration Date.

                  Unless earlier terminated, the Issuer Trust shall
automatically terminate on _____, 20__ (the "Expiration Date"), following the
distribution of the Trust Property in accordance with Section 9.4.

         SECTION 9.2       Early Termination.

                  The first to occur of any of the following events is an "Early
Termination Event":

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

                  (b)      the written direction to the Property Trustee from
all of the Holders of the Common Securities, as well as the delivery of an
Opinion of Counsel that Holders of Capital Securities will not recognize income
or loss for United States Federal income tax purposes as a result, at any time
to terminate the Issuer Trust and to distribute the Debentures to Holders in
exchange for the Capital Securities (which direction is optional and wholly
within the discretion of the Holders of the Common Securities);

                  (c)      the redemption of all of the Capital Securities in
connection with the contemporaneous redemption or maturity of all the
Debentures; and

                  (d)      the entry of an order for dissolution of the Issuer
Trust by a court of competent jurisdiction.

         SECTION 9.3       Termination.

                  The respective obligations and responsibilities of the Issuer
Trustees and the Issuer Trust created and continued hereby shall terminate upon
the latest to occur of the following: (a) the distribution by the Property
Trustee to Holders of all amounts required to be distributed hereunder upon the
liquidation of the Issuer Trust pursuant to Section 9.4, or upon the redemption
of all of the Trust Securities pursuant to Section 4.2; (b) the payment of any
expenses owed by the Issuer Trust; and (c) the discharge of all administrative
duties of the Administrative Trustees, including the performance of any tax
reporting obligations with respect to the Issuer Trust or the Holders.


                                      -52-




         SECTION 9.4       Liquidation.

                  (a)      If an Early Termination Event specified in clause
(a), (b) or (d) of Section 9.2 occurs or upon the Expiration Date, the Issuer
Trust shall be liquidated by the Issuer Trustees as expeditiously as the Issuer
Trustees determine to be possible by distributing, after satisfaction of
liabilities to creditors of the Issuer Trust as provided by applicable law, to
each Holder a Like Amount of Debentures, subject to Section 9.4(d). Notice of
liquidation shall be given by the Property Trustee by first-class mail, postage
prepaid mailed not less than 30 nor more than 60 days prior to the Liquidation
Date to each Holder of Trust Securities at such Holder's address appearing in
the Securities Register. All such notices of liquidation shall:

                           (i)      state the Liquidation Date;

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

                           (iii)    provide such information with respect to the
                  procedures by which Holders may exchange Trust Securities
                  Certificates for Debentures, or if Section 9.4(d) applies
                  receive a Liquidation Distribution, as Administrative Trustees
                  or the Property Trustee shall deem appropriate.

                  (b)      Except where Section 9.2(c) or 9.4(d) applies, in
order to effect the liquidation of the Issuer Trust and distribution of the
Debentures to Holders, the Property Trustee, either itself acting as exchange
agent or through the appointment of a separate exchange agent, shall establish a
record date for such distribution (which shall be not more than 30 days prior to
the Liquidation Date) and, establish such procedures as it shall deem
appropriate to effect the distribution of Debentures in exchange for the
Outstanding Trust Securities Certificates.

                  (c)      Except where Section 9.2(c) or 9.4(d) applies, after
the Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) certificates representing a Like Amount of Debentures will be
issued to Holders of Trust Securities Certificates, upon surrender of such
Certificates to the exchange agent for exchange, (iii) any Trust Securities
Certificates not so surrendered for exchange will be deemed to represent a Like
Amount of Debentures bearing accrued and unpaid interest in an amount equal to
the accumulated and unpaid Distributions on such Trust Securities Certificates
until such certificates are so surrendered (and until such certificates are so
surrendered, no payments of interest or principal will be made to Holders of
Trust Securities Certificates with respect to such Debentures) and (iv) all
rights of Holders holding Trust Securities will cease, except the right of such
Holders to receive Debentures upon surrender of Trust Securities Certificates.

                  (d)      If, notwithstanding the other provisions of this
Section 9.4, whether because of an order for dissolution entered by a court of
competent jurisdiction or

                                      -53-




otherwise, distribution of the Debentures in the manner provided herein is
determined by the Property Trustee not to be practical, or if an Early
Termination Event specified in Section 9.2(c) has occurred and the entire
Redemption Price properly paid, the Trust Property shall be liquidated, and the
Issuer Trust shall be dissolved, wound-up or terminated, by the Property Trustee
in such manner as the Property Trustee determines. In such event, on the date of
the dissolution, winding-up or other termination of the Issuer Trust, Holders
will be entitled to receive out of the assets of the Issuer Trust available for
distribution to Holders, after satisfaction of liabilities to creditors of the
Issuer Trust as provided by applicable law, an amount equal to the Liquidation
Amount per Trust Security plus accumulated and unpaid Distributions thereon to
the date of payment (such amount being the "Liquidation Distribution"). If, upon
any such dissolution, winding up or termination, the Liquidation Distribution
can be paid only in part because the Issuer Trust has insufficient assets
available to pay in full the aggregate Liquidation Distribution, then, subject
to the next succeeding sentence, the amounts payable by the Issuer Trust on the
Trust Securities shall be paid on a pro rata basis (based upon Liquidation
Amounts). The Holders of the Common Securities will be entitled to receive
Liquidation Distributions upon any such dissolution, winding-up or termination
pro rata (determined as aforesaid) with Holders of Capital Securities, except
that, if a Debenture Default has occurred and is continuing, the Capital
Securities shall have a priority over the Common Securities as provided in
Section 4.3.

         SECTION 9.5       Mergers, Consolidations, Amalgamations or
Replacements of Issuer Trust.

                  The Issuer Trust may not merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets substantially as an entirety to any corporation or other body, except
pursuant to this Section 9.5. At the request of the Holders of the Common
Securities, with the consent of the Administrative Trustees (the consent of the
Property Trustee, the Delaware Trustee and the Holders of the Capital Securities
not being required), the Issuer Trust may merge with or into, consolidate,
amalgamate, or be replaced by or convey, transfer or lease its properties and
assets substantially as an entirety to a trust organized as such under the laws
of the United States, any State or the District of Columbia; provided that if
the Issuer Trust is not the surviving entity (i) such successor entity either
(a) expressly assumes all of the obligations of the Issuer Trust with respect to
the Capital Securities, or (b) substitutes for the Capital Securities other
securities having substantially the same terms as the Capital Securities (the
"Successor Securities") so long as the Successor Securities have the same
priority as the Capital Securities with respect to Distributions and payments
upon liquidation, redemption and otherwise, (ii) a trustee of such successor
entity possessing the same powers and duties as the Property Trustee is
appointed to hold the Debentures, (iii) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
rating of the Capital Securities (including any Successor Securities) to be
downgraded or withdrawn by any nationally recognized statistical rating
organization which assigns ratings to the Capital Securities, (iv) the Successor
Securities are listed, or any Successor Securities will be listed upon notice of
issuance, on the national securities exchange, the Nasdaq National Market or on
such other exchange, interdealer quotation system or self regulatory
organization as the Capital Securities are then listed, if any (it being
understood that the Depositor has no current intention of listing the Capital
Securities on any national stock exchange, the Nasdaq National Market or on any
other exchange,

                                      -54-




interdealer quotation system or self-regulatory organization), (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Capital Securities (including any Successor Securities) in any material respect,
(vi) after giving effect to the transaction, no Debenture Default and no event
which, after the giving of notice or the lapse of time, or both, would become a
Debenture Default, has occurred and is continuing under the Indenture, (vii)
such successor entity has a purpose substantially identical to that of the
Issuer Trust, (viii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Depositor has received an
opinion from independent counsel to the Issuer Trust to the effect that (a) such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not adversely affect the rights, preferences and privileges of the Holders
of the Capital Securities (including any Successor Securities) in any material
respect, (b) the Issuer Trust continues to be, and the successor entity shall
be, a grantor trust for United States Federal income tax purposes and (c)
following such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease, neither the Issuer Trust nor such successor entity will be
required to register as an "investment company" under the Investment Company
Act, and (ix) the Depositor or its permitted successor or permitted transferee
owns all of the Common Securities of such successor entity and guarantees the
obligations of such successor entity under the Successor Securities at least to
the extent provided by the Guarantee Agreement. Notwithstanding the foregoing,
the Issuer Trust shall not, except with the consent of Holders of all of the
Capital Securities, consolidate, amalgamate, merge with or into, or be replaced
by or convey, transfer or lease its properties and assets substantially as an
entirety to any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause the
Issuer Trust or the successor entity to be taxable as a corporation or
classified as other than a grantor trust for United States Federal income tax
purposes or the Issuer Trust to be required to be registered as an "investment
company" under the Investment Company Act.

                                   ARTICLE X

                            MISCELLANEOUS PROVISIONS

         SECTION 10.1      Limitation of Rights of Holders.

                  Except as set forth in Section 9.2, the death or incapacity
of any person having an interest, beneficial or otherwise, in Trust Securities
shall not operate to terminate this Trust Agreement, nor entitle the legal
representatives or heirs of such person or any Holder for such person, to claim
an accounting, take any action or bring any proceeding in any court for a
partition or winding up of the arrangements contemplated hereby, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.


                                      -55-




         SECTION 10.2      Amendment.

                  (a)      This Trust Agreement may be amended from time to time
by the Property Trustee, the Administrative Trustees, the Guarantor and the
Holders of all of the Common Securities, without the consent of any Holder of
the Capital Securities, (i) to cure any ambiguity, correct or supplement any
provision herein that may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising under
this Trust Agreement, which shall not be inconsistent with the other provisions
of this Trust Agreement, or (ii) to modify, eliminate or add to any provisions
of this Trust Agreement to such extent as shall be necessary to ensure that the
Issuer Trust will not be taxable as a corporation or classified as other than a
grantor trust for United States Federal income tax purposes at all times that
any Trust Securities are Outstanding or to ensure that the Issuer Trust will not
be required to register as an "investment company" under the Investment Company
Act, provided, however, that in the case of either clause (i) or clause (ii)
such action shall not adversely affect in any material respect the interests of
any Holder, and any such amendment of this Trust Agreement shall become
effective when notice thereof is given to the Holders.

                  (b)      Except as provided in Section 10.2(c), any provision
of this Trust Agreement may be amended by the Issuer Trustees, the Guarantor and
the Holders of all of the Common Securities and with (i) the consent of Holders
of a Majority in Liquidation Amount of the Trust Securities, and (ii) receipt by
the Issuer Trustees of an Opinion of Counsel to the effect that such amendment
or the exercise of any power granted to the Issuer Trustees in accordance with
such amendment will not cause the Issuer Trust to be taxable as a corporation or
as other than a grantor trust for United States Federal income tax purposes or
affect the Issuer Trust's exemption from status as an "investment company" under
the Investment Company Act.

