UNITED STATES DEPiJ..RTMENT OF THE TREASURY

1500 PENNSYl,v.t\;-.;rA AVENUE, N\V

WASHlr-;GTON, D.C. 20220

Dear Ladies and Gentlemen:

The company set forth on the signature page hereto (the "Company") intends to issue in a

private placement the number of shares of a series of its prefcrrcd stock set forth on Schedule A

hereto (the "Preferred Shares") and 3. \varrant to purchase the number of shares of its common

stock set forth on Schedule A hereto (the "H-I'arrant" and, together with the Preferred Shares, the

"Purchased Securities") and the United States Department of the Treasury (the "Investor")

intends to purchase from the Company the Purchased Securities.

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

purchase by the Investor of the Purchased Securities. 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superseded by the terms set forth herein or in the Schedules hereto, the provisions contained in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 Tenus attached hereto as Exhibit A (the

"Securities Purchase Ar:reement") arc incorporated by reference herein. Terms that are defined

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

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

tenns of this letter agreement shall govern.

Each ofthc Company and the Investor hereby con1Jm1s its agreement with the other party

with respect to the issuance by the Company of the Purchased Securities and the purchase by the

Investor ofthe Purchased Securities pursuant to this letter agreement and the Securities Purchase

Agreement on the tenTIS specified on Schedule A hereto.

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

Agreement (including the Annexes thereto) ami the \Varrant eonstihlte (he entire agreement, and

supersede all other prior agreements, understandings, represenlations and v,rarranties, both

~Tjtt(.'n and oral, bettveen the parties, \vith respect to Ih.:'_ subject matter hereof. This letter

agreement constitute:; the "Letter Agreement" reterred to in the Securities Purchase Agreement.

This letter agn.',ement may be executed in any number ofseparate counterparts, each such

COlllltcrpolt bcing deemed to he an original instrumeIlt, and all such coumerpiu·ts will together

constitute lhe same agrc(':m.'nt, Execlltl'd signafurc pugt'S tu this !cHer ~lgr('ernent may be

ddive:-ccl byi2.csimile and such facsimilesl.viH be deemed as ~u1iicicnt 8.::; if 11t:Ual $lgnaw[c

pages lwd be~n de;ivcfcd.
In Wl!l1C:-;S \\,';lI:rcoC thlS Idler a~r(\..'m(;nt hi1:'i lx'en (hi:; c\c('lItc:d and dehwfcd bv lhe

duly ;1H1:"iunzcd r(:prl'SCtltJllVC~ ufthc pames 11..'1"(::10 <.IS of ih«' date written helm\'

YADKI"! V,,\LLEY FI0!ANCIAL

CORPORATION

Nal1l"'-:: \Vrlham A. Long

Title: PresKlen[ and Chicf Executive OfClccr
In v,ritness \vhercof, this letter agreement has been duly executed and delivered by the

duly authorized representaiiycs of the parties hereto as ofthe date written bela'N.

UNITED STATES DEPARTMENT OF THE

TREASURY

By:~ _

Name:

Title:

YADKIN VALLEY FINANCIAL

CORPORATION

l' ,

'I I' /J "~I I.. .."" i .--,,'...... , By: {/\/,l.,~t{.,(;\c'P"V·'-~ /:- <,-.1'{.,[~~"

Name: WdlIam A. Long '"

Title: President and ChiefExecutive Officer
SECURITIES PURCHASE AGREEMENT

SECURITIES PURCHASE AGRElcMENT

STANDARD TERMS

EXHIIlIT A
TABLE OF CONTENTS

Pa~e

l\rtide 1

Purchase; Closing

1.1 Purchase , , ,.. , ,...... . 1

1.2 (]osing , ,. " , , , 2

1.3 Interpretation ,............ . .4

Article II

Representations and \Varrantics

2.1 })isclosure ., ,.............. . 4

2.2 Representations and V/ananties ofthe Company...... . 5

Article III

Covenants

3.1 Commercially Reasonable Etforts , , , , 13

3.2 Expenses , 14

3.3 Sufficiency of Authorized Common Stock: Exchange Listing 14

3.4 Certain Notifications Until Closing I5

3.5 Access, Infomlation and Confidentiality , , , , 15

Article IV

Additional Agreements

4.1 Purchase for Investn1ent. , 16

4.2 Legends 16

4.3 Certain Transactions..... . , ,18

4.4 Transfer of Purchased Securities and Warrant Shares; Restrictions on Exercise

ofthe \V'arrant .. . 1g

Registration Rights ,....... .. , , 19

Voting of\Varrant Shares 30

IJepositary Shares , , , , , , , 30

Restriction on Dividends and Repurchases , , 31

Repurchase of Investor Securities , , , , , , 31

Executive Compensation . ,.,,, .:.3

4.5

4.6

4.7

4.8

4.9

4.10

Artidc V

Miscellaneous

5.l Tenni1l3tioll " _ .,_............................... ... , ." , 33

5.1 Survival 0fReprcsentation,> and \\'arrRIl1.ies .." " "..... . ,34

5.3 ,:~.lne.ndmellt" " , ,.. , " "......... .J4

54 Waiver of Conditions ", _ _. . ,., .34

5.5 GflH'Tlling ]Jaw: Submis~i.:m to ,Jurisdiction, £t~" " , , 34

5,6 !'\otlces ,..... .." _., . _." 35-

5.7 '[Jefiniil,)ns ".. ,.. ,.,........ .. ." _...... .. , ,.3:5

5.R As:signnlcni ."" ,.. .. ,_ " ._ , ,..".. . , 36

'::;,9 Severability " ., , ., .. , .36

S.IO No Thild Party !--k:n('lkialie:-.. .. J6
ANNEXA:

ANNEX B:

ANNEXC:

ANNEXD:

LIST OF ANNEXES

fORM UF CERTIFICATE OF DESIGNATIONS FOR PREFERRED STUCK

fORM OF WAIVER

FOMl OF OPINION

FORM OF WARRANT

II
Term

INDEX OF DEFINED TERMS

Location of

Definition

Affiliate

Agreement

Appraisal Procedure

Approprinte federal Banking Agency

Bankrllptcy Exc<"ptiol1s

Benefit Plans

Board of Directors

Business Combination

Business Day

Capitalization Date

CCltiiicatc of Designations

Charter

Closing

Closing Date

Code

Common Stock

Company

Company Financial Statcmenl<;

Company Material Adverse Effect

Company Reports

Company Subsidiary; Company Subsidiaries

Control; Controlled By; Under Coml11on Control With

Controlled Group

cpp

EESA

ERISA

Exchange Act

FaiT !darkct Value

GAM

Govemmental Entities

Holder

Holders' Counsel

Indemnitee

InlormaliOJl

Initial W,UT<.1Jlt Sbare~

Invt',5v,Jr

Junior Stock

Kn()\vledgt' of the Company; COlnp,my's Ktl<y,vledgc

I,asl FiSCJl \'t;ar

l.etter Ag:reement

!l1

5.7(b)

R.ecitals

4.9(c)(i)

2.2(s)

2.2(d)

L2(d)(iv)

2.2(1)

4.4

IJ

2.2(b)

1.2(d)(iii)

1.2(d)(iii)

1.2(a)

1.2(a)

2.2(n)

Recitals

Recitals

2.2(h)

2.1(a)

2.2(i)(i)

0'(··(·) ..... ,;., 1) 1

5.7(b)

2.2(11)

Recitals

1.2(d)(iv)

00 ) "',L.\11

2.1(b)

4.9(c)(ii)

2.1 (a)

l.2(c)

4.5Ik)(i)

45(k\(iJ)

4.S(gjd)

.l0(b)

Ret'"itals

Recitals

4.8(c)

.:; 1( . ..'., C)

2.1(b)

R('..::itaL~
Term

Ofticers

Parity Stock

Pending UnderwTitten Offering

PenniHed Repurchases

Piggyback Registration

Plan

Preferred Shares

Prderred Stock

Previously Disclosed

Proprietary Rights

Purchase Recitals Purchase Price

Purchased Securities Recitals Qualified Equity Offering

Register; Registered; Registration

Registrable Securities

Registration Expenses

Regulatory Agreement

Rule 144; Rule 144A; Rule 159A; Rule 405; Rule 415

Schedules Recitals

Securities Act

Selling Expenses

Senior Executive OJ1icers

Share Dilution Amount

Shelf Registration Statement

Signing Date

Special Registration

Stockholder Proposals

Subsidiary

Tax; Taxes

Transfer

\\farrant Recitals Warrant Shares

1\

Location of

Definition

5.7(c)

4.8(c)

4.5(1)

4.8(a)(IO

4.5(a)(iv)

2.2(n)

Recitals

Recitals

2.1(b)

2.2(u)

1.1

4.4

4.5(k)(iii)

4.5(k)(iv)

4.5(k)(v)

2.2(5)

4.5(k)(vi)

SEC2.I(b)

2.2(a)

4.5(k)(vii)

4.10

4.8(a)(lI)

4.5(a)(II)

2.1 (a)

4.5(i)

3.J(b)

5.8(8)

2.2(0)

4.4

2.2(d)
SECURITIES PURCHASE AGREEMENT - STANDARD TERMS

Recitals:

WHEREAS, the Cnitcd States Department of the Treasury (the "investor") may from

time to timt agree to purchase shares of rrden~d stock and wanants from eligible financial

institutions w'hich elect to participate in the Trollbled Asset Relief Prognun Capital Purchase

Program CCPP");

V/HEREAS, an eligible financial institution electing to participate in the CPP lUld issue

securities to the Investor (referred to herein as the "Company") shall enter into a letter agreement

(the "LeEter Agreemcnr") with tbe Investor which incorporates this Securities Purchase

Agreement St,mdard Term:;:;;

WHERJ::AS, the Company agrees to expand the f1ov\' of credit to U.S. consumers and

businesses on competitive tcnns to promote the sustained growth and vitality of the U.S.

economy;

\VHEREAS, the Company agrees to work diligently, under existing programs, to modify

the terms of residential mortgages as appropriate to strengthen the health of the U.S. housing

market;

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

the series of its Preferred Stock ("Preferred Stock") set forth on Schedule A to the Letter

Agreement (the "Pre/erred Shares") and a wa.lTanl to purchase the nwnber of shares of its

Common Stock ("Common /)'iock'') set forth on Schedule A to the Lelter Agreement (the "Initial

JVarranl Shares") (the "Warrant" and, together with the Preferred Shares, the "Purchased

/)'ecurities") and the Investor intends to purchase (the "Purchase") trom the Company the

Purchased Securities; and

WHEREAS, the Purchase will be governed by this Sccuritie:; Purchase Agreement --

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

specifying additional terms of the Purcha:,;e. This Securities Purchase Agreement - Standard

Terms (including the Annexes hereto) and the Lt.'Uer Agreement (induding the Sc-hedules

the-reto) arc together wfen'cd to as this "Agreement". All references in this Securities Purcha,.:;c

Agreement Standard remlS to "Schedules" arc to the Schedules <1ltachcd to lhc Letter

..Agreement.

NOW, THEREFORE, in consideration of the premises, ,md uf the representations,

warranties, covenaals Hnd agreements ;.;et 1{lrth ht'rein, the parties agree as l.\".lllows:

Artide I

Pun;ha~c; Closin~

/.1 .l?1,!E:!P~s', On the k,'ms and suhj~~ct to the condi:ions ~"::1 E:ltb In ;hb: Agl'('er.1enL

HI(' C(\n)~allY agJc;:,s kl :--<:11 to th(~ Inv(,.,wr. ~nd lhe Investor agrt~(·:; w nurChiIS{' !ronl th~
Company, at the Closing (as hefeinafter defined), the Purchased Securities for the price set forth

011 ~('heduJ(' A (the "Purchase Price").

(a) On thl: terms and ::'Uhji;'ct to the conditions set fol1h in this Agreement, the

closing oCthe Purchase (the "C(osing") will take place at the location specified in Sche~dule A, at

the time and on the date set forth in Schedule A or as soon as prllcticahlc thereafter, or at suc.h

other place, time and date <IS shall be agreed between the Company and the Investor. The time

and date on which the Closing occurs is rcierred to in this Agreement as the "Closiflg Date".

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

Section 1.2, at the Closing the Company \vill delivcr the PrcfclTcd Shares ;:md the \X/arrant, in

each case as evidenced by one or more CC11ificatcs 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 immediatcfy available United States funds to a bank account designated

by the Company on Schedule A.

(c) The respective obligations of each of the Investor and the Company to

consummate the Purchase are subject to the fulfillment tor \\i'aiver by the Investor and the

Company, as applicable) prior to the Closing of the conditions that (i) any approvals or

authorizations of all United States and other governmental, regulatory or judicial authorities

(collectively, "Governmental Entities") required for the consummation of the Purchase shall

have been obtained or made in fonn and substance reasonably satisfactory to each party and shall

be in full force and cftect and all \'{aiting 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. i11jUllCtioll, order or decree of an:y Govcnunental Entity shall prohibit the

purchase and sale ofthe Pmchascd Securities as contemplated by this Agreement.

(d) 'TIle obligation of the Investor to i.:OnSlllTlmak the Purchase is also subject

to the fulfillment (Of \vuiver by the Inyestor) at or prior to tile Closing of each of the following

conditions:

{i) fA) the rcprcscntntiom rmd warranties of the Comp.::my set fOlih in

(x) Section 2.2(g) of this Agreement shall be true and COm'ct in all respect:') a, though

made on and as of tbe Closing Date, (y) Sections 2.2(3) through (t) :i'hall bc true Hnd

correct in all material respects as though made on and as nf the Closing Date (oth~r than

representatiotls and \varranties that by their 1enn~ spcilk as of ~m(}ther dak. w-hich

repres('ntations Jnl! warr;ultlCs shall be true and correct m 3ll malcrlu!respt'('ts as ofsudl

other date) and (z) Sections 2.2(h) through (v) (disregarding all qu~l1Jiicatj('ns or

limitations s\."r forth i.n sud1 repn::s,;;ntltiolls and wammties as to "mat('(iaEry", "Company

Mi.llerial AdYLTSe EiT~ct" 3:11i words ofsimilar import) shaH be true and ,:orrccl a:'i thnugh

nude i)n and a<; of the Closing, Dalt' (otr..;-',r than represc!l(,·\tinT1S and \VU1Tl:111Hes that by

their term,,:; speak ~:s 01' <luother dalt!. v,<bich rcprc:-:entaljf).HS and ,.vanantiz:s ,,,hall be- true

,mJ corn,:ct ;L":; of sn~h o111tr dilt;;;), ex(:ept to tll1..: t'Xlelll ihat the ii'tijUJ(, (If ,%ch

re.pre:>entati\.\l1s ,U1J "\'iln'~:m!!ei) ref\:~iTed tu il; !bi.:-: Si.~c1jon : .2(drCi){A)1,z) to b,~ S') tnJe emd
corred, individually or in the aggregate, does not have and would not reasonably be

expected to have a Company Material Adverse Elfect and (B) the Company shall have

perfoI1l1ed in all material respects all obligations required to be ptrlonned by it under this

Agreement at or prior to the Closing;

(ii) the Investor shaH have received a certi1icate signed on hcbalC of

the Company by a senior executive officer certifying to the effect that the conditions set

fiJrth in Section l.2(d)(i) have been satisfied:

(iii) the Company shall have duly adopted ;:md filed \\lith the Secretary

of State of its jurisdiction of organization or other applicable Governmental Entity the

amendment to its certificate or articles of incorporation, anides of association, or similar

organizational document ("Charter") in substantially the form attached hereto as Al1!leX

A (the "Cert(/lcate (!f DesignCitions") and such filing shall have been accepted;

(iv) (A) the Company shall have eJlected such changes to its

compensation, bonus, incentive and other benefit plans, arrangements and agreements

(including golden parachute, severance and employment agreements) (collectively,

"Benejitl'lans") with respect to its Senior Executive Otliccrs (and to the extent necessary

for such changes 10 be legally enforceable, each of its Senior Executive Officers shall

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

that the Investor ovms any debt or equity securities of the Company acquired pursuant to

this Agreement or the Warrant, in order to comply with Sectionlll(b) of the Emergency

Economic Stabilization Act of 2008 ("EESA") as implemented by guidancc or regulation

thereunder that has been issued and is in effect as of the Closing Date, and (n) the

Investor shall have received u certificate signed on behalf of the Company by a senior

executive officer certifying to the eHect that the condition set forth in Section

l.2(d)(iv)(A) has been satistied;

(v) each of the Company's Senior Executive OITicers shall have

delivered to the Im"es1or a \\Titlen \'1'aiver in the form attached hereto as Annex B

releasing the Investor from any claims that such Senior Executive Officers may otherwise

huvc as a result of the issuance, on or prior to the Closing Date, of any regulations which

rctjujrc the modification of, and the agreement of the Company hereunder to modify, the

tenllS of;my Benefit Plans ,,,"tth respect to its Senior Executiyc Officers to eliminate ,my

pmdsions of such Benefit Plans that WQuld not be in complia1lce with the reqHir~mcnls

of Section 111 (b) of the EESA as implemented by guidiUltC or r...:gulation thcrcund~r that

has been issued and is in I:ffect as ofthe Closing Date;

(vi) the CompJny ;-;haU han.' delivered to the Invt'~tor a writren opini01l

from coun::.:.cl hi the Comp:.my (which m~:y be intemal cuut1~-:'I), nddres:;(·J to th<.:: Investor

and dated i.1S offill.> Closing Dale. ic suh&tanliilIly the form att~l('bed heretu 35 AnnexJ2;

(vii) th(' Company .~hJ.ll h<n<:: ddi\'(~n~d ce:'1ifkak,';; in rn>pe:r f1XIn or,

"dtll the rri(\r (~ons(;r:t of the Invcstor, c\iOt,n;,;e ()f .-:.11,"1[';';5 in hook~eltrv, form, rvidc,ncing. 11K' Pret;::n:e:d Sh~l.r\;'-" [fl InH.',.:;tJX (If Its d;:,'signe:'{s): [llJJ

.>
(viii) the Company shall have duly executed the \),/ammt in substantially

the form attached hereto as Armcx D and delivered such executed \Varrant to the rnveslor

or its dcsignec(:;).

IJ InlQrpreti.l~Ql1- When a reference is made in this Agreement to "Recita.Js,"

"Articles," "Sections;' or ".i\rult'XCS" such fl'fcrcncc shall he to a Recital, Article or Section of.

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

"Schedules" shaH be to a Schedule to the Letter Agreement, in each case, unles::: otherwise

indicated. The tenns dcHned in the singular have a comparable meaning vvhcn 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

othcr\\,-ise. The table of contents and headings contained in this Agreement are for reference

purposcs only and arc not part of this Agreement. \Vhenevef the v,/Ords "include," "includes" or

';induding" are used in this Agreement. they shall be deemed follov,'ed by the ''lords "without

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

the interpretation or enforcement of this Agreement, as this Agreement is thc product of

negotiation between sophisticated parties advised by counsel. All references to "$" or "dollars"

mean the la\vful currency of the United States of America. Except as expressly stated in this

Agreement, all references to any st.'1tute, 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 statutc,

rule or regulation include an:y 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 generally arc authorized or required hy law or other governmental action;;; to close,

Article n

Representations and \Varranties

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

th~ business, results of operation or Jinancial condition of the Company and its consolidated

subsidiaries tak~n as a whole; proviJed, IUJlj,'cver, that Company l''vlaterial Adverse Efiect shall

not he deemed to include the effect" of (A) changes ailer the date (If the Letter Agreement (the

'\5iWliflf; Date") in gen(TaJ husine~s, econon'Jic or market conditions (induding dumges

generally in prc\;ailing inkrest nllcs. credil avaiiability and liquidity, currency exchange ratcs

and price k:",-eJs or trading voltuHes in the United Stules or foreign securities or credit marketsl,

N any oUfbreak or escalation ()f ho~tjlitjes, ,fe(.lared or undeclared ads of war (ll' terrorism, in

each ca.s\.'" generally i.1ffc'_cting tb-.; indu."lries in which the Company and irs subsidii:U"ii."s op\.~rJ.tt\

(H> ch"lItges or proposed change:- atiLT the Signing. Oak In gi::!lt'raJly ~KCel)kd acco\l1lting

principles in lhe t":n;led Stale.:> (''(dAr') or r~gu)a(or) ~lccol1n1jng requircm-:nt:;:. or aUlhoritalive

intlTpfl.:i;i!JOllS thereof {C) L:hiJngc-s or prq'\)sed c:h(tnge~ art';:f the SignlJl:g ,Date in ::;cl;;uriti(,.'s,

btU/king and other la,":> of gCJlt'.ral appJj(;i1ht1ity ,,)1' relate;:l poJidcs UC" in!cqw('tations of

(iovcmmemal l':,ntitie:-; (i:l tbe (',ClSt of each (~f the3C cbuscs C",,',!, (H) and (Cj. other th:1,n changes

(!r Geeu!"t'll(:\.'S tu :!tc t'xknt that sad: ctDnges (If oz'("urrcnces bave Gr would rca~i.mably b{'

4
expected to have a materially disprop0l1ionatc adverse dTed on the COl11P~lllY and its

consolidated subsidiaries taken as a \\:bole relative to comparable U.S. banking or financial

services organi;>.ations), or (D) changes in the market price or trading volume of the Conullon

Stock or any other equity. cquity~relatcd or debt securities of the Cumpany or its Cotlso1idakd

subsidiaries (it being understood and agreed that the exception :o;et forth in this clause (D) does

not apply to the underlying reason giving rise to or contributing to any such change); or (ii) the

ability of the Comp,-UlY to cOllsununatc the Purchase and the other transactions contemplated by

this Agreement nnll the VvTarrant and perform its obligations hereunder or Ihereunder on a timely

basis.

(h) "Previously Di.i'clo.l'cd" means inlDrmation set l()rth or incorporated in the

Company's Annual RepOlt on Form lO-K for the most recently completed fiscal year of the

Company filed \.\ith the Securities and Exchange Commission (the "SEC"") prior 10 the Signing

Date (the ;'Last Fiscal Year") or in its other reports and fonlls tiled with or furnished to the SEC

under Sections 13(a), 14(a) or 15(d) of the Securities Exchange Act of 1934 (the "r.\·change

Act") on or after the last day of the Last Fiscal Year and prior to tlle Signing Date.

2.2 Representations and Warranties of the Comp"illv. Except as Previously Disclosed,

the Company represents and Y\'arrants 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 Sig!lificant_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 o\-\'n its properties and

conduct its business in all material respects as 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 undcr the laws of each other jurisdiction in \Nhich it O\\'IlS or

leases properties or conducts any business so as to require such qualification; eaeh subsidiary of

the Company that is a "significant subsidiary" within the meaning of Rule I-02(\.\') 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. nlC Charter

and bylaws of the Company, copies of which have been pmvided to the Investor prior in the

Signing Date, arc truc, complete and correct copies of such documents as in full force and effect

as ofthe Signing Dale.

(h) Capit3li.Z<ltion. The authorized C<.1pita! stock of the Company, and the

nutf'tunding c'lpital stock oCthe Company (including secwities coIl\eriible l11tO, or excII..'isuhle or

exchangNlhk·fix. capital stock nf tlle C:omp.my) JS of die most rtcce-nt flsl',L! nW11l1l-<.:,nd

prt.'ccding the SJgning Dale (the "Capitaliz(.Irion Ddte") is set forth on S....;h\.'du~.JJ Tbt'

outsumding: shures of c~lpital stocK of tht: Cnmp,my Iw\ e 11ecn duty ,~ut11llriiea (md art:'- valid] y

iSSllt.':d and outstanding, fully paid and n(masst·::;~abJc.. ,Uld subject to nu rreempth.e rights (and

wJ:';r~ ntH i~su(:d inviohllj\H] of any 'pr('t~ll1pll\'(" rights). Exrepi a:.: provided in th~ Warrant, as l...~f

the Signing Dale, lite Company does rlC\t h~rve Qllt"t::Ul~Hng any .<;ecul'ities or other ohiig;tji(\tls

providing the hoJc~cr the right to acquire (\H':.1tncn Stock thaI is nol rl'st'f\'ed for i:::suaurc :1.')

~I)('tifi<:d no .s..t;.tJ~~~;~Jl~J), ;.u:d th..:: Compa:ly lws :l~A l:1.ade ;,Hiy otht::r CJl:uniUu..:'nl [0 ;~u:lH}:i/e,

j
issue or sell any COml11(ln Stock. Sin(;e the Capitalization Date, the Company has not issued any

shares of Common Stock, other than (i) shares issued upon the exercise of stock options or

delivered under other equity-based awards or other convertible securities or warrants \'vhich \vere

issued and outstanding on the Capitalization Date and disclosed on Schedule B ,md (ii) shutes

disdosed on .schedule I3.

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

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

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

of any preemptive rigllts, and \vill rank pari passu with or senior to all other series or classes of

Preferred Stock, whether or nol issued or outstanding, with resped to the pa)'lllent or dividends

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

Company.

(d) The Warrant and Warrant Shares.. The \Vanani has been duly authorized

and, when executed and delivered as contemplated hereby, will constitute a valid and legaJl)'

binding obligation of the Company enforceable against the Company in accordance Vfith its

temlS, except as the same may be Jimited by applicable bankruptcy, insolvency, rcorganization,

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 ("Bunkruptc)/ E"(;ceptions"). cl11C shares of COlrunon Stock issuable upon exercise

oflhe Warrant (the "JYarrant S'hares") have been duly authorized and reserved for issuance upon

exercise of the Warrant and when so issued in accordance with the terms of the Warrant v,rill be

validly issued, fully paid and non~asscssable, subject, if applicable, to the approvals of it'>

stockholders set forth on Schedule C.

(e) Authorization., Enforceability.

(i) The Company has the corporate power a.nd authority to execute

and deliver Ihis Agreement and the Warrant and, subject, if applicable, to the approvals

of its stockholders set forth on Schedule C, to carry out its obligations hereunder and

theretmder (which includes the issuance of the Pre1hrcd Shares, Warrant and Wan·ant

Shares). The execution, delivery and pcrfonnancc by the Company ofthis Agreement and

the V.lalTant and the consummation of the transactions contemplated hereby and thereby

haw been duly authorized by all necessary corporate action on the part of the Company

and its stockbolders, and no fUl1her approval or authorization i~ required on the part of

the Company, subject in each c,use, if applicable. to the approvals of its stockholders set

forth onS.!,:]Ie\.iul~C, I'his Agreement i~ a vulid and binding obligation of the Comp:my

enforceable ngains1. the Company in 3cconhnc-e \vitb jt~ tenlls, $ubject to tbe Btll1kmptcy

Excc~~lioll;':

Ui) The ('.\(Tution, delivt'ry and jX',rfi:tnmlrleC by jJle Cor:.lpany of IhiS

A,grcclllo,;;'nt and the \\"arralJt and the \.',Llilsunlluatlon ()f the tn,mt:act[(l!l$ cOllkmpJate1.1

ht'J\:hy imd thc:rehy ilnJ (omp!iance by th,-;; Comp~HlY withlhe provisions hc[C()f and

[h~lW.'C \viH n\.)[ 1/\) vi()la~c, l,,;(lHlh:t with, ()l result in <l hl'e~ldl of any provisi@ ot: (if

c;,:nsril~He ,J (kfauJi {or un est'nt ">vh;;ch; with ti.oti~',c Dr bps\.' (jf [iDIC (Ff l'Olh, 'NlmlJ
constitute a dehmlt) under, or result in the termination of, or accelerate the performance

required by, or result in a right or temlination or accckration ot: or result in the creation

of, any lien, security interest, charge or encumbrance upon any of the properties or assets

of the Company or any Company Subsidiary under any of the terms, conditions or

provisions of (i) subject if applicable, to the approvals of the Company's stockholders set

10rtll on Schedule C, its organizational documents or (ii) any nOle, bond. mortgage,

indenture, deed of trust licensc, lease, agreement or other instrument or obligation to

whid1 the Company or any Company Subsidiary is a paliy or by ,,,,,hicb it or any

Company Subsidiar:-' 1113y be bound, or to ,vhich the Company or any Company

Subsidiary or ,m)' of the properties or assets of the Company or any Company Subsidiary

may be subject or (B) subject to compliance with the statutes ,md regulations refetTed to

in the next paragraph, violate ally stlllute, rule or regulation or any judgment. ruling, order.

writ, injunction or decree applicable to thl: Company or any Company Subsidiary or any

of their respective propertie,s or assets except, in the case or clauses (A)(ii) and (I3), for

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

reasonably be expected to have a Company lvlaterial Adverse Effect.

