Exhibit 10.1

 

 

NOTE SUBSCRIPTION AGREEMENT

by and among

Customers Bancorp, Inc.

and Customers Bank,

as issuers,

and

the several purchasers party hereto,

as purchasers

Dated as of June 24, 2014

 

 

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

Table of Contents

 

         Page  

ARTICLE I THE NOTES

     1   

ARTICLE II PURCHASE AND SALE

     1   

Section 2.1

  Purchase and Sale      1   

Section 2.2

  Payment of Purchase Price; Closing      2   

ARTICLE III REPRESENTATIONS AND WARRANTIES OF ISSUERS

     2   

Section 3.1

  Existence and Power      2   

Section 3.2

  Capitalization      2   

Section 3.3

  Financial Statements      3   

Section 3.4

  Tax Matters      3   

Section 3.5

  Ownership of Property      3   

Section 3.6

  Authorization      4   

Section 3.7

  Issuance of Notes      4   

Section 3.8

  Governmental Authorization      4   

Section 3.9

  Non-Contravention      5   

Section 3.10

  No Brokers      5   

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PURCHASERS

     5   

Section 4.1

  Existence and Power      5   

Section 4.2

  Authorization      5   

Section 4.3

  Governmental Authorization      5   

Section 4.4

  Non-Contravention      5   

Section 4.5

  Purchaser Qualifications      6   

Section 4.6

  No Brokers      7   

Section 4.7

  Future or Contemporaneous Transactions Acknowledgement      7   

ARTICLE V CONDITIONS TO CLOSING

     8   

Section 5.1

  Conditions to the Obligations of the Issuers      8   

Section 5.2

  Conditions to the Obligations of the Purchasers      8   

ARTICLE VI MISCELLANEOUS

     8   

Section 6.1

  Transfer Restrictions      8   

 

- i -

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

         Page  

Section 6.2

  Notices      11   

Section 6.3

  Further Assurances      11   

Section 6.4

  Amendments and Waivers      11   

Section 6.5

  Fees and Expenses      12   

Section 6.6

  Successors and Assigns      12   

Section 6.7

  Governing Law      12   

Section 6.8

  Jurisdiction      12   

Section 6.9

  Waiver Of Jury Trial      12   

Section 6.10

  Entire Agreement      12   

Section 6.11

  Effect of Headings and Table of Contents      12   

Section 6.12

  Severability      13   

Section 6.13

  Counterparts; Third Party Beneficiaries      13   

Section 6.14

  Taxes      13   

 

- ii -

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

NOTE SUBSCRIPTION AGREEMENT dated as of June 24, 2014 (this “Agreement”) by and
among Customers Bancorp, Inc. (the “Company”), a Pennsylvania corporation, and
Customers Bank (the “Bank”), a subsidiary of the Company, as issuers (each, an
“Issuer” and collectively, the “Issuers”), and the several purchasers party
hereto (each, a “Purchaser” and collectively, the “Purchasers”).

BACKGROUND

A. The Purchasers wish to subscribe for and purchase (i) from the Company the
Company Notes and (ii) from the Bank the Bank Notes (each as defined below), in
each case in the amount set forth next to each Purchaser’s name in the several
annexes hereto.

B. The Company desires to issue and sell to the Purchasers $25,000,000 aggregate
principal amount of its 4.625% Senior Notes Due 2019 (the “Company Notes”).

C. The Bank desires to issue and sell to the Purchasers $110,000,000 aggregate
principal amount of its Fixed-to-Floating Rate Subordinated Notes Due 2029 (the
“Bank Notes,” and together with the Company Notes, the “Notes”).

In consideration of the mutual covenants and agreements contained in this
Agreement, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:

ARTICLE I

THE NOTES

The Company Notes shall be issued by the Company and the Bank Notes shall be
issued by the Bank, in each case, to the Purchasers pursuant to Article II
hereof and shall be subject to the terms and provisions of the Issuing and
Paying Agency Agreement to be dated on or about June 26, 2014, by and among the
Issuers and U.S. Bank National Association, as issuing and paying agent (the
“IPAA”). The Notes shall be in the forms attached as Annex B-1 and Annex B-2
hereto.

ARTICLE II

PURCHASE AND SALE

Section 2.1 Purchase and Sale. Upon the terms and subject to the conditions of
this Agreement, (a) the Company agrees to issue and sell to the Purchasers, and
each Purchaser agrees to purchase from the Company, an aggregate principal
amount of Company Notes at a purchase price equal to 100% of such principal
amount of such Company Notes, in each case equal to the amount set forth next to
such Purchaser’s name in the several annexes hereto, and (b) the Bank agrees to
issue and sell to the Purchasers, and the Purchasers agree to purchase from the
Bank, an aggregate principal amount of Bank Notes at a purchase price equal to
100% of such principal amount of such Bank Notes equal to the amount set forth
next to such Purchaser’s name in the several annexes hereto. The applicable
purchase price for each series of Notes is referred to herein as the “Purchase
Price” with respect to such series.

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

Section 2.2 Payment of Purchase Price; Closing. Each Issuer will deliver the
Notes to be issued by it to the Purchasers, against payment by or on behalf of
the Purchasers of the applicable Purchase Price therefor (as set forth above in
Section 2.1) to such Issuer by wire transfer in immediately available funds to
the account designated in writing by such Issuer. Delivery of the Notes shall be
through the facilities of The Depository Trust Company. The time and date of
such delivery and payment shall be 9:30 a.m., New York City time, on June 26,
2014, unless otherwise extended by mutual agreement of the parties (such time
being referred to herein as the “Closing”).

To the extent that any payment of the Purchase Price to the Issuer is initiated
by any third party (including any placement agent in respect of the Notes) on
behalf of one or more Purchasers, each Purchaser and the Issuer hereby
acknowledge that such third party shall not be deemed a purchaser of the Notes
for purposes of this Agreement or otherwise, and that any and all obligations of
the Issuer and each Purchaser hereunder shall remain in full force and effect
with respect to each other, and such third party shall not be deemed to have
assumed any obligation or liability hereunder.

The documents to be delivered at the Closing by or on behalf of the parties
hereto pursuant to this Article II, will be delivered at the Closing at the
offices of Sidley Austin LLP, 787 Seventh Avenue, New York, New York (the
“Closing Location”). Final drafts of the documents to be delivered pursuant to
the preceding sentence will be provided to the parties hereto no later than
noon, New York City time, on the day next preceding the Closing.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF ISSUERS

Each of the Issuers represents and warrants to the Purchasers as of the date
hereof that:

Section 3.1 Existence and Power. The Company is duly organized and validly
existing as a corporation in good standing under the laws of the Commonwealth of
Pennsylvania and has all power and authority to enter into and perform its
obligations under this Agreement. The Bank is duly organized and validly
existing as a subsidiary of the Company in good standing under the laws of the
Commonwealth of Pennsylvania and has all power and authority to enter into and
perform its obligations under this Agreement.

Section 3.2 Capitalization. (a) As of the date hereof, the Company has
(i) 100,000,000 authorized shares of voting common stock, par value $1.00 per
share, of which 23,274,409 shares are outstanding, (ii) 100,000,000 authorized
shares of Class B Non-Voting common stock, par value $1.00 per share, of which
1,019,755 shares are outstanding and (iii) 100,000,000 authorized shares of
preferred stock, no par value per share or as determined by the board of
directors of the Company, none of which shares are outstanding; provided that
the number of shares of common stock outstanding does not account for the 10%
stock dividend declared by the board of directors of the Company on May 15, 2014
to be paid to shareholders on June 30, 2014. All of the outstanding shares of
capital stock of the Company have been duly and validly authorized and issued
and are fully paid and non-assessable and were not issued in violation of any
preemptive rights, resale rights, rights of first refusal or similar rights.

 

- 2 -

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

(b) As of the date hereof, the Bank has (i) 40,000,000 authorized shares of
voting common stock, par value $1.00 per share, of which 29,360,720 shares are
outstanding, (ii) 500,000 authorized shares of nonvoting common stock, par value
$1.00 per share, none of which shares are outstanding and (iii) 1,000,000
authorized shares of preferred stock, par value as determined by the board of
directors of the Bank, none of which shares are outstanding. All of the
outstanding shares of capital stock of the Bank have been duly and validly
authorized and issued and are fully paid and non-assessable and were not issued
in violation of any preemptive rights, resale rights, rights of first refusal or
similar rights.

Section 3.3 Financial Statements. The Company has previously made available to
the Purchasers (i) the audited consolidated balance sheets (including related
notes and schedules) of the Company as of December 31, 2013 and 2012 and the
consolidated statements of income, comprehensive income, changes in
shareholders’ equity and cash flows (including related notes and schedules, if
any) of the Company for each of the three (3) years ended December 31, 2013, as
set forth in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2013 (as filed with the United States Securities and Exchange
Commission (the “SEC”) on March 12, 2014) and (ii) the unaudited interim
consolidated financial statements of the Company as of and for the period ended
March 31, 2014, as set forth in the Company’s Quarterly Report on Form 10-Q
(“Form 10-Q”) (as filed by the Company with the SEC on May 8, 2014)
(collectively, the “Company Financial Statements”). The Company Financial
Statements fairly present in each case in all material respects (subject in the
case of the unaudited interim statements to normal adjustments) the consolidated
financial position, results of operations and cash flows of the Company as of
and for the respective periods ending on the dates thereof, in accordance with
GAAP during the periods involved.

Section 3.4 Tax Matters. The Issuers are members of the same affiliated group
within the meaning of Internal Revenue Code Section 1504(a). The Company and the
Bank have timely filed or caused to be filed all tax returns (including, but not
limited to, those filed on a consolidated, combined or unitary basis) required
to have been filed by the Company and the Bank prior to the date hereof, or
requests for extensions to file such returns and reports have been timely filed
(“Tax Returns”). All such Tax Returns are true, correct, and complete in all
material respects.

Section 3.5 Ownership of Property.

Except as set forth in Annex C, such Issuer has good and, as to real property,
marketable title to all assets and properties owned by it in the conduct of its
business, whether such assets and properties are real or personal, tangible or
intangible, including assets and property reflected in the most recent
consolidated balance sheet contained in the Company Financial Statements or
acquired subsequent thereto (except to the extent that such assets and
properties have been disposed of in the ordinary course of business, since the
date of such consolidated balance sheet), subject to no encumbrances, liens,
mortgages, security interests or pledges, except (i) those items which secure
liabilities for public or statutory obligations or any discount with, borrowing
from or other obligations to the Federal Home Loan Bank of

 

- 3 -

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

Pittsburgh, inter-bank credit facilities, reverse repurchase agreements or any
transaction by the Bank acting in a fiduciary capacity, (ii) statutory liens for
amounts not yet delinquent or which are being contested in good faith and
(iii) such as do not, singly or in the aggregate, materially affect the value of
such property and do not materially interfere with the use made and proposed to
be made of such property by such Issuer or its subsidiaries. Each Issuer, as
lessee, has the right under valid and existing leases of real and personal
properties that are material to it in the conduct of its business to occupy or
use all such properties as presently occupied and used by it. Such existing
leases and commitments to lease constitute or will constitute operating leases
for both tax and financial accounting purposes and the lease expense and minimum
rental commitments with respect to such leases and lease commitments are as
disclosed in all material respects in the notes to the Company Financial
Statements.

