SUBORDINATED
NOTE PURCHASE AGREEMENT
Dated as of January 30, 2015

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SUBORDINATED NOTE PURCHASE AGREEMENT
This SUBORDINATED NOTE PURCHASE AGREEMENT (this “Agreement”) is dated as of
January 30, 2015 and is made by and between ENTERPRISE BANCORP, INC.
(“Borrower”) and (the “Lender”).
R E C I T A L S:
Borrower is a Massachusetts corporation and the parent of its wholly-owned
subsidiary, Enterprise Bank and Trust Company, a Massachusetts banking
corporation (“Bank”).
Borrower has requested that Lender provide to Borrower $15,000,000.00 in
subordinated debt (the “Subordinated Debt”) that qualifies as Tier 2 Capital (as
defined herein), as evidenced by the Subordinated Note (as defined herein). The
Subordinated Debt may be referred to in this Agreement as the “Facility.”
Lender is willing to provide to Borrower a subordinated note in the principal
amount of $15,000,000.00 in accordance with the terms, subject to the recitals,
and subject to the conditions and in reliance on the representations,
warranties, covenants and agreements set forth herein and in the Subordinated
Note (as defined herein). The Subordinated Debt is intended to qualify as Tier 2
Capital.
THEREFORE, in consideration of the mutual covenants, conditions and agreements
herein contained, the parties hereto hereby agree as follows:
A G R E E M E N T:
1.DEFINITIONS.
1.1.    Defined Terms. The following capitalized terms generally used in this
Agreement and in the other Transaction Document have the meanings defined or
referenced below. Certain other capitalized terms used only in specific sections
of this Agreement may be defined in such sections.
“2013 Financial Statements” has the meaning set forth in Section 4.4.1.
“2014 Financial Statements” has the meaning set forth in Section 4.4.1.
“Adjusted Interest Rate” means that fluctuating rate of interest per annum equal
to three point nine percent (3.90%) above the LIBOR 30 Day Index Rate, with
changes to such interest rate taking place immediately without notice or demand
of any kind by the Lender on the effective date of any change in the LIBOR 30
Day Index.
“Affiliate(s)” means, with respect to any Person, such Person’s immediate family
members, partners, members or parent and subsidiary corporations, and any other
Person directly or indirectly controlling, controlled by, or under common
control with, said Person and their respective Affiliates,

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and in the case of Lender, Borrower and Bank, their respective members,
shareholders, directors, officers, employees, agents, advisors and
representatives.
“Bank” has the meaning set forth in the recitals hereto.
“Board Resolution” means a copy of a resolution certified by the Secretary or an
Assistant Secretary of the Borrower to (i) have been duly adopted by the Board
of Directors and (ii) be in full force and effect on the date of such
certification.
“Borrower” has the meaning set forth in the preamble hereto and shall include
any successor to Borrower by acquisition, merger, consolidation or similar
transaction.
“Borrower’s Accountant” means such firm of certified public accountants selected
by Borrower as shall from time to time audit Borrower.
“Borrower’s Liabilities” means Borrower’s obligations under this Agreement and
the Subordinated Note.
“Business Day” means any day other than a Saturday, Sunday or any other day on
which banking institutions in Massachusetts are permitted or required by any
applicable law or executive order to close.
“Closing” has the meaning set forth in Section 2.5.
“Closing Date” means January 30, 2015.
“Code” means the Internal Revenue Code of 1986, as amended or recodified.
“Commitment Fee” means a fee in the amount of $150,000.00 to be paid by Borrower
to Lender pursuant to the provisions of Section 2.13.
“Condition or Release” means any presence, use, storage, transportation,
discharge, disposal, release or threatened release of any Hazardous Materials
that individually or in the aggregate would constitute a Material Adverse
Effect.
“Disbursement” has the meaning set forth in Section 3.1.
“Equity Interest” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person which is not a corporation and any
and all warrants, options or other rights to purchase any of the foregoing.
“Event of Default” has the meaning set forth in Section 8.1.1.
“Facility” has the meaning set forth in the recitals hereto.
“FDIC” means the Federal Deposit Insurance Corporation.

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“FRB” means, collectively, the Board of Governors of the Federal Reserve System
and the Federal Reserve Bank of Boston.
“GAAP” means generally accepted accounting principles in effect from time to
time in the United States of America.
“Governmental Agency(ies)” means, individually or collectively, any federal,
state, county or local governmental department, commission, board, regulatory
authority or agency with jurisdiction over Borrower or Bank, as applicable.
“Governmental Licenses” has the meaning set forth in Section 4.3.
“Hazardous Materials” means oil, flammable explosives, asbestos, urea
formaldehyde insulation, polychlorinated biphenyls, radioactive materials,
hazardous wastes, toxic or contaminated substances or similar materials,
including, without limitation, any substances which are “hazardous substances,”
“hazardous wastes,” “hazardous materials” or “toxic substances” under the
Hazardous Materials Laws and/or other applicable environmental laws, ordinances
or regulations.
“Hazardous Materials Laws” mean any laws, regulations, permits, licenses or
requirements pertaining to the protection, preservation, conservation or
regulation of the environment which relates to real property, including, without
limitation: the Clean Air Act, as amended, 42 U.S.C. Section 7401 et seq.; the
Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq.;
the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C.
Section 6901 et seq.; the Comprehensive Environment Response, Compensation and
Liability Act of 1980, as amended (including the Superfund Amendments and
Reauthorization Act of 1986), 42 U.S.C. Section 9601 et seq.; the Toxic
Substances Control Act, as amended, 15 U.S.C. Section 2601 et seq.; the
Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651, the
Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. Section
11001 et seq.; the Mine Safety and Health Act of 1977, as amended, 30 U.S.C.
Section 801 et seq.; the Safe Drinking Water Act, 42 U.S.C. Section 300f et
seq.; and all comparable state and local laws, laws of other jurisdictions or
orders and regulations.
“Indebtedness” means and includes: (a) all items arising from the borrowing of
money that, according to GAAP as in effect from time to time, would be included
in determining total liabilities as shown on the consolidated balance sheet of
Borrower, Bank or any other Subsidiary of Borrower; and (b) all obligations
secured by any lien in property owned by Borrower whether or not such
obligations shall have been assumed, provided, however, Indebtedness shall not
include deposits or other indebtedness created, incurred or maintained in the
ordinary course of Bank’s business (including, without limitation, federal funds
purchased, advances from any Federal Home Loan Bank, secured deposits of
municipalities, letters of credit issued by Bank’s depository institution and
repurchase arrangements) and consistent with customary banking practices and
applicable laws and regulations.
“Initial Interest Rate” means a 6.00% per annum rate of interest.

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“Interest Payment Date” means March 1, 2015 and the first day of each month
thereafter continuing until the earlier of the Maturity Date or the date the
Subordinated Debt is paid in full.
“Knowledge” means the best knowledge of the party being referenced based on
commercially reasonable inquiry.
“Leases” means all leases, licenses or other documents providing for the use or
occupancy of any portion of any Property, including all amendments, extensions,
renewals, supplements, modifications, sublets and assignments thereof and all
separate letters or separate agreements relating thereto.
“Lender” has the meaning set forth in the preamble hereto.
“LIBOR 30 Day Index Rate” shall mean that variable rate per annum determined on
the basis of ICE Benchmark Administration (or any other Person that takes over
the administration of such rate for U.S. Dollars) or a comparable or successor
rate for deposits in U.S. Dollars with a one month term in the London Interbank
market for a period equal to such interest rate period commencing on the first
day of such interest rate period as displayed on pages LIBOR01 or LIBOR02 of
Reuters (or another commercially available service providing quotations of LIBOR
as designated by Lender generally under credit facilities for which its acts as
Lender). If such rate is not available at such time for any reason, then the
rate for that interest period will be determined by such alternate method as
reasonably selected by Lender.
“Material Adverse Effect” means, with respect to any Person, any change or
effect that (i) is or would be reasonably likely to be material and adverse to
the financial position, results of operations or business of such Person or its
Subsidiaries, or (ii) would materially impair the ability of any Person to
perform its respective obligations under this Agreement or the Subordinated
Note, or otherwise materially impede the consummation of the transactions
contemplated hereby; provided, however, that “Material Adverse Effect” shall not
be deemed to include the impact of (1) changes in banking and similar laws,
rules or regulations of general applicability or interpretations thereof by
Governmental Agencies, (2) changes in GAAP or regulatory accounting requirements
applicable to financial institutions and their holding companies generally, (3)
changes after the date of this Agreement in general economic or capital market
conditions affecting financial institutions or their market prices generally and
not specifically related to Borrower, Bank or Lender, including, but not limited
to, changes in levels of interest rates generally or any outbreak of war or
major hostilities in which the United States is involved or any act of terrorism
or civil insurrection within the United States, (4) direct effects of compliance
with this Agreement on the operating performance of Borrower, Bank or Lender,
including expenses incurred by Borrower, Bank or Lender in consummating the
transactions contemplated by this Agreement, and (5) the effects of any action
or omission taken by Borrower with the prior written consent of Lender, and vice
versa, or as otherwise contemplated by this Agreement and the Subordinated Note.
“Maturity Date” means January 30, 2030.
“Person” means an individual, a corporation (whether or not for profit), a
partnership, a limited liability company, a joint venture, an association, a
trust, an unincorporated organization, a

