Exhibit 10.3

$20,000,000

MMCAPSSM

Lakeland Bancorp Capital Trust IV

PLACEMENT AGREEMENT

New York, New York

May 14, 2007

SANDLER O’NEILL & PARTNERS, L.P.

919 Third Avenue

6th Floor

New York, New York 10022

Ladies and Gentlemen:

Lakeland Bancorp Capital Trust IV (the “Trust”), a statutory trust organized
under the Delaware Statutory Trust Act, 12 Del. C. § 3801 et seq. (the “Delaware
Act”), and Lakeland Bancorp, Inc., a New Jersey corporation (the “Company” and
together with the Trust, the “Offerors”), confirm their agreement (the
“Agreement”) with Sandler O’Neill & Partners, L.P., as agent of the Offerors
(the “Placement Agent”), with respect to the issue and sale by the Trust and the
placement by the Placement Agent of 20,000 MMCapSSM (liquidation amount of
$1,000 per security) of the Trust having the terms described in Schedule A
hereto (the “Capital Securities”). The Capital Securities will be guaranteed by
the Company to the extent provided in the Guarantee Agreement, to be dated as of
the Closing Date (as defined in Section 2(a) hereof) (the “Guarantee
Agreement”), between the Company, as guarantor, and Wilmington Trust Company, as
guarantee trustee (the “Guarantee Trustee”), with respect to distributions and
payments upon liquidation, redemption and otherwise.

The entire proceeds from the sale of the Capital Securities will be combined
with the entire proceeds from the sale by the Trust to the Company of its common
securities (the “Common Securities”), and will be used by the Trust to purchase
the relevant portion of the $20,619,000 aggregate principal amount of
Fixed/Floating Rate Junior Subordinated Debt Securities due 2037 (the
“Subordinated Debt Securities”) issued by the Company. The Capital Securities
and the Common Securities will be issued pursuant to the Amended and Restated
Declaration of Trust, to be dated as of the Closing Date (the “Declaration”),
among the Company, as sponsor, the Administrators named therein (the
“Administrators”), Wilmington Trust Company, as institutional trustee (the
“Institutional Trustee”), Wilmington Trust Company, as Delaware trustee (the
“Delaware Trustee”), and the holders, from time to time, of undivided beneficial
interests in the assets of the Trust. The Subordinated Debt Securities will be
issued pursuant to the Indenture, to be dated as of the Closing Date (the
“Indenture”), between the Company and Wilmington Trust Company, as indenture
trustee (the “Indenture Trustee”). The Indenture, the Guarantee Agreement, the
Declaration, the DTC Agreement (as defined below), this Agreement and the
Subscription Agreement (as defined in Section 2(a) hereof) are hereinafter
referred to collectively as the “Operative Documents.”

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

On the Closing Date, the Capital Securities will be issued in book-entry only
form to Cede & Co. as nominee of The Depository Trust Company (“DTC”) pursuant
to a Letter of Representations, dated no later than the Closing Date (the “DTC
Agreement”), among the Trust and DTC and shall be designated as PORTAL
securities in accordance with the rules and regulations adopted by the National
Association of Securities Dealers, Inc. (the “NASD”) relating to trading in the
PORTAL market, unless the Placement Agent shall notify the Company in writing
otherwise on or prior to the Closing Date, in which case the Capital Securities
will be issued in definitive form in the manner specified pursuant to Section 2
hereof.

SECTION 1. Representations and Warranties.

(a) The Trust and the Company, jointly and severally, represent and warrant to
the Placement Agent and Citigroup Global Markets Inc. (or its designee) (the
“Purchaser”) as of the date hereof and as of the Closing Date, and agree with
the Placement Agent and the Purchaser, as follows:

(i) Similar Offerings. Within a period of six months before or after the date
hereof, the Offerors have not, directly or indirectly, solicited any offer to
buy or offered to sell, and will not, directly or indirectly, solicit any offer
to buy or offer to sell, in the United States or to any United States citizen or
resident, any security which is or would be integrated with the sale of the
Capital Securities (including any securities of the same or a similar class as
the Capital Securities) in a manner that would require the Capital Securities to
be registered under the Securities Act of 1933, as amended (the “1933 Act”).

(ii) Incorporated Documents. The documents of the Company filed with the
Securities and Exchange Commission (the “Commission”) in accordance with the
Securities Exchange Act of 1934, as amended (the “1934 Act”), from and including
the commencement of the fiscal year covered by the Company’s most recent Annual
Report on Form 10-K, at the time they were or hereafter are filed by the Company
with the Commission (collectively, the “1934 Act Reports”), complied and will
comply in all material respects with the requirements of the 1934 Act and the
rules and regulations of the Commission thereunder (the “1934 Act Regulations”),
and, at the date of this Agreement, on the Closing Date and on the
Representation and Delivery Date (as defined in Section 2(a) hereof), do not and
will not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; and other than such instruments, agreements, contracts and other
documents as are filed as exhibits to the Company’s Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q or Current Reports on Form 8-K, there are no
instruments, agreements, contracts or documents of a character described in
Item 601 of Regulation S-K promulgated by the Commission to which the Company or
any of its subsidiaries is a party.

(iii) Independent Accountants. The accountants of the Company who certified the
financial statements included in the 1934 Act Reports (the “Independent
Accountants”) are independent public accountants of the Company and its
subsidiaries within the meaning of the 1933 Act and the rules and regulations of
the Commission thereunder (the “1933 Act Regulations”).

 

2

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

(iv) Financial Statements and Information. The consolidated historical financial
statements of the Company, together with the related schedules and notes,
included in the 1934 Act Reports present fairly, in all material respects, the
respective consolidated financial positions of the Company and its consolidated
subsidiaries at the respective dates indicated, and the consolidated statements
of income, changes in stockholders’ equity and cash flows of the Company and its
consolidated subsidiaries for the respective periods specified; said financial
statements have been prepared in conformity with generally accepted accounting
principles in the United States applied on a consistent basis throughout the
periods involved, except as disclosed in the notes to such financial statements;
the supporting schedules, if any, included in the 1934 Act Reports present
fairly, in all material respects, the information required to be stated therein;
and any pro forma financial statements and the related notes thereto included in
the 1934 Act Reports present fairly, in all material respects, the information
shown therein, have been prepared in accordance with the Commission’s rules and
guidelines with respect to pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances referred to
therein.

(v) No Material Adverse Change. Since the respective dates as of which
information is given in the 1934 Act Reports, there has not been (A) any
material adverse change in the condition, financial, regulatory or otherwise, or
in the earnings, business affairs or business prospects of the Trust or of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business (a “Material Adverse Effect”) or
(B) any dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock other than regular quarterly dividends
on the Company’s common stock declared and paid consistent with past practice.

(vi) Internal Accounting Controls. Each of the Company and its subsidiaries
maintain a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with the
management’s general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset accountability,
(iii) access to assets is permitted only in accordance with the management’s
general or specific authorization and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.

(vii) Disclosure Controls. The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e)
under the 1934 Act); such disclosure controls and procedures (i) are designed to
ensure that material information relating to the Company, including its
consolidated subsidiaries, is made known to the Company’s Chief Executive
Officer and its Chief Financial Officer by others within those entities,
particularly during the periods in which the 1934 Act Reports are being
prepared, (ii) have been evaluated for effectiveness as of the end of the annual
or quarterly period reported to the Commission and (iii) are effective to
perform the functions for which they

 

3

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

were established; the Company’s auditors and the Audit Committee of the Board of
Directors have been advised of: (A) any significant deficiencies in the design
or operation of internal controls which could adversely affect the Company’s
ability to record, process, summarize, and report financial data and (B) any
fraud, whether or not material, that involves management or other employees who
have a role in the Company’s internal controls; any material weaknesses in
internal controls have been identified for the Company’s auditors; and since the
date of the most recent evaluation of such disclosure controls and procedures,
there have been no significant changes in internal controls or in other factors
that could significantly affect internal controls, including any corrective
actions with regard to significant deficiencies and material weaknesses.