Section 3.6 Authorization. The execution, delivery and performance of this
Agreement has been authorized by all necessary action on the part of each Issuer
and its Affiliates (as defined below), and this Agreement is a valid and binding
obligation of such Issuer, enforceable against it in accordance with its terms
(except as may be limited by bankruptcy, insolvency, reorganization, moratorium
and other similar laws relating to or affecting creditor’s rights generally and
subject to general principles of equity subject to 12 U.S.C. §1818(b)(6)(D) or
any successor statute and similar bank regulatory powers). For purposes of this
Agreement, “Affiliate” shall mean, with respect to any person, any other person
which directly or indirectly controls or is controlled by or is under common
control with such person; “control” (including its correlative meanings,
“controlled by” and “under common control with”) shall mean possession, directly
or indirectly, of power to direct or cause the direction of management or
policies (whether through ownership of securities or partnership or other
ownership interests, by contract or otherwise); and “person” shall mean an
individual, corporation, association, partnership, trust, joint venture,
business trust or unincorporated organization, or a government or any agency or
political subdivision thereof.

Section 3.7 Issuance of Notes. The Notes have been duly authorized and issued by
the Issuer thereof and, upon execution, authentication, delivery and payment
therefor as provided in this Agreement and the IPAA, will be validly issued and
outstanding, will constitute valid and legally binding obligations of such
Issuer enforceable against it in accordance with their terms (except as may be
limited by bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditor’s rights generally and subject to general
principles of equity and subject to 12 U.S.C. §1818(b)(6)(D) or any successor
statute and similar bank regulatory powers) and will conform in all material
respects to the description thereof set forth in the private placement
memorandum, dated as of June 24, 2014, a copy of which is attached as Annex D
hereto (the “Private Placement Memorandum”).

Section 3.8 Governmental Authorization. As of the date hereof, no permit,
authorization, consent or approval of or by any governmental authority is
required to be obtained or made by either Issuer in connection with the
execution, delivery and performance by it of this Agreement, the consummation by
it of the transactions contemplated hereby or thereby, or the issuance, sale or
delivery to the Purchasers by it of the Notes issued by it, except such as have
been already obtained or, solely with respect to its ability to redeem the Notes
issued by it from time to time, as disclosed in the Private Placement Memorandum
or other information conveyed or specifically made available by the Issuers to
the Purchasers, as set forth in Annex E hereto (the “Disclosure Package”).

 

- 4 -

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

Section 3.9 Non-Contravention. The issuance and sale of the Notes and the
compliance by such Issuer with the provisions of this Agreement and the IPAA and
the consummation of the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, or result in the termination of or
accelerate the performance required by, or result in a right of termination or
acceleration under (A) any provision of the organizational or governing
documents of such Issuer, (B) any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which such Issuer is a party or by
which such Issuer is bound or to which any of the property or assets of such
Issuer is subject or (C) any statute, order, rule or regulation of any court or
governmental agency or body having jurisdiction over such Issuer or any of its
properties; other than in the case of clauses (B) and (C), for conflicts,
breaches, violations, defaults, terminations or accelerations that would not
reasonably be expected to be material to such Issuer.

Section 3.10 No Brokers. Neither Issuer nor its Affiliates have employed any
broker or finder in connection with the transactions contemplated by this
Agreement other than those paid exclusively by such Issuer or its Affiliates.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF PURCHASERS

Each of the Purchasers represent and warrant to each of the Company and the Bank
as of the date hereof that:

Section 4.1 Existence and Power. Such Purchaser is duly organized, validly
existing and in good standing under the laws of the state of its organization
and has all power and authority to enter into and perform its obligations under
this Agreement.

Section 4.2 Authorization. The execution, delivery and performance of this
Agreement has been authorized by all necessary action on the part of such
Purchaser and its Affiliates, and this Agreement is a valid and binding
obligation of such Purchaser, enforceable against it in accordance with its
terms (except as may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditor’s rights
generally and subject to general principles of equity).

Section 4.3 Governmental Authorization. As of the date hereof, no permit,
authorization, consent or approval of or by any governmental authority is
required to be obtained or made by such Purchaser in connection with the
execution, delivery and performance by it of this Agreement, the consummation by
it of the transactions contemplated hereby or thereby, or the issuance, sale or
delivery to such Purchaser by each Issuer of the Notes issued by it.

Section 4.4 Non-Contravention. The execution, delivery and performance of this
Agreement will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, or result in the
termination of or accelerate the

 

- 5 -

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

performance required by, or result in a right of termination or acceleration
under, (A) any provision of the organizational or governing documents of such
Purchaser or (B) any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which such Purchaser is a party or by which such
Purchaser is bound or to which any of the property or assets of such Purchaser
is subject, or (C) any statute, order, rule or regulation of any court or
governmental agency or body having jurisdiction over such Purchaser or any of
its respective properties; other than in the case of clauses (B) and (C), for
conflicts, breaches, violations, defaults, terminations or accelerations that
would not reasonably be expected to adversely impact or delay the ability of
such Purchaser to consummate the transactions contemplated hereby.

Section 4.5 Purchaser Qualifications.

(a) Not Registered Under Securities Act. Each of the Purchasers understands that
(i) the Notes have not been registered under the Securities Act of 1933, as
amended (“Securities Act”) or any state securities laws by reason of their
issuance in a transaction exempt from the registration requirements thereof,
(ii) it may need to hold the Notes indefinitely and continue to bear the
economic risk of its investment in the Notes unless the Notes are subsequently
registered under the Securities Act and such applicable state securities laws or
an exemption from such registrations are available, (iii) it is not anticipated
that there will be any public market for the Notes, (iv) Rule 144 promulgated
under the Securities Act (“Rule 144”) is not presently available with respect to
sales of the Notes, (v) when and if the Notes may be disposed of without
registration in reliance upon Rule 144, such disposition can be made only in
accordance with the terms and conditions of Rule 144 and the provisions of the
IPAA and the Notes, (vi) if the exemption afforded by Rule 144 is not available,
public sale of the Notes without registration will require the availability of
an exemption under the Securities Act, (vii) neither Issuer is presently under
any obligation to register Notes or to make publicly available the information
specified in Rule 144 and neither Issuer may ever be required to do so;
(viii) restrictive legends shall be placed on any certificate representing the
Notes and (ix) a notation shall be made in the appropriate records of the Issuer
thereof indicating that the Notes are subject to restrictions on transfer and,
if such Issuer should in the future engage the services of a transfer agent for
the Notes, appropriate stop-transfer instructions will be issued to such
transfer agent with respect to such Notes.

(b) Accredited Investor. Each Purchaser is an institution that is an “accredited
investor” within the meaning of Rule 501 of Regulation D promulgated under the
Securities Act, is knowledgeable, sophisticated and experienced in making, and
is qualified to make, decisions with respect to investments in securities
representing an investment decision like that involved in the investment in the
Notes, and is acquiring the Notes for its own account for investment only and
not with a view to a resale in connection with any distribution thereof (within
the meaning of the Securities Act);

(c) Information and Risk.

(i) Each Purchaser is familiar with the business and operations of the Company
and the Bank and has requested, received, reviewed and considered all
information such Purchaser deems relevant in making an informed decision to
invest in the Notes. Such Purchaser has had an opportunity to discuss the
Company’s and the Bank’s business, management, prospects and financial affairs
and also had an opportunity to ask questions that were answered to such
Purchaser’s satisfaction;

 

- 6 -

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

(ii) Each Purchaser recognizes that an investment in the Notes involves a high
degree of risk, including a risk of total loss of the Purchaser’s investment.
Each Purchaser is able to bear the economic risk of holding the Notes for an
indefinite period, and has knowledge and experience in the financial and
business matters such that it is capable of evaluating the risks of the
investment in the Notes and understands such risks, including, but not limited
to, those set forth and incorporated by reference under the caption “Risk
Factors” in the Private Placement Memorandum and understands that there is no
existing market for the Notes and there is no expectation that any such market
will exist in the future;

(iii) Each Purchaser represents and warrants that it has been given access to
information regarding the Company and the Bank and has utilized such access to
its satisfaction for the purpose of obtaining such information concerning the
Company, the Bank and the Notes as each Purchaser has deemed necessary to make
an investment decision; and

(iv) Each Purchaser has, in connection with such Purchaser’s decision to acquire
the Notes as set forth in the several annexes hereto, not relied upon any
representations or other information (whether oral or written) with respect to
the Company or the Bank or their respective Affiliates other than the
information contained or incorporated by reference in the Disclosure Package and
the representations and warranties contained in this Agreement, and such
Purchaser has, with respect to all matters relating to the issuance of the
Notes, relied solely upon the advice of such Purchaser’s own counsel and has not
relied upon or consulted counsel to the Company, the Bank or their respective
Affiliates.

(d) Denominations. Each Purchaser understands that the Notes must be held in
minimum denominations of $1,000 and cannot be exchanged for Notes in smaller
denominations and that each certificate representing Notes will bear a legend to
the foregoing effect.

(e) Financial Capacity. Such Purchaser has the funds on hand or available to it
to pay the Purchase Price applicable to such Purchaser on the terms set forth
herein.

Section 4.6 No Brokers. None of the Purchasers nor any of their respective
Affiliates has employed any broker or finder in connection with the transactions
contemplated by this Agreement other than those paid exclusively by such
Purchaser or its Affiliates.

Section 4.7 Future or Contemporaneous Transactions Acknowledgement. Each
Purchaser acknowledges that, from time to time, each Issuer may issue and sell
its debt and that such debt securities may have different terms than the Notes
or the transactions may be on different terms and conditions than those
contemplated under this Agreement.

 

- 7 -

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

ARTICLE V

CONDITIONS TO CLOSING

Section 5.1 Conditions to the Obligations of the Issuers. The obligations of
each Issuer hereunder shall be subject to the following conditions:

(a) All representations and warranties and other statements of the Purchasers
herein are, at and as of the Closing, shall be true and correct; and

(b) Each of the Purchasers shall have performed all of its obligations hereunder
theretofore to be performed.

Section 5.2 Conditions to the Obligations of the Purchasers. The obligations of
each Purchaser hereunder shall be subject to the following conditions:

(a) All representations and warranties and other statements of the Issuers
herein are, at and as of the Closing, shall be true and correct; and

(b) Each Issuer shall have performed all of its obligations hereunder
theretofore to be performed.