(iii) Other than the filing of the Certificate of Desib'11ations ,,,,ith the

Secretary of State of its jurisdiction of organization or other applicable Govemmental

Entity, any cutTent report on Form 8-K required to be filed with the SEC, such filings and

approvals as are required to be made or obtained under any state "blue sky" laws, the

tiling of any proxy statement contemplated by Section 3.1 and such as have becn made or

obtained, no notice to, filing with, exemption or rcvicvI' by, or authorization, consent or

approval of, any Governmental Entity is required to bc 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 'VvouJd not, individuaJl;.' or in the aggregate, reasonably

be expected to have a Company Materia! Adverse ElTecL

(0 Anli-_takeoveUEn'isions and Rig.hts Plan, The Board of Directors of the

Company (the "Board qfDirectors'") has takcn all necessary action to ensure that the transactions

contemplated by this Agreement {lnd the \X/arrant and the consummation of the transactions

contemplated hereby and thereby, induding the exercise of the WmTant in accordance ,,,,ith its

t(.~nns, ""ill be exempt from any anti-takeover or similar pnwisiol1s of the Comp3ny's Charter and

byla\Ys, and any other provisions of any applicahle "moratorium", "control share", "fair price",

"tutercs1ed s!ockbold(;[" or other al1ti-takcov-er laws and regulations of J.llY jurisdiction, The

Company has tak....n all actions neccs~~try {o render any stockholders' rights plan of the Comp<:.lny

inapplicable \tl this Agreement ;md the 'Vamill! anJ the cOllsltInm<ltion of tile transactions

cOn1C'mpbtcd hefchy and thereby, Il1I.~Juding the, exercise of the \V<:tiTant by the JnVl~st()r in

acwrdance ;',.'ith its term;.:_

(g) ,~_t)_Cm.1.illany JllaJ£~Iic?L15:b'e.t;:;.f....WI~ij" SinGe the last day (If the last

(omplcred l:i::caJ ptTioJ ftlr \\hk,h th{.~ Company LiS Jikd a Quarterly R(;[1-oJ1 on Form IO-Q or an

Anr.m..! Report on Form lO-K \Villl lb,~ SEC pr~i:Jr fa the Si::;:lljng Date, no il~cL (irnUlltil<ul(X',

e'vcn~ change; occurreDtt\ condi~ion or d.;vL'iopml'nl has uC\,.'l:Ir~d thal, individwdly or ill !JIe

agg:re;iat~~, hit', h.:::d ('f \\.'o~dd rt:;ls{)nJbly he C,\r~'I..~:".·d :,0 hJ,,"c a C\nnp,-Hly Mater:a} A(lvcC"S(' E;Tect.

7
(h) Company Financi,11 Statements. Eaeh of the consolidated financial

statements of the Company Jnd its consolidated subsidiaries (co!lectiYely the "Company

Financial StateJ'/'wnts") included or incorporated by reference in the Company Report" filed wilh

the SEC since December 31, 2006, present fairly in all material respects the consolidated

financial position uf the Company and its consolidated subsidiaries as of the dates indicated

therein (or if amended prior to the Signing Date, as of the date of such amendment) and the

consolidated results of their operations for the periods specified therein; Rnd except as stated

therein. such financial statements (1\) were prepared in confonnity \....ith GMP applied on a

consistent basis (except as may be noted therein). (B) have been prepared from, and arc in

accordance with, the books and rcc()J"ds of the Company and the Company Subsidiari(;~s and (C)

complied as to fonn, as of their respective dales of filing \....ith lhe SEC, in all material resp~cts

-with the applicable accollnting requirements and \,yjth the published rules and regulations of the

SEC \\'ith respect thereto.

0) Reports.

(i) Since December 31, 2006, the Company and each subsidiary of the

Company (each a "Company Subsidim)!" and, collectively, the "Company

Subsidiaries") has timely tiled all reports, registrations, documents, filings.

statements and submissions, together \"lith any amendments thereto, that it was

required to fjle with any Govemmental Entity (the 1oregoing, 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 11aterial Adverse Effect.

As of their respective dates of filing, the Company Reports complied in all

material respects with all statutes and applicable rules and regulations of the

applicable Governmental Entities. In the case of each such Company Report filed

with or furnished to the SEC, such Company Report (A) did not, as of its date or

if amended prior to the Signing Date, as of the date of such amendment, contain

an untrue statement of a material tact or omit to state a material fact necessary in

order to make the statements made therein, in light of the circumstances under

which they were made. not misleading, and (B) complied as to form in all

matcna! respects with the applicable requirements of the Securities Act and the

Exchange Act. \Vith respect to all other Company Reports. the Company Rep011s

wt:re complete and <K'curate'- in all material respects as of their r~spt:ctive dates.

No executive officer of the Company or '-Iny Company Suhsj;,:liary has fuiled in

any respect to make the ct:rl'iticatioBs required of him or h~r under Section 302 or

906 of the Sarban('s~Oxley A<:,t of 2002.

(ii) The r~c-0rd':i, systems, (",ontrols, data and inl'i:mnarion of 111(;

Company cllJd the Cnmpan'Y Suh~idjaries me re<:,ordcd. sror~d, rnainulincd and

(lperatl'\l lmder m(",Uls (including ~my electrollJc, me,chanic~JI Qr photographic

pwce::.i:', \yh('th(~r C"omputcrizt'lcl or DOl) lh:''lt are und.;':"[ the eXL,lusi\'E' O\>,'neT5hip md

,lirc<-:t control (OJ!' th\; Cf'\l!1p:my (Ir the ('ompan~' Suhstdiarit" (IT 11:c.Jr ;'teCOl1ntDllts

(including ail mc;ms tJf ,KC(:S8 thcrdu :md tb:-;\.'fnml\ tXCtpt fm itn"\.' nO!ls
exclusive O\vnership and non-direct corttrol that would not reasonably be expected

to have a material uJversc eiTed on the system of internal accounting controls

described bck)\v in this Section 2.2(i)(ii), The Comp,my (A) has implemented and

maintains disclosure controls and procedures (as detined in Rule 13a~15(c) or the

Exchange 1\Ct) to ensure that material information relating to the Company,

including the consolidated Company Subsidimics, is made knO\vn to the chief

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

those entiiies, and (B) has disclosed, based on its most recent evaluation prior to

the Signing Date, to the Comp<my's outside auditors and the audit committee of

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

the design or operation of internal controls ovcr financial reporting (as defined in

Ruk, 13a-15(f) of the Exchange Act) that arc reasonably likely to adversely affect

thc Company's ability to record, process, summarize and report fimmcial

inJ(Jrmation and (y) any ii'aud, whether or not materiHL that involvcs management

or other employees who have a significant role in the Company's internal controls

over financial reporting,

(j) 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 bc so reflected or reserved against in accordance with GAAP,

except for (A) liabilities that have arisen since the last fiscal }'car end in the ordinary and usual

course of business and consistent with past practice and (B) liabilities that, individually or in the

aggregate, have not: had and would not reasonably be expected to have a Company Material

Adverse Effect.

(k) .oflt:ring of Securities. Neither the Company nor ally 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 Purchased Securities under the Securities Act, and the rules <mel regulations of the SEC

promulgated thereunder), which might sllbject the offering, issuance or sale of any of the

Purchased Securities to Investor pursuant to this Agreement to the registration requirements of

the Securities Act.

(I) Lit.igational1d Otl~r Proceedings. Except 0) as set 1'011h on Schedule D or

(ii) as \vould noI, individually or in the aggregate, reasonably be c.-..;pccrcd to have a Comp,my

Materia! Adverse Erkel, there is no (A) pending or, to the lnmvlcdgc of the C,ompany,

threatenr;::J, claim, a.ction, suit, investigation or pro-:c<:ding, again.,>t The Cornpany or an)'

Company Subsidiary \IT to which any or their asset,> Hre subject nor is the Company lJi" any

Cnmpany Subsidiary suhject to any order, judgmeHl or d~cri.:'<.;' or {B) unJ'esolveJ VIolation,

t..Titicism or ('XC'(:Ilti~m b\' an\' GPYcnlJnenta,1 Emity \\"jlh rCS!'lC'ct to ::tll\" l"l..',norl. or felat.ln!! 10 an)' . "' . . ....

e\am;nati(lll.~ or trlsp.;:..:,tions oflhe C(\1lJP2tny or any C.:m1;Ja1:'y Suhsidiaric::>,

{nIl r.Q!}JdhW~J':'_ ~\:)t!l._t~l\~~~... F)((:cpl as w,m]d noL individually ~)j' in the

<1ggrc~Htt, (~asnmjhly b.:- ("xp<::ckd tu h:l\'e ~'l Company Makrial ,\Jverse Ef1{',ct, the Cump,my

;md th(~ CUinl:',1nY Sub.!i\diarics hBVC all pemli:.'i, Itt:cnse~. fnjm:,hist~,j, authorizmi,.-ms, urJ,.:;;l's ,md
approvals oC and have made all filings, applications and registrations \vith, G-ovcrnmcntal

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

10 cmry 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 hcn'c complied in all respects and arc not in dt'1;wlt or violation ot and

nOlle ofthc111 is, to the knowledge ofth" Company. under investigation with respect to or, to the

knO\vlcdge of the Company, ha\\': been lhrcatened to be charged \vith or given notice of any

violation of, any applicable domestic (federaL stale or local) or f()f(:ign law, statute, ordinance.

license, rule, regulation, policy or guideline, onler. demand. writ, injunction, decree or judgment

of any Governmental Entity, other than such noncompliance, dci~lU!tS or violations that would

not, individually or in the aggregate, rc.a."ionahly be expected to have a Company Material

Adverse Effect. Except f(Jr statutory or regulatory restrictions of general application or as set

forth on Schedule- I~, no Governmental Entity has placed any restriction on the business or

propcliies of the Company or any Company Subsidiury that would, individuaHy or in the

aggregate, rea<;onably be expected to have a Company Material Adverse Effecl.

(n) ~mployee Bellefit Matters. Except as \v()llld not reasonably be expected to

have, either individually or in the aggregate, a Company Material A..dverse Effect: (A) 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 \vithin the

me,ming of Section 414 of the Intemal Revenue Code of 1986, as amended (the "Code")) that is

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

and for which the Company or any member of its Controlled Group \vould have any liability,

whether actual or contingent (each, a "Plan") has been maintained in compliance \vith its terms

and \\~th the requirements of all applicable statutes, rules and regulations, including ERlSA and

the Code; (B) VI'ith respect to each Plan subject to Title IV of ERISA (including, for purposes of

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

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

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

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

\vaivcd, has occurred in the three years prior to the Sih'1ung Date or is reasonably expected to

occur, (2) no "accumulated funding dC'ficiency" (within the meaning of Section 302 of ERISA or

Section 412 of the Code), whether or not ~vaivcd, has occurred in the three years prior to tbe

Signing Date or is rcasomilily expected to OC-':Uf, (3) the ['til' market value of the assets under

C8ch Plan exceeds the present value of all benefits aC('.l11cd under slich Plan (determined based on

lhe ,Issumptions u:>e:d to fund such Plan') and (4) neither the Company nor an.v mcmb\'f of it~

Controlled Group has incurred in the six ycar~ priN 10 the Signmg D3tc, or rcasonab!~r expects to

im;ur, any liability underT'itle IV of FRISA (t,th('r than (.l'I1(ribution~ tn the Plall or premillllls lO

tll!:'. PBGC in the ordjn~i1'Y t:ourse and without dcfilUlt) ill resp~ct of a Plan (1t1chdil1g any P!,Ul

that is a "'mu]tiemp[oycf phm", wrlhin the mCtUling of Sectinn .f001(c)jJ) of UnSAy; and (c)

t:<lch Plan lhat i~ intended to be qUJ!iilcd under ScctiOCl 40l(a) oi" dIG Cod\;' ba:o. received a

favorahk', dl.:'tt':111ination !ctt('f fnHD Inc IBh'rn;ll He\(cmK' S',::n.-keIVHh re~rcct tn i:-s qualiiid

st,HlL"i that ha::- nN becn rcvnk-::Jr (fl' ~m;h a dekrminati'!ll leltt'r bas OCt'll timely applied for but

noi )x;'Z:civc,d hy lh~ Sigaing J);,:(,::', ;~nd iJr>lhint'; hilS <x:euned. wf-,'c~thcr by (~-2j,J'1 or b,'{ ri:lilure tt)

10
act, which could reasonably be expected to cause the loss, revocation or denial of such qualified

status or faw)u:lhlc 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

Suhsidiaries have filed an federal, state, local and foreign income .md franchise Tax rchlms

required to be filed through the Sib'111ng Date. subj..:.d to permitted ~xtcl1sion.s, and have paid all

Taxes due thereon, and (ii) 110 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. "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 \ulorem, transfer or excise tax, or any other tax, custom, duty,

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

interest or penalty, imposed by any Govcmmental Entity,

(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 al! other

properties and assets om1cd by them, in each case free from liens, encumbrances, claims and

defects that would affect the value thereof or interfere \vith the usc made or to be made thereof

by them. Except as \\'ould 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

rca! or personal property under valid and enforceable leases with no exceptions that w'Quid

interfere v.ith the use made or to be made thereof by them.

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

aggregate, reasonably be expected 10 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 vvould 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. induding the Comprehensiye

Enyironmental 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 reasonahle basis fl.)!" any

such proct'eding, claim or action: and

(iii) neither lite Company nor any Cumpany Subsidiary lS 8lJbjcc.:t to

any {~grecm(';nt, ord~l'. judgment Of decree by orwilh any C0urL (Jri'C"rnmcntal Entity or

t}1ird rarry impnsing any su",h enyiromnentalli3bilily.

(r) JiA8..lS.11ili){!g§mt.:eIJ.Upt:rH1m.'-J1J.5. Except H~ wpuld BtH, individu:lllyor in the

,lggrcg<lk', n.:";l~(\nabj) be eXJ".::ctcd to hav~ ;;l Comp:my Mtltl.:"T\'ll A(:ver::e EfftTt., all deri.\'alJV~

instnurH:,llts, mduJ1ug, swaps, C:,lP,~" t10urs (In.d l.lplItlll agl"<..'~lm:Ill<;' whether ent.::.'n.,d (lilt, f'(:Jr 1:['11:

I )
Company's own account, or [or the account of one or more of the Comp,my SUbsldiaries or its or

their customers, were entered into (iJ only in the ordinary COurse of business, (ii) in acconJmlcc

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

regulatory policies and (iii) with counterpartics believed to be Jinancially responsible at the time;

and each of such instruments constitutes the valid and legally binding obligation of the Company

or nne of the Company Suhsidiaries, enforceable in acconlance with its terms, except as may be

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

to the knO\Cvledge of the Company. any otber party thereto, is in breach of any of its obligations

under any sucb agreement or arrangCn1L'_nt olher than such hreaches that \\'ou1d not, indi-vidually

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

(s) Agreements \'¥'it.h_Rcgulatorv Agencies. Except as set forth on B-~hed[]lc F,

neither the Company nor any Company Subsidiary is subject to any material cease~and~desist or

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

agreement, consent agreement or memonmdum of understanding v.'ith, 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 (other than the Appropriate Federal Banking Agencies with jurisdiction over the Company

and the Company Subsidiaries) that currently restricts in any material respect the conduct of its

business or that in any muterial manner relates to its capital adequacy, its liquidity and funding

policies and practices, its ability to pay' dividends, its credit, risk management or compliance

policies or procedures, its internal controls, its management or its operations or business (each

item in this sentence, a "Regulatory AKreement"), 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 arc in compliance in all material respects \-vith each

Regulatory Agreement to which it is party or subject, and neither the Company nor any

Company Subsidiary has received (lily notice fiom ally Govenunental Entity indicating that

either the Company or any Company Subsidiary is not in compliance in all material respects \\,;th

any such Regulatory Agreement. "Appropriate Federal Banking Agency" means the

"appropriate Federal banking agenc,Y" \\ith respect to the Company or such Company

Subsidiaries, as applicable, as defined in Section 3(q) or the federal Deposit lnsurance Act (12

1I.S.c. Section 1813(q).

(0 lnsurance. The Company and the Company Subsidianes arc inStlred with

repumble insurers <lgaimt such risks and in such amounts as the management of the Company

reasonably has dt,termined to be prudenl llnd consistent with indu'Itry practice. The COmpall)'

and the Company Subsidiaries are U1 material compJi8nec \vith their insuram:e pulicies and arc

not in default 1111d~r ,my nftllc material te-rms thereof, each such poli..:y is outstanding and ill full

force and cfJccL JH prt:mium", and {lth<;,l' payments due Lmder ,my malL~ntlJ pollcy klVC been paid,

and all claims 111ereunder lIa'.'<': bO;:I::11 tiled in due aId 1JmeIy hlshion, (\XC<;f:l, in clli,.'h CIl!'e, :otS

\""~'uld nol, indlviduall.\ or in the. aggl'c&a!C, n::,\sunably be ("xpt'Ckd to hah; a C0mpany!\-1aterial

!\d'v'~rse Eileer.

(Ul Ifl..!~J.l.~£tllit!, P::'Q.f1t:I!.Y. Ex\::ep\ as would nOl, illdi,idw.'lJJy (If in the ag-glcgate,

n.'ilsona:1 !y be (~.xpected to havt: <1 CempcUly !'-.-1atcri,;d Ad'\',"Tse Ltl~:";i, (1) tnt' CmlpilD)' and t:'Hch

12
Company Subsidiary owns or otherwise. has the right to usc, all intellectual property rights,

including all trademarks, trade are,55, trade names, sefviC"c mm·ks, 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 fights relating to the plans, design and

specifications of any of its branch facilities ("ProprietafJ' RighfS') free and clear of all liens and

any claims of o\YTIership by cum:nt or rOnnef employees, conlractnfS, designers or others ,md (ii)

neither the Company nor any of thlC Company Subsidiaries is materially infringing, diluting,

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

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

thcm has materially infringed, diluted, misappropriated or violated, any of the Proprietary Rights

owned by any other person. Except as would not, individually or in the aggreg<:lte, rca.sonably be

expected to have a Company :t\latcrial Adverse EfTect, to the Comp,my's Imo'Vv1cdge, no other

person is illhinging, diluting.. misappropriating or violating, nor ha..,> the Company or any or the

Company Subsidiaries sent any ,vritlcn communications since January J, 2006 alleging that any

person has infringed, diluted, misappropriated or violaled, any of the Proprietary Rights owned

by the Company and the Company Subsidiaries.

(v) Brokers and Finders. No broker, findcr or investment banker is entitled to

any financial advisory, brokerage, finder's or other fee or commission in connection with this

Agreement or the Warrant or the transactions contemplated hereby or thereby based upon

arrangements made by or on behalf of the Company or any Company Subsidiary for which the

Investor could have any liability.

Article III

Covenants

3.1 Commercially Reasonable Efforts.

(a) Subject to the terms and conditions of this Agreement, each of the parties

will use its cOl1unercially reasonable e1forts in good faith to take, or cause to be taken, all actions.

and to do, or came to be done, all things necessary, proper or desirable, or advisable under

applicable laws, so as to permit consummation of the Purchase as promptly a.s practicable and

otherwise to enable consummation of ihe transactions contemplated hereby and shall use

commercially reasonable efforts to cooperate ,vith the other pruty to that end.

(b) If the Company is required to obtain any stockholder approvals ,Set fUfth

on Scht;;'dille C, then the C'ompan)' shall comply with this Section 3.1 (h) and Section 3.1k), The

CompallY shaH call a -"pecial mc-eting, of its stockholders, a.., promptly as practicable folJO\Ning

the Clo:-ing, to vole on propos<lls (collectively, the ",)'toddlOldt'f PrO{'05a{s"O/ to (1) approve the

cxercl:-;"': (If the Warrant it.lr Common SUlck 1(Jf rurpi..\~,e,'l of th~ rules of [hL' ll.:1til)11'11 securit.v

t~XckUlge on \vhich the Common St{,ck i~ listed amL'or (ii) ame,nd the Cmnpany's Ch<J.rter to

incft:a.st' th(t nu,nhcr of :uJthnri7.(',d slwre~ d' Common Stock to at k,L~t su('".h numher as shall be

sufDcit;;ut to permit the fuJI exercise of the Warrant. ti)r Comm(.'!1 Stock :JllJ COIlTply with the

oth('.J' provi::iol1s of thii< S~ction 3.J(b} :md Si.',ctinn 1.1(,,). The H,)afd clf Din..'t.tor.'l shaH

rccommcn,l 10 Ihl' Cn1:rpany'", stockl1C'!d~T':; lhm such :;t{)i..~kltolders ,"'ote il~hn'N of th.:~

StL,(~klltlldt'rProp()sa13.In C{'llrledion wi.th sur-h tlhx'.(ing, ih.:: Compauy .~h<lt ;Jr":-J.>r-:\:l''.:: ("md thi,.'
Investor will reasonahly cooperate \vith the Compony to prepare) and file ·with the SEC ~L"

promptly as practicable (but in no event more than ten business days after tht: Closing) a

preliminary proxy statement shall use its reasonable best elTort.s to respond to any comments of

the SEC or its stalf thereon and to cause a dellnitjve proxy statement related to such

stockholders' meeting to be mailed to the Company's stockholders not more than five business

days after clearance thereof by the SEC, and shall USl: its reasonable best effOlis to solicit proxies

for such stockholder approval ur the Stockholder Proposals. The Compuny shaH noti!)' the

Investor promptly of the receipt of any comments from the SEC O[ its staiT "vith respect to the

proxy statement and of any request by the SEC or its staff for muendments or supplements to

such proxy statement or for additional infoDnation and \vill supply the Investor with copies of all

correspondence beh·veen the Company or any of its representatives. on the one hand, and the

SEC or its stan: on the other hand, with respect to such proxy statement. If at any time prior to

such stockholders' meeting there shall occur any event that is required to he sct !r.llth in 3n

amendment or supplement to the proxy statement, the Company shall as promptly as practicable

prepare and mail to its stockholders such an amcndment or supplcment. Each of the Investor and

the Compa.ny agrees promptly to correct any information provided by it or on its behalf for use in

the proxy statement if and to the extent that such information shall have become false or

misleading in any material respect, and the Company shall as promptly as practicable prepare

and mail to its stockholders an ffillcndment or supplement. to correct such information to the

extent required by applicable laws and regulations. The Company shall consult with the Investor

prior to filing any proxy statement. or any amendment or supplement thereto, and provide the

Investor \v:ith a reasonable opportlmity to comment thereon. In the event that the approval of any

of the Stockholder Proposals is not obtained at such special stockholders meeting, the Company

shall inclUde a proposal to approve (and the Board of Directors shall recommend approval of)

each such proposal at a meeting of its stockholders no less than once in each subsequent. six~

month period hcginning on January 1.2009 until all such approvals urc obtained or made.

(c) None of the infonnation supplied by the Company or any of the Company

Subsidiaric::i for inclusion in any proxy statement in cormcction with an)' such stockholders

meeting of the Company will, at the date it is filed with the SEC, when first mailed to the

Company's stockholders and at the time of any stockholders meet:ing, and at the time of any

amendment or supplement thereot contain any unlrue srntClTIcnt of a material fact or omit to

stale any material fact necessary in order to make the statements therein, in light of the

r..:ir~'llmstancc,s under \vhich they arc rnad<:, not misleading.

3 :: EXJ:.lens~l':. Unless otherwise pronded in this Ag.rcem\'nt nr the 'J.,.'ammt each of

the partit's hereto will bear and pay all c.osts and exp('ns('s incurred by it or 011 it" hehalf in

connection \,,·itb (he transac,tium Cl..mtt.~mplated under this Ag:n,",~t1lent and tb~~ Warrant including

t(~CS and CXpt~ns¢s of its OVI'11 fitlanl'i~l! I)f oth"l" ((\n~uJta1l1s. inveslnwnl hanh'Ts, UCc.()llntdm~ and

cO\'\!l;:;cl.

(a} During fIR' p{.~riod fnm1 tlJe C!('sing Dale (DC if tile approval of tht:

Sw<:k1!older p~(\p\J~i;lls is requirt.'dc tJl~ dare ofsucb appm\"al) until the date on which tbt·; \Varrdnt

k1\ b~'(;n fully aerc\"il:-U, the (\~mpm1:. sha~: a~ ,,,:1 time;; have f'l'.':"erved tell i::;su"illr~~, fr(Ce ()f

14
preemptiw or similar rights, a sufticient number of authorized and unissued V{arrant Shares to

effectuate such exercise, Kothing in this Section 3.3 shaH prccllldc the Company from satisfying

its ohligations in respect of the exercise of the \Varrant hy delivery of shares of Common Stock

which arc held in the treasury of the COrnpall)'. As soon as reasonably practicable [{)llov,cing the

Closing, ihe Company shall, at its expense, Gause the V\i'ammt Shares to be listed on the same

national securities exchange on which the Common St.ocK is listed, sul:iccl to (l!llci..ll notice of

issuance, and shall maintain such listing for so long as any Common Stock is listed on such

exchange.

(b) If requested by Ule Investor. rhe Company shall promptly use its

reasonabte best efforts 10 cause the Preferred Shares to be, appro\'cd for listing on a national

securities exch;mgc as promptly as practicable following such request.

3.4 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 \vhich it is

aware and which would reasonably be expected to ('<-luse any representation or warranty of the

Compan:y cont.1.ined in this Agreement to be untrue or inaccurate in any material respect or to

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

complied \vith or satisfied in any material respect and (ii) except as Previously Disclosed, any

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

is a\vare and which, individually or in the aggregate, has had or would reasonably be expected to

have a Company Material Adverse EHect; provided, however, that delivery of any notice

pursuant to this Section 3.4 shall not limit or atfect any rights of or remedies available to the

Investor; provided, fifr/her, that a failure to comply with this Section 3.4 shall not constitute a

breach of this Agreement or the failure of any condition set forth in Section 1.2 to be satisfied

unless the underlying Company i\'1atcrial Adverse Efted or material breach would independently

result in the failure of a condition set forth in Section 1.2 to be satisfied.