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government or any department or agency thereof (including a Governmental Agency)
or any other entity or organization.
“Property” means any real property owned or leased by Borrower, Bank or any
Affiliate or Subsidiary of Borrower or Bank.
“Subordinated Debt” has the meaning set forth in the recitals hereto.
“Subordinated Note” means the Subordinated Note in the form attached as Exhibit
A hereto, as amended, restated, supplemented or modified from time to time and
each Subordinated Note delivered in substitution or exchange for such
Subordinated Note.
“Subsidiary” means with respect to any Person, any corporation or entity in
which a majority of the outstanding Equity Interest is directly or indirectly
owned by such Person.
“Tier 2 Capital” has the meaning given to the term “tier 2 capital” in the
Statement of Policy on Risk-Based Capital for bank holding companies published
by the FRB (12 C.F.R. Part 225, Appendix A, as amended, modified and
supplemented and in effect from time to time or any replacement thereof),
including 12 C.F.R. § 250.166.
“Transaction Documents” means this Agreement and the Subordinated Note.
“Unmatured Event of Default” means an event or circumstance that with the
passage of time, the giving of notice or both could become an Event of Default.
1.2.        Certain Accounting Terms; Interpretations. Notwithstanding the
foregoing, any accounting terms used in this Agreement which are not
specifically defined herein shall have the meaning customarily given to them in
accordance with GAAP. Where the character or amount of any asset or liability or
item of income or expense is required to be determined or any consolidation or
other accounting computation is required to be made for the purposes of this
Agreement, it shall be done in accordance with GAAP except where such principles
are inconsistent with the specific provisions of this Agreement or the rules of
any Government Agency. The foregoing definitions are equally applicable to both
the singular and plural forms of the terms defined. The words “hereof”, “herein”
and “hereunder” and words of like import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement. The word “including” when used in this Agreement without the phrase
“without limitation,” shall mean “including, without limitation.” All references
to time of day herein are references to eastern time unless otherwise
specifically provided. Any reference contained herein to attorneys’ fees and
expenses shall be deemed to be reasonable fees and expenses of Lender’s outside
counsel and of any other third-party experts or consultants engaged by Lender’s
outside counsel on Lender’s behalf. All references to the Transaction Documents
shall be deemed to be to such documents as amended, modified or restated from
time to time. With respect to any reference in this Agreement to any defined
term, (a) if such defined term refers to a Person, then it shall also mean all
heirs, legal representatives and permitted successors and assigns of such
Person, and (b) if such defined term refers to a document, instrument or
agreement, then it shall also include any replacement, extension or other
modification thereof.

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2.SUBORDINATED DEBT.
2.1.    General Matters.
2.1.1.    Certain Terms. The Lender agrees to provide the Subordinated Debt from
Borrower on the Closing Date in accordance with the terms of, and subject to the
conditions set forth in, this Agreement and the Subordinated Note. The
Subordinated Debt shall be disbursed in accordance with Section 3.1. The
Subordinated Debt shall bear interest per annum at the rate and in the manner
set forth in Section 2.6 and Section 2.7 hereof. The unpaid principal balance of
the Subordinated Debt plus all accrued but unpaid interest thereon shall be due
and payable on the Maturity Date, or such earlier date on which such amount
shall become due and payable on account of acceleration by Lender in accordance
with the terms of the Subordinated Note or this Agreement.
2.1.2.    Subordination. The Subordinated Note shall be subordinated in
accordance with the subordination provisions set forth therein and as otherwise
required in order that the Subordinated Debt shall constitute Tier 2 Capital. In
the event of any conflict between the Transaction Documents, on one hand, and
any statute, regulation, policy or pronouncement of or applicable to the FRB
concerning or related to Tier 2 Capital, on the other hand, such FRB statute,
regulation, policy or pronouncement shall control. If all or any portion of the
Note ceases to be deemed to be Tier 2 Capital under the risk-based capital rules
of the FRB as in effect as of the date of this Purchase Agreement, other than
due to the limitation imposed on the capital treatment of subordinated debt
during the five years immediately preceding the Maturity Date of the Note,
Borrower will immediately notify Lender, and thereafter Borrower and Lender will
work together in good faith to develop such modifications to the applicable
portions of the obligations evidenced by the Note as are reasonably acceptable
to Lender in order for the Note to continue to qualify as Tier 2 Capital.
2.2.    The Subordinated Note. The Facility shall be further evidenced by the
Subordinated Note, to be executed and delivered to Lender by Borrower
contemporaneously herewith.
2.3.    Maturity Date. On the Maturity Date, all sums due and owing under this
Agreement and the other Transaction Document with respect to the Subordinated
Note shall be repaid in full. Borrower acknowledges and agrees that Lender has
not made any commitments, either express or implied, to extend the terms of the
Facility past its Maturity Date, and shall not extend such terms beyond the
Maturity Date unless Borrower and Lender hereafter specifically otherwise agree
in writing.
2.4.    Unsecured Facility. The obligations of Borrower to Lender under the
Subordinated Note shall be unsecured.
2.5.    The Closing. The execution and delivery of the Transaction Documents
(the “Closing”) shall occur at the offices of at 10:00 a.m. (local time) on the
Closing Date, or at such other place or time or on such other date as the
parties hereto may agree.

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2.6.    Interest Payments. From the date hereof through January 30, 2025, the
outstanding principal balance of and any overdue principal and interest on the
Facility shall bear interest per annum at the Initial Interest Rate of 6.00% per
annum and beginning on January 31, 2025 through the Maturity Date, the
outstanding principal balance of any overdue principal and interest shall bear
interest at the Adjusted Interest Rate. Interest shall be payable in arrears on
each Interest Payment Date at the rates and under the circumstances set forth
herein. The initial Interest Payment Date shall be on March 1, 2015.
2.7.    Computation of Interest. Interest shall be computed on the basis of the
actual number of days elapsed in the period during which interest accrues and a
year of 360 days. In computing interest, the date of funding shall be included
and the date of payment (with respect to the amount timely paid on such date)
shall be excluded. The parties hereto intend to conform strictly to applicable
usury laws as in effect from time to time during the term of the Facility.
Accordingly, if the transaction contemplated hereby would be usurious under
applicable law (including the laws of the United States of America, or of any
other jurisdiction whose laws may be mandatorily applicable), then, in that
event, notwithstanding anything to the contrary in this Agreement or the
Subordinated Note, Borrower and Lender agree that the aggregate of all
consideration that constitutes interest under applicable law that is contracted
for, charged or received under or in connection with this Agreement shall under
no circumstances exceed the maximum amount of interest allowed by applicable
law, and any excess shall be credited to Borrower by Lender (or if such
consideration shall have been paid in full, such excess refunded to Borrower by
Lender).
2.8.    Payments on Non-Business Days. Whenever any payment to be made by
Borrower hereunder shall be stated to be due on a day which is not a Business
Day, payments shall be made on the next succeeding Business Day and such
extension of time shall be included in the computation of the payment of
interest hereunder.
2.9.    Application of Payments. All payments received by Lender from or on
behalf of Borrower shall be applied first to amounts due to Lender to reimburse
Lender’s costs and expenses, including those pursuant to Section 5.4 or Section
8.4, second to accrued interest under the Subordinated Note, and third to
principal amounts outstanding under the Subordinated Note; provided, however,
subject to Section 8.1.3 of this Agreement, that after the date on which the
final payment of principal with respect to the Facility is due or following and
during any Event of Default or Unmatured Event of Default, all payments received
on account of Borrower’s Liabilities shall be applied in whatever order,
combination and amounts as Lender, in its sole and absolute discretion, decides,
to all costs, expenses and other indebtedness owing to Lender.
2.10.    Reserved.
2.11.    Redemption. Commencing on or after the fifth anniversary of the Closing
Date, Borrower may, upon at least five (5) Business Days’ notice to Lender,
redeem all or a portion of the principal amount outstanding under the
Subordinated Debt by paying the principal amount to be prepaid, together with
unpaid accrued interest thereon to the date of redemption. With respect to the
premature redemption of Subordinated Debt, Borrower shall pay Lender an amount
in cash equal to (i) 104.0% of the principal amount of Subordinated Debt to be
redeemed on or after