                  (c)      In addition to and notwithstanding any other
provision in this Trust Agreement, without the consent of each affected Holder
(such consent being obtained in accordance with Section 6.3 or 6.6), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities, (ii) change the Redemption Date,
Redemption Price, the Liquidation Distribution or events that would cause a
redemption of Trust Securities or liquidation, dissolution or termination of the
Issuer Trust or (iii) restrict the right of a Holder to institute suit for the
enforcement of any such payment on or after its due date, including the right to
bring a Direct Action; and notwithstanding any other provision herein, without
the unanimous consent of the Holders (such consent being obtained in accordance
with Section 6.3 or 6.6), this Section 10.2(c) may not be amended.

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


                                      -56-




                  (e)      Notwithstanding anything in this Trust Agreement to
the contrary, without the consent of the Depositor, the Guarantor and the
Administrative Trustees, this Trust Agreement may not be amended in a manner
that imposes any additional obligation on the Depositor, the Guarantor or the
Administrative Trustees.

                  (f)      In the event that any amendment to this Trust
Agreement is made, the Administrative Trustees or the Property Trustee shall
promptly provide to the Depositor and the Guarantor a copy of such amendment.

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

         SECTION 10.3      Separability.

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

         SECTION 10.4      Governing Law.

                  THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF
THE HOLDERS, THE ISSUER TRUST, THE DEPOSITOR, THE GUARANTOR AND THE ISSUER
TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE
APPLICABLE TO AGREEMENTS MADE AND WHOLLY TO BE PERFORMED IN SUCH STATE, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES.

         SECTION 10.5      Payments Due on Non-Business Day.

                  If the date fixed for any payment on any Trust Security shall
be a day that is not a Business Day, then such payment need not be made on such
date but may be made on the next succeeding day that is a Business Day, with the
same force and effect as though made on the date fixed for such payment, and no
Distributions shall accumulate on such unpaid amount for the period after such
date.

         SECTION 10.6      Successors.

                  This Trust Agreement shall be binding upon and shall inure to
the benefit of any successor to the Depositor, the Guarantor, the Issuer Trust
and any Issuer Trustee, including any successor by operation of law. Except in
connection with a consolidation, merger or sale involving the Depositor that is
permitted under Article Eight of the


                                      -57-




Indenture and pursuant to which the assignee agrees in writing to perform the
Depositor's obligations hereunder, the Depositor shall not assign its
obligations hereunder.

         SECTION 10.7      Headings.

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

         SECTION 10.8      Reports, Notices and Demands.

                  Any report, notice, demand or other communication that by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Holder, the Depositor or the Guarantor may be given or served in
writing by deposit thereof, first-class postage prepaid, in the United States
mail, hand delivery or facsimile transmission, in each case, addressed, (a) in
the case of a Holder of Capital Securities, to such Holder as such Holder's name
and address may appear on the Securities Register; and (b) in the case of the
Holder of the Common Securities, the Depositor or the Guarantor, to Popular
North America, Inc., 209 Munoz Rivera Avenue, San Juan, Puerto Rico 00918,
Attention: Secretary, facsimile no.: _________, or to such other address as may
be specified in a written notice by the Holder of the Common Securities or the
Depositor, as the case may be, to the Property Trustee. Such notice, demand or
other communication to or upon a Holder shall be deemed to have been
sufficiently given or made, for all purposes, upon hand delivery, mailing or
transmission. Such notice, demand or other communication to or upon the
Depositor shall be deemed to have been sufficiently given or made only upon
actual receipt of the writing by the Depositor.

                  Any notice, demand or other communication that by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon the Property Trustee, the Delaware Trustee, the Administrative
Trustees or the Issuer Trust shall be given in writing addressed to such Person
as follows: (a) with respect to the Property Trustee to The Bank of New York
Mellon [address to come]; (b) with respect to the Delaware Trustee, to BNY
Mellon Trust of Delaware [address to come];(c) with respect to the
Administrative Trustees, to them at the address above for notices to the
Depositor, marked "Attention: Administrative Trustees of Popular North America
Capital Trust __"; and (d) with respect to the Issuer Trust, to its principal
office specified in Section 2.1, with a copy to the Property Trustee. Such
notice, demand or other communication to or upon the Issuer Trust, the Property
Trustee or the Administrative Trustees shall be deemed to have been sufficiently
given or made only upon actual receipt of the writing by the Issuer Trust, the
Property Trustee or such Administrative Trustee.

         SECTION 10.9      Agreement Not to Petition.

                  Each of the Issuer Trustees, the Depositor and the Guarantor
agrees for the benefit of the Holders that, until at least one year and one day
after the Issuer Trust has been

                                      -58-




terminated in accordance with Article IX, they shall not file, or join in the
filing of, a petition against the Issuer Trust under Bankruptcy Laws or
otherwise join in the commencement of any proceeding against the Issuer Trust
under any Bankruptcy Law. If any action is taken in violation of this Section
10.9, the Property Trustee agrees, for the benefit of Holders, that at the
expense of the Depositor and the Guarantor, it shall file an answer with the
bankruptcy court or otherwise properly contest the filing of such petition
against the Issuer Trust or the commencement of such action and raise the
defense that the Depositor and the Guarantor have agreed in writing not to take
such action and should be stopped and precluded therefrom and such other
defenses, if any, as counsel for the Issuer Trustees or the Issuer Trust may
assert.

         SECTION 10.10     Trust Indenture Act; Conflict with Trust Indenture
Act.

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

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

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

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

         SECTION 10.11     Acceptance of Terms of Trust Agreement, Guarantee
Agreement and Indenture.

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

                                      -59-






                [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]


                                      -60-






         IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Trust Agreement.

                        POPULAR NORTH AMERICA, INC.,
                               as Depositor


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


                        POPULAR, INC.,
                               as Guarantor

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


                        THE BANK OF NEW YORK MELLON,
                               as Property Trustee

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

                        BNY MELLON TRUST OF DELAWARE,
                                as Delaware Trustee

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


                        ----------------------------------------------------
                        Name:  Jorge A. Junquera, an individual,
                               as Administrative Trustee

                        ----------------------------------------------------
                        Name:  Richard Barrios, an individual,
                               as Administrative Trustee



                                      -61-



                                                                       EXHIBIT A

                              CERTIFICATE OF TRUST

                                       OF

                      POPULAR NORTH AMERICA CAPITAL TRUST ___

         THIS Certificate of Trust of Popular North America Capital Trust ___
(the "Trust") is being duly executed and filed by the undersigned, as trustees,
to form a statutory trust under the Delaware Statutory Trust Act (12 Del. C.
Section 3801 et seq.) (the "Act").

         1.       Name. The name of the statutory trust formed hereby is Popular
North America Capital Trust ___.

         2.       Delaware Trustee. The name and business address of the trustee
of the Trust in the State of Delaware is [to come].

         3.       Effective Date. This Certificate of Trust shall be effective
upon filing.

         IN WITNESS WHEREOF, the undersigned have duly executed this Certificate
in accordance with Section 3811(a) of the Act.

                                 BNY MELLON TRUST OF DELAWARE,
                                 as Trustee

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


                                 -----------------------------------, as Trustee
                                 Name:


                                 -----------------------------------, as Trustee
                                 Name:



                                      A-1



                                                                       EXHIBIT B

                      [FORM OF LETTER OF REPRESENTATIONS]





                                       B-1



                                                                       EXHIBIT C

                     [FORM OF COMMON SECURITIES CERTIFICATE]

             TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW THIS
           CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE DEPOSITOR OR
           AN AFFILIATE OF THE DEPOSITOR IN COMPLIANCE WITH APPLICABLE
              LAW AND SECTION 5.11 OF THE TRUST AGREEMENT AND ONLY
                  IN CONNECTION WITH A SIMULTANEOUS DELEGATION
                     AND ASSIGNMENT OF THE EXPENSE AGREEMENT
                               REFERRED TO THEREIN

Certificate Number                                 Number of Common Securities
         CI-

                    Certificate Evidencing Common Securities

                                       of

                      Popular North America Capital Trust __

                            _____% Common Securities
                 (liquidation amount $1,000 per Common Security)

         Popular North America Capital Trust __, a statutory trust formed under
the laws of the State of Delaware (the "Issuer Trust"), hereby certifies that
[NAME OF HOLDER] (the "Holder") is the registered owner of     Common Securities
of the Issuer Trust representing common undivided beneficial interests in the
assets of the Issuer Trust and designated the _____% Common Securities
(liquidation amount $1,000 per Common Security) (the "Common Securities"). To
the fullest extent permitted by applicable law and except in accordance with
Section 5.11 of the Trust Agreement (as defined below) the Common Securities are
not transferable and any attempted transfer hereof other than in accordance
therewith shall be void. The designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Common Securities are set
forth in, and this certificate and the Common Securities represented hereby are
issued and shall in all respects be subject to the terms and provisions of, the
Amended and Restated Trust Agreement of the Issuer Trust, dated as of _____,
20__, as the same may be amended from time to time (the "Trust Agreement"),
among Popular North America, Inc., as Depositor, Popular, Inc., as Guarantor,
The Bank of New York Mellon, as Property Trustee, BNY Mellon Trust of Delaware,
as Delaware Trustee, and the Administrative Trustees named therein, including
the designation of the terms of the Common Securities as set forth therein. The
Issuer Trust will furnish a copy of the Trust Agreement to the Holder without
charge upon written request to the Issuer Trust at its principal place of
business or registered office.


                                      C-1




         Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.

         Terms used but not defined herein have the meanings set forth in the
Trust Agreement.

     IN WITNESS WHEREOF, one of the Administrative  Trustees of the Issuer Trust
has executed this certificate this _____ day of _____, _____.

                                 POPULAR NORTH AMERICA CAPITAL TRUST __


                                 By: -----------------------------_
                                     Name:
                                     Administrative Trustee


                                      C-2



                                                                       EXHIBIT D


                           [FORM OF EXPENSE AGREEMENT]

                    AGREEMENT AS TO EXPENSES AND LIABILITIES

     AGREEMENT AS TO EXPENSES AND LIABILITIES, dated as of __________, 20__,
among Popular North America, Inc., a Delaware corporation (the "Corporation"),
Popular, Inc., a Puerto Rico corporation (the  "Guarantor") and Popular North
America Capital Trust __, a Delaware statutory trust (the "Issuer Trust").

