Document:

Form of Warrant to Purchase Shares issued to Warburg Pincus Private Equity X, LP

 EXHIBIT 4.8 

Form of Warrant 

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR 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.

 THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO TRANSFER AND OTHER RESTRICTIONS SET FORTH HEREIN AND IN AN INVESTMENT
AGREEMENT, DATED AS OF MAY 25, 2010, COPIES OF WHICH ARE ON FILE WITH THE SECRETARY OF THE ISSUER. 
 WARRANT 

to purchase 

86,625,000 

Shares of Common Stock 

dated as of August 26, 2010 

Sterling Financial Corporation 

a Washington Corporation 

Issue Date: August 26, 2010 

1. Definitions. Unless the context otherwise requires, when used herein the following terms shall have the meanings indicated.

 “Adjustment” has the meaning given to it in Section 13(H). 

“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 or policies of such person, whether through the ownership of voting securities, by contract or otherwise. 

 “Applicable Price” means 95% of
the greater of the Market Price per share of outstanding Common Stock and/or Common Equivalent Preferred Stock, as applicable (A) on the date on which the Company issues or sells any Common Stock and/or Common Equivalent Preferred Stock, as
applicable other than Excluded Stock and (B) the first date of the announcement of such issuance or sale.  

“Appraisal Procedure” means a procedure whereby the Company and the Warrantholder (or if there is
more than one Warrantholder, a majority in interest of Warrantholders) shall mutually agree upon the determinations then the subject of appraisal or dispute, as applicable. If within 30 days after the Appraisal Procedure is invoked, the parties are
unable to agree upon the amount or Disputed Adjustment Matter, as applicable, in question, an independent evaluator shall be chosen within 10 days thereafter by the mutual consent of the parties or, if the parties fail to agree upon the appointment
of an evaluator, such appointment shall be made by the American Arbitration Association, or any organization successor thereto, from a panel of arbitrators having experience in the appraisal of the subject matter to be appraised or evaluated, as
applicable. Within 5 days following the appointment of the evaluator, each of the parties shall submit its determination of the amount or Disputed Adjustment Matter, as applicable, in question to the evaluator and to each other. Each of the parties
shall have 15 days following receipt of the other party’s determination to submit a written rebuttal of such determination to the evaluator. Within 30 days following his or her appointment, the appraiser shall render a decision, which decision
shall be limited to awarding only one of the two such determinations as the final determination with respect to such matter. The costs of conducting any Appraisal Procedure shall be borne by the Warrantholder or Warrantholders, as applicable,
requesting such Appraisal Procedure, except that (A) any costs incurred by the Company shall be borne by the Company and (B) if such Appraisal Procedure shall result in a determination that is disparate by 5% or more from the
Company’s initial determination, all costs of conducting such Appraisal Procedure shall be borne by the Company. 

“Beneficial Owner” and “Beneficial Ownership” have the meanings given to such terms in Rules 13d-3 and
13d-5 of the Exchange Act. 
 “BHC Act” means the Bank Holding Company Act of 1956, as amended, or any
successor statute, and the rules and regulations promulgated thereunder. 
 “Board” means the Board of
Directors of the Company. 
 “Board Representative” has the meaning given to it in the Investment Agreement.

 “Business Combination” means a merger, consolidation, statutory share exchange or similar transaction that
requires adoption by the Company’s stockholders. 
 “Business Day” means any day except Saturday, Sunday
and any day which shall be a legal holiday or a day on which banking institutions in the State of New York or the State of Washington generally are authorized or required by law or other governmental actions to close. 

“Capital Stock” means (A) with respect to any Person that is a corporation or company, any and all shares,
interests, participations or other equivalents (however designated) of capital or capital stock of such Person and (B) with respect to any Person that is not a corporation or company, any and all partnership or other equity interests of such
Person. 
  

