EXHIBIT
10.1


 


LIMITED WAIVER


 


This Limited Waiver (this “Waiver”)
is made as of May 5, 2010 (the “Effective Date”), by and between
FIRST CHESTER COUNTY CORPORATION, a Pennsylvania corporation (“Borrower”)
and GRAYSTONE TOWER BANK, a Pennsylvania chartered bank (“Lender”).  Unless otherwise set forth herein, all
capitalized terms used herein shall have the meaning given such terms in the
Loan Documents (defined below).


 


WHEREAS,
in connection with a loan from Lender to Borrower (the “Loan”), the
Borrower executed and delivered to Lender that certain Promissory Note (“Note”),
that certain Loan Agreement (“Loan Agreement”) and that certain  Pledge Agreement (the “Pledge”), each
dated as of November 20, 2010 (this Waiver, the Note, the Loan Agreement,
the Pledge and any other documents executed by Borrower in connection with the
Loan, in each case as amended through the date hereof, are collectively herein
referred to as the “Loan Documents”);


 


WHEREAS,
the Office of the Comptroller of the Currency (“OCC Letter”) issued a
letter dated November 4, 2009, to First National Bank of Chester County
(the “Bank”) requiring that the Bank achieve and maintain, by December 31,
2009, a Tier 1 leverage capital ratio of not less than 8%, a Tier 1 risk-based
capital ratio of not less than 10%, and a total risk-based capital ratio of not
less than 12%;


 


WHEREAS,
as of March 31, 2010, Bank’s Tier 1 leverage capital ratio was below 8%,
but its Tier 1 risk-based and total risk-based capital ratios were above the
thresholds required by the OCC Letter;


 


WHEREAS,
Section 5.07 of the Loan Agreement requires the Borrower and the Bank to
remain in compliance with any formal or informal regulatory enforcement action
or guidance, including, without limitation, to the extent compliance is required
as of a particular date, the Regulatory Letters (as defined in the Loan
Agreement);


 


WHEREAS,
Section 5.08(b) of the Loan Agreement requires the Borrower and the
Bank to have sufficient capital to satisfy all applicable regulatory
requirements in order to be considered well capitalized by regulatory
authorities, and in order to satisfy any additional requirements imposed by
formal or informal regulatory action; and


 


WHEREAS,
pursuant to Section 8.01 of the Loan Agreement and subject to the terms
and conditions contained herein, Lender is willing to waive compliance with Section 5.08(b) of
the Loan Agreement as it relates to the Bank’s Tier 1 leverage capital ratio
being less than 8% as of March 31, 2010 on the limited basis set forth
herein.


 


NOW,
THEREFORE, in consideration of the foregoing premises, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and fully intending to be legally bound by this Waiver, the
parties hereto agree as follows:


 


1.             Definitions.  Capitalized terms used herein without
definition shall have the meanings assigned to such terms in the Loan
Documents, as applicable.


 

















 


2.             Limited Waiver. 
Pursuant to Section 8.01 of the Loan Agreement and subject to the
limitations contained herein, the undersigned Lender hereby waives Borrower’s
obligation to maintain a Tier 1 leverage capital ratio of at least 8% as of March 31,
2010 pursuant to Section 5.07 and Section 5.08(b) of the Loan
Agreement; provided, however, that such waiver shall be conditioned on
Borrower maintaining, at all times while this Waiver is in effect, a Tier 1
leverage capital ratio of at least 7.75% (the “Waiver Condition”).  The foregoing waiver shall automatically and
without further action terminate if the Waiver Condition shall cease to be
satisfied.


 


3.             Termination.  This Waiver shall terminate automatically
upon the earlier of the submission of the Bank’s Report of Condition and Income
(the “Call Report”) for the quarter ended June 30, 2010 with the Federal Deposit
Insurance Corporation, or July 30, 2010.


 


4.             Provisions Of General
Application.


 


4.1.          Governing Law.  This Waiver shall be deemed to be a contract
made under, and for all purposes shall be construed in accordance with, the
laws of the Commonwealth of Pennsylvania.


 


4.2.          No Other Amendments or Waivers.  The foregoing waivers and modifications are
only effective in the specific instances and for the specific purposes for
which each is given and shall not be effective for any other purposes, and no
provision of the Loan Documents is amended in any way other than as provided
herein and no Default or Event of Default is hereby waived.  Except as otherwise expressly provided or
contemplated by this Waiver, all of the terms, conditions and provisions of the
Loan Agreement remain unaltered and in full force and effect.  This Waiver does not imply any obligation or
agreement by the Lender to make any other amendment, waiver, modification or
consent as to any matter on any subsequent
occasion.


 


4.3.          Assignment.
 This Waiver shall be binding upon and
inure to the benefit of each of the parties hereto and their respective
permitted successors and assigns.


 


4.4.          Counterparts.  This Waiver may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original and it shall not be necessary in making proof of this Waiver to
produce or account for more than one such counterpart.


 


4.5.          Loan Documents.  This Waiver shall be deemed to be a Loan
Document under the Loan Agreement.


 


4.6.          Loan Agreement References.  On and after the effective date of this
Waiver, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “hereof”
or words of like import, and each reference to the Loan Agreement by the words “thereunder”,
“thereof” or words of like import in any Loan Document or other document
executed in connection with the Loan Agreement, shall mean and be a reference
to the Loan Agreement, as modified by this Waiver.


 


[Signature pages follow]


 


2

















 


COUNTERPART SIGNATURE PAGE TO

LIMITED WAIVER


 


IN WITNESS WHEREOF, the parties have executed
this Waiver as of the date first above written.


 


 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  FIRST
  CHESTER COUNTY CORPORATION,

  
	
   

  	
  a
  Pennsylvania Corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  John A. Featherman, III

  
	
   

  	
   

  
	
   

  	
  Name:
  John A. Featherman, III

  
	
   

  	
   

  
	
   

  	
  Title: Chairman, President and Chief Executive
  Officer

  



 

















 


COUNTERPART SIGNATURE PAGE TO

LIMITED WAIVER


 


IN WITNESS WHEREOF, the parties have executed
this Waiver as of the date first above written.


 


 


	
   

  	
  LENDER:

  
	
   

  	
   

  
	
   

  	
  GRAYSTONE
  TOWER BANK, a Pennsylvania

  
	
   

  	
  chartered
  bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Andrew S. Samuel

  
	
   

  	
   

  
	
   

  	
  Name:
  Andrew S. Samuel

  
	
   

  	
   

  
	
   

  	
  Title: President and Chief Executive Officer