ARTICLE VI

MISCELLANEOUS

Section 6.1 Transfer Restrictions. Each Purchaser, and any other holder of the
Notes pursuant to a transfer permitted hereunder shall be permitted to transfer
the Notes only in compliance with the transfer restrictions set forth in the
Private Placement Memorandum, the IPAA and the Notes. Any such transfer must be
made in compliance with the registration requirements of the Securities Act or
any other applicable securities laws, pursuant to an exemption therefrom or in a
transaction not subject thereto, and unless the Notes are registered pursuant to
the Securities Act, any such transfer shall be subject to the requirement that
each Purchaser provide evidence to the reasonable satisfaction of the Issuer
thereof that the proposed transferee satisfies the requirements and conditions
for the relevant exemption under the Securities Act. Each Purchaser understands
and agrees that legends to the following effect will be placed on any
certificate evidencing Notes issued to such Purchaser (as may be modified by the
Issuers and the Issuing and Paying Agent from time to time):

FOR COMPANY NOTES:

THE INDEBTEDNESS EVIDENCED BY THIS NOTE IS NOT A DEPOSIT AND IS NOT INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE “FDIC”) OR ANY OTHER GOVERNMENT
AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS NOTE IS EFFECTIVELY SUBORDINATED TO SECURED
INDEBTEDNESS OF CUSTOMERS BANCORP, INC. (THE “COMPANY”) (TO THE EXTENT OF SUCH
SECURITY), IS STRUCTURALLY SUBORDINATED TO DEPOSITS AND LIABILITIES OF CUSTOMERS
BANK (THE “BANK”) AND IS UNSECURED AND INELIGIBLE TO SERVE AS COLLATERAL TO
SECURE A LOAN FROM THE BANK.

 

- 8 -

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

EACH NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF
$1,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF A
NOTE IN A DENOMINATION OF LESS THAN $1,000 SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER AND MAY BE DISREGARDED BY THE COMPANY OR ANY OF ITS
AGENTS. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF
SUCH NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
PAYMENTS ON SUCH NOTE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO
INTEREST WHATSOEVER IN SUCH NOTE.

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REQUIREMENTS OF THE SECURITIES ACT. THIS NOTE IS ISSUED SUBJECT
TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF A SUBSCRIPTION
AGREEMENT, DATED JUNE 24, 2014, BY AND AMONG THE COMPANY AND THE BANK, AS
ISSUERS, AND THE PURCHASERS REFERRED TO THEREIN AND AN ISSUING AND PAYING AGENCY
AGREEMENT, DATED JUNE 26, 2014 (THE “ISSUING AND PAYING AGENCY AGREEMENT”), BY
AND BETWEEN THE COMPANY AND U.S. BANK NATIONAL ASSOCIATION, AS ISSUING AND
PAYING AGENT, COPIES OF WHICH, IN EACH CASE, ARE ON FILE WITH THE COMPANY. THIS
NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENTS. ANY SALE
OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENTS WILL BE VOID.

THIS IS A GLOBAL NOTE WITHIN THE MEANING OF SECTION 2 OF THE ISSUING AND PAYING
AGENCY AGREEMENT.

UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATED
NOTE ISSUED IN EXCHANGE FOR THIS NOTE OR ANY PORTION HEREOF IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) PURSUANT TO AND
IN ACCORDANCE WITH THE ISSUING AND PAYING AGENCY AGREEMENT, ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON OTHER
THAN DTC OR A NOMINEE THEREOF IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

- 9 -

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

FOR BANK NOTES:

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS NOT A DEPOSIT AND IS NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE “FDIC”) OR ANY OTHER
GOVERNMENT AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS SUBORDINATED AND JUNIOR
IN RIGHT OF PAYMENT TO THE OBLIGATIONS OF CUSTOMERS BANK (THE “BANK”) TO ITS
GENERAL AND SECURED CREDITORS (TO THE EXTENT OF SUCH SECURITY), TO DEPOSITS AND
LIABILITIES OF THE BANK AND IS UNSECURED AND INELIGIBLE AS COLLATERAL FOR A LOAN
BY THE BANK OR ANY OF ITS SUBSIDIARIES.

EACH SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM
DENOMINATIONS OF $1,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED
TRANSFER OF A SUBORDINATED NOTE IN A DENOMINATION OF LESS THAN $1,000 SHALL BE
DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER AND MAY BE DISREGARDED BY
THE BANK OR ANY OF ITS AGENTS. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT
TO BE THE HOLDER OF SUCH SUBORDINATED NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT
LIMITED TO, THE RECEIPT OF PAYMENTS ON SUCH SUBORDINATED NOTE, AND SUCH
PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH
SUBORDINATED NOTE.

THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REQUIREMENTS OF THE SECURITIES ACT. THIS
SUBORDINATED NOTE IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER, EXERCISE
AND OTHER PROVISIONS OF A SUBSCRIPTION AGREEMENT, DATED JUNE 24, 2014, BY AND
AMONG CUSTOMERS BANCORP, INC. (THE “COMPANY”) AND THE BANK, AS ISSUERS, AND THE
PURCHASERS REFERRED TO THEREIN AND AN ISSUING AND PAYING AGENCY AGREEMENT, DATED
JUNE 26, 2014, BY AND AMONG THE COMPANY AND THE BANK, AS ISSUERS, AND U.S. BANK
NATIONAL ASSOCIATION, AS ISSUING AND PAYING AGENT. COPIES OF WHICH, IN EACH
CASE, ARE ON FILE WITH THE BANK. THIS SUBORDINATED NOTE MAY NOT BE TRANSFERRED
OR EXERCISED EXCEPT IN COMPLIANCE WITH SAID AGREEMENTS. ANY SALE OR OTHER
TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENTS WILL BE VOID.

 

- 10 -

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

THIS IS A GLOBAL NOTE WITHIN THE MEANING OF SECTION 2 OF THE ISSUING AND PAYING
AGENCY AGREEMENT.

UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE BANK OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATED
NOTE ISSUED IN EXCHANGE FOR THIS NOTE OR ANY PORTION HEREOF IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON OTHER
THAN DTC OR A NOMINEE THEREOF IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

Section 6.2 Notices. All notices and other communications required or permitted
to be given under this Agreement shall be in writing and shall be deemed to have
been given if delivered personally or by facsimile or seven days after having
been sent by certified mail, return receipt requested, postage prepaid, to the
parties to this Agreement at the following address or to such other address
either party to this Agreement shall specify by notice to the other party: (i)
If to the Issuers:

Customers Bancorp, Inc.

1015 Penn Avenue, Suite 103

Wyomissing, Pennsylvania 19610

Attention: Robert E. Wahlman

Fax: (610) 374-5160

Customers Bank

1015 Penn Avenue, Suite 103

Wyomissing, Pennsylvania 19610

Attention: Robert E. Wahlman

Fax: (610) 374-5160

 

  (ii) If to the Purchasers, as may be specified in the relevant annex hereto.

Section 6.3 Further Assurances. Each party hereto shall do and perform or cause
to be done and performed all further acts and shall execute and deliver all
other agreements, certificates, instruments and documents as any other party
hereto reasonably may request in order to carry out the intent and accomplish
the purposes of this Agreement and the consummation of the transactions
contemplated hereby.

Section 6.4 Amendments and Waivers.

(a) Any provision of this Agreement may be amended or waived if, but only if,
such amendment or waiver is in writing and is duly executed and delivered by the
Company, the Bank and the Purchasers; and

 

- 11 -

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

(b) No failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.

Section 6.5 Fees and Expenses. Each party hereto shall pay all of its own fees
and expenses (including attorneys’ fees) incurred in connection with this
Agreement and the transactions contemplated hereby.

Section 6.6 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, provided that neither party may assign, delegate or
otherwise transfer any of its rights or obligations under this Agreement without
the consent of the other party hereto.

Section 6.7 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

Section 6.8 Jurisdiction. The parties hereto agree that any suit, action or
proceeding seeking to enforce any provision of, or based on any matter arising
out of or in connection with, this Agreement or the transactions contemplated
hereby may only be brought in the United States District Court for the Southern
District of New York or any New York State court sitting in the Borough of
Manhattan in New York City, and each of the parties hereby consents to the
jurisdiction of such courts (and of the appropriate appellate courts therefrom)
in any such suit, action or proceeding and irrevocably waives, to the fullest
extent permitted by law, any objection which it may now or hereafter have to the
laying of the venue of any such suit, action or proceeding in any such court or
that any such suit, action or proceeding which is brought in any such court has
been brought in an inconvenient forum. Process in any such suit, action or
proceeding may be served on any party anywhere in the world, whether within or
without the jurisdiction of any such court.

Section 6.9 Waiver Of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 6.10 Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter of this Agreement and
supersedes all prior agreements and understandings, both oral and written,
between the parties and/or their Affiliates with respect to the subject matter
of this Agreement.

Section 6.11 Effect of Headings and Table of Contents. The Article and Section
headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.

 

- 12 -

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

Section 6.12 Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision shall be deemed to be
excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision were so excluded and shall be enforced in
accordance with its terms to the maximum extent permitted by law.

Section 6.13 Counterparts; Third Party Beneficiaries. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures were upon the same instrument. No provision
of this Agreement shall confer upon any person other than the parties hereto any
rights or remedies hereunder.

Section 6.14 Taxes. The Purchasers shall be responsible for and shall timely pay
all taxes imposed on Purchasers as a result of the acquisition or ownership of
the Notes issued hereunder.

 

- 13 -

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

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

 

Customers Bancorp, Inc. By:     Name: Robert E. Wahlman Title: Executive Vice
President and CFO Customers Bank By:     Name: Robert E. Wahlman Title:
Executive Vice President and CFO

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

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

 

[INVESTOR] By:     Name: Title:

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

Annex A

 

Name of Purchaser

  

Amount of Company

Notes Purchased

  

Amount of Bank

Notes Purchased

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

Annex B-1

[Form of Company Note]

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

SENIOR NOTE CERTIFICATE

CUSTOMERS BANCORP, INC.

4.625% Senior Notes Due 2019

THE INDEBTEDNESS EVIDENCED BY THIS NOTE IS NOT A DEPOSIT AND IS NOT INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE “FDIC”) OR ANY OTHER GOVERNMENT
AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS NOTE IS EFFECTIVELY SUBORDINATED TO SECURED
INDEBTEDNESS OF CUSTOMERS BANCORP, INC. (THE “COMPANY”) (TO THE EXTENT OF SUCH
SECURITY), IS STRUCTURALLY SUBORDINATED TO DEPOSITS AND LIABILITIES OF CUSTOMERS
BANK (THE “BANK”) AND IS UNSECURED AND INELIGIBLE TO SERVE AS COLLATERAL TO
SECURE A LOAN FROM THE BANK.

EACH NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF
$1,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF A
NOTE IN A DENOMINATION OF LESS THAN $1,000 SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER AND MAY BE DISREGARDED BY THE COMPANY OR ANY OF ITS
AGENTS. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF
SUCH NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
PAYMENTS ON SUCH NOTE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO
INTEREST WHATSOEVER IN SUCH NOTE.

