COMMUNITY FIRST BANKSHARES INC, S-3/A, 1997-01-30

COMMUNITY FIRST BANKSHARES INC
S-3/A, 1997-01-30
STATE COMMERCIAL BANKS

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<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 30, 1997
REGISTRATION NO. 333-19921
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------

<TABLE>
<S> <C>
COMMUNITY FIRST BANKSHARES, INC. CFB CAPITAL I
(Exact name of registrant as specified in its (Exact name of co-registrant as specified in
charter) its charter)
DELAWARE DELAWARE
(State or other jurisdiction of incorporation (State or other jurisdiction of incorporation
or organization) or organization)
46-0391436 41-6422292
(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.)
c/o Community First Bankshares, Inc.
520 Main Avenue 520 Main Avenue
Fargo, North Dakota 58124-0001 Fargo, North Dakota 58124-0001
(701) 298-5600 (701) 298-5600
(Address including zip code, and telephone (Address including zip code, and telephone
number, number,
including area code, of registrant's principal including area code, of co-registrant's
executive office) principal executive office)
</TABLE>

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

Donald R. Mengedoth
President
Community First Bankshares, Inc.
520 Main Avenue
Fargo, North Dakota 58124-0001
(701) 298-5600
(Name, address, including zip code, and telephone number
including area code, of agent for service)
--------------------------

COPIES TO:

<TABLE>
<S> <C>
Patrick Delaney David B. Miller
Martin R. Rosenbaum Keyna P. Skeffington
Lindquist & Vennum P.L.L.P. Faegre & Benson, LLP
4200 IDS Center 2200 Norwest Center
80 South 8th Street 90 South Seventh Street
Minneapolis, Minnesota 55402 Minneapolis, Minnesota 55402
Telephone: (612) 371-3211 Telephone: (612) 336-3000
</TABLE>

Approximate date of commencement of proposed sale to public: As soon as
practicable after this Registration Statement becomes effective.

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. / /

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of 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 delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.

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<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>

PROSPECTUS Subject to completion, dated January 30, 1997

DATED , 1997
2,400,000 CAPITAL SECURITIES
CFB CAPITAL I
% Cumulative Capital Securities
(Liquidation Amount $25 per Capital Security)
Fully and Unconditionally Guaranteed, as Described Herein, by

[LOGO]

The % Cumulative Capital Securities (the "Capital Securities") offered hereby
represent undivided beneficial interests in the assets of CFB Capital I, a
statutory business trust formed under the laws of the State of Delaware ("CFB
Capital"). Community First Bankshares, Inc., a Delaware corporation (the
"Company"), will be the owner of all of the beneficial interests represented by
common securities of CFB Capital (the "Common Securities" and, collectively with
the Capital Securities, the "Trust Securities"). CFB Capital exists for the sole
purpose of issuing the Trust Securities and investing the proceeds thereof in
% Junior Subordinated Debentures (the "Junior Subordinated Debentures") to be
issued by the Company. The Junior Subordinated Debentures will mature on
February 1, 2027, which date may be shortened (such date, as it may be
shortened, the "Stated Maturity") to a date not earlier than February 1, 2002 if
certain conditions are met (including the Company having received prior approval
of the Board of Governors of the Federal Reserve System (the "Federal Reserve")
to do so if then required under applicable capital guidelines or policies of the
Federal Reserve). The Capital Securities will have a preference under certain
circumstances with respect to cash distributions and amounts payable on
liquidation, redemption or otherwise over the Common Securities, which will be
held by the Company. See "Description of the Capital Securities -- Subordination
of Common Securities of CFB Capital Held by the Company."

(CONTINUED ON NEXT PAGE)

SEE "RISK FACTORS" COMMENCING ON PAGE 13 HEREIN FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.

THESE SECURITIES ARE NOT SAVINGS ACCOUNTS OR DEPOSITS AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, BY ANY OTHER GOVERNMENTAL AGENCY, OR
OTHERWISE.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
Price to Underwriting Proceeds to
Public Commission (1) CFB Capital (2)(3)
<S> <C> <C> <C>
Per Capital Security.................. $25.00 (2) $
Total................................. $ (2) $
</TABLE>

(1) The Company and CFB Capital have agreed to indemnify the Underwriters
against certain liabilities, including liabilities under the Securities Act
of 1933, as amended. See "Underwriting."

(2) In view of the fact that all of the proceeds of the sale of the Capital
Securities will be used to purchase the Junior Subordinated Debentures, the
Company has agreed to pay the Underwriters as compensation for arranging the
investment therein of such proceeds, $ per Capital Security, or $ in
the aggregate. See "Underwriting."

(3) Before deducting offering expenses payable by the Company estimated at
$215,000.

The Capital Securities are being offered by the Underwriters named herein
subject to prior sale and when, as and if delivered to and accepted by the
Underwriters. It is expected that the Capital Securities will be ready for
delivery in book-entry form only through the facilities of The Depository Trust
Company in New York, New York, on or about , 1997, against payment
therefor in immediately available funds.

PIPER JAFFRAY INC.
DAIN BOSWORTH
INCORPORATED
<PAGE>
(CONTINUED FROM PREVIOUS PAGE)

Holders of the Capital Securities will be entitled to receive preferential
cumulative cash distributions accruing from the date of original issuance and
payable quarterly in arrears on the 15th day of April, July, October and January
of each year (subject to possible deferral as described below), commencing April
15, 1997, at the annual rate of % of the Liquidation Amount of $25 per
Capital Security ("Distributions"). The amount of each distribution due with
respect to the Capital Securities will include amounts accrued through the date
the distribution payment is due. The Company will have the right to defer
payments of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 20 consecutive quarters with respect to
each deferral period (each, an "Extension Period"), provided that no Extension
Period may extend beyond the Stated Maturity of the Junior Subordinated
Debentures. Upon the termination of any such Extension Period and the payment of
all amounts then due, the Company may elect to begin a new Extension Period
subject to the requirements set forth herein. If interest payments on the Junior
Subordinated Debentures are so deferred, Distributions on the Capital Securities
will also be deferred and the Company will not be permitted, subject to certain
exceptions described herein, to declare or pay any cash distributions with
respect to its capital stock or to make any payment with respect to its debt
securities that rank PARI PASSU with or junior to the Junior Subordinated
Debentures. During an Extension Period, interest on the Junior Subordinated
Debentures will continue to accrue (and the amount of Distributions to which
holders of the Capital Securities are entitled will accumulate) at the rate of
% per annum, compounded quarterly, and holders of the Capital Securities will
be required to accrue income and will be required to pay United States federal
income tax on that income. See "Description of Junior Subordinated Debentures --
Option to Extend Interest Payment Period" and "Certain Federal Income Tax
Consequences -- Interest Income and Original Issue Discount."

The Company has, through the Guarantee, Trust Agreement, Junior Subordinated
Debentures, Indenture and the Expense Agreement (each as defined herein), taken
together, fully, irrevocably and unconditionally guaranteed all of CFB Capital's
obligations under the Capital Securities. See "Relationship Among the Capital
Securities, the Junior Subordinated Debentures and the Guarantee -- Full and
Unconditional Guarantee." Under the Guarantee, the Company guarantees the
payment of Distributions by CFB Capital and payments on liquidation of or
redemption of the Capital Securities (subordinate to the right to payment of
Senior and Subordinated Debt of the Company, as defined herein) to the extent of
funds held by CFB Capital. The Guarantee does not cover payment of Distributions
when CFB Capital does not have sufficient funds to pay such Distributions. See
"Description of Guarantee." If the Company does not make required payments on
the Junior Subordinated Debentures held by CFB Capital, CFB Capital will have
insufficient funds to pay Distributions on the Capital Securities. In such
event, a holder of the Capital Securities may institute a legal proceeding
directly against the Company to enforce payment of such Distributions to such
holder. See "Description of Junior Subordinated Debentures -- Enforcement of
Certain Rights by Holders of the Capital Securities." The obligations of the
Company under the Guarantee and the Junior Subordinated Debentures are
subordinate and junior in right of payment to all Senior and Subordinated Debt
(as defined in "Description of Junior Subordinated Debentures -- Subordination")
of the Company.

The Capital Securities are subject to mandatory redemption, in whole or in part,
upon repayment of the underlying Junior Subordinated Debentures at maturity or
to the extent of their earlier redemption in an amount equal to the amount of
Junior Subordinated Debentures maturing or being redeemed. The redemption price
will equal the aggregate liquidation preference of the Capital Securities plus
any accumulated and unpaid Distributions thereon to the date of redemption. The
Junior Subordinated Debentures are redeemable prior to maturity at the option of
the Company, subject to any required prior approval of the Federal Reserve, (i)
on or after February 1, 2002, in whole at any time or in part from time to time,
or (ii) at any time, in whole (but not in part), upon the occurrence and
continuation of a Tax Event, an Investment Company Event or a Capital Treatment
Event (each as defined herein), in each case at a redemption price equal to the
accrued and unpaid interest on the Junior Subordinated Debentures to the date
fixed for redemption, plus 100% of the principal amount thereof. See
"Description of the Capital Securities -- Redemption."

(CONTINUED ON NEXT PAGE)

2
<PAGE>
(CONTINUED FROM PREVIOUS PAGE)

The Company will have the right at any time to terminate CFB Capital and cause
the Junior Subordinated Debentures to be distributed to the holders of the Trust
Securities in liquidation of CFB Capital, subject to the Company having received
prior approval of the Federal Reserve if required. See "Description of the
Capital Securities -- Redemption." The Junior Subordinated Debentures are
unsecured and subordinated to all Senior and Subordinated Debt. As of September
30, 1996, after giving effect to the Company's acquisition of Mountain Parks
Financial Corp. (see "Prospectus Summary -- The Company" and "Recent
Developments"), the Company had approximately $38.9 million aggregate principal
amount of Senior and Subordinated Debt outstanding. The terms of the Junior
Subordinated Debentures place no limitation on the amount of Senior and
Subordinated Debt that the Company can issue. See "Description of Junior
Subordinated Debentures -- Subordination."

In the event of the termination of CFB Capital, after satisfaction of
liabilities to creditors of CFB Capital as required by applicable law, the
holders of Capital Securities will be entitled to receive a liquidation amount
of $25 per Capital Security ("Liquidation Amount"), plus accumulated and unpaid
Distributions thereon to the date of payment, which may be in the form of a
distribution of such Like Amount (as defined herein) of Junior Subordinated
Debentures, subject to certain exceptions. See "Description of the Capital
Securities -- Liquidation Distribution Upon Termination."

The Capital Securities have been approved for listing on the Nasdaq National
Market. Although the Underwriters have indicated an intention to make a market
in the Capital Securities, the Underwriters are not obligated to make a market
in the Capital Securities, and any market making may be discontinued at any time
at the sole discretion of such Underwriters. There can be no assurance that a
market will develop for the Capital Securities. See "Risk Factors -- Absence of
Existing Public Market" and "Underwriting."

The Capital Securities will be represented by one or more global certificates
registered in the name of The Depository Trust Company (the "Depositary") or its
nominee. Beneficial interests in the Capital Securities will be shown on, and
transfers thereof will be effected only through, records maintained by
participants in the Depositary. Except as described herein, the Capital
Securities in certificate form will not be issued in exchange for global
certificates. See "Book-Entry Issuance."

AS USED HEREIN, (I) THE "INDENTURE" MEANS THE SUBORDINATED INDENTURE DATED AS OF
FEBRUARY , 1997, AS AMENDED AND SUPPLEMENTED FROM TIME TO TIME, BETWEEN THE
COMPANY AND WILMINGTON TRUST COMPANY AS TRUSTEE (THE "INDENTURE TRUSTEE"), UNDER
WHICH THE JUNIOR SUBORDINATED DEBENTURES WILL BE ISSUED, AND (II) THE "PROPERTY
TRUSTEE" AND "DELAWARE TRUSTEE" UNDER THE TRUST AGREEMENT EXECUTED BY THE
COMPANY, AS DEPOSITOR, WILMINGTON TRUST COMPANY, AS TRUSTEE, AND THE
ADMINISTRATIVE TRUSTEES NAMED THEREIN, TO BE AMENDED AND RESTATED PURSUANT TO AN
AMENDED AND RESTATED TRUST AGREEMENT EXECUTED BY SUCH PARTIES (AS AMENDED AND
RESTATED, THE "TRUST AGREEMENT") SHALL MEAN WILMINGTON TRUST COMPANY.

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

Information included or incorporated by reference in this Prospectus includes
"forward looking statements," which can be identified by the use of
forward-looking terminology such as "may," "will," "expect," "anticipate,"
"estimate," or "continue," or the negative thereof or other variations thereon
or comparable terminology. The statements in "Risk Factors" beginning on page 13
of the Prospectus and other statements and disclaimers in the Prospectus
constitute cautionary statements identifying important factors, including
certain risks and uncertainties, with respect to such forward-looking statements
that could cause actual results to differ materially from those reflected in
such forward-looking statements.

3
<PAGE>
AVAILABLE INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-3 under the Securities Act of
1933, as amended (the "Securities Act"), with respect to the offering of the
securities offered hereby. This Prospectus does not contain all of the
information set forth in such Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the Commission.

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. Reports, proxy statements and other information filed by the Company
can be inspected and copies of such material can be obtained at prescribed rates
from the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Room 1024, Judiciary Plaza, Washington, D.C. 20549, and at the following
Regional Offices of the Commission: Chicago Regional Office, Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and New York
Regional Office, 7 World Trade Center, Suite 1300, New York, New York 10048. The
Commission also maintains a Web site (http://www.sec.gov) at which reports,
proxy and information statements and other information regarding the Company may
be accessed. In addition, such reports, proxy statements and other information
can also be inspected at the offices of The Nasdaq Stock Market, 1735 K Street,
N.W., Washington, D.C. 20006.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents filed by the Company with the Commission are
incorporated by reference in this Prospectus:

(i) The Company's Annual Report on Form 10-K for the year ended December
31, 1995;

(ii) The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, June 30 and September 30, 1996; and

(iii) The Company's Current Reports on Form 8-K filed with the Commission
on October 18, 1996, January 2, 1997 (as amended on Form 8-K/A filed on
January 16, 1997) and January 28, 1997.

All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of this offering shall be deemed to be incorporated by reference
into this Prospectus and to be a part hereof from the date of filing of such
documents. Any statement contained herein or in a document incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed to constitute a part of this
Prospectus, except as so modified or superseded.

The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, upon the oral or written request of any such
person, a copy of all documents which are incorporated by reference in this
Prospectus, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference in such documents). Requests for such
copies should be directed to Mark A. Anderson, Executive Vice President,
Community First Bankshares, Inc., 520 Main Avenue, Fargo, North Dakota
58124-0001, telephone number (701) 298-5600.
------------------------

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY EFFECT TRANSACTIONS WHICH
STABILIZE OR MAINTAIN THE MARKET PRICE OF THE CAPITAL SECURITIES ON THE NASDAQ
NATIONAL MARKET OR OTHERWISE, AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE
PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED
AT ANY TIME.

4
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PROSPECTUS SUMMARY

THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION AND CONSOLIDATED FINANCIAL INFORMATION APPEARING ELSEWHERE IN THIS
PROSPECTUS OR IN THE DOCUMENTS INCORPORATED INTO THIS PROSPECTUS BY REFERENCE.
UNLESS THE CONTEXT CLEARLY SUGGESTS OTHERWISE, (I) REFERENCES TO THE COMPANY
INCLUDE THE COMPANY AND ITS SUBSIDIARIES AND (II) THE HISTORICAL FINANCIAL AND
BUSINESS INFORMATION OF THE COMPANY HAS BEEN RESTATED TO REFLECT THE ACQUISITION
OF MOUNTAIN PARKS FINANCIAL CORP. SEE "RECENT DEVELOPMENTS."

THE COMPANY

Community First Bankshares, Inc., a Delaware corporation (the "Company"), is
a multi-bank holding company that as of September 30, 1996 operated banks and
bank branches (the "Company Banks") in 79 communities in Colorado, Iowa,
Minnesota, Nebraska, North Dakota, South Dakota and Wisconsin and had total
assets of approximately $3.0 billion. The Company operates community banks
primarily in small and medium-sized communities and the surrounding market
areas. The Company provides a full range of financial products and services to
individuals and businesses, including commercial and consumer banking, trust,
insurance and investments.

The Company's primary strategy is to operate and continue to acquire banks
and bank branches with approximately $20 million to $150 million in assets in
each of the Company's selected communities, which communities generally have
populations between 3,000 and 50,000 and are located in the key target
acquisition states of Colorado, Iowa, Kansas, Minnesota, Montana, Nebraska,
North Dakota, South Dakota, Wisconsin, and Wyoming, and additionally in the
adjacent states of Idaho, Illinois, Missouri, New Mexico, Oklahoma and Utah
(this sixteen state area is collectively referred to as the "Acquisition Area").
Such communities are believed to provide the Company with a stable, relatively
low-cost deposit base.

On December 18, 1996, the Company acquired Mountain Parks Financial Corp.
("Mountain Parks"), a bank holding company that operated a state chartered bank
with full service commercial banking facilities in 17 Colorado communities (the
bank and its branches are referred to as the "Mountain Parks Banks"). At
September 30, 1996, Mountain Parks had total assets of approximately $581.8
million. The Mountain Parks Banks are located in winter ski and summer
recreational areas in the Colorado mountains and in the greater Denver/Boulder
metropolitan area. As part of the acquisition of Mountain Parks, the Company
also acquired (i) an 85% interest in Equity Lending, Inc., a specialty consumer
mortgage company involved in originating, owning and servicing non-conforming
residential mortgages in Arizona, Colorado, Minnesota and Wisconsin, and (ii)
Mountain Parks Financial Services, Inc., a consumer finance company located in
Denver, Colorado that focuses on the purchase, origination and servicing of
consumer installment contracts, primarily sub-prime auto contracts. On January
3, 1997, the Company acquired the remaining 15% ownership in Equity Lending,
Inc. See "Recent Developments."

On October 1, 1996, the Company acquired Financial Bancorp, Inc. ("Financial
Bancorp"), a bank holding company located in Trinidad, Colorado. Financial
Bancorp owned all of the outstanding capital stock of Trinidad National Bank
(the "Trinidad Bank"). At September 30, 1996, Financial Bancorp had consolidated
total assets of approximately $69.5 million. The Trinidad Bank is a community
bank in southeastern Colorado that serves a wide range of commercial,
agricultural and consumer banking needs within its market. See "Recent
Developments."

The Company provides its banks (which include the Mountain Parks Banks and
the Trinidad Bank) with the advantages of affiliation with a multi-bank holding
company, such as data processing services, credit policy formulation and review,
investment management and specialized staff support, while granting substantial
autonomy to managers of the Company Banks with respect to day-to-day operations,
customer service decisions and marketing. The Company Banks are encouraged to
participate in community activities, support local charities and community
development, and otherwise to serve their communities.

The Company's principal executive offices are located at 520 Main Avenue,
Fargo, North Dakota 58124-0001 and its telephone number is (701) 298-5600. The
Company also maintains a Web site at http:// www.cfbx.com.

5
<PAGE>
CFB CAPITAL

CFB Capital is a statutory business trust formed under Delaware law pursuant
to (i) the Trust Agreement and (ii) the filing of a certificate of trust with
the Delaware Secretary of State on January 14, 1997. CFB Capital's business and
affairs are conducted by the Property Trustee, Delaware Trustee and three
individual Administrative Trustees who are officers of the Company. CFB Capital
exists for the exclusive purposes of (i) issuing and selling the Trust
Securities, (ii) using the proceeds from the sale of the Trust Securities to
acquire the Junior Subordinated Debentures issued by the Company, and (iii)
engaging in only those other activities necessary, advisable or incidental
thereto (such as registering the transfer of the Trust Securities). Accordingly,
the Junior Subordinated Debentures will be the sole assets of CFB Capital, and
payments by the Company under the Junior Subordinated Debentures and the Expense
Agreement will be the sole revenues of CFB Capital. All of the Common Securities
will be owned by the Company. The Common Securities will rank PARI PASSU, and
payments will be made thereon pro rata, with the Capital Securities, except that
upon the occurrence and during the continuance of an event of default under the
Trust Agreement resulting from an event of default under the Indenture, the
rights of the Company as holder of the Common Securities to payment in respect
of Distributions and payments upon liquidation, redemption or otherwise will be
subordinated to the rights of the holders of the Capital Securities. See
"Description of the Capital Securities -- Subordination of Common Securities of
CFB Capital Held by the Company." The Company will acquire Common Securities in
an aggregate liquidation amount equal to 3% of the total capital of CFB Capital.
CFB Capital has a term of 31 years, but may terminate earlier as provided in the
Trust Agreement.

CFB Capital's principal executive offices are located at 520 Main Avenue,
Fargo, North Dakota 58124-0001 and its telephone number is (701) 298-5600.

THE OFFERING

<TABLE>
<S> <C>
Capital Securities issuer......... CFB Capital

Securities offered................ 2,400,000 Capital Securities. The Capital Securities
represent undivided beneficial interests in CFB
Capital's assets, which will consist solely of the
Junior Subordinated Debentures and payments thereunder.

Distributions..................... The Distributions payable on each Capital Security will
be fixed at a rate per annum of % of the Liquidation
Amount of $25 per Capital Security, will be cumulative,
will accrue from the date of issuance of the Capital
Securities, and will be payable quarterly in arrears on
the 15th day of April, July, October and January of each
year, commencing on April 15, 1997 (subject to possible
deferral as described below). The amount of each
distribution due with respect to the Capital Securities
will include amounts accrued through the date the
distribution payment is due. See "Description of the
Capital Securities -- Distributions."

Extension periods................. So long as no Debenture Event of Default (as defined
herein) has occurred and is continuing, the Company will
have the right, at any time, to defer payments of
interest on the Junior Subordinated Debentures by
extending the interest payment period thereon for a
period not exceeding 20 consecutive quarters with
respect to each deferral period (each an "Extension
Period"), provided that no Extension Period may extend
beyond the Stated Maturity of the Junior Subordinated
Debentures. If interest payments are so deferred,
Distributions on the Capital
</TABLE>

6
<PAGE>

<TABLE>
<S> <C>
Securities will also be deferred and the Company will
not be permitted, subject to certain exceptions
described herein, to declare or pay any cash
distributions with respect to the Company's capital
stock or debt securities that rank PARI PASSU with or
junior to the Junior Subordinated Debentures. During an
Extension Period, Distributions will continue to accrue
with income thereon compounded quarterly. Because
interest would continue to accrue and compound on the
Junior Subordinated Debentures, to the extent permitted
by applicable law, holders of the Capital Securities
will be required to accrue income for United States
federal income tax purposes. See "Description of Junior
Subordinated Debentures -- Option to Extend Interest
Payment Period" and "Certain Federal Income Tax
Consequences -- Interest Income and Original Issue
Discount."

Maturity.......................... The Junior Subordinated Debentures will mature on
February 1, 2027, which date may be shortened (such
date, as it may be shortened, the "Stated Maturity") to
a date not earlier than February 1, 2002 if certain
conditions are met (including the Company having
received prior approval of the Federal Reserve to do so
if then required under applicable capital guidelines or
policies of the Federal Reserve).

Redemption........................ The Capital Securities are subject to mandatory
redemption upon repayment of the Junior Subordinated
Debentures at maturity or their earlier redemption in an
amount equal to the amount of Junior Subordinated
Debentures maturing on or being redeemed at a redemption
price equal to the aggregate Liquidation Amount of the
Capital Securities plus accumulated and unpaid
Distributions thereon to the date of redemption. Subject
to Federal Reserve approval, if then required under
applicable capital guidelines or policies of the Federal
Reserve, the Junior Subordinated Debentures are
redeemable prior to maturity at the option of the
Company (i) on or after February 1, 2002, in whole at
any time or in part from time to time, or (ii) at any
time, in whole (but not in part), upon the occurrence
and during the continuance of a Tax Event, an Investment
Company Event or a Capital Treatment Event, in each case
at a redemption price equal to 100% of the principal
amount of the Junior Subordinated Debentures so
redeemed, together with any accrued but unpaid interest
to the date fixed for redemption. See "Description of
the Capital Securities -- Redemption" and "Description
of Junior Subordinated Debentures -- Redemption."

Distribution of Junior
Subordinated Debentures.......... The Company has the right at any time to terminate CFB
Capital and cause the Junior Subordinated Debentures to
be distributed to holders of Capital Securities in
liquidation of CFB Capital, subject to the Company
having received prior approval of the Federal Reserve to
do so if then required under applicable capital
</TABLE>

7
<PAGE>

<TABLE>
<S> <C>
guidelines or policies of the Federal Reserve. See
"Description of the Capital Securities -- Distribution
of Junior Subordinated Debentures."

Guarantee......................... Taken together, the Company's obligations under various
documents described herein, including the Guarantee,
provide a full guarantee of payments by CFB Capital of
distributions and other amounts due on the Capital
Securities. Under the Guarantee, the Company guarantees
the payment of Distributions by CFB Capital and payments
on liquidation of or redemption of the Capital
Securities (subordinate to the right to payment of
Senior and Subordinated Debt of the Company, as defined
herein) to the extent of funds held by CFB Capital. If
CFB Capital has insufficient funds to pay Distributions
on the Capital Securities (i.e., if the Company has
failed to make required payments under the Junior
Subordinated Debentures), a holder of the Capital
Securities would have the right to institute a legal
proceeding directly against the Company to enforce
payment of such Distributions to such holder. See
"Description of Junior Subordinated Debentures --
Enforcement of Certain Rights of Holders of the Capital
Securities," "Description of Junior Subordinated
Debentures -- Debenture Events of Default" and
"Description of Guarantee."

Ranking........................... The Capital Securities will rank PARI PASSU, and
payments thereon will be made pro rata, with the Common
Securities of CFB Capital held by the Company, except as
described under "Description of the Capital Securities
-- Subordination of Common Securities of CFB Capital
Held by the Company." The obligations of the Company
under the Guarantee, the Junior Subordinated Debentures
and other documents described herein are unsecured and
rank subordinate and junior in right of payment to all
current and future Senior and Subordinated Debt, the
amount of which is unlimited. At September 30, 1996, the
aggregate outstanding Senior and Subordinated Debt of
the Company was approximately $38.9 million. In
addition, because the Company is a holding company, all
obligations of the Company relating to the securities
described herein will be effectively subordinated to all
existing and future liabilities of the Company's
subsidiaries, including the Company Banks. The Company
may cause additional capital securities to be issued by
trusts similar to CFB Capital in the future, and there
is no limit on the amount of such securities that may be
issued. In this event, the Company's obligations under
the junior subordinated debentures to be issued to such
other trusts and the Company's guarantees of the
payments by such trusts will rank PARI PASSU with the
Company's obligations under the Junior Subordinated
Debentures and the Guarantee, respectively.

Voting Rights..................... The holders of the Capital Securities will generally
have limited voting rights relating only to the
modification of the Capital Securities, the dissolution,
winding-up or termination of CFB
</TABLE>

8
<PAGE>

<TABLE>
<S> <C>
Capital and certain other matters described herein. See
"Description of the Capital Securities -- Voting Rights;
Amendment of Trust Agreement."

Nasdaq National Market Symbol..... CFBXL

Use of Proceeds................... The proceeds to CFB Capital from the sale of the Capital
Securities offered hereby will be invested by CFB
Capital in the Junior Subordinated Debentures of the
Company. The Company intends to use the net proceeds
from the issuance of the Junior Subordinated Debentures
for general corporate purposes, which may include
without limitation possible future acquisitions, funding
investments in, or extension of credit to, the Company's
subsidiaries, repayment of maturing obligations and
redemption of securities. The Company expects the
Capital Securities to qualify as Tier 1 capital under
the capital guidelines of the Federal Reserve. See "Use
of Proceeds."
</TABLE>

9
<PAGE>
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL DATA

The following table sets forth certain consolidated financial data
concerning the Company. The summary financial data for each of the five years
ended December 31, 1995 is derived from the audited consolidated financial
statements of the Company, and related notes thereto, incorporated by reference
in this document. The financial data as of and for the nine months ended
September 30, 1996 and 1995 have been derived from the Company's unaudited
financial statements. The financial statements from which this data has been
derived have been restated to reflect the Company's acquisition of Mountain
Parks, which occurred on December 18, 1996 and was accounted for as a pooling of
interests. The information below has not been restated to reflect the
acquisition of Financial Bancorp on the basis that the effect of that
acquisition is not material to this information. The unaudited financial
statements reflect, in the opinion of management, all adjustments of a normal
recurring nature necessary for a fair presentation of financial condition and
results of operations. The results for the nine months ended September 30, 1996
are not necessarily indicative of the results to be expected for the entire
year. This information should be read in conjunction with the consolidated
financial statements of the Company, and the related notes thereto, and
Management's Discussion and Analysis of Financial Condition and Results of
Operations included in the Company's Form 8-K/A filed with the Commission on
January 16, 1997 and incorporated by reference herein.

OPERATING DATA:
Interest income................... $ 167,912 $ 138,488 $ 192,868 $ 143,237 $ 121,146 $ 115,309 $ 120,012
Interest expense.................. 69,524 59,725 82,891 53,468 47,271 50,870 64,522
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net interest income............... 98,388 78,763 109,977 89,769 73,875 64,439 55,490
Provision for loan losses......... 4,572 1,929 2,711 1,839 2,149 2,433 3,427
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net interest income after
provision for loan losses........ 93,816 76,834 107,266 87,930 71,726 62,006 52,063
Noninterest income................ 19,132 16,329 22,488 18,992 18,158 14,640 11,931
Noninterest expense............... 72,491 59,536 82,593 70,241 60,854 52,992 45,427
----------- ----------- ----------- ----------- ----------- ----------- -----------
Income before income taxes,
extraordinary item and cumulative
effect of accounting change...... 40,457 33,627 47,161 36,681 29,030 23,654 18,567
Provision for income taxes........ 13,995 12,298 17,208 13,952 10,775 8,546 6,285
----------- ----------- ----------- ----------- ----------- ----------- -----------
Income before extraordinary item
and cumulative effect of
accounting change................ 26,462 21,329 29,953 22,729 18,255 15,108 12,282
Extraordinary item (1)............ -- -- -- -- -- -- (653)
Cumulative effect of accounting
change........................... -- -- -- -- 359 -- --
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net income........................ 26,462 21,329 29,953 22,729 18,614 15,108 11,629
Dividends on preferred stock...... 1,208 1,208 1,610 1,091 -- -- 655
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net income applicable to common
equity........................... $ 25,254 $ 20,121 $ 28,343 $ 21,638 $ 18,614 $ 15,108 $ 10,974
----------- ----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- ----------- -----------
Earnings per common and common
equivalent share:
Primary earnings per share
before extraordinary item and
cumulative effect of accounting
change......................... $ 1.53 $ 1.32 $ 1.82 $ 1.48 $ 1.29 $ 1.07 $ 0.92
Extraordinary item (1).......... -- -- -- -- -- -- (0.05)
Cumulative effect of accounting
change......................... -- -- -- -- 0.03 -- --
Primary earnings per share...... $ 1.53 $ 1.32 $ 1.82 $ 1.48 $ 1.32 $ 1.07 $ 0.87
Fully diluted earnings per share
before extraordinary item and
cumulative effect of accounting
change......................... $ 1.47 $ 1.26 $ 1.74 $ 1.42 $ 1.27 $ 1.07 $ 0.92
Extraordinary item (1).......... -- -- -- -- -- -- (0.05)
Cumulative effect of accounting
change......................... -- -- -- -- 0.03 -- --
Fully diluted earnings per
share.......................... $ 1.47 $ 1.26 $ 1.74 $ 1.42 $ 1.30 $ 1.07 $ 0.87
Average common and common
equivalent shares outstanding:
Primary......................... 16,532,714 15,280,976 15,543,129 14,580,309 14,098,585 14,080,526 12,621,595
Fully diluted................... 17,992,255 17,049,679 17,276,050 16,136,433 14,396,532 14,087,606 12,621,595
</TABLE>

10
<PAGE>

<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30 YEAR ENDED DECEMBER 31
------------------------ ---------------------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
----------- ----------- ----------- ----------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
OPERATING RATIOS AND OTHER DATA:
Return on average assets (2)...... 1.26% 1.23% 1.24% 1.13% 1.10% 1.04% 0.88%
Return on average common
shareholders' equity (2)......... 17.73% 18.30% 18.19% 16.77% 16.64% 15.10% 13.90%
Net interest margin (2)........... 5.32% 5.05% 5.06% 4.95% 4.74% 4.85% 4.61%
Net charge-offs to average loans
(2).............................. 0.15% 0.12% 0.17% -- 0.08% 0.33% 0.55%
Ratio of earnings to fixed
charges (3):
Excluding interest on
deposits....................... 4.58x 4.29x 4.46x 5.23x 7.60x 8.53x 4.30x
Including interest on
deposits....................... 1.57x 1.55x 1.55x 1.66x 1.61x 1.46x 1.28x

FINANCIAL CONDITION DATA:
Assets............................ $ 2,999,736 $ 2,632,669 $ 2,769,976 $ 2,130,619 $ 1,883,794 $ 1,576,275 $ 1,414,860
Loans............................. 1,976,592 1,695,933 1,767,193 1,330,146 1,037,666 813,550 685,053
Investment securities (4)......... 736,270 699,967 717,342 613,239 653,722 579,078 554,115
Deposits.......................... 2,424,315 2,189,725 2,359,716 1,794,565 1,627,989 1,374,859 1,239,421
Long-term debt.................... 38,898 81,724 81,288 38,092 48,354 18,015 17,872
Preferred shareholders' equity.... 22,997 23,000 23,000 23,000 -- -- --
Common shareholders' equity....... 203,782 173,139 181,004 134,701 123,757 103,911 93,247
Book value per common share....... 12.39 10.77 11.25 9.23 8.68 7.64 6.94
Tangible book value per common
share............................ 10.16 8.83 9.08 8.09 7.84 7.01 6.60

FINANCIAL CONDITION RATIOS:
Nonperforming assets to total
loans and OREO................... 0.42% 0.33% 0.31% 0.34% 0.62% 1.13% 1.34%
Allowance for loan losses to total
loans............................ 1.30% 1.36% 1.29% 1.30% 1.38% 1.38% 1.53%
Allowance for loan losses to
nonperforming loans.............. 416% 576% 608% 537% 296% 224% 205%

REGULATORY CAPITAL RATIOS:
Tier 1 capital.................... 8.48% 8.66% 8.51% 10.64% 10.16% 10.97% 11.59%
Total capital..................... 10.77% 11.69% 11.18% 13.46% 13.44% 12.47% 13.29%
Leverage ratio.................... 6.35% 6.27% 6.10% 7.12% 6.12% 6.40% 6.69%
</TABLE>

- ------------------------------
(1) Represents the after-tax effect of prepayment penalties and unamortized debt
issuance costs in connection with redemption of certain indebtedness.

(2) Annualized for the nine months ended September 30, 1996 and 1995.

(3) For purposes of computing the ratio of earnings to fixed charges, earnings
represent income before income taxes, extraordinary items and fixed charges.
Fixed charges represent interest expense, including the interest component
of rental expense, and preferred stock dividends. Fixed charges attributable
to the preferred stock dividends are assumed to equal the amount of pre-tax
income that would be necessary to pay such dividends.

(4) Includes available-for-sale securities and held-to-maturity securities.

11
<PAGE>
[COMMUNITY FIRST LOGO AND MAP]

Community Banking Locations

Map of the United States indicating the Company's banking locations, the
locations of other Company offices and the locations of the Company's key
acquisition states and acquisition prospect states.

12
<PAGE>
RISK FACTORS

PROSPECTIVE INVESTORS SHOULD CONSIDER, AMONG OTHER THINGS, THE FOLLOWING
FACTORS IN CONNECTION WITH A DECISION TO PURCHASE THE CAPITAL SECURITIES.

RANKING OF THE COMPANY'S OBLIGATIONS UNDER THE JUNIOR SUBORDINATED DEBENTURES
AND THE GUARANTEE

The ability of CFB Capital to pay amounts due to holders of the Capital
Securities is solely dependent upon the Company making payments on the Junior
Subordinated Debentures as and when required. All obligations of the Company
under the Guarantee, the Junior Subordinated Debentures and other documents
described herein are unsecured and rank subordinate and junior in right of
payment to all current and future Senior and Subordinated Debt, the amount of
which is unlimited. At September 30, 1996, the aggregate outstanding Senior and
Subordinated Debt of the Company was approximately $38.9 million. In addition,
because the Company is a holding company, all obligations of the Company
relating to the securities described herein will be effectively subordinated to
all existing and future liabilities of the Company's subsidiaries, including the
Company Banks. As a holding company, the right of the Company to participate in
any distribution of assets of any subsidiary upon such subsidiary's liquidation
or reorganization or otherwise (and thus the ability of holders of the Capital
Securities to benefit indirectly from such distribution) is subject to the prior
claims of creditors of that subsidiary, except to the extent that the Company
may itself be recognized as a creditor of that subsidiary. Accordingly, holders
of the Capital Securities should look only to the assets of the Company, and not
of its subsidiaries, for principal and interest payments on the Junior
Subordinated Debentures. None of the Indenture, the Guarantee or the Trust
Agreement places any limitation on the amount of secured or unsecured debt,
including Senior and Subordinated Debt, that may be incurred by the Company or
its subsidiaries. Further, there is no limitation on the Company's ability to
issue additional junior subordinated debentures in connection with any further
offerings of capital securities, and such additional debentures that would rank
PARI PASSU with the Junior Subordinated Debentures. See "Description of Junior
Subordinated Debentures -- Subordination" and "Description of Guarantee --
Status of the Guarantee."

DEPENDENCE ON DIVIDENDS FROM SUBSIDIARY BANKS

As a holding company, with the substantial majority of its assets
represented by its equity interest in its subsidiary banks, the Company's
ability to pay interest on the Junior Subordinated Debentures to CFB Capital
(and consequently CFB Capital's ability to pay Distributions on the Capital
Securities and the Company's ability to pay its obligations on the Guarantee)
depends primarily upon the cash dividends the Company receives from the
subsidiary banks. Dividend payments from the subsidiary banks are subject to
regulatory limitations, generally based on current and retained earnings,
imposed by the various regulatory agencies with authority over the respective
subsidiary banks. Payment of dividends is also subject to regulatory
restrictions if such dividends would impair the capital of the subsidiary banks.
Payment of subsidiary bank dividends is also subject to the bank's
profitability, financial condition and capital expenditures and other cash flow
requirements. No assurance can be given that the subsidiary banks will be able
to pay dividends at past levels, or at all, in the future.

OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSEQUENCES OF A DEFERRAL OF
INTEREST PAYMENTS

So long as no Debenture Event of Default (as defined herein) has occurred
and is continuing, the Company has the right under the Indenture to defer the
payment of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 20 consecutive quarters with respect to
each Extension Period, provided that no Extension Period may extend beyond the
Stated Maturity of the Junior Subordinated Debentures. As a consequence of any
such deferral, quarterly Distributions on the Capital Securities by CFB Capital
will be deferred (and the amount of Distributions to which holders of the
Capital Securities are entitled will accumulate additional amounts thereon at
the rate of % per annum, compounded quarterly, from the relevant payment
date for such Distributions, to the extent permitted by applicable law) during
any such Extension Period. During any such Extension Period, the Company will be
prohibited from making certain payments or distributions with respect to the
Company's capital stock

13
<PAGE>
(including dividends on or redemptions of common or preferred stock) and from
making certain payments with respect to any debt securities of the Company that
rank PARI PASSU with or junior in interest to the Junior Subordinated
Debentures; however, the Company will NOT be restricted from (a) paying
dividends or distributions in common stock of the Company, (b) redeeming rights
or taking certain other actions under a stockholders' rights plan, (c) making
payments under the Guarantee or (d) making purchases of common stock related to
the issuance of common stock or rights under any of the Company's benefit plans
for its directors, officers or employees. Further, during an Extension Period,
the Company would have the ability to continue to make payments on Senior and
Subordinated Debt. Prior to the termination of any Extension Period, the Company
may further extend such Extension Period provided that such extension does not
cause such Extension Period to exceed 20 consecutive quarters or to extend
beyond the Stated Maturity. Upon the termination of any Extension Period and the
payment of all interest then accrued and unpaid (together with interest thereon
at the annual rate of %, compounded quarterly, to the extent permitted by
applicable law), the Company may elect to begin a new Extension Period subject
to the above requirements. There is no limitation on the number of times that
the Company may elect to begin an Extension Period. See "Description of the
Capital Securities -- Distributions" and "Description of Junior Subordinated
Debentures -- Option to Extend Interest Payment Period."

Because the Company believes the likelihood of it exercising its option to
defer payments of interest is remote, the Junior Subordinated Debentures will be
treated as issued without "original issue discount" for United States federal
income tax purposes. As a result, holders of Capital Securities will include
interest in taxable income under their own methods of accounting (i.e., cash or
accrual). If the Company exercises its right to defer payments of interest, the
holders of Capital Securities will be required to include their pro rata share
of original issue discount in gross income as it accrues for United States
federal income tax purposes in advance of the receipt of cash. See "Certain
Federal Income Tax Consequences -- Potential Extension of Interest Payment
Period and Original Issue Discount." The Company has no current intention of
exercising its right to defer payments of interest by extending the interest
payment period on the Junior Subordinated Debentures. However, should the
Company elect to exercise its right to defer payments of interest in the future,
the market price of the Capital Securities is likely to be adversely affected. A
holder that disposes of such holder's Capital Securities during an Extension
Period, therefore, might not receive the same return on such holder's investment
as a holder that continues to hold the Capital Securities.

TAX EVENT REDEMPTION, INVESTMENT COMPANY ACT REDEMPTION OR CAPITAL TREATMENT
EVENT REDEMPTION

Upon the occurrence and during the continuation of a Tax Event, an
Investment Company Event or a Capital Treatment Event (whether occurring before
or after February 1, 2002), the Company has the right to redeem the Junior
Subordinated Debentures in whole (but not in part) at 100% of the principal
amount together with accrued but unpaid interest to the date fixed for
redemption within 90 days following the occurrence of such Tax Event, Investment
Company Event or Capital Treatment Event and therefore cause a mandatory
redemption of the Trust Securities. The exercise of such right is subject to the
Company having received prior approval of the Federal Reserve to do so if then
required under applicable guidelines or policies of the Federal Reserve. See
"Description of the Capital Securities -- Redemption."

A "Tax Event" means the receipt by the Company and CFB Capital of an opinion
of counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement or decision is announced on or after the original issuance of
the Capital Securities, there is more than an insubstantial risk that (i) CFB
Capital is, or will be within 90 days of the date of such opinion, subject to
United States federal income tax with respect to income received or accrued on
the Junior Subordinated Debentures, (ii) interest payable by the Company on the
Junior Subordinated Debentures is not, or within 90 days of such opinion, will
not be, deductible by the Company, in whole or in part, for United States
federal income tax purposes, or (iii) CFB Capital is, or will be within 90 days
of the date of the opinion, subject to more than a DE MINIMIS amount of other
taxes, duties or other

14
<PAGE>
governmental charges. See "-- Possible Tax Law Changes Affecting the Capital
Securities" below for a discussion of certain legislative proposals that, if
adopted, could give rise to a Tax Event, which may permit the Company to cause a
redemption of the Junior Subordinated Debentures (and therefore the Capital
Securities) prior to February 1, 2002.

An "Investment Company Event" means the receipt by the Company and CFB
Capital of an opinion of counsel experienced in such matters to the effect that,
as a result of any change in law or regulation or a change in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, CFB Capital is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act, which change becomes effective on or after the original issuance of
the Capital Securities.

A "Capital Treatment Event" means the reasonable determination by the
Company that, as a result of any amendment to, or change (including any proposed
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision thereof or therein, or as a result of any official or
administrative pronouncement or action or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such proposed change, pronouncement or decision is announced on or after the
date of issuance of the Capital Securities under the Trust Agreement, there is
more than an insubstantial risk of impairment of the Company's ability to treat
the Capital Securities (or any substantial portion thereof) 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 the Company.

POSSIBLE TAX LAW CHANGES AFFECTING THE CAPITAL SECURITIES
On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill") was
released which would, among other things, generally deny interest deductions for
interest on an instrument, issued by a corporation, that has a maximum term of
more than 20 years and that is not shown as indebtedness on the separate balance
sheet of the issuer or, where the instrument is issued to a related party (other
than a corporation), where the holder or some other related party issues a
related instrument that is not shown as indebtedness on the issuer's
consolidated balance sheet. It is possible that this provision could be adopted
with retroactive effect, in which event the Company might be unable to deduct
interest on the Junior Subordinated Debentures. However, on March 29, 1996, the
Chairmen of the Senate Finance and House Ways and Means Committees issued a
joint statement to the effect that it was their intention that the effective
date of the President's legislative proposals, if adopted, will be no earlier
than the date of appropriate Congressional action. There can be no assurance,
however, that current or future legislative proposals or final legislation will
not affect the ability of the Company to deduct interest on the Junior
Subordinated Debentures. Such a change could give rise to a Tax Event, which may
permit the Company, upon approval of the Federal Reserve if then required under
applicable capital guidelines or policies of the Federal Reserve, to cause a
redemption of the Capital Securities. See "Description of the Capital Securities
- -- Redemption -- Tax Event Redemption" and "Description of the Junior
Subordinated Debentures -- Redemption." See also "Certain Federal Income Tax
Consequences -- Possible Tax Law Changes."

POSSIBLE DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES TO HOLDERS OF CAPITAL
SECURITIES
The Company will have the right at any time to terminate CFB Capital and
cause the Junior Subordinated Debentures to be distributed to the holders of the
Capital Securities in liquidation of CFB Capital, subject to the receipt of any
required prior approval of the Federal Reserve. Because holders of the Capital
Securities may receive Junior Subordinated Debentures in liquidation of CFB
Capital and because Distributions are otherwise limited to payments on the
Junior Subordinated Debentures, prospective purchasers of the Capital Securities
are also making an investment decision with regard to the Junior Subordinated
Debentures and should carefully review all the information regarding the Junior
Subordinated Debentures contained herein. See "Description of the Capital
Securities -- Liquidation Distribution Upon Termination" and "Description of the
Junior Subordinated Debentures."

