(CDFI BankIThrifts

Senior Preferred Stock)

UNITED STATES DEPARTMENT OF THE TREASURY

1500 PENNSYLVANIA AVENUE. NW

WASHINGTON. D.C. 20220

Dear Ladies and Gentlemen:

The company set forth on the signature page hereto (the " Comrull/ l''') intends to issue in a

private placement the number ofshares of a series ofits preferred stock set forth on Schedule A

heret o (the "Preferred Shares") and the United Slates Department of the Treasury (the

"'lIl'estO,.") intends to purchase from the Company the Preferred Shares.

The purpose of this letter agreement is to co nfinn the terms and conditions of the

purchase by the Investor of the Preferred Shares. Except to the extent supplemented or

superseded by the terms set forth herein or in the Schedules hereto. the provisions contained in

the Securities Purchase Agreement - Standard Tenns attached hereto as Exhibit A (the

"Securities Purchase Agreemem") are incorporated by reference herein. Terms that are defined

in the Securities Purchase Agreement are used in this letter agreement as so defined . In the event

of any inconsistency between this letter agreement and the Securities Purchase Agreement. the

terms ofthis letter agreement shall goycrn .

Each of thc Company and the Investor hereby con firms its agreement with the other party

with respect to the issuance by the Company of the Preferred Shares and the purchase by the

Investor of the Preferred Shares pursuant to this letter agreement and the Securities Purchase

Agreement on the terms specified on Schedule A hereto.

This letter agreement (including the Schedules hereto), the Securities Purchase

Agreement (including the Annexes thereto) and the Disclosure Schedules (as defined in the

Securities Purchase Agreement) constitute the entire agreement, and supersede all other prior

agreements. understand ings. representations and warranties, both written and oral. between the

parties. with respect to the subject matter hereof. This letter agreement constitutes the "Leiter

Agreement" referred to in the Securities Purchase Agreement.

This letter agreement may be executed in any number of separate counterparts. each such

counterpart being deemed to be an original instrument. and all such counterparts will together

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

delivered by facsimile and such facsimiles will be deemed as sufficient as if actual signature

pages had been delivered.

•• •

USTScqut'l1ce No, 551
In witness whereof, this letter been duly executed and delivered by the

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

UNITED STATES DEPARTMENT

OF THE TREASURY

By:

Name: -=~~':":'-:'=="- _

Title:

Company:

LIBERTY FINANCIAL SERVICES, INC.

By:

ALDEN J. MCDONALD, JR.

Chief Executive Officer & President

Date: Septemher 24, 2010

USTSequence No. 551
In witness whereof. this letter agreement has been duly execut ed and delivered by the

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

UNITE D STATES Il EI'AR ~I NT

OFTIIE T REASURY

Till...:

Company: _

II)·:

Na me: _

UIIERTY FINANCI AL SERVICES, INC.

II):

ALOE J. CD NA •.fR.

Chief .u cuti\"e Officer & President

Date: September _ . 20t 0

UST Sequence No. 551
US T Seq uence No, 55/

SEC URITI ES PURC HASE AGREDIEiXT

EXHIBIT A
SECURITIES PURCHASE AGREEMENT

STANDARD TERMS

EXHIBIT A

(CDFI Bank/Thrifts

Senior Preferred Stock)
TABLE OF CONTENTS

Page

ARTICLE I

1.1 Definitions 2

1.2 Interpretation 4

ARTICLE II

PURCHASE; CLOSING

2.1 Purchase .4

2.2 Closing .4

2.3 Closing Conditions 5

ARTICLE III

REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties ofthe Company 7

ARTICLEN

COVENANTS

4.1 Affirmative Covenants 16

4.2 Negative Covenants , .22

ARTICLE V

ADDITIONALAGREEMENTS

5.1 Purchase for Investment 24

5.2 Legends 24

5.3 Transfer ofPreferred Shares .25

5.4 Rule 144; Rule 144A; 4(1\1,) Transactions 26

5.5 Depositary Shares 27

5.6 Expenses and Further Assurances .27

-1-
ARTICLE VI

MISCELLANEOUS

6.1 Termination 28

6.2 Survival 29

6.3 Amendment 29

6.4 Waiver ofConditions 29

6.5 Governing Law; Submission to Jurisdiction, etc 29

6.6 Notices .30

6.7 Assignment .30

6.8 Severability .30

6.9 No Third Party Beneficiaries .31

6.10 Specific Performance .31

-11-
LIST OF ANNEXES

ANNEXA:

ANNEXB:

ANNEXC:

ANNEXD:

ANNEXE:

ANNEXF:

FORM OF OFFICER'S CERTIFICATE

FORM OF CERTIFICATE OF DESIGNATIONS FOR PREFERRED STOCK

FORM OF WAIVER

FORM OF OPINION

REGISTRATION RIGHTS

FORM OF OFFICER'S CERTIFICATE (CDFI REQUIREMENTS)

-iii-
INDEX OF DEFINED TERMS

Tenn

Affiliate

Agreement

Appropriate Federal Banking Agency

Bank Holding Company

Bankruptcy Exceptions

Benefit Plans

Board ofDirectors

Business Combination

business day

Capitalization Date

CDCI

CDFI

CDFI Application

CDFI Application Update

Certificate ofDesignations

Certified Entity

Charter

Closing

Closing Date

Code

Common Stock

Company

Company Financial Statements

Company Material Adverse Effect

Company Reports

Company Subsidiary; Company Subsidiaries

Compensation Regulations

control; controlled by; under common control with

Controlled Group

CPP

CPP/CDCI Securities

Disclosure Schedule

Disclosure Update

EESA

ERISA

Exchange Act

Federal Reserve

Fund

GAAP

Governmental Entities

Holders

Indemnitee

-ivLocation of

Definition

1.1

Recitals

1.1

1.1

3.1(e)

2.3(f)

3.l(f)

6.7

1.2

3.1(b)

Recitals

3.1(d)(ii)

2.3(m)

2.3(m)

2.3(d)

1.1

2.3(d)

2.2(a)

2.2(a)

3.1(n)

3.1(b)

Recitals

2.3 (I)

1.1

3.1(i)(i)

3.1(e)(ii)

2.3(f)

1.1

3.l(n)

3.1(x)

3.1(x)

1.1

2.3(k)

2.3(f)

3.1(n)

5.3

1.1

3.1(d)(ii)

1.1

2.3(a)

5.4(a)

5.4(b)
Information

Investor

Junior Stock

knowledge ofthe Company; Company's knowledge

Letter Agreement

MBA

officers

Parity Stock

Plan

Preferred Shares

Preferred Stock

Previously Disclosed

[Private Capital

Proprietary Rights

Purchase

Purchase Price

Regulatory Agreement

Relevant Period

Savings and Loan Holding Company

Schedules

SEC

Section 4.1(e) Employee

Securities Act

Senior Executive Officers

Share Dilution Amount

Signing Date

subsidiary

Tax; Taxes

Transfer

-v4.1(c)(iii)

Recitals

1.1

1.1

Recitals

4.l(i)

1.1

1.1

3.1(n)

Recitals

Recitals

1.1

2.3(n)]

3.1(u)

Recitals

2.1

3.l(s)

2.3(f)

1.1

Recitals

3.l(k)

4.1(e)(ii)

3.l(a)

1.1

1.1

1.1

1.1

1.1

5.3
SECURITIES PURCHASE AGREEMENT - STANDARD TERMS

Recitals:

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

from time to time agree to purchase shares of preferred stock from eligible financial institutions

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

WHEREAS, an eligible financial institution 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 financial institution identified in the Letter Agreement, the "Company");

WHEREAS, the Company agrees to support the availability of credit and

fmancial 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 Company agrees to work diligently, under existing and any

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

health ofthe U.S. housing market;

WHEREAS, the Company intends to issue in a private placement the number of

shares of the series of its Preferred Stock ("Preferred StocJ(') set forth on Schedule A to the

Letter Agreement (the "Preferred Shares") and the Investor intends to purchase (the "Purchase")

from the Company the Preferred Shares; 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 ofthe Purchase. This Securities Purchase Agreement -

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

Schedules thereto) are 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

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

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 Federal Banking Agency" means the "appropriate Federal banking

agency" with respect to the Company or such Company Subsidiaries, as applicable, as defined in

Section 3(q) ofthe Federal Deposit Insurance Act (12 U.S.C. Section 1813(q».

"Bank Holding Company" means a company registered as such with the Board of

Governors of the Federal Reserve System (the "Federal Reserve") pursuant to 12 U.S.C. §1842

and the regulations ofthe Federal Reserve promulgated thereunder.

"Certified Entity" means the Company or, if the Company itself has not been

certified by the Fund as a CDFI, each Affiliate of the Company that has been certified by the

CDFI and is specified on Schedule A ofthe Letter Agreement.

"Company Material Adverse Effect" means a material adverse effect on (i) the

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

subsidiaries and each Certified Entity taken as a whole; provided, however, that Company

Material Adverse Effect shall not be deemed to include the effects of (A) changes after the date

ofthe 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 Company

and its subsidiaries operate, (B) changes or proposed changes after the Signing Date in generally

accepted accounting principles in the United States ("GAAP") 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 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 Company and its consolidated subsidiaries

taken as a whole relative to comparable U.S. banking or financial services organizations); or (ii)

the ability of the Company to consummate the Purchase and other transactions contemplated by

this Agreement and perform its obligations hereunder or thereunder on a timely basis.

-2-
"Disclosure Schedule" means that certain schedule to this Agreement delivered to

the Investor on or prior to the Signing Date, setting 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.

"Junior Stock" means Common Stock and any other class or series ofstock ofthe

Company the terms of which expressly provide that it ranks junior to the Preferred Shares as to

dividend rights and/or as to rights on liquidation, dissolution or winding up ofthe Company.

"knowledge of the Company" or "Company's knowledge" means the actual

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

"Parity Stock" means any class or series of stock of the Company the terms of

which do not expressly provide that such class or series will rank senior or junior to the Preferred

Shares as to dividend rights and/or as to rights on liquidation, dissolution or winding up of the

Company (in each case without regard to whether dividends accrue cumulatively or noncumulatively).

"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

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 ofor

remedies available to the Investor.

"Savings and Loan Holding Company" means a company registered as such with

the Office of Thrift Supervision pursuant to 12 U.S.C. §1467(a) and the regulations ofthe Office

ofThrift Supervision promulgated thereunder.

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

defined in Section III ofEESA and the Compensation Regulations.

"Share Dilution Amount" means the increase in the number of diluted shares

outstanding (determined in accordance with GAAP, and as measured from the date of the

Company's most recent consolidated financial statements prior to the Closing Date) resulting

from the grant, vesting or exercise of equity-based compensation to employees and equitably

adjusted for any stock split, stock dividend, reverse stock split, reclassification or similar

transaction.

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

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

partner or (y) ofwhich a majority ofthe voting securities or other voting interests, or a majority

ofthe securities or other interests ofwhich having by their terms ordinary voting power to elect a

-3-
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,

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

interest, penalty or addition imposed by any Governmental Entity.

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 ofthis 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 any 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

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

Agreement, the Company agrees to sell to the Investor, and the Investor agrees to purchase from

the Company, at the Closing (as hereinafter defined), the Preferred Shares for the price set forth

on Schedule A (the "Purchase Price").

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 be agreed between the Company and the

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

"Closing Date".

-4-
(b) Subject to the fulfillment or waiver of the conditions to the Closing in

Section 2.3, at the Closing the Company will deliver the Preferred Shares as evidenced by one or

more certificates 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 designated by the Company on Schedule A.

2.3 Closing Conditions. The obligation of the Investor to consunnnate 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

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

for the consunnnation 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 ofthe Preferred Shares as

contemplated by this Agreement;

(b) (i) the representations and warranties of the Company set forth in

Section 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 ofsuch other date) and

(ii) the Company 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 Company shall have delivered to the Investor a certificate signed on

behalf ofthe Company 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

AnnexA;

(d) the Company shall have duly adopted and filed with the Secretary of State

of its jurisdiction of organization or other applicable Governmental Entity an amendment to its

certificate or articles ofincorporation, articles of association, or similar organizational document

("Charter") in substantially the form attached hereto as Annex B (the "Certificate of

Designations") and the Company shall have delivered to the Investor a copy of the filed

Certificate of Designations with appropriate evidence from the Secretary of State or other

applicable Governmental Entity that the filing has been accepted, or if a filed copy is

unavailable, a certificate signed on behalf of the Company by a Senior Executive Officer

certifying to the effect that the filing of the Certificate of Designation has been accepted, in

substantially the form attached hereto as Annex A;

(e) the Company shall have delivered to the Investor true, complete and

correct certified copies ofthe Charter and bylaws ofthe Company;

(f) (i) the Company shall have effected such changes to its compensation,

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

-5-
parachute, severance and employment agreements) (collectively, "Benefit Plans") with respect to

its Senior Executive Officers and any other employee ofthe Company or its Affiliates subject to

Section 111 ofthe Emergency Economic Stabilization Act of2008, 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

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

which any obligation ofthe Company 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 111 of

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

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

condition set forth in Section 2.3(1)(i) has been satisfied, in substantially the form attached hereto

as AnnexA;

(g) each ofthe Company's Senior Executive Officers and any other employee

of the Company or its Affiliates subject to Section 111 of EESA shall have delivered to the

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

Company from any claims that such Senior Executive Officer or other employee may otherwise

have as a result of the modification of, or the agreement of the Company 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 ofEESA as implemented by the Compensation Regulations;

(h) the Company shall have delivered to the Investor a written opinion from

counsel to the Company (which may be internal counsel), addressed to the Investor and dated as

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

(i) the Company shall have delivered certificates in proper form or, with the

prior consent of the Investor, evidence of shares in book-entry form, evidencing the Preferred

Shares to Investor or its designee(s);

(j) the Company and the Company Subsidiaries shall have taken all necessary

action to ensure that the Company and the Company Subsidiaries and their executive officers,

respectively, are 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 ofFebruary 17, 2009, and all rules, regulations and guidance issued thereunder;

(k) the Company shall have delivered to the Investor a copy ofthe Disclosure

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

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

as of the Closing Date, (i) the Company shall have 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

-6-
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;

(I) the Company shall have delivered to the Investor on or prior to the

Signing Date each ofthe consolidated financial statements of the Company and its consolidated

subsidiaries for each of the last three completed fiscal years of the Company (which shall be

audited to the extent audited fmancial statements are available prior to the Signing Date) and

each completed quarterly period since the last completed fiscal year (collectively, the "Company

Financial Statements"); and

(m) the Company shall have delivered to the Investor prior to the Signing Date

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

each Certified Entity 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 ofthe Signing Date or (ii), to the extent a copy ofthe CDFI Certification Application

that any Certified Entity submitted to the Fund in connection with its certification as a CDFI is

not available, a newly completed CDFI Certification Application with respect to such Certified

Entity true, complete and correct as of the Signing Date (the CDFI Certification Application

delivered to the Investor pursuant to this Section 2.3(m), the "CDFI 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 Company shall have delivered to the Investor an update to the CDFI

Application (the "CDFI Application Update"), setting forth any information necessary to make

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

Date. and

ARTICLE III

REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties of the Company. Except as Previously

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

as of the Closing Date (or such other date specified herein):

(a) Organization. Authority and Significant Subsidiaries. The Company has

been duly incorporated and is validly existing and in good standing 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 Company Material Adverse Effect, has been duly qualified as a foreign corporation for

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

which it owns or leases properties or conducts any business so as to require such qualification;

each Certified Entity (if not the Company) and each subsidiary of the Company 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"), has been duly organized and is validly

existing in good standing under the laws of its jurisdiction of organization. The Charter and

-7-
bylaws of the Company and each Certified Entity (if not the Company), copies of which have

been provided to the Investor prior to the Signing Date, are true, complete and correct copies of

such documents as in full force and effect as of the Signing Date and as of the Closing Date.