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REQUIREMENTS OF THE SECURITIES ACT. THIS NOTE IS ISSUED SUBJECT
TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF A SUBSCRIPTION
AGREEMENT, DATED JUNE 24, 2014, BY AND AMONG THE COMPANY AND THE BANK, AS
ISSUERS, AND THE PURCHASERS REFERRED TO THEREIN AND AN ISSUING AND PAYING AGENCY
AGREEMENT, DATED JUNE 26, 2014 (THE “ISSUING AND PAYING AGENCY AGREEMENT”), BY
AND BETWEEN THE COMPANY, THE BANK AND U.S. BANK NATIONAL ASSOCIATION, AS ISSUING
AND PAYING AGENT, COPIES OF WHICH, IN EACH CASE, ARE ON FILE WITH THE COMPANY.
THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENTS. ANY
SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENTS WILL BE VOID.

THIS IS A GLOBAL NOTE WITHIN THE MEANING OF SECTION 2 OF THE ISSUING AND PAYING
AGENCY AGREEMENT.

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

UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATED
NOTE ISSUED IN EXCHANGE FOR THIS NOTE OR ANY PORTION HEREOF IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) PURSUANT TO AND
IN ACCORDANCE WITH THE ISSUING AND PAYING AGENCY AGREEMENT, ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON OTHER
THAN DTC OR A NOMINEE THEREOF IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

2

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

Registered No. 1                        Principal Amount:    $25,000,000   
                    CUSIP:    23204GAA8

CUSTOMERS BANCORP, INC.

4.625% Senior Notes Due 2019

1. Payment.

(a) CUSTOMERS BANCORP, INC., a company incorporated under the laws of the
Commonwealth of Pennsylvania (the “Issuer”), for value received, hereby promises
to pay to Cede & Co., or registered assigns, as nominee of DTC, the principal
sum of Twenty-Five Million Dollars ($25,000,000) on June 26, 2019 (the “Maturity
Date”) and to pay interest thereon at the rate of 4.625% per year (computed on
the basis of a 360-day year of twelve 30-day months) from and including June 26,
2014 to the Maturity Date or any early redemption date (the “Interest Payment
Dates”); payable semi-annually in arrears, on June 26 and December 26 of each
year. The first Interest Payment Date shall be December 26, 2014.

(b) If any Interest Payment Date or the Maturity Date is not a Business Day,
then the payment will be made on the next succeeding Business Day and no
interest will accrue as a result of such postponement. A “Business Day” means
any day other than a Saturday, Sunday, federal holiday or day on which banks in
the State of New York are authorized or obligated by law or executive order to
close.

2. Senior Notes, Noteholders. This Senior Note is a duly authorized issue of
notes of the Issuer designated as 4.625% Senior Notes Due 2019 (herein called
the “Senior Notes” or the “Notes”) issued under the Issuing and Paying Agency
Agreement, dated as of June 26, 2014 (the “Issuing and Paying Agency
Agreement”), among Customers Bank, the Issuer and U.S. Bank National
Association, as Issuing and Paying Agent (herein called the “Issuing and Paying
Agent,” which term includes any successor issuing and paying agent under the
Issuing and Paying Agency Agreement) and reference is hereby made to the Issuing
and Paying Agency Agreement for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Issuer and the
Issuing and Paying Agent and of the terms upon which the Senior Notes are, and
are to be, authenticated and delivered. The holder in whose name any Senior
Notes are registered on the Security Register (as defined herein) is referred to
as a “Noteholder,” and such holders collectively are referred to as the
“Noteholders.”

3. Optional Redemption. The Issuer may, at its option, redeem some or all of the
Senior Notes at a redemption price equal to the greater of (1) 100% of the
aggregate principal amount of the Senior Notes to be redeemed or (2) as
determined by the Quotation Agent (defined below), the sum of the present value
of the remaining scheduled payments of principal on the Senior Notes, together
with the present value of all remaining and scheduled semi-annual interest
payments on the Senior Notes, in each case discounted to the early redemption
date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day
months) at the Treasury Rate (defined below) plus 45 basis points (0.45%) (the
“Make-Whole Redemption Price”), together in each case with accrued interest
payments to the early redemption date. For purposes of determining the
Make-Whole Redemption Price, the following definitions apply:

“Comparable Treasury Issue” means the United States Treasury security selected
by the Quotation Agent as having a maturity comparable to the remaining term of
the Senior Notes to be redeemed that would be utilized at the time of selection,
and in accordance with customary financial practice, in pricing new issues of
corporate debt securities of comparable maturity to the remaining term of the
Senior Notes.

 

3

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

“Comparable Treasury Price” means with respect to any early redemption date
(1) the average of three Reference Treasury Dealer Quotations for the early
redemption date, after excluding the highest and the lowest of five Reference
Treasury Dealer Quotations, or (2) if fewer than five Reference Treasury Dealer
Quotations are obtained, the average of all Reference Treasury Dealer
Quotations.

“Quotation Agent” means a Reference Treasury Dealer appointed by U.S. Bancorp
Investments, Inc.

“Reference Treasury Dealer” means a primary independent United States government
securities dealer.

“Reference Treasury Dealer Quotations” means with respect to each Reference
Treasury Dealer and any early redemption date, the average, as determined by the
Quotation Agent, of bid and asked prices for the Comparable Treasury Issue
(expressed, in each case, as a percentage of its principal amount) quoted in
writing to the Quotation Agent by such Reference Treasury Dealer at 3:30 p.m.,
New York City time, on the third (3rd) Business Day preceding the early
redemption date.

“Treasury Rate” means the rate per annum equal to the semi-annual equivalent or
interpolated (on a daycount basis) yield to maturity of the Comparable Treasury
Issue, assuming a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
that early redemption date.

The Issuer will notify Noteholders of the Senior Notes to be redeemed at least
30 but not more than 60 days before the scheduled redemption (which notice may
be conditional). If the Issuer is redeeming less than all the Senior Notes, the
Issuing and Paying Agent under the Issuing and Paying Agency Agreement must
select the Senior Notes to be redeemed by lot or by such other method as the
Issuing and Paying Agent deems fair and appropriate, subject to the rules and
procedures of DTC.

On and after any early redemption date, interest will cease to accrue on the
Senior Notes called for redemption. On or prior to any early redemption date,
the Issuer is required to deposit with the Issuing and Paying Agent money
sufficient to pay the redemption price of and accrued interest on the Senior
Notes to be redeemed on such date.

 

4

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

4. Consolidation, Merger and Sale of Assets. The Issuer shall not consolidate
with or merge into another person or entity, or convey or transfer its
properties and assets substantially as an entirety to any person or entity,
unless:

(a) the person or entity formed by such consolidation or into which the Issuer
is merged or the person or entity which acquires by conveyance or transfer the
properties and assets of the Issuer substantially as an entirety is a
corporation, partnership, limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or any other entity
organized and existing under the laws of the United States of America, any State
thereof or the District of Columbia and expressly assumes, by a supplemental
agreement, the due and punctual payment of the principal of and any interest on
the Senior Notes according to their terms, and the due and punctual performance
and observance of all covenants and conditions to be performed by the Issuer
contained in this Note and the Issuing and Paying Agency Agreement (as such
terms relate to the Notes); and

(b) immediately after giving effect to such transaction, no Event of Default (as
defined below), and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be continuing.

Upon any such consolidation or merger, or conveyance or transfer, the successor
entity or person formed, or into which the Issuer is merged or to which such
conveyance or transfer is made, shall succeed to, and be substituted for, the
Issuer under the Issuing and Paying Agency Agreement, and the Issuer shall be
released from all of its obligations pursuant thereto.

5. Limitation on Disposition of Stock by the Issuer. The Issuer shall not,
directly or indirectly, sell, assign or grant a security interest in or
otherwise dispose of any shares of the voting stock of Customers Bank (the
“Bank”), or any securities convertible into or options, warrants or rights to
subscribe for or purchase shares of voting stock of the Bank, nor will the
Issuer permit the issuance of any shares of, or securities convertible into, or
options, warrants or rights to subscribe for or purchase shares of, voting stock
of the Bank.

The foregoing restrictions in this Section 5 are subject to the Issuer’s rights
in connection with a consolidation or merger of the Issuer with another person
or a conveyance, transfer or lease of all or substantially all of the Issuer’s
assets to another person in accordance with Section 4 hereof. In addition, the
foregoing restrictions in this Section 5 shall not apply if both (i) such sale,
assignment, grant, disposition or issuance is made for fair market value, as
determined by the board of directors of the Issuer; and (ii) after giving effect
to such sale, assignment, grant, disposition or issuance, the Issuer will own,
directly or indirectly, at least 80% of the issued and outstanding voting stock
of the Bank or any successor to the Bank.

This foregoing restrictions in this Section 5 also shall not restrict the Issuer
from being consolidated with or merged into another domestic banking institution
if, after the merger or consolidation, the Issuer, or its successor, owns,
directly or indirectly, at least 80% of the voting stock of the resulting bank,
free and clear of any security interest. The above covenant shall also not
prohibit a pledge made or a lien created (i) to secure loans or other extensions
of credit by the Bank subject to Section 23A of the Federal Reserve Act, (ii) on
directors’ qualifying shares, (iii) for taxes, assessments or other governmental
charges or levies (a) which are not yet due or are payable without penalty,
(b) which the Issuer is contesting in good faith by appropriate proceedings so
long as it has set aside on its books such reserves as shall be required in
conformity with applicable generally accepted accounting principles or (c) which
secures obligations of less than $7.5 million in amount, or (iv) in respect of
any judgment if that

 

5

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

judgment (a) is discharged or stayed on appeal or otherwise within 60 days,
(b) is being contested in good faith by appropriate proceedings so long as the
Issuer has set aside on its books such reserves as shall be required in respect
thereof in conformity with applicable generally accepted accounting principles
or (c) involves claims of less than $25 million.

The foregoing restrictions in this Section 5 also shall not prohibit sales,
assignments, pledges, transfers or other dispositions or issuances that are made
(i) to a direct or indirect wholly-owned (except for directors’ qualifying
shares) subsidiary of the Issuer, (ii) in compliance with an order of a court or
regulatory authority of competent jurisdiction, (iii) in compliance with a
condition imposed by or an undertaking made to any such court or regulatory
authority in connection with an acquisition by the Issuer, directly or
indirectly, of any other person, (iv) if required by law for the qualification
of directors, or (v) by the Issuer or any of its subsidiaries acting in a
fiduciary capacity for any other person or entity other than the Issuer or any
of its subsidiaries or (vi) (in the case of sales, assignments, transfers,
dispositions or issuances) to the stockholders of the Bank at any price if,
after that sale, the Issuer owns directly or indirectly not less than the
percentage of voting stock of the Bank that the Issuer owned prior to such sale.

As used in this Section 5, “voting stock” means a class of stock having general
voting power under ordinary circumstances to elect at least a majority of the
board of directors, managers or trustees irrespective of the happening of a
contingency.