3.5 Access, Information and Confldentiatitv.

(a) From the Signing Date until the date when the Investor holds an amount of

Preferred Shares having an aggregate liquidalion value of less than lO'J~1 of the Purchase Price,

the Company v:."iIl permit the [nvestor fmd its agents, cDllsuliants, contractors and advisors (x)

acting through the Appropriate Federal Banking Agency, to examine the c.orpofHte books and

make copks thcr('ol' and to discuss the af1~ljfs. fil1aJ1Ces and accounts of the Company and the

Comp;:my Subsidi:lric$ with tbl:' princip:ll officers oftnc Company, all upon reasonable notice and

at such re,a~{)nnble tim..::s ,md as often as the Investor may rcasol1':1bly rr;;ques{ and (y) to review

any jnfonno:tlion material to the InvestPT'S investment in [he Company pro\'ided by the Campl.Uly

h1 its Appropriate Federal Banking Agelwy. Any investigatioll pur.<:.uant ttl this Sec,tion 3.5 shall

he conductcd during normal husiJ1GSS hours and in :iTICh manner 3S not tn intGJ'fcrc unreasonably

with tIll!: condUd of th.: businc::;s of the Ccm;p:my, and nothing herein shall require the Cempany

or <illY Compi'lny Suhsidiary to Ji:'iclosc any In[orm,ltio:1 h\ the Investor ttl the extent (i)

pn.'hibi:eJ by appli<.:<Jblt' law or regulation, or I.ii) th1:lf $Udl disd(lSllre \I.'HaJd rea'i,mubly bc

.;xpc(:wd w c<ms~ a \'loL.\rion Lif .my agrt't.'J'llen1 to wh,'h the Comp;;Hly ()r an:" Comp,my

Suh:"id:ary i.\ ,J p;,uty ('J' would ';;J(L."~ il fi$k (If a 1055 of l'r1vik~,~: ((I th(' Ci,mpiUly or any O'mpany

Suh.~idiary (pro",'dt'l.! ttM! (1If' CIJI~pan:" :;t:~jil use c{)rl.1:m.:~ti~tny r~''.ls(fnClblc dl{:<!'($ to make:

15
appropriate substitute disclosure ammgcmcnts under circumstances where the restrictions in this

clause (ii) apply).

(b) ]11c Investor \vill use reasonable best efforts to hold, and wiU use

reasonable best efforts to cause its agents, consultants, contractors ilnd advisors 10 hold. in

confidence all non-puhlic records, books, contracts, instruments, compul~r dara and other data

and inl()mHltion (collcctiYely, "!I?j(mnation") conc.crning the Company furnished or made

available to it by the Company or its representatives pursuant to this Agreement (e~cept to the

extent that such infonnation can be shO\m to bave heen (i) previously known by such party on a

non~confidential basis, (ii) in the public domain through no fault of such party or (iii) Inter

lawfully acquired from other sources by the party 10 which it \-vas furnished (and without

violation of ,my other confidentiality ohligarion); provided that nothing herein shall prevent the

Investor from di,scIosing any Infom1ation to the cxtcnt required hy applicable laws Of regulations

or by any subpoena or similar legal process.

Article IV

Additional Agreements

4.1 Purchase for Investment. TIle Investor acknowledges that the Purchased Securities

and the Warrant Shares have not been registered under the Securities Act or tmder any state

securities laws. The Investor (a) is acquiring the Purchased Securities 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 of the Securities Act or any applicable u.s. state

securities 13\"'s, (b) will not sell or othcnvise dispose of any of the Purchased Securities or the

Warrant 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 lmmvledge

and experience in financial and business matters and in investments of this type thal it is capable

of evaluating the merits and risks of the Purchase and of making an informed investment

decision.

(a) The Investor agrees that aJi certificates or other instruments representing

the \Varrant and the Warrant Shares will bear a legend substantially to the follo"V,-ing effect:

'THE SECURITIES REl'RESE'iTED BY TInS INSTRCMENT HAVE NOT

BEEN REGISTERED UNDER THE SECIJRITIES ACT OF 1933, AS

AME1\DED, OR THE SFCURlTIES LAWS OF ANY STATE AND MAY NOT

BE TRANSFERJU'D, SOLD OR OTHERWISE DJSPOSED OF EXCCPT

\\lnLE A REOlSTRATlON STA'JTMENT RELATING THERETO IS IN

EFFECT t'NI1ER SUCH ,\LT AND APPLICABLE STAn' SECC'RtnES

LAWS OR PW<SUANT TO ,\N EXLMPIlO;'; FROM REGISTRATION

FNI1ER SUCH ACT OR SUCH LAWS,"

On The hn·t~~rl1T <lg..rc('$ th,n i·dJ cendi':l:lh.\<; (If lJthcr Jl:,su-tnn-:ni.s representing

lh~; W;;~r"'i:lnJ wD! ctlso b"~vr :1 kgend sl1bst;~ntial1yto the ti:Jll"Ywing d'f<-'t"l:

16
"THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON

TRANSFER AND OTHER PROVISIONS OF A SECUIUTIES PURCHASE

AGREEMENT BFPIiEEN THE ISSUER OF THESE SECURITIES AND THE

INVESTOR REfERRED TO THEREIN, A COPY OF WHICH IS ON FILE

WITH THE ISSl:ER. THE SECURlTlES REPRESENTED BY TillS

INSTRUMENT MAY NOT BE SOLD OR OTHERWISF TRANSFERRED

EXCEPT IN COMPLIANCE WITH SAlIl AGREEMENT. ANY SALE OR

OTlIER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT

WILL BE VOID."

(c) In addition. the Investor agrees that all certificales or other instruments

representing the Preferred Shares \vill bear a legend substantially to the (ollov.,.'ing effect:

"THE SECURJTlES REPRESENTED BY THIS INSTRUMFNT ARE NOT

SAVINGS ACCOUNTS, DEPOSITS OR OTI IER OllLlGATIONS OF A BANK

AND ARE NOT INSURED BY THE FEDERAL DEPOSIT FNSURANCE

CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.

THE SECURITIES REPRESENTED BY THIS FNSTRUMEl'T HAVE NOT

BEEN REGISTERED UNDER THE SECURJTIES ACT OF 1933, AS

AMENDED (THE "SECURITIES AC1"'), OR THE SECURITIES LAWS OF

ANY STATE Al'D 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 SECURJTIES REPRESENTED BY TIllS

INSTRUMENT IS NOTIFIED THAT THE SELLER MAY BE RELYING ON

THE EXEMPTION FROM SECTION 5 OF THE SECURrTIES ACT

PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF THE

SECljRJTIES REPRESENTED BY TlIIS INSTRUMENT BY fTS

ACCEPTANCE HEREOF (I) REPRESENTS THAT IT IS A "QUALIFIED

INSTITUTIONAL BUYER"' (AS DEFINED IN RULE 144A UNDER THE

SECUIU fIES ACT), (1) AGRFES THAT IT WILL NOT OFFER, SELL OR

OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY TITIS

INSTRUMENr EXCEPT IA) PURSUANT TO A REGISTRAIJON

STAIEMFNT WHICH IS THEN EFFECTIVE UNDER THE SECURITIES

ACT, (II; FOR SO LONU AS THE SECURITIES l{['PRESENTED 11 Y THIS

It\STRUMENT ,IRE ELiGiBLE FOR HESALE PI iRSU,INT l'O RULE 14440.,

TO A PERSON IT REASONABLY BELIEVES J,S A "QIIALlEIED

INSTITUTION,IE BCYER" AS DEFINEr) IN RULE 144A ('NDER THE

SECURITIES ACT THAi' PURCHASES FOR ITS OW"" ACCOeNT OR FO!(

rilE ACCOUNT OF A QUAliFIED INSTIH'TIONAL BUYER TO WHm1

NOTICE IS GIVE>! TIIAT rUE TRANSFER IS BEING MAnE 1:-; RELlM;CE

0;'; RULE 144i1, (0 TO TllE ISSUI:J( OR W) PURSUANT TO ANY OTHER

17
AVAILABLE EXEMPTION FROM THF REGISTRATION REQUIREMENTS

OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO

EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY TlilS

INSTRUMENT ARE TRANSFERRED 1\ NOTICE SUBSTANTIALLY TO

TilE FFFFCT OF THIS LEGEND."

(J) In the event that any Purchased Securities or Warrant Shares (i) become

registered under the Securities Act or (ii) arc eligible to be transfclTcd without festliction in

accordance \\/ith Rule 144 or another exemption li01u registratiun under the Securities Act (other

than Rule 144A), 1he Company shall issue new ccrtificutcs or other instruments representing

such Purchased Securities or WanaBt Shart's, which shall not contain the applicable legends in

Sections 4.2(a) and (c) above; provided that the fl1vestor surrenders to the Company the

previously isslled certilicates or other instruments. Upon Transfer of all or a portion of the

Warrant in compliance with Section 4.4, the Company shaH issue new certificates or other

instruments representing the WarranL \vhich shall not contain the applicable legend in Section

4.2(b) above; provided that the Investor surrenders to the Company the previously issued

certificates or other instruments.

4.3 Certain Transactions. The Company will not mcrge or consolidate with, or sell,

transfer or Iea.'.:;e all or substantially all of its property or assets 10, an}' 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 pWlClual performance and ohservance of each and

every covenant, agreement and condition of this Agreement to be pert()mlcd and observed by the

Company.

4.4 Transfer of Purchased Securities and WalTant Shares; Reslri<;tions on Exercise of

the Warrant. Subject to compliance with applicable securities laws, the Investor shall be

permitted to transfer, sell, assign or othcnvise dispose of ("Transfer'') all or a portion of the

Purchased Securities or Vlarrant Shares at any time, and the Company shall take all steps as may

be reasonably reque::;te.d by the Investor to facilitate the Transfer of the Purcha-<;cd Securities and

the V/arrant Shares; provided that the Investor shall not Transfer a portion or portions of the

\Varrant with respect to, and/or exercise thl;; Warrant for, morc than onc·half of the Initial

Warrant Shares (as such number may be adjusted from time to time purswmt to Section 13

thereoO in the aggregak until the earlier of (a) the date on which the Company (or any successor

hy Businc.'ss Combination) has rccl:::i\"cd aggreg<lle gross proceeds of not 1e,$S than the Purchase

Price (and the pHrcha~c pri,;e paid hy the Jm'..-:stor to any such successor for securities of such

successor purcklsed under the CPi» from om_~ or more Qualitid Equity Otfeling~; (including

Qualified Equity OJT..:rings of such successor} and (h) December 31, 2009. "Qua/Uied Equity

(Yli'rirrg" mcao.s the Sdle :Jnd issuance li)f c;l:ih by tJlI:.~ c.Jmp,my to persons other than the

Company or any of the Company Sl1he,:1di~lfies aftL~r tht~ Closing Date of sh:Jrcs or perpetual

Preferred Sto..:::k, Common S-to,-:k ur a.ny cmnb:ualt()11 uf ::;lK~h sh)ck, that, in each OBt:, qn:1..lil)' tlS

<lnd rna)' he inl."luJed in Tler 1 capit:jJ or the CrllllJ!,JllY at lh,-' tim" of iSSLlaTKC lmdc-;' tile

appliC<lhk risk-h:!scd capit.al gt]ideiim.~:.: of the Compml)'·::; Api"\rorrl:lt<:: Fedefn! rhnking AgCl:C}

(\.)ther tlmn any $uch saks a:ld issuances made pUf:;uanl to :-lgr~emer:t$ ("If :trrJl1gem,;-nis entered

inH', or .rurS"tJlJllt to .t1jH'mcmg ptans whkh \\'CI"I: publicly ~mlh)Hn-eed, on or ]"\l1ur lo O~lobt'r U,

18
2008), "Business Combination" means a merger, consolidation, statutory share exchange or

similar transaction that requires the approval ofthe Comp;:UlY's stockholders.

(a) Registratiun.

(i) Subject to the terms and conditions of this Agreement the Comp3ny

covenants and agrees thut as promptly as practicable alier the Closing Date (and in any

event no later than 30 days ailer the Closing Date). the Company shall prepare and file

with the SEC a Shelf Registration Statement covering all Registrahle Securities (or

otherwise designate 1m existing Shelf Registration Statement tiled v,'ith the SEC 10 cover

the Registrable Securities), and. to the extent the Shelf Regisuation Statement has not

theretofore been declared et1ecti\'c or is not automatically effective upon such filing, the

Company shall usc reasonable best etTorts to cause such Shelf Registration Statement to

be declared or become effective and to keep such Sbclf Registration Statement

continuously efIective and in compliance \vith the Securities Act and usable [or resale of

such Registrable Securities for a period from the date of its initial effectiveness until such

time as then: are no Registrable Securities remaining (including by fefiling such Shelf

Registration Statement (or a new Shelf Registration Statemenl) if the initial Shelf

Registration Statement expires). So long as the Company is a well-known seasoned

issuer (as defined in Rule 405 under the Securities Act) at the time of tiling of the Shelf

Registration Statement with the SEC, such Shelf Registration Statement shall be

designated by the Comp,my as an automatic Shelf Registration Statement.

NotVi'ithstanding the foregoing, if on the Signing Date the Company is not eligible to file

a registration statement on Fonn 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.

(Ii) Any registration pursuant to Section 4.5(a)(i) shall be effected by means of

a shelf regisu"ation on ,ill appropriate 10nn under Rule 4 J5 under the Securities Act (a

'\\'11('(1" Regisiration Sfafeme/lt"). If the Inveslor or any other Holder intends to distribute

any Registrahle Securities hy means of '-ill undcf\vrittcll offering it shall promptly so

advise the Company tUld the Company slmll tllke all reasonable steps to facilitate sucb

distribution, including the Hctions required pursuant to Section 4.5(c); fJ"rovided that the

Company shall not be requirL'd to facilitate an undcnvritten offering of Registrable

Securities unless the expected gross proceL~ds irom such offering exceed (i) 21;,";.1 of the

initial aggregate liquidation preference of the Prderred Shares jf sUi.:h initial aggrC,gate

liquidation preference is less \h~m $2 billion and (ii) $200 millil111 if the mitial aggregatl:'

liquidati011 prefert:nce of the Pretencd Shares is equal to or greater tkm $1 hilli\.lD. T1Je

lead underwTitl.:rs in un! such distrihutit'll shall be "elected by the Holders of a majority

of the Registrahle Securities- to h(~ d~Sirlbllt('d: provided thai 10 the r.::Xtt'nl appmpriat...:: and

pennJ.ttcd under .TppJicnhie lllw, su~h Holders Shkllt cGnsidcr the qUiJ,li!1cations of any

brl)keNk.alt'T Allili,1tC' of the Compdil)' in seIeding the lead nnderwritt'[s in <'UI)' such

dist6b-ution,

1~}
(iii) The Company shall not be required to effect a fe-gistration (including a

resale of Registrahle Securities hom un elJecti"ve Shelf Registration Statement) or an

tmdenvTitten offering pursuant to Section 4.5(a); (A) with respect to securities that are

not Registrable Securities; or (13) if the Company has notified the Investor and all other

Holders that in the good faith judgment of the Board of Directors, it l,.vould be materially

detrimental to the Company 01· its sccurityholders for such rcgislTatiol1 or underwritten

offering to he effected at such time, in which event the Company shall have the right to

defer such registration for:) period of not more than 45 days after receipt ofthe request of

the Investor or any other Holder; provided that such right to delay a registration or

underwritten ofJi:l'ing shall be exercis~J by the Company (1) only if the Company has

generally exercised (or is concurrently exercising) similar bJack·out rights against holders

of similar securities that have registration rights and (2) not more than three times in any

12~month period and 110t more than 90 days in the aggregate in any 12-month period.

(ivl If during any period when an effective Shelf Registration Statement is not

available, the Company proposes to register any of its equity securities. other than a

registration pursuant to Section 4.5(a)(i) or a Special Registration, and the registration

foml to be filed may be used for the registration or qualiJication for distribution of

Registrable Securities, the Company \vill give prompt \vriltcn notice to the Investor and

all other Holders of its 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 \vithin ten business days after the date of the Company's notice (a

"Piggvhack Regis/ration''). Any such person that has made such a l,.vritten request may

withdraw its Registrable Securities from such Piggyback Registration by giving \\Tittcn

notice to the Company and the managing undef\.vriter, if any, on or before the fifth

business day prior to the planned effective date of such Piggyback Registration. The

Company may tenninatc or withdraw any registration under this Section 4.5(a)(iv) prior

to the effectiveness of such registration, whether or not Investor or any other Holders

have etected to include Registrable Securities in such registration.

(v) if the registration refened to in Sec1ion 4.5(a)(iv) is proposed to be

underwritten, the Company \.vill so adyise Investor and all other Holders as a part of the

'''Titten notice given pursu2nt to Section 4.S(a)(iv). In such event, the right of Investor

and all otllcr Holder;.; ((I regislration rursu.Ll.nt to Section 4.5(a) will be conditioned upon

such persons' participation in such undcnvriting and the inclusion or such person's

Rl.'gistrable Securities in thc underwriting if such se~urities are of the same class of

sc(untjc.~ a.s thl.' secmilies to he offered in th~ undcf\yritten offering, and t:ucll stich

person will (t(lgedwr with tht' C\..H1Jpany and lh~ olher persons distributing their securities

through such tnldcnvnting) enter into em lUlderwritlng agn..'ernl.?nr in customary form wit11

the unden'JI'j!·a or undcnvritcl'5 s~,!eckd fur sUi:h nndcr"\vriling by the CompkU1y; pl"Ol'idvd

that th~ J.nve.'>{o[ \.:.15 opppsed to 01.11<.:1' Holders) shall not be required to indemnify any

person in connectiCln with any n.~gistra~lOl1, If illly p<.irticipating person disappnwcs of t.he

terrns oftbe und0fTNrijmg, ,~udlll{'r5i)Jl nwy elect to \\jL'1dn\\\' there-from by written notli;.',C

ll) the, c,.lmpany, lh,: fll<Ut,lgmg llnd\,;nvritss ami tht'" [m':.::stm tif til::'. lu\'csi,Jr i;;

t:'artkip3t'ing In th<.: lmderwri:ing).

20
(vi) If either (x) the Company grants "piggyback" registration rights to one or

more third parties to include their securities in an underwritten oHering unuer the Shelf

Registration Statement pursuant to Section 4.5(a)(ii) or (y) a Piggyback Rc:gistratioll

under Section 4.5(a)(iv) rdates to an underwritten offering on behalf of the Company,

and in either case the managing undcf\\Titcrs advise the Company' that in their reasonable

opinion the number of securities requested to he included in such offering exceeds the

number \\-hich can be sold \\'ithout <luverseJv affecting the ml.lrkctahilitv of su<..~h offering . '- . "-

(.induding an adverse elIect OIl the per share offering price), the Company \,>'ill include in

such ofJering only sllch number of securities that in the reasonable opinion of such

m,maging undenniters can he sold 'without adversdy affecting the marketability of the

alTering (including an adverse effect on the per share offering price), which securities

\""ill be so included in the following order of priority: (A) first, in the case ora Piggyback

Rcgistr3tion under Section 4.5(a)(iv), the securities the Company proposes to scll. (8)

then the Registrable Securities of the Investor and all other Holders \vho have requested

inclusion of Registrable Securities pursuant to Section 4.5(a)(ii) or Section 4.5(a)(iv), as

applicable, pro rata on the basis of the aggregate llumhcr 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 of this Agreement: provided

however, that if the 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 conl1icting agreement to the cxtent

that it would othcT\vise result in a breach under such agreement.

(b) Expenses of Registration. All Registration Expenses incurred in

cOlmection \1/it11 any registration, qualification or compliance hereunder shall be bome by the

Company. All Selling Expenses incuITed in connection with any registrations hcreunder shall be

borne by the holders of the securities so registered pro rata on the basis ofthe aggregate offering

or sale price ofthe securities so registered.

(c) Obligations of the Compau\'. The Company shall usc its reasonable best

drofts, for so long as there are Registrable Securities outstanding, to take such actions as are

under its c.ontrol to not: become un ineligible issuer (as defined in Rule 405 under the Securities

Act) and to remain a ,vell-knolAl1 seasoned issuer {as defined in Rule 405 under tlle Se,curities

Act) ifit has such st.1.tus on the Signing Date or becomes eligible for such statlls in the, future. [n

addition, whenever required to cEfecl the rcgislfation of any Registrable SC'curitk's or facilitate

the distribution of Registrable Securities pursuant 10 JIl dfective ShdfRcgistration Statement,

the CompuJ1)' shall, as e:xpeditiously a.s reasonably practicBhk:

{i) Pn::p3re and file with the SEC 3 prospectus supplcm('nL \>,'ilh

reSpt'ct to a proposeJ otl('ring of Registmble Securities pur~llant \0 an cO;;ctive

reglstration ;.;t(jtem~nl, subjel.'! 10 Section 4':'(d), kc~p :iuch rGgistnltioll st8iCnlen:

dl~ctive :.md keep such rrospcl.:'ru~ 5upp{cmem Cl1J:I'(;nt nn1i! the st''-Curitks d~sCJihed

t.h~-.r~in al\.~ n~) longfr R\"~gJstrabit' SeClwitie,<;.

21
(ii) Prepare and file with the SEC such amendments and supptements

to tht applicable registration statement and the prospectus or prospectlls supplement used

in connection \'lith such registration statement as may be necessary to comply with the

provisions of the Securities Act ""lih respect to the disposition of all secmitics covered by

such registration statement.

(iii) Furnish to the Holders and any unden"Tlters such number of copies

o1'thc 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 confonnity v\'iib the requirements of the Securities Act, and such other

documents as they may rea'>onably request in order to hlcilitate the disposition of

Registrable Securities mvoed or to be distributed by them.

(iv) Usc its reasonable best cflorts to register and qualify the securities

covered hy such registration statement under such other securities or Blue Sky la\vs of

such jurisdictions as shall be reasonably requested by the Holders or any managing

undenvritcr(s), to keep such registration or qualification in eHect for so long as such

registration statement remains in cileet, and to take uny other action which may be

reasonably necessary to enable such seller to consummate the disposition in such

jurisdictions of the securities oVvllcd 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 ofprocess in any such states or jurisdictions.

(v) Notify each Holder of Registrable Securities at any time when a

prospectus relating thereto is required to be delivered under the Securities Act of the

happening of any event as a result of \".hich the applicable prospectus, as then in enect,

includes an wltrue 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.

(vi) Give \\Titten notice to the llolders:

(A) when any registration sultcmen! tiled pursuant to Section

4.:"(a) or any amendment thereto has been filed with the SEC (except for

imy amendment effected by the filing of a document 'A-1th the SEC

pur:'iuant to the Exchange Act) and when such registration slatement or

any post-eiTectivc amendm-.:nt thcrdo has hecome efTective;

(B) (11' an)" r('qU(~SI hy tbe SE(: for amclldrnenl~ or snppkments

to any reg.istratbn statClnent or the prospectus included thcn:in or for

additional iuti."\rmation;

I.e; uf tlK ls;,;uanc:(; b:, th..:- SEC of any slop 0rJ.;;r susp':,:nding

the eff<::ctf\ell<:'ss (If an~i l't'.gl~trmjiln stat:?ment or tht' initiation of any

pF.K'ccdinl:::s fur ti1ill pUfp,':-'C;

"
(D) of the receipt by the Company or its legal counsel of any

notification with respect to the suspension of the qualification of the

Common Stock for sale in any jurisdiction or the initiation or threatening

of any proceeding for such purpose;

(E) of the happening of <ill)' event that requires the Company to

make changes in <lny dTectivc registration statement or the prospectus

related to the 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 I13VC been

m;:lde); and

(F) if at any time tbe represt~ntations and warranties of the

Company contained in any underv>'Titing agreement contemplated by

Section 4.5(c)(x) cease to be true and COlTect.

(vii) Use its reasonable bcst efforts to prevent the issuance or obtain the

withdrawal of any order suspending the efIectiveness of any registration statement

referred to in Section 4,5(c)(vi)(C) at the earliest practicable time.

(viii) Upon the occurrence of any event contemplated by Section

4.5(c)(v) or 4.5(c)(vi)(E), promptly prepare a postweffcctive amendment to such

registration statement or a supplement to the related prospedus or file any other required

document so that, as thereafter delivered to the Holders and any undenvritcrs, the

prospectus \vill not contain an untrue stH.tement of a material fact or o111it to state any

material fact necessary to make the statements therein, in light ofthe circumstances under

\vhich they \>,'ere made, not misleading. If the Company notiiies the Bolders in

accordance with Section 4.5(c)(vi)(E) to sllspend the use of the prospectus until the

requisite changes 10 the prospectus have been made, then the Holders and any

undef\\Titers shall suspend use of such prospectus and use their reasonable best efforts to

retum to the Company all copies of such prospectus (at the Company's expense) other

than permanent flk copies then in such Holders' or underwriters' possession. The total

number of days that any such suspension lIlay be in effect in any 12·month period shall

not exceed 90 days.

(is) Use rC<:isonablc best efh)rts to procure the COOfteration of the

Company's transfer agent in sCllling an:y offering or sale of Registrable Securities,

inchhling \vith respect!l) the lnl.Jlsier of physical siock certificates into book-entry form

in accordanc... with ~Iny 'pf(\('~dllres 1l:'as{lm1bly requested by the Holders or <my m::'llldging

\mden\;rltcr{.~).

IX} If le.l llndcn~'1'ittell offcI;r~g: is n:.'qucstcdpi.lrstl:mf hi St....:ti,)n

4,5ja)(ii)., entu ir:to e.n unJ~rwTilillg agrecmCnll~l nL';.1pmaryl{mn, scope and sub~tancc

and t.'lk(\ all su;::h other i:1ction:, n:asonahly nXjIlt's:ed by the Holders of;) mnjority (if the

R(.'f!1;.;tl'8bk· .sci.:uritic;:: b.... ing "old ill (onr;t',ctil)n t1Jere~vilh or by the lmmaging

ul1dl..:f\vrit.t'u<,:), d allY, to <:spdilT U~ raciliH1.!(, tilt! ,mderv,Tl1kn di.:'lX:<:i1l011 of sucb

23
Registrable Securities, and in connection therewith in any underwrltlen onering

(induding making members of management and executivcs of the Company available to

participate in "road shows", similar sales events and other marketing activities), (A) make

such representations and warrunties 1.0 the I-IoJd(,.~rs that arc selling stockholders and the

managing underwriter(s), if any, v'lith respect to the business of the COmp;U1}' and its

subsidiaries, and the Shelf Registration Statement, prospectus and documcnts, if any,

incorporated or deemed to he incorporated by n.:fercIH.'c therein, in each case, in

custom::try form, substance and scope, ,md, if true, confirm the SaJIle if and when

requested, (B) use its reasonahle best etTorts to furnish the underwriters with opinioIls of

counsel to the Company, addressed to the managing undcrv,Titer(s), jf any, covering the

matters customarily covered in such opinions requested in underwritten offerings, (C) use

jts reasonable best efforts to obtain "colJ comfort" letters from the independent certified

public accountants of the Company (and, if necessary, any other independent certified

public accountants of any business acquired by the Company for which financial

statements and financial data are induded in the Shelf Registration Statement) \vho have

certified the financial statements included in such Shelf Registration Statement,

addressed to each of the managing undenvriter(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 undcT\vriting 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 he reasonably requested by the Holders of a majority of the

Registrable Securities being sold in connection therewith, their counsel and the managing

undcrwriter(s), if any, to ..-:videncc the continued validity of the representations and

warranties made pursuant to clause (i) above and to evidence compliance \vith any

customary conditions contained in the undcr\\Titing agreement or other agreement

entered into by the Company.

(xi) Make available for inspection by a representative of Holders that

arc selling stockholders, the managing underwTiter(s), if any, and any attoJ11cys or

accowlt.ants retained by such Holders or managing undemTiter(s), at the offices where

nOffimlly kept. Juring reasonable business hours, financial and other records, pertinent

corporate documents and properties orthe Company, and cause tIlt,: officers, directors and

employees of the Company to supply aU information in each case reasonably requested

(and of the type customarily provided in connection with due diligence conducted in

wnncction with a rcgislert:d public oJIering of securities) by any SLiCh representative,

111l:1naging undenHitens), attorney or accountant in L:onn~dion \....iih such Shelf

Rt'gistration Statement.