(b) Capitalization. The authorized capital stock of the Company, and the

outstanding capital stock ofthe Company (including securities convertible into, or exercisable or

exchangeable for, capital stock of the Company) as of the most recent fiscal month-end

preceding the Signing Date (the "Capitalization Date") is set forth on Schedule B. The

outstanding shares of capital stock of the Company have been duly authorized and are validly

issued and outstanding, fully paid and nonassessable, and subject to no preemptive rights (and

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

does not have outstanding any securities or other obligations providing the holder the right to

acquire its common stock ("Common StocR') or other capital stock that is not reserved for

issuance as specified on Schedule B, and the Company has not made any other commitment to

authorize, issue or sell any Common Stock or other capital stock. Since the Capitalization Date,

the Company has not issued any shares of Common Stock or other capital stock, other than

(i) shares issued upon the exercise ofstock options or delivered under other equity-based awards

or other convertible securities or warrants which were issued and outstanding on the

Capitalization Date and disclosed on Schedule B, and (ii) shares disclosed on Schedule B. Each

holder of 5% or more of any class of capital stock ofthe Company and such holder's primary

address are set forth on Schedule B.

(c) Preferred Shares. The Preferred Shares have been duly and validly

authorized, and, when issued and delivered pursuant to this Agreement, such Preferred Shares

will be duly and validly issued and fully paid and non-assessable, will not be issued in violation

of any preemptive rights, and will rank pari passu with or senior to all other series or classes of

Preferred Stock, whether or not designated, issued or outstanding, with respect to the payment of

dividends and the distribution of assets in the event of any dissolution, liquidation or winding up

ofthe Company.

(d) Community Development Financial Institution Status; Domestic

Ownership.

(i) The Company collectively with all of its "Affiliates" (within the

meaning of 12 C.F.R. 1805.104) satisfies the requirements ofl2 C.F.R. 1805.200(b).

(ii) Each Certified Entity (A) 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 ofthe Fund's Community Development Financial Institutions Program

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

1805.201 (b)(l) - (6).

(iii) The Company is not a Bank Holding Company, Savings and Loan

Holding Company, bank or savings association controlled (within the meaning ofthe

Bank Holding Company Act of 1956 (12 U.S.c. I841(a)(2)) and 12 C.F.R. 225(a)(i)

-8-
in the case ofBank Holding Companies and banks and the Home Owners' Loan Act

of 1933 (12 U.S.C. 1467a (a)(2)) and 12 C.F.R. 583.7 in the case of Savings and

Loan Holding Companies and savings associations) by a foreign bank or company.

(e) Authorization, Enforceability.

(i) The Company has the corporate power and authority to execute and

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

issuance of the Preferred Shares). The execution, delivery and performance by the

Company ofthis Agreement and the consummation ofthe transactions contemplated

hereby have been duly authorized by all necessary corporate action on the part ofthe

Company and its stockholders, and no further approval or authorization is required

on the part ofthe Company. This Agreement is a valid and binding obligation ofthe

Company enforceable against the Company in accordance with its terms, subject to

any limitations 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 ("Bankruptcy Exceptions").

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

Agreement and the consummation of the transactions contemplated hereby and

compliance by the Company 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 oftermination or acceleration of, or result in the creation of, any lien, security

interest, charge or encumbrance upon any ofthe properties or assets ofthe Company

or any subsidiary of the Company or Certified Entity (if not the Company) (each

subsidiary or Certified Entity, a "Company Subsidiary" and, collectively, the

"Company Subsidiaries") under any of the terms, conditions or provisions of (x) its

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

license, lease, agreement or other instrument or obligation to which the Company or

any Company Subsidiary is a party or by which it or any Company Subsidiary may

be bound, or to which the Company or any Company Subsidiary or any of the

properties or assets ofthe Company or any Company 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 Company or any Company Subsidiary or any

of their respective properties or assets except, in the case 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 Company Material Adverse Effect.

(iii) Other than the filing of the Certificate of Designations with the

Secretary of State of its jurisdiction of organization or other applicable

Governmental Entity, such filings and approvals as are required to be made or

obtained under any state "blue sky" laws and such as have been made or obtained,

no notice to, filing with, exemption or review by, or authorization, consent or

-9-
approval of, any Governmental Entity is required to be made or obtained by the

Company in connection with the consummation by the Company 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 Company Material Adverse Effect.

(f) Anti-takeover Provisions and Rights Plan. The Board of Directors of the

Company (the "Board ofDirectors") has taken all necessary action to ensure that the transactions

contemplated by this Agreement and the consummation ofthe transactions contemplated hereby

will be exempt from any anti-takeover or similar provisions of the Company's Charter and

bylaws, and any other provisions of any applicable "moratorium", "control share", "fair price",

"interested stockholder" or other anti-takeoverlaws and regulations of any jurisdiction.

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

completed fiscal period for which financial statements are included in the Company 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 Company Material Adverse Effect, except as disclosed on Schedule C.

(h) Comoanv Financial Statements. The Company Financial Statements

present fairly in all material respects the consolidated financial position of the Company and its

consolidated subsidiaries as of the dates indicated therein and the consolidated results of their

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

statements (i) were prepared in conformity with GAAP 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 ofthe Company and the Company Subsidiaries.

(i) Reports.

(i) Since December 31, 2008, the Company and each Company

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

submissions, together with any amendments thereto, that it was required to file with

any Governmental Entity (the foregoing, collectively, the "Company 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 Company Material Adverse Effect. As oftheir respective dates of filing, the

Company Reports complied in all material respects with all statutes and applicable

rules and regulations ofthe applicable Governmental Entities.

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

and the Company 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 control ofthe

Company or the Company Subsidiaries or their accountants (including all means of

access thereto and therefrom), except for any non-exclusive ownership and nondirect control that would not reasonably be expected to have a material adverse

effect on the system of internal accounting controls described below in this

-10-
Section 3.1(i)(ii). The Company (A) has implemented and maintains adequate

disclosure controls and procedures to ensure that material information relating to the

Company, including the consolidated Company Subsidiaries, is made known to the

chief executive officer and the chief financial officer of the Company by others

within those entities, and (B) has disclosed, based on its most recent evaluation prior

to the Signing Date, to the Company's outside auditors and the audit cornmittee of

the Board of Directors (x) any significant deficiencies and material weaknesses in

the design or operation of internal controls that are reasonably likely to adversely

affect the Company'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 Company's internal controls over

financial reporting.

G) No Undisclosed Liabilities. Neither the Company nor any of the

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

contingent or otherwise) which are not properly reflected or reserved against in the Company

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 Company

Material Adverse Effect.

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

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

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

the Preferred Shares under the Securities Act, and the rules and regulations ofthe Securities and

Exchange Commission (the "SEC') promulgated thereunder), which might subject the offering,

issuance or sale of any of the Preferred Shares to Investor pursuant to this Agreement to the

registration requirements ofthe Securities Act.

(1) Litigation and Other Proceedings. Except (i) lIS set forth on Schedule D or

(ii) as would not, individually or in the aggregate, reasonably be expected to have a Company

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

threatened, claim, action, suit, investigation or proceeding, against the Company or any

Company Subsidiary or to which any of their assets are subject nor is the Company or any

Company 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 Company or any Company Subsidiaries.

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

aggregate, reasonably be expected to have a Company Material Adverse Effect, the Company

and the Company 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 carry on their business as presently conducted and that are material to the business of the

Company or such Company Subsidiary. Except as set forth on Schedule E, the Company and the

Company Subsidiaries have complied in all respects and are not in default or violation of, and

-11-
none ofthem is, to the knowledge ofthe Company, under investigation with respect to or, to the

knowledge of the Company, 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 Company 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 Company or any Company Subsidiary that would, individually or in the

aggregate, reasonably be expected to have a Company Material Adverse Effect.

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

to have, either individually or in the aggregate, a Company 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 Company 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 ofthe Internal Revenue Code of 1986, as amended (the "Code"» that is

sponsored, maintained or contributed to by the Company or any member ofits Controlled Group

and for which the Company or any member of its Controlled Group would have 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, including ERlSA and

the Code; (ii) with respect to each Plan subject to Title IV of ERlSA (including, for purposes of

this clause (ii), any plan subject to Title IV of ERlSA that the Company or any member of its

Controlled Group previously maintained or contributed to in the six years prior to the Signing

Date), (1) no "reportable event" (within the meaning of Section 4043(c) ofERlSA), other than a

reportable event for which the notice period referred to in Section 4043(c) of ERlSA has been

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

occur, (2) no "accumulated funding deficiency" (within the meaning of Section 302 ofERlSA 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, (3) 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 (4) neither the Company 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 ofERlSA (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 "multiemployer plan", within the meaning of Section

400l(c)(3) ofERlSA); and (iii) each Plan that is intended to be qualified under Section 40l(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 ofsuch qualified status or favorable determination letter.

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

be expected to have a Company Material Adverse Effect, (i) the Company and the Company

-12-
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 Company or any of the Company Subsidiaries, nor does the

Company 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 Company Material Adverse Effect, the Company

and the Company 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 Company Material Adverse Effect, the

Company and the Company 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

thereofby them.

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

aggregate, reasonably be expected to have a Company 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 Company or any Company 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 Company's knowledge, threatened against the Company or any Company

Subsidiary;

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

such proceeding, claim or action; and

(iii) neither the Company nor any Company Subsidiary is subject to any

agreement, order, judgment or decree by or with any court, Goverrnnental Entity or

third party imposing any such environmental liability.

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

the aggregate, reasonably be expected to have a Company Material Adverse Effect, all derivative

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

Company's own account, or for the account of one or more ofthe Company 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 ofsuch instruments constitutes the valid and legally binding obligation ofthe Company

or one ofthe Company Subsidiaries, enforceable in accordance with its terms, except as may be

-13-
limited by the Bankruptcy Exceptions. Neither the Company or the Company Subsidiaries, nor,

to the knowledge of the Company, 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 Company Material Adverse Effect.

(s) Agreements with Regulatory Agencies. Except as set forth on Schedule F,

neither the Company nor any Company 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

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

"Regulatory Agreement"), nor has the Company or any Company 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 Company and each Company

Subsidiary is in compliance in all material respects with each Regulatory Agreement to which it

is party or subject, and neither the Company nor any Company Subsidiary has received any

notice from any Governmental Entity indicating that either the Company or any Company

Subsidiary is not in compliance in all material respects with any such Regulatory Agreement.

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

reputable insurers against such risks and in such amounts as the management of the Company

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

and the Company Subsidiaries are in material compliance with their insurance policies and are

not in default under any ofthe material terms thereof, each such policy is outstanding and in full

force and effect, all premiums and other payments due under any 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 Company Material

Adverse Effect.

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

aggregate, reasonably be expected to have a Company Material Adverse Effect, (i) the Company

and each Company Subsidiary owns or otherwise has the right to use, all intellectual property

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 ofits 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 Company nor any of the Company Subsidiaries is materially infringing, diluting,

misappropriating or violating, nor has the Company or any ofthe Company Subsidiaries received

any written (or, to the knowledge of the Company, oral) communications alleging that any of

them has materially infringed, diluted, misappropriated or violated, any ofthe Proprietary Rights

owned by any other person. Except as would not, individually or in the aggregate, reasonably be

-14-
expected to have a Company Material Adverse Effect, to the Company's knowledge, no other

person is infringing, diluting, misappropriating or violating, nor has the Company or any or the

Company 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 Company and the Company 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,

finder'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 Company or any

Company Subsidiary.

(w) Disclosure Schedule. The Company 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.

(x) CPP/CDCI Securities. To the extent that the Company participated in the

Troubled Asset Relief Program Capital Purchase Program ("CPP") or the CDCI prior to the

Signing Date and the Company has any Preferred Stock or other securities issued in connection

with its participation in the CPP or the CDCI (the "CPP/CDCI Securities") outstanding, the

Company has (i) not breached any representation, warranty or covenant set forth in any of the

documents governing the CPP/CDCI Securities or its sale to Investor and (ii) paid to Investor: all

accrued and unpaid dividends and/or interest then due on the CPP/CDCI Securities.

ARTICLE IV

COVENANTS

4.1 Affirmative Covenants. The Company hereby covenants and agrees with

Investor that:

(a) Commercially 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 be done, all things necessary, proper

or desirable, or advisable under applicable laws, so as to permit consunnnation 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 Company 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 ofthe Company contained in this Agreement to be untrue or inaccurate in any material

respect or to cause any covenant or agreement ofthe Company contained in this Agreement not

to be 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

-15-
Company is aware and which, individually or in the aggregate, has had or would reasonably be

expected to have a Company Material Adverse Effect; provided, however, that delivery of any

notice pursuant to this Section 4.1(b) shall not limit or affect any rights of or remedies available

to the Investor.

(c) Access, Information and Confidentiality.

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

amount of Preferred Shares having an aggregate liquidation value of less than 10%

of the Purchase Price, the Company will permit the Investor and its agents,

consultants, contractors and advisors (x) acting through the Appropriate Federal

Banking Agency, or otherwise to the extent necessary to evaluate, manage, or

transfer its investment in the Company, to examine the corporate 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 Company and the Company Subsidiaries with

the principal officers of the Company, all upon reasonable 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 Company

provided by the Company to its Appropriate Federal Banking Agency. Any

investigation pursuant to this Section 4.1(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 Company, and nothing herein shall require the Company or

any Company 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 Company

or any Company Subsidiary is a party or would cause a risk of a loss of privilege to

the Company or any Company Subsidiary (provided that the Company shall use

commercially reasonable efforts to make appropriate substitute disclosure

arrangements under circumstances where the restrictions in this clause (i) apply).

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

Shares have been redeemed in whole, the Company 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

Company, and in any event within 90 days thereafter, a consolidated balance

sheet of the Company as of the end of such fiscal year, and consolidated

statements of income, retained earnings and cash flows of the Company for such

year, in each case prepared in accordance with GAAP and setting forth in each

case in comparative form the figures for the previous fiscal year ofthe Company

and which shall be audited to the extent audited fmancial statements are available;

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

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

reports provided to other stockholders ofthe Company or Company management

by the Company;

-16-
(C) as soon as available after the Company receives any assessment of

the Company'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 Company has utilized the funds the Company received hereunder in

connection with the sale ofthe Preferred Shares and the effects of such funds on

the operations and status ofthe Company;

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

Charter, bylaws or other organizational documents ofthe Company; and

(F) at the same time as such items are sent to any stockholders of the

Company, copies of any information or documents sent by the Company to its

stockholders.

(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 (collectively, "Information") concerning the Company furnished or

made available to it by the Company or its representatives pursuant to this

Agreement (except to the extent that such information can be shown to have been (i)

previously known by such party on a non-confidential basis, (ii) in the public

domain through no fault of such party or (iii) 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 applicable 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 from a Freedom ofInformation Act request.

(iv) The Investor's information rights pursuant to Section 4.1(c)(ii)(A),

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

Company pursuant to Section 4.1(d)(ii) may be assigned by the Investor to a

transferee or assignee ofthe Preferred Shares with a liquidation preference of no less

than an amount equal to 2% of the iuitial aggregate liquidation preference of the

Preferred Shares.

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

owns any Preferred Shares, the Company shall permit, and shall cause each of the

Company's Subsidiaries to permit (A) the Investor and its agents, consultants,

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

Relief Program, and (C) the Comptroller General of the Uuited 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

-17-
Special Inspector General ofthe 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

from the public version ofits reports and soliciting the input from the Company 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 of the United States or any other applicable regulatory authority has under

law.

(d) CDFI Requirements.