LIMITATIONS ON DIRECT ACTIONS AGAINST THE COMPANY AND ON RIGHTS UNDER THE
GUARANTEE
Under the Guarantee, the Company guarantees the payment of Distributions by
CFB Capital and payments on liquidation of or redemption of the Capital
Securities (subordinate to the right to payment of

15
<PAGE>
Senior and Subordinated Debt of the Company) to the extent of funds held by CFB
Capital. If CFB Capital has insufficient funds to pay Distributions on the
Capital Securities (i.e., if the Company has failed to make required payments
under the Junior Subordinated Debentures), a holder of the Capital Securities
would have the right to institute a legal proceeding directly against the
Company for enforcement of payment to such holder of the principal of or
interest on such Junior Subordinated Debentures having a principal amount equal
to the aggregate Liquidation Amount of the Capital Securities of such holder (a
"Direct Action"). Except as described herein, holders of the Capital Securities
will not be able to exercise directly any other remedy available to the holders
of the Junior Subordinated Debentures or assert directly any other rights in
respect of the Junior Subordinated Debentures.

Under the Guarantee, Wilmington Trust Company will act as indenture trustee
(the "Guarantee Trustee"). The holders of not less than a majority in aggregate
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 the Guarantee or to direct the exercise of any
trust power conferred upon the Guarantee Trustee under the Guarantee Agreement.
Any holder of the Capital Securities may institute a legal proceeding directly
against the Company to enforce its rights under the Guarantee without first
instituting a legal proceeding against CFB Capital, the Guarantee Trustee or any
other person or entity. The Trust Agreement provides that each holder of the
Capital Securities by acceptance thereof agrees to the provisions of the
Guarantee Agreement and the Indenture. See "Description of Junior Subordinated
Debentures -- Enforcement of Certain Rights of Holders of Capital Securities"
and "-- Debenture Events of Default" and "Description of Guarantee."

LIMITED COVENANTS

The covenants in the Indenture are limited, and there are no covenants
relating to the Company in the Trust Agreement. As a result, neither the
Indenture nor the Trust Agreement protects holders of Junior Subordinated
Debentures, or Capital Securities, respectively, in the event of a material
adverse change in the Company's financial condition or results of operations or
limits the ability of the Company or any subsidiary to incur additional
indebtedness. Therefore, the provisions of these governing instruments should
not be considered a significant factor in evaluating whether the Company will be
able to comply with its obligations under the Junior Subordinated Debentures or
the Guarantee.

LIMITED VOTING RIGHTS

Holders of the Capital Securities will generally have limited voting rights
relating only to the modification of the Capital Securities and certain other
matters described herein. In the event that (i) there is a Debenture Event of
Default (as defined herein) with respect to the Junior Subordinated Debentures
(see "Description of the Junior Subordinated Debentures -- Events of Default"),
(ii) the Property Trustee fails to pay any distribution on the Capital
Securities for 30 days (subject to deferral of distributions as provided under
"Description of the Capital Securities -- Extension Periods"), (iii) the
Property Trustee fails to pay the redemption price on the Capital Securities
when due upon redemption, (iv) the Property Trustee fails to observe a covenant
in the Trust Agreement for the Capital Securities for 60 days after receiving a
Notice of Default, or (v) the Property Trustee is declared bankrupt or insolvent
and not replaced by the Company within 60 days, the holders of a majority of the
outstanding Capital Securities will be able to remove the Property Trustee and
the Indenture Trustee (but not the Administrative Trustees who may only be
removed by the Company as holder of the Common Securities). See "Description of
the Capital Securities -- Voting Rights; Amendment of the Trust Agreement" and
"-- Removal of Trustees."

ABSENCE OF EXISTING PUBLIC MARKET; MARKET PRICES

There is no existing market for the Capital Securities. The Capital
Securities have been approved for listing on the Nasdaq National Market. There
can be no assurance that an active and liquid trading market for the Capital
Securities will develop or that a continued listing of the Capital Securities
will be available on Nasdaq. Although the Underwriters have informed CFB Capital
and the Company that the Underwriters intend to make a market in the Capital
Securities offered hereby, the Underwriters are not obligated to do so

16
<PAGE>
and any such market making activity may be terminated at any time without notice
to the holders of the Capital Securities. Future trading prices of the Capital
Securities will depend on many factors including, among other things, prevailing
interest rates, the operating results and financial condition of the Company,
and the market for similar securities. There can be no assurance as to the
market prices for the Capital Securities or the Junior Subordinated Debentures
that may be distributed in exchange for the Capital Securities if the Company
exercises its right to terminate CFB Capital. Accordingly, the Capital
Securities that an investor may purchase, or the Junior Subordinated Debentures
that a holder of the Capital Securities may receive in liquidation of CFB
Capital, may trade at a discount from the price that the investor paid to
purchase the Capital Securities offered hereby.

RISKS INVOLVED IN ACQUISITION STRATEGY

The Company has grown and intends to continue to grow primarily through
acquisitions of banks and other financial institutions. Such acquisitions
involve risks of adversely changing results of operations, changes in the
Company's capital structure, including possible increased reliance on debt,
unforeseen liabilities or asset quality problems of acquired entities and other
conditions beyond the control of the Company, such as adverse personnel
relations, loss of customers because of change of identity, and deterioration in
local economic conditions. In connection with the recent acquisition of Mountain
Parks, such risks are heightened by the fact that Mountain Parks is the largest
institution acquired by the Company. See "Recent Developments."

Management believes future growth in the assets and earnings of the Company
will depend in significant part on consummation of acquisitions. The ability of
the Company to pursue this strategy depends in part on its capital position and,
in the case of cash acquisitions, on its cash assets or ability to acquire cash.
Further, acquisition candidates may not be available in the future on terms
favorable to the Company. The Company must compete with a variety of individuals
and institutions, including major regional bank holding companies, for suitable
acquisition candidates. Although the Company has focused its attention on
smaller markets, in which the Company believed there was less competition from
the money center banks and major regional bank holding companies, the Company
recently acquired operations in metropolitan areas. The Company may make further
acquisitions of companies with operations in metropolitan areas, in which case
it will face more competition for such acquisitions from larger institutions.
Further, certain regional holding companies have focused on the smaller markets
traditionally targeted by the Company, and there can be no assurance that the
acquisition activities of competitors in these markets will not increase. Such
competition is likely to affect the Company's ability to make acquisitions,
increase the price that the Company pays for certain acquisitions and increase
the Company's costs in analyzing possible acquisitions.

LOANS AND INVESTMENTS

In allocating assets among locally generated loans, investment assets and
other earning assets, the Company attempts to maximize its return while managing
risk at an acceptable level. Although the Company has a diversified loan
portfolio, the economic health of the Company's primary trade area, and the
ability of many of the Company Banks' borrowers to repay their loans (including
real estate, commercial and agricultural loans) is dependent to a large extent
on the health of the agricultural sector of the economy. The Company's asset
allocation strategies include an emphasis on quality local loan growth and the
diversification and performance of its earning asset portfolios. The Company has
purchased loan assets, including secured discounted lease payments and loan
participations, to enhance the performance of, and to diversify, its asset
portfolios. Many of such loan assets have been originated by regional banks in
the Midwest and national leasing and finance companies with whom the Company has
ongoing business relationships. Such assets are subject to the Company's
standard credit guidelines and bear the credit risks attendant to commercial and
industrial loans.

COMPETITION

Banking is a highly competitive industry. The Company Banks compete directly
with other banks and lending and financial institutions in their local
communities. The Company Banks also compete indirectly

17
<PAGE>
with regional and national financial institutions, especially in larger
metropolitan market areas in which the Company has increased its operations as a
result of recent acquisitions. Further, changes in government regulation of
banking, particularly recent legislation which removes restrictions on
interstate banking and permits interstate branching, are likely to increase
competition by out-of-state banking organizations or by other financial
institutions in the Company's smaller markets as well as its metropolitan market
areas.

INTEREST RATES

Banking companies' earnings depend largely on the relationship between the
cost of funds, primarily deposits, and the yield on earning assets. This
relationship, known as the interest rate spread, is subject to fluctuation and
is affected by economic and competitive factors which influence interest rates,
the volume and mix of interest-earning assets and interest-bearing liabilities,
and the level of non-performing assets. The Company is subject to interest rate
risk to the degree that its interest-bearing liabilities reprice or mature more
slowly or more rapidly or on a different basis than its interest earning assets.
Given the Company's current volume and mix of interest-bearing liabilities and
interest earning assets, the Company's interest rate spread could be expected to
increase during times of rising interest rates and, conversely, to decline
during times of falling interest rates. Although the Company believes its
current level of interest rate sensitivity is reasonable, declines in interest
rates may have an adverse effect on the Company's results of operations.

REGULATION

As a bank holding company, the Company is subject to extensive regulation by
the Federal Reserve. This regulation limits the manner in which the Company and
the Company Banks conduct their businesses, undertake new investments and
activities and obtain financing. This regulation is designed primarily for the
protection of the deposit insurance funds and national monetary policies, and
not to benefit holders of securities of financial institutions. In addition, the
Company Banks are each subject to extensive regulation under federal and state
laws, rules and policies, which are subject to change. In September 1996, the
Economic Growth and Regulatory Paperwork Reduction Act of 1996 (the "1996 Act")
was enacted. The 1996 Act included extensive revisions to real estate and
consumer lending laws, as well as changes to bank application and examination
requirements and a financial restructuring of the deposit insurance funds which
will remove the competitive advantage over savings institutions enjoyed by
commercial banks, such as the Company Banks. In September 1994, the Interstate
Banking and Branching Efficiency Act of 1994 (the "1994 Act") was enacted,
generally eliminating all remaining legal restrictions on interstate banking.
The 1994 Act will permit interstate branching beginning June 1, 1997, subject to
states' rights to "opt-in" early, or "opt-out", and to impose certain limited
requirements on out-of-state entrants. To date, over 40 states have adopted
special legislation relating to interstate branching, most of which have
provided interstate branching opportunities in response to the federal law. The
1994 Act is anticipated to continue the trend of increasing consolidation within
the banking industry. The 1994 Act addressed the authority of banking
organizations to combine banking locations under interstate charters, but did
not override the authority of individual states to limit or restrict branching
by local and foreign banks alike. However, recent legislation in several states
has mirrored the trend in federal law to remove legal restrictions on expansion.
For example, effective January 1, 1997, Colorado and North Dakota will permit
unrestricted statewide intrastate branching, which may increase competition in
previously-protected local markets served by the Company. There can be no
assurance that implementation of and changes in federal and state laws and
regulations affecting banking will not adversely affect the Company.

KEY PERSONNEL

Continued profitability of the Company Banks and the Company are dependent
on a limited number of key persons, including Donald R. Mengedoth, the President
and Chief Executive Officer, Mark A. Anderson, the Executive Vice President and
Chief Financial Officer, Ronald K. Strand, the Executive Vice President, Banking
Group, and David E. Groshong, the Executive Vice President, Financial Services,
of the Company. There would likely be a difficult transition period in case the
services of any of these individuals were lost to the Company because of death
or other reasons. There is no assurance that the Company will be able to retain
its current key personnel or attract additional qualified key persons as needed.

18
<PAGE>
RECENT DEVELOPMENTS

RECENT ACQUISITIONS

In 1996, the Company completed the acquisitions described below, each of
which was accounted for as a pooling of interests.

MOUNTAIN PARKS FINANCIAL CORP. On December 18, 1996, the Company acquired
Mountain Parks Financial Corp. ("Mountain Parks"), a bank holding company that
operated a state chartered bank with full service commercial banking facilities
in 17 Colorado communities. At September 30, 1996, Mountain Parks had total
assets of approximately $581.8 million and total stockholders' equity of
approximately $57.1 million. Upon completion of the merger, the Company issued
approximately 5.2 million shares of common stock to the former holders of
Mountain Parks common stock. The market value of the Company's common stock
issued in the merger was approximately $142.2 million, based on the closing
price of Company common stock on the Nasdaq National Market on December 18,
1996.

The Mountain Parks Banks offer a full range of commercial and consumer
banking services and emphasize serving the needs and catering to the economic
strengths of the communities in which they are located. The Mountain Parks
Banks' primary lending focus is on commercial loans, real estate mortgage loans,
residential real estate construction loans and, to a lesser extent, consumer
loans. The operating strategy of the Mountain Parks Banks is to provide a high
level of personal and professional service and to promote employee participation
in community affairs in order to build long-term relationships with established
businesses and individual customers in its market areas.

The Mountain Parks Banks are located in winter ski and summer recreational
areas in the Colorado mountains (Breckenridge, Fairplay, Frisco, Kremmling,
Granby, Grand Lake and Silverthorne) and in the greater Denver/Boulder
metropolitan area (Aurora, Boulder, Conifer, Denver, Elizabeth, Englewood,
Evergreen, Kiowa, Louisville and Parker). Pursuant to an arrangement entered
into with the Federal Reserve to satisfy its concerns about market
concentrations in certain Colorado banking markets, the Company has pending
agreements to sell the Mountain Parks banking offices in Granby and Grand Lake.

As part of the acquisition of Mountain Parks, the Company also acquired (i)
an 85% interest in Equity Lending, Inc., a specialty consumer mortgage company
involved in originating, owning and servicing non-conforming residential
mortgages in Arizona, Colorado, Minnesota and Wisconsin, and (ii) Mountain Parks
Financial Services, Inc., a consumer finance company located in Denver, Colorado
that focuses on the purchase, origination and servicing of consumer installment
contracts, primarily sub-prime auto contracts. On January 3, 1997, the Company
acquired the remaining 15% interest in Equity Lending, Inc.

FINANCIAL BANCORP, INC. On October 1, 1996, the Company acquired Financial
Bancorp, Inc., Trinidad, Colorado ("Financial Bancorp"), the holding company of
Trinidad National Bank (the "Trinidad Bank"). At September 30, 1996, Financial
Bancorp had total assets of approximately $69.5 million and total stockholders'
equity of approximately $9.6 million. Upon completion of the merger, the Company
issued 538,803 shares of common stock to the former holders of Financial Bancorp
common stock. The market value of the Company's common stock issued in the
merger was approximately $12.7 million, based on the closing price of the
Company's common stock on the Nasdaq National Market on September 30, 1996. The
Trinidad Bank is a community bank located in southeastern Colorado which serves
a wide range of commercial, agricultural and consumer banking needs within its
market. The Trinidad Bank is primarily engaged in attracting deposits and
investing those funds in loans and investment securities.

RECENT FINANCIAL RESULTS

The Company has announced its preliminary year end unaudited financial
information, as restated to account for the acquisition of Mountain Parks on
December 18, 1996, which was accounted for as a pooling-of-interests
transaction. For the year ended December 31, 1996, net income was $32,510,000,
equal to $1.79 per common share on a fully diluted basis, compared to net income
of $22,488,000, or $1.74 fully diluted, in 1995. The 1996 results include a
variety of one-time charges associated with the Mountain Parks acquisition,
including after-tax costs of $2.6 million recognized in the fourth quarter of
1996. These costs included a $560,000 write-down, net of tax effect, of the
Company's investment in a bank in Vail, Colorado, which is being divested to
comply with a requirement imposed by the Federal Reserve Board to satisfy
concerns about anti-

19
<PAGE>

competitive issues. The costs also included a total of $1.1 million of expenses
and charges, net of tax effect, to (i) integrate and conform the loan portfolio
of Mountain Parks' non-prime mortgage subsidiary to CFB's credit policy, and
(ii) otherwise facilitate the integration of operating activities of Mountain
Parks into the Company, including additional employee expenses and other
expenses associated with the modification of the operating units of the acquired
entity. The remainder of the acquisition-related costs consisted of professional
services fees, severance payments and other employee benefits adjustments, fees
paid to terminate duplicate service contracts and write-offs of assets not
expected to be retained by the Company. Excluding the impact of the Mountain
Parks acquisition and the related charges recognized during the year, net income
was $2.18 per common share on a fully diluted basis.

The Company's assets increased to $3.1 billion at December 31, 1996, from a
restated level of $2.8 billion at the end of 1995. Assets originally reported at
December 31, 1995, prior to the restatement, were $2.3 billion, increasing 39%
in 1996. Deposits increased to $2.5 billion, up from a restated level of $2.4
billion a year earlier.

Certain restated summary financial information as of December 31, 1996 and
1995 and for the years then ended is set forth below:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1996 1995
----------- -----------
(DOLLARS IN THOUSANDS,
EXCEPT PER SHARE DATA)
<S> <C> <C>
OPERATING DATA:
Net interest income........................................... $ 134,192 $ 109,977
Non interest income........................................... 27,370 22,488
Provision for loan losses..................................... 6,757 2,711
Net income.................................................... 32,510 29,953
Dividends on preferred stock.................................. 1,610 1,610
Net income applicable to common equity........................ 30,900 28,343

OPERATING RATIOS AND OTHER DATA:
Return on average assets...................................... 1.13% 1.24%
Return on average common shareholders' equity................. 15.69% 18.19%
Net interest margin........................................... 5.32% 5.06%
Net charge-offs to average loans.............................. 0.22% 0.17%

FINANCIAL CONDITION DATA:
Assets........................................................ $ 3,116,398 $ 2,769,976
Loans......................................................... 2,064,108 1,767,193
Investment securities (1)..................................... 729,236 717,342
Deposits...................................................... 2,537,440 2,359,716
Long-term debt................................................ 46,287 81,288
Preferred shareholders' equity................................ 22,988 23,000
Common shareholders' equity................................... 221,583 181,004
Book value per common share................................... 12.92 11.25
Tangible book value per common share.......................... 10.63 9.08

FINANCIAL CONDITION RATIOS:
Nonperforming assets to total loans and OREO.................. 0.70% 0.31%
Allowance for loan losses to total loans...................... 1.27% 1.29%
Allowance for loan losses to nonperforming loans.............. 201% 608%

REGULATORY CAPITAL RATIOS:
Tier 1 capital................................................ 8.88% 8.51%
Total capital................................................. 11.10% 11.18%
Leverage ratio................................................ 6.61% 6.10%
</TABLE>

- --------------------------
(1) Includes available-for-sale securities and held-to-maturity
securities.

20
<PAGE>
USE OF PROCEEDS

All of the proceeds from the sale of Capital Securities will be invested by
CFB Capital in the Junior Subordinated Debentures. The net proceeds to the
Company from the sale of the Junior Subordinated Debentures of the Company are
estimated to be $ (net of estimated underwriting commission and other
estimated offering expenses). The Company intends to use the net proceeds for
general corporate purposes, which may include without limitation possible future
acquisitions, funding investments in, or extension of credit to, the Company's
subsidiaries, repayment of maturing obligations and redemption of securities.
Although the Company does not have any signed contracts, letters of intent or
agreements in principle and is not currently engaged in any significant
negotiations, the Company routinely solicits and reviews acquisition
opportunities and, at any given time, may have bids outstanding or may be
involved in discussions with the owners of financial institutions or other
parties relative to a particular financial institution. Pending their
application, the net proceeds may be invested in short-term investment grade
financial instruments.

The Company is required by the Federal Reserve to maintain certain levels of
capital for bank regulatory purposes. On October 21, 1996, the Federal Reserve
announced that certain qualifying amounts of cumulative preferred securities
having the characteristics of the Capital Securities could be included as Tier 1
capital for bank holding companies. Such Tier 1 capital treatment, together with
the Company's ability to deduct, for federal income tax purposes, interest
payable on the Junior Subordinated Debentures, will provide the Company with a
cost-effective means of obtaining capital for bank regulatory purposes.

ACCOUNTING TREATMENT

For financial reporting purposes, CFB Capital will be treated as a
subsidiary of the Company and, accordingly, the accounts of CFB Capital will be
included in the consolidated financial statements of the Company. The Capital
Securities will be presented as a separate line item in the consolidated balance
sheet of the Company under the caption "Company Obligated Mandatorily Redeemable
Preferred Securities of Subsidiary Trust Holding Solely Junior Subordinated
Debentures," and appropriate disclosures about the Capital Securities, the
Guarantee and the Junior Subordinated Debentures will be included in the notes
to consolidated financial statements. For financial reporting purposes, the
Company will record Distributions payable on the Capital Securities as an
expense in the consolidated statements of operations.

Future reports of the Company filed under the Exchange Act will include a
footnote to the financial statements stating that (i) CFB Capital is
wholly-owned, (ii) the sole assets of CFB Capital are the Junior Subordinated
Debentures (specifying the principal amount, interest rate and maturity date of
such Junior Subordinated Debentures), and (iii) the back-up obligations, in the
aggregate, constitute a full and unconditional guarantee by the Company of the
obligations of CFB Capital under the Capital Securities. CFB Capital will not
provide separate reports under the Exchange Act.

21
<PAGE>
CAPITALIZATION

The following table sets forth the capitalization of the Company at
September 30, 1996 and as adjusted to give effect to the issuance of the Capital
Securities by CFB Capital in this offering.

<TABLE>
<CAPTION>
SEPTEMBER 30, 1996
-----------------------
ACTUAL (1) AS ADJUSTED
---------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Long-term debt:
Capital leases......................................................................... $ 3,093 $ 3,093
Long-term bank debt.................................................................... 4,398 4,398
7.75% Subordinated Notes due 2000...................................................... 23,000 23,000
9.00% Exchangeable Subordinated Notes due 2005......................................... 11,500 11,500
---------- -----------
Total long-term debt................................................................. 41,991 41,991
Company obligated mandatorily redeemable preferred securities of subsidiary trust holding
solely junior subordinated debentures (2)............................................... -- 60,000
Shareholders' equity:
Preferred stock, $.01 par value, 1,770,000 shares authorized; no shares issued......... -- --
7% Cumulative Convertible Preferred Stock, $100 stated value; 230,000 shares
authorized; 229,975 shares issued and outstanding..................................... 22,997 22,997
Common stock, $.01 par value, 30,000,000 shares authorized; 16,532,714 shares issued
and outstanding (3)................................................................... 165 165
Capital surplus........................................................................ 70,114 70,114
Retained earnings...................................................................... 134,199 134,199
Treasury stock, 30,511 shares.......................................................... (696) (696)
---------- -----------
Total shareholders' equity........................................................... 226,779 226,779
---------- -----------
Total capitalization............................................................... $ 268,770 $ 328,770
---------- -----------
---------- -----------
</TABLE>

- ------------------------
(1) Actual capitalization as of September 30, 1996 has been restated to reflect
the acquisition of Mountain Parks, which occurred on December 18, 1996, but
has not been restated to reflect the acquisition of Financial Bancorp on the
basis that the effect of that acquisition is not material to this
information.

(2) The subsidiary trust is CFB Capital I, a wholly-owned subsidiary of the
Company that will hold the Junior Subordinated Debentures as its sole asset.
The Capital Securities are issued by CFB Capital. The sole assets of CFB
Capital consist of approximately $61.8 million principal amount of Junior
Subordinated Debentures issued by the Company to CFB Capital. The Junior
Subordinated Debentures will bear interest at the rate of % per annum
and will mature on February 1, 2027, which date may be shortened to a date
not earlier than February 1, 2002 if certain conditions are met. The Junior
Subordinated Debentures are redeemable prior to maturity at the option of
the Company, subject to any required prior approval of the Federal Reserve,
(i) on or after February 1, 2002, in whole at any time or in part from time
to time, or (ii) at any time, in whole (but not in part), upon the
occurrence and continuation of a Tax Event, an Investment Company Event or a
Capital Treatment Event (each as defined herein). See "Description of Junior
Subordinated Debentures -- Redemption." The Company owns all of the Common
Securities of CFB Capital.

(3) Excludes (i) 1,443,323 shares of common stock issuable upon the conversion
of the 229,975 shares of outstanding 7% Cumulative Convertible Preferred
Stock, (ii) 535,381 shares of common stock issuable pursuant to outstanding
stock options and (iii) 2,022,105 shares of common stock issuable pursuant
to options which may be granted under the Company's stock option plans.

22
<PAGE>
MANAGEMENT

The executive officers and directors of the Company are as follows:

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---------------------------- --- --------------------------------------------------------------
<S> <C> <C>
Donald R. Mengedoth 52 President, Chief Executive Officer and Chairman of the Board
Mark A. Anderson, CFA 39 Executive Vice President, Chief Financial Officer, Secretary
and Treasurer
Ronald K. Strand 50 Executive Vice President Banking Group
David E. Groshong 48 Executive Vice President Financial Services
Thomas E. Hansen 44 Senior Vice President and Central Region Manager
Bruce A. Heysse 45 Senior Vice President Acquisitions
Thomas A. Hilt 54 Senior Vice President Operations and Administration
Gary A. Knutson 49 Senior Vice President and Western Region Manager
David A. Lee 53 Senior Vice President and Eastern Region Manager
Patricia J. Staples 41 Senior Vice President Marketing
Patricia A. Adam 60 Director
James T. Anderson 57 Director
Patrick E. Benedict 63 Director
Patrick Delaney 54 Director
John H. Flittie 60 Director
Cargill MacMillan, Jr. 69 Director
Dennis M. Mathisen 57 Director
Dean E. Smith 65 Director
Thomas C. Wold 59 Director
Harvey L. Wollman 61 Director
</TABLE>

Donald R. Mengedoth has been President, Chief Executive Officer, Chairman of
the Board and a director of the Company since its organization in 1986. He was
Senior Vice President of First Bank System, Inc. ("FBS") from 1982 to 1987 and
has worked in the banking business since 1966, including management positions in
retail banking operations, human resources and commercial lending. From 1984 to
1987, Mr. Mengedoth was Regional Managing Director of FBS. From 1979 to 1982,
Mr. Mengedoth was Vice President -- Operations for FBS. Prior to that time, he
was Senior Vice President of First Bank Milwaukee.

Mark A. Anderson has been Executive Vice President, Chief Financial Officer,
Secretary and Treasurer of the Company since its organization in 1986. He was
Vice President and Regional Controller for FBS from 1984 to 1987. From 1979 to
1984, he held various positions with FBS-affiliated banks in the finance and
credit analysis areas. Mr. Anderson is a Chartered Financial Analyst and a
Certified Management Accountant.

Ronald K. Strand has been Executive Vice President Banking Group since
February 1993. He was previously Senior Vice President and Regional Manager for
South Dakota and North Dakota for the Company from January 1991 to February
1993. Previously, Mr. Strand had been Vice President and

23
<PAGE>
Regional Manager for the Company and President, Chief Executive Officer and a
director of the Company's affiliate bank in Wahpeton, North Dakota since 1988.
Prior to his affiliation with the Company, he served as President and Chief
Executive Officer of Norwest Bank of North Dakota, N.A., Wahpeton, from 1985
until 1988. He was employed by Norwest for a total of 15 years, having
previously worked in Norwest banks in Jamestown, North Dakota and Moorhead,
Minnesota.

David E. Groshong has been Executive Vice President Financial Services since
May 1996. He was previously Chairman and Chief Executive Officer of the
Company's affiliate bank in Alliance, Nebraska from May 1995 to May 1996.
Previously, Mr. Groshong had been President and Chief Executive of the Company's
affiliate bank in Fergus Falls, Minnesota since 1992 and as Senior Vice
President and Senior Loan Officer of the Fargo Bank since 1985. He was employed
by Norwest Bank of Minnesota, N.A. for a total of eight years and prior to that
worked in the consumer finance industry.

Thomas E. Hansen has been Senior Vice President and Central Region Manager
since April 1993. He also served as President, Chief Executive Officer and
director of the Company's affiliate bank in Fargo, North Dakota from April 1993
to December 1996. Previously, he was employed by Norwest Bank Fargo for 19
years, most recently as President.

Bruce A. Heysse has been Senior Vice President Acquisitions since July 1996.
He was Senior Vice President and Integration Manager of the Company from
November 1995 to June 1996. He was Vice President and Senior Credit Officer of
the Company from 1987 to November 1995. He began his banking career at the
Company's affiliate bank in Wahpeton, North Dakota, and had a total of 11 years
of banking experience prior to joining the Company.

Thomas A. Hilt has been Senior Vice President Operations and Administration
of the Company since 1987 and President of Community First Service Corporation,
the Company's data processing subsidiary, since 1988. He was Vice President and
Manager Operations Support for the Regional Division of FBS from 1984 to 1987.
Prior to 1984, he held various positions with FBS since 1967, including
responsibility for systems development, programming, audit and examination
functions.

Gary A. Knutson has been Senior Vice President and Western Region Manager of
the Company since September 1993. He was President, Chief Executive Officer and
director of the Company's affiliate bank in Wahpeton, North Dakota from January
1991 to September 1993. He began his banking career at the Company's affiliate
bank in Lidgerwood, North Dakota, and had a total of 14 years of banking
experience prior to joining the Company.

David A. Lee has been Senior Vice President and Eastern Region Manager of
the Company since January 1991. He had been a Region Manager of the Company
since 1987. He was President and Chief Executive Officer and a director of the
Company's affiliate bank in Little Falls from 1988 to January 1993. Mr. Lee held
various positions with FBS from 1966 to 1982.

Patricia J. Staples has been Senior Vice President Marketing since July
1994. Previously, Ms. Staples was employed as the public relations manager with
MeritCare Health System for 10 years.

Patricia A. Adam is Secretary to the South Dakota Senate and is active in
various service, civic and community organizations in Pierre, South Dakota. Ms.
Adam is or has been a member of the Boards of Directors of the South Dakota
Historical Society, where she serves as President, of the South Dakota Discovery
Center and Aquarium, where she served as President, of the Children's Care
Hospital and School in Sioux Falls, South Dakota, the University of South Dakota
Foundation, the Associated School Board of South Dakota, where she served as
President for two years, and the Pierre, South Dakota Independent School Board
where she served as President for five years. Ms. Adam previously served as a
member of the Board of Directors of First National Bank, Selby, South Dakota.
She has been a director of the Company since 1987.

James T. Anderson has been the Vice President and Treasurer of U S WEST,
Inc., a telecommunications service provider located in Englewood, Colorado,
since 1984. Mr. Anderson held various positions in the Bell System from 1963 to
1984. Mr. Anderson has been a director of the Company since August 1993.

24
<PAGE>
Patrick E. Benedict is the owner of Benedict Farms, Inc., a 6,000-acre
farming operation in Sabin, Minnesota. Mr. Benedict has been an advisory
director to the Board of Directors of the Company's affiliate bank in Fargo,
North Dakota since 1995 and was a director of the Company's affiliate bank in
Fargo, North Dakota from 1984 to 1995. Mr. Benedict is chairman of Golden
Growers Coop and of Pro Gold LLC, a North Dakota corn processing company that is
49% owned by Golden Growers. He also serves on the executive committee and Board
of Directors of the Neuropsychiatric Research Institute, the Board of Directors
of MeritCare Health System, and is chairman of Northern Grain Company, all in
Fargo, North Dakota. Mr. Benedict is chairman emeritus of American Crystal Sugar
Company and past chairman of the Moorhead State University Foundation, both in
Moorhead, Minnesota. He has been a director of the Company since 1992.

Patrick Delaney is a partner in the Minneapolis, Minnesota law firm of
Lindquist & Vennum P.L.L.P., counsel to the Company. He has been a lawyer since
1967. Mr. Delaney is the secretary of MTS Systems Corporation, a
Minneapolis-based manufacturer of systems for materials testing, measurement and
simulation. He is also a director and the Secretary of CNS, Inc. and a director
and Secretary of Applied Biometrics, Inc., both of which companies are medical
device manufacturers based in Minneapolis. He has been a director of the Company
since 1987.

John H. Flittie has been the President and Chief Operating Officer of
ReliaStar Financial Corp., formerly The NWNL Companies, Inc., a
Minneapolis-based insurance and financial services company, since July 1993. Mr.
Flittie held various positions with NWNL and Northwestern National from 1985 to
July 1993. From 1976 to 1985, Mr. Flittie was a partner at Touche Ross & Co., an
audit and consulting firm. Mr. Flittie is a member of the Board of Directors of
ReliaStar Financial Corp. and various subsidiaries of ReliaStar. He has been a
director of the Company since 1993.

Cargill MacMillan, Jr. is a director of Cargill Incorporated of Minnetonka,
Minnesota. Mr. MacMillan has spent his entire career with Cargill and until 1987
served as Chairman of the Finance Committee and until 1989 served as Senior Vice
President. He has served previously as a bank director and is currently a member
of the board of directors of several civic and charitable organizations. He has
been a director of the Company since 1987.

Dennis M. Mathisen served as Chairman of the Board, President and Chief
Executive Officer of Mountain Parks from its formation in 1981 until the
acquisition of Mountain Parks by the Company in December 1996. Since 1974, he
served as a director and principal officer of rural and suburban commercial
banks located in Colorado and Minnesota. He has also served as the President of
Marshall Financial Group (a provider of management, financing and merger and
acquisition services) since 1989. Mr. Mathisen is a member of the Board of
Directors of Transportation Corporation of America, a midwestern trucking
company; the Harlem Globetrotters, International, an international sports
entertainment company; and Horizon Asset Management, LLP, a registered asset
management company. Mr. Mathisen has been a director of the Company since
December 1996.

Dean E. Smith, a private investor, was the Managing General Partner of The
Robins Group, a private investment partnership, from 1983 to 1996. Mr. Smith
held various positions with First National Bank of Minneapolis from 1955 to
1967. Mr. Smith has served previously as a director of Citizens State Bank of
Green Isle, Green Isle, Minnesota, and Resource Bank and Trust Company,
Minneapolis, Minnesota. Mr. Smith has been a director of the Company since 1993.

Thomas C. Wold has been a practicing attorney in Fargo, North Dakota since
1962 and is President and a shareholder of the law firm of Wold Johnson, P.C. He
is active in the development of motels, apartments and other real estate
projects. He has been actively involved in a number of civic and charitable
organizations. He has been a director of the Company since 1987.

Harvey L. Wollman is a farmer in Frankfurt, South Dakota. Mr. Wollman served
in the South Dakota State Senate from 1968 to 1974, was Lieutenant Governor from
1974 to 1977, and served as Governor of South Dakota in 1978. Mr. Wollman has
served on various State government committees and is active in various service,
civic and community organizations. He has been a director of the Company since
1987.

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DESCRIPTION OF THE CAPITAL SECURITIES

The Capital Securities and the Common Securities will be issued pursuant to
the terms of the Trust Agreement. The Trust Agreement will be qualified as an
indenture under the Trust Indenture Act. Initially, Wilmington Trust Company
will be the Delaware Trustee and the Property Trustee and will act as trustee
for the purpose of complying with the Trust Indenture Act. The terms of the
Capital Securities will include those stated in the Trust Agreement and those
made part of the Trust Agreement by the Trust Indenture Act. This summary of
certain terms and provisions of the Capital Securities and the Trust Agreement
does not purport to be complete and is subject to, and is qualified in its
entirety by reference to, all the provisions of the Trust Agreement, including
the definitions therein of certain terms, and the Trust Indenture Act. Wherever
particular defined terms of the Trust Agreement (as amended or supplemented from
time to time) are referred to herein, such defined terms are incorporated
herein. The form of the Trust Agreement has been filed as an exhibit to the
Registration Statement of which this Prospectus forms a part.

GENERAL

Pursuant to the terms of the Trust Agreement, the Administrative Trustees on
behalf of CFB Capital will issue the Capital Securities and the Common
Securities (collectively, the "Trust Securities"). The Capital Securities will
represent preferred undivided beneficial interests in the assets of CFB Capital
and the holders thereof will be entitled to a preference in certain
circumstances with respect to Distributions and amounts payable on redemption or
liquidation over the Common Securities of CFB Capital (which will be held by the
Company), as well as other benefits as described in the Trust Agreement.

The Capital Securities will rank PARI PASSU, and payments will be made
thereon pro rata, with the Common Securities of CFB Capital except as described
under "Subordination of Common Securities of CFB Capital Held by the Company"
below.

Legal title to the Junior Subordinated Debentures will be held by the
Property Trustee in trust for the benefit of the holders of the Trust
Securities. The Guarantee executed by the Company for the benefit of the holders
of the Capital Securities (the "Guarantee") will be a guarantee on a
subordinated basis and will not guarantee payment of Distributions or amounts
payable on redemption of the Capital Securities or on liquidation of the Capital
Securities if CFB Capital does not have funds on hand available to make such
payments. See "Description of Guarantee."

DISTRIBUTIONS

PAYMENT OF DISTRIBUTIONS. Distributions on the Capital Securities will be
payable at the annual rate of % of the stated Liquidation Amount of $25,
payable quarterly in arrears on the 15th day of April, July, October and January
in each year, commencing April 15, 1997 to the holders of the Capital Securities
on the relevant record dates (each date on which Distributions are payable in
accordance with the foregoing, a "Distribution Date"). The amount of each
distribution due with respect to the Capital Securities will include amounts
accrued through the date the distribution payment is due. Distributions on the
Capital Securities will be payable to the holders thereof as they appear on the
register of CFB Capital on the relevant record date which, for so long as the
Capital Securities remain in book-entry form, will be one Business Day (as
defined below) prior to the relevant Distribution Date and, in the event the
Capital Securities are not in book-entry form, will be the 1st day of the month
in which the relevant Distribution Date occurs. Distributions will accumulate
from the date of original issuance. The first Distribution Date for the Capital
Securities will be April 15, 1997.

The amount of Distributions payable for any period will be computed on the
basis of a 360-day year of twelve 30-day months. In the event that any date on
which Distributions are payable on the Capital Securities is not a Business Day,
payment of the Distribution payable on such date will be made on the next
Business Day (and without any interest or other payment in respect to any such
delay) except that, if such Business Day is in the next succeeding calendar
year, payment of such Distribution shall be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on the date
such payment was

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originally payable. As used in this Prospectus, a "Business Day" shall mean any
day other than a Saturday or a Sunday, or a day on which banking institutions in
the State of Minnesota are authorized or required by law or executive order to
remain closed or a day on which the corporate trust office of the Property
Trustee or the Indenture Trustee is closed for business.

The funds of CFB Capital available for distribution to holders of its
Capital Securities will be limited to payments by the Company under the Junior
Subordinated Debentures in which CFB Capital will invest the proceeds from the
issuance and sale of its Capital Securities. See "Description of Junior
Subordinated Debentures." If the Company does not make interest payments on the
Junior Subordinated Debentures, the Property Trustee will not have funds
available to pay Distributions on the Capital Securities. The payment of
Distributions (if and to the extent CFB Capital has funds legally available for
the payment of such Distributions and cash sufficient to make such payments) is
guaranteed by the Company. See "Description of Guarantee."

EXTENSION PERIOD. So long as no Debenture Event of Default has occurred and
is continuing, the Company has the right under the Indenture to defer the
payment of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 20 consecutive quarters with respect to
each such period (each, an "Extension Period"), provided that no Extension
Period may extend beyond the Stated Maturity of the Junior Subordinated
Debentures. As a consequence of any such election, quarterly Distributions on
the Capital Securities will be deferred by CFB Capital during any such Extension
Period. Distributions to which holders of Capital Securities are entitled will
accumulate additional amounts thereon at the rate per annum of % thereof,
compounded quarterly from the relevant Distribution Date, to the extent
permitted under applicable law. The term "Distributions" as used herein shall
include any such additional accumulated amounts. During any such Extension
Period, the Company may not (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital stock (which includes common and preferred stock)
or (ii) make any payment of principal, interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Company that rank PARI PASSU
with or junior in interest to the Junior Subordinated Debentures or make any
guarantee payments with respect to any guarantee by the Company of the debt
securities of any subsidiary of the Company if such guarantee ranks PARI PASSU
with or junior in interest to the Junior Subordinated Debentures (other than (a)
dividends or distributions in common stock of the Company, (b) any declaration
of a dividend in connection with the implementation of a stockholders' rights
plan, or the issuance of stock under any such plan in the future, or the
redemption or repurchase of any such rights pursuant thereto, (c) payments under
the Guarantee and (d) purchases of common stock for issuance under any of the
Company's benefit plans for its directors, officers or employees). Prior to the
termination of any such Extension Period, the Company may further extend such
Extension Period, provided that such extension does not cause such Extension
Period to exceed 20 consecutive quarters or extend beyond the Stated Maturity.
Upon the termination of any such Extension Period and the payment of all amounts
then due, and subject to the foregoing limitations, the Company may elect to
begin a new Extension Period. Subject to the foregoing, there is no limitation
on the number of times that the Company may elect to begin an Extension Period.

The Company has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures.

REDEMPTION

MANDATORY REDEMPTION. Upon the repayment or redemption at any time, in
whole or in part, of any Junior Subordinated Debentures, the proceeds from such
repayment or redemption shall be applied by the Property Trustee to redeem a
Like Amount (as defined below) of the Trust Securities, upon not less than 30
nor more than 60 days' notice of a date of redemption (the "Redemption Date"),
at the Redemption Price (as defined below). See "Description of Junior
Subordinated Debentures -- Redemption." If less than all of

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the Junior Subordinated Debentures are to be repaid or redeemed on a Redemption
Date, then the proceeds from such repayment or redemption shall be allocated to
the redemption of the Trust Securities pro rata.

OPTIONAL REDEMPTION. The Company will have the right to redeem the Junior
Subordinated Debentures (i) on or after February 1, 2002, in whole at any time
or in part from time to time at a redemption price equal to the accrued and
unpaid interest on the Junior Subordinated Debentures so redeemed to the date
fixed for redemption, plus 100% of the principal amount thereof, or (ii) at any
time, in whole (but not in part), upon the occurrence of a Tax Event, an
Investment Company Event or a Capital Treatment Event at a redemption price
equal to the accrued and unpaid interest on the Junior Subordinated Debentures
so redeemed to the date fixed for redemption, plus 100% of the principal amount
thereof, in each case subject to receipt of prior approval by the Federal
Reserve if then required under applicable capital guidelines or policies of the
Federal Reserve. See "Description of Junior Subordinated Debentures --
Redemption."

TAX EVENT REDEMPTION, INVESTMENT COMPANY EVENT REDEMPTION, CAPITAL TREATMENT
EVENT REDEMPTION OR DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES. If a Tax
Event, an Investment Company Event or a Capital Treatment Event shall occur and
be continuing, the Company has the right to redeem the Junior Subordinated
Debentures in whole (but not in part) and thereby cause a mandatory redemption
of the Trust Securities in whole (but not in part) at the Redemption Price (as
defined below) within 90 days following the occurrence of such Tax Event,
Investment Company Event or Capital Treatment Event, in each case subject to
receipt of prior approval by the Federal Reserve if then required under
applicable capital guidelines or policies of the Federal Reserve. In the event a
Tax Event, an Investment Company Event or Capital Treatment Event has occurred
and is continuing and the Company does not elect to redeem the Junior
Subordinated Debentures and thereby cause a mandatory redemption of the Trust
Securities or to liquidate CFB Capital and cause the Junior Subordinated
Debentures to be distributed to holders of the Trust Securities in liquidation
of CFB Capital as described below, such Trust Securities will remain outstanding
and Additional Sums (as defined below) may be payable on the Junior Subordinated
Debentures.

DEFINITIONS.

"Additional Sums" means the additional amounts as may be necessary to be
paid by the Company with respect to the Junior Subordinated Debentures in order
that the amount of Distributions then due and payable by CFB Capital on the
outstanding Trust Securities of CFB Capital shall not be reduced as a result of
any additional taxes, duties and other governmental charges to which CFB Capital
has become subject.

"Like Amount" means (i) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount (as defined below) equal to that
portion of the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Capital Securities based upon the relative
Liquidation Amounts of such classes and the proceeds of which will be used to
pay the Redemption Price of such Trust Securities, and (ii) with respect to a
distribution of Junior Subordinated Debentures to holders of Trust Securities in
connection with a dissolution or liquidation of CFB Capital, Junior Subordinated
Debentures having a principal amount equal to the Liquidation Amount of the
Trust Securities of the holder to whom such Junior Subordinated Debentures are
distributed.

"Liquidation Amount" means the stated amount of $25 per Trust Security.

"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, allocated on a pro rata basis (based on
Liquidation Amounts) among the Trust Securities.

DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES

Subject to the Company having received prior approval of the Federal Reserve
if so required under applicable capital guidelines or policies of the Federal
Reserve, the Company will have the right at any time to liquidate CFB Capital
and, after satisfaction of the liabilities of creditors of CFB Capital as
provided by

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<PAGE>
applicable law, cause the Junior Subordinated Debentures to be distributed to
the holders of Trust Securities in liquidation of CFB Capital. After the
liquidation date fixed for any distribution of Junior Subordinated Debentures
for Capital Securities (i) such Capital Securities will no longer be deemed to
be outstanding, (ii) the Depositary or its nominee, as the record holder of the
Capital Securities, will receive a registered global certificate or certificates
representing the Junior Subordinated Debentures to be delivered upon such
distribution and (iii) any certificates representing Capital Securities not held
by the Depositary or its nominee will be deemed to represent the Junior
Subordinated Debentures having a principal amount equal to the Liquidation
Amount of such Capital Securities, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid Distributions on the Capital Securities
until such certificates are presented to the Administrative Trustees or their
agent for transfer or reissuance.

There can be no assurance as to the market prices for the Capital Securities
or the Junior Subordinated Debentures that may be distributed in exchange for
the Capital Securities if a dissolution and liquidation of CFB Capital were to
occur. Accordingly, the Capital Securities that an investor may purchase, or the
Junior Subordinated Debentures that the investor may receive on dissolution and
liquidation of CFB Capital, may trade at a discount to the price that the
investor paid to purchase the Capital Securities offered hereby.

REDEMPTION PROCEDURES

Capital Securities redeemed on each Redemption Date shall be redeemed at the
Redemption Price with the applicable proceeds from the contemporaneous
redemption of the Junior Subordinated Debentures. Redemptions of the Capital
Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that CFB Capital has funds on hand available
for the payment of such Redemption Price. See "-- Subordination of Common
Securities of CFB Capital Held by the Company" and "-- Guarantee."

If CFB Capital gives a notice of redemption in respect of the Capital
Securities, then, by 12:00 noon, Minneapolis time, on the Redemption Date, to
the extent funds are available, the Property Trustee will deposit with the
Depositary funds sufficient to pay the aggregate Redemption Price and will give
the Depositary irrevocable instructions and authority to pay the Redemption
Price to the holders of such Capital Securities. See "Book-Entry Issuance." If
such Capital Securities are no longer in book-entry form, the Property Trustee,
to the extent funds are available, will deposit with the paying agent for such
Capital Securities funds sufficient to pay the aggregate 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 Capital Securities. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date shall be payable to the holders of
such Capital 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 the Capital Securities will cease, except the right of the holders of
the Capital Securities to receive the applicable Redemption Price, but without
interest on such Redemption Price, and such Capital Securities will cease to be
outstanding. In the event that any date fixed for redemption of such Capital
Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day. In the event that payment of the Redemption
Price in respect of Capital Securities called for redemption is improperly
withheld or refused and not paid either by CFB Capital or by the Company
pursuant to the Guarantee, Distributions on such Capital Securities will
continue to accrue at the then applicable rate, from the Redemption Date
originally established by CFB Capital for such Capital 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. See "Description of Guarantee."

