Exhibit 10.1


                    UNITED STATES DEPARTMENT OF THE TREASURY
                          1500 PENNSYLVANIA AVENUE, NW
                             WASHINGTON, D.C. 20220


Dear Ladies and Gentlemen:

         The company  set forth on the  signature  page  hereto (the  "Company")
intends to issue in a private  placement the number of shares of a series of its
preferred  stock set forth on Schedule A hereto (the  "Preferred  Shares") and a
warrant  to  purchase  the  number of shares  of its  common  stock set forth on
Schedule A hereto (the "Warrant" 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  confirm  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to the extent supplemented or superseded by the terms set forth herein or in the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  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 Company and the Investor hereby confirms its agreement with
the other party with  respect to the  issuance  by the Company of the  Purchased
Securities and the purchase by the Investor of the Purchased Securities 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)  and  the
Securities  Purchase  Agreement  (including the Annexes thereto) and the Warrant
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.  Executed
signature pages to this letter  agreement may be delivered by facsimile and such
facsimiles  will be deemed as sufficient as if actual  signature  pages had been
delivered.

                                      * * *


<PAGE>


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: ___________________________________________




               COMPANY:  SALISBURY BANCORP, INC.

               By: ______________________________________________
               Name: John F. Perotti
               Title:   Chairman and Chief Executive Officer



Dated:   March 13, 2009



<PAGE>


                                                                      SCHEDULE A
                         ADDITIONAL TERMS AND CONDITIONS
Company Information:

    Name of the Company:            SALISBURY BANCORP, INC.

    Corporate or other
     organizational form:           Corporation

    Jurisdiction of Organization:   Connecticut

    Appropriate Federal
     Banking Agency:                Federal Deposit Insurance Corporation

    Notice Information:             John F. Perotti
                                    Chairman and Chief Executive Officer
                                    5 Bissell Street
                                    Lakeville, CT 06039

Terms of the Purchase:

    Series of Preferred
     Stock Purchased:               Fixed Rate Cumulative Perpetual Preferred
                                    Stock, Series A

     Per Share Liquidation Preference
     of  Preferred Stock:           $1,000

    Number of Shares of Preferred
    Stock Purchased:                8,816

    Dividend Payment Dates on
    the Preferred Stock:            February 15, May 15, August 15, November 15

    Number of Initial
    Warrant Shares:                 57,671

    Exercise Price of the Warrant:  $22.93

    Purchase Price:                 $8,816,000

Closing:

    Location of Closing:            Hughes Hubbard.
                                    One Battery Park Plaza
                                    New York, NY 10004

    Time of Closing:                9:00 A.M., E.S.T.

    Date of Closing:                March 13, 2009

    Wire Information for Closing:           ABA Number:
                                            Bank:
                                            Account Name:
                                            Account Number:
                                            Beneficiary:


<PAGE>


                                                                      SCHEDULE B

                                 CAPITALIZATION

Capitalization Date:                                 February 28, 2009

Common Stock

     Par value:                                      $.10 per share

     Total authorized:                               3,000,000

     Outstanding:                                    1,685,861

     Subject to warrants, options, convertible
        securities, etc.:                            -0-

     Reserved for benefit plans and other
        issuances:                                   106,020

     Remaining authorized but unissued:              1,579,841

     Shares issued after Capitalization Date
        (other than pursuant to warrants, options,
        convertible securities, etc. as set forth
        above):                                      -0-



Preferred Stock                                     (as of March 10, 2009)

     Par value:                                      $.01 per share

     Total authorized:                               25,000

     Outstanding (by series):                        None

     Reserved for issuance:                          None

     Remaining authorized
        but unissued:                                25,000


<PAGE>


                                                                      SCHEDULE C

                         REQUIRED STOCKHOLDER APPROVALS

                                      Required(1)               % Vote Required



Warrants - Common Stock Issuance


Charter Amendment


Stock Exchange Rules


If no stockholder approvals are required, please so indicate by checking the
 box:   [x]


(1) If stockholder  approval is required,  indicate  applicable  class/series of
capital stock that are required to vote.


<PAGE>


                                                                      SCHEDULE D


                                   LITIGATION


List any exceptions to the  representation and warranty in Section 2.2(l) of the
Securities Purchase Agreement - Standard Terms.










If none, please so indicate by checking the box:  [x]


<PAGE>


                                                                      SCHEDULE E


                              COMPLIANCE WITH LAWS


List any exceptions to the representation and warranty in the second sentence of
Section 2.2(m) of the Securities Purchase Agreement - Standard Terms.












If none, please so indicate by checking the box:  [x]



List any exceptions to the  representation  and warranty in the last sentence of
Section 2.2(m) of the Securities Purchase Agreement - Standard Terms.












If none, please so indicate by checking the box:  [x]


<PAGE>


                                                                      SCHEDULE F


                              REGULATORY AGREEMENTS


List any exceptions to the  representation and warranty in Section 2.2(s) of the
Securities Purchase Agreement - Standard Terms.














If none, please so indicate by checking the box:  [x]


<PAGE>


                                                                       EXHIBIT A





      --------------------------------------------------------------------

                          SECURITIES PURCHASE AGREEMENT
                                 STANDARD TERMS
     -----------------------------------------------------------------------


<PAGE>

<TABLE>
<CAPTION>

                                TABLE OF CONTENTS
                                                                                        Page

                                    Article I

                                Purchase; Closing

<S>      <C>                                                                            <C>
1.1      Purchase........................................................................1
1.2      Closing.........................................................................2
1.3      Interpretation..................................................................4

                                   Article II

                         Representations and Warranties

2.1      Disclosure .....................................................................4
2.2      Representations and Warranties of the Company...................................5

                                   Article III

                                    Covenants

3.1      Commercially Reasonable Efforts................................................13
3.2      Expenses.......................................................................14
3.3      Sufficiency of Authorized Common Stock; Exchange Listing.......................14
3.4      Certain Notifications Until Closing............................................15
3.5      Access, Information and Confidentiality........................................15

                                   Article IV

                              Additional Agreements

4.1      Purchase for Investment........................................................16
4.2      Legends........................................................................16
4.3      Certain Transactions...........................................................18
4.4      Transfer of Purchase Securities and Warrant Shares; Restrictions on Exercise
         of the Warrant.................................................................18
4.5      Registration Rights............................................................19
4.6      Voting of Warrant Shares.......................................................30
4.7      Depository Shares..............................................................31
4.8      Restriction on Dividends and Repurchase........................................31
4.9      Repurchase of Investor Securities..............................................32
4.10     Executive Compensation.........................................................33

                                       i
<PAGE>


                                    Article V

                                  Miscellaneous

5.1      Termination....................................................................34
5.2      Survival of Representations and Warranties.....................................34
5.3      Amendment......................................................................34
5.4      Waiver of Conditions...........................................................34
5.5      Governing Law: Submission to Jurisdiction, Etc.................................35
5.6      Notices........................................................................35
5.7      Definitions....................................................................35
5.8      Assignment.....................................................................36
5.9      Severability...................................................................36
5.10     No Third Party Beneficiaries...................................................36


</TABLE>

                                       ii
<PAGE>


                                 LIST OF ANNEXES

ANNEX A: FORM OF CERTIFICATE OF DESIGNATIONS FOR PREFERRED STOCK

ANNEX B: FORM OF WAIVER

ANNEX C: FORM OF OPINION

ANNEX D: FORM OF WARRANT


                                      iii

<PAGE>





INDEX OF DEFINED TERMS

Location of
Term                                                              Definition
Affiliate                                                         5.7(b)
Agreement                                                         Recitals
Appraisal Procedure                                               4.9(c)(i)
Appropriate Federal Banking Agency                                2.2(s)
Bankruptcy Exceptions                                             2.2(d)
Benefit Plans                                                     1.2(d)(iv)
Board of Directors                                                2.2(f)
Business Combination                                              4.4
business day                                                      1.3
Capitalization Date                                               2.2(b)
Certificate of Designations                                       1.2(d)(iii)
Charter                                                           1.2(d)(iii)
Closing                                                           1.2(a)
Closing Date                                                      1.2(a)
Code                                                              2.2(n)
Common Stock                                                      Recitals
Company                                                           Recitals
Company Financial Statements                                      2.2(h)
Company Material Adverse Effect                                   2.1(a)
Company Reports                                                   2.2(i)(i)
Company Subsidiary; Company Subsidiaries                          2.2(i)(i)
control; controlled by; under common control with                 5.7(b)
Controlled Group                                                  2.2(n)
CPP                                                               Recitals
EESA                                                              1.2(d)(iv)
ERISA                                                             2.2(n)
Exchange Act                                                      2.1(b)
Fair Market Value                                                 4.9(c)(ii)
GAAP                                                              2.1(a)
Governmental Entities                                             1.2(c)
Holder                                                            4.5(k)(i)
Holders' Counsel                                                  4.5(k)(ii)
Indemnitee                                                        4.5(g)(i)
Information                                                       3.5(b)
Initial Warrant Shares                                            Recitals
Investor                                                           Recitals
Junior Stock                                                      4.8(c)
knowledge of the Company; Company's knowledge                     5.7(c)
Last Fiscal Year                                                  2.1(b)
Letter Agreement                                                  Recitals
officers                                                          5.7(c)

                                       iv
<PAGE>

Location of
Term                                                              Definition
Parity Stock                                                      4.8(c)
Pending Underwritten Offering                                     4.5(l)
Permitted Repurchases                                             4.8(a)(ii)
Piggyback Registrations                                           4.5(a)(iv)
Plan                                                              2.2(n)
Preferred Shares                                                  Recitals
Preferred Stock                                                   Recitals
Previously Disclosed                                              2.1(b)
Proprietary Rights                                                2.2(u)
Purchase                                                          Recitals
Purchase Price                                                    1.1
Purchased Securities                                              Recitals
Qualified Equity Offering                                         4.4
Register; registered; registration                                4.5(k)(iii)
Registrable Securities                                            4.5(k)(iv)
Registration Expenses                                             4.5(k)(v)
Regulatory Agreement                                              2.2(s)
Rule 144; Rule 144A; Rule 159A; Rule 405; Rule 415                4.5(k)(vi)
Schedules                                                         Recitals
SEC                                                               2.1(b)
Securities Act                                                    2.2(a)
Selling Expenses                                                  4.5(k)(vii)
Senior Executive Officers                                         4.10
Share Dilution Amount                                             4.8(a)(ii)
Shelf Registration Statement                                      4.5(a)(ii)
Signing Date                                                      2.1(a)
Special Registration                                              4.5(i)
Stockholder Proposals                                             3.1(b)
Subsidiary                                                        5.7(a)
Tax; Taxes                                                        2.2(o)
Transfer                                                          4.4
Warrant                                                           Recitals
Warrant Shares                                                    2.2(d)

                                       v

<PAGE>


                 SECURITIES PURCHASE AGREEMENT - STANDARD TERMS

                                    Recitals:

         WHEREAS,  the United States Department of the Treasury (the "Investor")
may from time to time agree to purchase  shares of preferred  stock and warrants
from eligible financial  institutions which elect to participate in the Troubled
Asset Relief Program Capital Purchase Program ("CPP");

         WHEREAS, an eligible financial  institution  electing to participate in
the  CPP and  issue  securities  to the  Investor  (referred  to  herein  as the
"Company") shall enter into a letter agreement (the "Letter Agreement") with the
Investor which incorporates this Securities Purchase Agreement - Standard Terms;

         WHEREAS,  the  Company  agrees  to  expand  the flow of  credit to U.S.
consumers and  businesses on competitive  terms to promote the sustained  growth
and vitality of the U.S. economy;

         WHEREAS,  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
of shares of the series of its Preferred Stock ("Preferred  Stock") set forth on
Schedule A to the Letter  Agreement  (the  "Preferred  Shares") and a warrant to
purchase the number of shares of its Common Stock ("Common  Stock") set forth on
Schedule A to the Letter Agreement (the "Initial Warrant Shares") (the "Warrant"
and,  together with the Preferred  Shares,  the "Purchased  Securities") and the
Investor  intends to purchase  (the  "Purchase")  from the Company the Purchased
Securities; and

         WHEREAS,  the  Purchase  will be governed by this  Securities  Purchase
Agreement - Standard  Terms and the Letter  Agreement,  including  the schedules
thereto (the  "Schedules"),  specifying  additional terms of the Purchase.  This
Securities  Purchase  Agreement - Standard Terms  (including the Annexes hereto)
and the Letter Agreement (including the Schedules thereto) are together referred
to as this "Agreement".  All references in this Securities  Purchase Agreement -
Standard  Terms to  "Schedules"  are to the  Schedules  attached  to the  Letter
Agreement.

         NOW,  THEREFORE,   in  consideration  of  the  premises,   and  of  the
representations,  warranties,  covenants and  agreements  set forth herein,  the
parties agree as follows:

                                    Article I
                                Purchase; Closing

         1.1    Purchase. On the terms and subject to the conditions set forth
in this Agreement,  the Company agrees to sell to the Investor, and the Investor
agrees to purchase from the Company,  at the Closing (as  hereinafter  defined),
the Purchased  Securities  for the price set forth on Schedule A (the  "Purchase
Price").

