(CDFI Mutual Depository Institutions 

Senior Securities) 

 D-1 

ANNEX D 

FORM OF CDCI SENIOR SUBORDINATED SECURITIES

(FORM OF FACE OF SECURITY) 

“THIS CDCI SENIOR SUBORDINATED SECURITY WILL BE ISSUED AND 

MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF 

$1,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY 

ATTEMPTED TRANSFER OF 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 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 BANK 

AND THE UNITED STATES DEPARTMENT OF THE TREASURY AND 

EXCHANGE AGREEMENT – STANDARD TERMS (THE “AGREEMENT”), 

EACH OF WHICH ARE INCORPORATED INTO THIS CDCI 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 FEDERAL DEPOSIT INSURANCE 

CORPORATION. 

THIS OBLIGATION IS SUBORDINATED AND JUNIOR IN RIGHT OF 

PAYMENT, AS TO PRINCIPAL, INTEREST AND PREMIUM, TO ALL 

CLAIMS AGAINST THE BANK HAVING THE SAME PRIORITY AS 

SAVINGS ACCOUNT HOLDERS OR OTHER DEPOSITORS, OR ANY 

HIGHER PRIORITY, INCLUDING GENERAL AND SECURED CREDITORS 

OF THE BANK. THIS OBLIGATION IS NOT SECURED BY THE BANK’S 

ASSETS OR THE ASSETS OF ANY OF ITS AFFILIATES. THIS 

OBLIGATION IS NOT ELIGIBLE AS COLLATERAL FOR ANY LOAN BY 

THE BANK. 

[PURSUANT TO 12 U.S.C. 1828(b), THE BANK MAY NOT PAY INTEREST 

ON THIS OBLIGATION (IF SUCH INTEREST IS REQUIRED TO BE PAID 

ONLY OUT OF NET PROFITS) WHILE IN DEFAULT IN THE PAYMENT 

OF ANY ASSESSMENT TO THE FEDERAL DEPOSIT INSURANCE 

CORPORATION, UNLESS SUCH DEFAULT IS DUE TO A DISPUTE 
(CDFI Mutual Depository Institutions 

Senior Securities) 

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BETWEEN THE BANK AND THE FEDERAL DEPOSIT INSURANCE 

CORPORATION OVER THE AMOUNT OF SUCH ASSESSMENT AND THE 

BANK DEPOSITS SECURITY SATISFACTORY TO THE FEDERAL 

DEPOSIT INSURANCE CORPORATION FOR PAYMENT UPON FINAL 

DETERMINATION OF THE ISSUE. – to be included for OTS-regulated 

institutions only, per 12 CFR 563.81(c)(1)(i)(E)]

PURSUANT TO 12 U.S.C. 1831o(h), THE BANK MAY NOT MAKE ANY 

PAYMENT OF PRINCIPAL OR INTEREST ON THIS OBLIGATION 

BEGINNING 60 DAYS AFTER BECOMING CRITICALLY 

UNDERCAPITALIZED, UNLESS THE FEDERAL DEPOSIT INSURANCE 

CORPORATION HAS MADE AN EXCEPTION PURSUANT TO 12 

U.S.C. 1831o(h)(2)(B). 

THE TERMS UNDER WHICH THE BANK MAY PREPAY THIS CDCI 

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 MAY BE 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 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 

BANK 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. 
(CDFI Mutual Depository Institutions 

Senior Securities) 

 D-3 

[NOTWITHSTANDING THE FOREGOING, AN INDENTURE MEETING 

THE REQUIREMENTS OF 12 C.F.R. 563.81(c)(4)(i) MUST BE IN PLACE 

BEFORE THIS SECURITY IS TRANSFERRED TO ANY PERSON WHO IS 

NOT AN “ACCREDITED INVESTOR” (AS DEFINED IN RULE 501(a) 

UNDER THE SECURITIES ACT). – to be included for OTS-regulated 

institutions only, per 12 CFR 563.81(c)(4)(ii)]

THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON 

TRANSFER AND OTHER PROVISIONS OF THE AGREEMENT BETWEEN 

THE BANK AND THE INVESTOR REFERRED TO THEREIN, A COPY OF 

WHICH IS ON FILE WITH THE BANK. THIS SECURITY MAY 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.” 
(CDFI Mutual Depository Institutions 