(xii! Use reasonable best "HoLT:; to cause aU such Kegi:,trable Sccllriti..::.

to he lisLed on ea(',h national 5c,:urities exchunge on which simihtr securilj('~ issued by the

Company :lrc t!l(':(l listt~d or, if UtI similar :;('<..'uritI~~s issl1<"d hy the Comp,.l1lj' aCi: then listed

,!Il <1ny natiollol f.:.(-'i.:mitics exclmnge, usc its [t'ZlslmahJe be,s!: tJforts In c.allse fill such

Registrable Sen1rilk~ 10 he Li$tcd (In such secunties c.xl.'hJ:ngt' ;"J" the Investor may

designate.

24
(xiii) If requested hyJ Iolders of a majority of the Registrable Securities

being registered and/or sold in connection thcre"vith, or the managing underwriter(s), if

any, promptly include in a prospectlls supplement or amendment such intonnation as the

Holders of a ll1<\jority of the Registrable Securities being registered and/or sold in

connection therc\vith or tmmaging underwriter(s), if any, may reasonably request in order

to permit (he in1cndr.:d metbod of distrihution of such securities and make all required

filings of such prospectus supplement or such amendment as soon ,LS practicable alief the

Company has received such request.

(xiv) 'lime1y provide to its security holders earning statements satisfying

the provisions of Seclion 11(a) ofthe Securities Act and Rule 158 thereunder.

(d) Suspension of Sales. Upon receipt of \\Titten notice from the Company

thal 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 andlor Holder has received copies of a

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,

prospc-ctus supplement may be reswned, and, if so directed by the Company, the Investor and/or

such Holder shall deliver to the Company (at the Company's expense) aJl copies, other than

permanent file copies then in the fnvcstor and/or such Holder's possession, of the prospectus and,

if applicable, prospectus supplement covering such Registrable Securities cunent at the time of

receipt ofsuch notice. 111c total number of days that any' such suspension may be in effect in any

12-month period shal1 not exceed 90 days.

(c) Termination of Registration Rights. A Holder's registration rights as to

any securities held by such Holder (and its AHili3tes, partners, members and former members)

shall not be availahle unless such securities are Registrable Securities.

(1) FmJIishing Inhmnation.

(i) Neither the Investor nor an,Y Bolder shall use any free \Hltlllg

prospt.>C1US (:IS defined m Rule 4(5) ill connection with the sale nf Registrable Securities

Witlll'ut the prior writkn conSl,,:ut ofthe Cl1mpany,

(ii) It ~h~IU be a conditi()n precedent to the oblig,H!OnS of tbe Company

10 take any actton pursuant ttl Section 4.5(c) tl1.1t Invc,tp!' and/or tbe ~eJjing Holders and

1h<.:' Ul1f~l.'Twritl:rs, if any, shaH furnisb t(~ tb\.O Cnmp:my such information rcgardjIl~

{hcmscl\iC'~, (:le R('gistrabk Securities held by them and the intended metlwd of

dispositi0J~ ,:If swJj ~cc,UliUes- a!i sl1Jll Ix: rcqmfcd to dfu:t tbe rc,glstered (lrf('ring oflht'ir

R':-g'lstrabk S.;:~:wilil~$.,
(i) The Company agrees to indemnii)! each Holder and. if a Holder is

a person other th<:U1 an individual, such Holder's officers, directors, employees, agents,

representatives and Affiliates, and eJ.ch Person, if any, that controls a Holder \vithin the

mcnning of the Securities Act (each, 311 "Indemnitee"'), against any and all losses, claims,

damages, actions, liabilities, costs and expenses (including reasonable iees, expenses and

dishursements of attomcys and other professionals incurred in connection with

investigating, deicnding, settling, compromising or paying any such losses. chlims,

d,mluges, actions, liabilities, costs and expenses), joint or severaL ,noising out of or based

upon any untrue statement or alleged untrue statement of material fact contained in uny

registration stHtcmenLincluding 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 \\Titing prospectlls (as such term is defined in Rule

405) prepared by the Company or authorized by it in wTiting 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 tlnal prospectus contained

therein or any such amendments or supplements thereto or contained in any free writing

prospectus (as such tenn 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), in

reliance upon and in conformity with information regarding such Indenmitee or its plan

of distribution or o\vnership interests which was fumished in \\Titing 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) oiTers or sales effected by or on behalf of

such Indemnitee "by means of' (as defined in Rule 159A) a '·free \vriting prospectus" (as

defined in Rule 405) that \vas not authorized in writing by the Company.

(ii) If the indemnification provided for in Section 4.5(g)(i) is

unavailable to an Indemnitee \\·ith respect to any losses, claims, damages, actions,

liahilities. c·osts Of expenses rcferrcJ to therein or is insufficient to hold the l.ndcITmitee

harmless as contemplated therein, thl'n the Company, III lieu of indemnit~illg sw::h

Indemnitee, shall contribute to the amount paid or payable hy such Indemnirel>: as a !"('sult

or such losses, claim:<-, damages, acllmlS, liahilities, costs or expenses in such proportion

<IS is 3ppr0priate to reflect th(' n:btiw fault of th¢ IndcnmitC'c, on the one h:md, and the

Company, nn the other hand, in C'olltl;?-ction with the ~tiltemen\s ~lr om],''t;;ioTI::: \\hit.:.h

rc"ulted in such Josse:-, t,.'laims, damages, action~. !i~llfiliji('.s, CUB1::> or t':.x_pense:-: as ,..'ell ,IS

any other rcle-vant ('lJui1.abk consid'::l"<tti(\ns. The relative f<lult ofl.h(' Company, OJ] the DUt'

hand, and of (h\., Indi:.~mnitct'. on fhe (nhc:r hand, sId! be (k"tennined by rcieri:'rl\;C lo.

JnKHl@- other factors, v,:hetlwr t:le u;l{rue statement cd: a mat('T:a! t~\ct or omis.-:ion w stat~ a

rnatl,;rial tLler r...:lal.es t(, lntl)nnatior: :,-urplicd by thl' Cl111~pRn:,' or by ilK' Inde:1nirc.::: and

tr:e p:.'J"tic.:;' rdative jnti'.'tH, knO\Ykc~.c, acc~'s~ ':I' inl'i:Jrm:Hion and ('PP(lmmity to c:orrc~·,t ;:i1-

26
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 4.5{g)(ii) wen":

detenl1incd by (11'0 rata allocation or by any other method of allocation that does not take

account of the equitable considerations referred to in Section 4.5(g)(i). No Indemnitee

guilty of fraudulent misreprcsenk1.tion (v.'ithin the meaning of Section It(t) of the

Securities Act) shall be entitled to contribution from the Company if the Company was

nnt guilty of such haudulcnt misrepresentation.

(ll) Assignment of Registration Rights. The right:o; of the Investor to

registration of Rcgistrahle Securities pursuant to Section 4.5('.1) rnay he assigned by the Investor

to a transferee or assignee of Registrable Securities \vith a liquidation preferen"c or, in the case

of Registrahle Securities other than Preferred Shares, a market value, no less than an amount

equal to (i) 2!% of the initial aggregate liquidation preference of the Preferred Shares if such

initial aggregate liquidation preference is less than $2 billion and (ii) $200 million if the initial

aggregate liquidation preference of the Preferred Shares is equal to or greater than $2 billion;

provided, )unt:ever. the transferor shat!, \vithin ten days after such transfer, furnish to the

Company \witten notice of the name ,md address of such transferee or assignee and the number

and type of Registrable Securities that are being assigned. for purposes of this Section 4.5(h),

"market value" per share of Common Stock shaH be the last reported sale price of the Common

Stock on the national securities cxch,mge on which the Common Stock is listed or admitted to

trading on the last trading day prior to the proposed transfer, and the "market value" for the

\\'arrant (or any port.ion thereof) shall be the market value per share of Common Stock into

which the Warrant (or sueh portion) is exercisable less the exercise price per share.

0) Clear Market. With respect to any undenvritten otTering of Registrable

Securities by the fnvestor or other Holders pursuant to this Section 4.5, the Company agrees not

to eflCct (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, in the case of an underwritten offering of

Conunon Stock or Warrants. any of its equity secLlIities or, in the case of an undcr\witten

alTering of Preferred Shares, any Preferred Stock of the Company. or, in each case, any securities

convertible into or exchangeable or exercisable for such :o;ccuritics, during the period not to

exceed ten days prior ,md 60 days lo11owing the effective date of such olTcting or such longer

period up to 90 days as may be requested by the managing under-wTiter for such underwritten

aJTering, The Company also agrees to cause such of its directors <md senior executive onicefs to

execute and deliver customary lod:-tlp agreements in such form and f()1" such time period up to

90 days as may be requeBted by the managing undenwiter. '',(,!'If'ciul Registrafion" means the

registration llf (i\) equity secW'itics and.'-or options or ~,ther nghts in respect thereof sokly

regiskn:d 1m Form S~4 (1f Form S-8 (or successor form) or (B) shares of equity securitil':~ andior

oplions or other rights in rcsp'--"Ct therel'Y to he oJ1{:red to directors, mcmhe.rs of mil11."lgcnwnt,

employees, consult;mts, (~ustOD1("[S, kJJder:" PI' vendor:: of the Company or Cnrnpany Subo:;idiaries:

or in cor.necLion .....'vi111 dividenJ relJ1'\;estm<:.:nt plans,

(.1) EH1!.:.Jj4~.I\J~;:::.J.14/~.· \\'iUl a vk-w to making a\'ailahk to the In.....estor dnd

H-:'ldcrs. th(~ ~l(:t'.Cnts (If certain ruks and r(;'~ulJt;<)!lS qf thl."': SFC w!Ikh may perm.it (Jl(' suh of the
Registrable Securities to the puhlic without registration, the Company agrees to us~ its

reasonable best eff(.1rts to:

(i) make and keep public infonl1ation anlilable, as those tenns arc

understood and defined in Rule 144(c)(l) or any similar or analogous rule promulgated

under the Securities Act, at all times after the Signing Date;

(ii) (A) file with the SEC, in a timely munncr, all reports and other

documents required of the Company und~r the Exchange Act, and (B) if at any lime the

Company is not required 1.0 file such reports, make available, upon the request of any

Holder. such information necessary to permit sales pursuant to Rule 144/\ (including the

infOt11lation required by Rule 144A(d)(4) under the Securities Act);

(iii) so long as the Investor or a Holder o\vns any Registrable Securities,

furnish to the Investor or such Holder forthwith upon request: a \vritten statement by the

Company as to its compliance with the reporting requirements of Rule 144 under the

Securities Act. and of the Exchange Act; a copy of the most recent annual or quarterly

report of the Company; and such other reports and documents as the Investor or Holder

may reasonably request in availing itself of any rule or regulation of the SEC allmving it

to sell any such securities to the public without registration; and

(iv) take such further action as any Holder may reasonably request, all

to the extent required from time to time to enable such Holder to sell Registrable

Securities without registration under the Securities Act.

(k) As used in this Section 4.5, the folto~1ng tenns shall have the follmving

respective meanings:

(i) "!lolder" means the Investor and any other holder of Registrable

Securities to wholll. the registration rights conferred by this Agreement have been

transfcned in compliance with Section 4.5(11) hereof.

(ii) "Holder::,' CUl/riSer means Olle counsel for the $clJing Holders

chosen hy !loJdcrs holding a majority interest in the Regis1rahlc Securities bcmg

rcgj~tcrcd.

(iii) "Regis!cr,'· "registered," and "rcf!;istration" shall rder to a

registration dfccted by pre.paring and (A) filing a registration slatement in

c\1mpii3nc,e wL(h lhe Secmiti,:'s ,\ct and applicable ruks and r~gulations

thereUlhIcr, and the dedilf~dion or orderiIJg (d' elTedivenes5 of stICh regic;traliol1

ststemCl1l or (B) filing a pro::;p~clu::: .mdi,.1r prospectus suppk:ment in respcc1 of an

approrri~lt~ effel.'live rci-istratjoll si:H('InCnt on Form S~3,

(iv) "Registrable S"curitie/ means (.A) a!l Preferred Sh,lres, (loon th,;

\VItlTi:i.nl t~llb.1t·ct to Sectlon 4.5(r) and (Cl any t:J.il:-ity :,;{'c,urille" issued or

iSsu;lble ,Jtrectl:," <:.T wdirccl!y with re:spect to dK se~uri.tie~ tL~klTL·d L;) in the

28
foregoing clauses (A) or (B) by way of conversion. exercise or exchange thereof,

including the Warrant Shares, or share dh'jdend or share split or in connection

with a comhination of shares, recapitalization, reclassification, merger,

amalgumation. 8nangcrnenL c,ol1solidation or other reorganization, provided that,

once issued, such securities will not be Registrable Securities when (1) they are

sold pursuant to an clrective registration slaterncnt unJer the Secunties Act, (2)

except as provided below in Section 4.5(0). they may he sold purswmt to Rule

144 without limitation thereunder on volume or manner of sale, 0) they shaH

have ceased to be outstanding or (4) they have been sold in a private transaction

in which the transferor's rights under this Agreement aIC not assigned tn the

transt'cn:e of the secmitics, No Registrable Securitil:s may he registered under

more than one registration statement at anyone time.

tv) "Registration Expenses" mean all e;xpenscs incurred by the

Company in effecting any registration pursuant to this Agreement (whether or not

any registration or prospectus becomes effective or final) or other-vise complying

\\'ith its obligations lmder this Section 4.5, including all registration, filing and

listing fees, printing expenses, fees and disbursements of counsel for the

Company, blue sky tees and expenses, expenses incurred in eonnection with any

"road show", the reasonable fees and disbursements of Holders' Counsel, and

expenses of the Company's independent accountants in connection \"jth any

regular or special reviews or audits incident to or required by any such

registration, but shan not include Selling Expenses.

(vi) '·Rule 144", "Rule ] 441'1", "Rule 159A", "Rule 40r 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.

(vii) "Selling Expenses" mean all discounts, selling commissions and

stock transfer taxes applicable to the sale of Reglstrablc Securities and fees and

disbursements ()f counsel for any Holder (other th~Ul the fees and disbursements of

lIoldcrs' Counsel included in Registration Expenses).

{l) At any time" any holder of Securities (induding llny Holder) may dect to

forfeit its right.<; set torth in this Section 4.5 from that date forward: provided, that [I Holder

f(nJeiting such rights :;.hailnoncthdcss he entitled to participate under Section 4,5(a)(iv).- (vi) in

~U1y Pending Underwritten Ofteri11g to the same extent that such Holder would have been cntitkd

to ifthe hohler had not v.ithdmwn: and provided, lu~·t!wr, that no such ll.wft'ifure shalll(Tm!Jlaic U

Holder's, right!' or ubljgations und.er SCG!lQU 4.5(f) with re:'\p~ci to any prior rcgi~trmil)n Of

Pending l.~nderwri1ten Ollering. "Pending (}nda,vriUen Of!;~ri!1g" mCI.UL", with respect tn tillY

Holder j~lr1t:iting its right.;; pursuant to thi" Seditl!l 4.5(1), any llwlenvri1tell \)'H('ring vf

Registrable Securities in ~\"lJj;;;h such Holder ha..; advi~ll.ht· (\m1pL1J.l)' \if its HEcnt to register i'iS

R~gistrablc S\'~~uritiC'~ (,tther pur::mant to S~eti0n ·t5!.al(H) or 4.5{a.l(iv) IJr;Pf to the dilte of ~uch

rh.l1c..:fs f(l';f(;~111rc.
(m) Specifr.c Performance. The parties hereto acknowledge that there would be

IlO adequate rCn1(.~dy at law if the Company l~li1S tu pcrfonn any of its obligations under this

Section 4.5 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 ,my

other remedy to which they may be entitled at law or in equity, to the (nIlest extent permitted and

enforceable under applicable law shall be entitled to compel specific perf01111<UH.:t' of the

obligations of the Company l..mder this Section 4.5 ill accord,mce \vith the tenns and cunditions

of this Section 4.5.

(n) No IncOJ]sisL@t Agreemcnls. The Compa.Jly· shall no1. on or after the

Signing OdlC. enter into any agreement with respect to its securities that may impair the rights

granted to the Investor ,md the Holders under this Section 4.5 or that othcl\vise contlicts with the

provisions hereof in dn)' manner that may impair the rights granted to the Investor and th~

Holders under this Section 4.5. In the event the Company has, prior to the Signing Dale, entered

into any agreement with respect to its securities that is inconsistent ",'ith the rights granted to the

Investor and the Holders under this Section 4,5 tincluding abJfeements that are inconsistent with

the order of' priority contemplated by Section 4.5(a)(vi)) or that may otherwise contlict with the

provisions hereot: the Company shall use its reasonable best efforts to amend such agreements to

ensure they arc consistent with the provisions of this Section 4.5.

(0) Certain Offerings by the Investor. In the case of any securities held by the

Investor that cease to be Registrable Securities solely by reason of clause (2) in the definition of

"Registrable Securities," the provisions of Sections 4.5(a)(ii), clauses (iv), (ix) and (x)-(xii) of

Section 4.5(c), Section 4.5(g) and Section 4.5(i) shall continue to apply until such securities

otherwise cease to he Registrable Securities. In any such case, an "undcf\.vritten" offering or

other disposition shall include any distribution of SUGh 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 otfellng document approved by the Company and used in connection ""ith such

distribution.

(p) B-egist~red Sales of the \~/arrant. The Holders agree to sell the Warrant or

any portion thereof under the Shelf Registration Statement only beginning 30 days after

noti(ving the Company of any such sale, during which 30-day period the Inv('stor 3nd all Holders

of the Warrant shall tuke reasonable steps to agree to reYisions to the Warrant 10 pennit a public

dismbutiou ofthe \VmTanL including entering into a warr~ull agreement and appointing a warrant

Jgcnl.

46 \"1!ling~Qf Wim;glt SJ"li!L~. :--Jotwltb~tanding atl;1:hing in this Agr-ccrnent to 1he

contrary, tht investor shaJlllot exerClse ,my vNing rights \".'jlll respecl 1'u the \Varrani Shares.

4.7 I.~'!J§\1.<:lr~5b,;11:9~. 'Upon rC'qut:::~l by the lnv>;;s(m ?t all)' Iin,e idlowing tbt.~

O\)sing Date, the Cnn1p~my shall promptly enter into II depositary :Jmrngernent, pursuant 1:0

\~llshrtw:r~ ~1grc('m(',nt;:; reasonably sati:-::Cxtory in (he. Inv(,sl('~r nnJ v,ith fl. d(~pudtaT:V n;as(l/1ably

'K·'.:t:'pbhic to the lnn':'s'lor. purslJ~mt to wluch th",; Pr,-,r~~n.~d Slwn!s may b~ (k~P{l,:>i:tXl <md

de;wsitary sha::'c", t\1ch representing :1 fracti\~n of a Pre.fcmxi Shr.u\~ as Slh::t.:iti<.'d hy l!l~ Imestol',

30
may be issued. From and aHer the execution of any such depositary aJTangement ami the deposit

of any Preferred Shares pursuant thereto, the depositary shares issued purSu~U1t thereto shall be

deemed "Preferred Shares" and. as applicable, "Registrahle Securities" !{)f ptl1])oses of this

Agreement.

(a) Prior to the earlier of (x) the ihird anniversary of the Closing Date 1md (y)

the date on which the Preferred Share" have heen redeemed in whole or the Investor has

transferred all of the Prefem.::d Shares to third parties \\'hich arc not Affiliates of the lnvestor,

neither the Company nor any Company Suhsidiary shalL without the consent of the Investor:

(i) declare or pay :Jny dividend or make any distribution on the

Common Stock (othcr than (A) regular quarterly cash dividends of not more than

the amount of the last quarterly cash dividend per share declared or, if lower,

publicly announccd an intention to declare, on the Common Stock prior to

October 14, 2008, as adjusted fOf any stock split, stock dividend, reverse stock

split, reclassification or simibr transaction, (B) dividends payable soiely in shares

of Common Stock and (C) dividends or distributions of rights or Junior Stock in

connection \\lith a stockholders' rights plan); or

(ii) redeem, purchase or acquire any shares of Cornmon Stock or other

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

preferrcd securities issued by the Company or any Affiliate of the Company, other

than (A) redemptions, purchases or other acquisitions ofthe Preferred Shares, (B)

redemptions, purchases or other acquisitions of shares of Common Stock or other

Junior Stock, in each case in this clause (B) in connection with the administration

of any employee benefit plan in the ordinary course of business (including

purchases to offset the Share Dilution Amount (as delined below) pursuant to a

publicly announced repurch3se plan) and consistent with past practice; provided

that any purchases to offset the Share Dilution Amount shall in no event exceed

the Share Dilution AmlJunt, (C) purchase,s or other acquisitions by a broker-dealer

subsidiary of the Company solely for the pUll,ase of market-making, stahilization

Dr customer bcilitation transactions in Junior Stock or Parity Stock in the

ordinary course of its business, (D) purdwscs by a hroker-dealer subsidiary of the

Company tIl' capiwl stock of the C\mlpany for resale pursuant to an offering by

the Company ofsuch capitaL stock lIndcrwrjtit~n by s1.1ch brokcr-d~alt:r sunsidiary,

0:) any redemption or n;~purchllsc of righlspursuant to any stoclJloJders' rights

plan, i'F) the acquisition by 11k' CQrnpany or :my of tb\.'; ('ompany Subsidiarie:-: of

record o~vnershjp in Junior Sh)(:k or PdlTty SlOck f(ll' the beneficial ownersbiv of

nny otJWf person;; (dher than (be Compi.lny or any otllt::r C\lmp,my Sub:::idiary),

includIng as trust~l,~;'; or custCtdians. and (01 tjk~ cxchanl.!;e or COI1VerSIOn of Junior .... ..... ",

Stot.'.k l(lf ('r into other Junl(lf Stock or pf P:.Jrity Stuck or trust prdeneJ s<,'cllrittcs

LlH' lit' into 0111er P.'1.rify SJock (With rhe :-a1l1e orleS.'1tf agg.n~gate liytlid~tti(\n

<lHlI)UJIt) ,"'r Junior SlOck, in ea;.'!) ...'-::LS;: :,<:'T forth :n this eLmse ((t), sil}eJy to tilt'

e,\t\':tJt fequ:rt~Jpursu:mt to hnding cOHfmc,ufll :It:Tccmcnt:'i c'.ntcred intf.' prior to

.11
the Signing Date or any subsequent agreement for the accelerated exerCIse.

settlement or exchange thereof for Common Stock (clauses (C) and (F).

collectively. the "Permitted RepW'chases"). "Share Dilutioll Amoulit" means the

increase in the number of diluted shares outstanding (de.tenllined in accordance

with GAAP, and as measured from the date of the Compan:y's most recently tiled

Company Financial SU'ltemcnts prior to tht' Closing Date) resulting hom the grant.

vesting or exercise of equity-bascd compensation to employees and equitably

adjusted tor <my stock split, stock dividend, reverse stock split, rcclassitlcation or

similar transaction,

(b) Until such time as the Investor ceases to o\\'n any PrcfclTed Shares. the

Company shall not repurchase any Prei"em:d Shares from any holder thereof whether by means

of open market purchase, negotiated transaction, or otherwise, other than Permitted Repurchases.

unless it olfers to repurchase a ratable portion of the PrcJerred Shares then held by the Investor

on thc same tenus and conditions.

(c) "Junior Stock" means Common Stock and any other class or series of

stock of the Company the tcnns of which expressly provide that it ranks jtmior to the Preferred

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

Company. "Parity Stock" means any class or series of stock of the Company the tcmlS of which

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

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).

4.9 Repurchase of Investor Securities.

(a) Following the redemption in ·whole of the Preferred Shares held by the

Investor or the Transfer by the Investor of all of the Preferred Shares to one or more third parties

not affiliated \vith the Investor, the Company may repurchase, in whole or in part at any time

any other equity securities of the Company.' purchased hy the Investor pursuant to this Agreement

or the Warrant and then held by the Investor, upon notice given as provided in clause (b) belo,x,

at the Fair l'Yfarket Value of the equity security.

(b) Notice of eyery repurchase of equity securities of the Company held by

the Investor shaH be given ot the address and in the manner set ttl1th for such party in Section 5.6.

Each notice of repurcha....:;e given to the lll\'estor shall state: (j) the numb<3r and type of secmities

to be n.'purchased, (in the B(lard u1' Din:::chH·'S deleTminatioll of Fair Market Value of such

securities and (iii) tht~ phH.'C (yr ph.:c~ whcn~ ce-liiJic:lll.'S rcprcs..:-nting such securities are to be

surrcl1derc,d t~!r payment of th..:.' repurchase prict,. The r.:;pureha.<;c. of the securities specified in

fh~ noti>.:e shaH m:,cUt" ..1.'{ ~onn asprac.ticabll: following the detclminalion of the: Fair r'vlarkct

Value ofthe securities.

(c) As l1sed in this S\.~,.;!lun 4.9,:he fC'Ut'willg tCtnlS shan h;1VCUW f,Jllm..ylng

r¢sp-cctlv(' m('ani:lfts:
(i) "Appraisal Procedure" means 3 procedure whereby two

independent appraisers, one chosen by the Company and (lIlt' by the Investor- shall

mutually agree upon the Fair Market Value. Each party shall deliver a notlce to the other

appointing its appraiser within 10 days after the Appraisal Procedure is invoked. If

within 30 days after appointment of the two appraisers they are unable to agree upon the

Fajr Market Value, a third independent appraiser shall be l:hosen within 10 days

thereafter by the mutual consent of such first tv\,·o appraisers. The decision of the third

appraiser so appointed and chosen shall be given within 30 days after the selection of

such third appraiser. If three appraisers shall be appointcd and the determination of one

appraiser is disparate from the middle determination by more Ih~U1 twice the amount by

which the other determination is disparate from the middle detennination, then the

detclmination of such appraiser shall be excluded, the remaining t\\lO detemlinations shaH

he averaged and such average shall be binding and conclusive upon the Company and the

Investor; othen"risc, the avcrage of all three determinations shall be binding upon the

Company and the Investor. The costs of conducting any Appraisal Procedure shall be

borne by the Comp,my.

(ii) "Fail' Market Value" means, with respect to any security, the fair

market value of such secmity as determined by the Board of Directors, acting in good

hlith in reliance on an opinion of a nationally recognized independent investment banking

finn retained by the Company for this purpose and certified in a resolution to the Investor.

If the Investor does not agree with the Board of Director's detemlination, it may object in

w-riting within 10 days of receipt of the Board of Director's detennination. In the event of

such an objection, an authorized representative of the Investor and the chief executive

officer of the Company shall promptly meet to resolve the objection and to agree upon

the Fair Market Value, If the chief executive officer and the authorized representative arc

unable to agree on the Fair Market Value during the 10-day period following the delivery

of the Investor's objection, the Appraisal Procedure may be invoked by either party to

determine the Fair market Value by delivery of a Vo.Titten notification thereof not: later

than the 30th day after delivery ofthe In'liestor's objedion.

4.] 0 Executive Compensation. Until such time as the Investor ceases to o\vn any debt

or equity securities of the Company acquired pursuant to this Agreement or 1he Warrant the

Company shall take all necessary action to ensure that iL<; Benefit Plans with respect to its Scnior

Executive Officers comply in all respects with Section 111(b) of the EESA as implemented by

any guidance Of regulation thereunder that ha.<; been issued and is In c-ffcCI as ofthe Closing Daw,

,md shall not adopt any ne'\\' Benefil Plan with respect to its Senior Executive Officers that d\)cs

nol comply thel'c'\'ith. "S'enior EXC:CUlive O/7icen" means the Company's "senior executive

OftiCt'fS" 2:<; defim'd in su!:"st'\.',rion 111l,h)O) of the FE-SA :md regulations is\ued IhereunueL

mcLllding the mJcs .set t:;,)\,th jll 31 eY.R, Part }O.