Subject to applicable law (including, without limitation, United States
federal securities law), the Company may at any time and from time to time
purchase outstanding Capital Securities by tender, in the open market or by
private agreement.

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<PAGE>
Payment of the Redemption Price on the Capital Securities and any
distribution of Junior Subordinated Debentures to holders of Capital Securities
shall be made to the applicable recordholders thereof as they appear on the
register of such Capital Securities on the relevant record date, which date
shall be one Business Day prior to the relevant Redemption Date or Liquidation
Date, as applicable; provided, however, that in the event that any Capital
Securities are not in book-entry form, the relevant record date for such Capital
Securities shall be a date at least 15 days prior to the Redemption Date or
Liquidation Date, as applicable. In the case of a liquidation, the record date
shall be no more than 45 days before the Liquidation Date.

If less than all of the Trust Securities issued by CFB Capital are to be
redeemed on a Redemption Date, then the aggregate Redemption Price for such
Trust Securities to be redeemed shall be allocated pro rata to the Capital
Securities and Common Securities based upon the relative Liquidation Amounts of
such classes. The particular Capital Securities to be redeemed shall be selected
by the Property Trustee from the outstanding Capital Securities not previously
called for redemption, by such method as the Property Trustee shall deem fair
and appropriate and which may provide for the selection for redemption of
portions (equal to $25 or an integral multiple thereof) of the Liquidation
Amount of Capital Securities. The Property Trustee shall promptly notify the
Trust 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
the Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of Capital Securities shall relate to the portion of
the aggregate Liquidation Amount of Capital 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 each holder of Trust Securities at such
holder's registered address. Unless CFB Capital defaults in payment of the
applicable Redemption Price, on and after the Redemption Date, Distributions
will cease to accrue on such Capital Securities called for redemption.

SUBORDINATION OF COMMON SECURITIES OF CFB CAPITAL HELD BY THE COMPANY

Payment of Distributions on, and the Redemption Price of, the Capital
Securities and Common Securities, as applicable, shall be made pro rata based on
the Liquidation Amounts of the Capital Securities and Common Securities;
provided, however, that if on any Distribution Date or Redemption Date a
Debenture Event of Default shall have occurred and be continuing, no payment of
any Distribution on, or applicable Redemption Price of, any of the Common
Securities, and no other payment on account of the redemption, liquidation or
other acquisition of the Common Securities, shall be made unless payment in full
in cash of all accumulated and unpaid Distributions on all of the outstanding
Capital Securities for all Distribution periods terminating on or prior thereto,
or in the case of payment of the applicable Redemption Price the full amount of
such Redemption Price on all of the outstanding Capital Securities then called
for redemption, shall have been made or provided for, and all funds available to
the Property Trustee shall first be applied to the payment in full in cash of
all Distributions on, or Redemption Price of, the Capital Securities then due
and payable.

In the case of any Event of Default under the Trust Agreement resulting from
a Debenture Event of Default, the Company as holder of the Common Securities
will be deemed to have waived any right to act with respect to any such Event of
Default until the effect of all such Events of Default have been cured, waived
or otherwise eliminated. Until any such Events of Default 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 Company as
holder 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.

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<PAGE>
LIQUIDATION DISTRIBUTION UPON TERMINATION

The Company will have the right at any time to terminate CFB Capital and
cause the Junior Subordinated Debentures to be distributed to the holders of the
Capital Securities. Such right is subject to the Company having received prior
approval of the Federal Reserve if then required under applicable capital
guidelines or policies of the Federal Reserve. See "Distribution of Junior
Subordinated Debentures" above.

In addition, pursuant to the Trust Agreement, CFB Capital shall
automatically terminate upon expiration of its term and shall earlier terminate
on the first to occur of: (i) certain events of bankruptcy, dissolution or
liquidation of the Company; (ii) delivery by the Company of written direction to
the Property Trustee to terminate CFB Capital (which direction is optional and
wholly within the discretion of the Company); (iii) redemption of all of the
Capital Securities as described under "Description of the Capital Securities --
Redemption -- Mandatory Redemption;" and (iv) the entry of an order for the
dissolution of CFB Capital by a court of competent jurisdiction.

If an early termination occurs as described in clause (i), (ii) or (iv)
above, CFB Capital shall be liquidated by the Trustees as expeditiously as the
Trustees determine to be possible by distributing, after satisfaction of
liabilities to creditors of CFB Capital as provided by applicable law, to the
holders of such Trust Securities a Like Amount of the Junior Subordinated
Debentures, unless such distribution is determined by the Property Trustee not
to be practical, in which event such holders will be entitled to receive out of
the assets of CFB Capital available for distribution to holders, after
satisfaction of liabilities to creditors of CFB Capital as provided by
applicable law, an amount equal to, in the case of holders of Capital
Securities, the aggregate of the Liquidation Amount of $25 per Trust Security
plus accrued and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If such Liquidation Distribution
can be paid only in part because CFB Capital has insufficient assets available
to pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by CFB Capital on the Capital Securities shall be paid on a pro rata
basis. The holder(s) of the Common Securities will be entitled to receive
distributions upon any such liquidation pro rata with the holders of the Capital
Securities, except that if a Debenture Event of Default has occurred and is
continuing, the Capital Securities shall have a priority over the Common
Securities.

Under current United States federal income tax law and interpretations and
assuming, as expected, CFB Capital is treated as a grantor trust, a distribution
of the Junior Subordinated Debentures should not be a taxable event to holders
of the Capital Securities. Should there be a change in law, a change in legal
interpretation, a Tax Event or other circumstances, however, the distribution
could be a taxable event to holders of the Capital Securities. See "Certain
Federal Income Tax Consequences." If the Company elects neither to redeem the
Junior Subordinated Debentures prior to maturity nor to liquidate CFB Capital
and distribute the Junior Subordinated Debentures to holders of the Capital
Securities, the Capital Securities will remain outstanding until the repayment
of the Junior Subordinated Debentures.

If the Company elects to liquidate CFB Capital and thereby causes the Junior
Subordinated Debentures to be distributed to holders of the Capital Securities
in liquidation of CFB Capital, the Company shall continue to have the right to
shorten the maturity of such Junior Subordinated Debentures, subject to certain
conditions. See "Description of Junior Subordinated Debentures -- General."

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EVENTS OF DEFAULT; NOTICE

Any one of the following events that has occurred and is continuing
constitutes an "Event of Default" under the Trust Agreement (an "Event of
Default") with respect to the Capital Securities (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):

(i) the occurrence of a Debenture Event of Default under the Indenture
(see "Description of Junior Subordinated Debentures -- Debenture Events of
Default"); or

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

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

(iv) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Trustees in the Trust Agreement (other than
a default or breach in the performance of a covenant or warranty which is
addressed in clause (ii) or (iii) above), and continuation of such default
or breach, for a period of 60 days after there has been given, by registered
or certified mail, to the defaulting Trustee or Trustees by the holders of
at least 25% in aggregate Liquidation Amount of the outstanding 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"
under the Trust Agreement; or

(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee and the failure by the Company to appoint a
successor Property Trustee within 60 days thereof.

Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of the Capital Securities, the
Administrative Trustees and the Company, unless such Event of Default shall have
been cured or waived. The Company and the Administrative Trustees are required
to file annually with the Property Trustee a certificate as to whether or not
they are in compliance with all the conditions and covenants applicable to them
under the Trust Agreement.

If a Debenture Event of Default has occurred and is continuing, the Capital
Securities shall have a preference over the Common Securities upon termination
of CFB Capital as described above. See "-- Liquidation Distribution Upon
Termination." Upon a Debenture Event of Default, unless the principal of all the
Junior Subordinated Debentures has already become due and payable, either the
Property Trustee or the holders of not less than 25% in aggregate principal
amount of the Junior Subordinated Debentures then outstanding may declare all of
the Junior Subordinated Debentures to be due and payable immediately by giving
notice in writing to the Company (and to the Property Trustee, if notice is
given by holders of the Junior Subordinated Debentures). If the Property Trustee
or the holders of the Junior Subordinated Debentures fail to declare the
principal of all of the Junior Subordinated Debentures due and payable upon a
Debenture Event of Default, the holders of at least 25% in Liquidation Amount of
the Capital Securities then outstanding shall have the right to declare the
Junior Subordinated Debentures immediately due and payable. In either event,
payment of principal and interest on the Junior Subordinated Debentures shall
remain subordinated to the extent provided in the Indenture. In addition,
holders of the Capital Securities have the right in certain circumstances to
bring a Direct Action (as hereinafter defined). See "Description of Junior
Subordinated Debentures -- Enforcement of Certain Rights by Holders of Capital
Securities."

REMOVAL OF TRUSTEES

Unless a Debenture Event of Default shall have occurred and be continuing,
any Trustee may be removed at any time by the holder of the Common Securities.
If a Debenture Event of Default has occurred and is continuing, the Property
Trustee and the Delaware Trustee may be removed at such time by the

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holders of a majority in Liquidation Amount of the outstanding Capital
Securities. In no event will the holders of the Capital Securities have the
right to vote to appoint, remove or replace the Administrative Trustees, which
voting rights are vested exclusively in the Company 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 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 Trust Property may at
the time be located, the Company, as the holder of the Common Securities, and
the Administrative Trustees shall have 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 the Trust Agreement. In case a Debenture Event of Default has
occurred and is continuing, the Property Trustee alone shall have power to make
such appointment.

MERGER OR CONSOLIDATION OF TRUSTEES

Any Person (as defined in the Trust Agreement) into which the Property
Trustee, the Delaware Trustee or any Administrative Trustee that is 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 corporation shall be otherwise
qualified and eligible.

MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF CFB CAPITAL

CFB Capital 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 Person, except as
described below. CFB Capital may, at the request of the Company, with the
consent of the Administrative Trustees and without the consent of the holders of
the Capital Securities, 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;
provided, that (i) such successor entity either (a) expressly assumes all of the
obligations of CFB Capital 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 rank the same as the Capital Securities rank in priority
with respect to distributions and payments upon liquidation, redemption and
otherwise, (ii) the Company expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee as the
holder of the Junior Subordinated Debentures, (iii) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause
adversely affect the rights, preferences and privileges of the holders of the
Capital Securities (including any Successor Securities) in any material respect,
(iv) such successor entity has a purpose identical to that of CFB Capital, (v)
the Successor Securities will be listed or traded on any national securities
exchange or other organization on which the Capital Securities may then be
listed, (vi) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, the Company has received an opinion from
independent counsel to CFB Capital experienced in such matters to the effect
that (a) such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not adversely affect the rights, preferences and
privileges of the holders of the Capital Securities (including any Successor
Securities) in any material respect, and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
CFB Capital nor such successor entity will be required to register as an
investment company under the Investment Company Act and (vii) the Company or any
permitted successor or designee owns all of the common securities of such
successor entity and guarantees the obligations of such successor entity under
the

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Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, CFB Capital shall not, except with the consent of
holders of 100% in Liquidation Amount 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 CFB Capital or the successor entity to be
classified as other than a grantor trust for United States federal income tax
purposes.

VOTING RIGHTS; AMENDMENT OF THE TRUST AGREEMENT

Except as provided below and under "Description of Guarantee -- Amendments
and Assignment" and as otherwise required by law and the Trust Agreement, the
holders of the Capital Securities will have no voting rights.

The Trust Agreement may be amended from time to time by the Company, the
Property Trustee and the Administrative Trustees, without the consent of the
holders of the Trust Securities, (i) to cure any ambiguity, correct or
supplement any provisions in the Trust Agreement that may be inconsistent with
any other provision, or to make any other provisions with respect to matters or
questions arising under the Trust Agreement, which shall not be inconsistent
with the other provisions of the Trust Agreement, or (ii) to modify, eliminate
or add to any provisions of the Trust Agreement to such extent as shall be
necessary to ensure that CFB Capital will be classified for United States
federal income tax purposes as a grantor trust at all times that any Trust
Securities are outstanding or to ensure that CFB Capital will not be required to
register as an "investment company" under the Investment Company Act; provided,
however, that in the case of clause (i), such action shall not adversely affect
in any material respect the interests of any holder of Trust Securities, and any
amendments of the Trust Agreement shall become effective when notice thereof is
given to the holders of the Trust Securities. The Trust Agreement may be amended
by the Trustees and the Company with (i) the consent of holders representing not
less than a majority of the aggregate Liquidation Amount of the outstanding
Trust Securities, and (ii) 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 CFB Capital's status
as a grantor trust for United States federal income tax purposes or CFB
Capital's exemption from status as an "investment company" under the Investment
Company Act, provided that without the consent of each holder of Trust
Securities, the Trust Agreement may not be amended to (i) change the amount or
timing of any Distribution on the Trust Securities or otherwise adversely affect
the amount of any Distribution required to be made in respect of the Trust
Securities as of a specified date or (ii) restrict the right of a holder of
Trust Securities to institute suit for the enforcement of any such payment on or
after such date.

So long as any Junior Subordinated Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Indenture Trustee, or
executing any trust or power conferred on the Property Trustee with respect to
the Junior Subordinated Debentures, (ii) waive any past default that is waivable
under the Indenture, (iii) exercise any right to rescind or annul a declaration
that the principal of all the Junior Subordinated Debentures shall be due and
payable or (iv) consent to any amendment, modification or termination of the
Indenture or the Junior Subordinated Debentures, where such consent shall be
required, without, in each case, obtaining the prior approval of the holders of
a majority in aggregate Liquidation Amount of all outstanding the Capital
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of Junior Subordinated Debentures affected
thereby, no such consent shall be given by the Property Trustee without the
prior consent of each holder of the Capital Securities. The Trustees shall not
revoke any action previously authorized or approved by a vote of the holders of
the Capital Securities except by subsequent vote of the holders of the Capital
Securities. The Property Trustee shall notify each holder of the Capital
Securities of any notice of default with respect to the Junior Subordinated
Debentures. In addition to obtaining the foregoing approvals of such holders of
the Capital Securities, prior to taking any of the

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foregoing actions, the Trustees shall obtain an opinion of counsel experienced
in such matters to the effect that CFB Capital will not be classified as an
association taxable as a corporation for United States federal income tax
purposes on account of such action.

Any required approval of holders of the Capital Securities may be given at a
meeting of holders of Capital Securities convened for such purpose or pursuant
to written consent. The Property Trustee will cause a notice of any meeting at
which holders of the Capital Securities are entitled to vote, or of any matter
upon which action by written consent of such holders is to be taken, to be given
to each holder of record of the Capital Securities in the manner set forth in
the Trust Agreement.

No vote or consent of the holders of the Capital Securities will be required
for CFB Capital to redeem and cancel the Capital Securities in accordance with
the Trust Agreement.

Notwithstanding that holders of the Capital Securities are entitled to vote
or consent under any of the circumstances described above, any of the Capital
Securities that are owned by the Company, the Trustees or any affiliate of the
Company or any Trustees, shall, for purposes of such vote or consent, be treated
as if they were not outstanding.

GLOBAL CAPITAL SECURITIES

The Capital Securities will be represented by one or more global
certificates registered in the name of the Depositary or its nominee ("Global
Capital Security"). Beneficial interests in the Capital Securities will be shown
on, and transfers thereof will be effected only through, records maintained by
participants in the Depositary. Except as described below, Capital Securities in
certificated form will not be issued in exchange for the global certificates.
See "Book-Entry Issuance."

A global security shall be exchangeable for Capital Securities registered in
the names of persons other than the Depositary or its nominee only if (i) the
Depositary notifies the Company that it is unwilling or unable to continue as a
depositary for such global security and no successor depositary shall have been
appointed, or if at any time the Depositary ceases to be a clearing agency
registered under the Securities Exchange Act of 1934, as amended, at a time when
the Depositary is required to be so registered to act as such depositary, (ii)
the Company in its sole discretion determines that such global security shall be
so exchangeable, or (iii) there shall have occurred and be continuing an Event
of Default under the Indenture. Any global security that is exchangeable
pursuant to the preceding sentence shall be exchangeable for definitive
certificates registered in such names as the Depositary shall direct. It is
expected that such instructions will be based upon directions received by the
Depositary with respect to ownership of beneficial interests in such global
security. In the event that Capital Securities are issued in definitive form,
such Capital Securities will be in denominations of $25 and integral multiples
thereof and may be transferred or exchanged at the offices described below.

Unless and until it is exchanged in whole or in part for the individual
Capital Securities represented thereby, a Global Capital Securities may not be
transferred except as a whole by the Depositary to a nominee of such the
Depositary or by a nominee of such the Depositary to such Depositary or another
nominee of such Depositary or by the Depositary or any nominee to a successor
Depositary or any nominee of such successor.

Payments on Capital Securities represented by a global security will be made
to the Depositary, as the depositary for the Capital Securities. In the event
the Capital Securities are issued in definitive form, Distributions will be
payable, the transfer of the Capital Securities will be registrable, and Capital
Securities will be exchangeable for Capital Securities of other denominations of
a like aggregate Liquidation Amount, at the corporate office of the Property
Trustee, or at the offices of any paying agent or transfer agent appointed by
the Administrative Trustees, provided that payment of any Distribution may be
made at the option of the Administrative Trustees by check mailed to the address
of the persons entitled thereto or by wire transfer. In addition, if the Capital
Securities are issued in certificated form, the record dates for

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payment of Distributions will be the 1st day of the month in which the relevant
Distribution Date occurs. For a description of the terms of the depositary
arrangements relating to payments, transfers, voting rights, redemptions and
other notices and other matters, see "Book-Entry Issuance."

Upon the issuance of a Global Capital Security, and the deposit of such
Global Capital Security with or on behalf of the Depositary, the Depositary for
such Global Capital Security or its nominee will credit, on its book-entry
registration and transfer system, the respective aggregate Liquidation Amounts
of the individual Capital Securities represented by such Global Capital
Securities to the accounts of Participants. Such accounts shall be designated by
the dealers, underwriters or agents with respect to such Capital Securities.
Ownership of beneficial interests in a Global Capital Security will be limited
to Participants or persons that may hold interests through Participants.
Ownership of beneficial interests in such Global Capital Security will be shown
on, and the transfer of that ownership will be effected only through, records
maintained by the applicable Depositary or its nominee (with respect to
interests of Participants) and the records of Participants (with respect to
interests of persons who hold through Participants). The laws of some states
require that certain purchasers of securities take physical delivery of such
securities in definitive form. Such limits and such laws may impair the ability
to transfer beneficial interests in a Global Capital Security.

So long as the Depositary for a Global Capital Security, or its nominee, is
the registered owners of such Global Capital Security, such Depositary or such
nominee, as the case may be, will be considered the sole owner or holder of the
Capital Securities represented by such Global Capital Security for all purposes
under the Trust Agreement governing such Capital Securities. Except as provided
below, owners of beneficial interests in a Global Capital Security will not be
entitled to have any of the individual Capital Securities represented by such
Global Capital Security registered in their names, will not receive or be
entitled to receive physical delivery of any such Capital Securities in
definitive form and will not be considered the owners or holders thereof under
the Trust Agreement.

None of the Company, the Property Trustee, any Paying Agent, or the
Securities Registrar (defined below) for such Capital Securities will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of the Global Capital
Security representing such Capital Securities or for maintaining supervising or
reviewing any records relating to such beneficial ownership interests.

The Company expects that the Depositary for Capital Securities or its
nominee, upon receipt of any payment of the Liquidation Amount or Distributions
in respect of a permanent Global Capital Security immediately will credit
Participants' accounts with payments in amounts proportionate to their
respective beneficial interest in the aggregate Liquidation Amount of such
Global Capital Security as shown on the records of such Depositary or its
nominee. The Company also expects that payments by Participants to owners of
beneficial interests in such Global Capital Security held through such
Participants will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers in bearer
form or registered in "street name." Such payments will be the responsibility of
such Participants.

If the Depositary for the Capital Securities is at any time unwilling,
unable or ineligible to continue as depositary and a successor depositary is not
appointed by the Company within 90 days, CFB Capital will issue individual
Capital Securities in exchange for the Global Capital Security. In addition, CFB
Capital may at any time and in its sole discretion, subject to any limitations
described herein relating to such Capital Securities, determine not to have any
Capital Securities represented by one or more Global Capital Securities and, in
such event, will issue individual Capital Securities in exchange for the Global
Capital Security or Securities representing the Capital Securities. Further, if
CFB Capital so specifies with respect to the Capital Securities, an owner of a
beneficial interest in a Global Capital Security representing Capital Securities
may, on terms acceptable to the Company, the Property Trustee and the Depositary
for such Global Capital Security, receive individual Capital Securities in
exchange for such beneficial interests, subject to any limitations described
herein. In any such instance, an owner of a beneficial interest in a Global

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Capital Security will be entitled to physical delivery of individual Capital
Securities represented by such Global Capital Security equal in Liquidation
Amount to such beneficial interest and to have such Capital Securities
registered in its name. Individual Capital Securities so issued will be issued
in denominations, unless otherwise specified by CFB Capital, of $25 and integral
multiples thereof.

PAYMENT AND PAYING AGENCY

Payments in respect of the Capital Securities shall be made to the
Depositary, which shall credit the relevant accounts at the Depositary on the
applicable Distribution Dates or, if any of the Capital Securities are not held
by the Depositary, such payments shall be made by check mailed to the address of
the holder entitled thereto as such address shall appear on the Register. The
paying agent (the "Paying Agent") shall initially be the Property Trustee and
any co-paying agent chosen by the Property Trustee and acceptable to the
Administrative Trustees and the Company. The Paying Agent shall be permitted to
resign as Paying Agent upon 30 days' written notice to the Property Trustee and
the Company. In the event that the Property Trustee shall no longer be the
Paying Agent, the Administrative Trustees shall appoint a successor (which shall
be a bank or trust company acceptable to the Administrative Trustees and the
Company) to act as Paying Agent.

REGISTRAR AND TRANSFER AGENT

The Property Trustee will act as registrar and transfer agent for the
Capital Securities. Registration of transfers of the Capital Securities will be
effected without charge by or on behalf of CFB Capital, but upon payment of any
tax or other governmental charges that may be imposed in connection with any
transfer or exchange. CFB Capital will not be required to register or cause to
be registered the transfer of the Capital Securities after such Capital
Securities have been called for redemption.

INFORMATION CONCERNING THE PROPERTY TRUSTEE

The Properly Trustee, other than upon the occurrence and during the
continuance of an Event of Default, undertakes to perform only such duties as
are specifically set forth in the Trust Agreement and, after such Event of
Default, must exercise the same degree of care and skill as a prudent person
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 the Trust Agreement at the request of any holder of
Capital Securities unless it is offered reasonable indemnity against the costs,
expenses and liabilities that might be incurred thereby. If no Event of Default
has occurred and is continuing and the Property Trustee is required to decide
between alternative causes of action, construe ambiguous provisions in the Trust
Agreement or is unsure of the application of any provision of the Trust
Agreement, and the matter is not one on which holders of the Capital Securities
are entitled under the Trust Agreement to vote, then the Property Trustee shall
take such action as is directed by the Company and if not so directed, shall
take such action as 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.

MISCELLANEOUS

The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate CFB Capital in such a way that CFB Capital will not be
deemed to be an "investment company" required to be registered under the
Investment Company Act or classified as an association taxable as a corporation
for United States federal income tax purposes and so that the Junior
Subordinated Debentures will be treated as indebtedness of the Company for
United States federal income tax purposes. In this connection, the Company and
the Administrative Trustees are authorized to take any action, not inconsistent
with applicable law, the certificate of trust of CFB Capital or the Trust
Agreement, that the Company and the Administrative Trustees determine in their
discretion to be necessary or desirable for such purposes, as long as such
action does not materially adversely affect the interests of the holders of the
related Capital Securities. Holders of the Capital Securities have no preemptive
or similar rights.

CFB Capital may not borrow money or issue debt or mortgage or pledge any of
its assets.

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DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES

The Junior Subordinated Debentures will be issued under the Subordinated
Indenture, dated as of February , 1997 (the "Indenture"), between the Company
and Wilmington Trust Company, as trustee (the "Indenture Trustee"). The
following summary of the terms and provisions of the Junior Subordinated
Debentures and the Indenture does not purport to be complete and is subject to,
and is qualified in its entirety by reference to, the Indenture, which has been
filed as an exhibit to the Registration Statement of which this Prospectus forms
a part, and to the Trust Indenture Act. The Indenture is qualified under the
Trust Indenture Act. Whenever particular defined terms of the Indenture are
referred to herein, such defined terms are incorporated herein or therein by
reference.

Concurrently with the issuance of the Capital Securities, CFB Capital will
invest the proceeds thereof, together with the consideration paid by the Company
for the Common Securities, in Junior Subordinated Debentures issued by the
Company. The Junior Subordinated Debentures will be issued as unsecured debt
under the Indenture.

GENERAL

The Junior Subordinated Debentures will bear interest at the annual rate of
% of the principal amount thereof, payable quarterly in arrears on the 15th
day of April, July, October and January of each year (each, an "Interest Payment
Date"), commencing April 15, 1997, to the person in whose name each Subordinated
Debenture is registered, subject to certain exceptions, at the close of business
on the Business Day next preceding such Interest Payment Date. Notwithstanding
the above, in the event that either the (i) Junior Subordinated Debentures are
held by the Property Trustee and the Capital Securities are no longer in
book-entry only form or (ii) the Junior Subordinated Debentures are not
represented by a Global Subordinated Debenture (as defined herein), the record
date for such payment shall be the 1st day of the month in which such payment is
made. The amount of each interest payment due with respect to the Junior
Subordinated Debentures will include amounts accrued through the date the
interest payment is due. It is anticipated that, until the liquidation, if any,
of CFB Capital, each Junior Subordinated Debenture will be held in the name of
the Property Trustee in trust for the benefit of the holders of the Capital
Securities. The amount of interest payable for any period will be computed on
the basis of a 360-day year of twelve 30-day months. In the event that any date
on which interest is payable on the Junior Subordinated Debentures is not a
Business Day, then payment of the interest payable on such date will be made on
the next Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date such
payment was originally payable. Accrued interest that is not paid on the
applicable Interest Payment Date will bear additional interest on the amount
thereof (to the extent permitted by law) at the rate per annum of % thereof,
compounded quarterly. The term "interest" as used herein shall include quarterly
interest payments, interest on quarterly interest payments not paid on the
applicable Interest Payment Date and Additional Sums (as defined below), as
applicable.

The Junior Subordinated Debentures will mature on February 1, 2027 (such
date, as it may be shortened as hereinafter described, the "Stated Maturity").
Such date may be shortened once at any time by the Company to any date not
earlier than February 1, 2002, subject to the Company having received prior
approval of the Federal Reserve if then required under applicable capital
guidelines or policies of the Federal Reserve. In the event that the Company
elects to shorten the Stated Maturity of the Junior Subordinated Debentures, it
shall give notice to the Indenture Trustee, and the Indenture Trustee shall give
notice of such shortening or extension to the holders of the Junior Subordinated
Debentures no less than 90 days prior to the effectiveness thereof.

The Junior Subordinated Debentures will be unsecured and will rank junior
and be subordinate in right of payment to all Senior and Subordinated Debt of
the Company. Because the Company is a holding company, the right of the Company
to participate in any distribution of assets of any subsidiaries, including

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the Company's Banks, upon any such subsidiaries' liquidation or reorganization
or otherwise (and thus the ability of holders of the Capital Securities to
benefit indirectly from such distribution), is subject to the prior claims of
creditors of that subsidiary, except to the extent that the Company may itself
be recognized as a creditor of that subsidiary. Accordingly, the Junior
Subordinated Debentures will be effectively subordinated to all existing and
future liabilities of the Company's subsidiaries, and holders of Junior
Subordinated Debentures should look only to the assets of the Company for
payments on the Junior Subordinated Debentures. The Indenture does not limit the
incurrence or issuance of other secured or unsecured debt of the Company,
including Senior and Subordinated Debt, whether under the Indenture or any
existing or other indenture that the Company may enter into in the future or
otherwise. See "Subordination" below.

OPTION TO EXTEND INTEREST PAYMENT PERIOD

So long as no Debenture Event of Default has occurred and is continuing, the
Company has the right under the Indenture at any time during the term of the
Junior Subordinated Debentures to defer the payment of interest at any time or
from time to time for a period not exceeding 20 consecutive quarters (each such
period an "Extension Period"), provided that no Extension Period may extend
beyond the Stated Maturity. At the end of such Extension Period, the Company
must pay all interest then accrued and unpaid (together with interest thereon at
the annual rate of %, compounded quarterly, to the extent permitted by
applicable law). During an Extension Period, interest will continue to accrue
and holders of Junior Subordinated Debentures will be required to accrue
interest income for United States federal income tax purposes. See "Certain
Federal Income Tax Consequences -- Potential Extension of Interest Payment
Period and Original Issue Discount."

During any such Extension Period, the Company may not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock or (ii)
make any payment of principal, interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Company (including other Junior
Subordinated Debentures) that rank PARI PASSU with or junior in interest to the
Junior Subordinated Debentures or make any guarantee payments with respect to
any guarantee by the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks PARI PASSU with or junior in interest to the
Junior Subordinated Debentures (other than (a) dividends or distributions in
common stock of the Company, (b) any declaration of a dividend in connection
with the implementation of a stockholders' rights plan, or the issuance of stock
under any such plan in the future, or the redemption or repurchase of any such
rights pursuant thereto, (c) payments under the Guarantee, and (d) purchases of
common stock related to rights under any of the Company's benefit plans for its
directors, officers or employees). Prior to the termination of any such
Extension Period, the Company may further extend such Extension Period, provided
that such extension does not cause such Extension Period to exceed 20
consecutive quarters or extend beyond the Stated Maturity. Upon the termination
of any such Extension Period and the payment of all amounts then due on any
Interest Payment Date, the Company may elect to begin a new Extension Period
subject to the above requirements. No interest shall be due and payable during
an Extension Period, except at the end thereof. The Company must give the
Property Trustee, the Administrative Trustees and the Indenture Trustee notice
of its election of any Extension Period at least one Business Day prior to the
earlier of (i) the date the Distributions on the Capital Securities would have
been payable except for the election to begin or extend such Extension Period or
(ii) the date the Administrative Trustees are required to give notice to the
holders of the Capital Securities of the record date or the date such
Distributions are payable, but in any event not less than one Business Day prior
to such record date. The Indenture Trustee shall give notice of the Company's
election to begin or extend a new Extension Period the holders of the Capital
Securities. There is no limitation on the number of times that the Company may
elect to begin an Extension Period.

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ADDITIONAL SUMS

If CFB Capital is required to pay any additional taxes, duties or other
governmental charges as a result of a Tax Event, the Company will pay as
additional amounts on the Junior Subordinated Debentures such amounts
("Additional Sums") as shall be required so that the Distributions payable by
CFB Capital shall not be reduced as a result of any such additional taxes,
duties or other governmental charges.

REDEMPTION

Subject to the Company having received prior approval of the Federal
Reserve, if then required under applicable capital guidelines or policies of the
Federal Reserve, the Junior Subordinated Debentures are redeemable prior to
maturity at the option of the Company (i) on or after February 1, 2002, in whole
at any time or in part from time to time, or (ii) at any time in whole (but not
in part), upon the occurrence and during the continuance of a Tax Event, an
Investment Company Event or a Capital Treatment Event, in each case at a
redemption price equal to the accrued and unpaid interest on the Junior
Subordinated Debentures so redeemed to the date fixed for redemption, plus 100%
of the principal amount thereof.

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
Debentures to be redeemed at such holder's registered address. Unless the
Company defaults in payment of the redemption price, on and after the redemption
date interest ceases to accrue on such Junior Subordinated Debentures or
portions thereof called for redemption.

The Junior Subordinated Debentures will not be subject to any sinking fund.

DISTRIBUTION UPON LIQUIDATION

As described under "Description of the Capital Securities -- Liquidation
Distribution Upon Termination," under certain circumstances involving the
termination of CFB Capital, the Junior Subordinated Debentures may be
distributed to the holders of the Capital Securities in liquidation of CFB
Capital after satisfaction of liabilities to creditors of CFB Capital as
provided by applicable law. If distributed to holders of the Capital Securities
in liquidation, the Junior Subordinated Debentures will initially be issued in
the form of one or more global securities and the Depositary, or any successor
depositary for the Capital Securities, will act as depositary for the Junior
Subordinated Debentures. It is anticipated that the depositary arrangements for
the Junior Subordinated Debentures would be substantially identical to those in
effect for the Capital Securities. If the Junior Subordinated Debentures are
distributed to the holders of Capital Securities upon the liquidation of CFB
Capital, there can be no assurance as to the market price of any Junior
Subordinated Debentures that may be distributed to the holders of Capital
Securities.

RESTRICTIONS ON CERTAIN PAYMENTS

If at any time (i) there shall have occurred any event of which the Company
has actual knowledge that (a) with the giving of notice or the lapse of time, or
both, would constitute a Debenture Event of Default and (b) in respect of which
the Company shall not have taken reasonable steps to cure, or (ii) the Company
shall have given notice of its election of an Extension Period as provided in
the Indenture with respect to the Junior Subordinated Debentures and shall not
have rescinded such notice, or such Extension Period, or any extension thereof,
shall be continuing, or (iii) while the Junior Subordinated Debentures are held
by CFB Capital, the Company shall be in default with respect to its payment of
any obligation under the Guarantee, then the Company will not (1) declare or pay
any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock or (2)
make any payment of principal, interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Company (including other Junior
Subordinated Debt) that rank pari passu with or junior in interest to the Junior
Subordinated Debentures or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any subsidiary of the Company
if such guarantee ranks pari passu or junior in interest to the Junior
Subordinated Debentures (other than (a) dividends or distributions in Common
Stock, (b) any declaration of a dividend in connection with the implementation
of a stockholders' rights plan,

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or the issuance of stock under any such plan in the future or the redemption or
repurchase of any such rights pursuant thereto, (c) payments under the Guarantee
and (d) purchases of Common Stock related to rights under any of the Company's
benefit plans for its directors, officers or employees).

SUBORDINATION

In the Indenture, the Company has covenanted and agreed that any Junior
Subordinated Debentures issued thereunder will be subordinate and junior in
right of payment to all Senior and Subordinated Debt to the extent provided in
the Indenture. Upon any payment or distribution of assets to creditors upon any
liquidation, dissolution, winding up, reorganization, assignment for the benefit
of creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Company, the holders of Senior and Subordinated
Debt will first be entitled to receive payment in full of principal of (and
premium, if any) and interest, if any, on such Senior and Subordinated Debt
before the holders of Junior Subordinated Debentures will be entitled to receive
or retain any payment in respect of the principal of or interest, if any, on the
Junior Subordinated Debentures.

In the event of the acceleration of the maturity of any Junior Subordinated
Debentures, the holders of all Senior and Subordinated Debt outstanding at the
time of such acceleration will first be entitled to receive payment in full of
all amounts due thereon (including any amounts due upon acceleration) before the
holders of Junior Subordinated Debentures will be entitled to receive or retain
any payment in respect of the principal of or interest, if any, on the Junior
Subordinated Debentures; provided, however, that holders of Subordinated Debt
shall not be entitled to receive payment of any such amounts to the extent that
such Subordinated Debt is by its terms subordinated to trade creditors.

No payments on account of principal or interest, if any, in respect of the
Junior Subordinated Debentures may be made if there shall have occurred and be
continuing a default in any payment with respect to Senior and Subordinated Debt
or an event of default with respect to any Senior and Subordinated Debt
resulting in the acceleration of the maturity thereof, or if any judicial
proceeding shall be pending with respect to any such default.

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

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holders of such Debt by the holders of the Junior Subordinated Debentures as a
result of the subordination provisions of the Indenture would be greater than
they otherwise would have been as a result of any obligation of such holders to
pay amounts over to the obligees on such trade accounts payable or accrued
liabilities arising in the ordinary course of business as a result of
subordination provisions to which such Debt is subject, (v) the Guarantee, and
(vi) any other debt securities issued pursuant to the Indenture.

The Indenture places no limitation on the amount of additional Senior and
Subordinated Debt that may be incurred by the Company. The Company expects from
time to time to incur additional indebtedness constituting Senior and
Subordinated Debt.

DENOMINATIONS, REGISTRATION AND TRANSFER

The Junior Subordinated Debentures will be represented by global
certificates registered in the name of the Depositary or its nominee ("Global
Subordinated Debenture"). Beneficial interests in the Junior Subordinated
Debentures will be shown on, and transfers thereof will be effected only
through, records maintained by the Depositary. Except as described below, Junior
Subordinated Debentures in certificated form will not be issued in exchange for
the global certificates. See "Book-Entry Issuance."

Unless and until a Global Subordinated Debenture is exchanged in whole or in
part for the individual Junior Subordinated Debentures represented thereby, it
may not be transferred except as a whole by the Depositary for such Global
Subordinated Debenture to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by the
Depositary or any nominee to a successor Depositary or any nominee of such
successor.

A global security shall be exchangeable for Junior Subordinated Debentures
registered in the names of persons other than the Depositary or its nominee only
if (i) the Depositary notifies the Company that it is unwilling or unable to
continue as a depositary for such global security and no successor depositary
shall have been appointed, or if at any time the Depositary ceases to be a
clearing agency registered under the Securities Exchange Act of 1934, as
amended, at a time when the Depositary is required to be so registered to act as
such depositary, (ii) the Company in its sole discretion determines that such
global security shall be so exchangeable or (iii) there shall have occurred and
be continuing an Event of Default under the Indenture with respect to such
global security. Any global security that is exchangeable pursuant to the
preceding sentence shall be exchangeable for definitive certificates registered
in such names as the Depositary shall direct. It is expected that such
instructions will be based upon directions received by the Depositary from its
Participants with respect to ownership of beneficial interests in such global
security. In the event that Junior Subordinated Debentures are issued in
definitive form, such Junior Subordinated Debentures will be in denominations of
$25 and integral multiples thereof and may be transferred or exchanged at the
offices described below.

Payments on Junior Subordinated Debentures represented by a global security
will be made to the Depositary, as the depositary for the Junior Subordinated
Debentures. In the event Junior Subordinated Debentures are issued in definitive
form, principal and interest will be payable, the transfer of the Junior
Subordinated Debentures will be registrable, and Junior Subordinated Debentures
will be exchangeable for Junior Subordinated Debentures of other denominations
of a like aggregate principal amount, at the corporate office of the Indenture
Trustee, or at the offices of any paying agent or transfer agent appointed by
the Company, provided that payment of interest may be made at the option of the
Company by check mailed to the address of the persons entitled thereto or by
wire transfer. In addition, if the Junior Subordinated Debentures are issued in
certificated form, the record dates for payment of interest will be the 1st day
of the month in which such payment is to be made. For a description of the
Depositary and the terms of the depositary arrangements relating to payments,
transfers, voting rights, redemptions and other notices and other matters, see
"Book-Entry Issuance."

The Company will appoint the Indenture Trustee as securities registrar under
the Indenture (the "Securities Registrar"). Junior Subordinated Debentures may
be presented for exchange as provided above, and may be presented for
registration of transfer (with the form of transfer endorsed thereon, or a

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satisfactory written instrument of transfer, duly executed), at the office of
the Securities Registrar. The Company may at any time rescind the designation of
any such transfer agent or approve a change in the location through which any
such transfer agent acts, provided that the Company maintains a transfer agent
in the place of payment. The Company may at any time designate additional
transfer agents with respect to the Junior Subordinated Debentures.

In the event of any redemption, neither the Company nor the Indenture
Trustee shall be required to (i) issue, register the transfer of or exchange
Junior Subordinated Debentures during a period beginning at the opening of
business 15 days before the day of selection for redemption of Junior
Subordinated Debentures and ending at the close of business on the day of
mailing of the relevant notice of redemption or (ii) transfer or exchange any
Junior Subordinated Debentures so selected for redemption, except, in the case
of any Junior Subordinated Debentures being redeemed in part, any portion
thereof not to be redeemed.

GLOBAL JUNIOR SUBORDINATED DEBENTURES

Upon the issuance of the Global Subordinated Debenture, and the deposit of
such Global Subordinated Debenture with or on behalf of the Depositary, the
Depositary for such Global Subordinated Debenture or its nominee will credit, on
its book-entry registration and transfer system, the respective principal
amounts of the individual Junior Subordinated Debentures represented by such
Global Subordinated Debenture to the accounts of persons that have accounts with
such Depositary ("Participants"). Ownership of beneficial interests in a Global
Subordinated Debenture will be limited to Participants or persons that may hold
interests through Participants. Ownership of beneficial interests in such Global
Subordinated Debenture will be shown on, and the transfer of that ownership will
be effected only through, records maintained by the applicable Depositary or its
nominee (with respect to interests of Participants) and the records of
Participants (with respect to interests of persons who hold through
Participants). The laws of some states require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to transfer beneficial interests in
a Global Subordinated Debenture.

So long as the Depositary for a Global Subordinated Debenture, or its
nominee, is the registered owner of such Global Subordinated Debenture, such
Depositary or such nominee, as the case may be, will be considered the sole
owner or holder of the Junior Subordinated Debentures represented by such Global
Subordinated Debenture for all purposes under the Indenture governing such
Junior Subordinated Debentures. Except as provided below, owners of beneficial
interests in a Global Subordinated Debenture will not be entitled to have any of
the individual Junior Subordinated Debentures represented by such Global
Subordinated Debenture registered in their names, will not receive or be
entitled to receive physical delivery of any such Junior Subordinated Debentures
in definitive form and will not be considered the owners or holders thereof
under the Indenture.

Payments of principal of and interest on individual Junior Subordinated
Debentures represented by a Global Subordinated Debenture registered in the name
of the Depositary or its nominee will be made to the Depositary or its nominee,
as the case may be, as the registered owner of the Global Subordinated Debenture
representing such Junior Subordinated Debentures. None of the Company, the
Indenture Trustee, any Paying Agent, or the Securities Registrar for such Junior
Subordinated Debentures will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial ownership
interests of the Global Subordinated Debenture representing such Junior
Subordinated Debentures or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.

The Company expects that the Depositary or its nominee, upon receipt of any
payment of principal or interest in respect of a permanent Global Subordinated
Debenture representing the Junior Subordinated Debentures, immediately will
credit Participants' accounts with payments in amounts proportionate to their
respective beneficial interest in the principal amount of the Global
Subordinated Debenture as shown on the records of such Depositary or its
nominee. The Company also expects that payments by Participants to owners of
beneficial interests in such Global Subordinated Debenture held through such
Participants will be

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governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers in bearer form or registered
in "street name." Such payments will be the responsibility of such Participants.

If the Depositary is at any time unwilling, unable or ineligible to continue
as depositary and a successor depositary is not appointed by the Company within
90 days, the Company will issue individual Junior Subordinated Debentures in
exchange for the Global Subordinated Debenture. In addition, the Company may at
any time and in its sole discretion, determine not to have the Junior
Subordinated Debentures represented by one or more Global Junior Subordinated
Debentures and, in such event, will issue individual Junior Subordinated
Debentures in exchange for the Global Subordinated Debenture. Further, if the
Company so specifies with respect to the Junior Subordinated Debentures, an
owner of a beneficial interest in a Global Subordinated Debenture representing
Junior Subordinated Debentures may, on terms acceptable to the Company, the
Indenture Trustee and the Depositary for such Global Subordinated Debenture,
receive individual Junior Subordinated Debentures in exchange for such
beneficial interests. In any such instance, an owner of a beneficial interest in
a Global Subordinated Debenture will be entitled to physical delivery of
individual Junior Subordinated Debentures equal in principal amount to such
beneficial interest and to have such Junior Subordinated Debentures registered
in its name. Individual Junior Subordinated Debentures so issued will be issued
in denominations, unless otherwise specified by the Company, of $25 and integral
multiples thereof.

PAYMENT AND PAYING AGENTS

Payment of principal of and any interest on the Junior Subordinated
Debentures will be made at the office of the Indenture Trustee, except that at
the option of the Company payment of any interest may be made (i) except in the
case of Global Junior Subordinated Debentures, by check mailed to the address of
the person entitled thereto as such address shall appear in the securities
register or (ii) by transfer to an account maintained by the person entitled
thereto as specified in the securities register, provided that proper transfer
instructions have been received by the regular record date. Payment of any
interest on Junior Subordinated Debentures will be made to the person in whose
name such Junior Subordinated Debenture is registered at the close of business
on the regular record date for such interest. The Company may at any time
designate additional Paying Agents or rescind the designation of any Paying
Agent; however the Company will at all times be required to maintain a Paying
Agent in each place of payment for the Junior Subordinated Debentures.

Any moneys deposited with the Indenture Trustee or any Paying Agent, or then
held by the Company in trust, for the payment of the principal of or interest on
the Junior Subordinated Debentures and remaining unclaimed for two years after
such principal or interest has become due and payable shall, at the request of
the Company, be repaid to the Company and the holder of such Junior Subordinated
Debenture shall thereafter look, as a general unsecured creditor, only to the
Company for payment thereof.

MODIFICATION OF INDENTURE

From time to time the Company and the Indenture Trustee may, without the
consent of the holders of the Junior Subordinated Debentures, amend, waive or
supplement the Indenture for specified purposes, including, among other things,
curing ambiguities, defects or inconsistencies (provided that any such action
does not materially adversely affect the interests of the holders of the Junior
Subordinated Debentures or the Capital Securities so long as they remain
outstanding) and qualifying, or maintaining the qualification of, the Indenture
under the Trust Indenture Act. The Indenture contains provisions permitting the
Company and the Indenture Trustee, with the consent of the holders of not less
than a majority in principal amount of the outstanding Junior Subordinated
Debentures, to modify the Indenture in a manner affecting the rights of the
holders of the Junior Subordinated Debentures; provided, that no such
modification may, without the consent of the holder of each outstanding
Subordinated Debenture, (i) change the Stated Maturity of the Junior
Subordinated Debentures, or reduce the principal amount thereof, or reduce the
rate or extend the

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time of payment of interest thereon or (ii) reduce the percentage of principal
amount of Junior Subordinated Debentures, the holders of which are required to
consent to any such modification of the Indenture, provided that so long as any
of the Capital Securities remain outstanding, no such modification may be made
that adversely affects the holders of such Capital Securities in any material
respect, and no termination of the Indenture may occur, and no waiver of any
Debenture Event of Default or compliance with any covenant under the Indenture
may be effective, without the prior consent of the holders of at least a
majority of the aggregate Liquidation Amount of the Capital Securities unless
and until the principal of the Junior Subordinated Debentures and all accrued
and unpaid interest thereon have been paid in full and certain other conditions
are satisfied.