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January 30, 2020 but before January 30, 2022, (ii) 103.0% of the principal
amount of Subordinated Debt to be redeemed if redeemed on or after January 30,
2022 but before January 30, 2025; and (iii) 100.0% of the principal amount of
Subordinated Debt to be redeemed if redeemed on or after January 30, 2025 but
before the Maturity Date, in each case plus unpaid interest accrued thereon to
such redemption date. Borrower acknowledges, under current applicable
regulations, it may not retire its obligations hereunder without the prior
receipt of non-objection or other evidence of acquiescence from the FRB or other
primary regulator (including payment at maturity, or pursuant to an acceleration
clause or redemption prior to maturity). Borrower further acknowledges that
Lender shall have no responsibility to verify whether Borrower has obtained any
such non-objection or other evidence of acquiescence.
2.12.    Right of Offset. Lender hereby expressly waives any right of offset or
recoupment it may have against Borrower.
2.13.    Commitment Fee. Borrower shall pay Lender the Commitment Fee in
consideration of the Facility contemporaneously with the execution of this
Agreement.
3.    DISBURSEMENT.
3.1.    Disbursement. At the Closing Date, assuming all of the terms and
conditions set forth in Section 3.2 have been satisfied by Borrower and Borrower
has executed and delivered to Lender each of the Transaction Documents and any
other related documents in form and substance reasonably satisfactory to Lender,
Lender shall disburse $15,000,000.00 (net of certain legal expenses of up to
$15,000 and the Commitment Fee) to Borrower for the Subordinated Note (the
“Disbursement”).
3.2.    Conditions Precedent to Disbursement. In conjunction with and as
additional (but independent) supporting evidence for certain of the covenants,
representations and warranties made by Borrower herein, prior to and as a
condition of the Disbursement, Borrower shall deliver or cause to be delivered
to Lender each of the following:
3.2.1.    Transaction Documents. The Transaction Documents, including, without
limitation, the Subordinated Note.
3.2.2.    Authority Documents.
3.2.2.1.    A copy, certified by the Secretary or an Assistant Secretary of
Borrower, of the Amended and Restated Articles of Organization of Borrower;
3.2.2.2.    A good standing certificate of Borrower issued by the Massachusetts
Secretary of State;
3.2.2.3.    A copy, certified by the Secretary or an Assistant Secretary of
Borrower, of the Bylaws of Borrower;

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3.2.2.4.    A copy, certified by the Secretary or an Assistant Secretary of
Borrower, of the resolutions of the board of directors of Borrower authorizing
the execution, delivery and performance of this Agreement and the Subordinated
Note; and
3.2.2.5.    An incumbency certificate of the Secretary or an Assistant Secretary
of Borrower certifying the names of the officer or officers of Borrower
authorized to sign this Agreement, the Subordinated Note and the other documents
provided for in this Agreement, together with a sample of the true signature of
each such officer (Lender may conclusively rely on such certificate until
formally advised by a like certificate of any changes therein).
3.2.3.    Other Requirements. Such other additional information regarding
Borrower, Bank, any other Subsidiary of Borrower or Bank and their respective
assets, liabilities (including any liabilities arising from, or relating to,
legal proceedings) and contracts as Lender may reasonably require.
3.2.4.    Other Documents. Such other certificates, affidavits, schedules,
resolutions, opinions, notes and/or other documents which are provided for
hereunder or as Lender may reasonably request.
4.    GENERAL REPRESENTATIONS AND WARRANTIES.
(A)        Borrower hereby represents and warrants to Lender as follows:
4.1.    Organization and Authority.
4.1.1.    Organization Matters. Borrower is validly existing and in good
standing under the laws of The Commonwealth of Massachusetts and has all
requisite corporate power and authority, and possesses all licenses necessary,
to conduct business and activities as presently conducted, to own its properties
and to perform its obligations under this Agreement. Bank is validly existing
and in good standing under the laws of The Commonwealth of Massachusetts and has
all requisite corporate power and authority, and possesses all licenses
necessary, to conduct business and activities as presently conducted and to own
its properties. The deposit accounts of Bank are insured by the FDIC. Borrower
has not received any notice or other information indicating that Bank is not an
“insured depository institution” as defined in 12 U.S.C. Section 1813, nor has
any event occurred which could reasonably be expected to adversely affect the
status of Bank as an FDIC-insured institution. Borrower, Bank and their
Subsidiaries have made payment of all franchise and similar taxes in all of the
respective jurisdictions in which they are incorporated, chartered or qualified,
except for any such taxes (i) where the failure to pay such taxes will not have
a Material Adverse Effect on Borrower, (ii) the validity of which is being
contested in good faith or (iii) for which proper reserves have been set aside
on the books of Borrower, Bank or any applicable Subsidiary, as the case may be.
4.1.2.    Capital Stock and Related Matters. All of the outstanding capital
stock of Bank is owned beneficially and of record by Borrower and has been duly
authorized

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and validly issued and is fully paid and nonassessable. There are, as of the
date hereof, no outstanding rights, warrants or other agreements or instruments
(other than stock options) obligating Borrower to issue, deliver or sell, or
cause to be issued, delivered or sold, additional shares of the capital stock of
Borrower or obligating Borrower to grant, extend or enter into any such
agreement or commitment to any Person.

4.1.3.    Subsidiaries. Each Subsidiary of Borrower and Bank is validly existing
and in good standing under the laws of its jurisdiction or organization, and
each Subsidiary has all requisite power and authority, corporate or otherwise,
and possesses all material licenses necessary, to conduct its business and own
its properties.
4.2.    No Impediment to Transactions.
4.2.1.    Transaction is Legal and Authorized. The issuance of the Subordinated
Debt, the borrowing of the principal amount of the Facility, the execution of
this Agreement and the other Transaction Document and compliance by Borrower
with all of the provisions of this Agreement and of the other Transaction
Document are within the corporate and other powers of Borrower. This Agreement
and the other Transaction Document to which Borrower is a party have been duly
authorized, executed and delivered, and, assuming due authorization, execution
and delivery by the other parties thereto, are the legal, valid and binding
obligations of Borrower, enforceable in accordance with their terms.

4.2.2.    No Defaults or Restrictions. Neither the execution and delivery of the
Transaction Documents nor compliance with their terms and conditions will (a)
violate, conflict with or result in a breach of, or constitute a default under:
(i) any of the terms, obligations, covenants, conditions or provisions of any
corporate restriction or of any contract, agreement, indenture, mortgage, deed
of trust, pledge, bank loan or credit agreement, charter, bylaw or any other
agreement or instrument to which Borrower, Bank or any Subsidiary of Borrower or
Bank is now a party or by which any of them or any of their properties may be
bound or affected; (ii) any judgment, order, writ, injunction, decree or demand
of any court, arbitrator, grand jury, or Governmental Agency; or (iii) any
statute, rule or regulation applicable to Borrower or Bank, except, in each such
case, for such violations and conflicts that would not reasonably be expected to
have, singularly or in the aggregate, a Material Adverse Effect on Borrower or
Bank, or (b) result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any property or asset of Borrower,
Bank or any Subsidiary of Borrower or Bank, except for such liens, charges and
encumbrances that would not reasonably be expected to have, singularly or in the
aggregate, a Material Adverse Effect on Borrower or Bank. None of Borrower, Bank
or any Subsidiary of Borrower or Bank is in default in the performance,
observance or fulfillment of any of the terms, obligations, covenants,
conditions or provisions contained in any indenture or other agreement creating,
evidencing or securing Indebtedness of any kind or pursuant to which any such
Indebtedness is issued, or other agreement or instrument to which Borrower, Bank
or any Subsidiary of Borrower or Bank is a party or by which Borrower, Bank or
any Subsidiary of Borrower or Bank or their respective properties may be bound
or affected, except, in each

