Exhibit 10.1

SECURITIES PURCHASE AGREEMENT

This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of August 28,
2012, is by and among Lakeland Bancorp, Inc., a New Jersey corporation (the
“Company”), and the investors listed on the signature pages hereto
(individually, a “Buyer” and collectively, the “Buyers”).

RECITALS

A. Each Buyer wishes to purchase, and the Company wishes to sell, upon the terms
and conditions stated in this Agreement, the number of shares of common stock,
no par value, of the Company (the “Common Stock”) set forth below such Buyer’s
name on its signature page to this Agreement (which aggregate amount for all
Buyers together shall be 1,983,315 shares of Common Stock and shall collectively
be referred to herein as the “Shares”).

B. The Company has filed a Registration Statement under the Securities Act of
1933, as amended (the “1933 Act”), on Form S-3 (Registration Number 333-162932),
which was declared effective by the Securities and Exchange Commission (the
“SEC”) on November 10, 2009 (the “Registration Statement”). The Company shall
issue the Shares pursuant to the currently effective Registration Statement.

C. Simultaneously with the closing of the sale of the Shares to the Buyers
hereunder, the Company intends to sell up to an additional 621,762 shares of
Common Stock (or up to 683,938 shares if the Underwriter’s over-allotment option
is exercised in full) (the “Underwritten Shares”), at a public offering price
per share not less than the Per Share Purchase Price (as defined below), to
Keefe, Bruyette & Woods (“KBW”), as Underwriter, in an underwritten public
offering that is also being made pursuant to the currently effective
Registration Statement.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and each Buyer hereby
agree as follows:

 

  1. PURCHASE AND SALE OF SHARES.

(a) Shares. Subject to the satisfaction (or waiver) of the conditions set forth
in Sections 5 and 6 below, the Company shall issue and sell to each Buyer, and
each Buyer severally, but not jointly, shall purchase from the Company on the
Closing Date (as defined below), the number of Shares as is set forth below such
Buyer’s name on its signature page to this Agreement, at a purchase price of
$9.65 per share (the “Per Share Purchase Price”).

(b) Closing. The closing (the “Closing”) of the purchase of the Shares by the
Buyers shall occur at the offices of Lowenstein Sandler PC, 1251 Avenue of the
Americas, New York, NY 10020. The date and time of the Closing (the “Closing
Date”) shall be 10:00 a.m.,

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New York City time, on the first (1st) Business Day on which the conditions to
the Closing set forth in Sections 5 and 6 below are satisfied or waived (or such
later date as is mutually agreed to by the Company and each Buyer). As used
herein “Business Day” means any day other than a Saturday, Sunday or other day
on which commercial banks in New York, New York are authorized or required by
law to remain closed.

(c) Purchase Price. The aggregate purchase price for the Shares to be purchased
by each Buyer (the “Purchase Price”) shall be the amount set forth below such
Buyer’s name on its signature page to this Agreement. Each Buyer shall pay its
respective Purchase Price for the Shares to be purchased by such Buyer at the
Closing.

(d) Payment; Settlement Mechanics. On the Closing Date, (i) the Company shall
cause its transfer agent to deliver to each Buyer the number of Shares as is set
forth below such Buyer’s name on its signature page to this Agreement (such
Shares shall be registered in the name of such Buyer or as otherwise set forth
on such Buyer’s signature page to this Agreement) and (ii) upon receipt of such
Shares, each Buyer shall pay its respective Purchase Price to the Company for
the Shares to be issued and sold to such Buyer at the Closing. The Shares shall
not bear any restrictive or other legends (electronic or otherwise). If a Buyer
chooses to settle via Deposit/Withdrawal At Custodian (“DWAC”) (by checking the
appropriate space on such Buyer’s signature page hereto), then as between the
Company and such Buyer, the provisions set forth in Exhibit A hereto shall be
incorporated herein by reference as if set forth fully herein. If a Buyer
chooses to settle delivery versus payment (“DVP”) (by checking the appropriate
space on such Buyer’s signature page hereto), then as between the Company and
such Buyer, the provisions set forth in Exhibit B hereto shall be incorporated
herein by reference as set forth fully herein.

 

  2. BUYER’S REPRESENTATIONS AND WARRANTIES.

Each Buyer, severally and not jointly, represents and warrants to the Company
with respect to only itself that:

(a) Organization; Authority. Such Buyer is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization with the requisite power and authority to enter into and to
consummate the transactions contemplated by this Agreement and otherwise to
carry out its obligations hereunder.

(b) Validity; Enforcement. This Agreement has been duly and validly authorized,
executed and delivered on behalf of such Buyer and constitutes the legal, valid
and binding obligations of such Buyer enforceable against such Buyer in
accordance with their respective terms, except as such enforceability may be
limited by general principles of equity or to applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation and other similar laws relating to, or
affecting generally, the enforcement of applicable creditors’ rights and
remedies.

(c) No Conflicts. The execution, delivery and performance by such Buyer of this
Agreement and the consummation by such Buyer of the transactions contemplated
hereby will not (i) result in a violation of the organizational documents of
such Buyer or (ii) conflict

 

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with, or constitute a default (or an event which with notice or lapse of time or
both would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which such Buyer is a party, or (iii) result in a violation of any
law, rule, regulation, order, judgment or decree (including federal and state
securities laws) applicable to such Buyer, except in the case of clauses
(ii) and (iii) above, for such conflicts, defaults, rights or violations which
would not, individually or in the aggregate, reasonably be expected to have a
material adverse effect on the ability of such Buyer to perform its obligations
hereunder.

(d) Residency. Such Buyer’s office in which its investment decision with respect
to the Shares was made is located in the jurisdiction below such Buyer’s name on
its signature page hereto.

(e) Certain Trading Activities. Such Buyer has not directly or indirectly, nor
has any Person (as defined below) acting on behalf of or pursuant to any
understanding with such Buyer, engaged in any transactions in the securities of
the Company (including, without limitation, any Short Sales (as defined below)
involving the Company’s securities) during the period commencing as of the time
that such Buyer was first contacted by the Company regarding the specific
investment in the Company contemplated by this Agreement and ending immediately
prior to the execution of this Agreement by such Buyer. “Short Sales” mean all
“short sales” as defined in Rule 200 promulgated under Regulation SHO under the
Securities Exchange Act of 1934, as amended (the “1934 Act”) (but shall not be
deemed to include the location and/or reservation of borrowable shares of Common
Stock). Notwithstanding the foregoing, in the case of a Buyer that is a
multi-managed investment vehicle whereby separate portfolio managers manage
separate portions of such Buyer’s assets and the portfolio managers have no
direct knowledge of the investment decisions made by the portfolio managers
managing other portions of such Buyer’s assets, the representation set forth
above shall only apply with respect to the portion of assets managed by the
portfolio manager that made the investment decision to purchase the Shares
covered by this Agreement. For purposes of this Agreement, “Person” means an
individual, a limited liability company, a partnership, a joint venture, a
corporation, a trust, an unincorporated organization, any other entity and a
government or any department or agency thereof.

(f) Beneficial Ownership. Assuming the accuracy of the Company’s representations
and warranties set forth in Section 3, the purchase of Shares by such Buyer
shall not (i) cause such Buyer or any of its affiliates to violate any banking
regulation, (ii) require such Buyer or any of its affiliates to file a prior
notice under the Change in Bank Control Act (the “CIBCA”), or otherwise seek
prior approval of any banking regulator, (iii) require such Buyer or any of its
affiliates to become a bank holding company or otherwise serve as a source of
strength for the Company or any Subsidiary or (iv) cause such Buyer, together
with any other person whose Company securities would be aggregated with such
Buyer’s Company securities for purposes of any bank regulation or law, to
collectively be deemed to own, control or have the power to vote securities
which (assuming, for this purpose only, full conversion and/or exercise of such
securities by the Buyer and such other persons) would represent more than 9.9%
of any class of voting securities of the Company outstanding at such time.

 

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  3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to each of the Buyers that:

(a) Organization and Qualification; Subsidiaries. Each of the Company and each
of its direct and indirect subsidiaries constituting a “significant subsidiary”
within the meaning of Rule 1-02(w) of Regulation S-X (each such significant
subsidiary, a “Subsidiary”) are entities duly organized and validly existing and
in good standing under the laws of the jurisdiction in which they are formed,
and have the requisite power and authorization to own their properties and to
carry on their business as now being conducted and as presently proposed to be
conducted. Each of the Company and its Subsidiaries is duly qualified as a
foreign entity to do business and is in good standing in every jurisdiction in
which its ownership of property or the nature of the business conducted by it
makes such qualification necessary, except to the extent that the failure to be
so qualified or be in good standing would not have a Material Adverse Effect. As
used in this Agreement, “Material Adverse Effect” means any material adverse
effect on (i) the business, properties, assets, liabilities, operations
(including results thereof), condition (financial or otherwise) or prospects of
the Company or any of its Subsidiaries, taken as a whole, (ii) the legality,
validity or enforceability of the transactions contemplated hereby or in the
other Transaction Documents (as defined below) or (iii) the authority or ability
of the Company to perform its obligations under the Transaction Documents.
Except as set forth on Schedule 3(a), the Company has no Subsidiaries.

(b) Bank Holding Company; State Bank Status. The Company is duly registered as a
bank holding company under the Bank Holding Company Act of 1956, as amended (the
“BHC Act”), and meets in all material respects the applicable requirements for
qualification as such. Lakeland Bank, a New Jersey state-chartered bank and
wholly-owned subsidiary of the Company (the “Bank”), holds the requisite
authority from the New Jersey Department of Banking and Insurance (the “NJ
Department”) to conduct business as a state-chartered bank under the laws of the
State of New Jersey. The deposit accounts of the Bank are insured up to
applicable limits by the Federal Deposit Insurance Corporation (the “FDIC”), and
all premiums and assessments required to be paid in connection therewith have
been paid when due.