DEBENTURE EVENTS OF DEFAULT

The Indenture provides that any one or more of the following described
events with respect to the Junior Subordinated Debentures that has occurred and
is continuing constitutes a "Debenture Event of Default" with respect to the
Junior Subordinated Debentures:

(i) failure for 30 days to pay any interest on the Junior Subordinated
Debentures, when due (subject to the deferral of any due date in the case of
an Extension Period); or

(ii) failure to pay any principal on the Junior Subordinated Debentures
when due whether at maturity, upon redemption by declaration or otherwise;
or

(iii) failure to observe or perform in any material respect certain other
covenants contained in the Indenture for 90 days after written notice to the
Company from the Indenture Trustee or to the Company and the Indenture
Trustee by the holders of at least 25% in aggregate outstanding principal
amount of the Junior Subordinated Debentures; or

(iv) certain events in bankruptcy, insolvency or reorganization of the
Company.

The holders of a majority in aggregate outstanding principal amount of the
Junior Subordinated Debentures have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Indenture
Trustee. The Indenture Trustee or the holders of not less than 25% in aggregate
outstanding principal amount of the Junior Subordinated Debentures may declare
the principal due and payable immediately upon a Debenture Event of Default. The
holders of a majority in aggregate outstanding principal amount of the Junior
Subordinated Debentures may annul such declaration and waive the default if the
default (other than the non-payment of the principal of the Junior Subordinated
Debentures which has become due solely by such acceleration) has been cured and
a sum sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the Indenture Trustee.
Should the holders of the Junior Subordinated Debentures fail to annul such
declaration and waive such default, the holders of a majority in aggregate
Liquidation Amount of the Capital Securities shall have such right.

In case a Debenture Event of Default shall occur and be continuing as to the
Junior Subordinated Debentures, the Property Trustee will have the right to
declare the principal of and the interest on such Junior Subordinated
Debentures, and any other amounts payable under the Indenture, to be forthwith
due and payable and to enforce its other rights as a creditor with respect to
such Junior Subordinated Debentures.

The Company is required to file annually with the Indenture Trustee a
certificate as to whether or not the Company is in compliance with all the
conditions and covenants applicable to it under the Indenture.

ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES

If a Debenture Event of Default has occurred and is continuing and such
event is attributable to the failure of the Company to pay interest or principal
on the Junior Subordinated Debentures on the date such interest or principal is
otherwise payable, a holder of Capital Securities may institute a legal
proceeding directly against the Company for enforcement of payment to such
holder of the principal of or interest on

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such Junior Subordinated Debentures having a principal amount equal to the
aggregate Liquidation Amount of the Capital Securities of such holder ("Direct
Action"). If the right to bring a Direct Action is removed, CFB Capital may
become subject to the reporting obligations under the Exchange Act. The Company
shall have the right under the Indenture to set-off any payment made to such
holder of Capital Securities by the Company in connection with a Direct Action.

The holders of the Capital Securities would not be able to exercise directly
any remedies other than those set forth in the preceding paragraph available to
the holders of the Junior Subordinated Debentures unless there shall have been
an Event of Default under the Trust Agreement. See "Description of Capital
Securities -- Events of Default; Notice."

CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS

The Indenture provides that the Company shall not 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 Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless (i) in case the Company
consolidates with or merges into another Person or conveys or transfers its
properties and assets substantially as an entirety to any Person, the successor
Person is organized under the laws of the United States or any state or the
District of Columbia, and such successor Person expressly assumes the Company's
obligations on the Junior Subordinated Debentures issued under the Indenture;
(ii) immediately after giving effect thereto, no Debenture Event of Default, and
no event which, after notice or lapse of time or both, would become a Debenture
Event of Default, shall have occurred and be continuing; and (iii) certain other
conditions as prescribed in the Indenture are met.

The general provisions of the Indenture do not afford holders of the Junior
Subordinated Debentures protection in the event of a highly leveraged or other
transaction involving the Company that may adversely affect holders of the
Junior Subordinated Debentures.

SATISFACTION AND DISCHARGE

The Indenture provides that when, among other things, all Junior
Subordinated Debentures not previously delivered to the Indenture Trustee for
cancellation (i) have become due and payable or (ii) will become due and payable
at their Stated Maturity within one year, and the Company deposits or causes to
be deposited with the Indenture Trustee trust funds, in trust, for the purpose
and in an amount in the currency or currencies in which the Junior Subordinated
Debentures are payable sufficient to pay and discharge the entire indebtedness
on the Junior Subordinated Debentures not previously delivered to the Indenture
Trustee for cancellation, for the principal and interest to the date of the
deposit or to the Stated Maturity, as the case may be, then the Indenture will
cease to be of further effect (except as to the Company's obligations to pay all
other sums due pursuant to the Indenture and to provide the officers'
certificates and opinions of counsel described therein), and the Company will be
deemed to have satisfied and discharged the Indenture.

GOVERNING LAW

The Indenture and the Junior Subordinated Debentures will be governed by and
construed in accordance with the laws of the State of Minnesota.

INFORMATION CONCERNING THE INDENTURE TRUSTEE

The Indenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to such provisions, the Indenture Trustee is under no
obligation to exercise any of the powers vested in it by the Indenture at the
request of any holder of Junior Subordinated Debentures, unless offered
reasonable indemnity by such holder against the costs, expenses and liabilities
which might be incurred thereby. The Indenture Trustee is not required to expend
or risk its own funds or otherwise incur personal financial liability in the
performance of its duties if the Indenture Trustee reasonably believes that
repayment or adequate indemnity is not reasonably assured to it.

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COVENANTS OF THE COMPANY

The Company will covenant in the Indenture, as to the Junior Subordinated
Debentures, that if and so long as (i) CFB Capital is the holder of all such
Junior Subordinated Debentures, (ii) a Tax Event in respect of CFB Capital has
occurred and is continuing and (iii) the Company has elected, and has not
revoked such election, to pay Additional Sums (as defined under "Description of
the Capital Securities -- Redemption") in respect of the Capital Securities, the
Company will pay to CFB Capital such Additional Sums. The Company will also
covenant, as to the Junior Subordinated Debentures, (i) to maintain directly or
indirectly 100% ownership of the Common Securities of CFB Capital to which
Junior Subordinated Debentures have been issued, provided that certain
successors which are permitted pursuant to the Indenture may succeed to the
Company's ownership of the Common Securities, (ii) not to voluntarily terminate,
wind up or liquidate CFB Capital, except upon prior approval of the Federal
Reserve if then so required under applicable capital guidelines or policies of
the Federal Reserve, and except (a) in connection with a distribution of Junior
Subordinated Debentures to the holders of the Capital Securities in liquidation
of CFB Capital 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 CFB Capital to remain classified as a grantor trust and not as an
association taxable as a corporation for United States federal income tax
purposes.

BOOK-ENTRY ISSUANCE

The Depositary will act as securities depositary for all of the Capital
Securities and the Junior Subordinated Debentures. The Capital Securities and
the Junior Subordinated Debentures will be issued only as fully-registered
securities registered in the name of Cede & Co. (the Depositary's nominee). One
or more fully-registered global certificates will be issued for the Capital
Securities and the Junior Subordinated Debentures and will be deposited with the
Depositary.

The Depositary 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 Exchange
Act. The Depositary holds securities that its Participants deposit with the
Depositary. The Depositary also facilitates the settlement among Participants of
securities transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in Participants' accounts,
thereby eliminating the need for physical movement of securities certificates.
"Direct Participants" include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations. The Depositary
is owned by a number of its Direct Participants and by the New York Stock
Exchange, Inc., the American Stock Exchange, Inc. and the National Association
of Securities Dealers, Inc. Access to the Depositary system is also available to
others such as securities brokers and dealers, banks and trust companies that
clear through or maintain custodial relationships with Direct Participants,
either directly or indirectly ("Indirect Participants"). The rules applicable to
the Depositary and its Participants are on file with the Commission.

Purchases of Capital Securities or Junior Subordinated Debentures within the
Depositary system must be made by or through Direct Participants, which will
receive a credit for the Capital Securities or Junior Subordinated Debentures on
the Depositary's records. The ownership interest of each actual purchaser of
each Capital Securities and each Subordinated Debenture ("Beneficial Owner") is
in turn to be recorded on the Direct and Indirect Participants' records.
Beneficial Owners will not receive written confirmation from the Depositary of
their purchases, but Beneficial Owners are expected to receive written
confirmations providing details of the transactions, as well as periodic
statements of their holdings, from the Direct or Indirect Participants through
which the Beneficial Owners purchased Capital Securities or Junior Subordinated
Debentures. Transfers of ownership interests in the Capital Securities or Junior
Subordinated Debentures are to be accomplished by entries made on the books of
Participants acting on behalf of Beneficial

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Owners. Beneficial Owners will not receive certificates representing their
ownership interests in Capital Securities or Junior Subordinated Debentures,
except in the event that use of the book-entry system for the or Junior
Subordinated Debentures is discontinued.

The Depositary has no knowledge of the actual Beneficial Owners of the
Capital Securities or Junior Subordinated Debentures; the Depositary's records
reflect only the identity of the Direct Participants to whose accounts such
Capital Securities or Junior Subordinated Debentures are credited, which may or
may not be the Beneficial Owners. The Participants will remain responsible for
keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by the Depositary to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners and the voting
rights of Direct Participants, Indirect Participants and Beneficial Owners will
be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.

Redemption notices will be sent to Cede & Co. as the registered holder of
the Capital Securities or Junior Subordinated Debentures. If less than all of
the Capital Securities or the Junior Subordinated Debentures are being redeemed,
the Depositary will determine by lot or pro rata the amount of the Capital
Securities of each Direct Participant to be redeemed.

Although voting with respect to the Capital Securities or the Junior
Subordinated Debentures is limited to the holders of record of the Capital
Securities Junior Subordinated Debentures, in those instances in which a vote is
required, neither the Depositary nor Cede & Co. will itself consent or vote with
respect to Capital Securities or Junior Subordinated Debentures. Under its usual
procedures, the Depositary would mail an omnibus proxy (the "Omnibus Proxy") to
the relevant Trustee 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 Capital Securities or Junior Subordinated
Debentures are credited on the record date (identified in a listing attached to
the Omnibus Proxy).

Distribution payments on the Capital Securities or the Junior Subordinated
Debentures will be made by the relevant Trustee to the Depositary. The
Depositary's practice is to credit Direct Participants' accounts on the relevant
payment date in accordance with their respective holdings shown on the
Depositary's records unless the Depositary has reason to believe that it will
not receive payments on such payment date. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary
practices and will be the responsibility of such Participant and not of the
Depositary, the relevant Trustee, CFB Capital or the Company, subject to any
statutory or regulatory requirements as may be in effect from time to time.
Payment of Distributions to the Depositary is the responsibility of the relevant
Trustee, disbursement of such payments to Direct Participants is the
responsibility of the Depositary, and disbursements of such payments to the
Beneficial Owners is the responsibility of Direct and Indirect Participants.

The Depositary may discontinue providing its services as securities
depositary with respect to any of the Capital Securities or the Junior
Subordinated Debentures at any time by giving reasonable notice to the relevant
Trustee and the Company. In the event that a successor securities depositary is
not obtained, definitive Capital Securities or Subordinated Debenture
certificates representing such Capital Securities or Junior Subordinated
Debentures are required to be printed and delivered. The Company, at its option,
may decide to discontinue use of the system of book-entry transfers through the
Depositary (or a successor depositary). After a Debenture Event of Default, the
holders of a majority in liquidation preference of Capital Securities or
aggregate principal amount of Junior Subordinated Debentures may determine to
discontinue the system of book-entry transfers through the Depositary. In any
such event, definitive certificates for such Capital Securities or Junior
Subordinated Debentures will be printed and delivered.

The information in this section concerning the Depositary and the
Depositary's book-entry system has been obtained from sources that CFB Capital
and the Company believe to be accurate, but CFB Capital and

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the Company assume no responsibility for the accuracy thereof. Neither CFB
Capital nor the Company has any responsibility for the performance by the
Depositary or its Participants of their respective obligations as described
herein or under the rules and procedures governing their respective operations.

DESCRIPTION OF GUARANTEE

The Capital Securities Guarantee Agreement (the "Guarantee") will be
executed and delivered by the Company concurrently with the issuance of the
Capital Securities for the benefit of the holders of the Capital Securities.
Wilmington Trust Company will act as indenture trustee ("Guarantee Trustee")
under the Guarantee for the purposes of compliance with the Trust Indenture Act,
and the Guarantee will be qualified as an Indenture under the Trust Indenture
Act. The following summary of certain provisions of the Guarantee does not
purport to be complete and is subject to, and qualified in its entirety by
reference to, all of the provisions of the Guarantee Agreement, including the
definitions therein of certain terms, and the Trust Indenture Act. The form of
the Guarantee has been filed as an exhibit to the Registration Statement of
which this Prospectus forms a part. The Guarantee Trustee will hold the
Guarantee for the benefit of the holders of the Capital Securities.

GENERAL

The Guarantee will be an irrevocable guarantee on a subordinated basis of
CFB Capital's obligations under the Capital Securities, but will apply only to
the extent that CFB Capital has funds sufficient to make such payments, and is
not a guarantee of collection.

The Company will irrevocably agree to pay in full on a subordinated basis,
to the extent set forth herein, the Guarantee Payments (as defined below) to the
holders of the Capital Securities, as and when due, regardless of any defense,
right of set-off or counterclaim that CFB Capital may have or assert other than
the defense of payment. The following payments with respect to the Capital
Securities, to the extent not paid by or on behalf of CFB Capital (the
"Guarantee Payments"), will be subject to the Guarantee: (i) any accumulated and
unpaid Distributions required to be paid on the Capital Securities, to the
extent that CFB Capital has funds on hand available therefor at such time, (ii)
the Redemption Price with respect to any Capital Securities called for
redemption to the extent that CFB Capital has funds on hand available therefor
at such time, and (iii) upon a voluntary or involuntary dissolution, winding up
or liquidation of CFB Capital (unless the Junior Subordinated Debentures are
distributed to holders of the Capital Securities), the lesser of (a) the
Liquidation Distribution and (b) the amount of assets of CFB Capital remaining
available for distribution to holders of Capital Securities. The Company's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Company to the holders of the Capital Securities or by
causing CFB Capital to pay such amounts to such holders.

If the Company does not make interest payments on the Junior Subordinated
Debentures held by CFB Capital, CFB Capital will not be able to pay
Distributions on the Capital Securities and will not have funds legally
available therefor. The Guarantee will rank subordinate and junior in right of
payment to all Senior and Subordinated Debt of the Company. See "Status of the
Guarantee" below. Because the Company is a holding company, the right of the
Company to participate in any distribution of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise, is subject to the prior
claims of creditors of that subsidiary, except to the extent the Company may
itself be recognized as a creditor of that subsidiary. Accordingly, the
Company's obligations under the Guarantee will be effectively subordinated to
all existing and future liabilities of the Company's subsidiaries, and claimants
should look only to the assets of the Company for payments thereunder. Except as
otherwise described herein, the Guarantee does not limit the incurrence or
issuance of other secured or unsecured debt of the Company, including Senior and
Subordinated Debt whether under the Indenture, any other indenture that the
Company may enter into in the future, or otherwise.

49
<PAGE>
The Company has, through the Guarantee, the Trust Agreement, the Junior
Subordinated Debentures, the Indenture and the Expense Agreement, taken
together, fully, irrevocably and unconditionally guaranteed all of CFB Capital's
obligations under the Capital Securities. No single document standing alone or
operating in conjunction with fewer than all of the other documents constitutes
such guarantee. It is only the combined operation of these documents that has
the effect of providing a full, irrevocable and unconditional guarantee of CFB
Capital's obligations under the Capital Securities. See "Relationship Among the
Capital Securities, the Junior Subordinated Debentures and the Guarantee."

STATUS OF THE GUARANTEE

The Guarantee will constitute an unsecured obligation of the Company and
will rank subordinate and junior in right of payment to all Senior and
Subordinated Debt in the same manner as the Junior Subordinated Debentures.

The Guarantee will constitute a guarantee of payment and not of collection.
For example, the guaranteed party may institute a legal proceeding directly
against the Company to enforce its rights under the Guarantee without first
instituting a legal proceeding against any other person or entity. The Guarantee
will be held for the benefit of the holders of the Capital Securities. The
Guarantee will not be discharged except by payment of the Guarantee Payments in
full to the extent not paid by CFB Capital or upon distribution to the holders
of the Capital Securities of the Junior Subordinated Debentures to the holders
of the Capital Securities. The Guarantee does not place a limitation on the
amount of additional Senior and Subordinated Debt that may be incurred by the
Company. The Company expects from time to time to incur additional indebtedness
constituting Senior and Subordinated Debt.

AMENDMENTS AND ASSIGNMENT

Except with respect to any changes which do not materially adversely affect
the rights of holders of the Capital Securities (in which case no vote will be
required), the Guarantee may not be amended without the prior approval of the
holders of not less than a majority of the aggregate Liquidation Amount of such
outstanding Capital Securities. See "Description of the Capital Securities --
Voting Rights; Amendment of Trust Agreement." All guarantees and agreements
contained in the Guarantee shall bind the successors, assigns, receivers,
trustees and representatives of the Company and shall inure to the benefit of
the holders of the Capital Securities then outstanding.

EVENTS OF DEFAULT

An event of default under the Guarantee will occur upon the failure of the
Company to perform any of its payment or other obligations thereunder. The
holders of not less than a majority in aggregate 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 the Guarantee or to direct the exercise of any trust or power
conferred upon the Guarantee Trustee under the Guarantee.

Any holder of the Capital Securities may institute a legal proceeding
directly against the Company to enforce its rights under the Guarantee without
first instituting a legal proceeding against CFB Capital, the Guarantee Trustee
or any other person or entity.

The Company, as guarantor, is required to file annually with the Guarantee
Trustee a certificate as to whether or not the Company is in compliance with all
the conditions and covenants applicable to it under the Guarantee.

INFORMATION CONCERNING THE GUARANTEE TRUSTEE

The Guarantee Trustee, other than during the occurrence and continuance of a
default by the Company in performance of the Guarantee, undertakes to perform
only such duties as are specifically set forth in the Guarantee and, after
default with respect to the Guarantee, must exercise the same degree of care and
skill as a prudent person would exercise or use in the conduct of his or her own
affairs. Subject to this provision,

50
<PAGE>
the Guarantee Trustee is under no obligation to exercise any of the powers
vested in it by the Guarantee at the request of any holder of the Capital
Securities unless it is offered reasonable indemnity against the costs, expenses
and liabilities that might be incurred thereby.

TERMINATION OF THE GUARANTEE

The Guarantee will terminate and be of no further force and effect upon full
payment of the Redemption Price of the Capital Securities, upon full payment of
the amounts payable upon liquidation of CFB Capital or upon distribution of
Junior Subordinated Debentures to the holders of the Capital Securities. The
Guarantee will continue to be effective or will be reinstated, as the case may
be, if at any time any holder of the Capital Securities must restore payment of
any sums paid under the Capital Securities or the Guarantee.

GOVERNING LAW

The Guarantee will be governed by and construed in accordance with the laws
of the State of Minnesota.

THE EXPENSE AGREEMENT

Pursuant to the Agreement as to Expenses and Liabilities entered into by the
Company under the Trust Agreement (the "Expense Agreement"), the Company will
irrevocably and unconditionally guarantee to each person or entity to whom CFB
Capital becomes indebted or liable, the full payment of any costs, expenses or
liabilities of CFB Capital, other than obligations of CFB Capital to pay to the
holders of the Capital Securities or other similar interests in CFB Capital of
the amounts due such holders pursuant to the terms of the Capital Securities or
such other similar interests, as the case may be.

RELATIONSHIP AMONG THE CAPITAL SECURITIES, THE
JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE

FULL AND UNCONDITIONAL GUARANTEE

Payments of Distributions and other amounts due on the Capital Securities
(to the extent CFB Capital has funds available for the payment of such
Distributions) are irrevocably guaranteed by the Company as and to the extent
set forth under "Description of Guarantee." Taken together, the Company's
obligations under the Junior Subordinated Debentures, the Indenture, the Trust
Agreement, the Expense Agreement and the Guarantee provide, in the aggregate, a
full, irrevocable and unconditional guarantee of payments of distributions and
other amounts due on the Capital Securities. No single document standing alone
or operating in conjunction with fewer than all of the other documents
constitutes such guarantee. It is only the combined operation of those documents
that has the effect of providing a full, irrevocable and unconditional guarantee
of CFB Capital's obligations under the Capital Securities. If and to the extent
that the Company does not make payments on the Junior Subordinated Debentures,
CFB Capital will not pay Distributions or other amounts due on the Capital
Securities. The Guarantee does not cover payment of Distributions when CFB
Capital does not have sufficient funds to pay such Distributions. In such event,
the remedy of a holder of the Capital Securities is to institute a legal
proceeding directly against the Company for enforcement of payment of such
Distributions to such holder. The obligations of the Company under the Guarantee
are subordinate and junior in right of payment to all Senior and Subordinated
Debt.

SUFFICIENCY OF PAYMENTS

As long as payments of interest and other payments are made when due on the
Junior Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments due on the Capital Securities, primarily
because: (i) the aggregate principal amount of the Junior Subordinated
Debentures will be equal to the sum of the aggregate Liquidation Amount of the
Capital Securities and Common Securities; (ii) the interest rate and interest
and other payment dates on the Junior Subordinated Debentures will match the
Distribution rate and Distribution and other payment dates for the Capital
Securities; (iii) the Company

51
<PAGE>
shall pay for all and any costs, expenses and liabilities of CFB Capital except
CFB Capital's obligations to holders of Capital Securities; and (iv) the Trust
Agreement further provides that CFB Capital will not engage in any activity that
is not consistent with the limited purposes of CFB Capital.

Notwithstanding anything to the contrary in the Indenture, the Company has
the right to set-off any payment it is otherwise required to make thereunder
with and to the extent the Company has theretofore made, or is concurrently on
the date of such payment making, a payment under the Guarantee.

ENFORCEMENT RIGHTS OF HOLDERS OF THE CAPITAL SECURITIES UNDER THE GUARANTEE

A holder of any the Capital Securities may institute a legal proceeding
directly against the Company to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee, CFB Capital
or any other person or entity,

A default or event of default under any Senior and Subordinated Debt would
not constitute a default or Event of Default. However, in the event of payment
defaults under, or acceleration of, Senior and Subordinated Debt, the
subordination provisions of the Indenture provide that no payments may be made
in respect of the Junior Subordinated Debentures until such Senior and
Subordinated Debt has been paid in full or any payment default thereunder has
been cured or waived. Failure to make required payments on Junior Subordinated
Debentures would constitute an Event of Default.

LIMITED PURPOSE OF CFB CAPITAL

The Capital Securities evidence a beneficial interest in CFB Capital, and
CFB Capital exists for the sole purpose of issuing the Trust Securities and
investing the proceeds thereof in Junior Subordinated Debentures. A principal
difference between the rights of a holder of the Capital Securities and a holder
of a Subordinated Debenture is that a holder of a Subordinated Debenture is
entitled to receive from the Company the principal amount of and interest
accrued on Junior Subordinated Debentures held, while a holder of the Capital
Securities is entitled to receive Distributions from CFB Capital (or from the
Company under the Guarantee) if and to the extent CFB Capital has funds
available for the payment of such Distributions.

RIGHTS UPON TERMINATION

Upon any voluntary or involuntary termination, winding-up or liquidation of
CFB Capital involving the liquidation of the Junior Subordinated Debentures, the
holders of Capital Securities will be entitled to receive, out of assets held by
CFB Capital, the Liquidation Distribution in cash. See "Description of the
Capital Securities -- Liquidation Distribution Upon Termination." Upon any
voluntary or involuntary liquidation or bankruptcy of the Company, the Property
Trustee, as holder of the Junior Subordinated Debentures, would be a
subordinated creditor of the Company, subordinated in right of payment to all
Senior and Subordinated Debt as set forth in the Indenture, but entitled to
receive payment in full of principal and interest, before any stockholders of
the Company receive payments or distributions. Since the Company is the
guarantor under the Guarantee and has agreed to pay for all costs, expenses and
liabilities of CFB Capital (other than CFB Capital's obligations to the holders
of its Capital Securities), the positions of a holder of the Capital Securities
and a holder of Junior Subordinated Debentures relative to other creditors and
to stockholders of the Company in the event of liquidation or bankruptcy of the
Company are expected to be substantially the same.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

In the opinion of Lindquist & Vennum P.L.L.P., counsel to the Company
("Counsel"), the following summary accurately describes the material United
States federal income tax consequences that may be relevant to the purchase,
ownership and disposition of Capital Securities. Unless otherwise stated, this
summary deals only with Capital Securities held as capital assets by United
States Persons (defined below) who purchase the Capital Securities upon original
issuance at their original offering price. As used herein, a

52
<PAGE>
"United States Person" means a person that is (i) a citizen or resident of the
United States, (ii) a corporation, partnership or other entity created or
organized in or under the laws of the United States or any political subdivision
thereof, (iii) an estate the income of which is subject to United States federal
income taxation regardless of its source, or (iv) a trust the income of which is
subject to United States federal income taxation regardless of its source;
provided, however, that for taxable years beginning after December 31, 1996 (or,
if a trustee so elects, for taxable years ending after August 20, 1996), a
"United States Person" shall include any trust if a court is able to exercise
primary supervision over the administration of such trust and one or more United
States fiduciaries have the authority to control all substantial decisions of
such trust. The tax treatment of holders may vary depending on their particular
situation. This summary does not address all the tax consequences that may be
relevant to a particular holder or to holders who may be subject to special tax
treatment, such as banks, real estate investment trusts, regulated investment
companies, insurance companies, dealers in securities or currencies, tax-exempt
investors, or foreign investors. In addition, this summary does not include any
description of any alternative minimum tax consequences or the tax laws of any
state, local or foreign government that may be applicable to a holder of Capital
Securities. This summary is based on the Internal Revenue Code of 1986, as
amended (the "Code"), the Treasury regulations promulgated thereunder and
administrative and judicial interpretations thereof, as of the date hereof, all
of which are subject to change, possibly on a retroactive basis.

The following discussion does not discuss the tax consequences that might be
relevant to persons that are not United States Persons ("non-United States
Persons") . Non-United States Persons should consult their own tax advisors as
to the specific United States federal income tax consequences of the purchase,
ownership and disposition of Capital Securities.

The authorities on which this summary is based are subject to various
interpretations and the opinions of Counsel are not binding on the Internal
Revenue Service ("Service") or the courts, either of which could take a contrary
position. Moreover, no rulings have been or will be sought from the Service with
respect to the transactions described herein. Accordingly, there can be no
assurance that the Service will not challenge the opinions expressed herein or
that a court would not sustain such a challenge. Nevertheless, Counsel has
advised that it is of the view that, if challenged, the opinions expressed
herein would be sustained by a court with jurisdiction in a properly presented
case.

HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE TAX
CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE CAPITAL
SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN, AND
OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN UNITED STATES FEDERAL OR
OTHER TAX LAWS. FOR A DISCUSSION OF THE POSSIBLE REDEMPTION OF THE CAPITAL
SECURITIES UPON THE OCCURRENCE OF CERTAIN TAX EVENTS, SEE "DESCRIPTION OF
CAPITAL SECURITIES -- REDEMPTION."

CLASSIFICATION OF CFB CAPITAL

In connection with the issuance of the Capital Securities, Counsel is of the
opinion that, under current law and assuming compliance with the terms of the
Trust Agreement, and based on certain facts and assumptions contained in such
opinion, CFB Capital will be classified as a grantor trust and not as an
association taxable as a corporation for United States federal income tax
purposes. As a result, each beneficial owner of the Capital Securities (a
"Securityholder") will be treated as owning an undivided beneficial interest in
the Junior Subordinated Debentures. Accordingly, each Securityholder will be
required to include in its gross income its pro rata share of the interest
income or original issue discount that is paid or accrued on the Junior
Subordinated Debentures. See "-- Interest Income and Original Issue Discount."
No amount included in income with respect to the Capital Securities will be
eligible for the dividends received deduction.

53
<PAGE>
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES

The Company intends to take the position that the Junior Subordinated
Debentures will be classified for United States federal income tax purposes as
indebtedness of the Company under current law, and, by acceptance of a Capital
Security, each holder covenants to treat the Junior Subordinated Debentures as
indebtedness and the Capital Securities as evidence of an indirect beneficial
ownership interest in the Junior Subordinated Debentures. No assurance can be
given, however, that such position of the Company will not be challenged by the
Internal Revenue Service or, if challenged, that such a challenge will not be
successful. The remainder of this discussion assumes that the Junior
Subordinated Debentures will be classified for United States federal income tax
purposes as indebtedness of the Company.

INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT

Except as set forth below, stated interest on the Junior Subordinated
Debentures generally will be included in income by a Securityholder at the time
such interest income is paid or accrued in accordance with such Securityholder's
regular method of tax accounting.

The Company believes that, under the applicable Treasury regulations, the
Junior Subordinated Debentures will not be considered to have been issued with
"original issue discount" ("OID") within the meaning of Section 1273(a) of the
Code. If, however, the Company exercises its right to defer Payments of interest
on the Junior Subordinated Debentures, the Junior Subordinated Debentures will
become OID instruments at such time and all Securityholders will be required to
accrue the stated interest on the Junior Subordinated Debentures on a daily
basis during the Extension Period, even though the Company will not pay such
interest until the end of the Extension Period, and even though some
Securityholders may use the cash method of tax accounting. Moreover, thereafter
the Junior subordinated Debentures will be taxed as OID instruments for as long
as they remain outstanding. Thus, even after the end of the Extension Period,
all Securityholders would be required to continue to include the stated interest
on the Junior Subordinated Debentures in income on a daily economic accrual
basis, regardless of their method of tax accounting and in advance of receipt of
the cash attributable to such interest income. Under the OID economic accrual
rules, a Securityholder would accrue an amount of interest income each year that
approximates the stated interest payments called for under the Junior
Subordinated Debentures, and actual cash payments of interest on the Junior
Subordinated Debentures would not be reported separately as taxable income.

The Treasury regulations described above have not yet been addressed in any
rulings or other interpretations by the Service, and it is possible that the
Service could take a contrary position. If the Service were to assert
successfully that the stated interest on the Junior Subordinated Debentures was
OID regardless of whether the Corporation exercises its right to defer payments
of interest on such debentures, all Securityholders would be required to include
such stated interest in income on a daily economic accrual basis as described
above.

DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES TO HOLDERS OF CAPITAL SECURITIES

Under current law, a distribution by CFB Capital of the Junior Subordinated
Debentures as described under the caption "Description of Capital Securities --
Liquidation and Distribution Upon Termination" will be non-taxable and will
result in the Securityholder receiving directly its pro rata share of the Junior
Subordinated Debentures previously held indirectly through CFB Capital, with a
holding period and aggregate tax basis equal to the holding period and aggregate
tax basis such Securityholder had in its Capital Securities before such
distribution. If, however, the liquidation of CFB Capital were to occur because
CFB Capital is subject to United States federal income tax with respect to
income accrued or received on the Junior Subordinated Debentures as a result of
a Tax Event or otherwise, the distribution of Junior Subordinated Debentures to
Securityholders by CFB Capital could be a taxable event to CFB Capital and each
Securityholder, and a Securityholder would recognize gain or loss as if the
Securityholder had exchanged its Capital Securities for the Junior Subordinated
Debentures it received upon the liquidation of CFB Capital. A Securityholder
would recognize interest income in respect of Junior Subordinated Debentures
received from CFB Capital in the manner described above under "-- Interest
Income and Original Issue Discount."

54
<PAGE>
SALES OR REDEMPTION OF CAPITAL SECURITIES

Gain or loss will be recognized by a Securityholder on a sale of Capital
Securities (including a redemption for cash) in an amount equal to the
difference between the amount realized (which for this purpose, will exclude
amounts attributable to accrued interest or OID not previously included in
income) and the Securityholder's adjusted tax basis in the Capital Securities
sold or so redeemed. Gain or loss recognized by a Securityholder on Capital
Securities held for more than one year will generally be taxable as long-term
capital gain or loss. Amounts attributable to accrued interest with respect to a
Securityholder's pro rata share of the Junior Subordinated Debentures not
previously included in income will be taxable as ordinary income.

BACKUP WITHHOLDING TAX AND INFORMATION REPORTING

The amount of OID accrued on the Capital Securities held of record by United
States Persons (other than corporations and other exempt Securityholders), if
any, will be reported to the Service. "Backup" withholding at a rate of 31% will
apply to payments of interest to non-exempt United States Persons unless the
Securityholder furnishes its taxpayer identification number in the manner
prescribed in applicable Treasury Regulations, certifies that such number is
correct, certifies as to no loss of exemption from backup withholding and meets
certain other conditions. Any amounts withheld from a Securityholder under the
backup withholding rules will be allowed as a refund or a credit against such
Securityholder's United States federal income tax liability, provided the
required information is furnished to the Service.

POSSIBLE TAX LAW CHANGES

On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill"), the
revenue portion of President Clinton's budget proposal, was released. The Bill
would, among other things, deny interest deductions for interest on an
instrument issued by a corporation that has a maximum term of more than 20 years
and that is not shown as indebtedness on the separate balance sheet of the
issuer or, where the instrument is issued to a related party (other than a
corporation), where the holder or some other related party issues a related
instrument that is not shown as indebtedness on the issuer's consolidated
balance sheet. It is possible that this provision could be adopted with
retroactive effect, in which event the Company might be unable to deduct
interest on the Junior Subordinated Debentures. However, on March 29, 1996, the
Chairmen of the Senate Finance and House Ways and Means Committees issued a
joint statement to the effect that it was their intention that the effective
date of the President's legislative proposals, if adopted, will be no earlier
than the date of appropriate Congressional action. However, there can be no
assurance that current or future legislative proposals or final legislation will
not affect the ability of the Company to deduct interest on the Junior
Subordinated Debentures. Such a change could give rise to a Tax Event, which may
permit the Company, upon approval of the Federal Reserve if then required under
applicable capital guidelines or policies of the Federal Reserve, to cause a
redemption of the Capital Securities. See "Description of the Capital Securities
- -- Redemption" and "Description of Junior Subordinated Debentures --
Redemption."

55
<PAGE>
UNDERWRITING

The Underwriters named below have agreed, subject to the terms and
conditions of a Purchase Agreement to purchase from CFB Capital the respective
principal amount of the Capital Securities set forth opposite their names in the
table below.

<TABLE>
<CAPTION>
UNDERWRITER AMOUNT
- -------------------------------------------------------------------------------- ------------
<S> <C>
Piper Jaffray Inc............................................................... $
Dain Bosworth Incorporated......................................................
------------
$
------------
------------
</TABLE>

The Underwriters have advised the Company and CFB Capital that they propose
to offer the Capital Securities directly to the public initially at the public
offering price set forth on the cover page of this Prospectus and to selected
dealers at such price less a concession not in excess of $ per Capital
Security. The Underwriters may allow and such dealers may reallow a concession
not in excess of $ per Capital Security to certain other brokers and
dealers. After the public offering, the public offering price, concession and
reallowance, and other selling terms may be changed by the Underwriters.

In view of the fact that the proceeds from the sale of the Capital
Securities will be used to purchase the Junior Subordinated Debentures issued by
the Company, the Purchase Agreement provides that the Company will pay as
compensation for the Underwriters' arranging the investment therein of such
proceeds an amount of $ per Capital Security.

Each of the Company and CFB Capital has agreed to indemnify the Underwriters
and their controlling persons against certain liabilities, including liabilities
under the Securities Act of 1933, as amended, or to contribute to payments the
Underwriters may be required to make in respect thereof.

The Underwriters have advised CFB that they do not intend to confirm sales
to any account over which either Underwriter exercises discretionary authority
in excess of 5% of the number of Capital Securities offered hereby. In
connection with the Offer and Sale of the Capital Securities, the Underwriters
will comply with Rule 2810 under the NASD Conduct Rules.

Piper Jaffray Inc. and Dain Bosworth Incorporated have periodically provided
investment banking services to the Company.

LEGAL MATTERS

Certain matters of Delaware law relating to the validity of the Capital
Securities, the enforceability of the Trust Agreement and the formation of CFB
Capital will be passed upon by Richards, Layton & Finger, P.A., Wilmington,
Delaware, special Delaware counsel to the Company and CFB Capital. The validity
of the Guarantee and the Junior Subordinated Debentures will be passed upon for
the Company by Lindquist & Vennum P.L.L.P., Minneapolis, Minnesota, counsel to
the Company. Patrick Delaney, a holder of common stock and of options to
purchase common stock and a director of the Company, is a partner in Lindquist &
Vennum. Certain legal matters in connection with this Offering will be passed
upon for the Underwriters by Faegre & Benson LLP, Minneapolis, Minnesota.
Lindquist & Vennum and Faegre & Benson LLP will rely on the opinions of
Richards, Layton & Finger as to matters of Delaware law. Certain matters
relating to United States federal income tax considerations will be passed upon
for the Company by Lindquist & Vennum.

EXPERTS

The consolidated financial statements of the Company at December 31, 1995
and 1994 and for each of the three years in the period ended December 31, 1995
incorporated by reference in this Prospectus and Registration Statement have
been audited by Ernst & Young LLP, independent auditors, as set forth in their

56
<PAGE>
report thereon incorporated by reference in this Prospectus and Registration
Statement, which report (i) is based in part on the reports of Arthur Andersen
LLP, formerly independent auditors for Mountain Parks, on the consolidated
financial statements of Mountain Parks and Subsidiaries at December 31, 1995 and
1994 and for each of the three years in the period ended December 31, 1995, and
(ii) as to the years 1994 and 1993, is based in part on the reports of Hacker,
Nelson & Co., P.C. and Fortner, Bayens, Levkulich and Co., P.C., formerly
independent auditors for Minowa Bancshares, Inc. and First Community Bankshares,
Inc., respectively. As of the date of their reports and during the periods
covered by the financial statements on which they reported, each of the
foregoing accounting firms were independent certified public accountants with
respect to the Company, Mountain Parks, Minowa Bancshares, Inc. and First
Community Bankshares, Inc., as the case may be, within the meaning of the
Securities Act and the applicable published rules and regulations thereunder.
The Company has agreed to indemnify Hacker, Nelson & Co., P.C., its officers,
directors and employees from any and all damages, fines, legal costs and
expenses that may be incurred by the parties being indemnified in successfully
defending their audit to any person, corporation or governmental entity relying
upon the audit, provided that such indemnification will not apply to any claim,
legal expense, or costs incurred if Hacker, Nelson & Co., P.C. has been found
guilty of professional malpractice with respect to such audit. The consolidated
financial statements referred to above are incorporated herein by reference in
reliance upon such reports given upon the authority of such firms as experts in
accounting and auditing.

57
<PAGE>
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS, AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY OR EITHER UNDERWRITER. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE
AN IMPLICATION THAT THE INFORMATION HEREIN OR INCORPORATED BY REFERENCE HEREIN
IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER
OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.

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

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----

<S> <C>
Available Information..................................................... 4
Incorporation of Certain Documents by Reference........................... 4
Prospectus Summary........................................................ 5
Summary Historical Consolidated Financial Data............................ 10
Risk Factors.............................................................. 13
Recent Developments....................................................... 19
Use of Proceeds........................................................... 21
Accounting Treatment...................................................... 21
Capitalization............................................................ 22
Management................................................................ 23
Description of the Capital Securities..................................... 26
Description of Junior Subordinated Debentures............................. 38
Book-Entry Issuance....................................................... 47
Description of Guarantee.................................................. 49
Relationship among the Capital Securities, the Junior Subordinated
Debentures and the Guarantee............................................ 51
Certain Federal Income Tax Consequences................................... 52
Underwriting.............................................................. 56
Legal Matters............................................................. 56
Experts................................................................... 56
</TABLE>

2,400,000 CAPITAL SECURITIES
CFB CAPITAL I
% Cumulative Capital Securities
(Liquidation Amount $25 per Capital Security)
Fully and Unconditionally Guaranteed,
as Described Herein, by

[LOGO]

-----------------
P R O S P E C T U S
------------------

PIPER JAFFRAY INC.

DAIN BOSWORTH
INCORPORATED

, 1997
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

<TABLE>
<S> <C>
Securities and Exchange Commission registration fee............... $ 18,182
NASD fee.......................................................... 6,500
Nasdaq fees....................................................... 12,000
Trustees' fees and expenses....................................... 12,000
Legal fees and expenses........................................... 100,000
Blue Sky fees and expenses........................................ 10,000
Accounting fees and expenses...................................... 30,000
Printing expenses................................................. 20,000
Miscellaneous expenses............................................ 6,318
---------
Total......................................................... $ 215,000
---------
---------
</TABLE>

All of the above items except the registration fee are estimated.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Company's Bylaws require indemnification of directors and officers of
the Company to the fullest extent permitted by Delaware law. Section 145 of the
Delaware General Corporation Law generally provides that any person who was or
is a director or officer may be indemnified against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred in connection with the defense or settlement of any
threatened, pending or completed legal proceedings in which he or she is
involved by reason of the fact that he or she is or was a director or officer if
he or she acted in good faith and in a manner that he or she reasonably believed
to be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, if he or she had no reasonable
cause to believe that his or her conduct was unlawful. However, if the legal
proceeding is by or in the right of the corporation, the director or officer may
not be indemnified in respect of any claim, issue or matter as to which he or
she shall have been adjudged to be liable to the corporation unless the court in
which such action was brought deems it proper.

The Company currently has in effect policies of insurance which provide
insurance protection to its directors and officers against some liabilities
which may be incurred by them on account of their services to the Company. The
Company has also entered into indemnification agreements with each of its
directors and officers, which agreements provide for indemnification to the
fullest extent permitted by Delaware law, except that with respect to an action
commenced by an indemnitee against the Company or by the indemnitee as a
derivative action by or in the right of the Company, such indemnitees shall be
indemnified at the discretion of the Board of Directors. Subject to certain
limitations, the agreements also provide for indemnification against any and all
expenses (including attorneys' fees), judgments, fines, and amounts paid in
settlement actually and reasonably incurred by the indemnitee in connection with
any threatened, pending, or completed action, suit, or proceeding, whether
civil, criminal, administrative, or investigative (including, without
limitation, any derivative action by or in the right of the Company) to which
the indemnitee is, was, or at any time becomes a party or is threatened to be
made a party by reason of the fact that the indemnitee is or was at any time a
director, officer, employee, or agent of the Company or is or was serving or at
any time serves at the request of the Company as a director, officer, employee,
or agent of another corporation, partnership, joint venture, trust, or other
enterprise.

II-1
<PAGE>
ITEM 16. EXHIBITS

(a) Exhibits

<TABLE>
<C> <S>
1.1 Form of Purchase Agreement.
2.1 Agreement and Plan of Reorganization dated as of June 25, 1996 between the
Registrant and Mountain Parks Financial Corp. (incorporated by reference to
Exhibit 2.1 to the Registrant's Registration Statement on Form S-4 (File No.
333-14439) as declared effective by the Securities and Exchange Commission on
November 6, 1996).
2.2 Agreement and Plan of Merger dated as of March 8, 1996 between the Registrant,
Trinidad Acquisition Corporation and Financial Bancorp, Inc. (incorporated by
reference to Exhibit 2.1 to the Registrant's Registration Statement on Form S-4
(File No. 333-6239) as declared effective by the Securities and Exchange
Commission on August 9, 1996).
4.1 Form of Subordinated Indenture dated February , 1997 to be entered into between
the Registrant and Wilmington Trust Company, as Indenture Trustee.
4.2 Form of Junior Subordinated Debenture (included as an exhibit to Exhibit 4.1).
4.3 Certificate of Trust of CFB Capital I.*
4.4 Trust Agreement of CFB Capital I dated as of January 14, 1997.*
4.5 Form of Amended and Restated Trust Agreement of CFB Capital I, to be dated
February , 1997.*
4.6 Form of Capital Security Certificate of CFB Capital I (included as an exhibit to
Exhibit 4.5).
4.7 Form of Capital Securities Guarantee Agreement.*
4.8 Form of Agreement as to Expenses and Liabilities (included as an exhibit to
Exhibit 4.5).
5.1 Opinion of Lindquist & Vennum P.L.L.P.*
5.2 Opinion and Consent of Richards, Layton & Finger, P.A.*
8.1 Opinion and Consent of Lindquist & Vennum P.L.L.P., counsel to the Registrant, as
to certain federal income tax matters.
12.1 Statement re Computation of Ratios.*
23.1 Consent of Ernst & Young LLP.*
23.2 Consent of Hacker, Nelson & Co., P.C.*
23.3 Consent of Fortner, Bayens, Levkulich and Co., P.C.*
23.4 Consent of Arthur Andersen LLP.*
23.6 Consent of Lindquist & Vennum P.L.L.P. (included in Exhibit 5.1 above).
23.7 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.2 above)
24.1 A power of attorney is set forth on the signature page of the Registration
Statement.
25.1 Form T-1 Statement of Eligibility of Wilmington Trust Company to act as trustee
under the Subordinated Indenture.*
25.2 Form T-1 Statement of Eligibility of Wilmington Trust Company to act as trustee
under the Amended and Restated Trust Agreement.*
25.3 Form T-1 Statement of Eligibility of Wilmington Trust Company to act as trustee
under the Capital Securities Guarantee Agreement.*
99.1 Report of Arthur Andersen LLP regarding financial statements of Mountain Parks
Financial Corp.*
</TABLE>

- ------------------------
* Previously filed.

II-2
<PAGE>
ITEM 17. UNDERTAKINGS

(b) The 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.

(h) 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 whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

(i) The Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of a registration statement in reliance upon Rule 430A and contained in the
form of prospectus filed by Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of the
registration statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus 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.

II-3
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the 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 Fargo and the State of North Dakota, on this 28th day
of January, 1997.