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case, only such defaults that would not reasonably be expected to have,
singularly or in the aggregate, a Material Adverse Effect on Borrower or Bank.
4.2.3.    Governmental Consent. No governmental orders, permissions, consents,
approvals or authorizations are required to be obtained by Borrower or Bank that
have not been obtained, and no registrations or declarations are required to be
filed by Borrower or Bank in connection with, or, contemplation of, the
execution and delivery of, and performance under, this Agreement and the other
Transaction Document that have not been filed, other than such orders,
permissions, consents, approvals, authorizations, registrations and declarations
that would not reasonably be expected to have, singularly or in the aggregate, a
Material Adverse Effect on Borrower or Bank.
4.3.    Possession of Licenses and Permits. Each of Borrower, Bank and the
Subsidiaries of Borrower or Bank possesses such permits, licenses, approvals,
consents and other authorizations (collectively, “Governmental Licenses”) issued
by the appropriate Governmental Agencies necessary to conduct the business now
operated by it, except where the failure to possess such Governmental Licenses
would not, singularly or in the aggregate, have a Material Adverse Effect on
Borrower or Bank; each of the Borrower, Bank and their respective Subsidiaries
is in compliance with the terms and conditions of all such Governmental
Licenses, except where the failure so to comply would not, singularly or in the
aggregate have a Material Adverse Effect on Borrower or Bank; all of the
Governmental Licenses are valid and in full force and effect, except when the
invalidity of such Governmental Licenses or the failure of such Governmental
Licenses to be in full force and effect would not have a Material Adverse Effect
on Borrower or Bank; and neither Borrower nor Bank nor any Subsidiary of
Borrower or Bank has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses which, singularly
or in the aggregate, in the reasonable judgment of Borrower, is likely to result
in a Material Adverse Effect on Borrower or Bank.
4.4.    Financial Condition.
4.4.1.    Borrower Financial Statements. Borrower has made available to Lender
copies of its consolidated and consolidating financial statements (the “2013
Financial Statements”) as of and for the 12 months ended December 31, 2013
audited by Borrower’s Accountant. The 2013 Financial Statements are true and
correct in all material respects, have been prepared by the Borrower’s
Accountant in accordance with the respective books of account and records of
Borrower, Bank and their Subsidiaries and have been prepared in accordance with
applicable banking regulations, rules and guidelines and with GAAP on a basis
consistent with prior periods, and fairly and accurately present in all material
respects the consolidated financial condition of Borrower, Bank and their
Subsidiaries and their assets and liabilities and the results of their
operations as of, and for the period ending at, such date. In addition, Borrower
has delivered or made available to Lender copies of its consolidated and
consolidating financial statements for the period ended December 31, 2014 (“2014
Financial Statements” and together with the Borrower 2013 Financial Statements,
the “Borrower Financial Statements”). The 2014 Financial Statements are true and
correct in all material respects, have been prepared in accordance with the
respective books of account

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and records of Borrower, Bank and their Subsidiaries and have been prepared in
accordance with applicable banking regulations, rules and guidelines and with
GAAP, without footnotes and subject to yearend adjustments, on a basis
consistent with prior periods, and, to Borrower’s Knowledge, fairly and
accurately present in all material respects the financial condition of Borrower,
Bank and their Subsidiaries and their assets and liabilities and the results of
their operations as of, and for the period ending at, such date. The Borrower
Financial Statements contain and reflect provisions for taxes, reserves and
other liabilities of Borrower and Bank in accordance with applicable banking
regulations, rules and guidelines, respectively, except for such provisions that
would not reasonably be expected to have, singularly or in the aggregate, a
Material Adverse Effect on Borrower or Bank. Neither Borrower nor Bank has any
material debt, liability or obligation of any nature (whether accrued,
contingent, absolute or otherwise) which is not provided for or disclosed in the
Borrower Financial Statements.
4.4.2.    Absence of Default. No event has occurred which either of itself or
with the lapse of time or the giving of notice or both, would give any creditor
of Borrower the right to accelerate the maturity of any material Indebtedness of
Borrower or Bank. Neither Borrower nor Bank is in default under any other lease,
agreement or instrument, or any law, rule, regulation, order, writ, injunction,
decree, determination or award, non-compliance with which could reasonably be
expected to result in a Material Adverse Effect on Borrower or Bank.
4.4.3.    Loans. To Borrower’s Knowledge, each loan having an outstanding
balance of more than $2,500,000 and reflected as an asset of Borrower or Bank in
the Borrower Financial Statements is the legal, valid and binding obligation of
the obligor named therein, enforceable in accordance with its terms. To
Borrower’s Knowledge, (a) no obligor named therein is seeking to avoid the
enforceability of the terms of any loan, and (b) no loan having an unpaid
balance (principal and accrued interest) in excess of $2,500,000 is subject to
any defense, offset or counterclaim.
4.4.4.    Allowance for Loan Losses. The allowance for loan losses of Bank shown
in the Borrower Financial Statements has been established in a manner consistent
with past practices and in accordance with applicable regulatory guidelines and,
to the best of Borrower’s Knowledge, is adequate in all material respects to
provide for losses, net of recoveries relating to loans previously charged off,
on loans and leases outstanding as of the date of such statements or reports.
4.4.5.    Solvency. After giving effect to the consummation of the transactions
contemplated by this Agreement, Borrower and Bank each has working capital
sufficient to carry on its business and transactions and all businesses and
transactions in which it is about to engage and is solvent and able to pay its
debts as they mature. No transfer of property is being made and no Indebtedness
is being incurred in connection with the transactions contemplated by this
Agreement with the intent to hinder, delay or defraud either present or future
creditors of Borrower, Bank or any Subsidiary of Borrower or Bank.

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4.5.    Title to Properties.
4.5.1.    Owned Property. For assets or property owned by Borrower, Bank or any
Subsidiary of Borrower or Bank, Borrower, Bank and their Subsidiaries have,
respectively, good and marketable fee title to all the owned Properties, and
good and marketable title to all other property and assets reflected in the
Borrower Financial Statements, except for (a) real property and other assets
acquired and/or being acquired from debtors in full or partial satisfaction of
obligations owed to Bank, (b) property or other assets leased by Borrower, Bank
or their Subsidiaries, and (c) property and assets sold or otherwise disposed of
in the ordinary course of business subsequent to the date of the Borrower
Financial Statements.
4.5.2.    Leased Property. For assets or property leased by Borrower, Bank or
any Subsidiary of Borrower or Bank, Borrower, Bank and each such Subsidiary
enjoy peaceful and undisturbed possession under all of the Leases under which
they are operating, all of which permit the customary operations of Borrower,
Bank and any Subsidiary of Borrower or Bank, as applicable. None of such Leases
is in material default and no event has occurred which with the passage of time
or the giving of notice, or both, would constitute a default that is reasonably
likely to have a Material Adverse Effect on Borrower or Bank.
4.6.    No Material Adverse Change. Since September 30, 2014, to Borrower’s
Knowledge, neither the business, operations, properties nor assets of Borrower,
Bank or any Subsidiary of Borrower or Bank have been materially and adversely
affected in any way, as the result of any act or event, including, without
limitation, fire, explosion, accident, act of God, strike, lockout, flood,
drought, storm, earthquake, combination of workmen or other labor disturbance,
riot, activity of armed forces or of the public enemy, embargo, or
nationalization, condemnation, requisition or taking of property, or
cancellation or modification of contracts, by any domestic or foreign government
or any instrumentality or agency thereof. Since September 30, 2014, there has
been no development or event which has had or could reasonably be expected to
have a Material Adverse Effect on Borrower or Bank other than changes arising
from transactions in the ordinary course of business, and none of such changes
has been materially adverse, whether in the ordinary course of business or
otherwise.

4.7.    Legal Matters.

4.7.1.    Compliance with Law. Borrower, Bank and their respective Subsidiaries
have complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government, or any instrumentality or
agency thereof, having jurisdiction over the conduct of their respective
businesses or the ownership of their respective properties, except where any
such failure to comply would not reasonably be expected to have a Material
Adverse Effect on Borrower or Bank.
4.7.2.    Taxes. Except where any failure to file would not reasonably be
expected to have a Material Adverse Effect on Borrower or Bank, Borrower, Bank
and each Subsidiary of Borrower or Bank have filed all United States income tax
returns and all state