(viii) Regulatory Matters. Neither the Company nor any of its subsidiaries is
subject or is party to, or has received any notice or advice that any of them
may become subject or party to any investigation with respect to, any
corrective, suspension or cease-and-desist order, agreement, consent agreement,
memorandum of understanding or other regulatory enforcement action, proceeding
or order with or by, or is a party to any commitment letter or similar
undertaking to, or is subject to any directive by, or has been a recipient of
any supervisory letter from, or has adopted any board resolutions at the request
of, any Regulatory Agency (as defined below) that currently relates to or
restricts in any material respect the conduct of their business or that in any
manner relates to their capital adequacy, credit policies, management or
business (each, a “Regulatory Agreement”), nor has the Company or any of its
subsidiaries been advised by any Regulatory Agency that it is considering
issuing or requesting any such Regulatory Agreement; there is no unresolved
violation, criticism or exception by any Regulatory Agency with respect to any
report or statement relating to any examinations of the Company or any of its
subsidiaries which, in the reasonable judgment of the Company, is expected to
result in a Material Adverse Effect. As used herein, the term “Regulatory
Agency” means any federal or state agency charged with the supervision or
regulation of depositary institutions or holding companies of depositary
institutions, or engaged in the insurance of depositary institution deposits, or
any court, administrative agency or commission or other governmental agency,
authority or instrumentality having supervisory or regulatory authority with
respect to the Company or any of its subsidiaries.

(ix) No Undisclosed Liabilities. Neither the Company nor any of its subsidiaries
has any material liability, whether known or unknown, whether asserted or
unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due, including
any liability for taxes (and there is no past or present fact, situation,
circumstance, condition or other basis for any present or future action, suit,
proceeding, hearing, charge, complaint, claim or demand against the Company or
its subsidiaries giving rise to any such liability), except (i) for liabilities
set forth in the financial statements referred to in Section 1(a)(iv) above and
(ii) normal fluctuations in the amount of the liabilities referred to in
clause (i) above occurring in the ordinary course of business of the Company and
all of its subsidiaries since the date of the most recent balance sheet included
in such financial statements.

(x) Good Standing of the Company. The Company has been duly organized and is
validly existing as a corporation in good standing under the laws of the State
of New Jersey and has full power and authority under such laws to own, lease and
operate its properties and to conduct its business, to enter into and perform
its obligations under each of the

 

4

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

Operative Documents to which it is a party, and to issue the Subordinated Debt
Securities; and the Company is duly registered as a bank holding company under
the Bank Holding Company Act of 1956, as amended.

(xi) Good Standing of the Subsidiaries. Each “significant subsidiary” (as
defined in Rule 1-02 of Regulation S-X) of the Company (a “Significant
Subsidiary”) has been duly organized and is validly existing as an entity in
good standing under the laws of the jurisdiction in which it is chartered and
has full power and authority under such laws to own, lease and operate its
properties and to conduct its current and contemplated business; and the deposit
accounts of each of the Company’s subsidiary banks are insured up to the
applicable limits by the Deposit Insurance Fund of the Federal Deposit Insurance
Corporation (the “FDIC”) to the fullest extent permitted by law and the rules
and regulations of the FDIC, and no proceeding for the revocation or termination
of such insurance is pending or, to the knowledge of the Company, threatened.

(xii) Foreign Qualifications. Each of the Company and its subsidiaries is duly
qualified as a foreign entity 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
the failure to be so qualified would not singularly, or in the aggregate, in the
reasonable judgment of the Company, be expected to result in a Material Adverse
Effect.

(xiii) Capital Stock Duly Authorized and Validly Issued. All of the issued and
outstanding capital stock of the Company has been duly authorized and validly
issued and is fully paid and nonassessable; all of the issued and outstanding
capital stock of each Significant Subsidiary of the Company has been duly
authorized and validly issued, is fully paid and nonassessable and is owned by
the Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equitable right; and
none of the issued and outstanding capital stock of the Company or its
Significant Subsidiaries was issued in violation of any preemptive or similar
rights arising by operation of law, under the charter, by-laws or code of
regulations of the Company or any of its Significant Subsidiaries or under any
agreement to which the Company or any of its Significant Subsidiaries is a
party.

(xiv) Good Standing of the Trust. The Trust has been duly created and is validly
existing in good standing as a statutory trust under the Delaware Act with the
power and authority to own property and to conduct its business as provided in
the Declaration, to enter into and perform its obligations under the Operative
Documents to which it is a party, and to issue the Capital Securities and the
Common Securities; the Trust is not a party to or otherwise bound by any
agreement other than the Operative Documents to which it is a party; and the
Trust is, and will be, under current law, classified for United States federal
income tax purposes as a grantor trust and not as an association taxable as a
corporation.

(xv) Authorization of Common Securities. The Common Securities have been duly
authorized for issuance by the Trust pursuant to the Declaration and, on the
Closing Date, when duly issued and executed in accordance with the Declaration
and delivered by the Trust to the Company against payment therefor in accordance
with the subscription agreement therefor, will be validly issued and fully paid
and nonassessable undivided common

 

5

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

beneficial ownership interests in the assets of the Trust; the issuance of the
Common Securities is not subject to preemptive or other similar rights; and on
the Closing Date, all of the issued and outstanding Common Securities of the
Trust will be owned directly by the Company, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equitable right.

(xvi) Authorization of Capital Securities. The Capital Securities have been duly
authorized for issuance by the Trust pursuant to the Declaration and, on the
Closing Date, when duly issued, executed, and authenticated in accordance with
the Declaration and delivered by the Trust against payment therefore as provided
herein and in accordance with the Subscription Agreement (as defined in
Section 2(a) hereof) and will be validly issued and fully paid and nonassessable
undivided preferred beneficial ownership interests in the assets of the Trust;
the issuance of the Capital Securities will not be subject to preemptive or
other similar rights; and the Capital Securities will be in the form
contemplated by, and entitled to the benefits of, the Declaration.

(xvii) Authorization of this Agreement. This Agreement has been duly authorized,
executed and delivered by each of the Offerors.

(xviii) Authorization of Subscription Agreement. The Subscription Agreement (as
defined in Section 2(a) hereof) has been duly authorized, executed and delivered
by each of the Offerors, and assuming due authorization, execution and delivery
of the Subscription Agreement by the Purchaser, the Subscription Agreement
constitutes a valid, legal and binding agreement of each of the Offerors,
enforceable against each of the Offerors in accordance with its terms, except to
the extent that enforceability may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws now or
hereafter in effect relating to creditors’ rights generally and (b) general
principles of equity (regardless of whether enforceability is considered in a
proceeding at law or in equity) (collectively, the “Enforceability Exceptions”).

(xix) Authorization of Declaration. The Declaration has been duly authorized by
the Company and, on the Closing Date, when duly executed and delivered by the
Company and the Administrators, and assuming due authorization, execution and
delivery of the Declaration by the Institutional Trustee and the Delaware
Trustee, the Declaration will constitute a valid, legal and binding agreement of
the Company, enforceable against the Company in accordance with its terms,
except to the extent that enforceability may be limited by the Enforceability
Exceptions.

(xx) Authorization of Guarantee Agreement. The Guarantee Agreement has been duly
authorized by the Company and, on the Closing Date, when duly executed and
delivered by the Company, and assuming due authorization, execution and delivery
of the Guarantee Agreement by the Guarantee Trustee, the Guarantee Agreement
will constitute a valid, legal and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except to the extent that
enforceability may be limited by the Enforceability Exceptions.

(xxi) Authorization of Indenture. The Indenture has been duly authorized by the
Company and, on the Closing Date, when duly executed and delivered by the

 

6

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

Company, and assuming due authorization, execution and delivery of the Indenture
by the Indenture Trustee, the Indenture will constitute a valid, legal and
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforceability may be limited by the
Enforceability Exceptions.

(xxii) Authorization of Subordinated Debt Securities. The Subordinated Debt
Securities have been duly authorized by the Company and, on the Closing Date,
when duly executed by the Company and, when authenticated in the manner provided
for in the Indenture and delivered by the Company to the Trust against payment
therefor as contemplated in the subscription agreement therefor, will constitute
valid, legal and binding obligations of the Company, enforceable against the
Company in accordance with their terms, except to the extent that enforceability
may be limited by the Enforceability Exceptions; the Subordinated Debt
Securities will be in the form contemplated by, and entitled to the benefits of,
the Indenture; the Subordinated Debt Securities constitute indebtedness of the
Company for United States federal income tax purposes and the Company has no
present intention to exercise its option to defer payments of interest on the
Subordinated Debt Securities as provided in the Indenture.