                                       1
<PAGE>

         1.2    Closing.

         (a) On the  terms  and  subject  to the  conditions  set  forth in this
Agreement,  the closing of the Purchase (the  "Closing")  will take place at the
location  specified  in  Schedule  A, at the time  and on the date set  forth in
Schedule A or as soon as practicable  thereafter,  or at such other place,  time
and date as shall be agreed  between the Company and the Investor.  The time and
date on which  the  Closing  occurs  is  referred  to in this  Agreement  as the
"Closing Date".

         (b)  Subject  to the  fulfillment  or waiver of the  conditions  to the
Closing in this  Section  1.2,  at the  Closing  the  Company  will  deliver the
Preferred  Shares  and the  Warrant,  in each case as  evidenced  by one or more
certificates  dated  the  Closing  Date  and  bearing   appropriate  legends  as
hereinafter  provided for, in exchange for payment in full of the Purchase Price
by wire transfer of immediately  available United States funds to a bank account
designated by the Company on Schedule A.

         (c) The respective  obligations of each of the Investor and the Company
to  consummate  the  Purchase are subject to the  fulfillment  (or waiver 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 form and substance reasonably satisfactory to each party and
shall be in full force and effect and all  waiting  periods  required  by United
States  and  other  applicable  law,  if any,  shall  have  expired  and (ii) no
provision  of any  applicable  United  States  or  other  law  and no  judgment,
injunction,  order or decree  of any  Governmental  Entity  shall  prohibit  the
purchase and sale of the Purchased Securities as contemplated by this Agreement.

         (d) The  obligation of the Investor to consummate  the Purchase is also
subject  to the  fulfillment  (or  waiver  by the  Investor)  at or prior to the
Closing of each of the following conditions:

                  (i) (A) the  representations and warranties of the Company set
         forth in (x) Section 2.2(g) of this Agreement shall be true and correct
         in all  respects  as though  made on and as of the  Closing  Date,  (y)
         Sections  2.2(a)  through (f) shall be true and correct in all material
         respects  as though  made on and as of the  Closing  Date  (other  than
         representations  and warranties that by their terms speak as of another
         date, which representations and warranties shall be true and correct in
         all material  respects as of such other date) and (z)  Sections  2.2(h)
         through (v) (disregarding  all  qualifications or limitations set forth
         in such  representations  and warranties as to "materiality",  "Company
         Material Adverse Effect" and words of similar import) shall be true and
         correct  as  though  made on and as of the  Closing  Date  (other  than
         representations  and warranties that by their terms speak as of another
         date, which representations and warranties shall be true and correct as
         of such  other  date),  except to the extent  that the  failure of such
         representations   and   warranties   referred   to  in   this   Section
         1.2(d)(i)(A)(z)  to be so  true  and  correct,  individually  or in the

                                       2
<PAGE>

         aggregate, does not have and would not reasonably be expected to have a
         Company  Material  Adverse  Effect  and  (B)  the  Company  shall  have
         performed  in all  material  respects  all  obligations  required to be
         performed by it under this Agreement at or prior to the Closing;

                  (ii) the Investor shall have received a certificate  signed on
         behalf of the Company by a senior executive  officer  certifying to the
         effect that the  conditions  set forth in Section  1.2(d)(i)  have been
         satisfied;

                  (iii) the Company  shall have duly  adopted and filed with the
         Secretary  of  State  of its  jurisdiction  of  organization  or  other
         applicable  Governmental  Entity the  amendment to its  certificate  or
         articles  of  incorporation,   articles  of  association,   or  similar
         organizational  document ("Charter") in substantially the form attached
         hereto as Annex A (the "Certificate of  Designations")  and such filing
         shall have been accepted;

                  (iv) (A) the Company  shall have  effected such changes to its
         compensation,  bonus,  incentive and other benefit plans,  arrangements
         and agreements  (including golden  parachute,  severance and employment
         agreements) (collectively,  "Benefit Plans") with respect to its Senior
         Executive  Officers (and to the extent necessary for such changes to 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 owns any debt or equity  securities of the
         Company acquired pursuant to this Agreement or the Warrant, in order to
         comply with Section 111(b) of the Emergency Economic  Stabilization Act
         of 2008 ("EESA") as  implemented  by guidance or regulation  thereunder
         that has been issued and is in effect as of the Closing  Date,  and (B)
         the Investor shall have received a certificate  signed on behalf of the
         Company by a senior executive officer certifying to the effect that the
         condition set forth in Section 1.2(d)(iv)(A) has been satisfied;

                  (v) each of the Company's Senior Executive Officers shall have
         delivered to the Investor a written waiver in the form attached  hereto
         as Annex B  releasing  the  Investor  from any claims  that such Senior
         Executive  Officers may otherwise have as a result of the issuance,  on
         or prior to the Closing  Date,  of any  regulations  which  require the
         modification of, and the agreement of the Company  hereunder to modify,
         the terms of any  Benefit  Plans with  respect to its Senior  Executive
         Officers to eliminate  any  provisions of such Benefit Plans that would
         not be in compliance  with the  requirements  of Section  111(b) of the
         EESA as implemented by guidance or regulation  thereunder that has been
         issued and is in effect as of the Closing Date;

                  (vi) the  Company  shall  have  delivered  to the  Investor  a
         written  opinion  from  counsel to the  Company  (which may be internal
         counsel),  addressed to the Investor and dated as of the Closing  Date,
         in substantially the form attached hereto as Annex C;

                  (vii) the Company shall have delivered  certificates in proper
         form or, with the prior consent of the Investor,  evidence of shares in
         book-entry  form,  evidencing  the Preferred  Shares to Investor or its
         designee(s); and

                                       3
<PAGE>

                  (viii) the  Company  shall have duly  executed  the Warrant in
         substantially  the form attached  hereto as Annex D and delivered  such
         executed Warrant to the Investor or its designees(s).

         1.3    Interpretation.  When a reference is made in this Agreement to
"Recitals,"  "Articles,"  "Sections," or "Annexes" such reference  shall be to a
Recital,  Article or Section of, or Annex to, this Securities Purchase Agreement
- Standard Terms,  and a reference to "Schedules"  shall be to a Schedule to the
Letter Agreement, in each case, unless otherwise indicated. The terms defined in
the singular have a comparable  meaning when used in the plural, and vice versa.
References  to  "herein",  "hereof",  "hereunder"  and the  like  refer  to this
Agreement as a whole and not to any particular section or provision,  unless the
context requires otherwise. The table of contents and headings contained in this
Agreement  are for reference  purposes only and are not part of this  Agreement.
Whenever  the  words  "include,"  "includes"  or  "including"  are  used in this
Agreement,  they shall be deemed followed by the words "without  limitation." No
rule of  construction  against the  draftsperson  shall be applied in connection
with the  interpretation or enforcement of this Agreement,  as this Agreement is
the product of negotiation between sophisticated parties advised by counsel. All
references to "$" or "dollars" mean the lawful  currency of the United States of
America.  Except as expressly  stated in this  Agreement,  all references to any
statute,  rule or regulation are to the statute,  rule or regulation as amended,
modified,  supplemented  or  replaced  from  time to time  (and,  in the case of
statutes,  include any rules and regulations  promulgated under the statute) and
to any section of any statute,  rule or regulation  include any successor to the
section.  References  to a  "business  day" shall mean any day except  Saturday,
Sunday  and any day on  which  banking  institutions  in the  State  of New York
generally  are  authorized or required by law or other  governmental  actions to
close.

                                   Article II

                         Representations and Warranties

         2.1     Disclosure.

         (a)     "Company  Material  Adverse Effect" means a material  adverse
effect on (i) the business,  results of operation or financial  condition of the
Company and its consolidated  subsidiaries taken as a whole; provided,  however,
that Company  Material Adverse Effect shall not be deemed to include the effects
of (A) changes after the date of the Letter  Agreement  (the "Signing  Date") in
general business,  economic or market conditions (including changes generally in
prevailing interest rates, credit availability and liquidity,  currency exchange
rates and price  levels or  trading  volumes  in the  United  States or  foreign
securities or credit  markets),  or any outbreak or  escalation of  hostilities,
declared  or  undeclared  acts  of war or  terrorism,  in  each  case  generally
affecting the industries in which the Company and its subsidiaries  operate, (B)
changes  or  proposed  changes  after the  Signing  Date in  generally  accepted
accounting  principles  in the United States  ("GAAP") or regulatory  accounting
requirements,  or authoritative interpretations thereof, (C) changes or proposed
changes after the Signing Date in securities,  banking and other laws of general
applicability or related policies or  interpretations  of Governmental  Entities
(in the case of each of these  clauses (A),  (B) and (C),  other than changes or
occurrences  to the  extent  that  such  changes  or  occurrences  have or would

                                       4
<PAGE>

reasonably be expected to have a materially  disproportionate  adverse effect on
the  Company  and its  consolidated  subsidiaries  taken as a whole  relative to
comparable U.S. banking or financial services organizations),  or (D) changes in
the market  price or trading  volume of the  Common  Stock or any other  equity,
equity-related   or  debt   securities  of  the  Company  or  its   consolidated
subsidiaries  (it being  understood  and agreed that the  exception set 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  Company  to
consummate  the  Purchase  and  the  other  transactions  contemplated  by  this
Agreement and the Warrant and perform its obligations hereunder or thereunder on
a timely basis.

         (b)        "Previously   Disclosed"  means  information  set  forth  or
incorporated  in the Company's  Annual Report on Form 10-K for the most recently
completed  fiscal year of the Company  filed with the  Securities  and  Exchange
Commission  (the "SEC") prior to the Signing Date (the "Last Fiscal Year") or in
its other  reports and forms filed with or furnished  to the SEC under  Sections
13(a),  14(a) or 15(d) of the  Securities  Exchange  Act of 1934 (the  "Exchange
Act") on or after the last day of the Last  Fiscal Year and prior to the Signing
Date.

         2.2     Representations  and  Warranties  of the  Company.  Except  as
Previously  Disclosed,  the Company represents and warrants to the Investor that
as of the Signing Date and as of the Closing Date (or such other date  specified
herein):

         (a)     Organization,  Authority  and  Significant  Subsidiaries.  The
Company has been duly  incorporated and is validly existing and in good standing
under the laws of its jurisdiction of organization, with the necessary power and
authority  to own 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  under the laws of each other
jurisdiction  in which it owns or leases  properties or conducts any business so
as to require  such  qualification;  each  subsidiary  of the Company  that is a
"significant  subsidiary"  within the meaning of Rule 1-02(w) of Regulation  S-X
under the Securities Act of 1933 (the "Securities  Act") has been duly organized
and is validly  existing in good standing under the laws of its  jurisdiction of
organization.  The Charter and bylaws of the Company,  copies of which have been
provided to the  Investor  prior to the Signing  Date,  are true,  complete  and
correct  copies of such  documents as in full force and effect as of the Signing
Date.

         (b)      Capitalization.  The authorized  capital stock of the Company,
and  the  outstanding  capital  stock  of  the  Company  (including   securities
convertible  into, or  exercisable  or  exchangeable  for,  capital stock of the
Company) as of the most recent fiscal month-end  preceding the Signing Date (the
"Capitalization  Date") is set forth on  Schedule B. The  outstanding  shares of
capital stock of the Company have been duly  authorized  and are validly  issued
and  outstanding,  fully paid and  nonassessable,  and subject to no  preemptive
rights (and were not issued in violation of any  preemptive  rights).  Except as
provided in the  Warrant,  as of the  Signing  Date,  the Company  does not have
outstanding any securities or other  obligations  providing the holder the right
to acquire  Common  Stock that is not  reserved  for  issuance as  specified  on
Schedule  B, and the  Company has not made any other  commitment  to  authorize,
issue or sell any Common Stock. Since the  Capitalization  Date, the Company has
not issued

                                       5
<PAGE>

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 which were issued and  outstanding on the  Capitalization
Date and disclosed on Schedule B and (ii) shares disclosed on Schedule B.

         (c)     Preferred  Shares.  The  Preferred  Shares  have been duly and
validly  authorized,  and, when issued and delivered pursuant to this Agreement,
such  Preferred  Shares  will be duly and  validly  issued  and  fully  paid and
non-assessable,  will not be issued in violation of any preemptive  rights,  and
will rank pari passu with or senior to all other  series or classes of Preferred
Stock,  whether or not issued or  outstanding,  with  respect to the  payment of
dividends  and the  distribution  of  assets  in the  event of any  dissolution,
liquidation or winding up of the Company.

         (d)     The  Warrant  and  Warrant  Shares.  The Warrant has been duly
authorized  and,  when  executed and  delivered  as  contemplated  hereby,  will
constitute a valid and legally  binding  obligation  of the Company  enforceable
against  the  Company in  accordance  with its terms,  except as the same may be
limited by  applicable  bankruptcy,  insolvency,  reorganization,  moratorium or
similar laws  affecting  the  enforcement  of  creditors'  rights  generally and
general  equitable  principles,  regardless  of whether such  enforceability  is
considered in a proceeding at law or in equity  ("Bankruptcy  Exceptions").  The
shares of Common  Stock  issuable  upon  exercise of the Warrant  (the  "Warrant
Shares")  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 will
be validly issued, fully paid and non-assessable, subject, if applicable, to the
approvals of its stockholders set forth on Schedule C.

         (e)     Authorization, Enforceability.