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and municipal tax returns which are required to be filed, and have paid, or made
adequate provision for the payment of, all material taxes which have become due
pursuant to said returns or pursuant to any assessment received by Borrower,
Bank or any Subsidiary of Borrower or Bank, except such taxes, if any, as are
being contested in good faith and as to which adequate reserves have been
provided. Borrower is unaware of any audit, assessment or other proposed action
or inquiry of the Internal Revenue Service with respect to the United States
income tax liability of Borrower, Bank or any Subsidiary of Borrower or Bank. To
Borrower’s Knowledge, Borrower, Bank and each Subsidiary of Borrower or Bank
have withheld amounts from their employees, shareholders or holders of public
deposit accounts in full and complete compliance with the tax withholding
provisions of applicable federal, state and local laws and each has filed all
federal, state and local returns and reports for all years for which any such
return or report would be due with respect to employee income tax withholding,
social security, unemployment taxes, income and other taxes and all payments or
deposits with respect to such taxes have been made within the time period
required by law.
4.7.3.    Regulatory Enforcement Actions. None of Borrower, Bank, any Subsidiary
of Borrower or Bank or any of their respective officers or directors in such
respective capacities is now operating under any restrictions, agreements,
memoranda, or commitments (other than restrictions of general application)
imposed by any Governmental Agency, nor are, to Borrower’s Knowledge, (a) any
such restrictions threatened or (b) any agreements, memoranda or commitments
being sought by any Governmental Agency.
4.7.4.    Pending Litigation. There are no actions, suits, proceedings or
written agreements pending, or, to Borrower’s Knowledge, threatened or proposed,
against Borrower, Bank or any Subsidiary of Borrower or Bank at law or in equity
or before or by any federal, state, municipal, or other governmental department,
commission, board, or other administrative agency, domestic or foreign, that,
either separately or in the aggregate, would reasonably be expected to have a
Material Adverse Effect on Borrower or Bank or affect issuance or payment of the
Subordinated Note; and none of Borrower, Bank or any Subsidiary of Borrower or
Bank is in default with respect to any order, writ, injunction, or decree of, or
any written agreement with, any court, commission, board or agency, domestic or
foreign, that, either separately or in the aggregate, will have a Material
Adverse Effect on Borrower or Bank.
4.7.5.    Environmental. No Property is or, to Borrower’s Knowledge, has been a
site for the use, generation, manufacture, storage, treatment, release,
threatened release, discharge, disposal, transportation or presence of any
Hazardous Materials that would reasonably be expected to have a Material Adverse
Effect on Borrower or Bank and neither Borrower nor Bank nor any Subsidiary of
Borrower or Bank has engaged in such activities. Each Property, and Borrower,
Bank and each Subsidiary of Borrower or Bank, are in material compliance with
all Hazardous Materials Laws. There are no claims or actions (“Hazardous
Materials Claims”) pending or, to Borrower’s Knowledge, threatened against
Borrower, Bank or any Subsidiary of Borrower or Bank or any Property by any
Governmental Agency or by any other Person relating to any Hazardous Materials
or pursuant to any Hazardous Materials Law.

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4.7.6.    Brokerage Commissions. Neither Borrower nor any Affiliate of Borrower
is obligated to pay any brokerage commission or finder’s fee to any Person in
connection with the transactions contemplated by this Agreement.
4.7.7.    Anti-Money Laundering. Borrower, Bank and their respective
Subsidiaries are in compliance in all material respects with the applicable
financial recordkeeping and reporting requirements of the Currency and Foreign
Transaction Reporting Act of 1970, as amended, and the rules and regulations
thereunder. Borrower, Bank and Subsidiaries of Borrower or Bank have established
compliance programs reasonably designed to provide for compliance with the
requirements of the USA PATRIOT Act and all applicable regulations promulgated
thereunder. Borrower and its Subsidiaries are in compliance in all material
respects with the USA PATRIOT Act and all applicable regulations promulgated
thereunder, and there is no charge, investigation, action, suit or proceeding
before any court, regulatory authority or governmental agency or body pending
or, to Borrower’s Knowledge, threatened regarding the compliance by Borrower,
Bank and their respective Subsidiaries with the USA PATRIOT Act or any
regulations promulgated thereunder, except as disclosed in writing to the
Lender.
4.7.8.    No Registration. It is not necessary in connection with the offer,
sale and delivery of the Subordinated Note to the Lender to register the
Subordinated Note under the Securities Act of 1933, as amended (the “Securities
Act”).
4.8.    Borrower Status.
4.8.1.    Non-Foreign Status. Borrower is not a nonresident alien for purposes
of U.S. income taxation and is not a foreign corporation, foreign partnership,
foreign trust or foreign estate (as said terms are defined in the Code or the
regulations promulgated thereunder).
4.8.2.    Investment Company Act. Borrower is not an “investment company” or a
company “controlled” by an “investment company,” within the meaning of the
Investment Company Act of 1940, as amended.
4.8.3.    No Burdensome Agreements. None of Borrower, Bank or any Subsidiary of
Borrower or Bank is a party to any agreement, instrument or undertaking or
subject to any other restriction (a) which currently has a Material Adverse
Effect on Borrower or Bank, or (b) under or pursuant to which Borrower, Bank or
any Subsidiary of Borrower or Bank is or will be required to place (or under
which any other Person may place) a lien upon any of its material properties
securing Indebtedness either upon demand or upon the happening of a condition,
with or without such demand.
4.8.4.    Foreign Qualifications. Borrower, Bank and each of the Subsidiaries of
Borrower and Bank is duly qualified as a foreign corporation to transact
business and is each in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where

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the failure to so qualify or be in good standing would not result in any
Material Adverse Effect on Borrower or Bank, considered as one enterprise.
4.9.    No Misstatement. No information, exhibit, report, schedule or document,
when viewed together as a whole, furnished by Borrower or Bank to Lender in
connection with the negotiation, execution or performance of this Agreement or
the funding of the Facility contains any untrue statement of a material fact,
or, to the Knowledge of Borrower, omits to state a material fact or any fact
necessary to make the statements contained herein not misleading in light of the
circumstances when made or furnished to Lender and as of the Closing Date.
4.10.    Representations and Warranties Generally. The representations and
warranties set forth in this Agreement or in the other Transaction Document will
be true and correct (a) on the date of this Agreement, (b) as of the date of the
Disbursement, and (c) as otherwise specifically provided herein. All
representations, warranties, covenants and agreements made in this Agreement or
in any certificate or other document delivered to Lender by or on behalf of
Borrower or Bank pursuant to or in connection with this Agreement shall be
deemed to have been relied upon by Lender notwithstanding Lender’s review of any
documents or materials delivered by Borrower or Bank to Lender pursuant to the
terms hereof and notwithstanding any investigation heretofore or hereafter made
by Lender or on their behalf (and Borrower hereby acknowledges such reliance by
Lender in making the Facility and all disbursements thereunder) and,
furthermore, shall survive the making of any or all of the disbursements of
proceeds under the Facility and continue in full force and effect as long as
there remains unperformed any obligations to Lender hereunder or under the other
Transaction Documents.
(B)    Lender hereby represents and warrants to Borrower as follows:
4.11.    Lender Status.
4.11.1.    Lender is a “qualified institutional buyer” as defined in Rule 144A
under the Securities Act with such knowledge and experience in financial and
business matters as is necessary in order to evaluate the merits and risks of an
investment in the Subordinated Note.
4.11.2.    Lender is acquiring the Subordinated Note for its own account for
investment, and not with a view to any distribution, resale, subdivision, or
fractionalization thereof in violation of the Securities Act or any other
applicable domestic or foreign securities law, and Lender has no present plans
to enter into any contract, undertaking, agreement, or arrangement for any such
distribution, resale, subdivision, or fractionalization. The Subordinated Note
is not being acquired, directly or indirectly, as nominee, trustee or
representative of or for any other person or persons.

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5.    GENERAL COVENANTS, CONDITIONS AND AGREEMENTS. Borrower hereby further
covenants and agrees with Lender as follows:
5.1.    Compliance with Transaction Documents. Borrower shall comply with,
observe and timely perform each and every one of the covenants, agreements and
obligations under the Transaction Documents.
5.2.    Certain Transactions; Business Operations.
5.2.1.    Merger and Consolidation. Borrower shall not sell to, consolidate with
or merge or engage in any similar transaction with any Person unless: (a) the
successor entity which results from such consolidation or merger, if not
Borrower (the “Surviving Entity”), shall have executed and delivered to the
holder of the Subordinated Note its assumption of the due and punctual payment
of the principal of and premium, if any, and interest on the Subordinated Note,
and the due and punctual performance and observation of all of the covenants in
the Subordinated Note and this Agreement to be performed or observed by Borrower
and shall furnish to such holder an opinion of counsel in form and substance
reasonably satisfactory to such holder to the effect that the instrument of
assumption has been duly authorized, executed and delivered and constitutes the
legal valid and binding contract and agreement of the Surviving Entity
enforceable in accordance with its terms, except as enforcement of such terms
may be limited by bankruptcy, insolvency, reorganization, moratorium and similar
laws affecting the enforcement of creditors’ rights generally and by general
equitable principles; and (b) immediately after giving effect to such
transaction and treating any Indebtedness that becomes an obligation of Borrower
or any of its Subsidiaries as a result of such transaction as having been
incurred by Borrower or such Subsidiary at the time of such transaction, no
Event of Default or Unmatured Event of Default would exist.
5.2.2.    Banking Practices. Borrower shall not itself, nor shall it cause or
knowingly permit or allow Bank or any Subsidiary of Borrower or Bank to engage
in any unsafe or unsound banking practices as determined by a Governmental
Agency, which would reasonably be expected to constitute a Material Adverse
Effect on Borrower or Bank.
5.2.3.    Affiliate Transactions. Borrower shall not itself, nor shall it cause,
permit or allow Bank or any Subsidiary of Borrower or Bank to enter into any
transaction including, without limitation, the purchase, sale or exchange of
property or the rendering of any service, with any Affiliate of Borrower or Bank
except upon terms consistent with applicable laws and regulations and reasonably
found by the appropriate board(s) of directors or management officials to whom
the board(s) of directors have delegated authority to be fair and reasonable and
no less favorable to Borrower, Bank or such Affiliate than would be obtained in
a comparable arm’s-length transaction with a Person not an Affiliate.
5.2.4.    Insurance. At its sole cost and expense, Borrower shall maintain, and
shall cause Bank and each Subsidiary of Borrower or Bank to maintain, bonds and
insurance to such extent, covering such risks as is required by law, or as is
usual and customary for owners of similar businesses and properties in the same
general area in which Borrower, Bank or a Subsidiary of Borrower or Bank
operates. All such bonds and policies of insurance shall