6. Events of Default; Acceleration. If any of the following events shall occur
and be continuing (each an “Event of Default”):

 

  (a) default in the payment of interest on the Senior Notes and continuance of
that default for 30 days;

 

  (b) default in the payment of the principal of, or premium, if any, on, the
Senior Notes when due and payable, whether at their Maturity Date or by
acceleration, call for redemption or otherwise;

 

  (c) failure by the Issuer for 90 days after notice by the Noteholders to
perform any of the other covenants or agreements in the Senior Notes and the
Issuing and Paying Agency Agreement;

 

  (d) an event of default, as defined in any bond, note, debenture or other
evidence of indebtedness for borrowed money of the Issuer or under any mortgage,
indenture, trust agreement or other instrument securing, evidencing or providing
for any indebtedness for borrowed money of the Issuer as a result of which
indebtedness for borrowed money of the Issuer in excess of $25 million in
aggregate principal amount shall be or become accelerated so as to be due and
payable prior to the date on which the same would otherwise become due and
payable and such acceleration shall not have been annulled or rescinded within
30 days of the notice of such acceleration to the Issuer;

 

  (e) the Issuer shall consent to the appointment of a receiver, liquidator,
trustee or other similar official in any bankruptcy, liquidation, insolvency or
similar proceeding; or

 

6

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

  (f) a court or other governmental agency or body having jurisdiction shall
enter a decree or order for the appointment of a receiver, liquidator, trustee
or other similar official in any bankruptcy, receivership, liquidation,
insolvency or similar proceeding with respect to the Issuer and such decree or
order shall have remained in force for 30 days.

In each such case, unless the principal of the Senior Notes already shall have
become due and payable, the holders of 100% of the aggregate principal amount of
the Senior Notes, by notice in writing to the Issuer, may declare the principal
amount of the Senior Notes to be due and payable immediately, and upon any such
declaration the same shall become and shall be immediately due and payable.

7. Payment Procedures. Payment of the principal and interest payable on the
Maturity Date will be made by wire transfer in immediately available funds to a
bank account in the United States designated by the Noteholder, upon
presentation and surrender of this Note at the office of the Issuer or at such
other place or places as the Issuer shall designate by notice to the
Noteholders, provided that this Note is presented to the Issuer in time for the
Issuer to make such payments in such funds in accordance with its normal
procedures. Payments of interest (other than interest payable on the Maturity
Date or upon early redemption) shall be made by wire transfer in immediately
available funds or check mailed to the person entitled thereto, as such person’s
address appears on the Security Register maintained by the Issuing and Paying
Agent as of the applicable Regular Record Date or to such other address in the
United States as any Noteholder shall designate to the Issuing and Paying Agent
in writing not later than the relevant Regular Record Date. Interest payable on
any Interest Payment Date shall be payable to the holder in whose name this Note
is registered at the close of business on the fifteenth calendar day (whether or
not a Business Day) immediately preceding the applicable Interest Payment Date
(such date being referred to herein as the “Regular Record Date”), except that
interest not punctually paid may be paid to the Noteholder in whose name this
Note is registered at the close of business on a Special Record Date fixed by
the Issuer (a “Special Record Date”), notice of which shall be given to the
holder not less than 15 calendar days prior to such Special Record Date. (The
Regular Record Date and Special Record Date are referred to herein collectively
as the “Record Dates”). To the extent permitted by applicable law, interest
shall accrue, at the rate at which interest accrues on the principal of this
Note, on any amount of principal of or interest on this Note not paid when due.
All payments on this Note shall be applied first to accrued interest and then
the balance, if any, to principal.

9. Form of Payment, Maintenance of Payment Office. Payments of principal of and
interest on this Note shall be made in such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts. Until the date on which all of the Senior
Notes shall have been surrendered or delivered to the Issuer or the Issuing and
Paying Agent for cancellation or destruction, or become due and payable and a
sum sufficient to pay the principal of and interest on all of the Senior Notes
shall have been either paid or reserved for payment by the Issuer as provided
herein, the Issuer shall at all times maintain an office or agency in the State
of New York where Senior Notes may be presented or surrendered for payment.

 

7

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

10. Registration of Transfer, Security Register. Except as otherwise provided
herein, this Note is transferable in whole and not in part, and may be exchanged
for a like aggregate principal amount of Senior Notes of other authorized
denominations, by the Noteholder in person, or by his attorney duly authorized
in writing, at the office of the Issuing and Paying Agent. The Issuing and
Paying Agent shall maintain a register providing for the registration of
ownership of the Senior Notes and any exchange or transfer thereof (the
“Security Register”). Upon presentation of this Note for exchange or
registration of transfer, the Issuer shall execute, authenticate and deliver in
exchange therefor a Note or Notes of like tenor and terms, each in a
denomination of $1,000 or any amount in excess thereof which is an integral
multiple of $1,000 and, in the absence of an opinion of counsel satisfactory to
the Issuer to the contrary, bearing the restrictive legends set forth on the
face of this Note and that is or are registered in such name or names requested
by the Noteholder. Any Note presented for registration of transfer or for
exchange shall be duly endorsed, or accompanied by a written instrument of
transfer in form satisfactory to the Issuer, and shall be accompanied by such
evidence of due authorization and guarantee of signature as may reasonably be
required by the Issuer in form satisfactory to the Issuer, duly executed by the
Noteholder or his attorney duly authorized in writing, with such tax
identification number or other information for each person in whose name a Note
is to be issued, and accompanied by evidence of compliance with any restrictive
legends appearing on such Note or Notes as the Issuer may reasonably request to
comply with applicable law. No exchange or registration of transfer of this Note
shall be made on or after the fifteenth day immediately preceding the Maturity
Date. This Note is subject to the restrictions on transfer of a subscription
agreement between the Issuer of this Note and the purchasers referred to
therein, a copy of which is on file with the Issuer. The Note may not be sold or
otherwise transferred except in compliance with said agreement.

11. Charges and Transfer Taxes. No service charge (other than any cost of
delivery) shall be imposed for any exchange or registration of transfer of this
Note, but the Issuing and Paying Agent or the Issuer may require payment of a
sum sufficient to cover any stamp or other tax or governmental charge payable in
connection therewith (other than exchanges pursuant to the Issuing and Paying
Agency Agreement not involving any transfer) or presentation of evidence that
such tax or charge has been paid.

12. Ownership. Prior to due presentment of this Note for registration of
transfer, the Issuer may deem and treat the Noteholder as the absolute owner of
this Note for the purpose of receiving payment of principal of and premium, if
any, and interest on this Note and for all other purposes whatsoever.

13. Notices. All notices to the Issuer under this Note shall be in writing and
addressed to the Issuer at Customers Bancorp, Inc., 1015 Penn Avenue, Suite 103,
Wyomissing, Pennsylvania 19610, Attention: Robert E. Wahlman, or to such other
address as the Issuer may provide by notice to the Noteholder. All notices to
the Noteholders shall be in writing and sent by first-class mail to each
Noteholder at his or its address as set forth in the Security Register. For so
long as the Notes are represented by Global Notes, any notices to Noteholders
will be delivered to DTC as the sole Noteholder in accordance with its
applicable policies as in effect from time to time.

14. Denominations. The Senior Notes are issuable only as registered Notes
without interest coupons in denominations of $1,000 or any amount in excess
thereof which is a whole multiple of $1,000.

 

8

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

15. Modification and Amendment.

(a) Without the consent of any Noteholders, the Issuer and the Issuing and
Paying Agent may enter into one or more modifications of the Issuing and Paying
Agency Agreement or the Senior Notes, in form reasonably satisfactory to the
Issuing and Paying Agent, to (i) evidence the succession of another entity to
the Issuer and the assumption by any such successor of the obligations of the
Issuer contained in the Issuing and Paying Agency Agreement and in the Senior
Notes, (ii) change or eliminate any of the provisions of the Issuing and Paying
Agency Agreement relating to the Senior Notes, provided that any such change or
elimination shall become effective only when there is no outstanding Senior Note
created prior to the execution of such amendment or modification which is
entitled to the benefit of such provisions, (iii) establish other forms or terms
of Senior Notes as permitted in the Issuing and Paying Agency Agreement,
(iv) evidence and provide for the acceptance of appointment under the Issuing
and Paying Agency Agreement by a successor Issuing and Paying Agent with respect
to the Senior Notes, (v) cure any ambiguity, correct or supplement any
provisions in the Issuing and Paying Agency Agreement relating to the Senior
Notes or in this Note which may be inconsistent with any other provisions herein
or in the Issuing and Paying Agency Agreement (as it relates to the Senior
Notes), or make any other provisions with respect to matters or questions
arising herein or in the Issuing and Paying Agency Agreement (as it relates to
the Senior Notes); provided that such action shall not adversely affect the
interests of any Noteholder in any material respect as determined in good faith
by the board of directors of the Issuer, (vi) modify the restrictions on and
procedures for resales and other transfers of the Senior Notes to reflect any
change in applicable law or regulation (or the interpretation thereof) or in
practices relating to the resale or other transfer of restricted securities
generally, or (vii) modify, eliminate or add to the provisions of the Issuing
and Paying Agency Agreement (as it relates to the Senior Notes) to such extent
as shall be necessary to qualify the Issuing and Paying Agency Agreement
(including any supplemental agreement thereto) under the Trust Indenture Act of
1939, as amended, or under such similar statute hereafter enacted.

(b) With the consent of the Noteholders of a majority in aggregate principal
amount of the outstanding Senior Notes affected thereby, the Issuer and the
Issuing and Paying Agent may enter into one or more agreements supplemental to
the Issuing and Paying Agency Agreement (as it relates to the Senior Notes) for
the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, the Issuing and Paying Agency Agreement
(as it relates to the Senior Notes) or of modifying in any manner the rights of
the Noteholders under the Issuing and Paying Agency Agreement; provided,
however, that no such supplemental agreement shall, without the consent of each
Noteholder affected thereby: (i) change the stated maturity date of the
principal (or any installment of principal) of any Note, (ii) change any
Interest Payment Date on which interest on any Note is to be paid, (iii) reduce
the principal amount of any Note, (iv) reduce the rate of interest on any Note,
(v) change the manner of calculation of interest on any Note, (vi) change any of
the redemption provisions of any Note, (vii) change any place of payment for any
Note, (viii) change the currency in which the principal of, or premium, if any,
or interest on, any Note is payable, (ix) impair the right to institute suit for
the enforcement of any required payment in respect of any Note on or after the
stated maturity thereof, or (x) reduce the percentage of the aggregate principal
amount of the outstanding Notes, the consent of whose Noteholders is required
for the modification and amendment of the Issuing and Paying Agency Agreement
(as it relates to the Senior Notes) and the Senior Notes.

 

9

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

16. Absolute and Unconditional Obligation of the Issuer. No provisions of this
Note shall alter or impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of and interest on this Note at the times,
places and rate, and in the coin or currency, herein prescribed.

17. Waiver and Consent. (a) Any consent or waiver given by the Noteholder shall
be conclusive and binding upon such Noteholder and upon all future holders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange therefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.

(b) No delay or omission of the Noteholder to exercise any right or remedy
accruing upon any Event of Default shall impair such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.

(c) Any insured depository institution which shall be a Noteholder or which
otherwise shall have any beneficial ownership interest in any Note shall, by its
acceptance of such Note (or beneficial interest therein), be deemed to have
waived any right of offset with respect to the indebtedness evidenced thereby.