                  (i) The  Company  has the  corporate  power and  authority  to
         execute and deliver this  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  thereunder  (which
         includes  the  issuance of the  Preferred  Shares,  Warrant and Warrant
         Shares). The execution, delivery and performance by the Company of this
         Agreement  and the Warrant  and the  consummation  of the  transactions
         contemplated  hereby  and  thereby  have  been duly  authorized  by all
         necessary  corporate  action  on  the  part  of  the  Company  and  its
         stockholders,  and no further  approval or authorization is required on
         the part of the Company,  subject, in each case, if applicable,  to the
         approvals of its  stockholders  set forth on Schedule C. This Agreement
         is a valid and binding  obligation of the Company  enforceable  against
         the Company in  accordance  with its terms,  subject to the  Bankruptcy
         Exceptions.

                  (ii) The execution, delivery and performance by the Company of
         this Agreement and the Warrant and the consummation of the transactions
         contemplated  hereby and thereby and compliance by the Company with the
         provisions hereof and thereof, will not (A) violate,  conflict with, or
         result in a breach of any  provision of, or constitute a default (or an
         event which,  with notice or lapse of time or both,  would constitute a
         default)  under,  or result in the  termination  of, or accelerate  the
         performance  required  by,  or  result  in a right  of  termination  or
         acceleration  of, or  result in the  creation  of,  any lien,  security
         interest, charge or encumbrance upon any of the properties or assets of
         the  Company  or  any  Company  Subsidiary  under  any  of  the  terms,

                                       6
<PAGE>

         conditions  or  provisions  of  (i)  subject,  if  applicable,  to  the
         approvals of the  Company's  stockholders  set forth on Schedule C, its
         organizational  documents or (ii) any note, bond, mortgage,  indenture,
         deed of  trust,  license,  lease,  agreement  or  other  instrument  or
         obligation to which the Company or any Company Subsidiary is a party or
         by which it or any  Company  Subsidiary  may be bound,  or to which the
         Company or any Company Subsidiary or any of the properties or assets of
         the Company or any Company Subsidiary may be subject, or (B) subject to
         compliance  with the statutes and  regulations  referred to in the next
         paragraph,  violate any statute,  rule or  regulation  or any judgment,
         ruling,  order, writ, injunction or decree applicable to the Company or
         any Company Subsidiary or any of their respective  properties or assets
         except,  in the case of clauses (A)(ii) and (B), for those  occurrences
         that,  individually  or in the  aggregate,  have not had and  would not
         reasonably be expected to have a Company Material Adverse Effect.

                  (iii) Other than the filing of the Certificate of Designations
         with the  Secretary of State of its  jurisdiction  of  organization  or
         other applicable  Governmental  Entity,  any current 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
         filing of any proxy  statement  contemplated by Section 3.1 and such as
         have been made or obtained,  no notice to,  filing  with,  exemption or
         review by, or  authorization,  consent or approval of, any Governmental
         Entity is required to be made or obtained by the Company in  connection
         with the  consummation  by the Company of the  Purchase  except for any
         such notices, filings, exemptions,  reviews,  authorizations,  consents
         and  approvals  the  failure  of which  to make or  obtain  would  not,
         individually  or in the  aggregate,  reasonably  be  expected to have a
         Company Material Adverse Effect.

         (f)     Anti-takeover   Provisions  and  Rights  Plan.  The  Board  of
Directors  of the Company  (the "Board of  Directors")  has taken all  necessary
action to ensure that the  transactions  contemplated  by this Agreement and the
Warrant  and  the  consummation  of the  transactions  contemplated  hereby  and
thereby,  including  the exercise of the Warrant in  accordance  with its terms,
will be exempt from any  anti-takeover  or similar  provisions  of the Company's
Charter and bylaws,  and any other  provisions of any  applicable  "moratorium",
"control share", "fair price",  "interested  stockholder" or other anti-takeover
laws and  regulations  of any  jurisdiction.  The  Company has taken all actions
necessary to render any stockholders' rights plan of the Company inapplicable to
this  Agreement  and  the  Warrant  and  the  consummation  of the  transactions
contemplated  hereby and thereby,  including  the exercise of the Warrant by the
Investor in accordance with its terms.

         (g)     No Company Material Adverse Effect.  Since the last day of the
last completed  fiscal period for which the Company has filed a Quarterly Report
on Form 10-Q or an Annual  Report on Form 10-K with the SEC prior to the Signing
Date, no fact, circumstance, event, change, occurrence, condition or development
has occurred that, individually or in the aggregate, has had or would reasonably
be expected to have a Company Material Adverse Effect.

                                       7
<PAGE>

         (h)     Company   Financial  Statements.   Each  of  the  consolidated
financial   statements  of  the  Company  and  its   consolidated   subsidiaries
(collectively the "Company  Financial  Statements")  included or incorporated by
reference  in the Company  Reports  filed with the SEC since  December 31, 2006,
present fairly in all material respects the consolidated  financial  position of
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;
and except as stated  therein,  such  financial  statements (A) were prepared in
conformity  with GAAP  applied  on a  consistent  basis  (except as may be noted
therein), (B) have been prepared from, and are in accordance with, the books and
records of the Company and the Company Subsidiaries and (C) complied as to form,
as of their  respective  dates of filing with the SEC, in all material  respects
with the applicable  accounting  requirements  and with the published  rules and
regulations of the SEC with respect thereto.

         (i)     Reports.

                  (i) Since December 31, 2006,  the Company and each  subsidiary
         of the Company  (each a "Company  Subsidiary"  and,  collectively,  the
         "Company  Subsidiaries")  has timely filed all reports,  registrations,
         documents,  filings,  statements  and  submissions,  together  with any
         amendments thereto,  that it was required to file with any Governmental
         Entity (the  foregoing,  collectively,  the "Company  Reports") and has
         paid all fees and assessments due and payable in connection  therewith,
         except,  in each case, as would not,  individually or in the aggregate,
         reasonably be expected to have a Company Material Adverse Effect. As 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 fact 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  material  respects  with  the  applicable
         requirements  of the  Securities Act and the Exchange Act. With respect
         to all other  Company  Reports,  the Company  Reports were complete and
         accurate in all  material  respects as of their  respective  dates.  No
         executive  officer of the Company or any Company  Subsidiary has failed
         in any respect to make the certifications  required of him or her under
         Section 302 or 906 of the Sarbanes-Oxley Act of 2002.

                  (ii) The records,  systems,  controls, data and information of
         the  Company  and  the  Company  Subsidiaries  are  recorded,   stored,
         maintained  and  operated  under  means   (including  any   electronic,
         mechanical or photographic  process,  whether computerized or not) that
         are under the exclusive  ownership and direct control of the Company or
         the Company  Subsidiaries or their accountants  (including all means of
         access thereto and therefrom),  except for any non-exclusive  ownership
         and non-direct  control that would not reasonably be expected to have a
         material adverse effect on the system of internal  accounting  controls
         described  below  in  this  Section  2.2(i)(ii).  The  Company  (A) has
         implemented  and  maintains  disclosure  controls  and  procedures  (as
         defined in Rule  13a-15(e) of the Exchange Act) to ensure that material
         information relating to the Company, including the consolidated Company
         Subsidiaries,  is made  known to the chief  executive  officer  and the
         chief financial officer of the Company by others within those entities,
         and (B) has disclosed, based on its most recent evaluation prior to the
         Signing Date, to the Company's outside auditors and the audit committee
         of the Board of Directors (x) any significant deficiencies and material
         weaknesses  in the  design  or  operation  of  internal  controls  over
         financial  reporting (as defined in Rule 13a-15(f) of the Exchange Act)

                                       8
<PAGE>

         that are reasonably likely to adversely affect the Company's ability to
         record, process, summarize and report financial information and (y) any
         fraud,  whether or not  material,  that  involves  management  or other
         employees  who  have  a  significant  role  in the  Company's  internal
         controls over financial reporting.

         (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 be so
reflected  or  reserved  against  in  accordance  with  GAAP,   except  for  (A)
liabilities  that have arisen since the last fiscal year 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)     Offering  of  Securities.  Neither  the Company nor any person
acting on its  behalf  has taken  any  action  (including  any  offering  of any
securities  of  the  Company  under   circumstances   which  would  require  the
integration  of  such  offering  with  the  offering  of any  of  the  Purchased
Securities  under the Securities  Act, and the rules and  regulations of the SEC
promulgated thereunder),  which might subject 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.

         (l)     Litigation  and Other Proceedings.  Except (i) as set forth on
Schedule D or (ii) as would not, individually or in the aggregate, reasonably be
expected to have a Company Material Adverse Effect,  there is no (A) pending or,
to the knowledge of the Company, threatened,  claim, action, suit, investigation
or proceeding,  against the Company or any Company Subsidiary or to which any of
their assets are subject nor is the Company or any Company Subsidiary subject to
any  order,  judgment  or  decree  or (B)  unresolved  violation,  criticism  or
exception by any  Governmental  Entity with respect to any report or relating to
any examinations or inspections of the Company or any Company Subsidiaries.

         (m)     Compliance  with Laws. Except as would not, individually or in
the aggregate, reasonably be expected to have a Company Material Adverse Effect,
the Company and the Company Subsidiaries have all permits, licenses, franchises,
authorizations, orders and approvals of, and have made all filings, applications
and  registrations  with,  Governmental  Entities  that are required in order to
permit  them to own or lease their  properties  and assets and to carry on their
business as  presently  conducted  and that are  material to the business of the
Company  or such  Company  Subsidiary.  Except as set forth on  Schedule  E, the

                                       9
<PAGE>

Company and the Company  Subsidiaries  have complied in all respects and are not
in  default  or  violation  of,  and none of them is,  to the  knowledge  of the
Company,  under  investigation  with  respect  to or,  to the  knowledge  of the
Company,  have  been  threatened  to be  charged  with or  given  notice  of any
violation of, any applicable domestic (federal,  state or local) or foreign law,
statute,  ordinance,  license,  rule,  regulation,  policy or guideline,  order,
demand, writ,  injunction,  decree or judgment of any Governmental Entity, other
than such noncompliance,  defaults or violations that would not, individually or
in the  aggregate,  reasonably  be expected to have a Company  Material  Adverse
Effect.  Except for statutory or regulatory  restrictions of general application
or as set forth on Schedule E, no Governmental Entity has placed any restriction
on the  business or  properties  of the Company or any Company  Subsidiary  that
would,  individually  or in the  aggregate,  reasonably  be  expected  to have a
Company Material Adverse Effect.

         (n)     Employee  Benefit  Matters.  Except as would not reasonably be
expected to have,  either  individually or in the aggregate,  a Company Material
Adverse Effect:  (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  within the
meaning of Section 414 of the  Internal  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 would have any liability, whether actual or contingent (each, a
"Plan")  has  been  maintained  in  compliance  with  its  terms  and  with  the
requirements of all applicable statutes, rules and regulations,  including ERISA
and the  Code;  (B)  with  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), (1) no
"reportable event" (within the meaning of Section 4043(c) of ERISA),  other than
a reportable event for which the notice period referred to in Section 4043(c) of
ERISA has been waived, has occurred in the three years prior to the Signing Date
or is reasonably  expected to occur,  (2) no  "accumulated  funding  deficiency"
(within the meaning of Section 302 of ERISA or Section 412 of the Code), whether
or not waived,  has  occurred in the three years prior to the Signing Date or is
reasonably expected to occur, (3) the fair market value of the assets under each
Plan  exceeds  the  present  value  of all  benefits  accrued  under  such  Plan
(determined based on the assumptions used to fund such Plan) and (4) neither the
Company  nor any member of its  Controlled  Group has  incurred in the six years
prior to the Signing Date, or reasonably  expects to incur,  any liability under
Title IV of ERISA (other than  contributions to the Plan or premiums to the PBGC
in the ordinary course and without  default) in respect of a Plan (including any
Plan that is a "multiemployer plan", within the meaning of Section 4001(c)(3) of
ERISA);  and (C) each Plan that is intended to be qualified under Section 401(a)
of the Code has  received a favorable  determination  letter  from the  Internal
Revenue Service with respect to its qualified  status that has not been revoked,
or such a  determination  letter has been timely applied for but not received by
the Signing Date,  and nothing has occurred,  whether by action or by failure to
act, which could reasonably be expected to cause the loss,  revocation or denial
of such qualified status or favorable determination letter.

         (o)     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  Subsidiaries have filed all federal,  state,  local and

                                       10
<PAGE>

foreign  income and  franchise  Tax  returns  required  to be filed  through the
Signing  Date,  subject  to  permitted  extensions,  and have paid all Taxes due
thereon, and (ii) no Tax deficiency has been determined adversely to the Company
or any of the Company  Subsidiaries,  nor does the Company have any knowledge of
any Tax  deficiencies.  "Tax" or  "Taxes"  means any  federal,  state,  local or
foreign  income,  gross  receipts,   property,   sales,  use,  license,  excise,
franchise,  employment, payroll, withholding,  alternative or add on minimum, ad
valorem,  transfer or excise tax, or any other tax, custom,  duty,  governmental
fee or other like assessment or charge of any kind whatsoever, together with any
interest or penalty, imposed by any Governmental 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 all other  properties and assets owned by them, in each case
free from liens,  encumbrances,  claims and defects  that would affect the value
thereof or interfere with the use made or to be made thereof by them.  Except as
would not,  individually  or in the aggregate,  reasonably be expected to have a
Company Material Adverse Effect,  the Company and the Company  Subsidiaries hold
all leased real or personal property under valid and enforceable  leases with no
exceptions that would interfere with the use made or to be made thereof by them.