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be in a form, in an amount and with issuers/insurers recognized as adequate by
prudent business persons.
5.3.    Compliance with Laws.
5.3.1.    Generally. Borrower shall comply and cause Bank and each Subsidiary of
Borrower or Bank to comply in all material respects with all applicable
statutes, rules, regulations, orders and restrictions in respect of the conduct
of their respective businesses and the ownership of their respective properties,
except, in each case, where such noncompliance would not reasonably be expected
to have a Material Adverse Effect on Borrower or Bank.
5.3.2.    Regulated Activities. Borrower shall not itself, nor shall it cause or
knowingly permit or allow Bank or any Subsidiary of Borrower or Bank to (a)
engage in any business or activity not permitted by all applicable laws and
regulations, except where such business or activity would not reasonably be
expected to have a Material Adverse Effect on Borrower or Bank or (b) make any
loan or advance secured by the capital stock of another bank or depository
institution, or acquire the capital stock, assets or obligations of or any
interest in another bank or depository institution, in each case other than in
accordance with applicable laws and regulations and safe and sound banking
practices.
5.3.3.    Taxes. Borrower, Bank or any Subsidiary of Borrower or Bank shall
promptly pay and discharge all taxes, assessments and other governmental charges
imposed upon Borrower, Bank or any Subsidiary of Borrower or Bank or upon the
income, profits, or property of Borrower, Bank or any Subsidiary of Borrower or
Bank and all claims for labor, material or supplies which, if unpaid, might by
law become a lien or charge upon the property of Borrower, Bank or any
Subsidiary of Borrower or Bank. Notwithstanding the foregoing, none of Borrower,
Bank or any Subsidiary of Borrower or Bank shall be required to pay any such
tax, assessment, charge or claim, so long as the validity thereof shall be
contested in good faith by appropriate proceedings, and reserves therefor shall
be maintained on the books of Borrower, Bank and such Subsidiary as deemed
appropriate by Borrower’s independent certified public accountants.
5.3.4.    Environmental Matters. Except as would not, singularly or in the
aggregate, reasonably be expected to result in a Material Adverse Effect on
Borrower or Bank, Borrower shall: (a) exercise, and cause Bank and each
Subsidiary of Borrower or Bank to exercise, due diligence in order to comply in
all respects with all Hazardous Materials Laws; and (b) promptly take any and
all necessary remedial action in connection with any Condition or Release or
threatened Condition or Release on, under or about any Property in order to
comply with all applicable Hazardous Materials Laws; provided, however, that
such Borrower shall not be deemed to be in breach of the foregoing covenant if
and to the extent it has not taken such remedial actions due to (x) its diligent
pursuit of an available statutory or administrative exemption from compliance
with the relevant Hazardous Materials Law from the appropriate Governmental
Agency (and no penalties for non-compliance with the relevant Hazardous
Materials Law(s) shall accrue as a result of such non-compliance, without rebate
or waiver if such exemption or waiver is granted), or (y) is actively and
diligently contesting

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in good faith any Governmental Agency’s order, determination or decree with
respect to the applicability or interpretation of any such relevant Hazardous
Materials Law and/or the actions required under such laws or regulations in
respect of such Condition or Release. In the event Borrower, Bank or any
Subsidiary of Borrower or Bank undertakes any remedial action with respect to
such Hazardous Material on, under or about any Property, Borrower, Bank or such
Subsidiary shall conduct and complete such remedial action in compliance with
all applicable Hazardous Materials Laws and in accordance with the policies,
orders and directives of all Governmental Agencies.
5.3.5.    Reserved.
5.3.6.    Corporate Existence. Borrower shall do or cause to be done all things
reasonably necessary to maintain, preserve and renew its corporate existence and
that of Bank and the Subsidiaries of Borrower and Bank and its and their rights
and franchises, and comply in all material respects with all related laws
applicable to Borrower, Bank or the Subsidiaries of Borrower or Bank; provided,
however, that Borrower may consummate a merger, consolidation, sale or other
similar transaction only in accordance with Section 5.2.1.
5.4.    Certain Expenses. Borrower will pay all reasonable costs and expenses of
Lender incident to the transactions contemplated by this Agreement incurred by ,
counsel to Lender in this transaction, in connection with its preparation,
negotiation and execution of the Transaction Documents up to $15,000, and pay
and save Lender and all other holders of the Subordinated Note harmless against
any and all liability with respect to amounts payable as a result of any
interest or penalties resulting from nonpayment or delay in payment of such
expenses, charges, disbursements or liabilities. The obligations of Borrower
under this Section 5.4 shall survive the repayment in full of the Subordinated
Note.
6.    REPORTING. Borrower shall furnish and deliver or cause to be furnished and
delivered to Lender:
6.1.    Annual. As soon as available and in any event within one-hundred twenty
(120) days after the close of each fiscal year of Borrower, or within such
further time as Lender may permit, consolidated and consolidating audited
financial statements for Borrower, Bank and their respective Subsidiaries,
including a balance sheet and related profit and loss statement, prepared in
accordance with GAAP consistently applied throughout the periods reflected
therein. Such financial statements shall be accompanied by the unqualified
opinion of Borrower’s Accountant or other independent certified public
accountants reasonably acceptable to Lender.
6.2.    Quarterly. As soon as available and in any event within forty-five (45)
days after the close of each quarterly period of each fiscal year of Borrower,
(a) reports filed by Borrower with state or federal bank regulatory agencies
including, without limitation, each quarterly FR Y-9LP filed by Borrower with
the FRB, and (b) each call report of Bank filed with Governmental Agencies.

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6.3.    Periodic. Promptly after sending, making available or filing same,
copies of all other reports, proxy statements or financial statements that
Borrower makes available to its stockholders and all registration statements and
reports that Borrower files with the Securities and Exchange Commission.
7.    FINANCIAL COVENANT. Borrower shall maintain such capital as may be
necessary to cause Borrower and Bank to be classified at all times as
“adequately capitalized”, in accordance with the rules and regulations of their
respective primary federal regulators, as in effect from time to time and
consistent with the financial information and reports contemplated in Section 6.
For purposes of this Section, Borrower shall be deemed to be “adequately
capitalized” if it would be considered to be adequately capitalized under the
criteria set forth in the FRB’s prompt corrective action regulation for state
member banks (12 C.F.R. §208.40 et seq.).
8.    BORROWER’S DEFAULT.
8.1.    Borrower’s Defaults and Lender’s Remedies.
8.1.1.    Events of Default. Notwithstanding any cure periods described below,
Borrower shall immediately notify Lender in writing when Borrower obtains
Knowledge of the occurrence of any default specified below. Regardless of
whether Borrower has given the required notice, the occurrence of one or more of
the following will constitute an “Event of Default” under this Agreement:
8.1.1.1.    Borrower fails to pay, when due, any principal of or installment of
interest on the Subordinated Note; or
8.1.1.2.    Borrower fails to pay, when due, any amount payable under this
Agreement, the Subordinated Note (other than principal or interest) and such
failure continues for a period of five (5) Business Days after Knowledge thereof
by Borrower; or
8.1.1.3.    Borrower fails to keep or perform any of its agreements,
undertakings, obligations, covenants or conditions under this Agreement not
expressly referred to in another clause of this Section 8.1.1 and such failure
continues for a period of sixty (60) days after Knowledge thereof by Borrower;
or