COMMUNITY FIRST BANKSHARES, INC.

By /s/ DONALD R. MENGEDOTH
------------------------------------------
Donald R. Mengedoth
PRESIDENT, CHIEF EXECUTIVE OFFICER
AND CHAIRMAN OF THE BOARD OF DIRECTORS

CFB CAPITAL I

By /s/ DONALD R. MENGEDOTH
------------------------------------------
Donald R. Mengedoth,
TRUSTEE

By /s/ MARK A. ANDERSON
------------------------------------------
Mark A. Anderson,
TRUSTEE

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below on the 28th day of January, 1997,
by the following persons in the capacities indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE
- ---------------------------------------- ------------------------------------
<C> <S>
President, Chief Executive Officer,
/s/ DONALD R. MENGEDOTH Chairman of the Board of Directors
- ---------------------------------------- and Director (principal executive
Donald R. Mengedoth officer)

Executive Vice President, Chief
/s/ MARK A. ANDERSON Financial Officer, Secretary and
- ---------------------------------------- Treasurer (principal financial and
Mark A. Anderson accounting officer)

*
- ---------------------------------------- Director
Patricia A. Adam

*
- ---------------------------------------- Director
James T. Anderson
</TABLE>

II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ---------------------------------------- ------------------------------------
<C> <S>
*
- ---------------------------------------- Director
Patrick E. Benedict

*
- ---------------------------------------- Director
Patrick Delaney

*
- ---------------------------------------- Director
John H. Flittie

*
- ---------------------------------------- Director
Cargill MacMillan, Jr.

*
- ---------------------------------------- Director
Dennis M. Mathisen

*
- ---------------------------------------- Director
Dean E. Smith

*
- ---------------------------------------- Director
Thomas C. Wold

*
- ---------------------------------------- Director
Harvey L. Wollman
</TABLE>

*By: /s/ MARK A. ANDERSON
-----------------------------------------
Mark A. Anderson
ATTORNEY-IN-FACT

II-5
<PAGE>
EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- -------------------------------------------------------------------------------------------------
<C> <S> <C>
1.1 Form of Purchase Agreement
2.1 Agreement and Plan of Reorganization dated as of June 25, 1996 between the Registrant and
Mountain Parks Financial Corp. (incorporated by reference to Exhibit 2.1 to the Registrant's
Registration Statement on Form S-4 (File No. 333-14439) as declared effective by the Securities
and Exchange Commission on November 6, 1996)
2.2 Agreement and Plan of Merger dated as of March 8, 1996 between the Registrant, Trinidad
Acquisition Corporation and Financial Bancorp, Inc. (incorporated by reference to Exhibit 2.1 to
the Registrant's Registration Statement on Form S-4 (File No. 333-6239) as declared effective by
the Securities and Exchange Commission on August 9, 1996)
4.1 Form of Subordinated Indenture dated February , 1997 to be entered into between the Registrant
and Wilmington Trust Company, as Indenture Trustee
4.2 Form of Junior Subordinated Debenture (included as an exhibit to Exhibit 4.1)
4.3 Certificate of Trust of CFB Capital I*
4.4 Trust Agreement of CFB Capital I dated as of January 14, 1997*
4.5 Form of Amended and Restated Trust Agreement of CFB Capital I, to be dated February , 1997*
4.6 Form of Capital Security Certificate of CFB Capital I (included as an exhibit to Exhibit 4.5)
4.7 Form of Capital Securities Guarantee Agreement*
4.8 Form of Agreement as to Expenses and Liabilities (included as an exhibit to Exhibit 4.5)
5.1 Opinion of Lindquist & Vennum P.L.L.P.*
5.2 Opinion and Consent of Richards, Layton & Finger, P.A.*
8.1 Opinion and Consent of Lindquist & Vennum P.L.L.P., counsel to the Registrant, as to certain
federal income tax matters
12.1 Statement re Computation of Ratios*
23.1 Consent of Ernst & Young LLP*
23.2 Consent of Hacker, Nelson & Co., P.C.*
23.3 Consent of Fortner, Bayens, Levkulich and Co., P.C.*
23.4 Consent of Arthur Andersen LLP*
23.6 Consent of Lindquist & Vennum P.L.L.P. (included in Exhibit 5.1 above)
23.7 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.2 above)
24.1 A power of attorney is set forth on the signature page of the Registration Statement
25.1 Form T-1 Statement of Eligibility of Wilmington Trust Company to act as trustee under the
Subordinated Indenture*
25.2 Form T-1 Statement of Eligibility of Wilmington Trust Company to act as trustee under the Amended
and Restated Trust Agreement*
25.3 Form T-1 Statement of Eligibility of Wilmington Trust Company to act as trustee under the Capital
Securities Guarantee Agreement*
99.1 Report of Arthur Andersen LLP regarding financial statements of Mountain Parks Financial Corp.*
</TABLE>

- ------------------------
* Previously filed.

<PAGE>

CAPITAL SECURITIES

CFB CAPITAL I

_____% CUMULATIVE CAPITAL SECURITIES
(LIQUIDATION PREFERENCE OF $25 PER CAPITAL SECURITY)

PURCHASE AGREEMENT

February ___, 1997

PIPER JAFFRAY INC.
DAIN BOSWORTH INCORPORATED
c/o Piper Jaffray Inc.
Piper Jaffray Tower
222 South Ninth Street
Minneapolis, Minnesota 55402

Ladies and Gentlemen:

Community First Bankshares, Inc., a Delaware corporation (the "Company"),
and its fiduciary subsidiary, CFB Capital I, a statutory business trust
organized under the Delaware Business Trust Act (the "Delaware Act") (the
"Trust" and together with the Company, the "Offerors"), propose that the Trust
issue and sell to Piper Jaffray Inc. and Dain Bosworth Incorporated (the
"Underwriters") an aggregate of 2,400,000 of the Trust's _______% Cumulative
Capital Securities, with a liquidation preference of $25.00 per capital security
(the "Capital Securities"), the terms of which are more fully described in the
Prospectus (as hereinafter defined). The Offerors propose that the Trust issue
the Capital Securities pursuant to an Amended and Restated Trust Agreement among
Wilmington Trust Company, as Property Trustee and Indenture Trustee, the
administrative trustees named therein (the "Administrative Trustees") and the
Company (the "Trust Agreement"). The Capital Securities will be guaranteed by
the Company with respect to distributions and payments upon liquidation,
redemption and otherwise (the "Guarantee") pursuant to a Guarantee Agreement
(the "Guarantee Agreement"), dated as of February ___, 1997, between the Company
and Wilmington Trust Company, as trustee (the "Guarantee Trustee"), and entitled
to the benefits of certain backup undertakings described in the Prospectus (as
defined herein) with respect to the Company's agreement pursuant to the Expense
Agreement (as defined herein) to pay all expenses relating to administration of
the Trust.

The proceeds of the sale of the Capital Securities will be used to purchase
junior subordinated deferrable interest debentures (the "Junior Subordinated
Debentures") issued by the Company pursuant to an Indenture, dated as of
February ___, 1997, between the Company and Wilmington Trust Company as trustee
(the "Indenture").

The Offerors hereby confirm their agreement with respect to the sale of the
Capital Securities to the Underwriters.

1. REGISTRATION STATEMENT AND PROSPECTUS. A registration statement on
Form S-3 (File No. 333-19921) with respect to the Capital Securities, the
Guarantee and the Junior Subordinated Debentures, including a preliminary form
of prospectus, has been prepared by the Offerors in conformity

<PAGE>

with the requirements of the Securities Act of 1933, as amended (the "Act"), and
the rules and regulations ("Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act") and the rules and regulations
thereunder and has been filed with the Commission; and, if the Offerors have
elected to rely upon Rule 462(b) of the Rules and Regulations to increase the
size of the offering registered under the Act, the Offerors will prepare and
file with the Commission a registration statement with respect to such increase
pursuant to Rule 462(b). Copies of such registration statement(s) and
amendments and each related preliminary prospectus have been delivered to the
Underwriters.

If the Offerors have elected not to rely upon Rule 430A of the Rules and
Regulations, the Offerors have prepared and will promptly file an amendment to
the registration statement and an amended prospectus (including a term sheet
meeting the requirements of Rule 434 of the Rules and Regulations) if necessary
to complete the Prospectus. If the Offerors have elected to rely upon Rule 430A
of the Rules and Regulations, they will prepare and file a prospectus (or a term
sheet meeting the requirements of Rule 434) pursuant to Rule 424(b) that
discloses the information previously omitted from the prospectus in reliance
upon Rule 430A. Such registration statement, as amended at the time it is or
was declared effective by the Commission, and, in the event of any amendment
thereto after the effective date and prior to the Closing Date (as hereinafter
defined), such registration statement as so amended (but only from and after the
effectiveness of such amendment), including a registration statement (if any)
filed pursuant to Rule 462(b) of the Rules and Regulations increasing the size
of the offering registered under the Act and information (if any) deemed to be
part of the registration statement at the time of effectiveness pursuant to
Rules 430A(b) and 434(d) of the Rules and Regulations, is hereinafter called the
"Registration Statement". The prospectus included in the Registration Statement
at the time it is or was declared effective by the Commission is hereinafter
called the "Prospectus", except that if any prospectus (including any term sheet
meeting the requirements of Rule 434 of the Rules and Regulations provided by
the Offerors for use with a prospectus subject to completion within the meaning
of Rule 434 in order to meet the requirements of Section 10(a) of the Rules and
Regulations) filed by the Offerors with the Commission pursuant to Rule 424(b)
(and Rule 434, if applicable) of the Rules and Regulations or any other such
prospectus provided to you by the Offeror for use in connection with the
offering of the Capital Securities (whether or not required to be filed by the
Offeror with the Commission pursuant to Rule 424(b) of the Rules and
Regulations) differs from the prospectus on file at the time the Registration
Statement is or was declared effective by the Commission, the term "Prospectus"
shall refer to such differing prospectus (including any term sheet within the
meaning of Rule 434 of the Rules and Regulations) from and after the time such
prospectus is filed with the Commission or transmitted to the Commission for
filing pursuant to such Rule 424(b) (and Rule 434, if applicable) or from and
after the time it is first provided to you by the Offeror for such use. The
term "Preliminary Prospectus" as used herein means the preliminary prospectus
included in any Registration Statement prior to the time it becomes or became
effective under the Act and any prospectus subject to completion as described in
Rule 430A or 434 of the Rules and Regulations.

2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

(a) The Offerors represent and warrant to, and agree with, the
Underwriters as follows:

(i) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission and the Preliminary
Prospectus, at the time of filing thereof, did not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; except
that the foregoing shall not apply to statements in or

-2-

<PAGE>

omissions from the Preliminary Prospectus in reliance upon, and in
conformity with, written information furnished to the Company by either
Underwriter for use in the preparation thereof.

(ii) As of the time the Registration Statement (or any
post-effective amendment thereto, including a registration statement (if
any) filed pursuant to Rule 462(b) of the Rules and Regulations increasing
the size of the offering registered under the Act) is or was declared
effective by the Commission, upon the filing or first delivery to the
Underwriters of the Prospectus (or any supplement to the Prospectus
(including any term sheet meeting the requirements of Rule 434 of the Rules
and Regulations)) and at the Closing Date (as hereinafter defined), (A) the
Registration Statement and Prospectus (in each case, as so amended and/or
supplemented) conformed or will conform in all material respects to the
requirements of the Act and the Rules and Regulations and the Registration
Statement and Prospectus (in each case as so amended and/or supplemented)
conformed or will conform in all material respects to the requirements of
the Trust Indenture Act and the rules and regulations thereunder, (B) the
Registration Statement (as so amended) did not or will not include an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, and (C) the Prospectus (as so supplemented) did not or will
not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they are or were
made, not misleading; except that the foregoing shall not apply to (i)
statements in or omissions from any such document in reliance upon, and in
conformity with, written information furnished to the Offerors by either
Underwriter specifically for use in the preparation thereof and (ii) that
part of the Registration Statement which constitutes the Statement of
Eligibility and Qualification ("Form T-1") under the Trust Indenture Act.
If the Registration Statement has been declared effective by the
Commission, no stop order suspending the effectiveness of the Registration
Statement has been issued, and no proceeding for that purpose has been
initiated or, to the Offeror's knowledge, threatened by the Commission.

(iii) The documents of the Company incorporated by reference in
the Registration Statement and the Prospectus, when they were filed with
the Commission conformed in all material respects to the requirements of
the Exchange Act and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the
Registration Statement and the Prospectus or any further amendment or
supplement thereto, when such documents are filed with the Commission will
conform in all material respects to the requirements of the Exchange Act
and the rules and regulations of the Commission thereunder, and will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading.

(iv) The consolidated financial statements of the Company,
together with the notes thereto, incorporated by reference in the
Registration Statement, Preliminary Prospectus and Prospectus comply in all
material respects with the requirements of the Act and the Exchange Act and
fairly present the consolidated financial condition of the Company and its
consolidated subsidiaries as of the dates indicated and the results of
operations and changes in cash flows for the periods therein specified in
conformity with generally accepted accounting principles consistently
applied throughout the periods involved (except as otherwise stated in the
Registration Statement and Prospectus) and the independent public
accountants whose reports are contained therein are

-3-

<PAGE>

independent public accountants as required by the Act and the Rules and
Regulations. The summary financial information included in the Preliminary
Prospectus and Prospectus under the caption "Summary Consolidated Financial
Data," present fairly the information required to be stated therein.

(v) The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Delaware
and is duly registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended (the "BHC Act"), supervised by the Board of
Governors of the Federal Reserve System (the "FRB"). The only subsidiaries
of the Company and the percentage of issued and outstanding shares of stock
of each such subsidiary owned of record and beneficially by the Company are
set forth in Exhibit A attached hereto, other than the Trust. Each such
subsidiary has been duly organized and is validly existing and in good
standing under the laws of its jurisdiction of incorporation or
organization as the case may be. Each of the Company and its subsidiaries
has full corporate power and authority to own its properties and conduct
its business as currently being carried on and as described in the
Registration Statement and Prospectus, and is duly qualified to do business
as a foreign corporation in good standing under the corporation and
financial services laws of each jurisdiction in which the conduct of its
business or ownership or lease of its properties requires such
qualification and where the failure to be so qualified would, individually
or in the aggregate, have a material adverse effect on the condition
(financial or otherwise), earnings, business, prospects, assets, results of
operations or properties of the Company and its subsidiaries taken as a
whole. Other than the foregoing subsidiaries and the Trust, the Company
owns no capital stock or other equity, ownership or proprietary interest in
any company, partnership, association, trust or other entity. The accounts
of each of the Company's subsidiaries which are banks are insured by the
Bank Insurance Fund of the Federal Deposit Insurance Corporation (the
"FDIC") up to the maximum applicable amount in accordance with the rules
and regulations of the FDIC, and no proceedings for the termination or
revocation of such membership or insurance are pending, or, to the
knowledge of the Company, threatened.

(vi) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act with full trust
power and authority to own property and to conduct its business as
described in the Registration Statement and Prospectus and to enter into
and perform its obligations under this Agreement, the Capital Securities,
the Common Securities and the Trust Agreement and is authorized to do
business in each jurisdiction in which such qualification is required,
except where the failure to so qualify would not have a material adverse
effect on the Company's condition (financial or otherwise), earnings,
business, prospects, assets, results of operations or properties taken as a
whole; the Trust has conducted and will conduct no business other than the
transactions contemplated by the Trust Agreement and described in the
Prospectus; the Trust is not a party to or otherwise bound by any agreement
other than those described in the Prospectus; the Trust is and will be
classified for United States federal income tax purposes as a grantor trust
and not as an association taxable as a corporation; and the Trust is and
will be treated as a consolidated subsidiary of the Company pursuant to
generally accepted accounting principles.

(vii) Except as contemplated in the Prospectus, subsequent to the
respective dates as of which information is given in the Registration
Statement and the Prospectus, neither the Trust nor the Company, nor any of
its Subsidiaries has incurred any material liabilities or obligations,
direct or contingent, or entered into any material transactions, or
declared or paid any

-4-

<PAGE>

dividends or made any distribution of any kind with respect to its capital
stock (other than dividends paid in the ordinary course with respect to
shares of the Company's Common Stock or any of its subsidiaries' common
stock); and there has not been any change in the capital stock (other than
a change in the number of outstanding shares of Common Stock due to the
issuance of shares upon the exercise of outstanding options or warrants),
or any material change in the short-term or long-term debt, or any issuance
of options, warrants, convertible Capital Securities or other rights to
purchase the capital stock, of the Trust, the Company or any of its
Subsidiaries, or any material adverse change, or any development involving
a prospective material adverse change, in the general affairs, condition
(financial or otherwise), business, key personnel, property, prospects, net
worth or results of operations of the Trust or the Company and its
Subsidiaries, taken as a whole.

(viii) Except as set forth in the Registration Statement and the
Prospectus or in the documents incorporated therein by reference, there is
not pending or, to the knowledge of the Trust or the Company, threatened or
contemplated, any action, suit or proceeding to which the Trust or the
Company or any of its subsidiaries is a party or to which either of their
assets may be subject, before or by any court or governmental agency,
authority or body, or any arbitrator, which might result in any material
adverse change in the condition (financial or otherwise), business,
prospects, net worth or results of operations of the Trust or the Company
and its subsidiaries, taken as a whole.

(ix) There are no contracts or documents of the Trust or the
Company or any of its Subsidiaries that are required to be filed as
exhibits to the Registration Statement by the Act or by the Rules and
Regulations which contracts or documents have not been so filed.

(x) Each of this Agreement, the Indenture, the Trust Agreement,
the Guarantee and the Agreement as to Expenses and Liabilities (the
"Expense Agreement") has been duly authorized, executed and delivered by
the Company and/or the Trust, as the case may be, and constitutes a valid,
legal and binding obligation of the Company and/or the Trust, as the case
may be, enforceable in accordance with its terms, except as rights to
indemnity hereunder may be limited by federal or state securities laws and
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the rights of creditors generally
and subject to general principles of equity. The execution, delivery and
performance of this Agreement, the Indenture, the Trust Agreement, the
Guarantee Agreement and the Expense Agreement and the consummation of the
transactions herein or therein contemplated will not result in a breach or
violation of any of the terms and provisions of, or constitute a default
under, any statute, any agreement or instrument to which the Company or the
Trust is a party or by which it is bound or to which any of its property is
subject, the Company's charter or bylaws, the Trust's Trust Agreement or
its certificate of trust filed with the State of Delaware on January 15,
1997 (the "Certificate of Trust") or any order, rule, regulation or decree
of any court or governmental agency or body having jurisdiction over the
Company or the Trust or any of the properties of either the Company or the
Trust; no consent, approval, authorization or order of, or filing with, any
court or governmental agency or body is required for the execution,
delivery and performance of this Agreement, the Indenture, the Trust
Agreement, the Guarantee and the Expense Agreement or for the consummation
of the transactions contemplated hereby or thereby, including the issuance
or sale of the Junior Subordinated Debentures by the Company and the
Capital Securities by the Trust, except such as may be required under the
Act or state securities or blue sky laws; each of the Company and the Trust
has all requisite corporate power and authority to enter into this
Agreement, the Indenture, the Trust Agreement, the Guarantee and the
Expense Agreement, and to authorize, issue and sell the Capital Securities
as contemplated by this Agreement; and each of the Indenture, the Trust

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<PAGE>

Agreement and the Guarantee Agreement has been duly qualified under the
Trust Indenture Act and will conform in all material respects to the
statements relating thereto in the Registration Statement and the
Prospectus.

(xi) All of the issued and outstanding shares of capital stock of
the Company, including the shares of Common Stock issued, are duly
authorized and are, or will be at the Closing Date, validly issued, fully
paid and nonassessable, have been issued, in compliance with all federal
and state securities laws, were not issued in violation of or subject to
any preemptive rights or other rights to subscribe for or purchase
securities, and the holders thereof are not subject to personal liability
by reason of being such holders; and the capital stock of the Company,
including the Common Stock conforms to the description thereof in the
Registration Statement and Prospectus. Except as otherwise stated in the
Registration Statement and Prospectus, there are no preemptive rights or
other rights to subscribe for or to purchase, or any restriction upon the
voting or transfer of, any shares of Common Stock pursuant to the Company's
charter, bylaws or any agreement or other instrument to which the Company
is a party or by which the Company is bound. Neither the filing of the
Registration Statement gives rise to any rights for or relating to the
registration of any shares of Common Stock or other capital stock of the
Company. All of the issued and outstanding shares of capital stock of each
of the Company's subsidiaries have been duly and validly authorized and
issued and are fully paid and nonassessable, and, except as otherwise
described in the Registration Statement and Prospectus and except for any
directors' qualifying shares, the Company owns, or on the Closing Date
shall own, of record and beneficially, free and clear of any security
interests, claims, liens, proxies, equities or other encumbrances, all of
the issued and outstanding shares of such stock. Except as described in
the Registration Statement and the Prospectus, there are no options,
warrants, agreements, contracts or other rights in existence to purchase or
acquire from the Company or any Subsidiary of the Company any shares of the
capital stock of the Company or any Subsidiary of the Company. The Company
has an authorized and outstanding capitalization as set forth in the
Registration Statement and the Prospectus.

(xii) The Junior Subordinated Debentures have been duly authorized
by the Company and at the Closing Date, will have been duly executed by the
Company and, when authenticated in the manner provided for in the Indenture
and delivered against payment therefor as described in the Prospectus, will
constitute valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms except to the extent
that enforcement thereof may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the rights of creditors generally
and subject to general principles of equity, will be in the form
contemplated by, and entitled to the benefits of, the Indenture and will
conform in all material respects to the statements relating thereto in the
Prospectus

(xiii) The Common Securities have been duly authorized by the Trust
Agreement and, when issued and delivered by the Trust to the Company
against payment therefor as described in the Registration Statement and
Prospectus, will be validly issued and (subject to the terms of the Trust
Agreement) fully paid and nonassessable undivided beneficial interests in
the assets of the Trust and will conform to all statements relating thereto
contained in the Prospectus; the issuance of the Common Securities is not
subject to preemptive or other similar rights; and at the Closing Date all
of the issued and outstanding Common Securities of the Trust will be
directly owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.

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<PAGE>

(xiv) The Capital Securities have been duly authorized by the
Trust Agreement and, when issued and delivered pursuant to this Agreement
against payment of the consideration set forth herein, will be validly
issued and fully paid and non-assessable undivided beneficial interests in
the Trust, will be entitled to the benefits of the Trust Agreement and will
in all material respects conform to the statements relating thereto
contained in the Prospectus; the issuance of the Capital Securities is not
subject to preemptive or other similar rights; and holders of Capital
Securities will be entitled to the same limitation of personal liability
under Delaware law as extended to stockholders of private corporations for
profit.

(xv) The Indenture, the Trust Agreement, the Guarantee Agreement
and the Expense Agreement are in substantially the respective forms filed
as exhibits to the Registration Statement.

(xvi) The Company's obligations under the Guarantee are
subordinated and junior in right of payment to all "Senior and Subordinated
Debt" (as defined in the Indenture) of the Company.

(xvii) The Junior Subordinated Debentures are subordinate and
junior in right of payment to all "Senior and Subordinated Debt" of the
Company.

(xviii) Each of the Administrative Trustees of the Trust is an
employee of the Company and has been duly authorized by the Company to
execute and deliver the Trust Agreement.

(xix) The Trust and the Company and each of its Subsidiaries
holds, and is operating in compliance in all material respects with, all
franchises, grants, authorizations, licenses, permits, easements, consents,
certificates and orders of any governmental or self-regulatory body
required for the conduct of its business and all such franchises, grants,
authorizations, licenses, permits, easements, consents, certifications and
orders are valid and in full force and effect, the failure to hold or
operate in compliance with the foregoing or the lack of a validity, force
or effect of the foregoing would not have a material adverse effect on the
condition (financial or otherwise), earnings, business, prospects, assets,
results of operations or properties of the Company and its subsidiaries
taken as a whole; and the Trust and the Company and each of its
subsidiaries is and has been in compliance in all material respects with
all applicable federal, state, local and foreign laws, regulations, orders
and decrees, except to the extent that the failure to comply would not have
a material adverse effect on the condition (financial or otherwise),
earnings, business, prospects, assets, results of operations or properties
of the Company and its subsidiaries taken as a whole.

(xx) The Company and its Subsidiaries have good title to all
property (and good and marketable title to all real property) described in
the Registration Statement and Prospectus as being owned by them, in each
case free and clear of all liens, claims, security interests or other
encumbrances except such as are described in the Registration Statement and
the Prospectus or which do not interfere in any material respect with the
use of the property on the Conduct of the business of the Company and its
subsidiaries; the property held under lease by the Company and its
Subsidiaries is held by them under valid, subsisting and enforceable leases
with only such exceptions with respect to any particular lease as do not
interfere in any material respect with the conduct of the business of the
Company or its subsidiaries; the Company and each of its subsidiaries owns
or possesses all patents, patent applications, trademarks, service marks,
tradenames, trademark

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<PAGE>

registrations, service mark registrations, copyrights, licenses,
inventions, trade secrets and rights necessary for the conduct of the
business of the Company and its subsidiaries as currently carried on and as
described in the Registration Statement and Prospectus; except as stated in
the Registration Statement and Prospectus, to the best of the Company's
knowledge, no name which the Company or any of its Subsidiaries uses and no
other aspect of the business of the Company or any of its Subsidiaries will
involve or give rise to any infringement of, or license or similar fees
for, any patents, patent applications, trademarks, service marks,
tradenames, trademark registrations, service mark registrations,
copyrights, licenses, inventions, trade secrets or other similar rights of
others material to the business or prospects of the Company and neither the
Company nor any of its Subsidiaries has received any notice alleging any
such infringement or fee.

(xxi) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or bylaws; the Trust is not in
violation of the Trust Agreement or its Certificate of Trust; none of the
Company, any of its Subsidiaries or the Trust is in breach of or otherwise
in default in the performance of any material obligation, agreement or
condition contained in any bond, debenture, note, indenture, loan agreement
or any other material contract, lease or other instrument to which it is
subject or by which any of them may be bound, or to which any of the
material property or assets of the Company, any of its Subsidiaries or the
Trust is subject.

(xxii) The Trust and the Company and its Subsidiaries have filed
all federal, state, local and foreign income and franchise tax returns
required to be filed and are not in default in the payment of any taxes
which were payable pursuant to said returns or any assessments with respect
thereto, other than any which the Company or any of its subsidiaries is
contesting in good faith.

(xxiii) The Offerors have not distributed and will not distribute
any prospectus or other offering material in connection with the offering
and sale of the Capital Securities and the Common Stock other than any
Preliminary Prospectus or the Prospectus or other materials permitted by
the Act to be distributed by the Company.

(xxiv) The Company and its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurances
that (i) transactions are executed in accordance with management's general
or specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.

(xxv) Other than as contemplated by this Agreement or described in
the Registration Statement, the Company has not incurred any liability for
any finder's or broker's fee or agent's commission in connection with the
execution and delivery of this Agreement, the Merger Agreement or the
consummation of the transactions contemplated hereby or thereby.

(xxvi) Neither the Trust, the Company or any of its Subsidiaries is
an "investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended, or an "investment adviser" within the meaning of the Investment
Advisers Act of 1940, as amended.

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<PAGE>

(xxvii) No report or application filed by the Company or any of its
Subsidiaries with the FRB, OCC, Department or the FDIC, as of the date it
was filed, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading when made or failed to comply with
the applicable requirements of the FRB, OCC, Department or the FDIC, as the
case may be.

(xxviii) The proceeds from the sale of the Capital Securities will
constitute "tier 1" capital (as defined in 12 C.F.R. Part 325).

(xxix) Neither of the Offerors nor any of their affiliates is
presently doing business with the government of Cuba or with any person or
affiliate located in Cuba.

(b) Any certificate signed by any officer of the Company or a trustee
of the Trust and delivered to either Underwriter or to counsel for either
Underwriter shall be deemed a representation and warranty by the Company to you
as to the matters covered thereby.

3. PURCHASE, SALE AND DELIVERY OF CAPITAL SECURITIES; ADVISORY FEE.

On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth, the Trust
agrees to issue and sell 2,400,000 Capital Securities to you, and you agree to
purchase the Capital Securities from the Trust at a purchase price per Capital
Security of $25.00 per share. As compensation to the Underwriters for their
commitments hereunder and in view of the fact that the proceeds of the sale of
the Capital Securities (together with the entire proceeds from the sale by the
Trust to the Company of the Common Securities) will be used to purchase the
Junior Subordinated Debentures, the Company hereby agrees to pay at the Closing
Date to you, a commission per Capital Security equal in amount to
_________________ (______%) of the gross proceeds from the sale of the Capital
Securities to be delivered by the Trust hereunder at the Closing Date.

The Capital Securities will be delivered by the Company to you against
payment of the purchase price therefor by certified or official bank check or
other next day funds payable to the Company at the offices of Piper Jaffray
Inc., Piper Jaffray Tower, 222 South Ninth Street, Minneapolis, Minnesota, or
such other location as may be mutually acceptable, at 9:00 a.m. Central time on
the third (or if the Capital Securities are priced, as contemplated by Rule
15c6-1(c) under the Exchange Act, after 4:30 p.m. Eastern time, on the fourth)
full business day following the date hereof, or at such other time and date as
you and the Company determine pursuant to Rule 15c6-1(a) under the Exchange Act,
such time and date of delivery being herein referred to as the "Closing Date."
Delivery of the Capital Securities may be made by credit through full fast
transfer to the accounts at The Depository Trust Company designated by you.
Certificates representing the Capital Securities, in definitive form and in such
denominations and registered in such names as you may request upon at least two
business days' prior notice to the Company shall be prepared and will be made
available for checking and packaging, not later than 10:30 a.m., Central time,
on the business day next preceding the Closing Date at the offices of Piper
Jaffray Inc., Piper Jaffray Tower, 222 South Ninth Street, Minneapolis,
Minnesota, or such other location as may be mutually acceptable.

It is understood that each Underwriter may (but shall not be obligated
to) make payment to the Company on behalf of the other Underwriter for the
Securities to be purchased by such Underwriter. Any such payment shall not
relive such other Underwriter of any of its obligations hereunder. Nothing
herein contained shall constitute either of the Underwriters an unincorporated
association or partner with either or both Offerors.

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<PAGE>

4. COVENANTS.

(a) The Offerors jointly and severally covenant and agree with the
Underwriters as follows:

(i) If the Registration Statement has not already been declared
effective by the Commission, the Company will use its best efforts to cause
the Registration Statement and any post-effective amendments thereto to
become effective as promptly as possible; the Company will notify you
promptly of the time when the Registration Statement or any post-effective
amendment to the Registration Statement has become effective or any
supplement to the Prospectus (including any term sheet within the meaning
of Rule 434 of the Rules and Regulations) has been filed and of any request
by the Commission for any amendment or supplement to the Registration
Statement or Prospectus or additional information; if the Company has
elected to rely on Rule 430A of the Rules and Regulations, the Company will
prepare and file a Prospectus (or term sheet within the meaning of Rule 434
of the Rules and Regulations) containing the information omitted therefrom
pursuant to Rule 430A of the Rules and Regulations with the Commission
within the time period required by, and otherwise in accordance with the
provisions of, Rules 424(b), 430A and 434, if applicable, of the Rules and
Regulations; if the Company has elected to rely upon Rule 462(b) of the
Rules and Regulations to increase the size of the offering registered under
the Act, the Company will prepare and file a registration statement with
respect to such increase with the Commission within the time period
required by, and otherwise in accordance with the provisions of,
Rule 462(b); the Offerors will prepare and file with the Commission,
promptly upon your request, any amendments or supplements to the
Registration Statement or Prospectus (including any term sheet within the
meaning of Rule 434 of the Rules and Regulations) that, in your opinion,
may be necessary or advisable in connection with your distribution of the
Capital Securities; and the Offerors will not file any amendment or
supplement to the Registration Statement or Prospectus (including any term
sheet within the meaning of Rule 434 of the Rules and Regulations) to which
you shall reasonably object by notice to the Company after having been
furnished a copy a reasonable time prior to the filing.

(ii) The Offerors will advise the Underwriters, promptly after
they shall receive notice or obtain knowledge thereof, of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement, of the suspension of the qualification of the
Capital Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceeding for any such purpose; and the
Offerors will promptly use their best efforts to prevent the issuance of
any stop order or to obtain its withdrawal if such a stop order should be
issued.

(iii) Within the time during which a prospectus (including any
term sheet within the meaning of Rule 434 of the Rules and Regulations)
relating to the Capital Securities is required to be delivered under the
Act, the Offerors will comply as far as it is able with all requirements
imposed upon it by the Act, as now and hereafter amended, and by the Rules
and Regulations, as from time to time in force, so far as necessary to
permit the continuance of sales of or dealings in the Capital Securities as
contemplated by the provisions hereof and the Prospectus. If during such
period any event occurs as a result of which the Prospectus would include
an untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
then existing, not misleading, or if during such period it is necessary to
amend the Registration Statement or supplement the Prospectus to comply
with the Act, the Offerors will promptly notify the Underwriters and will
amend the Registration Statement or supplement the

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<PAGE>

Prospectus (at the expense of the Company) so as to correct such statement
or omission or effect such compliance.

(iv) The Offerors will use their best efforts to qualify the
Capital Securities and the Junior Subordinated Debentures for sale under
the securities laws of such jurisdictions as the Underwriters may
reasonably designate and to continue such qualifications in effect so long
as required for the distribution of the Capital Securities, except that the
Offerors shall not be required in connection therewith to qualify as a
foreign corporation or to execute a general consent to service of process
in any state.

(v) The Offerors will furnish to the Underwriters copies of the
Registration Statement (three of which will be signed and will include all
exhibits), each of the Preliminary Prospectuses, the Prospectus, and all
amendments and supplements (including any term sheet within the meaning of
Rule 434 of the Rules and Regulations) to such documents, in each case as
soon as available and in such quantities as each Underwriter may from time
to time reasonably request.

(vi) During a period of five years commencing with the date
hereof, the Company will furnish to the Underwriters copies of all periodic
and special reports furnished to the stockholders of the Company and all
information, documents and reports filed with the Commission.

(vii) The Company will make generally available to its security
holders and holders of the Capital Securities as soon as practicable, but
in any event not later than 15 months after the end of the Company's
current fiscal quarter, an earnings statement (which need not be audited)
covering a 12-month period beginning after the effective date of the
Registration Statement that shall satisfy the provisions of Section 11(a)
of the Act and Rule 158 of the Rules and Regulations.

(viii) The Company, whether or not the transactions contemplated
hereunder are consummated or this Agreement is prevented from becoming
effective under the provisions of Section 8(a) hereof or is terminated,
will pay or cause to be paid (A) all expenses (including transfer taxes
allocated to the respective transferees) incident to the performance of the
obligations of each Offeror under this agreement, (B) all expenses and fees
(including, without limitation, fees and expenses of each Offeror's
accountants and counsel but, except as otherwise provided below, not
including fees of the Underwriter's counsel) in connection with the
preparation, printing, filing, delivery, and shipping of the Registration
Statement (including the financial statements therein and all amendments,
schedules, and exhibits thereto), the Capital Securities, each Preliminary
Prospectus, the Prospectus, and any amendment thereof or supplement
thereto, and the printing, delivery, and shipping of this Agreement and
other underwriting documents, including Blue Sky Memoranda, (C) all filing
fees and fees and disbursements of the Underwriters' counsel incurred in
connection with the qualification of the Capital Securities for offering
and sale by you or by dealers under the securities or blue sky laws of the
states and other jurisdictions which you shall designate, (D) the fees and
expenses of any transfer agent or registrar, (E) the filing fees incident
to any required review by the National Association of Capital Securities
Dealers, Inc. ("NASD") of the terms of the sale of the Capital Securities,
(F) listing fees, if any, (G) the fees and expenses of the Indenture
Trustee, including the fees and disbursements of counsel for the Indenture
Trustee in connection with the Indenture and Junior Subordinated
Debentures, (H) the fees and expenses of the Property Trustee, including
the fees and disbursements of counsel for the Property Trustee in
connection with the Trust Agreement and the Certificate of Trust, and (I)
all other costs and expenses incident to the performance of the Offerors'
obligations hereunder that are not

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<PAGE>

otherwise specifically provided for herein. If the sale of the Capital
Securities provided for herein is not consummated by reason of action by
either Offeror pursuant to Section 8(a) hereof which prevents this
Agreement from becoming effective, or by reason of any failure, refusal or
inability on the part of either Offeror to perform any agreement on its
part to be performed, or because any other condition of your obligations
hereunder required to be fulfilled by either Offeror is not fulfilled, the
Company will reimburse you for all out-of-pocket disbursements (including
fees and disbursements of counsel) incurred by the Underwriters in
connection with their investigation, preparing to market and marketing the
Capital Securities or in contemplation of performing their obligations
hereunder. Neither Offeror shall in any event be liable to you for loss of
anticipated profits from the transactions covered by this Agreement.

(ix) The Offerors will apply the net proceeds from the sale of
the Capital Securities to be sold by the Trust hereunder for the purposes
set forth in the Prospectus and will file such reports with the Commission
with respect to the sale of the Capital Securities and the application of
the proceeds therefrom as may be required in accordance with Rule 463 of
the Rules and Regulations.

(x) The Offerors have not taken and will not take, directly or
indirectly, any action designed to or which might reasonably be expected to
cause or result in, or which has constituted, the stabilization or
manipulation of the price of any security of either Offeror to facilitate
the sale or resale of the Capital Securities, and has not effected any
sales of Common Stock which are required to be disclosed in response to
Item 701 of Regulation S-K under the Act which have not been so disclosed
in the Registration Statement.

(xi) Neither Offeror will incur any liability for any finder's or
broker's fee or agent's commission in connection with the execution and
delivery of this Agreement or the consummation of the transactions
contemplated hereby.

(xii) The Offerors will inform the Florida Department of Banking
and Finance at any time prior to the consummation of the distribution of
the Capital Securities by you if it commences engaging in business with the
government of Cuba or with any person or affiliate located in Cuba. Such
information will be provided within 90 days after the commencement thereof
or after a change occurs with respect to previously reported information.

5. CONDITIONS OF UNDERWRITER'S OBLIGATIONS. The obligations of the
Underwriters hereunder are subject to the accuracy, as of the date hereof and at
the Closing Date (as if made at the Closing Date), of and compliance with all
representations, warranties and agreements of the Offerors contained herein, to
the performance by each Offeror of its obligations hereunder and to the
following additional conditions:

(a) The Registration Statement shall have become effective not later
than 5:00 p.m., Central time, on the date of this Agreement, or such later time
and date as you shall approve and all filings required by Rules 424, 430A and
434 of the Rules and Regulations shall have been timely made; no stop order
suspending the effectiveness of the Registration Statement or any amendment
thereof shall have been issued and no proceedings for the issuance of such an
order shall have been initiated or threatened; and any request of the Commission
for additional information (to be included in the Registration Statement or the
Prospectus or otherwise) shall have been complied with to your satisfaction.

(b) The Underwriters shall not have advised the Company or the Trust
that the Registration Statement or the Prospectus, or any amendment thereof or
supplement thereto (including any

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<PAGE>

term sheet within the meaning of Rule 434 of the Rules and Regulations),
contains an untrue statement of fact which, in your opinion, is material, or
omits to state a fact which, in your opinion, is material and is required to be
stated therein or necessary to make the statements therein not misleading.

(c) Except as contemplated in the Prospectus, subsequent to the
respective dates as of which information is given in the Registration Statement
and the Prospectus, neither the Trust, the Company nor any of its Subsidiaries
shall have incurred any material liabilities or obligations, direct or
contingent, or entered into any material transactions, or declared or paid any
dividends or made any distribution of any kind with respect to its capital
stock; and there shall not have been any change in the capital stock (other than
a change in the number of outstanding shares of Common Stock due to the issuance
of shares upon the exercise of outstanding options or warrants), or any material
change in the short-term or long-term debt of the Company, or any issuance of
options, warrants, convertible securities or other rights to purchase the
capital stock of the Company or any of its subsidiaries, or any material adverse
change or any development involving a prospective material adverse change
(whether or not arising in the ordinary course of business), in the general
affairs, condition (financial or otherwise), business, key personnel, property,
prospects, net worth or results of operations of the Trust or the Company and
its Subsidiaries, taken as a whole, that, in your judgment, makes it impractical
or inadvisable to offer or deliver the Capital Securities on the terms and in
the manner contemplated in the Prospectus.

(d) On the Closing Date, there shall have been furnished to the
Underwriters the opinion of Lindquist & Vennum, counsel for the Company, dated
the Closing Date and addressed to the Underwriters, to the effect that:

(i) Each of the Company and its Subsidiaries has been duly
organized and is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware and is duly registered as a bank holding
company under the BHC Act. The deposit accounts of each of the Company's
subsidiaries that is a bank are insured by the FDIC, and, to the knowledge
of such counsel, no proceedings for the termination or revocation of such
membership or insurance are pending or threatened. Each of the Company and
its Subsidiaries has full corporate power and authority to own its
properties and conduct its business as currently being carried on and as
described in the Registration Statement and Prospectus, and is duly
qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which its ownership or lease of real property or
the conduct of its business makes such qualification necessary and in which
the failure to so qualify would have a material adverse effect upon the
business, condition (financial or otherwise) or properties of the Company
and its Subsidiaries, taken as a whole.

(ii) The capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus under the
caption "Capitalization," "Description of the Junior Subordinated
Debentures." All of the issued and outstanding shares of the capital stock
of the Company have been duly authorized and validly issued and are fully
paid and nonassessable, and the holders thereof are not subject to personal
liability by reason of being such holders. Except as otherwise stated in
the Registration Statement and Prospectus, there are no preemptive rights
or options, warrants, agreements, contracts or other rights in existence to
purchase or acquire from the Company any shares of the capital stock of the
Company pursuant to the Company's charter, bylaws or any agreement or other
instrument known to such counsel to which the Company is a party or by
which the Company is bound. To the best of such counsel's knowledge,
neither the filing of the Registration Statement nor the offering or sale
of the Junior Subordinated Debentures or

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<PAGE>

Capital Securities as contemplated by this Agreement gives rise to any
rights for or relating to the registration of any shares of Common Stock or
other securities of the Company.

(iii) All of the issued and outstanding shares of capital stock of
each of the Company's Subsidiaries have been duly and validly authorized
and issued and are fully paid and nonassessable, and, to the best of such
counsel's knowledge, except as otherwise described in the Registration
Statement and Prospectus and except for directors' qualifying shares, the
Company owns of record and beneficially, free and clear of any security
interests, claims, liens, proxies, equities or other encumbrances in the
case of the Subsidiaries set forth on Exhibit A attached hereto, that
percentage of shares of the issued and outstanding shares of such
Subsidiaries' stock as is set forth on such Exhibit A. To the best of such
counsel's knowledge, except as described in the Registration Statement and
Prospectus, there are no options, warrants, agreements, contracts or other
rights in existence to purchase or acquire from the Company or any of its
Subsidiaries any shares of the capital stock of any Subsidiary of the
Company.

(iv) All of the issued and outstanding Common Securities of the
Trust are owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equitable right.

(v) The Trust Agreement has been duly qualified under the Trust
Indenture Act.

(vi) The Junior Subordinated Debentures are in the form
contemplated by the Indenture, have been duly authorized, executed and
delivered by the Company and, when authenticated by the Indenture Trustee
in the manner provided for in the Indenture and delivered against payment
therefor, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except to
the extent that enforcement thereof may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting the rights of
creditors generally and subject to general principles of equity.

(vii) The Junior Subordinated Debentures are subordinate and
junior in right of payment to all "Senior and Subordinated Debt" (as
defined in the Indenture) of the Company.

(viii) Neither the Company nor the Trust is an "investment company"
or a company "controlled" by an "investment company" within the meaning of
the 1940 Act.

(ix) The statements set forth in the Prospectus under the caption
"Certain Federal Income Tax Consequences" constitute a fair and accurate
summary of the matters addressed therein, based upon current law and the
assumptions stated or referred to therein.

(x) Under current law, the Trust will be classified for United
States federal income tax purposes as a grantor trust and not as an
association taxable as a corporation; accordingly, for United States
federal income tax purposes each beneficial owner of Capital Securities
will be treated as owning an undivided beneficial interest in the Junior
Subordinated Debentures, and stated interest on the Junior Subordinated
Debentures generally will be included in income by a holder of Capital
Securities at the time such interest income is paid or accrued in
accordance with such holder's regular method of tax accounting.

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(xi) For federal income tax purposes, (a) the Junior Subordinated
Debentures will constitute indebtedness of the Company and (b) the interest
on the Junior Subordinated Debentures will be deductible by the Company on
an economic accrual basis in accordance with Section 163(e) of the Internal
Revenue Code of 1986, as amended, and Treasury Regulation Section 1.163-7.

(xii) To the best of such counsel's knowledge and information
after due inquiry, the Trust is not required to be authorized to do
business in any other jurisdiction and the Trust is not a party to or
otherwise bound by any agreement other than those described in the
Prospectus.

(xiii) The Trust Agreement has been duly authorized, executed and
delivered by the Company, the Property Trustee and the Administrative
Trustees.

(xiv) The Trust is not in violation of its Certificate of Trust or
the Trust Agreement or, to the best of such counsel's knowledge and
information after due inquiry, in default in the performance or observance
of any material obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note, lease or any other
instrument of which the Trust is a party or by which it may be bound, or to
which any of the property or assets of the Trust is subject.

(xv) The Registration Statement has become effective under the
Act and, to the best of such counsel's knowledge, no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of
such counsel, threatened by the Commission.

(xvi) The descriptions in the Registration Statement and
Prospectus of statutes, and to the best of counsel's knowledge, legal and
governmental proceedings or rulings, contracts and other documents are
accurate in all material respects and fairly present the information
required to be shown; and such counsel does not know of any statutes or
legal or governmental proceedings required to be described in the
Prospectuses that are not described as required, or of any contracts or
documents of a character required to be described in the Registration
Statement or Prospectus or included as exhibits to the Registration
Statement that are not described or included as required.

(xvii) The reports of the Company incorporated by reference in the
Registration Statement and the Prospectus or any further amendment or
supplement thereto made by the Company (other than the financial
statements, other financial data and related schedules therein, as to which
such counsel need express no opinion), when they were filed with the
Commission, complied as to form in all material respects with the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder.