         (q)     Environmental  Liability. Except as would not, individually or
in the  aggregate,  reasonably  be expected to have a Company  Material  Adverse
Effect:

                  (i) there is no legal,  administrative,  or other  proceeding,
         claim  or  action  of any  nature  seeking  to  impose,  or that  would
         reasonably be expected to result in the  imposition  of, on the Company
         or any Company  Subsidiary,  any  liability  relating to the release of
         hazardous  substances  as  defined  under any  local,  state or federal
         environmental   statute,   regulation  or   ordinance,   including  the
         Comprehensive Environmental Response, Compensation and Liability Act of
         1980,  pending or, to the Company's  knowledge,  threatened against the
         Company or any Company Subsidiary;

                  (ii) to the Company's knowledge,  there is no reasonable basis
         for any such proceeding, claim or action; and

                  iii) neither the Company nor any Company Subsidiary is subject
         to any  agreement,  order,  judgment  or decree  by or with any  court,
         Governmental  Entity or third  party  imposing  any such  environmental
         liability.

         (r)     Risk Management Instruments. Except as would not, individually
or in the aggregate,  reasonably be expected to have a Company  Material Adverse
Effect, all derivative  instruments,  including,  swaps, caps, floors and option
agreements,  whether  entered into for the  Company's  own  account,  or for the
account of one or more of the Company  Subsidiaries  or its or their  customers,
were  entered  into  (i)  only  in the  ordinary  course  of  business,  (ii) in
accordance  with  prudent  practices  and  in all  material  respects  with  all
applicable  laws,  rules,  regulations  and  regulatory  policies and (iii) with
counterparties  believed to be financially  responsible at the time; and each of
such  instruments  constitutes the valid and legally  binding  obligation of the
Company or one of the Company  Subsidiaries,  enforceable in accordance with its
terms,  except as may be  limited  by the  Bankruptcy  Exceptions.  Neither  the
Company or the Company  Subsidiaries,  nor, to the knowledge of the Company, any

                                       11
<PAGE>

other  party  thereto,  is in  breach of any of its  obligations  under any such
agreement or arrangement  other than such breaches that would not,  individually
or in the aggregate,  reasonably be expected to have a Company  Material Adverse
Effect.

         (s)     Agreements  with Regulatory  Agencies.  Except as set forth on
Schedule F,  neither the  Company nor any Company  Subsidiary  is subject to any
material  cease-and-desist  or other similar order or enforcement  action issued
by,  or is a party to any  material  written  agreement,  consent  agreement  or
memorandum  of  understanding  with, or is a party to any  commitment  letter or
similar  undertaking  to, or is subject to any  capital  directive  by, or since
December  31,  2006,  has adopted any board  resolutions  at the request of, any
Governmental  Entity (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
material  manner  relates to its capital  adequacy,  its  liquidity  and funding
policies  and  practices,  its  ability  to  pay  dividends,  its  credit,  risk
management or compliance  policies or  procedures,  its internal  controls,  its
management  or its  operations  or  business  (each  item  in this  sentence,  a
"Regulatory  Agreement"),  nor has the  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  are in  compliance  in all
material  respects  with  each  Regulatory  Agreement  to  which  it is party or
subject,  and neither the Company nor any Company  Subsidiary  has  received any
notice from any  Governmental  Entity  indicating that either the Company or any
Company  Subsidiary is not in compliance in all material  respects with any such
Regulatory   Agreement.   "Appropriate   Federal   Banking   Agency"  means  the
"appropriate Federal banking agency" with respect to the Company or such Company
Subsidiaries,  as applicable,  as defined in Section 3(q) of the Federal Deposit
Insurance Act (12 U.S.C. Section 1813(q)).

         (t)     Insurance.  The  Company  and  the  Company  Subsidiaries  are
insured with  reputable  insurers  against such risks and in such amounts as the
management of the Company reasonably has determined to be prudent and consistent
with industry practice. The Company and the Company Subsidiaries are in material
compliance with their insurance policies and are not in default under any of the
material  terms thereof,  each such policy is outstanding  and in full force and
effect,  all premiums and other payments due under any material policy have been
paid,  and all claims  thereunder  have been  filed in due and  timely  fashion,
except, in each case, as would not, individually or in the aggregate, reasonably
be expected to have a Company Material Adverse Effect.

         (u)     Intellectual Property. Except as would not, individually or in
the aggregate, reasonably be expected to have a Company Material Adverse Effect,
(i) the Company and each Company  Subsidiary  owns or otherwise has the right to
use, all intellectual  property rights,  including all trademarks,  trade dress,
trade names, service marks, domain names,  patents,  inventions,  trade secrets,
know-how,  works of  authorship  and  copyrights  therein,  that are used in the
conduct  of their  existing  businesses  and all rights  relating  to the plans,
design and specifications of any of its branch facilities ("Proprietary Rights")
free and clear of all liens and any  claims of  ownership  by  current or former
employees, contractors, designers or others and (ii) neither the Company nor any
of the Company Subsidiaries is materially infringing, diluting, misappropriating

                                       12
<PAGE>

or violating,  nor has the Company or any or the Company  Subsidiaries  received
any written (or, to the knowledge of the Company, oral) communications  alleging
that any of them has materially infringed, diluted, misappropriated or violated,
any of the  Proprietary  Rights owned by any other person.  Except as would not,
individually  or in the  aggregate,  reasonably  be  expected  to have a Company
Material  Adverse  Effect,  to the  Company's  knowledge,  no  other  person  is
infringing, diluting,  misappropriating or violating, nor has the Company or any
or the Company  Subsidiaries  sent any written  communications  since January 1,
2006  alleging  that any  person  has  infringed,  diluted,  misappropriated  or
violated,  any of the  Proprietary  Rights  owned by the Company and the Company
Subsidiaries.

         (v)     Brokers and Finders. No broker, finder 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 commercially  reasonable efforts in good faith to take,
or cause to be taken,  all actions,  and to do, or cause to be done,  all things
necessary,  proper or desirable,  or advisable under  applicable  laws, so as to
permit  consummation of the Purchase as promptly as practicable and otherwise to
enable  consummation  of the  transactions  contemplated  hereby  and  shall use
commercially reasonable efforts to cooperate with the other party to that end.

         (b)      If the Company is required to obtain any stockholder approvals
set forth on Schedule C, then the Company shall comply with this Section  3.1(b)
and  Section   3.1(c).   The  Company  shall  call  a  special  meeting  of  its
stockholders,  as promptly as  practicable  following  the  Closing,  to vote on
proposals  (collectively,  the  "Stockholder  Proposals")  to  (i)  approve  the
exercise  of the  Warrant  for  Common  Stock for  purposes  of the rules of the
national security exchange on which the Common Stock is listed and/or (ii) amend
the  Company's  Charter to increase  the number of  authorized  shares of Common
Stock to at least such number as shall be sufficient to permit the full exercise
of the Warrant for Common  Stock and comply  with the other  provisions  of this
Section 3.1(b) and Section 3.1(c). The Board of Directors shall recommend to the
Company's  stockholders  that such stockholders vote in favor of the Stockholder
Proposals.  In connection with such meeting,  the Company shall prepare (and the
Investor will  reasonably  cooperate  with the Company to prepare) and file with
the SEC as promptly as practicable  (but in no event more than ten business days
after the Closing) a preliminary proxy statement,  shall use its reasonable best
efforts to respond to any comments of the SEC or its staff  thereon and to cause

                                       13
<PAGE>

a definitive 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 use its reasonable best efforts to solicit proxies
for such stockholder  approval of the Stockholder  Proposals.  The Company shall
notify the Investor  promptly of the receipt of any comments from the SEC or its
staff with respect to the proxy  statement  and of any request by the SEC or its
staff for amendments or  supplements  to such proxy  statement or for additional
information  and will  supply the  Investor  with  copies of all  correspondence
between the Company or any of its representatives,  on the one hand, and the SEC
or its staff, 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 be set forth in an amendment or supplement  to the proxy  statement,
the  Company  shall  as  promptly  as  practicable   prepare  and  mail  to  its
stockholders  such an  amendment  or  supplement.  Each of the  Investor and the
Company  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
amendment 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 with a reasonable  opportunity 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  beginning  on January 1, 2009  until all such  approvals  are
obtained or made.

         (c)     None of the information  supplied by the Company or any of the
Company Subsidiaries for inclusion in any proxy statement in connection with any
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  meeting,  and at the time of any amendment or supplement  thereof,
contain any untrue  statement  of a material  fact or omit to state any material
fact  necessary  in  order  to make  the  statements  therein,  in  light of the
circumstances under which they are made, not misleading.

         3.2     Expenses.  Unless otherwise  provided in this Agreement or the
Warrant,  each of the parties  hereto  will bear and pay all costs and  expenses
incurred by it or on its behalf in connection with the transactions contemplated
under this  Agreement  and the Warrant,  including  fees and expenses of its own
financial or other consultants, investment bankers, accountants and counsel.

         3.3     Sufficiency of Authorized Common Stock; Exchange Listing.

         (a)     During  the period from the Closing  Date (or, if the approval
of the Stockholder  Proposals is required,  the date of such approval) until the
date on which the Warrant  has been fully  exercised,  the Company  shall at all
times have  reserved for  issuance,  free of  preemptive  or similar  rights,  a
sufficient  number of authorized and unissued  Warrant Shares to effectuate such
exercise. Nothing in this Section 3.3 shall preclude the Company from satisfying
its  obligations in respect of the exercise of the Warrant by delivery of shares
of  Common  Stock  which are held in the  treasury  of the  Company.  As soon as
reasonably practicable following the Closing, the Company shall, at its expense,
cause the Warrant Shares to be listed on the same national  securities  exchange
on which the Common Stock is listed, subject to official notice of issuance, and
shall  maintain  such  listing for so long as any Common Stock is listed on such
exchange.

                                       14
<PAGE>

         (b)     If  requested by the Investor,  the Company shall promptly use
its  reasonable  best efforts to cause the  Preferred  Shares to be approved for
listing on a national securities  exchange 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 which it is aware and which would  reasonably be
expected to cause any  representation  or warranty of the Company  contained  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 with or satisfied in any material respect and (ii) except as Previously
Disclosed,  any fact,  circumstance,  event,  change,  occurrence,  condition or
development  of which the  Company  is aware and which,  individually  or in the
aggregate,  has had or would  reasonably be expected to have a Company  Material
Adverse Effect; provided,  however, that delivery of any notice pursuant to this
Section 3.4 shall not limit or affect any rights of or remedies available to the
Investor;  provided,  further,  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 Material
Adverse Effect 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 Confidentiality.

         (a)     From  the Signing Date until the date when the Investor  holds
an amount of Preferred Shares having an aggregate liquidation value of less than
10% of the Purchase Price,  the Company will permit the Investor and its agents,
consultants, contractors and advisors (x) acting through the Appropriate Federal
Banking  Agency,  to examine the corporate  books and make copies thereof and to
discuss  the  affairs,  finances  and  accounts  of the  Company and the Company
Subsidiaries  with the principal  officers of the Company,  all upon  reasonable
notice and at such reasonable  times and as often as the Investor may reasonably
request and (y) to review any information material to the Investor's  investment
in the  Company  provided  by the  Company to its  Appropriate  Federal  Banking
Agency. Any investigation pursuant to this Section 3.5 shall be conducted during
normal business hours and in such manner as not to interfere  unreasonably  with
the conduct of the business of the Company, and nothing herein shall require the
Company or any Company Subsidiary to disclose any information to the Investor to
the extent (i)  prohibited by applicable  law or  regulation,  or (ii) that such
disclosure would reasonably be expected to cause a violation of any agreement to
which the Company or any Company  Subsidiary is a party or would cause a risk of
a loss of privilege to the Company or any Company Subsidiary  (provided that the
Company shall use commercially reasonable efforts to make appropriate substitute
disclosure  arrangements  under  circumstances  where the  restrictions  in this
clause (ii) apply).

         (b)     The  Investor will use  reasonable  best efforts to hold,  and
will use reasonable best efforts to cause its agents,  consultants,  contractors
and advisors to hold, in confidence all non-public  records,  books,  contracts,
instruments,  computer  data  and  other  data  and  information  (collectively,
"Information")  concerning the Company  furnished or made available to it by the
Company or its representatives  pursuant to this Agreement (except to the extent
that such  information  can be shown to have been (i)  previously  known by such
party on a non-confidential basis, (ii) in the public domain through no fault of

                                       15
<PAGE>

such party or (iii) later  lawfully  acquired from other sources by the party to
which it was  furnished  (and  without  violation  of any other  confidentiality
obligation));  provided  that  nothing  herein shall  prevent the Investor  from
disclosing  any  Information  to the  extent  required  by  applicable  laws  or
regulations or by any subpoena or similar legal process.

                                   Article IV

                              Additional Agreements

         4.1     Purchase  for Investment.  The Investor  acknowledges that the
Purchased  Securities and the Warrant Shares have not been registered  under the
Securities Act or under 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  laws,  (b) will not sell or  otherwise  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 knowledge and experience
in financial  and business  matters and in  investments  of this type that it is
capable of  evaluating  the merits  and risks of the  Purchase  and of making an
informed investment decision.

