FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

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(ECIP Credit Unions

Subordinated Debt)

UNITED STATES DEPARTMENT OF THE TREASURY

1500 PENNSYLVANIA AVENUE, NW

WASHINGTON, D.C. 20220

Dear Ladies and Gentlemen:

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

issue in a private placement the subordinated debentures set forth on Schedule A hereto (the 

“Subordinated Debt”) and the United States Department of the Treasury (the “Investor”) intends 

to purchase from the Credit Union the Subordinated Debt, pursuant to the Emergency Capital 

Investment Program.

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

purchase by the Investor of the Subordinated Debt. 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superseded by the terms set forth herein or in the Schedules hereto, the provisions contained in 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 Terms attached hereto as Exhibit A (the 

“Securities Purchase Agreement”) are incorporated by reference herein. Terms that are defined 

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

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

terms of this letter agreement shall govern.

Each of the Credit Union and the Investor hereby confirms its agreement with the other 

party with respect to the issuance by the Credit Union of the Subordinated Debt and the purchase 

by the Investor of the Subordinated Debt pursuant to this letter agreement and the Securities 

Purchase Agreement on the terms specified on Schedule A hereto.

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

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

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

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

parties, with respect to the subject matter hereof. This letter agreement constitutes the “Letter 

Agreement” referred to in the Securities Purchase Agreement.

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

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

constitute the same agreement. In addition, this letter agreement may be executed by electronic 

signature in accordance with the E-SIGN Act of 2000. Executed signature pages to this letter 

agreement may be delivered by facsimile or electronic mail (including pdf) and such facsimiles 

or electronic copies will be deemed as sufficient as if actual signature pages had been delivered.

* * *
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

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

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

UNITED STATES DEPARTMENT OF THE 

TREASURY

By: 

Name:

Title:

CREDIT UNION: 

By: 

Name:

Title:

Date: 
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

EXHIBIT A

SECURITIES PURCHASE AGREEMENT
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE A

ADDITIONAL TERMS AND CONDITIONS

Credit Union Information:

Name of the Credit Union:

Corporate or other organizational form of Credit Union:

Jurisdiction of Organization of Credit Union:

Appropriate Supervisory Authority of Credit Union:

Notice Information:

Terms of the Purchase:

Original Aggregate Principal 

Amount of Subordinated Debt in 

the form of Annex A Purchased:

$______________

Purchase Price: $______________

Denomination Amount: $1,000.00

Maximum Aggregate Principal 

Amount

Not to exceed [7.5 percent][15 percent][22.5 

percent] of the Credit Union’s Total Assets.1

Maturity: [15][30] years

1 The general investment limit per Credit Union is $250,000,000. In addition, the following limitations apply to the 

aggregate principal amount of Subordinated Securities a Credit Union may issue, based on a Credit Union’s Total 

Assets (defined as the total consolidated assets as reported on the Credit Union’s most recent Call Report Form 5300 

submitted to the National Credit Union Administration (“NCUA”)): 

• Credit Unions with more than $2 billion in Total Assets: the aggregate principal amount of Subordinated 

Securities issued may not exceed 7.5% of Total Assets;

• Credit Unions with at least $500 million and not more than $2 billion in Total Assets: the aggregate 

principal amount of Subordinated Securities issued may not exceed 15% of Total Assets; and 

• Credit Unions with less than $500 million in Total Assets: the aggregate principal amount of 

Subordinated Securities issued may not exceed 22.5% of Total Assets. 
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

Ranking (for low-income 

designated credit unions):

As Grandfathered Secondary Capital, subordinate to all 

other claims, including those of shareholders, creditors 

and the National Credit Union Share Insurance Fund. In 

the event of the involuntary liquidation of the Credit 

Union, the Subordinated Debt will be subject to the 

payout priority for Grandfathered Secondary Capital as 

set forth in 12 C.F.R. § 709.5(b)(8) (or any successor 

provision).

Ranking (for other credit unions): Subordinate to all other claims, including those of 

shareholders, creditors and the National Credit Union 

Insurance Fund. The holder of the Subordinated Debt 

will agree to be subject to the same payout priority as set 

forth in 12 C.F.R. § 709.5(b)(8) (or any successor 

provision) for Grandfathered Secondary Capital, as 

though the Subordinated Debt were Grandfathered 

Secondary Capital, and will expressly waive any right to 

a higher payout priority, including, without limitation, 

the priority set forth in 12 C.F.R. § 709.5(b)(5) (or any 

successor provision).