Articl(' V

\fbt,elIanNJus
(a) by either the Investor or the Company if the Closing shall not have

oCl'urred by the 30th calendar day Jt.111owing the. Si~lling Date; provided, huwever, that in

the event the Closing has nt)! occulTed by such }Oil calendar day, the parties \vill consult

in good faith to detenninc whether 10 extend the term of this Agreement, it being

understood that the parties shall be required to consult only until the fifth day after such

30th calendar day and n,:n be under any obligation to extend the teml of this Agreement

then:after; [mn:ided,ful'lher, that the right to terminate this Agreement under this Section

5.1(a) shall not be availahle to any party whose b1't'ach of any representation or \varranly

or failure to perform any obligation under this Agrecment shall havc caused or resulted in

the i~lilure of the Closing to occur on or prior to such date; or

(h) by either the Investor or the Company in the event that any Governmental

Entity shall havc issued an order, decree or nrling or taken any other action restraining,

enjoining or otherwise probibiting the transactions contemplatcd by this Agreement and

such order, decree, mling or other action shall have hecome final and nonappealable: or

(c) by the mutual written consent of the Investor and the Company.

In the evcnt of termination of this Agreement as provided in this Section 5.1, this Agrcement

shall fortl1\vith 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.

5.2 Survival of Representations and WaJTanties. All covcnants and agreements, other

than those which by their tenns apply in \vhole or in part after the Closing, shall terminate as of

the Closing. The representations and warranties of the Company made herein or in any

certificates delivered in connection with the Closing shall survive the Closing without limitation.

5.3 Amendment No amendment of any provision of this Agreement \'r'ill be effective

unless made in writing and signed by an ofticer or a duly authorized representative of each partY.:

provided that the Invcstor may unilaterally amend any provision ofthi5 A.grcemcnt to the extent

required to comply 'With any changes after the Signing Date in applicable fedcral statutes. 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. pow,",r or privilege. The rights and remedies herein provided shall be

cumulative or uny rights 0f remed.ies provided hy law.

5.4 \Vaiver of Conditions, 'fhe conditions tn each p::nty's obligation to consummate

thr.> Purclmse al'~ t()j" the sole bendi.t ofsuch party and may be waived hy ~uch pany in whole or

in pantp tlw l::xte:nt permitted by applicahle bnv. No waivcI' will he cfJt\ctivc unless it is in a

v,riting. fiigncd by J. duly authorized utli;.;cr of the \'\';:uying party thaI makl,;~~ express reference to

the pwvislon or provisions ~uh.ject to suc.!l 'Ivaiver

5.~ Governing Law: Suhmi~sion to JUI"isdidion, Etc. This Agn{'ment' will be

~{IYt~I'ued hy and l'onstrucd io a(confance with the ft!thmtllllW l}f thetTnht>d States if and to

tilt, (;).ieut stich Jaw b appfi~abk, amI otllt~rwis(' in aCt'(ird.llnl'c with th€ bws oJ thf" State of

KcnYiJd~ a{)pLi"':lblt~ 1:0 c.onlr.at't'1 ttl'Udt, lUld tl~ he (ltrfonncd o,;ntjrdy within such StatC',

34
Each of the parties hereto agrees (a) to submit to tbe exclusiyc jurisdiction and venue of the

United States District Court for the District of Columbia and the rnited States Court of

Federal Claims for an}' and all civil actions, suits or proceedings arising out of or relating

to this Agrecmcnt or the \Varmnt or the transactions conte,mplated bereby or thereby, and

(b) that notice may he served upon (i) the Company at the address and in the manner sct

forth for notices to the Comp:lny in Sl'ction 5.6 and (ii) tbe Investor in accordance with

federal law. To the extent permitted by applic:lhle 13\\0', each of the parties hereto hereby

unconditionally waives trial by jUl), in any civil legal action or proceeding relating to this

Agreement or the "'Mfant or the transactions contemplated herehy or thereby.

5.6 ;-.Jotices. Any notice, request, instruction or other document to be given hereunder

by any party to the other \vill be in writing and \vill be deemed to have been duly given (a) on the

date of delivery if delivered personally, or by tacsimiIc, upon confirmation of receipt, or (h) on

the second business day l()lknving the date of dispatch if delivered by a recognized next day

courier service. All notices to the Company shall be delivered as set fOlth in Schedule A, or

pursuant to such other instruction as may be designated in IhTiting by the Company to the

Investor. All notices to the Investor shall be delivered as sct forth below, or pursuant to such

other instructions as may be designated in writing by the Investor to the Company.

Ifto tl1e Investor:

United States Department ofthe Treasury

1500 Pennsylvania Avenue, NW. Room 2312

\Vashington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

5.7 Definitions.

(a) When a reference is made in this Agreement to a subsidiary of a person,

the term ·'suhsidiary" meallS any corporation, partnership, joint venture, limited liability

company or other entity (x) of v.·bieh such person or a subsidiary of such person is a general

partner or (y) of which a mnjority of the yoting seclilities or other voting interests, or a majority

ofthe securities or other interests of "..-hich having by their terms ordinary voting power to elect a

majority of the board of directors or persons pcrfoIll1ing similar functions with respect to such

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

(b) The tenn "..{llil/ate'· mC,HlS, \vith r.;:spcct to any person. :my person dIrectly

or mdirec.tly controlling, contr<)lled by or unJ~r COmm0!l control \.\1!1', such otlJer p~rs\.'D. For

purposes \)fthis dclinition, "conzrof" l,ill\.:hlding, \vith corrd~lti\'t" meanings, the terms "col1frollt:d

by" ,mel ·'WN}':/" common crmtrol \lith'') Whetl used with n.'specl to any person, me:illS the

po:,scssl\\l1., dinx'lly \:-1' mdircetly. (If tbe power to l'iHlse th,,:, dJr~ction nr managt'mt'nt JmV'or

policics of such PCf$\ll1, wht:ther thTiHigh the oW!1cr::.l1ip of vGtjn~ 'lc;,;ufltks by COntract nr

otherv..-ist.'.,
(c) The tenns "knolVled,\!." ofthe Company" or "Company's knov,:ledge" mean

the actual knowledge 'liter l"cCl.'wnable and due inquiry of the "rdjkers" (as such lenn is de1incd

in Rule 3b-2 under the Exchange Act, but excluding any Vice President or Secretary) of the

Company.

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

liability arising hereunder or by reason hereoC shaH be assignahle by any party hereto withoutlhe

prior '.vriHen consent of [he other party, clOd any attempt to assign any right. remedy, obligation

or liahility hereunder \vilholll such consent shall be void. except (a) an assignment in the case of

a Business Combination \vhcre such party is not the surviving entity, or a sale of substantially aU

of its assets, to the entity whieh is the survivor ofsuch Business Combination or the purchaser in

such S81e and (b) as provided in Section 4.5.

5.9 Sevc.rabiJit.x. If any provision of this Agreement or the Warrant, or the application

thereof to any person or circumstance, is detennincd 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 circumst,Ulces other than those as to which it has been held invalid or

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

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

hereby is not aftccted in any maimer materially adverse to any party. Upon such detennination,

the parties shall negotiate in good faith in an effort to agree upon a suitable and equitable

substitute provision to effect the original intent of the parties.

5.10 No Third Party Beneficiaries. Nothing contained in this Agreement, expressed or

implied, is intended to confer upon any person or entity other than the Company and the Investor

any bcndit, right or remedies, except that the provisions of Section 4.5 shall inure to the benefit

of the persons referred to in that Section.

"'" '"

36
FORM OF CERTIFICATE Ot' DESIGNATIONS

[SEE ATTACHED]

ANNEXA
A:"iNEX A

CERTIFICATE OF I>FSIGNATIONS

OF

FlXFll RATE CLJMIJLATIVF PERPETUAL PREn:RREll STOCK, SERIES 101

OF

[oj

!lnser/nome ofCorportltioflj. a [corporation] organized and existing under the bws of

the I{user' jurixdictioll oforJ:llfliztltiofll (the "Corporation"), in accordance \vith the provisions

or Section [s'] [."l ofthe (In,5'erl appliCtlble ,\"{atuleJ thereof, does hereby certify:

The board ofdjrcctors ofthc Corporation (the "Board orDirectors") or an applicable

committee of the Board of Directors. in accorJam:e with the [certifh:atc of incorporation lUld

bylaws] nfthe Corporation and applicable law, adopted the following resolution on [_j creating

a series of[.] shares of Preferred Stock orthe Corporation designated as "Fixed Rate

Cumulative Perpetual Preferred Stock, Series r-]".

RESOLVED, that pursuant to the provisions oftile lcertitlcate or incorporation and the

bylmvsj ofthe Corporation and applicable lmv, a seri~s of Preferred Stock, par value Sre] per

share. ofthe Corporation be and hereby is created, and that the designation and number ofshares

ofsuch 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 ofsuch

serics, arc as RJlImvs;

Part 1. Desi£mation and Number of Shares. There is hereby created out ortile authorized

and nnissued shares of preferred stock orthe Corporation a series of preferred stock designated

as the "fixed Rate Cumulative Perpetual Prcfcn"J.':d Stock. Series [e]" (the "Desil!nated Preferred

Stock"). The authorized number ofshares of Designated Preferred Stock shall be r-J.

Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached

heretu afC, incorporated herein by reference in their entirety ::lIld shall be deemed to be a p<:lrt of

this CcrtifiLJ.k of Designations 10 the same extent <'IS tfsuch provisions had been set f(llth in full

herein.

Pan. J. l)cfinjtjon~_ The f~JI!(lwing [l'nns arc used in this Certificilte ofDcsignatiolls

(including the Standard PTDvisio!ls in Annex ;\ hereto} as dcilncd h.::low:

(n:1 "r:!=:WHlH'In Stock" means the (,.'I~\mn](1n sic>.;:k, par \'Hlui.' $\. J P<.'f share, of th~~

Corporation.

(l~) ".Q.h~jc!(',lld f\.lvmenl D..11t.£" HI<::ms IF",'j'I"lHlry 15, \1i1~ J5,'\ llgU::,1 15 and

Nl1vemhcr )51 of each \';;:';11·.

(e) "Ju,I.l.(P[,';';l(!£.~:" me-'IIl"> lhe Common 'slO{')(, lln"iNt titles {!l £lny exisfil1g Junior

S'It!..:};! "uld any d't'f (lass ur scri¢~;)f :5K<~k ·;~,f the (·0l1i-<"riltil)u til;: kerns {~f" tllch e\.pr~'ssJy
provide that it rdnksjunior to Designated PrdlTrcd Stoek as \I) dividend rights and/or [1", t(l rights

on liquidation, dissolmloll or winding up of the (\,rponuiun.

(d) '-Uqllida!l\.JIl i\mount" mC1UlS Sl t,000 I) per sh"ue or Designated Prcf"errt,d Stock.

(c) "Minimum Amount" meW1S SIJl1sert S llmount equal to 25% (~lthe aggregate

I'allle ofthe Desixnated Prefl'l'retl Stock i.'1suetl (JfI the Origifltlllssue Date],

(J) "Parit", Slock" means any class or series OfSlock ofthe Corporation (other than

Designated Prcicrn:d Stock) the terms ofv,,-hich do not expressly provide that such class or series

will rank senior or junior to l)ljsignated Preferred Stock as to dividt:nd rights amL!or as to rights

on liquidation, dissolution or ~·inding up ofthe Corporation (in each case without regard to

whether div'ldends accrUt; cumulatively or nOll-cumulatively). Without limiting the foregoing,

Parity Stock shall includl,:; rhe Corporation's Ilmert litle(\") ofexisting clas\'es or series ofP(Jri~r

SlackJ.

(g) "5 igniflf..! Date" mealls [Insert date (~lllpplicable securities purchase oxreement].

Part. 4. Certain Voting Matters. !To be inserted iftfte Charter propidesfor poling in

proportion to liquidation preferences: Whether the vote or consent ofrhc holders of a plurality.

majority or other portion ofthe shares of Designated Preterred Stock and any Voting Parity

Stock has been cast or given on any matter on ..vhich the holders ofshares ofDesignated

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

specitied liquidation amouDt ofthe shares voted or covered by the consent as if the Corporation

\vere liquidated on the record date for such vote or consent, ifany, or, in the absence ora record

date, on the date for such vote or consent. For purposes ofdetermining the voting rights ofthe

holders of Designated Prefcncd Stock under Section 7 ofthe Standard Provisions forming part of

this Certi:l1cate of Designations, each holder ,viI! be entitled to one vote f()r each $1,000 of

liquidation preference to which such holder's sbares are entitled.] [To he inserted ifthe CluIJ1er

does !lot prm'idef()r voting ill proportion to liquidatioll prefereJlces: Holders ofshares of

De~ig:nated Preterred Stock will be entitled to one vote tix each such share on any matter on

which holders of Desig,natcd Prelencd Stock are entitled to vote, 'lJlduding any action by written

consent.I

[Remainder VfPage InfenliOfI1lI(v J..eft Blankl

If b511c:r d.;~irt'~ ,,) is.>llC ;:hp.r~;.: Wilr: <\ 'liglet;;:r d',\lbr u(;o(in1 liqtlid'rlh:.n prd~'Tel}<':;;, :,,!uid8tioll ~lr(;f:'l'cnce

:~krenn.:, will bo: m0~bi0J (ll',:',:-r6uglv. il1 ~lId'l c'[h' (in a('C;~lrJIUK{, lVit~· S<:'.di,'l! ..1."' i.lf t'I(' S<::~u~'!Tjc~

PW·Ch.lSG ,,\ ~'T(:c;ni:Jll). rh~' i%'.lc,r wii! b..~ (C;'cl~jin:d io cu~c: in,';l uep..HiT '1-.~r.;x'IT;~1lt.
IN WITNESS \\l-lEREOF. 11f1.\'erf namc ofell/florationl has cau:icd thi:> Certificate or

L)c:->ignations to be signed by r-J- its [-1, this l-J d<l) uf[-I.

IJll.\'crf name o(Corporation]

Ily,

Name:

Titk:

3
ANNEXA

STA'iIlARIlI'ROVISIONS

S~dion 1. Geller,!1 Mallex~. Each share of Designated Preferred Stock shall be identical

in all respects to every other sbare orrksignated Preterred Stock, rhe Designated Preferred

Srock shall be pcrpcmaL subject 10 the provisions of Section 5 ofthcsc Standard Provisions that

f~lfm a part ofthe Certificate of Designations. The Dcsiglliltcd Preferreu Stock shall fank equally

y,·irh 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 \vinding up of the

Corporation.

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

Slock:

(a) "AJmljcable Di'vidend Rate" means (i) during the period from the Original Issue

Date to, but excluding, the first da:y ofthe first Dividend Period commencing on or aner the fifth

anniversary ofthe Original Issue Date, 5~/;' per annum and (ii) from and after the first day ofthe

first Dividend Period commencing on or after the tifth anniversary ofthe Originallsslle Date,

9% per annum.

(b) "Appropriate Federal Banking Ag£!!ll" means the "appropriate Federal banking

agency" with respect to the Corporation as detined in Section 3(q) ofthe Federal Deposit

l.nsurance Act (12 U.S.c. Section J813(q», or any successor provision.

(c) "Business Combination" means a merger. consolidation, statutory share exchange

or similar transaction that requires the approval ofthe Corporation's stockholders.

(d) "Business Day" means any day except Saturday, Sunday and any day on \vhich

banking institutions in the State orNew Yark generally' are authorized or required by law OT

other governmental actions to close.

(e) "lhlaws" mcal1~ the h),luws of the Corporatioll, as they may be amended from

lime to time.

In "Certificate of ~sie.nations" means the Certiticale of DcsignalinJls or comparable

instrument relating l'\) the Designated Prderred Srock, of-vvhkh these Stancbrd Provisions flmn a

parl, as it may be amended ti·om time to time.

t~) "Lh8rt;;:r" means the Corporation'S(:<:':rtiticate \)1' m1ic.ks (,f incorporation, articles

uf assol:iation, (II" similar orgnnizalional ducumenL

il.- r
(1-:) '·OriQinallssUi.: Date" means the dale on which shares nf Desigmlted Pretc11'eJ

Sh1ck arc first issued.

(I) "Preferred Dirl.'Ctor" has tbe meaning s(;'t forth in Section 7(b).

(m) "Prefi:rrcd Stock'- means <lny and all series of preterred stock of the Corporation,

including ttIC Designated Preferred Stock.

(n) ·'.Q.ualit1ed Equity OlTi:.'ring·' means the sale and issuance for cash by the

Corporation to persons other than the Corporation Of any of ib subsidiaries aJlcr the ()riginal

Issue D;:lte orshares of perpetual Prcfl:rn::d Stock, Common Slock or any combination or such

stock, thaL in each casc, qualify as and may be included in Tier 1 capital ofthe Corporation at

the time ofissuanct': under the applicable risk-based capita! guidelines of the Corporation's

Appropriate Federal Banking Agency (other than any such sales and issuances made pursuant to

agreements or arrangements entered into, or pursuant to fimm(;ing plans \vhich "vcre publidy

announced. on or prior to October 13. 2008).

(0) "Sh,are Dilution Amount" has the meaning set forth in Section 3(h).

(p) "Standard Provisions·' mean these Standard Provisions that form a paJ1 ortile

Certificate of Designations relating to the Designated Preferred Stock.

(q) "Successor Preferred Stock·' has the meaning set forth in Section 5(a).

(r) "Voting Parit\' Stock" means, with regard to any matter as to which the holders of

Designated Preferred Stock are entitled to vote as specitJcd in Sections 7(a) and 7(b) ofthese

Standard Provisions that limn a part ofthe Certificate of Designations, any and all series of

Parity Stock upon which like voting rights have been conferred and afC t':xercisablc with respect

to such matter.

Section 3. Dividends.

(a) Rate. Holders of Dcsign<ltcd Preferred Stock \hall be entitled to receive, on each

share of Designated Prelr::rred Stock ii: as and when declared by the BO<ll"d of Directors or allY

July authorized committee ofthe Board oflJircctors, but only nut of assets legall:y available

Iheretl..1r. cumulative cash dividends with rc~ped to each Dividend Period (as defined below) at a

rate per annum equal hl the Applh:-nb!c Dividend Rate on 0) the Liquidation Amount per share of

Designated Prel;cneu Stock and (ji) the amount of accrHed and unpaid di\iJcm!5 for any prior

Dividend Period on such share ()fDcsignated Prekrrcd St(\ck, iL.tny. Such dil'idends shall begin

to accrue and b~ cumulative from the Original Issue Dale, shall compound on c;lch subsCI.IHcm

Dividend Pclymt'nt Date (i.I:.• 1W Jiyidt:'nds shall ac(~ru(' Dn I,\{ht;f divid.:nd., unless and until the

first Di,' iJ-clld Paymcn! Dail.' for sud) oth~T dividends l]:;l~ passc-d v.-itlli.'lll swh olhr::r .ii\, ideuds

h,wing l"lt'en paid on such date) and shnll he pLlyablc quarterly in nrre\:lrs un each Dividend

Payment Date, commclh.:ing \-vith thelir,,! ~L!ch Dividend Payment Dati: I{I (KCnr at k~H 20

e~knJ<'lr d;t.¥" ::dkr th~ Origilwt [<;SU(; D'lh:~. In iht, e\ enl that ,wy Dividend Paym-:m Date \"otJJd

othcf\\j~e litlll,'1"l a JdY that is noT a Iksines'j D,l:', 11'\e dividi..':lJ pa.vmi.:'nl' dw: OJ) that dak >~ill ht:

j.;o5rplm..::c! tll tht; H',:"xt day ;h..)l is:] Hu<;in(:'is Day Z1:nd no :JJJili(~nal divkkT:d, wilf i;h~crue <'b a

re'Hllt ofthut POs,p'";llem<;;HL The perL~d h'nm and in;:bdir:g ,my D("id~'nd Pd)'tllcm D;ne w, bUI

.., i,"".
excluding, the next Dividt:nd Payment Date is a "Dividend I~exiod", provided. that the initial

Dividend Period shall he the period hom and including: tile Original Issue Dilte to. but excluding.

the next Di,;itknd Payment Dale.

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

Period shall be computed on the hasis ora 360~day year consisting l1ftwelve 30-day monlhs. Th~

alllount or dividends payable nn Designated PreJt:rrcd Stock on any dale prior to the end of a

Dividend Period. and for the initial Dividend Period. shall be CllmpU{cd on the basis ora 360-day

year consisting oft\\iclve 30-day months, and acl1Jal days dapsed llver a ]O-day month.

Dividends tJwt arc payable on Dcsigna[ed Preferred Stock on any Dividend Payment Date

will be payable to holders ofrecord of Designated Prcterred Stock as they appear on the stock

register of the CorporJtjoll on the applicabk record date, which shall be the 15th calendar day

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

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

than 60 nor tess than J0 days prior to sllch Dividend Payment Date (each, a "Dividend Record

Date"). Anv such day that is a Dividend Record Date shall be a Dividend Record Date whether ~~-~ - - or not slich day is a Business Day.

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

payahle in cash, securhies or other property, other than dividends (if any) declared and payable

on Designated Preferred Stock as specified in this Section 3 (subject [0 the other provisions of

the Certificate of Designarions).

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

remains ollt<;tanding, no dividend or distribution shall be declared or paid on the Common Stock

or any other shares ofJunior Stock (other than dividends payahle solely in shares ofCommon

Stock) or Parity Stock. subject to the immediately lollo\ving paragraph in the case of Parity

Stock, and 110 Common Stock, Junior Stock or Parity Stock shall be, directly or indirectly,

purchased, redeemed or otherwise acquired for consideration by the Corporation or any of its

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

latest completed Dividend Period (including, ifapplicablc as provided in Section 3(a) above,

dividends on such amount). on all outstanding ~harcs of Designated Prefem,~d Stock hav~ been or

arc c.oniemporaneollsly d~clared ami paid in full (ur have been declared and a SlIJn sufIicicllt for

the paylnem thereof has been ,"Sct aside for the benefit ofthe hokkrs ofshart;s of Designated

Prdcrred Stock on the applicable record date). Th~ foregoing limitation shaH not apply to 0)

redcmptions, purchases or otber acqHi::;itlons ofshares ofCommOil Stock or otber Junior Stock tfl

connection \\,ith the administration ofany employee ben('fit plan in the ,'rdinar)' course of

business {including purchases to t"lifsd thc Shaft: Dilution l\mount (a" dd"illixl bdl.}\\) plJrsuant

to a pnhlidy ant1('unccd n::pur(h~~')c plan) i.11ld consistent with past practice. prol'ldcd (hal any

pllrcha~es t.O "fbet the Share LJirlltiOJl ,\monnt ~haj[ in JlO Ch'nt t.'x';::~~l:J the Share Dilution

,\nK'llllt; fii) pllJ'c:hascs ('r (){her acqui:->ll.il'I1S b~, a brpk~f-;Jeak:r "uh~idiary ;}fthe ('Np,}ratiol1

solely rl~r lhe pUrpiJSi.:' ofrnarKd-llIaking, ~lahiJi;:ali\m or cUSlomer J;jeJliwtion transJeti,)ns til

Junior SclO(:K ....'[ PJnty Stuck in jh~ ('rdil\ar.y l~l)ll1"Se (}f"its businc:"..s: (iii) pun;hase" by n hn.'kcr·

dC:ller sub$idi[u·y of the Corp'Yfali.:.n of cJpilal sto.:.:k orlit.: Cvrponnl0fl tl)f resale pursuant to an

ofi"i:rll1g by the Corpt'ratkm of ~:J(;ll ulpild ~t('(k llnd~rwriHcn1':,,"' Slh.:h bnlkcHJ('.aJer sllbsjdiary:

1,1\1) any di"'ldcnJs ()t. di5~ribilli(l:)'i d rig!H" or Juniu{" ";;tock in i,:onnt'l"ti<m widl a sjDc:kh\~,}dc.r:'>·
rights plan (ir an)- redemption or repurchase of rights pursuant to any stockholders' rights plan:

(v) the 3cqlllsition by the Corporation or any of its sub:-.idiarics ofrecord ownership in Junior

Swo;;k or Parity Stuck forthe beneficial t.lwnership OrallY other persons (other than the

Corporation 01' any of its subsidiari~s), including as truslees or custodians: and (vi) the exchange

or convcrsir,n of Junior Sto;;:k tor or into oth~r .Iunior Stock or of Parity Stock for or into other

Parity Slock (wilh the- s.::i.mc or lesser aggreg8te Iiquidati('l1 amount) or Junior Stock, in ca(:h ('ase,

solely to the l.:.'xl("nt required pursuant io binding contractual agreements entered into prior to the

Signing Datc or any subf.lequcllt agreement for th(: accelerated ex~rl.'ise, settlement or exchange

thereof for C0l111l1()11 Sto(:k. "Share Dilution Amount" means th~ increase in the number of

diluted shares Otll~ujlldiJlg (ddermincd in accordance \vilh generally accepted accOlll1ting

principle"> in the United Statcs, and as measured n'om the date ufttIe Corporation·s eonf.lolidatcd

financial statements mosl recently' filed with the Securities and Exchange CommiSSion prior to

the Original Issue Date) resulting from the grant vesting or exercise of equity-based

compensation to o:mployees and equitably adjusted for any stock split, stock dividend, reverse

stock split, reclassification or similar transaction.

\\llen dividends are not paid (or declared and a sum sufficient for payment thereofset

aside tor the benefit ofthe holders thereuf 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 \vithin 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 and

payable 011 stich Dividend Paymcnt Date (or, in the ease of Parity Stock having dividend

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

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

that the respective amounts ofsuch 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 umoulH) and all

Parity Stock pay'able on such Dividend Payment Date (or, in the case afParity Slock having

dividend payment dates different from the Dividend Payment Dates, 011 a dividend payment date

:fi:lIling \v'ithin the Dividend Period related to f.llJ(;h Di'",idend Payment Date) (subject to their

having been declared by the Board ofDirectors or a du!y authorized committee ofthe fiourd of

Directors out of legaUy available funds and including, in the case of Parit)' Stock that hears

cumulative dividends. all accrued but unpaiJ di\ridends) bear to each other. fl"lhe Board of

Directors or a duly authorized committee oftht Board of Directors determines not 10 pay ,my

dividend or a filll dividend on a Dividend Pa),menl Date, the Corporali{llJ will pnwidl' v,Titten

notice to the holders of DC'signated Preferred Stoc!.; prior to SlKh Dividend Payment Date,

Suhjed to the ri.lregoilJg, and l1ull)l.hcrwi::>e, such dividends (pa~ able in t:ash. se(,;uritics or

other prope-rt)') as I1wy be dclerrnint;d by the B(,arJ uf Dircc!0rs or any duty mnJlOrizecl

committee (11' the Bc'arJ ('f Director" llW)' tx- declared and pHid (In any st'-l.:Urilies, including.

