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EXHIBIT 10.1
 
(CDFI Bank/Thrifts
Senior Preferred Stock)

UNITED STATES DEPARTMENT OF THE TREASURY
1500 PENNSYLVANIA AVENUE, NW
WASHINGTON, D.C. 20220

Dear Ladies and Gentlemen:

The company set forth on the signature page hereto (the “Company”) intends to
issue the number of shares of a series of its preferred stock set forth on
Schedule A hereto (the “CDCI Preferred Shares”) to the United States Department
of the Treasury (the “Investor”) in exchange for the number of shares of
preferred stock previously acquired by the Investor pursuant to the Company’s
participation in the Troubled Asset Relief Program Capital Purchase Program set
forth on Schedule A (the “CPP Preferred Shares”).

The purpose of this letter agreement is to confirm the terms and conditions of
the exchange.  Except to the extent supplemented or superseded by the terms set
forth herein or in the Schedules hereto, the provisions contained in the
Exchange Agreement – Standard Terms attached hereto as Exhibit A (the “Exchange
Agreement”) are incorporated by reference herein.  Terms that are defined in the
Exchange Agreement are used in this letter agreement as so defined.  In the
event of any inconsistency between this letter agreement and the Exchange
Agreement, the terms of this letter agreement shall govern.

Each of the Company and the Investor hereby confirms its agreement with the
other party with respect to the issuance by the Company of the CDCI Preferred
Shares and the exchange of the “Preferred Shares” for the CPP Preferred Shares
pursuant to this letter agreement and the Exchange Agreement on the terms
specified on Schedule A hereto.

This letter agreement (including the Schedules hereto), the Exchange Agreement
(including the Annexes thereto) and the Disclosure Schedules (as defined in the
Exchange Agreement) constitute the entire agreement, and supersede all other
prior agreements, understandings, representations and warranties, both written
and oral, between the parties, with respect to the subject matter hereof.  This
letter agreement constitutes the “Letter Agreement” referred to in the Exchange
Agreement.

This letter agreement may be executed in any number of separate counterparts,
each such counterpart being deemed to be an original instrument, and all such
counterparts will together constitute the same agreement.  Executed signature
pages to this letter agreement may be delivered by facsimile and such facsimiles
will be deemed as sufficient as if actual signature pages had been delivered.

* * *

 
 

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In witness whereof, this letter agreement has been duly executed and delivered
by the duly authorized representatives of the parties hereto as of the date
written below.

 
UNITED STATES DEPARTMENT OF THE TREASURY
         
By:
/s/ David M. Miller    
Name:
David M. Miller    
Title:
Chief Investment Officer          
COMPANY: UNITED BANCORPORATION OF ALABAMA, INC.
         
By:
/s/ Robert R. Jones, III
   
Name:
Robert R. Jones, III
   
Title:
President and CEO

Date:  September 3, 2010

 
 

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EXHIBIT A
(CDFI Bank/Thrifts
Senior Preferred Stock)

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EXCHANGE AGREEMENT
 
STANDARD TERMS
 
 
 
 
 

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TABLE OF CONTENTS
 

             
Page
               
ARTICLE I
       
THE CLOSING; THE EXCHANGE OF CDCI PREFERRED STOCK FOR CPP PREFERRED STOCK
       
Section 1.1
 
The CDCI Preferred Stock
2
Section 1.2
 
The Closing
2
       
ARTICLE II
       
EXCHANGE
       
Section 2.1
 
Exchange
5
Section 2.2
 
Exchange Documentation
5
       
ARTICLE III
       
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
       
Section 3.1
 
Existence and Power
6
Section 3.2
 
CDCI Preferred Shares
6
Section 3.3
 
Community Development Financial Institution Status; Domestic Ownership
7
Section 3.4
 
Authorization and Enforceability
7
Section 3.5
 
Anti-Takeover Provisions and Rights Plan
8
Section 3.6
 
No Company Material Adverse Effect
8
Section 3.7
 
Company Financial Statements
8
Section 3.8
 
No Undisclosed Liabilities
8
Section 3.9
 
Offering of Securities
9
Section 3.10
 
Litigation and Other Proceedings
9
Section 3.11
 
Compliance with Laws
9
Section 3.12
 
Employee Benefit Matters
9
Section 3.13
 
Taxes
10
Section 3.14
 
Properties and Leases
10
Section 3.15
 
Environmental Liability
11
Section 3.16
 
Risk Management Instruments
11
Section 3.17
 
Agreements with Regulatory Agencies
11
Section 3.18
 
Insurance
12
Section 3.19
 
Intellectual Property
12
Section 3.20
 
Brokers and Finders
12
Section 3.21
 
Disclosure Schedule
12
Section 3.22
 
CPP Preferred Stock
13

 
i

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ARTICLE IV
       
COVENANTS
       
Section 4.1
 
Affirmative Covenants
13
Section 4.2
 
Negative Covenants
20
       
ARTICLE V
       
ADDITIONAL AGREEMENTS
       
Section 5.1
 
Purchase for Investment
21
Section 5.2
 
Legends
21
Section 5.3
 
Transfer of CDCI Preferred Shares
23
Section 5.4
 
Rule 144; Rule 144A; 4(1½) Transactions
23
Section 5.5
 
Depositary Shares
24
Section 5.6
 
Expenses and Further Assurances
25
Section 5.7
 
Repurchase of Investor Securities
25
       
ARTICLE VI
       
MISCELLANEOUS
       
Section 6.1
 
Termination
25
Section 6.2
 
Survival
26
Section 6.3
 
Amendment
26
Section 6.4
 
Waiver of Conditions
27
Section 6.5
 
Governing Law; Submission to Jurisdiction, etc
27
Section 6.6
 
Notices
27
Section 6.7
 
Definitions, Interpretation
28
Section 6.8
 
Interpretation
31
Section 6.9
 
Assignment
31
Section 6.10
 
Severability
32
Section 6.11
 
No Third-Party Beneficiaries
32
Section 6.12
 
Entire Agreement, etc
32
Section 6.13
 
Specific Performance
32

 
ii

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LIST OF ANNEXES

ANNEX A:  FORM OF OFFICER’S CERTIFICATE
ANNEX B:  FORM OF NEW CERTIFICATE OF DESIGNATIONS
ANNEX C:  FORM OF OPINION
ANNEX D:  FORM OF WAIVER
ANNEX E:  REGISTRATION RIGHTS
ANNEX F:  FORM OF OFFICER’S CERTIFICATE (CDFI REQUIREMENTS)

 
iii

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Defined Terms
         
Affiliate
 
Section 6.7(a)(ii)
Agreement
 
Recitals
Appropriate Federal Banking Agency
 
Section 6.7(a)(iii)
Bank Holding Company
 
Section 6.7(a)(iv)
Bankruptcy Exceptions
 
Section 3.4(a)
Benefit Plans
 
Section 1.2(c)(vi)
Board of Directors
 
Section 3.5
Business Combination
 
Section 6.7(a)(v)
Capitalization Date
 
Section 3.1(b)
CDCI
 
Recitals
CDCI Preferred Shares
 
Recitals
CDCI Preferred Stock
 
Recitals
CDFI
 
Section 3.3
CDFI Application
 
Section 1.2(c)(xii)
CDFI Application Update
 
Section 1.2(c)(xii)
Certified Entity
 
Section 6.7 (a)(vi)
Charter
 
Section 1.2(c)(iv)
Closing
 
Section 1.2(a)
Closing Date
 
Section 1.2(a)
Code
 
Section 3.12
Common Stock
 
Section 3.1(b)
Company
 
Recitals
Company Financial Statements
 
Section 6.7(a)(vii)
Company Material Adverse Effect
 
Section 6.7(a)(viii)
Company Subsidiaries
 
Section 3.4(b)
Compensation Regulations
 
Section 1.2(c)(vi)
Controlled Group
 
Section 3.12
CPP
 
Recitals
CPP Preferred Shares
 
Recitals
CPP Preferred Stock
 
Recitals
CPP Securities
 
Section 6.12(b)
CPP Securities Purchase Agreement
 
Recitals
CPP Signing Date
 
Recitals
CPP Waiver
 
Section 1.2(c)(vii)
Designated Matters
 
Section 6.7(a)(ix)
Development Services
 
Section 4.1(d)(i)
Disclosure Schedule
 
Section 6.7(a)(x)
Disclosure Update
 
Section 1.2(c)(xi)
EAWA
 
Section 6.7(a)(xi)
EESA
 
Section 1.2(c)(vi)
ERISA
 
Section 3.12
Exchange
 
Recitals
Exchange Act
 
Section 5.3

 
iv

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Federal Reserve
 
Section 6.7(a)(iv)
Financial Products
 
Section 4.1(d)(i)
Fund
 
Section 1.2(c)(xii)
Governmental Entities
 
Section 1.2(c)
Holder
 
Section 5.4
Indemnitee
 
Section 5.4(b)
Information
 
Section 4.1(c)(iii)
Investment Area
 
Section 4.1(d)(i)
Investor
 
Recitals
Junior Stock
 
Section 6.7(a)(xii)
Letter Agreement
 
Recitals
MHA
 
Section 4.1(i)
New Certificate of Designations
 
Section 1.2(c)(iv)
Parity Stock
 
Section 6.7(a)(xiii)
Plan
 
Section 3.12
Previously Disclosed
 
Section 6.7(a)(xiv)
Proprietary Rights
 
Section 3.19
Regulatory Agreement
 
Section 3.17
Relevant Period
 
Section 1.2(c)(vi)
Savings and Loan Holding Company
 
Section 6.7(a)(xv)
Schedules
 
Recitals
SEC
 
Section 3.9
Section 4.1(e) Employee
 
Section 4.1(e)(ii)
Securities Act
 
Section 3.1(a)
Senior Executive Officers
 
Section 6.7(a)(xvi)
Share Dilution Amount
 
Section 6.7(a)(xvii)
Signing Date
 
Section 1.2(c)(xi)
subsidiary
 
Section 6.7(a)(i)
Target Market
 
Section 4.1(d)(i)
Targeted Populations
 
Section 4.1(d)(i)
Tax
 
Section 6.7(xviii)
Transfer
 
Section 5.3

 
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EXCHANGE AGREEMENT – STANDARD TERMS

Recitals:

WHEREAS, the United States Department of the Treasury (the “Investor”) has
purchased shares of preferred stock or has acquired shares of preferred stock
through the exercise of warrants or the exchange of other securities
(collectively, the “CPP Preferred Stock”) from eligible financial institutions
which elected to participate in the Troubled Asset Relief Program Capital
Purchase Program (“CPP”);

WHEREAS, the Investor may from time to time agree to exchange the shares of CPP
Preferred Stock it received from eligible financial institutions that
participated in CPP for newly issued shares of preferred stock (“CDCI Preferred
Stock”) from such eligible financial institutions to the extent they elect to
participate in the Community Development Capital Initiative (“CDCI”);

WHEREAS, an eligible financial institution electing to participate in the
CDCI  and exchange CPP Preferred Stock for CDCI Preferred Stock shall enter into
a letter agreement (the “Letter Agreement”) with the Investor which incorporates
this Exchange Agreement – Standard Terms (the eligible financial institution
identified in the Letter Agreement, the “Company”);

WHEREAS, the Company issued the CPP Preferred Stock (or warrants exercised to
acquire the CPP Preferred Stock or the securities exchanged for the CPP
Preferred Stock) pursuant to that certain Securities Purchase Agreement –
Standard Terms incorporated into a letter agreement, dated as of the date set
forth on Schedule A to the Letter Agreement (the “CPP Signing Date”), as amended
from time to time, between the Company and the Investor (the “CPP Securities
Purchase Agreement”);

WHEREAS, the Company agrees to support the availability of credit and financial
services to underserved populations and communities in the United States to
promote the expansion of small businesses and the creation of jobs in such
populations and communities;

WHEREAS, the Company agrees to work diligently, under existing and any future
programs, to modify the terms of residential mortgages as appropriate to
strengthen the health of the U.S. housing market;

WHEREAS, the Company intends to issue the number of shares of the series of its
CDCI Preferred Stock set forth on Schedule A to the Letter Agreement (the “CDCI
Preferred Shares”) to the Investor in exchange for (the “Exchange”) the number
of shares of the CPP Preferred Stock set forth on Schedule A to the Letter
Agreement (the “CPP Preferred Shares”); and

 
 

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WHEREAS, the Exchange will be governed by this Exchange Agreement – Standard
Terms and the Letter Agreement, including the schedules thereto (the
“Schedules”), specifying additional terms of the Exchange. This Exchange
Agreement – Standard Terms (including the Annexes hereto) and the Letter
Agreement (including the Schedules thereto) are together referred to as this
“Agreement”.  All references in this Exchange Agreement – Standard Terms to
“Schedules” are to the Schedules attached to the Letter Agreement.

NOW, THEREFORE, in consideration of the premises, and of the representations,
warranties, covenants and agreements set forth herein, the parties agree as
follows:

ARTICLE I

THE CLOSING; THE EXCHANGE OF CDCI PREFERRED STOCK FOR CPP PREFERRED STOCK

Section 1.1            The CDCI Preferred Stock.  The CDCI Preferred Shares are
being issued to the Investor in the Exchange pursuant to Article II hereof.  The
CPP Preferred Shares exchanged for the CDCI Preferred Shares pursuant to Article
II hereof are being reacquired by the Company and shall have the status of
authorized but unissued shares of preferred stock of the Company undesignated as
to series and may be designated or redesignated and issued or reissued, as the
case may be, as part of any series of preferred stock of the Company; provided
that such shares shall not be reissued as shares of CPP Preferred Stock.

Section 1.2            The Closing.  (a) On the terms and subject to the
conditions set forth in this Agreement, the closing of the Exchange (the
“Closing”) will take place at the location specified in Schedule A, at the time
and on the date set forth in Schedule A or as soon as practicable thereafter, or
at such other place, time and date as shall be agreed between the Company and
the Investor.  The time and date on which the Closing occurs is referred to in
this Agreement as the “Closing Date”.

(b)              Subject to the fulfillment or waiver of the conditions to the
Closing in this Section 1.2, at the Closing (i) the Company will deliver the
CDCI Preferred Shares to the Investor, as evidenced by one or more certificates
dated the Closing Date and registered in the name of the Investor or its
designee(s) and (ii) the Investor will deliver the certificate representing the
CPP Preferred Shares to the Company.