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

Shares have been redeemed in whole, each Certified Entity shall (A) be certified by

the Fund as a CDFI; (B) together with 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. 1805.201(b)(1); (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 governing Board of

Directors or otherwise; and (H) remain a non-governmental entity which is not an

agency or instrwnentality 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 Section 4.1(d), the terms

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

"InvestmentAreas"; 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 Preferred

Shares have been redeemed in whole, the Company shall deliver to Investor (1) (x)

on the date that is 180 days after the Closing Date and (y) annually on the same date

on which the Company delivers the documentation required under Section

4.1(c)(ii)(A) to the Investor, a certificate signed on behalf of the Company by a

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

certif'ying (A) that the Company and each Certified Entity remains in compliance

with the covenants set forth in Section 4.1(d)(i); (B) that the information in the CDFI

-18-
Application, as modified by any updates to the CDFI Application provided by the

Company to the Investor on or prior to the date of such certificate, with respect to

the covenants set forth in Section 4.1(d)(i)(B) and Section 4.1(d)(i)(D) remains true,

correct and complete as of such date or, to the extent any information set forth in the

CDFI Application, as modified by any updates to the CDFI Application provided by

the Company to the Investor on or prior to the date of such 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 each Certified Entity 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

Certified Entity with respect to Development Services; (D) a list of the names and

addresses ofthe individuals which comprise the board of directors of each Certified

Entity as ofsuch date and, to the extent any ofsuch individuals was not a member of

the board of directors of such Certified Entity as of the last certification to the

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

Investment Area(s) and Targeted Population(s) or, ifsuch Certified Entity 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; (E) that each Certified Entity 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 and (F) that the Company remains

in compliance with the covenants set forth in Section 4.1(1) and Section 4.1(m) and

(2) within five (5) business days ofreceipt, copies of any notices, correspondence or

other written communication between each Certified Entity and the Fund, including

any form that such Certified Entity 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 Company shall immediately notify the Investor upon the

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

(e) Executive Compensation.

(i) Benefit Plans. During the Relevant Period, the Company shall take

all necessary action to ensure that the Benefit Plans of the Company and its

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

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

Regulations, and neither the Company 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

-19-
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 then-existing Benefit Plans, or that

requires other actions, the Company 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 4.1(e) (and shall be deemed to be in compliance for a reasonable

period to effect such changes). In addition, the Company 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 equity-based awards, deferred cash awards or any

nonqualified deferred compensationpayable by the Company or any of its Affiliates.

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

hiring or promotion of a Section 4.1(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 Company shall use its best efforts to (x) obtain from such Section

4.1(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 4.1(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 Company or any of its Affiliates determined at

any time to be subject to Section 111 ofEESA as implemented by the Compensation

Regulations.

(iii) Clawback. In the event that any Section 4.1(e) Employee receives a

payment in contravention of the provisions ofthis Section 4.1(e), the Company shall

promptly provide such individual with written notice that the amount of such

payment must be repaid to the Company 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 4.1(e) has been made and

(y) following the repayment to the Company of such amount, and shall take such

other actions as may be necessary to comply with the Compensation Regulations.

(iv) Limitation on Deductions. During the Relevant Period, the Company

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) of the Code applied to the Company.

(f) Bank and Thrift Holding Company Status. If the Company is a Bank

Holding Company or a Savings and Loan Holding Company on the Signing Date, then the

Company shall maintain its status as a Bank Holding Company or Savings and Loan Holding

-20-
Company, as the case may be, for as long as the Investor owns any Preferred Shares. The

Company shall redeem all Preferred Shares held by the Investor prior to terminating its status as

a Bank Holding Company or Savings and Loan Holding Company, as applicable.

(g) Predominantly Financial. For as long as the Investor owns any Preferred

Shares, the Company, to the extent it is not itself an insured depository institution, agrees to

remain predominantly engaged in financial activities. A company is predominantly engaged in

financial activities if the annual gross revenues derived by the company and all subsidiaries of

the company (excluding revenues derived from subsidiary depository institutions), on a

consolidated basis, from engaging in activities that are fmancial 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 ofthe consolidated annual gross revenues ofthe

company.

(h) Capital Covenant. From the Signing Date until the date on which all of

the Preferred Shares have been redeemed in whole, the Company and the Company Subsidiaries

shall maintain such capital as may be necessary to meet the minimum capital requirements ofthe

Appropriate Federal Banking Agency, as in effect from time to time.

(i) HAMP Modifications. The Company shall take all necessary action to

ensure that (A) from and after the date the Company or any Company 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 Company or

such Company Subsidiary shall, to the extent such programs are open for participation, (I)

participate in the United States Department of the Treasury's Making Home Affordable

("MHA") program, including MHA's Second Lien Modification Program and (2) immediately

execute a Commitment to Purchase Financial Instrument and Servicer Participation Agreement

(in such form as may be set forth on the MHA website at www.hmpadmin.com from time to

time) with Fannie Mae (acting as the United States Department of the Treasury's fiscal agent)

. and (B) ifthe Company or any Company Subsidiary owns mortgage loans that are serviced by a

non-affiliated mortgage servicer, the Company or such Company Subsidiary shall consent to any

MHA modification request made by such mortgage servicer.

(j) Reporting Requirements. Prior to the date on which all of the Preferred

Shares have been redeemed in whole, the Company covenants and agrees that, at all times on or

after the Closing Date, (i) to the extent it is subject to the reporting requirements of Section 13 or

15(d) ofthe Exchange Act, it shall comply with the terms and conditions set forth in Annex E or

(ii) as soon as practicable after the date that the Company becomes subject to the reporting

requirements of Section 13 or 15(d) of the Exchange Act, it shall comply with the terms and

conditions set forth in Annex E.

(k) Compliance with Emplov American Workers Act. The Company shall

agree to comply, and take all necessary action to ensure that any Company Subsidiary complies,

in all respects with 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, as implemented by any rules, regulation or guidance thereunder, as such may be amended

-21-
or supplemented from time to time, and any applicable guidance ofthe United States Department

ofthe Treasury with respect thereto.

(I) Transfer of Proceeds to Certified Entities. If the Company is not a

Certified Entity, the Company shall immediately transfer to its related Certified Entities, as

capital contributions, any proceeds it receives in connection with the sale ofPreferred Shares.

(m) Control by Foreign Bank or Company. Prior to the date on which all of

the Preferred Shares have been redeemed in whole, the Company shall not be controlled (within

the meaning of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)(2)) and 12 C.F.R.

225(a)(i) in the case ofBank Holding Companies and banks and the Home Owners' Loan Act of

1933 (12 U.S.C. 1467a(a)(2)) and 12 C.F.R. 583.7 in the case of Savings and Loan Holding

Companies and savings associations) by a foreign bank or company.

4.2 Negative Covenants. The Company hereby covenants and agrees with the

Investor that:

(a) Certain Transactions.

(i) The Company 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 Company), 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 Company.

(ii) Without the prior written consent of the Investor, until such time as

the Investor shall cease to own any Preferred Shares, the Company shall not permit

any of its "significant subsidiaries" (as such term is defined in Rule 12b-2

promulgated under the Exchange Act) to (A) engage in any merger, consolidation,

statutory share exchange or similar transaction following the consummation of

which such significant subsidiary is not wholly-owned by the Company, (B) dissolve

or sell all or substantially all of its assets or property other than in connection with

an internal reorganization or consolidation involving wholly-owned subsidiaries of

the Company or (C) issue or sell any shares of its capital stock or any securities

convertible or exercisable for any such shares, other than issuances or sales in

connection with an internal reorganization or consolidation involving wholly-owned

subsidiaries ofthe Company.

(b) Restriction on Dividends and Repurchases.

(i) The Company covenants and agrees that it shall not violate any ofthe

restrictions on dividends, distributions, redemptions, repurchases, acquisitions and

related actions set forth in the Certificate ofDesignations, which are incorporated by

reference herein as ifset forth in full.

-22-
(ii) During the period beginning on the eighth anniversary ofthe Closing

and ending on the date on which the Investor no longer owns any of the Preferred

Shares, neither the Company nor any Company Subsidiary shall, without the consent

ofthe Investor, (A) declare or pay any dividend or make any distribution on capital

stock or other equity securities of any kind of the Company or any Company

Subsidiary; or (B) redeem, purchase or acquire any shares of Common Stock or

other capital stock or other equity securities of any kind of the Company or any

Company Subsidiary, or any trust preferred securities issued by the Company or any

Affiliate ofthe Company, other than (1) redemptions, purchases or other acquisitions

of the Preferred Shares, (2) regular dividends on shares of preferred stock in

accordance with the terms thereof and which are permitted under the terms of the

Preferred Shares, or (3) dividends or distributions by any wholly-owned Company

Subsidiary.

(c) Related Party Transactions. Until such time as the Investor ceases to own

any debt or equity securities ofthe Company, including the Preferred Shares, the Company and

the Company Subsidiaries shall not enter 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 Company and the Company 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 ofindependent directors ofthe Company, or ifthere

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 ofPreferred Shares Not Held by Investor. Prior

to the date on which the Investor no longer owns any ofthe Preferred Shares the Company shall

not repurchase, redeem, call or otherwise reacquire any Preferred Shares 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 of the Preferred

Shares, as the case may be, then held by the Investor on the same terms and conditions.

ARTICLE V

ADDITIONAL AGREEMENTS

5.1 Purchase for Investment. The Investor acknowledges that the Preferred

Shares have not been registered under the Securities Act or under any state securities laws. The

Investor (a) is acquiring the Preferred Shares pursuant to an exemption from registration under

the Securities Act solely for investment with no present intention to distribute them to any person

in violation ofthe Securities Act or any applicable U.S. state securities laws, (b) will not sell or

otherwise dispose of any of the Preferred Shares, 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 ofthis type that it is capable of evaluating the merits and risks ofthe Purchase and

ofmaking an informed investment decision.

-23-
5.2 Legends. (a) The Investor agrees that all certificates or other instruments

representing the Preferred Shares will bear a legend substantially to the following

effect:

"THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE NOT

SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF A BANK

AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE

CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE 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 THE SECURITIES REPRESENTED BY

THIS INSTRUMENT 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 THE

SECURITIES REPRESENTED BY THIS INSTRUMENT 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 ELIGffiLE 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 ISSUER 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 THE SECURITIES REPRESENTED BY THIS

INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO

THE EFFECT OF THIS LEGEND.

THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON

TRANSFER AND OTHER PROVISIONS OF A SECURITIES PURCHASE

AGREEMENT BETWEEN THE ISSUER OF THESE SECURITIES AND THE

INVESTOR REFERRED TO THEREIN, A COpy OF WHICH IS ON FILE

-24-
WITH THE ISSUER. THE SECURITIES REPRESENTED BY THIS

INSTRUMENT 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."

(b) In the event that any Preferred Shares (i) become registered under the

Securities Act or (ii) 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), the

Company shall issue new certificates or other instruments representing such Preferred Shares,

which shall not contain the applicable legends in Section 5.2(a) above; provided that the Investor

surrenders to the Company the previously issued certificates or other instruments.

5.3 Transfer of Preferred Shares. Subject to compliance with applicable

securities laws, the Investor shall be permitted to transfer, sell, assign or otherwise dispose of

("Transfer') all or a portion ofthe Preferred Shares at any time, and the Company shall take all

steps as may be reasonably requested by the Investor to facilitate the Transfer of the Preferred

Shares, including without limitation, as set forth in Section 5.4, provided that the Investor shall

not Transfer any Preferred Shares ifsuch transfer would require the Company 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 Company was not already subject to such requirements. In

furtherance ofthe foregoing, the Company shall provide reasonable cooperation to facilitate any

Transfers of the Preferred Shares, including, as is reasonable under the circumstances, by

furnishing such information concerning the Company and its business as a proposed transferee

may reasonably request and making management of the Company 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.

5.4 Rule 144; Rule I44A; 4(1Yz) Transactions. (a) At all times after the

Signing Date, the Company covenants that (I) it will, upon the request of the Investor or any

subsequent holders ofthe Preferred Shares ("Holders"), use its reasonable best efforts to (x), to

the extent any Holder is relying on Rule 144 under the Securities Act to sell any ofthe Preferred

Shares, make "current public information" available, as provided in Section (c)(I) ofRule 144 (if

the Company is a "Reporting Issuer" within the meaning of Rule 144) or in Section (c)(2) of

Rule 144 (ifthe Company is a "Non-Reporting Issuer" within the meaning ofRule 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(1Y2)" exemption to sell any of its Preferred

Shares, prepare and provide to such Holder such information, including the preparation of

private offering memoranda or circulars or fmancial information, as the Holder may reasonably

request to enable the sale ofthe Preferred Shares pursuant to such exemption, or (z) to the extent

any Holder is relying on Rule 144A under the Securities Act to sell any ofits Preferred Shares,

prepare and provide to such Holder the information required pursuant to Rule 144A(d)(4), and

(2) it will take such further action as any Holder may reasonably request from time to time to

enable such Holder to sell Preferred Shares without registration under the Securities Act within

the limitations of the exemptions provided by (i) the provisions of the Securities Act or any

interpretations thereof or related thereto by the SEC, including transactions based on the so-

-25-
called "Section 4(1y,)" and other similar transactions, (ii) Rule 144 or 144A under the Securities

Act, as such rules may be amended from time to time, or (iii) any similar rule or regulation

hereafter adopted by the SEC; provided that the Company shall not be required to take any action

described in this Section 504(a) that would cause the Company to become subject to the reporting

requirements of Section 13 or 15(d) ofthe Exchange Act ifthe Company was not subject to such

requirements prior to taking such action. Upon the request of any Holder, the Company will

deliver to such Holder a written statement as to whether it has complied with such requirements

and, ifnot, the specifics thereof

(b) The Company 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 ofmaterial fact contained in any document or report provided by the

Company pursuant to this Section 5A or any omission to state therein a material fact required to

be stated therein or necessary to make the statements therein, in light ofthe circumstances under

which they were made, not misleading.

(c) If the indemnification provided for in Section 504(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 Company, in lieu ofindemnifying 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 Company, 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

Company, 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 Company or by the Indemnitee and the

parties' relative intent, knowledge, access to information and opportunity to correct or prevent

such statement or omission; the Company and Investor agree that it would not be just and

equitable if contribution pursuant to this Section 5o4(c) 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 504(b). No Indemnitee guilty of fraudulent misrepresentation (within the

meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from the

Company ifthe Company was not guilty ofsuch fraudulent misrepresentation.

5.5 Depositary Shares. Upon request by the Investor at any time following the

Closing Date, the Company 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 Preferred Shares may be deposited and

depositary shares, each representing a fraction of a Preferred Share, as specified by the Investor,

-26-
may be issued. From and after the execution of any such depositary arrangement, and the deposit

of any Preferred Shares, as applicable, pursuant thereto, the depositary shares issued pursuant

thereto shall be deemed "Preferred Shares" and, as applicable, "Registrable Securities" for

purposes ofthis Agreement.

5.6 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 Company shall, at the Company's sole cost and expense, (i) furnish to

the Investor all instruments, documents and other agreements required to be furnished by the

Company pursuant to the terms ofthis Agreement, including, without limitation, any documents

required to be delivered pursuant to Section 5.4 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 Preferred Shares 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 ofthe

intents and purposes of this Agreement, as the Investor shall reasonably require from time to

time.

ARTICLE VI

MISCELLANEOUS

6.1 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 the Company 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 ofthis Agreement,

it being understood that the parties shall be required to consult only until the fifth

calendar day after 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 6.I(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 ofthe Closing to occur on

or prior to such date; or

(ii) by either the Investor or the Company 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

-27-
by this Agreement, and such order, decree, ruling or other action shall have become

final and nonappealable; or

(iii) by the mutual written consent ofthe Investor and the Company; or

(b) the date on which all of the Preferred Shares have been redeemed in

whole; or

(c) the date on which the Investor has transferred all ofthe Preferred Shares to

third parties which are not Affiliates ofthe Investor; or

(d) if the Closing shall not have occurred by September 30, 2010, on such

date.