18. Further Issues. The Issuer may, from time to time, without the consent of
any of the Noteholders, create and issue additional notes having the same terms
and conditions of the Senior Notes in all respects (except for the issue date,
issue price and initial Interest Payment Date) so that such additional notes
would form a single series with the Senior Notes and rank equally and ratably
with the Senior Notes or would form a new series. No additional Senior Notes may
be issued if any Event of Default has occurred and is continuing with respect to
the Senior Notes.

19. Governing Law. This Note shall be governed by and construed in accordance
with the laws of the State of New York.

20. Satisfaction and Discharge. The Issuing and Paying Agency Agreement (as it
relates to the Senior Notes) and this Note will cease to be of further effect
when:

(a) either (A) all Notes heretofore authenticated and delivered (other than
(i) Notes that have been destroyed, lost or stolen and that have been replaced
or paid as provided in the Issuing and Paying Agency Agreement and (ii) Notes
for whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Issuer and thereafter repaid to the Issuer or
discharged from such trust, as provided in the Issuing and Paying Agency
Agreement) have been delivered to the Issuer for cancellation; or (B) all Notes
not theretofore delivered to the Issuer for cancellation (i) have become due and
payable, or (ii) will become due and payable at their stated maturity within one
year, or (iii) are to be called for redemption within one year in accordance
with the terms of the Issuing and Paying Agency Agreement and the Notes and, in
the case of (B) (i), (ii) or (iii) above, the Issuer has irrevocably paid to the
Noteholders funds in an amount in the currency in which the Notes are payable,
sufficient to pay and discharge the

 

10

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

entire indebtedness on the Notes not theretofore delivered to the Issuer for
cancellation, for principal (and premium, if any) and interest with respect
thereto, to the date of such payment (in the case of Notes that have become due
and payable) or the stated maturity or redemption date, as the case may be;

(b) the Issuer has paid or caused to be paid all or other sums payable under the
Issuing and Paying Agency Agreement (as it relates to the Notes) and the Notes;
and

(c) the Issuer has delivered to each Noteholder an officer’s certificate stating
that all conditions precedent described above relating to the satisfaction and
discharge of the Issuing and Paying Agency Agreement (as it relates to the
Notes) and the Notes have been complied with.

[Signature Page Follows]

 

11

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

IN WITNESS WHEREOF, the undersigned has caused this Note to be duly executed and
attested.

 

CUSTOMERS BANCORP, INC. By:       Name:   Title:

 

ATTEST:   Name: Title:

Dated: June 26, 2014

[Note Signature Page]

 

12

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

CERTIFICATE OF AUTHENTICATION

This is one of the Notes referred

to in the within-mentioned Issuing

and Paying Agency Agreement

U.S. BANK NATIONAL ASSOCIATION

as Issuing and Paying Agent

By         Authorized Signature

 

13

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

Annex B-2

[Form of Bank Note]

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

SUBORDINATED NOTE CERTIFICATE

CUSTOMERS BANK

Fixed-to-Floating Rate Subordinated Notes Due 2029

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS NOT A DEPOSIT AND IS NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE “FDIC”) OR ANY OTHER
GOVERNMENT AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS SUBORDINATED AND JUNIOR
IN RIGHT OF PAYMENT TO THE OBLIGATIONS OF CUSTOMERS BANK (THE “BANK”) TO ITS
GENERAL AND SECURED CREDITORS (TO THE EXTENT OF SUCH SECURITY), TO DEPOSITS AND
LIABILITIES OF THE BANK (OTHER THAN EXISTING SUBORDINATED DEBT) AND IS UNSECURED
AND INELIGIBLE AS COLLATERAL FOR A LOAN BY THE BANK OR ANY OF ITS SUBSIDIARIES.

EACH SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM
DENOMINATIONS OF $1,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED
TRANSFER OF A SUBORDINATED NOTE IN A DENOMINATION OF LESS THAN $1,000 SHALL BE
DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER AND MAY BE DISREGARDED BY
THE BANK OR ANY OF ITS AGENTS. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT
TO BE THE HOLDER OF SUCH SUBORDINATED NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT
LIMITED TO, THE RECEIPT OF PAYMENTS ON SUCH SUBORDINATED NOTE, AND SUCH
PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH
SUBORDINATED NOTE.

THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REQUIREMENTS OF THE SECURITIES ACT. THIS
SUBORDINATED NOTE IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER
PROVISIONS OF A SUBSCRIPTION AGREEMENT, DATED JUNE 24, 2014, BY AND AMONG
CUSTOMERS BANCORP, INC. (THE “COMPANY”) AND THE BANK, AS ISSUERS, AND THE
PURCHASERS REFERRED TO THEREIN AND AN ISSUING AND PAYING AGENCY AGREEMENT, DATED
JUNE 26, 2014 (THE “ISSUING AND PAYING AGENCY AGREEMENT”), BY AND AMONG THE
COMPANY AND THE BANK, AS ISSUERS, AND U.S. BANK NATIONAL ASSOCIATION, AS ISSUING
AND PAYING AGENT, COPIES OF WHICH, IN EACH CASE, ARE ON FILE WITH THE ISSUER.
THIS SUBORDINATED NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID
AGREEMENTS. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENTS
WILL BE VOID.

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

THIS IS A GLOBAL NOTE WITHIN THE MEANING OF SECTION 2 OF THE ISSUING AND PAYING
AGENCY AGREEMENT.

UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATED
NOTE ISSUED IN EXCHANGE FOR THIS NOTE OR ANY PORTION HEREOF IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) PURSUANT TO AND
IN ACCORDANCE WITH THE ISSUING AND PAYING AGENCY AGREEMENT, ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON OTHER
THAN DTC OR A NOMINEE THEREOF IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

2

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

Registered No. 1                        Principal Amount:    $110,000,000   
                    CUSIP:    23204HBM9

CUSTOMERS BANK

Fixed-to-Floating Rate Subordinated Notes Due 2029

1. Payment.

(a) CUSTOMERS BANK, a company incorporated under the laws of the Commonwealth of
Pennsylvania (the “Issuer”), for value received, hereby promises to pay to
Cede & Co., or registered assigns, as nominee of DTC, the principal sum of One
Hundred Ten Million Dollars (U.S.) ($110,000,000) on June 26, 2029 (the
“Maturity Date”) and to pay interest thereon (i) at the rate of 6.125% per year
(computed on the basis of a 360-day year of twelve 30-day months) from and
including June 26, 2014 to but excluding June 26, 2024 or any early redemption
date (the “Fixed Rate Interest Period”), payable during the Fixed Rate Interest
Period semi-annually in arrears, on June 26 and December 26 of each year (each,
a “Fixed Interest Payment Date”), and (ii) at the rate per annum equal to the
three-month LIBOR rate plus 344.3 basis points (3.443%) (computed on the basis
of a 360-day year based on the number of days actually elapsed) from and
including June 26, 2024 to the Maturity Date or any early redemption date (the
“Floating Rate Interest Period”), payable quarterly in arrears on each
March 26, June 26, September 26 and December 26 (each, a “Floating Interest
Payment Date” and together with each Fixed Interest Payment Date, the “Interest
Payment Dates”). The first Interest Payment Date shall be December 26, 2014.

(b) If any Interest Payment Date or the Maturity Date is not a Business Day,
then the payment will be made on the next succeeding Business Day and no
interest will accrue as a result of such postponement. A “Business Day” means
any day other than a Saturday, Sunday, federal holiday or day on which banks in
the State of New York are authorized or obligated by law or executive order to
close.

(c) For purposes hereof:

(i) “Determination Date” with respect to an Interest Period will be the second
London Banking Day preceding the first day of such Interest Period.

(ii) “Interest Period” means the period commencing on and including an interest
payment date and ending on and including the day immediately preceding the next
succeeding Interest Payment Date.

(iii) “LIBOR” with respect to an Interest Period, will be the ICE Benchmark
Administration London Interbank Offered Rate (expressed as a percentage per
annum) for deposits in U.S. dollars for a three-month period beginning on the
second London Banking Day after the Determination Date that appears on the
appropriate page of the Reuters Screen as of 11:00 a.m., London time, on the
Determination Date. If such screen does not include such a rate or is
unavailable on a Determination Date, the Issuing and Paying Agent will request
the principal London office of each of four major banks in the London interbank
market, as selected

 

3

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

by the Issuing and Paying Agent, to provide such bank’s offered quotation
(expressed as a percentage per annum), as of approximately 11:00 a.m., London
time, on such Determination Date, to prime banks in the London interbank market
for deposits in a Representative Amount in U.S. dollars for a three-month period
beginning on the second London Banking Day after the Determination Date. If at
least two such offered quotations are so provided, the rate for the Interest
Period will be the arithmetic mean of such quotations. If fewer than two such
quotations are so provided, the Issuing and Paying Agent will request each of
three major banks in New York City, as selected by the Issuing and Paying Agent,
to provide such bank’s rate (expressed as a percentage per annum), as of
approximately 11:00 a.m., New York City time, on such Determination Date, for
loans in a Representative Amount in U.S. dollars to leading European banks for a
three-month period beginning on the second London Banking Day after the
Determination Date. If at least two such rates are so provided, the rate for the
Interest Period will be the arithmetic mean of such rates. If fewer than two
such rates are so provided, then the rate for the Interest Period will be the
rate in effect with respect to the immediately preceding Interest Period.

(iv) “London Banking Day” is any day on which dealings in U.S. dollars are
transacted or, with respect to any future date, are expected to be transacted in
the London interbank market.

(v) “Representative Amount” means a principal amount of not less than $1,000,000
for a single transaction in the relevant market at the relevant time.

2. Subordinated Notes, Noteholders. This Subordinated Note is a duly authorized
issue of notes of the Issuer designated as Fixed-to-Floating Rate Subordinated
Notes Due 2029 (herein called the “Subordinated Notes” or the “Notes”) issued
under the Issuing and Paying Agency Agreement, dated as of June 26, 2014 (the
“Issuing and Paying Agency Agreement”), among Customers Bancorp, Inc., the
Issuer and U.S. Bank National Association, as Issuing and Paying Agent (herein
called the “Issuing and Paying Agent,” which term includes any successor issuing
and paying agent under the Issuing and Paying Agency Agreement) and reference is
hereby made to the Issuing and Paying Agency Agreement for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Issuer and the Issuing and Paying Agent and of the terms upon which the
Subordinated Notes are, and are to be, authenticated and delivered. The holder
in whose name any Subordinated Notes are registered on the Security Register (as
defined herein) is referred to as a “Noteholder,” and such holders collectively
are referred to as the “Noteholders.”

3. Optional Redemption. The Issuer may, at its option, beginning with the
Interest Payment Date of June 26, 2024 and on any scheduled Interest Payment
Date thereafter (or at any time on or after the 30th day prior to the Maturity
Date), redeem the Subordinated Notes in whole or in part at a redemption price
equal to 100% of the principal amount of the redeemed Subordinated Notes, plus
accrued and unpaid interest to the date of the redemption. The option of
redemption is subject to the approval of the Federal Reserve Board (the “Federal
Reserve”).