     WHEREAS, the Issuer Trust intends to issue its Common Securities (the
"Common Securities") to and acquire ____% Junior Subordinated Debentures of the
Corporation (the "Debentures") from the Corporation and to issue and sell ____%
Capital Securities (the "Capital Securities") with such powers, preferences and
special rights and restrictions as are set forth in the Amended and Restated
Trust Agreement of the Issuer Trust, dated as of __________, 20__ among the
Corporation, as Depositor, Popular, Inc., as Guarantor, The Bank of New York
Mellon, as Property Trustee, BNY Mellon Trust of Delaware, as Delaware Trustee,
and the Administrative Trustees named therein, as the same may be amended from
time to time (the "Trust Agreement");

     WHEREAS, the Corporation will own all of the Common Securities of the
Trust;

     WHEREAS, terms used but not defined herein have the meanings set forth in
the Trust Agreement;

     NOW, THEREFORE, for good and valid consideration, the receipt and
sufficiency of which are hereby acknowledged:

                                    ARTICLE I

     Section 1.1.    Guarantee by the Corporation and the Guarantor. Subject to
the terms and conditions hereof, the Corporation and the Guarantor hereby
jointly and severally irrevocably and unconditionally guarantee to each person
or entity to whom the Issuer Trust is now or hereafter becomes indebted or
liable (the "Beneficiaries") the full payment, when and as due, of any and all
Obligations (as hereinafter defined) to such Beneficiaries. As used herein,
"Obligations" means (i) all debts and other obligations of the Issuer Trust,
other than obligations of the Issuer Trust to pay to holders of any Trust
Securities the amounts due such holders pursuant to the terms of the Trust
Securities, (ii) all costs and expenses of the Issuer Trust, including without
limitation costs and expenses relating to the organization of the Issuer Trust,
the fees and expenses of the Trustees (as defined in the Trust Agreement) and
the costs and expenses relating to the operation of the Issuer Trust, and (iii)
any and all taxes and costs and expenses with respect thereto to which the
Issuer Trust might become subject, in each case, including without limitation,
any such costs, expenses or liabilities of the Issuer Trust that are required by
applicable law to be satisfied in connection with the termination of the Issuer
Trust. This Agreement is intended to be for the benefit of, and to be
enforceable by, all such Beneficiaries, whether or not such Beneficiaries have
received notice hereof.


                                      D-1




     Section 1.2.   Subordination of Guarantee. The guarantee and other
liabilities and obligations of the Corporation and the Guarantor under this
Agreement shall constitute joint and several unsecured obligations of the
Corporation and the Guarantor, respectively, and shall rank subordinate and
junior in right of payment to all Senior Debt (as defined in the Indenture) of
the Corporation and the Guarantor, as the case may be, to the extent and in the
manner set forth in the Indenture with respect to the Debentures, and the
provisions of Article XII of the Indenture will apply, mutatis mutandis, to the
obligations of the Corporation and the Guarantor hereunder. The obligations of
the Corporation and the Guarantor hereunder do not constitute Senior Debt (as
defined in the Indenture) of the Corporation or the Guarantor.

     Section 1.3.   Term of Agreement. This Agreement shall terminate and be of
no further force and effect upon the dissolution of the Issuer Trust, provided,
however, that this Agreement shall continue to be effective or shall be
reinstated, as the case may be, if at any time any holder of Capital Securities
or any Beneficiary is required to repay any sums paid under the Capital
Securities, under any Obligation, under the Guarantee Agreement dated the date
hereof among the Depositor, the Guarantor and The Bank of New York Mellon, as
guarantee trustee, or under this Agreement for any reason whatsoever. This
Agreement is continuing, irrevocable, unconditional and absolute.

     Section 1.4.   Waiver of Notice. The Corporation and the Guarantor hereby
waive notice of acceptance of this Agreement and of any Obligation to which it
applies or may apply, and the Corporation and the Guarantor hereby waive
presentment, demand for payment, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.

     Section 1.5.   No Impairment. The obligations, covenants, agreements and
duties of the Corporation and the Guarantor under this Agreement shall in no way
be affected or impaired by reason of the happening from time to time of any of
the following:

     (a) the extension of time for the payment by the Issuer Trust of all or any
portion of the Obligations or for the performance of any other obligation under,
arising out of, or in connection with, the Obligations;

     (b) any failure, omission, delay or lack of diligence on the part of the
Beneficiaries to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Beneficiaries with respect to the Obligations or any
action on the part of the Issuer Trust granting indulgence or extension of any
kind; or

     (c) 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 Trust or any of the assets of
the Issuer Trust (other than the liquidation of the Issuer Trust in accordance
with the terms thereof).


                                      D-2




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

     Section 1.6. Enforcement. A Beneficiary may enforce this Agreement directly
against the Corporation or the Guarantor and each of the Corporation and the
Guarantor waives any right or remedy to require that any action be brought
against the Issuer Trust or any other person or entity before proceeding against
the Corporation or the Guarantor.

     Section 1.7. Subrogation. Each of the Corporation and the Guarantor shall
be subrogated to all rights (if any) of the Issuer Trust in respect of any
amounts paid to the Beneficiaries by the Corporation or the Guarantor,
respectively, under this Agreement; provided, however, that each of the
Corporation and the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any rights which
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Agreement, if, at the
time of any such payment, any amounts are due and unpaid under this Agreement.

                                   ARTICLE II

     Section 2.1. Assignment. This Agreement may not be assigned by any party
hereto without the consent of the others, and any purported assignment without
such consent shall be void;

     Section 2.2. Binding Effect. All guarantees and agreements contained in
this Agreement shall bind the successors, assigns, receivers, trustees and
representatives of each of the Corporation and the Guarantor and shall inure to
the benefit of the Beneficiaries.

     Section 2.3. Amendment. So long as there remains any Beneficiary or any
Capital Securities are outstanding, this Agreement shall not be modified or
amended in any manner adverse to such Beneficiary or to the holders of the
Capital Securities without the consent of such Beneficiary or the holders of the
Capital Securities, as the case may be.

     Section 2.4. Notices. Any notice, request or other communication required
or permitted to be given hereunder shall be given in writing by delivering the
same against receipt therefor by facsimile transmission (confirmed by mail),
telex or by registered or certified mail, addressed as follows (and if so given,
shall be deemed given when mailed or upon receipt of an answer-back, if sent by
telex):


                                      D-3




         If given to the Issuer Trust:

                  Popular North America Capital Trust __
                  c/o Popular North America, Inc.
                  209 Munoz Rivera Avenue
                  San Juan, Puerto Rico 00918
                  Facsimile No.: ________
                  Attention: Secretary

         With a copy to:

                  Popular North America, Inc.
                  209 Munoz Rivera Avenue
                  San Juan, Puerto Rico 00918
                  Facsimile No.: ________
                  Attention: Secretary

     Section 2.5.    THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND WHOLLY TO BE PERFORMED IN SUCH STATE.


                                      D-4





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

                           POPULAR NORTH AMERICA, INC.

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


                           POPULAR, INC.

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


                           POPULAR NORTH AMERICA CAPITAL TRUST __

                           By:
                               ---------------------------------------------
                               Name:
                               Administrative Trustee



                                      D-5



                                                                       EXHIBIT E


                    [FORM OF CAPITAL SECURITIES CERTIFICATE]

         [IF THE CAPITAL SECURITIES CERTIFICATE IS TO BE EVIDENCED BY A
BOOK-ENTRY CAPITAL SECURITIES CERTIFICATE, INSERT -- This Capital Securities
Certificate is a Book-Entry Capital Securities Certificate within the meaning of
the Trust Agreement hereinafter referred to and is registered in the name of a
Clearing Agency or a nominee of a Clearing Agency. This Capital Securities
Certificate is exchangeable for Capital Securities Certificates registered in
the name of a person other than the Clearing Agency or its nominee only in the
limited circumstances described in the Trust Agreement and may not be
transferred except as a whole by the Clearing Agency to a nominee of the
Clearing Agency or by a nominee of the Clearing Agency to the Clearing Agency or
another nominee of the Clearing Agency, except in the limited circumstances
described in the Trust Agreement.

         Unless this Capital Security Certificate is presented by an authorized
representative of The Depository Trust Company, a New York Corporation ("DTC"),
to Popular North America Capital Trust __ or its agent for registration of
transfer, exchange or payment, and any Capital Security Certificate issued is
registered in the name of Cede & Co. or 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 A PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.]


                                      E-1




CERTIFICATE NUMBER                                NUMBER OF CAPITAL SECURITIES
         CAI-

                             CUSIP NO. _____________

                    CERTIFICATE EVIDENCING CAPITAL SECURITIES

                                       OF

                      POPULAR NORTH AMERICA CAPITAL TRUST __

                            _____% CAPITAL SECURITIES
                (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)

         Popular North America Capital Trust __, a statutory trust formed under
the laws of the State of Delaware (the "Issuer Trust"), hereby certifies that
___________________ (the "Holder") is the registered owner of _________________
(___) Capital Securities of the Issuer Trust representing preferred undivided
beneficial interests in the assets of the Issuer Trust and designated the
Popular North America Capital Trust __ _____% Capital Securities (liquidation
amount $1,000 per Capital Security) (the "Capital Securities"). The Capital
Securities are transferable on the books and records of the Issuer Trust, in
person or by a duly authorized attorney, upon surrender of this certificate duly
endorsed and in proper form for transfer as provided in Section 5.5 of the Trust
Agreement (as defined below). The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Capital
Securities are set forth in, and this certificate and the Capital Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Issuer Trust,
dated as of _____, 20__, as the same may be amended from time to time (the
"Trust Agreement"), among Popular North America, Inc., as Depositor, Popular,
Inc., as Guarantor, The Bank of New York Mellon, as Property Trustee, BNY Trust
of Delaware, as Delaware Trustee, and the Administrative Trustees named therein,
including the designation of the terms of the Capital Securities as set forth
therein. Reference is also made to the Junior Subordinated Indenture, dated as
of _____, 20__ (the "Indenture"), between Popular, Inc., a Puerto Rico
corporation, Popular North America, Inc., a Delaware corporation, and The Bank
of New York Mellon. The Holder is entitled to the benefits of the Guarantee
Agreement entered into by Popular North America, Inc., Popular, Inc., and The
Bank of New York Mellon, as guarantee trustee, dated as of _____, 20__ (the
"Guarantee Agreement"), to the extent provided therein. The Issuer Trust will
furnish a copy of the Trust Agreement, the Indenture and the Guarantee Agreement
without charge upon written request to the Issuer Trust at its principal place
of business or registered office.

                                      E-2




         Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.


                                      E-3





     IN WITNESS WHEREOF, one of the Administrative  Trustees of the Issuer Trust
has executed this certificate this _____ day of _____, ____.

                                          POPULAR NORTH AMERICA CAPITAL TRUST __


                                           By:
                                              ---------------------------------
                                              Name:
                                              Administrative Trustee


                                      E-4





                                   ASSIGNMENT

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

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


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

-------------------------------------------------------------------------------
                    (Insert address and zip code of assignee)

and irrevocably appoints_______________________________________________________
agent to transfer this Capital Security Certificate on the books of the Issuer
Trust. The agent may substitute another to act for him or her.
Date:  ________________

Signature:
          ---------------------------------------------------------------------
                 (Sign exactly as your name appears on the other side of this

Capital Security Certificate) The signature(s) should be guaranteed by an
eligible guarantor institution (banks, stockbrokers, savings and loan
associations and credit unions with membership in an approved signature
guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.