In the event oftermination ofthis Agreement as provided in this Section 6.1, this

Agreement shall forthwith become void and there shall be no liability on the part of either party

hereto except that nothing herein shall relieve either party from liability for any breach of this

Agreement.

6.2 Survival.

(a) This Agreement and all representations, warranties, covenants and

agreements made herein shall survive the Closing without limitation.

(b) The covenants set forth in Article IV and Annex E and the agreements set

forth in Article V shall, to the extent such covenants do not explicitly terminate at such time as

the Investor no longer owns any Preferred Shares, survive the termination of this Agreement

pursuant to Section 6.I(c) hereof without limitation until the date on which all of the Preferred

Shares have been redeemed in whole.

6.3 Amendment. No amendment of any provision of this Agreement will be

effective unless made in writing and signed by an officer or a duly authorized representative of

each party; provided that for so long as the Preferred Shares are outstanding, the Investor may at

any time and from time to time unilaterally amend Section 4.1(d) 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 goveming CDFIs, including, without

limitation, any changes in the criteria for certification as a CDFI by the Fund. No failure or

delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver

thereof nor shall any single or partial exercise thereof preclude any other or further exercise of

any other right, power or privilege. The rights and remedies herein provided shall be cumulative

of any rights or remedies provided by law.

6.4 Waiver of Conditions. The conditions to each party's obligation to

consummate the Purchase are for the sole benefit ofsuch 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

-28-
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.

6.5 Governing Law; 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 of the 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 ofNew York applicable to contracts made and

to be performed entirely within such State. Each ofthe parties hereto agrees (a) to submit to the

exclusive jurisdiction and venue ofthe 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 Agreement or the Purchase contemplated hereby and (b) that

notice may be served upon (i) the Company at the address and in the manner set forth for notices

to the Company in Section 6.6 and (ii) the Investor at the address and in the manner set forth for

notices to the Company in Section 6.6, but otherwise in accordance with federal law. TO THE

EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HERETO

HEREBY UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY CIVIL LEGAL

ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR THE PURCHASE

CONTEMPLATED HEREBY.

6.6 Notices. Any notice, request, instruction or other document to be given

hereunder by any party to the other will be in writing and will be deemed to have been 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 Company shall be delivered as set forth in

Schedule A, or pursuant to such other instruction as may be designated in writing by the

Company to the Investor. 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

Company.

Ifto the Investor:

United States Department ofthe Treasury

1500 Pennsylvania Avenue, NW

Washington, D.C. 20220

Attention: ChiefCounsel, Office ofFinancial Stability

Facsimile: (202) 927-9225

E-mail: CDCINotice@do.treas.gov

with a copy to:

E-mail: OFSChiefCounseINotices@do.treas.gov

6.7 Assignment. Neither this Agreement nor any right, remedy, obligation nor

liability arising hereunder or by reason hereofshall be assignable by any party hereto without the

-29-
prior written consent ofthe other party, and any attempt to assign any right, remedy, obligation

or liability hereunder without such consent shall be void, except (a) an assignment, in the case of

a merger, consolidation, statutory share exchange or similar transaction that requires the approval

ofthe Company's stockholders (a "Business Combination") where such party is not the surviving

entity, or a sale of substantially all of its assets, 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 Sections 4.l(c) or 4.l(j) or Annex E or (c) an assignment by the Investor of this

Agreement to an Affiliate ofthe Investor; provided that ifthe 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 enforceable by

such Affiliate, (ii) the Company'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.

6.8 Severability. If any provision of this Agreement, or the application

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 application of such

provision to persons or circumstances other than those as to which it has been held invalid or

unenforceable, will remain in full force and effect and shall in no way be affected, impaired or

invalidated thereby, so long as the economic or legal substance ofthe transactions contemplated

hereby is not affected in any manner materially adverse 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 ofthe parties.

6.9 No Third Party Beneficiaries. Other than as expressly provided herein,

nothing contained in this Agreement, expressed or implied, is intended to confer upon any person

or entity other than the Company and the Investor (and any Indemnitee) any benefit, right or

remedies.

6.10 Specific Performance. The parties agree that irreparable damage would

occur in the event that any ofthe provisions ofthis Agreement were not performed in accordance

with their specific terms. It is accordingly agreed that the parties shall be entitled (without the

necessity of posting a bond) to specific performance ofthe terms hereof, this being in addition to

any other remedies to which they are entitled at law or equity.

* * *

-30-
ANNEXA

FORM OF OFFICER'S CERTIFICATE

OFFICER'S CERTIFICATE

OF

[COMPANYI

In connection with that certain letter agreement, dated [ J, 20 I 0

(the "Agreement") by and between [COMPANY] (the "Company") 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:

I. I am a duly elected/appointed L[ -'1 ofthe Company.

2. The representations and warranties ofthe Company set forth in Section 3.1

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 ofsuch other date) and

the Company has performed in all material respects all obligations required to be performed by it

under the Agreement.

3. The Certificate of Designations, a true, complete and correct copy of

which is attached as Exhibit A hereto, has been filed with, and accepted by, the Secretary of

State ofthe State of[ I.

4. The Company has effected such changes to its Benefit Plans with respect

to its Senior Executive Officers and any other employee ofthe Company or its Affiliates subject

to Section 111 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 III of EESA or the Compensation

Regulations.

The foregoing certifications are made and delivered as of L[ -'1 pursuant

to Section 2.3 ofthe Standard Terms.

A-I
Capitalized terms used and not otherwise defined herein shall have the meanings

assigned to them in the Standard Terms.

[SIGNATURE PAGE FOLLOWS]

A-2
IN WITNESS WHEREOF, this Officer's Certificate has been duly executed and

delivered as ofthe U day of [ ], 20U.

[COMPANY]

By: _

Name:

Title:

A-3
EXHIBIT A

Exh. A-I
ANNEXB

FORM OF CERTIFICATE OF DESIGNATIONS FOR PREFERRED STOCK

[SEE ATTACHED]

B-1
(CDFI Bank/Thrifts 

Senior Preferred Stock) 

 

FORM OF [CERTIFICATE OF DESIGNATIONS] 

OF 

FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK, SERIES [●] 

OF 

[●]

1

[Insert name of Issuer], a [corporation/bank/banking association] organized and 

existing under the laws of the [Insert jurisdiction of organization] (the “Issuer”), in accordance 

with the provisions of Section[s] [●] of the [Insert applicable statute] thereof, does hereby 

certify: 

The board of directors of the Issuer (the “Board of Directors”) or an applicable 

committee of the Board of Directors, in accordance with the [[certificate of incorporation/articles 

of association] and bylaws] of the Issuer and applicable law, adopted the following resolution on 

[●] creating a series of [●] shares of Preferred Stock of the Issuer designated as “Fixed Rate 

Cumulative Perpetual Preferred Stock, Series [●]”. 

RESOLVED, that pursuant to the provisions of the [[certificate of 

incorporation/articles of association] and the bylaws] of the Issuer and applicable law, a series of 

Preferred Stock, par value $[●] per share, of the Issuer be and hereby is created, and that the 

designation and number of shares of such series, and the voting and other powers, preferences 

and relative, participating, optional or other rights, and the qualifications, limitations and 

restrictions thereof, of the shares of such series, are as follows: 

Part 1. Designation and Number of Shares. There is hereby created out of the 

authorized and unissued shares of preferred stock of the Issuer a series of preferred stock 

designated as the “Fixed Rate Cumulative Perpetual Preferred Stock, Series [●]” (the 

“Designated Preferred Stock”). The authorized number of shares of Designated Preferred Stock 

shall be [●]. 

Part 2. Standard Provisions. The Standard Provisions contained in Schedule A

attached hereto are incorporated herein by reference in their entirety and shall be deemed to be a 

part of this [Certificate of Designations] to the same extent as if such provisions had been set 

forth in full herein. 

Part 3. Definitions. The following terms are used in this [Certificate of 

Designations] (including the Standard Provisions in Schedule A hereto) as defined below: 

(a) “Common Stock” means the common stock, par value $[●] per share, of 

the Issuer. 

(b) “Dividend Payment Date” means February 15, May 15, August 15 and 

November 15 of each year. 

 

1

 For entities that are Bank Holding Companies or Savings and Loan Holding Companies. 
 -2- 

(c) “Junior Stock” means the Common Stock, [Insert titles of any existing 

Junior Stock] and any other class or series of stock of the Issuer the terms of which expressly 

provide that it ranks junior to Designated Preferred Stock as to dividend rights and/or as to rights 

on liquidation, dissolution or winding up of the Issuer. 

(d) “Liquidation Amount” means $[1,000]

2

 per share of Designated Preferred 

Stock. 

(e) “Minimum Amount” means $[Insert $ amount equal to 25% of the 

aggregate value of the Designated Preferred Stock issued on the Original Issue Date]. 

(f) “Parity Stock” means any class or series of stock of the Issuer (other than 

Designated Preferred Stock) the terms of which do not expressly provide that such class or series 

will rank senior or junior to Designated Preferred Stock as to dividend rights and/or as to rights 

on liquidation, dissolution or winding up of the Issuer (in each case without regard to whether 

dividends accrue cumulatively or non-cumulatively). Without limiting the foregoing, Parity 

Stock shall include the Issuer’s [Insert title(s) of existing classes or series of Parity Stock]. 

(g) “Signing Date” means [Insert date of applicable securities purchase 

agreement]. 

Part 4. Certain Voting Matters. [To be inserted if the Charter provides for 

voting in proportion to liquidation preferences: Whether the vote or consent of the holders of a 

plurality, majority or other portion of the shares of Designated Preferred Stock and any Voting 

Parity Stock has been cast or given on any matter on which the holders of shares of Designated 

Preferred Stock are entitled to vote shall be determined by the Issuer by reference to the specified 

liquidation amount of the shares voted or covered by the consent as if the Issuer were liquidated 

on the record date for such vote or consent, if any, or, in the absence of a record date, on the date 

for such vote or consent. For purposes of determining the voting rights of the holders of 

Designated Preferred Stock under Section 7 of the Standard Provisions forming part of this 

[Certificate of Designations], each holder will be entitled to one vote for each $1,000 of 

liquidation preference to which such holder’s shares are entitled.] [To be inserted if the Charter 

does not provide for voting in proportion to liquidation preferences: Holders of shares of 

Designated Preferred Stock will be entitled to one vote for each such share on any matter on 

which holders of Designated Preferred Stock are entitled to vote, including any action by written 

consent.]

[Remainder of Page Intentionally Left Blank] 

 

2

 If Issuer desires to issue shares with a higher dollar amount liquidation preference, liquidation 

preference references will be modified accordingly. In such case (in accordance with Section 5.5 of the 

Securities Purchase Agreement), the issuer will be required to enter into a deposit agreement. 
 

IN WITNESS WHEREOF, [Insert name of Issuer] has caused this [Certificate of 

Designations] to be signed by [●], its [●], this [●] day of [●]. 

[Insert name of Issuer] 

By: ____________________________________ 

Name: 

Title: 
 A-1 

Schedule A 

STANDARD PROVISIONS 

Section 1. General Matters. Each share of Designated Preferred Stock shall be 

identical in all respects to every other share of Designated Preferred Stock. The Designated 

Preferred Stock shall be perpetual, subject to the provisions of Section 5 of these Standard 

Provisions that form a part of the Certificate of Designations. The Designated Preferred Stock 

shall rank equally with Parity Stock and shall rank senior to Junior Stock with respect to the 

payment of dividends and the distribution of assets in the event of any dissolution, liquidation or 

winding up of the Issuer. 

Section 2. Standard Definitions. As used herein with respect to Designated 

Preferred Stock: 

(a) “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 of this 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 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. 

(b) “Applicable Dividend Rate” means (i) until the first day of the first 

Dividend Period commencing on or after the eighth anniversary of the Original Issue Date, 2% 

per annum, 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 Applicable 

Dividend Rate shall be 5% 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, 9% per annum] and (ii) for any other 

Dividend Period, 9% per annum. 

(c) “Appropriate Federal Banking Agency” means the “appropriate Federal 

banking agency” with respect to the Issuer as defined in Section 3(q) of the Federal Deposit 

Insurance Act (12 U.S.C. Section 1813(q)), or any successor provision. 

(d) “Business Combination” means a merger, consolidation, statutory share 

exchange or similar transaction that requires the approval of the Issuer’s stockholders. 

(e) “Business Day” means 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. 

(f) “Bylaws” means the bylaws of the Issuer, as they may be amended from 

time to time. 
 A-2 

(g) “CDFI Events” means the failure by each Certified Entity at any time 

while the Designated Preferred Stock is outstanding to (i) be certified by the Community 

Development Financial Institution Fund of the United States Department of 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 from time to time, substantially in 

the manner set forth in 12 C.F.R. 1805.201(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. For the avoidance of doubt, a CDFI Event shall not have occurred so long as at least one 

Certified Entity satisfies the requirements set forth in clauses (i) through (viii) of the preceding 

sentence, even if other Certified Entities fail to satisfy such requirements. 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. 1805.104. A CDFI Event may be waived 

in writing by the holders of a majority of the Designated Preferred Stock then outstanding. 

(h) “Certificate of Designations” means the Certificate of Designations or 

comparable instrument relating to the Designated Preferred Stock, of which these Standard 

Provisions form a part, as it may be amended from time to time. 

(i) “Certified Entity” means the Issuer or, if the Issuer itself has not been 

certified by the Community Development Financial Institution Fund as a regulated community 

development financial institution (“CDFI”), each Affiliate of the Issuer that has been certified by 

the CDFI and is specified on Schedule A of the that certain letter agreement by and between 

Issuer and the United States Department of the Treasury. 

(j) “Charter” means the Issuer’s certificate or articles of incorporation, 

articles of association, or similar organizational document. 

(k) “Dividend Period” has the meaning set forth in Section 3(a). 

(l) “Dividend Record Date” has the meaning set forth in Section 3(a). 

(m) GAAP” means the generally accepted accounting principles in the United 

States. 
 A-3 

(n) “Issuer Subsidiary” means any subsidiary of the Issuer. 

(o) “Liquidation Preference” has the meaning set forth in Section 4(a). 

(p) “Original Issue Date” means the date on which shares of Designated 

Preferred Stock are first issued. 

(q) “Preferred Director” has the meaning set forth in Section 7(b). 

(r) “Preferred Stock” means any and all series of preferred stock of the Issuer, 

including the Designated Preferred Stock. 

(s) [Insert for pro-forma viable companies: “Private Capital” means the 

equity capital received by the [Issuer] [Insert name of Company if Issuer is not the Company] 

from one or more non-governmental investors in accordance with the terms and conditions of 

that certain Securities Purchase Agreement – Standard Terms by and between Issuer and the 

United States Department of the Treasury.] 

(t) “Share Dilution Amount” means the increase in the number of diluted 

shares outstanding (determined in accordance with GAAP, and as measured from the date of the 

Issuer’s most recent consolidated financial statements prior to the Signing Date) resulting from 

the grant, vesting or exercise of equity-based compensation to employees and equitably adjusted 

for any stock split, stock dividend, reverse stock split, reclassification or similar transaction 

[Insert for pro-forma viable companies: or the issuance of Private Capital]. 

(u) “Standard Provisions” mean these Standard Provisions that form a part of 

the Certificate of Designations relating to the Designated Preferred Stock. 

(v) “Voting Parity Stock” means, with regard to any matter as to which the 

holders of Designated Preferred Stock are entitled to vote as specified in Sections 7(a) and 7(b) 

of these Standard Provisions that form a part of the Certificate of Designations, any and all series 

of Parity Stock upon which like voting rights have been conferred and are exercisable with 

respect to such matter. 

Section 3. Dividends. 