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 “CBC Act” means the Change in Bank Control Act of 1978, as amended, and the
rules and regulations promulgated thereunder. 
 “Change of Control” means, with respect to the Company, the
occurrence of any one of the following events: 
 (A) any Person is or becomes a Beneficial Owner (other than the Investor and
its Affiliates), directly or indirectly, of 24.9% or more of the aggregate voting power of the outstanding Voting Securities of the Company and, in connection with or subsequent to such acquisition, the Incumbent Directors cease for any reason to
constitute at least a majority of the Board; provided, that any person becoming a director subsequent to the date of the Investment Agreement whose election or nomination for election was approved by a vote of at least two-thirds of the
Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the relevant party in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent
Director (except that no individuals who were not directors at the time any agreement or understanding with respect to any Business Combination or contested election is reached shall be treated as Incumbent Directors for the purposes of clause
(C) below with respect to such Business Combination or this paragraph in the case of a contested election); provided, further, that the Board Representative will be treated as an Incumbent Director even if the Person designated to
be such Board Representative should change; 
 (B) any Person is or becomes a Beneficial Owner (other than the Investor and its
Affiliates), directly or indirectly, of 50% or more of the aggregate voting power of the outstanding Voting Securities of the Company; provided, however, that the event described in this clause (B) will not be deemed a Change of
Control by virtue of any holdings or acquisitions: (i) by the Company or any of its Subsidiaries, (ii) by any employee benefit plan (or related trust) sponsored or maintained by the Company or any of its Subsidiaries; and provided,
further, that such holdings or acquisitions by any such plan (other than any plan maintained under Section 401(k) of the Internal Revenue Code of 1986, as amended) do not exceed 50% of the then outstanding Voting Securities of the
Company, (iii) by any underwriter temporarily holding securities pursuant to an offering of such securities or (iv) pursuant to a Non-Qualifying Transaction; 

(C) a Business Combination, to the extent it is not a Non-Qualifying Transaction; or 

(D) adoption of a plan of liquidation or dissolution of the Company or a sale of all or substantially all of the Company’s assets.

 “Common Equivalent Preferred Stock” means the Series B Preferred Stock, the Series D Preferred Stock or any
other class or series of Capital Stock of the Company ranking pari passu with the Common Stock as to dividends or payments upon liquidation. 

“Common Stock” means the Company’s common stock, and (except as used in the definition of Non-Qualifying
Transaction) any Capital Stock for or into which such Common Stock hereafter is exchanged, converted, reclassified or recapitalized by the Company or pursuant to an agreement or Business Combination to which the Company is a party. 

 

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 “Company” means Sterling Financial Corporation, a Washington corporation.

 “Disputed Adjustment Matter” has the meaning given to it in Section 13(H). 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and
regulations promulgated thereunder. 
 “Excluded Stock” means (A) shares of Common Stock issued by the
Company as a stock dividend payable in shares of Common Stock, or upon any subdivision or split-up of the outstanding shares of Capital Stock, in each case which is subject to Section 13(B), or upon conversion of shares of Capital Stock (but
not the issuance of such Capital Stock which will be subject to the provision of Section 13(A)), (B) shares of Common Stock to be issued to directors, employees or consultants of the Company pursuant to options, restricted stock units or
other equity-based awards granted prior to the date of issuance of this Warrant and pursuant to options, restricted stock units or other equity-based awards granted after the date of issuance of this Warrant if, in the case of options, the exercise
price per share of Common Stock on the date of such grant equals or exceeds the Market Price of a share of Common Stock on the date of such grant, (C) any options, restricted stock units or other equity-based awards to be issued after the date
of issuance of this Warrant to directors, employees or consultants hired in connection with, and at or around the same time as, the Recapitalization Transactions of the Company, or the issuance of Common Stock to such persons, including pursuant to
any such awards, not to exceed 2.5% of the capital stock of the Company on a fully diluted basis, (D) shares of Common Stock issued upon conversion of the Series B Preferred Stock, (E) shares of Common Stock issued upon conversion of the
Series D Preferred Stock, (F) shares of Common Stock issued upon the conversion of the Series C Preferred Stock, (G) the Treasury Warrant, (H) shares of Common Stock issued upon exercise of the Treasury Warrant,
(I) shares of Series E Preferred Stock or Common Stock issued under the terms of the Shareholder Rights Plan (including upon exercise of Rights (as defined in the Shareholder Rights Plan) issued pursuant thereto), (J) any shares issued to
the Warrantholder or its Affiliates in connection with the exercise by such Person of preemptive rights under the terms of any of the Company’s Capital Stock and (K) any shares of Common Stock, Common Equivalent Preferred Stock or Series C
Preferred Stock issued on the day hereof. 
 “Exercise Price” means $0.22. The Exercise Price shall be subject
to adjustment from time to time in accordance with Section 13. 
 “Expiration Time” has the meaning given
to it in Section 3. 
 “Fair Market Value” means, with respect to any security or other property, the fair
market value of such security or other property as determined by the Board, acting in good faith. If the Warrantholder does not accept the Board’s calculation of Fair Market Value and the Warrantholder and the Company are unable to agree on
Fair Market Value, the procedures described in Section 15 shall be used to determine Fair Market Value. 

“Group” means a “group” within the meaning of Section 13(d)(3) of the Exchange Act. 