(xxiii) Authorization of the DTC Agreement. Unless the Placement Agent shall
have notified the Company in writing pursuant to Section 2 hereof that the
Capital Securities are not to be issued in book-entry form, the DTC Agreement
has been duly authorized by the Trust and, on the Closing Date, when duly
executed and delivered by the Trust, and assuming due receipt and acceptance of
the DTC Agreement by DTC, the DTC Agreement will constitute a valid, legal and
binding agreement of the Trust, enforceable against the Trust in accordance with
its terms, except to the extent that enforceability may be limited by the
Enforceability Exceptions.

(xxiv) Authorization of Administrators. Each of the Administrators of the Trust
is an officer or employee of the Company and has been duly authorized by the
Company to execute and deliver the Declaration.

(xxv) Not an Investment Company. Neither the Trust nor the Company is, and
immediately following consummation of the transactions contemplated hereby and
the application of the net proceeds therefrom neither the Trust nor the Company
will be, an “investment company” or an entity “controlled” by an “investment
company”, in each case within the meaning of Section 3(a) of the Investment
Company Act of 1940, as amended (the “1940 Act”), without regard to Section 3(c)
of the 1940 Act.

(xxvi) Absence of Defaults and Conflicts. The Trust is not in violation of the
trust certificate of the Trust filed with the State of Delaware (the “Trust
Certificate”) or the Declaration, and neither the Company nor any of its
subsidiaries is in violation of its charter, by-laws or code of regulations;
none of the Trust, the Company or any subsidiary of the Company is in default in
the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or instrument to which it is a
party or by which it or any of them may be bound or to which any of its
properties or assets is subject (collectively, “Agreements and Instruments”),
except for such defaults under Agreements and Instruments that, in the
reasonable judgment of the Company, are not expected to result in a Material
Adverse Effect; and the

 

7

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

execution, delivery and performance of the Operative Documents by the Trust or
the Company, as the case may be, the issuance, sale and delivery of the Capital
Securities and the Subordinated Debt Securities, the consummation of the
transactions contemplated by the Operative Documents, and compliance by the
Trust and the Company with the terms of the Operative Documents to which they
are a party have been duly authorized by all necessary corporate action on the
part of the Company and by all necessary action on the part of the Trust and do
not and will not, whether with or without the giving of notice or passage of
time or both, violate, conflict with or constitute a breach of, or default or
Repayment Event (as defined below) under, or result in the creation or
imposition of any, security interest, mortgage, pledge, lien, charge,
encumbrance, claim or equitable right upon any properties or assets of the Trust
or the Company or any of its subsidiaries pursuant to any of the Agreements and
Instruments, nor will such action result in any violation of the provisions of
the charter, by-laws or code of regulations of the Company or any of its
subsidiaries or the Declaration or the Trust Certificate, or violation by the
Company or any of its subsidiaries of any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government, government
authority, agency (including, without limitation, each applicable Regulatory
Agency) or instrumentality or court, domestic or foreign, having jurisdiction
over the Trust or the Company or any of its subsidiaries or their respective
properties or assets (collectively, “Governmental Entities”). As used herein, a
“Repayment Event” means any event or condition which gives the holder of any
note, debenture or other evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Trust or the Company or any of its
subsidiaries prior to its scheduled maturity.

(xxvii) Absence of Labor Dispute. No labor dispute with the employees of the
Company or any of its subsidiaries exists or, to the knowledge of the executive
officers of the Company, is imminent, which, in the reasonable judgment of the
Company, in either case, is expected to result in a Material Adverse Effect.

(xxviii) Absence of Proceedings. There is no action, suit, proceeding, inquiry
or investigation before or brought by any Governmental Entity, now pending, or,
to the knowledge of the Trust or the Company, threatened, against or affecting
the Trust or the Company or any of its subsidiaries, which, in the reasonable
judgment of the Trust or the Company is expected to result in a Material Adverse
Effect or materially and adversely affect the consummation of the transactions
contemplated by the Operative Documents or the performance by the Trust or the
Company of its obligations hereunder or thereunder; and the aggregate of all
pending legal or governmental proceedings to which the Trust or the Company or
any of its subsidiaries is a party or of which any of their respective
properties or assets is the subject, including ordinary routine litigation
incidental to the business, are not, in the reasonable judgment of the Company
or the Trust, expected to result in a Material Adverse Effect.

(xxix) Absence of Further Requirements. No filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any
Governmental Entity, other than those that have been made or obtained, is
necessary or required for the authorization, execution, delivery or performance
by the Trust or the Company of their respective obligations under the Operative
Documents, the Subordinated Debt Securities or the Capital Securities, as
applicable, or the consummation by the Trust or the Company of the transactions
contemplated by the Operative Documents.

 

8

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

(xxx) Possession of Licenses and Permits. Each of the Trust, the Company and the
subsidiaries of the Company possesses such permits, orders, certificates,
licenses, approvals, consents and other authorizations (collectively,
“Governmental Licenses”) issued by the appropriate Governmental Entities
necessary to conduct the business now operated by it that is material to the
Trust or the Company and its subsidiaries considered as one enterprise; each of
the Trust, the Company and the subsidiaries of the Company is in compliance with
the terms and conditions of all of its Governmental Licenses, except where the
failure so to comply, in the reasonable judgment of the Company, is not expected
to, singularly or in the aggregate, have a Material Adverse Effect; 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, in the reasonable judgment of the
Company, is not expected to have a Material Adverse Effect; and none of the
Trust, the Company or any subsidiary of the Company has received notice of any
proceeding, and to the knowledge of the Trust, the Company or any subsidiary of
the Company, there has been no threatened proceeding, relating to the
revocation, termination, suspension or modification of any such Governmental
Licenses which, singularly or in the aggregate, in the reasonable judgment of
the Company or the Trust, is expected to result in a Material Adverse Effect.

(xxxi) Title to Property. Each of the Trust, the Company and the subsidiaries of
the Company has good and marketable title to all of its respective real and
personal properties, in each case free and clear of all liens, encumbrances and
defects, except such as, in the reasonable judgment of the Trust or the Company,
singularly or in the aggregate, are not expected to result in a Material Adverse
Effect; and all of the leases and subleases under which the Trust, the Company
or any subsidiary of the Company holds properties are in full force and effect,
except when the failure of such leases and subleases to be in full force and
effect, in the reasonable judgment of the Company, singularly or in the
aggregate, is not expected to have a Material Adverse Effect, and none of the
Trust, the Company or any subsidiary of the Company has any notice of any claim
of any sort that has been asserted by anyone adverse to the rights of the Trust,
the Company or any subsidiary of the Company under any of the leases or
subleases under which the Trust, the Company or any subsidiary of the Company
holds properties, or affecting or questioning the rights of such entity to the
continued possession of the leased or subleased premises under any such lease or
sublease, except when such claim, in the reasonable judgment of the Company,
singularly or in the aggregate, is not expected to have a Material Adverse
Effect.

(xxxii) Stabilization. The Company has not taken and will not take, directly or
indirectly, any action designed to, or that might be reasonably expected to,
cause or result in stabilization or manipulation of the price of the Capital
Securities.

(xxxiii) No General Solicitation. Neither the Trust or the Company nor any of
their Affiliates (as defined in Rule 501(b) under the 1933 Act) or any person
acting on its or any of their behalf (other than the Placement Agent, as to whom
the Offerors make no representation) has engaged or will engage, in connection
with the offer and sale of the Capital Securities, in any form of general
solicitation or general advertising within the meaning of Rule 502(c) under the
1933 Act.

 

9

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

(xxxiv) No Directed Selling Efforts. Neither the Trust or the Company nor any of
their Affiliates or any person acting on its or any of their behalf (other than
the Placement Agent, as to whom the Offerors make no representation) has engaged
or will engage in any directed selling efforts within the meaning of
Regulation S under the 1933 Act (“Regulation S”) with respect to the offer and
sale of the Capital Securities.

(xxxv) No Registration. Subject to compliance by the Placement Agent with the
relevant provisions of Section 6 hereof, it is not necessary in connection with
the offer, sale and delivery of the Capital Securities by the Trust and the
subsequent sale of the Capital Securities by the Purchaser to its Transferees
(as defined in Section 2(a) hereof), in each case, in the manner contemplated by
this Agreement to register the Capital Securities, the guarantee as described in
the Guarantee Agreement or the Subordinated Debt Securities under the 1933 Act
or to qualify the Declaration, the Guarantee Agreement or the Indenture under
the Trust Indenture Act of 1939, as amended.