The Issuer will notify Noteholders of the Subordinated Notes to be redeemed at
least 30 but not more than 60 days before the scheduled redemption (which notice
may be conditional). If the Issuer is redeeming less than all the Subordinated
Notes, the Issuing and Paying Agent under the Issuing and Paying Agency
Agreement must select the Subordinated Notes to be redeemed by lot or by such
other method as the Issuing and Paying Agent deems fair and appropriate, subject
to the rules and procedures of DTC.

 

4

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

Additionally, any time the Subordinated Notes remain outstanding, to the extent
the Issuer makes a reasonable determination (as evidenced by an officers’
certificate delivered to the Issuing and Paying Agent) that, as a result of the
occurrence of any amendment to, or change (including any announced prospective
change) in, the laws (or any rules or regulations thereunder) of the United
States or any political subdivision thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws, rules or regulations, which amendment or
change is effective or which pronouncement, action or decision is announced on
or after the date of issuance of the Subordinated Notes, it is reasonably likely
that the Subordinated Notes will not be entitled to treatment as “Tier 2”
capital (or the then equivalent thereof) for purposes of the capital adequacy
guidelines of the Federal Reserve, as then in effect and applicable, the Issuer
may, at its option, redeem the Subordinated Notes in whole or in part on not
fewer than 30 nor greater than 60 days’ prior notice mailed to the holders of
the Subordinated Notes, subject to the Federal Reserve’s approval, to the extent
required. In the event of any such redemption, the redemption price shall be
102% of the aggregate principal amount of the Subordinated Notes being redeemed
(plus accrued and unpaid interest through the early redemption date).

On and after any early redemption date, interest will cease to accrue on the
Subordinated Notes called for redemption. On or prior to any early redemption
date, the Issuer is required to deposit with the Issuing and Paying Agent money
sufficient to pay the redemption price of and accrued interest on the notes to
be redeemed on such date.

4. Subordination. The indebtedness of the Issuer evidenced by the Subordinated
Notes, including the principal and interest on this Note, shall be subordinate
and junior in right of payment to the prior payment in full of all existing and
future Senior Indebtedness (as defined below) of the Issuer, and that such
subordination is for the benefit of and enforceable by the holders of such
Senior Indebtedness. Upon any payment or distribution of assets to creditors in
case of the Issuer’s liquidation, dissolution, winding up, reorganization,
assignment for the benefit of creditors or any bankruptcy, insolvency, or
similar proceedings, all holders of Senior Indebtedness will be entitled to
receive payment in full of all amounts due to such holders pursuant to the terms
of such Senior Indebtedness before the Noteholders will be entitled to receive
any payment of principal or interest on their Subordinated Notes. In the event
of any such proceeding, after payment in full of all sums owing with respect to
Senior Indebtedness, the Noteholders, together with the holders of any
obligations of the Issuer ranking equally in right of payment with the
Subordinated Notes, shall be entitled to be paid from the remaining assets of
the Issuer, the unpaid principal thereof, and the unpaid interest thereon,
before any payment or other distribution, whether in cash, property or
otherwise, shall be made on account of any capital stock or any obligations of
the Issuer ranking subordinate or junior to the Subordinated Notes. In addition,
no payment on account of principal or interest on the Subordinated Notes will be
made by the Issuer if, at the time of such payment or immediately after giving
effect thereto, there shall have occurred an event of default with respect to
any of the Issuer’s Senior Indebtedness, permitting the holders thereof (or a
trustee on behalf of the holders thereof) to accelerate the maturity thereof, or
an event that, with the giving of notice or the passage of time or both, would
constitute such event of default, and such event of default shall not have been
cured or waived.

 

5

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

“Senior Indebtedness” means the principal of (and premium, if any) and interest,
if any, on:

(a) the Issuer’s obligations for money borrowed (including deposits);

(b) indebtedness of the Issuer evidenced by bonds, debentures, notes or similar
instruments;

(c) similar obligations of the Issuer arising from off-balance sheet guarantees
and direct credit substitutes;

(d) reimbursement obligations of the Issuer with respect to letters of credit,
bankers’ acceptances or similar facilities;

(e) obligations of the Issuer issued or assumed as the deferred purchase price
of property or services (but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business);

(f) capital lease obligations of the Issuer;

(g) obligations of the Issuer associated with derivative products including but
not limited to securities contracts, foreign currency exchange contracts, swap
agreements (including interest rate and foreign exchange rate swap agreements),
cap agreements, floor agreements, collar agreements, interest rate agreements,
foreign exchange rate agreements, options, commodity futures contracts,
commodity option contracts and similar financial instruments;

(h) a deferred obligation of, or any such obligation, directly or indirectly
guaranteed by, the Issuer which obligation is incurred in connection with the
acquisition of any business, properties or assets not evidenced by a note or
similar instrument given in connection therewith; and

(i) debt of others described in the preceding clauses that the Issuer has
guaranteed or for which the Issuer is otherwise liable, unless, in any case in
the instrument creating or evidencing any such indebtedness or obligation, or
pursuant to which the same is outstanding, it is provided that such indebtedness
or obligation is not superior in right of payment to the Subordinated Notes or
to other debt that is pari passu with or subordinate to the Subordinated Notes.

Each Noteholder by accepting a Note authorizes and directs the Issuing and
Paying Agent on its behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination between the
Noteholders and the holders of Senior Indebtedness of the Issuer as provided in
this Section 4 and appoints the Issuing and Paying Agent as attorney-in-fact for
any and all such purposes.

Nothing herein shall impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of and interest on this Note in accordance
with its terms.

 

6

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

Each Noteholder by accepting a Note acknowledges and agrees that the foregoing
subordination provisions are, and are intended to be, an inducement and a
consideration to each holder of any Senior Indebtedness of the Issuer, whether
such Senior Indebtedness was created or acquired before or after the issuance of
the Notes, to acquire and continue to hold, or to continue to hold, such Senior
Indebtedness and such holder of such Senior Indebtedness shall be deemed
conclusively to have relied on such subordination provisions in acquiring and
continuing to hold, or in continuing to hold, such Senior Indebtedness.

Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness of the Issuer may, at any time and from time to
time, without the consent of or notice to the Issuing and Paying Agent or the
Noteholders, without incurring responsibility to the Issuing and Paying Agent or
the Noteholders and without impairing or releasing the subordination provided in
this Section 4 or the obligations hereunder of the Noteholders to the holders of
the Senior Indebtedness of the Issuer, do any one or more of the following:
(i) change the manner, place or terms of payment or extend the time of payment
of, or renew or alter, Senior Indebtedness of the Issuer, or otherwise amend or
supplement in any manner Senior Indebtedness of the Issuer, or any instrument
evidencing the same or any agreement under which Senior Indebtedness of the
Issuer is outstanding; (ii) sell, exchange, release or otherwise deal with any
property pledged, mortgaged or otherwise securing Senior Indebtedness of the
Issuer; (iii) release any Person liable in any manner for the payment or
collection of Senior Indebtedness of the Issuer; and (iv) exercise or refrain
from exercising any rights against the Issuer and any other Person.

5. Consolidation, Merger and Sale of Assets. The Issuer shall not consolidate
with or merge into another person or entity, or convey or transfer its
properties and assets substantially as an entirety to any person or entity,
unless:

(a) the person or entity formed by such consolidation or into which the Issuer
is merged or the person or entity which acquires by conveyance or transfer the
properties and assets of the Issuer substantially as an entirety is a
corporation, partnership, limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or any other entity
organized and existing under the laws of the United States of America, any State
thereof or the District of Columbia and expressly assumes, by a supplemental
agreement, the due and punctual payment of the principal of and any interest on
the Subordinated Notes according to their terms, and the due and punctual
performance and observance of all covenants and conditions to be performed by
the Issuer contained in this Note and the Issuing and Paying Agency Agreement;
and

(b) immediately after giving effect to such transaction, no Event of Default,
and no event which, after notice or lapse of time or both, would become an Event
of Default, shall have occurred and be continuing.

Upon any such consolidation or merger, or conveyance or transfer, the successor
entity or person formed, or into which the Issuer is merged or to which such
conveyance or transfer is made, shall succeed to, and be substituted for, the
Issuer under the Issuing and Paying Agency Agreement, and the Issuer shall be
released from all of its obligations pursuant thereto.

 

7

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

6. Events of Default; Acceleration. If any of the following events shall occur
and be continuing (each an “Event of Default”):

(a) the Issuer shall consent to the appointment of a receiver, liquidator,
trustee or other similar official in any bankruptcy, liquidation, insolvency or
similar proceeding with respect to the Issuer; or

(b) a court or other governmental agency or body having jurisdiction shall enter
a decree or order for the appointment of a receiver, liquidator, trustee or
other similar official in any bankruptcy, receivership, liquidation, insolvency
or similar proceeding with respect to the Issuer and such decree or order shall
have remained in force for 30 days;

then, and in each such case, unless the principal of this Note already shall
have become due and payable, the holders of 100% of the outstanding principal
amount of the Subordinated Notes, by notice in writing to the Issuer, may
declare the principal amount of this Note to be due and payable immediately, and
upon any such declaration the same shall become and shall be immediately due and
payable.

7. Failure to Make Payment. In the event of failure by the Issuer to make any
required payment of principal or interest on this Note (and, in the case of
payment of interest, such failure to pay shall have continued for 30 calendar
days), the Noteholders may (if such principal or interest remains unpaid
following delivery by such Noteholders of notice to the Issuer) institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Issuer and collect the amounts adjudged or decreed to be payable in
the manner provided by law.

8. Payment Procedures. Payment of the principal and interest payable on the
Maturity Date will be made by wire transfer in immediately available funds to a
bank account in the United States designated by the Noteholder, upon
presentation and surrender of this Note at the office of the Issuer or at such
other place or places as the Issuer shall designate by notice to the
Noteholders, provided that this Note is presented to the Issuer in time for the
Issuer to make such payments in such funds in accordance with its normal
procedures. Payments of interest (other than interest payable on the Maturity
Date or upon early redemption) shall be made by wire transfer in immediately
available funds or check mailed to the person entitled thereto, as such person’s
address appears on the Security Register maintained by the Issuing and Paying
Agent as of the applicable Regular Record Date or to such other address in the
United States as any Noteholder shall designate to the Issuing and Paying Agent
in writing not later than the relevant Regular Record Date. Interest payable on
any Interest Payment Date shall be payable to the holder in whose name this Note
is registered at the close of business on the fifteenth calendar day (whether or
not a Business Day) immediately preceding the applicable Interest Payment Date
(such date being referred to herein as the “Regular Record Date”), except that
interest not punctually paid may be paid to the Noteholder in whose name this
Note is registered at the close of business on a Special Record Date fixed by
the Issuer (a “Special Record Date”), notice of which shall be given to the
holder not less than 15 calendar days prior to such Special Record Date. (The
Regular Record Date and Special Record Date are referred to herein collectively
as the “Record Dates”). To the extent permitted by applicable law, interest
shall accrue, at the rate at which interest accrues on the principal of this
Note, on any amount of principal of or interest on this Note not paid when due.
All payments on this Note shall be applied first to accrued interest and then
the balance, if any, to principal.