CmllJn(\l1 Sto(k and (·tIler Juni,)r ShK:h:, th.lIT1 timC' ttl time '<Jut of any funds legal I)' available f(:'l

sHeh payment, and hlJidcr~ of Dc<,:ig!1Dted (l;C"h.:rn:.'d Stoc!\: shall not be emrtled to ~'arti:::lpal~ m

any ~uch dividend..;.
(a) y'.Qluntary or lnvoluQ!;JI"v liquidation. In the event of any liquidation, dissolution

or winding up oflhc afbirs nrlhe Corporatiun, \vhdher voluntary or involuntelry, holders of

Designat~d Preferred Stock shall he enlitk",! to receive l()f each sbmc of De."ignmed Prdcrn:.'d

StocL Out of the assets ofthe Corpnl"ation or proceeds tfJereof (1,.vhcthcr capital or ~urpills)

dvui lab Ie f(x distrihution 10 stockholucrs or the Corporation, subject to the rights of any creditors

ofthe Corporation, before any distribution ofsuch asseis or proceeds is made 10 or set aside 1\'\r

the holders ofCommon Stock and any other slock urthe Corporatlon ranking junior to

Designated Preferred Shxk 3S to such distribution, payment in hill in an aillount equal to the sum

01" (i) the Liquidation Amoullt per share and (iii the amount ofany accrued and unpaid dividends

(induding, if applicable as provided in Section 3(a) above, di\'idcnds on such amount), whether

or not declared, to the date ofpaymcnt (sLlch amounts collectively, the "Liquidation

Preference").

(b) Partial Pavment. Ifill any distribution described in Section 4(a) above the assets

ofthe Corporation or proceeds thereof are not suflicient to pay in full the amounts payahle with

respect to all outstanding shares of Designated Preferred Stock and the corresponding amounts

payable \vilh respect of any othcr stock: ofthe Corporation ranking equally with Designated

Preferred Stock as to such distribution, holders of Designated Preferred Stock and the holders of

such other slock shall share ratably in any such distribution in proportion to the full respectivl.:

distributions to which they are entitkd.

(c) Residual Distributions. Ifthe Liquidation Preference has been paid in full to ali

holders of Designated Prefen-cd Stock and the corresponding amounts payable v.,ith respect of

any other stock ofthe Corporation ranking equally with Designated Preterred Stock as to such

distribution has been paid in full, the holders of other stock of the Corporation shall be entitled to

receive all remaining assets ofthe Corporation (or proceeds thereof) according to their respective

rights and preferences.

(d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes ofthis

Section 4, the merger or consolidation of the Corporation with any other corporation or other

entity, including a merger or consolidation in which the holders of Designated Preferred Stock

rec~ive cash, securities or other property tor their shares, or the sale, lease or exchange (t(lJ" cash,

s~curitics or other property) of all or substantially all of the assets ofthe Corporatinn, shall nor

nmstituie;;J liquidation, dissolution or winding up ofthe Corporation.

Section S. RedcmpliQlJ.

(a) Dlltional Rt::dernmjol1. Ex(;(:pt as provided b<,low. the Designated Preferred Stock

nm) 1101' Ix: redeemed prior to the rir~t Divick',lld Payment. Date hlliing on or after the third

alHli\ ersary orthe Original Issue Date. On \,\r a1ter the tir.st Dividend Paymeol Dat<.' JaIling nn or

3itel' the thit·d anlll\\,,'t'sary ofthe Origin'll JS~L1e Dale, till.' Cmpur<ltiptl, at ib d[1tir'l1, sul~jc;,::t to the

approval <Jfthe ,\pprnpria[(' federal Banking\gency, m<l:- rt:-dt'elll. III whole ~\r in pa11, HI lin)'

time and from timt~ l,u time.. out of t"tmds legnlly available [hereff')]", the shdfes of DeStgn3kc

hCI'cncd :5tc·;,.·l aot the lime out.>;l.anding, upon Hf'li':e giV,-',fl a~ prl)v;d~d lH Se(;:lon 5«:) below, elt a

redempti,:m price equal [(\ the "lim uf(i) the Liquidation Amount j1(;r "hHr,~ iUI":! (Ii) e:,>.c:~pr as

I.,then:vise provided bdow, uny ~t'.;cnlcd and unpaid dhidcllJs (including. if applkable as

:\--'
provided in Section 3(a) abmc, di",idend.s Oil such arnount) (regardless orwhdher any dividends

are actually declared) to, but excluding, the date fixed for redemption,

Notwithstanding the foregoing. pnor TO the tirsi Dividend Payment Date falling un or

after the third annivcfsnry ofthc Original ls~ue Daie, the Corporation, at it::; option, subject to the

approval of the Appropriate l,'cderal Banking Agent:y, may redeem, in whole (y in parL at any

time and from time tll time, the shares of Designated Preferred Stock at tbe time outstanding,

upl)Jlnoticc given as provided in Section 5(e) below, at a redemption price equal to the slim of (i)

the Liquidation Amuunt per share and (ii) except as otherwise provided below, any <lccrut:d and

unpaid dIvidcnds (including, if applicable a-.; provided ill Section 3(a) above, dividends on such

amount) {regardless or whether any divid~nds arc actually declared) to, but excluding, the date

fixed for redemption; provided that (x) the Corporation (or any successor by Business

Combination) has received aggregate gross proceeds of not less than the Minimum Amount (plus

the "Minimum Amount" as defined in the rekvant certificate of designations lor each other

outstanding series of preferred stock ofsuch successor that was originally issued to the United

SMes Department ofthe Treasury (the "Successor Prelerred Stoek'-) in connection with the

Troubled Asset Relief Program Capital Purchase Program) from one or more Qualified Equity

OlTerings (including Qualified Equity Offerings ofsuch successor), and (y) the aggregate

redemption price ofthe Designated Preferred Stock (and any Successor Preterred Stock)

redeemed pursuant to this paragraph may not exceed the aggregate net cash proceeds received by

the Corporation (or any successor by Business Combination) from such Qualified Equity

Offerings (including Qualifted Equity (}ITerings ofsuch successor).

The redemption price for any shares of Designated Preferred Stock shall be payable on

the redemption date to the holder ofsuch shares against surrender ofthe certiticate(s) evidencing

such shares to thc Corporation or its agent. Any declared but unpaid dividends payable on a

redemption date that occurs subsequcnt 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, btlt

rather shall be paid to the holder ofrecord ofthe redeemed shares Oil such Dividend Rct:ord Dare

relating to the Dividend Payment Date as provided in Section 3 above,

(b) No SMiling Fund. The Designated Preferred Stock will not be subject to an)

mandatory redemption. sinking fund or other similar provisions. Holders of Designated Preferred

Stock will have no right 10 r~quire redemption or repurchase of any shares of Designated

Preferred Stock.

(e) N()tic~~of R~dclll.l~!-ioll, Nnticc of,-,\'cry rl'dernpTion ofshares or Designated

Prcfern::d Stm.:k shall he gi'vcn by fk"t dass mail, p,lsfage prepaid. addressed to the holders of

I'ccord ofthe shares to be n::dccmcd ~lt their respcelivt.' last addrc.':.';cs <lppearing; on the books of

the Corpordtion. Such mailing shall be at lca:.;1 30 days and 11<::'[ more liMn 60 da)5 before the date

IixeJ for redemption. Any notic..:" IYHlikd :lS j.ll'\H'ided in this Subs<;ction shall he conclusively

presumed 10 have bt:<::ll duly gin:n. \\ hcthcr N nOf the holder l"t,cei"es su::.,h n;:nicc. but f:lijure

duJy to giVl.., such BOlio,: by t:Jail, or any dc:lectin ~uch !11)ti..:t: (If in tht' mailing tlwreoC tU'lll.y

hold.::r oj' "hares of Desigll..neJ Prdt'Tll:"d ~lock designated fi)r redemption :-;hall HOt o\Ht::Ci the

v,didity ('[[hI;;' pr,1Cc(',l'ings for the rl.xll.:Ulj1rion oLut) (.flher shares ofDesigni.1ted l'rdeul,d Stock.

\niwith;:;;t:m~llng the l()rt~guing, d' shar~s (If' D.;.sigllillcd Prd::-.rred Stock :Ln:i~SiJ\:J in t'!or'!i.A,'ntry

k,rm lhnlHgh f'::e Dq1OSi:ory Trust COJ1)p,my ,'1" an.\, ,'lher si/nilar J:ld:il.v, r'l',:,tice (,fredclllptilm

,\ ..(
may be given to tbe holders or Designated Preferred Stock at such time and in ilny manner

permitted roy such t~lCility Each notice of redemption given to a holdel' shall state: (J) the

redemption date; (2) the numher of shares or Designated Pretcrred S{,lck to be redeemed and, if

less than aJi the shares held by' such holder are to be redeemed, the 11 limber ofsuch share:'> tn he

redeemed from such holder: (3) the redemption price: and (4) the place or places where

certi1icillcstjx such sh;lrcs arc to be slllTendcred for payment orthe redemption price.

(el) J~~1jQ-l ReJI~nption. In case ofany redemption of pnrt ofthl: shnrc~ of Dcsignakd

Prererred Stock at the time outstanding, the shares to be redecmed shaH be sclectnl eilherpro

rata or in such other manner as the Board of Directors Of a duly authorized committee !hercof

may determine to he fair and equitable. SlIbjcct to thc provisions hereof: the Board of Directors

or a duly authorized committee thereof shalJ have full pmvcr and authority to prescribe the terms

and conditions upon \vhich shnres of Designated Preterred Stock shall be rcdcemcdfj'om tim!; 10

time. IftCVI·er than ali the shares represented by any certificate are redeemed, a new certifkate

shall be issued representing the unredeemed shares "vi[hout charge to the holder thereof.

(e) .EJIcctivencss ofRcd~mption. If notice of redemption has been duly given and jf

on or hefore the redemption date ~pccitied in the notice all funds necessary for the redemption

have been deposited by the Corporation, in trust for the pro rata b(.'l1efit ofthe holders ofthe

shares called for redemption, with a bnnk or tl'llst company doing business in the Borough of

Manhattan, The City ofNew 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 theretor, then,

nohvithstanding that any certificate tor any ~hare so called for redemption has not been

surrendered tor cancellation, on and after the redemption date dividends shall cease to accrue on

all shares so called tor 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 ofthc holders therc,)fto receive the amount payable on

slleh redemption tj·om such bank or Imst company, without interest Any funds unclaimed at the

end ofthree years from the redemption date shall, to the extent pennittcd by Imv, be released to

the Corporation, atter which time the holders orthe shares so called tor redemption shaH look

only to the Corpomtion for payment of [he redemption price ofsuch shares.

(t) Status ('{Redeemed Shares. Shares of De~ignatcd Preferred Stock that are

redeemed, repurchased ()T otherwise acquired by the Corporation shall revert to authoriLed but

unissued shares ofPreicrred Stot;k (provided that ::my such cancelled shares of Designakd

Preferred Stock Illay be reissued only as shares of;my scries of Prclcrred Stock l)ther than

Desigmned Preferred Stock).

Seclion 6. Conn;r."iqn. Holders \lfDesignated Prefen-cd SkX:K shares shaH haw lW right

to exdwngt:: IX (elm,ert such share,s into an) other securities.

Section 7, ""'"'ling R:ig,hb.

~,;() iIcl1l','raL Th~ h"lder.'> (,I' Designated Preferred ~!O..;h shall not h~wc an} 'Otiflg

rights except a,.., sd: finIh belol.' or as olltt'mis.1." from lime t(' time required by taw.
(b) preferred Stock Directors. Whenever, ilt any time or time", dividends payable on

the shares of Designated Prcfencd Stuck have not been paid for an aggregate ofsix quarterly

Dividend Periuds or more. w'hclhcr Dr not consccmive. the authorized number of direi;tors of the

Corporcltion shall automatically be increased b) two il1ld the holders oftiJeDcsignated PreJerred

Stock shall have the right, with IwhIt:rs ofshares of any nne or more other classes lW series of

Voting: Parity' Stock outstanding iH fhe- time, voting together as a c!as:->, to elect 1\\'0 directors

(hewnaHer the "Preferreg Directors" and each a "Preferred DifCl.:tor ") t(l nIl such new!)

created directorships at the Corporation's next annual meeting nf stockholders (or at it special

meeting caJJed tor that purpose prior to SUdl next anmwl meeting) and at each suhsequent anllual

meeting ofstockhoJders until all accrtled and unpaid dividends for all past Dividend Periods.

including the latest completed Dividend Period (including, if applicable as providt.:d in Section

3(a) above, dividends on such amount). on all outstanding shares of Designated Pn:rerred Stock

have been declared and puid in filiI at whid, time such right shall tenninate with respect to the

Designated Preferred Stock, except as herein or b)' law expressly provided, subject to revesting

in the event of each and every subsequent default oCthe character above mentioned; provided

that it shal! be a qualification it'!" election for any Preferred Director that the election OfSllCh

Pretern::d Director shall not cause the Corporation to violate any corporate governance

requirements of allY securities exchange or other trading facility on which securities ofthe

Corporation may then be listed or traded that listed or traded companies must havc a majority of

independent directors. Upon any termination ofthe right of the holders ofshares ofDesignarcd

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 tenn of office of aU Preferred

Directors then in ofticc shall terminate immediately and the authorized number of directors shall

be reduced by the Humber of Prete-rred Directors elected pursuant hereto. Any Preterred Director

may be removed at any time, 'with or without cuuse, and any vacancy created thereby may be

filled, only by the affirmative vote ofthe holders a majority ofthe shares of Designated Preferred

Stock at the time outstanding voting separately as a class together \vith the holders ofshares of

Voting Parity Stock, to the extent the voting rights ofsuch holders described above are then

exercisahle. Ifthe office or any Preten'cd Director becomes vacant ttlr any reason olln;:r than

removal from ofJ'ice as aforesaid. till;: remaining Preferred Director may choose a successor who

shall hold ofnce fbr the unexpired term in respect ot"\vhich such vacancy occurred.

(c) Class Voting Rig,hrs as to Particlilar Matters. So long as any shares of Desjgnated

Prcterred Stock arc outstanding. in additiclJ1to any' oth.:r vOle or consent ofstockholders rCtluircd

by lmv or My the Charter, the vote or consent ofthe holders of at least 66 213% ofthc shares of

Designated Preferred SlOCK at the time outstimding, \'uting as a separate class, given in person or

by proxy. either in writhlg without u meeting or by vute at any meeting called it,r the purp':lse,

..;hall bie nC(;~SSflry tiJr cn't.'cting (\r validating:

(i1 !\}li!wri~;ltjsm.(~L\~ni9.I~~!(~cA. A.. n~ ~lmendmcnl or ahcration \lfthc

Celt; licate oflksigndtions fl,-,r tht' Deslgnmcd Prc!('J"l'ed S!m:!-: ~)r the Chnrtcr f(; authorii::c

N crC:lk: l)l" incre:lsc the authorized ammml of: dl' any i:,,:;uarK,e lyf: ,.my shares or. or dUy

s<"tlJrilics convertibie inin uf l:xchang~ah!eor e:\crcisabl~ 1()1' share:, o( ~my c hb,) or serie"

ot"r.:;;lpital ,;tul'k ufthe ("o1"po1':'I.\IOI1 ranking senior t~) Dc<;ignated Prden'e-d SH:ll:k \\-ith

fC"pC.....t to etllwf or horh lhe P~I~~U\l.'nt ()rdividends an(//nr the di,stributif'l1 uf a.'\.sets ,)0 any

Jiquidati,)o, dis'!l}!Ulioil c'r windillg up of the C'ur[hll'<tti(m:
(ii) .1:m<;lldment of Designared Prc'rcrred Stock. !\ny amendmeni. alleration

or repeal of any pruvision oftlle Certificate of Designations for the Designated Pretc!TI:d

Stock or the Charter (including, unless no vote on sw:h merger or consolidation is

reqnired hy Section 7(c)(iii:! belmv, allY amendment, alteration or repeal by mc;ms of a

mcrger. (;ol1solidation or otherwise) so as to ad"cr.",..:ly affect the rights, preferences,

privileges Of voting powers ofrbc De')ignatcd Preferred Stock; or

(iii) Share Exchanges. Rscl3ssifi.gtioD-). 1\krgers and CQllsoljdatigm. Any

consummation ofa binding share exchange or rccl<lssitication involving the Designated

Prderred Stock. or of a merger or consolidation ofthe Corporation ,vith another

corpnfatinn or oLher entity, unless in each case (x) the shares of Designaled Preferred

Stuck remain otlt!jtanding or, in the case of any such merger or consolidation with respect

to which the Corporation is not the surviving or resulting enti!)', arc converted into or

exchanged for preference securities ofthe surviving or resulting entity or its ultimate

parent, and (y) such shares remaining outsL.'mding or sllch preterenee securities, as the

case may be, have such rights, preferences, privileges and voting pm-vcrs, and limitations

and restrictions thereat: taken as a whole, as are not materially less tavorable to the

hoJders thereof than the rights. preferences, privileges and voting powers, and limitations

and restrictions thereof of Designated Preterred Stock immediately· prior to such

consummation, taken as a whole;

provided, hownCT, that for all purposes ofthis Section 7(e), any increase in the amount ofthe

authorized Preferred Stock, including any increase in the authurized amount of Designated

Preferred Stock necessary to satisfy preemptive or similar rights granted by the Corporation Lo

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 othcf\vise, of

any other series of Preferred Stock, or any securities convertible into or exchangeable or

exercisable lor any other series or Preferred Stock, ranking: equally with and/or junior to

Designated Preferred Stock ,,,,,ith respect to the payment of dividends (whether such dividends

urc cumulative or non-cumulative) and thc distribution of assets upon liquidation, dissolution or

winding up of the Corporation will not be deemed to adversely aJ1cct the righb, pretcrcnces,

privileges nr voting pc'\"ers, <lod sh:.lll not require the affirmative voLe or conscnt of the holders

of olltstanding shares ofthe Designated PrelCrred Stock.

(d) Chanl.!.cs ufter Ptovision fix Redemption. No vote or consent ofthe holders 01"

Designated Preterred Stock shall be required pursuant to Section 7(e) above if, at or prior to the

time 'iNhen any such vote or consent \".·oulcl otllerwise b<.: r(~qujred purswmt to stich Section. all

Otlhlunding shares ofthe Designated Preferred Slock s.haH have been redeemed, or shaH have

beclJ calbl for retlcmplii1Jl upon prnpl'( notice dnd sufficlCnt funds shall h,ne been deposited in

lrust for su.:.·h redemption. in each case pursuant to SCCtiilll -" ahOH~.

1.1:) I'r~h':~9JlrCj f(-)r-'y_utiillL;V:'SLColl~'i£m5. ]'he ru\~'s ilml pnx:cdun.:s ll)f .:alling and

;:onductiJJg any mC,:;ling of the lwldcfs ot"Dcsignilll..·d Pn;,'lt~rred SllKk (induJillg, with(1tl1

limitation, the thing ufa record datt.: in conl1cl'tion thl'rewith). th~ "olicirati',l1l rl.lld use ofpn)xi.:s

at sUi..:I, a meeting, tIll: ()biaining nfwriucn C,)llsenL" and any 01f1(;:1" aSpcc,ll)1' ma11er wiLh regmd l(\

','uch ::. Illiu'('ting or sm:h Cl'nsent", shaH be gOh~!TIed by ,my ruk... <If the Bua;·d uf Dirt.'<..,tl)r', Ot· illl)

doly dtilhc1ri'lcd ('.o'llmill.i.~e pt'lll..: Bc.:i1rJ L'f DJ:eChll"'i. 10 it:; ([i:.:crclioll. may ad'Jpt fnml ,ime to
time, whicb rules and procedures shall conkmn to the requiremems oflhe Charter, lhi?, Byla\..s,

and applicable law and the rules orany national securities cxchcmgc ur other tradltJg facility on

which Dc~ignated PretCrred Stock is listed or tHlded at the time,

Section 8, Reclmt Holders. To the fullest extent penniued by applicable law. the

Corporation and the transIer ngent tor Designutcd Preferred Stock may' deem and treat the ret:-urd

holder of any shure of Designated Prekrred Stock as the true and lawful o'wner lhen;ofthr all

purposes, and neither the Corporation nor such transtCr agent shall be affected by any notice to

the contrary.

Section 9. Notices. All notices or communications in respect of Designated Prekrred

Stock slwll be sufficiently given if given ill writing and delivered in person or by first clJSS mail,

postage prepaid, or if given in such other manner as may be permitted in this Certificate of

Designations, in the Chm'ter or B.ylaws or by applicable Jaw. Notwithstanding the foregoing. if

shares ofDesignated Preferred Stock afC issued in book-entry filml through The Depository

Trust Company or any similar fat.:ility, such notices may be given to the holders of Designated

Preferred Stock in any Jnanner permitted by such facility,

Section 10. No Preemptive Rights. No share of Designated Preferred Stock shall have

any rights of preemption \vhatsocvcr as to any securities ofthe Corporation, or any \-varrants,

rights or options issued or granted with respect thereto, rt:gardlcss of how such securities, or such

warrants, rights or options, may be designated, issued or granted.

Section 1 I. Replacement Certificates. The Corporation shall replace any mutilated

certificate at the holder's expense upon surrender ofthat certificate 10 the Corporation. 'l-he

Corporation shall replace cl;;rtitiea1cs that become destroyed, stolen or lost at tht: holder's

expense upon delivery to tht: CorporaLion uf reasonably satisfaclOry evidence that the certificate·

has been destroyed. stolen or lost, together with any indemnity that may be reasonably required

by the Corporation.

Section 12. OtherJ~ights, The shares of Designated Preferred Stoek shall not have any

rights, preferences, privileges or voting powers or relative, participating, optional or other special

rights, or qualifications, limitations or restrictions thereot 01ha than as set forth herein or in the

('halter ur 3.5 provided h:y applicable law.
ANNEXB

FORM OF WAIVICR

In consideration tor the benefits I will receive as a resull of my employer's participation in the

United States Department of the Treasury's TARP Capital Purchase Program, I hereby

voluntarily waive any claim against the United States or my employer for any changes to my

compensation or bo::nefits that arc required to comply with the regulation issued hy thl.:

Department of the Treasury as published in the Federal Register on October 20, 2008.

I acknmvleuge thnt this regulation may require modification of the compensation, bonus,

incentive and other benefit plans. arrangements, policies and agreements (including so~calJed

"golden parachute" agreements) that I have \vith my employer or in which I participate as they

relate to the period the United St.:'1tes holds any equity or debt securities of my employer acquired

through the TARP Capital Purchase Program.

This waiver includes all claims 1 may have under the laws of the United States or any state

related to the requirements imposed by the aforementioned regulation, including without

limitation a claim for any compensation or other payments J would otherwise receive, any

challenge to the process by \vhich this regulation was adopted and any tort or constitutional

claim about the ei1ecf of these regulations on my employment relationship.
ANNEX C

fORM OFJJPINION

(a) '111C Company ha'i been duty incorporated ,md is validly existing as a corporation

in good st~Uldjng under the laws oUhe stale of its incorroralion.

(b) The PrefeneJ Shares hm-c been duly and validly authorized, and, when issued and

ddin:rcd pursuant to the Agreement, the Preferred Shares will be duly and \'aiidly issued and

fully paid and nOI1*asscssablc, ,,,,ill not be issued in violation of any preemptive rights, and will

rank pari passII with or senior to all other series or classes of Prderred Stock issued on the

Closing Date with respect to the payment of dividends and the distribution of assets in the eycnt

of any dissolutioll. liquidation or winding up of the Company.

(c) The Warrant has been duly authorized and, \vhcn executed and delivered as

contemplated by the Agreement, "",ill constitute a valid ,md legally binding obligation of the

Company enforceable against the Company ill accordance with its temls, except as the same may

be limited by applicable bankmptcy, insolvency, reorganization, moratorium or similar Jaws

affecting the enforcement of creditors' rights generally and general equitable principles,

regardless ohvhcthcr such enforceability is considered in a proceeding allaw or in equity.

(d) TIle shares of Common Stock issuable upon exercise of the Warrant have been

duly authorized and reserved for issuance upon exercise of the Warrant and when so issued in

accordance \\ith the terms of the Warrant will be validly issued, fully paid and non-assessable

(insert, if applicable: . subject to the approvals of the Company's stockholders set forth on

Schedule C].

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

Agreement and the \Varrant and rinsert, if applicable: , subject to the approvals of the

Company's stock1101ders set [Olih on Schcdull.: C,l to carry out its obligations thereunder (which

includes the issuance of the Preferred Shares, Warrant and Warrant Shares).

(1) The execution, delivery and performance by the Company of the Agreement and

the WalTant and the consummation of the transactions contemplated thereby have been duly

authorized by all necessary corporale action on tl1c p;ui of the Company und its stockholders, and

no further approval or authorization is required on the Paft of the Company (inserl1 if

applicable: , suhject, in e~1ch case, 10 the approvals of the Company's stockholders set fOl1h on

Scheduler!.

ig:l The A.grecmwt is a v.a.lid and hinding obligation of the Company enforceableagulnsl the Company in acconiam.'i..' wH!J 1t<:: terms, except as the same may be limited by

applicable bankl1lj:'rcy. insolvency, rcorgfJnization. moratorium or si1.Hi1"r !a\VS ni'fectin~.~ th~

cnforcl:ment of creditors' righl.~ gClleral1:' ,::nd general t'qllitabl~ principles, rcgard1cs;;; of\yht'th{'l'

l'ul..'h ef1t\m:e~lhi!rty i" ,,:.onsiJ<:rcd III 11 proceeding at bw or in equity; pmvid",d, IlOrj't:ver, sut:h

l:ounsel need cxrn::ss no opinion with respect to Sccti('T! ·LS(g) or (h~ Sl~\·<.'.rahil'it~ pc()\-isions 01

t1~..:~ Agrer;-:l)entins(l13.r;J::i Sectien 4.5(g) is ('(Hlct"nled,
FORM OF WARRAJl:T

[SEE AHACHED]

ANl'EX D
ANNEX D

FOllM OF WAlmANT TO Pl'IlCHASF COMMON STOCK

THE SECURJTIES REPRFSFNTFD BY THIS INSTRUMENT lIAVE NOT BEEN

RHilSTERED UNDER TllE SECl:RITlES ACT OF 1933, AS AMENDED, OR TIlE

SECURIIIl'S LAWS OF ANY STAT[ A>(D MAY NOT ilE TRANSFEllRED, SOLI) OR

OrHLRW1SE DISPOSED OF EXCEl'!' WI!JLE A REGIS illATION STATEMENT

RELATING 'lHERFTO IS IN EHECT UNDER SUCH ACT AND APPLICABLE STATE

SECURI1lES LA WS Oil, PUIl,SUANT TO AN EXliMPTION !'Il,OM REGISTRATION

UNIW,R SUCH ACT OR SUCH LA WS, THiS INSTRUMENT IS ISSUED SUBJECT TO

Tll!' IU'SI RICTIONS ON TRANSFER AND OTHER PROVISIONS OF A SECURITIES

PURCHASE AGREEMENT BETWEEN THE Issr;ER 01' TffFSE SECURITIES AND THE

INVESTOR REEERRED TO THEREIN, A COPY OE WHICH IS ON riLE WITH THE

ISSUER, THE SECURITIES REPRESENTED BY THfS INSTRUMENT MAY NOT BE

SOLD OR OTHERWISE TRANSI'ERRED I'XCEPT IN COMPLIANCE WITH SAID

AGREEMENT ANY SALE OR OTHER TIl,ANSFER NOT IN COMPLIANCE WITH SAID

AGREEMENT WILL BE VOID.

WARRANT

to purchase

Shares of Common Stock

of _

Issue Date:

1. Dtjjnitions. Unless the context othcnvise requires, when used herein the

t()llowing terms shall have the meanings indicated.

"Alliliate" has the ml,,';aning ascribeu to it in the Purchase J\greemcnt.