(b) Any certificate signed by any Trustee of the Trust or any duly authorized
officer of the Company or any of its subsidiaries and delivered to the Placement
Agent or to counsel for the Placement Agent shall be deemed a representation and
warranty by the Trust or the Company, as the case may be, to the Placement Agent
as to the matters covered thereby.

SECTION 2. Purchase and Sale; Closing.

(a) The Offerors hereby agree to issue and sell the Capital Securities on
May 16, 2007 (or such other date mutually agreed to by the Offerors and the
Placement Agent) (the “Closing Date”) to the Purchaser pursuant to the terms of
the Capital Securities Subscription Agreement, entered into on the date hereof
(the “Subscription Agreement”), between the Offerors and the Purchaser. It is
understood and agreed that the Purchaser intends to, and may, transfer the
Capital Securities to any other purchaser(s) (individually, a “Transferee” and
collectively, the “Transferees”) in accordance with the provisions contained in
the Declaration and subject to Section 6 hereof. The date on which the Purchaser
has transferred all of the Capital Securities purchased on the Closing Date is
referred to herein as the “Representation and Delivery Date”. In addition, the
Offerors agree that each Transferee shall be entitled to the benefit of, and to
rely on, the provisions of this Agreement as if such Transferee was party
hereto.

(b) The Offerors hereby grant to the Placement Agent the exclusive right to
arrange the placement of the Capital Securities with the Purchaser on their
behalf. The Placement Agent accepts such right and agrees to use its best
efforts, on and prior to the Closing Date, to effect such placement.

(c) On the Closing Date, the Capital Securities shall be represented by a single
global certificate that is registered in the name of Cede & Co., as nominee of
DTC, pursuant to the DTC Agreement unless the Placement Agent shall notify the
Company in writing on or prior to the Closing Date that the Capital Securities
shall be issued in definitive form, in which case such Capital Securities shall
be registered in the name(s) and denomination(s) specified by the Placement
Agent. Delivery of the global certificate(s) representing the Capital Securities
shall be made by the Trust to or on behalf of the Purchaser at the offices of
Sidley

 

10

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

Austin LLP in The City of New York, and payment of the purchase price for the
Capital Securities shall be made by the Purchaser to the Trust by wire transfer
of immediately available funds to a bank designated by the Company
contemporaneous with closing on the Closing Date.

(d) As compensation to the Placement Agent for its placement of the Capital
Securities and in view of the fact that the proceeds of the sale of the Capital
Securities will be used to purchase the Subordinated Debt Securities of the
Company, the Company hereby agrees to pay on the Closing Date to the Placement
Agent in immediately available funds a commission of $0.00 per Capital Security
to be delivered by the Trust hereunder on the Closing Date.

(e) In performing its duties under this Agreement, the Placement Agent shall be
entitled to rely upon any notice, signature or writing which the Placement Agent
shall in good faith believe to be genuine and to be signed or presented by a
proper party or parties. The Placement Agent may rely upon any opinions or
certificates or other documents delivered by the Offerors or their counsel or
designees either to it or the Purchaser. In addition, in connection with the
performance of its duties under this Agreement, the Placement Agent shall not be
liable for any error of judgment or any action taken or omitted to be taken
unless it was grossly negligent or engaged in willful misconduct in connection
with such performance or non-performance. No provision of this Agreement shall
require the Placement Agent to expend or risk its own funds or otherwise incur
any financial liability on behalf of the Purchaser in connection with the
performance of any of its duties hereunder. The Placement Agent shall be under
no obligation to exercise any of the rights or powers vested in it by this
Agreement.

SECTION 3. Notice of Material Events. The Offerors covenant with the Placement
Agent and the Purchaser that, prior to the Representation and Delivery Date, the
Offerors will immediately notify the Placement Agent, and confirm such notice in
writing, of any event or development that, in the reasonable judgment of the
Company, is expected to result in a Material Adverse Effect.

SECTION 4. Payment of Expenses. Whether or not this Agreement or the
Subscription Agreement is terminated or the sale of the Capital Securities is
consummated, the Company, as borrower under the Subordinated Debt Securities,
will pay all expenses incident to the performance of its obligations under this
Agreement, including (i) the preparation, issuance and delivery of the
certificates for the Capital Securities and Subordinated Debt Securities,
(ii) the fees and disbursements of the Company’s counsel, accountants and other
advisors and (iii) the fees and disbursements of any registrar for the Capital
Securities, as well as the expenses and listing fees incurred in connection with
the clearance, settlement and trading of the Capital Securities through DTC and
the initial and continued designation of the Capital Securities as PORTAL
securities in accordance with the NASD’s rules and regulations relating to
trading in the PORTAL market. Notwithstanding the foregoing, the fees and
disbursements of any trustee appointed under any of the Operative Documents and
its counsel shall be paid as specified in the fee agreement between the Company
and Wilmington Trust Company.

SECTION 5. Conditions of Placement Agent’s Obligations. The obligations of the
Placement Agent and the Purchaser on the Closing Date are subject to the
accuracy of the representations and warranties of the Offerors contained in
Section 1 hereof or in certificates of any Administrator of the Trust or any
officer of the Company or any of its subsidiaries delivered pursuant to the
provisions hereof, to the performance by the Offerors of their obligations
hereunder, and to the following further conditions:

(a) Opinion of Counsel for the Offerors. On the Closing Date, the Placement
Agent and the Purchaser shall have received the favorable opinion, dated as of
the Closing Date, of Lowenstein Sandler PC, special counsel for the Offerors, in
substantially the form set out in Annex A hereto, in form and substance
reasonably satisfactory to counsel for the Placement Agent. Such counsel may
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of Administrators of the
Trust, officers of the Company or any of its subsidiaries and public officials.

 

11

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

(b) Opinion of Special Delaware Counsel for the Trust. On the Closing Date, the
Placement Agent and the Purchaser shall have received the favorable opinion,
dated as of the Closing Date, of Morris James LLP, special Delaware counsel for
the Trust, in substantially the form set out in Annex B hereto, in form and
substance reasonably satisfactory to counsel for the Placement Agent.

(c) Opinion of Special Tax Counsel for the Offerors. On the Closing Date, the
Placement Agent and the Purchaser shall have received an opinion, dated as of
the Closing Date, of Lowenstein Sandler PC, special tax counsel for the
Offerors, that (i) the Trust will be classified for United States federal income
tax purposes as a grantor trust and not as an association taxable as a
corporation and (ii) the Subordinated Debt Securities will constitute
indebtedness of the Company for United States federal income tax purposes, in
substantially the form set out in Annex C hereto. Such opinion may be
conditioned on, among other things, the initial and continuing accuracy of the
facts, financial and other information, covenants and representations set forth
in certificates of officers of the Company and other documents deemed necessary
for such opinion.

(d) Opinion of Counsel to the Guarantee Trustee, the Institutional Trustee, the
Delaware Trustee and the Indenture Trustee. On the Closing Date, the Placement
Agent and the Purchaser shall have received the favorable opinion, dated as of
the Closing Date, of Morris James LLP, counsel for the Guarantee Trustee, the
Institutional Trustee, the Delaware Trustee and the Indenture Trustee, in
substantially the form set out in Annex D hereto, in form and substance
reasonably satisfactory to counsel for the Placement Agent.

(e) Certificates. On the Closing Date, there shall not have been, since the date
hereof or since the respective dates as of which information is given in the
1934 Act Reports, any Material Adverse Effect, and the Placement Agent and the
Purchaser shall have received a certificate of the Chairman, the Chief Executive
Officer, the President, any Executive Vice President or any Vice President of
the Company and of the Chief Financial Officer or Chief Accounting Officer of
the Company and a certificate of an Administrator of the Trust, dated as of the
Closing Date, to the effect that (i) there has been no such Material Adverse
Effect, (ii) the representations and warranties in Section 1 hereof were true
and correct when made and are true and correct with the same force and effect as
though expressly made on and as of the Closing Date, and (iii) the Offerors have
complied with all agreements and satisfied all conditions on their part to be
performed or satisfied on or prior to the Closing Date.