         4.2     Legends.

         (a)      The Investor agrees that all certificates or other instruments
representing the Warrant and the Warrant Shares will bear a legend substantially
to the following effect:

         "THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF
         ANY STATE AND MAY NOT BE  TRANSFERRED,  SOLD OR  OTHERWISE  DISPOSED OF
         EXCEPT WHILE A  REGISTRATION  STATEMENT  RELATING  THERETO IS IN EFFECT
         UNDER SUCH ACT AND APPLICABLE  STATE  SECURITIES LAWS OR PURSUANT TO AN
         EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS."

         (b)     The Investor agrees that all certificates or other instruments
representing the Warrant will also bear a legend  substantially to the following
effect:

         "THIS  INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND
         OTHER PROVISIONS OF A SECURITIES  PURCHASE AGREEMENT BETWEEN THE ISSUER
         OF THESE  SECURITIES  AND THE INVESTOR  REFERRED TO THEREIN,  A COPY OF
         WHICH IS ON FILE WITH THE ISSUER.  THE  SECURITIES  REPRESENTED BY THIS
         INSTRUMENT  MAY  NOT  BE  SOLD  OR  OTHERWISE   TRANSFERRED  EXCEPT  IN
         COMPLIANCE  WITH  SAID  AGREEMENT.  ANY SALE OR OTHER  TRANSFER  NOT IN
         COMPLIANCE WITH SAID AGREEMENT WILL BE VOID."

                                       16
<PAGE>

         (c)     In  addition,  the Investor  agrees that all  certificates  or
other  instruments   representing  the  Preferred  Shares  will  bear  a  legend
substantially to the following effect:

         "THE  SECURITIES   REPRESENTED  BY  THIS  INSTRUMENT  ARE  NOT  SAVINGS
         ACCOUNTS,  DEPOSITS OR OTHER  OBLIGATIONS OF A BANK AND ARE NOT INSURED
         BY THE FEDERAL DEPOSIT INSURANCE  CORPORATION OR ANY OTHER GOVERNMENTAL
         AGENCY.

         THE SECURITIES  REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
         THE SECURITIES  LAWS OF ANY STATE AND MAY NOT BE  TRANSFERRED,  SOLD OR
         OTHERWISE  DISPOSED OF EXCEPT WHILE A REGISTRATION  STATEMENT  RELATING
         THERETO IS IN EFFECT  UNDER SUCH ACT AND  APPLICABLE  STATE  SECURITIES
         LAWS OR PURSUANT TO AN EXEMPTION  FROM  REGISTRATION  UNDER SUCH ACT OR
         SUCH  LAWS.  EACH  PURCHASER  OF THE  SECURITIES  REPRESENTED  BY  THIS
         INSTRUMENT  IS NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION
         FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A  THEREUNDER.
         ANY TRANSFEREE OF THE SECURITIES  REPRESENTED BY THIS INSTRUMENT BY ITS
         ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED  INSTITUTIONAL
         BUYER" (AS DEFINED IN RULE 144A UNDER THE  SECURITIES  ACT), (2) AGREES
         THAT IT WILL NOT  OFFER,  SELL OR  OTHERWISE  TRANSFER  THE  SECURITIES
         REPRESENTED  BY THIS  INSTRUMENT  EXCEPT (A) PURSUANT TO A REGISTRATION
         STATEMENT  WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO
         LONG AS THE SECURITIES  REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR
         RESALE  PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY  BELIEVES IS A
         "QUALIFIED  INSTITUTIONAL  BUYER" AS  DEFINED  IN RULE  144A  UNDER THE
         SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
         A  QUALIFIED  INSTITUTIONAL  BUYER TO WHOM  NOTICE  IS  GIVEN  THAT THE
         TRANSFER IS BEING MADE IN  RELIANCE ON RULE 144A,  (C) TO THE ISSUER OR
         (D) PURSUANT TO ANY OTHER  AVAILABLE  EXEMPTION  FROM THE  REGISTRATION
         REQUIREMENTS  OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO
         EACH PERSON TO WHOM THE SECURITIES  REPRESENTED BY THIS  INSTRUMENT ARE
         TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND."

         (d)     In  the event that any Purchased  Securities or Warrant Shares
(i)  become  registered  under the  Securities  Act or (ii) are  eligible  to be
transferred without restriction in accordance with Rule 144 or another exemption
from  registration  under the Securities Act (other than Rule 144A), the Company
shall issue new certificates or other  instruments  representing  such Purchased
Securities or Warrant Shares,  which shall not contain the applicable legends in
Sections  4.2(a) and (c) above;  provided  that the Investor  surrenders  to the

                                       17
<PAGE>

Company the previously issued  certificates or other instruments.  Upon Transfer
of all or a portion of the Warrant in  compliance  with Section 4.4, the Company
shall issue new  certificates  or other  instruments  representing  the Warrant,
which 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  merge  or
consolidate  with, or sell,  transfer or lease all or  substantially  all of its
property  or assets to, any other  party  unless the  successor,  transferee  or
lessee party (or its  ultimate  parent  entity),  as the case may be (if not the
Company),  expressly assumes the due and punctual  performance and observance of
each and  every  covenant,  agreement  and  condition  of this  Agreement  to be
performed and observed by the Company.

         4.4   Transfer   of  Purchased   Securities  and  Warrant  Shares;
Restrictions  on Exercise of the Warrant.  Subject to compliance with applicable
securities  laws, the Investor shall be permitted to transfer,  sell,  assign or
otherwise  dispose of ("Transfer") all or a portion of the Purchased  Securities
or Warrant  Shares at any time,  and the Company  shall take all steps as may be
reasonably requested by the Investor to facilitate the Transfer of the Purchased
Securities and the Warrant Shares; provided that the Investor shall not Transfer
a portion or portions of the  Warrant  with  respect  to,  and/or  exercise  the
Warrant for,  more than one-half of the Initial  Warrant  Shares (as such number
may be  adjusted  from time to time  pursuant  to  Section  13  thereof)  in the
aggregate  until  the  earlier  of (a) the date on  which  the  Company  (or any
successor by Business  Combination) has received aggregate gross proceeds of not
less than the Purchase Price (and the purchase price paid by the Investor to any
such successor for securities of such  successor  purchased  under the CPP) from
one or more Qualified Equity Offerings  (including Qualified Equity Offerings of
such successor) and (b) December 31, 2009. "Qualified Equity Offering" means the
sale and issuance  for cash by the Company to persons  other than the Company or
any of the Company  Subsidiaries  after the Closing  Date of shares of perpetual
Preferred  Stock,  Common Stock or any combination of such stock,  that, in each
case,  qualify as and may be  included  in Tier 1 capital of the  Company at the
time of issuance  under the  applicable  risk-based  capital  guidelines  of the
Company's  Appropriate  Federal  Banking  Agency  (other than any such sales and
issuances made pursuant to agreements or arrangements  entered into, or pursuant
to financing  plans which were  publicly  announced,  on or prior to October 13,
2008).  "Business  Combination" means a merger,  consolidation,  statutory share
exchange or similar  transaction  that  requires the  approval of the  Company's
stockholders.

         4.5     Registration Rights.

         (a)     Registration.

                  (i) Subject to the terms and conditions of this Agreement, the
         Company  covenants and agrees that as promptly as practicable after the
         Closing  Date (and in any event no later than 30 days after the Closing
         Date),  the  Company  shall  prepare  and  file  with  the  SEC a Shelf
         Registration   Statement   covering  all  Registrable   Securities  (or
         otherwise designate an existing Shelf Registration Statement filed with
         the SEC to cover the  Registrable  Securities),  and, to the extent the
         Shelf   Registration   Statement  has  not  theretofore  been  declared

                                       18
<PAGE>

         effective  or is not  automatically  effective  upon such  filing,  the
         Company  shall  use  reasonable   best  efforts  to  cause  such  Shelf
         Registration  Statement to be declared or become  effective and to keep
         such  Shelf  Registration   Statement  continuously  effective  and  in
         compliance  with the  Securities  Act and  usable  for  resale  of such
         Registrable  Securities  for a  period  from  the  date of its  initial
         effectiveness  until such time as there are no  Registrable  Securities
         remaining (including by refiling such Shelf Registration  Statement (or
         a new Shelf  Registration  Statement) 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
         filing of the Shelf  Registration  Statement  with the SEC,  such Shelf
         Registration  Statement  shall  be  designated  by  the  Company  as an
         automatic Shelf Registration Statement.  Notwithstanding the foregoing,
         if on  the  Signing  Date  the  Company  is  not  eligible  to  file  a
         registration  statement  on Form  S-3,  then the  Company  shall not be
         obligated  to file a Shelf  Registration  Statement  unless  and  until
         requested to do so in writing by the Investor.

                  (ii) Any registration  pursuant to Section  4.5(a)(i) shall be
         effected by means of a shelf  registration on an appropriate form under
         Rule 415 under the Securities Act (a "Shelf  Registration  Statement").
         If  the  Investor  or  any  other  Holder  intends  to  distribute  any
         Registrable  Securities by means of an  underwritten  offering it shall
         promptly  so  advise  the  Company  and  the  Company  shall  take  all
         reasonable steps to facilitate such distribution, including the actions
         required  pursuant to Section  4.5(c);  provided that the Company shall
         not be required to facilitate an  underwritten  offering of Registrable
         Securities unless the expected gross proceeds from such offering exceed
         (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.  The  lead  underwriters  in any  such  distribution  shall be
         selected by the Holders of a majority of the Registrable  Securities to
         be distributed;  provided that to the extent  appropriate and permitted
         under applicable law, such Holders shall consider the qualifications of
         any  broker-dealer  Affiliate  of the  Company  in  selecting  the lead
         underwriters in any such distribution.

                  (iii)  The   Company   shall  not  be  required  to  effect  a
         registration  (including  a resale of  Registrable  Securities  from an
         effective Shelf  Registration  Statement) or an  underwritten  offering
         pursuant to Section 4.5(a): (A) with respect to securities that are not
         Registrable Securities; or (B) if the Company has notified the Investor
         and all other  Holders that in the good faith  judgment of the Board of
         Directors,  it would be  materially  detrimental  to the Company or its
         securityholders  for such  registration or underwritten  offering to be
         effected at such time,  in which event the Company shall have the right
         to defer such  registration for a period of not more than 45 days after
         receipt of the request of the  Investor or any other  Holder;  provided
         that such right to delay a registration or underwritten  offering shall
         be  exercised  by the Company  (1) only if the  Company  has  generally
         exercised (or is  concurrently  exercising)  similar  black-out  rights
         against holders of similar securities that have registration rights and
         (2) not more than three times in any 12-month  period and not more than
         90 days in the aggregate in any 12-month period.

                                       19
<PAGE>

                  (iv) 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  form to be
         filed  may  be  used  for  the   registration  or   qualification   for
         distribution  of Registrable  Securities,  the Company will give prompt
         written  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  within ten business
         days   after  the  date  of  the   Company's   notice   (a   "Piggyback
         Registration").  Any such person  that has made such a written  request
         may   withdraw  its   Registrable   Securities   from  such   Piggyback
         Registration  by giving  written notice to the Company and the managing
         underwriter,  if any, on or before the fifth  business day prior to the
         planned effective date of such Piggyback Registration.  The Company may
         terminate or withdraw any  registration  under this Section  4.5(a)(iv)
         prior  to  the  effectiveness  of  such  registration,  whether  or not
         Investor  or any other  Holders  have  elected to  include  Registrable
         Securities in such registration.

                  (v) If the registration  referred to in Section  4.5(a)(iv) is
         proposed to be  underwritten,  the Company will so advise  Investor and
         all other  Holders as a part of the written  notice  given  pursuant to
         Section 4.5(a)(iv).  In such event, the right of Investor and all other
         Holders to registration  pursuant to Section 4.5(a) will be conditioned
         upon such persons' participation in such underwriting and the inclusion
         of such person's  Registrable  Securities in the  underwriting  if such
         securities  are of the same class of securities as the securities to be
         offered  in the  underwritten  offering,  and  each  such  person  will
         (together  with the Company and the other  persons  distributing  their
         securities  through  such  underwriting)  enter  into  an  underwriting
         agreement  in  customary  form  with the  underwriter  or  underwriters
         selected  for  such  underwriting  by the  Company;  provided  that the
         Investor  (as  opposed  to other  Holders)  shall  not be  required  to
         indemnify  any  person  in  connection  with any  registration.  If any
         participating person disapproves of the terms of the underwriting, such
         person  may  elect to  withdraw  therefrom  by  written  notice  to the
         Company, the managing underwriters and the Investor (if the Investor is
         participating in the underwriting).

                  (vi) If either (x) the Company grants "piggyback" registration
         rights to one or more third parties to include  their  securities in an
         underwritten  offering under the Shelf Registration  Statement pursuant
         to Section  4.5(a)(ii)  or (y) a Piggyback  Registration  under Section
         4.5(a)(iv)  relates  to an  underwritten  offering  on  behalf  of  the
         Company,  and in  either  case the  managing  underwriters  advise  the
         Company  that in their  reasonable  opinion  the  number of  securities
         requested to be included in such offering  exceeds the number which can
         be sold without adversely  affecting the marketability of such offering
         (including  an adverse  effect on the per share  offering  price),  the
         Company will include in such  offering  only such number of  securities
         that in the  reasonable  opinion of such managing  underwriters  can be
         sold without  adversely  affecting  the  marketability  of the offering
         (including an adverse  effect on the per share offering  price),  which
         securities will be so included in the following order of priority:  (A)
         first,  in  the  case  of  a  Piggyback   Registration   under  Section
         4.5(a)(iv),  the securities the Company  proposes to sell, (B) then the
         Registrable  Securities  of the Investor and all other Holders who have
         requested  inclusion  of  Registrable  Securities  pursuant  to Section
         4.5(a)(ii) or Section 4.5(a)(iv), as applicable,  pro rata on the basis
         of the aggregate number of such securities or shares owned by each such
         person and (C) lastly,  any other  securities  of the Company that have

                                       20
<PAGE>

         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 conflicting agreement
         to the extent  that it would  otherwise  result in a breach  under such
         agreement.