8.1.1.4.    Any “Event of Default” or “Default” as defined under, or a default
or breach in any respect by Borrower of any representation, warranty, covenant
or agreement under, any of the Transaction Documents occurs and is not cured
within sixty (60) days thereof; or
8.1.1.5.    Any certification made pursuant to this Agreement by Borrower or
otherwise made in writing in connection with or as contemplated by this
Agreement or the other Transaction Document by Borrower shall be materially
incorrect or false as of the delivery date of such certification, or any
representation to Lender by Borrower as to the financial condition or credit
standing of Borrower is or proves to be false or misleading; or

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8.1.1.6.    Any order or decree is entered by any court of competent
jurisdiction directly or indirectly enjoining or prohibiting Lender or Borrower
from performing any of their obligations under this Agreement or the other
Transaction Document, and such order or decree is not vacated, and the
proceedings out of which such order or decree arose are not dismissed, within
sixty (60) days after the granting of such decree or order; or
8.1.1.7.    Borrower shall fail to comply with Section 7 hereof; or
8.1.1.8.    Final judgment or judgments for the payment of no less than
$1,000,000 in the aggregate is or are outstanding against Borrower or against
any of its property or assets, and any one or more of such judgments equal to no
less than $1,000,000 in the aggregate has remained unpaid, unvacated, unbonded
or unstayed by appeal or otherwise for a period of sixty (60) days from the date
of its entry; or
8.1.1.9.    Borrower is notified that it is considered an institution in
“troubled condition” within the meaning of 12 C.F.R. §225.71 or any successor
regulation; or
8.1.1.10    (i) Borrower (a) becomes insolvent or is unable to pay its debts as
they mature, or (b) admits in writing its inability to pay its debts as they
mature, or (ii) Bank ceases doing business as a depository institution; or
8.1.1.11    The entry by a court having jurisdiction in the premises of (i) a
decree or order for relief in respect of Borrower in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (ii) a decree or order appointing a
custodian, receiver, liquidator, assignee (other than as provided by Section
5.2.1), trustee, sequestrator or other similar official of Borrower or of all or
substantially all of its property, or ordering the winding up or liquidation of
its affairs, and the continuance of any such decree or order for relief or any
such other decree or order unstayed and in effect for a period of sixty (60)
consecutive days; or
8.1.1.12    The commencement by Borrower of a voluntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or the consent by Borrower to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver, liquidator,
assignee (other than as provided by Section 5.2.1), trustee, sequestrator or
similar official of Borrower or of all or substantially all of its property, or
the making by Borrower of an assignment for the benefit of creditors, or the
admission by Borrower in writing of its inability to pay its debts generally as
they become due, or the taking of corporate action by Borrower in furtherance of
any such action; or
8.1.1.13    Following the expiration of any grace period applicable thereto,
Borrower, Bank or any Subsidiary of Borrower or Bank continues to be in default
in any payment of principal or interest for any other obligation, in the
performance of any other term, condition or covenant contained in any agreement
(including, without limitation, an agreement in connection with the acquisition
of capital equipment on a title retention or net

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lease basis) under which any such obligation is created the effect of which
default is to cause or permit the holder of such obligation to cause such
obligation to become due prior to its stated maturity if the aggregate amount
that becomes due in such manner is in excess of $500,000; or
8.1.1.14    Borrower shall have been in material breach of any of the
representations and warranties set forth in Section 4 hereof as of the date of
this Agreement.
8.1.2    Lender’s Remedies. Upon the occurrence of any Event of Default, Lender
shall have the right, if such Event of Default shall then be continuing, to do
any or all of the following, concurrently or successively, without notice to
Borrower:
8.1.2.1.    Solely pursuant to Sections 8.1.1.11, or 8.1.1.12, declare the
Subordinated Note to be, and it shall thereupon become, immediately due and
payable, subject to approval by Governmental Agencies, as applicable, without
presentation, demand, protest or notice of any kind, all of which are hereby
expressly waived, anything contained herein or in the Subordinated Note to the
contrary notwithstanding; or
8.1.2.2    With respect to any Event of Default other than pursuant to Sections
8.1.1.11, or 8.1.1.12, exercise all of its rights and remedies at law or in
equity other than declaring the Subordinated Note to be immediately due and
payable or otherwise seeking to accelerate the repayment of principal.
8.1.2.3.    If Borrower ceases or elects to cease to be subject to the
supervision and regulations of the FRB or similar regulatory authority
overseeing bank, thrift, savings and loan or financial holding companies or
similar institutions requiring specifications for the treatment of capital
similar in nature to the capital adequacy guidelines under the rules and
regulations of any Governmental Agency, then the Lender may declare the
Subordinated Note to be, and it shall thereupon become, immediately due and
payable upon the occurrence of any Event of Default set forth in Section 8.1.1.
8.2.    Other Remedies. Nothing in this Article 8 is intended to restrict
Lender’s rights under any of the other Transaction Documents, other related
documents, or at law or in equity, and Lender may exercise such rights and
remedies as and when they are available, other than to declare the Subordinated
Note to be immediately due and payable or otherwise seeking to accelerate the
repayment of principal, which remedy may only be exercised as and to the extent
permitted pursuant to Section 8.1.2.1 or Section 8.1.2.3.
8.3.    Borrower’s Covenants Upon Event of Default. Upon the occurrence and
during the continuance of any Event of Default, Borrower agrees that (a) it
shall not declare or pay any dividends to its stockholders, other than dividends
that are payable solely in capital stock of Borrower and (b) it shall not
increase the annual salary or bonuses payable to its Chief Executive Officer.

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8.4.    No Lender Liability. To the extent permitted by law, Lender shall have
no liability for any loss, damage, injury, cost or expense resulting from any
action or omission by it, or any of its representatives, except for its or their
own gross negligence or willful misconduct.
8.5.    Lender’ Fees and Expenses. In case of any Event of Default or Unmatured
Event of Default hereunder, Borrower shall pay Lender’s reasonable fees and
expenses including, without limitation, reasonable attorneys’ fees and expenses,
in connection with the enforcement of this Agreement or the other Transaction
Documents, provided such fees and expenses are not incurred to achieve a result
inconsistent with 12 C.F.R. § 250.166.
9.    MISCELLANEOUS.
9.1        Release; Indemnification. Borrower hereby releases Lender and its
Affiliates from any and all causes of action, claims or rights which Borrower
may now or hereafter have for, or which may arise from, any loss or damage in
connection with (a) any failure of Lender to protect, enforce or collect in
whole or in part any of the Facility and (b) any other act or omission to act on
the part of Lender, its Affiliates in connection with the Facility and any other
transactions contemplated by the other Transaction Documents, except in each
instance for willful misconduct, gross negligence or a breach of the Transaction
Documents by Lender. Borrower shall indemnify, defend and hold Lender and its
Affiliates harmless from and against any and all losses, liabilities,
obligations, penalties, claims, fines, demands, litigation, defenses, costs,
judgments, suits, proceedings, actual damages, disbursements or expenses of any
kind or nature whatsoever (including, without limitation, reasonable attorneys’
fees and expenses) which may at any time be either directly or indirectly
imposed upon, incurred by or awarded against Lender or any of Lender’s
Affiliates in connection with, arising from or relating to Lender’s entering
into or carrying out the terms of this Agreement or being the holder of the
Subordinated Note, unless Borrower establishes that the loss, liability,
obligations, penalty, claim, fine, demand, litigation, defense, cost, judgment,
suit, proceeding, damage, disbursement or expense arose primarily by reason of
Lender’s or any of Lender’s Affiliates’ willful misconduct or gross negligence.
9.2.    Prohibition on Assignment. Borrower may not assign, transfer or delegate
any of its rights under this Agreement or the Subordinated Note without the
prior written consent of Lender.
9.3.    Time of the Essence. Time is of the essence with respect to every
provision of this Agreement.
9.4.    Waiver or Amendment. No waiver or amendment of any term, provision,
condition, covenant or agreement herein contained shall be effective unless set
forth in a writing signed by Lender, and any such waiver or amendment shall be
effective only to the extent set forth in such writing. No failure to exercise
or delay in exercising, by Lender or any holder of the Subordinated Note, of any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power or privilege preclude any
other or further exercise thereof, or the exercise of any other right or remedy
provided by law. The rights and remedies provided in this Agreement are
cumulative and not exclusive of any right or remedy provided by law or equity.
No notice or demand on Borrower in any case shall, in itself, entitle