(c) Authorization; Enforcement; Validity. The Company has the requisite power
and authority to enter into and perform its obligations under this Agreement and
the other Transaction Documents and to issue the Shares in accordance with the
terms hereof and thereof. The execution and delivery of this Agreement and the
other Transaction Documents by the Company, and the consummation by the Company
of the transactions contemplated hereby and thereby (including, without
limitation, the issuance of the Shares) have been duly authorized by the
Company’s board of directors and, other than the filing with the SEC of a final
prospectus supplement relating to the transactions contemplated hereby (the
“Prospectus Supplement”), no further filing, consent or authorization is
required by the Company, its board of directors or its stockholders or other
governing body or regulatory authority. This Agreement and the other Transaction
Documents to which the Company is a party have been (or upon delivery will have
been) duly executed and delivered by the Company and when delivered in
accordance with the terms hereof and thereof, will constitute the legal, valid
and binding obligations of the Company, enforceable against the Company in
accordance with their respective terms, except as such

 

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enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally, the enforcement of applicable creditors’
rights and remedies and except as rights to indemnification and to contribution
may be limited by federal or state securities law. There are no stockholder
agreements, voting agreements, or other similar arrangements with respect to the
Company’s capital stock to which the Company is a party or, to the Company’s
knowledge, between or among any of the Company’s stockholders. “Transaction
Documents” means, collectively, this Agreement and each of the other agreements
and instruments entered into and/or delivered by the parties hereto in
connection with the proposed sale and issuance of Common Stock contemplated
hereby and thereby.

(d) Issuance of Shares; Registration Statement. The issuance of the Shares is
duly authorized and, when issued and paid for in accordance with the terms of
this Agreement, the Shares shall be validly issued, fully paid and
non-assessable and free from all taxes, liens, charges and other encumbrances
imposed by the Company. The Company has reserved from its duly authorized
capital stock the maximum number of shares of Common Stock issuable pursuant to
this Agreement. The issuance of the Shares has been registered by the Company
under the 1933 Act, the Shares are being issued pursuant to the Registration
Statement and all of the Shares are freely transferable and freely tradable by
each of the Buyers on the Principal Market (as defined below) without
restriction. The Registration Statement is effective and available for the
issuance of the Shares thereunder and the Company has not received any notice
that the SEC has issued or intends to issue a stop-order or other order with
respect to the Registration Statement or the Prospectus (as defined below) or
that the SEC otherwise has (i) suspended or withdrawn the effectiveness of the
Registration Statement or (ii) issued any order preventing or suspending the use
of the Prospectus, in either case, either temporarily or permanently, or intends
or has threatened in writing to do so. The “Plan of Distribution” section under
the Registration Statement permits the issuance of the Shares hereunder. Upon
receipt of the Shares, each of the Buyers will have good and marketable title to
the Shares. At the time the Registration Statement and any amendments thereto
became effective, at the date of this Agreement and at the Closing Date, the
Registration Statement and any amendments thereto complied and will comply in
all material respects to the requirements of the 1933 Act and did not and will
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading; and the base prospectus included in the Registration
Statement (the “Prospectus”) and any amendments or supplements thereto
(including, without limitation, the Prospectus Supplement), at the time the
Prospectus or any amendment or supplement thereto was issued and at the Closing
Date, complied and will comply in all material respects to the requirements of
the 1933 Act and did not and will not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The Company meets all of the requirements for the use of Form S-3
under the 1933 Act for the offering and sale of the Shares, and the SEC has not
notified the Company of any objection to the use of the form of the Registration
Statement pursuant to Rule 401(g)(1) under the 1933 Act. The Registration
Statement meets the requirements set forth in Rule 415(a)(1)(x) under the 1933
Act. At the earliest time after the filing of the Registration Statement that
the Company or another offering participant made a bona fide offer (within the
meaning of Rule 164(h)(2) under the 1933 Act) relating to any of the Shares, the
Company was not and is not an “Ineligible Issuer” (as defined in Rule 405 under
the 1933 Act). The Company

 

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has not distributed any offering material in connection with the offering and
sale of any of the Shares, other than the Registration Statement, the Prospectus
or the Prospectus Supplement. In accordance with Rule 5110(b)(7)(C)(i) of the
Financial Industry Regulatory Authority Manual, the offering of the Shares has
been registered with the SEC on Form S-3 under the 1933 Act pursuant to the
standards for Form S-3 in effect prior to October 21, 1992, and the Shares are
being offered pursuant to Rule 415 promulgated under the 1933 Act. The
Prospectus Supplement does not contain any material non-public information other
than the terms of the transactions contemplated by this Agreement.

(e) No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, the issuance of
the Shares) will not (i) result in a violation of the Company’s Certificate of
Incorporation, as amended and as in effect on the date hereof, including,
without limitation, any certificates of amendment contained therein or attached
thereto (the “Certificate of Incorporation”), or other organizational documents
of the Company or any of its Subsidiaries or the Company’s bylaws, as amended
and as in effect on the date hereof (the “Bylaws”), (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company or any of its Subsidiaries is a party, or
(iii) subject to the making of the Required Filings (as defined below) by the
Company, result in a violation of any law, rule, regulation, order, judgment or
decree (including foreign, federal and state securities laws and regulations and
the rules and regulations of the Nasdaq Global Select Market (the “Principal
Market”)) applicable to the Company or any of its Subsidiaries or by which any
property or asset of the Company or any of its Subsidiaries is bound or affected
except, in the case of clause (ii) or (iii) above, to the extent such violations
would not reasonably be expected to result in a Material Adverse Effect.

(f) Consents. The Company is not required to obtain any consent from,
authorization or order of, or make any filing or registration with, any court,
governmental agency or any regulatory or self-regulatory agency or any other
Person (including, without limitation, the Financial Industry Regulatory
Authority) in order for it to execute, deliver or perform any of its obligations
under or contemplated by the Transaction Documents, in each case, in accordance
with the terms hereof or thereof, other than (i) the filing with the SEC of the
Prospectus Supplement and (ii) the filing with the SEC of the 8-K Filing (as
defined below) (collectively, the “Required Filings”). All consents,
authorizations, orders, filings and registrations which the Company is required
to obtain at or prior to the Closing have been obtained or effected on or prior
to the Closing Date, and neither the Company nor any of its Subsidiaries are
aware of any facts or circumstances which might prevent the Company from
obtaining or effecting any of the registration, application or filings
contemplated by the Transaction Documents. Required Filings to be made after the
Closing Date shall be made in compliance with the terms of this Agreement and
applicable federal and state securities laws. The Company is not in violation of
the requirements of the Principal Market and has no knowledge of any facts or
circumstances which could reasonably lead to delisting or suspension of the
Common Stock in the foreseeable future.

(g) Acknowledgment Regarding Buyer’s Purchase of Shares. The Company
acknowledges and agrees that each Buyer is acting solely in the capacity of an
arm’s length

 

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purchaser with respect to the Transaction Documents and the transactions
contemplated hereby and thereby. The Company further acknowledges that no Buyer
is acting as a financial advisor or fiduciary of the Company or any of its
Subsidiaries (or in any similar capacity) with respect to the Transaction
Documents and the transactions contemplated hereby and thereby, and any advice
given by a Buyer or any of its representatives or agents in connection with the
Transaction Documents and the transactions contemplated hereby and thereby is
merely incidental to such Buyer’s purchase of the Shares. The Company further
represents to each Buyer that the Company’s decision to enter into the
Transaction Documents has been based solely on the independent evaluation by the
Company and its representatives.

(h) Placement Agent/Underwriter Fees. The Company shall be responsible for the
payment of any placement agent’s fees, financial advisory fees, or brokers’
commissions (other than for Persons engaged by any Buyer or its investment
advisor) relating to or arising out of the transactions contemplated hereby.
Neither the Company nor any of its Subsidiaries has engaged any financial
advisor, any placement agent or any other agent in connection with the offer or
sale of the Shares. The Company will owe certain underwriting discounts and fees
to KBW with respect to the Underwritten Shares, but not with respect to the
Shares to be sold under this Agreement.

(i) No Integrated Offering. None of the Company, the Subsidiaries or any of
their affiliates, nor any Person acting on their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would cause this offering of the
Shares to require approval of stockholders of the Company under any applicable
stockholder approval provisions, including, without limitation, under the rules
and regulations of any exchange or automated quotation system on which any of
the securities of the Company are listed or designated. None of the Company, its
Subsidiaries, their affiliates nor any Person acting on their behalf will take
any action or steps referred to in the preceding sentence that would cause the
offering of any of the Shares to be integrated with other offerings of
securities of the Company.

(j) Application of Takeover Protections; Rights Agreement. The Company has not
adopted any stockholder rights plan or similar arrangement that is currently in
effect relating to accumulations of beneficial ownership of Common Stock or a
change of control of the Company. The Company and its board of directors have
taken all necessary action, if any, in order to render inapplicable any control
share acquisition, business combination, poison pill (including any distribution
under a rights agreement) or other similar anti-takeover provision under the
Certificate of Incorporation or other organizational documents or the laws of
the jurisdiction of its incorporation or otherwise which is or could become
applicable to any Buyer as a result of the transactions contemplated by this
Agreement, including, without limitation, the Company’s issuance of the Shares
and any Buyer’s ownership of the Shares, provided that the Buyers’ beneficial
ownership of the Company’s Common Stock remains below ten percent (10%) of the
Company’s outstanding shares.

(k) SEC Documents; Financial Statements. During the two (2) years prior to the
date hereof, the Company has timely filed all reports, schedules, forms,
statements and other documents required to be filed by it with the SEC pursuant
to the reporting requirements of the 1934 Act (all of the foregoing filed prior
to the date hereof and all exhibits included therein and

 

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financial statements, notes and schedules thereto and documents incorporated by
reference therein being referred to herein as the “SEC Documents”). As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the 1934 Act and the rules and regulations of the SEC
promulgated thereunder applicable to the SEC Documents, and none of the SEC
Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. As of
their respective dates, the financial statements of the Company included in the
SEC Documents complied in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto as in effect as of the time of filing. Such financial statements have
been prepared in accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (i) as may be
otherwise indicated in such financial statements or the notes thereto, or
(ii) in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments which will not be material, either individually or in the
aggregate). No other information provided by or on behalf of the Company to the
Buyers which is not included in the SEC Documents contains any untrue statement
of a material fact or omits to state any material fact necessary in order to
make the statements therein not misleading, in the light of the circumstance
under which they are or were made.

