ex10-1.htm


    
       

      EXHIBIT
10.1

       

      
        
          United
States Department of the Treasury

          1500
Pennsylvania Avenue, NW

          Washington,
D.C. 2022

        

        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extent supplemented or superseded by the terms set forth herein or in the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.

         

         

         

        * *
*

         

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    
                     
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:

            	
              /s/ Neel
      Kashkari

            
	
               

            	
               

            	
              Name:

            	
              Neel
      Kashkari

            
	
               

            	
               

            	
              Title:

               

            	
              Interim Assistant
      Secretary for Financial  Stability

            
	
               

            	
               

            	
               

            	
               

            
	
               

            	
              CENTRAL
      JERSEY BANCORP

            
	
               

            	
               

            	
               

            	
               

            
	 	 	 	 
	
               

            	
              By:

            	
              /s/ James S.
      Vaccaro

            
	
               

            	
               

            	
              Name:

            	
              James S.
      Vaccaro

            
	
               

            	
               

            	
              Title:

            	
              Chairman, President
      and Chief Executive Officer

            


       

       

      Date:   
December 23, 2008

       

       

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      EXHIBIT
A

       

       SECURITIES
PURCHASE AGREEMENT 

       

       

       

       

       

      
        
          
          

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      


        EXHIBIT
A

         

        


         

        


         

        
          

          

        

        


         

        


         

        SECURITIES
PURCHASE AGREEMENT

         

        STANDARD
TERMS

         

        


         

        


        
          

          

        

         

        


         

        


         

        


         

        


         


        
          
             


          

          
             


            
              

            

          

          
             


          

        


        TABLE
OF CONTENTS

         

        
          
            	 
      	 
      	
                    Page

                  
	
                    Article
      I

                  
	
                    Purchase;
      Closing

                  
	
                    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 Purchased 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

                  	
                    Depositary
      Shares

                  	
                    31

                  
	
                    4.8

                  	
                    Restriction
      on Dividends and Repurchases

                  	
                    31

                  
	
                    4.9

                  	
                    Repurchase
      of Investor Securities

                  	
                    32

                  
	
                    4.10

                  	
                    Executive
      Compensation

                  	
                    33

                  


          

        

        



        
          
             


          

          
            -i-

            
              

            

          

          
             


          

        


        


        
          
            	
                    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

                  
	 
      	 
      	 
      
	 
      	 
      	 
      


          

        


        
          
             


          

          
            -ii-

            
              

            

          

          
             


          

        


        


         

        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-

            
              

            

          

          
             


          

        


        


         

        
          	
                  INDEX
      OF DEFINED TERMS

                   

                  Term

                	
                   

                  Location
      of

                  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-

            
              

            

          

          
             


          

        


        


        
          	
                   

                  Term

                	
                  Location
      of

                  Definition

                
	
                  Parity
      Stock

                	
                  4.8(c)

                
	
                  Pending
      Underwritten Offering

                	
                  4.5(1)

                
	
                  Permitted
      Repurchases

                	
                  4.8(a)(ii)

                
	
                  Piggyback
      Registration

                	
                  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

                	
                  5.8(a)

                
	
                  Tax;
      Taxes

                	
                  2.2(o)

                
	
                  Transfer

                	
                  4.4

                
	
                  Warrant

                	
                  Recitals

                
	
                  Warrant
      Shares

                	
                  2.2(d)

                


        

        


         

        


        
          
            
            

          

          
            -v-

            
              

            

          

          
            
            

          

        

      

      


        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”).

         


        
          
             


          

          
            
            

            
              

            

          

          
             


          

        


        1.2           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 aggregate,
does not have and would not reasonably be expected to have a Company Material
Adverse Effect and (B) the Company shall have

         


        
          
             


          

          
            -2-

            
              

            

          

          
             


          

        


        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-

            
              

            

          

          
             


          

        


        (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
designee(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

         


        
          
             


          

          
            -4-

            
              

            

          

          
             


          

        


        or
occurrences to the extent that such changes or occurrences have or would
reasonably be expected to have a materially disproportionate adverse effect on
the Company and its consolidated subsidiaries taken as a whole relative to
comparable U.S. banking or financial services organizations), or (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

         


        
          
             


          

          
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        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 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

         


        
          
             


          

          
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        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, 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

         


        
          
             


          

          
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        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.