(c)              The obligation of the Investor to consummate the Exchange is
also subject to the fulfillment (or waiver by the Investor) at or prior to the
Closing of each of the following conditions:

(i)               (A) any approvals or authorizations of all United States and
other governmental, regulatory or judicial authorities (collectively,
“Governmental Entities”) required for the consummation of the Exchange shall
have been obtained or made in form and substance reasonably satisfactory to each
party and shall be in full force and effect and all waiting periods required by
United States and other applicable law, if any, shall have expired and (B) no
provision of any applicable United States or other law and no judgment,
injunction, order or decree of any Governmental Entity shall prohibit
consummation of the Exchange as contemplated by this Agreement;

 
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(ii)              (A) the representations and warranties of the Company set
forth in Article III of this Agreement shall be true and correct in all respects
as though made on and as of the Closing Date (other than representations and
warranties that by their terms speak as of another date, which representations
and warranties shall be true and correct in all respects as of such other date)
and (B) the Company shall have performed in all respects all obligations
required to be performed by it under this Agreement at or prior to the Closing;

(iii)              the Company shall have delivered to the Investor a
certificate signed on behalf of the Company by a Senior Executive Officer
certifying to the effect that the conditions set forth in Section 1.2(c)(ii)
have been satisfied, in substantially the form attached hereto as Annex A;

(iv)             the Company shall have duly adopted and filed with the
Secretary of State of its jurisdiction of organization or other applicable
Governmental Entity an amendment to its certificate or articles of
incorporation, articles of association, or similar organizational document
(“Charter”) in substantially the form attached hereto as Annex B (the “New
Certificate of Designations”) and the Company shall have delivered to the
Investor a copy of the filed New Certificate of Designations with appropriate
evidence from the Secretary of State or other applicable Governmental Entity
that the filing has been accepted, or if a filed copy is unavailable, a
certificate signed on behalf of the Company by a Senior Executive Officer
certifying to the effect that the filing of the New Certificate of Designation
has been accepted, in substantially the form attached hereto as Annex A;

(v)              the Company shall have delivered to the Investor, a certificate
signed on behalf of the Company by a Senior Executive Officer certifying to the
effect that the Charter and bylaws of the Company delivered to the Investor
pursuant to the CPP Securities Purchase Agreement remain true, complete and
correct, in substantially the form attached hereto as Annex A; to the extent
that the Charter and bylaws of the Company delivered to the Investor pursuant to
the CPP Securities Purchase Agreement are no longer true, correct and complete,
prior to the Closing Date, the Company shall deliver to Investor true, complete
and correct certified copies of any amendments or supplements to the Charter or
bylaws of the Company or the documentation necessary to make the Charter or
bylaws of the Company delivered to the Investor true, correct and complete as of
the Closing Date;

(vi)             (A) the Company shall have effected such changes to its
compensation, bonus, incentive and other benefit plans, arrangements and
agreements (including golden parachute, severance and employment agreements)
(collectively, “Benefit Plans”) with respect to its Senior Executive Officers
and any other employee of the Company or its Affiliates subject to Section 111
of the Emergency Economic Stabilization Act of 2008, as amended by the American
Recovery and Reinvestment Act of 2009, or otherwise from time to time (“EESA”),
as implemented by any guidance, rule or regulation thereunder, as the same shall
be in effect from time to time (collectively, the “Compensation Regulations”)
(and to the extent necessary for such changes to be legally enforceable, each of
its Senior Executive Officers and other employees shall have duly consented in
writing to such changes), as may be necessary, during the period in which any
obligation of the Company arising from financial assistance under the Troubled
Asset Relief Program remains outstanding (such period, as it may be further
described in the Compensation Regulations, the “Relevant Period”), in order to
comply with Section 111 of EESA or the Compensation Regulations and (B) the
Investor shall have received a certificate signed on behalf of the Company by a
Senior Executive Officer certifying to the effect that the condition set forth
in Section 1.2(c)(vi)(A) has been satisfied, in substantially the form attached
hereto as Annex A;

 
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(vii)            the Company shall have delivered to the Investor, a written
waiver from each of the Company’s Senior Executive Officers and any other
employee of the Company required to have delivered a waiver to Investor pursuant
to Section 1.2(d)(v) of the CPP Securities Purchase Agreement (each, a “CPP
Waiver”) and, to the extent that any Senior Executive Officer or any other
employee of the Company or its Affiliates that are subject to Section 111 of
EESA did not deliver a CPP Waiver, the Company shall cause each such Senior
Executive Officer or other employee to have delivered to the Investor a written
waiver in the form attached hereto as Annex D releasing the Investor and the
Company from any claims that such Senior Executive Officer or other employee may
otherwise have as a result of the modification of, or the agreement of the
Company hereunder to modify, the terms of any Benefit Plans with respect to its
Senior Executive Officers or other employees to eliminate any provisions of such
Benefit Plans that would not be in compliance with the requirements of Section
111 of EESA as implemented by the Compensation Regulations;

(viii)           the Company shall have delivered to the Investor a written
opinion from counsel to the Company (which may be internal counsel), addressed
to the Investor and dated as of the Closing Date, in substantially the form
attached hereto as Annex C;

(ix)              the Company shall have delivered certificates in proper form
or, with the prior consent of the Investor, evidence of shares in book-entry
form, evidencing the CDCI Preferred Shares to the Investor or its designee(s);

(x)               the Company and the Company Subsidiaries shall have taken all
necessary action to ensure that the Company and the Company Subsidiaries and
their executive officers, respectively, are in compliance with (i) all
guidelines put forth by the Investor with respect to transparency, reporting and
monitoring and (ii) the provisions of EESA and any federal law respecting EESA,
including the Employ American Workers Act (Section 1611 of Division A, Title XVI
of the American Recovery and Reinvestment Act of 2009), Public Law No. 111-5,
effective as of February 17, 2009, and all rules, regulations and guidance
issued thereunder;

(xi)              the Company shall have delivered to the Investor, a copy of
the Disclosure Schedule on or prior to the date of the Letter Agreement (the
“Signing Date”) and, to the extent that any information set forth on the
Disclosure Schedule needs to be updated or supplemented to make it true,
complete and correct as of the Closing Date, (i) the Company shall have
delivered to the Investor an update to the Disclosure Schedule (the “Disclosure
Update”), setting forth any information necessary to make the Disclosure
Schedule true, correct and complete as of the Closing Date and (ii) the
Investor, in its sole discretion, shall have approved the Disclosure Update,
provided, however, that the delivery and acceptance of the Disclosure Update
shall not limit or affect any rights of or remedies available to the Investor;

 
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(xii)            the Company shall have delivered to the Investor prior to the
Signing Date either (i) a true, complete and correct certified copy of each CDFI
Certification Application that each Certified Entity submitted to the Community
Development Financial Institution Fund (the “Fund”)  in connection with its
certification as a CDFI along with any updates to the CDFI Certification
Application necessary to make it true, complete and correct as of the Signing
Date or (ii), to the extent a copy of the CDFI Certification Application that
any Certified Entity submitted to the Fund in connection with its certification
as a CDFI is not available, a newly completed CDFI Certification Application
with respect to such Certified Entity true, complete and correct as of the
Signing Date (the CDFI Certification Application delivered to the Investor
pursuant to this Section 1.2(c)(xii), the “CDFI Application”), and, to the
extent any information set forth in the CDFI Application is not true, complete
and correct as of the Closing Date, the Company shall have delivered to the
Investor an update to the CDFI Application (the “CDFI Application Update”),
setting forth any information necessary to make the information set forth in the
CDFI Application true, correct and complete as of the Closing Date; and

(xiii)            CPP/CDCI Securities.  The Company shall have paid to Investor
all accrued and unpaid dividends or interest then due on the CPP Preferred
Stock.

ARTICLE II

EXCHANGE

Section 2.1           Exchange.  On the terms and subject to the conditions set
forth in this Agreement, the Company agrees to issue the CDCI Preferred Shares
to the Investor in exchange for CPP Preferred Shares, and the Investor agrees to
deliver to the Company the CPP Preferred Shares in exchange for the CDCI
Preferred Shares.

Section 2.2            Exchange Documentation.  Settlement of the Exchange will
take place on the Closing Date, at which time the Investor will cause delivery
of the CPP Preferred Shares to the Company or its designated agent and the
Company will cause delivery of the CDCI Preferred Shares to the Investor or its
designated agent.

 
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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Except as Previously Disclosed, the Company represents and warrants to the
Investor that as of the Signing Date and as of the Closing Date (or such other
date specified herein) that:

Section 3.1            Existence and Power.
 
(a)              Organization, Authority and Significant Subsidiaries.  The
Company has been duly incorporated and is validly existing and in good standing
under the laws of its jurisdiction of organization, with the necessary power and
authority to own, operate and lease its properties and to conduct its business
in all material respects as it is being currently conducted, and except as has
not, individually or in the aggregate, had and would not reasonably be expected
to have a Company Material Adverse Effect, has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification; each Certified Entity
(if not the Company) and each subsidiary of the Company that would be considered
a “significant subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X
under the Securities Act of 1933 (the “Securities Act”), has been duly organized
and is validly existing in good standing under the laws of its jurisdiction of
organization.  The Charter and bylaws of the Company and each Certified Entity
(if not the Company), copies of which have been provided to the Investor prior
to the Signing Date, are true, complete and correct copies of such documents as
in full force and effect as of the Signing Date and as of the Closing Date.

(b)              Capitalization.  The authorized capital stock of the Company,
and the outstanding capital stock of the Company (including securities
convertible into, or exercisable or exchangeable for, capital stock of the
Company) as of the most recent fiscal month-end preceding the Signing Date (the
“Capitalization Date”) is set forth on Schedule B.  The outstanding shares of
capital stock of the Company have been duly authorized and are validly issued
and outstanding, fully paid and nonassessable, and subject to no preemptive
rights (and were not issued in violation of any preemptive rights).  As of the
Signing Date, the Company does not have outstanding any securities or other
obligations providing the holder the right to acquire common stock of the
Company (“Common Stock”) or other capital stock that is not reserved for
issuance as specified on Schedule B, and the Company has not made any other
commitment to authorize, issue or sell any Common Stock or other capital
stock.  Since the Capitalization Date, the Company has not issued any shares of
Common Stock or other capital stock other than (i) shares issued upon the
exercise of stock options or delivered under other equity-based awards or other
convertible securities or warrants which were issued and outstanding on the
Capitalization Date and disclosed on Schedule B and (ii) shares disclosed on
Schedule B.  Each holder of 5% or more of any class of capital stock of the
Company and such holder’s primary address are set forth on Schedule B.

Section 3.2            CDCI Preferred Shares.  The CDCI Preferred Shares have
been duly and validly authorized by all necessary action, and, when issued and
delivered pursuant to this Agreement, such CDCI Preferred Shares will be duly
and validly issued and fully paid and nonassessable, will not be issued in
violation of any preemptive rights, and will rank pari passu or senior to all
other series or classes of CDCI Preferred Stock, whether or not designated,
issued or outstanding, with respect to the payment of dividends and the
distribution of assets in the event of any dissolution, liquidation or winding
up of the Company.

 
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Section 3.3            Community Development Financial Institution Status;
Domestic Ownership.

(a)              The Company, collectively with all of its “Affiliates” (within
the meaning of 12 C.F.R. 1805.104) satisfies the requirements of 12 C.F.R.
1805.200(b).

(b)              Each Certified Entity (A) is a regulated community development
financial institution (a “CDFI”) currently certified by the Fund of the United
States Department of the Treasury pursuant to 12 C.F.R. 1805.201(a) as having
satisfied the eligibility requirements of the Fund’s Community Development
Financial Institutions Program and (B) satisfies the eligibility requirements
for a CDFI set forth in 12 C.F.R. 1805.201(b)(1) – (6).

(c)              The Company is not a Bank Holding Company, Savings and Loan
Holding Company, bank or savings association controlled (within the meaning of
the Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)(2)) and 12 C.F.R.
225(a)(i) in the case of Bank Holding Companies and banks and the Home Owners’
Loan Act of 1933 (12 U.S.C. 1467a (a)(2)) and 12 C.F.R. 583.7 in the case of
Savings and Loan Holding Companies and savings associations) by a foreign bank
or company.

Section 3.4            Authorization and Enforceability.  (a) The Company has
the corporate power and authority to execute and deliver this Agreement and to
carry out its obligations hereunder (which includes the issuance of the CDCI
Preferred Shares). The execution, delivery and performance by the Company of
this Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate action on the part of the
Company and its stockholders, and no further approval or authorization is
required on the part of the Company. This Agreement is a valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, subject to any limitations by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and general equitable principles, regardless of
whether such enforceability is considered in a proceeding at law or in equity
(“Bankruptcy Exceptions”).

(b)              The execution, delivery and performance by the Company of this
Agreement and the consummation of the transactions contemplated hereby, and
compliance by the Company with the provisions hereof, will not (A) violate,
conflict with, or result in a breach of any provision of, or constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or accelerate the
performance required by, or result in a right of termination or acceleration of,
or result in the creation of, any lien, security interest, charge or encumbrance
upon any of the properties or assets of the Company or any subsidiary of the
Company or Certified Entity (if not the Company) (each subsidiary or Certified
Entity, a “Company Subsidiary” and, collectively, the “Company Subsidiaries”)
under any of the terms, conditions or provisions of (i) its organizational
documents or (ii) any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which the Company or any
Company Subsidiary is a party or by which it or any Company Subsidiary may be
bound, or to which the Company or any Company Subsidiary or any of the
properties or assets of the Company or any Company Subsidiary may be subject, or
(B) subject to compliance with the statutes and regulations referred to in the
next paragraph, violate any statute, rule or regulation or any judgment, ruling,
order, writ, injunction or decree applicable to the Company or any Company
Subsidiary or any of their respective properties or assets except, in the case
of clauses (A)(ii) and (B), for those occurrences that, individually or in the
aggregate, have not had and would not reasonably be expected to have a Company
Material Adverse Effect.

 
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(c)           Other than the filing of the New Certificate of Designations with
the Secretary of State of its jurisdiction of organization or other applicable
Governmental Entity, such filings and approvals as are required to be made or
obtained under any state “blue sky” laws and such as have been made or obtained,
no notice to, filing with, exemption or review by, or authorization, consent or
approval of, any Governmental Entity is required to be made or obtained by the
Company in connection with the consummation by the Company of the Exchange
except for any such notices, filings, exemptions, reviews, authorizations,
consents and approvals the failure of which to make or obtain would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect.

Section 3.5            Anti-Takeover Provisions and Rights Plan.  The Board of
Directors of the Company (the “Board of Directors”) has taken all necessary
action to ensure that the transactions contemplated by this Agreement and the
consummation of the transactions contemplated hereby, will be exempt from any
anti-takeover or similar provisions of the Company’s Charter and bylaws, and any
other provisions of any applicable “moratorium”, “control share”, “fair price”,
“interested stockholder” or other anti-takeover laws and regulations of any
jurisdiction.

Section 3.6            No Company Material Adverse Effect.  Since the CPP
Signing Date, no fact, circumstance, event, change, occurrence, condition or
development has occurred that, individually or in the aggregate, has had or
would reasonably be expected to have a Company Material Adverse Effect, except
as disclosed on Schedule C.

Section 3.7            Company Financial Statements.  The Company Financial
Statements present fairly in all material respects the consolidated financial
position of the Company and its consolidated subsidiaries as of the dates
indicated therein and the consolidated results of their operations for the
periods specified therein; and except as stated therein, such financial
statements (i) were prepared in conformity with GAAP applied on a consistent
basis (except as may be noted therein) and (ii) have been prepared from, and are
in accordance with, the books and records of the Company and the Company
Subsidiaries.

Section 3.8            No Undisclosed Liabilities.  Neither the Company nor any
of the Company Subsidiaries has any liabilities or obligations of any nature
(absolute, accrued, contingent or otherwise) which are not properly reflected or
reserved against in the Company Financial Statements to the extent required to
be so reflected or reserved against in accordance with GAAP, except for (i)
liabilities that have arisen since the last fiscal year end in the ordinary and
usual course of business and consistent with past practice and (ii) liabilities
that, individually or in the aggregate, have not had and would not reasonably be
expected to have a Company Material Adverse Effect.

 
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Section 3.9            Offering of Securities.  Neither the Company nor any
person acting on its behalf has taken any action (including any offering of any
securities of the Company under circumstances which would require the
integration of such offering with the offering of the CDCI Preferred Shares
under the Securities Act and the rules and regulations of the Securities and
Exchange Commission (the “SEC”) promulgated thereunder), which might subject the
issuance or acquisition of the CDCI Preferred Shares to the Investor pursuant to
this Agreement to the registration requirements of the Securities Act.

Section 3.10          Litigation and Other Proceedings.  Except (i) as set forth
on Schedule D or (ii) as would not, individually or in the aggregate, reasonably
be expected to have a Company Material Adverse Effect, there is no (A) pending
or, to the knowledge of the Company, threatened, claim, action, suit,
investigation or proceeding, against the Company or any Company Subsidiary or to
which any of their assets are subject, nor is the Company or any Company
Subsidiary subject to any order, judgment or decree or (B) unresolved violation,
criticism or exception by any Governmental Entity with respect to any report or
relating to any examinations or inspections of the Company or any Company
Subsidiaries.

Section 3.11          Compliance with Laws. Except as would not, individually or
in the aggregate, reasonably be expected to have a Company Material Adverse
Effect, the Company and the Company Subsidiaries have all permits, licenses,
franchises, authorizations, orders and approvals of, and have made all filings,
applications and registrations with, Governmental Entities that are required in
order to permit them to own or lease their properties and assets and to carry on
their business as presently conducted and that are material to the business of
the Company or such Company Subsidiary.  Except as set forth on Schedule E, the
Company and the Company Subsidiaries have complied in all respects and are not
in default or violation of, and none of them is, to the knowledge of the
Company, under investigation with respect to or, to the knowledge of the
Company, have been threatened to be charged with or given notice of any
violation of, any applicable domestic (federal, state or local) or foreign law,
statute, ordinance, license, rule, regulation, policy or guideline, order,
demand, writ, injunction, decree or judgment of any Governmental Entity, other
than such noncompliance, defaults or violations that would not, individually or
in the aggregate, reasonably be expected to have a Company Material Adverse
Effect.  Except for statutory or regulatory restrictions of general application
or as set forth on Schedule E, no Governmental Entity has placed any restriction
on the business or properties of the Company or any Company Subsidiary that
would, individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect.