         (b)      Expenses of Registration.  All Registration  Expenses incurred
in connection with any registration, qualification or compliance hereunder shall
be borne by the Company.  All Selling  Expenses  incurred in connection with any
registrations  hereunder  shall be borne by the  holders  of the  securities  so
registered pro rata on the basis of the aggregate  offering or sale price of the
securities so registered.

         (c)       Obligations  of  the  Company.  The  Company  shall  use  its
reasonable  best  efforts,  for so  long as  there  are  Registrable  Securities
outstanding,  to take such  actions  as are under its  control  to not become an
ineligible  issuer  (as  defined  in Rule 405 under the  Securities  Act) and to
remain a well-known seasoned issuer (as defined in Rule 405 under the Securities
Act) if it has such  status on the  Signing  Date or becomes  eligible  for such
status in the future. In addition,  whenever required to effect the registration
of any  Registrable  Securities or facilitate  the  distribution  of Registrable
Securities  pursuant to an effective Shelf Registration  Statement,  the Company
shall, as expeditiously as reasonably practicable:

                  (i) Prepare and file with the SEC a prospectus supplement with
         respect to a proposed offering of Registrable Securities pursuant to an
         effective registration statement,  subject to Section 4.5(d), keep such
         registration  statement  effective and keep such prospectus  supplement
         current  until  the   securities   described   therein  are  no  longer
         Registrable Securities.

                  (ii)  Prepare  and  file  with  the SEC  such  amendments  and
         supplements to the applicable registration statement and the prospectus
         or  prospectus  supplement  used in connection  with such  registration
         statement  as may be  necessary  to comply with the  provisions  of the
         Securities  Act  with  respect  to the  disposition  of all  securities
         covered by such registration statement.

                  (iii) Furnish to the Holders and any underwriters  such number
         of  copies  of the  applicable  registration  statement  and each  such
         amendment and supplement  thereto (including in each case all exhibits)
         and of a prospectus,  including a preliminary prospectus, in conformity
         with the  requirements  of the Securities Act, and such other documents
         as they may reasonably  request in order to facilitate the  disposition
         of Registrable Securities owned or to be distributed by them.

                                       21
<PAGE>

                  (iv) Use its  reasonable  best efforts to register and qualify
         the securities covered by such registration  statement under such other
         securities  or  Blue  Sky  laws  of  such  jurisdictions  as  shall  be
         reasonably requested by the Holders or any managing underwriter(s),  to
         keep such  registration or  qualification in effect for so long as such
         registration  statement remains in effect, and to take any other action
         which may be  reasonably  necessary to enable such seller to consummate
         the disposition in such  jurisdictions  of the securities owned by such
         Holder;  provided  that the Company shall not be required in connection
         therewith  or as a  condition  thereto to qualify to do  business or to
         file a general  consent to  service  of  process in any such  states or
         jurisdictions.

                  (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 which
         the  applicable  prospectus,  as then in  effect,  includes  an  untrue
         statement of a material fact or omits to state a material fact required
         to be stated  therein or necessary to make the  statements  therein not
         misleading in light of the circumstances then existing.

                  (vi) Give written notice to the Holders:

                           (A) when any registration statement filed pursuant to
                  Section  4.5(a) or any  amendment  thereto has been filed with
                  the SEC (except for any amendment  effected by the filing of a
                  document  with the SEC pursuant to the Exchange  Act) and when
                  such registration  statement or any  post-effective  amendment
                  thereto has become effective;

                           (B) of any  request  by the  SEC  for  amendments  or
                  supplements  to any  registration  statement or the prospectus
                  included therein or for additional information;

                           (C) of the  issuance  by the  SEC of any  stop  order
                  suspending the effectiveness of any registration  statement or
                  the initiation of any proceedings for that purpose;

                           (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 any event that  requires the
                  Company  to  make  changes  in  any   effective   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 have been made); and

                           (F) if at any time the representations and warranties
                  of  the  Company  contained  in  any  underwriting   agreement
                  contemplated  by  Section  4.5(c)(x)  cease  to  be  true  and
                  correct.

                                       22
<PAGE>

                  (vii) Use its reasonable  best efforts to prevent the issuance
         or obtain the withdrawal of any order  suspending the  effectiveness of
         any registration  statement referred to in Section 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 post-effective
         amendment to such registration statement or a supplement to the related
         prospectus or file any other  required  document so that, as thereafter
         delivered to the Holders and any underwriters,  the prospectus will not
         contain an untrue  statement  of a  material  fact or omit to state any
         material fact necessary to make the statements therein, in light of the
         circumstances  under  which  they were  made,  not  misleading.  If the
         Company  notifies the Holders in accordance with Section  4.5(c)(vi)(E)
         to suspend the use of the prospectus until the requisite changes to the
         prospectus have been made, then the Holders and any underwriters  shall
         suspend use of such prospectus and use their reasonable best efforts to
         return to the Company all copies of such  prospectus  (at the Company's
         expense)  other than  permanent  file copies  then in such  Holders' or
         underwriters'  possession.  The  total  number  of days  that  any such
         suspension may be in effect in any 12-month  period shall not exceed 90
         days.

                  (ix) Use reasonable best efforts to procure the cooperation of
         the  Company's  transfer  agent in  settling  any  offering  or sale of
         Registrable  Securities,  including  with  respect to the  transfer  of
         physical stock certificates into book-entry form in accordance with any
         procedures   reasonably  requested  by  the  Holders  or  any  managing
         underwriter(s).

                  (x) If an  underwritten  offering  is  requested  pursuant  to
         Section 4.5(a)(ii),  enter into an underwriting  agreement in customary
         form,  scope and substance  and take all such other actions  reasonably
         requested  by the Holders of a majority of the  Registrable  Securities
         being sold in connection  therewith or by the managing  underwriter(s),
         if any, to expedite or facilitate the underwritten  disposition of such
         Registrable Securities, and in connection therewith in any underwritten
         offering  (including making members of management and executives of the
         Company available to participate in "road shows",  similar sales events
         and other  marketing  activities),  (A) make such  representations  and
         warranties  to the  Holders  that  are  selling  stockholders  and  the
         managing  underwriter(s),  if any,  with respect to the business of the
         Company and its  subsidiaries,  and the Shelf  Registration  Statement,
         prospectus  and  documents,  if  any,  incorporated  or  deemed  to  be
         incorporated  by reference  therein,  in each case, in customary  form,
         substance  and  scope,  and,  if  true,  confirm  the  same if and when
         requested,   (B)  use  its  reasonable  best  efforts  to  furnish  the
         underwriters with opinions of counsel to the Company,  addressed to the
         managing  underwriter(s),  if any,  covering  the  matters  customarily
         covered in such opinions requested in underwritten  offerings,  (C) use
         its reasonable  best efforts to obtain "cold comfort"  letters from the
         independent  certified  public  accountants  of the  Company  (and,  if
         necessary,  any other independent  certified public  accountants of any
         business  acquired by the Company for which  financial  statements  and
         financial  data are included in the Shelf  Registration  Statement) who
         have  certified  the  financial   statements  included  in  such  Shelf
         Registration   Statement,   addressed   to   each   of   the   managing
         underwriter(s),  if any,  such  letters  to be in  customary  form  and
         covering  matters of the type  customarily  covered  in "cold  comfort"

                                       23
<PAGE>

         letters,  (D) if an  underwriting  agreement is entered into,  the same
         shall contain  indemnification  provisions and procedures  customary in
         underwritten  offerings  (provided  that  the  Investor  shall  not  be
         obligated to provide any indemnity), and (E) deliver such documents and
         certificates  as may  be  reasonably  requested  by  the  Holders  of a
         majority  of  the  Registrable  Securities  being  sold  in  connection
         therewith,  their counsel and the managing  underwriter(s),  if any, to
         evidence the continued validity of the  representations  and warranties
         made pursuant to clause (i) above and to evidence  compliance  with any
         customary conditions  contained in the underwriting  agreement or other
         agreement entered into by the Company.

                  (xi) Make  available  for  inspection by a  representative  of
         Holders that are selling stockholders, the managing underwriter(s),  if
         any,  and any  attorneys  or  accountants  retained by such  Holders or
         managing  underwriter(s),  at the offices where normally  kept,  during
         reasonable  business  hours,  financial  and other  records,  pertinent
         corporate  documents  and  properties  of the  Company,  and  cause the
         officers,  directors  and  employees  of  the  Company  to  supply  all
         information  in  each  case  reasonably  requested  (and  of  the  type
         customarily  provided in  connection  with due  diligence  conducted in
         connection with a registered public offering of securities) by any such
         representative,  managing  underwriter(s),  attorney or  accountant  in
         connection with such Shelf Registration Statement.

                  (xii)  Use   reasonable   best   efforts  to  cause  all  such
         Registrable  Securities  to  be  listed  on  each  national  securities
         exchange  on which  similar  securities  issued by the Company are then
         listed  or, if no similar  securities  issued by the  Company  are then
         listed on any national  securities  exchange,  use its reasonable  best
         efforts to cause all such  Registrable  Securities to be listed on such
         securities exchange as the Investor may designate.

                  (xiii)  If   requested   by  Holders  of  a  majority  of  the
         Registrable  Securities  being  registered  and/or  sold in  connection
         therewith, or the managing underwriter(s),  if any, promptly include in
         a prospectus supplement or amendment such information as the Holders of
         a majority of the Registrable  Securities being registered  and/or sold
         in  connection  therewith  or  managing  underwriter(s),  if  any,  may
         reasonably   request  in  order  to  permit  the  intended   method  of
         distribution of such  securities and make all required  filings of such
         prospectus  supplement or such amendment as soon as  practicable  after
         the Company has received such request.

                  (xiv)  Timely   provide  to  its  security   holders   earning
         statements satisfying the provisions of Section 11(a) of the Securities
         Act and Rule 158 thereunder.

         (d)       Suspension  of Sales. Upon receipt of written notice from the
Company that a  registration  statement,  prospectus  or  prospectus  supplement
contains or may contain an untrue  statement of a material  fact or omits or may
omit to state a material fact required to be stated therein or necessary to make
the  statements  therein not  misleading or that  circumstances  exist that make

                                       24
<PAGE>

inadvisable  use  of  such  registration  statement,  prospectus  or  prospectus
supplement,  the  Investor  and each  Holder  of  Registrable  Securities  shall
forthwith discontinue  disposition of Registrable  Securities until the Investor
and/or Holder has received  copies of a  supplemented  or amended  prospectus or
prospectus  supplement,  or until the Investor  and/or such Holder is advised in
writing  by the  Company  that the use of the  prospectus  and,  if  applicable,
prospectus  supplement may be resumed,  and, if so directed by the Company,  the
Investor  and/or such  Holder  shall  deliver to the  Company (at the  Company's
expense)  all copies,  other than  permanent  file  copies then in the  Investor
and/or  such  Holder's  possession,   of  the  prospectus  and,  if  applicable,
prospectus  supplement covering such Registrable  Securities current at the time
of receipt of such notice. The total number of days that any such suspension may
be in effect in any 12-month period shall not exceed 90 days.

         (e)       Termination of Registration  Rights. A Holder's  registration
rights as to any securities held by such Holder (and its  Affiliates,  partners,
members and former  members) shall not be available  unless such  securities are
Registrable Securities.

         (f)     Furnishing Information.

                  (i) Neither  the  Investor  nor any Holder  shall use any free
         writing prospectus (as defined in Rule 405) in connection with the sale
         of  Registrable  Securities  without the prior  written  consent of the
         Company.

                  (ii) It  shall be It shall  be a  condition  precedent  to the
         obligations  of the  Company  to take any  action  pursuant  to Section
         4.5(c) that Investor and/or the selling  Holders and the  underwriters,
         if  any,  shall  furnish  to the  Company  such  information  regarding
         themselves,  the  Registrable  Securities held by them and the intended
         method of disposition of such securities as shall be required to effect
         the registered offering of their Registrable Securities.

         (g)  Indemnification.