 

12

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

(f) Maintenance of Ratings. From the date of this Agreement through the Closing
Date, there shall not have occurred a downgrading in or withdrawal of the rating
assigned to any debt securities or preferred stock of the Company or any of its
subsidiaries by any “nationally recognized statistical rating organization,” as
that term is defined by the Commission for the purposes of Rule 436(g)(2) under
the 1933 Act, and no such organization shall have publicly announced that it has
under surveillance or review its rating of any debt securities or preferred
stock of the Company or any of its subsidiaries.

(g) Additional Documents. On the Closing Date, (i) the Trust and DTC shall have
executed the DTC Agreement relating to the Capital Securities and the Capital
Securities shall be eligible for clearance, settlement and trading through DTC
and designated as PORTAL securities in accordance with the NASD’s rules and
regulations relating to trading in the PORTAL market, unless the Placement Agent
shall have notified the Company in writing otherwise on or prior to the Closing
Date; in which event this Section 5(g)(i) shall not be a condition of the
Placement Agent’s obligations hereunder, and (ii) the Placement Agent and the
Purchaser shall have been furnished such documents and opinions as they may
reasonably request in connection with the issue, sale and placement of the
Capital Securities; and all proceedings taken by the Offerors in connection with
the issuance, sale and placement of the Capital Securities shall be satisfactory
in form and substance to the Placement Agent and the Purchaser.

(h) Termination of Agreement. If any condition specified in this Section shall
not have been fulfilled when and as required to be fulfilled, this Agreement may
be terminated by the Placement Agent as to its obligations hereunder by notice
to the Offerors at any time on or prior to the Closing Date. If the sale of the
Capital Securities to the Purchaser is not consummated because any condition set
forth in Section 5(a), (b), (c), (d), (e), (f) or (g) is not satisfied, because
of any termination pursuant to Section 10(a) hereof or because of any refusal,
inability or failure on the part of the Offerors to perform any agreement herein
or comply with any provision hereof, the Company will reimburse the Placement
Agent upon demand for all documented out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by
the Placement Agent in connection with the proposed sale. In addition, such
termination shall be subject to Section 4 hereof, and Sections 7 and 8 hereof
shall survive any such termination and remain in full force and effect.

SECTION 6. Offers and Sales of the Capital Securities.

(a) Offer and Sale Procedures. The Placement Agent and the Offerors hereby
establish and agree to observe the following provisions with respect to the
offer, issue, sale and transfer of the Capital Securities:

(i) Offers and Sales only to the Purchaser. Offers and sales of the Capital
Securities will be made only to the Purchaser in a transaction not requiring
registration under the 1933 Act.

(ii) No General Solicitation. No general solicitation or general advertising
(within the meaning of Rule 502(c) under the 1933 Act) has been or will be used
in connection with the offer and sale of the Capital Securities.

 

13

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

(iii) No Directed Selling Efforts. No directed selling efforts (within the
meaning of Regulation S) have been or will be used with respect to the offer and
sale of the Capital Securities.

(iv) Purchaser Notification. Prior to or contemporaneously with the purchase of
the Capital Securities by the Purchaser, the Placement Agent will take
reasonable steps to inform the Purchaser that the Capital Securities (A) have
not been and will not be registered under the 1933 Act, (B) are being sold to
them without registration under the 1933 Act in accordance with an exemption
from, or in a transaction not subject to, the registration requirements of the
1933 Act and (C) may not be offered, sold or otherwise transferred except in
accordance with the legend set forth in Annex E hereto.

(b) Covenants of the Offerors. Each of the Offerors, jointly and severally,
covenant with the Placement Agent and the Purchaser as follows:

(i) Due Diligence. In connection with the initial purchase of the Capital
Securities, the Offerors agree that, prior to the Representation and Delivery
Date, the Placement Agent and the Purchaser shall have the right to make
reasonable inquiries into the business of the Trust, the Company and the
subsidiaries of the Company. The Offerors also agree to provide answers to the
Placement Agent and the Purchaser, if requested, concerning the Trust, the
Company and the subsidiaries of the Company (to the extent that such information
is available or can be acquired and made available without unreasonable effort
or expense and to the extent the provision thereof is not prohibited by
applicable law) and the terms and conditions of the offering of the Capital
Securities and the Subordinated Debt Securities.

(ii) Integration. The Offerors agree that they will not, and will cause their
Affiliates not to, make any offer or sale of securities of the Offerors of any
class if, as a result of the doctrine of “integration” referred to in Rule 502
under the 1933 Act, such offer or sale would render invalid the exemption from
the registration requirements of the 1933 Act provided by Section 4(2) thereof
or by Rule 144A or otherwise.

(iii) Restriction on Repurchases. Until the expiration of two (2) years (or such
shorter period as may hereafter be referred to in Rule 144(k) (or similar
successor rule)) after the original issuance of the Capital Securities, the
Offerors will not, and will cause their Affiliates not to, purchase or agree to
purchase or otherwise acquire any Capital Securities which are “restricted
securities” (as such term is defined under Rule 144(a)(3) under the 1933 Act),
whether as beneficial owner or otherwise, unless, immediately upon any such
purchase, the Offerors or any Affiliate shall submit such Capital Securities to
the Institutional Trustee for cancellation.

(iv) PORTAL Eligible. The Offerors will cooperate with the Placement Agent and
the Purchaser and use their best efforts to designate the Capital Securities as
PORTAL securities in accordance with the NASD’s rules and regulations relating
to trading in the PORTAL market.

 

14

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

(v) DTC. The Offerors will cooperate with the Placement Agent and the Purchaser
and use their best efforts to permit the Capital Securities to be eligible for
clearance, settlement and trading through the facilities of DTC.

SECTION 7. Indemnification.

(a) Indemnification of the Placement Agent and the Purchaser. Each of the
Offerors agree, jointly and severally, to indemnify and hold harmless: (x) the
Placement Agent, and the Purchaser, (y) each person, if any, who controls
(within the meaning of Section 15 of the 1933 Act or Section 20 of the
Securities and Exchange Act of 1934, as amended (the 1934 Act”)) the Placement
Agent or the Purchaser (each such person, a “controlling person”) and (z) the
respective partners, directors, officers, employees and agents of the Placement
Agent and the Purchaser or any such controlling person, as follows:

(i) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, relating to or arising out of, or based upon, in whole or in part,
(A) any untrue statement or alleged untrue statement of a material fact included
in the 1934 Act Reports, or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; (B) any untrue
statement or alleged untrue statement of material fact contained in any
information (whether written or oral) or documents executed in favor of or
furnished or made available to the Placement Agent or the Purchaser by the
Offerors; (C) any omission or alleged omission to state in any information
(whether written or oral) or documents executed in favor of or furnished or made
available to the Placement Agent or the Purchaser by the Offerors a material
fact necessary to make the statements therein not misleading; or (D) the breach
or alleged breach of any representation, warranty and agreement of any Offeror
contained herein or in the Subscription Agreement;

(ii) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, to the extent of the aggregate amount paid in settlement of any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or of any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or omission,
or breach or alleged breach of any such representation, warranty or agreement;
provided, that (subject to Section 7(c) hereof) any such settlement is effected
with the written consent of the Offerors; and

(iii) against any and all expense whatsoever, as incurred (including the fees
and disbursements of counsel chosen by the Placement Agent), reasonably incurred
in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, or breach or alleged
breach of any such representation, warranty or agreement, to the extent that any
such expense is not paid under (i) or (ii) above;

 

15

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

provided, however, that the Company agrees to indemnify and hold harmless the
Trust against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, which is due from the Trust pursuant to the foregoing.

(b) Actions against Parties; Notification. Each indemnified party shall give
notice as promptly as reasonably practicable to each indemnifying party of any
action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof, and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. Counsel to the indemnified parties shall be selected by the Placement
Agent. An indemnifying party may participate at its own expense in the defense
of any such action; provided, however, that counsel to the indemnifying party
shall not (except with the consent of the indemnified party) also be counsel to
the indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 7 or Section 8 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent
(i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.

(c) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have validly requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 7(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement, provided, however, that an indemnifying party shall
not be liable for any such settlement effected without its consent if such
indemnifying party (1) reimburses such indemnified party with respect to those
fees and expenses of counsel that it determines in good faith are reasonable and
(2) provides written notice within 10 days after receipt of the request for
reimbursement to the indemnified party substantiating the unpaid balance as
unreasonable, in each case prior to the date of such settlement.