 

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 “Incumbent Directors” means individuals who, on the date of the Investment
Agreement, constitute the Board. 
 “Investment Agreement” means the Investment Agreement, dated as of
May 25, 2010, between the Company and the Investor, including all schedules and exhibits thereto. 

“Investor” means Warburg Pincus Private Equity X, L.P. 

“Market Price” of the Common Stock (or other relevant capital stock or equity interest) on any date of determination
means the closing sale price or, if no closing sale price is reported, the last reported sale price of the shares of the Common Stock (or other relevant capital stock or equity interest) on the NASDAQ on such date. If the Common Stock (or other
relevant capital stock or equity interest) is not traded on the NASDAQ on any date of determination, the Closing Price of the Common Stock (or other relevant capital stock or equity interest) on such date of determination means the closing sale
price as reported in the composite transactions for the principal U.S. national or regional securities exchange on which the Common Stock (or other relevant capital stock or equity interest) is so listed or quoted, or, if no closing sale price is
reported, the last reported sale price on the principal U.S. national or regional securities exchange on which the Common Stock (or other relevant capital stock or equity interest) is so listed or quoted, or if the Common Stock (or other relevant
capital stock or equity interest) is not so listed or quoted on a U.S. national or regional securities exchange, the last quoted bid price for the Common Stock (or other relevant capital stock or equity interest) in the over-the-counter market as
reported by Pink Sheets LLC or similar organization, or, if that bid price is not available, the market price of the Common Stock (or other relevant capital stock or equity interest) on that date as determined by a nationally recognized independent
investment banking firm retained by the Company for this purpose. 
 “NASDAQ” means the Nasdaq National Market.

 “Net Income” means net income, excluding the impact of any one-time deferred tax benefit due to the
reduction of valuation allowance against deferred tax assets, extraordinary loan loss provisions or other extraordinary items calculated pursuant to generally acceptable accounting principles consistent with past practice. 

“Non-Qualifying Transaction” means any Business Combination that satisfies all of the following criteria: (A) more
than 50% of the total voting power of the capital stock of the surviving corporation resulting from such Business Combination, or, if applicable, the ultimate parent corporation that directly or indirectly has Beneficial Ownership of 100% of the
voting securities eligible to elect directors of the surviving corporation, is represented by shares of Common Stock that were outstanding immediately before such Business Combination (or, if applicable, is represented by shares into which such
Common Stock was converted pursuant to such Business Combination) and (B) at least a majority of the members of the board of directors of the parent corporation (or, if there is no parent corporation, the surviving corporation) following the
consummation of the Business Combination were Incumbent Directors at the time the Company’s Board approved the execution of the initial agreement providing for such Business Combination. 

 

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 “Ordinary Cash Dividends” means the portion, if any, of any cash dividend
that (i) is made out of surplus or net profits legally available therefor (determined in accordance with generally accepted accounting principles, consistently applied) and (ii) (a) prior to August 26, 2015, does not exceed
$4,500,000 per quarter in the aggregate, and (b) on or after August 26, 2015, does not exceed 20% of the quarterly Net Income of the Company per quarter in the aggregate. 

“Ownership Limit” means at the time of determination, 24.9% of any class of
Voting Securities of the Company outstanding at such time. Any calculation of a Warrantholder’s percentage ownership of the outstanding Voting Securities of the Company for purposes of this definition shall be made in accordance with the
relevant provisions of Regulation Y of the Federal Reserve Board (12 C.F.R. 225 et seq.)  

“Person” has the meaning given to it in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d)(3)
and 14(d)(2) of the Exchange Act. 
 “Preliminary Control Event” means, with respect to the Company,
(A) the execution of definitive documentation for a transaction or (B) the recommendation that stockholders tender in response to a tender or exchange offer, in each case, that could reasonably be expected to result in a Change of Control
upon consummation. 
 “Pro Rata Repurchases” means any purchase of shares of Common Stock by the Company or any
Affiliate thereof pursuant to (A) any tender offer or exchange offer subject to Section 13(e) of the Exchange Act, or (B) pursuant to any other offer available to substantially all holders of Common Stock, in each case whether for
cash, shares of Capital Stock of the Company, other securities of the Company, evidences of indebtedness of the Company or any other Person or any other property (including, without limitation, shares of Capital Stock, other securities or evidences
of indebtedness of a Subsidiary of the Company), or any combination thereof, effected while this Warrant is outstanding; provided, however, that “Pro Rata Repurchase” shall not include any purchase of shares by the Company or
any Affiliate thereof made in accordance with the requirements of Rule 10b-18 as in effect under the Exchange Act. The “Effective Date” of a Pro Rata Repurchase shall mean the date of acceptance of shares for purchase or exchange
under any tender or exchange offer which is a Pro Rata Repurchase or the date of purchase with respect to any Pro Rata Repurchase that is not a tender or exchange offer. 