".,lppraiMd Procedure" means a procedure wht.'rcby two illdepl::ndent appr8isers, one

dlllSCIl by the- Ciimpany and une hy the OriginBI W:.lrranthl>Jder. shall nlllfUally agree upon the

determinations then the subject of appraisal. Fat'h party shall ddiwf a notice TO the ot1lcr

arpoinling it:; appraiser \"'lthin 15 Jays after the .Appr~jsal Procedure is invoked. If\','i!hin 30

ljd;" aJr.:r ul'pointmt:nt (lethe hVo <.lPlwaist.'r:; liley are una hIe to agree upon th~ amount in

questiun, a third indepen(knt ilppmj.:;~r Sh;lH be dll,scn wilhin 10 day.;; IheR'afkr by the fHlIwal

(;,}J)sent of 5udl1irst (\1'0 <lppmiscrs. The d(;ci:siol1 (If the third appnli';;t'l" so app,)mted ;111d cho~en

shall bo.: ~ivea \vithin :'0 day.;; aftcr lhe selection of <:uch tbird i.lppr'-li:'>(;'r. Iflhrt-i; appraiser,I;, shall

b~' ai'p'.llnted dDd the defGnnimtti('l1 of Oil(' Hrpmiser is di"pamlt' !wllIlht In!ddle- d{:!cnninatioIJ

hy nXll't' rhan hvi(~e rh~' ,1iT/(lunl hy\\hich the nth.::!' deknllinati"tl is JispMate J:mrn IJJC middle

dc~er,nirlf\ti':ll" tben thi:' deknr,mali,"l[l 01" ~t.;ch appn,ls<;::l' <;lwlJ be ~x<.·-luded, the r,;;m~jining t"iW

ddt:rmin('.11:_JII~,..baH be J\craged i:1nd such iiver:1g", ~huJl b\;c' bindlll;;:': and cunc!usiyc llP<.\J1 {he
(\,mpiJl'l}' and tht' Original Warrantllolder; other\\-ise, the average (If all three dctemlinalions

"halt be binding upon the Company and the Original Warmntholder. The L:oslS ufcunducting

any Appraisal Procedure shall be borne by tl1..:.' Company.

"Board o/IJirecton" means. the board ofdirectors ofthe Company. induding any duly

authorized committee thereat:

''Business Combination" means a merger, consolidation, statutory share exchange ur

similar transaction that requires the approval urthe Company's stockllOldcrs.

-'!msiness (k~}''' means any day' except Saturd3Y, Sunday and any day on wJm:h banking

institutions in the State of New York generally an: authori7.cd or required by ),-HV or other

govcrnmental adions to close.

"Capital Stock" means (A) with respect to any Person that is a corporation or company.

any and all shares, interests, participations or Other equivalents (however designated) ofcapital

or capital stock ofsuch Person and (8) with respect to any Person that is not a corporation or

company_ any and all partnership or other equity interests ofsuch Person.

"CharIer" means, vvith respect to any Person, its certificate or articles of incorporation,

articles of associ alion, or similar organizational document.

"Common Stock" has the meaning ascribed to it in the Purchase Agreement.

"Company" means the Person whose name, corporate or other organizational form and

jurisdiction oforganiz3tion is set forth in Item 1 of Schedule A hereto.

"co/'ll'crsion" has the meaning set forth in Section 13(8).

"convertible .\ccurifics" has the meaning set fOrih in Section 13tH).

"CPP" has the meaning ascribed to it in the Purchase Agreement.

"E1:chunge Ac/" means the Securities Exclwnge Act of J 934, as amended, or any

successor statute, and the rules and reguIDtions promldgated tht;reunder,

'-1~1·('rthl:' Price" means the ,Ull0Unt S(~t h-:lJ"th in Item 2 of Schedule A hereto,

"Expiraliol1 /'in/c" has [he meuning st't hmh in Section),

"Fair Jf(/rkct Vil!lIe" means, with resrcct to any seC'urily or other property, the f;tir

ll1:1rkcr value ofsuch security (If other pmpcrty as d",tennilJt'd by the Bomd of Directors, acting

in g<.l(.\C1 !~lith Of. wirh rcsfX'cl W S"Ylii..'ll 14, as (ietennined by the- Original Warrantholdcr acting

in gOi\d 1ilith Fur <;(1 long as Ult'" Original W,lrranth{IILler holds this Wsm-:U1t or any porlinn

th~r~'(:"'f, it' ll1::ly I,\bjecl ill \vrhmg to tbe Board ofDircC{N'\ cakurati,)n (.[hir markd value within

10 <lJys orfi.'Ccipr (~[v.'litr~n iwtic<.: thaeof. lUll.: Origill~d W:JIlHmh(lldn and th~ Comp<JJ1Y are

ItlJ,:lbk to agr'¢e on jajr market value during the IO-day period foll(~rl"iJ1g tl1~' ticliv{;'J'y ofllle

OriginaJ \";1lnm{ll\>lJer'~ ol~k(:tjo'!l, t1w Appl";liS-<iJ l--'rlKedur..:- Inay he invu!-':cd by t:Ltll,'r party w
determine Fair l\farket Value oy delivering written notification thereof not later than lhe 30'h Jay

aher delivery ofthe Original W(llTantholder':-; objectitm.

'·('/oFcmme!1ud Fntities-· has the meaning ascribed to it in the Purchase Agreement.

"lnilial ,:'Vumher" has the meaning set rorth in Sel,.'tiO!l 13(B).

"Issue Duff}' means the date set forth in Item 3 of Schedule A hereto.

",'!,{arla'1 Price·' means, with respect to a particular security, on any given day, tile last

reported sale price regular way Of, in case no such reported sale takes place on such day', the

average ofthe last closing bid and ask prices regular v,,£1y. in either case on the principal narional

securities exch,mge on ,vhkh the applicable securities are listed or admjtt~d to trading, or ifnot

listed or admiUed h1lrading on any national securities exchange, the average orthe closing bid

and ask prices as furnished by two members ofthe Financial Industry Regulatory Authority, fnc.

selected from time to time by the Company for that purpose. "Market Price" shall be determined

\vithout reference to after hours or extended hours trading. Ifsuch security is not listed and

traded in a manner thar the quotations referred to above are available ror the period required

hereunder, the Market Price per share ofCommon Stock shall be deemed lo be (i) in the event

that any portion of the Warrant is held by the Original Warrantholder, the rair market value per

share ofsucb security as detennined in good faith by the Original Warrantholder or (Ii) in all

other circuDlstances, the fair market value per share ofsuch security as determined in good t~lith

by the Board ofDirectors in reliance on an opinion of a nationally recognized independent

investment banking corporation retained by the Company tor this purpose and certified in a

resolution to the Warrantholder. For the purposes of dctcnnining the Market Price orthe

Common Stock on the "trading day" preceding, on or follO'\'iing the OCClllTCnCe of an event, (i)

that trading day shall be deemed to commence immediately after the n:gular scheduled closing

time oftrading on the Ne\\· '{ork Stock Exchange or. iftradillg is c1ost:d at an earlier time, such

earlier time and (ii) that trading day shall end at the next regular scheduled closing time, or if

trading is closed at an earlier time, such earlier time (for the avoidance of doubt and as an

example, ifthe !\tlarkd Prke is to be determined as ofthe last trading day preceding a specified

t':vent and the closing time oftrading Oil a particular day is 4:00 p.m. and the specified event

OCt:UfS at 5:00 p.m. on that day, the .l\.larket Price would he detennined by reterence to such 4:00

p.m. dosi.ng price).

"Ordinm}' C'a.\'h Dividends·' means a regular quarterly cash dividend on shares of

Common Stock out ofsurplus or net profits kgall) availahle therefor (dc1enniot'd in accord:mce

with generally accepted accounting principles jn effect frpJn time to tinw). provided that

Ordinary Ca."h Diyidl.7nds shall not include any cash di' idend,-; paid sUhs<;;'qliem to the Is'me Dale

ti:.' the extenl the :jggrcgate per ~harc dividends p,lid on the ,mtstanding Comn}(ln Ste,-:k in Jny

quarter exceed the amtmnt set fflrth in Item 4 ()f Schedule ,\ hereto, as adjustl.:d fix an:. stol'k

~plit, stock dividend. n'ver,,;C' s(ock splil. n::das:iificatjon or similar tmnsadion.

"Original fFarf'am},oidcr" means the Lniu'(] Stat.e"- J)ep,lfUnent of the Trc<lsllr)'_ '\n:;-

Jl'tions sp<:.cilie.d to he taken b.\' thl' Originrtl W:'lITantholdcr hercl1mkr t11a~ l)ol.'r' he ukl':Jl hy ~\ldl

Pers(\n and not hy (l'uy (~th('l' \Varrantholdcr.
"l'ermifled l'nlnsL)('riom-' has tht' meaning set forth 1\1 Scuion r3(H).

"Person" has the meaning given lo it in Section 3(a)(9) nflhe Exchange Act and as llsed

lD Sections 13(d)(3) and 14(dl(2) ofthe Fxchangc Ad.

'"Per .')'ltare Fair .I'farkc! r"alue" has the meaning set forth in Section 13(C).

··Prcjf'rrcd Shares" means the perpetual preferred stock i$sucd to the Original

Wdrrantholdtjr on the lssue Date pursuant to the Purchase Agreement.

"1'ro Rata Repurchases" means any purchase ofshares ofCommon Stock by the

Compan)' or an.y AlIiliate thereof pursuanl to (A) any tender oHcr or exchange ofter subject to

Section 13{e) or 14(c) or the Lxchangc Act orRcguJation r 4E promulgated thereunder or (8)

any other otTcr available to substillltially all holders ofColllll1on Stock, in the case of both (A) or

(8), '-"'hether for cash, shares of Capital Stock ofthe Compimy, other securities ofthe Company,

evidences of indebtedness ofthe Company or an:y other Person or any other property (including,

\vithout limitation, shares ofCapital Stock, other securities or evidclH.:es of indehtedness ofa

subsidiary), or any combination thcreoJ~ effected while this Warrant is outstanding_ The

"Effective Dale" of a Pro Rata Repurchase shaH mean the date of acceptance ofshares fix

purchase or exchange by thc Company under any tender or exchange offer which is a Pro Rata

Repurchase or the date of purchase with respect to any Pro Rak'l Repurchase that is not a tender

or exchange offer.

"Purchase Agreement" means the Securities Purchase Agreement - Standard Tem1S

incorporated into the Letter Agreement, dated as ofthe date set forth in Item 5 of Schedule A

hereto, as amended from time to time, bet\veen the Company and the United States Department

ofthe Treasury (the "Letter Agreement"), including all annexes and schedules thereto.

"Qual!/ied Equity CHferillg" has the meaning ascribed to it in the Purchas0 Agreement.

"Regulatory' Appromls" '>vith respect to the W<lrrantholder, means, to the extent

applicable and required to permit the Warrantholder to exercise this Warrant for shures of

Common Stock and to os\'n such Common Stock v.-ithout the WillTantholdcr being in violation of

applicable law, nJic or regulation, the receipt orany necessary approvals and authorizations oC

tiling:; .md rcgistralion5 with, notifications io, or expiration or termination of any applicable

waiting period under. the Hart-Selltt-Rodino Antitrust Jmprovements An of 1976, as amended,

anJ the ruks and regulati(ll1s thereund~r.

",';,,'Fe" means the U.S. Securili-.:s and Exdwnge Commission.

" ...·ecuritit:s .-le!" means the SC(l[rjtic~ .Act Pi" J93}. as amended, (II' an:;,' Sllccessor ~tatt1te,

and the rules and rcguLllion" rr1.~mulgat..::d (hcr~umkr.

"SJklres" ha~ t/),;;· m~aning S~! t\mh In Sc.:ti'm 2

"tradin}! d{~r ,. meiJns (.\_1 ifthe ,:;h:1J't':':; ofCmunon Sk'C\": are n,)1 t1'8dcd on ,my na{lonal

fJf n:~gi()l1al sex:J.lrirk", ('\.,h'1)"lgC or 'I::;;';ix'iati<.'\i\ 01' o\'er-lh('-C:(\(Jnl~r ITlilcket a hu..,in-::.;" d:~y or tIn

ii" lhl: sh,ll-co;; c'l' CI_'lnnh\!l SlOd-: ,in;' tmdcd ,>n ,Uly n;llional ('r reg)c'!lal s~cnrirlCS ('X,-'hclllgl;.' ,'r

,
association or over-the-counter markel, a business Jay on Vihidl such relevant exchange or

quotation "ystem is <;chcduled to be open for business and Oil which the shares of Com mOll

Stock (I) arc not sllspended fi'om twding on any national or regional securities t'x..~hange Pf

association or oveHhc~counter market for any rerlod or periods aggregating one half hour or

longer: ,md (ii) have traded at least once on the national or regional securities t':xchangc ur

association Of over-the-counter market that is the primary market fIX the trading ofthe shares of

Common StUl:k.

''[is GAAP" means United States generally accepted accounting principles.

"lFarrmuholder" has th0111caning sd Ji.H1h in Scction 2.

"I'I-'(wrant" means this Warrant, isslled pursuant to the Purchase Agreement.

') ~_ul11ber of Shares: b:en:ise Price. This certifies thaI. for value received. the

United States Department ofthe Treasury or its pennitted assigns (the "Warranthofder") is

entitled, upon the terms and subject to the conditions hereinafter set forth, to acquire fi'olTI the

Company, in whole or in part, after the receipt of all applicable Regulatory Approvals, if any, up

to an aggregate ofthe number offully paid and nonassessable shares of Common Stock set forth

in Item 6 of Schedule A hereto, at a purchase price per share ofCommon Stock equal to the

Exercise Price. The number ofshan:s ofCommon Stock (the "S'hares'') and the Exercise Price

are subject to adjustment as provided herein, and all references to "Common Stock," "Shares"

and "Exercise Price" herein shall be deemed to include any such adjustment or series of

adjustments.

3, Exercise ofVlarrant: Ternl. Subject to Section 2, to the extent peonitted by

applicable laws and regulations,. the right to purchase the Shares represented by this Warrant is

exercisable, in whole or in part by the \Varrantholdcr, at any time or from time to time after the

execution and delivery ofthis WalTant by the Company- on the date hereot: but in no event latcr

than 5:00 p.m.. Nc\\· York City time on the tenth anniversary orthe Issue Date (the "Expiration

Time"), by (A) the surrender oftili:,; Warrant and "Notice ofExcrcise annexed hereto, duly

completed and executed on behalf ofthe Warrantholdcr, at the principal executive oftice ofthe

Company located at the address set forth in Item 7 of Schedule A hereto (or such other office or

agency oftllc Company in the United States as it may designate by notice in writing to the

v.-arruntho!der at the addres~ ofthe WarrantholJef appearing 011 the books ofthe Company), and

(B) payment orthe Exercise Price for the Shares thereby pun:hased:

(i) by h.1\'ing the Company withhold, trom the shares ofCornmon Stock that

would orhcn\·isc be delivered to the \Varrantbo!dcr upon such exercise, shares ofCommon SliX,.'k

issllabk up0n cxcrcis\.': oftbe WMr3flt equal in YUIlle ttl the aggr~gate Exercise Price as to which

thi:,:, \Vmranl is St1 cx..:rciseJ based on the ivlarkct Price tlfthe CotDrnon Stock on the trading day

(ll1\vhkh this \"raTTanf is exercised ~md the\.iolict: ('fl':,,,~r.;:!se 1$ ddi\ercd to tIle C1mpany

pllr~\I;lJ'lt to tins Section 3. pr

(iii \.,.irh the consent "fboth thl: C:ompany and tIll' \VammthoJder, by temkring in

(::-1"I1,"by certjiied ur (;OI~hl('r's check pay:Jble:o til;,; \)rd~r oftb: Company, or by \vire {rooster uf

immediately aV:lil:1bl(';-,nlll", I,) ail :ll:CCHlllt dt:t;ignati:'d by rhe Company
{fllle \",iarranthokler docs not ex~rcfse this \\.'arrant in its t.:ntiret)', the

Warrantholder will be entitled to receive from the Company \vithin a reasonable lime" <md in any

event not exceeding three business days, a nc\~' v\"al'rant in substantially identical form for the

purchase oftint number of Shares equal to the dilkrence between the number of Shares subjcd

to this \Varrant and the number ofSbares as to which this Warrant is so exercised.

;..iolwithstanding anything in this Warrant to the (:on1.rary. tht' Warrantholdcr hcrehy

acknowledgr::s- and agrees that its exercise of tim; \\'arrant f()f Shun.~s is subjcct 10 the condition

that the \\/arranthofder "",:ill have first received any applica.ble Regulatory Approvals.

4. J?~llallce ofSlJares: Authoril:ation; Listing. Certificates for Shares issued upon

exercise ofthis W8rranl \vill be issued in sueh name or names as the Warrantholdcr may

des.ignate and will be delivered to such named Person or Persons within a reasonable time, not to

exceed three business du)·s atter the date on which this Warrant has been duly exercised in

accordance with the terms ofthisWarranL The Company hereby represents and warrants that

any Shares issued upon the exercise ofthis Warrant in accordance with the provisions ofSectioll

3 will be duly and validly authorized and issued, fully paid and nonassessable and free from all

taxes. liens and charges (other than liens or charges created by the Vo/arrantholder, income and

ti·anchise ta'\.es incurred in connection \vith the exercise ofthe Warrant or taxes in respect of any

transfer occurring contemporaneously therc\vith). The Company agrees that the Shares so issued

\'v·ill be deemed to have been issued to the Warrantholder as ofthe close of business on the date

on which this Warrant and payment ofthe Exercise Price arc delivered to the Company in

accordance with the terms ofthis \Varrant, notwithstanding that the stock transfer books ofthe

Company may then be closed or certificates rcpresenting such Shares may not be actually

delivered on such date. The Company will at all times reserve and keep available, out orits

authorized but unissued Common Stock, solely for the purpose of providing for the exercise of

this Warrant, the aggregate number ofshares ofCommall Stock then issuable upon exercise of

this Warrant at any time. The Company will (A) procure, at its sale expense, the listing ofthe

Shares issuable upon exercisc ofthis Warrant at any time, su~ject to issuance or notice of

issuance, on all principal stock exchanges 011 which the Common Stock is then listed ur tradeJ

and (B) maintain such listings ofsuch Shares at all times after issuance. The Company will use

reasonable best elTorts to ensure that the Shares may be issued without violation of any

applicable lnw or regulation or of any requirement of any securities exchange on which the

Shares are listed or trili.led.

5. No FradipnalliJ:Larcs or S\:rip. No fractional Shares OJ scrip representing

fractional Shares shall he issued upon any exercise ofthi., Warrant. In lieu of any fhtctiomll

Share tu whicb the Wa11'antholdcf \-vould otht.:rwisc be entitled. the Wammtholder shall be

entitled to rc-::ci\'c a ca~h payment equal to the j'vlarkct Price uf the Common StocK on the la-;t

trading day preccdillg the dale of ex~rcise ic,>s the pro-rated Exercise Price tix sUl.'h ti'actional

share.

6. ;.ill Rights a.~ Stc·ck!~_(\lder::;; Trims!'"r Buoks. This \Namlllt does Hot entitle tilt,::

Vi'-arranthoJde-l' to any \·oting rights or Olhcr rights (IS a stc,ckhokkr oftJle Comp,my [mol" [l) the

dale orcxcr~·[.'>C- hcrec'f. f"hc (ompll1ly will.lt no lime clo:',l~. ils transt(.'f b~ll)ks. agninsi lnmsfcr (It

this WUlTilfil in any mnnneT \\hich intcrl\::rc>\vith the timely exercise t~flhl~ \v·mTaIll.
7, Charges. Tuxes and LXp011~e>:. I%U31ll.X: or tatiticates ]()]" Shares h, the

Warrantholder upon the ex~rcisc OrthlS Wilrrant shall he made \\ ithou[ charge to the

Warrantholdcr for any issue (}r transfer tux or other incidental expen in re.5peet ofthe issuance

of such certificates, all of1,vhich taxes and cx.p<2n<;cs shall be paid hy tllt; Company.

g. JransJcriAssi>!nmcnt.

(1\) Subject to compJicmce" ith dause (B) of'this Section 8. this Warrant and all rights

hereunder are transterable, in whole Of in pan. upon the books ofthe Company hy the registered

holder hcn:-:o-f in person or by duly authorized attorney, and a new warrant shall be made and

delivered by the Company. ofthe same tenor and dale as this Warrant but registered in the name

or one or more transferees, upon surrender ofthis Warrant, duly endorsed, to the office or agency

ofthe Company described ill Seclion 3. All expenses (other than stock transfer taxes) and other

charges payable in connection \vith the preparation. execution and delivery of {he new warrants

pursuant to this Section 8 shaH be paid by the Company.

(B) The transfer ofthe Warrant and the Shares issued upon exercise ofthe Warrant

are su~ject to the restrictions set forth in Section 4.4 ofthe Purchase Agreement If and for so

long as required by the Purchase Agreemcnt this Warrant shaH contain the legends as set [orth in

Sections 4.2(a) and 4.2(b) ofthe Purchase Agreement.

9. Exchange and Registry of Warrant. This Warrant is exchangeable, upon the

surrender hereof by the \v'arrantholder to the Company. for a new warrant or warrants of like

tcnor and representing the right to purchasc the same aggregate numher of Shares. The

Company shall maintain a registry shO\ving the name and address ofthe Warrantholder as the

registered holder ofthis Warrant This \~/arrant may be surrendered for exchange or exercise in

accordance \\ith its tenns, at the office ofthe Company, and the Company shall be entitled to

rely in all respects, prior to written notice Lo the contrary, upon such registry.

10. Loss. Theft, Destruction or Mutilation of Warrant. Upon receipt by lhe Company

ofeYidence reasonably satisfactory to it ofthe loss, theft. destruction or mutilation ofthis

Warrant, and in the case of any such loss, then or destruction, upon receipt ofa bond. indemnity

ur security reasonably satisl~lclor)' to the Company, or, in the case (1I'an)-' such mutilation, upon

surrender and cancellation of this Warrant, the Company shall nmkc and deliver. in lieu ofsuch

lost, ~to1clJ, destroyed or nlutilated Warrant, a new \\iafnmt of like tenor and representing the

right to pun::,ha!'t' the same aggregate llumher of Shares as provided for in such lost. stolen,

destroyed or mUlilated. \Vmnnt.

1L SatllnJaY~. Sunuays, HoJida\':~, cle. lfthe tast 01' appoimed day t{)r the laking of

any action 0r the c:xpiraliun of any right required or granted herein shall not bt' a business day.

then suell <Jclil)n may b'e takell or sw:h right may be t'"xcrcisd illl fbi.:' nexr sDI.'..:cc:Jing d;-I)' th8t is

a business d:ly.

12. Huh;: 14illn((liTnatj(;11. The CempaJ1~ I..:ClveniliHS thnt it witl USc its re,ls<..ltlab!I;;' be::.t

efforts l() linll.'ly (i!,;- ::lll reports and other dOCUOl.;'HtS rcqujr,;~d 10 lx~ filed by it Huon llle

Sc,,\,uritics /\d and tire Exchange AcT and the rules and ro::gubti(,n" promulgated by tbe SEC

rherniIldcr (or, ift!Jc C(\j;'lpany i~ nnt ~eqllircd k: tik sudl rq)\~rrs. it \vi~L (tPO~l th'" request (If "HIy
\.VarrallthoIJer, make publicly available SUdl inJ'()]"mation as necessary to permit sales pursuant to

Ruk 144 under the Securities Act). and it \A'ill lise rca::.onabk best cJl(wts to take such further

action as any \VarrantholJer may rcasomlbJy request, in each case to rhe c,\.1enl required JrOlll

time to time to enable such holder to, jf permitted b) the tCl1l1S orthis WalTal1{ and the Purdwse

"'\gr('~lI1ent, scll this Warrant withollt rcglstration under ihe S~curitics Act within the limitation

ofthe exemptions provided hy {A) Hule 144 under the Securities. Act, as such rule may be

amended hom time to time, or (B) any slIccessor rule or regulation herea1i:er udopted by the

SEC. Upon the written request of allY Warrantholdcr, the Company \viJl deliver to such

\Varrantholder a \vritten statement that it has complied \"ith such requirements.

13. Adjustments and Other Rights. '111C Exercise Price and the number of Shares

issuable upon exercise of this \Varrant shall be subject to adjustment from time to time as

follows: provided, that ifmorc than one subseclion ofthis Scction 13 is applicable to a single

event, the subsedion shall be applied that produces the largest adjustment and no single cvent

shall cause an adjustment under more than one subsection ofthis Section 13 so as to result in

duplication:

(/\.) Stock Splits, Subdivisions, Reclassifications or Combinations. Ifthe Company

shall (i) declare and pay a dividend or make a distribution on its Common Stock in shares of

Common Stock, (ii) subdivide or reclassify the outstanding shares ofCommon Stock into a

greater number of shares, or (iii) combine or reclassit')· the outstanding shares ofCommon Stock

into a smaller number ofshares, the number of Shares issuable upon exercise ofthis Warrant at

the time ofthc record date for such dividend or distribution orthc ctlcctive date ofsuch

subdivision, combination or reclassification shall be proportionately adjusted so that the

Warrantholder after such date shall be entitled to purchase the number of shares ofCommon

Stock whieh such holder would have owned or been entitled to receive in resped orthe shares of

Common Stock subject to this \\/arrant after such date had tbis Warrant been exercised

immediately prior to such date. In such event, the Exercise Price in eftect at the time ofthe

record date for such dividend or distribution or the effective date of such subdivision,

combination or reclassification shall be adjusted to the number obtained by dividing (x) the

product of (1) the number of Shares issuable upon the exercise ofthis v.,rarrant before such

adjustment and (2) the Exercise Price in effect immediately prior to the record or effective dBte,

as the case may be, for the dividend, distrihution, subdivision, combination or reclassification

giving rise to thi~ adju:;(metlt by (y) the new Humber of Shares issuable upon exercise ofthe

Warrant determined pursuant to the immediately preceding sentence.

(B) Certain Issuances Of(\lIllJll0n Shares 01" Ctmvertible Securities. Until the earlier

of (iJ the date on which the OriginaJ\Varrantholder no longer holds thbWanunt or "my p,xtion

thereof and (ii) the third annJ\ersary ofthe Issue Dafe, ifthc Company shall is:::uc shares of

Common Stock (or rights or warrants or other sc<:urilics exerci,able or convcrlibh.' intn PI'

exchangeable (collectively, a "Cofn'f.'!'sicm") fCrr :;:harc.s ofColTlrnoJl Stock) (C()]Jcctivdy,

"c(m\,ertihle :;ecnrilies") (0thct" than in }\:rmi1tcd Tr;:ll1s,Ktions fas defined hck.\I) ur a

transaction to .\hi~·,h sllb-;ei.:ri,1!l {AI \JftlllS Sl;..::lIOIl ! 3 IS applk:clbte) \1, ithout cOl1siJt'ration cr at 3

~l1Jlsidct~lti(ln pt'f ~haI~ (or having a con\.'er;;ion price per "'han:) thar is les~ l'ban 90',1'·'1 ofth{:

I'darket Price on the 111<;( l.Hlding ,by pr~L~dil1g the dak oft-he agre{'nWlJl un pricini,', such shm.:s

(,."II" ':ouch ~·(lnv('\1ib!e ,><;,('W'it1c"i lhcn. in sU:'-'h eve1:!'
(A) th0 num{wr of Shares issuabk upon tht:= exercise uflhi" \Varrallt immediately

prior to the dale ofthe agreement on pricing ofsuch ~hares (or orsuch convertible

s.ecliritics) (the "'Initia! N1fmbel'?') shall be im:reased to tlJe number obtained by

multiplying the Initial Number by a fraction (A) the rlllmerator of which shall be

the sum of(x) the number ofshares ofCommon Stock ofthe Company

outstanding no such date and (y-) the number of additional sfwres o(Common

Stock issued (or into which convertible securities may be cwrcised or convert)

and (B) the denominator of which shall be the sum 01'(1) the number ofshan:s of

Common Stock oublanding on such date and (IT) the number orshares of

Common Stock which the aggregate consideration receivable by the Company for

the total nUlnher ofshares ofCommon Stock so issued (or into which cOl1verlibk

securities may be exercised or convert) would purchase at the \Jlarket Price on ihe

last trading day preceding the dale ofthc agreement all pri.cing such shares (or

such convertible securities); and

(8) the Exen:ise Price payable upon exercise ofthe \\'arrant shall be adjusted by

multiplying such Exercise Price in effect immediately prior to the date ofthe

agreement on pricing ofsuch shares (or ofsuch convertible securities) by a

fraction, the numerator ofwhich shall be the number ofshares ofCommon Stock

issuable upon exercise ofthis Warrant prior to snch date and the denominator of

which shall be the number ofshares ofComillon Stock issuable upon exercise of

this Warrant immediately after the adjustment described in clause (A) above.