Section 3.12          Employee Benefit Matters.  Except as would not reasonably
be expected to have, either individually or in the aggregate, a Company Material
Adverse Effect: (i) each “employee benefit plan” (within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”)) providing benefits to any current or former employee, officer or
director of the Company or any member of its “Controlled Group” (defined as any
organization which is a member of a controlled group of corporations within the
meaning of Section 414 of the Internal Revenue Code of 1986, as amended (the
“Code”)) that is sponsored, maintained or contributed to by the Company or any
member of its Controlled Group and for which the Company or any member of its
Controlled Group would have any liability, whether actual or contingent (each, a
“Plan”) has been maintained in compliance with its terms and with the
requirements of all applicable statutes, rules and regulations, including ERISA
and the Code; (ii) with respect to each Plan subject to Title IV of ERISA
(including, for purposes of this clause (ii), any plan subject to Title IV of
ERISA that the Company or any member of its Controlled Group previously
maintained or contributed to in the six years prior to the Signing Date), (1) no
“reportable event” (within the meaning of Section 4043(c) of ERISA), other than
a reportable event for which the notice period referred to in Section 4043(c) of
ERISA has been waived, has occurred in the three years prior to the Signing Date
or is reasonably expected to occur, (2) no “accumulated funding deficiency”
(within the meaning of Section 302 of ERISA or Section 412 of the Code), whether
or not waived, has occurred in the three years prior to the Signing Date or is
reasonably expected to occur, (3) the fair market value of the assets under each
Plan exceeds the present value of all benefits accrued under such Plan
(determined based on the assumptions used to fund such Plan) and (4) neither the
Company nor any member of its Controlled Group has incurred in the six years
prior to the Signing Date, or reasonably expects to incur, any liability under
Title IV of ERISA (other than contributions to the Plan or premiums to the
Pension Benefit Guaranty Corporation in the ordinary course and without default)
in respect of a Plan (including any Plan that is a “multiemployer plan”, within
the meaning of Section 4001(c)(3) of ERISA); and (iii) each Plan that is
intended to be qualified under Section 401(a) of the Code has received a
favorable determination letter from the Internal Revenue Service with respect to
its qualified status that has not been revoked, or such a determination letter
has been timely applied for but not received by the Signing Date, and nothing
has occurred, whether by action or by failure to act, which could reasonably be
expected to cause the loss, revocation or denial of such qualified status or
favorable determination letter.

 
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Section 3.13          Taxes.  Except as would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect, (i)
the Company and the Company Subsidiaries have filed all federal, state, local
and foreign income and franchise Tax returns (together with any schedules and
attached thereto) required to be filed through the Signing Date, subject to
permitted extensions, and have paid all Taxes due thereon, (ii) all such Tax
returns (together with any schedules and attached thereto) are true, complete
and correct in all material respects and were prepared in compliance with all
applicable laws and (iii) no Tax deficiency has been determined adversely to the
Company or any of the Company Subsidiaries, nor does the Company have any
knowledge of any Tax deficiencies.

Section 3.14          Properties and Leases.  Except as would not, individually
or in the aggregate, reasonably be expected to have a Company Material Adverse
Effect, the Company and the Company Subsidiaries have good and marketable title
to all real properties and all other properties and assets owned by them, in
each case free from liens (including, without limitation, liens for Taxes),
encumbrances, claims and defects that would affect the value thereof or
interfere with the use made or to be made thereof by them.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, the Company and the Company Subsidiaries hold all
leased real or personal property under valid and enforceable leases with no
exceptions that would interfere with the use made or to be made thereof by them.

 
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Section 3.15          Environmental Liability.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect:

(a)              there is no legal, administrative, or other proceeding, claim
or action of any nature seeking to impose, or that would reasonably be expected
to result in the imposition of, on the Company or any Company Subsidiary, any
liability relating to the release of hazardous substances as defined under any
local, state or federal environmental statute, regulation or ordinance,
including the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, pending or, to the Company’s knowledge, threatened against the
Company or any Company Subsidiary;

(b)              to the Company’s knowledge, there is no reasonable basis for
any such proceeding, claim or action; and

(c)              neither the Company nor any Company Subsidiary is subject to
any agreement, order, judgment or decree by or with any court, Governmental
Entity or third party imposing any such environmental liability.

Section 3.16          Risk Management Instruments.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, all derivative instruments, including, swaps, caps,
floors and option agreements, whether entered into for the Company’s own
account, or for the account of one or more of the Company Subsidiaries or its or
their customers, were entered into (i) only in the ordinary course of business,
(ii) in accordance with prudent practices and in all material respects with all
applicable laws, rules, regulations and regulatory policies and (iii) with
counterparties believed to be financially responsible at the time; and each of
such instruments constitutes the valid and legally binding obligation of the
Company or one of the Company Subsidiaries, enforceable in accordance with its
terms, except as may be limited by the Bankruptcy Exceptions.  Neither the
Company or the Company Subsidiaries, nor, to the knowledge of the Company, any
other party thereto, is in breach of any of its obligations under any such
agreement or arrangement other than such breaches that would not, individually
or in the aggregate, reasonably be expected to have a Company Material Adverse
Effect.

Section 3.17          Agreements with Regulatory Agencies.  Except as set forth
on Schedule F, neither the Company nor any Company Subsidiary is subject to any
material cease-and-desist or other similar order or enforcement action issued
by, or is a party to any material written agreement, consent agreement or
memorandum of understanding with, or is a party to any commitment letter or
similar undertaking to, or is subject to any capital directive by, or since
December 31, 2006, has adopted any board resolutions at the request of, any
Governmental Entity that currently restricts in any material respect the conduct
of its business or that in any material manner relates to its capital adequacy,
its liquidity and funding policies and practices, its ability to pay dividends,
its credit, risk management or compliance policies or procedures, its internal
controls, its management or its operations or business (each item in this
sentence, a “Regulatory Agreement”), nor has the Company or any Company
Subsidiary been advised since December 31, 2006 by any such Governmental Entity
that it is considering issuing, initiating, ordering, or requesting any such
Regulatory Agreement.  The Company and each Company Subsidiary is in compliance
in all material respects with each Regulatory Agreement to which it is party or
subject, and neither the Company nor any Company Subsidiary has received any
notice from any Governmental Entity indicating that either the Company or any
Company Subsidiary is not in compliance in all material respects with any such
Regulatory Agreement.

 
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Section 3.18          Insurance.  The Company and the Company Subsidiaries are
insured with reputable insurers against such risks and in such amounts as the
management of the Company reasonably has determined to be prudent and consistent
with industry practice.  The Company and the Company Subsidiaries are in
material compliance with their insurance policies and are not in default under
any of the material terms thereof, each such policy is outstanding and in full
force and effect, all premiums and other payments due under any material policy
have been paid, and all claims thereunder have been filed in due and timely
fashion, except, in each case, as would not, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse Effect.

Section 3.19          Intellectual Property.  Except as would not, individually
or in the aggregate, reasonably be expected to have a Company Material Adverse
Effect, (i) the Company and each Company Subsidiary owns or otherwise has the
right to use, all intellectual property rights, including all trademarks, trade
dress, trade names, service marks, domain names, patents, inventions, trade
secrets, know-how, works of authorship and copyrights therein, that are used in
the conduct of their existing businesses and all rights relating to the plans,
design and specifications of any of its branch facilities (“Proprietary Rights”)
free and clear of all liens and any claims of ownership by current or former
employees, contractors, designers or others and (ii) neither the Company nor any
of the Company Subsidiaries is materially infringing, diluting, misappropriating
or violating, nor has the Company or any of the Company Subsidiaries received
any written (or, to the knowledge of the Company, oral) communications alleging
that any of them has materially infringed, diluted, misappropriated or violated,
any of the Proprietary Rights owned by any other person.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, to the Company’s knowledge, no other person is
infringing, diluting, misappropriating or violating, nor has the Company or any
or the Company Subsidiaries sent any written communications since January 1,
2007 alleging that any person has infringed, diluted, misappropriated or
violated, any of the Proprietary Rights owned by the Company and the Company
Subsidiaries.

Section 3.20          Brokers and Finders.  The Investor has no liability for
any amounts that any broker, finder or investment banker is entitled to for any
financial advisory, brokerage, finder’s or other fee or commission in connection
with this Agreement or the transactions contemplated hereby based upon
arrangements made by or on behalf of the Company or any Company Subsidiary.

Section 3.21          Disclosure Schedule.  The Company has delivered the
Disclosure Schedule and, if applicable, the Disclosure Update to the Investor
and the information contained in the Disclosure Schedule, as modified by the
information contained in the Disclosure Update, if applicable, is true, complete
and correct.

 
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Section 3.22          CPP Preferred Stock.  The Company has (i) not breached any
representation, warranty or covenant set forth in the CPP Securities Purchase
Agreement or any of the other documents governing the CPP Preferred Stock and
(ii) paid to Investor all accrued and unpaid dividends and/or interest then due
on the CPP Preferred Stock.

ARTICLE IV

COVENANTS

Section 4.1            Affirmative Covenants.  The Company hereby covenants and
agrees with Investor that:

(a)              Commercially Reasonable Efforts.  Subject to the terms and
conditions of this Agreement, each of the parties will use its commercially
reasonable efforts in good faith to take, or cause to be taken, all actions, and
to do, or cause to be done, all things necessary, proper or desirable, or
advisable under applicable laws, so as to permit consummation of the Exchange as
promptly as practicable and otherwise to enable consummation of the transactions
contemplated hereby and shall use commercially reasonable efforts to cooperate
with the other party to that end.

(b)              Certain Notifications Until Closing.  From the Signing Date
until the Closing, the Company shall promptly notify the Investor of (i) any
fact, event or circumstance of which it is aware and which would reasonably be
expected to cause any representation or warranty of the Company contained in
this Agreement to be untrue or inaccurate in any material respect or to cause
any covenant or agreement of the Company contained in this Agreement not to be
complied with or satisfied in any material respect and (ii) except as Previously
Disclosed, any fact, circumstance, event, change, occurrence, condition or
development of which the Company is aware and which, individually or in the
aggregate, has had or would reasonably be expected to have a  Company Material
Adverse Effect; provided, however, that delivery of any notice pursuant to this
Section 4.1(b) shall not limit or affect any rights of or remedies available to
the Investor.

(c)              Access, Information and Confidentiality.

(i)               From the Signing Date until the date when the Investor owns an
amount of CDCI Preferred Shares having an aggregate liquidation value of less
than 10% of the aggregate liquidation value of the CDCI Preferred Shares as of
the Closing Date, the Company will permit the Investor and its agents,
consultants, contractors and advisors (A) acting through the Appropriate Federal
Banking Agency, or otherwise to the extent necessary to evaluate, manage, or
transfer its investment in the Company, to examine the corporate books, Tax
returns (including all schedules and attached thereto) and other information
reasonably requested by Investor relating to Taxes and make copies thereof and
to discuss the affairs, finances and accounts of the Company and the Company
Subsidiaries with the principal officers of the Company, all upon reasonable
notice and at such reasonable times and as often as the Investor may reasonably
request and (B) to review any information material to the Investor’s investment
in the Company provided by the Company to its Appropriate Federal Banking
Agency.  Any investigation pursuant to this Section 4.1(c) shall be conducted
during normal business hours and in such manner as not to interfere unreasonably
with the conduct of the business of the Company, and nothing herein shall
require the Company or any Company Subsidiary to disclose any information to the
Investor to the extent (x) prohibited by applicable law or regulation, or (y)
that such disclosure would reasonably be expected to cause a violation of any
agreement to which the Company or any Company Subsidiary is a party or would
cause a risk of a loss of privilege to the Company or any Company Subsidiary
(provided that the Company shall use commercially reasonable efforts to make
appropriate substitute disclosure arrangements under circumstances where the
restrictions in this clause (i) apply).

 
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(ii)              From the Signing Date until the date on which all of the CDCI
Preferred Shares have been redeemed in whole, the Company will deliver, or will
cause to be delivered, to the Investor:

(A)           as soon as available after the end of each fiscal year of the
Company, and in any event within 90 days thereafter, a consolidated balance
sheet of the Company as of the end of such fiscal year, and consolidated
statements of income, retained earnings and cash flows of the Company for such
year, in each case prepared in accordance with GAAP and setting forth in each
case in comparative form the figures for the previous fiscal year of the
Company, and which shall be audited to the extent audited financial statements
are available;

(B)           as soon as available after the end of the first, second and third
quarterly periods in each fiscal year of the Company, a copy of any quarterly
reports provided to other stockholders of the Company or Company management by
the Company;

(C)           as soon as available after the Company receives any assessment of
the Company’s internal controls, a copy of such assessment;

(D)           annually on a date specified by the Investor, a completed survey,
in a form specified by the Investor, providing, among other things, a
description of how the Company has utilized the funds the Company received in
connection with the sale of the CPP Preferred Shares and the effects of such
funds on the operations and status of the Company;

(E)           as soon as such items become effective, any amendments to the
Charter, bylaws or other organizational documents of the Company; and

(F)           at the same time as such items are sent to any stockholders of the
Company, copies of any information or documents sent by the Company to its
stockholders.

(iii)             The Investor will use reasonable best efforts to hold, and
will use reasonable best efforts to cause its agents, consultants, contractors
and advisors and United States executive branch officials and employees, to
hold, in confidence all non-public records, books, contracts, instruments,
computer data and other data and information (collectively, “Information”)
concerning the Company furnished or made available to it by the Company or its
representatives pursuant to this Agreement (except to the extent that such
information can be shown to have been (A) previously known by such party on a
non-confidential basis, (B) in the public domain through no fault of such party
or (C) later lawfully acquired from other sources by the party to which it was
furnished (and without violation of any other confidentiality obligation));
provided that nothing herein shall prevent the Investor from disclosing any
Information to the extent required by applicable laws or regulations or by any
subpoena or similar legal process.  The Investor understands that the
Information may contain commercially sensitive confidential information entitled
to an exception from a Freedom of Information Act request.

 
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(iv)             The Investor’s information rights pursuant to Section
4.1(c)(ii)(A), (B), (C), (E) and (F) and the Investor’s right to receive
certifications from the Company pursuant to Section 4.1(d)(ii) may be assigned
by the Investor to a transferee or assignee of the CDCI Preferred Shares with a
liquidation preference of no less than an amount equal to 2% of the initial
aggregate liquidation preference of the CDCI Preferred Shares.

(v)              From the Signing Date until the date when the Investor no
longer owns any CDCI Preferred Shares, the Company shall permit, and shall cause
each of the Company’s Subsidiaries to permit (A) the Investor and its agents,
consultants, contractors and advisors, (B) the Special Inspector General of the
Troubled Asset Relief Program, and (C) the Comptroller General of the United
States access to personnel and any books, papers, records or other data, in each
case, to the extent relevant to ascertaining compliance with the financing terms
and conditions; provided that prior to disclosing any information pursuant to
clause (B) or (C), the Special Inspector General of the Troubled Asset Relief
Program and the Comptroller General of the United States shall have agreed, with
respect to documents obtained under this Agreement in furtherance of its
function, to follow applicable law and regulation (and the applicable customary
policies and procedures) regarding the dissemination of confidential materials,
including redacting confidential information from the public version of its
reports and soliciting the input from the Company as to information that should
be afforded confidentiality, as appropriate.

(vi)             Nothing in this Section shall be construed to limit the
authority that the Special Inspector General of the Troubled Asset Relief
Program, the Comptroller General of the United States or any other applicable
regulatory authority has under law.

(d)              CDFI Requirements.

(i)                From the Signing Date until the date on which all of the CDCI
Preferred Shares have been redeemed in whole, each Certified Entity shall (A) be
certified by the Fund as a CDFI; (B) together with its Affiliates collectively
meet the eligibility requirements of 12 C.F.R. 1805.200(b); (C) have a primary
mission of promoting community development, as may be determined by Investor
from time to time, based on criteria set forth in 12 C.F.R. 1805.201(b)(1); (D)
provide Financial Products, Development Services, and/or other similar financing
as a predominant business activity in arm’s-length transactions; (E) serve a
Target Market by serving one or more Investment Areas and/or Targeted
Populations as may be determined by Investor from time to time, substantially in
the manner set forth in 12 C.F.R. 1805.201(b)(3); (F) provide Development
Services in conjunction with its Financial Products, directly, through an
Affiliate or through a contract with a third-party provider; (G) maintain
accountability to residents of the applicable Investment Area(s) or Targeted
Population(s) through representation on its governing Board of Directors or
otherwise; and (H) remain a non-governmental entity which is not an agency or
instrumentality of the United States of America, or any State or political
subdivision thereof, as described in 12 C.F.R. 1805.201(b)(6) and within the
meaning of any supplemental regulations or interpretations of 12 C.F.R.
1805.201(b)(6) or such supplemental regulations published by the
Fund.  Notwithstanding any other provision hereof, as used in this Section
4.1(d), the terms “Affiliates”; “Financial Products”; “Development Services”;
“Target Market”; “Investment Areas”; and “Targeted Populations” have the
meanings ascribed to such terms in 12 C.F.R. 1805.104.