Senior Securities) 

 D-4 

[NAME OF BANK] 

CUSIP No._________ 

$_______ 

3.1% CDCI SENIOR SUBORDINATED SECURITY DUE 2023 

[Bank], a [bank] [savings association] organized in mutual form under the laws of 

[_________] (the “Bank,” which term includes any permitted successor thereto), for value 

received, hereby promises to pay to the order of the United States Department of the Treasury or 

registered assigns, by wire transfer, the principal sum of $_____________________ 

(_________ Dollars) on ______________, 2023 (the “Maturity Date”) (or any earlier 

redemption date or date of acceleration of the Maturity Date) and to pay interest on the 

outstanding principal amount of this CDCI Senior Subordinated Security Due 2023 (this “CDCI 

Senior Subordinated Security”) (i) from _______, or from the most recent interest payment date 

to which interest has been paid or duly provided for, quarterly in arrears on February 15, May 15, 

August 15 and November 15 of each year (each such date, an “Interest Payment Date”), 

commencing on _______ _______, at the rate of 3.1% per annum, until the eighth anniversary of 

the date hereof, provided, however, that [(A)] if a CDFI Event shall have occurred and it or any 

other CDFI Event is continuing at all times, from and after the 180th day after the date on which 

the first CDFI Event occurred until the date on which no CDFI Events are continuing, the 

Interest Rate shall be 7.7% per annum, [To be inserted if Issuer was not a CDFI on February 3, 

2010: and (B) if a CDFI Event shall have occurred and it or any other CDFI Event is continuing, 

at all times, from and after the 270th day after the date on which the first CDFI Event occurred 

until the date on which no CDFI Events are continuing, 13.8% per annum] and (ii) from and after 

the eighth anniversary of the date hereof, at a rate of 13.8% per annum (each such interest rate, 

the applicable “Interest Rate”) until the principal hereof shall have been paid or duly provided 

for, compounded quarterly, and on any overdue principal and on any overdue installment of 

interest (without duplication and to the extent that payment of such interest is enforceable under 

applicable law) at the same rate per annum. The amount of interest payable hereon shall be 

computed on the basis of a 360-day year comprised of twelve 30-day months. 

This CDCI Senior Subordinated Security is one of the CDCI Senior Subordinated 

Securities referred to in the Letter Agreement and Exchange Agreement – Standard Terms, dated 

as of _______ (as amended, modified or restated from time to time, the “Agreement”), by and 

among the Bank and the United States Department of the Treasury, as the initial Investor (the 

“Investor”). Capitalized terms used in this CDCI Senior Subordinated Security are defined in the 

Agreement, unless otherwise expressly stated herein. The CDCI Senior Subordinated Security is 

entitled to the benefits of the Agreement and is subject to all of the agreements, terms and 

conditions contained therein, all of which are incorporated herein by this reference. This CDCI 

Senior Subordinated Security may be redeemed, in whole or in part, in accordance with the terms 

and conditions set forth in the Agreement. 
(CDFI Mutual Depository Institutions 

Senior Securities) 

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Interest

The interest installment so payable, and punctually paid or duly provided for, on 

any Interest Payment Date will be paid to the person in whose name this CDCI Senior 

Subordinated Security is registered at the close of business on the regular record date for such 

installment of interest, which date shall be at the close of business on the 1st calendar day 

(whether or not a business day) of the month in which each Interest Payment Date occurs (each 

such date, the “Regular Record Date”). Any such installment of interest not punctually paid or 

duly provided for shall forthwith cease to be payable to the Holders on such Regular Record 

Date and shall be paid to the person in whose name this CDCI Senior Subordinated Security is 

registered at the close of business on the date preceding the next Interest Payment Date, on the 

next Interest Payment Date, along with all other amounts then due and payable. In no event, 

however, shall interest exceed the maximum rate permitted by applicable law. 

If an Interest Payment Date 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 business 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 Interest Payment Date or Maturity 

Date, as the case may be. Interest payable on the Maturity Date of the CDCI 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 CDCI Senior Subordinated Security shall be payable upon 

surrender hereof and interest on this CDCI Senior Subordinated Security shall be payable at the 

office or agency of the Bank or an agent appointed for that purpose in any coin or currency of the 

United States of America that at the time of payment is legal tender for payment of public and 

private debts; provided, however, that payment of interest shall be made by the Bank to the 

Holders of this CDCI Senior Subordinated Security entitled thereto as shown on the CDCI 

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. 