                  (i) The  Company  agrees to  indemnify  each  Holder and, if a
         Holder is a person other than an  individual,  such Holder's  officers,
         directors,  employees, agents, representatives and Affiliates, and each
         Person,  if any,  that  controls  a Holder  within  the  meaning of the
         Securities  Act (each,  an  "Indemnitee"),  against any and all losses,
         claims, damages,  actions,  liabilities,  costs and expenses (including
         reasonable  fees,  expenses and  disbursements  of attorneys  and other
         professionals  incurred in connection  with  investigating,  defending,
         settling,  compromising  or paying any such  losses,  claims,  damages,
         actions,  liabilities,  costs and expenses),  joint or several, arising
         out of or based upon any untrue  statement or alleged untrue  statement
         of material fact contained in any registration statement, including any
         preliminary  prospectus or final  prospectus  contained  therein or any
         amendments or supplements thereto or any documents incorporated therein
         by reference or contained in any free writing  prospectus (as such term
         is defined in Rule 405)  prepared by the Company or authorized by it in
         writing  for  use by  such  Holder  (or  any  amendment  or  supplement
         thereto);  or any omission to state therein a material fact required to
         be stated therein or necessary to make the statements therein, in light

                                       25
<PAGE>

         of the  circumstances  under  which  they were  made,  not  misleading;
         provided,  that the Company  shall not be liable to such  Indemnitee in
         any  such  case to the  extent  that  any  such  loss,  claim,  damage,
         liability  (or  action or  proceeding  in respect  thereof)  or expense
         arises out of or is based upon (A) an untrue statement or omission made
         in  such  registration   statement,   including  any  such  preliminary
         prospectus or final prospectus contained therein or any such amendments
         or supplements  thereto or contained in any free writing prospectus (as
         such term is 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  Indemnitee  or its plan of  distribution  or ownership  interests
         which was  furnished in writing to the Company by such  Indemnitee  for
         use in connection with such registration statement,  including any such
         preliminary  prospectus or final  prospectus  contained  therein or any
         such amendments or supplements thereto, or (B) offers or sales effected
         by or on behalf of such  Indemnitee  "by means of" (as  defined in Rule
         159A) a "free writing prospectus" (as defined in Rule 405) that was not
         authorized in writing by the Company.

                  (ii) If the indemnification  provided for in Section 4.5(g)(i)
         is  unavailable  to an Indemnitee  with respect to any losses,  claims,
         damages, actions, liabilities, costs or expenses referred to therein or
         is  insufficient  to  hold  the  Indemnitee  harmless  as  contemplated
         therein,  then the Company,  in lieu of indemnifying  such  Indemnitee,
         shall  contribute to the amount paid or payable by such Indemnitee as a
         result of such losses, claims, damages, actions, liabilities,  costs or
         expenses in such  proportion as is  appropriate to reflect the relative
         fault of the Indemnitee, on the one hand, and the Company, on the other
         hand, in connection  with the statements or omissions which resulted in
         such losses, claims, damages, actions,  liabilities,  costs or expenses
         as well as any other relevant  equitable  considerations.  The relative
         fault of the Company,  on the one hand, and of the  Indemnitee,  on the
         other hand,  shall be determined by reference to, among other  factors,
         whether the untrue  statement of a material fact or omission to state a
         material fact relates to information  supplied by the Company or by the
         Indemnitee  and the  parties'  relative  intent,  knowledge,  access to
         information  and  opportunity  to correct or prevent such  statement or
         omission;  the Company and each Holder  agree that it would not be just
         and equitable if contribution  pursuant to this Section 4.5(g)(ii) were
         determined by pro rata  allocation or by any other method of allocation
         that does not take account of the equitable  considerations referred to
         in   Section   4.5(g)(i).    No   Indemnitee   guilty   of   fraudulent
         misrepresentation   (within  the  meaning  of  Section   11(f)  of  the
         Securities Act) shall be entitled to  contribution  from the Company if
         the Company was not guilty of such fraudulent misrepresentation.

         (h)     Assignment  of Registration Rights. The rights of the Investor
to  registration  of  Registrable  Securities  pursuant to Section 4.5(a) may be
assigned by the Investor to a transferee or assignee of  Registrable  Securities
with a liquidation  preference or, in the case of Registrable  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

                                       26
<PAGE>

million if the initial aggregate liquidation  preference of the Preferred Shares
is equal to or greater than $2 billion; provided, however, the transferor shall,
within ten days after such  transfer,  furnish to the Company  written notice of
the name and 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 shall be the last reported sale
price of the  Common  Stock on the  national  securities  exchange  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 Warrant (or any portion
thereof)  shall be the  market  value per share of Common  Stock  into which the
Warrant (or such portion) is exercisable less the exercise price per share.

         (i)      Clear  Market.  With respect to any  underwritten  offering of
Registrable Securities by the Investor or other Holders pursuant to this Section
4.5, the Company agrees not to effect (other than pursuant to such  registration
or pursuant to a Special  Registration)  any public sale or distribution,  or to
file any Shelf Registration Statement (other than such registration or a Special
Registration)  covering, in the case of an underwritten offering of Common Stock
or Warrants,  any of its equity  securities  or, in the case of an  underwritten
offering of Preferred  Shares,  any Preferred Stock of the Company,  or, in each
case, any securities  convertible  into or  exchangeable or exercisable for such
securities, during the period not to exceed ten days prior and 60 days following
the  effective  date of such offering or such longer period up to 90 days as may
be requested by the managing  underwriter for such  underwritten  offering.  The
Company also agrees to cause such of its directors and senior executive officers
to execute and deliver  customary  lock-up  agreements in such form and for such
time  period  up to 90 days as may be  requested  by the  managing  underwriter.
"Special  Registration"  means the registration of (A) equity  securities and/or
options or other rights in respect thereof solely registered on Form S-4 or Form
S-8 (or successor  form) or (B) shares of equity  securities  and/or  options or
other  rights  in  respect  thereof  to be  offered  to  directors,  members  of
management, employees, consultants, customers, lenders or vendors of the Company
or Company Subsidiaries or in connection with dividend reinvestment plans.

         (j)      Rule  144; Rule 144A.  With a view to making  available to the
Investor and Holders the benefits of certain  rules and  regulations  of the SEC
which may permit the sale of the  Registrable  Securities to the public  without
registration, the Company agrees to use its reasonable best efforts to:

                  (i) make and keep public information available, as those terms
         are  understood  and  defined  in  Rule  144(c)(1)  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  manner,  all reports
         and other documents required of the Company under the Exchange Act, and
         (B) if at any time the Company is not  required  to file such  reports,
         make  available,  upon the  request  of any  Holder,  such  information
         necessary  to  permit  sales  pursuant  to  Rule  144A  (including  the
         information required by Rule 144A(d)(4) under the Securities Act);

                  (iii) so long as the Investor or a Holder owns any Registrable
         Securities,  furnish to the  Investor  or such  Holder  forthwith  upon
         request:  a written  statement by the Company as to its compliance with
         the reporting requirements of Rule 144 under the Securities Act, and of

                                       27
<PAGE>

         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 allowing 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  following  terms shall have
the following respective meanings:

                  (i)  "Holder"  means  the  Investor  and any  other  holder of
         Registrable  Securities to whom the  registration  rights  conferred by
         this Agreement have been  transferred in compliance with Section 4.5(h)
         hereof.

                  (ii)  "Holders'  Counsel"  means one  counsel  for the selling
         Holders  chosen  by  Holders   holding  a  majority   interest  in  the
         Registrable Securities being registered.

                  (iii) "Register," "registered," and "registration" shall refer
         to a  registration  effected by preparing and (A) filing a registration
         statement in compliance  with the Securities  Act and applicable  rules
         and  regulations  thereunder,   and  the  declaration  or  ordering  of
         effectiveness of such registration statement or (B) filing a prospectus
         and/or  prospectus  supplement in respect of an  appropriate  effective
         registration statement on Form S-3.

                  (iv) "Registrable  Securities" means (A) all Preferred Shares,
         (B) the  Warrant  (subject  to  Section  4.5(p))  and  (C)  any  equity
         securities  issued or issuable  directly or indirectly  with respect to
         the securities  referred to in the foregoing  clauses (A) or (B) by way
         of  conversion,  exercise or exchange  thereof,  including  the Warrant
         Shares,  or share  dividend  or share  split  or in  connection  with a
         combination  of  shares,  recapitalization,  reclassification,  merger,
         amalgamation,   arrangement,  consolidation  or  other  reorganization,
         provided that,  once issued,  such  securities  will not be Registrable
         Securities when (1) they are sold pursuant to an effective registration
         statement  under the  Securities  Act, (2) except as provided  below in
         Section  4.5(o),  they  may  be  sold  pursuant  to  Rule  144  without
         limitation  thereunder on volume or manner of sale, (3) they shall have
         ceased  to be  outstanding  or (4) they  have  been  sold in a  private
         transaction in which the  transferor's  rights under this Agreement are
         not  assigned  to the  transferee  of the  securities.  No  Registrable
         Securities may be registered under more than one registration statement
         at any one time.

                  (v) "Registration  Expenses" mean all expenses incurred by the
         Company  in  effecting  any  registration  pursuant  to this  Agreement
         (whether or not any  registration  or prospectus  becomes  effective or
         final) or otherwise  complying with its obligations  under this Section
         4.5,  including all  registration,  filing and listing  fees,  printing
         expenses,  fees and disbursements of counsel for the Company,  blue sky

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<PAGE>

         fees and  expenses,  expenses  incurred  in  connection  with any "road
         show", the reasonable fees and disbursements of Holders'  Counsel,  and
         expenses of the Company's  independent  accountants in connection  with
         any regular or special reviews or audits incident to or required by any
         such registration, but shall not include Selling Expenses.

                  (vi) "Rule 144",  "Rule  144A",  "Rule  159A",  "Rule 405" and
         "Rule  415"  mean,  in each  case,  such  rule  promulgated  under  the
         Securities  Act (or any  successor  provision),  as the  same  shall be
         amended from time to time.

                  (vii)  "Selling   Expenses"   mean  all   discounts,   selling
         commissions  and  stock  transfer  taxes  applicable  to  the  sale  of
         Registrable  Securities and fees and  disbursements  of counsel for any
         Holder  (other  than the fees and  disbursements  of  Holders'  Counsel
         included in Registration Expenses).

         (l)     At any time,  any holder of Securities  (including any Holder)
may elect to forfeit  its rights  set forth in this  Section  4.5 from that date
forward;  provided,  that a Holder  forfeiting such rights shall  nonetheless be
entitled  to  participate  under  Section  4.5(a)(iv)  -  (vi)  in  any  Pending
Underwritten  Offering  to the same  extent  that such  Holder  would  have been
entitled to if the holder had not withdrawn; and provided, further, that no such
forfeiture shall terminate a Holder's rights or obligations under Section 4.5(f)
with  respect  to any  prior  registration  or  Pending  Underwritten  Offering.
"Pending Underwritten Offering" means, with respect to any Holder forfeiting its
rights pursuant to this Section 4.5(l), any underwritten offering of Registrable
Securities  in which  such  Holder  has  advised  the  Company  of its intent to
register its Registrable  Securities  either  pursuant to Section  4.5(a)(ii) or
4.5(a)(iv) prior to the date of such Holder's forfeiture.

         (m)      Specific  Performance.  The parties hereto  acknowledge  that
there would be no adequate  remedy at law if the Company fails to perform any of
its  obligations  under this  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 any other remedy to
which they may be entitled at law or in equity,  to the fullest extent permitted
and  enforceable  under  applicable  law shall be  entitled  to compel  specific
performance  of the  obligations  of  the  Company  under  this  Section  4.5 in
accordance with the terms and conditions of this Section 4.5.

         (n)     No Inconsistent Agreements. The Company shall not, on or after
the Signing Date,  enter into any agreement with respect to its securities  that
may impair the rights granted to the Investor and the Holders under this Section
4.5 or that otherwise  conflicts  with the provisions  hereof in any manner that
may impair the rights granted to the Investor and the Holders under this Section
4.5. In the event the Company has,  prior to the Signing Date,  entered into any
agreement with respect to its securities  that is  inconsistent  with the rights
granted to the  Investor  and the  Holders  under this  Section  4.5  (including
agreements  that are  inconsistent  with the order of priority  contemplated  by
Section  4.5(a)(vi)) or that may otherwise  conflict with the provisions hereof,
the Company shall use its  reasonable  best efforts to amend such  agreements to
ensure they are consistent with the provisions of this Section 4.5.

         (o)      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

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<PAGE>

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 be Registrable  Securities.  In any such case, an
"underwritten"  offering or other  disposition shall include any distribution of
such  securities  on behalf of the  Investor by one or more  broker-dealers,  an
"underwriting  agreement" shall include any purchase  agreement  entered into by
such  broker-dealers,  and any  "registration  statement" or "prospectus"  shall
include any  offering  document  approved by the Company and used in  connection
with such distribution.

         (p)     Registered Sales of the Warrant. The Holders agree to sell the
Warrant or any  portion  thereof  under the Shelf  Registration  Statement  only
beginning  30 days after  notifying  the Company of any such sale,  during which
30-day period the Investor and all Holders of the Warrant shall take  reasonable
steps to agree to  revisions to the Warrant to permit a public  distribution  of
the  Warrant,  including  entering  into a warrant  agreement  and  appointing a
warrant agent.

         4.6      Voting of Warrant  Shares.  Notwithstanding  anything in this
Agreement to the  contrary,  the Investor  shall not exercise any voting  rights
with respect to the Warrant Shares.

         4.7      Depositary  Shares.  Upon request by the Investor at any time
following the Closing Date,  the Company shall  promptly enter into a depositary
arrangement,  pursuant to customary  agreements  reasonably  satisfactory to the
Investor and with a depositary reasonably  acceptable to the Investor,  pursuant
to which the  Preferred  Shares may be deposited  and  depositary  shares,  each
representing a fraction of a Preferred  Share as specified by the Investor,  may
be issued. From and after the execution of any such depositary arrangement,  and
the deposit of any Preferred  Shares  pursuant  thereto,  the depositary  shares
issued pursuant thereto shall be deemed  "Preferred  Shares" and, as applicable,
"Registrable Securities" for purposes of this Agreement.