(xviii) The Company has full corporate power and authority and the
Trust has full trust power and authority to enter into this Agreement, the
Indenture, the Trust Agreement, the Guarantee Agreement and the Expense
Agreement to which it is a party and to issue the Junior Subordinated
Debentures and Capital Securities, as the case may be, and to effect the
transactions contemplated by this Agreement, the Indenture, the Trust
Agreement, the Guarantee Agreement and the Expense Agreement to which it is
a party, and each of this Agreement, the Indenture, the Trust Agreement,
the Guarantee Agreement and the Expense Agreement is duly authorized,
executed and

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<PAGE>

delivered by the Company and the Trust, as applicable, and constitutes a
valid, legal and binding obligation of the Company enforceable in
accordance with its terms (except as rights to indemnity hereunder may be
limited by federal or state securities laws and except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or
similar laws affecting the rights of creditors generally and subject to
general principles of equity). The execution, delivery and performance of
this Agreement, the Indenture, the Trust Agreement, the Guarantee
Agreement, the Capital Securities, the Common Securities, the Junior
Subordinated Debentures and the Guarantee and the consummation of the
transactions herein or therein contemplated will not result in a breach or
violation of any of the terms and provisions of, or constitute a default
under, any statute, rule or regulation, any agreement or instrument known
to such counsel to which the Company or the Trust is a party or by which
either is bound or to which any of their property is subject, the Company's
charter or bylaws, or the Trust's Certificate or any order or decree known
to such counsel of any court or governmental agency or body having
jurisdiction over the Company or the Trust or any of its respective
properties, except for any breach, violation or default which would not
have a material adverse effect on the Company; and no consent, approval,
authorization or order of, or filing with, any court or governmental agency
or body is required for the execution, delivery and performance of this
Agreement, the Indenture, the Trust Agreement, the Guarantee Agreement, the
Expense Agreement, the Capital Securities, the Junior Subordinated
Debentures, or the Guarantee or for the consummation of the transactions
contemplated hereby or thereby, including the issuance or sale of the
Junior Subordinated Debentures by the Company and the Common Securities and
Capital Securities by the Trust, except (a) such as may be required under
the Act, which has been obtained, or under state securities or blue sky
laws, and (b) the qualification of the Trust Agreement, the Guarantee
Agreement and the Indenture under the Trust Indenture Act and the
regulations thereunder.

(xix) To the best of such counsel's knowledge, neither the Company
nor any of its subsidiaries is in violation of its respective charter or
bylaws.

(xx) The Registration Statement and the Prospectus, and any
amendment thereof or supplement thereto (including any term sheet within
the meaning of Rule 434 of the Rules and Regulations), comply as to form in
all material respects with the requirements of the Act and the Rules and
Regulations; and on the basis of conferences with officers of the Company,
examination of documents referred to in the Registration Statement and
Prospectus and such other procedures as such counsel deemed appropriate,
nothing has come to the attention of such counsel that causes such counsel
to believe that the Registration Statement or any amendment thereof, at the
time such Registration Statement became effective and as of the Closing
Date (including any Registration Statement filed under Rule 462(b) of the
Rules and Regulations), contained any untrue statement of a material fact
or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus (as of their respective dates and as of the Closing Date), as
amended or supplemented, includes any untrue statement of material fact or
omits to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; it
being understood that such counsel need express no opinion as to the
financial statements or other financial data included in any of the
documents mentioned in this clause.

(xxi) Such other matters as you may reasonably request.

In rendering such opinion such counsel may rely (i) as to matters of
law other than Minnesota and federal law, upon the opinion or opinions of local
counsel provided that the extent of such

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<PAGE>

reliance is specified in such opinion and that such counsel shall state that
such opinion or opinions of local counsel are satisfactory to them and that they
believe they and you are justified in relying thereon and (ii) as to matters of
fact, to the extent such counsel deems reasonable upon certificates of officers
of the Company and its subsidiaries and of public officials provided that the
extent of such reliance is specified in such opinion.

(e) The favorable opinion, dated as of Closing Date, of Richards,
Layton & Finger, counsel to Wilmington Trust Company, as Property Trustee under
the Trust Agreement, Indenture Trustee under the Indenture, and Guarantee
Trustee under the Guarantee Agreement, in form and substance satisfactory to
counsel for the Underwriters, to the effect that:

(i) Wilmington Trust Company is duly incorporated and is validly
existing in good standing as a banking corporation under the laws of the
State of Delaware.

(ii) Wilmington Trust Company has the power and authority to
execute, deliver and perform its obligations under the Trust Agreement, the
Indenture and the Guarantee Agreement.

(iii) Each of the Trust Agreement, the Indenture and the Guarantee
Agreement have been duly authorized, executed and delivered by Wilmington
Trust Company and constitutes a legal, valid and binding obligation of
Wilmington Trust Company, enforceable against Wilmington Trust Company, in
accordance with its terms.

(iv) The execution, delivery and performance by Wilmington Trust
Company of the Trust Agreement, the Indenture and the Guarantee Agreement
do not conflict with or constitute a breach of the charter or by-laws of
Wilmington Trust Company.

(v) No consent, approval or authorization of, or registration
with or notice to, any governmental authority or agency of the State of
Delaware or the United States of America governing the banking or trust
powers of Wilmington Trust Company is required for the execution, delivery
or performance by the Wilmington Trust Company of the Trust Agreement, the
Indenture and the Guarantee Agreement.

(f) The favorable opinion, dated as of Closing Date, of Richards,
Layton & Finger, as special Delaware counsel for the Offerors, in form and
substance satisfactory to counsel for the Underwriters, to the effect that:

(i) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act, and all filings
required as of the date hereof under the Delaware Act with respect to the
creation and valid existence of the Trust as a business trust have been
made.

(ii) Under the Trust Agreement and the Delaware Act, the Trust
has the trust power and authority to own property and to conduct its
business, all as described in the Prospectus.

(iii) The Trust Agreement constitutes a valid and binding
obligation of the Company and each of the Property Trustee and the
Administrative Trustees, and is enforceable

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<PAGE>

against the Company and each of the Property Trustee and the Administrative
Trustees, in accordance with its terms.

(iv) Under the Trust Agreement and the Delaware Act, the Trust
has the trust power and authority (i) to execute and deliver, and to
perform its obligations under, this Agreement, and (ii) to issue, and to
perform its obligations under, the Capital Securities and the Common
Securities.

(v) Under the Trust Agreement and the Delaware Act, the
execution and delivery by the Trust of this Agreement, and the performance
by the Trust of its obligations under this Agreement, have been duly
authorized by all necessary trust action on the part of the Trust.

(vi) Under the Delaware Act, the certificate attached to the
Trust Agreement as Exhibit E is an appropriate form of certificate to
evidence ownership of the Capital Securities. The Capital Securities and
the Common Securities have been duly authorized by the Trust Agreement and
are duly and validly issued and, subject to the qualifications hereinafter
expressed in this paragraph (vi), fully paid and non-assessable undivided
beneficial interests in the assets of the Trust. The respective holders of
the Capital Securities and the Common Securities, as beneficial owners of
the Trust, will 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. We note that the
respective holders of the Capital Securities and the Common Securities may
be obligated, pursuant to the Trust Agreement, to make certain payments
under the Trust Agreement.

(vii) Under the Trust Agreement and the Delaware Act, the issuance
of the Capital Securities and the Common Securities is not subject to
preemptive or similar rights.

(viii) The issuance and sale by the Trust of the Capital Securities
and the Common Securities, the purchase by the Trust of the Junior
Subordinated Debentures, the execution, delivery and performance by the
Trust of this Agreement and the Guarantee Agreement, the consummation by
the Trust of the transactions contemplated by this Agreement and compliance
by the Trust with its obligations under this Agreement do not violate (a)
any of the provisions of the Certificate of Trust or the Trust Agreement,
or (b) any applicable Delaware law or Delaware administrative regulation.

(g) On the Closing Date, there shall have been furnished such opinion
or opinions from Faegre & Benson LLP, counsel for the Underwriters, dated the
Closing Date and addressed to the Underwriters, with respect to the formation of
the Company, the validity of the Capital Securities, the Indenture, the
Guarantee Agreement, this Agreement, the Registration Statement, the Prospectus
and other related matters as the Underwriters reasonably may request, and such
counsel shall have received such papers and information as they request to
enable them to pass upon such matters.

(h) On the Closing Date you shall have received a letter from Ernst &
Young LLP, dated the Closing Date and addressed to the Underwriters, confirming
that they are independent public accountants within the meaning of the Act and
are in compliance with the applicable requirements relating to the
qualifications of accountants under Rule 2-01 of Regulation S-X of the
Commission, that the Trust is and will be treated as a consolidated Subsidiary
of the Company pursuant to generally accepted accounting principles, and
stating, as of the date of such letter (or, with respect to matters involving
changes or

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<PAGE>

developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five days
prior to the date of such letter), the conclusions and findings of each said
firm with respect to the financial information and other matters covered by its
letter delivered to the Underwriters concurrently with the execution of this
Agreement, and the effect of the letter so to be delivered on the Closing Date
shall be to confirm the conclusions and findings set forth in such prior letter.

(i) On the Closing Date, there shall have been furnished to you, a
certificate, dated the Closing Date and addressed to you, signed by the chief
executive officer and by the chief financial officer of the Company, to the
effect that:

(i) The representations and warranties of the Company in this
Agreement are true and correct, in all material respects, as if made at and
as of the Closing Date, and the Offerors have complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to the Closing Date;

(ii) No stop order or other order suspending the effectiveness of
the Registration Statement or any amendment thereof or the qualification of
the Capital Securities for offering or sale has been issued, and no
proceeding for that purpose has been instituted or, to the best of their
knowledge, is contemplated by the Commission or any state or regulatory
body; and

(iii) The signers of said certificate have carefully examined the
Registration Statement and the Prospectus, and any amendments thereof or
supplements thereto (including any term sheet within the meaning of Rule
434 of the Rules and Regulations), and (A) such documents contain all
statements and information required to be included therein, the
Registration Statement, or any amendment thereof, does not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and the Prospectus, as amended or supplemented, does not
include any untrue statement of material fact or omit to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (B) since the
effective date of the Registration Statement, there has occurred no event
required to be set forth in an amended or supplemented prospectus which has
not been so set forth, (C) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
neither the Trust, the Company nor any of its Subsidiaries has incurred any
material liabilities or obligations, direct or contingent, or entered into
any material transactions, not in the ordinary course of business, or
declared or paid any dividends or made any distribution of any kind with
respect to its capital stock (other than dividends paid in the ordinary
course with respect to shares of the Company's Common Stock or any of its
subsidiaries' common stock), and except as disclosed in the Prospectus,
there has not been any change in the capital stock (other than a change in
the number of outstanding shares of Common Stock due to the issuance of
shares upon the exercise of outstanding options or warrants), or any
material change in the short-term or long-term debt, or any issuance of
options, warrants, convertible securities or other rights to purchase the
capital stock, of the Company, or any of its Subsidiaries, or any material
adverse change or any development involving a prospective material adverse
change (whether or not arising in the ordinary course of business), in the
general affairs, condition (financial or otherwise), business, key
personnel, property, prospects, net worth or results of operations of the
Trust or the Company and its Subsidiaries, taken as a whole, and (D) except
as stated in the Registration Statement and the Prospectus, there is not
pending, or, to the knowledge of the Company or the Trust, threatened or
contemplated, any action, suit or proceeding to which the Trust, the
Company or any of its Subsidiaries is a party before or by any court or
governmental agency, authority or body, or any arbitrator, which might
result in any material adverse change in

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<PAGE>

the condition (financial or otherwise), business, prospects or results of
operations of the Company and its subsidiaries, taken as a whole.

(j) On the Closing Date, there shall have been furnished to the
Underwriters, a certificate, dated the Closing Date and addressed to the
Underwriters, signed by the Administrative Trustees, to the effect that:

(i) The representations and warranties of the Trust in this
Agreement are true and correct, in all material respects, as if made at and
as of the Closing Date, and the Trust has complied with all the agreements
and satisfied all the conditions on its part to be performed or satisfied
at or prior to the Closing Date;

(iii) The signers of said certificate have carefully examined the
Registration Statement and the Prospectus, and any amendments thereof or
supplements thereto (including any term sheet within the meaning of Rule
434 of the Rules and Regulations), and (a) such documents contain all
statements and information required to be included therein, the
Registration Statement, or any amendment thereof, does not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and the Prospectus, as amended or supplemented, does not
include any untrue statement of material fact or omit to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (B) since the
effective date of the Registration Statement, there has occurred no event
required to be set forth in an amended or supplemented prospectus which has
not been so set forth, (C) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, the
Trust has not incurred any material liabilities or obligations, direct or
contingent, or entered into any material transactions, not in the ordinary
course of business, or declared or paid any dividends or made any
distribution of any kind with respect to its capital securities, and except
as disclosed in the Prospectus, there has not been any change in the
capital securities, or any material change in the short-term or long-term
debt, or any issuance of options, warrants, convertible securities or other
rights to purchase the capital securities, of the Trust or any material
adverse change or any development involving a prospective material adverse
change (whether or not arising in the ordinary course of business), in the
general affairs, condition (financial or otherwise), business, key
personnel, property, prospects, net worth or results of operations of the
Trust, and (D) except as stated in the Registration Statement and the
Prospectus, there is not pending, or, to the knowledge of the Trust,
threatened or contemplated, any action, suit or proceeding to which the
Trust is a party before or by any court or governmental agency, authority
or body, or any arbitrator, which might result in any material adverse
change in the condition (financial or otherwise), business, prospects or
results of operations of the Trust.

(k) The Company shall have furnished to you and to your counsel such
additional documents, certificates and evidence as you or they may have
reasonably requested.

All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are satisfactory in form
and substance to you and your counsel.

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<PAGE>

6. INDEMNIFICATION AND CONTRIBUTION.

(a) The Offerors agree to indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which you may become subject, under the Act or otherwise (including
in settlement of any litigation if such settlement is effected with the written
consent of the Company), insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, including the information deemed to be a part of the
Registration Statement at the time of effectiveness pursuant to Rules 430A and
434(d) of the Rules and Regulations, if applicable, any Preliminary Prospectus,
the Prospectus, or any amendment or supplement thereto (including any term sheet
within the meaning of Rule 434 of the Rules and Regulations), or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by it in connection with investigating or defending against
such loss, claim, damage, liability or action; provided, however, that the
Offerors shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, any Preliminary Prospectus, the Prospectus, or any
such amendment or supplement, in reliance upon and in conformity with written
information furnished to the Offerors by the Underwriters specifically for use
in the preparation thereof.

In addition to its other obligations under this Section 6(a), each of
the Company and the Trust agree that, as an interim measure during the pendency
of any claim, action, investigation, inquiry or other proceeding arising out of
or based upon any statement or omission, or any alleged statement or omission,
described in this Section 6(a), it will reimburse you on a monthly basis for all
reasonable legal fees or other expenses incurred in connection with
investigating or defending any such claim, action, investigation, inquiry or
other proceeding, notwithstanding the absence of a judicial determination as to
the propriety and enforceability of the Offerors' obligation to reimburse you
for such expenses and the possibility that such payments might later be held to
have been improper by a court of competent jurisdiction. To the extent that any
such interim reimbursement payment is so held to have been improper, you shall
promptly return it to the party or parties that made such payment, together with
interest, compounded daily, determined on the basis of the prime rate (or other
commercial lending rate for borrowers of the highest credit standing) announced
from time to time by Norwest Bank Minnesota, N.A. (the "Prime Rate"). This
indemnity agreement shall be in addition to any liabilities which the Company
may otherwise have.

(b) Each Underwriter will indemnify and hold harmless the Company and
the Trust against any losses, claims, damages or liabilities to which the
Company and the Trust may become subject, under the Act or otherwise (including
in settlement of any litigation, if such settlement is effected with your
written consent), insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto (including any term sheet within the meaning of Rule 434 of
the Rules and Regulations), or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by you

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<PAGE>

for use in the preparation thereof, and will reimburse the Company and the Trust
for any legal or other expenses reasonably incurred by the Company and the Trust
in connection with investigating or defending against any such loss, claim,
damage, liability or action.

(c) The Company agrees to indemnify the Trust against all loss,
liability, claim damage and expense whatsoever, which may become due from the
Trust under subsection (a).

(d) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve the indemnifying party from any liability
that it may have to any indemnified party. In case any such action shall be
brought against any indemnified party, and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of the indemnifying party's
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that if, in the sole judgment of the Underwriters, it is advisable for the
underwriters as a group to be represented by separate counsel, the Underwriters
shall have the right to employ a single counsel to represent all Underwriters
who may be subject to a liability arising from any claim in respect of which
indemnity may be sought by the Underwriters under this Section 6, in which
event the reasonable fees and expenses of such separate counsel shall be borne
by the indemnifying party or parties and remitted to the Underwriters for
payment to such counsel as such fees and expenses are incurred (in accordance
with the provisions of the second paragraph in subsection (a) above). An
indemnifying party shall not be obligated under any settlement agreement
relating to any action under this Section 6 to which it has not agreed in
writing.

(e) If the indemnification provided for in this Section 6 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above,
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company or the Trust on the one hand and the Underwriters on the
other from the offering of the Capital Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the Trust
on the one hand and the Underwriters on the other in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Trust on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Company bear to the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company, the Trust or the Underwriters' and the parties'
relevant intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The Company and the Trust and you
agree that it would not be just and equitable if contributions pursuant to this
subsection (e) were to be determined by pro rata allocation or by any other
method of allocation which does not take account of the equitable

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considerations referred to in the first sentence of this subsection (e). The
amount paid by an indemnified party as a result of the losses, claims, damages
or liabilities referred to in the first sentence of this subsection (e) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending against any
action or claim which is the subject of this subsection (e). Notwithstanding
the provisions of this subsection (e), no Underwriter shall not be required to
contribute any amount in excess of the amount by which the total price at which
the Capital Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages that such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters obligations in this Section (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint.

(f) The obligations of the Company under this Section 6 shall be in
addition to any liability which the Company and the Trust may otherwise have and
shall extend, upon the same terms and conditions, to each person, if any, who
controls the Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section 6 shall be in addition to any liability that
the respective Underwriter may otherwise have and shall extend, upon the same
terms and conditions, to each director of the Company (including any person who,
with his or her consent, is named in the Registration Statement as about to
become a director of the Company), to each officer of the Company who has signed
the Registration Statement and to each person, if any, who controls the Company
or the Trust within the meaning of the Act.

7. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties, and agreements of the Offerors herein or in
certificates delivered pursuant hereto, and the agreements of the Offerors and
you contained in Section 6 hereof shall remain operative and in full force and
effect regardless of any investigation made by you or on your behalf or any
controlling person thereof, or the Company or any of its officers, directors, or
controlling persons or the Trust or any if its trustees, or controlling persons
and shall survive delivery of, and payment for, the Capital Securities to and by
the Underwriters hereunder.

8. EFFECTIVE DATE OF THIS AGREEMENT AND TERMINATION.

(a) This Agreement shall become effective at 10:00 a.m., Central
time, on the first full business day following the effective date of the
Registration Statement, or at such earlier time after the effective time of the
Registration Statement as the Underwriters in their discretion shall first
release the Capital Securities for sale to the public; provided, that if the
Registration Statement is effective at the time this Agreement is executed, this
Agreement shall become effective at such time as the Underwriters in their
discretion shall first release the Capital Securities for sale to the public.
For the purpose of this Section, the Capital Securities shall be deemed to have
been released for sale to the public upon release by you of the publication of a
newspaper advertisement relating thereto or upon release by the Underwriters of
telexes offering the Capital Securities for sale to securities dealers,
whichever shall first occur. By giving notice as hereinafter specified before
the time this Agreement becomes effective, the Underwriters, the Trust or the
Company may prevent this Agreement from becoming effective without liability of
any party to any other party, except that the provisions of Section 4(a)(viii)
and Section 6 hereof shall at all times be effective.

(b) The Underwriters shall have the right to terminate this Agreement
by giving notice as hereinafter specified at any time at or prior to the Closing
Date, if (i) either Offeror shall have failed, refused or been unable, at or
prior to the Closing Date, to perform any agreement on its part to be performed
hereunder, (ii) any other condition of your obligations hereunder is not
fulfilled, (iii) trading in securities on the New York Stock Exchange or the
Nasdaq Stock Market shall have been suspended or

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limited or minimum prices shall have been established on such Exchange or
System, (iv) a banking moratorium shall have been declared by Federal, New York,
North Dakota, South Dakota or Colorado authorities, or (v) there has occurred
any material adverse change in the financial markets in the United States or an
outbreak of major hostilities (or an escalation thereof) in which the United
States is involved, a declaration of war by Congress, any other substantial
national or international calamity or any other event or occurrence of a similar
character shall have occurred since the execution of this Agreement that, in
your judgment, makes it impractical or inadvisable to proceed with the
completion of the sale of and payment for the Capital Securities. Any such
termination shall be without liability of any party to any other party except
that the provisions of Section 4(a)(viii) and Section 6 hereof shall at all
times be effective.

(c) If the Underwriters elect to prevent this Agreement from becoming
effective or to terminate this Agreement as provided in this Section, the
Company shall be notified promptly by the Underwriters by telephone or telegram,
confirmed by letter. If the Trust or the Company elects to prevent this
Agreement from becoming effective, the Underwriters shall be notified by the
Trust or the Company by telephone or telegram, confirmed by letter.

9. DEFAULT BY THE COMPANY. If the Trust shall fail at the Closing Date
to sell and deliver the number of Capital Securities which it is obligated to
sell hereunder or the Company fails to deliver the number of Junior Subordinated
Debentures required to be delivered pursuant to the Trust Agreement, then this
Agreement shall terminate without any liability on the part of any
non-defaulting party. No action taken pursuant to this Section shall relieve
the Trust or the Company so defaulting from liability, if any, in respect of
such default.

10. INFORMATION FURNISHED BY UNDERWRITERS. The statements set forth in
the last paragraph of the cover page and under the caption "Underwriting" in any
Preliminary Prospectus and in the Prospectus constitute the written information
furnished by the Underwriters or on their behalf referred to in Section 2 and
Section 6 hereof.

11. NOTICES. Except as otherwise provided herein, all communications
hereunder shall be in writing or by telegraph and, if to you, shall be mailed,
telegraphed or delivered to Piper Jaffray Inc., Piper Jaffray Tower, 222 South
Ninth Street, Minneapolis, Minnesota 55402; if to the Company, shall be mailed,
telegraphed or delivered to it at 1520 Main Avenue, Fargo, North Dakota 58124-
0001, Attention: Donald R. Mengedoth if to the Trust, shall be mailed
lithographed or delivered to it at Rodney Square North, 1100 North Market
Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust
Administration. All notices given by telegram shall be promptly confirmed by
letter. Any notice to the Trust shall also be copied to the Company at the
address previously stated, Attention: Donald R. Mengedoth. Any party to this
Agreement may change such address for notices by sending to the parties to this
Agreement written notice of a new address for such purpose.

12. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors and assigns and the controlling persons, officers and directors
referred to in Section 6. Nothing in this Agreement is intended or shall be
construed to give to any other person, firm or corporation any legal or
equitable remedy or claim under or in respect of this Agreement or any provision
herein contained. The term "successors and assigns" as herein used shall not
include any purchaser, as such purchaser, of any of the Capital Securities from
any of the Underwriters.

13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota.

-24-

<PAGE>

[Signature Page Follows]

-25-

<PAGE>

SCHEDULE I

Underwriter Capital Securities
- ----------- ------------------
Piper Jaffray Inc. $
Dain Bosworth Incorporated $___________

Total .................................... $___________
___________

-26-

<PAGE>
EXHIBIT A

COMMUNITY FIRST BANKSHARES, INC.

SUBSIDIARIES

OWNERSHIP
SUBSIDIARY BANK: LOCATION: PERCENTAGE

Community First National Bank Fergus Falls, MN 100.000%
Community First National Bank Fargo, ND 100.000%
Community First State Bank Vermillion, ND 98.923%
Community First State Bank Redfield, SD 99.641%
Community First State Bank Decorah, IA 99.880%
Community First State Bank Alliance, NE 99.537%
Community First State Bank Spooner, WI 99.493%
Colorado Community First National Bank Ft. Morgan, CO 100.000%
Colorado Community First State Bank SteamBoat, CO 100.000%
Colorado Community First National Bank Trinidad, CO 100.000%
Colorado Community First State Bank - CO Denver, CO 100.000%

NONBANK SUBSIDIARIES:

Community First Financial, Inc. Fargo, ND 100.000%
Community First Service Corporation Fargo, ND 100.000%
Community Insurance, Inc. Fargo, ND 100.000%
Community First Properties, Inc. Fargo, ND 100.000%

RECENTLY ACQUIRED SUBSIDIARIES TO MERGED
DISSOLVED/MERGED:

Mountain Parks Data Corporation 100.000%
Mountain Parks Financial Consulting Corp. 100.000%

OTHER AFFILIATES:

Vail Banks Inc. Vail, CO 24.690%

SUBSIDIARIES OF SUBSIDIARIES (100% OWNED):

Community First Insurance Agencies, Inc. Vermilion, SD (Subsidiary of
Community First
State Bank
[Vermillion,
SD])
CFIN, Inc. Las Vegas, NV (Subsidiary of
Community First
State Bank
[Spooner])

-27-

<PAGE>

Please sign and return to the Company the enclosed duplicates of this
letter whereupon this letter will become a binding agreement between the Company
and you in accordance with its terms.

Very truly yours,

COMMUNITY FIRST BANKSHARES, INC.

By__________________________________________
Its____________________________________

CFB CAPITAL I

By__________________________________________
Its____________________________________

Confirmed as of the date first
above mentioned.

PIPER JAFFRAY INC.

By_________________________________
Managing Director

DAIN BOSWORTH INCORPORATED

By_________________________________
Managing Director

-28-

<PAGE>

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

COMMUNITY FIRST BANKSHARES, INC.,

AS ISSUER

WILMINGTON TRUST COMPANY,

AS TRUSTEE

-------------------------------
SUBORDINATED INDENTURE
-------------------------------

Dated as of _____________, 1997

____% Junior Subordinated Debentures

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

<PAGE>

TABLE OF CONTENTS

PAGE

ARTICLE I
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE II
DESCRIPTION, TERMS, CONDITIONS, REGISTRATION AND EXCHANGE OF THE JUNIOR
SUBORDINATED DEBENTURES . . . . . . . . . . . . . . . . . . . . . . 7
2.1 Designation and Principal Amount . . . . . . . . . . . . . . . 7
2.2 Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.3 Form and Payment . . . . . . . . . . . . . . . . . . . . . . . 7
2.4 Global Subordinated Debenture. . . . . . . . . . . . . . . . . 8
2.5 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.6 Execution, Authentication, Delivery and Dating . . . . . . . .10
2.7 Registration and Transfer. . . . . . . . . . . . . . . . . . .10
2.8 Mutilated, Destroyed, Lost and Stolen Junior Subordinated
Debentures . . . . . . . . . . . . . . . . . . . . . . . . . .11

ARTICLE III
REDEMPTION OF JUNIOR SUBORDINATED DEBENTURES . . . . . . . . . . . . . .11
3.1 Redemption . . . . . . . . . . . . . . . . . . . . . . . . . .11
3.2 Special Event Redemption . . . . . . . . . . . . . . . . . . .11
3.3 Optional Redemption by Company . . . . . . . . . . . . . . . .12
3.4 Notice of Redemption . . . . . . . . . . . . . . . . . . . . .12
3.5 Payment upon Redemption. . . . . . . . . . . . . . . . . . . .13
3.6 No Sinking Fund. . . . . . . . . . . . . . . . . . . . . . . .14

ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD . . . . . . . . . . . . . . . . . .14
4.1 Extension of Interest Payment Period . . . . . . . . . . . . .14
4.2 Notice of Extension. . . . . . . . . . . . . . . . . . . . . .14
4.3 Limitation of Transactions During Extension. . . . . . . . . .15

ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY. . . . . . . . . . . . . . . . . . .15
5.1 Payment of Principal and Interest. . . . . . . . . . . . . . .15
5.2 Maintenance of Agency. . . . . . . . . . . . . . . . . . . . .15
5.3 Paying Agents. . . . . . . . . . . . . . . . . . . . . . . . .15
5.4 Appointment to Fill Vacancy in Office of Trustee . . . . . . .16
5.5 Compliance with Consolidation Provisions . . . . . . . . . . .16
5.6 Restrictions on Certain Payments . . . . . . . . . . . . . . .16
5.7 Covenants as to the Trust. . . . . . . . . . . . . . . . . . .16

ARTICLE VI
SECURITYHOLDERS' LISTS AND REPORTS . . . . . . . . . . . . . . . . . . .17
6.1 Company to Furnish Trustee Names and Addresses of
Securityholders. . . . . . . . . . . . . . . . . . . . . . . .17
6.2 Preservation of Information; Communications with
Securityholders. . . . . . . . . . . . . . . . . . . . . . . .17
6.3 Reports by the Company . . . . . . . . . . . . . . . . . . . .17
6.4 Reports by the Trustee . . . . . . . . . . . . . . . . . . . .18

<PAGE>

ARTICLE VII
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT. . . . .18
7.1 Events of Default. . . . . . . . . . . . . . . . . . . . . . .18
7.2 Collection of Indebtedness and Suits for Enforcement by
Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . .20
7.3 Application of Moneys Collected. . . . . . . . . . . . . . . .21
7.4 Limitation on Suits. . . . . . . . . . . . . . . . . . . . . .21
7.5 Rights and Remedies Cumulative; Delay or Omission Not Waiver .22
7.6 Control by Securityholders . . . . . . . . . . . . . . . . . .22
7.7 Undertaking to Pay Costs . . . . . . . . . . . . . . . . . . .23

ARTICLE VIII
FORM OF JUNIOR SUBORDINATED DEBENTURE AND ORIGINAL ISSUE . . . . . . . .23
8.1 Form of Junior Subordinated Debenture. . . . . . . . . . . . .23
8.2 Original Issue of Junior Subordinated Debentures . . . . . . .23

ARTICLE IX
CONCERNING THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . .23
9.1 Certain Duties and Responsibilities of the Trustee . . . . . .23
9.2 Certain Rights of Trustee. . . . . . . . . . . . . . . . . . .24
9.3 Trustee Not Responsible for Recitals or Issuance of the Junior
Subordinated Debentures. . . . . . . . . . . . . . . . . . . .25
9.4 May Hold Junior Subordinated Debentures. . . . . . . . . . . .25
9.5 Moneys Held in Trust . . . . . . . . . . . . . . . . . . . . .25
9.6 Compensation and Reimbursement . . . . . . . . . . . . . . . .25
9.7 Reliance on Officers' Certificate. . . . . . . . . . . . . . .26
9.8 Disqualification; Conflicting Interests . . . . . . . . . . .26
9.9 Corporate Trustee Required; Eligibility. . . . . . . . . . . .26
9.10 Resignation and Removal; Appointment of Successor. . . . . . .26
9.11 Acceptance of Appointment by Successor . . . . . . . . . . . .27
9.12 Merger, Conversion, Consolidation or Succession to Business. .28
9.13 Preferential Collection of Claims Against the Company. . . . .28
9.14 Appointment of Authenticating Agent. . . . . . . . . . . . . .28

ARTICLE X
CONCERNING THE SECURITYHOLDERS . . . . . . . . . . . . . . . . . . . . .29
10.1 Evidence of Action by Securityholders. . . . . . . . . . . . .29
10.2 Proof of Execution by Securityholders. . . . . . . . . . . . .30
10.3 Who May Be Deemed Owners . . . . . . . . . . . . . . . . . . .30
10.4 Certain Junior Subordinated Debentures Owned by Company
Disregarded. . . . . . . . . . . . . . . . . . . . . . . . . .30
10.5 Actions Binding on Future Securityholders. . . . . . . . . . .31

ARTICLE XI
SUPPLEMENTAL INDENTURES. . . . . . . . . . . . . . . . . . . . . . . . .31
11.1 Supplemental Indentures Without the Consent of
Securityholders. . . . . . . . . . . . . . . . . . . . . . . .31
11.2 Supplemental Indentures with Consent of Securityholders. . . .32
11.3 Effect of Supplemental Indentures. . . . . . . . . . . . . . .32
11.4 Junior Subordinated Debentures Affected by Supplemental
Indentures . . . . . . . . . . . . . . . . . . . . . . . . . .32
11.5 Execution of Supplemental Indentures . . . . . . . . . . . . .32

<PAGE>

ARTICLE XII
SUCCESSOR CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . .33
12.1 Company May Consolidate, Etc.. . . . . . . . . . . . . . . . .33
12.2 Successor Substituted. . . . . . . . . . . . . . . . . . . . .33
12.3 Evidence of Consolidation, Etc., to Trustee. . . . . . . . . .33

ARTICLE XIII
SATISFACTION AND DISCHARGE. . . . . . . . . . . . . . . . . . . . . . . .33
13.1 Satisfaction and Discharge of Indenture. . . . . . . . . . . .34
13.2 Discharge of Obligations . . . . . . . . . . . . . . . . . . .34
13.3 Deposited Moneys to Be Held in Trust . . . . . . . . . . . . .34
13.4 Payment of Monies Held by Paying Agents. . . . . . . . . . . .34
13.5 Repayment to Company . . . . . . . . . . . . . . . . . . . . .34

ARTICLE XIV
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS . . . . .35
14.1 No Recourse. . . . . . . . . . . . . . . . . . . . . . . . . .35

ARTICLE XV
MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . . . . . . . . . . . .35
15.1 Effect on Successors and Assigns . . . . . . . . . . . . . . .35
15.2 Actions by Successor . . . . . . . . . . . . . . . . . . . . .35
15.3 Surrender of Company Powers. . . . . . . . . . . . . . . . . .35
15.4 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . .35
15.5 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . .36
15.6 Treatment of Junior Subordinated Debentures as Debt. . . . . .36
15.7 Compliance Certificates and Opinions . . . . . . . . . . . . .36
15.8 Payments on Business Days. . . . . . . . . . . . . . . . . . .36
15.9 Conflict with Trust Indenture Act. . . . . . . . . . . . . . .36
15.10 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . .36
15.11 Separability . . . . . . . . . . . . . . . . . . . . . . . . .36
15.12 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . .37
15.13 Acknowledgment of Rights . . . . . . . . . . . . . . . . . . .37

ARTICLE XVI
SUBORDINATION OF JUNIOR SUBORDINATED DEBENTURES . . . . . . . . . . . . .37
16.1 Agreement to Subordinate . . . . . . . . . . . . . . . . . . .37
16.2 Default on Senior and Subordinated Debt. . . . . . . . . . . .37
16.3 Liquidation; Dissolution; Bankruptcy . . . . . . . . . . . . .38
16.4 Subrogation. . . . . . . . . . . . . . . . . . . . . . . . . .39
16.5 Trustee to Effectuate Subordination. . . . . . . . . . . . . .39
16.6 Notice by the Company. . . . . . . . . . . . . . . . . . . . .39
16.7 Rights of the Trustee; Holders of Senior and Subordinated
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40
16.8 Subordination May Not Be Impaired. . . . . . . . . . . . . . .40

iii

<PAGE>

COMMUNITY FIRST BANKSHARES, INC.
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939, AS AMENDED
AND SUBORDINATED INDENTURE, DATED AS OF __________, 1997

Trust Indenture Act Subordinated
Section Indenture Section
- ------------------- -----------------

Section 310. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 310 (b). . . . . . . . . . . . . . . . . . . . . . . . . . 9.8

Section 311. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 311 (a). . . . . . . . . . . . . . . . . . . . . . . . . . 9.13
(b). . . . . . . . . . . . . . . . . . . . . . . . . . 9.13

Section 312. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 312 (b). . . . . . . . . . . . . . . . . . . . . . . . . . 6.2

Section 313. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 313 (a). . . . . . . . . . . . . . . . . . . . . . . . . . 6.4
(b). . . . . . . . . . . . . . . . . . . . . . . . . . 6.4
(c). . . . . . . . . . . . . . . . . . . . . . . . . . 6.4

Section 314. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9

Section 315. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9

Section 316. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9

Section 317. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.9

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

<PAGE>

SUBORDINATED INDENTURE (the "Indenture"), dated as of ___________, 1997,
among Community First Bankshares, Inc., a Delaware corporation (the
"Company") and Wilmington Trust Company, a Delaware banking corporation, as
trustee (the "Trustee");

WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of its securities to be known as its _____ % Junior Subordinated
Debentures due 2027 (hereinafter referred to as the "Junior Subordinated
Debentures"), the form and substance of such Junior Subordinated Debentures
and the terms, provisions and conditions thereof to be set forth as provided
in this Indenture; and

WHEREAS, CFB Capital I, a Delaware statutory business trust (the
"Trust"), has offered to the public $____________ aggregate liquidation
amount of its ___% Cumulative Capital Securities (the "Capital Securities"),
representing undivided beneficial interests in the assets of the Trust and
proposes to invest the proceeds from such offering, together with the
proceeds of the issuance and sale by the Trust to the Company of $___ million
aggregate liquidation amount of its ___% Trust Common Securities, in $____
million aggregate principal amount of the Junior Subordinated Debentures; and

WHEREAS, the Company has requested that the Trustee execute and deliver
this Indenture and all requirements necessary to make this Indenture a valid
instrument in accordance with its terms, and to make the Junior Subordinated
Debentures, when executed by the Company and authenticated and delivered by
the Trustee, the valid obligations of the Company; and

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

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

NOW, THEREFORE, in consideration of the premises and the purchase of the
Junior Subordinated Debentures by the holders thereof, it is mutually
covenanted and agreed as follows for the equal and ratable benefit of the
holders of Junior Subordinated Debentures:

ARTICLE I
---------
DEFINITIONS

The terms defined in this Section (except as in this Indenture otherwise
expressly provided or unless the context otherwise requires) for all purposes
of this Indenture and of any indenture supplemental hereto shall have the
respective meanings specified in this Section and shall include the plural as
well as the singular. All other terms used in this Indenture that are
defined in the Trust Indenture Act of 1939, as amended, or that are by
reference in said Trust Indenture Act defined in the Securities Act of 1933,
as amended (except as herein otherwise expressly provided or unless the
context otherwise requires), shall have the meanings assigned to such terms
in said Trust Indenture Act and in said Securities Act as in force at the
date of the execution of this Indenture.

"Accelerated Maturity Date" means, if the Company elects to accelerate
the Maturity Date in accordance with Section 2.2(c), the date selected by the
Company which is prior to the Scheduled Maturity Date, but is after
____________, 2002.

<PAGE>

"Administrative Trustees" has the meaning set forth in the Trust
Agreement.

"Additional Sums" shall have the meaning set forth in Section 2.5.

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

"Authenticating Agent" means an authenticating agent with respect to the
Junior Subordinated Debentures appointed by the Trustee pursuant to Section
9.14.

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

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

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

"Business Day" means any day other than a day on which Federal or State
banking institutions in the State of Minnesota are authorized or obligated by
law, executive order or regulation to close or a day on which the Trustee is
closed.

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

"Capital Securities Certificate" has the meaning set forth in the Trust
Agreement.

"Capital Treatment Event" means the reasonable determination by the
Company that, as a result of any amendment to, or change (including any
proposed change) in, the laws (or any regulations thereunder) of the United
States or any political subdivision thereof or therein, or as a result of any
official or adminstrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change
is effective or such proposed change, pronouncement or decision is announced
on or after the date of issuance of the Capital Securities under the Trust
Agreement, there is more than an insubstantial risk of impairment of the
Company's ability to treat the Capital Securities (or any substantial
portion thereof) 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 the Company.

"Capital Securities Guarantee" means any guarantee that the Company may
enter into with the Property Trustee or other Persons that operates directly
or indirectly for the benefit of holders of Capital Securities of the Trust.

"Certificate" means a certificate signed by the principal executive
officer, the principal financial officer or the principal accounting officer
of the Company. The Certificate need not comply with the provisions of
Section 15.7.

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

<PAGE>

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

"Company" means Community First Bankshares, Inc., a corporation duly
organized and existing under the laws of the State of Delaware, and, subject
to the provisions of Article Twelve, shall also include its successors and
assigns.

"Compounded Interest" shall have the meaning set forth in Section 4.1.

"Corporate Trust Office" means the office of the Trustee at which, at any
particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at Rodney Square
North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention:
Corporate Trust Administration.

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

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

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

"Deferred Interest" shall have the meaning set forth in Section 4.1.

"Depositary" means, with respect to Junior Subordinated Debentures issued
as a Global Subordinated Debenture, The Depository Trust Company, New York,
New York, another clearing agency, or any successor registered as a clearing
agency under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or other applicable statute or regulation, which, in each case, shall
be designated by the Company pursuant to either Section 2.1 or 2.4.

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

"Distributions" shall have the meaning set forth in the Trust Agreement.

"Event of Default" means any event specified in Section 7.1, continued
for the period of time, if any, therein designated.

<PAGE>

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

"Extended Interest Payment Period" shall have the meaning set forth in
Section 4.1.

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

"Global Subordinated Debenture" means a Junior Subordinated Debenture
executed by the Company and delivered by the Trustee to the Depositary or
pursuant to the Depositary's instruction, all in accordance with this
Indenture, which shall be registered in the name of the Depositary or its
nominee.

"Governmental Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America, the payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America that, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depositary receipt issued by a bank (as defined in
Section 3(a)(2) of the Securities Act of 1933, as amended) as custodian with
respect to any such Governmental Obligation or a specific payment of
principal of or interest on any such Governmental Obligation held by such
custodian for the account of the holder of such depositary receipt; provided,
however, that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depositary
receipt from any amount received by the custodian in respect of the
Governmental Obligation or the specific payment of principal of or interest
on the Governmental Obligation evidenced by such depositary receipt.

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

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

"Interest Payment Date," when used with respect to any installment of
interest on the Junior Subordinated Debentures, means the date specified in
the Junior Subordinated Debenture as the fixed date on which an installment
of interest with respect to the Junior Subordinated Debentures is due and
payable.

"Investment Company Act" means the Investment Company Act of 1940, as
amended.

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

"Junior Subordinated Debentures" means the ___% Junior Subordinated
Debentures authenticated and delivered under this Indenture.

"Liquidation Amount" means the stated amount of $25 per Trust Security.

"Maturity Date" shall have the meaning set forth in Section 2.2.

<PAGE>

"Non Book-Entry Capital Securities" shall have the meaning set forth in
Section 2.4.

"Officers' Certificate" means a certificate signed by the President or a
Vice President and by the Chief Financial Officer or the Controller or an
Assistant Controller or the Secretary or an Assistant Secretary of the
Company that is delivered to the Trustee in accordance with the terms hereof.
Each such certificate shall include the statements provided for in Section
15.7, if and to the extent required by the provisions thereof.

"Opinion of Counsel" means an opinion in writing of legal counsel, who
may be an employee of or counsel for the Company, that is delivered to the
Trustee in accordance with the terms hereof. Each such opinion shall include
the statements provided for in Section 15.7, if and to the extent required by
the provisions thereof.

"Outstanding," when used with reference to Junior Subordinated Debentures
means, subject to the provisions of Section 10.4, as of any particular time,
all Junior Subordinated Debentures theretofore authenticated and delivered by
the Trustee under this Indenture, except (a) Junior Subordinated Debentures
theretofore canceled by the Trustee or any paying agent, or delivered to the
Trustee or any paying agent for cancellation or that have previously been
canceled; (b) Junior Subordinated Debentures or portions thereof for the
payment or redemption of which moneys or Governmental Obligations in the
necessary amount shall have been deposited in trust with the Trustee or with
any paying agent (other than the Company) or shall have been set aside and
segregated in trust by the Company (if the Company shall act as its own
paying agent); provided, however, that if such Junior Subordinated Debentures
or portions of such Junior Subordinated Debentures are to be redeemed prior
to the maturity thereof, notice of such redemption shall have been given as
in Article Three provided, or provision satisfactory to the Trustee shall
have been made for giving such notice; and (c) Junior Subordinated Debentures
in lieu of or in substitution for which other Junior Subordinated Debentures
shall have been authenticated and delivered pursuant to the terms of Section
2.8.

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

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

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

"Redemption Price" means the amount equal to 100% of the principal amount
of Junior Subordinated Debentures to be redeemed plus any accrued and unpaid
interest thereon to the date of the redemption of such Junior Subordinated
Debentures.

"Responsible Officer" when used with respect to the Trustee means the
Chairman of the Board of Directors, the President, any Vice President, the
Secretary, the Treasurer, any trust officer, any corporate trust officer or
any other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by the Persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is
referred because of his or her knowledge of and familiarity with the
particular subject.

"Scheduled Maturity Date" means __________, 2027.

"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 2.7.

<PAGE>

"Securityholder," "Holder," "Holder of Securities," "Registered Holder,"
or other similar term, means the Person or Persons in whose name or names a
particular Junior Subordinated Debenture shall be registered in the
Securities Register.

"Senior and Subordinated Debt" means the principal of (and premium, if
any) and interest, if any (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Company
whether or not such claim for post-petition interest is allowed in such
proceeding), on Debt, whether incurred on or prior to the date of this
Indenture or thereafter incurred, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is
provided that such obligations are not superior in right of payment to the
Junior Subordinated Debentures or to other Debt which is pari passu with, or
subordinated to, the Junior Subordinated Debentures; provided, however, that
Senior and Subordinated Debt shall not be deemed to include (i) any Debt of
the Company which when incurred and without respect to any election under
section 1111(b) of the United States Bankruptcy Code of 1978, as amended, was
without recourse to the Company, (ii) any Debt of the Company to any of its
subsidiaries, (iii) any Debt to any employee of the Company, (iv) any Debt
which by its terms is subordinated to trade accounts payable or accrued
liabilities arising in the ordinary course of business to the extent that
payments made to the holders of such Debt by the holders of the Junior
Subordinated Debentures as a result of the subordination provisions of this
Indenture would be greater than they otherwise would have been as a result of
any obligation of such holders to pay amounts over to the obligees on such
trade accounts payable or accrued liabilities arising in the ordinary course
of business as a result of subordination provisions to which such Debt is
subject, (v) the Capital Securities Guarantee, and (vi) any other debt
securities issued pursuant to this Indenture.