(a) Rate. Holders of Designated Preferred Stock shall be entitled to receive, 

on each share of Designated Preferred Stock if, as and when declared by the Board of Directors 

or any duly authorized committee of the Board of Directors, but only out of assets legally 

available therefor, cumulative cash dividends with respect to each Dividend Period (as defined 

below) at a rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount 

per share of Designated Preferred Stock and (ii) the amount of accrued and unpaid dividends for 

any prior Dividend Period on such share of Designated Preferred Stock, if any. Such dividends 

shall begin to accrue and be cumulative from the Original Issue Date, shall compound on each 

subsequent Dividend Payment Date (i.e., no dividends shall accrue on other dividends unless and 

until the first Dividend Payment Date for such other dividends has passed without such other 

dividends having been paid on such date) and shall be payable quarterly in arrears on each 

Dividend Payment Date, commencing with the first such Dividend Payment Date to occur at 
 A-4 

least 20 calendar days after the Original Issue Date. In the event that any Dividend Payment 

Date would otherwise fall on a day that is not a Business Day, the dividend payment due on that 

date will be postponed to the next day that is a Business Day and no additional dividends will 

accrue as a result of that postponement. The period from and including any Dividend Payment 

Date to, but excluding, the next Dividend Payment Date is a “Dividend Period”, provided that 

the initial Dividend Period shall be the period from and including the Original Issue Date to, but 

excluding, the next Dividend Payment Date. 

Dividends that are payable on Designated Preferred Stock in respect of any 

Dividend Period shall be computed on the basis of a 360-day year consisting of twelve 30-day 

months. The amount of dividends payable on Designated Preferred Stock on any date prior to the 

end of a Dividend Period, and for the initial Dividend Period, shall be computed on the basis of a 

360-day year consisting of twelve 30-day months, and actual days elapsed over a 30-day month. 

Dividends that are payable on Designated Preferred Stock on any Dividend 

Payment Date will be payable to holders of record of Designated Preferred Stock as they appear 

on the stock register of the Issuer on the applicable record date, which shall be the 15th calendar 

day immediately preceding such Dividend Payment Date or such other record date fixed by the 

Board of Directors or any duly authorized committee of the Board of Directors that is not more 

than 60 nor less than 10 days prior to such Dividend Payment Date (each, a “Dividend Record 

Date”). Any such day that is a Dividend Record Date shall be a Dividend Record Date whether 

or not such day is a Business Day. 

Holders of Designated Preferred Stock shall not be entitled to any dividends, 

whether payable in cash, securities or other property, other than dividends (if any) declared and 

payable on Designated Preferred Stock as specified in this Section 3 (subject to the other 

provisions of the Certificate of Designations). 

(b) Priority of Dividends. So long as any share of Designated Preferred Stock 

remains outstanding, no dividend or distribution shall be declared or paid on the Common Stock 

or any other shares of Junior Stock (other than dividends payable solely in shares of Common 

Stock) or Parity Stock, subject to Section 3(c) below and the immediately following paragraph in 

the case of Parity Stock, and no Common Stock, Junior Stock or Parity Stock shall be, directly or 

indirectly, purchased, redeemed or otherwise acquired for consideration by the Issuer or any of 

its subsidiaries unless all accrued and unpaid dividends for all past Dividend Periods, including 

the latest completed Dividend Period (including, if applicable as provided in Section 3(a) above, 

dividends on such amount), on all outstanding shares of Designated Preferred Stock have been or 

are contemporaneously declared and paid in full (or have been declared and a sum sufficient for 

the payment thereof has been set aside for the benefit of the holders of shares of Designated 

Preferred Stock on the applicable record date). 

When dividends are not paid (or declared and a sum sufficient for payment 

thereof set aside for the benefit of the holders thereof on the applicable record date) on any 

Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different 

from the Dividend Payment Dates, on a dividend payment date falling within a Dividend Period 

related to such Dividend Payment Date) in full upon Designated Preferred Stock and any shares 

of Parity Stock, all dividends declared on Designated Preferred Stock and all such Parity Stock 
 A-5 

and payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend 

payment dates different from the Dividend Payment Dates, on a dividend payment date falling 

within the Dividend Period related to such Dividend Payment Date) shall be declared pro rata so 

that the respective amounts of such dividends declared shall bear the same ratio to each other as 

all accrued and unpaid dividends per share on the shares of Designated Preferred Stock 

(including, if applicable as provided in Section 3(a) above, dividends on such amount) and all 

Parity Stock payable on such Dividend Payment Date (or, in the case of Parity Stock having 

dividend payment dates different from the Dividend Payment Dates, on a dividend payment date 

falling within the Dividend Period related to such Dividend Payment Date) (subject to their 

having been declared by the Board of Directors or a duly authorized committee of the Board of 

Directors out of legally available funds and including, in the case of Parity Stock that bears 

cumulative dividends, all accrued but unpaid dividends) bear to each other. If the Board of 

Directors or a duly authorized committee of the Board of Directors determines not to pay any 

dividend or a full dividend on a Dividend Payment Date, the Issuer will provide written notice to 

the holders of Designated Preferred Stock prior to such Dividend Payment Date. 

Subject to the foregoing and Section 3(c) below, and not otherwise, such 

dividends (payable in cash, securities or other property) as may be determined by the Board of 

Directors or any duly authorized committee of the Board of Directors may be declared and paid 

on any securities, including Common Stock and other Junior Stock, from time to time out of any 

funds legally available for such payment, and holders of Designated Preferred Stock shall not be 

entitled to participate in any such dividends. 

(c) Restriction on Dividends. So long as any share of Designated Preferred Stock 

remains outstanding, neither the Issuer nor any Issuer Subsidiary shall, declare or pay any 

dividend or make any distribution on Common Stock, Junior Stock, Parity Stock or other capital 

stock or other equity securities of any kind of the Issuer or any Issuer Subsidiary (other than (i) 

regular quarterly cash dividends of not more than the amount of the last quarterly cash dividend 

per share declared or, if lower, announced to its holders of Common Stock an intention to 

declare, on the Common Stock prior to [For Companies with CPP/CDCI Securities 

outstanding, insert the date set forth in the analogous provision of the related Securities 

Purchase Agreement][For Companies without CPP/CDCI Securities outstanding: October 21, 

20093

], as adjusted for any stock split, stock dividend, reverse stock split, reclassification or 

similar transaction, (ii) dividends payable solely in shares of Common Stock, (iii) regular 

dividends on shares of preferred stock in accordance with the terms thereof and which are 

permitted under the terms of this Section 3, (iv) dividends or distributions by any wholly-owned 

Issuer Subsidiary, (v) dividends or distributions by any Issuer Subsidiary required pursuant to 

binding contractual agreements entered into prior to [For Companies with CPP/CDCI Securities 

outstanding, insert the date set forth in the analogous provision of the related Securities 

Purchase Agreement][For Companies without CPP/CDCI Securities outstanding: October 21, 

20094

)] or (vi) in the case of pari passu Preferred Stock, dividends payable on a pro rata basis 

with Designated Preferred Stock), unless all accrued and unpaid dividends for all past Dividend 

Periods, including the latest completed Dividend Period (including, if applicable as provided in 

 

3

 For exchanges of CPP, the date will be the date for the same provision in that SPA. 

4

 For exchanges of CPP, the date will be the date for the same provision in that SPA. 
 A-6 

Section 3(a) above, dividends on such amount), on all outstanding shares of Designated 

Preferred Stock have been or are contemporaneously declared and paid in full (or have been 

declared and a sum sufficient for the payment thereof has been set aside for the benefit of the 

holders of shares of Designated Preferred Stock on the applicable record date). 

So long as any share of Designated Preferred Stock remains outstanding, neither 

the Issuer nor any Issuer Subsidiary shall, (x) pay any per share dividend or distribution on 

Common Stock, Junior Stock, Parity Stock or other capital stock or other equity securities of any 

kind of the Issuer at a rate that is in excess of 100% of the aggregate per share dividends and 

distributions for the immediately prior fiscal year (other than regular dividends on shares of 

preferred stock in accordance with the terms thereof and which are permitted under the terms of 

this Section 3); provided that no increase in the aggregate amount of dividends or distributions 

on Common Stock shall be permitted for any twelve (12) month period, including, without 

limitation, as a result of any dividends or distributions paid in shares of Common Stock, any 

stock split or any similar transaction or (y) pay aggregate dividends or distributions on capital 

stock or other equity securities of any kind of any Issuer Subsidiary that is in excess of 100% of 

the aggregate dividends and distributions paid for the immediately prior fiscal year (other than in 

the case of this clause (y), (1) regular dividends on shares of preferred stock in accordance with 

the terms thereof and which are permitted under the terms of this Section 3, (2) dividends or 

distributions by any wholly-owned Issuer Subsidiary, (3) dividends or distributions by any Issuer 

Subsidiary required pursuant to binding contractual agreements entered into prior to October 21, 

20095

 or (4) dividends or distributions on newly issued shares of capital stock for cash or other 

property). 

Section 4. Liquidation Rights. 

(a) Voluntary or Involuntary Liquidation. In the event of any liquidation, 

dissolution or winding up of the affairs of the Issuer, whether voluntary or involuntary, holders 

of Designated Preferred Stock shall be entitled to receive for each share of Designated Preferred 

Stock, out of the assets of the Issuer or proceeds thereof (whether capital or surplus) available for 

distribution to stockholders of the Issuer, subject to the rights of any creditors of the Issuer, 

before any distribution of such assets or proceeds is made to or set aside for the holders of 

Common Stock and any other stock of the Issuer ranking junior to Designated Preferred Stock as 

to such distribution, payment in full in an amount equal to the sum of (i) the Liquidation Amount 

per share and (ii) the amount of any accrued and unpaid dividends (including, if applicable as 

provided in Section 3(a) above, dividends on such amount), whether or not declared, to the date 

of payment (such amounts collectively, the “Liquidation Preference”). 

(b) Partial Payment. If in any distribution described in Section 4(a) above the 

assets of the Issuer or proceeds thereof are not sufficient to pay in full the amounts payable with 

respect to all outstanding shares of Designated Preferred Stock and the corresponding amounts 

payable with respect of any other stock of the Issuer ranking equally with Designated Preferred 

Stock as to such distribution, holders of Designated Preferred Stock and the holders of such other 

stock shall share ratably in any such distribution in proportion to the full respective distributions 

to which they are entitled. 

 

5

 For exchanges of CPP, the date will be the date for the same provision in that SPA. 
 A-7 

(c) Residual Distributions. If the Liquidation Preference has been paid in full 

to all holders of Designated Preferred Stock and the corresponding amounts payable with respect 

of any other stock of the Issuer ranking equally with Designated Preferred Stock as to such 

distribution has been paid in full, the holders of other stock of the Issuer shall be entitled to 

receive all remaining assets of the Issuer (or proceeds thereof) according to their respective rights 

and preferences. 

(d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes 

of this Section 4, the merger or consolidation of the Issuer with any other corporation or other 

entity, including a merger or consolidation in which the holders of Designated Preferred Stock 

receive cash, securities or other property for their shares, or the sale, lease or exchange (for cash, 

securities or other property) of all or substantially all of the assets of the Issuer, shall not 

constitute a liquidation, dissolution or winding up of the Issuer. 

Section 5. Redemption. 

(a) Optional Redemption. The Issuer, at its option, subject to the approval of 

the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time and from 

time to time, out of funds legally available therefor, the shares of Designated Preferred Stock at 

the time outstanding, upon notice given as provided in Section 5(c) below, at a redemption price 

equal to the sum of (i) the Liquidation Amount per share and (ii) any accrued and unpaid 

dividends (including, if applicable as provided in Section 3(a) above, dividends on such amount) 

(regardless of whether any dividends are actually declared) to, but excluding, the date fixed for 

redemption. 

The redemption price for any shares of Designated Preferred Stock shall be 

payable on the redemption date to the holder of such shares against surrender of the certificate(s) 

evidencing such shares to the Issuer or its agent. Any declared but unpaid dividends payable on a 

redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall 

not be paid to the holder entitled to receive the redemption price on the redemption date, but 

rather shall be paid to the holder of record of the redeemed shares on such Dividend Record Date 

relating to the Dividend Payment Date as provided in Section 3 above. 

(b) No Sinking Fund. The Designated Preferred Stock will not be subject to 

any mandatory redemption, sinking fund or other similar provisions. Holders of Designated 

Preferred Stock will have no right to require redemption or repurchase of any shares of 

Designated Preferred Stock. 

(c) Notice of Redemption. Notice of every redemption of shares of 

Designated Preferred Stock shall be given by first class mail, postage prepaid, addressed to the 

holders of record of the shares to be redeemed at their respective last addresses appearing on the 

books of the Issuer. Such mailing shall be at least 30 days and not more than 60 days before the 

date fixed for redemption. 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 shares of Designated Preferred Stock designated for redemption shall not affect the 

validity of the proceedings for the redemption of any other shares of Designated Preferred Stock. 
 A-8 

Notwithstanding the foregoing, if shares of Designated Preferred Stock are 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 Designated Preferred Stock at such time and in any manner 

permitted by such facility. Each notice of redemption given to a holder shall state: (1) the 

redemption date; (2) the number of shares of Designated Preferred Stock to be redeemed and, if 

less than all the shares held by such holder are to be redeemed, the number of such shares to be 

redeemed from such holder; (3) the redemption price; and (4) the place or places where 

certificates for such shares are to be surrendered for payment of the redemption price. 

(d) Partial Redemption. In case of any redemption of part of the shares of 

Designated Preferred Stock at the time outstanding, the shares to be redeemed shall be selected 

either pro rata or in such other manner as the Board of Directors or a duly authorized committee 

thereof may determine to be fair and equitable. 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 shares of Designated Preferred Stock shall be redeemed 

from time to time. If fewer than all the shares represented by any certificate are redeemed, a new 

certificate shall be issued representing the unredeemed shares without charge to the holder 

thereof. 

(e) 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 Issuer, in trust for the pro rata benefit of the holders of 

the shares 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 certificate for any share so called for redemption has not been 

surrendered for cancellation, on and after the redemption date dividends shall cease to accrue on 

all shares so called for redemption, all shares so called for redemption shall no longer be deemed 

outstanding and all rights with respect to such shares shall forthwith on such redemption date 

cease and terminate, except only the right of the holders thereof to receive the amount payable on 

such redemption from such bank or trust company, without interest. Any funds unclaimed at the 

end of three years from the redemption date shall, to the extent permitted by law, be released to 

the Issuer, after which time the holders of the shares so called for redemption shall look only to 

the Issuer for payment of the redemption price of such shares. 

(f) Status of Redeemed Shares. Shares of Designated Preferred Stock that are 

redeemed, repurchased or otherwise acquired by the Issuer shall revert to authorized but unissued 

shares of Preferred Stock (provided that any such cancelled shares of Designated Preferred Stock 

may be reissued only as shares of any series of Preferred Stock other than Designated Preferred 

Stock). 

Section 6. Conversion. Holders of Designated Preferred Stock shares shall have 

no right to exchange or convert such shares into any other securities. 
 A-9 

Section 7. Voting Rights. 

(a) General. The holders of Designated Preferred Stock shall not have any 

voting rights except as set forth below or as otherwise from time to time required by law. 