         

        (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

         


        
          
             


          

          
            -8-

            
              

            

          

          
             


          

        


        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) 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

         


        
          
             


          

          
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        Company
Subsidiaries have all permits, licenses, franchises, authorizations, orders and
approvals of, and have made all filings, applications and registrations with,
Governmental Entities that are required in order to permit them to own or lease
their properties and assets and to carry on their business as presently
conducted and that are material to the business of the Company or such Company
Subsidiary. Except as set forth on Schedule E, the
Company and the Company Subsidiaries have complied in all respects and are not
in default or violation of, and 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

         


        
          
             


          

          
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        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 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.

         


        
          
             


          

          
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        (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 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.

         


        
          
             


          

          
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        (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 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

         


        
          
             


          

          
            -13-

            
              

            

          

          
             


          

        


        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 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.

         


        
          
             


          

          
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        (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.

         

        (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

         


        
          
             


          

          
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        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 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.”

         


        
          
             


          

          
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        (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.”

         

        (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

         


        
          
             


          

          
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        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 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,

         


        
          
             


          

          
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        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 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.

         


        
          
             


          

          
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        (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.

         

        (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

         


        
          
             


          

          
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        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 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

         


        
          
             


          

          
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        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.

         

        (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;

         

         

         

        
          
            
            

          

          
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        (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.

         

        (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

         


        
          
             


          

          
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        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” 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

         


        
          
             


          

          
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        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 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 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

         


        
          
             


          

          
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        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 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

         


        
          
             


          

          
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        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 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,

         


        
          
             


          

          
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        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 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

         


        
          
             


          

          
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        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 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.

         

        (iv)            “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.

         

        (v)            “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(1), any underwritten offering
of

         


        
          
             


          

          
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        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 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.

         

         

         

        
          
            
            

          

          
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        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 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

         


        
          
             


          

          
            -31-

            
              

            

          

          
             


          

        


        other
Junior Stock or of Parity Stock or trust preferred securities for or into other
Parity Stock (with the same or lesser aggregate liquidation amount) or Junior
Stock, in each case set forth in this clause (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).

         

        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.

         

         

        
          
            
            

          

          
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        (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 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.

         

         

        
          
            
            

          

          
            -33-

            
              

            

          

          
            
            

          

        

         

        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 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

         


        
          
             


          

          
            -34-

            
              

            

          

          
             


          

        


        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.

         

        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.

         

         

        
          
            
            

          

          
            -35-

            
              

            

          

          
            
            

          

        

         

        (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 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.

         

        * *
*

         

        


         


        
          
            
               

            

             


          

          
            -36-

            
              

            

          

          
             


          

        


        ANNEX
A

         

        FORM OF CERTIFICATE OF
DESIGNATIONS

         

        


         

        


         

        [SEE
ATTACHED]

         

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        
 

        ANNEX
B

         

        FORM OF
WAIVER

         

        In
consideration for the benefits I will receive as a result of my employer’s
participation in the United States Department of the Treasury’s TARP Capital
Purchase Program, I hereby voluntarily waive any claim against the United States
or my employer for any changes to my compensation or benefits that are required
to comply with the regulation issued by the Department of the Treasury as
published in the Federal Register on October 20, 2008.

         

        I
acknowledge that this regulation may require modification of the compensation,
bonus, incentive and other benefit plans, arrangements, policies and agreements
(including so-called “golden parachute” agreements) that I have with my employer
or in which I participate as they relate to the period the United States holds
any equity or debt securities of my employer acquired through the TARP Capital
Purchase Program.

         

        This
waiver includes all claims I may have under the laws of the United States or any
state related to the requirements imposed by the aforementioned regulation,
including without limitation a claim for any compensation or other payments I
would otherwise receive, any challenge to the process by which this regulation
was adopted and any tort or constitutional claim about the effect of these
regulations on my employment relationship.

         

        


        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        ANNEX
C

         

        FORM OF
OPINION

         

        (a)            The
Company has been duly incorporated and is validly existing as a corporation in
good standing under the laws of the state of its incorporation.

         

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

         

        (c)            The
Warrant has been duly authorized and, when executed and delivered as
contemplated by the Agreement, 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.

         

        (d)            The
shares of Common Stock issuable upon exercise of the Warrant have been duly
authorized and reserved for issuance upon exercise of the Warrant and when so
issued in accordance with the terms of the Warrant will be validly issued, fully
paid and non-assessable [insert, if
applicable: , subject to the approvals of the Company’s stockholders set
forth on Schedule
C].