 
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(ii)              From the Signing Date until the date on which all of the CDCI
Preferred Shares have been redeemed in whole, the Company shall deliver to
Investor (1)(x) on the date that is 180 days after the Closing Date and (y)
annually on the same date on which the Company delivers the documentation
required under Section 4.1(c)(ii)(A) to the Investor, a certificate signed on
behalf of the Company by a Senior Executive Officer, in substantially the form
attached hereto as Annex F, certifying (A) that the Company and each Certified
Entity remains in compliance with the covenants set forth in Section 4.1(d)(i);
(B) that the information in the CDFI Application, as modified by any updates to
the CDFI Application provided by the Company to the Investor on or prior to the
date of such certificate, with respect to the covenants set forth in Section
4.1(d)(i)(B) and Section 4.1(d)(i)(D) remains true, correct and complete as of
such date or, to the extent any information set forth in the CDFI Application,
as modified by any updates to the CDFI Application provided by the Company to
the Investor on or prior to the date of such certificate, with respect to such
covenants needs to be updated or supplanted to make it true, complete and
correct as of such date, that an updated narrative to the CDFI Application
setting forth any information necessary to make the information set forth in the
CDFI Application is true, complete and correct as of such date; (C) either (a)
that the contracts and material agreements entered into by each Certified Entity
with respect to Development Services previously disclosed to the Investor remain
in effect or (b) that attached are any new contracts and material agreements
entered into by the Certified Entity with respect to Development Services; (D) a
list of the names and addresses of the individuals which comprise the board of
directors of each Certified Entity as of such date and, to the extent any of
such individuals was not a member of the board of directors of such Certified
Entity as of the last certification to the Investor, a narrative describing such
individual's relationship to the applicable Investment Area(s) and Targeted
Population(s) or, if such Certified Entity maintains accountability to residents
of the applicable Investment Area(s) or Target Population(s) through means other
than representation on its governing board of directors and such means have
changed since the date of the last certification to the Investor, a narrative
describing such change; (E) that each Certified Entity is not an agency of the
United States of America, or any State or political subdivision thereof, as
described in 12 C.F.R. 1805.201(b)(6) and within the meaning of any supplemental
regulations or interpretations of 12 C.F.R. 1805.201(b)(6) or such supplemental
regulations published by the Fund and (F) that the Company remains in compliance
with the covenants set forth in Section 4.1(f) and Section 4.1(l) and (2) within
five (5) business days of receipt, copies of any notices, correspondence or
other written communication between each Certified Entity and the Fund,
including any form that such Certified Entity is required to provide to the Fund
due to the occurrence of a “Material Event” within the meaning of the Fund’s
CDFI Certification Procedures.

 
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(iii)             The Company shall immediately notify the Investor upon the
occurrence of any breach of any of the covenants set forth in Section 4.1(d).

(e)              Executive Compensation.

(i)               Benefit Plans.  During the Relevant Period, the Company shall
take all necessary action to ensure that the Benefit Plans of the Company and
its Affiliates comply in all respects with, and shall take all other actions
necessary to comply with, Section 111 of EESA, as implemented by the
Compensation Regulations, and neither the Company nor any of its Affiliates
shall adopt any new Benefit Plan (x) that does not comply therewith or (y) that
does not expressly state and require that such Benefit Plan and any compensation
thereunder shall be subject to any relevant Compensation Regulations adopted,
issued or released on or after the date any such Benefit Plan is adopted. To the
extent that EESA and/or the Compensation Regulations are amended or otherwise
change during the Relevant Period in a manner that requires changes to
then-existing Benefit Plans, or that requires other actions, the Company and its
Affiliates shall effect such changes to its or their Benefit Plans, and take
such other actions, as promptly as practicable after it has actual knowledge of
such amendments or changes in order to be in compliance with this Section 4.1(e)
(and shall be deemed to be in compliance for a reasonable period to effect such
changes).  In addition, the Company and its Affiliates shall take all necessary
action, other than to the extent prohibited by applicable law or regulation
applicable outside of the United States, to ensure that the consummation of the
transactions contemplated by this Agreement will not accelerate the vesting,
payment or distribution of any equity-based awards, deferred cash awards or any
nonqualified deferred compensation payable by the Company or any of its
Affiliates.

(ii)              Additional Waivers.  After the Closing Date, in connection
with the hiring or promotion of a Section 4.1(e) Employee and/or the
promulgation of applicable Compensation Regulations or otherwise, to the extent
any Section 4.1(e) Employee shall not have executed a waiver in a form
satisfactory to the Investor with respect to the application to such Section
4.1(e) Employee of the Compensation Regulations, the Company shall use its best
efforts to (x) obtain from such Section 4.1(e) Employee a waiver in
substantially the form attached hereto as Annex D and (y) deliver such waiver to
the Investor as promptly as possible, in each case within sixty days of such
Section 4.1(e) Employee becoming subject to the requirements of this Section.
“Section 4.1(e) Employee” means (A) each Senior Executive Officer and (B) any
other employee of the Company or any of its Affiliates determined at any time to
be subject to Section 111 of  EESA as implemented by the Compensation
Regulations.

 
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(iii)             Clawback.  In the event that any Section 4.1(e) Employee
receives a payment in contravention of the provisions of this Section 4.1(e),
the Company shall promptly provide such individual with written notice that the
amount of such payment must be repaid to the Company in full within fifteen
business days following receipt of such notice or such earlier time as may be
required by the Compensation Regulations and shall promptly inform the Investor
(x) upon discovering that a payment in contravention of this Section 4.1(e) has
been made and (y) following the repayment to the Company of such amount and
shall take such other actions as may be necessary to comply with the
Compensation Regulations.

(iv)             Limitation on Deductions.  During the Relevant Period, the
Company agrees that it shall not claim a deduction for remuneration for federal
income tax purposes in excess of $500,000 for each Senior Executive Officer that
would not be deductible if Section 162(m)(5) of the Code applied to the Company.

(v)              Amendment to Prior Agreement.  The parties agree that,
effective as of the date hereof, Section 4.10 of the CPP Securities Purchase
Agreement shall be amended in its entirety by replacing such Section 4.10 with
the provisions set forth in this Section 4.1(e) and any terms included in this
Section 4.1(e) that are not otherwise defined in the CPP Securities Purchase
Agreement shall have the meanings ascribed to such terms in this Agreement.

(f)               Bank or Savings and Loan Holding Company Status.

 If the Company is a Bank Holding Company or a Savings and Loan Holding Company
on the Signing Date, then the Company shall maintain its status as a Bank
Holding Company or Savings and Loan Holding Company, as the case may be, for as
long as the Investor owns any CDCI Preferred Shares.  The Company shall redeem
all CDCI Preferred Shares held by the Investor prior to terminating its status
as a Bank Holding Company or Savings and Loan Holding Company, as applicable.

(g)              Predominantly Financial.  For as long as the Investor owns any
CDCI Preferred Shares, the Company, to the extent it is not itself an insured
depository institution, agrees to remain predominantly engaged in financial
activities.  A company is predominantly engaged in financial activities if the
annual gross revenues derived by the company and all subsidiaries of the company
(excluding revenues derived from subsidiary depository institutions), on a
consolidated basis, from engaging in activities that are financial in nature or
are incidental to a financial activity under subsection (k) of Section 4 of the
Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)) represent at least 85
percent of the consolidated annual gross revenues of the company.

(h)              Capital Covenant.  From the Signing Date until the date on
which all of the CDCI Preferred Shares have been redeemed in whole, the Company
and the Company Subsidiaries shall maintain such capital as may be necessary to
meet the minimum capital requirements of the Appropriate Federal Banking Agency,
as in effect from time to time.

 
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(i)               HAMP Modifications.  The Company shall take all necessary
action to ensure that (i) from and after the date the Company or any Company
Subsidiary that services residential mortgage loans has 100 or more residential
mortgage loans not owned or guaranteed by Fannie Mae or Freddie Mac which have
been past due for 60 or more days, the Company or such Company Subsidiary shall,
to the extent such programs are open for participation, (A) participate in the
United States Department of the Treasury’s Making Home Affordable (“MHA”)
program, including MHA’s Second Lien Modification Program and, (B) immediately
execute a Commitment to Purchase Financial Instrument and Servicer Participation
Agreement (in such form as may be set forth on the MHA website at
www.hmpadmin.com from time to time) with Fannie Mae (acting as the United States
Department of the Treasury’s fiscal agent) and (ii) if the Company or any
Company Subsidiary owns mortgage loans that are serviced by a non-affiliated
mortgage servicer, the Company or such Company Subsidiary shall consent to any
MHA modification request made by such mortgage servicer.

(j)               Reporting Requirements.  Prior to the date on which all of the
CDCI Preferred Shares have been redeemed in whole, the Company covenants and
agrees that, at all times on or after the Closing Date, (i) to the extent it is
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, it shall comply with the terms and conditions set forth in Annex E or (ii)
as soon as practicable after the date that the Company becomes subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, it shall
comply with the terms and conditions set forth in Annex E.

(k)              Compliance with Employ American Workers Act.  The Company shall
agree to comply, and take all necessary action to ensure that any Company
Subsidiary complies in all respects with the provisions of EESA and any federal
law respecting EESA, including the Employ American Workers Act (Section 1611 of
Division A, Title XVI of the American Recovery and Reinvestment Act of 2009),
Public Law No. 111-5, effective as of February 17, 2009, as implemented by any
rules, regulation or guidance thereunder, as such may be amended or supplemented
from time to time, and any applicable guidance of the United States Department
of the Treasury with respect thereto.

(l)               Control by Foreign Bank or Company.  Prior to the date on
which all of the CDCI Preferred Shares have been redeemed in whole, the Company
shall not be controlled (within the meaning of the Bank Holding Company Act of
1956 (12 U.S.C. 1841(a)(2)) and 12 C.F.R. 225(a)(i) in the case of Bank Holding
Companies and banks and the Home Owners’ Loan Act of 1933 (12 U.S.C. 1467a
(a)(2)) and 12 C.F.R. 583.7 in the case of Savings and Loan Holding Companies
and savings associations) by a foreign bank or company.

Section 4.2            Negative Covenants.  The Company hereby covenants and
agrees with the Investor that:

(a)               Certain Transactions.

(i)               The Company shall not merge or consolidate with, or sell,
transfer or lease all or substantially all of its property or assets to, any
other party unless the successor, transferee or lessee party (or its ultimate
parent entity), as the case may be (if not the Company), expressly assumes the
due and punctual performance and observance of each and every covenant,
agreement and condition of this Agreement to be performed and observed by the
Company.

 
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(ii)              Without the prior written consent of the Investor, until such
time as the Investor shall cease to own any debt or equity securities of the
Company acquired pursuant to this Agreement or the CPP Securities Purchase
Agreement (including, for the avoidance of doubt, the CPP Preferred Shares or
the CDCI Preferred Shares), the Company shall not permit any of its “significant
subsidiaries” (as such term is defined in Rule 12b-2 promulgated under the
Exchange Act) to (i) engage in any merger, consolidation, statutory share
exchange or similar transaction following the consummation of which such
significant subsidiary is not wholly-owned by the Company, (ii) dissolve or sell
all or substantially all of its assets or property other than in connection with
an internal reorganization or consolidation involving wholly-owned subsidiaries
of the Company or (iii) issue or sell any shares of its capital stock or any
securities convertible or exercisable for any such shares, other than issuances
or sales in connection with an internal reorganization or consolidation
involving wholly-owned subsidiaries of the Company.

(b)              Restriction on Dividends and Repurchases.

(i)               The Company covenants and agrees that it shall not violate any
of the restrictions on dividends, distributions, redemptions, repurchases,
acquisitions and related actions set forth in the New Certificate of
Designations, which are incorporated by reference herein as if set forth in
full.

(ii)              During the period beginning on the eighth anniversary of the
Closing and ending on the date on which the Investor no longer owns any of the
CDCI Preferred Shares, neither the Company nor any Company Subsidiary shall,
without the consent of the Investor, (A) declare or pay any dividend or make any
distribution on capital stock or other equity securities of any kind of the
Company or any Company Subsidiary; or (B) redeem, purchase or acquire any shares
of Common Stock or other capital stock or other equity securities of any kind of
the Company or any Company Subsidiary, or any trust preferred securities issued
by the Company or any Affiliate of the Company, other than (1) redemptions,
purchases or other acquisitions of the CDCI Preferred Shares, (2) regular
dividends on shares of preferred stock in accordance with the terms thereof and
which are permitted under the terms of the CDCI Preferred Shares, or (3)
dividends or distributions by any wholly-owned Company Subsidiary.

(c)              Related Party Transactions.  Until such time as the Investor
ceases to own any debt or equity securities of the Company, including the CDCI
Preferred Shares, the Company and the Company Subsidiaries shall not enter into
transactions with Affiliates or related persons (within the meaning of Item 404
under the SEC’s Regulation S-K) unless (A) such transactions are on terms no
less favorable to the Company and the Company Subsidiaries than could be
obtained from an unaffiliated third party, and (B) have been approved by the
audit committee of the Board of Directors or comparable body of independent
directors of the Company, or if there are no independent directors, the Board of
Directors, provided that the Board of Directors shall maintain written
documentation which supports its determination that the transaction meets the
requirements of clause (A) of this Section 4.2(c).

 
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(d)              Restriction on Repurchase of CDCI Preferred Shares Not Held by
Investor.  Prior to the date on which the Investor no longer owns any of the
CDCI Preferred Shares the Company shall not repurchase, redeem, call or
otherwise reacquire any CDCI Preferred Shares from any holder thereof, whether
by means of open market purchase, negotiated transaction, or otherwise, unless
it offers to repurchase, redeem, call or otherwise reacquire a ratable portion
of the CDCI Preferred Shares, as the case may be, then held by the Investor on
the same terms and conditions.

ARTICLE V

ADDITIONAL AGREEMENTS

Section 5.1            Purchase for Investment.  The Investor acknowledges that
the CDCI Preferred Shares have not been registered under the Securities Act or
under any state securities laws. The Investor (a) is acquiring the CDCI
Preferred Shares pursuant to an exemption from registration under the Securities
Act solely for investment with no present intention to distribute them to any
person in violation of the Securities Act or any applicable U.S. state
securities laws, (b) will not sell or otherwise dispose of any of the CDCI
Preferred Shares, except in compliance with the registration requirements or
exemption provisions of the Securities Act and any applicable U.S. state
securities laws, and (c) has such knowledge and experience in financial and
business matters and in investments of this type that it is capable of
evaluating the merits and risks of the Exchange and of making an informed
investment decision.

Section 5.2            Legends.  (a) The Investor agrees that all certificates
or other instruments representing the CDCI Preferred Shares will bear a legend
substantially to the following effect:

“THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE NOT SAVINGS ACCOUNTS,
DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND ARE NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES
LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH
ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF THE SECURITIES
REPRESENTED BY THIS INSTRUMENT IS NOTIFIED THAT THE SELLER MAY BE RELYING ON THE
EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.  ANY TRANSFEREE OF THE SECURITIES REPRESENTED BY THIS INSTRUMENT BY
ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL
BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT IT
WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY THIS
INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT WHICH IS THEN
EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS THE SECURITIES
REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO
A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE ISSUER OR (D)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THE
SECURITIES REPRESENTED BY THIS INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND.

 
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THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER
PROVISIONS OF AN EXCHANGE AGREEMENT BETWEEN THE ISSUER OF THESE SECURITIES AND
THE INVESTOR REFERRED TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE
ISSUER.  THE SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENT.  ANY SALE OR
OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT WILL BE VOID.”

(b)              In the event that any CDCI Preferred Shares (i) become
registered under the Securities Act or (ii) are eligible to be transferred
without restriction in accordance with Rule 144 or another exemption from
registration under the Securities Act (other than Rule 144A), the Company shall
issue new certificates or other instruments representing such CDCI Preferred
Shares, which shall not contain the applicable legends in Section 5.2(a) above;
provided that the Investor surrenders to the Company the previously issued
certificates or other instruments.

 
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Section 5.3            Transfer of CDCI Preferred Shares.  Subject to compliance
with applicable securities laws, the Investor shall be permitted to transfer,
sell, assign or otherwise dispose of (“Transfer”) all or a portion of the CDCI
Preferred Shares at any time, and the Company shall take all steps as may be
reasonably requested by the Investor to facilitate the Transfer of the CDCI
Preferred Shares, including without limitation, as set forth in Section 5.4,
provided that the Investor shall not Transfer any CDCI Preferred Shares if such
transfer would require the Company to be subject to the periodic reporting
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 (the
“Exchange Act”) and the Company was not already subject to such
requirements.  In furtherance of the foregoing, the Company shall provide
reasonable cooperation to facilitate any Transfers of the CDCI Preferred Shares,
including, as is reasonable under the circumstances, by furnishing such
information concerning the Company and its business as a proposed transferee may
reasonably request and making management of the Company reasonably available to
respond to questions of a proposed transferee in accordance with customary
practice, subject in all cases to the proposed transferee agreeing to a
customary confidentiality agreement.