                                      E-5

EX-4.23

                                                                    EXHIBIT 4.23


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

                               GUARANTEE AGREEMENT

                                  BY AND AMONG

                          POPULAR NORTH AMERICA, INC.,
                                  AS GUARANTOR

                                 POPULAR, INC.,

                             AS ADDITIONAL GUARANTOR

                                       and

                           THE BANK OF NEW YORK MELLON,
                              AS GUARANTEE TRUSTEE

                                   RELATING TO

                      POPULAR NORTH AMERICA CAPITAL TRUST __

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

                         Dated as of ________ __, 20__

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

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




                             CROSS-REFERENCE TABLE(1)



     Section of
Trust Indenture Act                                                                            Section of Guarantee
of 1939, as amended                                                                                  Agreement
-------------------                                                                                  ---------
                                                                                            
310(a)....................................................................................     4.1(a)
310(b)....................................................................................     4.1(c), 2.8
310(c)....................................................................................     Inapplicable
311(a)....................................................................................     2.2(b)
311(b)....................................................................................     2.2(b)
311(c)....................................................................................     Inapplicable
312(a)....................................................................................     2.2(a)
312(b)....................................................................................     2.2(b)
313.......................................................................................     2.3
314(a)....................................................................................     2.4
314(b)....................................................................................     Inapplicable
314(c)....................................................................................     2.5
314(d)....................................................................................     Inapplicable
314(e)....................................................................................     1.1, 2.5, 3.2
314(f)....................................................................................     2.1, 3.2
315(a)....................................................................................     3.1(d)
315(b)....................................................................................     2.7
315(c)....................................................................................     3.1
315(d)....................................................................................     3.1(d)
316(a)....................................................................................     1.1, 2.6, 5.4
316(b)....................................................................................     5.3
316(c)....................................................................................     8.2
317(a)....................................................................................     Inapplicable
317(b)....................................................................................     Inapplicable
318(a)....................................................................................     2.1
318(b)....................................................................................     2.1
318(c)....................................................................................     2.1


--------------
(1)      This Cross-Reference Table does not constitute part of the Guarantee
         Agreement and shall not affect the interpretation of any of its terms
         or provisions.

                                      -i-




                                TABLE OF CONTENTS

                                                                                              
                                    ARTICLE I

                                   DEFINITIONS

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

                                   ARTICLE II

                               TRUST INDENTURE ACT

Section 2.1.   Trust Indenture Act; Application..............................................     4
Section 2.2.   List of Holders...............................................................     4
Section 2.3.   Reports by the Guarantee Trustee..............................................     5
Section 2.4.   Periodic Reports to the Guarantee Trustee.....................................     5
Section 2.5.   Evidence of Compliance with Conditions Precedent..............................     5
Section 2.6.   Events of Default; Waiver.....................................................     5
Section 2.7.   Event of Default; Notice......................................................     5
Section 2.8.   Conflicting Interests.........................................................     6

                                   ARTICLE III

               POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE

Section 3.1.   Powers and Duties of the Guarantee Trustee....................................     6
Section 3.2.   Certain Rights of Guarantee Trustee...........................................     7
Section 3.3.   Compensation; Indemnity; Fees.................................................     8

                                   ARTICLE IV

                                GUARANTEE TRUSTEE

Section 4.1.   Guarantee Trustee; Eligibility................................................     9
Section 4.2.   Appointment, Removal and Resignation of the Guarantee Trustee.................     9

                                    ARTICLE V

                                    GUARANTEE

Section 5.1.   Guarantee.....................................................................    10
Section 5.2.   Waiver of Notice and Demand...................................................    10
Section 5.3.   Obligations Not Affected......................................................    10
Section 5.4.   Rights of Holders.............................................................    11
Section 5.5.   Guarantee of Payment..........................................................    11
Section 5.6.   Subrogation...................................................................    12
Section 5.7.   Independent Obligations.......................................................    12
Section 5.8.   Guarantee Payments and Additional Guarantee Payments Free of
               Puerto Rico Tax...............................................................    12



                                      -ii-




                                                                                              
                                   ARTICLE VI

                           COVENANTS AND SUBORDINATION

Section 6.1.   Subordination.................................................................    13
Section 6.2.   Pari Passu Guarantees.........................................................    13
Section 6.3.   Common Stock..................................................................    13

                                   ARTICLE VII

                                   TERMINATION

Section 7.1.   Termination...................................................................    13

                                  ARTICLE VIII

                                  MISCELLANEOUS

Section 8.1.   Successors and Assigns........................................................    14
Section 8.2.   Amendments....................................................................    14
Section 8.3.   Notices.......................................................................    14
Section 8.4.   Benefit.......................................................................    15
Section 8.5.   Governing Law.................................................................    15
Section 8.6.   Counterparts..................................................................    15



                                     -iii-



         GUARANTEE AGREEMENT, dated as of ________, 20__, by and among
POPULAR NORTH AMERICA, INC., a Delaware corporation (the "Guarantor"), having
its principal office at 209 Munoz Rivera Avenue, San Juan, Puerto Rico 00918,
POPULAR, INC., a Puerto Rico corporation (the "Additional Guarantor", and
together with the Guarantor, the "Guarantors"), having its principal office at
209 Munoz Rivera Avenue, San Juan, Puerto Rico 00918, and THE BANK OF NEW YORK
MELLON, a national banking association, 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 POPULAR NORTH AMERICA CAPITAL TRUST
__, a Delaware statutory trust (the "Issuer Trust").

                           RECITALS OF THE CORPORATION

         WHEREAS, pursuant to an Amended and Restated Trust Agreement, dated as
of ________, 20__ (the "Trust Agreement"), among Popular North America,
Inc., as Depositor, Popular, Inc., as Guarantor, the Property Trustee, the
Delaware Trustee and the Administrative Trustees named therein, the Issuer Trust
is issuing $__________ aggregate Liquidation Amount (as defined in the Trust
Agreement) of its ____% Capital Securities (liquidation amount $1,000 per
Capital Security) (the "Capital Securities"), representing preferred undivided
beneficial interests in the assets of the Issuer Trust and having the terms set
forth in the Trust Agreement;

         WHEREAS, the Capital Securities will be issued by the Issuer Trust and
the proceeds thereof, together with the proceeds from the issuance of the Issuer
Trust's Common Securities (as defined herein), will be used to purchase the
Debentures (as defined in the Trust Agreement) of the Guarantor, which
Debentures will be deposited with The Bank of New York Mellon, as Property
Trustee under the Trust Agreement, as trust assets; and

         WHEREAS, as an incentive for the Holders to purchase Capital
Securities, the Guarantors desire irrevocably and unconditionally to agree, to
the extent set forth herein, to pay to the Holders of the Capital Securities the
Guarantee Payments and Additional Guarantee Payments (as defined herein), as the
case may be, and to make certain other payments on the terms and conditions set
forth herein.

         NOW, THEREFORE, in consideration of the purchase of Capital Securities
by each Holder, which purchase the Guarantors hereby acknowledge shall benefit
the Guarantors, the Guarantors execute and deliver this Guarantee Agreement for
the benefit of the Holders from time to time.

                                   ARTICLE I

                                   DEFINITIONS

         SECTION 1.1. Definitions.

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

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

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




         (c) The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation";

         (d) All accounting terms used but not defined herein have the meanings
assigned to them in accordance with United States generally accepted accounting
principles;

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

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

         "Additional Guarantee Payments" means payments by the Additional
Guarantor with respect to the Guarantee Payments owed by the Guarantor.

         "Additional Guarantor" has the meaning specified in the preamble of
this Guarantee Agreement.

         "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

         "Board of Directors" means, as the context requires, the board of
directors of either of the Guarantors or the Executive Committee of the board of
directors of either of the Guarantors (or any other committee of the board of
directors of either of the Guarantors performing similar functions) or a
committee designated by the board of directors of either of the Guarantors (or
such committee), comprised of two or more members of the board of directors of
either of the Guarantors or officers of either of the Guarantors, or both.

         "Capital Securities" has the meaning specified in the recitals to this
Guarantee Agreement.

         "Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer Trust.

         "Event of Default" means (i) a default by either of the Guarantors in
any of its payment obligations under this Guarantee Agreement or (ii) a default
by either of the Guarantors in any other obligation under this Guarantee
Agreement that remains unremedied for 30 days.

         "Guarantee Agreement" means this Guarantee Agreement, as modified,
amended or supplemented from time to time.

         "Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Capital Securities, to the extent not
paid or made by or on behalf of the Issuer Trust: (i) any accumulated and unpaid
Distributions (as defined in the Trust Agreement) required to be paid on the
Capital Securities, to the extent the Issuer Trust shall have funds on hand
available therefor at such time; (ii) the Redemption Price (as defined in the
Trust Agreement) with respect to any Capital Securities called for redemption or
then subject to mandatory redemption by the Issuer Trust, to the extent the
Issuer Trust shall have funds on hand available therefor at such time; and (iii)
upon a voluntary or involuntary

                                      -2-




dissolution, winding-up or termination of the Issuer Trust, other than in
connection with the distribution of Debentures to the Holders or the redemption
of all the Capital Securities, the lesser of (a) the Liquidation Distribution
(as defined in the Trust Agreement) with respect to the Capital Securities, to
the extent that the Issuer Trust shall have funds on hand available therefor at
such time, and (b) the amount of assets of the Issuer Trust remaining available
for distribution to Holders on liquidation of the Issuer.

         "Guarantee Trustee" means The Bank of New York Mellon, solely in its
capacity as Guarantee Trustee and not in its individual capacity, until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Guarantee Agreement, and thereafter means each
such Successor Guarantee Trustee.

         "Guarantor" has the meaning specified in the preamble of this Guarantee
Agreement.

         "Guarantors" has the meaning specified in the preamble of this
Guarantee Agreement.

         "Holder" means any Holder (as defined in the Trust Agreement) of any
Capital Securities; provided, however, that in determining whether the holders
of the requisite percentage of Capital Securities have given any request,
notice, consent or waiver hereunder, "Holder" shall not include the Guarantors,
the Guarantee Trustee, or any Affiliate of the Guarantors or the Guarantee
Trustee.

         "Indenture" means the Junior Subordinated Indenture, dated as of
_______, 20___, among the Guarantor, the Additional Guarantor and The Bank of
New York Mellon, as trustee, as the same may be modified, amended or
supplemented from time to time.

         "Issuer Trust" has the meaning specified in the preamble of this
Guarantee Agreement.

         "List of Holders" has the meaning specified in Section 2.2(a).

         "Majority in Liquidation Amount of the Capital Securities" means,
except as provided by the Trust Indenture Act, Capital Securities representing
more than 50% of the aggregate Liquidation Amount (as defined in the Trust
Agreement) of all Capital Securities then Outstanding (as defined in the Trust
Agreement).

         "Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman or a Vice Chairman of the Board of Directors
of such Person or the President or a Vice President of such Person, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
such Person, and delivered to the Guarantee Trustee. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include:

         (a) a statement by each officer signing the Officers' Certificate that
such officer 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 Officers' 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.

                                      -3-




         "Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, company,
limited liability company, trust, statutory trust, 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
Senior Vice President, any Vice President, any Assistant Vice President, the
Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, any
Trust Officer or Assistant Trust Officer or any other officer of the Corporate
Trust Department of the Guarantee Trustee and also means, with respect to a
particular 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 4.1.

         "Trust Agreement" means the Amended and Restated Trust Agreement of the
Issuer Trust referred to in the recitals to this Guarantee Agreement, as
modified, amended or supplemented from time to time.

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

         "Vice President," when used with respect to either of the Guarantors,
means any duly appointed vice president, whether or not designated by a number
or a word or words added before or after the title "vice president."