“Regulatory Approvals” means, as to any Warrantholder, to the extent applicable and required to
permit such Warrantholder to exercise this Warrant for Shares and to own such Common Stock without such Warrantholder being in violation of applicable law, rule or regulation (including the BHC Act and the CBC Act), the receipt or making of
approvals and authorizations of, filings and registrations with, notifications to, or determinations by any U.S. federal, state or foreign governmental authority or self-regulatory organization with respect to any such exercise, including the
expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, if any. 

“SEC” has the meaning given to it in Section 12. 

“Securities” has the meaning given to it in the Investment Agreement. 

 

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 “Securities Act” means the Securities Act of 1933, as amended, or any
successor statute, and the rules and regulations promulgated thereunder. 
 “Series B Preferred Stock”
means the Convertible Participating Voting Preferred Stock, Series B of the Company. 
 “Series C Preferred
Stock” means the Mandatorily Convertible Preferred Stock, Series C of the Company. 
 “Series D Preferred
Stock” means the Convertible Participating Voting Preferred Stock, Series D of the Company. 
 “Series E
Preferred Stock” means the Series E Participating Cumulative Preferred Stock, Series E of the Company. 

“Shareholder Rights Plan” means the Shareholder Rights Plan dated as of April 14, 2010 between the Company and
American Stock Transfer & Trust Company, LLC, as Rights Agent. 
 “Shares” is defined in
Section 2. 
 “Stockholder Proposals” means a proposal to amend the restated articles of incorporation, as
amended, of the Company to increase the number of authorized shares of Common Stock to 10,000,000,000 or such larger number as the Board determines in its reasonable judgment is necessary to comply with any obligations of the Company pursuant to any
agreement entered into in connection with certain recapitalization transactions to occur at or around the date of this Warrant. 

“Subsidiary” of a Person means any corporation, bank, savings bank, association or other Person of which such Person
owns or controls 51% or more of the outstanding equity securities either directly or indirectly through an unbroken chain of entities, as to each of which 51% or more of the outstanding equity securities is owned directly or indirectly by its
parent; provided, however, that there shall not be included any such entity to the extent that the equity securities of such entity were acquired in satisfaction of a debt previously contracted in good faith or are owned or controlled
in a bona fide fiduciary capacity. 
 “Transfer” has the meaning given to it in Section 8(B)(ii).

 “Treasury Warrant” means the Amended and Restated Warrant issued by the Company to the United States
Department of the Treasury on the date hereof. 
 “Voting Securities” means, at any time, shares of any class
of capital stock of the Company that are then entitled to vote generally in the election of directors. 

“Warrantholder” has the meaning given to it in Section 2. 

“Warrant” means this Warrant, issued to the Investor pursuant to the Investment Agreement. 

 

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 “Widely Dispersed Offering” means (a) a widespread public
distribution, (b) a transfer in which no transferee (or group of associated transferees) would receive more than 2% of any class of Voting Securities of the Company or (c) a transfer to a transferee that would control more than 50% of the
Voting Securities of the Company without any transfer from the Investor. 
 2. Number of Shares; Exercise Price. This
certifies that, for value received, Warburg Pincus Private Equity X, L.P., its Affiliates or its registered assigns (the “Warrantholder”) is entitled, upon the terms and subject to the conditions hereinafter set forth, to acquire
from the Company, in whole or in part, up to an aggregate of 86,625,000 fully paid and nonassessable shares of Common Stock (the “Shares”), of the Company, at a purchase price equal to the Exercise Price per Share or to acquire from
the Company shares of Series B Preferred Stock in accordance with Section 14. The number of Shares and the Exercise Price are subject to adjustment as provided herein, and all references to “Shares,” “Common Stock” and
“Exercise Price” herein shall be deemed to include any such adjustment or series of adjustments. 
 3. Exercise of
Warrant; Term. (A) To the extent permitted by applicable laws and regulations, and subject to the restrictions set forth in Section 3(B), the right to purchase the Shares represented by this Warrant is exercisable, in whole or in part
by the Warrantholder, at any time or from time to time after the execution and delivery of this Warrant by the Company, on the date hereof, but in no event later than 11:59 p.m., New York City time, on the seventh anniversary of the date of
issuance of the Warrant (the “Expiration Time”), by (i) the surrender of this Warrant and Notice of Exercise annexed hereto, duly completed and executed on behalf of the Warrantholder, at the office of the Company in Spokane,
Washington (or such other office or agency of the Company in the United States as it may designate by notice in writing to the Warrantholder at the address of the Warrantholder appearing on the books of the Company), and (ii) payment of the
Exercise Price for the Shares thereby purchased at the election of the Warrantholder in one of the following manners: 