Subordination

The indebtedness evidenced by this CDCI Senior Subordinated Security is, to the 

extent provided in the Agreement, senior to the claims of holders of Capital Interests and holders 

of shares of equity in the Bank (if and upon conversion of the Bank to a stock-based entity) 

arising as a result of their status as holders of such Capital Interests or shares of equity, and 

subordinate and junior in right of payment to all deposit liabilities of the Bank and to the Bank’s 

debt obligations to its general and secured creditors, unless such debt obligations are explicitly 

made pari passu or subordinated to the CDCI Senior Subordinated Securities, in accordance with 

regulations of the Appropriate Federal Banking Agency, if applicable. Each Holder of this CDCI 

Senior Subordinated Security, by accepting the same agrees to and shall be bound by such 

provisions of the Agreement. Each Holder hereof, by his or her acceptance hereof, hereby 

waives all notice of the acceptance of the subordination provisions contained herein and in the 
(CDFI Mutual Depository Institutions 

Senior Securities) 

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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 CDCI Senior Subordinated Security are 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 Bank has caused this instrument to be duly 

executed this ____________ day of ____________, __________. 

[NAME OF COMPANY] 

By: ____________________________________ 

Name: 

Title: 

Attest: 

By: ____________________________________ 

Name: 

Title: 
(CDFI Mutual Depository Institutions 

Senior Securities) 

 D-7 

(FORM OF REVERSE OF SECURITY) 

This CDCI Senior Subordinated Security is one of the CDCI Senior Subordinated 

Securities of the Bank (herein sometimes referred to as the “CDCI Senior Subordinated 

Securities”), issued or to be issued under and pursuant to a Letter Agreement and Exchange 

Agreement – Standard Terms, dated as of _______ , 2010 (as amended, modified or restated 

from time to time, the “Agreement”), by and between the Bank 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 Bank and the Holders of the CDCI Senior Subordinated Securities. 

This CDCI Senior Subordinated Security is a single series note with a face value in aggregate 

principal amount as set forth on the front of this CDCI Senior Subordinated Security. 

Defaults and Remedies

If an Event of Default as provided for under Section 7.1 of the Agreement occurs, 

then the principal of, interest accrued on, and other obligations payable under this CDCI 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 7.2 of the 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 Bank under this CDCI Senior Subordinated Security or the Agreement. 

Amendment and Waiver

No amendment, modification, termination or waiver of any provision of the 

Agreement, the CDCI Senior Subordinated Securities or any of the other Transaction 

Documents, or consent to any departure by the Bank therefrom, shall be effective unless made in 

writing and signed by an officer or a duly authorized representative of the Bank, and in the case 

of the CDCI Senior Subordinated Securities, the Majority Holders; provided that for so long as 

the CDCI Senior Subordinated Securities are outstanding, the Investor may at any time and from 

time to time unilaterally 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 changes 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 CDFIs, including, without 

limitation, any changes in the criteria for certification as a CDFI by the Fund; provided further

that no amendment, modification, termination or waiver with respect to the CDCI 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 CDCI 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 Bank of any of its rights and obligations under any 

Transaction Documents. 

Any such consent or waiver by the Holder of this CDCI Senior Subordinated 
(CDFI Mutual Depository Institutions 

Senior Securities) 

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Security shall be conclusive and binding upon such Holder and upon all future Holders of this 

CDCI Senior Subordinated Security and of any CDCI Senior Subordinated Security issued in 

exchange herefor or in place hereof (whether by registration of transfer or otherwise), 

irrespective of whether or not any notation of such consent or waiver is made upon this CDCI 

Senior Subordinated Security. 

No reference herein to the Agreement and no provision of this CDCI Senior 

Subordinated Security or of the Agreement shall alter or impair the obligation of the Bank, which 

is absolute and unconditional, to pay the principal of and interest on this CDCI Senior 

Subordinated Security at the time and place and at the rate and in the money herein prescribed. 