(l) Absence of Certain Changes. Since the date of the Company’s most recent
audited financial statements contained in the Form 10-K, except as disclosed in
subsequent SEC Documents filed prior to the date hereof, there has been no
material adverse change and no material adverse development in the business,
assets, liabilities, properties, operations (including results thereof),
condition (financial or otherwise) or prospects of the Company or any of its
Subsidiaries. Since the date of the Company’s most recent audited financial
statements contained in the Form 10-K, except as disclosed in subsequent SEC
Documents filed prior to the date hereof, neither the Company nor any of its
Subsidiaries has (i) declared or paid any dividends other than by Subsidiaries
to the Company, (ii) sold any material assets, individually or in the aggregate,
outside of the ordinary course of business or (iii) made any material capital
expenditures, individually or in the aggregate. Neither the Company nor any of
its Subsidiaries has taken any steps to seek protection pursuant to any law or
statute relating to bankruptcy, insolvency, reorganization, liquidation or
winding up, nor does the Company or any Subsidiary have any knowledge or reason
to believe that any of their respective creditors intend to initiate involuntary
bankruptcy proceedings or any actual knowledge of any fact which would
reasonably lead a creditor to do so. The Company and its Subsidiaries,
individually and on a consolidated basis, are not as of the date hereof, and
after giving effect to the transactions contemplated hereby to occur at the
Closing will not be, insolvent. Neither the Company nor any of its Subsidiaries
has engaged in business or in any transaction, and is not about to engage in
business or in any transaction, for which the Company’s or such Subsidiary’s
remaining assets constitute unreasonably small capital.

(m) No Undisclosed Events, Liabilities, Developments or Circumstances. Other
than the announcement of the pending sale of the Underwritten Shares, which

 

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announcement will occur on or before 9:15 a.m. on the first Business Day after
the date hereof, no event, liability, development or circumstance has occurred
or exists, or is reasonably expected to exist or occur with respect to the
Company, any of its Subsidiaries or their respective business, properties,
liabilities, prospects, operations (including results thereof) or condition
(financial or otherwise), that (i) would be required to be disclosed by the
Company under applicable securities laws on a registration statement on Form S-1
filed with the SEC relating to an issuance and sale by the Company of its Common
Stock and which has not been publicly announced or contained in the SEC
Documents or (ii) could reasonably result in a Material Adverse Effect or a
material adverse effect on any Buyer’s investment hereunder.

(n) Conduct of Business; Regulatory Permits. Neither the Company nor any of its
Subsidiaries is in violation of any term of or in default under its Certificate
of Incorporation or any amendment thereto or Bylaws or their organizational
charter, certificate of incorporation or bylaws, respectively. Neither the
Company nor any of its Subsidiaries is in violation of any judgment, decree or
order or any statute, ordinance, rule or regulation applicable to the Company or
any of its Subsidiaries, and neither the Company nor any of its Subsidiaries
will conduct its business in violation of any of the foregoing, except in all
cases for possible violations which would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect. Without limiting
the generality of the foregoing, the Company is not in violation of any of the
rules, regulations or requirements of the Principal Market and has no knowledge
of any facts or circumstances that would reasonably be expected to result in
delisting or suspension of the Common Stock by the Principal Market in the
foreseeable future. Since January 1, 2012, (i) the Common Stock has been
designated for quotation on the Principal Market, (ii) trading in the Common
Stock has not been suspended by the SEC or the Principal Market and (iii) the
Company has received no communication, written or oral, from the SEC or the
Principal Market regarding the suspension or delisting of the Common Stock from
the Principal Market. Neither the Company nor any of its Subsidiaries is in
default under or in violation of (and no event has occurred that has not been
waived that, with notice or lapse of time or both, would result in a default by
the Company or any Subsidiary under), nor has the Company or any Subsidiary
received notice of a claim that it is in default under or that it is in
violation of, any indenture, loan or credit agreement or any other agreement or
instrument to which it is a party or by which it or any of its properties is
bound (whether or not such default or violation has been waived), except in all
cases for possible defaults or violations which would not, individually or in
the aggregate, reasonably be expected to result in a Material Adverse Effect.
The Company and each of its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate regulatory authorities
necessary to conduct their respective businesses, except where the failure to
possess such certificates, authorizations or permits would not, individually or
in the aggregate, reasonably be expected to result in a Material Adverse Effect,
and neither the Company nor any such Subsidiary has received any written notice
of proceedings relating to the revocation or modification of any such
certificate, authorization or permit.

(o) Questionable Payments. Neither the Company nor any of the Subsidiaries nor
any director, officer, agent, employee or other Person acting on behalf of the
Company or any of its Subsidiaries has, in the course of its actions for, or on
behalf of, the Company or any of its Subsidiaries (i) used any corporate funds
for any unlawful contribution, gift, entertainment or other unlawful expenses
relating to political activity; (ii) made any direct or indirect unlawful
payment to any foreign or domestic government official or employee from
corporate funds; (iii)

 

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violated or is in violation of any provision of the U.S. Foreign Corrupt
Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate,
payoff, influence payment, kickback or other unlawful payment to any foreign or
domestic government official or employee.

(p) Sarbanes-Oxley Act. The Company and each Subsidiary is in material
compliance with all applicable requirements of the Sarbanes-Oxley Act of 2002
that are effective as of the date hereof, and all applicable rules and
regulations promulgated by the SEC thereunder that are effective as of the date
hereof.

(q) Transactions with Affiliates. No relationship, direct or indirect, exists
between or among the Company or any of the Subsidiaries, on the one hand, and
any directors, officers, or employees of the Company or any of the Subsidiaries,
on the other hand, which is required to be described in SEC Documents and is not
adequately described therein to satisfy the requirements of the Securities Act
and the rules and regulations promulgated thereby.

(r) Equity Capitalization. The capitalization of the Company as of the date
hereof is as set forth on Schedule 3(r). All of such outstanding shares are duly
authorized and have been, or upon issuance will be, validly issued and are fully
paid and nonassessable. Except as disclosed on Schedule 3(r): (i) none of the
Company’s or any material Subsidiary’s capital stock is subject to preemptive
rights or any other similar rights or any liens suffered or permitted by the
Company or any Subsidiary; (ii) there are no outstanding options, warrants,
scrip, rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, or exercisable or
exchangeable for, any capital stock of the Company or any of its Subsidiaries,
or contracts, commitments, understandings or arrangements by which the Company
or any of its Subsidiaries is or may become bound to issue additional capital
stock of the Company or any of its Subsidiaries or options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, or exercisable or
exchangeable for, any capital stock of the Company or any of its Subsidiaries;
(iii) there are no outstanding debt securities, notes, credit agreements, credit
facilities or other agreements, documents or instruments evidencing indebtedness
of the Company or any of its Subsidiaries or by which the Company or any of its
Subsidiaries is or may become bound; (iv) there are no financing statements
securing obligations in any material amounts filed in connection with the
Company or any of its Subsidiaries; (v) there are no agreements or arrangements
under which the Company or any of its Subsidiaries is obligated to register the
sale of any of their securities under the 1933 Act (except as contemplated by
this Agreement); (vi) there are no outstanding securities or instruments of the
Company or any of its Subsidiaries which contain any redemption or similar
provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become
bound to redeem a security of the Company or any of its Subsidiaries;
(vii) there are no securities or instruments containing anti-dilution or similar
provisions that will be triggered by the issuance of the Shares; (viii) neither
the Company nor any Subsidiary has any stock appreciation rights or “phantom
stock” plans or agreements or any similar plan or agreement; and (ix) neither
the Company nor any of its Subsidiaries have any liabilities or obligations
required to be disclosed in the SEC Documents which are not so disclosed in the
SEC Documents, other than those incurred in the ordinary course of the Company’s
or its Subsidiaries’ respective businesses and which, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse
Effect.

 

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(s) Absence of Litigation. There is no action, suit, proceeding, inquiry or
investigation before or by the Principal Market, any court, public board,
government agency, self-regulatory organization or body pending or, to the
knowledge of the Company, threatened against or affecting the Company or any of
its Subsidiaries, the Common Stock or any of the Company’s or its Subsidiaries’
officers or directors which individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect. There has not been, and to the
knowledge of the Company, there is not pending or contemplated, any
investigation by the SEC involving the Company or any current or former director
or officer of the Company. The SEC has not issued any stop order or other order
suspending the effectiveness of any registration statement filed by the Company
under the 1934 Act or the 1933 Act.

(t) Insurance. The Company and each of its Subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as management of the Company believes to be prudent and customary in the
businesses in which the Company and its Subsidiaries are engaged. Neither the
Company nor any such Subsidiary has been refused any insurance coverage sought
or applied for, and neither the Company nor any such Subsidiary has any reason
to believe that it will be unable to renew its existing insurance coverage as
and when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business at a cost that would not
reasonably be expected to result in a Material Adverse Effect.

(u) Employee Relations. Neither the Company nor any of its Subsidiaries is a
party to any collective bargaining agreement or employs any member of a union.
The Company believes that its and its Subsidiaries’ relations with their
respective employees are good. No executive officer (as defined in Rule 501(f)
promulgated under the 1933 Act) or other key employee of the Company or any of
its Subsidiaries has notified the Company or any such Subsidiary that such
officer intends to leave the Company or any such Subsidiary or otherwise
terminate such officer’s employment with the Company or any such Subsidiary. No
executive officer or other key employee of the Company or any of its
Subsidiaries is, or is now expected to be, in violation of any material term of
any employment contract, confidentiality, disclosure or proprietary information
agreement, non-competition agreement, or any other contract or agreement or any
restrictive covenant, and the continued employment of each such executive
officer or other key employee (as the case may be) does not subject the Company
or any of its Subsidiaries to any liability with respect to any of the foregoing
matters. The Company and its Subsidiaries are in compliance with all federal,
state, local and foreign laws and regulations respecting labor, employment and
employment practices and benefits, terms and conditions of employment and wages
and hours, except where failure to be in compliance would not, either
individually or in the aggregate, reasonably be expected to result in a Material
Adverse Effect.

(v) Title. The Company and its Subsidiaries have good and marketable title in
fee simple to all real property and good and marketable title to all personal
property owned by them which is material to the business of the Company and its
Subsidiaries, in each case, free and clear of all liens, encumbrances and
defects except such as would not reasonably be expected to materially adversely
affect the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and any of its Subsidiaries.
Any real property and facilities held under lease by the Company or any of its
Subsidiaries are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property and buildings by the Company or any of
its Subsidiaries.