For purposes ofthe foregoing. the aggregate consideration receivable by the Company in

connection with the issuance ofsuch shares of Common Stock or convertible securities shall he

deemed to be equal to the sum ofthe net offering price (including the Fair i\1arket Value ofany

non-cash consideration and after deduction of any related expenses payable to third parties) of al I

such securities rlus the minimum aggregate amount, if any, payable upon exercise or conversion

of any such convertible securities into shares ofCommon Stock; and "Permitted Transactiom':'

shall mean issuances (i) as consideration for or to fund the acqnisition of businesses andlor

related assets, (ii) in connection with employee benefit plans and compensation related

arrangements in the ordinary course and consistent with past practice approved by the Board of

Directors, (iii) in connection with a public or broadly marketed oncring and sale ofCommon

Stock or convertible securities tllr cash conducted by the Company or it'i affiliates pursu,mt ttl

regl~tration under the Securities Act or Ruk 1..J-4A thereunder on a b<:lsis consistent ~'jth capital

raising transacticms by comparable tinanci,-lI institutions and (h) in connection with the exercise

of preemptive rights 011 terms existing as: of the Issue Date, ,'\ny adjustment made pursuant to

this S("Clion 1_~(H) shall b~come d1tx:livc immediately upon the U,-1te ofsuch issuance.

(C) i2H1~r {),btr.i.bJLti_Ol1'i' In C3SC 111,,' ('ompaJlY sh:lll fix a recDrd date for tbe making

'-.If l.1 di~1.rjhl1ti"ln 10 all bolders ofsh::lrcs of" its Common Stock ot' securities, eyiJcllces of

indeht~x.lJless, ns;:.;c'ls, ca"h, righh or warnU)t'~ (exl.:luJifl~ Ordinary (ash Dividend:;;, dividends of

il~ Common Stl'l(;K and \)t!Kr divjtlt'nds or distrihutjons rcH:rrcd to in Sectlon 1](A)).. in (;31.::,11

sitch tase, t.he Exercise Prk'e in cHeer priur to su..::h recorJ date shall he reduced immcdiMt'ly

thc-reatl.el· T,) Ute prke dl.'termin:::d by nmftipJying the [xcrcis(' Pri.:c in efi<:tt immediately' prior h:'

tbe n:dw.:til)Jl h.\' tho;: ql:ottt.:nl (If (x.) the M:)rkcr Price lOll" th~ CmmlOll St,lck lm t!J-:: last trading

d,ry pr~~c-ed;flg Ih{" first dati: on ",.hich the C()llHIIOn ShICK tyad::s rcgdm \\i1)' \111 the prillcip;ll

9
national sCl..:uritics cxchange on which the Common Stock IS listed or admitted to trading 1ivithout

the right to receive such distribution, minus the amount of cash and/or the Fair rVlarkd Value or

the securities, evidences of indehtedncss. assets, rights or warrants to be so distributed in n:spect

of one share ofCommolJ Stock (such amount and/or Fair :'\1arket Value, the "Per Share Fail'

Markel V(due") divided by (I,') such '\:larket Price on such date srccified in clause (x); such

adjustment shall he made successively whenever such a record date is fixed. In such event the

numher nfSharcs issuable upon the exercise ofthis Warrant shall be increased to the number

obtained by dividing (x) the product of(1) the number of Shares issllHble upon the exercise of

this \Varrant before such adjustment, and (2) the Exercise Price in eHeet immediately prior to the

distTibution giving rise to this adjustment by (y) the new Exercise Price determined in

accorJam:e with the immediately preceding sentence. In the case of adjustment [or a cash

dividend that is, or is coincident with, a regular quarterly cash dividend, the Per Share Fair

Market Value would be reduced by the per share amount ofthe portion ofthe cash dividend that

\';'Quld constitute an Ordinary Cash Dividend. [n the event that such distribution is not so made,

the Exercise Price and the number ofShares issuable upon exercise ofthis Warrant then in efleet

shalt be readjusted, effective as ofthe date when the Board of Directors determines not to

distribute such shares, evidences of indebtedness, assets, rights, cash or warrants. as the case may

be, to the Exercise Price that would then be in effect and the number ofShares that would thcn

be issuable upon exercise ofthis Warrant ifsuch record datc had not been tixed.

(D) Certain Repurchases ofCommon Stock. In case the Company effects a Pro Rata

Repmchase of Common Stock, then the Exercise Price shall be reduced to the price determined

by multiplying the Exercise Price in efteet immediately prior to the Eftective Date ofsuch Pro

Rata Repurchase by a fraction ofwbich the numerator shall be (i) the product of(x) the number

ofshares of Common Stock outstanding immediately before such Pro Rata Repurchase and (y)

the Market Price ofa share ofCommOll Stock on the trading day immediately preceding the first

public announcement by the Company or any of its Alliliatcs ofthe intent to effect such Pro Ral,;1.

Repurchase, minus (ii) the aggregate purchase price oflhe Pro Rata Repurchase, and of\\'hich

the denominator shall be the product of(i) the number ofshares ofCommon Stock outstanding

immediately prior to such Pro Rata Repurchase minus the number ofshares of Common Stock so

repurchased and Oi) the Market Price per share ofCommon Stock on the trading day

immediately preceding the first public announcement by the Company or an,Y of its Affiliates of

the intent to effecI such Pro Rata Repurchase. In such event, the number ofshares ofCommon

Stock issuable upon the exercise of this Warrant shall be increased 10 the number obtained by

dividing (x) the product of (1) the 111llnber of Share::. j:;suable upon the exercise of this \Varrant

before such adjustment, ,md (2) the Exercise Price in effect immediately prior to the Pro Rata

Repurchase giving rise to this adjustment by (y) the new Exercise Price determined in

accordance with the immediately preceding sentence. l:or the avnidancc of doubt nn illcreac;e !()

thel'xcrei-.c Price or JCCft:'[lSC in the number of Sbares i:>stlable UpOIl exercise ofthi~ WamlJ1t

shall bl' made pursuant tu this Scc1i(ln DID).

iE) BlI"jne~~Cil.mh~1..l_ations:. In case ofany Uusincss Comhimni01l ('r rccla!':;ific.mioll

of CUmm~)l~ SW·ck ((lther than a reda..ssifiL'alioH ofComm.'n Sll)ck rc:ferrcd tu in S.;:'ction 131.'\ i).

th~' \\I'ilrranthnld(.'r·s right tu reum'l~ Sh~re~ upon exercise nfthis Warram <;h~'ll1 be- converted into

the right to ,-'x;;J\_~ise this \V:.trllln[ 10 W.::4uire the nu.mb~r d' shar(;~s ofstock nr (,ther securitie-: or

pn-'f)t'\ty (including cdsh) which rllt:' Common SV>ck i',.<;uablt' (at the time l"fslli.;h Hu~jn~ss

CO:lIbin:ll'l{J!1 (If r,;cl~\"sifi~'3tI()n, l'r\)/l eXel'i..'lSl' IYt"thi-,: \Varrant immediately prwr Ie ~u(;h
Husiness Comhination or reclassification would have been entitled to receive upon

consummation ofsuch Business Comhination or rec1assificinion; and in any such casco if

necessary, the provisions sd forth herein with respect to the rights and interests thcrt:aJtcr ofthe

Warrantholder shall bl' appropriately adjusted so as to be applicable, as nearly as may n.:aslmably

bc, to the \Varranth(lldcr's right to exercise this Warrant in cxchang<..: tl:lr any shares lJI"slock or

other securities or property pursuant to this paragraph. In determining the kind and amount of

stock, securities Uf the property recci\iabh.~ upon exercise ofthis Warrant following the

consummation ofsuch Business Combinalion, ifthe holders ofCommon Stock have the right to

elect the kind or amount of consideration recl;;':ivable upon consummation ofsuch Business

CombinatiolJ, then the consideration that the \Varrantholder shall bc entitled to rcceivc upon

exercise shall be deemed to be the types and amounts of consideration received by' the majority

of all holders oftile shares of common stock that aftirmatively make an election (or of all such

holders ifnonc make an election).

(F) Rounding ofCaJculations: :\!finimum Adjustments. All calculations under this

Section 13 shall be made to the nearest one~tcnth (1/1 Oth) of a eem or to the nearest onc~

hundredth (1I100th) ofa share, as the case may be. An.y provision ofthis Section 13 to the

contrary notwithstanding, no adjustment in the Exercise Price or the number of Shares into

which this Warrant is exercisable shall be made ifthe amount ofsllch adjustment would be less

than $0.01 or one~tcnth (1I10th) ofa share ofCommon Stock, but any ':iuch amount shall be

carried forward and an adjustment "vith respect thereto shall be made at the time of and together

"vith any subsequent adjustment which, together with such amount and any other amount or

amounts so carried forward, shall aggregate $0.0 I or 1/1 Oth of a share ofCommon Stock, or

marc,

(G) Timing of Issuance of Additional Common Stock Upon Certain !\djustments. In

any case in which the provisions of this Section 13 shall require that an adjustment shall become

effective immediately after a record date for an event, the Company may defer until the

occurrence ofsuch event (i) issuing to the Warrantholder of this Vv'arrant exercised after such

record date and be/ore the occurrence ofsuch event the additional shares of Common Stock

issuable upon such exercise by reason ofthe adjustment required by such event over and above

the shares of Common Stock issuable upon such exen:ise betore giving effect to such adjustment

and (ii) paying to such Warrantholder any amollnt of cash in lieu ora fractional share of

Common Stock: provided, however, that the Company upon requt:st -::hall deliver to such

Warranlholder a due bill or otht>,r appropriClte instrument evidencing such Warrantholdcr's right

w receive such additional shares, und such cash, upon the ocumence ofthe event requiring such

adjustment.

(1-0 ~~omplelion of QU<llified Egui!\ Otfering. Tn the event tbe Company (or any

';UCCe'iS(1r by f1usillt'ss ('nmhim.ltion) lAJtnpletes (Ine or more, QualitlcdLquity Offerings on or

prior tn Dc.::.ember 3 J, 200Q tIM! result in the Compa.ny for any s.uch successor) rccc,ivillg

aggregate gross prl)~(;'~ds (Ifnot les_~ tI1J)) I(I()L'/;l ofthe aggregate liquidatinll prdercJ1c(;,; tl(the

Prdt'rred Shares (and an~ pn.:'ferrcd stol;k j~sued by any such succeSS'lf to tht; Origini.lt

\\t'wTantlk\ldcr under the CPP), th\..' number or "hart:~ <...d' (\lH1nWn ~1O,-,f.,: :mJerlying the PO.niPfi uf

Ihi.s \Varrant then held by the Original \V8.rr~mth()IJcr shall be t!lcr"::::l1kr rcdllced by a number of

shares of ("omm,"n Stock cqurr[ to the pWd.K.1 of (i) 0.5 ;:lllJ (ii) the IlUlnb('r (If slwl":':: Hmkrl)'lng

Ii
the Warrant on the Issue Date (adjusted to takt: into account ull other lhcreto!lxe I1Ulde

:ldjustmenrs pursuant to this Section 13),

(1) Other Events. For so long as the Original \Varnmtholder holds this Warrant or

any portion thercoL if any event occurs as to which the prO\'lsi()ns of this Section 13 are !HIt

strictly applicable or, if&trictly applicable, \voldd not in the good 1aith jUdgment of the Board of

Directors orthc Company, fltirly and adequately protect the purchase rights of the \i\'arrants in

acconJancc \'lith the essential intent and principles ofsuch provisions, tben the BOilrd of

Directors shall make such adjustments in the application ofsuch provisions, in accordance \vith

such essential intent and principles, as shall be rca<;onably necessary, in the good faith opinion of

the Board ofDir~ctors, to protect such purchase rights as aforesaid. The Exercise Price or the

number of Shares into which this \Varrant is exercisable shall not be adjusted in the event ora

change in the par value ofthe Common Stock or a chmlgc in the jurisdiction ofinCOlvoration of

the Company.

(J) Statement Regarding Adjustments. Whenever the Exercise Price or the number of

Shares into vvhich this Warrant is exercisable shall be adjusted as provided in Section 13, the

Compmly shall forthwith file at the principal office ofthe Compan:y a statement showing in

reasonable detail the facts requiring such adjustment and the Exercise Price that shall be ill effect

and the number of Shares into which this Warrant shall be exercisable al'ter such adjustment, and

the Company shall also cause a copy ofsuch statement to be sent by mail, first class postage

prepaid, to each \VarranthoJder at the address appearing in the Company's records.

(K) Notice or Adjustment Event. In the event that the Company shall propose to take

any action ofthe type described in this Section 13 (but only ifthe action ofthe type described in

this Section 13 would result in an adjustment in the Exercise Price or the number of Shares into

which this Warrant is exercisable or a change in the type ofsecurities or property to be delivered

upon exercise ofthis Warrant), the Company shaH give notice to the \Varrantholder. in the

manner set forth in Section 13(1), which notice shall specil)' the record date, if any, with respect

to any such action and the approximate date on which such action is to take place. Such notice

shall also sct lcnth the facts with respect thereto as shall be reasonably necessary to indicate the

cftect on the Exercise Price and the number, kind or class ofshares or other securities or property

which shall be deliverable upon exercise ofthis Warrant. In the case of any action which would

require the fixing of a record date. such notice shaH be given at least 10 days prior to the date so

tixed, and in case ofall other action, such notice shall be given at least 15 days prior to the taking

of such proposed action. Failur~ to give such notice, or any defect therein, ~hall not a/reet the

legality or validity or an)' sw.::h action.

(1.) Proceedings Prior to An\' Action Requiring L\(lliI~tmcnt. As a condition precedent

to lhe k'lI.;ing of any acti\ln ,"vhidJ wnuld rcquin: an adjustment pursuant 1(1 this Section 13, the

Cump:my shall tak,;:; any action which may be m::cesS<try, including (~bl:lining rcgulatnl~, Ne'w

York STOck EXi.:hangc KASlJAQ Stock ?vtark(',t lYr tlth~r applicablt.' national sc,curities exchange

or s1ockh(llder ~lppr\lV,-lls or excmpti(ms., in llrdcr ihat the C(\1llpany Inay lht'rt"after ,,'alidly and

kgall~v is,m;;, as fi.IJly puid and nO!U15SessabJt' all sh.ares Dr C)mm0n St'.\ck that the Warramh'JIJer

is entitled 10 n;',(',I.;'Jve upon c:\crc.ise ofthis Warrant pilfsuant to this Se<:,jjon D.

I:;.
Uvf) e::\djus.flllcllt Rules. Any adjustlnents pursuant to this St;ctioll 13 shall he made

successively whenever an event referred to herein shall UCUlf. II' an adjustment in Lxerc:ise Pric,e

made hercunder wnuld reduce the Exercise Pric.e to an amollnt below par value of the Common

Stock then such adjus-tment in Exercise Price made hereunder s-haH reduce the ExercIse Price to

the pur value ufthe Common Stock,

14. Exchange, At any time t()!Iowing the date on which the shares ofCommon Stock

oftill' Company are no longer listed or admitted to trading on a national sccurities exchange

(other than in connection with any Busincss Combination), the Original Warrantholder Inay

cause the Company to exchange all or a portion ofthis Warrant for an economic interest (to be

determined by the Original \Varrantholdtor aft!;:r consultation with the Company) of the Company

classified as pennanent equity under U.S. (iAAP having a value equal to the Fair Vlarket Valuc

ofthe portion of the Warrant so cxchanged. The Original Warrantholder shall calculate any Fair

Market Value required to be calculated pUrSlli.mt to this Section 14, which shall not be subject to

the Appraisal Procedure.

15. No Impairment. The Company will not, by amendment of its Charter or through

any reorganization, transfer of assets, consolidation, merger. dissolution, issue or sale of

securities or any other voluntary action, avoid or seek to avoid the observance or performance of

any ofthe terms to be observed or pcrfonned hereunder by the Company, but will at all times in

good faith assist in the carrying Ollt of all the provisions ofthis \Varrant and in taking of all such

action as may be necessary or appropriate in order to protect the rights ofthe Warranthoider.

16, Governing Law. This Warrant will be governed by and construed in

accordance with the federal law oCtbe LJnited States ifand to the extent such law is

applicable, and otherwise in accordance with the laws of the State of New York applicable

to contracts made and to be performed entirely within such State. Each of the Company

and the Warrantbolder agn-cs (a) to submit to the exclusive jurisdiction and venue of the

United States District Court for the District ofColumbia for any civil action, suit or

procet.--ding arising out of or re-hlting to this Warrant or the transactions contemplated

hereb)', and (b) that notice may be sen·ed upon the Company at the address in Section 20

below and upon the \Varrantholder at the address for the Warrantholder set forth in the

registry maintained by the Company pursuant to Section 9 hereof. To the extent permitted

by applicable law, each of the Company and the Warrllntholder hereh~' unconditionally

waives trial hy jury ill any clvillegal action or proceeding relating to the Wllrr:mt or the

transactions contemplated hereby or thereby.

J7. Bindjng EHcCf. ·rlm; \Varrant shall be binding up()B any successor~ or ass.igns of

the Company.

18. ,\mcmimc.nru. T'his v..'arnmt may be amended and the olNervilncc of any 10ml of

Ihis Warrant may hClvaived onl) with the \I,.Tjtten c>:mscnt ufult' Company and the

W.arranthok.k-r.

19 PJ:9l))IlIIJ:;.J }\~Jjon,:!. 'fhe Company :1grces that il will not take any iKlion which

\\'UtiIJ entitle the WaITanthokkT 1(1 ,l11 ~ll1j It'::ltmcnt tit· the l-,xe.rcise f'l"i..~~ iftbe toted nurrrh~r of

sharts ("rCCi!";Em,.Hl Stu<:k f~,st!abk :,\n('[' StIch H...'ti'::iIl ~IPO~1 c,'\.c)'(:ise (!flhi:-;. W:~rrilnt. l(~ge[hcf w1111
all shares ofCommon Stock then nutstanding and all shares of Common St<\ck then issuable

upol1lhc exercise of all outsiamling options, \VamuHS. conversion <U1d oth\)1' rights. \.vould e:-:ctcd

the tOlal numba of shares of Common Stoek then authorized by ils Charter.

20. .Notices. Any notice, request. instruction or nthcr document to be given hereunder

by <my party to the other \\ill he in writing and will be de(:lJlcd to have been duly givt;n (a) on the

date ofdeliver) if delivered personally. or by facsimile, upon con firmatiol1 ofreceipl, or (b) on

the second business day fol1ov.'ing the dale of dispatch ifdelivered by a recl,gnizcd next day

courier service. All notices hereunder shall he delivered as set forth in Item 8 of Schedule 1\

hereto, Dr pursuant io such olher instructi<lOs as may be designated in writing by lhe party w

receive sw:h notice.

21. Entire Agreement. This \~/arrant, the forms at-wehed hereto and Schedule A

hereto (the terms of which arc incorporated by reference herein), and the Letter Agreement

(including all documents incorporated therein), contain the entire agreement between the parties

",·ith respect to the subject matter hereof and supersede all prior and contemporaneous

arrangements or undertakings with respect thereto.

IRemainder ofpa~e intentionally lefl blank]
[Form of Notice of .Kxcrdsc]

Datc:

TO: lCompany!

RL· Election to Purchase ComJ1lt.ln Stock

The undersigned, pursuant to the provlsions set forth in the aUal:hed Wammt hereby

agrees to subscribe lor and pt1rCh~L':iC the number orshares of thtl COHlmon Stock set forth bdow

covered by stich Warrant. The llndcr:'iigned, in aCl:ordance with Se..:tioll 3 ofthc \~/arraoL hereby

agrees to pay the aggregate Exercise Price I~)r SHi.:h shares ofCommon Stock in the manner set

r\)fth below. A new warrant evidencing the remaining shares ofCommon Stock covered by such

Warrant. but not yet subscribed for and puri.:hascd. if any, should be issued in the name set 10l1h

below.

Number of Shares orCommon Stock _

r-ilethod ofPayment of Exercise Price (note ir cashll:'1S exercise pursuant to Section 3(i) ofthe

Warrant or cash exercise pursulli1t to Section 3(ii) ofthe Warrant, with consent ofthe Company

and the Warrantholder)

Aggregate Exercise Price:

Holder:

By:

Name: _

Title:

I)
[1' WIT::\ESS WHe~RF(}F_ the Company has caused this v,;anant ll) be Jul,Y excnlled by

a duly authorized offi.cer.

Dated:

COMPANY,

8y:

Name:

Title:

Attest:

Name:

Title:

rSignature Page to Warrantl
SCHEDl!LE A

hem I

Name:

Corporate Of other organizational fbnn:

Jurisdicti\lll oforgani/,atillil:

Item 2 -!,--,I> ' l :xcrCIse nee:

Item 3

Jssue Date:

Itcnl.1

Amount of last dividend declared prior to {he Issue Date:

Item 5

Date of Letter Agreement between the Company and the United States Department ofthe

Treasury:

Item 6

Number ofshares ofCommon Stock:

[(em 7

Company's address:

Item 8

Notice information:

Initi,\l n ~r,;;is(' I\ri,~,~ !() be <:.:,1n:!ilicd hb\.-'-(j ;)11 the ;;1J."Ic.,(t.;; c,f ch"ing pric(,;:; of th:,:; C\,!I;m\1f1 Sl')(:~ ,m ~ht, .::0

Jr.id!H;;; d,'l~·.' mdillg on rhe hM lr:Jdi.!lf! day prk,r te til<' ,btc til'" (',wil·Mny' .tpplicH'.:it'!l j-~if parlkipJtj,,'1 ill

:b;, C:~p;~~il Pur;:h<:l.'i: r'n-'';iarr. I'I,'\~ ilfJp',y\c;d by lh(, Lni~ec <";tri;e~ f)"'p<ll"t'lJ(:rJ:, -,flhe lrt'c,ur:,'
SCHEDULE A

ADDITIONAL TERMS AN]) CONDITIONS

Company Infom1ation:

Name of the Company: Yadkin Valley Financial Corporation

Corporate or other organizational tonn: Corporation

Jurisdiction of Organization: North Carolina

!\ppropJiatc Federal Banking Agency: The Bo,ml of Governors of the federal Reserve

System (Richmond Branch)

Notice Infollnation: Yadkin Valley Financial Corporation

209 North Bridge Street,

Elkin, North Carolina 28621

Attention: William A. Long, President and CEO

Facsimile No. (336) 835-8858

\\/ith a copy to:

Terms ofthe Purchase:

Nelson Mullins Riley & Scarborough LLP

104 South Main Street, Suite 900

Greenville, South Carolina, 29601

Attention: Neil E. Grayson

Facsimile No. (864) 250-2389

Series of Preferred Stock Purchased: Fixed Rate Cumulative Perpeuml Preferred Stock,

Series T-ACB

Per Share Liquidation Preference of PrefelTcd Stock: SJ,000.00

Nwnber of Shares of Preferred Siock Purchased: 13,312

Dividend Payment Dates on the Preferred Stock: February 15, May 15, August IS,

November 15

Number of Initial \Varrant Shares: 273,534

Exercise Price of the Warrant: $7.30 per share

Purchase Price: $13,312,000

LOcilti\.m (}fCIDsing: Squire, Sandcr~ & Dempsey L.LP

221 E. Fourth St.

Suilt' 2900

Cini.:innutL Of-I 4520.>4(fl5

Fa\.'si.l1lile (513 'j 3f.J 120!
Time ofClosing: 9:00 a.m., New York time.

Date ofClosing: July 24, 2009

Wire rnfomlation for Closing: ABA I\'umbcr:

Bank: Yadkin Valley Bank and Trust Company

Account Nam(~: Yadkin Valley Financial

Corporation

AN'ount Number:

Beneficiary: Yadkin Valley J;'inancial

Corporation
SCIIEIJlILE B

CAI'ITAI,IZATlON

Capitalization Date: As ofJune 30, 2009

Common_ Sto~1i

Par value: £1.00

Total Authorized: 20,000,000

Outstanding: 16,129,640

Subject to warrants, options. convertible

securities. etc.: 1,002,350

Reserved for benefit plans and other

issuances: On May 22, 2008, the shareholders approved the 2008 Omnibus Stock

Ownership and Long Term Incentive Plan (the "Omnibus Plan"). An aggregate 0[700,000

shares has been reserved for issuance by the Company under the terms of the Omnibus Plan

pursuant to the grant of incentive stock options (not to exceed 200,000 shares), non-statutory

stock options, restricted stock and restricted stock units. Iong-tenn incentive compensation

units and stock appreciation rights.

Remaining authorized but unissued: 2,168,010

Shares issued after C<lpitalization Date

(other than pursuant to walTants, options,

convertible securities, etc. as set forth

above): N/A

preferred Stock

Par value. no par VUlllt'

Tot~11 AUlh0riz.:d: 1.000.000

Out~tandjllg (by st:ri('~)·. 36,000 shares ('1f fixed j{"q.tc Cumulalive Perpetual Pr..;:fcm.'d Shl(,k,

Sui(~:) T

R(·;;;.crved J0r i.~i'U~U1(;e: 13312 (10 bi' iS~\l(:xl to the In\'e.<;tor)

Rent..'iJn1ng autll{'riz('"d but: UJlis~uc,j: 950,6SS
SCHEI)ULE C

REQUIRED STOCKHOLDER AFFROVALS

Vote Required

ChJ.rtcr Aml'ndmcnt

Stock Exchange Rules

Ifno stockholder approvals are required, please so indicate by checking the box: [Xj.
SCHEllllLE D

LITIGATION

List any exceptions to the representation and warranty in S,-,ction 2.2(1) of the SL'curities

Purchase Agreement - Standard TCffi1S.

If none, please so indicate by checking the box: rXl
SCHEIJULE E

COMPLIANCE WITH LAWS

List <:my exceptions to the representation and warranty in the second sentence of Section 2.2(m)

of the Securities Purdmse Agreement -- Standard Terms.

If none, plc&"ic so indicate by checking the box: LX].

List any exceptions to the representation and warnmty in the IC!st sen1cnce of Section 2.2(m) of

the Securities Purchase Agreement - Stand,u'd Terms.

If none, please so indicate by checking the box: [XJ.
SCHEDULE F

REGULATORY AGREI,MENTS

List any exceptions 10 the representation and wammty in Section 2.2(s) oftbe Securities

Purchase Agreement·· Standard Tenns.

]f none, please so indicate by checking the hox: IX].