Limitation on Dividends and Repurchases of Equity Securities

The Bank’s ability to declare and pay dividends and purchase or acquire Mutual 

Capital Interests or any other equity securities of any kind of any Bank Subsidiary or any CDCI 

Senior Subordinated Security is limited by the terms of the Agreement. The Bank’s ability to 

redeem this CDCI Senior Subordinated Security is limited by the terms of the Agreement. 

Denominations; Transfer; Exchange

The CDCI Senior Subordinated Securities are issuable only in registered form 

without coupons in minimum denominations of $1,000.00 and integral multiples of $1,000.00 in 

excess thereof. As provided in the Agreement, this CDCI Senior Subordinated Security is 

transferable by the Holder hereof on the CDCI Senior Subordinated Securities Register 

maintained by the Bank or its agent, upon surrender of this CDCI Senior Subordinated Security 

for registration of transfer at the office or agency of the Bank or its agent, accompanied by a 

written instrument or instruments of transfer in form satisfactory to the Bank duly executed by 

the Holder hereof or his or her attorney duly authorized in writing, and thereupon one or more 

new CDCI Senior Subordinated Securities of authorized denominations and for the same 

aggregate principal amount will be issued to the designated transferee or transferees. No service 

charge will be made for any such registration of transfer, but the Bank may require payment of a 

sum sufficient to cover any tax or other governmental charge payable in relation thereto. 

Prior to due presentment for registration of transfer of this CDCI Senior 

Subordinated Security, the Bank and any agent thereof may deem and treat the Holder hereof as 

the absolute owner hereof (whether or not this CDCI Senior Subordinated Security shall be 

overdue and notwithstanding any notice of ownership or writing hereon made) for the purpose of 

receiving payment of or on account of the principal hereof and (subject to the Agreement) 

interest due hereon and for all other purposes, and none of the Bank or any agent thereof shall be 

affected by any notice to the contrary. 

No Recourse Against Others

No recourse shall be had for the payment of the principal of or interest on this 

CDCI Senior Subordinated Security, or for any claim based hereon, or otherwise in respect 

hereof, or based on or in respect of the Agreement or any other Transaction Document, against 

any incorporator, Mutual Interest Holder, employee, officer or director, as such, past, present or 

future, as such, of the Bank or of any successor thereto, whether by virtue of any constitution, 
(CDFI Mutual Depository Institutions 

Senior Securities) 

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statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such 

liability being, by the acceptance hereof and as part of the consideration for the issuance hereof, 

expressly waived and released. 

Governing Law

THE AGREEMENT AND THIS CDCI SENIOR SUBORDINATED 

SECURITY SHALL EACH BE GOVERNED BY, AND CONSTRUED 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. 

Abbreviations

The following abbreviations, when used in the inscription on the face of this 

CDCI Senior Subordinated Security, shall be construed as though they were written out in full 

according to applicable laws or regulations: 

TEN CON – as tenants in common TEN ENT – as tenants in the entireties 

JT TEN – as joint tenants with right of survival 

UNIF GIFT MIN ACT – under Uniform Gift to Minors Act and not as 

tenants 

Additional abbreviations may also be used though not in the above list. 
(CDFI Mutual Depository Institutions 

Senior Securities) 

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ASSIGNMENT 

FOR VALUE RECEIVED, the undersigned hereby assigns and transfers this 

CDCI Senior Subordinated Security to: 

 ____________________________________ 

(Assignee’s social security or tax 

identification number) 

 ____________________________________ 

(Address and zip code of assignee) 

and irrevocably appoints ________________ agent to transfer this CDCI Senior Subordinated 

Security on the books of the Bank. The agent may substitute another to act for him or her. 

Date: ______________________ 

Signature: ______________________________ 

(Sign exactly as your name appears on the other side of this CDCI Senior Subordinated Security) 

Signature Guarantee:______________________ 

[Signature must be guaranteed by an “eligible 

guarantor institution” that is a bank, 

stockbroker, savings and loan association or 

credit union meeting the requirements of the 

Registrar, which requirements include 

membership or participation in the Securities 

Transfer Agents Medallion Program 

(“STAMP”) or such other “signature guarantee 

program” as may be determined by the Registrar 

in addition to, or in substitution for, STAMP, all 

in accordance with the Securities Exchange Act 

of 1934, as amended.]