 

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(w) Intellectual Property Rights. The Company and its Subsidiaries own or
possess adequate rights or licenses to use all trademarks, trade names, service
marks, service mark registrations, service names, patents, patent rights,
copyrights, original works, inventions, licenses, approvals, governmental
authorizations, trade secrets and other intellectual property rights and all
applications and registrations therefor (“Intellectual Property Rights”)
necessary to conduct their respective businesses as now conducted and as
presently proposed to be conducted, unless failure to own or possess such rights
or licenses would not reasonably be expected to result in a Material Adverse
Effect. None of the Company’s or its Subsidiaries’ Intellectual Property Rights
have expired, terminated or been abandoned, or are expected to expire, terminate
or be abandoned, within three years from the date of this Agreement, unless such
expiration, termination or abandonment would not reasonably be expected to
result in a Material Adverse Effect. The Company has no knowledge of any
infringement by the Company or any of its Subsidiaries of Intellectual Property
Rights of others. There is no claim, action or proceeding being made or brought,
or to the knowledge of the Company or any of its Subsidiaries, being threatened,
against the Company or any of the Subsidiaries regarding their material
Intellectual Property Rights. The Company is not aware of any facts or
circumstances that reasonably would be expected to give rise to any of the
foregoing infringements or claims, actions or proceedings. The Company and each
of its Subsidiaries have taken reasonable security measures to protect the
secrecy, confidentiality and value of all of their Intellectual Property Rights,
except where failure to do so would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

(x) Environmental Laws. The Company and its Subsidiaries (i) are in compliance
with all Environmental Laws (as defined herein), (ii) have received all permits,
licenses or other approvals required of them under applicable Environmental Laws
to conduct their respective businesses and (iii) are in compliance with all
terms and conditions of any such permit, license or approval where, in each of
the foregoing clauses (i), (ii) and (iii), the failure to so comply would be
reasonably expected to have, individually or in the aggregate, a Material
Adverse Effect. The term “Environmental Laws” means all federal, state, local or
foreign laws relating to pollution or protection of human health or the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata), including, without limitation,
laws relating to emissions, discharges, releases or threatened releases of
chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes
(collectively, “Hazardous Materials”) into the environment, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials, as well as all
authorizations, codes, decrees, demands or demand letters, injunctions,
judgments, licenses, notices or notice letters, orders, permits, plans or
regulations issued, entered, promulgated or approved thereunder.

(y) Subsidiary Rights. Except as disclosed in the SEC Documents, the Company or
one of its Subsidiaries has the unrestricted right to vote, and (subject to
limitations imposed by applicable law and regulation) to receive dividends and
distributions on, all capital securities of its Subsidiaries as owned by the
Company or such Subsidiary.

 

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(z) Tax Status. Except for matters that would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect, the
Company and each of its Subsidiaries (i) has timely made or filed all foreign,
federal and state income and all other tax returns, reports and declarations
required by any jurisdiction to which it is subject, (ii) has timely paid all
taxes and other governmental assessments and charges that are material in
amount, shown or determined to be due on such returns, reports and declarations,
except those being contested in good faith and (iii) has set aside on its books
provision reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Company and its
Subsidiaries know of no basis for any such claim.

(aa) Internal Accounting and Disclosure Controls. The Company maintains internal
control over financial reporting (as such term is defined in Rule 13a-15(f)
under the 1934 Act) that is effective to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles, including that (i) transactions are executed in
accordance with management’s general or specific authorizations,
(ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain asset and liability accountability, (iii) access to assets or
incurrence of liabilities is permitted only in accordance with management’s
general or specific authorization and (iv) the recorded accountability for
assets and liabilities is compared with the existing assets and liabilities at
reasonable intervals and appropriate action is taken with respect to any
difference. The Company maintains disclosure controls and procedures (as such
term is defined in Rule 13a-15(e) under the 1934 Act) that are effective in
ensuring that information required to be disclosed by the Company in the reports
that it files or submits under the 1934 Act is recorded, processed, summarized
and reported, within the time periods specified in the rules and forms of the
SEC, including, without limitation, controls and procedures designed to ensure
that information required to be disclosed by the Company in the reports that it
files or submits under the 1934 Act is accumulated and communicated to the
Company’s management, including its principal executive officer or officers and
its principal financial officer or officers, as appropriate, to allow timely
decisions regarding required disclosure.

(bb) Off Balance Sheet Arrangements. There is no transaction, arrangement, or
other relationship between the Company or any of its Subsidiaries and an
unconsolidated or other off balance sheet entity that is required to be
disclosed by the Company in its 1934 Act filings and is not so disclosed or that
otherwise would reasonably be expected to result in a Material Adverse Effect.

(cc) Investment Company Status. The Company is not, and upon consummation of the
sale of the Shares will not be, an “investment company,” an affiliate of an
“investment company,” a company controlled by an “investment company” or an
“affiliated person” of, or “promoter” or “principal underwriter” for, an
“investment company” as such terms are defined in the Investment Company Act of
1940, as amended.

(dd) Manipulation of Price. Neither the Company nor any of its Subsidiaries has,
and, to the knowledge of the Company, no Person acting on their behalf has,
(i) taken,

 

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directly or indirectly, any action designed to cause or to result in the
stabilization or manipulation of the price of any security of the Company or any
of its Subsidiaries to facilitate the sale or resale of any of the Shares,
(ii) sold, bid for, purchased, or paid any compensation for soliciting purchases
of, any of the Shares, or (iii) paid or agreed to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company or any of its Subsidiaries.

(ee) OFAC. Neither the Company nor any Subsidiary nor, to the Company’s
Knowledge, any director, officer, agent, employee, affiliate or Person acting on
behalf of the Company or any Subsidiary is currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of the U.S.
Treasury Department (“OFAC”); and the Company will not knowingly directly or
indirectly use the proceeds of the sale of the Shares, or lend, contribute or
otherwise make available such proceeds to any Subsidiary, joint venture partner
or other Person or entity, towards any sales or operations in any country
sanctioned by OFAC or for the purpose of financing the activities of any Person
currently subject to any U.S. sanctions administered by OFAC.

(ff) Money Laundering Laws. The operations of each of the Company and any
Subsidiary are and have been conducted at all times in compliance with the money
laundering statutes of applicable jurisdictions, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines, issued,
administered or enforced by any applicable governmental agency (collectively,
the “Money Laundering Laws”) and to the Company’s knowledge, no action, suit or
proceeding by or before any court or governmental agency, authority or body or
any arbitrator involving the Company and/or any Subsidiary with respect to the
Money Laundering Laws is pending or threatened.

(gg) Compliance with Certain Banking Regulations. The Company has no knowledge
of any facts and circumstances, and has no reason to believe that any facts or
circumstances exist, that would cause the Bank: (i) to be deemed not to be in
satisfactory compliance with the Community Reinvestment Act and the regulations
promulgated thereunder or to be assigned a CRA rating by federal or state
banking regulators of lower than “satisfactory”; (ii) to be deemed to be
operating in violation, in any material respect, of the Bank Secrecy Act of 1970
(or otherwise known as the “Currency and Foreign Transactions Reporting Act”),
the USA Patriot Act (or otherwise known as “Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001”), any order issued with respect to anti-money laundering by OFAC or any
other anti-money laundering statute, rule or regulation; or (iii) to be deemed
not to be in satisfactory compliance, in any material respect, with all
applicable privacy of customer information requirements contained in any federal
and state privacy laws and regulations as well as the provisions of all
information security programs adopted by the Bank.

(hh) No Additional Agreements. The Company has not entered into any agreement or
understanding with any Buyer or other individual purchasing Shares with respect
to the transactions contemplated by the Transaction Documents other than as
specified in the Transaction Documents. For the avoidance of doubt, each Buyer
has the same rights with respect to the purchase of Shares as each of the other
Buyers.

 

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(ii) Reports, Registrations and Statements. Since December 31, 2010, the Company
and each Subsidiary have filed all material reports, registrations and
statements, together with any required amendments thereto, that it was required
to file with the Board of Governors of the Federal Reserve System (the “Federal
Reserve”), the FDIC, the NJ Department, and any other applicable federal or
state securities or banking authorities, except where the failure to file any
such report, registration or statement would not reasonably be expected to
result in a Material Adverse Effect. All such reports and statements filed with
any such regulatory body or authority are collectively referred to herein as the
“Company Reports.” As of their respective dates, the Company Reports complied as
to form in all material respects with all the rules and regulations promulgated
by the Federal Reserve, the FDIC, the NJ Department and any other applicable
federal or state securities or banking authorities, as the case may be.

(jj) Adequate Capitalization. As of June 30, 2012, the Bank met or exceeded the
standards necessary to be considered “well capitalized” under the FDIC’s
regulatory framework for prompt corrective action.

(kk) Agreements with Regulatory Agencies. Neither the Company nor any Subsidiary
is a party or subject to any formal agreement or memorandum of understanding
with, or order issued by, or has adopted any board resolutions at the request
of, the Federal Reserve, the FDIC, the NJ Department or any other bank
regulatory authority that imposes any restrictions or requirements not generally
applicable to bank holding companies or commercial banks.