                                   ARTICLE II

                               TRUST INDENTURE ACT

         SECTION 2.1. Trust Indenture Act; Application.

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

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

         SECTION 2.2. List of Holders.

         (a) The Guarantors shall furnish or cause to be furnished to the
Guarantee Trustee (a) semi-annually, on or before January 31 and July 31 of each
year, a list, in such form as the Guarantee Trustee may reasonably require, of
the names and addresses of the Holders (a "List of Holders") as of a date not
more than 15 days prior to the delivery thereof and (b) at such other times as
the Guarantee Trustee may

                                      -4-




request in writing, within 30 days after the receipt by the Guarantors of any
such request, a List of Holders as of a date not more than 15 days prior to the
time such list is furnished, in each case to the extent such information is in
the possession or control of the Guarantors and has not otherwise been received
by the Guarantee Trustee in its capacity as such. The Guarantee Trustee may
destroy any List of Holders previously given to it upon receipt of a new List of
Holders.

         (b) The Guarantee Trustee shall comply with the requirements of Section
311(a), Section 311(b) and Section 312(b) of the Trust Indenture Act.

         SECTION 2.3. Reports by the Guarantee Trustee.

         Not later than February 28 of each year, commencing in 20___, the
Guarantee Trustee shall provide to the Holders such reports as are required by
Section 313 of the Trust Indenture Act, if any, in the form and in the manner
provided by Section 313 of the Trust Indenture Act. The Guarantee Trustee shall
also comply with the requirements of Section 313(d) of the Trust Indenture Act.

         SECTION 2.4. Periodic Reports to the Guarantee Trustee.

         The Guarantors shall provide to the Guarantee Trustee, the Securities
and Exchange Commission and the Holders such documents, reports and information,
if any, as required by Section 314 of the Trust Indenture Act and the compliance
certificate required by Section 314 of the Trust Indenture Act, in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.

         SECTION 2.5. Evidence of Compliance with Conditions Precedent.

         Each of the Guarantors shall provide to the Guarantee Trustee such
evidence of compliance with such conditions precedent, if any, provided for in
this Guarantee Agreement that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer of either of the Guarantors pursuant to Section 314(c)(1)
may be given in the form of an Officers' Certificate.

         SECTION 2.6. Events of Default; Waiver.

         The Holders of at least a Majority in Liquidation Amount of the Capital
Securities may, by vote, on behalf of the Holders of all the Capital Securities,
waive any past default or Event of Default and its consequences. Upon such
waiver, any such default or Event of Default shall cease to exist, and any
default or Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Guarantee Agreement, but no such waiver shall
extend to any subsequent or other default or Event of Default or impair any
right consequent thereon.

         SECTION 2.7. Event of Default; Notice.

         (a) The Guarantee Trustee shall, within 90 days after the occurrence of
an Event of Default known to the Guarantee Trustee, transmit by mail, first
class postage prepaid, to the Holders notice of any such Event of Default,
unless such Event of Default has been cured before the giving of such notice,
provided that, except in the case of a default in the payment of a Guarantee
Payment, the Guarantee Trustee shall be protected in withholding such notice if
and so long as the board of directors, the executive committee or a trust
committee of directors and/or Responsible Officers of the Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests of
the Holders.

                                      -5-




         (b) The Guarantee Trustee shall not be deemed to have knowledge of any
Event of Default unless the Guarantee Trustee shall have received written
notice, or a Responsible Officer charged with the administration of this
Guarantee Agreement shall have obtained actual knowledge, of such Event of
Default.

         SECTION 2.8. Conflicting Interests.

         The Trust Agreement and the Indenture shall be deemed to be
specifically described in this Guarantee Agreement for the purposes of clause
(i) of the first proviso contained in Section 310(b) of the Trust Indenture Act.

                                  ARTICLE III

               POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE

         SECTION 3.1. Powers and Duties of the Guarantee Trustee.

         (a) This Guarantee Agreement shall be held by the Guarantee Trustee for
the benefit of the Holders, and the Guarantee Trustee shall not transfer this
Guarantee Agreement to any Person except to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Guarantee Trustee hereunder. The right, title and interest of the Guarantee
Trustee, as such, hereunder shall automatically vest in any Successor Guarantee
Trustee upon acceptance by such Successor Guarantee Trustee of its appointment
hereunder, and such vesting 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 has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.

         (c) The Guarantee Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Guarantee Agreement, and no implied covenants shall be read into this
Guarantee Agreement against the Guarantee Trustee. The Guarantee Trustee shall
exercise such of the rights and powers vested in it by this Guarantee Agreement,
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.

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

                  (i) Prior to the occurrence of any Event of Default and after
         the curing or waiving of all such 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 Agreement (including pursuant to Section
                  2.1), 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 Agreement; 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

                                      -6-




                  correctness of the opinions expressed therein, upon any
                  certificates or opinions furnished to the Guarantee Trustee
                  and conforming to the requirements of this Guarantee
                  Agreement; but in the case of any such certificates or
                  opinions that by any provision hereof or of the Trust
                  Indenture Act are specifically required to be furnished to the
                  Guarantee Trustee, the Guarantee Trustee shall be under a duty
                  to examine the same to determine whether or not they conform
                  to the requirements of this Guarantee Agreement.

                  (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 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 direction of the Holders of not less than 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 Agreement.

                  (iv) No provision of this Guarantee Agreement 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 or liability is not reasonably assured to it
         under the terms of this Guarantee Agreement or adequate indemnity
         against such risk or liability is not reasonably assured to it.

         SECTION 3.2. Certain Rights of Guarantee Trustee.

         (a) Subject to the provisions of Section 3.1:

                  (i) The Guarantee Trustee may 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 reasonably 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 either of the Guarantors
         contemplated by this Guarantee Agreement shall be sufficiently
         evidenced by an Officers' Certificate unless otherwise prescribed
         herein.

                  (iii) Whenever, in the administration of this Guarantee
         Agreement, the Guarantee Trustee shall deem it desirable that a matter
         be proved or established before taking, suffering or omitting to take
         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 rely upon an Officers' Certificate which, upon
         receipt of such request from the Guarantee Trustee, shall be promptly
         delivered by either of or both of the Guarantors.

                  (iv) The Guarantee Trustee may consult with legal counsel, and
         the written advice or opinion of such legal counsel with respect to
         legal matters shall be full and complete authorization and protection
         in respect of any action taken, suffered or omitted to be taken by it
         hereunder in good faith and in accordance with such advice or opinion.
         Such legal counsel may

                                      -7-




         be legal counsel to either of the Guarantors or any of its Affiliates
         and may be one of its employees. The Guarantee Trustee shall have the
         right at any time to seek instructions concerning the administration of
         this Guarantee Agreement from any court of competent jurisdiction.

                  (v) The Guarantee Trustee shall be under no obligation to
         exercise any of the rights or powers vested in it by this Guarantee
         Agreement at the request or direction of any Holder unless such Holder
         shall have provided to the Guarantee Trustee such adequate security and
         indemnity as would satisfy a reasonable person in the position of the
         Guarantee Trustee against the costs, expenses (including attorneys'
         fees and expenses) 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 that
         nothing contained in this Section 3.2(a)(v) 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 Agreement.

                  (vi) 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.

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

                  (viii) Whenever in the administration of this Guarantee
         Agreement 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, (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 acting in accordance with such
         instructions.

         (b) No provision of this Guarantee Agreement 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 to act in accordance with such power and
authority.

         SECTION 3.3. Compensation; Indemnity; Fees.

         Each of the Guarantors agrees:

                  (a) to pay to the Guarantee Trustee from time to time such
         reasonable compensation for all services rendered by it hereunder as
         may be agreed by the Guarantors and the Guarantee Trustee 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);

                  (b) except as otherwise expressly provided herein, to
         reimburse the Guarantee Trustee upon request for all reasonable
         expenses, disbursements and advances incurred or made

                                      -8-




         by the Guarantee Trustee in accordance with any provision of this
         Guarantee Agreement (including the reasonable compensation and the
         expenses and disbursements of its agents and counsel), except any such
         expense, disbursement or advance as may be attributable to its
         negligence or bad faith; and

                  (c) to indemnify the Guarantee Trustee for, and to hold it
         harmless against, any loss, liability or expense incurred without
         negligence, wilful misconduct or bad faith on the part of the Guarantee
         Trustee, arising out of or in connection with the acceptance or
         administration of this Guarantee Agreement, including the costs and
         expenses of defending itself against any claim or liability in
         connection with the exercise or performance of any of its powers or
         duties hereunder.

The Guarantee Trustee will not claim or exact any lien or charge on any
Guarantee Payments as a result of any amount due to it under this Guarantee
Agreement. The provisions of this Section 3.3 shall survive the termination of
this Guarantee Agreement or the resignation or removal of the Guarantee Trustee.

                                   ARTICLE IV

                                GUARANTEE TRUSTEE

         SECTION 4.1. Guarantee Trustee; Eligibility.

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

                  (i) not be an Affiliate of either of the Guarantors; and

                  (ii) be a Person that is eligible pursuant to the Trust
         Indenture Act to act as such and has a combined capital and surplus of
         at least $50,000,000, and shall be a corporation meeting the
         requirements of Section 310(a) of the Trust Indenture Act. If such
         corporation publishes reports of condition at least annually, pursuant
         to law or to the requirements of its supervising or examining
         authority, then, for the purposes of this Section 4.1 and to the extent
         permitted by the Trust Indenture Act, the combined capital and surplus
         of such corporation shall be deemed to be its combined capital and
         surplus as set forth in its most recent report of condition so
         published.

         (b) If at any time the Guarantee Trustee shall cease to be eligible to
so act under Section 4.1(a), the Guarantee Trustee shall immediately resign in
the manner and with the effect set out in Section 4.2.

         (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 and Guarantors shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.

         SECTION 4.2. Appointment, Removal and Resignation of the Guarantee
Trustee.

         (a) Subject to Section 4.2(b), the Guarantee Trustee may be appointed
or removed without cause at any time by either of the Guarantors.

         (b) The Guarantee Trustee shall not be removed 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 Guarantors.

                                      -9-




         (c) The Guarantee Trustee appointed hereunder 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 Guarantors, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantors and the resigning Guarantee
Trustee.

         (d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 60 days after
delivery to the Guarantors of an instrument of resignation, the resigning
Guarantee Trustee may petition, at the expense of the Guarantors, 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.

                                   ARTICLE V

                                    GUARANTEE

         SECTION 5.1. Guarantee.

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

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

         SECTION 5.2. Waiver of Notice and Demand.

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

         SECTION 5.3. Obligations Not Affected.

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

                                      -10-




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

                  (b) the extension of time for the payment by the Issuer Trust
         of all or any portion of the Distributions (other than an extension of
         time for payment of Distributions that results from the extension of
         any interest payment period on the Debentures as provided in the
         Indenture), Redemption Price, 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;

                  (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 Trust granting indulgence or extension of any kind;

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

                  (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

                  (g) any other circumstance whatsoever that might otherwise
         constitute a legal or equitable discharge or defense of a guarantor
         (other than payment of the underlying obligation), it being the intent
         of this Section 5.3 that the obligations of each of the Guarantors
         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 the
consent of, either of the Guarantors with respect to the happening of any of the
foregoing.