Section 5.4             Rule 144; Rule 144A; 4(1½) Transactions.  (a) At all
times after the Signing Date, the Company covenants that (1) it will, upon the
request of the Investor or any subsequent holders of the CDCI Preferred Shares
(“Holders”), use its reasonable best efforts to (x), to the extent any Holder is
relying on Rule 144 under the Securities Act to sell any of the CDCI Preferred
Shares, make “current public information” available, as provided in Section
(c)(1) of Rule 144 (if the Company is a “Reporting Issuer” within the meaning of
Rule 144) or in Section (c)(2) of Rule 144 (if the Company is a “Non-Reporting
Issuer” within the meaning of Rule 144), in either case for such time period as
necessary to permit sales pursuant to Rule 144, (y), to the extent any Holder is
relying on the so-called “Section 4(1½)” exemption to sell any of its CDCI
Preferred Shares, prepare and provide to such Holder such information, including
the preparation of private offering memoranda or circulars or financial
information, as the Holder may reasonably request to enable the sale of the CDCI
Preferred Shares pursuant to such exemption, or (z) to the extent any Holder is
relying on Rule 144A under the Securities Act to sell any of its CDCI Preferred
Shares, prepare and provide to such Holder the information required pursuant to
Rule 144A(d)(4), and (2) it will take such further action as any Holder may
reasonably request from time to time to enable such Holder to sell CDCI
Preferred Shares without registration under the Securities Act within the
limitations of the exemptions provided by (i) the provisions of the Securities
Act or any interpretations thereof or related thereto by the SEC, including
transactions based on the so-called “Section 4(1½)” and other similar
transactions, (ii) Rule 144 or 144A under the Securities Act, as such rules may
be amended from time to time, or (iii) any similar rule or regulation hereafter
adopted by the SEC; provided that the Company shall not be required to take any
action described in this Section 5.4(a) that would cause the Company to become
subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act
if the Company was not subject to such requirements prior to taking such
action.  Upon the request of any Holder, the Company will deliver to such Holder
a written statement as to whether it has complied with such requirements and, if
not, the specifics thereof.

 
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(b)             The Company agrees to indemnify Investor, Investor’s officers,
directors, employees, agents, representatives and Affiliates, and each person,
if any, that controls Investor within the meaning of the Securities Act (each,
an “Indemnitee”), against any and all losses, claims, damages, actions,
liabilities, costs and expenses (including reasonable fees, expenses and
disbursements of attorneys and other professionals incurred in connection with
investigating, defending, settling, compromising or paying any such losses,
claims, damages, actions, liabilities, costs and expenses), joint or several,
arising out of or based upon any untrue statement or alleged untrue statement of
material fact contained in any document or report provided by the Company
pursuant to this Section 5.4 or any omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.

(c)              If the indemnification provided for in Section 5.4(b) is
unavailable to an Indemnitee with respect to any losses, claims, damages,
actions, liabilities, costs or expenses referred to therein or is insufficient
to hold the Indemnitee harmless as contemplated therein, then the Company, in
lieu of indemnifying such Indemnitee, shall contribute to the amount paid or
payable by such Indemnitee as a result of such losses, claims, damages, actions,
liabilities, costs or expenses in such proportion as is appropriate to reflect
the relative fault of the Indemnitee, on the one hand, and the Company, on the
other hand, in connection with the statements or omissions which resulted in
such losses, claims, damages, actions, liabilities, costs or expenses as well as
any other relevant equitable considerations.  The relative fault of the Company,
on the one hand, and of the Indemnitee, on the other hand, shall be determined
by reference to, among other factors, whether the untrue statement of a material
fact or omission to state a material fact relates to information supplied by the
Company or by the Indemnitee and the parties’ relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission;  the Company and Investor agree that it would not be just and
equitable if contribution pursuant to this Section 5.4(c) were determined by pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in Section 5.4(b).  No Indemnitee
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from the Company if the
Company was not guilty of such fraudulent misrepresentation.

Section 5.5            Depositary Shares.  Upon request by the Investor at any
time following the Closing Date, the Company shall promptly enter into a
depositary arrangement, pursuant to customary agreements reasonably satisfactory
to the Investor and with a depositary reasonably acceptable to the Investor,
pursuant to which the CDCI Preferred Shares may be deposited and depositary
shares, each representing a fraction of a CDCI Preferred Share, as specified by
the Investor, may be issued. From and after the execution of any such depositary
arrangement, and the deposit of any CDCI Preferred Shares, as applicable,
pursuant thereto, the depositary shares issued pursuant thereto shall be deemed
“CDCI Preferred Shares” and, as applicable, “Registrable Securities” for
purposes of this Agreement.

Section 5.6            Expenses and Further Assurances.  (a) Unless otherwise
provided in this Agreement, each of the parties hereto will bear and pay all
costs and expenses incurred by it or on its behalf in connection with the
transactions contemplated under this Agreement, including fees and expenses of
its own financial or other consultants, investment bankers, accountants and
counsel.

 
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(b)              The Company shall, at the Company’s sole cost and expense, (i)
furnish to the Investor all instruments, documents and other agreements required
to be furnished by the Company pursuant to the terms of this Agreement,
including, without limitation, any documents required to be delivered pursuant
to Section 5.4 above, or which are reasonably requested by the Investor in
connection therewith; (ii) execute and deliver to the Investor such documents,
instruments, certificates, assignments and other writings, and do such other
acts necessary or desirable, to evidence, preserve and/or protect the CDCI
Preferred Shares purchased by the Investor, as Investor may reasonably require;
and (iii) do and execute all and such further lawful and reasonable acts,
conveyances and assurances for the better and more effective carrying out of the
intents and purposes of this Agreement, as the Investor shall reasonably require
from time to time.

Section 5.7            Repurchase of Investor Securities.  From and after the
date of this Agreement, the agreements set forth in Section 4.9 of the CPP
Securities Purchase Agreement shall be applicable following the redemption in
whole of the CDCI Preferred Shares held by the Investor or the Transfer by the
Investor of all of the CDCI Preferred Shares held by the Investor to one or more
third parties not affiliated with the Investor.

ARTICLE VI
 
MISCELLANEOUS

Section 6.1            Termination.  This Agreement shall terminate upon the
earliest to occur of:

(a)              termination at any time prior to the Closing:

(i)               by either the Investor or the Company if the Closing shall not
have occurred by the 30th calendar day following the Signing Date; provided,
however, that in the event the Closing has not occurred by such 30th calendar
day, the parties will consult in good faith to determine whether to extend the
term of this Agreement, it being understood that the parties shall be required
to consult only until the fifth calendar day after such 30th calendar day and
not be under any obligation to extend the term of this Agreement thereafter;
provided, further, that the right to terminate this Agreement under this Section
6.1(a)(i) shall not be available to any party whose breach of any representation
or warranty or failure to perform any obligation under this Agreement shall have
caused or resulted in the failure of the Closing to occur on or prior to such
date; or

(ii)              by either the Investor or the Company in the event that any
Governmental Entity shall have issued an order, decree or ruling or taken any
other action restraining, enjoining or otherwise prohibiting the transactions
contemplated by this Agreement, and such order, decree, ruling or other action
shall have become final and nonappealable; or

 
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(iii)              by the mutual written consent of the Investor and the
Company; or

(b)              the date on which all of the CDCI Preferred Shares have been
redeemed in whole; or

(c)              the date on which the Investor has transferred all of the CDCI
Preferred Shares to third parties which are not Affiliates of the Investor; or

(d)              if the Closing shall not have occurred by September 30, 2010,
on such date.
 
In the event of termination of this Agreement as provided in this Section 6.1,
this Agreement shall forthwith become void and there shall be no liability on
the part of either party hereto except that nothing herein shall relieve either
party from liability for any breach of this Agreement.

Section 6.2            Survival.  (a) This Agreement and all representations,
warranties, covenants and agreements made herein shall survive the Closing
without limitation.

(b)           The covenants set forth in Article IV and Annex E and the
agreements set forth in Article V shall, to the extent such covenants do not
explicitly terminate at such time as the Investor no longer owns any CDCI
Preferred Shares, survive the termination of this Agreement pursuant to Section
6.1(c) hereof without limitation until the date on which all of the CDCI
Preferred Shares have been redeemed in whole.

Section 6.3            Amendment.  No amendment of any provision of this
Agreement will be effective unless made in writing and signed by an officer or a
duly authorized representative of each of the Company and the Investor; provided
that for so long as the CDCI Preferred Shares are outstanding, the Investor may
at any time and from time to time unilaterally amend Section 4.1(d) to the
extent the Investor deems necessary, in its sole discretion, to comply with, or
conform to, any changes after the Signing Date in any federal statutes, any
rules and regulations promulgated thereunder and any other publications or
interpretative releases of the Fund governing CDFIs, including, without
limitation, any changes in the criteria for certification as a CDFI by the
Fund.  No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise of any other
right, power or privilege.  The rights and remedies herein provided shall be
cumulative of any rights or remedies provided by law.

Section 6.4            Waiver of Conditions.  The conditions to each party’s
obligation to consummate the Exchange are for the sole benefit of such party and
may be waived by such party in whole or in part to the extent permitted by
applicable law.  No waiver will be effective unless it is in a writing signed by
a duly authorized officer of the waiving party that makes express reference to
the provision or provisions subject to such waiver.

Section 6.5            Governing Law; Submission to Jurisdiction, etc.  This
Agreement and any claim, controversy or dispute arising under or related to this
Agreement, the relationship of the parties, and/or the interpretation and
enforcement of the rights and duties of the parties shall be enforced, governed,
and construed in all respects (whether in contract or in tort) in accordance
with the federal law of the United States if and to the extent such law is
applicable, and otherwise in accordance with the laws of the State of New York
applicable to contracts made and to be performed entirely within such
State.  Each of the parties hereto agrees (a) to submit to the exclusive
jurisdiction and venue of the United States District Court for the District of
Columbia and the United States Court of Federal Claims for any and all civil
actions, suits or proceedings arising out of or relating to this Agreement or
the Exchange contemplated hereby and (b) that notice may be served upon (i) the
Company at the address and in the manner set forth for notices to the Company in
Section 6.6 and (ii) the Investor at the address and in the manner set forth for
notices to the Company in Section 6.6, but otherwise in accordance with federal
law.  TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HERETO
HEREBY UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY CIVIL LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR THE EXCHANGE CONTEMPLATED HEREBY.

 
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Section 6.6            Notices.  Any notice, request, instruction or other
document to be given hereunder by any party to the other will be in writing and
will be deemed to have been duly given (a) on the date of delivery if delivered
personally, or by facsimile, upon confirmation of receipt, or (b) on the second
business day following the date of dispatch if delivered by a recognized next
day courier service.  All notices hereunder shall be delivered as set forth
below or pursuant to such other instructions as may be designated in  writing by
the party to receive such notice.

If to the Company as set forth in Schedule A.

If to the Investor:
 
United States Department of the Treasury

1500 Pennsylvania Avenue, NW

Washington, D.C. 20220

Attention:  Chief Counsel, Office of Financial Stability
Facsimile: (202) 927-9225
E-mail: CDCINotice@do.treas.gov

with a copy to:

E-mail:  OFSChiefCounselNotices@do.treas.gov

Section 6.7            Definitions, Interpretation.

(a)              Definitions.

(i)               When a reference is made in this Agreement to a subsidiary of
a person, the term “subsidiary” means any corporation, partnership, joint
venture, limited liability company or other entity (x) of which such person or a
subsidiary of such person is a general partner or (y) of which a majority of the
voting securities or other voting interests, or a majority of the securities or
other interests of which having by their terms ordinary voting power to elect a
majority of the board of directors or persons performing similar functions with
respect to such entity, is directly or indirectly owned by such person and/or
one or more subsidiaries thereof.

 
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(ii)              The term “Affiliate” means, with respect to any person, any
person directly or indirectly controlling, controlled by or under common control
with, such other person.  For purposes of this definition, “control” (including,
with correlative meanings, the terms “controlled by” and “under common control
with”) when used with respect to any person, means the possession, directly or
indirectly, of the power to cause the direction of management and/or policies of
such person, whether through the ownership of voting securities by contract or
otherwise.

(iii)              The term “Appropriate Federal Banking Agency” means the
“appropriate Federal banking agency” with respect to the Company or such Company
Subsidiaries, as applicable, as defined in Section 3(q) of the Federal Deposit
Insurance Act (12 U.S.C. Section 1813(q)).

(iv)             The term “Bank Holding Company” means a company registered as
such with the Board of Governors of the Federal Reserve System (the “Federal
Reserve”) pursuant to 12 U.S.C. §1842 and the regulations of the Federal Reserve
promulgated thereunder.

(v)              The term “Business Combination” means a merger, consolidation,
statutory share exchange or similar transaction that requires the approval of
the Company’s stockholders.

(vi)             The term “Certified Entity” means the Company or, if the
Company itself has not been certified by the Fund as a CDFI, each Affiliate of
the Company that has been certified by the CDFI and is specified on Schedule A
of the Letter Agreement.

(vii)            The term “Company Financial Statements” means the consolidated
financial statements of the Company and its consolidated subsidiaries for each
of the last three completed fiscal years of the Company (which shall be audited
to the extent audited financial statements are available) and each completed
quarterly period since the last completed fiscal year, required to be delivered
to Investor pursuant to the CPP Securities Purchase Agreement.

(viii)           The term “Company Material Adverse Effect” means a material
adverse effect on (i) the business, results of operation or financial condition
of the Company and its consolidated subsidiaries and each Certified Entity taken
as a whole; provided, however, that Company Material Adverse Effect shall not be
deemed to include the effects of (A) changes after the Signing Date in general
business, economic or market conditions (including changes generally in
prevailing interest rates, credit availability and liquidity, currency exchange
rates and price levels or trading volumes in the United States or foreign
securities or credit markets), or any outbreak or escalation of hostilities,
declared or undeclared acts of war or terrorism, in each case generally
affecting the industries in which the Company and its subsidiaries operate, (B)
changes or proposed changes after the Signing Date in GAAP, or authoritative
interpretations thereof, or (C) changes or proposed changes after the Signing
Date in securities, banking and other laws of general applicability or related
policies or interpretations of Governmental Entities (in the case of each of
these clauses (A), (B) and (C), other than changes or occurrences to the extent
that such changes or occurrences have or would reasonably be expected to have a
materially disproportionate adverse effect on the Company and its consolidated
subsidiaries taken as a whole relative to comparable U.S. banking or financial
services organizations); or (ii) the ability of the Company to consummate the
Exchange and the other transactions contemplated by this Agreement and perform
its obligations hereunder or thereunder on a timely basis.

 
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(ix)             The term “Designated Matters” means (i) the election and
removal of directors, (ii) the approval of any Business Combination, (iii) the
approval of a sale of all or substantially all of the assets or property of the
Company, (iv) the approval of a dissolution of the Company, (v) the approval of
any issuance of any securities of the Company on which holders of Common Stock
are entitled to vote, (vi) the approval of any amendment to the Charter or
bylaws of the Company on which holders of Common Stock are entitled to vote,
(vii) any matters which require stockholder approval under any applicable
national stock exchange rules and (viii) the approval of any other matters
reasonably incidental to the matters set forth in subclauses (i) through (vii)
as determined by the Investor.

(x)              The term “Disclosure Schedule” means collectively, those
certain schedules delivered to the Investor on or prior to (i) the CPP Signing
Date, with respect to the “Disclosure Schedule” delivered in connection with the
CPP Securities Purchase Agreement and (ii) the Signing Date with respect to the
schedules required to be delivered under this Agreement, setting forth, among
other things, items the disclosure of which is necessary or appropriate either
in response to an express disclosure requirement contained in a provision hereof
or as an exception to one or more representations or warranties contained in
Section 2.2 of the CPP Securities Purchase Agreement or Article III hereof.

(xi)              The term “EAWA” means the Employ American Workers Act (Section
1611 of Division A, Title XVI of the American Recovery and Reinvestment Act of
2009), Public Law No. 111-5, effective as of February 17, 2009, as may be
amended and in effect from time to time.

(xii)            The term “Junior Stock” means the Common Stock and any other
class or series of stock of the Company the terms of which expressly provide
that it ranks junior to the CDCI Preferred Shares as to dividend rights and/or
as to rights on liquidation, dissolution or winding up of the Company.

(xiii)           The term “Parity Stock” means any class or series of stock of
the Company the terms of which do not expressly provide that such class or
series will rank senior or junior to the CDCI Preferred Shares as to dividend
rights and/or as to rights on liquidation, dissolution or winding up of the
Company (in each case without regard to whether dividends accrue cumulatively or
non-cumulatively).

 
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(xiv)           The term “Previously Disclosed” means information set forth on
the Disclosure Schedule or the Disclosure Update, as applicable; provided,
however, that disclosure in any section of such Disclosure Schedule or
Disclosure Update, as applicable, shall apply only to the indicated section of
this Agreement except to the extent that it is reasonably apparent from the face
of such disclosure that such disclosure is relevant to another section of this
Agreement; provided, further, that the existence of Previously Disclosed
information, pursuant to a Disclosure Update, shall neither obligate the
Investor to consummate the Exchange nor limit or affect any rights of or
remedies available to the Investor.