Except as would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, each of the Company and each Subsidiary
has properly administered all accounts for which it acts as a fiduciary,
including accounts for which it serves as a trustee, agent, custodian, personal
representative, guardian, conservator or investment advisor, in accordance with
the terms of the governing documents, applicable federal and state law and
regulation and common law. None of the Company, any Subsidiary or any director,
officer or employee of the Company or any Subsidiary has committed any breach of
trust or fiduciary duty with respect to any such fiduciary account that would
reasonably be expected to result in, individually or in the aggregate, a
Material Adverse Effect and, except as would not reasonably be expected to
result in, individually or in the aggregate, a Material Adverse Effect, the
accountings for each such fiduciary account are true and correct and accurately
reflect the assets of such fiduciary account

(ll) Mortgage Banking Business. Except as has not had and would not reasonably
be expected to result in a Material Adverse Effect:

(i) The Company and each of its Subsidiaries has complied with, and all
documentation in connection with the origination, processing, underwriting and
credit approval of any mortgage loan originated, purchased or serviced by the
Company or any of its Subsidiaries satisfied, (A) all applicable federal, state
and local laws, rules and regulations with respect to the origination, insuring,
purchase, sale, pooling, servicing, subservicing, or filing of claims in
connection with mortgage loans, including all laws relating to real estate
settlement procedures, consumer credit protection, truth in lending laws, usury
limitations, fair housing, transfers of servicing, collection practices, equal

 

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credit opportunity and adjustable rate mortgages, (B) the responsibilities and
obligations relating to mortgage loans set forth in any agreement between the
Company or any of its Subsidiaries and any Agency, Loan Investor or Insurer,
(C) the applicable rules, regulations, guidelines, handbooks and other
requirements of any Agency, Loan Investor or Insurer and (D) the terms and
provisions of any mortgage or other collateral documents and other loan
documents with respect to each mortgage loan; and

(ii) No Agency, Loan Investor or Insurer has (A) claimed in writing that the
Company or any of its Subsidiaries has violated or has not complied with the
applicable underwriting standards with respect to mortgage loans sold by the
Company or any of its Subsidiaries to a Loan Investor or Agency, or with respect
to any sale of mortgage servicing rights to a Loan Investor, (B) imposed in
writing restrictions on the activities (including commitment authority) of the
Company or any of its Subsidiaries or (C) indicated in writing to the Company or
any of its Subsidiaries that it has terminated or intends to terminate its
relationship with the Company or any of its Subsidiaries for poor performance,
poor loan quality or concern with respect to the Company’s or any of its
Subsidiaries’ compliance with laws,

For purposes of this Section 3(ll): (A) “Agency” means the Federal Housing
Administration, the Federal Home Loan Mortgage Corporation, the Farmers Home
Administration (now known as Rural Housing and Community Development Services),
the Federal National Mortgage Association, the United States Department of
Veterans’ Affairs, the Rural Housing Service of the U.S. Department of
Agriculture or any other federal or state agency with authority to (i) determine
any investment, origination, lending or servicing requirements with regard to
mortgage loans originated, purchased or serviced by the Company or any of its
Subsidiaries or (ii) originate, purchase, or service mortgage loans, or
otherwise promote mortgage lending, including state and local housing finance
authorities; (B) “Loan Investor” means any person (including an Agency) having a
beneficial interest in any mortgage loan originated, purchased or serviced by
the Company or any of its Subsidiaries or a security backed by or representing
an interest in any such mortgage loan; and (C) “Insurer” means a person who
insures or guarantees for the benefit of the mortgagee all or any portion of the
risk of loss upon borrower default on any of the mortgage loans originated,
purchased or serviced by the Company or any of its Subsidiaries, including the
Federal Housing Administration, the United States Department of Veterans’
Affairs, the Rural Housing Service of the U.S. Department of Agriculture and any
private mortgage insurer, and providers of hazard, title or other insurance with
respect to such mortgage loans or the related collateral.

(mm) Risk Management Instruments. Except as has not had or would not reasonably
be expected to result in a Material Adverse Effect, since December 31, 2010, all
material 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, were entered into (1) only
in the ordinary course of business, (2) in accordance with prudent practices and
in all material respects with all applicable laws, rules, regulations and
regulatory policies and (3) with counterparties believed to be financially
responsible at the time; and each of them constitutes the valid and legally
binding obligation of the Company or one of the Company Subsidiaries,
enforceable in accordance with its terms. Neither the Company nor the Company
Subsidiaries, nor, to the knowledge of the Company, any other party thereto, is
in breach of any of its material obligations under any such agreement or
arrangement.

 

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(nn) Registration Eligibility. The Company is eligible to register the issuance
and sale of the Shares to the Buyers using Form S-3 promulgated under the 1933
Act.

(oo) Transfer Taxes. On the Closing Date, all stock transfer or other taxes
(other than income or similar taxes) which are required to be paid in connection
with the sale and transfer of the Shares to be sold to each Buyer hereunder will
be, or will have been, fully paid or provided for by the Company, and all laws
imposing such taxes will be or will have been complied with.

(pp) Disclosure. The Company confirms that neither it nor any other Person
acting on its behalf has provided any of the Buyers or their agents or counsel
with any information that constitutes or would reasonably be expected to
constitute material, nonpublic information concerning the Company or any of its
Subsidiaries, other than the existence of the transactions contemplated by this
Agreement and the other Transaction Documents and the existence of the proposed
offering of the Underwritten Shares. The Company understands and confirms that
each of the Buyers will rely on the foregoing representations in effecting
transactions in securities of the Company. All disclosure provided to the Buyers
regarding the Company and its Subsidiaries, their businesses and the
transactions contemplated hereby, including the Schedules to this Agreement,
furnished by or on behalf of the Company or any of its Subsidiaries is true and
correct and does not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements made therein,
in the light of the circumstances under which they were made, not misleading.
Each press release issued by the Company or any of its Subsidiaries during the
twelve (12) months preceding the date of this Agreement did not at the time of
release contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they are made,
not misleading. No event or circumstance has occurred or information exists with
respect to the Company or any of its Subsidiaries or its or their business,
properties, liabilities, prospects, operations (including results thereof) or
conditions (financial or otherwise), which, under applicable law, rule or
regulation, requires public disclosure at or before the date hereof or
announcement by the Company but which has not been so publicly disclosed. The
Company acknowledges and agrees that no Buyer makes or has made any
representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in Section 2.

(qq) Change in Control. The issuance of the Shares to the Buyers as contemplated
by this Agreement will not trigger any rights under any “change of control”
provision in any of the agreements to which the Company or any of its
Subsidiaries is a party, including any employment, “change in control,”
severance or other compensatory agreements and any benefit plan, which results
in payments to the counterparty or the acceleration of vesting of benefits,
except for such payments or acceleration of vesting or benefits that,
individually or in the aggregate, would not be reasonably expected to have a
Material Adverse Effect.

 

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  4. COVENANTS.

(a) Commercially Reasonably Best Efforts. Each Buyer, solely as to itself, shall
use commercially reasonable best efforts timely to satisfy each of the
conditions to the Company’s obligation to issue and sell the Shares set forth in
Section 5(a). The Company shall use commercially reasonable best efforts timely
to satisfy each of the conditions to each Buyer’s obligation to purchase its
Shares set forth in Section 6(a).

(b) Prospectus Supplement and Blue Sky. Immediately prior to execution of this
Agreement, the Company shall have delivered, and as soon as practicable after
execution of this Agreement the Company shall file, the Prospectus Supplement
with respect to the Shares as required under, and in conformity with, the 1933
Act, including Rule 424(b) thereunder. If required, the Company, on or before
the Closing Date, shall take such action as the Company shall reasonably
determine is necessary in order to obtain an exemption for, or to, qualify the
Shares for sale to the Buyers at the Closing pursuant to this Agreement under
applicable securities or “Blue Sky” laws of the states of the United States (or
to obtain an exemption from such qualification), and shall provide evidence of
any such action so taken to the Buyers on or prior to the Closing Date. Without
limiting any other obligation of the Company under this Agreement, the Company
shall timely make all filings and reports relating to the offer and sale of the
Shares required under all applicable securities laws (including, without
limitation, all applicable federal securities laws and all applicable “Blue Sky”
laws), and the Company shall comply with all applicable federal, state and local
laws, statutes, rules, regulations and the like relating to the offering and
sale of the Shares to the Buyers.

(c) Listing. The Company shall promptly secure the listing of all of the Shares
upon each national securities exchange and automated quotation system, if any,
upon which the shares of Common Stock are then listed (subject to official
notice of issuance) and shall maintain such listing of all such Shares on such
national securities exchange or automated quotation system. The Company shall
maintain the Common Stock’s authorization for quotation on the Principal Market,
the New York Stock Exchange, the NYSE Amex, the Nasdaq Global Market or the
Nasdaq Capital Market (each, an “Eligible Market”). The Company shall not take
any action which would be reasonably expected to result in the delisting or
suspension of the Common Stock on an Eligible Market. The Company shall pay all
fees and expenses in connection with satisfying its obligations under this
Section 4(c).

(d) Fees. The Company shall pay the reasonable fees and expenses of Greenberg
Traurig, LLP, counsel on behalf of certain Buyers, incurred in connection with
the transactions contemplated by the Transaction Documents (including, without
limitation, the negotiation, documentation and implementation of the
transactions contemplated by the Transaction Documents and due diligence in
connection therewith), up to a maximum amount of $15,000 which amount shall be
paid by the Company at the Closing or paid by the Company upon termination of
this Agreement so long as such termination did not occur as a result of a
material breach by any such Buyer of any of its obligations hereunder (as the
case may be). Except as set forth above, the parties hereto shall be responsible
for the payment of all expenses incurred by them in connection with the
preparation and negotiation of the Transaction Documents and the consummation of
the transactions contemplated hereby. The Company shall pay all Transfer Agent
fees, stamp taxes and other taxes and duties levied in connection with the sale
and issuance of the Shares to the Buyers.