         4.8     Restriction on Dividends and Repurchases.

         (a)      Prior  to the  earlier  of (x) the third  anniversary  of the
Closing Date and (y) the date on which the  Preferred  Shares have been redeemed
in whole or the Investor has  transferred  all of the Preferred  Shares to third
parties which are not  Affiliates  of the Investor,  neither the Company nor any
Company Subsidiary shall, without the consent of the Investor:

                  (i) declare or pay any  dividend or make any  distribution  on
         the Common Stock (other 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 announced an intention to declare,  on
         the Common Stock prior to October 14,  2008,  as adjusted for any stock
         split, stock dividend, reverse stock split, reclassification or similar
         transaction, (B) dividends payable solely in shares of Common Stock and
         (C) dividends or  distributions of rights or Junior Stock in connection
         with a stockholders' rights plan); or

                  (ii) redeem, purchase or acquire any shares of Common Stock or
         other  capital  stock or  other  equity  securities  of any kind of the

                                       30
<PAGE>

         Company, or any trust preferred securities issued by the Company or any
         Affiliate  of the  Company,  other than (A)  redemptions,  purchases or
         other acquisitions of the 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 defined
         below) pursuant to a publicly announced repurchase plan) and consistent
         with past  practice;  provided  that any  purchases to offset the Share
         Dilution Amount shall in no event exceed the Share Dilution Amount, (C)
         purchases or other  acquisitions by a  broker-dealer  subsidiary of the
         Company  solely for the  purpose  of  market-making,  stabilization  or
         customer  facilitation  transactions in Junior Stock or Parity Stock in
         the ordinary  course of its business,  (D) purchases by a broker-dealer
         subsidiary  of the  Company of capital  stock of the Company for resale
         pursuant  to  an  offering  by  the  Company  of  such  capital   stock
         underwritten by such  broker-dealer  subsidiary,  (E) any redemption or
         repurchase of rights pursuant to any stockholders' rights plan, (F) the
         acquisition by the Company or any of the Company Subsidiaries of record
         ownership in Junior Stock or Parity Stock for the beneficial  ownership
         of any other  persons  (other  than the  Company  or any other  Company
         Subsidiary),  including as trustees or custodians, and (G) the exchange
         or  conversion  of Junior  Stock for or into other  Junior  Stock or of
         Parity  Stock or trust  preferred  securities  for or into other Parity
         (with the same or lesser aggregate liquidation amount) or Junior Stock,
         in each  case set  forth  in this  clause  (G),  solely  to the  extent
         required pursuant to binding contractual  agreements entered into prior
         to the Signing Date or any  subsequent  agreement  for the  accelerated
         exercise,  settlement or exchange thereof for Common Stock (clauses (C)
         and (F), collectively,  the "Permitted  Repurchases").  "Share Dilution
         Amount" means the increase in the number of diluted shares  outstanding
         (determined  in accordance  with GAAP, and as measured from the date of
         the Company's most recently filed Company Financial Statements prior to
         the  Closing  Date)  resulting  from the grant,  vesting or exercise of
         equity-based  compensation to employees and equitably  adjusted for any
         stock split, stock dividend,  reverse stock split,  reclassification or
         similar transaction.

         (b)      Until  such time as the Investor  ceases to own any Preferred
Shares,  the Company shall not repurchase  any Preferred  Shares from any holder
thereof,  whether by means of open market purchase,  negotiated transaction,  or
otherwise,  other than Permitted  Repurchases,  unless it offers to repurchase a
ratable  portion of the  Preferred  Shares then held by the Investor on the same
terms and conditions.

         (c)      "Junior  Stock"  means  Common  Stock and any other  class or
series of stock of the  Company  the terms of which  expressly  provide  that it
ranks junior to the Preferred  Shares as to dividend  rights and/or as to rights
on liquidation,  dissolution or winding up of the Company.  "Parity Stock" means
any class or series of stock of the Company the terms of which do not  expressly
provide  that such class or series will rank  senior or junior to the  Preferred
Shares as to dividend rights and/or as to rights on liquidation,  dissolution or
winding up of the  Company  (in each case  without  regard to whether  dividends
accrue cumulatively or non-cumulatively).

                                       31
<PAGE>

         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  with the Investor,  the Company may
repurchase,  in whole or in part, at any time any other equity securities of the
Company  purchased by the Investor pursuant to this Agreement or the Warrant and
then held by the Investor, upon notice given as provided in clause (b) below, at
the Fair Market Value of the equity security.

         (b)     Notice of every repurchase of equity securities of the Company
held by the  Investor  shall be given at the address and in the manner set forth
for such party in Section 5.6. Each notice of  repurchase  given to the Investor
shall state:  (i) the number and type of securities to be repurchased,  (ii) the
Board of Director's  determination  of Fair Market Value of such  securities and
(iii) the place or places where certificates representing such securities are to
be  surrendered  for payment of the  repurchase  price.  The  repurchase  of the
securities specified in the notice shall occur as soon as practicable  following
the determination of the Fair Market Value of the securities.

         (c)     As used in this Section  4.9, the  following  terms shall have
the following respective meanings:

                  (i)  "Appraisal  Procedure"  means  a  procedure  whereby  two
         independent  appraisers,  one  chosen  by the  Company  and  one by the
         Investor,  shall mutually agree upon the Fair Market Value.  Each party
         shall deliver a notice 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
         Fair Market Value, a third independent appraiser shall be chosen within
         10 days  thereafter by the mutual consent of such first two 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  appointed  and the  determination  of one
         appraiser is disparate from the middle determination by more than twice
         the  amount by which  the other  determination  is  disparate  from the
         middle determination, then the determination of such appraiser shall be
         excluded,  the remaining two determinations  shall be averaged and such
         average  shall be  binding  and  conclusive  upon the  Company  and the
         Investor;  otherwise,  the average 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 Company.

         (ii) "Fair Market Value" means, with respect to any security,  the fair
         market value of such  security as determined by the Board of Directors,
         acting  in  good  faith  in  reliance  on an  opinion  of a  nationally
         recognized  independent investment banking firm 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 determination,  it
         may  object  in  writing  within  10 days of  receipt  of the  Board of
         Director's  determination.  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  are unable to agree on the Fair Market

                                       32
<PAGE>

         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 written  notification
         thereof not later than the 30th day after  delivery  of the  Investor's
         objection.

         4.10    Executive Compensation. Until such time as the Investor ceases
to own any debt or equity  securities of the Company  acquired  pursuant to this
Agreement or the Warrant,  the Company shall take all necessary action to ensure
that its Benefit Plans with respect to its Senior  Executive  Officers comply in
all respects with Section  111(b) of the EESA as  implemented by any guidance or
regulation  thereunder  that has been  issued and is in effect as of the Closing
Date,  and shall  not adopt any new  Benefit  Plan with  respect  to its  Senior
Executive Officers that does not comply therewith.  "Senior Executive  Officers"
means the  Company's  "senior  executive  officers"  as  defined  in  subsection
111(b)(3) of the EESA and regulations issued thereunder, including the rules set
forth in 31 C.F.R. Part 30.

                                    Article V
                                  Miscellaneous

         5.1     Termination. This Agreement may be terminated at any time prior
to the Closing:

         (a)     by either the Investor or the Company if the Closing shall not
have occurred by the 30th  calendar day  following  the Signing Date;  provided,
however,  that in the event the Closing has not  occurred by such 30th  calendar
day, the parties  will consult in good faith to determine  whether to extend the
term 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 not be
under any obligation to extend the term of this Agreement thereafter;  provided,
further,  that the right to terminate this  Agreement  under this Section 5.1(a)
shall not be  available  to any party  whose  breach  of any  representation  or
warranty or failure to perform any obligation  under this  Agreement  shall have
caused or  resulted  in the  failure of the Closing to occur on or prior to such
date; or

         (b)     by  either the  Investor  or the Company in the event that any
Governmental  Entity  shall have issued an order,  decree or ruling or taken any
other action  restraining,  enjoining or otherwise  prohibiting the transactions
contemplated  by this Agreement and such order,  decree,  ruling or other action
shall have become final and nonappealable; or

         (c)     by the mutual written consent of the Investor and the Company.

In the event of  termination  of this Agreement as provided in this Section 5.1,
this Agreement  shall  forthwith  become void and there shall be no liability on
the part of either party hereto except that nothing  herein shall relieve either
party from liability for any breach of this Agreement.

         5.2     Survival of Representations and Warranties.  All covenants and
agreements,  other than  those  which by their  terms  apply in whole or in part

                                       33
<PAGE>

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
will be  effective  unless  made in  writing  and signed by an officer or a duly
authorized  representative  of  each  party;  provided  that  the  Investor  may
unilaterally  amend any  provision of this  Agreement to the extent  required to
comply with any changes after the Signing Date in applicable  federal  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,
power or privilege.  The rights and remedies herein provided shall be cumulative
of any rights or remedies provided by law.

         5.4       Waiver  of  Conditions.   The  conditions  to  each  party's
obligation to consummate the Purchase are for the sole benefit of such party and
may be  waived  by such  party in whole or in part to the  extent  permitted  by
applicable law. No waiver will be effective  unless it is in a writing signed by
a duly authorized  officer of the waiving party that makes express  reference to
the provision or provisions subject to such waiver.

         5.5     Governing Law: Submission to Jurisdiction, Etc. This Agreement
will be  governed by and  construed  in  accordance  with the federal law of the
United  States if and to the extent such law is  applicable,  and  otherwise  in
accordance  with the laws of the State of New York  applicable to contracts made
and to be  performed  entirely  within  such State.  Each of the parties  hereto
agrees  (a) to  submit to the  exclusive  jurisdiction  and venue of the  United
States  District  Court for the District of Columbia and the United States Court
of Federal  Claims for any and all civil actions,  suits or proceedings  arising
out of or  relating  to  this  Agreement  or  the  Warrant  or the  transactions
contemplated  hereby or thereby,  and (b) that notice may be served upon (i) the
Company at the address and in the manner set forth for notices to the Company in
Section 5.6 and (ii) the Investor in accordance  with federal law. To the extent
permitted by applicable  law, each of the parties hereto hereby  unconditionally
waives  trial by jury in any civil legal action or  proceeding  relating to this
Agreement or the Warrant or the transactions contemplated hereby or thereby.

         5.6     Notices. Any notice, request, instruction or other document to
be given  hereunder  by any party to the other  will be in  writing  and will be
deemed  to have  been  duly  given  (a) on the  date of  delivery  if  delivered
personally,  or by facsimile, upon confirmation of receipt, or (b) on the second
business day  following  the date of dispatch if delivered by a recognized  next
day courier service.  All notices to the Company shall be delivered as set forth
in Schedule A, or pursuant to such other  instruction  as may be  designated  in
writing by the Company to the  Investor.  All notices to the  Investor  shall be
delivered as set forth below,  or pursuant to such other  instructions as may be
designated in writing by the Investor to the Company.

                                       34
<PAGE>


                If to the Investor:

                     United States Department of the Treasury
                     1500 Pennsylvania Avenue, NW, Room 2312
                     Washington, 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  "subsidiary"  means  any  corporation,  partnership,  joint
venture, limited liability company or other entity (x) of which such person or a
subsidiary of such person is a general partner or (y) of which a majority of the
voting securities or other voting interests,  or a majority of the securities or
other  interests of which having by their terms ordinary voting power to elect a
majority of the board of directors or persons  performing similar functions with
respect to such entity,  is directly or  indirectly  owned by such person and/or
one or more subsidiaries thereof.

         (b)     The term "Affiliate"  means,  with respect to any person,  any
person directly or indirectly controlling, controlled by or under common control
with, such other person. For purposes of this definition,  "control" (including,
with correlative  meanings,  the terms "controlled by" and "under common control
with") when used with respect to any person,  means the possession,  directly or
indirectly, of the power to cause the direction of management and/or policies of
such person,  whether through the ownership of voting  securities by contract or
otherwise.

         (c)     The terms "knowledge of the Company" or "Company's  knowledge"
mean the actual knowledge after reasonable and due inquiry of the "officers" (as
such term is defined 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  hereof  shall  be
assignable by any party hereto  without the prior  written  consent of the other
party,  and any attempt to assign any right,  remedy,  obligation  or  liability
hereunder without such consent shall be void,  except (a) an assignment,  in the
case of a Business  Combination where such party is not the surviving entity, or
a sale of substantially  all of its assets,  to the entity which is the survivor
of such Business  Combination  or the purchaser in such sale and (b) as provided
in Section 4.5.

         5.9      Severability.  If any  provision  of  this  Agreement  or the
Warrant, or the application thereof to any person or circumstance, is determined
by a court of competent  jurisdiction to be invalid, void or unenforceable,  the
remaining  provisions hereof, or the application of such provision to persons or
circumstances  other  than  those  as to  which  it has  been  held  invalid  or

                                       35
<PAGE>

unenforceable,  will  remain  in full  force and  effect  and shall in no way be
affected,  impaired or  invalidated  thereby,  so long as the  economic or legal
substance of the transactions  contemplated hereby is not affected in any manner
materially  adverse to any party.  Upon such  determination,  the parties  shall
negotiate  in good  faith in an effort to agree upon a  suitable  and  equitable
substitute provision to effect the original intent 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 benefit,  right or remedies,  except
that the  provisions  of Section  4.5 shall  inure to the benefit of the persons
referred to in that Section.

                                      * * *