(b) Preferred Stock Directors. Whenever, at any time or times, dividends 

payable on the shares of Designated Preferred Stock have not been paid for an aggregate of eight 

quarterly Dividend Periods or more, whether or not consecutive, the authorized number of 

directors of the Issuer shall automatically be increased by two and the holders of the Designated 

Preferred Stock shall have the right, with holders of shares of any one or more other classes or 

series of Voting Parity Stock outstanding at the time, voting together as a class, to elect two 

directors (hereinafter the “Preferred Directors” and each a “Preferred Director”) to fill such 

newly created directorships at the Issuer’s next annual meeting of stockholders (or at a special 

meeting called for that purpose prior to such next annual meeting) and at each subsequent annual 

meeting of stockholders until dividends payable on all outstanding shares of Designated 

Preferred Stock have been declared and paid in full for four consecutive quarterly Dividend 

Period (and which shall include all accrued and unpaid dividends for all past Dividend Periods, 

including the latest completed Dividend Period (including, if applicable as provided in Section 

3(a) above, dividends on such amount)), at which time such right shall terminate with respect to 

the Designated Preferred Stock, except as herein or by law expressly provided, subject to 

revesting in the event of each and every subsequent default of the character above mentioned; 

provided that it shall be a qualification for election for any Preferred Director that the election of 

such Preferred Director shall not cause the Issuer to violate any corporate governance 

requirements of any securities exchange or other trading facility on which securities of the Issuer 

may then be listed or traded that listed or traded companies must have a majority of independent 

directors. Upon any termination of the right of the holders of shares of Designated Preferred 

Stock and Voting Parity Stock as a class to vote for directors as provided above, the Preferred 

Directors shall cease to be qualified as directors, the term of office of all Preferred Directors then 

in office shall terminate immediately and the authorized number of directors shall be reduced by 

the number of Preferred Directors elected pursuant hereto. Any Preferred Director may be 

removed at any time, with or without cause, and any vacancy created thereby may be filled, only 

by the affirmative vote of the holders a majority of the shares of Designated Preferred Stock at 

the time outstanding voting separately as a class together with the holders of shares of Voting 

Parity Stock, to the extent the voting rights of such holders described above are then exercisable. 

If the office of any Preferred Director becomes vacant for any reason other than removal from 

office as aforesaid, the remaining Preferred Director may choose a successor who shall hold 

office for the unexpired term in respect of which such vacancy occurred. 

(c) Class Voting Rights as to Particular Matters. So long as any shares of 

Designated Preferred Stock are outstanding, in addition to any other vote or consent of 

stockholders required by law or by the Charter, the vote or consent of the holders of at least 66 

2/3% of the shares of Designated Preferred Stock at the time outstanding, voting as a separate 

class, given in person or by proxy, either in writing without a meeting or by vote at any meeting 

called for the purpose, shall be necessary for effecting or validating: 

(i) Authorization of Senior Stock. Any amendment or alteration of the 

Certificate of Designations for the Designated Preferred Stock or the Charter to authorize 
 A-10 

or create or increase the authorized amount of, or any issuance of, any shares of, or any 

securities convertible into or exchangeable or exercisable for shares of, any class or series 

of capital stock of the Issuer ranking senior to Designated Preferred Stock with respect to 

either or both the payment of dividends and/or the distribution of assets on any 

liquidation, dissolution or winding up of the Issuer; 

(ii) Amendment of Designated Preferred Stock. Any amendment, alteration 

or repeal of any provision of the Certificate of Designations for the Designated Preferred 

Stock or the Charter (including, unless no vote on such merger or consolidation is 

required by Section 7(c)(iii) 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 of the Designated Preferred Stock; or 

(iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any 

consummation of a binding share exchange or reclassification involving the Designated 

Preferred Stock, or of a merger or consolidation of the Issuer with another corporation or 

other entity, unless in each case (x) the shares of Designated Preferred Stock remain 

outstanding or, in the case of any such merger or consolidation with respect to which the 

Issuer is not the surviving or resulting entity, are converted into or exchanged for 

preference securities of the surviving or resulting entity or its ultimate parent, and 

(y) such shares remaining outstanding or such preference 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 Designated Preferred Stock immediately prior to such 

consummation, taken as a whole; 

provided, however, that for all purposes of this Section 7(c), any increase in the amount of the 

authorized Preferred Stock, including any increase in the authorized amount of Designated 

Preferred Stock necessary to satisfy preemptive or similar rights granted by the Issuer to other 

persons prior to the Signing Date, or the creation and issuance, or an increase in the authorized or 

issued amount, whether pursuant to preemptive or similar rights or otherwise, of any other series 

of Preferred Stock, or any securities convertible into or exchangeable or exercisable for any other 

series of Preferred Stock, ranking equally with and/or junior to Designated Preferred Stock with 

respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) 

and the distribution of assets upon liquidation, dissolution or winding up of the Issuer 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 shares of the Designated 

Preferred Stock. 

(d) Changes after Provision for Redemption. No vote or consent of the holders 

of Designated Preferred Stock shall be required pursuant to Section 7(c) above if, at or prior to 

the time when any such vote or consent would otherwise be required pursuant to such Section, 

all outstanding shares of the Designated Preferred Stock 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 5 above. 
 A-11 

(e) Procedures for Voting and Consents. The rules and procedures for calling 

and conducting any meeting of the holders of Designated Preferred Stock (including, without 

limitation, the fixing of a record date in connection therewith), the solicitation and use 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 procedures shall conform to the requirements of the Charter, the Bylaws, 

and applicable law and the rules of any national securities exchange or other trading facility on 

which Designated Preferred Stock is listed or traded at the time. 

Section 8. Restriction on Repurchases. So long as any share of Designated 

Preferred Stock remains outstanding, neither the Issuer nor any Issuer Subsidiary shall, redeem, 

purchase or acquire any shares of Common Stock, Junior Stock, Parity Stock or other capital 

stock or other equity securities of any kind of the Issuer or any Issuer Subsidiary, or any trust 

preferred securities issued by the Issuer or any Affiliate of the Issuer, (other than (i) redemptions, 

purchases, repurchases or other acquisitions of the Designated Preferred Stock and (ii) 

repurchases of Junior Stock or Common Stock in connection with the administration of any 

employee benefit plan in the ordinary course of business (including purchases to offset any Share 

Dilution Amount pursuant to a publicly announced repurchase plan) and consistent with past 

practice; provided that any purchases to offset the Share Dilution Amount shall in no event 

exceed the Share Dilution Amount, (iii) the acquisition by the Issuer or any of the Issuer 

Subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership of 

any other persons (other than the Issuer or any other Issuer Subsidiary), including as trustees or 

custodians, (iv) the exchange or conversion of Junior Stock for or into other Junior Stock or of 

Parity Stock or trust preferred securities for or into other Parity Stock (with the same or lesser 

aggregate liquidation amount) or Junior Stock, in each case set forth in this clause (iv), solely to 

the extent required pursuant to binding contractual agreements entered into prior to the Signing 

Date or any subsequent agreement for the accelerated exercise, settlement or exchange thereof 

for Common Stock, (v) redemptions of securities held by the Issuer or any wholly-owned Issuer 

Subsidiary or (vi) redemptions, purchases or other acquisitions of capital stock or other equity 

securities of any kind of any Issuer Subsidiary required pursuant to binding contractual 

agreements entered into prior to October 21, 20096

), unless all accrued and unpaid dividends for 

all past Dividend Periods, including the latest completed Dividend Period (including, if 

applicable as provided in Section 3(a) above, dividends on such amount), on all outstanding 

shares of Designated Preferred Stock have been or are contemporaneously declared and paid in 

full (or have been declared and a sum sufficient for the payment thereof has been set aside for the 

benefit of the holders of shares of Designated Preferred Stock on the applicable record date). 

Section 9. Record Holders. To the fullest extent permitted by applicable law, the 

Issuer and the transfer agent for Designated Preferred Stock may deem and treat the record 

holder of any share of Designated Preferred Stock as the true and lawful owner thereof for all 

purposes, and neither the Issuer nor such transfer agent shall be affected by any notice to the 

contrary. 

 

6

 For exchanges of CPP, the date will be the date for the same provision in that SPA. 
 A-12 

Section 10. Notices. All notices or communications in respect of Designated 

Preferred Stock shall be sufficiently given if given in writing and delivered in person or by first 

class mail, postage prepaid, or if given in such other manner as may be permitted in this 

Certificate of Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the 

foregoing, if shares of Designated Preferred Stock are issued in book-entry form through The 

Depository Trust Company or any similar facility, such notices may be given to the holders of 

Designated Preferred Stock in any manner permitted by such facility. 

Section 11. No Preemptive Rights. No share of Designated Preferred Stock shall 

have any rights of preemption whatsoever as to any securities of the Issuer, or any warrants, 

rights or options issued or granted with respect thereto, regardless of how such securities, or such 

warrants, rights or options, may be designated, issued or granted. 

Section 12. Replacement Certificates. The Issuer shall replace any mutilated 

certificate at the holder’s expense upon surrender of that certificate to the Issuer. The Issuer shall 

replace certificates that become destroyed, stolen or lost at the holder’s expense upon delivery to 

the Issuer of reasonably satisfactory evidence that the certificate has been destroyed, stolen or 

lost, together with any indemnity that may be reasonably required by the Issuer. 

Section 13. Other Rights. The shares of Designated Preferred Stock shall not 

have any rights, preferences, privileges or voting powers or relative, participating, optional or 

other special rights, or qualifications, limitations or restrictions thereof, other than as set forth 

herein or in the Charter or as provided by applicable law. 
ANNEXC

FORM OF WAIVER

In consideration for the benefits I will receive as a result of the participation of

Liberty Financial Services, Inc. (together with its subsidiaries and affiliates, the "Company'') in

the United States Department of the Treasury's ("Treasury") Community Development Capital

Initiative and/or any other economic stabilization program implemented by Treasury under the

Emergency Economic Stabilization Act of 2008 (as amended, supplemented or otherwise

modified, "EESA") (any such initiative or program, including the Community Development

Capital Initiative, a "Program"), I hereby voluntarily waive any claim against the United States

(and each of its departments and agencies) or the Company or any of its directors, officers,

employees and agents for any changes to my compensation or benefits that are required to

comply with the executive compensation and corporate governance requirements of Section III

of EESA, as implemented by any guidance or regulation thereunder, including the rules set forth

in 31 C.F.R. Part 30, or any other guidance or regulations under EESA, and the applicable

requirements of the Securities Purchase Agreement by and between the Company and Treasury

dated as of , 20I0, as amended (such requirements, the "Limitations").

I acknowledge that the Limitations may require modification or termination ofthe

employment, compensation, bonus, incentive, severance, retention and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute" agreements),

whether or not in writing, that I may have with the Company or in which I may participate as

they relate to the period the United States holds any equity or debt securities of the Company

acquired through a Program or for any other period applicable under such Program or

Limitations, as the case may be, and I hereby consent to all such modifications.

This waiver includes all claims I may have under the laws of the United States or

any other jurisdiction (whether or not in existence as of the date hereof) related to the

requirements imposed by the Limitations, including without limitation a claim for any

compensation or other payments or benefits I would otherwise receive, any challenge to the

process by which the Limitations are or were adopted and any tort or constitutional claim about

the effect of the Limitations on my employment relationship and I hereby agree that I will not at

any time initiate, or cause or permit to be initiated on my behalf, any such claim against the

United States (or any of its departments or agencies) or the Company or any of its directors,

officers, employees or agents in or before any local, state, federal or other agency, court or body.

I agree that, in the event and to the extent that the Compensation Committee of

the Board of Directors ofthe Company or similar goveming body (the "Committee") reasonably

determines that any compensatory payment or benefit provided to me, including any bonus or

incentive compensation based on materially inaccurate financial statements or performance

criteria, would cause the Company to fail to be in compliance with the Limitations (such

payment or benefit, an "Excess Payment"), upon notification from the Company, I shall repay

such Excess Payment to the Company within 15 business days. In addition, I agree that the

C-1
Company shall have the right to postpone any such payment or benefit for a reasonable period of

time to enable the Committee to determine whether such payment or benefit would constitute an

Excess Payment.

I 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 Company to be in compliance with Section 111 of EESA and/or the Limitations

shall be a final and conclusive determination ofthe Committee which shall be binding upon me.

I further understand that the Company is relying on this letter from me in connection with its

participation in a Program.

In witness whereof, I execute this waiver on my own behalf, thereby

communicating my acceptance and acknowledgement to the provisions herein.

Respectfully,

By::-:- _

Name:

Title:

Date:

C-2
ANNEXD

FORM OF OPINION

(a) The Company has been duly formed and is validly existing as a [TYPE

OF ORGANIZATION] and is in good standing under the laws of the jurisdiction of its

organization. The Company has all necessary power and authority to own, operate and lease its

properties and to carry on its business as it is being conducted.

entity for the

],

(b) The Company has been duly qualified as a foreign

transaction of business and is in good standing under the laws of L[ -'

[ ] and [..... -'1.

(c) The Preferred Shares have been duly and validly authorized, and, when

issued and delivered pursuant to the Agreement, the Preferred Shares will be duly and validly

issued and fully paid and non-assessable, will not be issued in violation of any preemptive rights,

and will rank pari passu with or senior to all other series or classes of Preferred Stock issued on

the Closing Date with respect to the payment of dividends and the distribution of assets in the

event of any dissolution, liquidation or winding up ofthe Company.

(d) The Company has the corporate power and authority to execute and

deliver the Agreement and to carry out its obligations thereunder (which includes the issuance of

the Preferred Shares).

(e) The execution, delivery and performance by the Company of the

Agreement and the consummation of the transactions contemplated thereby have been duly

authorized by all necessary corporate action on the part ofthe Company and its stockholders, and

no further approval or authorization is required on the part of the Company, including, without

limitation, by any rule or requirement of any national stock exchange.

(f) The Agreement is a valid and binding obligation of the Company

enforceable against the Company 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 ofwhether such enforceability is considered in a proceeding at law or in equity.

(g) The execution and delivery by the Company of this Agreement and the

performance by the Company ofits obligations thereunder (i) do not require any approval by any

Governmental Entity to be obtained on the part of the Company, except those that have been

obtained, (ii) do not violate or conflict with any provision of the 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 ofthe

properties or assets of the Company or any Company Subsidiary under any of the terms,

conditions or provisions of its organizational documents or under any agreement, contract,

D-I
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 Company and, pursuant to any applicable laws, is issued by any

Governmental Entity having jurisdiction over the Company.

(h) Other than the filing of the Certificate of Designations with the Secretary

of State of its jurisdiction of organization or other applicable Governmental Entity, such filings

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

consents and approvals that 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 Company in connection with the consummation by the Company ofthe

Purchase.

(i) The Company is not nor, after giving effect to the issuance of the

Preferred Shares pursuant to the Agreement, would be on the date hereof an "investment

company" or an entity "controlled" by an "investment company," as such terms are defined in

the Investment Company Act of 1940, as amended.

(j) Each Certified Entity (A) 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) and (B) satisfies all of the eligibility requirements of the Fund's Community

Development Financial Institutions Program for a CDFI.

D-2
ANNEXE

REGISTRATION RIGHTS

1.1 Definitions. Terms not defined in this Annex shall have the meaning

ascribed to such terms in the Agreement. As used in this Annex E, the following terms shall have

the following respective meanings:

(a) "Holder" means the Investor and any other holder of Registrable

Securities to whom the registration rights conferred by this Agreement have been transferred in

compliance with Section 1.9 hereof.

(b) "Holders' Counsel" means one counsel for the selling Holders chosen by

Holders holding a majority interest in the Registrable Securities being registered.

(c) "Pending Underwritten Offering" means, with respect to any Holder

forfeiting its rights pursuant to Section 1.11 of this Annex E, any underwritten offering of

Registrable Securities in which such Holder has advised the Company of its intent to register its

Registrable Securities either pursuant to Section 1.2(b) or Section 1.2(d) ofthis Annex E prior to

the date of such Holder's forfeiture.

(d) "Register", "registered", and "registration" shall refer to a registration

effected by preparing and (A) filing a registration statement or amendment thereto in compliance

with the Securities Act and applicable rules and regulations thereunder, and the declaration or

ordering of effectiveness of such registration statement or amendment thereto or (B) filing a

prospectus and/or prospectus supplement in respect of an appropriate effective registration

statement on Form S-3.