 

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(e) Disclosure of Transactions and Other Material Information. The Company
shall, on or before 9:15 a.m., New York time, on the first (1st) Business Day
after the date of this Agreement, issue one or more press releases
(collectively, the “Press Release”) reasonably acceptable to each Buyer
disclosing all the material terms of the transactions contemplated hereby and
any other material, nonpublic information that the Company may have provided a
Buyer at any time prior to the filing of the Press Release, including, without
limitation, the pending sale of the Underwritten Shares and the material terms
thereof. On or before 9:15 a.m., New York time, on the first (1st) Business Day
following the date of this Agreement, the Company shall file a Current Report on
Form 8-K describing all the material terms of the transactions contemplated
hereby and attaching this Agreement as an exhibit (including all attachments,
the “8-K Filing”). From and after the issuance of the Press Release, the Company
shall have disclosed all material, nonpublic information delivered to any of the
Buyers by the Company or any of its Subsidiaries, or any of their respective
officers, directors, employees or agents (if any) in connection with the
transactions contemplated by the Transaction Documents. The Company shall not,
and the Company shall cause each of its Subsidiaries and each of its and their
respective officers, directors, employees and agents not to, provide any Buyer
with any material, nonpublic information regarding the Company or any of its
Subsidiaries from and after the issuance of the Press Release without the
express prior written consent of such Buyer. If a Buyer has, or believes it has,
received any material, nonpublic information regarding the Company or any of its
Subsidiaries in breach of the immediately preceding sentence, such Buyer shall
provide the Company with written notice thereof in which case the Company shall,
within one (1) Trading Day of the receipt of such notice, make a public
disclosure of all such material, nonpublic information so provided. In the event
of a breach of any of the foregoing covenants by the Company, any of its
Subsidiaries, or any of its or their respective officers, directors, employees
and agents (as determined in the reasonable good faith judgment of such Buyer),
in addition to any other remedy provided herein or in the Transaction Documents,
such Buyer shall have the right to make a public disclosure, in the form of a
press release, public advertisement or otherwise, of such material, nonpublic
information without the prior approval by the Company, any of its Subsidiaries,
or any of its or their respective officers, directors, employees or agents. No
Buyer shall have any liability to the Company, any of the Subsidiaries, or any
of its or their respective officers, directors, employees, stockholders or
agents, for any such disclosure of such information. Without the prior written
consent of any applicable Buyer, the Company shall not (and shall cause each of
its Subsidiaries and affiliates to not) disclose the name of such Buyer or its
investment adviser in any filing, announcement, release or otherwise, except
(a) as required by federal securities law in connection with the filing of final
Transaction Documents (including signature pages thereto) with the SEC and
(b) to the extent such disclosure is required by law or Principal Market
regulations, in which case the Company shall provide the applicable Buyers with
prior notice of such disclosure permitted hereunder.

(f) Certain Transactions and Confidentiality. Each Buyer, severally and not
jointly with the other Buyers, covenants that it will not execute any purchases
or sales, including Short Sales, of any of the Company’s securities during the
period commencing with the execution of this Agreement and ending at such time
that the transactions contemplated by this Agreement are first publicly
announced pursuant to a press release as described in Section 4(e).

 

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Each Buyer, severally and not jointly with the other Buyers, covenants that
until such time as the transactions contemplated by this Agreement are first
publicly disclosed by the Company pursuant to a press release as described in
Section 4(e), such Buyer will maintain the confidentiality of the existence and
terms of this transaction. Notwithstanding the foregoing, and notwithstanding
anything contained in this Agreement to the contrary, the Company expressly
acknowledges and agrees that (i) no Buyer makes any representation, warranty or
covenant hereby that it will not engage in effecting transactions in any
securities of the Company after the time that the transactions contemplated by
this Agreement are first publicly announced pursuant to a press release as
described in Section 4(e), (ii) no Buyer shall be restricted or prohibited from
effecting any transactions in any securities of the Company in accordance with
applicable securities laws from and after the time that the transactions
contemplated by this Agreement are first publicly announced pursuant to a press
release as described in Section 4(e) and (iii) no Buyer shall have any duty of
confidentiality to the Company or its Subsidiaries after the issuance of a press
release disclosing all the material terms of the transactions contemplated by
this Agreement as described in Section 4(e). Notwithstanding the foregoing, in
the case of a Buyer that is a multi-managed investment vehicle whereby separate
portfolio managers manage separate portions of such Buyer’s assets and the
portfolio managers have no direct knowledge of the investment decisions made by
the portfolio managers managing other portions of such Buyer’s assets, the
covenant set forth above shall only apply with respect to the portion of assets
managed by the portfolio manager that made the investment decision to purchase
the Shares covered by this Agreement.

(g) Avoidance of Control. Notwithstanding anything to the contrary in this
Agreement, neither the Company nor any Subsidiary shall take any action
(including, without limitation, any redemption, repurchase, rescission or
recapitalization of Common Stock, or securities or rights, options or warrants
to purchase Common Stock, or securities of any type whatsoever that are, or may
become, convertible into or exchangeable into or exercisable for Common Stock in
each case, where each Buyer is not given the right to participate in such
redemption, repurchase, rescission or recapitalization to the extent of such
Buyer’s pro rata proportion), that would cause such Buyer’s ownership of any
class of voting securities of the Company (together with the ownership by such
Buyer’s Affiliates (as such term is used under the BHC Act) of voting securities
of the Company) to exceed 9.9%, in each case without the prior written consent
of such Buyer, or to increase to an amount that would constitute “control” under
the BHC Act, the CIBCA or any rules or regulations promulgated thereunder (or
any successor provisions) or otherwise cause such Buyer to “control” the Company
under and for purposes of the BHC Act, the CIBCA or any rules or regulations
promulgated thereunder (or any successor provisions), in each case without the
prior written consent of such Buyer; provided however that the Company shall not
be deemed to be in breach of this Section to the extent that it is taking
actions authorized under other Sections of this Agreement. In the event the
Company breaches its obligations under this Section 4(g) or believes that it is
reasonably likely to breach such an obligation, it shall promptly notify the
Buyers and shall cooperate in good faith with Buyers to modify ownership or make
other arrangements or take any other action, in each case, as is necessary to
cure or avoid such breach.

(h) Preemptive Rights.

(i) If, at any time during a period of 12 months commencing on the

 

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Closing Date, the Company offers to sell Covered Securities (as defined below)
in a public or private offering of Covered Securities for cash (a “Qualified
Offering”), each Buyer shall be afforded the opportunity to acquire from the
Company, for the same price and on the same terms as such Covered Securities are
offered, in the aggregate up to the amount of Covered Securities required to
enable it to maintain its Qualified Buyer Percentage Interest (measured
immediately prior to such offering). “Qualified Buyer Percentage Interest”
means, as of any date of determination, the percentage equal to (A) the sum of
(i) the number of shares of Common Stock then held by such Buyer as of the date
of determination and (ii) the number of shares of Common Stock represented by
any convertible securities held by such Buyer on an as-converted basis as of the
date of determination, divided by (B) the sum of (i) the total number of
outstanding shares of Common Stock as of such date and (ii) the number of shares
of Common Stock represented by such convertible securities on an as-converted
basis. “Covered Securities” means Common Stock and any rights, options or
warrants to purchase or securities convertible into or exercisable or
exchangeable for Common Stock, other than securities that are (A) issuable upon
the exercise or conversion of any securities of the Company issued and
outstanding as of the date hereof; or (B) issued by the Company pursuant to any
employment contract, employee incentive or benefit plan, stock purchase plan,
stock ownership plan, stock option or equity compensation plan or other similar
plan approved by the Company’s board of directors; or (C) issuable under the
Company’s current dividend reinvestment plan or any successor plan; or
(D) Underwritten Shares to be sold to KBW, as Underwriter, including any such
shares subject to the Underwriter’s over-allotment option.

(ii) Prior to making any Qualified Offering of Covered Securities, the Company
shall give each Buyer written notice of its intention to make such an offering,
describing, to the extent then known, the anticipated amount of securities, and
other material terms then known to the Company upon which the Company proposes
to offer the same (such notice, a “Qualified Offering Notice”). The Company
shall deliver such notice only to the individuals identified on such Buyer’s
signature page hereto, and shall not communicate the information to anyone else
acting on behalf of the Buyer without the consent of one of the designated
individuals. Each Buyer shall then have 10 days after receipt of the Qualified
Offering Notice (the “Offer Period”) to notify the Company in writing that it
intends to exercise such preemptive right and as to the amount of Covered
Securities the Buyer desires to purchase, up to the maximum amount calculated
pursuant to Section 4(h)(i) (the “Designated Securities”). Such notice
constitutes a non-binding indication of interest of such Buyer to purchase the
amount of Designated Securities specified by such Buyer (or a proportionately
lesser amount if the amount of Covered Securities to be offered in such
Qualified Offering is subsequently reduced) at the price (or range of prices)
established in the Qualified Offering and other terms set forth in the Company’s
notice to it. The failure to respond during the Offer Period constitutes a
waiver of such Buyer’s preemptive right in respect of such offering. The sale of
the Covered Securities in the Qualified Offering, including any Designated
Securities, shall be closed not later than 30 days after the end of the Offer
Period. The Covered Securities to be sold to other investors in such Qualified
Offering shall be sold at a price not less than, and upon terms no more
favorable to such other investors than, those specified in the Qualified
Offering Notice. If the Company does not consummate

 

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the sale of Covered Securities to other investors within such 30-day period, the
right provided hereunder shall be revived and such securities shall not be
offered unless first reoffered to the Buyers in accordance herewith.
Notwithstanding anything to the contrary set forth herein and unless otherwise
agreed by the Buyers, by not later than the end of such 30-day period, the
Company shall either confirm in writing to the Purchasers that the Qualified
Offering has been abandoned or shall publicly disclose its intention to issue
the Covered Securities in the Qualified Offering, in either case in such a
manner that the Buyers will not be in possession of any material, non-public
information thereafter.

(iii) If a Buyer exercises its preemptive right provided in this Section 4(h)
with respect to a Qualified Offering, the Company shall offer and sell such
Buyer, if any such offering is consummated, the Designated Securities (as
adjusted, upward to reflect the actual size of such offering when priced) at the
same price as the Covered Securities are offered to third persons (not including
the underwriters or the initial purchasers in a Rule 144A offering that is being
reoffered by the initial purchasers) in such offering and shall provide written
notice of such price upon the determination of such price.

(iv) In addition to the pricing provision of Section 4(h)(iii), the Company will
offer and sell the Designated Securities to each Buyer upon terms and conditions
not less favorable than the most favorable terms and conditions offered to other
persons or entities in a Qualified Offering.

(i) Underwritten Shares. The Company covenants and agrees that the Underwritten
Shares, regardless of when sold, shall not be sold at a public offering price
per share less than the Per Share Purchase Price.

 

  5. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.

The obligation of the Company hereunder to issue and sell the Shares to each
Buyer at the Closing is subject to the satisfaction, at or before the Closing
Date, of each of the following conditions, provided that these conditions are
for the Company’s sole benefit and may be waived by the Company at any time in
its sole discretion by providing each Buyer with prior written notice thereof:

(i) All Buyers shall have executed this Agreement and delivered the same to the
Company.

(ii) All Buyers shall have delivered to the Company the Purchase Price for the
Shares being purchased by them at the Closing in accordance with the settlement
mechanics selected by them.