(xv)             The term “Savings and Loan Holding Company” means a company
registered as such with the Office of Thrift Supervision pursuant to 12 U.S.C.
§1467(a) and the regulations of the Office of Thrift Supervision promulgated
thereunder.

(xvi)            The term “Senior Executive Officers” means the Company's
“senior executive officers” as defined in Section 111 of the EESA and the
Compensation Regulations.

(xvii)           The term “Share Dilution Amount” means the increase in the
number of diluted shares outstanding (determined in accordance with GAAP, and as
measured from the date of the Company’s most recent consolidated financial
statements prior to the Closing Date) resulting from the grant, vesting or
exercise of equity-based compensation to employees and equitably adjusted for
any stock split, stock dividend, reverse stock split, reclassification or
similar transaction.

(xviii)         The term “Tax” or “Taxes” means any federal, state, local or
foreign income, gross receipts, property, sales, use, license, excise,
franchise, employment, payroll, withholding, alternative or add on minimum, ad
valorem, transfer or excise tax, or any other tax, custom, duty, governmental
fee or other like assessment or charge of any kind whatsoever, together with any
interest, penalty or addition imposed by any Governmental Entity.

(xix)            To the extent any securities issued pursuant to this Agreement
or the transactions contemplated hereby are registered in the name of a designee
of the Investor pursuant to Section 1.2 or Section 6.9(c) or transferred to an
Affiliate of the Investor, all references herein to the Investor holding or
owning any debt or equity securities of the Company, CDCI Preferred Shares shall
be deemed to refer to the Investor, together with such designees and/or
Affiliates, holding or owning any debt or equity securities, CDCI Preferred
Shares (and any like variations thereof), as applicable.

Section 6.8            Interpretation.  When a reference is made in this
Agreement to “Recitals”, “Articles”, “Sections”, “Annexes” or “Schedules” such
reference shall be to a Recital, Article or Section of, or Annex or Schedule to,
this Agreement, unless otherwise indicated.  The terms defined in the singular
have a comparable meaning when used in the plural, and vice versa.  References
to “herein”, “hereof”, “hereunder” and the like refer to this Agreement as a
whole and not to any particular section or provision, unless the context
requires otherwise.  The table of contents and headings contained in this
Agreement are for reference purposes only and are not part of this
Agreement.  Whenever the words “include”, “includes” or “including” are used in
this Agreement, they shall be deemed followed by the words “without limitation.”
No rule of construction against the draftsperson shall be applied in connection
with the interpretation or enforcement of this Agreement, as this Agreement is
entered into between sophisticated parties advised by counsel.  All references
to “$” or “dollars” mean the lawful currency of the United States of
America.  Except as expressly stated in this Agreement, all references to any
statute, rule or regulation are to the statute, rule or regulation as amended,
modified, supplemented or replaced from time to time (and, in the case of
statutes, include any rules and regulations promulgated under the statute) and
to any section of any statute, rule or regulation include any successor to the
section.  References to a “business day” shall mean any day except Saturday,
Sunday and any day on which banking institutions in the State of New York or the
District of Columbia generally are authorized or required by law or other
governmental actions to close.

 
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Section 6.9            Assignment.  Neither this Agreement nor any right,
remedy, obligation nor liability arising hereunder or by reason hereof shall be
assignable by any party hereto without the prior written consent of the other
party, and any attempt to assign any right, remedy, obligation or liability
hereunder without such consent shall be void, except (a) an assignment, in the
case of a merger, consolidation, statutory share exchange or similar transaction
that requires the approval of the Company’s stockholders where such party is not
the surviving entity, or a sale of substantially all of its assets, to the
entity which is the survivor of such Business Combination or the purchaser in
such sale, (b) an assignment of certain rights as provided in Sections 4.1(c) or
4.1(j) or Annex E or (c) an assignment by the Investor of this Agreement to an
Affiliate of the Investor; provided that if the Investor assigns this Agreement
to an Affiliate, the Investor shall be relieved of its obligations under this
Agreement but (i) all rights, remedies and obligations of the Investor hereunder
shall continue and be enforceable by such Affiliate, (ii) the Company’s
obligations and liabilities hereunder shall continue to be outstanding and (iii)
all references to the Investor herein shall be deemed to be references to such
Affiliate.

Section 6.10          Severability.  If any provision of this Agreement, or the
application thereof to any person or circumstance, is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.  Upon such determination, the parties shall
negotiate in good faith in an effort to agree upon a suitable and equitable
substitute provision to effect the original intent of the parties.

Section 6.11          No Third-Party Beneficiaries.  Other than as expressly
provided herein, nothing contained in this Agreement, expressed or implied, is
intended to confer upon any person or entity other than the Company and the
Investor (and any Indemnitee) any benefit, right or remedies.

Section 6.12          Entire Agreement, etc.  (a) This Agreement (including the
Annexes and Schedules hereto) constitutes the entire agreement, and supersedes
all other prior agreements, understandings, representations and warranties, both
written and oral, between the parties, with respect to the subject matter
hereof.

 
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(b)              For the avoidance of doubt, for so long as the Investor holds
any outstanding CPP Preferred Stock or warrants issued by the Company to the
Investor pursuant to the CPP Securities Purchase Agreement or any securities
issuable upon the exercise thereof or exchanged therefor (collectively, the “CPP
Securities”), the CPP Securities Purchase Agreement and the CPP Securities shall
remain in full force and effect, other than as specifically modified herein.

Section 6.13          Specific Performance.  The parties agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms.  It is accordingly
agreed that the parties shall be entitled (without the necessity of posting a
bond) to specific performance of the terms hereof, this being in addition to any
other remedies to which they are entitled at law or equity.

[Remainder of Page Intentionally Left Blank]

 
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ANNEX A

FORM OF OFFICER’S CERTIFICATE

OFFICER’S CERTIFICATE

OF

[COMPANY]

In connection with that certain letter agreement, dated [____________], 2010
(the “Agreement”) by and between [COMPANY] (the “Company”) and the United States
Department of the Treasury which incorporates that certain Exchange Agreement –
Standard Terms referred to therein (the “Standard Terms”), the undersigned does
hereby certify as follows:

1.                I am a duly elected/appointed [____________] of the Company.

2.                The representations and warranties of the Company set forth in
Article III of the Standard Terms are true and correct in all respects as though
as of the date hereof (other than representations and warranties that by their
terms speak as of another date, which representations and warranties shall be
true and correct in all respects as of such other date) and the Company has
performed in all material respects all obligations required to be performed by
it under the Agreement.

3.                The New Certificate of Designations, a true, complete and
correct copy of which is attached as Exhibit A hereto, has been filed with, and
accepted by, the Secretary of State of the State of [___________].

4.                The Company has effected such changes to its Benefit Plans
with respect to its Senior Executive Officers and any other employee of the
Company or its Affiliates subject to Section 111 of EESA, as implemented by any
Compensation Regulations (and to the extent necessary for such changes to be
legally enforceable, each of its Senior Executive Officers and other employees
has duly consented in writing to such changes), as may be necessary, during the
Relevant Period, in order to comply with Section 111 of EESA or the Compensation
Regulations.

5.                 The Charter and bylaws of the Company delivered to the
Investor pursuant to the CPP Securities Purchase Agreement are true, complete
and correct as of the date hereof.

The foregoing certifications are made and delivered as of [_________] pursuant
to Section 1.2 of the Standard Terms.

Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to them in the Standard Terms.

[SIGNATURE PAGE FOLLOWS]

 
Annex A-1

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IN WITNESS WHEREOF, this Officer’s Certificate has been duly executed and
delivered as of the [__] day of [__________], 20[__].

 
[COMPANY]
                 
By:
     
 
Name:
 
 
Title:

 
Annex A-2

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EXHIBIT A

 
Annex A-3

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ANNEX B

FORM OF NEW CERTIFICATE OF DESIGNATIONS

[SEE ATTACHED]

 
Annex B-1

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ANNEX C

FORM OF OPINION

(a)              The Company has been duly formed and is validly existing as a
[TYPE OF ORGANIZATION] and is in good standing under the laws of the
jurisdiction of its organization.  The Company has all necessary power and
authority to own, operate and lease its properties and to carry on its business
as it is being conducted.

(b)              The Company has been duly qualified as a foreign entity for the
transaction of business and is in good standing under the laws of
[_____________], [_____________] and [_____________].

(c)              The CDCI Preferred Shares have been duly and validly
authorized, and, when issued and delivered pursuant to the Agreement, the CDCI
Preferred Shares will be duly and validly issued and fully paid and
non-assessable, will not be issued in violation of any preemptive rights, and
will rank pari passu with or senior to all other series or classes of CDCI
Preferred Stock issued on the Closing Date with respect to the payment of
dividends and the distribution of assets in the event of any dissolution,
liquidation or winding up of the Company.

(d)              The Company has the corporate power and authority to execute
and deliver the Agreement and to carry out its obligations thereunder (which
includes the issuance of the CDCI Preferred Shares).

(e)              The execution, delivery and performance by the Company of the
Agreement and the consummation of the transactions contemplated thereby have
been duly authorized by all necessary corporate action on the part of the
Company and its stockholders, and no further approval or authorization is
required on the part of the Company, including, without limitation, by any rule
or requirement of any national stock exchange.

(f)               The Agreement is a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as the same
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting the enforcement of creditors’ rights generally and
general equitable principles, regardless of whether such enforceability is
considered in a proceeding at law or in equity.

(g)              The execution and delivery by the Company of the Agreement and
the performance by the Company of its obligations thereunder (i) do not require
any approval by any Governmental Entity to be obtained on the part of the
Company, except those that have been obtained, (ii) do not violate or conflict
with any provision of the Charter, (iii) do not violate, conflict with, or
result in a breach of any provision of, or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a default) under,
or result in the termination of, or accelerate the performance required by, or
result in a right of termination or acceleration of, or result in the creation
of, any lien, security interest, charge or encumbrance upon any of the
properties or assets of the Company or any Company Subsidiary under any of the
terms, conditions or provisions of its organizational documents or under any
agreement, contract, indenture, lease, mortgage, power of attorney, evidence of
indebtedness, letter of credit, license, instrument, obligation, purchase or
sales order, or other commitment, whether oral or written, to which it is a
party or by which it or any of its properties is bound or (iv) do not conflict
with, breach or result in a violation of, or default under any judgment, decree
or order known to us that is applicable to the Company and, pursuant to any
applicable laws, is issued by any Governmental Entity having jurisdiction over
the Company.

 
Annex C-1

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(h)              Other than the filing of the New Certificate of Designations
with the Secretary of State of its jurisdiction of organization or other
applicable Governmental Entity, such filings and approvals as are required to be
made or obtained under any state “blue sky” laws and such consents and approvals
that have been made or obtained, no notice to, filing with, exemption or review
by, or authorization, consent or approval of, any Governmental Entity is
required to be made or obtained by the Company in connection with the
consummation by the Company of the Exchange.

(i)               The Company is not nor, after giving effect to the issuance of
the CDCI Preferred Shares pursuant to the Agreement, would be on the date hereof
an “investment company” or an entity “controlled” by an “investment company,” as
such terms are defined in the Investment Company Act of 1940, as amended.

(j)               Each Certified Entity (A) is a regulated community development
financial institution (a “CDFI”) currently certified by the Community
Development Financial Institution Fund (the “Fund”) of the United States
Department of the Treasury pursuant to 12 C.F.R. 1805.201(a) and (B) satisfies
all of the eligibility requirements of the Fund’s Community Development
Financial Institutions Program for a CDFI.

 
Annex C-2

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ANNEX D

FORM OF WAIVER

In consideration for the benefits I will receive as a result of the
participation of [____________________] (together with its subsidiaries and
affiliates, the “Company”) in the United States Department of the Treasury’s
(the “Treasury”) Capital Purchase Program, Community Development Capital
Initiative and/or any other economic stabilization program implemented by the
Treasury under the Emergency Economic Stabilization Act of 2008 (as amended,
supplemented, or otherwise modified, the “EESA”) (any such program, including
the Capital Purchase Program and the Community Development Capital Initiative, a
“Program”), I hereby voluntarily waive any claim against the United States (and
each of its departments and agencies) or the Company or any of its directors,
officers, employees and agents for any changes to my compensation or benefits
that are required to comply with the executive compensation and corporate
governance requirements of Section 111 of the EESA, as implemented by any
guidance or regulations issued and/or to be issued thereunder, including without
limitation the provisions for the Capital Purchase Program, as implemented by
any guidance or regulation thereunder, including the rules set forth in 31
C.F.R. Part 30, or any other guidance or regulations under the EESA and the
applicable requirements of the Exchange Agreement by and among the Company and
the Treasury dated as of _______ __, 2010, as amended (such requirements, the
“Limitations”).

I acknowledge that the Limitations may require modification or termination of
the employment, compensation, bonus, incentive, severance, retention and other
benefit plans, arrangements, policies and agreements (including so-called
“golden parachute” agreements), whether or not in writing, that I may have with
the Company or in which I may participate as they relate to the period the
United States holds any equity or debt securities of the Company acquired
through a Program or for any other period applicable under such Program or
Limitations, as the case may be, and I hereby consent to all such modifications.

This waiver includes all claims I may have under the laws of the United States
or any other jurisdiction (whether or not in existence as of the date hereof)
related to the requirements imposed by the Limitations, including without
limitation, a claim for any compensation or other payments or benefits I would
otherwise receive, any challenge to the process by which the Limitations are or
were adopted and any tort or constitutional claim about the effect of these
Limitations on my employment relationship and I hereby agree that I will not at
any time initiate, or cause or permit to be initiated on my behalf, any such
claim against the United States, the Company or its directors, officers,
employees or agents in or before any local, state, federal or other agency,
court or body.

I agree that, in the event and to the extent that the Compensation Committee of
the Board of Directors of the Company or similar governing body (the
“Committee”) reasonably determines that any compensatory payment and benefit
provided to me, including any bonus or incentive compensation based on
materially inaccurate financial statements or performance criteria, would cause
the Company to fail to be in compliance with the Limitations (such payment or
benefit, an “Excess Payment”), upon notification from the Company, I shall repay
such Excess Payment to the Company within 15 business days. In addition, I agree
that the Company shall have the right to postpone any such payment or benefit
for a reasonable period of time to enable the Committee to determine whether
such payment or benefit would constitute an Excess Payment.

 
Annex D-1

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I understand that any determination by the Committee as to whether or not,
including the manner in which, a payment or benefit needs to be modified,
terminated or repaid in order for the Company to be in compliance with Section
111 of the EESA and/or the Limitations shall be a final and conclusive
determination of the Committee which shall be binding upon me. I further
understand that the Company is relying on this letter from me in connection with
its participation in a Program.

 
Annex D-2

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IN WITNESS WHEREOF, I execute this waiver on my own behalf, thereby
communicating my acceptance and acknowledgement to the provisions herein.

 
Respectfully,
             
Name:
 
Title:
 
Date:

 
Annex D-3

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ANNEX E

REGISTRATION RIGHTS

1.1              Definitions.  Terms not defined in this Annex shall have the
meaning ascribed to such terms in the Agreement. As used in this Annex E, the
following terms shall have the following respective meanings:

(a)              “Holder” means the Investor and any other holder of Registrable
Securities to whom the registration rights conferred by this Agreement have been
transferred in compliance with Section 1.9 hereof.

(b)              “Holders’ Counsel” means one counsel for the selling Holders
chosen by Holders holding a majority interest in the Registrable Securities
being registered.

(c)              “Pending Underwritten Offering” means, with respect to any
Holder forfeiting its rights pursuant to Section 1.11 of this Annex E, any
underwritten offering of Registrable Securities in which such Holder has advised
the Company of its intent to register its Registrable Securities either pursuant
to Section 1.2(b) or 1.2(d) of this Annex E prior to the date of such Holder’s
forfeiture.

(d)              “Register,” “registered,” and “registration” shall refer to a
registration effected by preparing and (A) filing a registration statement or
amendment thereto in compliance with the Securities Act and applicable rules and
regulations thereunder, and the declaration or ordering of effectiveness of such
registration statement or amendment thereto or (B) filing a prospectus and/or
prospectus supplement in respect of an appropriate effective registration
statement on Form S-3.

(e)               “Registrable Securities” means (A) all CDCI Preferred Shares
and (B) any equity securities issued or issuable directly or indirectly with
respect to the securities referred to in the foregoing clause (A) by way of
conversion, exercise or exchange thereof, or share dividend or share split or in
connection with a combination of shares, recapitalization, reclassification,
merger, amalgamation, arrangement, consolidation or other
reorganization, provided that, once issued, such securities will not be
Registrable Securities when (1) they are sold pursuant to an effective
registration statement under the Securities Act, (2) they shall have ceased to
be outstanding or (3) they have been sold in any transaction in which the
transferor’s rights under this Agreement are not assigned to the transferee of
the securities.  No Registrable Securities may be registered under more than one
registration statement at any one time.