 

8

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

9. Form of Payment, Maintenance of Payment Office. Payments of principal of and
interest on this Note shall be made in such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts. Until the date on which all of the
Subordinated Notes shall have been surrendered or delivered to the Issuer or the
Issuing and Paying Agent for cancellation or destruction, or become due and
payable and a sum sufficient to pay the principal of and interest on all of the
Subordinated Notes shall have been either paid or reserved for payment by the
Issuer as provided herein, the Issuer shall at all times maintain an office or
agency in the State of New York where Subordinated Notes may be presented or
surrendered for payment.

10. Registration of Transfer, Security Register. Except as otherwise provided
herein, this Note is transferable in whole and not in part, and may be exchanged
for a like aggregate principal amount of Subordinated Notes of other authorized
denominations, by the Noteholder in person, or by his attorney duly authorized
in writing, at the office of the Issuing and Paying Agent. The Issuing and
Paying Agent shall maintain a register providing for the registration of
ownership of the Subordinated Notes and any exchange or transfer thereof (the
“Security Register”). Upon presentation of this Note for exchange or
registration of transfer, the Issuer shall execute, authenticate and deliver in
exchange therefor a Note or Notes of like tenor and terms, each in a
denomination of $1,000 or any amount in excess thereof which is an integral
multiple of $1,000 and, in the absence of an opinion of counsel satisfactory to
the Issuer to the contrary, bearing the restrictive legends set forth on the
face of this Note and that is or are registered in such name or names requested
by the Noteholder. Any Note presented for registration of transfer or for
exchange shall be duly endorsed, or accompanied by a written instrument of
transfer in form satisfactory to the Issuer, and shall be accompanied by such
evidence of due authorization and guarantee of signature as may reasonably be
required by the Issuer in form satisfactory to the Issuer, duly executed by the
Noteholder or his attorney duly authorized in writing, with such tax
identification number or other information for each person in whose name a Note
is to be issued, and accompanied by evidence of compliance with any restrictive
legends appearing on such Note or Notes as the Issuer may reasonably request to
comply with applicable law. No exchange or registration of transfer of this Note
shall be made on or after the fifteenth day immediately preceding the Maturity
Date. This Note is subject to the restrictions on transfer of a subscription
agreement between the Issuer of this Note and the purchasers referred to
therein, a copy of which is on file with the Issuer. The Note may not be sold or
otherwise transferred except in compliance with said agreement.

11. Charges and Transfer Taxes. No service charge (other than any cost of
delivery) shall be imposed for any exchange or registration of transfer of this
Note, but the Issuing and Paying Agent or the Issuer may require payment of a
sum sufficient to cover any stamp or other tax or governmental charge payable in
connection therewith (other than exchanges pursuant to the Issuing and Paying
Agency Agreement not involving any transfer) or presentation of evidence that
such tax or charge has been paid.

12. Ownership. Prior to due presentment of this Note for registration of
transfer, the Issuer may deem and treat the Noteholder as the absolute owner of
this Note for the purpose of receiving payment of principal of and premium, if
any, and interest on this Note and for all other purposes whatsoever.

 

9

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

13. Notices. All notices to the Issuer under this Note shall be in writing and
addressed to the Issuer at Customers Bank, 1015 Penn Avenue, Suite 103,
Wyomissing, Pennsylvania 19610, Attention: Robert E. Wahlman, or to such other
address as the Issuer may provide by notice to the Noteholder. All notices to
the Noteholders shall be in writing and sent by first-class mail to each
Noteholder at his or its address as set forth in the Security Register. For so
long as the Notes are represented by Global Notes, any notices to Noteholders
will be delivered to DTC as the sole Noteholder in accordance with its
applicable policies as in effect from time to time.

14. Denominations. The Subordinated Notes are issuable only as registered Notes
without interest coupons in denominations of $1,000 or any amount in excess
thereof which is a whole multiple of $1,000.

15. Modification and Amendment.

(a) Without the consent of any Noteholders, the Issuer and the Issuing and
Paying Agent may enter into one or more modifications of the Issuing and Paying
Agency Agreement or the Subordinated Notes, in form reasonably satisfactory to
the Issuing and Paying Agent, to (i) evidence the succession of another entity
to the Issuer and the assumption by any such successor of the obligations of the
Issuer contained in the Issuing and Paying Agency Agreement and in the
Subordinated Notes, (ii) change or eliminate any of the provisions of the
Issuing and Paying Agency Agreement relating to the Subordinated Notes, provided
that any such change or elimination shall become effective only when there is no
outstanding Subordinated Note created prior to the execution of such amendment
or modification which is entitled to the benefit of such provisions,
(iii) establish other forms or terms of Subordinated Notes as permitted in the
Issuing and Paying Agency Agreement, (iv) evidence and provide for the
acceptance of appointment under the Issuing and Paying Agency Agreement by a
successor Issuing and Paying Agent with respect to the Subordinated Notes,
(v) cure any ambiguity, correct or supplement any provisions in the Issuing and
Paying Agency Agreement or in this Note which may be inconsistent with any other
provisions herein or in the Issuing and Paying Agency Agreement (as it relates
to the Subordinated Notes), or make any other provisions with respect to matters
or questions arising herein or in the Issuing and Paying Agency Agreement (as it
relates to the Subordinated Notes); provided that such action shall not
adversely affect the interests of any Noteholder in any material respect as
determined in good faith by the board of directors of the Issuer, (vi) modify
the restrictions on and procedures for resales and other transfers of the
Subordinated Notes to reflect any change in applicable law or regulation (or the
interpretation thereof) or in practices relating to the resale or other transfer
of restricted securities generally, or (vii) modify, eliminate or add to the
provisions of the Issuing and Paying Agency Agreement (as it relates to the
Subordinated Notes) to such extent as shall be necessary to qualify the Issuing
and Paying Agency Agreement (including any supplemental agreement thereto) under
the Trust Indenture Act of 1939, as amended, or under such similar statute
hereafter enacted.

 

10

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

(b) With the consent of the Noteholders of a majority in aggregate principal
amount of the outstanding Subordinated Notes affected thereby, the Issuer and
the Issuing and Paying Agent may enter into one or more agreements supplemental
to the Issuing and Paying Agency Agreement (as it relates to the Subordinated
Notes) for the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, the Issuing and Paying Agency Agreement
(as it relates to the Subordinated Notes) or of modifying in any manner the
rights of the Noteholders under the Issuing and Paying Agency Agreement;
provided, however, that no such supplemental agreement shall, without the
consent of each Noteholder affected thereby: (i) change the stated maturity date
of the principal (or any installment of principal) of any Note, (ii) change any
Interest Payment Date on which interest on any Note is to be paid, (iii) reduce
the principal amount of any Note, (iv) reduce the rate of interest on any Note,
(v) change the manner of calculation of interest on any Note, (vi) change any of
the redemption provisions of any Note, (vii) change any place of payment for any
Note, (viii) change the currency in which the principal of, or premium, if any,
or interest on, any Note is payable, (ix) impair the right to institute suit for
the enforcement of any required payment in respect of any Note on or after the
stated maturity thereof, or (x) reduce the percentage of the aggregate principal
amount of the outstanding Notes, the consent of whose Noteholders is required
for the modification and amendment of the Issuing and Paying Agency Agreement
(as it relates to the Subordinated Notes) and the Subordinated Notes.

16. Absolute and Unconditional Obligation of the Issuer. No provisions of this
Note shall alter or impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of and interest on this Note at the times,
places and rate, and in the coin or currency, herein prescribed.

17. Waiver and Consent. (a) Any consent or waiver given by the Noteholder shall
be conclusive and binding upon such Noteholder and upon all future holders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange therefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.

(b) No delay or omission of the Noteholder to exercise any right or remedy
accruing upon any Event of Default shall impair such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.

(c) Any insured depository institution which shall be a Noteholder or which
otherwise shall have any beneficial ownership interest in any Note shall, by its
acceptance of such Note (or beneficial interest therein), be deemed to have
waived any right of offset with respect to the indebtedness evidenced thereby.

18. Further Issues. The Issuer may, from time to time, without the consent of
any of the Noteholders, create and issue additional notes having the same terms
and conditions of the Subordinated Notes in all respects (except for the issue
date, issue price and initial Interest Payment Date) so that such additional
notes would form a single series with the Subordinated Notes and rank equally
and ratably with the Subordinated Notes or would form a new series. No
additional Subordinated Notes may be issued if any Event of Default has occurred
and is continuing with respect to the Subordinated Notes.

19. Governing Law. This Note shall be governed by and construed in accordance
with the laws of the State of New York.

 

11

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

20. Satisfaction and Discharge. The Issuing and Paying Agency Agreement and this
Note will cease to be of further effect when:

(a) either (A) all Notes heretofore authenticated and delivered (other than
(i) Notes that have been destroyed, lost or stolen and that have been replaced
or paid as provided in the Issuing and Paying Agency Agreement and (ii) Notes
for whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Issuer and thereafter repaid to the Issuer or
discharged from such trust, as provided in the Issuing and Paying Agency
Agreement) have been delivered to the Issuer for cancellation; or (B) all Notes
not theretofore delivered to the Issuer for cancellation (i) have become due and
payable, or (ii) will become due and payable at their stated maturity within one
year, or (iii) are to be called for redemption within one year in accordance
with the terms of the Issuing and Paying Agency Agreement and the Notes and, in
the case of (B) (i), (ii) or (iii) above, the Issuer has irrevocably paid to the
Noteholders funds in an amount in the currency in which the Notes are payable,
sufficient to pay and discharge the entire indebtedness on the Notes not
theretofore delivered to the Issuer for cancellation, for principal (and
premium, if any) and interest with respect thereto, to the date of such payment
(in the case of Notes that have become due and payable) or the stated maturity
or redemption date, as the case may be;

(b) the Issuer has paid or caused to be paid all or other sums payable under the
Issuing and Paying Agency Agreement and the Notes; and

(c) the Issuer has delivered to each Noteholder an officer’s certificate stating
that all conditions precedent described above relating to the satisfaction and
discharge of the Issuing and Paying Agency Agreement and the Notes have been
complied with.

[Signature Page Follows]

 

12

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

IN WITNESS WHEREOF, the undersigned has caused this Note to be duly executed and
attested.

 

CUSTOMERS BANK By:       Name:   Title:

 

ATTEST:   Name: Title:

Dated: June 26, 2014

[Note Signature Page]

 

13

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

CERTIFICATE OF AUTHENTICATION

This is one of the Notes referred

to in the within-mentioned Issuing

and Paying Agency Agreement

U.S. BANK NATIONAL ASSOCIATION

as Issuing and Paying Agent

By       Authorized Signature

 

14