(iii) Each and every representation and warranty of all of the Buyers shall be
true and correct as of the date when made and as of the Closing Date as though
originally made at that time (except for representations and warranties that
speak as of a specific date, which shall be true and correct as of such date),
and all of the Buyers shall have performed, satisfied and complied with the
covenants, agreements and conditions required by this Agreement to be performed,
satisfied or complied with by them Buyer at or prior to the Closing Date.

 

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(iv) The purchase of Shares by any Buyer shall not (i) cause such Buyer or any
of its affiliates to violate any banking regulation, (ii) require such Buyer or
any of its affiliates to file a prior notice under the CIBCA, or otherwise seek
prior approval of any banking regulator, (iii) require such Buyer or any of its
affiliates to become a bank holding company or otherwise serve as a source of
strength for the Company or any Subsidiary or (iv) cause such Buyer, together
with any other person whose Company securities would be aggregated with such
Buyer’s Company securities for purposes of any bank regulation or law, to
collectively be deemed to own, control or have the power to vote securities
which (assuming, for this purpose only, full conversion and/or exercise of such
securities by such Buyer and such other persons) would represent more than 9.9%
of any class of voting securities of the Company outstanding at such time.

 

  6. CONDITIONS TO EACH BUYER’S OBLIGATION TO PURCHASE.

(a) The obligation of each Buyer hereunder to purchase its Shares at the Closing
is subject to the satisfaction, at or before the Closing Date, of each of the
following conditions, provided that these conditions are for each Buyer’s sole
benefit and may be waived by such Buyer at any time in its sole discretion by
providing the Company with prior written notice thereof:

(i) The Company shall have duly executed this Agreement and delivered the same
to such Buyer.

(ii) The Company shall deliver or cause to be delivered to such Buyer the number
of Shares as is set forth below such Buyer’s name on its signature page to this
Agreement in accordance with the settlement mechanics selected by such Buyer.

(iii) Such Buyer shall have received the opinion of the Company’s counsel, dated
as of the Closing Date, in substantially the form attached hereto as Exhibit C.

(iv) Each and every representation and warranty of the Company shall be true and
correct as of the date when made and as of the Closing Date as though made on
and as of such date (except for representations and warranties that speak as of
a specific date, which shall be true and correct as of such date), and the
Company shall have performed, satisfied and complied with the covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Company at or prior to the Closing. Such Buyer shall
have received a certificate, executed by the Chief Executive Officer or Chief
Financial Officer of the Company, dated as of the Closing Date, to the foregoing
effect in the form attached hereto as Exhibit D.

(v) The Common Stock (I) shall be listed on the Principal Market and (II) shall
not have been suspended, as of the Closing Date, by the SEC or the Principal
Market from trading on the Principal Market nor shall suspension by the SEC or
the

 

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Principal Market have been threatened, as of the Closing Date, either (A) in
writing by the SEC or the Principal Market or (B) by falling below the minimum
maintenance requirements of the Principal Market.

(vi) The Company shall have obtained all governmental, regulatory or third party
consents and approvals, if any, necessary for the sale and of the Shares,
including without limitation, those required by the Principal Market.

(vii) The Company shall have obtained approval, if required, of the Principal
Market to list the Shares.

(viii) No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any
court or governmental authority of competent jurisdiction that prohibits the
consummation of any of the transactions contemplated by this Agreement.

(ix) Since the date of execution of this Agreement, no event or series of events
shall have occurred that reasonably would be expected to result in a Material
Adverse Effect.

(x) (A) The Registration Statement shall remain effective at all times up to and
including the Closing Date and the issuance of the Shares to the Buyers may be
made thereunder; (B) neither the Company nor any of the Buyers shall have
received notice that the SEC has issued or intends to issue a stop order with
respect to the Registration Statement or that the SEC otherwise has suspended or
withdrawn the effectiveness of the Registration Statement either, temporarily or
permanently, or intends or has threatened to do so; and (C) no other suspension
of the use or withdrawal of the effectiveness of the Registration Statement or
Prospectus shall exist.

(xi) The Company shall have delivered to such Buyer the Prospectus and
Prospectus Supplement (which may be delivered in accordance with Rule 172 under
the 1933 Act).

(xii) The Company shall have delivered to such Buyer a certificate of the
Secretary of the Company, dated as of the Closing Date, (a) certifying the
resolutions adopted by the Board of Directors of the Corporation or a duly
authorized committee thereof approving the transactions contemplated by this
Agreement and the issuance of the Shares, (b) certifying the current versions of
the Certificate of Incorporation and Bylaws of the Company and (c) certifying as
to the signatures and authority of persons signing this Agreement and related
documents on behalf of the Company, in the form attached hereto as Exhibit E.

(xiii) Intentionally omitted.

(xiv) The purchase of Shares by such Buyer shall not (i) cause such Buyer or any
of its affiliates to violate any banking regulation, (ii) require such Buyer or
any of its affiliates to file a prior notice under the CIBCA, or otherwise seek
prior approval of any banking regulator, (iii) require such Buyer or any of its
affiliates to

 

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become a bank holding company or otherwise serve as a source of strength for the
Company or any Subsidiary or (iv) cause such Buyer, together with any other
person whose Company securities would be aggregated with such Buyer’s Company
securities for purposes of any bank regulation or law, to collectively be deemed
to own, control or have the power to vote securities which (assuming, for this
purpose only, full conversion and/or exercise of such securities by the Buyer
and such other persons) would represent more than 9.9% of any class of voting
securities of the Company outstanding at such time.

 

  7. TERMINATION.

In the event that the Closing shall not have occurred with respect to a Buyer on
or before ten (10) days from the date hereof, then such Buyer shall have the
right to terminate its obligations under this Agreement with respect to itself
at any time on or after the close of business on such date without liability of
such Buyer to any other party; provided, however, (i) the right to terminate
this Agreement under this Section 7 shall not be available to such Buyer if the
failure of the transactions contemplated by this Agreement to have been
consummated by such date is the result of such Buyer’s breach of this Agreement
and (ii) the abandonment of the sale and purchase of the Shares shall be
applicable only to such Buyer providing such written notice, provided further,
notwithstanding any such termination the Company shall remain obligated to
reimburse Greenberg Traurig, LLP for the fees and expenses described in
Section 4(d) above. In the event any Buyer terminates its obligations under this
Agreement under this Section 7, the Company shall promptly notify each other
Buyer in writing of such Buyer’s election to terminate. In addition, in the
event that the Closing shall not have occurred on or before ten (10) days from
the date hereof, the Company shall have the right to terminate this Agreement.
Nothing contained in this Section 7 shall be deemed to release any party from
any liability for any breach by such party of the terms and provisions of this
Agreement or the other Transaction Documents or to impair the right of any party
to compel specific performance by any other party of its obligations under this
Agreement or the other Transaction Documents.

 

  8. MISCELLANEOUS.

(a) Governing Law; Jurisdiction; Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. Each party hereby
irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing

 

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contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT
IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF
ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR
ANY TRANSACTION CONTEMPLATED HEREBY.

(b) Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party. In the event that any signature is delivered by
facsimile transmission or by an e-mail which contains a portable document format
(.pdf) file of an executed signature page, such signature page shall create a
valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such signature page
were an original thereof.

(c) Headings; Gender. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement. Unless the context clearly indicates otherwise, each pronoun herein
shall be deemed to include the masculine, feminine, neuter, singular and plural
forms thereof. The terms “including,” “includes,” “include” and words of like
import shall be construed broadly as if followed by the words “without
limitation.” The terms “herein,” “hereunder,” “hereof” and words of like import
refer to this entire Agreement instead of just the provision in which they are
found.

(d) Severability. If any provision of this Agreement is prohibited by law or
otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or
unenforceable shall be deemed amended to apply to the broadest extent that it
would be valid and enforceable, and the invalidity or unenforceability of such
provision shall not affect the validity of the remaining provisions of this
Agreement so long as this Agreement as so modified continues to express, without
material change, the original intentions of the parties as to the subject matter
hereof and the prohibited nature, invalidity or unenforceability of the
provision(s) in question does not substantially impair the respective
expectations or reciprocal obligations of the parties or the practical
realization of the benefits that would otherwise be conferred upon the parties.
The parties will endeavor in good faith negotiations to replace the prohibited,
invalid or unenforceable provision(s) with a valid provision(s), the effect of
which comes as close as possible to that of the prohibited, invalid or
unenforceable provision(s).

(e) Entire Agreement. This Agreement and the other Transaction Documents,
together with the exhibits and schedules attached hereto and thereto, contain
the entire understanding of the parties solely with respect to the subject
matters contained herein and therein and supersede all prior agreements and
understandings, oral or written, with respect to such subject matter, which the
parties acknowledge have been merged into such documents, exhibits and
schedules, provided that the foregoing shall not have any effect on any
agreements that a Buyer has entered into with the Company or any of its
Subsidiaries prior to the date hereof with respect to any prior investment made
by such Buyer in the Company. The Company confirms that, except as set forth in
this Agreement, no Buyer has made any commitment or promise or has any other
obligation to provide any financing to the Company, and Subsidiary or otherwise.

 

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(f) Amendments; Waivers. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by the
Company and all of the Buyers or, in the case of a waiver, by the party against
whom enforcement of any such waived provision is sought. No waiver of any
default with respect to any provision, condition or requirement of this
Agreement shall be deemed to be a continuing waiver in the future or a waiver of
any subsequent default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of any party to exercise any
right hereunder in any manner impair the exercise of any such right. No
consideration shall be offered or paid to any Buyer to amend or consent to a
waiver or modification of any provision of any of this Agreement unless the same
consideration is also offered to all of the Buyers.

(g) Notices. Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered: (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by facsimile or e-mail (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one (1) Business Day after deposit
with an overnight courier service with next day delivery specified, in each
case, properly addressed to the party to receive the same. The addresses and
facsimile numbers for such communications shall be:

If to the Company:

Lakeland Bancorp, Inc.