         

        (e)            The
Company has the corporate power and authority to execute and deliver the
Agreement and the Warrant and [insert, if
applicable: , subject to the approvals of the Company’s stockholders set
forth on Schedule
C,] to carry out its obligations thereunder (which includes the issuance
of the Preferred Shares, Warrant and Warrant Shares).

         

        (f)            The
execution, delivery and performance by the Company of the Agreement and the
Warrant and the consummation of the transactions contemplated 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 [insert, if
applicable: , subject, in each case, to the approvals of the Company’s
stockholders set forth on Schedule C]..

         

        (g)            The
Agreement is a valid and binding obligation of the Company enforceable against
the Company in accordance with its terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and general equitable
principles, regardless of whether such enforceability is considered in a
proceeding at law or in equity; provided, however, such
counsel need express no opinion with respect to Section 4.5(g) or the
severability provisions of the Agreement insofar as Section 4.5(g) is
concerned.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        


        ANNEX
D

         

        FORM OF
WARRANT

         

        


         

        [SEE
ATTACHED]

         

        


         

        


         

        


         


        
          
             


          

          
             


            
              

            

          

          
             


          

        



       

       

      SCHEDULE
A

       

       ADDITIONAL
TERMS AND CONDITIONS 

       

       
Company
Information :

       

                     
Name of the Company:  Central
Jersey
Bancorp 

                     
Corporate or other organizational form:  C-Corporation

                     
Jurisdiction of Organization:  New
Jersey

                     
Appropriate Federal Banking Agency:  Federal
Reserve Bank of New York

                     
Notice Information:  James
S. Vaccaro, Chairman, President and CEO, Central Jersey Bancorp, 1903 Highway
35, Oakhurst, New Jersey 07755    

       

       Terms
of the Purchase :

                     
Series of Preferred Stock Purchased:  Senior
Preferred Stock

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

                     
Number of Shares of Preferred Stock Purchased:  11,300

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

                     
Number of Initial Warrant Shares:  268,621

                     
Exercise Price of the Warrant:  $6.31

                     
Purchase Price:  $11,300,000

       

       Closing :

                     
Location of Closing:  Teleconference

                     
Time of Closing:  TBD
by Parties

                     
Date of Closing:  December
23, 2008

      
        
          	 
      	
                  Wire
      Information for Closing:

                	
                  ABA
      Number:

                	
                  [OMITTED]

                
	 
      	 
      	
                  Bank:

                	
                  
                     

                  

                
	 
      	 
      	
                  Account
      Name:

                	
                  
                     

                  

                
	 
      	 
      	
                  Account
      Number:

                	
                  
                     

                  

                
	 
      	 
      	
                  Beneficiary:

                	
                  
                     

                  

                
	 
      	 
      	
                  Attention:

                	
                  
                     

                  

                


        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

     

    
      SCHEDULE
B

      CAPITALIZATION

      


      Capitalization
Date:  November 30,
2008

      


      Common
Stock

      


      Par value:  $0.01 per share

       

      Total Authorized:  100,000,000

       

      Outstanding:  9,008,547

       

      Subject to warrants, options,
convertible

      securities, etc.:  1,337,910

       

      Reserved for benefit plans and
other

      issuances:  926,100

       

      Remaining authorized by
unissued:  90,991,453

       

      Shares issued after Capitalization
Date

      (other than pursuant to warrants,
options,

      convertible securities, etc. as set
forth

      above):  None

      


      Preferred
Stock

      


      Par value:  N/A

       

      Total Authorized:  N/A

       

      Outstanding (by
series):  N/A

       

      Reserved for issuance:  N/A

       

      Remaining authorized by
unissued:  N/A

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        SCHEDULE
C

        REQUIRED STOCKHOLDER
APPROVALS

        


        


        
          	 
      	
                  Required1

                	
                  % Vote Required

                
	 	 	 
	
                  Warrants – Common Stock
      Issuance

                	
                  No

                	
                  N/A

                
	 	 	 
	
                  Charter
      Amendment

                	
                  Yes

                	
                  Majority
      of a Quorum (A quorum is greater than 50%)

                
	 	 	 
	
                  Stock
      Exchange Rules

                	
                  No

                	
                  N/A

                


        

        


        


        If no
stockholder approvals are required, please so indicate by checking the
box: o

         

         

        
 

        
 

         ___________________________

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

        

      

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    
      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:   ý

      


      


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      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:     ý

      


      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:    ý

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      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:   ý