SECTION 8. Contribution. In order to provide for just and equitable contribution
in circumstances under which the indemnification provided for in Section 7
hereof is for any reason held to be unenforceable for the benefit of an
indemnified party in respect of

 

16

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

any losses, liabilities, claims, damages or expenses referred to therein, then
each indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as
incurred, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Offerors, on the one hand, and the Placement Agent, on
the other hand, from the offer and sale of the Capital Securities pursuant to
this Agreement or (ii) if the allocation provided by clause (i) is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Offerors, on the one hand, and the Placement Agent, on the other hand, in
connection with the statements, omissions or breaches which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.

The relative benefits received by the Offerors, on the one hand, and the
Placement Agent, on the other hand, in connection with the offer and sale of the
Capital Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offer and sale of the
Capital Securities pursuant to this Agreement (before deducting expenses)
received by the Offerors and the total commissions received by the Placement
Agent bear to the aggregate of such net proceeds and commissions.

The Offerors and the Placement Agent agree that it would not be just and
equitable if contribution pursuant to this Section 8 were determined by pro rata
or per capita allocation or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
Section 8. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this
Section 8 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement, omission or alleged omission or breach
or alleged breach.

Notwithstanding the provisions of this Section 8, the Placement Agent shall not
be required to contribute any amount in excess of the total commissions received
by it.

No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.

For purposes of this Section 8, the Purchaser, each person, if any, who controls
the Placement Agent or the Purchaser within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act and the respective partners, directors,
officers, employees and agents of the Placement Agent, the Purchaser or any such
controlling person shall have the same rights to contribution as the Placement
Agent, while each officer and director of the Company, each Trustee of the Trust
and each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Offerors.

 

17

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

SECTION 9. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or Trustees of the Trust submitted
pursuant hereto shall remain operative and in full force and effect, and shall
survive delivery of the Capital Securities by the Trust.

SECTION 10. Termination of Agreement.

(a) Termination; General. The Placement Agent may terminate this Agreement, by
notice to the Offerors, at any time on or prior to the Closing Date if, since
the time of execution of this Agreement or, in the case of (i), since the
respective dates as of which information is given in the 1934 Act Reports,
(i) there has occurred any Material Adverse Effect, or (ii) there has occurred
any material adverse change in the financial markets in the United States, any
outbreak of hostilities or escalation thereof or any other calamity or crisis,
or any change or development involving political, financial or economic
conditions, in each case the effect of which is such as to make it, in the
judgment of the Placement Agent, impracticable to market the Capital Securities
or to enforce contracts for the sale of the Capital Securities, or (iii) trading
in any securities of the Company has been suspended or limited by the Commission
or any national stock exchange or market on or in which such securities are
traded or quoted, or if trading generally on the American Stock Exchange, the
New York Stock Exchange or the Nasdaq National Market has been suspended or
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers or
any other governmental authority, or (iv) a banking moratorium has been declared
by United States federal, Delaware, New Jersey or New York authorities.

(b) Liabilities. If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except as
provided in Section 4 and Section 5 hereof, and provided further that
Sections 1, 7 and 8 hereof shall survive such termination and remain in full
force and effect.

SECTION 11. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Placement Agent shall be
directed to Sandler O’Neill & Partners, L.P., as follows: 919 Third Avenue, 6th
Floor, New York, New York 10022, Attention: Thomas W. Killian, Principal, with a
copy to Sidley Austin LLP, 787 Seventh Avenue, New York, New York 10019,
Attention: Edward F. Petrosky; and notices to the Offerors shall be directed to
Lakeland Bancorp, Inc., 250 Oak Ridge Road, Oak Ridge, New Jersey 07438,
Attention: Joseph F. Hurley, with a copy to Lowenstein Sandler PC, 65 Livingston
Avenue, Roseland, New Jersey 07068, Attention: Peter H. Ehrenberg.

SECTION 12. Parties. This Agreement shall inure to the benefit of and be binding
upon each of the Placement Agent, the Purchaser and the Offerors and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Placement Agent, the Purchaser, its Transferees and the Offerors, and
their respective successors and the controlling persons and other persons
referred to in Sections 1, 7 and 8 hereof and their heirs and legal
representatives,

 

18

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

any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement and all conditions
and provisions hereof are intended to be for the sole and exclusive benefit of
the Placement Agent, the Purchaser, its Transferees and the Offerors and their
respective successors, and said controlling persons and other persons and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation.

SECTION 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT
OF LAWS PRINCIPLES OF SAID STATE OTHER THAN SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW.

EACH OF THE TRUST AND THE COMPANY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE FEDERAL AND NEW YORK STATE COURTS LOCATED IN THE CITY OF NEW
YORK IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING RELATED TO THIS AGREEMENT
OR ANY OF THE MATTERS CONTEMPLATED HEREBY, IRREVOCABLY WAIVES ANY DEFENSE OF
LACK OF PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT
OF ANY SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT.
EACH OF THE TRUST AND THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT
MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

SECTION 14. Disclosure of Tax Treatment and Tax Structure. Notwithstanding
anything herein to the contrary, any party to this Agreement (and each employee,
representative or other agent of any party to this Agreement) may disclose to
any and all persons, without limitation of any kind, the tax treatment and tax
structure of the offering and all materials of any kind (including opinions or
other tax analyses) that are provided to it relating to such tax treatment and
tax structure. However, such information relating to the tax treatment or tax
structure is required to be kept confidential to the extent necessary to comply
with any applicable federal or state securities laws. For this purpose, “tax
structure” means any facts relevant to the federal income tax treatment of the
offering contemplated by this Agreement but does not include information
relating to the identity of the Offerors.

SECTION 15. Effect of Headings. The Section headings herein are for convenience
only and shall not affect the construction hereof.

 

19

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

If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Placement Agent and the Offerors in accordance with its terms.

 

Very truly yours, LAKELAND BANCORP, INC. By:  

/s/ Authorized Signatory

Name:   Title:   LAKELAND BANCORP CAPITAL TRUST IV By:  

/s/ Roger Bosma

  Roger Bosma   Administrator

 

CONFIRMED AND ACCEPTED,

as of the date first above written:

SANDLER O’NEILL & PARTNERS, L.P. By:  

Sandler O’Neill & Partners Corp.,

the sole general partner

  By:  

/s/ Authorized Signatory

    An Officer of the Corporation

 

Sch. A-1

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

SCHEDULE A

Pricing Terms

Lakeland Bancorp, Inc.

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

Pricing Date    May 14, 2007 Closing Date/Accrual Date    May 16, 2007 Issuance
Amount    $20 Million Type of Security    5 year Fixed/Float Spread/Coupon    3
Month LIBOR + 152 bps Initial Coupon    6.61% Payment Dates    The first day of
each February, May, August and November First Interest Payment Date    August 1,
2007 First Optional Call Date    August 1, 2012 at par Maturity Date    August
1, 2037 Day Count    Fixed term is 30/360 & Floater is Actual/360 Placement Fee
   None Expense Reimbursement    $10,000 Trustee Fees    Purchaser responsible
for Initial set-up fee and Annual Administration Fee for the trust per the Fee
Agreement

Special Redemption Schedule

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

 

Special Redemption Price will be 103.30

until August 1, 2008 and thereafter will be

as follows for the 12 month period

beginning August 1,

  

Percentage of Principal Amount

2008    102.64% 2009    101.98% 2010    101.32% 2011    100.66% 2012 and
Thereafter    100.00%

 

Sch. A-1

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

ANNEX A

Pursuant to Section 5(a) of the Placement Agreement, special counsel for the
Offerors shall deliver an opinion in substantially the following form:

1. The Company is incorporated and is validly existing as a corporation in good
standing under the laws of the State of New Jersey.

2. The Company has corporate power and authority to (i) execute and deliver, and
to perform its obligations under, the Operative Documents to which it is a party
and (ii) issue and perform its obligations under the Subordinated Debt
Securities.

3. The Company is registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended.

4. (i) Each Significant Subsidiary is validly existing and in good standing
under the laws of the jurisdiction of its organization; and (ii) to the best of
our knowledge, all of the issued and outstanding shares of capital stock of each
Significant Subsidiary are owned of record by the Company, directly or through
other subsidiaries.