250 Oak Ridge Road

Oak Ridge, New Jersey 07438

Telephone: 973-208-6203

Facsimile: 973-208-1507

E-Mail: tshara@lakelandbank.com

Attention: Thomas J. Shara, President and CEO

With copies (for informational purposes only) to:

Lowenstein Sandler PC

1251 Avenue of the Americas

New York, New York 10020

Telephone: (212) 262-6700

Facsimile: (212) 262-7402

E-Mail: pehrenberg@lowenstein.com

Attention: Peter H. Ehrenberg, Esq.

If to a Buyer, to its address and facsimile number set forth on the signature
pages hereto, with copies to such Buyer’s representatives as set forth on the
signature pages hereto, or to such other address and/or facsimile number and/or
to the attention of such other Person as the recipient party has specified by
written notice given to each other party five (5) days prior to the
effectiveness of such change. Written confirmation of receipt (A) given by the
recipient of such notice, consent, waiver or other communication,
(B) mechanically or electronically generated by the sender’s facsimile machine
containing the time, date, recipient facsimile number and an

 

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image of the first page of such transmission or (C) provided by an overnight
courier service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from an overnight courier service in accordance with clause
(i), (ii) or (iii) above, respectively.

(h) Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and assigns. The
Company shall not assign this Agreement or any rights or obligations hereunder
without the prior written consent of each Buyer, including, without limitation,
by way of a merger, consolidation or similar transaction.

(i) No Third Party Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective permitted successors and assigns, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person, other than the Indemnitees referred to in Section 8(l).

(j) Survival. The representations, warranties, agreements and covenants shall
survive the Closing. Each Buyer shall be responsible only for its own
representations, warranties, agreements and covenants hereunder.

(k) Further Assurances. Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as any other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

(l) Indemnification by the Company.

(i) In consideration of each Buyer’s execution and delivery of this Agreement
and acquiring the Shares hereunder and in addition to all of the Company’s other
obligations under the Transaction Documents, the Company shall defend, protect,
indemnify and hold harmless each Buyer and all of their stockholders, partners,
members, officers, directors, employees and direct or indirect investors and any
of the foregoing Persons’ agents or other representatives (including, without
limitation, those retained in connection with the transactions contemplated by
this Agreement) (collectively, the “Indemnitees”) from and against any and all
actions, causes of action, suits, claims, losses, costs, penalties, fees,
liabilities and damages, and expenses in connection therewith (irrespective of
whether any such Indemnitee is a party to the action for which indemnification
hereunder is sought), and including reasonable attorneys’ fees and disbursements
(the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or
arising out of, or relating to (a) any misrepresentation or breach of any
representation or warranty made by the Company in any of the Transaction
Documents, (b) any breach of any covenant, agreement or obligation of the
Company contained in any of the Transaction Documents or (c) any cause of
action, suit or claim brought or made against such Indemnitee by a third party
(including for these purposes a derivative action brought on behalf of the
Company) and arising out of or resulting from (i) the execution, delivery,
performance or enforcement of any of the Transaction Documents, (ii) any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of

 

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the issuance of the Shares, (iii) any disclosure properly made by such Buyer
pursuant to Section 4(e), or (iv) the status of such Buyer as an investor in the
Company pursuant to the transactions contemplated hereby. To the extent that the
foregoing undertaking by the Company may be unenforceable for any reason, the
Company shall make the maximum contribution to the payment and satisfaction of
each of the Indemnified Liabilities which is permissible under applicable law.

(ii) Promptly after receipt by an Indemnitee under this Section 8(l) of notice
of the commencement of any action or proceeding (including any governmental
action or proceeding) involving an Indemnified Liability, such Indemnitee shall,
if a claim in respect thereof is to be made against the Company under this
Section 8(l), deliver to the Company a written notice of the commencement
thereof, and the Company shall have the right to participate in, and, to the
extent the Company so desires, to assume control of the defense thereof with
counsel mutually satisfactory to the Company and the Indemnitee; provided,
however, that an Indemnitee shall have the right to retain its own counsel with
the fees and expenses of such counsel to be paid by the Company if: (i) the
Company has agreed in writing to pay such fees and expenses; (ii) the Company
shall have failed promptly to assume the defense of such Indemnified Liability
and to employ counsel reasonably satisfactory to such Indemnitee in any such
Indemnified Liability; or (iii) the named parties to any such Indemnified
Liability (including any impleaded parties) include both such Indemnitee and the
Company, and such Indemnitee shall have been advised by counsel that a conflict
of interest is likely to exist if the same counsel were to represent such
Indemnitee and the Company (in which case, if such Indemnitee notifies the
Company in writing that it elects to employ separate counsel at the expense of
the Company, then the Company shall not have the right to assume the defense
thereof and such counsel shall be at the expense of the Company), provided
further, that in the case of clause (iii) above the Company shall not be
responsible for the reasonable fees and expenses of more than one (1) separate
legal counsel for the Indemnitees. The Indemnitees shall reasonably cooperate
with the Company in connection with any negotiation or defense of any such
action or Indemnified Liability by the Company and shall furnish to the Company
all information reasonably available to the Indemnitees which relates to such
action or Indemnified Liability. The Company shall keep the Indemnitees
reasonably apprised at all times as to the status of the defense or any
settlement negotiations with respect thereto. The Company shall not be liable
for any settlement of any action, claim or proceeding effected without its prior
written consent, provided, however, that the Company shall not unreasonably
withhold, delay or condition its consent. The Company shall not, without the
prior written consent of the Indemnitees, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnitees of a release from all liability in respect to such Indemnified
Liability or litigation, and such settlement shall not include any admission as
to fault on the part of the Indemnitees. Following indemnification as provided
for hereunder, the Company shall be subrogated to all rights of the Indemnitees
with respect to all third parties, firms or corporations relating to the matter
for which indemnification has been made. The failure to deliver written notice
to the Company within a reasonable time of the commencement of any such action
shall not relieve the Company of any liability to the Indemnitees under this
Section 8(l), except to the extent that the Company is materially and adversely
prejudiced in its ability to defend such action (as determined by a court of
competent jurisdiction, which determination is not subject to appeal or further
review).

 

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(iii) The indemnification required by this Section 8(l) shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Liabilities are
incurred.

(iv) The indemnity agreement contained herein shall be in addition to (A) any
cause of action or similar right of the Indemnitees against the Company or
others, and (B) any liabilities the Company may be subject to pursuant to the
law.

(m) Construction. The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party. For clarification
purposes, the Recitals are part of this Agreement and are hereby incorporated by
reference.

(n) Remedies. Each Buyer shall have all rights and remedies set forth herein and
all rights and remedies which such holders have been granted at any time under
any other agreement or contract and all of the rights which such holders have
under any law. Any Person having any rights under any provision of this
Agreement shall be entitled to enforce such rights specifically (without posting
a bond or other security), to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights granted by law.
Furthermore, the Company recognizes that in the event that it fails to perform,
observe, or discharge any or all of its obligations under the Transaction
Documents, any remedy at law may prove to be inadequate relief to the Buyers.
The Company therefore agrees that the Buyers shall be entitled to seek specific
performance and/or temporary, preliminary and permanent injunctive or other
equitable relief from any court of competent jurisdiction in any such case
without the necessity of proving actual damages and without posting a bond or
other security.

(o) Withdrawal Right. Notwithstanding anything to the contrary contained in (and
without limiting any similar provisions of) the Transaction Documents, whenever
any Buyer exercises a right, election, demand or option under a Transaction
Document and the Company does not timely perform its related obligations within
the periods therein provided, then such Buyer may rescind or withdraw, in its
sole discretion from time to time upon written notice to the Company, any
relevant notice, demand or election in whole or in part without prejudice to its
future actions and rights.

(p) Payment Set Aside. To the extent that the Company makes a payment or
payments to any Buyer hereunder or pursuant to any of the other Transaction
Documents or any of the Buyers enforce or exercise their rights hereunder or
thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company, a trustee,
receiver or any other Person under any law (including, without limitation, any
bankruptcy law, foreign, state or federal law, common law or equitable cause of
action), then to the extent of any such restoration the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such enforcement
or setoff had not occurred.

 

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(q) Independent Nature of Buyers’ Obligations and Rights. The obligations of
each Buyer hereunder are several and not joint with the obligations of any other
Buyer, and no Buyer shall be responsible in any way for the performance of the
obligations of any other Buyer under this Agreement. Nothing contained herein,
and no action taken by any Buyer pursuant hereto, shall be deemed to constitute
the Buyers as, and the Company acknowledges that the Buyers do not so
constitute, a partnership, an association, a joint venture or any other kind of
group or entity, or create a presumption that the Buyers are in any way acting
in concert or as a group or entity with respect to such obligations or the
transactions contemplated by this Agreement or any matters, and the Company
acknowledges that the Buyers are not acting in concert or as a group, and the
Company shall not assert any such claim, with respect to such obligations or the
transactions contemplated by this Agreement. The decision of each Buyer to
purchase Shares pursuant to this Agreement has been made by such Buyer
independently of any other Buyer. Each Buyer acknowledges that no other Buyer
has acted as agent for such Buyer in connection with such Buyer making its
investment hereunder and that no other Buyer will be acting as agent of such
Buyer in connection with monitoring such Buyer’s investment in the Shares or
enforcing its rights under this Agreement. Each Buyer shall be entitled to
independently protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement, and it shall not be necessary for any
other Buyer to be joined as an additional party in any proceeding for such
purpose. It is expressly understood and agreed that each provision contained in
this Agreement and in each other Transaction Document is between the Company and
a Buyer, solely, and not between the Company and the Buyers collectively and not
between and among the Buyers.

[signature pages follow]

 

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IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Agreement to be duly executed as of the date first
written above.

 

COMPANY: LAKELAND BANCORP, INC. By:  

 

  Name: Thomas J. Shara   Title: President and CEO

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURE PAGES FOR BUYERS FOLLOW]

Company Signature Page

 

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BUYER:  

 

By:  

 

Name:  

 

Title:  

 

Aggregate Purchase Price: $ Number of Shares to be Acquired:

Name in which Shares are to be registered:

 

Tax ID No.:

Manner of Settlement of the Shares (check one):             DWAC (see Exhibit A
for instructions)             DVP (see Exhibit B for instructions) Jurisdiction
Where Investment Decision Made: Address for Notice: Telephone No.: Facsimile
No.: E-mail Address: Attention:

Buyer Signature Page

 

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