(e) "Registrable Securities" means (A) all Preferred Shares and (B) any equity

securities issued or issuable directly or indirectly with respect to the securities referred to in the

foregoing clause (A) by way of conversion, exercise or exchange thereof, or share dividend or

share split or in connection with a combination of shares, recapitalization, reclassification,

merger, amalgamation, arrangement, consolidation or other reorganization, provided that, once

issued, such securities will not be Registrable Securities when (I) they are sold pursuant to an

effective registration statement under the Securities Act, (2) they shall have ceased to be

outstanding or (3) they have been sold in any transaction in which the transferor's rights under

this Agreement are not assigned to the transferee of the securities. No Registrable Securities

may be registered under more than one registration statement at anyone time.

(f) "Registration Expenses" mean all expenses incurred by the Company in

effecting any registration pursuant to this Agreement (whether or not any registration or

prospectus becomes effective or final) or otherwise complying with its obligations under this

Annex E, including all registration, filing and listing fees, printing expenses, fees and

disbursements of counsel for the Company, blue sky fees and expenses, expenses incurred in

connection with any "road show", the reasonable fees and disbursements of Holders' Counsel,

and expenses of the Company's independent accountants in connection with any regular or

E-I
special reviews or audits incident to or required by any such registration, but shall not include

Selling Expenses.

(g) "Rule 144", "Rule 144A", "Rule 159A", "Rule 405" and "Rule 415" mean,

in each case, such rule promulgated under the Securities Act (or any successor provision), as the

same shall be amended from time to time.

(h) "Selling Expenses" mean all discounts, selling commissions and stock

transfer taxes applicable to the sale of Registrable Securities and fees and disbursements of

counsel for any Holder (other than the fees and disbursements of Holders' Counsel included in

Registration Expenses).

(i) "Special Registration" means the registration of (A) equity securities

and/or options or other rights in respect thereof solely registered on Form S-4 or Form S-8.(or

successor form) or (B) shares of equity securities and/or options or other rights in respect thereof

to be offered to directors, members of management, employees, consultants, customers, lenders

or vendors of the Company or Company Subsidiaries or in connection with dividend

reinvestment plans.

1.2 Registration.

(a) The Company covenants and agrees that as promptly as practicable after

the date that the Company becomes subject to the reporting requirements of Section 13 or 15(d)

of the Exchange Act (and in any event no later than 30 days thereafter), the Company shall

prepare and file with the SEC a ShelfRegistration Statement covering all Registrable Securities

(or otherwise designate an existing shelf registration on an appropriate form under Rule 415

under the Securities Act (a "Shelf Registration Statement'') filed with the SEC to cover the

Registrable Securities), and, to the extent the Shelf Registration Statement has not theretofore

been declared effective or is not automatically effective upon such filing, the Company shall use

reasonable best efforts to cause such Shelf Registration Statement to be declared or become

effective and to keep such ShelfRegistration Statement continuously effective and in compliance

with the Securities Act and usable for resale ofsuch Registrable Securities for a period from the

date of its initial effectiveness until such time as there are no Registrable Securities remaining

(including by refiling such ShelfRegistration Statement (or a new Shelf Registration Statement)

if the initial Shelf Registration Statement expires). Notwithstanding the foregoing, if the

Company is not eligible to file a registration statement on Form S-3, then the Company shall not

be obligated to file a Shelf Registration Statement unless and until requested to do so in writing

by the Investor.

(b) Any registration pursuant to Section 1.2(a) of this Annex E shall be

effected by means of a Shelf Registration Statement on an appropriate form under Rule 415

under the Securities Act (a "ShelfRegistration Statement"). If the Investor or any other Holder

intends to distribute any Registrable Securities by means of an underwritten offering it shall

promptly so advise the Company and the Company shall take all reasonable steps to facilitate

such distribution, including the actions required pursuant to Section 1.2(d) of this Annex E;

provided that the Company shall not be required to facilitate an underwritten offering of

Registrable Securities unless (i) the expected gross proceeds from such offering exceed $200,000

E-2
or (ii) such underwritten offering includes all of the outstanding Registrable Securities held by

such Holder. The lead underwriters in any such distribution shall be selected by the Holders of

a majority ofthe Registrable Securities to be distributed.

(c) The Company shall not be required to effect a registration (including a

resale of Registrable Securities from an effective Shelf Registration Statement) or an

underwritten offering pursuant to Section 1.2 ofthis Annex E: (A) with respect to securities that

are not Registrable Securities; or (B) if the Company has notified the Investor and all other

Holders that in the good faith judgment of the Board of Directors, it would be materially

detrimental to the Company or its securityholders for such registration or underwritten offering

to be effected at such time, in which event the Company shall have the right to defer such

registration for a period of not more than 45 days after receipt of the request of the Investor or

any other Holder; provided that such right to delay a registration or underwritten offering shall

be exercised by the Company (1) only ifthe Company has generally exercised (or is concurrently

exercising) similar black-out rights against holders of similar securities that have registration

rights and (2) not more than three times in any l2-month period and not more than 90 days in the

aggregate in any l2-month period.

(d) If during any period when an effective ShelfRegistration Statement is not

available, the Company proposes to register any ofits equity securities, other than a registration

pursuant to Section 1.2(a) ofthis Annex E or a Special Registration, and the registration form to

be filed may be used for the registration or qualification for distribution ofRegistrable Securities,

the Company will give prompt written notice to the Investor and all other Holders ofits intention

to effect such a registration (but in no event less than ten days prior to the anticipated filing date)

and will include in such registration all Registrable Securities with respect to which the

Company has received written requests for inclusion therein within ten business days after the

date ofthe Company's notice (a "Piggyback Registration"). Any such person that has made such

a written request may withdraw its Registrable Securities from such Piggyback Registration by

giving written notice to the Company and the managing underwriter, if any, on or before the fifth

business day prior to the planned effective date of such Piggyback Registration. The Company

may terminate or withdraw any registration under this Section 1.2(d) prior to the effectiveness of

such registration, whether or not Investor or any other Holders have elected to include

Registrable Securities in such registration.

(e) Ifthe registration referred to in Section 1.2(d) ofthis Annex E is proposed

to be underwritten, the Company will so advise Investor and all other Holders as a part of the

written notice given pursuant to Section 1.2(d) of this Annex E. In such event, the right of

Investor and all other Holders to registration pursuant to Section 1.2 of this Annex E will be

conditioned upon such persons' participation in such underwriting and the inclusion of such

person's Registrable Securities in the underwriting if such securities are of the same class of

securities as the securities to be offered in the underwritten offering, and each such person will

(together with the Company and the other persons distributing their securities through such

underwriting) enter into an underwriting agreement in customary form with the underwriter or

underwriters selected for such underwriting by the Company; provided that the Investor (as

opposed to other Holders) shall not be required to indemnify any person in connection with any

registration. If any participating person disapproves ofthe terms ofthe underwriting, such person

E-3
may elect to withdraw therefrom by written notice to the Company, the managing underwriters

and the Investor (ifthe Investor is participating in the underwriting).

(f) If either (x) the Company grants "piggyback" registration rights to one or

more third parties to include their securities in an underwritten offering under the Shelf

Registration Statement pursuant to Section 1.2(b) of this Annex E or (y) a Piggyback

Registration under Section 1.2(d) ofthis Annex E relates to an underwritten offering on behalf of

the Company, and in either case the managing underwriters advise the Company that in their

reasonable opinion the number ofsecurities requested to be included in such offering exceeds the

number which can be sold without adversely affecting the marketability of such offering

(including an adverse effect on the per share offering price), the Company will include in such

offering only such number of securities that in the reasonable opinion of such managing

underwriters can be sold without adversely affecting the marketability ofthe offering (including

an adverse effect on the per share offering price), which securities will be so included in the

following order of priority: (A) first, in the case of a Piggyback Registration under Section 1.2(d)

ofthis Annex E, the securities the Company proposes to sell, (B) then the Registrable Securities

of the Investor and all other Holders who have requested inclusion of Registrable Securities

pursuant to Section 1.2(b) or Section 1.2(d) ofthis Annex E, as applicable, pro rata on the basis

of the aggregate number of such securities or shares owned by each such person and (C) lastly,

any other securities of the Company that have been requested to be so included, subject to the

terms ofthis Agreement; provided, however, that ifthe Company has, prior to the Signing Date,

entered into an agreement with respect to its securities that is inconsistent with the order of

priority contemplated hereby then it shall apply the order of priority in such conflicting

agreement to the extent that it would otherwise result in a breach under such agreement.

1.3 Expenses of Registration. All Registration Expenses incurred in

connection with any registration, qualification or compliance hereunder shall be borne by the

Company. All Selling Expenses incurred in connection with any registrations hereunder shall be

borne by the holders ofthe securities so registered pro rata on the basis ofthe aggregate offering

or sale price ofthe securities so registered.

1.4 Obligations ofthe Comnanv. Whenever required to effect the registration

of any Registrable Securities or facilitate the distribution ofRegistrable Securities pursuant to an

effective Shelf Registration Statement, the Company shall, as expeditiously as reasonably

practicable:

(a) Prepare and file with the SEC a prospectus supplement or post-effective

amendment with respect to a proposed offering ofRegistrable Securities pursuant to an effective

registration statement, subject to Section 1.4 of this Annex E, keep such registration statement

effective and keep such prospectus supplement current until the securities described therein are

no longer Registrable Securities.

(b) Prepare and file with the SEC such amendments and supplements to the

applicable registration statement and the prospectus or prospectus supplement used in connection

with such registration statement as may be necessary to comply with the provisions of the

Securities Act with respect to the disposition of all securities covered by such registration

statement.

E-4
(c) Furnish to the Holders and any underwriters such number of copies ofthe

applicable registration statement and each such amendment and supplement thereto (including in

each case all exhibits) and of a prospectus, including a preliminary prospectus, in conformity

with the requirements of the Securities Act, and such other documents as they may reasonably

request in order to facilitate the disposition of Registrable Securities owned or to be distributed

by them.

(d) Use its reasonable best efforts to register and qualify the securities covered

by such registration statement under such other securities or Blue Sky laws ofsuch jurisdictions

as shall be reasonably requested by the Holders or any managing underwriter(s), to keep such

registration or qualification in effect for so long as such registration statement remains in effect,

and to take any other action which may be reasonably necessary to enable such seller to

consunnnate the disposition in such jurisdictions of the securities owned by such Holder;

provided that the Company shall not be required in connection therewith or as a condition thereto

to qualify to do business or to file a general consent to service of process in any such states or

jurisdictions.

(e) Notify each Holder of Registrable Securities at any time when a

prospectus relating thereto is required to be delivered under the Securities Act ofthe happening

of any event as a result of which the applicable prospectus, as then in effect, includes an untrue

statement of a material fact or omits to state a material fact required to be stated therein or

necessary to make the statements therein not misleading in light of the circumstances then

existing.

(f) Give written notice to the Holders:

(i) when any registration statement filed pursuant to Section 4.1(j) of

the Agreement or any amendment thereto has been filed with the SEC (except for

any amendment effected by the filing of a document with the SEC pursuant to the

Exchange Act) and when such registration statement or any post-effective

amendment thereto has become effective;

(ii) of any request by the SEC for amendments or supplements to any

registration statement or the prospectus included therein or for additional

information;

(iii) of the issuance by the SEC of any stop order suspending the

effectiveness of any registration statement or the initiation of any proceedings for

that purpose;

(iv) of the receipt by the Company or its legal counsel of any

notification with respect to the suspension of the qualification of the applicable

Registrable Securities for sale in any jurisdiction or the initiation or threatening of

any proceeding for such purpose;

(v) of the happening of any event that requires the Company to make

changes in any effective registration statement or the prospectus related to the

E-5
registration statement in order to make the statements therein not misleading

(which notice shall be accompanied by an instruction to suspend the use of the

prospectus until the requisite changes have been made); and

(vi) if at any time the representations and warranties of the Company

contained in any underwriting agreement contemplated by Section 1.40) of this

Annex E cease to be true and correct.

(g) Use its reasonable best efforts to prevent the issuance or obtain the

withdrawal of any order suspending the effectiveness of any registration statement referred to in

Section 1.4(f)(iii) ofthis Annex E at the earliest practicable time.

(h) Upon the occurrence of any event contemplated by Section 1.4(e) or

1.4(f)(v) of this Annex E, promptly prepare a post-effective amendment to such registration

statement or a supplement to the related prospectus or file any other required document so that,

as thereafter delivered to the Holders and any underwriters, the prospectus will not contain an

. untrue statement of a material fact or omit to state any material fact necessary to make the

statements therein, in light ofthe circumstances under which they were made, not misleading. If

the Company notifies the Holders in accordance with Section 1.4(f)(v) to suspend the use ofthe

prospectus until the requisite changes to the prospectus have been made, then the Holders and

any underwriters shall suspend use of such prospectus and use their reasonable best efforts to

return to the Company all copies of such prospectus (at the Company's expense) other than

permanent file copies then in such Holders' or underwriters' possession. The total number of

days that any such suspension may be in effect in any 12-month period shall not exceed 90 days.

(i) Use reasonable best efforts to procure the cooperation of the Company's

transfer agent in settling any offering or sale ofRegistrable Securities, including with respect to

the transfer ofphysical stock certificates into book-entry form in accordance with any procedures

reasonably requested by the Holders or any managing underwriter(s).

(j) If an underwritten offering is requested pursuant to Section 1.2(b) of this

Annex E, enter into an underwriting agreement in customary form, scope and substance and take

all such other actions reasonably requested by the Holders of a majority of the Registrable

Securities being sold in connection therewith or by the managing underwriter(s), if any, to

expedite or facilitate the underwritten disposition of such Registrable Securities, and in

connection therewith in any underwritten offering (including making members of management

and executives ofthe Company available to participate in "road shows", similar sales events and

other marketing activities), (A) make such representations and warranties to the Holders that are

selling stockholders and the managing underwriter(s), if any, with respect to the business of the

Company and its subsidiaries, and the ShelfRegistration Statement, prospectus and documents,

if any, incorporated or deemed to be incorporated by reference therein, in each case, in

customary form, substance and scope, and, if true, confirm the same if and when requested, (B)

use its reasonable best efforts to furnish the underwriters with opinions of counsel to the

Company, addressed to the managing underwriter(s), if any, covering the matters customarily

covered in such opinions requested in underwritten offerings, (C) use its reasonable best efforts

to obtain "cold comfort" letters from the independent certified public accountants of the

Company (and, if necessary, any other independent certified public accountants of any business

E-6
acquired by the Company for which financial statements and financial data are included in the

ShelfRegistration Statement) who have certified the financial statements included in such Shelf

Registration Statement, addressed to each of the managing underwriter(s), if any, such letters to

be in customary form and covering matters of the type customarily covered in "cold comfort"

letters, (D) if an underwriting agreement is entered into, the same shall contain indemnification

provisions and procedures customary in underwritten offerings (provided that the Investor shall

not be obligated to provide any indemnity), and (E) deliver such documents and certificates as

may be reasonably requested by the Holders of a majority of the Registrable Securities being

sold in connection therewith, their counsel and the managing underwriter(s), if any, to evidence

the continued validity of the representations and warranties made pursuant to clause (A) above

and to evidence compliance with any customary conditions contained in the underwriting

agreement or other agreement entered into by the Company.

(k) Make available for inspection by a representative of Holders that are

selling stockholders, the managing underwriter(s), if any, and any attorneys or accountants

retained by such Holders or managing underwriter(s), at the offices where normally kept, during

reasonable business hours, financial and other records, pertinent corporate documents and

properties of the Company, and cause the officers, directors and employees of the Company to

supply all information in each case reasonably requested (and ofthe type customarily provided in

connection with due diligence conducted in connection with a registered public offering of

securities) by any such representative, managing underwriter(s), attorney or accountant in

connection with such ShelfRegistration Statement.