(f)               “Registration Expenses” mean all expenses incurred by the
Company in effecting any registration pursuant to this Agreement (whether or not
any registration or prospectus becomes effective or final) or otherwise
complying with its obligations under this Annex E, including all registration,
filing and listing fees, printing expenses, fees and disbursements of counsel
for the Company, blue sky fees and expenses, expenses incurred in connection
with any “road show”, the reasonable fees and disbursements of Holders’
Counsel, and expenses of the Company’s independent accountants in connection
with any regular or special reviews or audits incident to or required by any
such registration, but shall not include Selling Expenses.

 
Annex E-1

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(g)              “Rule 144”, “Rule 144A”, “Rule 159A”, “Rule 405” and “Rule 415”
mean, in each case, such rule promulgated under the Securities Act (or any
successor provision), as the same shall be amended from time to time.

(h)              “Selling Expenses” mean all discounts, selling commissions and
stock transfer taxes applicable to the sale of Registrable Securities and fees
and disbursements of counsel for any Holder (other than the fees and
disbursements of Holders’ Counsel included in Registration Expenses).

(i)               “Special Registration” means the registration of (A) equity
securities and/or options or other rights in respect thereof solely registered
on Form S-4 or Form S-8 (or successor form) or (B) shares of equity securities
and/or options or other rights in respect thereof to be offered to directors,
members of management, employees, consultants, customers, lenders or vendors of
the Company or Company Subsidiaries or in connection with dividend reinvestment
plans.

1.2              Registration.

(a)              The Company covenants and agrees that as promptly as
practicable after the date that the Company becomes subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act (and in any event no
later than 30 days thereafter), the Company shall prepare and file with the SEC
a Shelf Registration Statement covering all Registrable Securities (or otherwise
designate an existing shelf registration on an appropriate form under Rule 415
under the Securities Act (a “Shelf Registration Statement”) filed with the SEC
to cover the Registrable Securities), and, to the extent the Shelf Registration
Statement has not theretofore been declared effective or is not automatically
effective upon such filing, the Company shall use reasonable best efforts to
cause such Shelf Registration Statement to be declared or become effective and
to keep such Shelf Registration Statement continuously effective and in
compliance with the Securities Act and usable for resale of such Registrable
Securities for a period from the date of its initial effectiveness until such
time as there are no Registrable Securities remaining (including by refiling
such Shelf Registration Statement (or a new Shelf Registration Statement) if the
initial Shelf Registration Statement expires).  Notwithstanding the foregoing,
if the Company is not eligible to file a registration statement on Form S-3,
then the Company shall not be obligated to file a Shelf Registration Statement
unless and until requested to do so in writing by the Investor.

(b)              Any registration pursuant to Section 1.2(a) of this Annex E
shall be effected by means of a Shelf Registration Statement on an appropriate
form under Rule 415 under the Securities Act (a “Shelf Registration
Statement”).  If the Investor or any other Holder intends to distribute any
Registrable Securities by means of an underwritten offering it shall promptly so
advise the Company and the Company shall take all reasonable steps to facilitate
such distribution, including the actions required pursuant to Section 1.2(d) of
this Annex E; provided that the Company shall not be required to facilitate an
underwritten offering of Registrable Securities unless (i) the expected gross
proceeds from such offering exceed $200,000 or (ii) such underwritten offering
includes all of the outstanding Registrable Securities held by such Holder.  The
lead underwriters in any such distribution shall be selected by the Holders of a
majority of the Registrable Securities to be distributed.

 
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(c)              The Company shall not be required to effect a registration
(including a resale of Registrable Securities from an effective Shelf
Registration Statement) or an underwritten offering pursuant to Section 1.2 of
this Annex E:  (A) with respect to securities that are not Registrable
Securities; or (B) if the Company has notified the Investor and all other
Holders that in the good faith judgment of the Board of Directors, it would be
materially detrimental to the Company or its securityholders for such
registration or underwritten offering to be effected at such time, in which
event the Company shall have the right to defer such registration for a period
of not more than 45 days after receipt of the request of the Investor or any
other Holder; provided that such right to delay a registration or underwritten
offering shall be exercised by the Company (1) only if the Company has generally
exercised (or is concurrently exercising) similar black-out rights against
holders of similar securities that have registration rights and (2) not more
than three times in any 12-month period and not more than 90 days in the
aggregate in any 12-month period.

(d)              If during any period when an effective Shelf Registration
Statement is not available, the Company proposes to register any of its equity
securities, other than a registration pursuant to Section 1.2(a) of this Annex E
or a Special Registration, and the registration form to be filed may be used for
the registration or qualification for distribution of Registrable Securities,
the Company will give prompt written notice to the Investor and all other
Holders of its intention to effect such a registration (but in no event less
than ten days prior to the anticipated filing date) and will include in such
registration all Registrable Securities with respect to which the Company has
received written requests for inclusion therein within ten business days after
the date of the Company’s notice (a “Piggyback Registration”).  Any such person
that has made such a written request may withdraw its Registrable Securities
from such Piggyback Registration by giving written notice to the Company and the
managing underwriter, if any, on or before the fifth business day prior to the
planned effective date of such Piggyback Registration. The Company may terminate
or withdraw any registration under this Section 1.2(d) prior to the
effectiveness of such registration, whether or not Investor or any other Holders
have elected to include Registrable Securities in such registration.

(e)              If the registration referred to in Section 1.2(d) of this Annex
E is proposed to be underwritten, the Company will so advise Investor and all
other Holders as a part of the written notice given pursuant to Section 1.2(d)
of this Annex E.  In such event, the right of Investor and all other Holders to
registration pursuant to Section 1.2 of this Annex E will be conditioned upon
such persons’ participation in such underwriting and the inclusion of such
person’s Registrable Securities in the underwriting if such securities are of
the same class of securities as the securities to be offered in the underwritten
offering, and each such person will (together with the Company and the other
persons distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company; provided that the Investor (as
opposed to other Holders) shall not be required to indemnify any person in
connection with any registration. If any participating person disapproves of the
terms of the underwriting, such person may elect to withdraw therefrom by
written notice to the Company, the managing underwriters and the Investor (if
the Investor is participating in the underwriting).

 
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(f)               If either (x) the Company grants “piggyback” registration
rights to one or more third parties to include their securities in an
underwritten offering under the Shelf Registration Statement pursuant to Section
1.2(b) of this Annex E or (y) a Piggyback Registration under Section 1.2(d) of
this Annex E relates to an underwritten offering on behalf of the Company, and
in either case the managing underwriters advise the Company that in their
reasonable opinion the number of securities requested to be included in such
offering exceeds the number which can be sold without adversely affecting the
marketability of such offering (including an adverse effect on the per share
offering price), the Company will include in such offering only such number of
securities that in the reasonable opinion of such managing underwriters can be
sold without adversely affecting the marketability of the offering (including an
adverse effect on the per share offering price), which securities will be so
included in the following order of priority: (A) first, in the case of a
Piggyback Registration under Section 1.2(d) of this Annex E, the securities the
Company proposes to sell, (B) then the Registrable Securities of the Investor
and all other Holders who have requested inclusion of Registrable Securities
pursuant to Section 1.2(b) or Section 1.2(d) of this Annex E, as applicable, pro
rata on the basis of the aggregate number of such securities or shares owned by
each such person and (C) lastly, any other securities of the Company that have
been requested to be so included, subject to the terms of this Agreement;
provided, however, that if the Company has, prior to the Signing Date, entered
into an agreement with respect to its securities that is inconsistent with the
order of priority contemplated hereby then it shall apply the order of priority
in such conflicting agreement to the extent that it would otherwise result in a
breach under such agreement.

1.3              Expenses of Registration.  All Registration Expenses incurred
in connection with any registration, qualification or compliance hereunder shall
be borne by the Company.  All Selling Expenses incurred in connection with any
registrations hereunder shall be borne by the holders of the securities so
registered pro rata on the basis of the aggregate offering or sale price of the
securities so registered.

1.4              Obligations of the Company.  Whenever required to effect the
registration of any Registrable Securities or facilitate the distribution of
Registrable Securities pursuant to an effective Shelf Registration Statement,
the Company shall, as expeditiously as reasonably practicable:

(a)              Prepare and file with the SEC a prospectus supplement or
post-effective amendment with respect to a proposed offering of Registrable
Securities pursuant to an effective registration statement, subject to Section
1.4 of this Annex E, keep such registration statement effective and keep such
prospectus supplement current until the securities described therein are no
longer Registrable Securities.

(b)              Prepare and file with the SEC such amendments and supplements
to the applicable registration statement and the prospectus or prospectus
supplement used in connection with such registration statement as may be
necessary to comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such registration statement.

 
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(c)              Furnish to the Holders and any underwriters such number of
copies of the applicable registration statement and each such amendment and
supplement thereto (including in each case all exhibits) and of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Securities owned or to be
distributed by them.

(d)              Use its reasonable best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders or any managing underwriter(s), to keep such registration or
qualification in effect for so long as such registration statement remains in
effect, and to take any other action which may be reasonably necessary to enable
such seller to consummate the disposition in such jurisdictions of the
securities owned by such Holder; provided that the Company shall not be required
in connection therewith or as a condition thereto to qualify to do business or
to file a general consent to service of process in any such states or
jurisdictions.

(e)              Notify each Holder of Registrable Securities at any time when a
prospectus relating thereto is required to be delivered under the Securities Act
of the happening of any event as a result of which the applicable prospectus, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing.

(f)               Give written notice to the Holders:

(i)               when any registration statement filed pursuant to Section
4.1(j) of the Agreement or any amendment thereto has been filed with the SEC
(except for any amendment effected by the filing of a document with the SEC
pursuant to the Exchange Act) and when such registration statement or any
post-effective amendment thereto has become effective;

(ii)              of any request by the SEC for amendments or supplements to any
registration statement or the prospectus included therein or for additional
information;

(iii)             of the issuance by the SEC of any stop order suspending the
effectiveness of any registration statement or the initiation of any proceedings
for that purpose;

(iv)             of the receipt by the Company or its legal counsel of any
notification with respect to the suspension of the qualification of the
applicable Registrable Securities for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose;

(v)              of the happening of any event that requires the Company to make
changes in any effective registration statement or the prospectus related to the
registration statement in order to make the statements therein not misleading
(which notice shall be accompanied by an instruction to suspend the use of the
prospectus until the requisite changes have been made); and

 
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(vi)             if at any time the representations and warranties of the
Company contained in any underwriting agreement contemplated by Section 1.4(j)
of this Annex E cease to be true and correct.

(g)              Use its reasonable best efforts to prevent the issuance or
obtain the withdrawal of any order suspending the effectiveness of any
registration statement referred to in Section 1.4(f)(iii) of this Annex E at the
earliest practicable time.

(h)              Upon the occurrence of any event contemplated by Section 1.4(e)
or 1.4(f)(v) of this Annex E, promptly prepare a post-effective amendment to
such registration statement or a supplement to the related prospectus or file
any other required document so that, as thereafter delivered to the Holders and
any underwriters, the prospectus will not contain an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.  If the Company notifies the Holders in accordance with Section
1.4(f)(v) to suspend the use of the prospectus until the requisite changes to
the prospectus have been made, then the Holders and any underwriters shall
suspend use of such prospectus and use their reasonable best efforts to return
to the Company all copies of such prospectus (at the Company’s expense) other
than permanent file copies then in such Holders’ or underwriters’
possession.  The total number of days that any such suspension may be in effect
in any 12-month period shall not exceed 90 days.

(i)               Use reasonable best efforts to procure the cooperation of the
Company’s transfer agent in settling any offering or sale of Registrable
Securities, including with respect to the transfer of physical stock
certificates into book-entry form in accordance with any procedures reasonably
requested by the Holders or any managing underwriter(s).

(j)               If an underwritten offering is requested pursuant to Section
1.2(b) of this Annex E, enter into an underwriting agreement in customary form,
scope and substance and take all such other actions reasonably requested by the
Holders of a majority of the Registrable Securities being sold in connection
therewith or by the managing underwriter(s), if any, to expedite or facilitate
the underwritten disposition of such Registrable Securities, and in connection
therewith in any underwritten offering (including making members of management
and executives of the Company available to participate in “road shows”, similar
sales events and other marketing activities), (A) make such representations and
warranties to the Holders that are selling stockholders and the managing
underwriter(s), if any, with respect to the business of the Company and its
subsidiaries, and the Shelf Registration Statement, prospectus and documents, if
any, incorporated or deemed to be incorporated by reference therein, in each
case, in customary form, substance and scope, and, if true, confirm the same if
and when requested, (B) use its reasonable best efforts to furnish the
underwriters with opinions of counsel to the Company, addressed to the managing
underwriter(s), if any, covering the matters customarily covered in such
opinions requested in underwritten offerings, (C) use its reasonable best
efforts to obtain “cold comfort” letters from the independent certified public
accountants of the Company (and, if necessary, any other independent certified
public accountants of any business acquired by the Company for which financial
statements and financial data are included in the Shelf Registration Statement)
who have certified the financial statements included in such Shelf Registration
Statement, addressed to each of the managing underwriter(s), if any, such
letters to be in customary form and covering matters of the type customarily
covered in “cold comfort” letters, (D) if an underwriting agreement is entered
into, the same shall contain indemnification provisions and procedures customary
in underwritten offerings (provided that the Investor shall not be obligated to
provide any indemnity), and (E) deliver such documents and certificates as may
be reasonably requested by the Holders of a majority of the Registrable
Securities being sold in connection therewith, their counsel and the managing
underwriter(s), if any, to evidence the continued validity of the
representations and warranties made pursuant to clause (A) above and to evidence
compliance with any customary conditions contained in the underwriting agreement
or other agreement entered into by the Company.

 
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(k)              Make available for inspection by a representative of Holders
that are selling stockholders, the managing underwriter(s), if any, and any
attorneys or accountants retained by such Holders or managing underwriter(s), at
the offices where normally kept, during reasonable business hours, financial and
other records, pertinent corporate documents and properties of the Company, and
cause the officers, directors and employees of the Company to supply all
information in each case reasonably requested (and of the type customarily
provided in connection with due diligence conducted in connection with a
registered public offering of securities) by any such representative, managing
underwriter(s), attorney or accountant in connection with such Shelf
Registration Statement.

(l)               Use reasonable best efforts to cause all such Registrable
Securities to be listed on each national securities exchange on which similar
securities issued by the Company are then listed or, if no similar securities
issued by the Company are then listed on any national securities exchange, use
its reasonable best efforts to cause all such Registrable Securities to be
listed on such securities exchange as the Investor may designate.

(m)             If requested by Holders of a majority of the Registrable
Securities being registered and/or sold in connection therewith, or the managing
underwriter(s), if any, promptly include in a prospectus supplement or amendment
such information as the Holders of a majority of the Registrable Securities
being registered and/or sold in connection therewith or managing underwriter(s),
if any, may reasonably request in order to permit the intended method of
distribution of such securities and make all required filings of such prospectus
supplement or such amendment as soon as practicable after the Company has
received such request.

(n)              Timely provide to its security holders earning statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder.

1.5              Suspension of Sales.  Upon receipt of written notice from the
Company that a registration statement, prospectus or prospectus supplement
contains or may contain an untrue statement of a material fact or omits or may
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading or that circumstances exist that make
inadvisable use of such registration statement, prospectus or prospectus
supplement, the Investor and each Holder of Registrable Securities shall
forthwith discontinue disposition of Registrable Securities until the Investor
and/or Holder has received copies of a supplemented or amended prospectus or
prospectus supplement, or until the Investor and/or such Holder is advised in
writing by the Company that the use of the prospectus and, if applicable,
prospectus supplement may be resumed, and, if so directed by the Company, the
Investor and/or such Holder shall deliver to the Company (at the Company’s
expense) all copies, other than permanent file copies then in the Investor
and/or such Holder’s possession, of the prospectus and, if applicable,
prospectus supplement covering such Registrable Securities current at the time
of receipt of such notice.  The total number of days that any such suspension
may be in effect in any 12-month period shall not exceed 90 days.

 
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1.6              Termination of Registration Rights.  A Holder’s registration
rights as to any securities held by such Holder (and its Affiliates, partners,
members and former members) shall not be available unless such securities are
Registrable Securities.

1.7              Furnishing Information.

(a)               Neither the Investor nor any Holder shall use any free writing
prospectus (as defined in Rule 405) in connection with the sale of Registrable
Securities without the prior written consent of the Company.

