OR COMMITMENT OF ANY CHARACTER WHATSOEVER RELATING TO, OR SECURITY OR RIGHT
CONVERTIBLE INTO, SHARES OF ANY CAPITAL STOCK OF SUCH COMPANY SUBSIDIARY, AND
THERE ARE NO CONTRACTS, COMMITMENTS, UNDERSTANDINGS OR ARRANGEMENTS BY WHICH ANY
COMPANY SUBSIDIARY IS BOUND TO ISSUE ADDITIONAL SHARES OF ITS CAPITAL STOCK, OR
ANY OPTION, WARRANT OR RIGHT TO PURCHASE OR ACQUIRE ANY ADDITIONAL SHARES OF ITS
CAPITAL STOCK.
ALL OF SUCH SHARES SO OWNED BY THE COMPANY ARE DULY AUTHORIZED
AND VALIDLY ISSUED, FULLY PAID AND NONASSESSABLE AND ARE OWNED BY IT FREE AND
CLEAR OF ANY LIEN, ADVERSE RIGHT OR CLAIM, CHARGE, OPTION, PLEDGE, COVENANT,
TITLE DEFECT, SECURITY INTEREST OR OTHER ENCUMBRANCES OF ANY KIND ("LIENS") WITH
RESPECT THERETO.
EACH COMPANY SUBSIDIARY IS AN ENTITY DULY ORGANIZED, VALIDLY
EXISTING, DULY QUALIFIED TO DO BUSINESS AND IN GOOD STANDING UNDER THE LAWS OF
ITS JURISDICTION OF ORGANIZATION, AND HAS CORPORATE OR OTHER APPROPRIATE
ORGANIZATIONAL POWER AND AUTHORITY TO OWN OR LEASE ITS PROPERTIES AND ASSETS AND
TO CARRY ON ITS BUSINESS AS IT IS NOW BEING CONDUCTED, EXCEPT
6
AS WOULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON THE
COMPANY.
EXCEPT IN RESPECT OF THE COMPANY SUBSIDIARIES, THE COMPANY DOES NOT
OWN BENEFICIALLY, DIRECTLY OR INDIRECTLY, MORE THAN 5% OF ANY CLASS OF EQUITY
SECURITIES OR SIMILAR INTERESTS OF ANY CORPORATION, BANK, BUSINESS TRUST,
ASSOCIATION OR SIMILAR ORGANIZATION, AND IS NOT, DIRECTLY OR INDIRECTLY, A
PARTNER IN ANY PARTNERSHIP OR PARTY TO ANY JOINT VENTURE.
THE COMPANY'S
PRINCIPAL DEPOSITORY INSTITUTION SUBSIDIARY IS DULY ORGANIZED AND VALIDLY
EXISTING AS AN OREGON STATE-CHARTERED COMMERCIAL BANK AND ITS DEPOSIT ACCOUNTS
ARE INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE "FDIC") TO THE
FULLEST EXTENT PERMITTED BY THE FEDERAL DEPOSIT INSURANCE ACT AND THE RULES AND
REGULATIONS OF THE FDIC THEREUNDER, AND ALL PREMIUMS AND ASSESSMENTS REQUIRED TO
BE PAID IN CONNECTION THEREWITH HAVE BEEN PAID WHEN DUE.
THE COMPANY HAS
FURNISHED OR MADE AVAILABLE TO THE INVESTOR, PRIOR TO THE DATE HEREOF, TRUE,
CORRECT AND COMPLETE COPIES OF THE CHARTER AND BYLAWS OF THE COMPANY'S PRINCIPAL
DEPOSITORY INSTITUTION SUBSIDIARY AS AMENDED THROUGH THE DATE OF THIS AGREEMENT.
(C)
CAPITALIZATION.
(1)
THE AUTHORIZED CAPITAL STOCK OF THE COMPANY CONSISTS OF 50,000,000
SHARES OF COMMON STOCK AND 10,000,000 SHARES OF PREFERRED STOCK, NO PAR VALUE
(THE "COMPANY PREFERRED STOCK").
AS OF CLOSE OF BUSINESS ON SEPTEMBER 30, 2009
(THE "CAPITALIZATION DATE"), THERE WERE 15,647,356 SHARES OF COMMON STOCK
OUTSTANDING AND NO SHARES OF COMPANY PREFERRED STOCK OUTSTANDING.
SINCE THE
CAPITALIZATION DATE AND THROUGH THE DATE OF THIS AGREEMENT, EXCEPT IN CONNECTION
WITH THE TRANSACTION DOCUMENTS AND THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY, THE COMPANY HAS NOT (I) ISSUED OR AUTHORIZED THE ISSUANCE OF ANY SHARES
OF COMMON STOCK OR COMPANY PREFERRED STOCK, OR ANY SECURITIES CONVERTIBLE INTO
OR EXCHANGEABLE OR EXERCISABLE FOR SHARES OF COMMON STOCK OR COMPANY PREFERRED
STOCK (OTHER THAN SHARES ISSUED UPON THE EXERCISE OF COMPANY STOCK OPTIONS),
(II) RESERVED FOR ISSUANCE ANY SHARES OF COMMON STOCK OR COMPANY PREFERRED STOCK