5. The deposit accounts of each of the bank subsidiary of the Company are
insured by the Federal Deposit Insurance Corporation up to the maximum amount
allowable under applicable law and, to the best of our knowledge, no proceeding
for the termination of such insurance is pending or threatened.

6. Each of the Company and its subsidiaries (i) is duly qualified to do business
as a foreign corporation and is in good standing under the laws of each
jurisdiction which requires such qualification wherein it owns or leases
properties or conducts business and (ii) holds all approvals, authorizations,
orders, licenses, certificates and permits from governmental authorities
necessary for the conduct of its business, except where the failure to be so
qualified or to hold such approvals, authorizations, orders, licenses,
certificates and/or permits would not, singularly or in the aggregate, have a
Material Adverse Effect.

7. No consent, approval, authorization or order of or filing, registration or
qualification with any Governmental Entity is required under any law or
regulation of the United States or the states in which the Company and any bank
subsidiary of the Company is organized in connection with the authorization,
execution, delivery and performance by the Company of the Operative Documents or
the Subordinated Debt Securities and the consummation of the transactions
contemplated thereby except as have already been obtained or made.

8. Each of the Placement Agreement and the Subscription Agreement has been duly
authorized, executed and delivered by the Company and, assuming due
authorization, execution and delivery thereof by the Placement Agent and the
Purchaser, respectively, constitutes a valid and binding instrument of the
Company, enforceable against the Company in accordance with its terms, except as
rights to indemnity and contribution thereunder may be limited under applicable
law or public policy, and subject to the qualifications that (i) enforcement
thereof may be limited by bankruptcy, insolvency, receivership, reorganization,
liquidation, voidable preference, moratorium or other laws (including the laws
of fraudulent

 

A-1

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

conveyance and transfer) or judicial decisions affecting the enforcement of
creditors’ rights generally or the reorganization of financial institutions and
(ii) the enforceability of the obligations of the Company thereunder is subject
to general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and to the effect of certain
laws and judicial decisions upon the availability and enforceability of certain
remedies, including the remedies of specific performance and self-help.

9. The Declaration has been duly authorized, executed and delivered by the
Company and the Administrators.

10. Each of the Guarantee Agreement and the Indenture has been duly authorized,
executed, and delivered by the Company and, assuming due authorization,
execution and delivery by the Guarantee Trustee and the Indenture Trustee,
respectively, constitutes a valid and binding instrument of the Company,
enforceable against the Company in accordance with its terms, except as rights
to indemnity and contribution thereunder may be limited under applicable law or
public policy, and subject to the qualifications that (i) enforcement thereof
may be limited by bankruptcy, insolvency, receivership, reorganization,
liquidation, voidable preference, moratorium or other laws (including the laws
of fraudulent conveyance and transfer) or judicial decisions affecting the
enforcement of creditors’ rights generally or the reorganization of financial
institutions and (ii) the enforceability of the Company’s obligations thereunder
is subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and to the
effect of certain laws and judicial decisions upon the availability and
enforceability of certain remedies, including the remedies of specific
performance and self-help.

11. The Subordinated Debt Securities have been duly authorized, executed,
authenticated and delivered in accordance with the Indenture and constitute
valid and binding obligations of the Company and entitle the holders thereof to
the benefits of the Indenture, enforceable against the Company in accordance
with their terms, except as rights to indemnity and contribution thereunder may
be limited under applicable law or public policy, and subject to the
qualifications that (i) enforcement thereof may be limited by bankruptcy,
insolvency, receivership, reorganization, liquidation, voidable preference,
moratorium or other laws (including the laws of fraudulent conveyance and
transfer) or judicial decisions affecting the enforcement of creditors’ rights
generally or the reorganization of financial institutions and (ii) the
enforceability of the Company’s obligations thereunder is subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law) and to the effect of certain laws and judicial
decisions upon the availability and enforceability of certain remedies,
including the remedies of specific performance and self-help.

12. The execution, delivery and performance of the Operative Documents, the
Subordinated Debt Securities and the Capital Securities, as applicable, by the
Company and the Trust and the consummation by the Company and the Trust of the
transactions contemplated by the Operative Documents, as applicable, will not
result in any violation of the charter or bylaws of the Company or any
subsidiary of the Company, the Declaration, the Trust Certificate, the terms of
any indenture or other agreement or instrument known to such counsel and to
which the Company or any of its subsidiaries is a party or bound or any
judgment, order or decree of any Governmental Entity having jurisdiction over
the Company or any of its subsidiaries, or any law or administrative regulation
of any state applicable to the Company or any of the subsidiaries.

 

A-2

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

13. Assuming (i) the accuracy of the representations and warranties, and
compliance with the agreements, contained in the Placement Agreement and the
Subscription Agreement and (ii) that the Capital Securities are sold in the
manner contemplated by, and in accordance with, the Placement Agreement, the
Subscription Agreement and the Declaration, it is not necessary in connection
with the offer, sale and delivery of the Capital Securities by the Trust to the
Purchaser and by the Purchaser to its Transferees to register the Capital
Securities, the Guarantee Agreement or the Subordinated Debt Securities under
the 1933 Act or to qualify an indenture under the Trust Indenture Act of 1939,
as amended.

14. Neither the Company nor the Trust is, and, following the issuance of the
Capital Securities and the consummation of the transactions contemplated by the
Operative Documents and the application of the proceeds therefrom, neither the
Company nor the Trust will be, an “investment company” or entity “controlled” by
an “investment company”, in each case within the meaning of Section 3(a) of the
1940 Act, without regard to Section 3(c) of such Act.

In rendering such opinions, such counsel may (A) state that its opinion is
limited to the laws of New York, the laws of the State of New Jersey and the
Federal laws of the United States and (B) rely as to matters involving the
application of laws of any jurisdiction other than New York, New Jersey or the
United States, to the extent deemed proper and specified in such opinion, upon
the opinion of other counsel of good standing believed to be reliable and who
are satisfactory to you and as to matters of fact, to the extent deemed proper,
on certificates of responsible officers of the Company and public officials.

 

A-3

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

ANNEX B

Pursuant to Section 5(b) of the Placement Agreement, special Delaware counsel
for the Trust shall deliver an opinion in substantially the following form:

1. The Trust has been duly formed and is validly existing in good standing as a
statutory trust under the Delaware Act.

2. The Declaration constitutes a valid and binding obligation of the Sponsor and
Trustees party thereto, enforceable against such Sponsor and Trustees in
accordance with its terms.

3. Under the Delaware Act and the Declaration, the Trust has the requisite trust
power and authority (i) to own its properties and conduct its business, all as
described in the Declaration, (ii) to execute and deliver, and perform its
obligations under, the Operative Documents to which it is a party, (iii) to
authorize, issue, sell and perform its obligations under its Capital Securities
and Common Securities, and (iv) to purchase and hold the Subordinated Debt
Securities.

4. The Capital Securities have been duly authorized for issuance by the Trust
and, when issued, executed and authenticated in accordance with the Declaration
and delivered against payment therefor in accordance with the Declaration and
the Subscription Agreement, will be validly issued and, subject to the
qualifications set forth in paragraph 5 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust and the holders of the
Capital Securities will be entitled to the benefits provided by the Declaration.

5. Each holder of Capital Securities, in such capacity, will be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware. We note, however, that the holders of the Capital Securities may be
required to make payment or provide indemnity or security as set forth in the
Declaration.

6. Under the Declaration and the Delaware Act, the issuance of the Capital
Securities and Common Securities is not subject to preemptive rights.

7. The Common Securities have been duly authorized for issuance by the Trust
and, when issued and executed in accordance with the Declaration and delivered
against payment therefor in accordance with the Declaration and the subscription
agreement therefor, will be validly issued undivided beneficial interests in the
assets of the Trust and the holders of the Common Securities will be entitled to
the benefits provided by the Declaration.

8. Under the Declaration and the Delaware Act, the execution and delivery by the
Trust of the Operative Documents to which it is a party, and the performance by
the Trust of its obligations thereunder, have been duly authorized by the
requisite trust action on the part of the Trust.

9. The issuance and sale by the Trust of its Capital Securities and Common
Securities, the execution, delivery and performance by the Trust of the
Operative Documents to

 

B-1

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

which it is a party, the consummation by the Trust of the transactions
contemplated by the Operative Documents to which it is party, and the compliance
by the Trust with its obligations thereunder are not prohibited by (i) the
Declaration or the Trust Certificate, or (ii) any law or administrative
regulation of the State of Delaware applicable to the Trust.