(b)              It shall be a condition precedent to the obligations of the
Company to take any action pursuant to Section 1.4 of this Annex E that Investor
and/or the selling Holders and the underwriters, if any, shall furnish to the
Company such information regarding themselves, the Registrable Securities held
by them and the intended method of disposition of such securities as shall be
required to effect the registered offering of their Registrable Securities.

1.8              Indemnification.

(a)              The Company agrees to indemnify each Holder and, if a Holder is
a person other than an individual, such Holder’s officers, directors, employees,
agents, representatives and Affiliates, and each person, if any, that controls a
Holder within the meaning of the Securities Act (each, an “Indemnitee”), against
any and all losses, claims, damages, actions, liabilities, costs and expenses
(including reasonable fees, expenses and disbursements of attorneys and other
professionals incurred in connection with investigating, defending, settling,
compromising or paying any such losses, claims, damages, actions, liabilities,
costs and expenses), joint or several, arising out of or based upon any untrue
statement or alleged untrue statement of material fact contained in any
registration statement, including any preliminary prospectus or final prospectus
contained therein or any amendments or supplements thereto or any documents
incorporated therein by reference or contained in any free writing prospectus
(as such term is defined in Rule 405) prepared by the Company or authorized by
it in writing for use by such Holder (or any amendment or supplement thereto);
or any omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; provided, that the Company shall not be
liable to such Indemnitee in any such case to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof) or expense
arises out of or is based upon (A) an untrue statement or omission made in such
registration statement, including any such preliminary prospectus or final
prospectus contained therein or any such amendments or supplements thereto or
contained in any free writing prospectus (as such term is defined in Rule 405)
prepared by the Company or authorized by it in writing for use by such Holder
(or any amendment or supplement thereto), in reliance upon and in conformity
with information regarding such Indemnitee or its plan of distribution or
ownership interests which was furnished in writing to the Company by such
Indemnitee for use in connection with such registration statement, including any
such preliminary prospectus or final prospectus contained therein or any such
amendments or supplements thereto, or (B)  offers or sales effected by or on
behalf of such Indemnitee “by means of” (as defined in Rule 159A) a “free
writing prospectus” (as defined in Rule 405) that was not authorized in writing
by the Company.

 
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(b)              If the indemnification provided for in Section 1.8(a) of this
Annex E is unavailable to an Indemnitee with respect to any losses, claims,
damages, actions, liabilities, costs or expenses referred to therein or is
insufficient to hold the Indemnitee harmless as contemplated therein, then the
Company, in lieu of indemnifying such Indemnitee, shall contribute to the amount
paid or payable by such Indemnitee as a result of such losses, claims, damages,
actions, liabilities, costs or expenses in such proportion as is appropriate to
reflect the relative fault of the Indemnitee, on the one hand, and the Company,
on the other hand, in connection with the statements or omissions which resulted
in such losses, claims, damages, actions, liabilities, costs or expenses as well
as any other relevant equitable considerations.  The relative fault of the
Company, on the one hand, and of the Indemnitee, on the other hand, shall be
determined by reference to, among other factors, whether the untrue statement of
a material fact or omission to state a material fact relates to information
supplied by the Company or by the Indemnitee and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission;  the Company and each Holder agree that it would not be
just and equitable if contribution pursuant to this Section 1.8(b) of this Annex
E were determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to in
Section 1.8(a) of this Annex E.  No Indemnitee guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from the Company if the Company was not guilty
of such fraudulent misrepresentation.

1.9              Assignment of Registration Rights.  The rights of the Investor
to registration of Registrable Securities pursuant to Section 1.2 of this Annex
E may be assigned by the Investor to any transferee or assignee of Registrable
Securities; provided, however, the transferor shall, within ten days after such
transfer, furnish to the Company written notice of the name and address of such
transferee or assignee and the number and type of Registrable Securities that
are being assigned.

1.10            Clear Market.  With respect to any underwritten offering of
Registrable Securities by the Investor or other Holders pursuant to this Annex
E, the Company agrees not to effect (other than pursuant to such registration or
pursuant to a Special Registration) any public sale or distribution, or to file
any Shelf Registration Statement (other than such registration or a Special
Registration) covering any preferred stock of the Company or any securities
convertible into or exchangeable or exercisable for preferred stock of the
Company, during the period not to exceed ten days prior and 60 days following
the effective date of such offering or such longer period up to 90 days as may
be requested by the managing underwriter for such underwritten offering.  The
Company also agrees to cause such of its directors and senior executive officers
to execute and deliver customary lock-up agreements in such form and for such
time period up to 90 days as may be requested by the managing underwriter.

1.11            Forfeiture of Rights.   At any time, any holder of Registrable
Securities (including any Holder) may elect to forfeit its rights set forth in
this Annex E from that date forward; provided, that a Holder forfeiting such
rights shall nonetheless be entitled to participate under Section 1.2(d) – (f)
of this Annex E in any Pending Underwritten Offering to the same extent that
such Holder would have been entitled to if the holder had not withdrawn; and
provided, further, that no such forfeiture shall terminate a Holder’s rights or
obligations under Section 1.7 of this Annex E with respect to any prior
registration or Pending Underwritten Offering.

 
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1.12            Specific Performance.  The parties hereto acknowledge that there
would be no adequate remedy at law if the Company fails to perform any of its
obligations under this Annex E and that the Investor and the Holders from time
to time may be irreparably harmed by any such failure, and accordingly agree
that the Investor and such Holders, in addition to any other remedy to which
they may be entitled at law or in equity, to the fullest extent permitted and
enforceable under applicable law shall be entitled to compel specific
performance of the obligations of the Company under this Annex E in accordance
with the terms and conditions of this Annex E.

1.13            No Inconsistent Agreements.  The Company shall not, on or after
the Signing Date, enter into any agreement with respect to its securities that
may impair the rights granted to the Investor and the Holders under this Annex E
or that otherwise conflicts with the provisions hereof in any manner that may
impair the rights granted to the Investor and the Holders under this Annex
E.  In the event the Company has, prior to the Signing Date, entered into any
agreement with respect to its securities that is inconsistent with the rights
granted to the Investor and the Holders under this Annex E (including agreements
that are inconsistent with the order of priority contemplated by Section 1.2(f)
of Annex E) or that may otherwise conflict with the provisions hereof, the
Company shall use its reasonable best efforts to amend such agreements to ensure
they are consistent with the provisions of this Annex E.

1.14            Certain Offerings by the Investor.  An “underwritten” offering
or other disposition shall include any distribution of such securities on behalf
of the Investor by one or more broker-dealers, an “underwriting agreement” shall
include any purchase agreement entered into by such broker-dealers, and any
“registration statement” or “prospectus” shall include any offering document
approved by the Company and used in connection with such distribution.

 
Annex E-10

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ANNEX F

OFFICER’S CERTIFICATE

OF

[COMPANY]

In connection with that certain letter agreement, dated [____________], 2010
(the “Agreement”) by and between [COMPANY] (the “Company”) and the United States
Department of the Treasury (“Investor”) which incorporates that certain Exchange
Agreement –Standard Terms referred to therein (the “Standard Terms”), the
undersigned does hereby certify as follows:

1.                I am a duly elected/appointed [____________] of the Company.

2.                Each Certified Entity (as defined in the Standard Terms) (A)
is certified by the Community Development Financial Institution Fund (the
“Fund”) of the United States Department of the Treasury as a regulated community
development financial institution (a “CDFI”); (B) together with its Affiliates
collectively meets the eligibility requirements of 12 C.F.R. 1805.200(b); (C)
has a primary mission of promoting community development, as may be determined
by Investor from time to time, based on criteria set forth in 12 C.F.R.
1805.201(b)(1); (D) provides Financial Products, Development Services, and/or
other similar financing as a predominant business activity in arm’s-length
transactions; (E) serves a Target Market by serving one or more Investment Areas
and/or Targeted Populations in the manner set forth in 12 C.F.R. 1805.201(b)(3);
(F) provides Development Services in conjunction with its Financial Products,
directly, through an Affiliate or through a contract with a third-party
provider; (G) maintains accountability to residents of the applicable Investment
Area(s) or Targeted Population(s) through representation on its governing Board
of Directors or otherwise; and (H) remains a non-governmental entity which is
not an agency or instrumentality of the United States of America, or any State
or political subdivision thereof, as described in 12 C.F.R. 1805.201(b)(6) and
within the meaning of any supplemental regulations or interpretations of 12
C.F.R. 1805.201(b)(6) or such supplemental regulations published by the
Fund.  As used herein, the terms “Affiliates”; “Financial Products”;
“Development Services”; “Target Market”; “Investment Areas”; and “Targeted
Populations” have the meanings ascribed to such terms in 12 C.F.R. 1805.104.

3.                The information set forth in the CDFI Certification
Application delivered to the Investor pursuant to Section 1.2(c)(xii) of the
Standard Terms (the “CDFI Application”), as modified by any updates to the CDFI
Application provided on [Insert Date(s)] by the Company to the Investor on or
prior to the date hereof, with respect to the covenants set forth in Section
4.1(d)(i)(B) and Section 4.1(d)(i)(D) of the Standard Terms remains true,
correct and complete as of the date hereof.

 
Annex F-1

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4.                The contracts and material agreements entered into by each
Certified Entity with respect to Development Services previously disclosed to
the Investor remain in effect   and copies of any new contracts and material
agreements entered into by the Certified Entity with respect to Development
Services are attached hereto as Exhibit A.

5.                Attached hereto as Exhibit B is (A) a list of the names and
addresses of the individuals which comprise the board of directors of each
Certified Entity as of the date hereof, (B) to the extent any member of the
board of directors listed on Exhibit B was not a member of the board of
directors as of the last certification provided to the Investor pursuant to
Section 4.1(d)(ii) of the Standard Terms, a narrative describing such
individual’s relationship to the applicable Investment Area(s) and Targeted
Population(s) and (C) to the extent any Certified Entity maintains
accountability to residents of the applicable Investment Area(s) or Target
Population(s) through means other than representation on its governing board of
directors and such means have changed since the date of the last certification
provided to the Investor pursuant to Section 4.1(d)(ii) of the Standard Terms on
[Insert Date], a narrative describing such change.

6.                Each Certified Entity is not an agency of the United States of
America, or any State or political subdivision thereof, as described in 12
C.F.R. 1805.201(b)(6) and within the meaning of any supplemental regulations or
interpretations of 12 C.F.R. 1805.201(b)(6) or such supplemental regulations
published by the Fund.

7.                [Insert if the Company was a Bank Holding Company or a Savings
and Loan Holding Company on the Signing Date: The Company is and has been at all
times since the date of the last certification provided to the Investor pursuant
to Section 4.1(d)(ii) of the Standard Terms, a [Insert if the Company is a Bank
Holding Company: Bank Holding Company] [Insert if the Company is a Savings and
Loan Holding Company: Savings and Loan Holding Company].] The Company is not,
and has not been at any time since the date of the last certification provided
to the Investor pursuant to Section 4.1(d)(ii) of the Standard Terms on [Insert
Date], controlled (within the meaning of [Insert for banks and Bank Holding
Companies: the Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)(2)) and 12
C.F.R. 225(a)(i)] [Insert for savings associations and Savings and Loan Holding
Companies: the Home Owners’ Loan Act of 1933 (12 U.S.C. 1467a (a)(2)) and 12
C.F.R. 583.7]) by a foreign bank or company.

The foregoing certifications are made and delivered as of [_________] pursuant
to Section 4.1(d)(ii) of the Standard Terms.

Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to them in the Standard Terms.

[SIGNATURE PAGE FOLLOWS]

 
Annex F-2

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IN WITNESS WHEREOF, this Officer’s Certificate has been duly executed and
delivered as of the [__] day of [__________], 20[__].

 
[COMPANY]
                 
By:
     
 
Name:
 
 
Title:

 
Annex F-3

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EXHIBIT A

NEW CONTRACTS AND MATERIAL AGREEMENTS

 
Exh. A-1

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EXHIBIT B

BOARD OF DIRECTORS

CERTIFD ENTITY: [CERTIFIED ENTITY]1
NAME
ADDRESS
NARRATIVE2
                             

________________________
 
1 Include chart for each Certified Entity.
 
2 To the extent (x) any of the individuals was not a member of the board of
directors of such Certified Entity as of the last certification to the Investor,
include a narrative describing such individual’s relationship to the applicable
Investment Area(s) and Targeted Population(s) or, (y) if such Certified Entity
maintains accountability to residents of the applicable Investment Area(s) or
Target Population(s) through means other than representation on its governing
board of directors and such means have changed since the date of the last
certification to the Investor, a narrative describing such change.

 
Exh. B-1

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SCHEDULE A

ADDITIONAL TERMS AND CONDITIONS

Company Information:

Name of the Company:  United Bancorporation of Alabama, Inc.

Corporate or other organizational form of Company: Corporation

Jurisdiction of Organization of Company:  Delaware

Appropriate Federal Banking Agency of Company:  Board of Governors of the
Federal Reserve System

Name of Certified Entities: United Bank

Corporate or other organizational form of each Certified Entity: Banking
Corporation

Jurisdiction of Organization of each Certified Entity: Alabama

Appropriate Federal Banking Agency of each Certified Entity: Federal Deposit
Insurance Corporation

Notice Information:
Allen O. Jones, Jr.
COPY TO:
 
Senior Vice President and CFO
Hugh C. Nickson, III, Esq.
 
200 East Nashville Avenue
Jones Walker
 
Atmore, Alabama 36502
1819 5th Avenue North
   
Suite 1100
   
Birmingham, Alabama 35203

Terms of the Exchange:

Series of CDCI Preferred Stock Exchanged: Fixed Rate Cumulative
Perpetual  Preferred Stock, Series B

Per Share Liquidation Preference of CDCI Preferred Stock: $1,000 per share

Number of Shares of CDCI Preferred Stock Exchanged:  10,300

Dividend Payment Dates on the CDCI Preferred Stock: Payable quarterly in arrears
on February 15, May 15, August 15 and  November 15 of each year.

Series of CPP Preferred Stock Exchanged:  Fixed Rate Cumulative
Perpetual  Preferred Stock, Series A

Number of Shares of CPP Preferred Stock Exchanged: 10,300

 
 

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Date of Letter Agreement pursuant to which CPP Preferred Shares were purchased:
December 23, 2008

Closing:

Location of Closing: Washington, D.C.

Time of Closing: TBD

Date of Closing:  September 3, 2010

 
 

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SCHEDULE B

CAPITALIZATION

Capitalization Date:
   
July 31, 2010
           
Common Stock:
                 
Par value:
    $ 0.01              
Total Authorized:
      5,000,000              
Outstanding:
      2,389,127              
Subject to warrants, options, convertible securities, etc.:
      141,704              
Reserved for benefit plans and other issuances:
      786,193              
Remaining authorized but unissued:
      1,682,976              
Shares issued after Capitalization Date (other than pursuant to warrants,
options, convertible securities, etc. as set forth above):
      0              
Preferred Stock
                     
Par value:
    $ 0.01              
Total Authorized:
      250,000              
Outstanding (by series):
Series A
    10,300              
Reserved for issuance:
      0              
Remaining authorized but unissued:
      239,700              
Holders of 5% or more of any class of capital stock
   
Primary Address
             
Series A Preferred – United States Treasury
   
Washington, D.C.
 

 
 

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SCHEDULE C

MATERIAL ADVERSE EFFECT

List any exceptions to the representation and warranty in Section 3.6 of the
Exchange Agreement – Standard Terms.

If none, please so indicate by checking the box:   o.

Since December, 2008, the level of Non-Performing Assets has increased.  The
table below shows level from that date to June, 2010.

EXCHANGE AGREEMENT

(Dollars in Thousands)

Description
 
June, 2010
   
December, 2008
 
A. Loans accounting for a nonaccrual basis
  $ 20,891       14,700  
B. Loans which are contractually past due ninety days or more as to interest or
principal payments (excluding balances included in (A) above)
    793       28  
C. Loans, the terms of which have been renegotiated to provide a reduction or
deferral of interest or principal because of a deterioration in the financial
position of the borrower.
    1,464       1,106  
D. Other non-performing assets
    8,660       5,524  
Total
  $ 31,808     $ 21,358  

 
 

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SCHEDULE D

LITIGATION

List any exceptions to the representation and warranty in Section 3.10 of the
Exchange Agreement – Standard Terms.

If none, please so indicate by checking the box:  T.

 
 

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SCHEDULE E

COMPLIANCE WITH LAWS

List any exceptions to the representation and warranty in the second sentence of
Section 3.11 of the Exchange Agreement– Standard Terms.
 

If none, please so indicate by checking the box:  T.
 

List any exceptions to the representation and warranty in the last sentence of
Section 3.11 of the Exchange Agreement – Standard Terms.
 

If none, please so indicate by checking the box:  o.
 

Please refer to Schedule F.
 
 

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