(I) Use reasonable best efforts to cause all such Registrable Securities to be

listed on each national securities exchange on which similar securities issued by the Company

are then listed or, if no similar securities issued by the Company are then listed on any national

securities exchange, use its reasonable best efforts to cause all such Registrable Securities to be

listed on such securities exchange as the Investor may designate.

(m) If requested by Holders of a majority of the Registrable Securities being

registered and/or sold in connection therewith, or the managing underwriter(s), if any, promptly

include in a prospectus supplement or amendment such information as the Holders of a majority

of the Registrable Securities being registered and/or sold in connection therewith or managing

underwriter(s), if any, may reasonably request in order to permit the intended method of

distribution of such securities and make all required filings of such prospectus supplement or

such amendment as soon as practicable after the Company has received such request.

(n) Timely provide to its security holders earning statements satisfying the

provisions of Section I I(a) ofthe Securities Act and Rule 158 thereunder.

1.5 Suspension of Sales. Upon receipt of written notice from the Company

that a registration statement, prospectus or prospectus supplement contains or may contain an

untrue statement of a material fact or omits or may omit to state a material fact required to be

stated therein or necessary to make the statements therein not misleading or that circumstances

exist that make inadvisable use of such registration statement, prospectus or prospectus

supplement, the Investor and each Holder of Registrable Securities shall forthwith discontinue

disposition of Registrable Securities until the Investor and/or Holder has received copies of a

E-7
supplemented or amended prospectus or prospectus supplement, or until the Investor and/or such

Holder is advised in writing by the Company that the use of the prospectus and, if applicable,

prospectus supplement may be resumed, and, ifso directed by the Company, the Investor and/or

such Holder shall deliver to the Company (at the Company's expense) all copies, other than

permanent file copies then in the Investor and/or such Holder's possession, of the prospectus

and, if applicable, prospectus supplement covering such Registrable Securities current at the time

ofreceipt ofsuch notice. The total number of days that any such suspension may be in effect in

any 12-month period shall not exceed 90 days.

1.6 Termination of Registration Rights. A Holder's registration rights as to

any securities held by such Holder (and its Affiliates, partners, members and former members)

shall not be available unless such securities are Registrable Securities.

I.7 Furnishing Information.

(a) Neither the Investor nor any Holder shall use any free writing prospectus

(as defined in Rule 405) in connection with the sale of Registrable Securities without the prior

written consent ofthe Company.

(b) It shall be a condition precedent to the obligations ofthe Company to take

any action pursuant to Section 1.4 of this Annex E that Investor and/or the selling Holders and

the underwriters, if any, shall furnish to the Company such information regarding themselves, the

Registrable Securities held by them and the intended method of disposition ofsuch securities as

shall be required to effect the registered offering oftheir Registrable Securities.

1.8 Indemnification.

(a) The Company agrees to indemnify each Holder and, if a Holder is a

person other than an individual, such Holder's officers, directors, employees, agents,

representatives and Affiliates, and each person, if any, that controls a Holder 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 registration statement, including any preliminary

prospectus or final prospectus contained therein or any amendments or supplements thereto or

any documents incorporated therein by reference or contained in any free writing prospectus (as

such term is defined in Rule 405) prepared by the Company or authorized by it in writing for use

by such Holder (or any amendment or supplement thereto); 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; provided, that the Company

shall not be liable to such Indemnitee in any such case to the extent that any such loss, claim,

damage, liability (or action or proceeding in respect thereof) or expense arises out of or is based

upon (A) an untrue statement or omission made in such registration statement, including any

such preliminary prospectus or final prospectus contained therein or any such amendments or

supplements thereto or contained in any free writing prospectus (as such term is defmed in Rule

E-8
405) prepared by the Company or authorized by it in writing for use by such Holder (or any

amendment or supplement thereto), in reliance upon and in conformity with information

regarding such Indemnitee or its plan of distribution or ownership interests which was furnished

in writing to the Company by such Indemnitee for use in connection with such registration

statement, including any such preliminary prospectus or final prospectus contained therein or any

such amendments or supplements thereto, or (B) offers or sales effected by or on behalf ofsuch

Indemnitee "by means of' (as defined in Rule l59A) a "free writing prospectus" (as defined in

Rule 405) that was not authorized in writing by the Company.

(b) If the indemnification provided for in Section 1.8(a) of this Annex E 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 Company, 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 Company, 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 ofthe Company, on the one hand, and ofthe 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 Company or by the

Indemnitee and the parties' relative intent, knowledge, access to information and opportunity to

correct or prevent such statement or omission; the Company and each Holder agree that it would

not be just and equitable if contribution pursuant to this Section 1.8(b) of this Annex 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 1.8(a) of this Annex E. No Indemnitee

guilty offraudulent misrepresentation (within the meaning of Section 1I(f) ofthe Securities Act)

shall be entitled to contribution from the Company if the Company was not guilty of such

fraudulent misrepresentation.

1.9 Assignment of Registration Rights. The rights of the Investor to

registration ofRegistrable Securities pursuant to Section 1.2 ofthis Annex E may be assigned by

the Investor to a transferee or assignee of Registrable Securities; provided, however, the

transferor shall, within ten days after such transfer, furnish to the Company written notice ofthe

name and address of such transferee or assignee and the number and type of Registrable

Securities that are being assigned.

1.10 Clear Market. With respect to any underwritten offering of Registrable

Securities by the Investor or other Holders pursuant to this Annex E, the Company agrees not to

effect (other than pursuant to such registration or pursuant to a Special Registration) any public

sale or distribution, or to file any Shelf Registration Statement (other than such registration or a

Special Registration) covering any preferred stock ofthe Company or any securities convertible

into or exchangeable or exercisable for preferred stock of the Company, during the period not to

exceed ten days prior and 60 days following the effective date of such offering or such longer

period up to 90 days as may be requested by the managing underwriter for such underwritten

offering. The Company also agrees to cause such of its directors and senior executive officers to

E-9
execute and deliver customary lock-up agreements in such form and for such time period up to

90 days as may be requested by the managing underwriter.

1.11 Forfeiture of Rights. At any time, any holder of Registrable Securities

(including any Holder) may elect to forfeit its rights set forth in this Annex E from that date

forward;provided, that a Holder forfeiting such rights shall nonetheless be entitled to participate

under Section 1.2(d) - (f) of this Annex E in any Pending Underwritten Offering to the same

extent that such Holder would have been entitled to if the holder had not withdrawn; and

provided, further, that no such forfeiture shall terminate a Holder's rights or obligations under

Section 1.7 of this Annex E with respect to any prior registration or Pending Underwritten

Offering.

1.12 Specific Performance. The parties hereto acknowledge that there would

be no adequate remedy at law if the Company fails to perform any of its obligations under this

Annex E and that the Investor and the Holders from time to time may be irreparably harmed by

any such failure, and accordingly agree that the Investor and such Holders, in addition to any

other remedy to which they may be entitled at law or in equity, to the fullest extent permitted and

enforceable under applicable law shall be entitled to compel specific performance of the

obligations ofthe Company under this Annex E in accordance with the terms and conditions of

this Annex E.

1.13 No Inconsistent Agreements. The Company shall not, on or after the

Signing Date, enter into any agreement with respect to its securities that may impair the rights

granted to the Investor and the Holders under this Annex E or that otherwise conflicts with the

provisions hereof in any manner that may impair the rights granted to the Investor and the

Holders under this Annex E. In the event the Company has, prior to the Signing Date, entered

into any agreement with respect to its securities that is inconsistent with the rights granted to the

Investor and the Holders under this Annex E (including agreements that are inconsistent with the

order of priority contemplated by Section 1.2(f) of Annex E) or that may otherwise conflict with

the provisions hereof, the Company shall use its reasonable best efforts to amend such

agreements to ensure they are consistent with the provisions of this Annex E.

1.14 Certain Offerings by the Investor. An "underwritten" offering or other

disposition shall include any distribution of such securities on behalf of the Investor by one or

more broker-dealers, an "underwriting agreement" shall include any purchase agreement entered

into by such broker-dealers, and any "registration statement" or "prospectus" shall include any

offering document approved by the Company and used in connection with such distribution.

E-lO
ANNEXF

OFFICER'S CERTIFICATE

OF

[COMPANY]

In connection with that certain letter agreement, dated [ ], 2010

(the "Agreement") by and between [COMPANY] (the "Company") and the United States

Department of the Treasury ("Investor") which incorporates that certain Securities Purchase

Agreement -Standard Terms referred to therein (the "Standard Terms"), the undersigned does

hereby certify as follows:

I. I am a duly elected/appointed L[ -'] ofthe Company.

2. Each Certified Entity (as defined in the Standard Terms) (A) is certified by

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

Department of the Treasury as a regulated community development financial institution (a

"CDFf'); (B) together with its Affiliates collectively meets the eligibility requirements of 12

C.F.R. 1805.200(b); (C) has a primary mission ofpromoting community development, as may be

determined by Investor from time to time, based on criteria set forth in 12 C.F.R. 1805.201(b)(1);

(D) provides Financial Products, Development Services, and/or other similar financing as a

predominant business activity in arm's-length transactions; (E) serves a Target Market by

serving one or more Investment Areas and/or Targeted Populations in the manner set forth in 12

C.F.R. 1805.201(b)(3); (F) provides Development Services in conjunction with its Financial

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

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

Population(s) through representation on its governing Board of Directors or otherwise; and (H)

remains a non-governmental entity which is not an agency or instrumentality 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. As used herein,

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.

3. The information set forth in the CDFI Certification Application delivered

to the Investor pursuant to Section 2.3(m) of the Standard Terms (the "CDFI Application"), as

modified by any updates to the CDFI Application provided on [Insert Date(s)] by the Company

to the Investor on or prior to the date hereof, with respect to the covenants set forth in Section

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

ofthe date hereof.

F-l
4. The contracts and material agreements entered into by each Certified

Entity 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 Certified Entity

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 each Certified Entity as ofthe date hereof,

(B) to the extent any member ofthe 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.l(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 any Certified

Entity 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) ofthe Standard Terms on [Insert Date), a narrative describing such change.

6. Each Certified Entity is not an agency ofthe United States of America, or

any State or political subdivision thereof, as described in 12 C.F.R. l805.20l(b)(6) and within

the meaning of any supplemental regulations or interpretations of 12 C.F.R. l805.20l(b)(6) or

such supplemental regulations published by the Fund.

7. [Insert ifthe Company was a Bank Holding Company or a Savings and

Loan Holding Company on the Signing Date: The Company is and has been at all times since

the date of the last certification provided to the Investor pursuant to Section 4.l(d)(ii) of the

Standard Terms, a [Insert if the Company is a Bank Holding Company: Bank Holding

Company) [Insert ifthe Company is a Savings and Loan Holding Company: Savings and Loan

Holding Companyj.] The Company is not, and has not been at any time since the date ofthe last

certification provided to the Investor pursuant to Section 4.l(d)(ii) of the Standard Terms on

[Insert Date], controlled (within the meaning of [Insert for banks and Bank Holding

Companies: the Bank Holding Company Act of 1956 (12 U.S.C. l84l(a)(2)) and 12 C.F.R.

225(a)(i)J[Insert for savings associations and Savings and Loan Holding Companies: the

Home Owners' Loan Act of 1933 (12 U.S.C. l467a (a)(2)) and 12 C.F.R. 583.7)) by a foreign

bank or company.

The foregoing certifications are made and delivered as of L[ -'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)

F-2
IN WITNESS WHEREOF, this Officer's Certificate has been duly executed and

delivered as ofthe U day of[ ],20U.

[COMPANY]

By: _

Name:

Title:

F-3
EXHIBIT A

NEW CONTRACTS AND MATERIAL AGREEMENTS

Exh. A-I
EXHIBITB

BOARD OF DIRECTORS

Exh. B-1
SCIIEIlULE A

AlllJITIO:"AL TE R~ IS AN Il CO :" IlI T IO:"S

Company Infommtion:

Name of the Company: Liberty Financia l Servtccs. juc.

Corporate or other organizational Conn o f Company: Ccr porutfon

Jurisdiction of Organization ofCompany: Stale of Loulslana

Appropriat e Federal Banking Agency ofCompany: Federal Reserve Rank

'arne of Certified Entities: Liberty Bank and Trust Co mpa ny

Corporate or other organizational Conn of each Certified Entity: Corporation

Jurisdiction of Organization of each Certified Entity: Lo uisiana

Appropriate Federal Banking Agency of each Certified Entity:

Federal Reserve Ba nk

Notice Informa tion :

Libert)' Financial Se rvices, Inc.

P.O. Box 60 131

New O rle a ns. LA 70160

TcmlSofthe Purchase:

Series of Preferred Stock Purchased :

Fixed Rat e Cumulative Perpetual Preferred Stock. Series A-I

Per Share Liquidation Preference of Preferred Stock: SI,OOOper share

Number of Shares of Preferred Stock Purchased: 5.689 shares

Dividend Payment Dates on the Preferred Stock: Payable quarterly in arrears a ll February'

IS.l\l ay 15. August IS and Novembe r 15 oreach year.

Purchase Price: S5.689.000

UST Sequence No. 55I
Closing:

Date ofClosing: September ;;)'1. 2010

J,Jawi'oik.. i

I;) p"-'m'-'----_

Location ofClosing: _!>I.~~---.J.Q:£K,---.!"'-=:L _

Time ofClosing:

Wire Information for Closing:

Han k: Liberty Bank and Trust Company

Account xamc: Liberty Financial SHS.

Inc.

Ben eficia ry ; Liberty Fina ncial Services.

Inc.

Contact for Confirmation of Wire Information:

Liberty Ban k and Trust Company

6600 Plaza Drive

i\ ew Orleans. LA 70127

UST Sequence No, 55I
SCI m DUU : u

CA PITALI ZATI O N

Capitalization Date:

Common Stock

To tal Authorized:

Subject to warrants. options, convertible

sec urit ies, etc.: Nonc

Reserved for benefit plans and other issuances: No ne

authori zed but unissued:

Shares issued after Capitalization Date (other than pursuant to wa rrants. options.

convertible securities, cleoas set forth above): No ne

Preferred Stock

Par value: 0

Total Authorized: 1,000,000

Outstand ing (by series): 5.645 Fixed Rate Cu mulative Per petual Preferred Stock.

Series ••A"

Outstanding (by se ries): 5,6-45 Fixed ROlle Cumulative Per petu al Preferred Stock,

Series "Ael"

Reserved for issuance: None

Remaining authorized but unissued: 988,710

UST Sequence No. 551
"olden of 5% or mort' of any class of capital stock

Shareholder

4.948%

7.646%

11.924%

5.663%

22.128%

USl' Sequence No. 55 /
scnenut.s C

MATERIAL ADVE RSE EFFECT

List any exceptions to the representation and warranty in Section 3.1(g) ofthe Securities

Purchase Agreemen t - Standard Terms.

If none, please so indicate by checking the box: 0 .

UST Sequence No. 551
SCH EDU LE IJ

I.ITIGATIO:-;

List any exceptions to the representation and warranty in Section 3.1(I) ofthe Securities

Purchase Agreement - Standard Terms.

lf nonc. please so indicate by checking the box: C8J.

USTSequence No. 551
SC II EDULE E

II L1 I': WITII LAWS

List any exceptions to the representation and warranty in the second sentence ofSection 3.1(m)

of the Securities Purchase Agreement - Stan dard Terms.

If none, please so indicate by checking the box : [8].

List any exceptions to the representation and warranty in the last sentence ofScction 3.1(m) of

the Securities Purchase Agreement - Standard Terms.

If none, please so indicate by checking the box : {81.

USTSequence No. 55}
SClllmULE F

REGULATO IW AG REE~IEI':TS

List any exceptions to the representation and warranty in Section 3.1(s) of the Securities

Purchase Agreement - Standard Terms.

Ifnone, please so indicate by checking the box: rgJ.

UST Sequenc e No. 551