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

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

"Tax Event" means the receipt by the Company and the Trust of an Opinion
of Counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement 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 Junior Subordinated Debentures there is more than an insubstantial
risk that (i) interest payable by the Company on the Junior Subordinated
Debentures is not, or within 90 days after the date of such Opinion of
Counsel will not be, deductible by the Company, in whole or in part, for
United States federal income tax purposes; (ii) the Trust is, or will be
within 90 days after the date of such Opinion of Counsel, subject to United
States federal income tax with respect to income received or accrued on the
Junior Subordinated Debentures, or (iii) the Trust is, or will be within 90
days after the date of such Opinion of Counsel, subject to more than a de
minimis amount of other taxes, duties, assessments or other governmental
charges.

"Trust" means CFB Capital I, a Delaware statutory business trust created
for the purpose of issuing Trust Securities in connection with the issuance
of Junior Subordinated Debentures under this Indenture.

"Trust Agreement" means the Amended and Restated Trust Agreement, dated
as of ____________, 1997, of the Trust.

<PAGE>

"Trustee" means Wilmington Trust Company and, subject to the provisions
of Article Nine, shall also include its successors and assigns, and, if at
any time there is more than one Person acting in such capacity hereunder,
"Trustee" shall mean each such Person.

"Trust Indenture Act," means the Trust Indenture Act of 1939 as in force
at the date of execution of this Indenture; 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 Securities" means Common Securities and Capital Securities of the
Trust.

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

ARTICLE II
----------
DESCRIPTION, TERMS, CONDITIONS, REGISTRATION AND
EXCHANGE OF THE JUNIOR SUBORDINATED DEBENTURES

2.1 DESIGNATION AND PRINCIPAL AMOUNT. There is hereby authorized a
series of Securities designated the "___% Junior Subordinated Debentures due
2027", limited in aggregate principal amount to $____________, which amount
shall be as set forth in any written order of the Company for the
authentication and delivery of Junior Subordinated Debentures pursuant to
Section 8.2 of this Indenture.

2.2 MATURITY.

(a) The Maturity Date will be either:

(i) the Scheduled Maturity Date; or

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

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

(c) If the Company elects to accelerate the Maturity Date in accordance
with Section 2.2(b), the Company shall give notice to the registered holders
of the Junior Subordinated Debentures, the Property Trustee and the Trust of
the acceleration of the Maturity Date and the Accelerated Maturity Date at
least 90 days before the Accelerated Maturity Date.

2.3 FORM AND PAYMENT. Except as provided in Section 2.4, the Junior
Subordinated Debentures shall be issued in fully registered certificated form
without interest coupons. Principal and interest on the Junior Subordinated
Debentures issued in certificated form will be payable, the transfer of such
Junior Subordinated Debentures will be registrable and such Junior
Subordinated Debentures will be exchangeable for Junior Subordinated
Debentures bearing identical terms and provisions at the office or agency of
the Trustee; provided,

<PAGE>

however, that payment of interest may be made at the option of the Company by
check mailed to the Holder at such address as shall appear in the Securities
Register. Notwithstanding the foregoing, so long as the Holder of any Junior
Subordinated Debentures is the Property Trustee, the payment of the principal
of and interest (including Compounded Interest and Additional Sums, if any)
on such Junior Subordinated Debentures held by the Property Trustee will be
made at such place and to such account as may be designated by the Property
Trustee.

2.4 GLOBAL SUBORDINATED DEBENTURE.

(a) In connection with a Dissolution Event,

(i) the Junior Subordinated Debentures in certificated form may be
presented to the Trustee by the Property Trustee in exchange for a global
Junior Subordinated Debenture in an aggregate principal amount equal to the
aggregate principal amount of all outstanding Junior Subordinated
Debentures (a "Global Subordinated Debenture"), to be registered in the
name of the Depositary, or its nominee, and delivered by the Trustee to the
Depositary for crediting to the accounts of its participants pursuant to
the instructions of the Administrative Trustees. The Company upon any such
presentation shall execute a Global Subordinated Debenture in such
aggregate principal amount and deliver the same to the Trustee for
authentication and delivery in accordance with this Indenture. Payments on
the Junior Subordinated Debentures issued as a Global Subordinated
Debenture will be made to the Depositary; and

(ii) if any Capital Securities are held in non book-entry certificated
form, the Junior Subordinated Debentures in certificated form may be
presented to the Trustee by the Property Trustee and any Capital Securities
Certificate which represents Capital Securities other than Capital
Securities held by the Depositary or its nominee ("Non Book-Entry Capital
Securities") will be deemed to represent beneficial interests in Junior
Subordinated Debentures presented to the Trustee by the Property Trustee
having an aggregate principal amount equal to the aggregate Liquidation
Amount of the Non Book-Entry Capital Securities until such Capital
Securities Certificates are presented to the Securities Registrar for
transfer or reissuance at which time such Capital Securities Certificates
will be canceled and a Junior Subordinated Debenture, registered in the
name of the holder of the Capital Securities Certificate or the transferee
of the holder of such Capital Securities Certificate, as the case may be,
with an aggregate principal amount equal to the aggregate Liquidation
Amount of the Capital Securities Certificate canceled, will be executed by
the Company and delivered to the Trustee for authentication and delivery in
accordance with this Indenture. On issue of such Junior Subordinated
Debentures, Junior Subordinated Debentures with an equivalent aggregate
principal amount that were presented by the Property Trustee to the Trustee
will be deemed to have been canceled.

(b) A Global Subordinated Debenture may be transferred, in whole but not
in part, only to another nominee of the Depositary, or to a successor
Depositary selected or approved by the Company or to a nominee of such
successor Depositary.

(c) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or if at any time the
Depositary for such series shall no longer be registered or in good standing
under the Exchange Act or other applicable statute or regulation, and a
successor Depositary for such series is not appointed by the Company within
90 days after the Company receives such notice or becomes aware of such
condition, as the case may be, the Company will execute, and the Trustee,
upon written notice from the Company, will authenticate and deliver the
Junior Subordinated Debentures in definitive registered form without coupons,
in authorized denominations, and in an aggregate principal amount equal to
the principal amount of the Global Subordinated Debenture in exchange for
such Global Junior Subordinated Debenture. In addition, the Company

<PAGE>

may at any time determine that the Junior Subordinated Debentures shall no
longer be represented by a Global Subordinated Debenture. In such event the
Company will execute, and the Trustee, upon receipt of an Officers'
Certificate evidencing such determination by the Company, will authenticate
and deliver the Junior Subordinated Debentures in definitive registered form
without coupons, in authorized denominations, and in an aggregate principal
amount equal to the principal amount of the Global Subordinated Debenture in
exchange for such Global Subordinated Debenture. Upon the exchange of the
Global Subordinated Debenture for such Junior Subordinated Debentures in
definitive registered form without coupons, in authorized denominations, the
Global Subordinated Debenture shall be canceled by the Trustee. Such Junior
Subordinated Debentures in definitive registered form issued in exchange for
the Global Subordinated Debenture shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Junior Subordinated Debentures to
the Depositary for delivery to the Persons in whose names such Junior
Subordinated Debentures are so registered.

2.5 INTEREST.

(a) Each Junior Subordinated Debenture will bear interest at the rate of
___% per annum (the "Coupon Rate") from the original date of issuance until
the principal thereof becomes due and payable, and on any overdue principal
and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the Coupon Rate,
compounded quarterly, payable (subject to the provisions of Article Four)
quarterly in arrears on the 15th day of April, July, October, and January in
each year (each, an "Interest Payment Date"), commencing on April 15, 1997,
to the Person in whose name such Junior Subordinated Debenture or any
predecessor Junior Subordinated Debenture is registered, at the close of
business on the regular record date for such interest installment, which, in
respect of (i) Junior Subordinated Debentures of which the Property Trustee
is the Holder and the Capital Securities are in book-entry only form or (ii)
a Global Subordinated Debenture, shall be the close of business on the
Business Day next preceding that Interest Payment Date. Notwithstanding the
foregoing sentence, if (i) the Junior Subordinated Debentures are held by the
Property Trustee and the Capital Securities are no longer in book-entry only
form or (ii) the Junior Subordinated Debentures are not represented by a
Global Subordinated Debenture, the record date for such interest installment
which shall be the 1st day of the month in which such payment is to be made.
The amount of each interest payment due with respect to the Junior
Subordinated Debentures will include amounts accrued through the date the
interest payment is due.

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

(c) If, at any time while the Property Trustee is the Holder of any
Junior Subordinated Debentures, the Trust or the Property Trustee is required
to pay any taxes, duties, assessments or governmental charges of whatever
nature (other than withholding taxes) imposed by the United States, or any
other taxing authority, then, in any case, the Company will pay as additional
interest ("Additional Sums") on the Junior Subordinated Debentures held by
the Property Trustee such additional amounts as shall be required so that the
net amounts received and retained by the Trust and the Property Trustee after
paying such taxes, duties, assessments or other

<PAGE>

governmental charges will be equal to the amounts the Trust and the Property
Trustee would have received had no such taxes, duties, assessments or other
government charges been imposed.

2.6 EXECUTION, AUTHENTICATION, DELIVERY AND DATING. The Junior
Subordinated Debentures shall be executed on behalf of the Company by its
President or any Vice President and attested by its Secretary or Assistant
Secretary. The signature of any of these officers on the Subordinated
Debentures may be manual or facsimile.

Junior Subordinated Debentures bearing the manual or facsimile signatures
of individuals who were at any time the proper officers of the Company shall
bind the Company, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of such
Junior Subordinated Debentures or did not hold such offices at the date of
such Junior Subordinated Debentures.

At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Junior Subordinated Debentures
executed by the Company to the Trustee for authentication, together with a
Company order for the authentication and delivery of such Junior Subordinated
Debentures. The Trustee in accordance with such Company order shall
authenticate and deliver such Junior Subordinated Debentures as in this
Indenture provided and not otherwise.

Upon the initial issuance, each Junior Subordinated Debentures shall be
dated ___________, 1997, and thereafter Junior Subordinated Debentures issued
hereunder shall be dated the date of their authentication.

No Junior Subordinated Debenture shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless there appears
on such Junior Subordinated Debenture a certificate of authentication
substantially in the form provided for herein executed by the Trustee by
manual signature, and such certificate upon any Junior Subordinated Debenture
shall be conclusive evidence, and the only evidence, that such Junior
Subordinated Debenture has been duly authenticated and delivered hereunder
and is entitled to the benefits of this Indenture.

2.7 REGISTRATION AND TRANSFER. The Company shall cause to be kept at
the Corporate Trust Office of the Trustee a register (the register maintained
in such office or any other office or agency pursuant to Section 5.2 being
herein sometimes referred to as the "Securities Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of the Junior Subordinated Debentures and of transfers
of the Junior Subordinated Debentures. The Trustee is hereby appointed
"Securities Registrar" for the purpose of registering the Junior Subordinated
Debentures and transfers of the Junior Subordinated Debentures as herein
provided.

Upon surrender for registration of transfer of any Junior Subordinated
Debenture at an office or agency of the Company designated pursuant to
Section 5.2 for such purpose, the Company shall execute, and the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, a new Junior Subordinated Debenture of the authorized
denomination.

All Junior Subordinated Debentures issued upon any registration of
transfer of Junior Subordinated Debentures shall be valid obligations of the
Company, evidencing the same debt and entitled to the same benefits under
this Indenture as the Junior Subordinated Debentures surrendered upon such
registration of transfer.

Every Junior Subordinated Debenture presented or surrendered for
registration of transfer shall be duly endorsed for transfer (if so required
by the Company or the Trustee), or shall be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Securities
Registrar duly executed by the Holder thereof or such Holder's attorney duly
authorized in writing.

<PAGE>

No service charge shall be made for any registration of transfer of Junior
Subordinated Debentures, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer of Junior Subordinated Debentures.

The Company shall not be required to issue or register the transfer of any
Junior Subordinated Debenture during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Junior Subordinated Debentures selected for redemption pursuant to Article Three
and ending at the close of business on the day of such mailing.

2.8 MUTILATED, DESTROYED, LOST AND STOLEN JUNIOR SUBORDINATED DEBENTURES.
If any mutilated Junior Subordinated Debenture is surrendered to the Trustee,
the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Junior Subordinated Debenture of like tenor and
principal amount and bearing a number not contemporaneously outstanding.

If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Junior Subordinated
Debenture and (ii) such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Junior Subordinated Debenture has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen Junior
Subordinated Debenture, a new Junior Subordinated Debenture of like tenor and
principal amount and bearing a number not contemporaneously outstanding.

In case any such mutilated, destroyed, lost or stolen Junior Subordinated
Debenture has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Junior Subordinated Debenture, pay such
Junior Subordinated Debenture.

Upon the issuance of any new Junior Subordinated Debenture under this
Section, the Company may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee) connected
therewith.

Every new Junior Subordinated Debenture issued pursuant to this Section in
lieu of any destroyed, lost or stolen Junior Subordinated Debenture shall
constitute an original additional contractual obligation of the Company, whether
or not the destroyed, lost or stolen Junior Subordinated Debenture shall be at
any time enforceable by anyone, and shall be entitled to all of the benefits of
this Indenture.

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 Junior Subordinated Debentures.

ARTICLE III
REDEMPTION OF JUNIOR SUBORDINATED DEBENTURES

3.1 REDEMPTION. Subject to the Company having received prior approval of
the Federal Reserve, if then required under the applicable capital guidelines or
policies of the Federal Reserve, the Company may redeem the Junior Subordinated
Debentures in accordance with this Article Three.

3.2 SPECIAL EVENT REDEMPTION. Subject to the Company having received the
prior approval of the Federal Reserve, if then required under the applicable
capital guidelines or policies of the Federal Reserve, if a Special Event has
occurred and is continuing, then, notwithstanding Section 3.3, the Company shall
have the right

<PAGE>

upon not less than 30 days nor more than 60 days notice to the Holders of the
Junior Subordinated Debentures to redeem the Junior Subordinated Debentures,
in whole but not in part, for cash within 90 days following the occurrence of
such Special Event (the "90-Day Period") at the Redemption Price, provided
that if at the time there is available to the Company the opportunity to
eliminate, within the 90-Day Period, the Tax Event by taking some ministerial
action ("Ministerial Action"), such as filing a form or making an election,
or pursuing some other similar reasonable measure which has no adverse effect
on the Company, the Trust or the Holders of the Trust Securities issued by
the Trust, the Company shall pursue such Ministerial Action in lieu of
redemption, and, provided, further, that the Company shall have no right to
redeem the Junior Subordinated Debentures while the Trust is pursuing any
Ministerial Action pursuant to its obligations under the Trust Agreement.
The Redemption Price shall be paid prior to 2:00 p.m., Minneapolis time, on
the date of such redemption or such earlier time as the Company determines,
provided that the Company shall deposit with the Trustee an amount sufficient
to pay the Redemption Price by 12:00 noon, Minneapolis time, on the date such
Redemption Price is to be paid.

3.3 OPTIONAL REDEMPTION BY COMPANY.

(a) Except as otherwise may be specified in this Indenture, the Company
shall have the right to redeem the Junior Subordinated Debentures, in whole or
in part, from time to time, on or after ____________, 2002, at the Redemption
Price. Any redemption pursuant to this Section 3.3 will be made upon not less
than 30 days nor more than 60 days notice to the Holder of the Junior
Subordinated Debentures, at the Redemption Price. If the Junior Subordinated
Debentures are only partially redeemed pursuant to this Section 3.3, the Junior
Subordinated Debentures will be redeemed pro rata or by lot or by any other
method utilized by the Trustee; provided, that if at the time of redemption the
Junior Subordinated Debentures are registered as a Global Subordinated
Debenture, the Depositary shall determine, in accordance with its procedures,
the principal amount of such Junior Subordinated Debentures held by each Holder
of Junior Subordinated Debentures to be redeemed. The Redemption Price shall be
paid prior to 2:00 p.m., Minneapolis time, on the date of such redemption or at
such earlier time as the Company determines provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Redemption Price by
12:00 noon, Minneapolis time, on the date such Redemption Price is to be paid.

(b) If a partial redemption of the Junior Subordinated Debentures would
result in the delisting of the Capital Securities issued by the Trust from the
Nasdaq National Market or any national securities exchange or other organization
on which the Capital Securities may then be listed, if any, the Company shall
not be permitted to effect such partial redemption and may only redeem the
Junior Subordinated Debentures in whole.

3.4 NOTICE OF REDEMPTION.

(a) In case the Company shall desire to exercise such right to redeem all
or, as the case may be, a portion of the Junior Subordinated Debentures in
accordance with the right reserved so to do, the Company shall, or shall cause
the Trustee to, give notice of such redemption to Holders of the Junior
Subordinated Debentures to be redeemed by mailing, first class postage prepaid,
a notice of such redemption not less than 30 days and not more than 60 days
before the date fixed for redemption to such Holders at their last addresses as
they shall appear upon the Securities Register. Any notice that is mailed in the
manner herein provided shall be conclusively presumed to have been duly given,
whether or not the registered Holder receives the notice. In any case, failure
duly to give such notice to the Holder of any Junior Subordinated Debenture
designated for redemption in whole or in part, or any defect in the notice,
shall not affect the validity of the proceedings for the redemption of any other
Junior Subordinated Debentures. In the case of any redemption of Junior
Subordinated Debentures prior to the expiration of any restriction on such
redemption provided elsewhere in this Indenture, the Company shall furnish the
Trustee with an Officers' Certificate evidencing compliance with any such
restriction.

<PAGE>

Each such notice of redemption shall specify the date fixed for redemption
and the Redemption Price, and shall state that payment of the Redemption Price
of such Junior Subordinated Debentures to be redeemed will be made at the office
or agency of the Company in Fargo, North Dakota, upon presentation and surrender
of such Junior Subordinated Debentures, that interest accrued to the date fixed
for redemption will be paid as specified in said notice, that from and after
said date interest will cease to accrue. If less than all the Junior
Subordinated Debentures are to be redeemed, the notice to the Holders of Junior
Subordinated Debentures to be redeemed in whole or in part shall specify the
particular Junior Subordinated Debentures to be so redeemed. In case any Junior
Subordinated Debenture is to be redeemed in part only, the notice that relates
to such Junior Subordinated Debenture shall state the portion of the principal
amount thereof to be redeemed, and shall state that on and after the redemption
date, upon surrender of such Junior Subordinated Debenture, a new Junior
Subordinated Debenture or Junior Subordinated Debentures in principal amount
equal to the unredeemed portion thereof shall be issued to the Holder.

(b) If less than all the Junior Subordinated Debentures are to be
redeemed, the Company shall give the Trustee at least 45 days' notice in advance
of the date fixed for redemption as to the aggregate principal amount of Junior
Subordinated Debentures to be redeemed, and thereupon the Trustee shall select,
by lot or in such other manner as it shall deem appropriate and fair in its
discretion and that may provide for the selection of a portion or portions
(equal to twenty-five U.S. dollars ($25) or any integral multiple thereof), the
Junior Subordinated Debentures to be redeemed and shall thereafter promptly
notify the Company in writing of the numbers of the Junior Subordinated
Debentures to be redeemed, in whole or in part.

The Company may, if and whenever it shall so elect, by delivery of
instructions signed on its behalf by its President or any Vice President,
instruct the Trustee or any paying agent to call all or any part of the Junior
Subordinated Debentures for redemption and to give notice of redemption in the
manner set forth in this Section, such notice to be in the name of the Company
or in the name of the Trustee or the paying agent, as the Trustee or such paying
agent may deem advisable. In any case in which notice of redemption is to be
given by the Trustee or any such paying agent, the Company shall deliver or
cause to be delivered to, or permit to remain with, the Trustee or such paying
agent, as the case may be, such Securities Register, transfer books or other
records, or suitable copies or extracts therefrom, sufficient to enable the
Trustee or such paying agent to give any notice by mail that may be required
under the provisions of this Section.

3.5 PAYMENT UPON REDEMPTION.

(a) If the giving of notice of redemption shall have been completed as
above provided, the Junior Subordinated Debentures or portions of Junior
Subordinated Debentures to be redeemed specified in such notice shall become due
and payable on the date and at the place stated in such notice at the Redemption
Price (which includes interest accrued to the date fixed for redemption) and
interest on such Junior Subordinated Debentures or portions of Junior
Subordinated Debentures shall cease to accrue on and after the date fixed for
redemption, unless the Company shall default in the payment of such Redemption
Price with respect to any such Junior Subordinated Debenture or portion thereof.
On presentation and surrender of such Junior Subordinated Debentures on or after
the date fixed for redemption at the place of payment specified in the notice,
such Junior Subordinated Debentures shall be paid and redeemed at the Redemption
Price (which includes the interest accrued thereon to the date fixed for
redemption) (but if the date fixed for redemption is an Interest Payment Date,
the interest installment payable on such date shall be payable to the registered
Holder at the close of business on the applicable record date pursuant to
Section 2.5(a)).

(b) Upon presentation of any Junior Subordinated Debenture that is to be
redeemed in part only, the Company shall execute and the Trustee shall
authenticate and the office or agency where the Junior Subordinated Debenture is
presented shall deliver to the Holder thereof, at the expense of the Company, a
new

<PAGE>

Junior Subordinated Debenture or Junior Subordinated Debentures of authorized
denominations in principal amount equal to the unredeemed portion of the
Junior Subordinated Debenture so presented.

3.6 NO SINKING FUND. The Junior Subordinated Debentures are not entitled
to the benefit of any sinking fund.

ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD

4.1 EXTENSION OF INTEREST PAYMENT PERIOD. So long as no Event of Default
has occurred and is continuing, the Company shall have the right, at any time
and from time to time during the term of the Junior Subordinated Debentures, to
defer payments of interest by extending the interest payment period of such
Junior Subordinated Debentures for a period not exceeding 20 consecutive
quarters (the "Extended Interest Payment Period"), during which Extended
Interest Payment Period no interest shall be due and payable; provided that no
Extended Interest Payment Period may extend beyond the Maturity Date. To the
extent permitted by applicable law, interest, the payment of which has been
deferred because of the extension of the interest payment period pursuant to
this Section 4.1, will bear interest thereon at the Coupon Rate compounded
quarterly for each quarter of the Extended Interest Payment Period ("Compounded
Interest"). At the end of the Extended Interest Payment Period, the Company
shall pay all interest accrued and unpaid on the Junior Subordinated Debentures,
including any Additional Sums and Compounded Interest (together, "Deferred
Interest") that shall be payable to the Holders of the Junior Subordinated
Debentures in whose names the Subordinated Debentures are registered in the
Securities Register on the first record date after the end of the Extended
Interest Payment Period. Before the termination of any Extended Interest
Payment Period, the Company may further extend such period, provided that such
period together with all such further extensions thereof shall not exceed 20
consecutive quarters, or extend beyond the Maturity Date. Upon the termination
of any Extended Interest Payment Period and upon the payment of all Deferred
Interest then due, the Company may commence a new Extended Interest Payment
Period, subject to the foregoing requirements. No interest shall be due and
payable during an Extended Interest Payment Period, except at the end thereof,
but the Company may prepay at any time all or any portion of the interest
accrued during an Extended Interest Payment Period.

4.2 NOTICE OF EXTENSION.

(a) If the Property Trustee is the only registered Holder of the Junior
Subordinated Debentures at the time the Company selects an Extended Interest
Payment Period, the Company shall give written notice to the Administrative
Trustees, the Property Trustee and the Trustee of its selection of such Extended
Interest Payment Period one Business Day before the earlier of (i) the next
succeeding date on which Distributions are payable, or (ii) the date the Trust
is required to give notice of the record date, or the date such Distributions
are payable, to the Capital Securities holders or to the Nasdaq National Market
or other applicable self regulatory organization, if any, but in any event at
least one Business Day before such record date.

(b) If the Property Trustee is not the only Holder of the Junior
Subordinated Debentures at the time the Company selects an Extended Interest
Payment Period, the Company shall give the Holders of the Junior Subordinated
Debentures and the Trustee written notice of its selection of such Extended
Interest Payment Period at least one Business Day before the earlier of (i) the
next succeeding Interest Payment Date, or (ii) the date the Company is required
to give notice of the record or payment date of such interest payment to the
Holders of the Junior Subordinated Debentures or to the Nasdaq National Market
or other applicable self regulatory organization, if any.

<PAGE>

(c) The quarter in which any notice is given pursuant to paragraph (a) or
paragraph (b) of this Section 4.2 shall be counted as one of the 20 quarters
permitted in the maximum Extended Interest Payment Period permitted under
Section 4.1.

4.3 LIMITATION OF TRANSACTIONS DURING EXTENSION. If: (i) the Company
shall exercise its right to defer payment of interest as provided in Section
4.1; or (ii) there shall have occurred any Event of Default, then the Company
shall be subject to the restrictions on payments set forth under Section 5.6.

ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY

5.1 PAYMENT OF PRINCIPAL AND INTEREST. The Company will duly and
punctually pay or cause to be paid the principal of and interest on the Junior
Subordinated Debentures at the time and place and in the manner provided herein
and established with respect to such Junior Subordinated Debentures.

5.2 MAINTENANCE OF AGENCY. So long as any Junior Subordinated Debentures
remain Outstanding, the Company agrees to maintain an office or agency in Fargo,
North Dakota, or at such other location or locations as may be designated as
provided in this Section 5.2, where (i) Junior Subordinated Debentures may be
presented for payment, (ii) Junior Subordinated Debentures may be presented as
hereinabove authorized for registration of transfer and exchange, and (iii)
notices and demands to or upon the Company in respect of the Junior Subordinated
Debentures and this Indenture may be given or served, such designation to
continue with respect to such office or agency until the Company shall, by
written notice signed by its President or a Vice President and delivered to the
Trustee, designate some other office or agency for such purposes or any of them.
If at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
to receive all such presentations, notices and demands.

5.3 PAYING AGENTS.

(a) If the Company shall appoint one or more paying agents for the Junior
Subordinated Debentures, other than the Trustee, the Company will cause each
such paying agent to execute and deliver to the Trustee an instrument in which
such agent shall agree with the Trustee, subject to the provisions of this
Section:

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

(ii) that it will give the Trustee notice of any failure by the
Company (or by any other obligor) to make any payment of the principal of
or interest on the Junior Subordinated Debentures when the same shall be
due and payable;

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

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

<PAGE>

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

(c) Notwithstanding anything in this Section to the contrary, (i) the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Section 13.5, and (ii) the Company may at any time, for the
purpose of obtaining the satisfaction and discharge of this Indenture or for any
other purpose, pay, or direct any paying agent to pay, to the Trustee all sums
held in trust by the Company or such paying agent, such sums to be held by the
Trustee upon the same terms and conditions as those upon which such sums were
held by the Company or such paying agent; and, upon such payment by any paying
agent to the Trustee, such paying agent shall be released from all further
liability with respect to such money.

5.4 APPOINTMENT TO FILL VACANCY IN OFFICE OF TRUSTEE. The Company,
whenever necessary to avoid or fill a vacancy in the office of Trustee, will
appoint, in the manner provided in Section 9.10, a Trustee, so that there shall
at all times be a Trustee hereunder.

5.5 COMPLIANCE WITH CONSOLIDATION PROVISIONS. The Company will not, while
any of the Junior Subordinated Debentures remain Outstanding, consolidate with,
or merge into, or merge into itself, or sell or convey all or substantially all
of its property to any other company unless the provisions of Article Twelve
hereof are complied with.

5.6 RESTRICTIONS ON CERTAIN PAYMENTS. If at any time (i) there shall have
occurred any event of which the Company has actual knowledge that (a) with the
giving of notice or the lapse of time, or both, would constitute an Event of
Default and (b) in respect to which the Company shall not have taken reasonable
steps to cure, or (ii) the Company shall have given notice of its election of an
Extended Interest Payment Period as provided herein with respect to the Junior
Subordinated Debentures and shall not have rescinded such notice, or such
Extended Interest Payment Period, or any extension thereof, shall be continuing;
or (iii) while the Junior Subordinated Debentures are held by the Trust, the
Company shall be in default with respect to its payment of any obligation under
the Capital Securities Guarantee, then the Company will not (1) declare or pay
any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock or (2)
make any payment of principal, interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Company (including the Junior
Subordinated Debentures) that rank pari passu with or junior in interest to the
Junior Subordinated Debentures or make any guarantee payments with respect to
any guarantee by the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks pari passu or junior in interest to the Junior
Subordinated Debentures (other than (a) dividends or distributions in common
stock, (b) any declaration of a dividend in connection with the implementation
of a shareholders' rights plan, or the issuance of stock under any such plan in
the future or the redemption or repurchase of any such rights pursuant thereto,
(c) payments under the Capital Securities Guarantee and (d) purchases of common
stock related to the issuance of common stock or rights under any of the
Company's benefit plans for its directors, officers or employees).

5.7 COVENANTS AS TO THE TRUST. For so long as the Trust Securities of the
Trust remain outstanding, the Company will (i) maintain 100% direct or indirect
ownership of the Common Securities of the Trust;

<PAGE>

provided, however, that any permitted successor of the Company under this
Indenture may succeed to the Company's ownership of the Common Securities,
(ii) use its reasonable efforts to cause the Trust (a) to remain a business
trust, except in connection with a distribution of Securities, the redemption
of all of the Trust Securities of the Trust or certain mergers,
consolidations or amalgamations, each as permitted by the Trust Agreement,
and (b) to otherwise continue not to be treated as an association taxable as
a corporation or partnership for United States federal income tax purposes
and (iii) to use its reasonable efforts to cause each Holder of Trust
Securities to be treated as owning an individual beneficial interest in the
Securities.

If the Junior Subordinated Debentures are to be issued as a Global
Subordinated Debenture in connection with the distribution of the Junior
Subordinated Debentures to the holders of the Capital Securities issued by the
Trust upon a Dissolution Event, the Company will use its best efforts to list
such Junior Subordinated Debentures on the Nasdaq National Market or on such
other exchange as the Capital Securities may then be listed.

ARTICLE VI
SECURITYHOLDERS' LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE

6.1 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF SECURITYHOLDERS.
The Company will furnish or cause to be furnished to the Trustee (a) on a
monthly basis on each regular record date (as defined in Section 2.5(a)) a list,
in such form as the Trustee may reasonably require, of the names and addresses
of the Holders as of such regular record date, provided that the Company shall
not be obligated to furnish or cause to furnish such list at any time that the
list shall not differ in any respect from the most recent list furnished to the
Trustee by the Company and (b) at such other times as the Trustee may request in
writing within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days prior to the
time such list is furnished; provided, however, that, in either case, no such
list need be furnished if the Trustee shall be the Security Registrar.

6.2 PRESERVATION OF INFORMATION; COMMUNICATIONS WITH SECURITYHOLDERS.

(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the Holders
contained in the most recent list furnished to it as provided in Section 6.1 and
as to the names and addresses of Holders received by the Trustee in its capacity
as Security Registrar (if acting in such capacity).

(b) The Trustee may destroy any list furnished to it as provided in
Section 6.1 upon receipt of a new list so furnished.

(c) Securityholders may communicate as provided in Section 312(b) of the
Trust Indenture Act with other Securityholders with respect to their rights
under this Indenture or under the Junior Subordinated Debentures.

6.3 REPORTS BY THE COMPANY.

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

<PAGE>

accordance with the rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic information, documents and
reports that may be required pursuant to any applicable rules and regulations
of the Commission.

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

(c) The Company covenants and agrees to transmit by mail, first-class
postage prepaid, or reputable over-night delivery service that provides for
evidence of receipt, to the Securityholders, as their names and addresses appear
upon the Securities Register, within 30 days after the filing thereof with the
Trustee, such summaries of any information, documents and reports required to be
filed by the Company pursuant to subsections (a) and (b) of this Section as may
be required by rules and regulations prescribed from time to time by the
Commission.

6.4 REPORTS BY THE TRUSTEE.

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

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

(c) A copy of each such report shall, at the time of such transmission to
Securityholders, be filed by the Trustee with the Company, and also with the
Commission.

ARTICLE VII
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT

7.1 EVENTS OF DEFAULT.

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

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

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

(iii) the Company fails to observe or perform any other of its
covenants or agreements hereunder with respect to the Junior Subordinated
Debentures for a period of 90 days after the date on

<PAGE>

which written notice of such failure, requiring the same to be remedied
and stating that such notice is a "Notice of Default" hereunder, shall
have been given to the Company by the Trustee, by registered or certified
mail, or to the Company and the Trustee by the Holders of at least 25% in
principal amount of the Junior Subordinated Debentures at the time
Outstanding;

(iv) the Company pursuant to or within the meaning of any Bankruptcy
Law (1) commences a voluntary case, (2) consents to the entry of an order
for relief against it in an involuntary case, (3) consents to the
appointment of a custodian of it or for all or substantially all of its
property or (4) makes a general assignment for the benefit of its
creditors;

(v) a court of competent jurisdiction enters an order under any
Bankruptcy Law that (1) is for relief against the Company in an involuntary
case, (2) appoints a custodian of the Company for all or substantially all
of its property, or (3) orders the liquidation of the Company, and the
order or decree remains unstayed and in effect for 90 days; or

(vi) in the event Junior Subordinated Debentures are issued to the
Trust or a trustee of the Trust in connection with the issuance of Trust
Securities by the Trust, the Trust shall have voluntarily or involuntarily
dissolved, wound-up its business or otherwise terminated its existence,
except in connection with (1) the distribution of Junior Subordinated
Debentures to holders of Trust Securities in liquidation of their interests
in the Trust, (2) the redemption of all of the outstanding Trust Securities
of the Trust or (3) certain mergers, consolidations or amalgamations, each
as permitted by the Trust Agreement.

(b) In each and every such case, unless the principal of all the Junior
Subordinated Debentures shall have already become due and payable, either the
Trustee or the Holders of not less than 25% in aggregate principal amount of the
Junior Subordinated Debentures then Outstanding hereunder, by notice in writing
to the Company (and to the Trustee if given by such Securityholders) may declare
the principal of all the Junior Subordinated Debentures to be due and payable
immediately, and upon any such declaration the same shall become and shall be
immediately due and payable, notwithstanding anything contained in this
Indenture or in the Junior Subordinated Debentures to the contrary.

(c) At any time after the principal of the Junior Subordinated Debentures
shall have been so declared due and payable, and before any judgment or decree
for the payment of the moneys due shall have been obtained or entered as
hereinafter provided, the Holders of a majority in aggregate principal amount of
the Junior Subordinated Debentures then Outstanding, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if: (i) the Company has paid or deposited with the Trustee a sum
sufficient to pay all matured installments of interest upon all the Junior
Subordinated Debentures and the principal of any and all Junior Subordinated
Debentures that shall have become due otherwise than by acceleration (with
interest upon such principal and, to the extent that such payment is enforceable
under applicable law, upon overdue installments of interest, at the rate per
annum expressed in the Junior Subordinated Debentures to the date of such
payment or deposit) and the amount payable to the Trustee under Section 9.6, and
(ii) any and all Events of Default under this Indenture, other than the
nonpayment of principal on Junior Subordinated Debentures that shall not have
become due by their terms, shall have been remedied or waived as provided in
Section 7.6. Should the Holders fail to annul such declaration and waive such
default, then the holders of a majority in aggregate Liquidation Amount of the
Capital Securities shall have such right.

No such rescission and annulment shall extend to or shall affect any
subsequent default or impair any right consequent thereon.

<PAGE>

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

7.2 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.

(a) The Company covenants that (i) in case it shall default in the payment
of any installment of interest on any of the Junior Subordinated Debentures as
and when the same shall have become due and payable, and such default shall have
continued for a period of 90 Business Days, or (ii) in case it shall default in
the payment of the principal of any of the Junior Subordinated Debentures when
the same shall have become due and payable, whether upon maturity of the Junior
Subordinated Debentures or upon redemption or upon declaration or otherwise,
then, upon demand of the Trustee, the Company will pay to the Trustee, for the
benefit of the Holders of the Junior Subordinated Debentures, the whole amount
that then shall have become due and payable on all such Junior Subordinated
Debentures for principal or interest, or both, as the case may be, with interest
upon the overdue principal and (to the extent that payment of such interest is
enforceable under applicable law and, if the Junior Subordinated Debentures are
held by the Trust or a trustee of the Trust, without duplication of any other
amounts paid by the Trust or trustee in respect thereof) upon overdue
installments of interest at the rate per annum expressed in the Junior
Subordinated Debentures; and, in addition thereto, such further amount as shall
be sufficient to cover the costs and expenses of collection, and the amount
payable to the Trustee under Section 9.6.

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

(c) In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, readjustment, arrangement, composition or judicial proceedings
affecting the Company or the creditors or property of either, the Trustee shall
have power to intervene in such proceedings and take any action therein that may
be permitted by the court and shall (except as may be otherwise provided by law)
be entitled to file such proofs of claim and other papers and documents as may
be necessary or advisable in order to have the claims of the Trustee and of the
Holders of Junior Subordinated Debentures allowed for the entire amount due and
payable by the Company under this Indenture at the date of institution of such
proceedings and for any additional amount that may become due and payable by the
Company after such date, and to collect and receive any moneys or other property
payable or deliverable on any such claim, and to distribute the same after the
deduction of the amount payable to the Trustee under Section 9.6; and any
receiver, assignee or trustee in bankruptcy or reorganization is hereby
authorized by each of the Holders to make such payments to the Trustee, and, in
the event that the Trustee shall consent to the making of such payments directly
to such Securityholders, to pay to the Trustee any amount due it under Section
9.6.

(d) All rights of action and of asserting claims under this Indenture may
be enforced by the Trustee without the possession of any of the Junior
Subordinated Debentures, or the production thereof at any trial or other
proceeding relative thereto, and any such suit or proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for payment to

<PAGE>

the Trustee of any amounts due under Section 9.6, be for the ratable benefit
of the Holders of the Junior Subordinated Debentures.

In case of an Event of Default hereunder, the Trustee may in its discretion
proceed to protect and enforce the rights vested in it by this Indenture by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any of such rights, either at law or in equity or in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.

Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Junior Subordinated Debentures or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any Securityholder in
any such proceeding.

7.3 APPLICATION OF MONEYS COLLECTED. Any moneys collected by the Trustee
pursuant to this Article with respect to the Junior Subordinated Debentures
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such moneys on account of principal
or interest, upon presentation of the Junior Subordinated Debentures, and
notation thereon the payment, if only partially paid, and upon surrender thereof
if fully paid:

FIRST: To the payment of costs and expenses of collection and of all
amounts payable to the Trustee under Section 9.6;

SECOND: To the payment of all Senior and Subordinated Debt of the Company
if and to the extent required by Article Sixteen; and

THIRD: To the payment of the amounts then due and unpaid upon Junior
Subordinated Debentures for principal and 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 such Junior
Subordinated Debentures for principal and interest, respectively.

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

Notwithstanding any other provisions of this Indenture to the contrary, the
right of any Holder to receive payment of the principal of and interest on the
Junior Subordinated Debentures on or after the respective due dates (or in the
case of redemption, on the redemption date), or to institute suit for the
enforcement of any such payment on or after such respective dates or redemption
date, shall not be impaired or affected without the consent of such Holder; and
by accepting a Junior Subordinated Debenture hereunder it is expressly
understood, intended and covenanted by the Holder thereof with every other such
Holder and the Trustee, that no one or more

<PAGE>

Holders shall have any right in any manner whatsoever by virtue of or by
availing any provision of this Indenture to affect, disturb or prejudice the
rights of any other Holders, or to obtain or seek to obtain priority over or
preference to any such other Holders, or to enforce any right under this
Indenture, except in the manner herein provided and for the equal, ratable
and common benefit of all Holders of Junior Subordinated Debentures. For the
protection and enforcement of the provisions of this Section, each and every
Securityholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.

7.5 RIGHTS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT WAIVER.

(a) Except as otherwise provided in Section 7.2, all powers and remedies
given by this Article to the Trustee or to the Securityholders shall, to the
extent permitted by law, be deemed cumulative and not exclusive of any other
powers and remedies available to the Trustee or the Holders of the Junior
Subordinated Debentures, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture or otherwise established with respect to such Junior Subordinated
Debentures.

(b) No delay or omission of the Trustee or of any Holder of any of the
Junior Subordinated Debentures to exercise any right or power accruing upon any
Event of Default occurring and continuing as aforesaid shall impair any such
right or power, or shall be construed to be a waiver of any such default or on
acquiescence therein; and, subject to the provisions of Section 7.4, every power
and remedy given by this Article or by law to the Trustee or the Securityholders
may be exercised from time to time, and as often as shall be deemed expedient,
by the Trustee or by the Securityholders.

7.6 CONTROL BY SECURITYHOLDERS. The Holders of a majority in aggregate
principal amount of the Junior Subordinated Debentures at the time Outstanding,
determined in accordance with Section 10.4, shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee;
provided, however, that such direction shall not be in conflict with any rule of
law or with this Indenture. Subject to the provisions of Section 9.1, the
Trustee shall have the right to decline to follow any such direction if the
Trustee in good faith shall, by a Responsible Officer or Officers of the
Trustee, determine that the proceeding so directed would involve the Trustee in
personal liability. The Holders of a majority in aggregate principal amount of
the Junior Subordinated Debentures at the time Outstanding affected thereby,
determined in accordance with Section 10.4, may on behalf of the Holders of all
of the Junior Subordinated Debentures waive any past default in the performance
of any of the covenants contained herein and its consequences, except (i) a
default in the payment of the principal of or interest on any of the Junior
Subordinated Debentures as and when the same shall become due by its terms
otherwise than by acceleration (unless such default has been cured and a sum
sufficient to pay all matured installments of interest and principal has been
deposited with the Trustee (in accordance with Section 7.1(c)), (ii) a default
in the covenants contained in Section 5.6 or (iii) in respect of a covenant or
provision hereof which under Article Eleven cannot be modified or amended
without the consent of the Holder of each Outstanding Junior Subordinated
Debenture affected; provided, however, that if the Junior Subordinated
Debentures are held by the Trust or a Trustee of the Trust, such waiver or
modification to such waiver shall not be effective until the Holders of a
majority in Liquidation Amount of Trust Securities of the Trust shall have
consented to such waiver or modification to such waiver; provided further, that
if the consent of the Holder of each Outstanding Junior Subordinated Debentures
is required, such waiver shall not be effective until each Holder of the Trust
Securities of the Trust shall have consented to such waiver. Upon any such
waiver, the default covered thereby shall be deemed to be cured for all purposes
of this Indenture and the Company, the Trustee and the Holders of the Junior
Subordinated Debentures shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.

<PAGE>

7.7 UNDERTAKING TO PAY COSTS. All parties to this Indenture agree, and
each Holder of any Junior Subordinated Debentures by such Holder's acceptance
thereof shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken or omitted by
it as Trustee, the filing by any party litigant in such suit of an undertaking
to pay the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to any suit instituted by the Trustee, to any suit
instituted by any Securityholder, or group of Securityholders, holding more than
10% in aggregate principal amount of the Outstanding Junior Subordinated
Debentures, or to any suit instituted by any Securityholder for the enforcement
of the payment of the principal of or interest on the Junior Subordinated
Debentures on or after the due dates thereof.

ARTICLE VIII
FORM OF JUNIOR SUBORDINATED DEBENTURE AND ORIGINAL ISSUE

8.1 FORM OF JUNIOR SUBORDINATED DEBENTURE. The Junior Subordinated
Debenture and the Trustee's Certificate of Authentication to be endorsed thereon
are to be substantially in the forms contained as Exhibit A to this Indenture,
attached hereto and incorporated herein by reference.

8.2 ORIGINAL ISSUE OF JUNIOR SUBORDINATED DEBENTURES. Junior Subordinated
Debentures in the aggregate principal amount of $____________ may, upon
execution of this Indenture, be executed by the Company and delivered to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
deliver the Junior Subordinated Debentures to or upon the written order of the
Company, signed by its Chairman, its Vice Chairman, its President, any Vice
President or its Chief Financial Officer, without any further action by the
Company.

ARTICLE IX
CONCERNING THE TRUSTEE

9.1 CERTAIN DUTIES AND RESPONSIBILITIES OF THE TRUSTEE.

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

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

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

(1) the duties and obligations of the Trustee shall be

<PAGE>

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

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

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

(iii) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of not less than a majority in principal amount of
the Junior Subordinated Debentures at the time Outstanding relating to the
time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred upon
the Trustee under this Indenture; and

(iv) none of the provisions contained in this Indenture shall require
the Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if there is reasonable ground for
believing that the repayment of such funds or liability is not reasonably
assured to it under the terms of this Indenture or adequate indemnity
against such risk is not reasonably assured to it.

9.2 CERTAIN RIGHTS OF TRUSTEE. Except as otherwise provided in Section
9.1:

(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, consent, order, approval, bond, security or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties;

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

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

(d) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request, order or direction of
any of the Securityholders, pursuant to the provisions of this Indenture, unless
such Securityholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities that may be incurred
therein or thereby; nothing contained herein shall, however, relieve the Trustee
of the obligation, upon the occurrence of an Event of Default (that has not been
cured or waived) to exercise such of the rights and powers vested in it by this
Indenture, and to use the same degree of

<PAGE>

care and skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs;

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

(f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, security, or
other papers or documents, unless requested in writing so to do by the Holders
of not less than a majority in principal amount of the Outstanding Junior
Subordinated Debentures (determined as provided in Section 10.4); provided,
however, that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such costs, expenses or
liabilities as a condition to so proceeding. The reasonable expense of every
such examination shall be paid by the Company or, if paid by the Trustee, shall
be repaid by the Company upon demand; 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.

9.3 TRUSTEE NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF THE JUNIOR
SUBORDINATED DEBENTURES.

(a) The recitals contained herein and in the Junior Subordinated
Debentures shall be taken as the statements of the Company and the Trustee
assumes no responsibility for the correctness of the same.

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

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

9.4 MAY HOLD JUNIOR SUBORDINATED DEBENTURES. The Trustee or any paying
agent or Securities Registrar, in its individual or any other capacity, may
become the owner or pledgee of Junior Subordinated Debentures with the same
rights it would have if it were not Trustee, paying agent or Securities
Registrar.

9.5 MONEYS HELD IN TRUST. Subject to the provisions of Section 13.5, all
moneys received by the Trustee shall, until used or applied as herein provided,
be held in trust for the purposes for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any moneys received by it hereunder
except such as it may agree with the Company to pay thereon.