10. No authorization, approval, consent or order of any Delaware court or
Delaware governmental authority or Delaware agency is required to be obtained by
the Trust solely in connection with the issuance and sale by the Trust of its
Capital Securities and Common Securities, the due authorization, execution and
delivery by the Trust of the Operative Documents to which it is a party or the
performance by the Trust of its obligations under the Operative Documents to
which it is a party.

11. The holders of the Capital Securities (other than those holders who reside
or are domiciled in the State of Delaware) will have no liability for income
taxes imposed by the State of Delaware solely as a result of their participation
in the Trust, and the Trust will not be liable for any income tax imposed by the
State of Delaware.

 

B-2

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

ANNEX C

Pursuant to Section 5(c) of the Placement Agreement, special tax counsel for the
Offerors shall deliver an opinion in substantially the following form:

We have acted as special tax counsel to Lakeland Bancorp, Inc., a New Jersey
corporation (the “Company”), in connection with the offering by Lakeland Bancorp
Capital Trust IV (the “Trust”) of 20,000 MMCapSSM (liquidation amount $1,000 per
capital security) (the “Capital Securities”). This opinion letter is furnished
pursuant to Section 5(c) of the Placement Agreement, dated May 14, 2007, among
the Company, the Trust and you.

In arriving at the opinions expressed below we have examined executed copies of
(i) the Amended and Restated Declaration of Trust of the Trust dated the date
hereof (the “Declaration”), and (ii) the Indenture relating to the issuance of
the Fixed/Floating Rate Junior Subordinated Debt Securities due 2037 (the
“Subordinated Debt Securities”), dated as of the date hereof (the “Indenture”)
(together, the “Operative Documents”). In addition, we have made such
investigations of law and fact as we have deemed appropriate as a basis for the
opinion expressed below.

It is our opinion that, under current law and assuming the performance of the
Operative Documents in accordance with the terms described therein, the
Subordinated Debt Securities will be treated for United States federal income
tax purposes as indebtedness of the Company.

It is our opinion that the Trust will be classified for United States federal
income tax purposes as a grantor trust and not as an association taxable as a
corporation.

Our opinion is based on the U.S. Internal Revenue Code of 1986, as amended,
Treasury regulations promulgated thereunder, and administrative and judicial
interpretations thereof, all as of the date hereof and all of which are subject
to change, possibly on a retroactive basis. In rendering this opinion, we are
expressing our views only as to the federal income tax laws of the United States
of America.

 

C-1

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

ANNEX D

Pursuant to Section 5(d) of the Placement Agreement, counsel to the Guarantee
Trustee, the Institutional Trustee, the Delaware Trustee and the Indenture
Trustee shall deliver an opinion in substantially the following form:

1. Wilmington Trust Company (“WTC”) is a Delaware banking corporation with trust
powers, duly incorporated, validly existing and in good standing under the laws
of the State of Delaware, with requisite corporate power and authority to
execute and deliver, and to perform its obligations under, the Declaration, the
Guarantee Agreement and the Indenture (collectively, the “Transaction
Documents”).

2. The execution, delivery, and performance by WTC of the Transaction Documents
have been duly authorized by all necessary corporate action on the part of WTC,
and the Transaction Documents have been duly executed and delivered by WTC.

3. The execution, delivery and performance of the Transaction Documents by WTC
and the consummation of any of the transactions by WTC contemplated thereby are
not prohibited by (i) the charter or bylaws of WTC, (ii) any law or
administrative regulation of the State of Delaware or the United States of
America governing the banking and trust powers of WTC, or (iii) to our knowledge
(based and relying solely on the Officer Certificates), any agreements or
instruments to which WTC is a party or by which WTC is bound or any judgments or
order applicable to WTC.

4. The Subordinated Debt Securities delivered on the date hereof have been
authenticated by due execution thereof and delivered by WTC, as Indenture
Trustee, in accordance with the Indenture. The Capital Securities delivered on
the date hereof have been authenticated by due execution thereof and delivered
by WTC, as Institutional Trustee, in accordance with the Declaration.

5. None of the execution, delivery and performance by WTC of the Transaction
Documents and the consummation of any of the transactions by WTC contemplated
thereby requires the consent, authorization, order or approval of, the
withholding of objection on the part of, the giving of notice to, the
registration with or the taking of any other action in respect of, any
governmental authority or agency, under any law or administrative regulation of
the State of Delaware or the United States of America governing the banking and
trust powers of WTC, except for the filing of the Trust Certificate with the
Office of the Secretary of State of the State of Delaware pursuant to the
Delaware Act (which filing has been duly made).

 

D-1

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

ANNEX E

[THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE DECLARATION
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST
COMPANY (“DTC”) OR A NOMINEE OF DTC. THIS SECURITY IS EXCHANGEABLE FOR CAPITAL
SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION, AND NO TRANSFER OF
THIS CAPITAL SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY DTC
TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY
BE REGISTERED EXCEPT IN THE CIRCUMSTANCES SPECIFIED IN THE DECLARATION.

UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE
TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
SECURITY ISSUED 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 IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]1

THIS SECURITY 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 SECURITY NOR ANY INTEREST OR
PARTICIPATION 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 REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY OR ANY INTEREST
OR PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY
BE, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY OR ANY INTEREST OR
PARTICIPATION HEREIN PRIOR TO THE DATE WHICH IS THE LATER OF (i) TWO YEARS (OR
SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES
ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF AND (Z) THE
LAST DATE ON WHICH THE TRUST OR ANY AFFILIATE (AS DEFINED IN RULE 405 UNDER THE
SECURITIES ACT) OF THE TRUST WAS THE HOLDER OF THIS SECURITY OR SUCH INTEREST OR
PARTICIPATION (OR ANY PREDECESSOR THERETO) AND (ii) SUCH LATER DATE, IF ANY, AS
MAY BE REQUIRED BY ANY SUBSEQUENT CHANGE IN APPLICABLE LAW, ONLY (A) TO THE
DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT (“RULE 144A”), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL

 

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

1

Only applicable if this Capital Security is a Global Capital Security.

 

E-1

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

BUYER,” AS DEFINED IN RULE 144A, THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO AN “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2), (3), (7) OR (8) OF
RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY OR SUCH
INTEREST OR PARTICIPATION FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, (D) PURSUANT TO OFFERS AND SALES TO NON-US PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES PURSUANT TO REGULATION S UNDER THE SECURITIES ACT OR
(E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT, SUBJECT TO THE RIGHT OF THE DEBENTURE ISSUER AND THE
TRUST PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (C) OR
(E) ABOVE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE AMENDED
AND RESTATED DECLARATION OF TRUST, A COPY OF WHICH MAY BE OBTAINED FROM THE
DEBENTURE ISSUER OR THE TRUST. THE HOLDER OF THIS SECURITY OR ANY INTEREST OR
PARTICIPATION HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY BE,
AGREES THAT IT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.

THE HOLDER OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, BY ITS
ACCEPTANCE HEREOF OR THEREOF, AS THE CASE MAY BE, ALSO AGREES, REPRESENTS AND
WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY
WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT
IN THE ENTITY AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR
HOLD THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN, UNLESS SUCH
PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S.
DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38,
90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF
THIS SECURITY OR SUCH INTEREST OR PARTICIPATION IS NOT PROHIBITED BY SECTION 406
OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE OR HOLDING.
ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN
WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING HEREOF OR
THEREOF, AS THE CASE MAY BE, THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN
WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF
THE CODE IS

 

E-2

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

APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE
BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE AND HOLDING
WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR
ADMINISTRATIVE EXEMPTION.

IN CONNECTION WITH ANY TRANSFER, THE HOLDER OF THIS SECURITY WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE
REQUIRED BY THE AMENDED AND RESTATED DECLARATION OF TRUST TO CONFIRM THAT THE
TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A
LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A LIQUIDATION
AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN FOR ANY PURPOSE,
INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS SECURITY OR
SUCH INTEREST OR PARTICIPATION, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO
HAVE NO INTEREST WHATSOEVER IN THIS SECURITY OR ANY INTEREST OR PARTICIPATION
HEREIN.

 

E-2