         SECTION 5.4. Rights of Holders.

         Each of the Guarantors expressly acknowledges that: (i) this Guarantee
Agreement will be deposited with the Guarantee Trustee to be held for the
benefit of the Holders; (ii) the Guarantee Trustee has the right to enforce this
Guarantee Agreement on behalf of the Holders; (iii) 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 Agreement or exercising any trust
or power conferred upon the Guarantee Trustee under this Guarantee Agreement;
and (iv) any Holder may institute a legal proceeding directly against either of
the Guarantors to enforce its rights under this Guarantee Agreement without
first instituting a legal proceeding against the Guarantee Trustee, the Issuer
Trust or any other Person.

         SECTION 5.5. Guarantee of Payment.

         This Guarantee Agreement creates a guarantee of payment and not of
collection. This Guarantee Agreement will not be discharged except by payment of
the Guarantee Payments in full (without

                                      -11-




duplication of amounts theretofore paid by the Issuer Trust) or upon the
distribution of Debentures to Holders as provided in the Trust Agreement.

         SECTION 5.6. Subrogation.

         Each of the Guarantors shall be subrogated to all rights (if any) of
the Holders against the Issuer Trust in respect of any amounts paid to the
Holders by such Guarantors under this Guarantee Agreement; provided, however,
that the Guarantors shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any rights which they may
acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Guarantee Agreement,
if, at the time of any such payment, any amounts are due and unpaid under this
Guarantee Agreement. If any amount shall be paid to either of the Guarantors in
violation of the preceding sentence, the Guarantor or the Additional Guarantor,
as the case may be, agrees to hold such amount in trust for the Holders and to
pay over such amount to the Holders.

         SECTION 5.7. Independent Obligations.

         Each of the Guarantors acknowledges that its obligations hereunder are
independent of the obligations of the Issuer Trust with respect to the Capital
Securities and that it shall be liable as principal and as debtor hereunder to
make Guarantee Payments or Additional Guarantee Payments, as the case may be,
pursuant to the terms of this Guarantee Agreement notwithstanding the occurrence
of any event referred to in subsections (a) through (g), inclusive, of Section
5.3 hereof.

         SECTION 5.8. Guarantee Payments and Additional Guarantee Payments Free
of Puerto Rico Tax.

         All Guarantee Payments and Additional Guarantee Payments shall be made
without set-off, counterclaim, fees, liabilities or similar deductions, and free
and clear of, and without deduction or withholding for, taxes, levies, imposts,
duties, charges or fees of whatsoever nature now or hereafter imposed, levied,
collected, deducted, withheld or assessed by or on behalf of the Commonwealth of
Puerto Rico or any district, municipality or political subdivision or taxing
authority thereof or therein ("Taxes"). If the Additional Guarantor or any agent
thereof is required by law or regulation to make any deduction or withholding
for or on account of Taxes, the Additional Guarantor shall pay such additional
amounts (the "Tax Gross-Up Amounts") as shall be necessary in order that the net
amounts received pursuant to the Guarantee Agreement by the Holders of the
Capital Securities or the holders or beneficial owners of any interest therein
or rights in respect thereof after such deduction or withholding shall equal the
amount that would have been receivable thereunder in the absence of such
deduction or withholding, except that no such Tax Gross-Up Amounts shall be
payable:

                  (a) to any Holder of a Capital Security or any interest
         therein or rights in respect thereof where such deduction or
         withholding is required by reason of such Holder having some connection
         with the Commonwealth of Puerto Rico or any political subdivision or
         taxing authority thereof or thereon other than the mere holding of a
         payment in respect of such security;

                  (b) in respect of any deduction or withholding that would not
         have been required but for the presentation by the Holder of a Capital
         Security for payment on a date more than 30 days after the date on
         which payment thereof is duly provided for; or

                  (c) in respect of any deduction or withholding that would not
         have been required but for the failure to comply with any
         certification, identification or other reporting requirements
         concerning the nationality, residence, identity or connection with the
         Commonwealth of Puerto

                                      -12-




         Rico, or any political subdivision or taxing authority thereof or
         therein, of the Holder of a Capital Security or any interest therein or
         rights in respect thereof, if compliance is required by the
         Commonwealth of Puerto Rico, or any political subdivision or taxing
         authority thereof or therein, as a precondition to exemption from such
         deduction or withholding.

                                   ARTICLE VI

                           COVENANTS AND SUBORDINATION

         SECTION 6.1. Subordination.

         The obligations of each of the Guarantors under this Guarantee
Agreement will constitute unsecured obligations of each of the Guarantors and
will rank subordinate and junior in right of payment to all Senior Debt (as
defined in the Indenture) of each of the Guarantors, respectively, to the extent
and in the manner set forth in the Indenture with respect to the Debentures, and
the provisions of Article XII of the Indenture will apply, mutatis mutandis, to
the obligations of each of the Guarantors hereunder. The obligations of each of
the Guarantors hereunder do not constitute Senior Debt (as defined in the
Indenture) of each of the Guarantors, respectively.

         SECTION 6.2. Pari Passu Guarantees.

         The obligations of each of the Guarantors under this Guarantee
Agreement shall rank pari passu with the obligations of each of the Guarantors,
respectively, under (i) any similar guarantee agreements issued by the Guarantor
or the Additional Guarantor, as the case may be, on behalf of the holders of
preferred or capital securities issued by any Issuer Trust (as defined in the
Indenture), (ii) the Indenture and the Securities (as defined therein) issued
thereunder; (iii) the Expense Agreement (as defined in the Trust Agreement) and
any similar expense agreements entered into by the Guarantor or the Additional
Guarantor, as the case may be, in connection with the offering of Capital
Securities (as defined in the Indenture) by any Issuer Trust (as defined in the
Indenture), and (iv) any other security, guarantee or other agreement or
obligation that is expressly stated to rank pari passu with the obligations of
the Guarantor or the Additional Guarantor, as the case may be, under this
Guarantee Agreement or with any obligation that ranks pari passu with the
obligations of the Guarantor or the Additional Guarantor, as the case may be,
under this Guarantee Agreement.

         SECTION 6.3. Common Stock.

         The obligations of each of the Guarantors under this Guarantee
Agreement shall rank senior in right of payment to the obligations of the
Guarantors on common stock issued by each of the Guarantors, respectively.

                                   ARTICLE VII

                                   TERMINATION

         SECTION 7.1. Termination.

         This Guarantee Agreement shall terminate and be of no further force and
effect upon (i) full payment of the Redemption Price (as defined in the Trust
Agreement) of all Capital Securities, (ii) the distribution of Debentures to the
Holders in exchange for all of the Capital Securities or (iii) full payment of
the amounts payable in accordance with Article IX of the Trust Agreement upon
liquidation of the Issuer Trust. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or

                                      -13-




will be reinstated, as the case may be, if at any time any Holder is required to
repay any sums paid with respect to Capital Securities or this Guarantee
Agreement.

                                  ARTICLE VIII

                                  MISCELLANEOUS

         SECTION 8.1. Successors and Assigns.

         All guarantees and agreements contained in this Guarantee Agreement
shall bind the successors, assigns, receivers, trustees and representatives of
each of the Guarantors, respectively, and shall inure to the benefit of the
Holders of the Capital Securities then outstanding. Except in connection with a
consolidation, merger or sale involving either of the Guarantors that is
permitted under Article VIII of the Indenture and pursuant to which the
successor or assignee agrees in writing to perform such Guarantor's obligations
hereunder, each of the Guarantors shall not assign its obligations hereunder,
and any purported assignment other than in accordance with this provision shall
be void.

         SECTION 8.2. Amendments.

         Except with respect to any changes that do not adversely affect the
rights of the Holders in any material respect (in which case no consent of the
Holders will be required), this Guarantee Agreement may only be amended with the
prior approval of the Holders of not less than a Majority in Liquidation Amount
of the Capital Securities. The provisions of Article VI of the Trust Agreement
concerning meetings of the Holders shall apply to the giving of such approval.

         SECTION 8.3. Notices.

         Any notice, request or other communication required or permitted to be
given hereunder shall be in writing, duly signed by the party giving such
notice, and delivered, telecopied or mailed by first class mail as follows:

         (a) if given to the Guarantor, to the address or telecopy number set
forth below (with a copy to the Additional Guarantor) or such other address or
telecopy number as the Guarantor may give notice to the Guarantee Trustee and
the Holders:

                           Popular North America, Inc.
                           209 Munoz Rivera Avenue
                           San Juan, Puerto Rico 00918
                           Attention: ___________
                           Telecopy: ____________

         (b) if given to the Additional Guarantor, to the address or telecopy
number set forth below or such other address or telecopy number as the
Additional Guarantor may give notice to the Guarantee Trustee and the Holders:

                           Popular, Inc.
                           209 Munoz Rivera Avenue
                           San Juan, Puerto Rico 00918
                           Attention: ___________
                           Telecopy: ____________

                                      -14-




         (c) if given to the Guarantee Trustee, at the address or telecopy
number set forth below or such other address or telecopy number as the Guarantee
Trustee may give notice to the Guarantor and Holders:

                           The Bank of New York Mellon
                           [to come]
                           Attention:  ________________
                           Telecopy:  ________________

with a copy to:

                           Popular North America Capital Trust __
                           c/o Popular North America, Inc.
                           209 Munoz Rivera Avenue
                           San Juan, Puerto Rico 00918
                           Attention: ___________
                           Telecopy: ____________

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

         All notices hereunder 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 Agreement is solely for the benefit of the Holders and
is not separately transferable from the Capital Securities.

         SECTION 8.5. Governing Law.

         THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND WHOLLY TO BE PERFORMED IN SUCH STATE.

         SECTION 8.6. Counterparts.

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

                                      -15-




         IN WITNESS WHEREOF, the parties hereto have executed this Guarantee
Agreement as of the day and year first above written.

                                        POPULAR NORTH AMERICA, INC.

                                        By: ___________________________________
                                            Name:
                                            Title:

                                        POPULAR, INC.

                                        By: ___________________________________
                                            Name:
                                            Title:

                                        THE BANK OF NEW YORK MELLON,
                                        as Guarantee Trustee

                                        By: ___________________________________
                                            Name:
                                            Title:

EX-4.24

Exhibit 4.24

CERTIFICATE OF AMENDMENT

TO

CERTIFICATE OF TRUST

OF

POPULAR NORTH AMERICA CAPITAL TRUST II

THIS Certificate of Amendment to Certificate of Trust of Popular North America Capital Trust II (the “Trust”), is being duly executed and filed by the undersigned trustee to amend the Certificate of Trust of the Trust, which was filed on September 5, 2003 (the “Certificate of Trust”), with the Secretary of State of the State of Delaware under the Delaware Statutory Trust Act (12 Del. C. § 3801, et seq.)(the “Act”).

1.        Name. The name of the statutory trust is Popular Capital Trust II.

2.        Amendment to Certificate of Trust.    The Certificate of Trust is hereby amended by amending and restating Section 2 thereof in its entirety as follows:

“2.       The name and business address of the trustee of the Trust in the State of Delaware is BNY Mellon Trust of Delaware, 100 White Clay Center, Suite 102, Newark, Delaware 19711.”

3.        Effective Date.    This Certificate of Amendment shall be effective upon filing.

IN WITNESS WHEREOF, the undersigned trustee of the Trust has executed this Certificate of Amendment in accordance with Section 3811(a)(2) of the Act.

BNY MELLON TRUST OF DELAWARE, not in its individual capacity, but solely as trustee
By:	/s/ Vincent E. Sampson
	Name: Vincent E. Sampson
	Title: President

CERTIFICATE OF AMENDMENT

TO

CERTIFICATE OF TRUST

OF

POPULAR NORTH AMERICA CAPITAL TRUST III

THIS Certificate of Amendment to Certificate of Trust of Popular North America Capital Trust II (the “Trust”), is being duly executed and filed by the undersigned trustee to amend the Certificate of Trust of the Trust, which was filed on September 5, 2003 (the “Certificate of Trust”), with the Secretary of State of the State of Delaware under the Delaware Statutory Trust Act (12 Del. C. § 3801, et seq.)(the “Act”).

1.        Name. The name of the statutory trust is Popular Capital Trust III.

2.        Amendment to Certificate of Trust.    The Certificate of Trust is hereby amended by amending and restating Section 2 thereof in its entirety as follows:

“2.       The name and business address of the trustee of the Trust in the State of Delaware is BNY Mellon Trust of Delaware, 100 White Clay Center, Suite 102, Newark, Delaware 19711.”

3.         Effective Date.    This Certificate of Amendment shall be effective upon filing.

IN WITNESS WHEREOF, the undersigned trustee of the Trust has executed this Certificate of Amendment in accordance with Section 3811(a)(2) of the Act.

BNY MELLON TRUST OF DELAWARE, not in its individual capacity, but solely as trustee
By:	/s/ Vincent E. Sampson
	Name: Vincent E. Sampson
	Title: President

EX-5.1

Exhibit 5.1

[Letterhead of Popular, Inc.]

June 19, 2012

The Board of Directors

Popular, Inc.

209 Muñoz Rivera Avenue

San Juan, Puerto Rico 00918

The Board of Directors

Popular North America, Inc.

209 Muñoz Rivera Avenue

San Juan, Puerto Rico 00918

Ladies and Gentlemen:

In connection with the registration under the Securities Act of 1933 (the “Act”) of an indeterminate amount of the following securities (i) (a) senior debt securities (the “Popular Senior Debt Securities”) of Popular, Inc., a Puerto Rico corporation (the “Corporation”), (b) subordinated debt securities (the “Popular Subordinated Debt Securities”) of the Corporation, (c) shares of common stock, par value $0.01 per share (the “Popular Common Stock”), of the Corporation, and (d) shares of preferred stock, without par value (the “Popular Preferred Stock”), of the Corporation, and (ii) (a) senior debt securities (the “PNA Senior Debt Securities”) of Popular North America, Inc., a Delaware corporation (“PNA”), bearing the unconditional guarantees (the “PNA Senior Debt Guarantees”) of the Corporation, and (b) subordinated debt securities (the “PNA Subordinated Debt Securities”) of PNA bearing the unconditional guarantees (the “PNA Subordinated Debt Guarantees”) of the Corporation (the Popular Senior Debt Securities, the Popular Subordinated Debt Securities, the PNA Senior Debt Securities and the PNA Subordinated Debt Securities are sometimes collectively referred to herein as the “Debt Securities”; the PNA Senior Debt Guarantees and the PNA Subordinated Debt Guarantees are sometimes collectively referred to herein as the “Guarantees”; and the Debt Securities, the Guarantees, the Popular Common Stock and the Popular Preferred Stock are sometimes collectively referred to herein as the “Securities”), I, as Executive Vice President and Chief Legal Officer to the Corporation and PNA, have examined such corporate records, certificates and other documents, including the resolutions of the Boards of Directors of the Corporation and PNA (the “Corporation Resolutions” and “PNA Resolutions”, respectively) authorizing the issuance of the Securities, and such questions of law, as I have considered necessary or appropriate for the purposes of this opinion. On the basis of such examination, I advise you that, in my opinion:

(i) When the registration statement relating to the Securities (the “Registration Statement”) has become effective under the Act, the terms of the Popular Senior Debt Securities and of their issuance and sale have been duly established in conformity with the indenture, as supplemented,

Popular, Inc.

Popular North America, Inc.

June 19, 2012

relating to the Popular Senior Debt Securities (the “Popular Senior Indenture”) so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Corporation, and the Popular Senior Debt Securities have been duly executed and authenticated in accordance with the Popular Senior Indenture and issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the Corporation Resolutions, the Popular Senior Debt Securities will constitute valid and legally binding obligations of the Corporation, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

(ii) When the Registration Statement has become effective under the Act, the terms of the Popular Subordinated Debt Securities and of their issuance and sale have been duly established in conformity with the indenture relating to the Popular Subordinated Debt Securities (the “Popular Subordinated Indenture”) so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Corporation, and the Popular Subordinated Debt Securities have been duly executed and authenticated in accordance with the Popular Subordinated Indenture and issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the Corporation Resolutions, the Popular Subordinated Debt Securities will constitute valid and legally binding obligations of the Corporation, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

(iii) When the Registration Statement has become effective under the Act, the terms of the PNA Senior Debt Securities and the PNA Senior Debt Guarantees and of their issuance and sale have been duly established in conformity with the indenture, as supplemented, relating to the PNA Senior Debt Securities and the PNA Senior Debt Guarantees (the “PNA Senior Indenture”) so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon PNA or the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over PNA or the Corporation, the PNA Senior Debt Securities have been duly executed and authenticated and the PNA Senior Debt Guarantees have been duly executed, each in accordance with the PNA Senior Indenture, and the PNA Senior Debt Securities have been issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the PNA Resolutions and the Corporation Resolutions, as applicable, the PNA Senior Debt Securities will constitute valid and legally binding obligations of PNA and the PNA Senior Debt Guarantees will constitute valid and legally binding obligations of the Corporation, in each case subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

Popular, Inc.

Popular North America, Inc.

June 19, 2012

(iv) When the Registration Statement has become effective under the Act, the indenture relating to the PNA Subordinated Debt Securities and the PNA Subordinated Debt Guarantees (the “PNA Subordinated Indenture”) has been duly executed and delivered by PNA, the Corporation and the trustee thereunder, the terms of the PNA Subordinated Debt Securities and the PNA Subordinated Debt Guarantees and of their issuance and sale have been duly established in conformity with the PNA Subordinated Indenture so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon PNA or the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over PNA or the Corporation, the PNA Subordinated Debt Securities have been duly executed and authenticated and the PNA Subordinated Debt Guarantees have been duly executed, each in accordance with the PNA Subordinated Indenture, and the PNA Subordinated Debt Securities have been issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the PNA Resolutions and the Corporation Resolutions, as applicable, the PNA Subordinated Debt Securities will constitute valid and legally binding obligations of PNA and the PNA Subordinated Debt Guarantees will constitute valid and legally binding obligations of the Corporation, in each case subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

(v) When the Registration Statement has become effective under the Act, and when the shares of Popular Common Stock have been established in conformity with the Corporation’s restated certificate of incorporation so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Corporation, all regulatory consents or approvals for the issuance and sale of the Popular Common Stock have been obtained and the Popular Common Stock has been duly issued and sold issued and sold by the Company for a price per share not less than the par value thereof and as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the Corporation Resolutions, such shares of Popular Common Stock will be validly issued and outstanding, fully paid and nonassessable.

(vi) When the Registration Statement has become effective under the Act, a certificate with respect to the Popular Preferred Stock has been duly filed and recorded with the Department of State of the Commonwealth of Puerto Rico as required by the General Corporation Law of the Commonwealth of Puerto Rico, the terms of the Popular Preferred Stock and of its issuance and sale have been duly established in conformity with the Corporation’s restated certificate of incorporation so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Corporation, all regulatory consents or approvals for the issuance and sale of the Popular Preferred Stock have been obtained and the Popular Preferred Stock has been duly issued and sold as contemplated by the prospectus or

Popular, Inc.

Popular North America, Inc.

June 19, 2012

prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the Corporation Resolutions, the Popular Preferred Stock will be validly issued, fully paid and nonassessable, and any shares of Popular Preferred Stock initially issuable upon conversion or exchange of shares of Popular Preferred Stock of another series, when duly issued upon such conversion or exchange, will be validly issued, fully paid and nonassessable.

I note that, as of the date of this opinion, a judgment for money in an action based on a Debt Security denominated in a foreign currency or currency unit, or on a related Guarantee, in a Federal or state court in the United States ordinarily would be enforced in the United States only in United States dollars. The date used to determine the rate of conversion of the foreign currency or currency unit in which a particular Debt Security is denominated into United States dollars will depend upon various factors, including which court renders the judgment. Under Section 27 of the New York Judiciary Law, a state court in the State of New York rendering a judgment on a Debt Security denominated in a foreign currency, or on a related Guarantee, would be required to render such judgment in the foreign currency or currency unit in which the Debt Security is denominated, and such judgment would be converted into United States dollars at the exchange rate prevailing on the date of entry of the judgment.

The foregoing opinion is limited to the Federal laws of the United States, the General Corporation Law of the State of Delaware and the laws of the State of New York and the Commonwealth of Puerto Rico, and I am expressing no opinion as to the effect of the laws of any other jurisdiction. With respect to all matters of the laws of the State of New York and of the General Corporation Law of the State of Delaware, I have relied upon the opinion, dated the date hereof, of Sullivan & Cromwell LLP, and my opinion is subject to the same assumptions, qualifications and limitations with respect to such matters as are contained in such opinion of Sullivan & Cromwell LLP.

Also, I have relied as to certain matters on information obtained from public officials, officers of the Corporation and PNA, and other sources believed by me to be responsible, and I have assumed that each of the Popular Senior Indenture, the Popular Subordinated Indenture and the PNA Senior Indenture has been duly authorized, executed and delivered by the respective trustee thereunder, assumptions which I have not independently verified. Finally, I have assumed that the authority granted in the Corporation Resolutions and PNA Resolutions will remain in effect at all relevant times.

This opinion may be relied upon by Sullivan & Cromwell LLP as to matters of the laws of the Commonwealth of Puerto Rico.

I hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to me under the heading “Validity of the Securities” in the Prospectus contained in the Registration Statement. In giving such consent, I do not thereby admit that I am in the category of persons whose consent is required under Section 7 of the Act.

Very truly yours,

/s/ Ignacio Alvarez

EX-5.2

Exhibit 5.2

[Letterhead of Sullivan & Cromwell LLP]

June 19, 2012

Popular, Inc.,

        209 Muñoz Rivera Avenue,

                San Juan, Puerto Rico 00918.

Popular North America, Inc.,

        209 Muñoz Rivera Avenue,

                San Juan, Puerto Rico 00918.

Ladies and Gentlemen:

We are acting as counsel to Popular, Inc., a Puerto Rico corporation (the “Corporation”), in connection with the filing today by the Corporation of a registration statement on Form S-3 (the “Registration Statement”) under the Securities Act of 1933 (the “Act”). The Registration Statement registers an indeterminate amount of securities, including the following securities:

(i) senior debt securities (the “Popular Senior Debt Securities”) of the Corporation and subordinated debt securities (the “Popular Subordinated Debt Securities”) of the Corporation, and

(ii) senior debt securities (the “PNA Senior Debt Securities”) of Popular North America, Inc., a Delaware corporation (“PNA”), bearing the unconditional guarantees (the “PNA Senior Debt Guarantees”) of the Corporation, and subordinated debt securities (the “PNA Subordinated Debt Securities”) of PNA, bearing the unconditional guarantees (the “PNA Subordinated Debt Guarantees”) of the Corporation.

We, as your counsel, have examined such corporate records, certificates and other documents, including the resolutions of the Boards of Directors of the Corporation and PNA (the “Corporation Resolutions” and “PNA Resolutions”,

Popular, Inc. Popular North America, Inc. -2-

respectively) authorizing the issuance of the Popular Senior Debt Securities, the Popular Subordinated Debt Securities, the PNA Senior Debt Securities and the PNA Subordinated Debt Securities (sometimes collectively referred to herein as the “Debt Securities”), and such questions of law, as we have considered necessary or appropriate for the purposes of this opinion. Upon the basis of such examination, we advise you that, in our opinion:

(1) When the Registration Statement has become effective under the Act, the terms of the Popular Senior Debt Securities and of their issuance and sale have been duly established in conformity with the indenture, as supplemented, relating to the Popular Senior Debt Securities (the “Popular Senior Indenture”) so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Corporation, and the Popular Senior Debt Securities have been duly executed and authenticated in accordance with the Popular Senior Indenture and issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the Corporation Resolutions, the Popular Senior Debt Securities will constitute valid and legally binding obligations of the Corporation, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

(2) When the Registration Statement has become effective under the Act, the terms of the Popular Subordinated Debt Securities and of their issuance and sale have been duly established in conformity with the indenture relating to the Popular Subordinated Debt Securities (the “Popular Subordinated Indenture”) so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Corporation, and the Popular Subordinated Debt Securities have been duly executed and authenticated in accordance with the Popular Subordinated Indenture and issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the Corporation Resolutions, the Popular Subordinated Debt Securities will constitute valid and legally binding obligations of the Corporation, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

(3) When the Registration Statement has become effective under the Act, the terms of the PNA Senior Debt Securities and the PNA Senior Debt Guarantees and of their issuance and sale have been duly established in conformity with the indenture, as supplemented, relating to the PNA Senior Debt Securities (the “PNA Senior Indenture”) so as not to violate any applicable law or result in a default under or breach of any

Popular, Inc. Popular North America, Inc. -3-

agreement or instrument binding upon PNA or the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over PNA or the Corporation, the PNA Senior Debt Securities have been duly executed and authenticated and the PNA Senior Debt Guarantees have been duly executed, each in accordance with the PNA Senior Indenture, and the PNA Senior Debt Securities have been issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the PNA Resolutions and the Corporation Resolutions, as applicable, the PNA Senior Debt Securities will constitute valid and legally binding obligations of PNA and the PNA Senior Debt Guarantees will constitute valid and legally binding obligations of the Corporation, in each case subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

(4) When the Registration Statement has become effective under the Act, the terms of the PNA Subordinated Debt Securities and the PNA Subordinated Debt Guarantees and of their issuance and sale have been duly established in conformity with the indenture relating to the PNA Subordinated Securities (the “PNA Subordinated Indenture”) so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon PNA or the Corporation and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over PNA or the Corporation, the PNA Subordinated Debt Securities have been duly executed and authenticated and the PNA Subordinated Debt Guarantees have been duly executed, each in accordance with the PNA Subordinated Indenture, and the PNA Subordinated Debt Securities have been issued and sold as contemplated by the prospectus or prospectus supplement relating to the offer and sale thereof, and if all the foregoing actions are taken pursuant to the authority granted in the PNA Resolutions and the Corporation Resolutions, as applicable, the PNA Subordinated Debt Securities will constitute valid and legally binding obligations of PNA and the PNA Subordinated Debt Guarantees will constitute valid and legally binding obligations of the Corporation, in each case subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

We note that, as of the date of this opinion, a judgment for money in an action based on a Debt Security denominated in a foreign currency or currency unit, or on a related Guarantee, in a Federal or state court in the United States ordinarily would be enforced in the United States only in United States dollars. The date used to determine the rate of conversion of the foreign currency or currency unit in which a particular Debt Security is denominated into United States dollars will depend upon various factors, including which court renders the judgment. Under Section 27 of the New York Judiciary Law a state court in the State of New York rendering a judgment on a Debt

Popular, Inc. Popular North America, Inc. -4-

Security denominated in a foreign currency, or on a related Guarantee, would be required to render such judgment in the foreign currency or currency unit in which the Debt Security is denominated, and such judgment would be converted into United States dollars at the exchange rate prevailing on the date of entry of the judgment.

The foregoing opinion is limited to the Federal laws of the United States, the laws of the State of New York and the Commonwealth of Puerto Rico, and the General Corporation Law of the State of Delaware, and we are expressing no opinion as to the effect of the laws of any other jurisdiction. With respect to all matters of the laws of the Commonwealth of Puerto Rico, we have relied upon the opinion, dated the date hereof, of Ignacio Alvarez, Esq., Puerto Rico counsel to the Corporation and PNA, and our opinion is subject to the same assumptions, qualifications and limitations with respect to such matters as are contained in such opinion of Ignacio Alvarez.

Also, we have relied as to certain factual matters on information obtained from public officials, officers of the Corporation and PNA, and other sources believed by us to be responsible, and we have assumed that each of the Popular Senior Indenture, the Popular Subordinated Indenture, the PNA Senior Indenture and the PNA Subordinated Indenture has been duly authorized, executed and delivered by the Trustee thereunder, assumptions which we have not independently verified. Finally, we have assumed that the authority granted in the Corporation Resolutions and PNA Resolutions will remain in effect at all relevant times.

This opinion may be relied upon by Ignacio Alvarez, Esq. as to matters of the laws of the State of New York and the General Corporation Law of the State of Delaware.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the references to us under the heading “Validity of the Securities” in the prospectus contained therein. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act.

Very truly yours,                            

Sullivan & Cromwell LLP

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated February 29, 2012 relating to the financial statements and the effectiveness of internal control over financial reporting, which appears in the Annual Report to Shareholders, which is incorporated by reference in Popular, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

/s/ PRICEWATERHOUSECOOPERS LLP

PricewaterhouseCoopers LLP

San Juan, Puerto Rico

June 19, 2012

EX-25.1

Exhibit 25.1

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)
Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Senior Debt Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices .	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski                                  Directors

EX-25.2

Exhibit 25.2

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)
Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Subordinated Debt Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name:	Erika Walker
	Title:	Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices .	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski                                  Directors

EX-25.3

Exhibit 25.3

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR NORTH AMERICA, INC.

(Exact name of obligor as specified in its charter)

Delaware	66-0476353
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Senior Debt Securities

and Guarantees of Senior Debt Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

- 2 -

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name:	Erika Walker
	Title:	Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices .	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski                                  Directors

EX-25.4

Exhibit 25.4

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)
Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Junior Subordinated Debt Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices .	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski                                  Directors

EX-25.5

EXHIBIT 25.5

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR NORTH AMERICA, INC.

(Exact name of obligor as specified in its charter)

Delaware	66-0476353
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Junior Subordinated Debt Securities

and Guarantees of Junior Subordinated Debt Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski Directors

EX-25.6

EXHIBIT 25.6

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR CAPITAL TRUST IV

(Exact name of obligor as specified in its charter)

Delaware	66-6031656
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Capital Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski Directors

EX-25.7

EXHIBIT 25.7

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Guarantees of Capital Securities

of Popular Capital Trust IV and certain backup undertakings

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski Directors

EX-25.8

EXHIBIT 25.8

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR NORTH AMERICA CAPITAL TRUST II

(Exact name of obligor as specified in its charter)

Delaware	60-6031653
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Capital Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski Directors

EX-25.9

EXHIBIT 25.9

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

POPULAR NORTH AMERICA, INC.

(Exact name of obligor as specified in its charter)

Delaware	66-0476353
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Guarantees of Capital Securities

of Popular North America Capital Trust II

and certain backup undertakings

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski Directors

EX-25.10

EXHIBIT 25.10

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR NORTH AMERICA CAPITAL TRUST III

(Exact name of obligor as specified in its charter)

Delaware	60-6031652
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Capital Securities

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski Directors

EX-25.11

EXHIBIT 25.11

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

THE BANK OF NEW YORK MELLON

(Exact name of trustee as specified in its charter)

New York	13-5160382
(Jurisdiction of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

POPULAR, INC.

(Exact name of obligor as specified in its charter)

Puerto Rico	66-0667416
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

POPULAR NORTH AMERICA, INC.

(Exact name of obligor as specified in its charter)

Delaware	66-0476353
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Popular Center Building 209 Muñoz Rivera Avenue Hato Rey, Puerto Rico	00918
(Address of principal executive offices)	(Zip code)

Guarantees of Capital Securities

of Popular North America Capital Trust III

and certain backup undertakings

(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York	33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, N.Y. 10005

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).

4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).

- 2 -

6. The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).

7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

- 3 -

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of June, 2012.

THE BANK OF NEW YORK MELLON
By:	/s/ Erika Walker
	Name: Erika Walker
	Title: Vice President

- 4 -

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON

of One Wall Street, New York, N.Y. 10286

And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

	Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin		3,021,000
Interest-bearing balances		88,872,000
Securities:
Held-to-maturity securities		4,819,000
Available-for-sale securities		79,781,000
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		11,000
Securities purchased under agreements to resell		719,000
Loans and lease financing receivables:
Loans and leases held for sale		9,000
Loans and leases, net of unearned income		25,163,000
LESS: Allowance for loan and lease losses		342,000
Loans and leases, net of unearned income and allowance		24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
Goodwill		6,449,000
Other intangible assets		1,575,000

Other assets	13,237,000
Total assets	229,715,000
LIABILITIES
Deposits:
In domestic offices	94,919,000
Noninterest-bearing	60,836,000
Interest-bearing	34,083,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
Noninterest-bearing	3,607,000
Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices	2,367,000
Securities sold under agreements to repurchase	1,171,000
Trading liabilities	5,723,000
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures	3,505,000
Other liabilities	7,275,000
Total liabilities	210,784,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,135,000
Surplus (exclude all surplus related to preferred stock)	9,658,000
Retained earnings	8,773,000
Accumulated other comprehensive income	-985,000
Other equity capital components	0
Total bank equity capital	18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries	350,000
Total equity capital	18,931,000
Total liabilities and equity capital	229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,

Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell Catherine A. Rein Michael J. Kowalski Directors