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Borrower to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of Lender to any other or
further action in any circumstances without notice or demand. No consent or
waiver, expressed or implied, by Lender to or of any breach or default by
Borrower in the performance of its obligations hereunder shall be deemed or
construed to be a consent or waiver to or of any other breach or default in the
performance of the same or any other obligations of Borrower hereunder. Failure
on the part of Lender to complain of any acts or failure to act or to declare an
Event of Default, irrespective of how long such failure continues, shall not
constitute a waiver by Lender of rights hereunder or impair any rights, powers
or remedies on account of any breach or default by Borrower.
9.5.    Severability. Any provision of this Agreement which is unenforceable or
invalid or contrary to law, or the inclusion of which would adversely affect the
validity, legality or enforcement of this Agreement, shall be of no effect and,
in such case, all the remaining terms and provisions of this Agreement shall
subsist and be fully effective according to the tenor of this Agreement the same
as though any such invalid portion had never been included herein.
Notwithstanding any of the foregoing to the contrary, if any provisions of this
Agreement or the application thereof are held invalid or unenforceable only as
to particular persons or situations, the remainder of this Agreement, and the
application of such provision to persons or situations other than those to which
it shall have been held invalid or unenforceable, shall not be affected thereby,
but shall continue valid and enforceable to the fullest extent permitted by law.
9.6.    Usury; Revival of Liabilities. The parties hereto intend to conform
strictly to applicable usury laws as in effect from time to time during the term
of the Facility. Accordingly, if the transaction contemplated hereby would be
usurious under applicable law (including the laws of the United States of
America, or of any other jurisdiction whose laws may be mandatorily applicable),
then, in that event, notwithstanding anything to the contrary in this Agreement
or the Subordinated Note, Borrower and Lender agree that the aggregate of all
consideration that constitutes interest under applicable law that is contracted
for, charged or received under or in connection with this Agreement shall under
no circumstances exceed the maximum amount of interest allowed by applicable
law, and any excess shall be credited to Borrower by Lender (or if such
consideration shall have been paid in full, such excess refunded to Borrower by
Lender). To the extent that Lender receives any payment on account of Borrower’s
Liabilities and any such payment(s) and/or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside,
subordinated and/or required to be repaid to a trustee, receiver or any other
Person under any bankruptcy act, state or federal law, common law or equitable
cause, then to the extent of such payment(s) or proceeds received, Borrower’s
Liabilities or part thereof intended to be satisfied shall be revived and
continue in full force and effect, as if such payment(s) and/or proceeds had not
been received by Lender and applied on account of Borrower’s Liabilities;
provided, however, if Lender successfully contests any such invalidation,
declaration, set aside, subordination or other order to pay any such payment
and/or proceeds to any third party, the revived Borrower’s Liabilities shall be
deemed satisfied.
9.7.    Notices. Any notice which any party hereto may be required or may desire
to give hereunder shall be deemed to have been given if in writing and if
delivered personally, or if mailed,

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postage prepaid, by United States registered or certified mail, return receipt
requested, or if delivered by a responsible overnight courier, addressed:

if to Borrower:
Enterprise Bancorp, Inc.
 
222 Merrimack Street
 
Lowell, MA 01850
 
Attention: Chief Executive Officer
 
 
if to Lender:
 
 
 
 
 
 

or to such other address or addresses as the party to be given notice may have
furnished in writing to the party seeking or desiring to give notice, as a place
for the giving of notice, provided that no change in address shall be effective
until seven (7) days after being given to the other party in the manner provided
for above. Any notice given in accordance with the foregoing shall be deemed
given when delivered personally or, if mailed, five (5) Business Days after it
shall have been deposited in the United States mails as aforesaid or, if sent by
overnight courier, the Business Day following the date of delivery to such
courier.
9.8.    Successors and Assigns. This Agreement shall inure to the benefit of the
parties and their respective heirs, legal representatives, successors and
assigns except that, unless Lender consents in writing, no assignment made by
Borrower in violation of this Agreement shall be effective or confer any rights
on any purported assignee of Borrower. For purposes of this Section 9.8 a
successor-in-interest of Borrower by means of an acquisition, merger,
consolidation or similar transaction shall not require approval of Lender.
9.9.    No Joint Venture. Nothing contained herein or in any document executed
pursuant hereto and no action or inaction whatsoever on the part of a Lender,
shall be deemed to make Lender a partner or joint venturer with Borrower.
9.10.    Documentation. All documents and other matters required by any of the
provisions of this Agreement to be submitted or furnished to Lender shall be in
form and substance reasonably satisfactory to Lender.
9.11.    Entire Agreement. This Agreement and the other Transaction Document
along with the Exhibits thereto constitute the entire agreement between the
parties hereto with respect to the subject matter hereof and may not be modified
or amended in any manner other than by supplemental written agreement executed
by the parties hereto. No party, in entering into this Agreement, has relied
upon any representation, warranty, covenant, condition or other term that is not
set forth in this Agreement or in the other Transaction Document.
9.12.    Choice of Law. This Agreement shall be governed by and construed in
accordance with the internal laws of The Commonwealth of Massachusetts. Nothing
herein shall be deemed

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to limit any rights, powers or privileges which Lender may have pursuant to any
law of the United States of America or The Commonwealth of Massachusetts or any
rule, regulation or order of any department or agency thereof and nothing herein
shall be deemed to make unlawful any transaction or conduct by Lender which is
lawful pursuant to, or which is permitted by, any of the foregoing.
9.13.    Legal Reimbursement. If any attorney is engaged by Lender to enforce or
defend any provision of this Agreement and the Subordinated Note, or as a
consequence of any Event of Default, with or without the filing of any legal
action or proceeding, then Borrower shall pay to Lender immediately upon demand
all reasonable attorneys’ fees and expenses, together with interest thereon from
the date of such demand until paid at the rate of interest applicable to the
principal balance owing hereunder as if such unpaid attorneys’ fees and expenses
had been added to the principal.
9.14.    No Third Party Beneficiary. This Agreement is made for the sole benefit
of Borrower and Lender, and no other person shall be deemed to have any privity
of contract hereunder nor any right to rely hereon to any extent or for any
purpose whatsoever, nor shall any other person have any right of action of any
kind hereon or be deemed to be a third party beneficiary hereunder.
9.15.    Legal Tender of United States. All payments hereunder shall be made in
coin or currency which at the time of payment is legal tender in the United
States of America for public and private debts.
9.16.    Captions; Counterparts. Captions contained in this Agreement in no way
define, limit or extend the scope or intent of their respective provisions. This
Agreement may be executed by facsimile and in any number of counterparts and by
different parties hereto in separate counterparts (including an email
transaction of an executed counterpart of this Agreement), each of which when so
executed and delivered shall be deemed to be an original and all of which taken
together shall constitute but one and the same instrument.
9.17.    Knowledge; Discretion. All references herein to Borrower’s Knowledge
shall be deemed to refer to the Knowledge of the directors and the Chief
Executive Officer and the Chief Financial Officer of Borrower and Bank. Unless
specified to the contrary herein, all references herein to an exercise of
discretion or judgment by Lender, to the making of a determination or
designation by Lender, to the application of Lender’s discretion or opinion, to
the granting or withholding of Lender’s consent or approval, to the
consideration of whether a matter or thing is satisfactory or acceptable to
Lender, or otherwise involving the decision making of Lender, shall be deemed to
mean that Lender shall decide using the reasonable discretion or judgment of a
prudent lender.
9.18.    Waiver Of Right To Jury Trial. TO THE EXTENT PERMITTED UNDER APPLICABLE
LAW, BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT
THAT IT MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING IN ANY WAY IN
CONNECTION WITH THIS AGREEMENT OR THE SUBORDINATED NOTE, OR ANY OTHER STATEMENTS
OR ACTIONS OF BORROWER OR LENDER. BORROWER ACKNOWLEDGES THAT IT HAS BEEN
REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS

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WAIVER BY INDEPENDENT LEGAL COUNSEL SELECTED OF ITS OWN FREE WILL. BORROWER
FURTHER ACKNOWLEDGES THAT (A) IT HAS READ AND UNDERSTANDS THE MEANING AND
RAMIFICATIONS OF THIS WAIVER, (B) THIS WAIVER HAS BEEN REVIEWED BY BORROWER AND
BORROWER’S COUNSEL AND IS A MATERIAL INDUCEMENT FOR LENDER TO ENTER INTO THIS
AGREEMENT AND THE OTHER TRANSACTION DOCUMENT AND (C) THIS WAIVER SHALL BE
EFFECTIVE AS TO EACH OF SUCH TRANSACTION DOCUMENTS AS IF FULLY INCORPORATED
THEREIN.

{Signatures appear on following page}

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IN WITNESS WHEREOF, the parties hereto have caused this Subordinated Note
Purchase Agreement to be executed under seal by their duly authorized
representatives as of the date first above written.

 
 
ENTERPRISE BANCORP, INC.
_________________________________
Witness
By:
/s/ John P. Clancy, Jr.
 
 
Name: John P. Clancy, Jr.
   Title: Chief Executive Officer
 
 
 

_________________________________
Witness
By:

_________________________________
Name:
   Title: