(CDFI Cr edit Unions

Senio r Securities)

UNITED STATES DEPARTMENT OF THE TREASURY

1500 PENNSY LVANIA AVENUE. NW

WASHINGTON. D,C. 20220

Dear Ladies and Gentlemen:

The credit union set forth on the signature page hereto (the "Credit Union ") intends to

issue in a private placement the subordinated deben tures set forth on Schedu le A hereto (the

"Senior Subordinated Securities") and the United State s Depart ment of the Treasury (the

" Investor" ) intends to purchase from the Credit Union the Senior Subordinated Securities,

The purpose of this letter agreement is to confirm the terms and cond itions of the

purchase by the Investor of the Senior Subordinated Securities , Except to the extent

supplemented or superse ded by the terms set forth herein or in the Schedules hereto, the

provisions contained in the Securities Purchase Agreement - Standard Terms attached hereto as

Exhibit A (the "Securities Purchase Agreem ent") are incorporated by reference herein , Terms

that are defined in the Securities Purchase Agreement arc used in this letter agreement as so

defined. In the event of any inconsistency betwee n this letter agreement and the Securities

Purchase Agreement, the terms of this letter agreement shall govern ,

Each of the Credit Union and the Investor hereby confir ms its agreeme nt with the other

party with respect to the issuan ce by the Credit Union of the Senior Subordinate d Securities and

the purchase by the Investor of the Senior Subordinated Securities pursuant to this letter

agreement and the Securities Purchase Agre ement on the terms specified on Schedule A hereto.

This letter agreement (includi ng the Schedules hereto). the Securities Purchase

Agreement (includi ng the Annexes thereto) and the Disclosur e Schedu les (as defined in the

Securities Purchase Agreement) con stitute the entire agreeme nt, and supersede all other prior

agreements. understandings. representations and warranties, both written and oral, between the

parties, with respect to the subject matter hereof This letter agreem ent const itutes the "Letter

Agreemen t" referred to in the Securities Purchase Agreement.

This letter agreement may be exec uted in any numbe r of separate counterparts . each such

counterpart being deemed to be an original instrume nt, and all such counterparts will togethe r

con stitute the same agreement. Executed signature pages to this letter agreement may be

deli vered by facsimile and such facsim iles will be deemed as sufficie nt as if actual signature

pages had bcen de livere d.

* * *

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In witness whereof, this letter agreement has been duly executed and delivered by the

duly authorized representatives ofthe parties hereto as ofthe date written below.

UNITED STATES DEPARTMENT OF THE

TREASURY

By:

Name:

Title:

UNION BAPTIST CHURCH FEDERAL

CREDIT UNION

By:

Date: September 24,2010

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In witne ss whereof, this letter 'agreement has been duly executed and delivered by the

duly authorized representatives of the parties hereto as ofthe date written below.

UNITED STATES DEPARTMENT OF THE

EAS~

By: ' yU~.4-- Name: J)g,yj d N· /vIi/(u:

Title: Chi t'±' .I;.,V('S+1'!'1017 QfR'CerUNION BAPTIST CHURCH FEDERAL

CREDIT UNION

By:

Date: September 24, 2010

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SECURITIES PURCHASE AGREEMENT

STANDARD TERMS

EXHIBIT A

(CDFI Credit Unions

Senior Securities)
TABLE OF CONTENTS

Page

ARTICLE I

Section 1.1

Section 1.2

Section 2.1

Section 2.2

Section 2.3

Section 3.1

Section 4.1

Section 4.2

Section 5.1

Section 5.2

Section 5.3

Section 5.4

Section 5.5

Section 6.1

Section 6.2

Section 6.3

Section 6.4

Section 6.5

Section 6.6

Definitions.......... . 1

Interpretation.. . 5

ARTICLE II

PURCHASE; CLOSING

Purchase 5

Closing 5

Closing Conditions 6

ARTICLE III

REPRESENTATIONS AND WARRANTIES

Representations and Warranties of the Credit Union 9

ARTICLE IV

COVENANTS

Affirmative Covenants 17

Negative Covenants . 23

ARTICLE V

REMEDIES OF THE HOLDERS UPON EVENT OF DEFAULT

Event ofDefault 24

Acceleration and Other Remedies 25

Suits for Enforcement .25

Holders May File Proofs of Claim .25

Waiver ofPast Defaults 26

ARTICLE VI

ADDITIONAL AGREEMENTS

Purchase for Investment.. .26

Form of Senior Subordinated Security 26

Execution of Senior Subordinated Securities .26

Computation ofInterest 27

Legends .28

Transfer of Senior Subordinated Securities 30

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Section 6.7

Section 6.8

Section 6.9

Section 6.10

Section 6.11

Section 6.12

Section 6.13

Section 6.14

Section 6.15

Replacement of Senior Subordinated Securities 31

Cancellation 31

Depository Senior Subordinated Securities 31

Redemption 31

Voting Rights 33

Secondary Capital Account Status 34

Rule 144; Rule 144A; 4(1 Y2) Transactions 35

Expenses and Further Assurances 36

Communications to Holders 36

Section 7.1

Section 7.2

Section 7.3

Section 7.4

Section 7.5

Section 7.6

ARTICLE VII

SUBORDINATION OF THE SENIOR SUBORDINATED SECURITIES

Agreement to Subordinate 37

Default on Senior Indebtedness 37

Liquidation; Dissolution 38

Subrogation 39

Notice by the Credit Union .40

Subordination May Not Be Impaired .40

ARTICLE VIII

MISCELLANEOUS

Section 8.1

Section 8.2

Section 8.3

Section 8.4

Section 8.5

Section 8.6

Section 8.7

Section 8.8

Section 8.9

Section 8.10

Section 8.11

Termination .41

Survival 41

Amendment 42

Waiver of Conditions .42

GOVERNING LAW; SUBMISSION TO JURISDICTION, ETC ..42

Notices .43

Assignment 43

Severability .44

No Third-Party Beneficiaries .44

Tax Treatment of Senior Subordinated Sccurities .44

Specific Performance 44

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LIST OF ANNEXES

ANNEX A: FORM OF SENIOR SUBORDINATED SECU RITIES

ANNEX B: FORM or OHICEWS CERTIFICATE

ANNEX C: rORM OF WAIVE R

ANNEX 0: FORM OF OPINION

ANNEX E: cORM or DISCL OSURE AND ACK NOW LEDG EMENT

ANNEX F: FORM OF OFFICER'S CERTIFICATE (CDFI REQUIREMENTS)

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INDEX OF DEFINED TERMS

Term

Additional Dividend

Affiliate

Agreement

Appropriate Supervisory Authority

Bankruptcy Exceptions

Benefit Plans

Board of Directors

Business Combination

business day

Capitalization Date

Capital Interests

CDCI

CDFI

CDFI Application

CDFI Application Update

CDFI Events

Certified Entities

Charter

Closing

Closing Date

Code

Compensation Regulations

control; controlled by; under common control with

Controlled Group

Credit Union

Credit Union Financial Statements

Credit Union Material Adverse Effect

Credit Union Reports

Credit Union Subsidiary: Credit Union Subsidiaries

Defaulted Interest

Disclosure Schedule

Disclosure Update

EESA

ERISA

Event of Default

Exchange Act

Federal Credit Union Act

Fund

GAAP

Governmental Entities

Holder

Indebtedness

Location of

Definition ---

4.2(b )(ii)

1.1

Recitals

11

3.1(c)

2.3(f)

3.1(I)

8.7

1.2

3.1(b)

3.1(b)

Recitals

3.1(d)

2.3(1)

2.3(1)

11

2.3(d)

4.1(d)(iv)

2.2

2.2

3.1(n)

2.3(1)

1.1

3.1(n)

Recitals

2.3(m)

1.1

3.1(i)

3.1(a)

6A(c)

1.1

2.3(k)

2.3(f)

3.1(n)

5.1

6.6(f)

3.1(d)

3.l(d)

1.1

2.3(a)

1.1

1.1

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Term

Indemnitee

Indenture

Indenture Act

Information

Interest Holders

Interest Payment Date

Interest Period

Interest Rate

Investor

knowledge ofthe Credit Union; Credit Union's knowledge

Letter Agreement

Majority Holders

Maturity Date

Members

Member Shares

MHA

NCUA Regulations

Obligor

Other Capital Instruments

Plan

Previously Disclosed

Proprietary Rights

Purchase

Purchase Price

RAP

Redemption Date

Regular Record Dale

Regulatory Agreement

Relevant Period

Schedules

SCP Notice

SEC

Seeondary Capital Account

Secondary Capital Plan

Section 4.I(e) Employee

Location of

Definition

6.13(b)

6.1

6.1

4.1(c)(iii)

3.I(e)

Face of Senior

Subordinated

Seeurity

6.4(b)

Face of Senior

Subordinated

Security

Recitals

l.l

Reeitals

5.3

Face of Senior

Subordinated

Security

l.l

3.1(b)

4.I(g)

2.3(n)

5.4

3.1(b)

3.I(n)

l.l

3.1 (u)

Recitals

2.1

1.1

6.IO(a)

Face of Senior

Subordinated

Security

3.I(s)

2.3(1)

Recitals

2.3(n)

3.1 (k)

6.12(a)

2.3(n)

4.I(e)

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Term

Securities Act

Senior Executive Officers

Senior Indebtedness

Senior Subordinated Securities Register

Senior Subordinated Securities

Significant Subsidiary

Signing Dale

State Restrictions

State Supervisory Authority

subsidiary

Tax; Taxes

Transaction Documents

Transfer

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-VILocation of

Definition -..._.__.._----_._----

3.I(a)

1.1

1.1

6.6(a)

Recitals

3.1(a)

1]

i.:

1.1

1]

1]

1.1

6.6(f)
SECURITIES PURCHASE AGREEMENT - STANDARD TERMS

Recitals:

WHEREAS, the United States Department of the Treasury (the "Investor") may from

time to time agree to purchase senior subordinated debentures from eligible financial institutions

which elect to participate in the Community Development Capital Initiative ("CDCr);

WHEREAS, an eligible credit union electing to participate in the CDCI and issue

securities to the Investor shall enter into a letter agreement (the "Letter Agreement") with the

Investor which incorporates this Securities Purchase Agreement - Standard Terms (the eligible

credit union identified in the Letter Agreement, the "Credit Union");

WHEREAS, the Credit Union agrees to support the availability of credit and financial

services to underserved populations and communities in the United States to promote the

expansion ofsmall businesses and the creation ofjobs in such populations and communities;

WHEREAS, the Credit Union agrees to work diligently, under existing and any future

programs, to modify the terms of residential mortgages as appropriate to strengthen the health of

the U.S. housing market;

WHEREAS, the Credit Union intends to issue in a private placement senior subordinated

debentures ("Senior Subordinated Securities"), in an amount as set forth on Schedule A to the

Letter Agreement and the Investor intends to purchase (the "Purchase") from the Credit Union

the Senior Subordinated Securities; and

WHEREAS, the Purchase will be governed by this Securities Purchase Agreement

Standard Terms and the Letter Agreement, including the schedules thereto (the "Schedules"),

specifying additional terms of the Purchase. This Securities Purchase Agreement - Standard

Terms (including the Annexes hereto) and the Letter Agreement (including the Schedules

thereto) arc together referred to as this "Agreement". All references in this Securities Purchase

Agreement - Standard Terms to "Schedules" are to the Schedules attached to the Letter

Agreement.

NOW, THEREFORE, in consideration of the premises, and of the representations,

warranties, covenants and agreements set forth herein, the parties agree as follows:

ARTICLE I

Section 1.1 Definitions. Except as otherwise specified herein or as the context may

otherwise require, the following terms have the respective meanings set forth below for all

purposes ofthis Agreement.

"Affiliate" means, with respect to any person, any person directly or indirectly

controlling, controlled by or under common control with, such other person. For purposes ofthis

definition, "control" (including, with correlative meanings, the terms "controlled by" and "under

common control with"), when used with respect to any person, means the possession, directly or

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indirectly, of the power to cause the direction of management and/or policies of such person,

whether through the ownership of voting securities by contract or otherwise.

"Appropriate Supervisory Authority" means the National Credit Union Administration in

the case of credit unions chartered under the Federal Credit Union Aet and the appropriate State

Supervisory Authority along with the National Credit Union Administration, where applicable,

in the case of state-chartered credit unions whose share accounts are insured by the National

Credit Union Share Insurance Fund.

"CDFI Events" means the failure by the Credit Union at any time while the Senior

Subordinated Securities are outstanding to (i) be certified by the Community Development

Financial Institution Fund of thc United States Department of the Treasury as a regulated

community development financial institution; (ii) together with all of its Affiliates collectively

meet the eligibility requirements of 12 C.F.R. 1805.200(b); (iii) have a primary mission of

promoting community development, as may be determined by the United States Department of

the Treasury from time to time, based on criteria set forth in 12 C.F.R. 1805.201(b)(1); (iv)

provide Financial Products, Development Services, and/or other similar financing as a

predominant business activity in arm's-length transactions; (v) serve a Target Market by serving

one or more Investment Areas and/or Targeted Populations as may be determined by the United

States Department of the Treasury hom time to time, substantially in the manner set forth in 12

C.F.R. 1805.20 I(b)(3); (vi) provide Development Services in conjunction with its Financial

Products, directly, through an Affiliate or through a contract with a third-party provider; (vii)

maintain accountability to residents of the applicable Investment Area(s) or Targeted

Population(s) through representation on its governing board of directors or otherwise; and (viii)

remain a non-governmental entity which is not an agency or instrumentality of the United States

of America, or any State or political subdivision thereof, as described in 12 C.F.R.

1805.201 (b)( 6) and within the meaning of any supplemental regulations or interpretations of 12

C.F.R. 1805.201(b)(6) or such supplemental regulations published by the Fund. Notwithstanding

any other provision hereof, as used in this definition, the terms "Affiliates"; "Financial

Products"; "Development Services"; "Target Market"; "Investment Areas"; and "Targeted

Populations" have the meanings ascribed to such terms in 12 C.F.R. 1805.l04. A CDFI Event

may be waived in writing by the holders ofa majority of the Senior Subordinated Securities then

outstanding.

"Credit Union Materia! Adverse Effect" means a material adverse effect on (i) the

business, results of operation or financial condition of the Credit Union and its consolidated

subsidiaries taken as a whole; provided, however, that Credit Union Material Adverse Effect

shall not be deemed to include the effects of (A) changes after the date of the Letter Agreement

(the "Signing Date") in general business, economic or market conditions (including changes

generally in prevailing interest rates, credit availability and liquidity, currency exchange rates

and price levels or trading volumes in the United States or foreign securities or credit markets),

or any outbreak or escalation of hostilities, declared or undeclared acts of war or terrorism, in

each case generally affecting the industries in which the Credit Union and its subsidiaries

operate, (B) changes or proposed changes after the Signing Date in generally accepted

accounting principles in the United States CGAAP") or regulatory accounting practices CRAP"),

or authoritative interpretations thereof, or (C) changes or proposed changes after the Signing

Date in securities, banking and other laws of general applicability or related policies or

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interpretations of Governmental Entities (in the case of each of these clauses (A), (B) and (C),

other than changes or occurrences to the extent that such changes or occurrences have or would

reasonably be expected to have a materially disproportionate adverse effect on the Credit Union

and its consolidated subsidiaries taken as a whole relative to comparable U.S. banking or

financial services organizations); or (ii) the ability of the Crcdit Union to consummate the

Purchase and other transactions contemplated by this Agreement and perform its obligations

hereunder or thereunder on a timely basis.

"Disclosure Schedule" means that certain schedule to this Agreement delivered to the

Investor on or prior to the Signing Date, selling forth, among other things, items the disclosure of

which is necessary or appropriate either in response to an express disclosure requirement

contained in a provision hereof or as an exception to one or more representations or warranties

contained in Section 3.1.

"Holder" means a holder ofthe Senior Subordinated Securities.

"Indebtedness" means, whether or not recourse is to all or a portion of the assets of the

Credit Union and whether or not contingent, (i) the claims of the Credit Union's secured and

general creditors; (ii) every obligation of the Credit Union for money borrowed; (iii) every

obligation of the Credit Union evidenced by bonds, debentures, notes or other similar

instruments, including obligations incurred in connection with the acquisition of property, assets

or businesses; (iv) every reimbursement obligation of the Credit Union, contingent or otherwise,

with respect to letters of credit, bankers' acceptances, security purchase facilities or similar

facilities issued for the account of the Credit Union; (v) every obligation of the Credit Union

issued or assumed as the deferred purchase price of property or services (but excluding trade

accounts payable or accrued liabilities arising in the ordinary course of business); (vi) every

capitallcase obiigation 0 I' the Credit Union; (vii) all indebtedness of the Credit Union for claims

in respect of derivative products, including interest rate, foreign exchange rate and commodity

forward contracts, options and swaps and similar arrangements; (viii) every obligation of the

type referred to in clauses (i) through (vii) of another person and all dividends of another person

the payment of which, in either case, the Credit Union has guaranteed or is responsible or liable

for directly or indirectly, as obligor or otherwise; and (ix) every obligation of the type referred to

in clauses (i) through (vii) of another person and all dividends of another person the payment of

which, in either case, is secured by a lien on any property or assets ofthe Credit Union,

"knowledge of the Credit Union" or "Credit Union's knowledge" means the actual

knowledge after reasonable and due inquiry of the "officers" (as such term is defined in Rule 3b2 under the Exchange Act) ofthe Credit Union.

"Members" means persons having ownership rights in the Credit Union by virtue oftheir

ownership of a deposit at the Credit Union. The amount of the (i) "Additional Dividends" and

(ii) total dividends declared and paid in each case for the year ended December 31, 2009 are set

forth on Schedule B.

"Previously Disclosed' means information set forth on the Disclosure Schedule or the

Disclosure Update, as applicable; provided, however, that disclosure in any section of such

Disclosure Schedule or Disclosure Update, as applicable, shall apply only to the indicated

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section ofthis Agreement except to the extent that it is reasonably apparent from the face ofsuch

disclosure that such disclosure is relevant to another section of this Agreement; provided,

further, that the existence of Previously Disclosed information, pursuant to a Disclosure Update,

shall neither obligate the Investor to consummate the Purchase nor limit or affect any rights of or

remedies available to the Investor.

"Senior Executive Officers" means the Credit Union's "senior executive officers" as

defined in Section 111 ofEESA and the Compensation Regulations.

"Senior Indebtedness" means, with respect to the Senior Subordinated Securities, (i) all

deposit liabilities of the Credit Union, (ii) the principal of (and premium, if any) and interest, if

any (including interest accruing on or after the appointment of a receiver or conservator relating

to the Credit Union, whether or not such claim for post appointment interest is allowed), on all

Indebtedness, whether outstanding on the date of execution of this Agreement, or hereafter

created, assumed or incurred, and any deferrals, renewals or extensions of such Indebtedness,

(iii) any obligation to holders of Capital Interests or shares of equity in the Credit Union (if and

upon conversion of the Credit Union to a stock-based entity) arising as a result of their status as

holders of such Capital Interests or shares of equity and (iv) any claims of the National Credit

Union Share Insurance Fund, provided, however, that Senior Indebtedness shall not include any

other subordinated debt of the Credit Union that by its terms ranks pari passu or junior to the

Senior Subordinated Securities issued hereunder.

"State Restrictions" means, if the Credit Union is organized under the laws of any state,

any restrictions imposed by the laws of such state on voting rights of holders of the Senior

Subordinated Securities that cannot be modified, waived or otherwise removed by the

appropriate Governmental Entity ofsuch state.

"State Supervisory Authority" means the appropriate governmental agency of the state in

which the Credit Union is chartered, which regulates state-chartered credit unions.

"subsidiary" means any corporation, partnership, joint venture, limited liability company,

credit union or other entity (x) of which such person or a subsidiary of such person is a general

partner or (y) of which a majority of the voting securities or other voting interests, or a majority

of the securities or other interests of which having by their terms ordinary voting power to elect a

majority of the board of directors or persons performing similar functions with respect to such

entity, is directly or indirectly owned by such person and/or one or more subsidiaries thereof.

"Tax" or "Taxes" means any federal, state, local or foreign income, gross receipts,

property, sales, use, license, excise, franchise, employment, payroll, withholding, alternative or

add on minimum, ad valorem, transfer or excise tax, or any other tax, custom, duty,

governmenra! fee or other like assessment or charge of any kind whatsoever, together with any

interest, penalty or addition imposed by any Governmental Entity.

"Transaction Documents" means this Agreement, the Senior Subordinated Securities, and

all other instruments, documents and agreements executed by or on behal I' of the Credit Union

and delivered concurrently herewith or at any time hereafter to or for the benefit of any holder of

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any Senior Subordinated Security in connection with the transactions contemplated by this

Agreement, all as amended, supplemented or modified from time to time.

Section 1.2 Interpretation. When a reference is made in this Agreement to "Recitals,"

"Articles" , "Sections" , or "Annexes" such reference shall be to a Recital, Article or Section of,

or Annex to, this Securities Purchase Agreement - Standard Terms, and a reference to

"Schedules" shall be to a Schedule to the Letter Agreement, in each case, unless otherwise

indicated. The terms defined in the singular have a comparable meaning when used in the plural,

and vice versa. References to "herein", "hereof', "hereunder" and the like refer to this

Agreement as a whole and not to any particular section or provision, unless the context requires

otherwise. The table of contents and headings contained in this Agreement are for reference

purposes only and are not part of this Agreement. Whenever the words "include", "includes" or

"including" are used in this Agreement, they shall be deemed followed by the words "without

limitation". No rule of construction against the draftsperson shall be applied in connection with

the interpretation or enforcement of this Agreement, as this Agreement is entered into between

sophisticated parties advised by counsel. All references to "$" or "dollars" mean the lawful

currency of the United States of America. Except as expressly stated in this Agreement, all

references to any statute, rule or regulation are to the statute, rule or regulation as amended,

modified, supplemented or replaced from time to time (and, in the case of statutes, include any

rules and regulations promulgated under the statute) and to ally section of any statute, rule or

regulation include any successor to the section. References to a "business day" shall mean any

day except Saturday, Sunday and any day on which banking institutions in the State of New

York or the District of Columbia generally are authorized or required by law or other

governmental actions to close.

ARTICLE II

Purchase; Closing

Section 2.1 Purchase. On the terms and subject to the conditions set forth in this

Agreement, the Credit Union agrees to sell to the Investor, and the Investor agrees to purchase

from the Credit Union, at the Closing (as hereinafter defined), the Senior Subordinated Securities

in the form attached hereto as Annex A, appropriately completed in conformity herewith and

duly and validly issued, authorized and executed by the Credit Union, in the aggregate principal

amount set forth on Schedule A for the purchase price set forth on Schedule A (the "Purchase

Price"). The Senior Subordinated Securities, including the principal and interest, shall be

unsecured and subordinate and junior in right of payment to Senior Indebtedness to the extent set

forth in Article VII hereof.

Section 2.2 Closing. (a) On the terms and subject to the conditions set forth in this

Agreement, the closing ofthe Purchase (the "Closing") will take place at the location specified in

Schedule A, at the time and on the date set forth in Schedule A or as soon as practicable

thereafter, or at such other place, time and date as shall bc agreed between the Credit Union and

the Investor. The time and date on which the Closing occurs is referred to in this Agreement as

the "Closing Date".

(b) Subject to the fulfillment or waiver ofthe conditions to the Closing in Section 2.3,

at the Closing the Credit Union will deliver the Senior Subordinated Securities, as evidenced by

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one or more debentures dated the Closing Date and bearing appropriate legends as hereinafter

provided for, in exchange for payment in full of the Purchase Price by wire transfer of

immediately available United States funds to a bank account or credit union account designated

by the Credit Union on Schedule A.

Section 2,3 Closing Conditions. The obligation of the Investor to consummate the

Purchase is subject to the fulfillment (or waiver by the Investor) at or prior to the Closing of each

ofthe following conditions:

(a) (i) any approvals or authorizations of all United States and other governrnental,

regulatory or judicial authorities (collectively, "Governmental Entities") required for the

consummation of the Purchase shall have been obtained or made in form and substance

reasonably satisfactory to each party and shall be in full force and effect and all waiting periods

required by United States and other applicable law, if any, shall have expired and (ii) no

provision of any applicable United States or other law and no judgment, injunction, order or

decree of any Governmental Entity shall prohibit the purchase and sale of the Senior

Subordinated Securities as contemplated by this Agreement;

(b) (i) the representations and warranties of the Credit Union set forth in Seetion 3.1

shall be true and correct in all respects as though made on and as ofthe Closing Date (other than

representations and warranties that by their terms speak as of another date, which representations

and warranties shall be true and correct in all respects as of such other date) and (ii) the Credit

Union shall have performed in all respects all obligations required to be performed by it under

this Agreement at or prior to the Closing;

(c) the Credit Union shall have delivered to the Investor a certificate signed on behalf

of the Credit Union by a Senior Executive Officer certifying to the effect that the conditions set

forth in Section 2.3(b) have been satisfied, in substantially the form attached hereto as Annex B;

(d) if applicable, the Credit Union shall have duly adopted and filed with the

Secretary of State 01' its jurisdiction of organization or other applicable Governmental Entity, an

amendment to its certificate or articles of incorporation, articles 01' association, organization

certificate or similar organizational document ("Charter") and its bylaws as in effect on the

Closing Date;

(c) the Credit Union shall have delivered to the Investor true, complete and correct

certified copies ofthe Charter and bylaws ofthe Credit Union:

(I) (i) the Credit Union shall have effected such changes to its compensation, bonus,

incentive and other benefit plans, arrangements and agreements (including golden parachute,

severance and employment agreements) (collectively, "Bene/it Plans") with respect to its Senior

Executive Officers and any other employee of the Credit Union or its Affiliates subject to

Section 1I I of the Emergency Economic Stabilization Act of 2008, as amended by the American

Recovery and Reinvestment Act of 2009, or otherwise from time to time ("EESA"), as

implemented by any guidance, rule or regulation thereunder, as the same shall be in effect from

time to time (collectively, the "Compensation Regulations") (and to the extent necessary for such

changes to be legally enforceable, each of its Senior Executive Officers and other employees

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shall have duly consented in writing to such changes), as may be necessary, during the period in

which any obligation of the Crcdit Union arising from financial assistance under the Troubled

Asset Relief Program remains outstanding (such period, as it may be further described in the

Compensation Regulations, the "Relevant Period"), in order to comply with Section III of

EESA or the Compensation Regulations, and (ii) the Investor shall have received a certificate

signed on behalf of the Credit Union by a Senior Executive Officer certifying to the effect that

the condition set forth in Section 2.3(f)(i) has been satisfied, in substantially the form attached

hereto as Annex B:

(g) each of the Credit Union's Senior Executive Officers and any other employee of

the Credit Union or its Affiliates subject to Section III of EESA shall have delivered to the

Investor a written waiver in the form attached hereto as Annex C releasing the Investor and the

Credit Union hom any claims that such Senior Executive Officer or other employee may

otherwise have as a result ofthe modification of, or the agreement ofthe Credit Union hereunder

to modify, the terms of any Benefit Plans with respect to its Senior Executive Officers or other

employees to eliminate any provisions of such Benefit Plans that would not be in compliance

with the requirements of Section 111 of EESA, as implemented by the Compensation

Regulations;

(h) the Credit Union shall have delivered to the Investor a written opnuon from

counsel to the Credit Union (which may he internal counsel), addressed to the Investor and dated

as ofthe Closing Date, in substantially the form attached hereto as Annex D;

(i) the Credit Union shall have delivered physical certificated debentures in proper

form evidencing the Senior Subordinated Securities to the Investor or its designee(s) in the form

attached hereto as Annex A:

(j) the Credit Union shall have taken all necessary action to ensure that the Credit

Union and its executive officers, respectively, arc in compliance with (i) all guidelines put forth

by the Investor with respect to transparency, reporting and monitoring and (ii) the provisions of

EESA and any federal law respecting EESA, including the Employ American Workers Act

(Section 1611 of Division A, Title XVI of the American Recovery and Reinvestment Act of

2009), Public Law No. 111-5, effective as of February 17, 2009, and all rules, regulations and

guidance issued thereunder:

(k) the Credit Union shall have delivered to the Investor a copy of the Disclosure

Schedule on or prior to the Signing Date and to the extent, that any information set forth on the

Diselosure Schedule needs to be updated or supplemented to make it true, complete and correct

as of the Closing Date, (i) the Credit Union shall havc delivered to the Investor an update to the

Disclosure Schedule (the "Disclosure Update"), setting forth any information necessary to make

the Disclosure Schedule true, correct and complete as ofthe Closing Date and (ii) the Investor, in

its sole discretion, shall have approved the Disclosure Update, provided, however, that the

delivery and acceptance of the Disclosure Update shall not limit or affect any rights of or

remedies available to the Investor;

(1) the Credit Union shall have delivered to the Investor prior to the Signing Date

either (i) a true, complete and correct certified copy of the CDFI Certification Application that

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US2000 11393227.1

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the Credit Union submitted to the Fund in connection with its certification as a CDFI along with

any updates to the CDFI Certification Application necessary to make it true, complete and

correct as of the Signing Date or (ii) to the extent a copy of the CDFJ Certification Application

that the Credit Union submitted to the Fund in connection with its ecrtification as a CDFI is not

available, a newly completed CDFI Certification Application true, complete and correct as ofthe

Signing Date (the CDFJ Certification Application, delivered to the Investor pursuant to this

Section 2.3(1), the "CDF! Application"), and, to the extent any information set forth in the CDFI

Application is not true, complete and correct as of the Closing Date, the Credit Union shall have

delivered to the Investor an update to the CDFI Application (the "CDFJ Application Update"),

setting forth any information necessary to make the information set forth in the CDFI

Application true, correct and complete as ofthe Closing Date;

(m) the Credit Union shall have delivered to the Investor each of the consolidated

financial statements of the Credit Union and its consolidated subsidiaries for each of the last

three (3) completed fiscal years of the Credit Union (which shall be audited to the extent audited

financial statements are available prior to the Signing Date) and each completed quarterly period

since the last completed fiscal year (collectively, the "Credit Union Financial Statements");

(n) (i) either (A) the Credit Union shall have received notice from the Appropriate

Supervisory Authority that a "Secondary Capital Plan" (within the meaning of Section 70 1.34(b)

of the regulations promulgated by the National Credit Union Administration and codified in 12

C.F.R. Parts 700-796 (the "NCUA Regulations")), covering the Senior Subordinated Securities

has been approved (the "SCP Notice") or (B) 45 days shall have passed since the Credit Union

submitted such a Secondary Capital Plan to the Appropriate Supervisory Authority and such

Secondary Capital Plan has not been approved or disapproved and (ii) the Credit Union shall

have delivered to Investor (A) a certified copy of the SCI' Notice or (B) a certification that such

Secondary Capital Plan has neither been approved nor disapproved; and

(0) the Credit Union shall have delivered to the Investor a copy of a "Disclosure and

Acknowledgement" (within the meaning of Section 701.34(b)(1I) of the NeUA Regulations)

executed by the Credit Union and the Investor as of the Signing Date in the form attached hereto

as Annex E.

ARTICLE III

Representations and Warranties

Section 3.1 Representations and Warranties ofthe Credit Union. Except as Previously

Disclosed, the Credit Union represents and warrants to the Investor that as of the Signing Date

and as ofthe Closing Date (or such other date specified herein):

(a) Organization, Authority and Significant Subsidiaries. The Credit Union has been

duly formed and is validly existing and in good standing as a credit union chartered under the

laws of its jurisdiction of organization, with the necessary power and authority to own, operate

and lease its properties and conduct its business in all material respects as it is being currently

conducted, and except as has not, individually or in the aggregate, had and would not reasonably

be expected to have a Credit Union Material Adverse Effect, has been duly qualified as a foreign

entity for the transaction of business and is in good standing under the laws of each other

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jurisdiction in which it owns or leases properties or conducts any business so as to require such

qualification; each subsidiary of the Credit Union (each, a "Credit Union Subsidiary" and,

collectively, the "Credit Union Subsidiaries") that would be considered a "significant

subsidiary" within the meaning of Rule 1-02(w) of Regulation S-X under the Securities Act of

1933 (the "Securities Act") (each such Credit Union Subsidiary, a "Significant Subsidiary"), has

been duly formed and is validly existing in good standing under the laws of its jurisdiction of

organization. The Charter and bylaws of the Credit Union, copies of which have been provided

to the Investor prior to the Signing Date, are true, complete and correct copies ofsuch documents

as in full force and effect as ofthe Signing Date and as ofthe Closing Date.

(b) Capitalization. The authorized and outstanding credit union membership share

interests, regardless of form ("Member Shares") and capital instruments authorized by law

(ineluding but not limited to subordinated debt ("Other Capital Instruments" and, together with

the Member Shares, collectively, the "Capital In/crests") and any authorized or outstanding

instruments convertible into, or exercisable or exchangeable for, Capital Interests, as of the most

recent fiscal month-end preceding the Signing Date (the "Capitalization Da/e") are set forth on

Schedule B. The outstanding Capital Interests in the Credit Union have been duly authorized

and are validly issued and outstanding, fully paid and nonassessable. Each holder of 5% or more

of the Member Shares, and each holder of Other Capital Instruments, and such holder's primary

address are set forth on Schedule B. The Other Capital Instruments are not subject to preemptive

rights (and were not issued in violation of any preemptive rights). As of the Signing Date, the

Credit Union does not have outstanding any securities or other obligations providing the holder

the right to acquire its Other Capital Instruments that are not reserved for issuance as specified

on Schedule B, and the Credit Union has not made any other commitment to authorize, issue or

sell any Other Capital Instruments that is not specified on Schedule B. Since the Capitalization

Date, the Credit Union has not issued any Other Capital Instruments, except as diselosed on

Schedule B.

(c) Senior Subordinated Securities. The Senior Subordinated Securities. when

executed and delivered, will be, the legal, valid and binding obligations ofthe Credit Union, each

enforceable in accordance with its respective terms, except to the extent that the enforceability

thereof may be limited by applicable bankruptcy, receivership, conservatorship, insolvency,

reorganization, moratorium or similar laws affecting the enforcement of creditors' rights

generally and general equitable principles, regardless of whether such enforceability IS

considered in a proceeding at law or in equity ("Bankrup/cy Exceptions").

(d)

Status.

Low-1ncome Credit Union Status; Communitv Development Financial Institution

(i) The Credit Union (A) is chartered under either (x) the Federal Credit

Union Act ofJune 26, 1934, as amended (the "Federal Credit Union Ad') or (y) the laws

of any State, the District of Columbia or any territory or possession of the United States;

(B) has its deposits insured by the National Credit Union Share Insurance Fund, if it is

not chartered under the Federal Credit Union Act; (C) has a low-income designation

under 12 C.F.R. 701.34; (D) is a "natural person credit union" as defined in 12 C.F.R.

725.2(m) and (E) is not a "corporate credit union" as defined in 12 C.F.R. 704.2.

UST Sequence No. 1390

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(ii) The Credit Union (A), collectively with all of its "Affiliates" (within the

meaning of 12 C.F.R. 1805.104) pursuant to 12 c:.F.R. 1805 .200(b), is a regulated

community development financial institution (a "CDFf') currently certified by the

Community Development Financial Institution Fund (the "Fund") of the United States

Department of the Treasury pursuant to 12 c:.F.R. 1805.201(a) as having satisfied the

eligibility requirements of the Fund's Community Development Financial Institutions

Program and (B) satisfies the eligibility requirements for a CDn set forth in 12 C.F.R.

1805.201(b)(I)(6).

(e) Authorization, Enforceability.

(i) The Credit Union has the power and authority to execute and deliver this

Agreement and to carry out its obligations hereunder and thereunder (which includes the

issuance of the Senior Subordinated Securities). The execution, delivery and

performance by the Credit Union of this Agreement and the consummation of the

transactions contemplated hereby have been duly authorized by all necessary action on

the part of the Credit Union and its Members and other non-Member holders of Capital

Interests (collectively, "Interest Holders"), and no further approval or authorization is

required on the part of the Credit Union. This Agreement is a valid and binding

obligation of the Credit Union enforceable against the Credit Union in accordance with

its terms, subject to the Bankruptcy Exceptions.

(ii) The execution, delivery and performance by the Credit Union of this

Agreement and the consummation of the transactions contemplated hereby and

compliance by the Credit Union with the provisions hereof, will not (A) violate, conflict

with, or result in a breach of any provision of, or constitute a default (or an event which,

with notice or lapse of time or both, would constitute a default) under, or result in the

termination of, or accelerate the performance required by, or result in a right or

termination or acceleration of, or result in the creation or any lien, security interest,

charge or encumbrance upon any of the properties or assets of the Credit Union or any

Credit Union Subsidiary under any of the terms, conditions or provisions of (x) its

organizational documents or (y) any note, debenture, bond, mortgage, indenture, deed of

trust, license, lease, agreement or other instrument or obligation to which the Credit

Union or any Credit Union Subsidiary is a party or by which it or any Credit Union

Subsidiary may be bound, or to which the Credit Union or any Credit Union Subsidiary

or any ofthe properties or assets of the Credit Union or any Credit Union Subsidiary may

be subject, or (B) subject to compliance with the statutes and regulations referred to in the

next paragraph, violate any statute, rule or regulation or any judgment, ruling, order, writ,

injunction or decree applicable to the Credit Union or any Credit Union Subsidiary or any

of their respective properties or assets except, in the ease of clauses (A)(y) and (B), for

those occurrences that, individually or in the aggregate, have not had and would not

reasonably be expected to have a Credit Union Material Adverse Effect.

(iii) Other than the filings with the applicable Governmental Entity, such

filings and approvals as are required to be made or obtained under any state "blue sky"

laws, if applicable, and such as have been made or obtained, no notice to, filing with,

exemption or review by, or authorization, consent or approval of, any Governmental

UST Sequence No. 1390

US200011893227.1

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Entity is required to be made or obtained by the Credit Union in connection with the

consummation hy the Credit Union of the Purchase except for any such notices, filings,

exemptions, reviews, authorizations, consents and approvals the failure of which to make

or obtain would not, individually or in the aggregate, reasonably be expected to have a

Credit Union Material Adverse Effect.

(I) Charter; Bvlaws: Agreements among Interest Holders: Anti-takeover Provisions

and Rights Plan. The Board of Directors of the Credit Union ("Board of Directors") has taken

all necessary action to ensure that the transactions contemplated by this Agreement and the

consummation of the transactions contemplated hereby (i) are not prohibited by the Credit

Union's Charter and bylaws or other organizational documents, or any operating agreement or

agreement among the Interest Holders of the Credit Union, and has obtained all consents

required by its Charter, bylaws or other organizational documents or by such operating

agreement or agreements among Interest Holders of the Credit Union, or has amended the

Charter and bylaws, as is necessary, in order to consummate the transactions contemplated by

this Agreement and (ii) will be exempt from any anti-takeover or similar provisions ofthe Credit

Union's Charier and bylaws, and any other provisions of any applicable anti-takeover laws and

regulations of any jurisdiction.

(g) No Credit Union Material Adverse Effect. Since the last day of the last

completed fiscal period for which financial statements are included in the Credit Union Financial

Statements, no fact, circumstance, event, change, occurrence, condition or development has

occurred that, individually or in the aggregate, has had or would reasonably be expected to have

a Credit Union Material Adverse Effect, except as disclosed on Schedule C.

(h) Credit Union Financial Statements. The Credit Union Financial Statements

present fairly in all material respects the consolidated financial position of the Credit Union and

its consolidated subsidiaries as of the dates indicated therein and the consolidated results oftheir

operations for the periods specified therein: and except as stated therein, such financial

statements (i) were prepared in conformity with either (x) if the Credit Union has assets greater

than $10,000,000, GAAP applied on a consistent basis (except as may be noted therein) or (y) if

the Credit Union has assets under $10,000,000, RAP applied on a consistent basis (except as may

be noted therein) and (ii) have been prepared from, and are in accordance with, the books and

records oftbe Credit Union and the Credit Union Subsidiaries.

(i) Reports.

(i) Since December 31, 2008, the Credit Union and each Credit Union

Subsidiary has filed all reports, registrations, documents, filings, statements and

submissions, together with any amendments thereto, tbat it was required to tile witb any

Governmental Entity (the foregoing, collectively, the "Credit Union Reports") and has

paid all fees and assessments due and payable in connection therewith, except, in each

case, as would not, individually or in the aggregate, reasonably be expected to have a

Credit Union Material Adverse Effect. As of their respective dates of filing, the Credit

Union Reports complied in all material respects with all statutes and applicable rules and

regulations ofthe applicable Governmental Entities.

UST Sequence No. 1390

US2000 I 1893227.1

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(ii) The records, systems, controls, data and information of the Credit Union

and the Credit Union Subsidiaries are recorded, stored, maintained and operated under

means (including any electronic, mechanical or photographic process, whether

computerized or not) that are under the exclusive ownership and direct eontrol of the

Credit Union or the Credit Union Subsidiaries or their aecountants (including all means

of access thereto and therefrom), except for any non-exclusive ownership and non-direct

control that would not reasonably be expected to have a material adverse effect on the

system of internal accounting controls described below in this Section 3.1 (i)(ii). The

Credit Union (A) has implemented and maintains adequate disclosure controls and

procedures to ensure that material information relating to the Credit Union, including the

consolidated Credit Union Subsidiaries, is made known to the chief executive officer and

the chief financial officer ofthe Credit Union by others within those entities, and (B) has

disclosed, based on its most recent evaluation prior to the Signing Date, to the Credit

Union's outside auditors and the audit committee of the Board of Directors of the Credit

Union (x) any significant deficiencies and material weaknesses in the design or operation

of internal controls that are reasonably likely to adversely affect the Credit Union's

ability to record, process, summarize and report financial information and (y) any fraud,

whether or not material, that involves management or other employees who have a

significant role in the Credit Union's internal controls over financial reporting.

(j) No Undisclosed Liabilities. Neither the Credit Union nor any ofthe Credit Union

Subsidiaries has any liabilities or obligations of any nature (absolute, accrued, contingent or

otherwise) which are not properly reflected or reserved against in the Credit Union Financial

Statements to the extent required to be so reflected or reserved against in accordance with

GAAP, except for (i) liabilities that have arisen since the last fiscal year end in the ordinary and

usual course of business and consistent with past practice and (ii) liabilities that, individually or

in the aggregate, have not had and would not reasonably be expected to have a Credit Union

Material Adverse Effect.

(k) Offering of Securities. Neither the Credit Union nor any person acting on its

behalf has taken any action (including any offering of any securities of the Credit Union under

circumstances which would require the integration of such offering with the offering of any of

the Senior Subordinated Securities under the Securities Act, and the rules and regulations of the

Securities and Exchange Commission (the "SEC") promulgated thereunder), which might subject

the offering, issuance or sale of any ofthe Senior Subordinated Securities to Investor pursuant to

this Agreement to the registration requirements ofthe Securities Act.

(I) Litigation and Other Proceedings. Except (i) as set forth on Schedule D or (ii) as

would not. individually or in the aggregate, reasonably be expected to have a Credit Union

Material Adverse Effect, there is no (A) pending or, to the knowledge of the Credit Union,

threatened, claim, action, suit, investigation or proceeding against the Credit Union or any Credit

Union Subsidiary or to which any of their assets are subject, nor is the Credit Union or any

Credit Union Subsidiary subject to any order, judgment or decree, or (B) unresolved violation,

criticism or exception by any Governmental Entity with respect to any report or relating to any

examinations or inspections ofthe Credit Union or any Credit Union Subsidiaries.

UST Sequence No. 1390

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(m) Compliance with Laws. Except as would not, individuaJly or in the aggregate,

reasonably be expected to have a Credit Union Material Adverse Effect, the Credit Union and the

Credit Union Subsidiaries have all permits, licenses, franchises, authorizations, orders and

approvals of, and have made all filings, applications and registrations with, Governmental

Entities that are required in order to permit them to own or lease their properties and assets and

to carryon their business as presently conducted and that are material to the business of the

Credit Union or such Credit Union Subsidiary. Except as set forth on Schedule E, the Credit

Union and the Credit Union Subsidiaries have complied in all respects and are not in default or

violation of, and none ofthem is, to the knowledge of the Credit Union, under investigation with

respect to or, to the knowledge of the Credit Union, have been threatened to be charged with or

given notice of any violation of, any applicable domestic (federal, state or local) or foreign law,

statute, ordinance, license, rule, regulation, policy or guideline, order, demand, writ, injunction,

decree or judgment of any Governmental Entity, other than such noncompliance, defaults or

violations that would not, individually or in the aggregate, reasonably be expected to have a

Credit Union Material Adverse Effect. Except for statutory or regulatory restrictions of general

application or as set forth on Schedule E, no Governmental Entity has placed any restriction on

the business or properties of the Credit Union or any Credit Union Subsidiary that would,

individually or in the aggregate, reasonably be expected to have a Credit Union Material Adverse

Effect.

(n) Employee Benefit Matters. Except as would not reasonably be expected to have,

either individually or in the aggregate, a Credit Union Material Adverse Effect: (i) each

"employee benefit plan" (within the meaning of Section 3(3) of the Employee Retirement

Income Security Act of 1974, as amended ("ERISA")) providing benefits to any current or

former employee, officer or director of the Credit Union or any member of its "Controlled

Group" (defined as any organization which is a member of a controlled group of corporations

within the meaning of Section 414 of the Internal Revenue Code of 1986, as amended (thc

"Code"» that is sponsored, maintained or contributed to by the Credit Union or any member of

its Controlled Group and for which the Credit Union or any member of its Controlled Group

would havc any liability, whether actual or contingent (each, a "Plan") has been maintained in

compliance with its terms and with the requirements of all applicable statutes, rules and

regulations, inclnding ERISA and the Code; (ii) with respect to each Plan subject to Title IV of

ERISA (including, for purposes of this clause (ii), any plan subject to Title IV of ERISA that the

Credit Union or any member of its Controlled Group previously maintained or contributed to in

the six years prior to the Signing Date), (A) no "reportable event" (within the meaning of

Section 4043(c) of ERISA), other than a reportable event for which the notice period referred to

in Section 4043(c) of ERISA has been waived, has occurred in the three years prior to the

Signing Date or is reasonably expected to occur, (B) no "accumulated funding deficiency"

(within the meaning of Section 302 of ERISA or Section 412 of the Code), whether or not

waived, has occurred in the three years prior to the Signing Date or is reasonably expected to

occur, (C) the fair market value of the assets under each Plan exceeds the present value of all

benefits accrued under such Plan (determined based on the assumptions used to fund such Plan)

and (D) neither the Credit Union nor any member of its Controlled Group has incurred in the six

years prior to the Signing Date, or reasonably expects to incur, any liability under Title IV or

ERISA (other than contributions to the Plan or premiums to the Pension Benefit Guaranty

Corporation in the ordinary course and without default) in respect of a Plan (including any Plan

that is a "rnultiemployer plan", within the meaning of Section 4001(c)(3) of ERISA); and

USTSequenceNo.1390 -13-

CS2QOO 11893227,I
(iii) each Plan that is intended to be qualified under Section 401(a) of the Code has received a

favorable determination letter from the Internal Revenue Service with respect to its qualified

status that has not been revoked, or such a determination letter has been timely applied for but

not received by the Signing Date, and nothing has occurred, whether by action or by failure to

act, which could reasonably be expected to cause the loss, revocation or denial of such qualified

status or favorable determination letter.

(0) Taxes. Except as would not, individually or in the aggregate, reasonably be

expected to have a Credit Union Material Adverse Effect, (i) the Credit Union and the Credit

Union Subsidiaries have filed all federal, state, local and foreign income and franchise Tax

returns (together with any schedules and attached thereto) required to be filed through the

Signing Date, subject to permitted extensions, and have paid all Taxes due thereon, (ii) all such

Tax returns (together with any schedules and attached thereto) are true, complete and correct in

all material respects and were prepared in compliance with all applicable laws and (iii) no Tax

deficiency has been determined adversely to the Credit Union or any of the Credit Union

Subsidiaries, nor does the Credit Union have any knowledge of any Tax deficiencies.

(p) Properties and Leases. Except as would not, individually or in the aggregate,

reasonably be expected to have a Credit Union Material Adverse Effect, the Credit Union and the

Credit Union Subsidiaries have good and marketable title to all real properties and all other

properties and assets owned by them, in each case free from liens (including, without limitation,

liens for Taxes), encumbrances, claims and defects that would affect the value thereof or

interfere with the use made or to be made thereof by them. Except as would not, individually or

in the aggregate, reasonably be expected to have a Credit Union Material Adverse Effect, the

Credit Union and the Credit Union Subsidiaries hold all leased real or personal property under

valid and enforceable leases with no exceptions that would interfere with the use made or to be

made thereof by them.

(q) Environmental Liability. Except as would not, individually or in the aggregate,

reasonably be expected to have a Credit Union Material Adverse Effect:

(i) there is no legal, administrative, or other proceeding, claim or action of

any nature seeking to impose, or that would reasonably be expected to result in the

imposition of, on the Credit Union or any Credit Union Subsidiary, any liability relating

to the release of hazardous substances as defined under any local, state or federal

environmental statute, regulation or ordinance. including the Comprehensive

Environmental Response, Compensation and Liability Act of 1980, pending or, to the

Credit Union's knowledge, threatened against the Credit Union or any Credit Union

Subsidiary;

(ii) to the Credit Union's knowledge, there is no reasonable basis for any such

proceeding, claim or action; and

(iii) neither the Credit Union nor any Credit Union Subsidiary is subject to any

agreement, order, judgment or decree by or with any court, Governmental Entity or third

party imposing any such environmental liability.

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(r) Risk Management Instruments. Except as would not, individually or in the

aggregate, reasonably be expected to have a Credit Union Material Adverse Effect, all derivative

instruments, including, swaps, caps, floors and option agreements, whether entered into for the

Credit Union's own account, or for the account of one or more of the Credit Union Subsidiaries

or its or their customers, were entered into (i) only in the ordinary course of business, (ii) in

accordance with prudent practices and in all material respects with all applicable laws, rules,

regulations and regulatory policies and (iii) with counterparties believed to be financially

responsible at the time; and each of such instruments constitutes the valid and legally binding

obligation of the Credit Union or one of the Credit Union Subsidiaries, enforceable in

accordance with its terms, except as may be limited by the Bankruptcy Exceptions. Neither the

Credit Union nor the Credit Union Subsidiaries, nor, to the knowledge of the Credit Union, any

other party thereto, is in breach of any of its obligations under any such agreement or

arrangement other than such breaches that would not, individually or in the aggregate,

reasonably be expected to have a Credit Union Material Adverse Effect.

(s) Agreements with Regulatory Agencies. Except as set forth on Schedule F, neither

the Credit Union nor any Credit Union Subsidiary is subject to any material cease-and-desist or

other similar order or enforcement action issued by, or is a party to any material written

agreement, consent agreement or memorandum of understanding with, or is a party to any

commitment letter or similar undertaking to, or is subject to any capital directive by, or since

December 31, 2006, has adopted any board resolutions at the request of, any Governmental

Entity that currently restricts in any material respect the conduct of its business or that in any

material manner relates to its capital adequacy, its liquidity and funding policies and practices, its

ability to pay dividends, its credit, risk management or compliance policies or procedures, its

internal controls, its management or its operations or business (each item in this sentence, a

"Regulatory Agreement"), nor has the Credit Union or any Credit Union Subsidiary been advised

since December 31, 2006, by any such Governmental Entity that it is considering issuing,

initiating, ordering, or requesting any such Regulatory Agreement. The Credit Union and each

Credit Union Subsidiary is in compliance in all material respects with each Regulatory

Agrccment to which it is party or subject, and neither the Credit Union nor any Credit Union

Subsidiary has received any notice from any Governmental Entity indicating that either the

Credit Union or any Credit Union Subsidiary is not in compliance in all material respects with

any such Regulatory Agreement.

(t) Insurance. The Credit Union and the Credit Union Subsidiaries are insured with

reputable insurers against such risks and in such amounts as the management ofthe Credit Union

reasonably has determined to be prudent and consistent with industry practice. The Credit Union

and the Credit Union Subsidiaries are in material compliance with their insurance policies and

are not in default under any of the material terms thereof, each such policy is outstanding and in

full force and effect, all premiums and other payments due under ally material policy have been

paid, and all claims thereunder have been filed in due and timely fashion, except, in each case, as

would not, individually or in the aggregate, reasonably be expected to have a Credit Union

Material Adverse Effect.

(u) Intellectual Property. Except as would not, individually or in the aggregate,

reasonably be expected to have a Credit Union Material Adverse Effect, (i) the Credit Union and

each Credit Union Subsidiary owns or otherwise has the right to use, all intellectual property

UST Sequence No. 1390

US2000 11gcJ3227,I

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rights, including all trademarks, trade dress, trade names, service marks, domain names, patents,

inventions, trade secrets, know-how, works of authorship and copyrights therein, that are used in

the conduct of their existing businesses and all rights relating to the plans, design and

specifications of any of its branch facilities ("Proprietary Rights"), free and clear of all liens and

any claims of ownership by current or former employees, contractors, designers or others and

(ii) neither the Credit Union nor any of the Credit Union Subsidiaries is materially infringing,

diluting, misappropriating or violating, nor has the Credit Union or any of the Credit Union

Subsidiaries received any written (or, to the knowledge of the Credit Union, oral)

communications alleging that any of them has materially infringed, diluted, misappropriated or

violated, any of the Proprietary Rights owned by any other person. Except as would not,

individually or in the aggregate, reasonably be expected to have a Credit Union Material Adverse

Effect, to the Credit Union's knowledge, no other person is infringing, diluting, misappropriating

or violating, nor has the Credit Union or any or the Credit Union Subsidiaries sent any written

communications since January 1, 2007, alleging that any person has infringed, diluted,

misappropriated or violated, any of the Proprietary Rights owned by the Credit Union and the

Credit Union Subsidiaries.

(v) Brokers and Finders. The Investor has no liability for any amounts that any

broker, finder or investment banker is entitled to for any financial advisory, brokerage, tinder's

or other fee or commission in connection with this Agreement or the transactions contemplated

hereby based upon arrangements made by or on behalf of the Credit Union or any Credit Union

Subsidiary.

(w) Disclosure Schedule. The Credit Union has delivered the Disclosure Schedule

and, if applicable, the Disclosure Update to the Investor and the information contained in the

Disclosure Schedule, as modified by the information contained in the Disclosure Update, if

applicable, is true, complete and correct,

ARTICLE IV

Covenants

Section 4,1 Affirmative Covenants. The Credit Union hereby covenants and agrees

with Investor that:

(a) Commcrciallv Reasonable Efforts. Subject to the terms and conditions of this

Agreement, each of the parties will use its commercially reasonable efforts in good faith to take,

or cause to be taken, all actions, and to do, or cause to he done, all things necessary, proper or

desirable, or advisable under applicable laws; so as to permit consummation of the Purchase as

promptly as practicable and otherwise to enable consummation of the transactions contemplated

hereby and shall use commercially reasonable efforts to cooperate with the other party to that

end.

(b) Certain Notifications until Closing. From the Signing Date until the Closing, the

Credit Union shall promptly notify the Investor of (i) any fact, event or circumstance of which it

is aware and which would reasonably be expected to cause any representation or warranty of the

Credit Union contained in this Agreement to be untrue or inaccurate in any material respect or to

cause any covenant or agreement of the Credit Union contained in this Agreement not to be

UST Sequence No. 1390

US2000 1189322/.1

-16-
complied with or satisfied in any material respect and (ii) except as Previously Disclosed, any

fact, circumstance, event, change, occurrence, condition or development of which the Credit

Union is aware and which, individually or in the aggregate, has had or would reasonably be

expected to have a Credit Union Material Adverse Effect; provided, however, that delivery of

any notice pursuant to this Section 4,I(b) shall not limit or affect any rights of or remedies

available to the Investor.

(c) Access, Information and Confidentialitv.

(i) From the Signing Date until the date when the Investor owns an amount of

Senior Subordinated Securities having an aggregate face value of less than 10% of the

Purchase Price, the Credit Union will permit the Investor and its agents, consultants,

contractors and advisors (x) acting through the Appropriate Supervisory Authority, or

otherwise to the extent necessary to evaluate, manage, or transfer its investment in the

Credit Union, to examine the Credit Union's books, Tax returns (including all schedules

and attached thereto) and other information reasonably requested by Investor relating to

Taxes and make copies thereof and to discuss the affairs, finances and accounts of the

Credit Union and the Credit Union Subsidiaries with the principal officers of the Credit

Union, all upon reasonahle notice and at such reasonable times and as often as the

Investor may reasonably request and (y) to review any information material to the

Investor's investment in the Credit Union provided by the Credit Union to its Appropriate

Supervisory Authority. Any investigation pursuant to this Section 4.I(c) shall be

conducted during normal business hours and in such manner as not to interfere

unreasonably with the conduct of the business of the Credit Union, and nothing herein

shall require the Credit Union or any Credit Union Subsidiary to disclose any information

to the Investor to the extent (A) prohibited by applicable law or regulation, or (B) that

such disclosure would reasonably be expected to cause a violation of any agreement to

which the Credit Union or any Credit Union Subsidiary is a party or would cause a risk of

a loss of privilege to the Credit Union or any Credit Union Subsidiary (provided that the

Credit Union shall use commercially reasonable efforts to make appropriate substitute

disclosure arrangcmcnts under circumstances where the restrictions in this clause (i)

apply),

(ii) From the Signing Datc until the date on which all of the Senior

Subordinated Securities have been redeemed in whole, the Credit Union will deliver, or

will cause to be delivered, to the Investor:

(A) as soon as available after the end of each fiscal year of the Credit

Union, and in any event within 90 days there after, a consolidated balance sheet of

the Credit Union as ofthe end of such fiscal year, and consolidated statements of

income, retained earnings and cash flows of the Credit Union for such year, in

eaeh case prepared in aecordance with GAAP or RAP, as applicable, and setting

forth in each case in comparative form the figures for the previous fiscal year of

the Credit Union and which shall be audited to the extent audited financial

statements are available;

UST Sequence No. 1390

US2000 11893227.1

-17-
(B) as soon as available after the end of the first, second and third

quarterly periods in each fiscal year of the Credit Union, a copy of any quarterly

reports provided to Interest Holders of the Credit Union or Credit Union

management by the Credit Union;

(C) as soon as available after the Credit Union receives any assessment

ofthe Credit Union's internal controls, a copy ofsuch assessment;

(D) annually on a date specified by the Investor, a completed survey, in

a form specified by the Investor, providing, among other things, a description of

how the Credit Union has utilized the funds the Credit Union received hereunder

in connection with the sale of the Senior Subordinated Securities and the effects

ofsuch funds on the operations and status ofthe Credit Union;

(E) as soon as such items become effective, any amendments to the

Charter, bylaws or other organizational documents ofthe Credit Union; and

(F) at the same time as such items are sent to all Members of the

Credit Union, copies of any information or documents, excluding any general

solicitations or advertisements for services and products, sent by the Credit Union

to its Members.

(iii) The Investor will use reasonable best efforts to hold, and will use

reasonable best efforts to cause its agents, consultants, contractors and advisors and

United States executive branch officials and employees, to hold, in confidence all

non-public records, books, contracts, instruments, computer data and other data and

information (eollectively, "InformationY concerning the Credit Union furnished or made

available to it by the Credit Union or its representatives pursuant to this Agreement

(except to the extent that such information can be shown to have been (A) previously

known by such party on a non-confidential basis. (B) in the public domain through no

fault of such party or (C) later lawfully acquired from other sources by the party to which

it was furnished (and without violation of any other confidentiality obligation)); provided

that nothing herein shall prevent the Investor from disclosing any Information to the

extent required by applieable laws or regulations or by any subpoena or similar legal

process. The Investor understands that the Information may contain commercially

sensitive confidential information entitled to an exception 11'Oln a Freedom ofInformation

Act request.

(iv) The Investor's information rights pursuant to Section 4.I(c)(ii)(A), (B),

(C), (E) and (F) and the Investor's right to receive certifications from the Credit Union

pursuant to Section 4.I(d)(ii) may be assigned by the Investor to a transferee or assignee

ofthe Senior Subordinated Securities with a face value of no less than an amount equal to

2% ofthe Purchase Price.

(v) From the Signing Date until the date when the Investor no longer owns

any Senior Subordinated Securities, the Credit Union shall permit, and shall cause each

of the Credit Union's Subsidiaries to permit (A) the Investor and its agents, consultants,

UST Sequence No. 1390

US2000 11893227.1

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contractors and advisors, (B) the Special Inspector General of the Troubled Asset Relief

Program, and (C) the Comptroller General of the United States access to personnel and

any books, papers, records or other data, in each case, to the extent relevant to

ascertaining compliance with the financing terms and conditions; provided that, prior to

disclosing any information pursuant to clause (B) or (C), the Special Inspector General of

the Troubled Asset Relief Program and the Comptroller General of the United States

shall have agreed, with respect to documents obtained under this Agreement in

furtherance of its function, to follow applicable law and regulation (and the applicable

customary policies and procedures) regarding the dissemination of confidential materials,

including redacting confidential information hom the public version of its reports and

soliciting the input from the Credit Union as to information that should be afforded

confidentiality, as appropriate.

(vi) Nothing in this Section shall be construed to limit the authority that the

Special Inspector General ofthe Troubled Asset Relief Program, the Comptroller General

ofthe United States or any other applicahle regulatory authority has under law.

(d) CDFI Requircments.

(i) From the Signing Date until the date on which all of the Senior

Subordinated Securities have been redeemed in whole, the Credit Union shall (A) be

certified by the Fund as a CDFI; (B) together with all of its Affiliates collectively meet

the eligibility requirements of 12 C.F.R. 1805.200(b); (C) have a primary mission of

promoting community development, as may be determined by Investor from time to time,

based on criteria set forth in 12 C.F.R. l805.201(b)(I); (D) provide Financial Products,

Development Services, and/or other similar financing as a predominant business activity

in arm's-length transactions: (E) serve a Target Market by serving one or more

Investment Areas and/or Targeted Populations as may be determined by Investor from

time to time, substantially in the manner set forth in 12 C.F.R. 1805.201(b)(3);

(F) provide Development Services in conjunction with its Financial Products, directly,

through an Affiliate or through a contract with a third-party provider; (G) maintain

accountability to residents of the applicable Investment Area(s) or Targeted Population(s)

through representation on its govcming Board of Directors or otherwise; and (I-I) remain

a non-governmental entity which is not an agency or instrumentality of the United States

of America. or any State or political subdivision thereof: as described in 12 C.F.R.

1805.20 I(b)(6) and within the meaning of any supplemental regulations or interpretations

of 12 C.F.R. 1805.20 I(b)(6) or such supplemental regulations published by the Fund.

Notwithstauding any other provision hereof. as used in this Section 4.1 (d), the terms

"Affiliates"; "Financial Products"; "Development Services"; "Target Market";

"Investment Areas"; and "Targeted Populations" have the meanings ascribed to such

terms in 12 C.F.R. 1805.104.

(ii) From the Signing Date until the date on which all of the Senior

Subordinated Securities have been redeemed in whole, the Credit Union shall deliver to

Investor (I) (x) on the date that is 180 days after the Closing Date and (y) annually on the

same date on which the Credit Union delivers the documentation required under

Section 4.I(c)(ii), (A) to the Investor, a certificate signed on behalf of the Credit Union

UST Sequence No. 1390

\)S2000 11893227.1

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by a Senior Executive Officer, in substantially the form attached hereto as Annex F,

certifying (A) that the Credit Union remains in compliance with the covenants set forth in

Section 4. I(d)(i); (B) that the information in the CDFI Application, as modified by any

updates to the CDFI Application provided by the Credit Union to the Investor on or prior

to the date of such certificate, with respect to the covenants set forth in

Section 4.I(d)(i)(B) and Section 4. I(d)(i)(D) remains true, correct and complete as of

such date or, to the extent any information set forth in the CDn Application, as modified

by any updates to the CDFI Application provided by the Credit Union to the Investor on

or prior to the date ofsuch certificate, with respect to such covenants needs to be updated

or supplanted to make it true, complete and correct as of such date, that an updated

narrative to the CDFI Application setting forth any information necessary to make the

information set forth in the CDFI Application is true, complete and correct as of such

date; (C) either (a) that the contracts and material agreements entered into by the Credit

Union with respect to Development Services previously disclosed to the Investor remain

in effect or (b) that attached are any new contracts and material agreements entered into

by the Credit Union with respect to Development Services; (iv) a list of the names and

addresses of the individuals which comprise the Board of Directors as of such date and,

to the extent any ofsuch individuals was not a member ofthe Board of Directors as ofthe

last certification to the Investor, a narrative describing such individual's relationship to

the applicable Investment Area(s) and Targeted Population(s) or, if the Credit Union

maintains accountability to residents of the applicable Investment Area(s) or Target

Population(s) through means other than representation on its governing Board of

Directors and such means have changed since the date of the last certification to the

Investor, a narrative describing such change and (v) that the Credit Union is not an

agency of the United States of America, or any State or political subdivision thereof, as

described in 12 C.F.R. 1805.201(b)(6) and within the meaning of any supplemental

regulations or interpretations of 12 C.F.R. 1805.201 (b)(6) or such supplemental

regulations published by the Fund and (2) within five (5) business days of receipt, copies

of any notices, correspondence or other written communication between the Credit Union

and the Fund, including any form the Credit Union is required to provide to the Fund due

to the occurrence of a "Material Event" within the meaning of the Fund's CDFI

Certification Procedures.

(iii) The Credit Union shall immediately notify the Investor upon the

occurrence of any breach of any ofthc covenants set forth in Section 4.1(d).

(iv) If at any time the Credit Union is no longer certified as a CDFI, but one or

more Affiliates thereof arc certified as CDFls (such affiliates, the "Certified Entities"),

the Credit Union shall (A) immediately notify the Investor of such status, (B) cause the

Certified Entities to comply with the covenants set forth in Section 4.1(d)(i), (C) on an

annual basis pursuant to Section 4.1(d)(ii), deliver to Investor, the certificates and

documentation required by clauses (A), (B) and (C) in Section 4.1(d)(ii)(I)(y), with

respect to the Certified Entities and (D) execute and deliver to Investor such amendments

or documents or perform such other acts as the Investor may deem necessary, in its sole

discretion, for the Credit Union and the Certified Entities to comply with the terms and

conditions ofthis Agreement.

UST Sequence No. 1390

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(e) Executive Compensation.

(i) Benefit Plans. During the Relevant Period, the Credit Union shall take all

necessary action to ensure that the Benefit Plans of the Credit Union and its Affiliates

comply in all respects with, and shall take all other actions necessary to comply with,

Section III of EESA as implemented by the Compensation Regulations, and neither the

Credit Union nor any of its Affiliates shall adopt any new Benefit Plan (x) that does not

comply therewith or (y) that does not expressly state and require that such Benefit Plan

and any compensation thereunder shall be subject to any relevant Compensation

Regulations adopted, issued or released on or after the date any such Benefit Plan is

adopted. To the extent that EESA and/or the Compensation Regulations are amended or

otherwise change during the Relevant Period in a manner that requires changes to thenexisting Benefit Plans, or that requires other actions, the Credit Union and its Affiliates

shall effect such changes to its or their Benefit Plans, and take such other actions, as

promptly as practicable after it has actual knowledge of such amendments or changes in

order to be in compliance with this Section 4.I(e) (and shall be deemed to be in

compliance for a reasonable period to effect such changes). In addition, the Credit Union

and its Affiliates shall take all necessary action, other than to the extent prohibited by

applicable law or regulation applicable outside of the United States, to ensure that the

consummation of the transactions contemplated by this Agreement will not accelerate the

vesting, payment or distribution of any deferred cash awards or any nonqualified deferred

compensation payable by the Credit Union or any ofits Affiliates.

(ii) Additional Waivers. After the Closing Date, in connection with the hiring

or promotion of a Section 4.I(e) Employee and/or the promulgation of applicable

Compensation Regulations or otherwise, to the extent any Section 4.1(e) Employee shall

not have executed a waiver in a form satisfactory to the Investor with respect to the

application to such Section 4.1 (e) Employee ofthe Compensation Regulations, the Credit

Union shall use its best efforts to (x) obtain from sucb Section 4.I(e) Employee a waiver

in substantially the form attached hereto as Annex C and (y) deliver such waiver to the

Investor as promptly as possible, in each case within sixty days of such Section 4.I(e)

Employee's becoming subject to the requirements of this section. "Section 4.1(e)

Employee" means (A) each Senior Executive Officer and (B) any other employee of the

Credit Union or any of its Affiliates determined at any time to be subject to Section III

of EESA as implemented by the Compensation Regulations.

(iii) Clawback. In the event that any Section 4.I(e) Employee receives a

payment in eontravcntion of the provisions of this Section 4.1(e), the Credit Union shall

promptly provide such individual with written notice that the amount of such payment

must be repaid to the Credit Union in full within fifteen business days following receipt

of such notice or such earlier time as may be required by the Compensation Regulations

and shall promptly inform the Investor (x) upon discovering that a payment in

contravention ofthis Section 4.I(e) has been made and (y) following the repayment to the

Credit Union of such amount, and shall take such other actions as may be necessary to

comply with the Compensation Regulations.

UST Sequence No. 1390

US2000 11893227.1

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(iv) Limitation on Deductions. During the Relevant Period, the Credit Union

agrees that it shall not claim a deduction for remuneration for federal income tax

purposes in excess of $500,000 for each Senior Executive Officer that would not be

deductible if Section 162(m)(5) ofthe Code applied to the Credit Union.

(I) Payment of Principal and Interest. The Credit Union covenants and agrees for the

benefit of the Holders of the Senior Subordinated Securities that it will duly and punctually pay

or cause to be paid the principal of and interest on the Senior Subordinated Securities at the

respective times and in the manner provided herein. Payment of the principal of and interest on

the Senior Subordinated Securities due on the Maturity Date will be made by the Credit Union in

immediately available funds against presentation and surrender of the Senior Subordinated

Securities. Each installment of interest on the Senior Subordinated Securities due on an Interest

Payment Date other than the Maturity Date shall be paid by wire transfer of immediately

available funds to any account with a banking institution located in the United States designated

by such Holder no later than the related Regular Record Date.

(g) HAMP Modifications. The Credit Union shall take all necessary action to ensure

that (i) from and after the date the Credit Union or any Credit Union Subsidiary that services

residential mortgage loans has 100 or more residential mortgage loans not owned or guaranteed

by Fannie Mae or Freddie Mac which have been past due for 60 or more days, the Credit Union

or such Credit Union Subsidiary shall, to the extent such programs are open for participation,

(A) participate in the United States Department of the Treasury's Making Home Affordable

CMHA") program, including MIlA's Second Lien Modification Program and (B) immediately

execute a Commitment to Purchase Financial Instrument and Servieer Participation Agreement

(in such form as may be set forth on the MHA website at wViw.hmpadmin.com from time to

time) with Fannie Mae (acting as the United States Department of the Treasury's fiscal agent)

and (ii) if the Credit Union or any Credit Union Subsidiary owns mortgage loans that are

serviced by a non-affiliated mortgage servicer, the Credit Union or such Credit Union Subsidiary

shall consent to any MHA modification request made by such mortgage servicer.

(h) Predominantlv Financial. For as long as the Investor owns any Senior

Subordinated Securities, the Credit Union, agrees to remain predominantly engaged in financial

activities. A entity is predominantly engaged in financial activities if the annual gross revenues

derived by the entity and all subsidiaries of the entity (excluding revenues derived hom

subsidiary depository institutions), on a consolidated basis, from engaging in activities that are

financial in nature or are incidental to a financial activity under subsection (k) of Section 4 of the

Bank Holding Company Act of 1956 (12 U.S.c. I 843(k» represent at least 85 percent of the

consolidated annual gross revenues ofthe entity.

(i) Capital Covenant. From the Signing Date until the date on which all of the Senior

Subordinated Securities have been redeemed in whole, the Credit Union and the Credit Union

Subsidiaries shall maintain such capital as may bc necessary to meet the minimum capital

requirements ofthe Appropriate Supervisory Authority, as in effect hom time to time.

(i) Compliance with Employ American Workers Act. The Credit Union shall agree

to comply, and take all necessary action to ensure that any Credit Union Subsidiary complies, in

all respects with the provisions of EESA and any federal law respecting EESA, including the

UST Sequence No. 1390

US2ll00 j 1893227.1

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Employ American Workers Act (Section 1611 of Division A, Title XVI of the American

Recovery and Reinvestment Act of 2009), Public Law No. II I -5, effective as of February 17,

2009, as implemented by any rules, regulation or guidance thereunder, as such may be amended

or supplemented from time to time, and any applicable guidance ofthe United States Department

ofthe Treasury with respect thereto.

Section 4.2 N~@tive Covenants. The Credit Union hereby covenants and agrees with

the Investor that:

(a) Certain Transactions. The Credit Union shall not merge or consolidate with, or

sell, transfer or lease all or substantially all of its property or assets to, any other party unless the

successor, transferee or lessee party (or its ultimate parent entity), as the case may be (if not the

Credit Union), expressly assumes the due and punctual performance and observance of each and

every covenant, agreement and condition of this Agreement to be performed and observed by the

Credit Union.

(b) Restriction on Dividends and Repurchases.

(i) Prior to the date on which all of the Senior Subordinated Securities have

been redeemed in whole, neither the Credit Union nor any Credit Union Subsidiary shall,

redeem, purchase, repay or acquire any equity or debt capital instruments of any kind of

the Credit Union or any Credit Union Subsidiary, other than (A) maturing secondary

capital accounts (for the avoidance of doubt, only with respect to amounts mandatorily

then due and payable pursuant to the terms of the instrument thereof with respect to such

secondary capital accounts and not any changes in regulatory treatment) or

(B) redemptions, purchases, repayments or other acquisitions of Capital Interests or other

securities of any kind of the Credit Union or any Credit Union Subsidiary required

pursuant to binding contractual agreements entered into prior to October 21, 2009 or (C)

good faith transactions in the ordinary course of business involving Member Shares,

unless all accrued and unpaid interest for all past interest periods on the Senior

Subordinated Securities is paid in full. For purposes of this Section 4.2(blei), the term

"secondary capital account" shall have the meaning ascribed to such term in

Section 701.34(b)(6) of the NCUA Regulations or shall mean any comparable instrument

authorized by applicable state regulations, as applicable.

(ii) Notwithstanding anything contained in this Section 4.2(b), prior to the

date on which all of the Senior Subordinated Securities have been redeemed in whole, no

Additional Dividends may be declared or paid on any Capital Interests or other capital

instruments of any kind of the Credit Union or any Credit Union Subsidiary. The term

"Additional Dividends" shall mean special dividends paid on Capital Interests or other

capital instruments of any kind of the Credit Union or any Credit Union Subsidiary in

excess of dividends paid at the stated market dividend rates on share accounts and other

deposit liabilities ofthe Members and the stated interest or dividend rates payable on any

other capital instruments ofthe Credit Union or any Credit Union Subsidiary.

(c) Related Party Transactions. Until such time as the Investor ceases to own any

debt or equity securities of the Credit Union, including the Senior Subordinated Securities, the

UST Sequence No. 1390

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Credit Union and the Credit Union Subsidiaries shall not cuter into transactions with Affiliates or

related persons (within the meaning of Item 404 under the SEC's Regulation S-K) unless

(A) such transactions are on terms no less favorable to the Credit Union and the Credit Union

Subsidiaries than could be obtained from an unaffiliated third party, and (B) have been approved

by the audit committee of the Board of Directors or comparable body of independent directors of

the Credit Union, or if there are no independent directors. the Board of Directors, provided that

the Board of Directors shall maintain written documentation which supports its determination

that the transaction meets the requirements of clause (A) ofthis Section 4.2( c).

(d) Restriction on Repurchase of Senior Subordinated Securities Not Held bv

Investor. Prior to the date on which the Investor no longer owns any Senior Subordinated

Securities, the Credit Union shall not repurchase, redeem, call or otherwise reacquire any Senior

Subordinated Securities from any Holder thereof, whether by means of open market purchase,

negotiated transaction, or otherwise, unless it offers to repurchase, redeem, call or otherwise

reacquire a ratable portion ofthe Senior Subordinated Securities then held by the Investor on the

same terms and conditions.

ARTICLE V

Remedies of the Holders upon Event of Default

Section 5.1 Event of Default. "Event of Default" shall mean the occurrence or

existence of anyone or more ofthe following:

(a) Receivership or Conservatorship.

(i) There shall be appointed a receiver, conservator, liquidator, assignee,

custodian, trustee, sequestrator or other similar official of the Credit Union or for any

substantial part of its property, and such appointment shall remain unstaycd and in effect

for a period ofsixty (60) days;

(ii) The Credit Union shall consent to the appointment of a receiver,

conservator, liquidator, assignee, custodian, trustee, seq uesrrator or other similar official

for it or all or substantially all of its property in any liquidation, insolvency or similar

proceeding with respect to it or all or substantially all of its property.

(b) Dissolution. Any order, judgment or decree is entered against the Credit Union or

a Credit Union Subsidiary decreeing the dissolution or split-up of the Credit Union or a Credit

Union Subsidiary and such order remains undischarged or unstayed for a period in excess of

thirty (30) days.

Section 5.2 Acceleration and Other Remedies. When any Event of Default has

occurred and is continuing, then the Senior Subordinated Securities, including both principal and

interest, and all fees, charges and other obligations payable hereunder and under the Transaction

Documents, shall immediately become due and payable without presentment, demand, protest or

notice of any kind. In addition, the Holders may exercise any and all remedies available to it

under the Transaction Documents or applicable law.

UST Sequence No. 1390

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Section 5.3 Suits for Enforcement. In case anyone or more Events of Default shall

have occurred and be continuing, unless such Events of Default shall have been waived in the

manner provided in Section 5.5 hereof, the Holders holding more than fifty percent (50%) ofthe

aggregate outstanding principal ,U110unt of the Senior Subordinated Securities (the "Majority

Holders"), subject to the terms of Article VI hereof, may proceed to protect and enforce their

rights under this Article V by suit in equity or action at law. It is agreed that in the event ofsuch

action, or any action between the Holders of the Senior Subordinated Securities and the Credit

Union (including its officers and agents) in connection with a breach or enforcement of this

Agreement, the Holders of the Senior Subordinated Securities shall be entitled to receive all

reasonable fees, costs and expenses incurred, including without limitation such reasonable fees

and expenses of attorneys (whether or not litigation is commenced) and reasonable fees, costs

and expenses of appeals.

Section 5.4 Holders May File Proofs of Claim. In case there shall be pending

proceedings for the bankruptcy or for the reorganization of any obligor on the Senior

Subordinated Securities (otber than the Credit Union) under Title 11, United States Code, or any

other applicable law, or in case a receiver, conservator or trustee shall have been appointed for

the Credit Union or such other obligor (each, an "Obligor") or a Significant Subsidiary, or in the

case of any other similar judicial proceedings relative to an Obligor or a Significant Subsidiary,

or to tbe creditors or property of an Obligor or a Significant Subsidiary, any Holder, irrespective

of whether the principal of the Senior Subordinated Securities shall then be due and payable as

therein expressed or by declaration or otherwise and irrespective of whether any such Holder

shall have made any demand pursuant to the provisions of this Section 5.4, shall be entitled and

empowered, by intervention in such proceedings or otherwise, to file and prove a claim or claims

for the whole amount of principal and interest owing and unpaid in respect of the Senior

Subordinated Securities held by any such Holder and, in case of any judicial proceedings, to file

such proofs of claim and other papers or documents as may be necessary or advisable in order to

have the claims of any such Holder allowed in such judicial proceedings relative to an Obligor or

a Significant Subsidiary, or to the creditors or property of an Obligor, unless prohibited by

applicable law and regulations, to vote in any election of a trustee or a standby trustee in

arrangement, reorganization, liquidation or other bankruptcy or insolvency proceedings or person

performing similar functions in comparable proceedings, and to collect and receive any moneys

or other property payable or deliverable to any such Holder on any such claims.

Section 5.5 Waiver of Past Defaults. The Holders of not less than a majority in

aggregate principal amount of the outstanding Senior Subordinated Securities may on behalf of

tbe Holders of all the Senior Subordinated Securities waive any past default hereunder with

respect such Senior Subordinated Securities and its consequences. Upon any such waiver, such

default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have

been cured, for every purpose of this Agreement; but no such waiver shall extend to any

subsequent or other default or impair any right consequent thereon.

ARTICLE VI

Additional Agreements

Section 6.1 Purchase for Investment. The Investor acknowledges that the Senior

Subordinated Securities have not been registered under the Securities Act, or uncler any state

UST Sequence No. 1390 -25-

US200011893227.1
securities laws. The Investor acknowledges that the Senior Subordinated Securities are not being

sold pursuant to an indenture (an "Indcnture") qualified under the Trust Indenture Act of 1939,

as amended (the "Indenture Act"). The Investor (a) is acquiring the Senior Subordinated

Securities pursuant to an exemption from registration under the Securities Act and an exemption

from qualification of an indenture under the Indenture Act, and is acquiring the Senior

Subordinated Securities solely for investment with no present intention to distribute them to any

person in violation of the Securities Act or any applicable U.S. state securities laws, (b) will not

sell or otherwise dispose of lily ofthe Senior Subordinated Securities, except in compliance with

the registration requirements or exemption provisions of the Securities Act and any applicable

U.S. state securities laws, and (c) has such knowledge and experience in financial and business

matters and in investments of this type that it is capable of evaluating the merits and risks of the

Purchase and of making an informed investment decision.

Section 6.2 Form of Senior Subordinated Securitv. The Senior Subordinated Security

shall be substantiaIIy in the form of Annex A hereto, the terms of which are incorporated in and

made a part of this Agreement. The Senior Subordinated Securities shaII be issued, and may be

transferred, only in denominations having an aggregate principal amount of not less than $1,000

and integral multiples of $1,000 in excess thereof. The Senior Subordinated Securities shaII be

in registered form without coupons and shaIl be numbered, lettered or otherwise distinguished in

such manner or in accordance with such plans as the officers executing the same may determine

as evidenced by the execution thereof.

Section 6.3 Execution of Senior Subordinated Securities. The Senior Subordinated

Securities shaII be executed in the name and on behalf of the Credit Union by the manual or

facsimile signature of its President, Chief Executive Officer, Chief Financial Officer or one of its

Executive Vice Presidents under its seal (if IegaIIy required) which may be affixed thereto or

printed, engraved or otherwise reproduced thereon, by facsimile or otherwise, and which need

not be attested, unless otherwise required by the Credit Union's Charter or bylaws or applicable

law. Every Senior Subordinated Security shall be dated the date of its execution and delivery.

Section 6.4 Computation of Interest. (a) The amount of interest payable for any

Interest Period (as defined below) will be computed as provided in the Senior Subordinated

Securities.

(b) Each Senior Subordinated Security will bear interest at the Interest Rate (i) in the

case ofthe initial Interest Period, for the period from. and including, the date of original issuance

of such Senior Subordinated Security to, but excluding, the initial Interest Payment Date and

(ii) thereafter, for the period from, and including, the first day following the end of the preceding

Interest Period to, but excluding, the applicable Interest Payment Date or, in the case of the last

Interest Period, the Maturity Date (each such period, an "interest I'eriodv. on the principal

thereof, on auy overdue principal and (to the extent that payment of such interest is enforceable

under applicable law) on any overdue installment of interest (including Defaulted Interest),

payable on each Interest Payment Date or the Maturity Date, as the case may be. Interest on any

Senior Subordinated Security that is payable, and is punctually paid or duly provided for by the

Credit Union, on any Interest Payment Date shall be paid to the person in whose name such

Senior Subordinated Security is registered at the close of business on the Regular Record Date

for such interest installment.

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(c) (i) Any interest on the Senior Subordinated Securities that is payable, but is not

punctually paid or duly provided for by the Credit Union, on any Interest Payment Date (herein

called "Defaulted Interest") shall forthwith cease to be payable to the Holder on the relevant

Regular Record Date, and such Defaulted Interest shall be paid by the Credit Union on either the

next sueceeding Interest Payment Date or another date specified by the Credit Union to the

persons in whose names such Senior Subordinated Securities are registered at the close of

business on either (x), if such Defaulted Interest is to be paid on the next succeeding Interest

Payment Date, the related Regular Record Date, or (y), if such Defaulted Interest is to be paid on

any other date, a special record date for the payment of such Defaulted Interest. To the extent

any Defaulted Interest is paid by the Credit Union, the Credit Union shall notify the Holder in

writing of the amount of Defaulted Interest proposed to be paid on each such Senior

Subordinated Securi ty and the date ofthe proposed payment.

(ii) To the extent that Defaulted Interest is to be paid on a date other than on

an Interest Payment Date, the Board of Directors shall fix a special record date for the

payment of such Defaulted Interest, which shall not be more than 15 nor less than 10

days prior to the date of the proposed payment. The Credit Union shall cause notice of

the proposed payment ofsuch Defaulted Interest and the special record date therefor to be

mailed, first class postage prepaid, to each Holder of a Senior Subordinated Security at

his, her or its address as it appears in the Senior Subordinated Securities Register, not less

than 10 days prior to such special record date. Notice of the proposed payment of such

Defaulted Interest and the special record date therefor having been mailed as aforesaid,

such Defaulted Interest shall be paid to the person in whose name such Senior

Subordinated Security is registered at the close of business on such special record date

and thereafter the Credit Union shall have no further payment obligation in respect of the

Defaulted Interest.

(d) The Credit Union may make payment of any Defaulted Interest on the Senior

Subordinated Securities in any other lawful manner not inconsistent with the requirements of any

securities exchange on which such Senior Subordinated Securities may be listed, and upon such

notice as may be required by such exchange.

(e) Subject to the foregoing provisions of this Section 6.4, each Senior Subordinated

Security delivered under this Agreement upon registration of transfer of or in exchange for or in

lieu of any other Senior Subordinated Security shall carry the rights to interest accrued and

unpaid, and to accrue, that were carried by such other Senior Subordinated Security.

Section 6.5 Legends. (a) The Investor agrees that all certificates or other instruments

representing the Senior Subordinated Securities will bear a legend substantially to the following

effect:

"THIS SENIOR SUBORDINATED SECURITY WILL BE ISSUED AND MAYBE

TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF $1,000 AND

MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER

OF SUCH SECURITIES IN A DENOMINATION OF LESS THAN $1,000 AND

MULTIPLES OF $1,000 IN EXCESS THEREOF SHALL BE DEEMED TO BE VOID

AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED

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TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH

SECURITIES FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE

RECEIPT OF PAYMENTS ON SUCH SECURITIES, AND SUCH PURPORTED

TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN

SUCH SECURITIES.

THIS SECURITY IS SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN

THE LETTER AGREEMENT BY AND BETWEEN THE CREDIT UNION AND THE

UNITED STATES DEPARTMENT OF THE TREASURY AND SECURITIES

PURCHASE AGREEMENT - STANDARD TERMS (THE "AGREEMENT'), EACH

OF WHICH ARE INCORPORATED INTO THIS SENIOR SUBORDINATED

SECURITY.

THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT

INSURED BY THE UNITED STATES, ANY AGENCY OR FUND OF THE

UNITED STATES OR THE NATIONAL CREDIT UNION SHARE INSURANCE

FUND.

THIS OBLIGATION IS SUBORDINATED AND JUNIOR IN RIGHT OF PAYMENT,

AS TO PRINCIPAL, INTEREST AND PREMIUM, TO ALL CLAIMS AGAINST THE

CREDIT UNION HAVING THE SAME PRIORITY AS SAVINGS ACCOUNT

HOLDERS, SHAREHOLDERS OR OTHER DEPOSITORS, THE NATIONAL

CREDIT UNION SHARE INSURANCE FUND OR ANY HIGHER PRIORITY,

INCLUDING GENERAL AND SECURED CREDITORS OF THE CREDIT UNION.

THIS OBLIGATION IS NOT SECURED BY THE CREDIT UNION'S ASSETS OR

THE ASSETS OF ANY OF ITS AFFILIATES. THIS OBLIGATION IS NOT

ELIGIBLE AS COLLATERAL FOR ANY LOAN BY THE CREDIT UNION.

THE TERMS UNDER WHICH THE CREDIT UNION MAY PREPA Y THIS SENIOR

SUBORDINATED SECURITY ARE SET FORTH IN THE AGREEMENT.

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT

OF 1933, AS AMENDED (THE "SECURITIES ACT'), OR THE SECURITIES LAWS

OF ANY STATE AND MAY NOT BE TRANSFERRED. SOLD OR OTHERWISE

DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT RELATING

THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE

SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION

UNDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF THIS SECURITY

IS NOTIFIED THAT THE SELLER MAYBE RELYING ON THE EXEMPTION

FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A

THEREUNDER. ANY TRANSFEREE OF THIS SECURITY BY ITS ACCEPTANCE

HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER"

(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT

IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES

REPRESENTED BY Tl-IIS INSTRUMENT EXCEPT (A) PURSUANT TO A

REGISTRATION STATEMENT WHICH IS THEN EFFECTIVE UNDER THE

SECURITIES ACT, (B) FOR SO LONG AS THE SECURITIES REPRESENTED BY

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THIS INSTRUMENT ARE ELIGIBLE FOR RESALE PURSUANT TO RULE l44A,

TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL

BUYER" AS DEFINED IN RULE I44A UNDER THE SECURITIES ACT THAT

PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A

QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE

TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE CREDIT

UNION OR (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM

THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND

(3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS

SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF

THIS LEGEND.

THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON

TRANSFER AND OTHER PROVISIONS OF THE AGREEMENT BETWEEN THE

CREDIT UNION AND THE INVESTOR REFERRED TO THEREIN, A COPY OF

WHICH IS ON FILE WITH THE CREDIT UNION. THIS SECURITY MA Y NOT BE

SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID

AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH

SAID AGREEMENT WILL BE VOID."

(b) In the event that any Senior Subordinated Securities (i)(A) become registered

under the Securities Act or (B) are eligible to be transferred without restriction in accordance

with Rule 144 or another exemption from registration under the Securities Act (other than Rule

144A), and (ii)(A) become subject to an Indenture qualified under the Indenture Act or (B) are

exempt from qualification under the Indenture Act, the Credit Union shall issue new certificates

or other instruments representing such Senior Subordinated Securities, which shall not contain

the applicable legends in Section 6.5(a) above; provided that the Investor surrenders to the Credit

Union the previously issued certificates or other instruments.

Section 6.6 Transfer of Senior Subordinated Securities. (a) The Credit Union or its

duly appointed agent shall maintain a register (the "Senior Subordinated Securities Register") for

the Senior Subordinated Securities in which it shall register the issuance and transfer of the

Senior Subordinated Securities. All transfers of the Senior Subordinated Securities shall be

recorded on the Senior Subordinated Securities Register maintained by the Credit Union or its

agent and the Credit Union shall be entitled to regard the registered Holder of such Senior

Subordinated Security as the actual owner ofthe Senior Subordinated Security so registered until

the Credit Union or its agent is required to record a transfer ofsuch Senior Subordinated Security

on its Senior Subordinated Securities Register. The Credit Union or its agent shall, subject to

applicable securities laws, be required to record any such transfer when it receives the Senior

Subordinated Security to be transferred duly and properly endorsed by the registered Holder or

by its attorney duly authorized in writing.

(b) The Credit Union shall at any time, upon written request ofthe Holder ofa Senior

Subordinated Security and surrender ofthe Senior Subordinated Security for such purpose, at the

expense of the Credit Union, issue new Senior Subordinated Securities in exchange therefor in

such denominations of at least $1,000, as shall be specified by the Holder of such Senior

Subordinated Security, in an aggregate principal amount equal to the then unpaid principal

UST Sequence No. 1390

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amount of the Senior Subordinated Securities surrendered and substantially in the form of

Annex A, with appropriate insertions and variations, and bearing interest from the date to which

interest has been paid on the Senior Subordinated Security surrendered. All Senior Subordinated

Securities issued upon any registration of transfer of exchange pursuant to this Section 6.6(b)

shall be valid obligations of the Credit Union, evidencing the same debt, and entitled to the same

benefits under this Agreement, as the Senior Subordinated Securities surrendered upon such

registration of transfer or exchange.

(c) All Senior Subordinated Securities presented for registration of transfer or for

exchange or payment shall be duly endorsed by, or be accompanied by, a written instrument or

instruments of transfer in a form satisfactory to the Credit Union duly executed by the Holder or

such Holder's attorney duly authorized in writing.

(d) No service charge shall be incurred for any exchange or registration of transfer of

Senior Subordinated Securities, but the Credit Union may require payment of a sum sufficient to

cover any tax, fee or other governmental charge that may be imposed in connection therewith.

(e) Prior to due presentment for the registration of a transfer of any Senior

Subordinated Security, the Credit Union and any agent of the Credit Union may deem and treat

the person in whose name such Senior Subordinated Security is registered as the absolute owner

and Holder of such Senior Subordinated Security for the purpose of receiving payment of

principal of and interest on such Senior Subordinated Security and none of the Credit Union or

any agents ofthe Credit Union shall be affected by notice to the contrary.

(f) Subject to compliance with applicable securities laws, the Holder shall be

permitted to transfer, sell, assign or otherwise dispose of ("Transfer") all or a portion of the

Senior Subordinated Securities at any time, and the Credit Union shall take all steps as may be

reasonably requested by the lnvestor to facilitate the Transfer of the Senior Subordinated

Securities, including, without limitation, as set forth in Section 6.13; provided that the lnvestor

shall not Transfer any Senior Subordinated Securities if such transfer would require the Credit

Union to be subject to the periodic reporting requirements of Section 13 or 15(d) of the

Securities Exchange Act of 1934 (the "Exchange Act") and the Credit Union was not already

subject to such requirements. In furtherance of the foregoing, the Credit Union shall provide

reasonable cooperation to facilitate any Transfers of the Senior Subordinated Securities,

including, as is reasonable under the circumstances, by furnishing such information concerning

the Credit Union and its business as a proposed transferee may reasonably request (including

such information as is required by Section 4.1(c)(iv)) and making management of the Credit

Union reasonably available to respond to questions of a proposed transferee in accordance with

customary practice, subject in all cases to the proposed transferee agreeing to a customary

confidentiality agreement.

Section 6.7 Replacement of Senior Subordinated Securities. Upon receipt of evidence

reasonably satisfactory to the Credit Union of the loss, theft, destruction or mutilation of any

Senior Subordinated Security, and, in the case of any such loss, theft or destruction, upon

delivery of a bond of indemnity reasonably satisfactory to the Credit Union (provided that the

Investor or any institutional Holder of a Senior Subordinated Security may instead deliver to the

Credit Union an indemnity agreement in form and substance reasonably satisfactory to the Credit

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Union), or, in the case of any such mutilation, upon surrender and cancellation of the Senior

Subordinated Security, as the case may be, the Credit Union will issue a new Senior

Subordinated Security of like tenor, in lieu of such lost, stolen, destroyed or mutilated Senior

Subordinated Security.

Section 6,8 Cancellation. All Senior Subordinated Securities surrendered for the

purpose of payment, exchange or registration of transfer, shall be surrendered to the Credit

Union and promptly canceled by it, and no Senior Subordinated Securities shall be issued in lieu

thereof except as expressly permitted by any of the provisions of this Agreement. The Credit

Union shall destroy all canceled Senior Subordinated Securities.

Section 6.9 Depository Senior Subordinated Securities. Upon request by the Investor

at any time following the Closing Date, the Credit Union shall promptly enter into a depositary

arrangement, pursuant to customary agreements reasonably satisfactory to the Investor and with

a depositary reasonably acceptable to the Investor, pursuant to which the Senior Subordinated

Securities may be deposited.

Section 6.10 Redemption. (a) The Senior Subordinated Securities at the time

outstanding may be redeemed by the Credit Union at its option, subject to the approval of the

Appropriate Supervisory Authority, in whole or in part and subject to Section 6.10(e), at any

time and from time to time, out offunds legally available therefor, upon notice given as provided

in Section 6.10(d) below, on any Interest Payment Date (the "Redemption Date") at a redemption

price equal to the sum of (i) 100% of the principal amount thereof being called for redemption

(provided that, if less than all of the outstanding Senior Subordinated Securities arc then being

redeemed, such amount shall not be less than 20% of the Purchase Price) and (ii) any accrued

and unpaid interest.

(b) The redemption price for any Senior Subordinated Securities shall be payable on

the Redemption Date to the Holder of such Senior Subordinated Securities against surrender

thereof to the Credit Union or its agent. Interest shall be paid at the then applicable Interest Rate

from the date ofthe last Interest Payment Date up to but not including the Redemption Date.

(c) No Sinking Fund. The Senior Subordinated Securities will not be subject to any

mandatory redemption, sinking fund or other similar provisions. Holders of Senior Subordinated

Securities will have no right to require redemption or repurchase of any of the Senior

Subordinated Securities.

(d) Notice of Redemption. Notice of redemption of the Senior Subordinated

Securities shall be given by first-class mail, postage prepaid, addressed to the Holders of record

of the Senior Subordinated Securities to be redeemed at their respective last addresses appearing

on the Senior Subordinated Securities Register. Such mailing shall be at least 30 days and not

more than 60 days before the Redemption Date. Any notice mailed as provided in this

subsection shall be conclusively presumed to have been duly given, whether or not the Holder

receives such notice, but failure duly to give such notice by mail, or any defect in such notice or

in the mailing thereof, to any Holder of Senior Subordinated Securities designated for

redemption shall not affect the validity ofthe proceedings for the redemption of any other Senior

Subordinated Securities. Notwithstanding the foregoing, if Senior Subordinated Securities are

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issued in book-entry form through The Depository Trust Company or any other similar facility,

notice of redemption may be given to the Holders of Senior Subordinated Securities at such time

and in any manner permitted by such facility, Each notice ofrcdemption given to a Holder shall

state: (1) the Redemption Date; (2) the amount of Senior Subordinated Securities to be redeemed

by such Holder; (3) the redemption price; and (4) the place or places where such Senior

Subordinated Securities are to be surrendered for payment ofthe redemption price,

(e) Partial Redemption, The Credit Union may redeem less than all of the

outstanding Senior Subordinated Securities, provided that the amount called for redemption at

any time is not less than 20% of the amount of the outstanding principal amount of the Senior

Subordinated Securities, Subject to the provisions hereof, the Board of Directors or a duly

authorized committee thereof shall have full power and authority to prescribe the terms and

conditions upon which Senior Subordinated Securities shall be redeemed from time to time. If

less than the full aggregate principal amount of any Senior Subordinated Security is redeemed,

the Credit Union shall issue a new Senior Subordinated Security in the unredeemed aggregate

principal amount thereof without charge to the Holder thereof Senior Subordinated Securities

may be redeemed in part only on a pro rata basis and only in minimum denominations of $1,000

and integral multiples thereof.

(f) Effectiveness of Redemption. If notice of redemption has been duly given and if

on or before the Redemption Date specified in the notice all funds necessary for the redemption

have been deposited by the Credit Union, in trust for the pro rata benefit of the Holders of the

Senior Subordinated Securities called for redemption, with a bank or trust company doing

business in the Borough of Manhattan, The City of New York, and having a capital and surplus

of at least $500 million and selected by the Board of Directors, so as to be and continue to be

available solely therefor, then, notwithstanding that any Senior Subordinated Security so called

for redemption has not been surrendered for cancellation, on and after the Redemption Date

interest shall cease to accrue on the aggregate principal amount of such Senior Subordinated

Securities so called for redemption, the aggregate principal amount of such Senior Subordinated

Securities so called for redemption shall no longer be deemed outstanding and shall cease to bear

interest from and after the Redemption Date. All rights with respect to such Senior Subordinated

Securities (or the portion thereof so called for redemption) shall forthwith on such Redemption

Date cease and terminate, except only the right of the Holders thereof to receive the redemption

price payable on such redemption from such bank or trust company, without interest. Any funds

unclai rncd at the end of three years from the Redemption Date shall, to the extent permitted by

applicable law, be released to the Credit Union, after which time the Holders of such Senior

Subordinated Securities (or portion thereof so called for redemption) shall look only to the Credit

Union for payment ofthe redemption price ofsuch Senior Subordinated Securities.

(g) Status of Redeemed Securities. Senior Subordinated Securities that are redeemed,

repurchased or otherwise acquired by the Credit Union shall be cancelled and shall not thereafter

be re-issued by the Credit Union.

Section 6,11 Voting Rights.

(a) General. The Holders of Senior Subordinated Securities shall not have any voting

rights except as set forth below or as otherwise from time to time required by law.

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(b) Class Voting Rights as to Particular Matters. So long as any Senior Subordinated

Securities are outstanding, in addition to any other vote or consent of Interest Holders required

by law or by the Charter, but subject to any applicable State Restrictions, the vote or consent of

the Holders of at least 66 2/3% of the Senior Subordinated Securities at the time outstanding,

given in person or by proxy, either in writing without a meeting or by vote at any meeting of the

Holders of Senior Subordinated Securities called for the purpose in accordance with

Section 6.11 (d), shall be necessary for effecting or validating:

(i) Amendment of Senior Subordinated Securities. Any amendment,

alteration or repeal of any provision of this Agreement or of the form of the Senior

Subordinated Securities or the Charter (including, unless no vote on such merger or

consolidation is required by Section 6.11 (b)(ii) below, any amendment, alteration or

repeal by means of a merger, consolidation or otherwise) so as to adversely affect the

rights, preferences, privileges or voting powers ofthe Senior Subordinated Securities; or

(ii) Exchanges. Reclassifications, Mergers and Consolidations. Any

consummation of a binding exchange or reclassification involving the Senior

Subordinated Securities, or of a merger or consolidation of the Credit Union with another

entity, unless in each case (x) the Senior Snbordinated Securities remain outstanding or,

in the case of any such merger or consolidation with respect to which the Credit Union is

not the surviving or resulting entity, are converted into or exchanged for securities of the

surviving or resulting entity or its ultimate parent, and (y) such remaining Senior

Subordinated Securities outstanding or such securities, as the case may be, have such

rights, preferences, privileges and voting powers, and limitations and restrictions thereof,

taken as a whole, as are not materially less favorable to the Holders thereof than the

rights, preferences, privileges and voting powers, and limitations and restrictions thereof,

of Senior Subordinated Securities immediately prior to such consummation, taken as a

whole;

provided, however, that, for all purposes of this Section 6.11 (b), any increase in the amount of

the Senior Subordinated Securities, or the creation and issuance of any other Indebtedness of the

Credit Union, or any securities convertible into or exchangeable or exercisable for any Senior

Subordinated Securities, ranking senior to, equally with and/or subordinate to the Senior

Subordinated Securities with respect to the payment of interest (whether or not such interest

compounds) and the distribution of assets upon liquidation, dissolution or winding up of the

Credit Union. will not be deemed to adversely affect the rights, preferences, privileges or voting

powers, and shall not require the affirmative vote or consent of the Holders of outstanding

Senior Subordinated Securities.

(c) Changes after Provision for Redemption. No vote or consent of the Holders of

Senior Subordinated Securities shall be required pursuant to Section 6.11 (b) above if, at or prior

to the time when any such vote or consent would otherwise be required pursuant to such Section,

all outstanding Senior Subordinated Securities shall have been redeemed or shall have been

called for redemption upon proper notice and sufficient funds shall have been deposited in trust

for such redemption, in each case pursuant to Section 6.10 above.

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(d) Procedures for Voting and Consents. The rules and procedures for calling and

conducting any meeting of the Holders of Senior Subordinated Securities (including, without

limitation, the fixing of a record date in connection therewith), the solicitation and usc of proxies

at such a meeting, the obtaining of written consents and any other aspect or matter with regard to

such a meeting or such consents shall be governed by any rules of the Board of Directors or any

duly authorized committee of the Board of Directors, in its discretion, may adopt from time to

time, which rules and/or procedures shall conform to the requirements ofthe Charter, the bylaws,

and applicable law and the rules of any national securities exchange or other trading facility on

which the Senior Subordinated Securities are listed or traded at the time.

Section 6.12 Secondary Capital Account Status.

(a) Characterization of Senior Subordinated Securities. The Investor and the Credit

Union hereby agree that the funds received by the Credit Union in connection with the Purchase

shall be deposited into an account (the "Secondary Capital Account") and that the Secondary

Capital Account, together with the Senior Subordinated Securities, shall constitute a "secondary

capital account" for purposes ofthe NCUA Regulations.

(b) Characterization of Lcttcr Agreement The Investor and the Credit Union hereby

agree that the Letter Agreement shall constitute a "secondary capital account contract

agreement" as contemplated by Section 701.34(b)(10) ofthe NCUA Regulations.

(c) Availability to Cover Losses. The Investor and the Credit Union hereby agree

that funds deposited in the Secondary Capital Account shall be available to cover operating

losses realized by the Credit Union that exceed its net available reserves (exclusive ofsecondary

capital accounts and allowance accounts for loan and lease losses). Such funds held in the

Secondary Capital Account shall be available to cover operating losses only to the extent that

accrued but unpaid interest on the Senior Subordinated Securities is unavailable to cover such

losses. To the extent funds held in the Secondary Capital Account are used to cover losses, the

Credit Union shall not restore or replenish the Secondary Capital Account.

(d) Security. The Investor hereby agrees that it shall not pledge or provide the

Secondary Capital Account as security on a loan or other obligation with the Credit Union or any

other party.

Section 6.13 Rule 144; Rule 144A: 4(112) Transactions. (a) At all times after the

Signing Date, the Credit Union covenants that (i) it will, upon the request of the Investor or any

Holder, use its reasonable best efforts to (x), to the extent any Holder is relying on Rule 144

under the Securities Act to sell any of the Senior Subordinated Securities, make "current public

information" available, as provided in Section (c)( I) of Rule 144 (if the Credit Union is a

"Reporting Issuer" within the meaning of Rule 144) or in Section (c)(2) of Rule 144 (if the

Credit Union is a "Non-Reporting Issuer" within the meaning of Rule 144), in either case for

such time period as necessary to permit sales pursuant to Rule 144, (y), to the extent any Holder

is relying on the so-called "Section 4(112)" exemption to sell any of its Senior Subordinated

Securities, prepare and provide to such Holder such information, including the preparation of

private offering memoranda or circulars or financial information, as the Holder may reasonably

request to enable the sale of the Senior Subordinated Securities pursuant to such exemption, or

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(z) to the extent any Holder is relying on Rule 144A under the Securities Act to sell any of its

Senior Subordinated Securities, prepare and provide to such Holder the information required

pursuant to Rule 144A(d)(4), and (ii) it will take such further action as any Holder may

reasonably request from time to time to enable such Holder to sell Senior Subordinated

Securities without registration under the Securities Act within the limitations of the exemptions

provided by (A) the provisions of the Securities Act or any interpretations thereof or related

thereto by the SEC, including transactions based on the so-called "Section 4( I V2)" and other

similar transactions, (B) Rule 144 or 144A under the Securities Act, as such Rules may be

amended from time to time, or (C) any similar rule or regulation hereafter adopted by the SEC;

provided that the Credit Union shall not be required to take any action described in this Section

6.13(a) that would cause the Credit Union to become subject to the reporting requirements of

Section 13 or 15(d) of the Exchange Act if the Credit Union was not subject to such

requirements prior to taking such action. Upon the request of any Holder, the Credit Union will

deliver to such Holder a written statement as to whether it has complied with such requirements

and, if not, the specifics thereof.

(b) The Credit Union agrees to indemnify Investor, Investor's officers, directors,

employees, agents, representatives and Affiliates, and each person, if any, that controls Investor

within the meaning of the Securities Act (each, an "indemnitee"), against any and all losses,

claims, damages, actions, liabilities, costs and expenses (including reasonable fees, expenses and

disbursements of attorneys and other professionals incurred in connection with investigating,

defending, settling, compromising or paying any such losses, claims, damages, actions,

liabilities, costs and expenses), joint or several, arising out of or based upon any untrue statement

or alleged untrue statement of material fact contained in any docurnent or report provided by the

Credit Union pursuant to this Section 6.13 or any omission to state therein a material fact

required to be stated therein or necessary to make the statements therein, in light of the

circumstances under which they were made, not misleading.

(c) If the indemnification provided for in Section 6.13(b) is unavailable to an

Indemnitee with respect to any losses, claims, damages, actions, liabilities, costs or expenses

referred to therein or is insufficient to hold the Indemnitee harmless as contemplated therein,

then the Credit Union, in lieu of indemnifying such Indemnitee, shall contribute to the amount

paid or payable by such Indemnitee as a result of such losses, claims, damages, actions,

liabilities, costs or expenses in such proportion as is appropriate to reflect the relative fault of the

Indemnitee, on the one hand, and the Credit Union, on the other hand, in connection with the

statements or omissions which resulted in such losses, claims, damages, actions, liabilities, costs

or expenses as well as any other relevant equitable considerations. The relative fault of the

Credit Union, on the one hand, and of the Indemnitee, on the other hand, shall be determined by

reference to, among other factors, whether the untrue statement of a material fact or omission to

state a material fact relates to information supplied by the Credit Union or by the Indemnitee and

the parties' relative intent, knowledge, access to information and opportunity to correct or

prevent such statement or omission; the Credit Union and Investor agree that it would not be just

and equitable if contribution pursuant to this Section 6.13(e) were determined by pro rata

allocation or by any other method of allocation that does not take account of the equitable

considerations referred to in Section 6.13(b). No Indemnitee guilty of fraudulent

misrepresentation (within the meaning of Section II (f) of the Securities Act) shall be entitled to

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contribution from the Credit Union if the Credit Union was not guilty of such fraudulent

misrepresentation.

Section 6.14 Expenses and Further Assurances. (a) Unless otherwise provided in this

Agreement, each of the parties hereto will bear and pay all costs and expenses incurred by it or

on its behalf in connection with the transactions contemplated under this Agreement, including

fees and expenses of its own financial or other consultants, investment bankers, accountants and

counsel.

(b) The Credit Union shall, at the Credit Union's sole cost and expense, (i) furnish to

the Investor all instruments, documents and other agreements required to be furnished by the

Credit Union pursuant to the terms of this Agreement, including, without limitation, any

documents required to be delivered pursuant to Section 6.I3 above, or which are reasonably

requested by the Investor in connection therewith; (ii) execute and deliver to the Investor such

documents, instruments, certificates, assignments and other writings, and do such other acts

necessary or desirable, to evidence, preserve and/or protect the Senior Subordinated Securities

purchased by the Investor, as Investor may reasonably require; and (iii) do and execute all and

such further lawful and reasonable acts, conveyances and assurances for the better and more

effective carrying out of the intents and purposes of this Agreement, as the Investor shall

reasonably require from time to time.

Section 6.15 Communications to Holders. Any Holder shall have the right, upon

five (5) business days prior written notice to the Credit Union or its duly appointed agent to

obtain a complete list ofHolders. In addition, any Holder shall have the right to request that

the Credit Union or its duly appointed agent send a notice on behalf of such Holder to all

other Holders at the addresses set forth on the Senior Subordinated Securities Register or, to the

extent the Credit Union has entered into a depositary arrangement, by means of any procedures

applicable to such depositary arrangement.

ARTICLE VII

Subordination of the Senior Subordinated Securities

Section 7.1 Agreement to Subordinate. (a) The Credit Union covenants and agrees,

and each Holder of Senior Subordinated Securities issued hereunder likewise covenants and

agrees, that the Senior Subordinated Securities shall be issued subject to the provisions of this

Article VII; and each Holder of a Senior Subordinated Security, whether upon original issue or

upon transfer or assignment thereof accepts and agrees to be bound by such provisions.

(b) The payment by the Credit Union of the principal of and interest on all Senior

Subordinated Securities issued hereunder shall, to the extent and in the manner hereinafter set

forth, be subordinated and subject in right of payment to the prior payment in full of all amounts

then due and payable in respect of Senior Indebtedness, whether outstanding at the date of this

Agreement or thereafter incurred.

(c) No provision of this Article VII shall prevent the occurrence of any Event of

Default (or any event which, after notice or the lapse oftime or both would become, an Event of

Default) with respect to the Senior Subordinated Securities hereunder.

UST Sequence No. 1390

US2000 118<)l227, 1

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Section 7.2 Default on Senior Indebtedness. (a) In the event and during the

continuation of any default by the Credit Union in the payment of principal. premium, interest or

any other payment due on any Senior Indebtedness, no payment shall be made by the Credit

Union with respect to the principal or interest on the Senior Subordinated Securities or any other

amounts which may be due on the Senior Subordinated Securities pursuant to the terms hereof or

thereof.

(b) In the event of the acceleration ofthe maturity ofthe Senior Indebtedness, then no

payment shall be made by the Credit Union with respect to the principal or interest on the Senior

Subordinated Securities or any other amounts which may be due on the Senior Subordinated

Securities pursuant to the terms hereof or thereof until the holders of all Senior Indebtedness

outstanding at the time of such acceleration shall receive payment, in full, of all amounts due on

or in respect ofsuch Senior Indebtedness (including any amounts due upon acceleration).

(c) In the event that, notwithstanding the foregoing, any payment is received by any

Holder of a Senior Subordinated Security, when such payment is prohibited by the preceding

paragraphs of this Section 7.2. such payment shall be held in trust for the benefit of. aud shall be

paid over or delivered by the Holder of the Senior Subordinated Securities to the holders of

Senior Indebtedness or their respective representatives, or to the trustee or trustees under any

indenture pursuant to which any of such Senior Indebtedness may have been issued, as their

respective interests may appear, but only to the extent of the amounts in respect of such Senior

Indebtedness and to the extent that the holders ofthe Senior Indebtedness (or their representative

or representatives or a trustee) notify the Credit Union in writing within 90 days ofsuch payment

ofthe amounts then due and owing on such Senior Indebtedness, and only the amounts specified

in such notice to the Credit Union shall be paid to the holders of such Senior Indebtedness. The

Credit Union shall, within ten (10) business days of receipt of such notice, provide Investor with

(i) a copy of such notice delivered to the Credit Union and (ii) a certificate signed on behalf of

the Credit Union by a Senior Executive Officer certifying that the information set forth in such

notice is true and correct and confinning that the Holder of the Senior Subordinated Securities

should payor deliver the amounts specified in such notice in the manner specified therein.

Section 7.3 Liquidation; Dissolution. (a) Upon any payment by the Credit Union or

distribution of assets of the Credit Union of any kind or character, whether in cash, property or

securities, to creditors upon any dissolution, winding-up, liquidation or reorganization of the

Credit Union. whether voluntary or involuntary or in insolvency, receivership or other

proceedings, the holders of all Senior Indebtedness of the Credit Union will first be entitled to

receive payment in full of amounts due on or in respect of such Senior Indebtedness, before any

payment is made by the Credit Union on account of the principal of or interest on the Senior

Subordinated Securities or any other amounts which may be due on the Senior Subordinated

Securities pursuant to the terms hereof or thereof); and upon any such dissolution, winding-up,

liquidation or reorganization, any payment by the Credit Union, or distribution of assets of the

Credit Union of any kind or character, whether in cash, property or securities, which the Holder

of the Senior Subordinated Securities would be entitled to receive from the Credit Union, except

for the provisions of this Article VIJ, shall be paid by the Credit Union or by any receiver,

liquidating trustee, agent or other person making such payment or distribution, or by the Holder

of the Senior Subordinated Securities under this Agreement if received by them or it. directly to

tbe holders of Senior Indebtedness of the Credit Union (pro rata to such holders on the basis of

UST Sequence No. 1390

US200(j 118')3227.1

-37-
the respective amounts of Senior Indehtedness held by such holders, as calculated by the Credit

Union) or their representative or representatives, or to the trustee or trustees under any indenture

pursuant to which any instruments evidencing such Senior Indebtedness may have been issued,

as their respective interests may appear, to the extent necessary to pay all such amounts of Senior

Indehtedness in full, in money or money's worth, after giving effect to any concurrent payment

or distribution to or for the holders of such Scnior Indebtedness, before any payment or

distribution is made to the Holder ofthe Senior Subordinated Securities.

(h) In the event that, notwithstanding the foregoing, any payment or distribution of

assets ofthe Credit Union of any kind or character prohibited by Section 7.3(a), whether in cash,

property or securities, shall be received by any Holder of the Senior Subordinated Securities,

before the amounts of all Senior Indebtedness is paid in full, or provision is made for such

payment in money in accordance with its terms, such payment or distribution shall be held in

trust for the benefit of and shall he paid over or delivered hy any Holder of a Senior

Subordinated Security, to the holders of such Senior Indebtedness or their representative or

representatives, or to the trustee or trustees under any indenture pursuant to which any

instruments evidencing such Senior Indebtedness may have been issued, as their respective

interests may appear, as calculated by the Credit Union, for application to the payment of all

amounts of Senior Indebtedness remaining unpaid to the extent necessary to pay all amounts due

on or in respect of such Senior Indebtedness in full in money in accordance with its terms, after

giving effect to any concurrent payment or distribution to or for the benefit ofthe holders ofsuch

Senior Indebtedness. In such event, the Credit Union shall provide Investor with a certificate

signed on behalf ofthe Credit Union by a Senior Executive Officer confirming that the Holder of

the Senior Subordinated Securities should payor deliver such amounts to the holders of such

Senior Indebtedness.

(c) For purposes ofthis Article VII, the words "cosh, property or securities" shall not

be deemed to include Capital Interests in the Credit Union as reorganized or readjusted, or

securities of the Credit Union or any other entity provided for by a plan of reorganization or

readjustment, the payment of which is subordinated at least to the extent provided in this

Article VII with respect to the Senior Subordinated Securities to the payment of Senior

Indebtedness that may at the time be outstanding, provided that (i) such Senior Indebtedness is

assumed by the new entity, if any, resulting from any such reorganization or readjustment, and

(ii) the rights of the holders of such Senior Indebtedness are not, without the consent of such

holders, altered by such reorganization or readjustment. The consolidation of the Credit Union

with, or the merger of the Credit Union into, another person or the liquidation or dissolution of

the Credit Union following the sale, conveyance, transfer or lease of its property as an entirety,

or substantially as an entirety, to another person upon the terms and conditions provided for in

Section 4.2(a) of this Agreement shall not be deemed a dissolution, winding-up, liquidation or

reorganization for the purposes of this Section 7.3 if such other person shall, as a part of such

consolidation, merger, sale, conveyance, transfer or lease, comply with the conditions stated in

Section 4.2(a) ofthis Agreement.

Section 7.4 Subrogation. (a) Subject to the payment in full of all of Senior

Indebtedness, the rights ofthe Holders ofthe Senior Subordinated Securities shall be subrogated

to the rights of the holders of such Senior Indebtedness to receive payments or distributions of

cash, property or securities of the Credit Union, as the case may be, applicable to such Senior

UST Sequence No. 1390 -38-
Indebtedness until the principal of and interest on the Senior Subordinated Securities shall be

paid in full; and, for the purposes of such subrogation, no payments or distributions to the

holders of such Senior Indebtedness of any cash, property or securities to which the Holders of

tbe Senior Subordinated Securities would be entitled except for the provisions of this Article VII,

and no payment pursuant to the provisions of this Article VII to or for the benefit of the holders

of such Senior Indebtedness by the Holders of the Senior Subordinated Securities shall, as

between the Credit Union, its creditors other than holders of Senior Indebtedness of the Credit

Union, and the Holders of the Senior Subordinated Securities, be deemed to be a payment by the

Credit Union to or on account of such Senior Indebtedness. It is understood that the provisions

of this Article VII are intended solely for the purposes of defining the relative rights of the

Holders of the Senior Subordinated Securities, on the one hand, and the holders of such Senior

Indebtedness on the other hand.

(b) Nothing contained in this Article VII or elsewhere in this Agreement or in the

Senior Subordinated Securities is intended to or shall impair, as between the Credit Union, its

creditors other than the holders of Senior Indebtedness of the Credit Union, and the Holders of

the Senior Subordinated Securities, the obligation of the Credit Union, which is absolute and

unconditional, to pay to the Holders of the Senior Subordinated Securities the principal of and

interest on the Senior Subordinated Securities as and when the same shall become due and

payable in accordance with their terms, or is intended to or shall affect the relative rights of the

Holders ofthe Senior Subordinated Securities and creditors ofthe Credit Union, as the ease may

be, other than the holders of Senior Indebtedness of the Credit Union, as the case may be, nor

shall anything herein or therein prevent the Holder of any Senior Subordinated Securities from

exercising all remedies otherwise permitted by applicable law upon default under this

Agreement, subject to the rights, if any, under this Article VII of the holders of such Senior

Indebtedness in respect of cash, property or securities of the Credit Union, as the case may be,

received upon the exercise of any such remedy.

Section 7.5 Notice bv the Credit Union. (a) The Credit Union shall give prompt

written notice to the Holders of the Senior Subordinated Securities of any fact known to the

Credit Union that would prohibit the making of any payment of monies in respect of the Senior

Subordinated Securities pursuant to the provisions ofthis Article VI!.

(b) Upon any payment or distribution of assets ofthe Credit Union referred to in this

Article VII. the Holders of the Senior Subordinated Securities shall be entitled to conclusively

rely upon any order or decree entered by any court of competent jurisdiction in which such

insolvency, receivership, liquidation, reorganization, dissolution, winding-up or similar case or

proceeding is pending, or a certificate ofthc liquidating trustee, custodian, receiver, assignee for

the benefit of creditors, agent or other person making such payment or distribution, delivered to

the Holders of the Senior Subordinated Securities, for the purpose of ascertaining the persons

entitled to participate in such payment or distribution, the holders of Senior Indebtedness and

other indebtedness of the Credit Union, the amount thereof or payable thereon, the amount or

amounts paid or distributed thereon and all other facts pertinent thereto or to this Article VII.

Section 7.6 Subordination May Not Be Impaired. (a) No right of any present or future

holder of any Senior Indebtedness of the Credit Union to enforce subordination as herein

provided shall at any time in any way be prejudiced or impaired by any act or failure to act on

UST Sequence No. 1390

US201l0 II WH227, 1

-39-
the part of the Credit Union, as the case may be, or by any act or failure to act, in good faith, by

any such holder, or by any noncompliance by the Credit Union, as the case may be, with the

terms, provisions and covenants of this Agreement, regardless of any knowledge thereof that any

such holder may have or otherwise be charged with.

(b) Without in any way limiting the generality ofthe foregoing paragraph, the holders

of Senior Indebtedness of the Credit Union may, at any time and from time to time, without the

consent of or notice to the Holders of the Senior Subordinated Securities, without incurring

responsibility to the Holders of the Senior Subordinated Securities and without impairing or

releasing the subordination provided in this Article VIl or the obligations hereunder of the

Holders ofthe Senior Subordinated Securities to the holders ofsuch Senior Indebtedness, do any

one or more of the following: (i) change the manner, place or terms of payment or extend the

time of payment of, or renew or alter, such Senior Indebtedness, or otherwise amend or

supplement in any manner such Senior Indebtedness or any instrument evidencing the same or

any agreement under which such Senior Indebtedness is outstanding; (ii) sell, exchange, release

or otherwise deal with any property pledged, mortgaged or otherwise securing such Senior

Indebtedness; (iii) release any person liable in any manner for the collection of such Senior

Indebtedness; and (iv) exercise or refrain from exercising any rights against the Credit Union, as

the case may be, and any other person.

ARTICLE VIII

Miscellaneous

Section 8.1 Termination. This Agreement shall terminate upon the earliest to occur

of:

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

(i) by either the Investor or thc Credit Union if the Closing shall not have

occurred by the 30th calendar day following the Signing Date; provided, however, that in

the event the Closing has not occurred by such 30th calendar day, the parties will consult

in good faith to determine whether to extend the term of this Agreement it being

understood that the parties shall be required to consult only until the fifth calendar day

alter such 30th calendar day and not be under any obligation to extend the term of this

Agreement thereafter; provided, further, that the right to terminate this Agreement under

this Section 8.1(a)(i) shall not be available to any party whose breach of any

representation or warranty or failure to perform any obligation under this Agreement

shall have caused or resulted in the failure of the Closing to occur on or prior to such

date; or

(ii) by either the Investor or the Credit Union in the event that any

Governmental Entity shall have issued an order, decree or ruling or taken any other

action restraining, enjoining or otherwise prohibiting the transactions contemplated by

this Agreement and such order, decree, ruling or other action shall have become final and

nonappealable; or

(iii)

UST Sequence No. 1390

US201l0 1180-'227.1

by the mutual written consent ofthe Investor and thc Credit Union; or

-40-
(b)

who le: or

the date on which all of the Senior Subordinated Securities have been redeeme d in

(c) the dat e on wh ich the Investor has transferred all of the Senior Subo rdinated

Securities to third part ies which are not Affil iates ofthc Investor; or

(d) ifthe Clos ing sh all not ha ve occurred by Sept ember 30, 2010, on such dat e .

In the eve nt of termi nation of this Agr eement as pro vided in this Section 8.1 , this Ag reement

sha ll forthwith become vo id and there sha ll be no liability on the part of eit he r party hereto

except that noth ing herein sha ll relie ve either party from liability for any bre ach of this

Agreem ent.

Section 8.2 Surv ival. (a) This A greement and all repres entations, war rant ies.

covenants and ag reements made herein sha ll survive the Clos ing witho ut limi tation.

(b) The covenants set fo rth in Article TV and the agreem ents set fo rth in Articles V

and VI sha ll, to the extent such covenants do not explicitly terminate at such time as the Investor

no longer owns any Senior Subordinated Securities, survive th e termination of this Agreement

pursuant to Section 8.1(c) hereof witho ut limitation until th e da te on which all of the Senior

Subordinated Securi ties have bee n red eemed in who le .

Section 8.3 Amendment. Except as otherwise provided herein, no amendment,

modi fication, term ination or waiver of any provi sion ofthis Agreement, the Senior Subordinated

Sec urities or an y of th e other Tr ansaction Documents, or consent to any departure by th e Credit

Union therefrom. sha ll be effective unless made in writing and signed by an o ffic er or a du ly

authorized representative of the Credi t Un ion, and in the case o f the Senior Subordi nated

Securities. the M ajority Holders: provided that, for so long as the Seni or Subordin ated Securi ties

are outsta nd ing, the Investor may at any time and from time to time unilatera lly amend

Sec tion 4.1(d) to the extent the Investor deem s necessary, in its sole discretion. to comply wi th.

or conform to, any changes alte r the Signing Date in any federal statutes. any rules and

regulations pro mulgated the reunder and any other publications or interpretative releases o f the

Fund governing CDFls, including, without limi tation, any changes in the criteria for certification

of an entity as a con by the Fund; provided.further, that, notwith standing anything else in th is

Section 8.3, no amendment. modification, termination or waiver with respect to the Seni or

Subordinated Securities shall, unle ss in writing and signed by all Holders. do any of the

fol lowing: (a) change the principal of or the rate of interest on any Senior Subordinated Security:

(b) extend any datc fixed for any payment or pri ncipal or interest; (c) change the de fin ition ofthe

tel111S "Holders" or "Majority Holders" or the pe rcentage of Holders which shall be required for

Holders to take any action hereunder; (d) amend or waive thi s Section 8.3 or the defi nitions of

the tel111S used in this Section 8.3 insofar as the definitions affect the substance of this

Section 8.3 ; or (e) consent to the assignment, delegation or other tr an sfer by the Credit Union of

any of its rights and obligations under any Transaction Docume nts. Any amendment,

mo dification, term ination, waiver or consent effected in accordan ce wi th th is Sec tion 8.3 sha ll be

binding up on eac h Holder or the Senior Subordinated Sec urit ies at the time outstanding, each

future Ho lder of the Senior Subordinated Securities and the Credit Un ion. No fai lure or de lay by

any party in exerc ising an y right, power or pri vil ege hereunder shall operate as a waiver thereof

UST Sequence No. 1390

US2000 1189322 7. 1

-4 1-
nor shall any single or partial exercise thereof preclude any other or further exercise of any other

right, power or privilege. The rights and remedies herein provided shall be cumulative of any

rights or remedies provided by law.

Section 8.4 Waiver of Conditions. The conditions to each party's obligation to

consummate the Purchase are for the sole benefit of such party and may be waived by such party

in whole or in part to the extent permitted by applicable law. No waiver will be effective unless

it is in a writing signed by a duly authorized officer of the waiving party that makes express

reference to the provision or provisions subject to such waiver.

Section 8.5 GOVERNING LAWi SUBMISSION TO JURISDICTION, ETC.

This Agreement and any claim, controversy or dispute arising under or related to this Agreement,

the relationship of the parties, and/or the interpretation and enforcement of the rights and duties

ofthe parties shall be enforced, governed, and construed in all respects (whether in contract or in

tort) in accordance with the federal law of the United States if and to the extent such law is

applicable, and otherwise in accordance with the laws of the State of New York applicable to

contracts made and to be performed entirely within such State. Each of the parties hereto agrees

(a) to submit to the exclusive jurisdiction and venue of the United States District Court for the

District of Columbia and the United States Court of Federal Claims for any and all civil actions,

suits or proceedings arising out of or relating to this Agrecment or the Purchase contemplated

hereby and (b) that notice may be served upon (i) the Credit Union at the address and in the

manner set forth for notices to the Credit Union in Section 8.6 and (ii) the Investor at the address

and in the manner set forth for notices to the Credit Union in Section 8.6, but otherwise in

accordance with federal law. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH

OF THE PARTIES HERElO HEREBY UNCONDITIONALLY WAIVES TRIAL BY JURY

IN ANY CIVIL LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT

OR THE PURCHASE CONTEMPLATED HEREBY.

Section 8.6 Notice~. Any notice. request, instruction or other document to be given

hereunder by any party to the other will bc in writing and will be deemed to havc bccn duly

given (a) on the date of delivery if delivered personally, or by facsimile, upon confirmation of

receipt, or (b) on the second business day following the date of dispatch if delivered by a

recognized next day courier service. All notices to the Credit Union shall be delivered as set

forth in Schedule A, or pursuant to such other instruction as may be designated in writing by the

Credit Union to the Investor. All notices to the Holders of Senior Subordinated Securities shall

be delivered in writing, mailed first-class postage prepaid, to each Holder of a Senior

Subordinated Security at the address of such Holder as it appears in the Senior Subordinated

Securities Register. All notices to the Investor shall be delivered as set forth below, or pursuant

to such other instructions as may be designated in writing by the Investor to the Credit Union.

Ifto the Investor:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW

Washington, D.C. 20220

Attention: Chief Counsel, Office of Financial Stability

Facsimile: (202) 927-9225

UST Sequence No. 1390

US2000 11~9}227.1

-42-
E-mail: CDCTNo ticermdo.treas.gov

with a copy to:

E-mail: OFSChiefCounsclNotices@do.treas.gov

Section 8.7 Assignment. Neither this Agreement nor any right, remedy. obligation nor

liability arising hereunder or by reason hereof sha ll be assignable by any party hereto without the

prior written consen t of the other party, and any attempt to assign any right, remedy, obligation

or liability hereunder without such consent shall be void, except (a) an assig nment, in the case of

a merger, conso lidation, statutory share exchange or simil ar transaction that requires the approval

of the Credit Union's Interest Holders or other equity securityholders (a "Business

Combination") where such party is not the surviving entity, or a sale of substantially all of its

asse ts, to the entity which is the survivor of such Business Combination or the purchaser in such

sale, (b) an assignment of certain rights as provided in Section 4.1(c) or (c) an assignment by the

Investor of this Agreement to an Affiliate of the Investor; provided that, if the Investor assigns

this Agreement to an Affiliate, the Investor shall be relieved of its obligations under this

Agreement but (i) all rights, remedies and obligations of the Investor hereunder shall continue

and be enforcea ble by such Affiliate, (ii) the Credit Union's obligations and liabilities hereunder

shall continue to be outstanding and (iii) all references to the Investor herein shall be deemed to

be references to such Affiliate.

Section 8.8 Severability. If any provrsion of this Agreement or the Senior

Subordinate d Securities, or the applicat ion thereof to any person or circumstance, is determined

by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining

provisions hereof. or the appli cation of such provision to persons or circumstances other than

those as to which it has been held invalid or unenforceab le, will remain in full force and effect

and shall in no way be affec ted, impaired or invalidated thereby, so long as the economic or legal

substance of the transactions contemplated here by is not affected in any manner materially

adv erse to any party. Upon such determination, the parties shall negotiate in good faith in an

effort to agree upon a suitable and equitable substitute provision to effect the original intent of

the parties.

Section 8.9 No Thir d-Party Beneficiaries. Other than as expressly provided herein,

nothing contained in this Agreement expressed or impl ied, is intended to confe r upon any person

or entity other than the Credit Union, the Investor, any Holder of the Senior Subordinated

Securities and any Indemn itee any benefit, right or remedi es.

Section 8.10 Tax Treatment of Senior Subordinated Securities. The Investor and the

Credi t Union agree that, for all tax purposes, the Senior Subordinated Sec urities will be treated

as debt instruments and not as stock or equity of' the Credit Union.

Section 8.11 Specific Performance. The parties agree that irreparable damage would

occur in the event that any of the provisions ofthis Agreement were not performed in accordance

with their specific terms. It is accordingl y agreed that the parties shall be entitled (without the

necessi ty of posting a bond) to specific performanc e of the terms hereof, this being in addition to

any other remedies to which they are entitled at law or equity.

UST Sequence No, 1390

US2000 11893227 .1

-43-
UST Sequence No. 1390

US20(1) 118<),227, I

~FORM m' SENIOR SUBORDINATED SECURITIES

[SEE ATTACHED]

-44-

ANNEXA
(CDn Credit Unions

Senior Securities)

ANNEXA

FORM OF SENIOR SUBORDINATED SECURITIES

(FORM OF FACE OF SECURITY)

"THIS SEN IOR SUBORDINATED SECURITY WILL BE ISS UED AND MAY BE

TRANSFERRED ONLY IN MINIM UM DENO MINATIONS OF s1,000 AND

MULTIPLES OF $ 1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANS FER

OF SUCH SEC URITIES IN A DENOMINATION OF LESS THAN $ 1,000 AND

MULTIPLES OF $1,000 IN EXCESS THEREO F SHALL BE DE EMED TO BE VOID

AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED

TRAN SFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCII

SECURITI ES FOR ANY PURPOSE, INCLU DING, BUT NOT LIMITED TO, THE

RECEIPT OF PAYMENTS ON SUCH SECURITIES, AND SUCH PURPORTED

TRANSFEREE SIIALL BE DEEMED TO HAVE NO INTEREST WHATSOEVE R IN

SUC H SEC URITIES.

THI S SEC URITY IS SUBJECT TO THE TERMS AND CONDITIONS SET FOR'I'll IN

THE LETTER AGREEMENT BY AND BETWEEN THE CREDIT UNION AND THE

UNITED STATES DEPARTMENT OF THE TREASURY AND SECURITIES

PUR CHA SE AGREEMENT - STANDARD TERMS (THE "AGREEMENT"), EACH

Or: WHICH ARE INCORPORATED INTO THIS SENIOR SUBORDINATED

SECURIT Y

THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT

INSURED BY THE UNITED STATES, ANY AGENCY OR FUND OF THF:

UNITED STATES OR THE NATIONAL CREDIT UNION SHARE INSURANCE

FUND.

TIllS OBLIGATION IS SUBORDINATED AND JUNIOR IN RIGHT OF PAY MENT,

AS TO I'RIN CIPAL, INTEREST AND PRE MIUM , TO ALL CLA IMS AGAINST TilE

CREDIT UNION HAVI NG THE SAME PRIORITY AS SAV INGS ACC OUNT

HOLDERS, SIIAREHOLDERS OR OTIIER DEPOSIT ORS , THE NA TrONA I,

CREDIT UNION SHARE INSURANCE FUND OR ANY HIGHER PRIORITY,

INCLUDI NG GEN ERAL AND SECURED CREDITORS OF TilE CREDIT UNION.

TillS OBLIGAT ION IS NOT SECURED BY TIlE CREDIT UNI ON' S ASSETS OR

TilE ASSETS OF ANY OF ITS AFFILI ATES . THI S OBLlGATl ON IS NOT

ELIGIBLE AS COLLATE RAL fOR AN Y LOAN BY THE CREDIT UNIO N.

THE TER MS UNDER WHICH THE CREDI T UNION MAY PREPAY THIS SENIOR

SUBORDINATED SECURITY ARE SET FORTII IN THE AGREEMENT.

THIS SEC URITY HAS NOT BEEN REG ISTERED UNDER THE SECURITIES ACT

OF 1933, AS AMENDED (THE "SECURITIES ACT'), OR THE SECURITIES LAWS

OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE

DISPOSED OF EXCEPT WHILE A REGISTRATI ON STATEMENT RELATING

UST Sequence No. 1390 A-I

US2000 j 1893137 I
(CDFI Credit Unions

Senior Securities)

THERETO IS IN EFFECT LINDER SUCH ACT AND APPLICABLE STATE

SECURITIES LA WS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION

LINDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF THIS SECURITY

IS NOTIFIED THAT THE SELLER MAYBE RELYING ON THE EXEMPTION

FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A

THERElINDER. ANY TRANSFEREE OF TIllS SECURITY BY ITS ACCEPTANCE

HEREOF (1) REPRESENTS THAT IT IS A "QUALlFIED INSTITUTIONAL BUYER"

(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT

IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES

REPRESENTED BY THIS INSTRUMENT EXCEPT (A) PURSUANT TO A

REGISTRATION STATEMENT WHICH IS THEN EFFECTIVE UNDER THE

SECURITIES ACT, (B) FOR SO LONG AS THE SECURITIES REPRESENTED BY

THIS INSTRUMENT ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A,

TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL

BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT

PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A

QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE

TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE CREDIT

UNION OR (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM

THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3)

AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS

TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS

LEGEND.

THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON

TRANSFER AND OTHER PROVISIONS OF THE AGREEMENT BETWEEN THE

CREDIT UNION AND THE INVESTOR REFERRED TO THEREIN. A COPY OF

WHICH IS ON FILE WITH THE CREDIT LINION. THIS SECURITY MAY NOT BE

SOLD OR OTHERWISE TRANSFERRED EXCL:PT IN COMPLIANCE WITH SAID

AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH

SAID AGREEMENT WILL BE VOlD."

UST Sequence No. 1390

US2000 11893337.1

A-2
(CDFI Credit Unions

Senior Sec urities)

[NAME OF CREDIT UNION]

[Federal/State ] C redit Union Charter No . _

$- - - - -

2';1" SENIOR SUBORDINATED SECURITY DUE [Insertfor securities with 8 year matu rity:

20 IS ]IInsert fo r securities with I 3 year maturity: 2023]

[Credit Union1, a credit uni on organi zed und er the laws of [ ] (the "Credit

Union, " whic h term inclu des any permitted successor thereto), for value received, hereby

prom ises to pay to the order of the United State s Department of the Treasury or registered

assigns, by wire tran sfer, the prin cipal sum o r $ _

( Dollars) on [Insert fo r securities with 8

year maturity: 20181 [Insert f or securities with 13 year maturity: 2023J (the "Maturity Dale" )

(or any earlier red emp tion date or date of acceleration of the Maturity Date) and to pay interest

on the outstanding principal amount o f this Seni or Subordinated Sec urity Du e [Insert for

securities with 8 year maturity: 2018] [Insert for securities with 13 year maturity: 2023 1 (this

"Senior Subordinated Securityv; (i) from , or from the mo st rec ent int erest

payment date to which interest has been paid or duly prov ided for, quarte rly in arre ars on

f ebruary 15, May 15, August 15 and November 15 of each year (ea ch such date, an " Interest

Payment Da/e"), commencing on , at the rate of 2% per annum. until

the e ightb anniversary or the da te hereof, provided, however , that [(A)I if a CDFl Event shall

have occurred and it 01' any other CDF I Event is continuing at all times, from and aftcr thc ISOLi'

day after the date on which the first CDF] Event oceurrcd until the date on which no CDFl

Events are continuing, the Interest Rate shall be 5% per annum. ITo he inserted ifIssuer ,W IS not

a CDFI on February 3, 2010: and (B) if a CDFI Event shall have occu rred and it or any other

CD FI Eve nt is co ntin uing, at all times, from and after the n o'h day after the date on which the

first CDF] Event occurred until the date on which no CDF ] Events arc continuing, ')% per

annu m] [II/sert for securities with 13 y ear maturity: and (ii) from and after the eighth

anni versary of the date hereof at a rate 01' ')% per annum] (each such interest rate, the applicable

"Interest Ral e") until the prin cipal hereofshall have bee n paid or duly provided for. compounded

quarterly, and on any overdue princ ipa l and on any overdue installment of interest (without

dupli ca tion and to the extent that paym ent ofsuch interest is enforceable under applicable law) at

the same rate per annum. The amount o r interest payabl e hereon sha ll be compute d on the basis

ofa 360 da y year comprised oftwelve 30-day months.

This Senior Subordinated Sec urity is one 01' the Senior Subordinated Sec urities referred

to in the Letter Agree me nt and Securities Purchase Agreement - Standard Terms, dated as of

,-_,- ,----=_ '" (as amended, modified or restated from time to time, the "Agreement").

by and among the Credit Union and the United States Department of the Tre asury, as the initial

Investor (the " !nveslor" ). Capitalized terms used in this Senior Subordina ted Securi ty arc

defined in the Agreement unle ss otherwise expressly stated herein. The Senior Subordinated

Sec urity is entitled to the benefits of the Agreement and is subject to all of the agreements. terms

and conditions containe d therein , all of which arc incorporated herein by this refe rence. This

UST Sequence No. 1390

l! S2000 11893337. 1

A -3
(CD rI Credit Unions

Senior Securities)

Senior Subordinated Secu rity may be redeemed, in whole or in part, in accordance with the terms

and conditions set forth in the Agreement.

Interest

The interest installment so paya ble, and punctually paid or duly provided for, on any

Inte rest Payment Date will be pa id to the person in whose name this Senio r Subordinated

Security is reg istered at the close of business on the regular record date for such installm ent of

interest, which date shall be at the close of business on the Ist calendar day (whet her or not a

business day) of the month in which eac h Interest Payment Date occurs (each such date, the

"Regular Record Dale"). Any such installment of interest not punctually paid or duly pro vided

for shall fort hwith cease to be payable to the IIolders on such Regular Rec ord Dat e and shall be

paid to th e person in whos e name this Senior Subordinated Secur ity is registered at the clo se of

business on the dat e prece ding the next Interest Payment Da te, on the next Interest Payment

Date, along with all other amounts then due and payable. [n no event , however, shall intere st

exceed the maximum rate permitted by app licable law .

If an Interest Payment Dale or the Maturity Date falls on a day that is not a "business

day" (as defined in the Agreement), the related payment of principal or interest will be paid on

the next busine ss day, with the same force and effect as if made on such date, and no interest on

such payments will accrue from and after such Intere st Payment Date or Maturity Dat e, as the

case may be. Interest payable on the Matu rity Date ofthe Senior Subordinated Securities will be

paid to the registered Holder to whom the principal is payable upon presentation and surrender

for cancellation.

Method of Payment

The principal of this Sen ior Subordinated Secur ity shall be payable upon surre nder hereof

and intere st on this Senior Subordinated Secur ity shall be payab le at the offi ce or agency of the

Credit Union or an agent appointed for that purpose in any coi n or currency of the United State s

of America that at the time of payment is legal tender for paym ent of public and private deb ts;

provided , however , that payment of interest shall be made by the Credit Union to the Hol ders of

th is Seni or Subordinated Secu rity entitled thereto as shown on the Senior Subordinated

Securities Register by wire transfer of immediately available funds to any account with a

banking institution located in the United States designated by such Holder no later than the

related Regular Record Date.

Subord ination

The indebtedness evidenced by th is Senior Subordinated Security is, to the extent

provided in the Agreement, sub ordinate and j unior in right of payment to all deposit liabilities of

the Credit Union and to the Credit Union 's debt obl igations to its general and secured creditors,

unless such debt obligations are explicitly made pori passu or subordinated to the Senior

Subordinated Securities, in accordance with regulation s of the Appropriate Supervisory

Autho rity , if applicable. Each Iiolder of this Senior Subordinated Security, by accepting the

same agrees to and shall be bound by such pro visions of the Agreement. Each Holder hereof, by

his or her acceptance hereof, hereby waives all noti ce of the acceptance of' the subordination

UST Sequence No. 1390

L'S20()(J 1\WJ3337.1

A-4
(CDFI Credit Unions

Senior Securities)

provisions contained herein and in the Agreement by each holder of Senior Indebtedness.

whether now outstanding or hereafter incurred, and waives reliance by each such holder upon

said provisions.

The provisions of this Senior Subordinated Security arc continued on the reverse side

hereof and such provisions shall for all purposes have the same effect as though fully set forth at

this place.

IN WITNESS WHEREOF, the Credit Union has caused this instrument to be duly

executed this

___ day of _

[NAME OF CREDIT UNIONI

By:__

Name:

Title:

Attest:

By: __

Name:

Title:

UST Sequence No. 1390

US20ClO 118933371

A-S
(CDFI Credit Unions

Senior Securities)

(FORM OF REVERSE OF SECURITY)

This Senior Subordinated Security is one of the Senior Subordinated Securities of the

Credit Union (herein sometimes referred to as the "Senior Subordinated Securities"), issued or to

be issued under and pursuant to a Letter Agreement and Securities Purchase Agreement -

Standard Terms, dated as of ,2010 (as amended, modified or restated from time

to time, the "Agreement"), by and between the Credit Union and the United States Department

of the Treasury, as the initial Investor (the "Investor"), to which Agreement reference is hereby

made for a description of the rights, limitations of rights, obligations, duties and immunities

thereunder of Credit Union and the Holders of the Senior Subordinated Securities. This Senior

Subordinated Security is a single series note with a face value in aggregate principal amount as

set forth on the front ofthis Senior Subordinated Security.

Defaults and Remedies

If an Event of Default as provided for under Section 5.1 of the Agreement occurs, then

the principal of, interest accrued on, and other obligations payable under this Senior

Subordinated Security and the Transaction Documents, will immediately become due and

payable. Notwithstanding anything to the contrary herein or in the Agreement, other than

Section 5.2 ofthe Agreement, there is no right of acceleration for any default, including a default

in the payment of principal or interest or the performance of any other covenant or obligation by

the Credit Union under this Senior Subordinated Security or the Agreement.

Amendment and Waiver

No amendment, modification, termination or waiver of any provision of the Agreement,

the Senior Subordinated Securities or any of the other Transaction Documents, or consent to any

departure by the Credit Union therefrom, shall be effective unless made in writing and signed by

an officer or a duly authorized representative of the Credit Union, and in the case of the Senior

Subordinated Securities, the Majority Holders; provided that for so long as the Senior

Subordinated Securities are outstanding, the Investor may at any time and from time to time

nnilaterally amend Section 4.1(d) of the Agreement to the extent the Investor deems necessary,

in its sole discretion, to comply with, or conform to, any ehangcs after the Signing Date in any

federal statutes, any rules and regulations promulgated thereunder and any other publications or

interpretative releases of the Fund governing CDFls, including, without limitation, any changes

in the criteria for certification as a con by the Fund; provided further that no amendment,

modification, termination or waiver with respect to the Senior Subordinated Securities shall,

unless in writing and signed by all Holders, do any of the following: (A) change the principal of

or the rate of interest on any Senior Subordinated Security; (B) extend any date fixed for any

payment of principal or interest; (C) change the definition of the terms "Holders" or "Majority

Holders" or the percentage of Holders which shall be required for Holders to take any action

hereunder; or (D) consent to the assignment, delegation or other transfer by the Credit Union of

any of its rights and obligations under any Transaction Documents.

Any such consent or waiver by the Holder of this Senior Subordinated Security shall be

conclusive and binding upon such Holder and upon all future Holders of this Senior

UST Sequence No. 1390

1)5200011893337.1

A-6
(CDFI Credit Unions

Senior Securities)

Subord inated Sec urity and of any Senior Subordinated Secu rity issued in exc hange here for or in

place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any

notatio n of such consent or waiver is mad e upo n this Senior Subordinated Security.

No refe rence herein to the Agreement and no provision of this Senior Subordinated

Secur ity or of the Agreement sha ll alter or impair the obligation of the Credit Union, which is

absolute and unconditional, to pay the princi pal of and interest on this Senior Subordinated

Security at the time and plac e and at the rate and in the money herein prescribed.

Limitation on Dividends and Rep urchases olTguity Securities

The Cre dit Union 's ability to declare and pay dividends and purchase or acquire Capital

Interests or other equity securities of any kind of any Credit Union Subs idiary or any Senior

Subordinated Security is limited by the term s of the Agreement. The Credit Union's ability to

redeem this Senior Subord inated Security is limited by the terms of the Agreement.

Denominations; Transfer; Exchange

The Senior Subo rdinated Securities are issuable only in registered form withou t coupons

in minimum denominations of $ 1,000.00 and integral multipl es of $ 1,000. 00 in exc ess thereof.

As pro vided in th e Agreement, this Senior Subordinated Secur ity is tran sfera ble by the Holder

hereof on the Senior Subordinated Sec urities Register ma intained by the Cred it Unio n or its

age nt, upon surrender of this Senior Subordinate d Security for registration of transfer at the

offi ce or age ncy of the Credit Union or its agent, accompanied by a writte n instrument or

instruments of transfer in form satisfactory to the Credit Union dul y executed by the IIolder

hereof or his or her attorney duly authorized in writing, and th ereupon one or more new Senior

Sub ordinated Securi ties of authorized denominations and for the same aggregate principal

amount will be iss ued to the designated trans feree or trans ferees. No service charge will be

mad e for any such registration of transfer, but the Cre dit Union may require payment of a sum

sufficient to cover any tax or other governmental charge payable in relation thereto.

Prior to due pre sentment for registration of transfe r of this Senior Subordinated Security,

the Credit Union and any age nt thereof may dcem and treat the Holder hereof as the absolute

owner hereof (whether or not this Senior Subordinated Security shall be overd ue and

notwithstanding any notice of ownership or writing hereon mad e) lo r the purpose 01' receiving

paymen t of or on account of the principal hereo f and (subj ect to the Agreement) inte rest due

hereon and for all other purposes, and none of the Cre dit Union or any agent the reof shall be

affected by any notice to the contrary.

No Recourse Against Others

No recourse sha ll be had for the payment of the princ ipal of or interest on this Senio r

Subordinated Security, or for any claim based hereon, or otherwise in respect hereo f: or based on

or in re spect of the Agreemen t or any other Transaction Document, against any incorp orator,

Mutua l Interest Holder, employee , officer or director, as such, past, present or future, as such, of

the Cre dit Union or of any successor thereto, whether by virtue of any constitution, statute or rule

of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being,

UST Sequence No. 1390

US2()OO II R93337,I

A-7
(CDFI Credit Un ions

Senior Securities)

by th e acceptance hereo f and as part of the consideration for the issuance here of, expressly

waived and released.

Go verning Law

THE AGREEMENT AND THIS SENIOR SUBORDINATED SECURITY SHALL

EACH BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE

FEDERAL LA W OF THF: UNITED STATES, IF AND TO THE EXTENT SUCH LAW IS

APPLICABLE AND OTHERWISE IN ACCORDANCE WITH THE LAWS OF THE

STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE

PERFORMED ENTIRELY WITHIN SUCH STATE.

Abbre viations

The following ab breviations, wh en used in the inscription on the face of this Senior

Subordinated Security, shall be construed as though they were written out in full according to

applicable laws or reg ulations:

TEN CON - as tenant s in commo n TEN ENT - as tenants in the entireties

.T T TEN - as joint tenants with right of survi val

UN IF GIFT MIN ACT - unde r Uniform Gift to M ino rs Aet and not as tenants

Additional abbreviations may also be used though not in the above list.

UST Sequence No. 1390

US2000 11W>3J37 1

A-8
(CDFI Cre dit Unions

Senior Securities)

ASSIGNMENT

FOR VALUE RECEIVED. the undersigned hereb y assigns and transfers this Senior

Subordinated Security to:

(Assigne e's social security or tax identification number)

(Address and zip code of assignee)

and irrevocably appoints agent to transfer this Senior

Subordinated Security on the books of the Credit Union. The agent may substitute another to act

for him or her.

Date : - - - - - - -

Signature: _

(Sign exac tly as your name appears on the other side ofthis Senior Subordinated Security)

Signature Gua rantee : _

[Signatur e must be guarante ed by an "el igible guarantor

institution" that is a bank. stoc kbroker. sav ings and loan

association or credit union meeting the requirements ofthe

Registrar. which requireme nts include membership or

participation in the Securities Transfer Agents Medallion

Program CSTAMP") or such othe r "signature guarantee

program" as may be determined by the Registrar in

addition to. or in substitution for. STAMP, all in

acco rdance with the Securit ies Exc hange Ac t of 1934. as

amende d.]

UST Sequence No 1390

S~ ) () I I K9.n.li I

A-9
ANNEXB

FORM OF OFFICER'S CERTIFICATE

OFFICER'S CERTIFICATE

OF

[CREDIT UNION]

In connection with that certain letter agreement, dated [ ], 20 I0

(the "Agreement") by and between [CREDIT UNION] (the "Credit Union") and the United

States Department of the Treasury which incorporates that certain Securities Purchase

Agreement -Standard Terms referred to therein (the "Standard Terms"), the undersigned does

hereby certify as follows:

1. I am a duly elected/appointed [ ] of the Credit Union.

2. The representations and warranties of the Credit Union set forth in

Section 3. I of the Standard Terms are true and correct in all respects as though as of the date

hereof (other than representations and warranties that by their terms speak as of another date,

which representations and warranties shall be true and correct in all respects as a f such other

date), and the Credit Union has performed in all material respects all obligations required to be

performed by it under the Agreement.

3. The Credit Union has effected such changes to its Benefit Plans with

respect to its Senior Executive Officers and any other employee of the Credit Union or its

Affiliates subject to Section III of EESA, as implemented by any Compensation Regulations

(and to the extent necessary for such changes to be legally enforceable, each of its Senior

Executive Officers and other employees has duly consented in writing to such changes), as may

be necessary, during the Relevant Period, in order to comply with Section I I I of EI':SA or the

Compensation Regulations.

4. The copies of the Charter and bylaws of the Credit Union attached hereto

as Exhibit A are true, complete and correct as ofthe date hereof

S. The copy of the CDFI Application attached hereto as Exhibit B and the

information therein [when taken together with the CDFI Application Update attached hereto as

Exhibit C] is true, complete and correct as ofthe date hereof

6. [Attached hereto as Exhibit [C][D] is a true, complete and correct copy of

the SCI' Notice][Forty-five days have since the Credit Union submitted a Secondary Capital Plan

related to the Senior Subordinated Securities to its Appropriate Supervisory Authority and such

Secondary Capital Plan has neither been approved or disapproved].

UST Sequence No. 1390

US200011893227.1
The foregoing certifications are made and delivered as of [

Section 2.3 ofthe Standard Terms.

pursuant to

Capitalized terms used and not otherwise defined herein shall have the meanings assigned

to them in the Standard Terms.

[SIGNATURE PAGE FOLLOWS]

UST Sequence No. 1390

US2000 11893227.1

-2-
IN WITNESS WHEREOF, this Officer's Certificate has been duly executed and

delivered as ofthe I_J day of [ ], 20[_J

[CREDIT UNIONI

By: _~~~_~__

Name:

Title:

UST Sequence No. 1390

US2000 11393227]
ANNEX C

FO RM OF WAIVER

In consideration for th e benefits I will rece ive as a result of the partic ipation of INA ME

OF CRED IT UNION ] (together with its subsidiaries and a ffi liates, the "Credit Union") in the

United States Department o f the Treas ury's ("Tre asury" ) Co mmunity De ve lopment Capital

Initiative and/or any other economic stabilization pro gram implemented by Tr easury under the

Emergency Economic Stabilization Act of 2008 (a s am ended, suppleme nted or otherwise

modified, " EESA" ) (any such initiative or program, including the Com m unity Development

Capital Initiative, a "Program" ), I hereby voluntarily waive an y claim against the United States

(and each of its departments and agencies) or the Credit Union or any of its directors, officers,

employees and agents for any changes to my co mpens ation or benefits that are required to

co m ply wi th the executive compensation and corporate govemance requireme nts of Section I I I

of EESA, as impl ement ed by any guidance or regu lation thereunder, including the rules set forth

in 3 1 C.F.R, Part 30, or any othe r guidance or regulations under EESA, and th e appli cab le

requirem ents of the Securities Purchase Agreem ent by and between the Credit Un ion and

Treasury dated as of I ], 20 10, as amended (such requirements, the "LimitationsY.

1 ac knowledge th at the Limitations may requ ire modifi cation or termination of the

empl oyment, co mpensation, bonus, incent ive, severance, re tention and other bene fit pl ans,

arrangements, polic ies and agreements (incl uding so -called "golden parachute" agreements ),

whether o r no t in writing, that I may have with the Credit Union or in which I may participat e as

they relate to the period the United States holds any equity or de bt sec uri ties of the Credit U nion

acquired through a Program or for any other period applicable under suc h Program or

Limi tatio ns, as the case may be, and I hereby consent to all such modi tications.

This wa iver inc ludes all cl aims I may have under the laws of the United St ates or an y

other j urisdict ion (whether or not in existence as of the date hereof) related to the requirements

imposed by th e Limitati ons, including without limitati on a clai m for an y compensatio n or other

payments or benefits I would otherwise receive , any chal lenge to the process by which the

Lim itations are or were ado pted and any tort or constituti onal clai m abo ut the effect of the

Lim itations on my employment relationship an d I he reby agree that I will not at any time ini tiate,

or cause or permit to be initiated on my behalf, any such clai m against the Un ited States (or any

o r its de pa rtments or age ncies) or the Credit Unio n or any of its directors, officers, employees or

agents in or before any local, state, fed eral or other agency, cOUl1 or body.

I agree that, in the event and to the extent that the Compensation Committee ofthe Board

of Direc tors of the Credit Union or sim ilar goveming body (the "Committee") reasonably

de termines that any compensatory payment or be nefi t provided to me, including any bonus or

incen tive compensation based on materially inaccurate financial statements or performance

criteria, would cause the Credit Union to fa il to be in com pliance with the Lim itations (sueh

payment or bene lit, an "Excess Payment" ), upon notific ation fro m the Credit Union, I sha ll repa y

such Excess Payment to the Credit Union with in 15 busi ness days. In additio n, 1 ag ree th at the

Credit Union shall have the rig ht to po stpone any suc h payment or ben efit for a reasonable

UST Sequence No. 1390

US2000 11893227,)

C-l
period of time to enable the Committee to determine whetber such payment or benefit would

constitute an Excess Payment.

J understand that any determination by the Committee as to whether or not, including the

manner in which, a payment or benefit needs to be modified, terminated or repaid in order for the

Credit Union to be in compliance with Section III of EESA and/or the Limitations shall be a

final and conclusive determination of the Committee which sball be binding upon me. J further

understand that tbe Credit Union is relying on this letter from me in connection with its

participation in a Program.

In witness whereof; J execute this waiver on my own behalf, thereby communicating my

acceptance and acknowledgement to the provisions herein.

Respectfully,

By:

Name:

Title:

Date:

UST Sequence No. 1390

US2000 11893217, [

C-2
ANNEX D

FORM OF OPINION

(a) The Credit Union has been duly formed and is validly existing as an organization

of the type described in Schedule A. The Credit Union has all necessary power and authority to

own, operate and lease its properties and to carry on its business as it is being conducted.

(b) The Senior Subordinated Securities have been duly and validly authorized, and,

when executed and delivered pursuant to the Agreement, the Senior Subordinated Securities will

be the legal, valid and binding obligations of the Credit Union, enforceable in accordance with

their terms, except as the same may be limited by applicable receivership, insolvency,

reorganization, moratorium or similar laws affecting the enforcement of creditors' rights

generally and general equitable principles, regardless of whether such enforceability is

considered in a proceeding at law or in equity.

(c) The Credit Union has the power and authority to execute and deliver the

Agreement and to carry out its obligations thereunder (which includes the issuance ofthe Senior

Subordinated Securities).

(d) The execution, delivery and performance by the Credit Union of the Agreement

and the consummation of the transactions contemplated thereby have been duly authorized by all

necessary entity action on the part of the Credit Union and its Interest Holders, and no further

approval or authorization is required on the part of the Credit Union.

(e) The Agreement is a legal, valid and binding obligation of the Credit Union

enforceable against the Credit Union in accordance with its terms, except as the same may be

limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws

affecting the enforcement of creditors' rights generally and general equitable principles,

regardless of whether such enforceability is considered in a proceeding at law or in equity.

(f) The execution and delivery by the Credit Union of the Agreement and the

performance by the Credit Union of its obligations thereunder (i) do not require any approval by

any Governmental Entity to be obtained on the part of the Credit Union, except those that have

been obtained, (ii) do not violate or conflict with any provision ofthe Charter, (iii) do not violate,

conflict with, or result in a breach of any provision of, or constitute a default (or an event which,

with notice or lapse oftime or both, would constitute a default) under, or result in the termination

of, or accelerate the performance required by, or result in a right of termination or acceleration

of, or result in the creation of, any lien, security interest, charge or encumbrance upon any of the

properties or assets of the Credit Union or any Credit Union Subsidiary under any of the terms,

conditions or provisions of its organizational documents or under any agreement, contract,

indenture, lease, mortgage, power of attorney, evidence of indebtedness, letter of credit, license,

instrument, obligation, purchase or sales order, or other commitment, whether oral or written, to

which it is a party or by which it or any of its properties is bound or (iv) do not conflict with,

breach or result in a violation of, or default under any judgment, decree or order known to us that

is applicable to the Credit Union and, pursuant to any applicable laws, is issued by any

Governmental Entity having jurisdiction over the Credit Union.

UST Sequence No. 1390 0 -1

US2000 11893227,1
(g) Other than the filings with the applicable Governmental Entity, such filings and

approvals as are required to be made or obtained under any state "blue sky" laws, if applicable,

and such as have been made or obtained, no notice to, filing with, exemption or review by, or

authorization, consent or approval of, any Governmental Entity is required to be made or

obtained by the Credit Union in connection with the consummation by the Credit Union of the

Purchase.

(h) The Credit Union (A) is a regulated community development financial institution

(a "CDFf') currently certified by the Community Development Financial Institution Fund (the

"Fund") ofthe United States Department of the Treasury pursuant to 12 C.F.R. l805.20l(a) and

(B) satisfies all of the eligibility requirements of the Fund's Community Development Financial

Institutions Program for a CDFI.

UST Sequence No. 1390

US200011893227,1

D-2
ANNEXE

FORM OF DISCLOSURE AND ACKNOWLEDGMENT

[Name of Credit Union] and the United States Department of the Treasury hereby acknowledge

and agree that the United States Department of the Treasury has committed [amount offunds] to

a secondary capital account with [name of Credit Uni on] under the following tel111S and

conditions:

1. Term. The funds committed to the secondary capital account are committed for a period of

[8][13] years.

2. Redempt ion prior to maturity. Subject to thc cond ition s set forth in 12 e FR 701.34, the funds

committed to the secondary capital account are rede emable prior to maturi ty only at the option of

the [name of Credit Union ] and on ly with the prior ap proval of the Appropriate Supervisory

Authority (as defi ned in that certain Letter Agreement, dated as of the date hereof, betwe en

[name ofCredit Union] and the United State s Department of the Treasury.

3. Uninsure d, non -share account . The secondary capital acco unt is not a share account and the

funds com mitted to the seco ndary capital account are no t insured by the National Credit Union

Share Ins urance Fund or any other government al or private entity.

4. Prepayment risk. Redemption of seco ndary capital prior to the account's original maturit y date

may expose the account investor to the risk of being unab le to rein vest the repaid funds at the

same rate of interest for the balance of the period remaining until the original maturity date. The

investor ac knowledges that it understands and assumes responsibility for prepayment risk

assoc iated with the [name of Credit Unio n['s redemption of the investor' s secondary cap ital

account prior to the original maturity date.

5. Availability to cover losses. The funds committed to the secondary capital acco unt and any

interest paid into the account may be used by [name of Cred it UnionJ to cover any and all

operating losses that exceed the Credit Unio n's net worth exclusive of allowance acco unts for

loan losses, and in the eve nt the funds are so used, [name of Credit Union] will under no

circumstances restore or replenish those funds to the United States Department of the Treasu ry.

Dividends are not considered operating losses and are not eligible to be paid out of secondary

cap ital.

6. Accrued interest. By initialing below, [name of Credit Unio n] and the United States

Department of the Tre asury agree that accrued interest will be:

__ Pa id into and become part of the secondary capital account;

--.2l Pa id dire ctly to the United States De partme nt of the Treas ury;

UST Sequence No. 1390

US2000 11H93227 I
___ Paid into a separate account from which the United States Department of the Treasury may

make withdrawals; or

_Any combination ofthe above provided the details are specified and agreed to in writing.

7. Subordination 01 claims. In the event of liquidation of [name of Credit Union], the funds

committed to the secondary capital account will be subordinate to all other claims on the assets

of the Credit Union, including claims of member shareholders, creditors and the National Credit

Union Share Insurance Fund.

8. Prompt Corrective Action. Under certain net worth classifications (see 12 CFR

702.204(b)(11). 702.304(b) and 702.305(b), as the case may be), the NCUA Board may prohibit

[name of Credit Union] from paying principal, dividends or interest on its uninsured secondary

capital accounts established after August 7, 2000, except that unpaid dividends or interest will

continue to accrue under the terms ofthe account to the extent permitted by law.

[SIGNAT1JRE PAGE FOLLOWS]

UST Sequence No. 1390

US200011893227.1

E-2
ACKNOWLEDGED AND AGREED TO this _day of__ "_~__ , 2010 by:

UNITED STATES DEPARTMENT OF THE TREASURY

By:

Name:

Title:

United States Department ofthe Treasury

1500 Pennsylvania Avenue, NW

Washington, D.C. 20220

Attention: ChiefCounsel, Office of Finaneial Stability

ICREDIT UNION]

By:----------------

Name:

Title:

UST Sequence No. 1390

US2000 I 1893227, I

E-3
ANNEX F

OFFICER'S CERTIFICATE

OF

JCRED IT UN IO N]

In connec tion with that certain lett er agr eement, dated [ l- 2010

(the "Agreement") by and between [CRE DIT UNION] (the "Credit Union" ) and the Un ited

St ates Department of the Tr easu ry C!nveslor" ) wh ich incorporates that certain Sec ur ities

Purchase Agreement - Sta nda rd Terms referred to therein (the "Standard Terms"), the

un dersi gned docs hereby certify as follows:

1. I am a dul y elect ed/appointed [ 1ofthe Credit Union.

2. The Credit Union (as defined in th e Standard Terms) (A ) is ce rtified by

the Com munity Development Financial Institution Fund (the "Fund ') of the United States

Dep art ment of the Treasury as a regul ated community de vel opm en t fi nancial institution (a

" CDFf'): (B) together with its Affiliates collectively meets the eligi bility requirements of 12

C. F.R. 1805.20 0(b); (C) has a prima ry mission of promoting community de vel opment , as may be

determined by Inve stor from time to time, based on criteria set forth in 12 C.F.R. 180 5.20 1(b)(l);

(D ) provides Financial Products, Development Se rvice s, and/or other similar fi nancing as a

pred om inant busine ss activity in arm 's-length transactions; (E) se rves a Ta rge t Market by

servi ng one or mo re Investment Areas and/or Targeted Po pulations in the manne r set fort h in 12

C.F. R. 1805.20 1(b)(3); (I') prov ides De velopment Se rvices in conjunction with its Fina nc ial

Products, directl y, thro ug h an Affi liate or through a contract w ith a third-party pro vider ; (0 )

maintains accountability to residents of th e applicabl e Inve stment Area(s) or Ta rgeted

Popula tion(s) through rep resentation on its gov erning Board or D irectors or otherwise; an d (1 I)

rema ins a non-governm ental entity wh ich is not an agency or instrumentality ofthe United States

of America, or any Sta te or political subdivision thereof, as described in 12 c.r .R. 1805.

20 I(b)(6) and within the meaning of any supplemental regul ations or interpretat ions of 12 C.F .R.

1805. 20 1(b)(6) or such sup plemental regulations publishe d by the Fund. As used here in, the

term s "Affi lia tes": "Financial Products": "De velopment Services" ; "Target Marke t":

"Investment Areas"; and "Targeted Populations" have the meanings ascribed to suc h terms in 12

C. F.R. 1805104,

3. The info rm ation set forth in the CDFI Ce rtificati on Application del ive re d

to the Investor pursuant to Section 2.3(1 ) of the Standard Te rms (the "CDFf Application.Y. as

mo difie d by an y upd ates to the CDFI Application provided on [Ins erl Date(s)] by th e Cre dit

Union to the Investor on or prior to the date hereof, with re spect to the covenants set forth in

Se ction 4. 1(d)(i)( B) and Section 4.1(d)(i)(D) of the Standard Term s remai ns true , correct and

com plete as of the date he reo C.

UST Sequence No. 1390

US2 0(){) ll X'H227, I

F- l
4. The contracts and material agreements entered into by the Credit Union

with respect to Development Services previously disclosed to the Investor remain in effect and

copies of any new contracts and material agreements entered into by the Credit Union with

respect to Development Services are attached hereto as Exhibit A.

5. Attached hereto as Exhibit B is (A) a list ofthe names and addresses ofthe

individuals which comprise the board of directors of the Credit Union as of the date hereof, (B)

to the extent any member of the board of directors listed on Exhibit B was not a member of the

board of directors as of the last certification provided to the Investor pursuant to Section

4.1(d)(ii) of the Standard Terms, a narrative describing such individual's relationship to the

applicable Investment Area(s) and Targeted Population(s) and (C) to the extent the Credit Union

maintains accountability to residents of the applicable Investment Area(s) or Target

Population(s) through means other than representation on its governing board of directors and

such means have changed since the date ofthe last certification provided to the Investor pursuant

to Section 4.1(d)(ii) of the Standard Terms on [Insert Date], a narrative describing such change.

6. The Credit Union is not an agency ofthe United States of America, or any

State or political subdivision thereof, as described in 12 C.F.R. 1805.201(b)(6) and within the

meaning of any supplemental regulations or interpretations of 12 C.F .R. 1805.201 (b)(6) or such

supplemental regulations published by the Fund.

The foregoing certifications are made and delivered as of I I

---- pursuant to

Section 4.1(d)(ii) ofthe Standard Terms.

Capitalized terms used and not otherwise defined herein shall have the meanings assigned

to them in the Standard Terms.

[SIGNATURE PAGE FOLLOWS I

UST Sequence No. 1390

US200011893227.1

F-2
IN WITNESS WHEREOF, this Officer's Certificate has been duly executed and

delivered as ofthe [_J day of [ l, 20[_]

[CREDIT UNION]

By: :-:----------~----

Name:

Title:

UST Sequence No. 1390

US2000 118<)3227, I

F-3
UST Sequence No. 1390

U52000 11893227,1

EXHIBIT A

NEW CONTRACTS AND MATERIAL AGREEMENTS

Exh. A-l
EXHIBIT B

BOARD OF DIRECTORS

----- --

NAME ADDRESS NARRATIVE I

., ______.,.,c ..... _ • ...., .~

_._- ---~_..- .._.... ,._------~_._~-~.,--_._-

I _~R_~__ .~_._.."__ --

_ .._"_".o_~__ -- -_._..~~-~

1 To the extent (x) any of the individuals was not a member of the board of directors of the Credit Union

as of the last certification to the Investor, include a narrative describing such individual's relationship to

the applicable Investment Area(s) and Targeted Population(s) or, (y) if the Credit Union maintains

accountability to residents of the applicable Investment Area(s) or Target Population(s) through means

other than representation on its governing board of directors and such means have changed since the date

ofthe last certification to the Investor, a narrative describing such change.

UST Sequence No. 1390 Exh. B-1

US2000 1189i 2271
SCHEDULF: A

ADDI TIONAL TERMS AND CONDITIONS

Credit Unio n Infor mation :

Name ofthe Credit Union:

Organizatio nal Form:

Jurisdiction of Organization:

Union Bapt ist Church Federal Credit Union

Fede rally chartered credit union

United States

Appropriate Supervisory Authority: National Credit Union Administration

Notice Information:

Terms of the Purchase:

Original Aggregate Principal

Amount of Senior

Subordinated Securities in the

fo rm of Annex A purchased:I

Denomination amount:

Maturity:

Ranking:

Interest Rate:

Inter est Payment Dates:

Restricti on on Acceleration :

2200 Smith Street

Fort Wayne, IN 4680 3

Attn: Herbert Singleton

$10.00000

$1,000.00

8 yea rs

Subordinate to elaims of creditors, shareholders and

the National Credit Union Share Insurance Fund.

2% per annum unti l the eighth anniversary of the

date hereof and the reafter at a rate of 9% per

annum.

Quarterly , in arrears, February 15, May 15, August

15 and November 15 of each year.

Principal and accrued interest ma y only become

immediatel y due and payable (i.e. accelerated) upon

the occ urrence o f an Event of De fault.

I The Principal Amount shall be equal to not more than three and a half percent (3.5%) of the Credit

Union's total assets and not 111 0rc than fifty percent (50%) of the capital and surplus of the Credit Union.

UST Sequence No. 1390

l.:S2()(JO 1l 1N3H O]
Closing :

Location of Closing:

Time of Closing:

Date ofClosing:

Wire Information for Closing :

Telephonic

12:00 p.m., EST

September 24,2010

Contact for Confirmation of Wire Information:

UST Sequence No. 1390

US2000 11893340,I

-2-
SCH EDULE B

CAPITALIZAnON

Capitalization Date : August 31, 20 10

Capital Interests

Type ofInterest (Member Shares, etc): Member shares

Par Value: $1.00

Outstanding (aggregate dollar amount of Member Shares as of Capitalization Date):

$136,924 .33

Subo rdinated Debt:

Type : None

Amount Outstanding: None

Amo unt Qualifying as Secondary Capital: None

Additional Dividends (special dividends in excess ofstated dividend rates pavable on share

acco unts, etc.) Paid in 2009: None

Tot al Dividends Paid in 2009: $100

Hol ders of 5% or more of

Member Shares

Holders of Other Capital Instruments:

No ne

Primary Address

Primary Address

Describe any commitments to authorize, issue or sell Capital Interests (other than in connection

with the ordinary course issuance of shares to new memb ers):

If none , please so indicate by chec king the box: c><;J.

UST Sequence No. 1390

US2(J()O 11893340. 1
SCHEDULE C

MATERIAL ADVERSE EFFECT

List any exceptions to the representation and warranty in Section 3.1(g) of the Securities

Purchase Agreement - Standard Terms.

If none, please so indicate by checking the box: c><J.

UST Sequence No. 1390

US2000 11893340.1
SCHEDULE D

LITIGATION

List any exceptions to the representation and warranty 111 Section 3.1(1) of the Securities

Purchase Agreement - Standard Terms.

If none, please so indicate by checking the box: [g].

UST Sequence No. 1390

US2U(JO l1W!}340, 1
SCHEDULE E

COMPLIANCE WITH LAWS

List any exceptions to the representation and warranty in the second sentence of Section 3.1(m)

ofthe Securities Purchase Agreement - Standard Terms.

1f none, please so indicate by checking the box: ~.

List any exceptions to the representation and warranty in the last sentence of Section 3.1(m) of

the Securities Purchase Agreement - Standard Terms,

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

UST Sequence No. 1390

LS2000 11893340.1
SCHEDULE F

REGULATORY AGREEMENTS

List any exceptions to the representation and warranty in Section 3.1(s) of the Securities

Purchase Agreement - Standard Terms.

If none, please so indicate by checking the box: [5<:].

UST Sequence No. 1390

US200011893340.1