9.6 COMPENSATION AND REIMBURSEMENT.

(a) The Company covenants and agrees to pay to the Trustee, and the
Trustee shall be entitled to, such reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust), as the Company and the Trustee may from time to time agree in
writing, for all services rendered by it in the execution of the trusts hereby
created and in the exercise and performance of any

<PAGE>

of the powers and duties hereunder of the Trustee, and, except as otherwise
expressly provided herein, the Company will pay or reimburse the Trustee upon
its request for all reasonable expenses, disbursements and advances incurred
or made by the Trustee in accordance with any of the provisions of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its counsel and of all Persons not regularly in its employ)
except any such expense, disbursement or advance as may arise from its
negligence or bad faith. The Company also covenants to indemnify the Trustee
(and its officers, agents, directors and employees) for, and to hold it
harmless against, any loss, liability or expense incurred without negligence
or bad faith on the part of the Trustee and arising out of or in connection
with the acceptance or administration of this trust, including the costs and
expenses of defending itself against any claim of liability in the premises.

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

9.7 RELIANCE ON OFFICERS' CERTIFICATE. Except as otherwise provided in
Section 9.1, whenever in the administration of the provisions of this Indenture
the Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking or suffering or omitting to take any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad faith on the
part of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee and such certificate, in the
absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted to be taken by
it under the provisions of this Indenture upon the faith thereof.

9.8 DISQUALIFICATION; CONFLICTING INTERESTS. If the Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Trustee and the Company shall in all respects comply
with the provisions of Section 310(b) of the Trust Indenture Act.

9.9 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY. There shall at all times be
a Trustee with respect to the Junior Subordinated Debentures issued hereunder
which shall at all times be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or other Person permitted to act as
trustee by the Commission, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000, and
subject to supervision or examination by Federal, State, Territorial, or
District of Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. The Company may not, nor may any Person directly or
indirectly controlling, controlled by, or under common control with the Company,
serve as Trustee. In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect specified in Section 9.10.

9.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

(a) The Trustee, or any successor hereafter appointed, may at any time
resign by giving written notice thereof to the Company and by transmitting
notice of resignation by mail, first-class postage prepaid, to the
Securityholders, as their names and addresses appear upon the Securities
Register. Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee by written instrument, in duplicate, executed by
order of the Board of Directors, one copy of which instrument shall be delivered
to the resigning

<PAGE>

Trustee and one copy to the successor trustee. If no successor trustee shall
have been so appointed and have accepted appointment within 30 days after the
mailing of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor trustee,
or any Securityholder who has been a bona fide Holder of Junior Subordinated
Debentures for at least six months may, subject to the provisions of Section
7.7, on behalf of such Securityholder and all other Holders, petition any
such court for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.

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

(i) the Trustee shall fail to comply with the provisions of Section
9.8 after written request therefor by the Company or by any Securityholder
who has been a bona fide Holder of Junior Subordinated Debentures for at
least six months; or

(ii) the Trustee shall cease to be eligible in accordance with the
provisions of Section 9.9 and shall fail to resign after written request
therefor by the Company or by any such Securityholder; or

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

(c) The Holders of a majority in aggregate principal amount of the Junior
Subordinated Debentures at the time Outstanding may at any time remove the
Trustee by so notifying the Trustee and the Company and may appoint a successor
Trustee with the consent of the Company.

(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor trustee as provided in
Section 9.11.

9.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

(a) In case of the appointment hereunder of a successor trustee, every
such successor trustee so appointed shall execute, acknowledge and deliver to
the Company 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 Company 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.

<PAGE>

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

(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.

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

9.12 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 the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such corporation shall be
qualified and eligible under the provisions of this Article Nine, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding. In case any
Junior Subordinated Debentures shall have been authenticated, but not delivered,
by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication and
deliver the Junior Subordinated Debentures so authenticated with the same effect
as if such successor Trustee had itself authenticated such Junior Subordinated
Debentures.

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

9.14 APPOINTMENT OF AUTHENTICATING AGENT. At any time when any of the
Junior Subordinated Debentures remain Outstanding, the Trustee may appoint an
Authenticating Agent or Agents which shall be authorized to act on behalf of the
Trustee to authenticate Junior Subordinated Debentures issued upon original
issuance, exchange, registration of transfer or partial redemption thereof or
pursuant to Section 2.8, and Junior Subordinated Debentures so authenticated
shall be entitled to the benefits of this Indenture and shall be valid and
obligatory for all purposes as if authenticated by the Trustee hereunder.
Wherever reference is made in this Indenture to the authentication and delivery
of Junior Subordinated Debentures 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 and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to act as Authenticating Agent, having a combined capital and
surplus of not less than $10,000,000 and subject to supervision or examination
by Federal or State authority. If such Authenticating Agent publishes reports
of condition at least annually, pursuant to law or to the requirements of such
supervision or examining authority, 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.

<PAGE>

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 the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, 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 Company. 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 Company. Upon receiving such notice of
resignation or upon such 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 Company and shall mail written notice of such appointment by
first-class mail, postage prepaid, to all Securityholders as their names and
addresses appear in the Securities Register. 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 the like effect as
if originally named as an Authenticating Agent herein. No successor
Authenticating Agent shall be appointed unless eligible under the provisions 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 9.6.

If an appointment is made pursuant to this Section, the Junior Subordinated
Debentures may have endorsed thereon, in lieu of the form of certificate of
authentication set forth in Section 8.1, a certificate of authentication in the
following form:

"This is one of the Junior Subordinated Debentures described in the
within mentioned Indenture."

-------------------------------------------
As Trustee

By ----------------------------------------
As Authenticating Agent

By ----------------------------------------
Authorized Signature

ARTICLE X
CONCERNING THE SECURITYHOLDERS

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

<PAGE>

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

10.2 PROOF OF EXECUTION BY SECURITYHOLDERS. Subject to the provisions of
Section 6.1, proof of the execution of any instrument by a Securityholder (such
proof will not require notarization) or his agent or proxy and proof of the
holding by any Person of any of the Junior Subordinated Debentures shall be
sufficient if made in the following manner:

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

(b) The ownership of Junior Subordinated Debentures shall be proved by the
Securities Register or by a certificate of the Securities Registrar thereof.

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

10.4 CERTAIN JUNIOR SUBORDINATED DEBENTURES OWNED BY COMPANY DISREGARDED.
In determining whether the Holders of the requisite aggregate principal amount
of Junior Subordinated Debentures have concurred in any direction, consent or
waiver under this Indenture, the Junior Subordinated Debentures that are owned
by the Company or any other obligor on the Junior Subordinated Debentures or by
any Person directly or indirectly controlling or controlled by or under common
control with the Company or any other obligor on the Junior Subordinated
Debentures shall be disregarded and deemed not to be Outstanding for the purpose
of any such determination, except that for the purpose of determining whether
the Trustee shall be protected in relying on any such direction, consent or
waiver, only Junior Subordinated Debentures that the Trustee actually knows are
so owned shall be so disregarded. The Junior Subordinated Debentures so owned
that have been pledged in good faith may be regarded as Outstanding for the
purposes of this Section, if the pledgee shall establish to the satisfaction of
the Trustee the pledgee's right with respect to such Junior Subordinated
Debentures and that the pledgee is not a Person directly or indirectly
controlling or controlled by or under direct or indirect common

<PAGE>

control with the Company or any such other obligor. In case of a dispute as
to such right, any decision by the Trustee taken upon the advice of counsel
shall be full protection to the Trustee.

10.5 ACTIONS BINDING ON FUTURE SECURITYHOLDERS. At any time prior to (but
not after) the evidencing to the Trustee, as provided in Section 10.1, of the
taking of any action by the Holders of the majority or percentage in aggregate
principal amount of the Junior Subordinated Debentures specified in this
Indenture in connection with such action, any Holder who is shown by the
evidence to have consented to such action may, by filing written notice with the
Trustee, and upon proof of holding as provided in Section 10.2, revoke such
action so far as concerns such Holder's Junior Subordinated Debentures. Except
as aforesaid any such action taken by the Holder shall be conclusive and binding
upon such Holder and upon all future Holders and owners of such Holder's Junior
Subordinated Debentures, and of any Junior Subordinated Debentures issued in
exchange therefor, on registration of transfer thereof or in place thereof,
irrespective of whether or not any notation in regard thereto is made upon such
Junior Subordinated Debentures. Any action taken by the Holders of the majority
or percentage in aggregate principal amount of the Junior Subordinated
Debentures specified in this Indenture in connection with such action shall be
conclusively binding upon the Company, the Trustee and the Holders of all the
Junior Subordinated Debentures.

ARTICLE XI
SUPPLEMENTAL INDENTURES

11.1 SUPPLEMENTAL INDENTURES WITHOUT THE CONSENT OF SECURITYHOLDERS. In
addition to any supplemental indenture otherwise authorized by this Indenture,
the Company and the Trustee may from time to time and at any time enter into an
indenture or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as then in effect), without the consent of
the Securityholders, for one or more of the following purposes:

(a) to cure any ambiguity, defect, or inconsistency herein, or in the
Junior Subordinated Debentures, provided that any such action does not
materially adversely affect the interests of the Holders or the holders of the
Capital Securities so long as they remain outstanding;

(b) to comply with Article Twelve;

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

(d) to add to the covenants of the Company for the benefit of the Holders
or to surrender any right or power herein conferred upon the Company;

(e) to add to, delete from, or revise the conditions, limitations, and
restrictions on the authorized amount, terms, or purposes of issue,
authentication, and delivery of Junior Subordinated Debentures, as herein set
forth;

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

(g) to establish the form of any certifications required to be furnished
pursuant to the terms of this Indenture or to add to the rights of the Holders.

<PAGE>

The Trustee is hereby authorized to join with the Company in the execution
of any such supplemental indenture, and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee shall
not be obligated to enter into any such supplemental indenture that affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.

Any supplemental indenture authorized by the provisions of this Section may
be executed by the Company and the Trustee without the consent of the Holders of
any of the Junior Subordinated Debentures at the time Outstanding,
notwithstanding any of the provisions of Section 11.2.

11.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF SECURITYHOLDERS. With the
consent (evidenced as provided in Section 10.1) of the Holders of not less than
a majority in aggregate principal amount of the Junior Subordinated Debentures
at the time Outstanding, the Company, when authorized by Board Resolutions, and
the Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as then in effect) for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Indenture or of any supplemental indenture or of modifying in any manner not
covered by Section 11.1 the rights of the Holders of the Junior Subordinated
Debentures under this Indenture; provided, however, that no such supplemental
indenture shall without the consent of the Holders of each Junior Subordinated
Debenture then Outstanding, (i) change the stated maturity of the Junior
Subordinated Debentures, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon, or (ii) reduce the
percentage of principal amount of Junior Subordinated Debentures, the Holders of
which are required to consent to any such supplemental indenture; provided,
further, that if the Junior Subordinated Debentures are held by the Trust or a
trustee of the Trust, such supplemental indenture shall not be effective until
the holders of a majority in aggregate Liquidation Amount of Capital Securities
shall have consented to such supplemental indenture; provided further, that if
the consent of the Holder of each Outstanding Junior Subordinated Debenture is
required, such supplemental indenture shall not be effective until each Holder
of the Trust Securities shall have consented to such supplemental indenture.

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

11.3 EFFECT OF SUPPLEMENTAL INDENTURES. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article or of Section
12.1, this Indenture shall be and be deemed to be modified and amended in
accordance therewith.

11.4 JUNIOR SUBORDINATED DEBENTURES AFFECTED BY SUPPLEMENTAL INDENTURES.
Junior Subordinated Debentures, affected by a supplemental indenture,
authenticated and delivered after the execution of such supplemental indenture
pursuant to the provisions of this Article or of Section 12.1, may bear a
notation in form approved by the Company, as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new Junior
Subordinated Debentures so modified as to conform, in the opinion of the Board
of Directors, to any modification of this Indenture contained in any such
supplemental indenture may be prepared by the Company, authenticated by the
Trustee and delivered in exchange for the Junior Subordinated Debentures then
Outstanding.

11.5 EXECUTION OF SUPPLEMENTAL INDENTURES. Upon the request of the
Company, accompanied by Board Resolutions authorizing the execution of any such
supplemental indenture, and upon the filing with the Trustee of evidence of the
consent of Securityholders required to consent thereto as aforesaid, the Trustee
shall join with the Company in the execution of such supplemental indenture
unless such supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion but shall not be obligated to enter into such supplemental
indenture. The Trustee, subject to the provisions of Section 9.1, may receive
an Opinion of Counsel as conclusive evidence that any supplemental

<PAGE>

indenture executed pursuant to this Article is authorized or permitted by,
and conforms to, the terms of this Article and that it is proper for the
Trustee under the provisions of this Article to join in the execution thereof.

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

ARTICLE XII
SUCCESSOR CORPORATION

12.1 COMPANY MAY CONSOLIDATE, ETC. The Company shall not 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 Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless (i) in
case the Company consolidates with or merges into another Person or conveys or
transfers its properties and assets substantially as an entirety to any Person,
the successor Person is organized under the laws of the United States or any
state or the District of Columbia, and such successor Person expressly assumes
the Company's obligations on the Junior Subordinated Debentures issued under
this Indenture; (ii) immediately after giving effect thereto, no Event of
Default, and no event which, after notice or lapse of time or both, would become
an Event of Default, shall have occurred and be continuing; and (iii) such
successor Person expressly assumes the due and punctual performance and
observance of all the covenants and conditions of this Indenture to be kept and
performed by the Company by executing and delivering a supplemental indenture in
form and substance satisfactory to the Trustee.

12.2 SUCCESSOR SUBSTITUTED.

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

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

12.3 EVIDENCE OF CONSOLIDATION, ETC., TO TRUSTEE. The Trustee, subject to
the provisions of Section 9.1, may receive an Opinion of Counsel as conclusive
evidence that any such consolidation, merger, sale, conveyance, transfer or
other disposition, and any such assumption, comply with the provisions of this
Article.

ARTICLE XIII
SATISFACTION AND DISCHARGE

<PAGE>

13.1 SATISFACTION AND DISCHARGE OF INDENTURE. If at any time: (a) the
Company shall have delivered to the Trustee for cancellation all Junior
Subordinated Debentures theretofore authenticated (other than any Junior
Subordinated Debentures that shall have been destroyed, lost or stolen and that
shall have been replaced or paid as provided in Section 2.8) and Junior
Subordinated Debentures for whose payment money or Governmental Obligations have
theretofore been deposited in trust or segregated and held in trust by the
Company (and thereupon repaid to the Company or discharged from such trust, as
provided in Section 13.5); or (b) all such Junior Subordinated Debentures not
theretofore delivered to the Trustee for cancellation shall have become due and
payable, or are by their terms to become due and payable within one year or are
to be called for redemption within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption, and the Company shall
deposit or cause to be deposited with the Trustee as trust funds the entire
amount in moneys or Governmental Obligations sufficient or a combination thereof
sufficient, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, to pay at maturity or upon redemption all Junior Subordinated
Debentures not theretofore delivered to the Trustee for cancellation, including
principal and interest due or to become due to such date of maturity or date
fixed for redemption, as the case may be, and if the Company shall also pay or
cause to be paid all other sums payable hereunder by the Company; then this
Indenture shall thereupon cease to be of further effect except for the
provisions of Sections 2.2, 2.3, 2.4, 2.5, 4.1, 4.2, 4.3 and 9.10, that shall
survive until the date of maturity or redemption date, as the case may be, and
Sections 9.6 and 13.5, that shall survive to such date and thereafter, and the
Trustee, on demand of the Company and at the cost and expense of the Company,
shall execute proper instruments acknowledging satisfaction of and discharging
this Indenture.

13.2 DISCHARGE OF OBLIGATIONS. If at any time all such Junior Subordinated
Debentures not theretofore delivered to the Trustee for cancellation or that
have not become due and payable as described in Section 13.1 shall have been
paid by the Company by depositing irrevocably with the Trustee as trust funds
moneys or an amount of Governmental Obligations sufficient to pay at maturity or
upon redemption all such Junior Subordinated Debentures not theretofore
delivered to the Trustee for cancellation, including principal and interest due
or to become due to such date of maturity or date fixed for redemption, as the
case may be, and if the Company shall also pay or cause to be paid all other
sums payable hereunder by the Company, then after the date such moneys or
Governmental Obligations, as the case may be, are deposited with the Trustee the
obligations of the Company under this Indenture shall cease to be of further
effect except for the provisions of Sections 2.2, 2.3, 2.4, 2.5, 4.1, 4.2, 4.3,
9.6, 9.10 and 13.5 hereof that shall survive until such Junior Subordinated
Debentures shall mature and be paid. Thereafter, Sections 9.6 and 13.5 shall
survive.

13.3 DEPOSITED MONEYS TO BE HELD IN TRUST. All monies or Governmental
Obligations deposited with the Trustee pursuant to Sections 13.1 or 13.2 shall
be held in trust and shall be available for payment as due, either directly or
through any paying agent (including the Company acting as its own paying agent),
to the Holders of the Junior Subordinated Debentures for the payment or
redemption of which such moneys or Governmental Obligations have been deposited
with the Trustee.

13.4 PAYMENT OF MONIES HELD BY PAYING AGENTS. In connection with the
satisfaction and discharge of this Indenture all moneys or Governmental
Obligations then held by any paying agent under the provisions of this Indenture
shall, upon demand of the Company, be paid to the Trustee and thereupon such
paying agent shall be released from all further liability with respect to such
moneys or Governmental Obligations.

13.5 REPAYMENT TO COMPANY. Any monies or Governmental Obligations
deposited with any paying agent or the Trustee, or then held by the Company in
trust for payment of principal of or interest on the Junior Subordinated
Debentures that are not applied but remain unclaimed by the Holders of such
Junior Subordinated Debentures for at least two years after the date upon which
the principal of or interest on such Junior Subordinated Debentures shall have
respectively become due and payable, shall be repaid to the Company on
____________ of each year or (if then held by the Company) shall be discharged
from such trust; and thereupon

<PAGE>

the paying agent and the Trustee shall be released from all further liability
with respect to such moneys or Governmental Obligations, and the Holder of
any of the Junior Subordinated Debentures entitled to receive such payment
shall thereafter, as an unsecured general creditor, look only to the Company
for the payment thereof.

ARTICLE XIV
IMMUNITY OF INCORPORATORS,
STOCKHOLDERS, OFFICERS AND DIRECTORS

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

ARTICLE XV
MISCELLANEOUS PROVISIONS

15.1 EFFECT ON SUCCESSORS AND ASSIGNS. All the covenants, stipulations,
promises and agreements in this Indenture contained by or on behalf of the
Company or the Trustee shall bind their respective successors and assigns,
whether so expressed or not.

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

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

15.4 NOTICES. Except as otherwise expressly provided herein any notice or
demand that by any provision of this Indenture is required or permitted to be
given or served by the Trustee or by the Holders of Junior Subordinated
Debentures to or on the Company may be given or served by being deposited
first-class postage prepaid in a post-office letterbox addressed (until another
address is filed in writing by the Company with the Trustee), as follows: c/o
Community First Bankshares, Inc., 520 Main Avenue, Fargo, North Dakota, 58124,

<PAGE>

Attention Chief Financial Officer. Any notice, election, request or demand
by the Company or any Securityholder to or upon the Trustee shall be deemed
to have been sufficiently given or made, for all purposes, if given or made
in writing at the Corporate Trust Office of the Trustee.

15.5 GOVERNING LAW. This Indenture and each Junior Subordinated Debenture
shall be deemed to be a contract made under the internal laws of the State of
Minnesota and for all purposes shall be construed in accordance with the laws of
said State, provided that the immunities and the standard of care of the
Trustee shall be governed by Delaware law.

15.6 TREATMENT OF JUNIOR SUBORDINATED DEBENTURES AS DEBT. It is intended
that the Junior Subordinated Debentures will be treated as indebtedness and not
as equity for federal income tax purposes. The provisions of this Indenture
shall be interpreted to further this intention.

15.7 COMPLIANCE CERTIFICATES AND OPINIONS.

(a) Upon any application or demand by the Company to the Trustee to take
any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent provided for in this Indenture relating to the proposed action have
been complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent have been complied with, except that in
the case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Indenture relating
to such particular application or demand, no additional certificate or opinion
need be furnished.

(b) Every certificate or opinion delivered to the Trustee with respect to
compliance with a condition or covenant in this Indenture shall include (1) a
statement that the Person making such certificate or opinion has read such
covenant or condition; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based; (3) a statement that, in the opinion of
such Person, such Person has made such examination or investigation as is
necessary to enable such Person to express an informed opinion as to whether or
not such covenant or condition has been complied with; and (4) a statement as to
whether or not, in the opinion of such Person, such condition or covenant has
been complied with.

15.8 PAYMENTS ON BUSINESS DAYS. In any case where the date of maturity of
interest or principal of the Junior Subordinated Debentures or the date of
redemption of the Junior Subordinated Debentures shall not be a Business Day,
then payment of interest or principal will be made on the next succeeding
Business Day (without any additional interest or other payment in respect of any
such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date such
payment was originally payable.

15.9 CONFLICT WITH TRUST INDENTURE ACT. If and to the extent that any
provision of this Indenture limits, qualifies or conflicts with the duties
imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.

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

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

<PAGE>

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

15.13 ACKNOWLEDGMENT OF RIGHTS. The Company acknowledges that, with
respect to any Junior Subordinated Debentures held by the Trust or a trustee of
the Trust, if the Property Trustee of the Trust fails to enforce its rights
under this Indenture as the Holder of the Junior Subordinated Debentures held as
the assets of the Trust, any holder of Capital Securities may institute legal
proceedings directly against the Company to enforce such Property Trustee's
rights under this Indenture without first instituting any legal proceedings
against such Property Trustee or any other person or entity. Notwithstanding
the foregoing, if an Event of Default has occurred and is continuing and such
event is attributable to the failure of the Company to pay interest or principal
on the Junior Subordinated Debentures on the date such interest or principal is
otherwise payable (or in the case of redemption, on the redemption date), the
Company acknowledges that a holder of Capital Securities may directly institute
a proceeding for enforcement of payment to such holder of the principal of or
interest on the Junior Subordinated Debentures having a principal amount equal
to the aggregate Liquidation Amount of the Capital Securities of such holder on
or after the respective due date specified in the Junior Subordinated
Debentures. This Section 15.13 may not be amended without the prior written
consent of the holders of all of the Capital Securities.

ARTICLE XVI
SUBORDINATION OF JUNIOR SUBORDINATED DEBENTURES

16.1 AGREEMENT TO SUBORDINATE. The Company covenants and agrees, and each
Holder of Junior Subordinated Debentures issued hereunder by such Holder's
acceptance thereof likewise covenants and agrees, that all Junior Subordinated
Debentures shall be issued subject to the provisions of this Article Sixteen;
and each Holder, whether upon original issue or upon transfer or assignment
thereof, accepts and agrees to be bound by such provisions.

The payment by the Company of the principal of and interest on all Junior
Subordinated Debentures issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and junior in right of payment to the
prior payment in full of all Senior and Subordinated Debt, whether outstanding
at the date of this Indenture or thereafter incurred.

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

16.2 DEFAULT ON SENIOR AND SUBORDINATED DEBT. In the event and during the
continuation of any default by the Company in the payment of principal, premium,
interest or any other payment due on any Senior and Subordinated Debt of the
Company or in the event that the maturity of any Senior and Subordinated Debt of
the Company has been accelerated because of a default, then, in either case, no
payment shall be made by the Company with respect to the principal of or
interest on the Junior Subordinated Debentures.

In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraph of this Section 16.2, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior and
Subordinated Debt or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior and
Subordinated Debt may have been issued, as their respective interests may
appear, but only to the extent that

<PAGE>

the holders of the Senior and Subordinated Debt (or their representative or
representatives or a trustee) notify the Trustee in writing within 90 days of
such payment of the amounts then due and owing on the Senior and Subordinated
Debt and only the amounts specified in such notice to the Trustee shall be
paid to the holders of Senior and Subordinated Debt.

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

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

For purposes of this Article Sixteen, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article Sixteen with
respect to the Junior Subordinated Debentures to the payment of all Senior and
Subordinated Debt of the Company, as the case may be, that may at the time be
outstanding, provided that (i) such Senior and Subordinated Debt is assumed by
the new corporation, if any, resulting from any such reorganization or
readjustment, and (ii) the rights of the holders of such Senior and Subordinated
Debt are not, without the consent of such holders, altered by such
reorganization or readjustment. The consolidation of the Company with, or the
merger of the Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer of its property
as an entirety, or substantially as an entirety, to another corporation upon the
terms and conditions provided for in Article Twelve of this Indenture shall not
be deemed a dissolution, winding-up, liquidation or reorganization for the
purposes of this Section 16.3 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer,

<PAGE>

comply with the conditions stated in Article Twelve of this Indenture.
Nothing in Section 16.2 or in this Section 16.3 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 9.6 of this Indenture.

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

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

Upon any payment or distribution of assets of the Company referred to in
this Article Sixteen, the Trustee, subject to the provisions of Section 9.1, and
the Holders of the Junior Subordinated Debentures shall be entitled to
conclusively rely upon any order or decree made by any court of competent
jurisdiction in which such dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidation trustee, agent or other Person making such
payment or distribution, delivered to the Trustee or to the Holders of the
Junior Subordinated Debentures, for the purposes of ascertaining the Persons
entitled to participate in such distribution, the holders of Senior and
Subordinated Debt and other indebtedness of the Company, 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 Sixteen.

16.5 TRUSTEE TO EFFECTUATE SUBORDINATION. Each Holder of Junior
Subordinated Debentures by such Holder's acceptance thereof authorizes and
directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article Sixteen and appoints the Trustee such Holder's attorney-in-fact for any
and all such purposes.

16.6 NOTICE BY THE COMPANY. The Company shall give prompt written notice
to a Responsible Officer of the Trustee of any fact known to the Company that
would prohibit the making of any payment of monies to or by the Trustee in
respect of the Junior Subordinated Debentures pursuant to the provisions of this

<PAGE>

Article Sixteen. Notwithstanding the provisions of this Article Sixteen 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 of monies to or by the Trustee in respect of the Junior Subordinated
Debentures pursuant to the provisions of this Article Sixteen, unless and
until a Responsible Officer of the Trustee shall have received written notice
thereof from the Company or a holder or holders of Senior and Subordinated
Debt or from any trustee therefor; and before the receipt of any such written
notice, the Trustee, subject to the provisions of Section 9.1, shall be
entitled in all respects to assume that no such facts exist; provided,
however, that if the Trustee shall not have received the notice provided for
in this Section 16.6 at least two Business Days prior to the date upon which
by the terms hereof any money may become payable for any purpose (including,
without limitation, the payment of the principal of or interest on any Junior
Subordinated Debenture), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such money and to apply the same to the purposes for which they were
received, and shall not be affected by any notice to the contrary that may be
received by it within two Business Days prior to such date.

The Trustee, subject to the provisions of Section 9.1, shall be entitled to
conclusively rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior and Subordinated Debt of the
Company (or a trustee on behalf of such holder), to establish that such notice
has been given by a holder of such Senior and Subordinated Debt or a trustee on
behalf of any such holder or holders. In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of any
Person as a holder of such Senior and Subordinated Debt to participate in any
payment or distribution pursuant to this Article Sixteen, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Senior and Subordinated Debt 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 Sixteen, 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.

16.7 RIGHTS OF THE TRUSTEE; HOLDERS OF SENIOR AND SUBORDINATED DEBT. The
Trustee in its individual capacity shall be entitled to all the rights set forth
in this Article Sixteen in respect of any Senior and Subordinated Debt at any
time held by it, to the same extent as any other holder of Senior and
Subordinated Debt, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.

With respect to the holders of Senior and Subordinated Debt of the Company,
the Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article Sixteen, and no
implied covenants or obligations with respect to the holders of such Senior and
Subordinated Debt shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of such
Senior and Subordinated Debt and, subject to the provisions of Section 9.1, the
Trustee shall not be liable to any holder of such Senior and Subordinated Debt
if it shall pay over or deliver to Holders of Junior Subordinated Debentures,
the Company or any other Person money or assets to which any holder of such
Senior and Subordinated Debt shall be entitled by virtue of this Article Sixteen
or otherwise.

16.8 SUBORDINATION MAY NOT BE IMPAIRED. No right of any present or future
holder of any Senior and Subordinated Debt of the Company 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 Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or otherwise
be charged with.

Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior and Subordinated Debt of the Company may, at any time and from
time to time, without the consent of or notice to the Trustee or the Holders of
the Junior Subordinated Debentures, without incurring responsibility to the
Holders

<PAGE>

of the Junior Subordinated Debentures and without impairing or releasing the
subordination provided in this Article Sixteen or the obligations hereunder
of the Holders of the Junior Subordinated Debentures to the holders of such
Senior and Subordinated Debt, do any one or more of the following: (i)
change the manner, place or terms of payment or extend the time of payment
of, or renew or alter, such Senior and Subordinated Debt, or otherwise amend
or supplement in any manner such Senior and Subordinated Debt or any
instrument evidencing the same or any agreement under which such Senior and
Subordinated Debt is outstanding; (ii) sell, exchange, release or otherwise
deal with any property pledged, mortgaged or otherwise securing such Senior
and Subordinated Debt; (iii) release any Person liable in any manner for the
collection of such Senior and Subordinated Debt; and (iv) exercise or refrain
from exercising any rights against the Company and any other Person.

<PAGE>

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

COMMUNITY FIRST BANKSHARES, INC.

By: ______________________________________________
Name: Donald R. Mengedoth
Title: President and Chief Executive Officer

WILMINGTON TRUST COMPANY,
AS TRUSTEE

By: _____________________________________________
Name: ___________________________________________
Title: __________________________________________

STATE OF MINNESOTA )
) ss:
COUNTY OF HENNEPIN )

On the _______ day of ____________, 1997, before me personally came Donald
R. Mengedoth, to me known, who, being by me duly sworn, did depose and say that
he is the President and Chief Executive Officer of COMMUNITY FIRST BANKSHARES,
INC., one of the corporations described in and which executed the above
instrument; and that he signed his name thereto on behalf of said corporation by
authority of the Board of Directors of said corporation.

__________________________________________________
Notary Public

STATE OF DELAWARE )
) ss:
COUNTY OF _________ )

On the _______ day of___________, 1997, before me personally came
______________________, to me known, who, being by me duly sworn, did depose and
say that he/she is the _______________________ of WILMINGTON TRUST COMPANY, one
of the corporations described in and which executed the above instrument; and
that he/she signed his/her name thereto on behalf of said corporation by
authority of the Board of Directors of said corporation.

__________________________________________________
Notary Public

<PAGE>

EXHIBIT A

(FORM OF FACE OF JUNIOR SUBORDINATED DEBENTURE)

This Junior Subordinated Debenture is a Global Subordinated Debenture
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 Junior
Subordinated Debenture is exchangeable for Junior Subordinated Debentures
registered in the name of a person other than the Depositary or its nominee
only in the limited circumstances described in the Indenture, and no transfer
of this Junior Subordinated Debenture (other than a transfer of this Junior
Subordinated Debenture 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) may be registered except in such limited
circumstances.

Unless this Junior Subordinated Debenture is presented by an authorized
representative of Wilmington Trust Company (Rodney Square North, 1100 North
Market Street, Wilmington, Delaware 19890-0001) to the issuer or its agent
for registration of transfer, exchange or payment, and any Junior
Subordinated Debenture issued is registered in the name of Cede & Co. or such
other name as requested by an authorized representative of Wilmington Trust
Company (and any payment hereon is made to Cede & Co. or to such other entity
as is requested by an authorized representative of Wilmington Trust Company),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch the registered owner hereof, Cede & Co., has an
interest herein.

Registered Principal Amount:

Registered No. _______________________ $_______________________________

CUSIP No.______________________________

<PAGE>

COMMUNITY FIRST BANKSHARES, INC.

___% JUNIOR SUBORDINATED DEBENTURE
DUE JANUARY 15, 2027

Community First Bankshares, Inc., a Delaware corporation (the "Company",
which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to ______________ or
registered assigns, the principal sum of _____________ Dollars ($___________)
on ____________, 2027 (which date may be extended as provided in the
Indenture, the "Stated Maturity"), and to pay interest on said principal sum
from ___________, 1997, or from the most recent interest payment date (each
such date, an "Interest Payment Date") to which interest has been paid or
duly provided for, quarterly (subject to deferral as set forth herein) in
arrears on the 15th day of April, July, October, and January in each year
commencing April 15, 1997, at the rate of ___% per annum until the principal
hereof shall have become due and payable, and on any overdue principal and
(without duplication and to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at
the same rate per annum compounded quarterly. The amount of each interest
payment due with respect to the Junior Subordinated Debentures will include
amounts accrued through the date the interest payment is due. The amount of
interest payable on any Interest Payment Date shall be computed on the basis
of a 360-day year of twelve 30-day months. In the event that any date on
which interest is payable on this Junior Subordinated Debenture is not a
business day, then payment of interest payable on such date will 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), except that, if such business
day is in the next succeeding calendar year, such payment shall be made on
the immediately preceding business day, in each case with the same force and
effect as if made on such date. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the person in whose name this Junior
Subordinated Debenture (or one or more Predecessor Securities, as defined in
the Indenture) is registered at the close of business on the regular record
date for such interest installment, which shall be the close of business on
the business day next preceding such Interest Payment Date unless otherwise
provided in the Indenture. The principal of and the interest on this Junior
Subordinated Debenture shall be payable at the office or agency of the
Trustee (as defined in the Indenture) maintained for that purpose in any coin
or currency of the United States of America that at the time of payment is
legal tender for payment of public and private debts; provided, however, that
payment of interest may be made at the option of the Company by check mailed
to the registered Holder (as defined in the Indenture) at such address as
shall appear in the Securities Register (as defined in the Indenture).
Notwithstanding the foregoing, so long as the Holder of this Junior
Subordinated Debenture is the Property Trustee (as defined in the Indenture),
the payment of the principal of and interest on this Junior Subordinated
Debenture will be made at such place and to such account as may be designated
by the Property Trustee.

The Stated Maturity may be shortened at any time by the Company to any date
not earlier than ____________, 2002, subject to the Company having received
prior approval of the Federal Reserve (as defined in the Indenture) if then
required under applicable capital guidelines or policies of the Federal Reserve.

The indebtedness evidenced by this Junior Subordinated Debenture is, to the
extent provided in the Indenture, subordinate and junior in right of payment to
the prior payment in full of all Senior and Subordinated Debt (as defined in the
Indenture), and this Junior Subordinated Debenture is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Junior
Subordinated Debenture, 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 action as may be necessary or appropriate to acknowledge or
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, hereby waives all notice of the acceptance of the
subordination provisions contained

<PAGE>

herein and in the Indenture by each holder of Senior and Subordinated Debt,
whether now outstanding or hereafter incurred, and waives reliance by each
such holder upon said provisions.

This Junior Subordinated Debenture shall not be entitled to any benefit
under the Indenture, be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf of
the Trustee.

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

IN WITNESS WHEREOF, the Company has caused this instrument to be executed.

Dated: _____________________ COMMUNITY FIRST BANKSHARES, INC.

By: _____________________________________________
Name: Donald R. Mengedoth
Title: President and Chief Executive Officer

Attest: By: _____________________________________________
Name:
Title: Secretary

<PAGE>

[FORM OF CERTIFICATE OF AUTHENTICATION]

CERTIFICATE OF AUTHENTICATION

This is one of the Junior Subordinated Debentures described in the
within-mentioned Indenture.

Dated:_________________________ WILMINGTON TRUST COMPANY, as Trustee

By: _____________________________________________
Authorized Signature

<PAGE>

[FORM OF REVERSE OF JUNIOR SUBORDINATED DEBENTURE]

_____% JUNIOR SUBORDINATED DEBENTURE
(CONTINUED)

This Junior Subordinated Debenture is one of the junior subordinated
debentures of the Company (herein sometimes referred to as the "Junior
Subordinated Debentures"), specified in the Indenture, all issued under and
pursuant to a Subordinated Indenture dated as of ____________, 1997 (the
"Indenture") duly executed and delivered between the Company and Wilmington
Trust Company, as Trustee (the "Trustee"), to which Indenture reference is
hereby made for a description of the rights, limitations of rights, obligations,
duties and immunities thereunder of the Trustee, the Company and the Holders of
the Junior Subordinated Debentures. The Junior Subordinated Debentures are
limited in aggregate principal amount as specified in the Indenture.

Because of the occurrence and continuation of a Special Event (as defined
in the Indenture), in certain circumstances, this Junior Subordinated Debenture
may become due and payable at the option of the Company at the principal amount
together with any interest accrued thereon (the "Redemption Price"). The
Redemption Price shall be paid prior to 2:00 p.m. Fargo Time on the date of such
redemption or at such earlier time as the Company determines.

The Company shall have the right to redeem this Junior Subordinated
Debenture at the option of the Company, in whole or in part, from time to time,
on or after ____________, 2002, at a redemption price equal to 100% of the
principal amount to be redeemed plus any accrued but unpaid interest thereon to
the date of such redemption. Any redemption pursuant to this paragraph will be
made upon not less than 30 days nor more than 60 days notice. If the Junior
Subordinated Debentures are only partially redeemed by the Company pursuant to
this paragraph, the Junior Subordinated Debentures will be redeemed pro rata or
by lot or by any other method utilized by the Trustee; provided that if, at the
time of redemption, the Junior Subordinated Debentures are registered as a
Global Subordinated Debenture (as defined in the Indenture), the Depositary (as
defined in the Indenture) shall determine the principal amount of such Junior
Subordinated Debentures held by each Junior Subordinated Debenture Holder to be
redeemed in accordance with its procedures.

In the event of redemption of this Junior Subordinated Debenture in part
only, a new Junior Subordinated Debenture for the unredeemed portion hereof will
be issued in the name of the Holder hereof upon the cancellation hereof.

In case an Event of Default (as defined in the Indenture), shall have
occurred and be continuing, the principal of all of the Junior Subordinated
Debentures may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions provided
in the Indenture.

The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the Holders of not less than a majority in aggregate
principal amount of the Junior Subordinated Debentures at the time Outstanding,
as defined in the Indenture, to execute supplemental indentures for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or of modifying in
any manner the rights of the Holders of the Junior Subordinated Debentures;
provided, however, that no such supplemental indenture shall (i) extend the
fixed maturity of the Junior Subordinated Debentures except as provided in the
Indenture, or reduce the principal amount thereof, or reduce the rate or extend
the time of payment of interest thereon, without the consent of the Holder of
each Junior Subordinated Debenture so affected, or (ii) reduce the aforesaid
percentage of Junior Subordinated Debentures, the Holders of which are required
to consent to any such supplemental indenture, without the consent of the
Holders of each Junior Subordinated Debenture then Outstanding and affected
thereby. The Indenture also contains provisions permitting the Holders of a
majority in aggregate principal amount of the Junior Subordinated

<PAGE>

Debentures at the time Outstanding, on behalf of all of the Holders of the
Junior Subordinated Debentures, to waive any past default in the performance
of any of the covenants contained in the Indenture, or established pursuant
to the Indenture, and its consequences, except a default in the payment of
the principal of or interest on any of the Junior Subordinated Debentures.
Any such consent or waiver by the registered Holder of this Junior
Subordinated Debenture (unless revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future Holders and
owners of this Junior Subordinated Debenture and of any Junior Subordinated
Debenture issued in exchange herefor or in place hereof (whether by
registration of transfer or otherwise), irrespective of whether or not any
notation of such consent or waiver is made upon this Junior Subordinated
Debenture.

No reference herein to the Indenture and no provision of this Junior
Subordinated Debenture or of the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the principal of and
interest on this Junior Subordinated Debenture at the time and place and at the
rate and in the money herein prescribed.

The Company shall have the right at any time during the term of the
Junior Subordinated Debentures and from time to time to extend the interest
payment period of such Junior Subordinated Debentures for up to 20
consecutive quarters (an "Extended Interest Payment Period"), at the end of
which period the Company shall pay all interest then accrued and unpaid
(together with interest thereon at the rate specified for the Junior
Subordinated Debentures to the extent that payment of such interest is
enforceable under applicable law). Before the termination of any such
Extended Interest Payment Period, the Company may further extend such
Extended Interest Payment Period, provided that such Extended Interest
Payment Period together with all such further extensions thereof shall not
exceed 20 consecutive quarters or extend beyond the Stated Maturity. At the
termination of any such Extended Interest Payment Period and upon the payment
of all accrued and unpaid interest and any additional amounts then due, the
Company may commence a new Extended Interest Payment Period.

As provided in the Indenture and subject to certain limitations therein set
forth, this Junior Subordinated Debenture is transferable by the registered
Holder hereof on the Securities Register of the Company, upon surrender of this
Junior Subordinated Debenture for registration of transfer at the office or
agency of the Trustee accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company or the Trustee duly executed by the
registered Holder hereof or such Holder's attorney duly authorized in writing,
and thereupon one or more new Junior Subordinated Debentures of authorized
denominations and for the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be made for any
such transfer, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in relation thereto.

Prior to due presentment for registration of transfer of this Junior
Subordinated Debenture, the Company, the Trustee, any paying agent and the
Securities Registrar (as defined in the Indenture) may deem and treat the
registered holder hereof as the absolute owner hereof (whether or not this
Junior Subordinated Debenture shall be overdue and notwithstanding any notice
of ownership or writing hereon made by anyone other than the Securities
Registrar) for the purpose of receiving payment of or on account of the
principal hereof and interest due hereon and for all other purposes, and
neither the Company nor the Trustee nor any paying agent nor any Securities
Registrar shall be affected by any notice to the contrary.

No recourse shall be had for the payment of the principal of or the
interest on this Junior Subordinated Debenture, or for any claim based hereon,
or otherwise in respect hereof, or based on or in respect of the Indenture,
against any incorporator, stockholder, officer or director, past, present or
future, as such, of the Company or of any predecessor or successor corporation,
whether by virtue of any constitution, statute or rule

<PAGE>

of law, or by the enforcement of any assessment or penalty or otherwise, all
such liability being, by the acceptance hereof and as part of the
consideration for the issuance hereof, expressly waived and released.

The Junior Subordinated Debentures are issuable only in registered form
without coupons in denominations of $25 and any integral multiple thereof.
This Global Subordinated Debenture is exchangeable for Junior Subordinated
Debentures in definitive form only under certain limited circumstances set
forth in the Indenture. Junior Subordinated Debentures so issued are
issuable only in registered form without coupons in denominations of $25 and
any integral multiple thereof.

<PAGE>

[LETTERHEAD]

Exhibit 8.1

January 30, 1997

Community First Bankshares, Inc. CFB Capital I
520 Main Avenue c/o Community First Bankshares, Inc.
Fargo, North Dakota 58124-0001 520 Main Avenue
Fargo, North Dakota 58124-0001

RE: Opinion of Counsel Related to the Material Federal Income Tax
Consequences of the Purchase and Ownership of Capital Securities
Issued by CFB Capital

Ladies and Gentlemen:

We have acted as counsel to Community First Bankshares, Inc. ("CFB") in
connection with the preparation and filing with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Act"), of a
Form S-3 Registration Statement dated January 16, 1997, as amended (the
"Registration Statement"). The Registration Statement relates to the offer
for sale of 2,400,000 __% Cumulative Capital Securities (the "Capital
Securities") of CFB Capital I ("CFB Capital"), a statutory business trust
formed by CFB under the laws of the State of Delaware, and the Junior
Subordinated Debentures to be issued by CFB to CFB Capital in connection with
the sale of the Capital Securities.

This opinion letter relates to the material federal income tax
consequences of the purchase and ownership of the Capital Securities by
investors. All capitalized terms used in this opinion letter and not
otherwise defined herein are used as described in the Registration Statement.

We have examined the Registration Statement and such other documents as
we have deemed necessary to render our opinion expressed below. In our
examination of such material, we have relied upon the current and continued
accuracy of the factual matters we have considered, and we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to
us as originals and the conformity to original documents of all copies of
documents submitted to us. In addition, we also have assumed that the
transactions related to the issuance of the Junior Subordinated Debentures
and the Capital Securities will be consummated in accordance with the terms
and forms of the documents. As to any facts material to the opinions
expressed herein which were not independently established or verified, we
have relied upon oral or written statements and representations of officers,
trustees, and other representatives of CFB, CFB Capital and others.

<PAGE>

LINDQUIST & VENNUM P.L.L.P.
Community First Bankshares, Inc.
January 30, 1997
Page 2

Based on the foregoing, and assuming that CFB Capital was formed and will
be maintained in compliance with the terms of the Trust Agreement it is our
opinion that:

(1) CFB Capital will be classified for United States federal income tax
purposes as a grantor trust and not as an association taxable as a corporation
for United States federal income tax purposes, and as a result, each beneficial
owner of Capital Securities will be treated as owning an undivided beneficial
interest in the Junior Subordinated Debentures.

(2) Stated interest on the Junior Subordinated Debentures generally will
be included in income by a Securityholder at the time such interest income is
paid or accrued in accordance with the Securityholder's regular method of tax
accounting.

(3) Gain or loss will be recognized by a Securityholder on a sale of
Capital Securities (including a redemption for cash) in an amount equal to the
difference between the amount realized (which for this purpose, will exclude
amounts attributable to accrued interest or OID not previously included in
income) and the Securityholder's adjusted tax basis in the Capital Securities
sold or so redeemed. Gain or loss recognized by the Securityholder on Capital
Securities held for more than one year will generally be taxable as long-term
capital gain or loss.

This opinion is based upon the Internal Revenue Code of 1986, as amended,
the Treasury regulations promulgated thereunder and other relevant authorities
and law, all as in effect on the date hereof. Consequently, future changes in
the law may cause the tax treatment of the transactions referred to herein to be
materially different from that described above.

Other than the specific tax opinions set forth in this letter, no other
opinion has been rendered with respect to the tax treatment of the proposed
issuance and sale of the Junior Subordinated Debentures or the Capital
Securities, including, but not limited to, the tax treatment of the proposed
transactions under other provisions of the Code and the regulations, the tax
treatment of any conditions existing at the time of, or effects resulting from,
the proposed transactions that are not specifically covered by the above
opinions, or the tax treatment of the proposed transactions under state, local,
foreign or any other tax laws.

We hereby consent to the filing of this letter as an exhibit to the
Registration Statement and the use of our name in the Registration Statement
under the captions "Certain Federal Income Tax Consequences." In giving such
consent, we do not concede that this consent is required under Section 7 of the
Securities Act of 1933.

Very truly yours,

LINDQUIST & VENNUM P.L.L.P.