Interest Rate: No interest accrues, nor will any interest be due for the 

first 24 months following the Closing Date. Interest will 

begin to accrue on the two-year anniversary of the 

Closing Date. The first quarterly payment will be due on 

the first interest payment date after that date. From the 

two-year anniversary of the Closing Date, interest 

payments will reflect the Credit Union’s Qualified 

Lending compared to the Baseline in accordance with the 

terms of the Securities Purchase Agreement.

Interest Payment Dates: Quarterly, in arrears, on March 15, June 15, September 

15 and December 15 of each year.

Restriction on Acceleration: Principal and interest may only become immediately due 

and payable (i.e., accelerated) upon the occurrence of an 

Event of Default. In addition, upon the occurrence of an 

Event of Default, the (i) accrual of interest after 

commencement of the Event of Default, and (ii) the 

payment of principal and interest, will be determined 

accordance with 12 U.S.C. § 1787 (or any successor 

provision) and the NCUA’s regulations in 12 C.F.R. Part 

709 (or any successor provision).
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

Securities Law Exemption for Subordinated Debt:

Please select appropriate exemption by checking the box:

Section 3(a)(5) exemption: ☐

Section 4(a)(2) exemption: ☐

Closing (by electronic exchange of documents):

Time of Closing:

Date of Closing:

Wire Information for Closing: ABA Number:

Bank:

Account Name:

Account Number:

Beneficiary:

Contact for Confirmation of Wire Information: 2

Address for Delivery of Subordinated Debt:

[Address]

[Address]

[Address]

Attention: [•]

Email tracking number for such mailing to: [•]

2

Include the name, title and contact information (telephone number and email address). The contact must be a 

person different from the officer executing the Letter Agreement.
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE B

CAPITALIZATION

Capitalization Date:

Capital Interests

Type of Interest (Member Shares, etc.):

Par Value:

Total Authorized:

Outstanding (aggregate dollar amount of Member Shares as of Capitalization Date):

Reserved for Issuance upon Conversion, Exercise or Exchange of Securities:

Remaining Authorized but Unissued:

Subordinated Debt:

Type:

Existing Parity Subordinated Debt:

Amount Outstanding:

Amount Qualifying as Grandfathered Secondary Capital:

Holders of 5% or more of Other Capital Instruments Primary Address

Potential Sales

Describe any commitments to authorize, issue or sell Capital Interests:

If none, please so indicate by checking the box: ☐.
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE C

MATERIAL ADVERSE EFFECT

List any exceptions to the representation and warranty in Section 3.1(g) of the Securities 

Purchase Agreement – Standard Terms.

If none, please so indicate by checking the box: ☐
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE D

LITIGATION

List any exceptions to the representation and warranty in Section 3.1(l) of the Securities 

Purchase Agreement – Standard Terms.

If none, please so indicate by checking the box: ☐
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE E

COMPLIANCE WITH LAWS

List any exceptions to the representation and warranty in the second sentence of Section 3.1(m) 

of the Securities Purchase Agreement – Standard Terms.

If none, please so indicate by checking the box: ☐

List any exceptions to the representation and warranty in the last sentence of Section 3.1(m) of 

the Securities Purchase Agreement – Standard Terms.

If none, please so indicate by checking the box: ☐
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE F

REGULATORY AGREEMENTS

List any exceptions to the representation and warranty in Section 3.1(s) of the Securities 

Purchase Agreement – Standard Terms.

If none, please so indicate by checking the box: ☐
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE G

RELATED PARTY TRANSACTIONS

List any exceptions to the representation and warranty in Section 3.1(x) of the Securities 

Purchase Agreement – Standard Terms.

If none, please so indicate by checking the box: ☐
FOR REFERENCE ONLY – NOT FOR EXECUTION – UPDATED 3.25.2022

SCHEDULE H

OTHER EXCEPTIONS

List any exceptions to the representations and warranties in the Securities Purchase Agreement –

Standard Terms not covered in Schedules C through G above and, for each listed exception, 

identify the applicable representation and warranty in Section 3.1 by the applicable subsection.

If none, please so indicate by checking the box: ☐