(1) by tendering in cash, by certified or cashier’s check payable to the order of the Company, or by wire transfer of
immediately available funds to an account designated by the Company; or 
 (2) by having the Company withhold
shares of Common Stock issuable upon exercise of the Warrant equal in value to the aggregate Exercise Price as to which this Warrant is so exercised based on the Market Price of the Common Stock on the trading day immediately prior to the date on
which this Warrant and the Notice of Exercise are delivered to the Company. 
 If the Warrantholder does not exercise this
Warrant in its entirety, the Warrantholder will be entitled to receive from the Company within a reasonable time, and in any event not exceeding three (3) Business Days, a new warrant in substantially identical form for the purchase of that
number of Shares equal to the difference between the number of Shares subject to this Warrant and the number of Shares as to which this Warrant is so exercised. 
  

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 (B) Notwithstanding anything herein to the contrary, the Warrant shall be exercisable only
as follows: 
 (i) by the Investor pursuant to Section 3(A) for shares of Common Stock, provided that in no event
shall Investor be entitled to receive shares of Common Stock upon the exercise hereof to the extent (but only to the extent) that at the time the Investor exercises the Warrant (1) the Investor has failed to obtain any applicable Regulatory
Approvals or (2) such receipt would cause the Investor to own, or be deemed for applicable bank regulatory purposes to own, Voting Securities of the Company in excess of the Ownership Limit; or 

(ii) by any Warrantholder other than the Investor and its Affiliates, if such Warrantholder shall have acquired this Warrant directly or
indirectly by a transaction or transactions constituting a Widely Dispersed Offering and not in violation of the provisions of Section 8 hereof, for shares of Common Stock, subject to any restrictions or limitations under applicable laws and
regulations. 
 4. Issuance of Shares; Authorization; Listing. Certificates for Shares or Series B Preferred Stock as the
case may be, issued upon exercise of this Warrant will be issued in such name or names as the Warrantholder may designate and will be delivered to such named Person or Persons within a reasonable time, not to exceed 3 Business Days after the date on
which this Warrant has been duly exercised in accordance with the terms of this Warrant. The Company hereby represents and warrants that any Shares or Series B Preferred Stock issued upon the exercise of this Warrant in accordance with the
provisions of Section 3 and all other provisions of this Warrant will be duly and validly authorized and issued, fully paid and nonassessable and free from all taxes, liens and charges (other than liens or charges created by the Warrantholder
or taxes in respect of any transfer occurring contemporaneously therewith). The Company agrees that the Shares or Series B Preferred Stock so issued will be deemed to have been issued to the Warrantholder as of the close of business on the date on
which this Warrant and payment of the Exercise Price are delivered to the Company in accordance with the terms of this Warrant, notwithstanding that the stock transfer books of the Company may then be closed or certificates representing such Shares
or Series B Preferred Stock, as the case may be, may not be actually delivered on such date. Subject to receipt of the approval by the Company’s stockholders of the Stockholder Proposals, the Company will at all times reserve and keep
available, in the case of Common Stock, out of its authorized but unissued Common Stock, and, in the case of the Series B Preferred Stock, out of its authorized but unissued preferred stock, solely for the purpose of providing for the exercise of
this Warrant, the aggregate number of shares of Common Stock and Series B Preferred Stock, as the case may be, then issuable upon exercise of this Warrant. The Company will use reasonable best efforts to (i) procure, at its sole expense, the
listing of (A) the Shares issuable upon exercise of this Warrant, including but not limited to those Shares issuable pursuant to Section 13 of this Warrant and (B) in the event that the approval by the Company’s stockholders of
the Stockholder Proposals has not been received within 120 days of the date of this Warrant, any other securities issuable upon exercise of this Warrant, in each of cases (A) and (B) subject to issuance or notice of issuance on all stock
exchanges on which the Common Stock are then listed or traded and (ii) maintain the listing of such Shares after issuance. The Company will use commercially reasonable efforts to ensure that the Shares and the Series B Preferred Stock may be
issued without violation of any applicable law or regulation or of any requirement of any securities exchange on which the Shares or Series B Preferred Stock, as the case may be, are listed or traded. 

 

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 5. No Fractional Shares or Scrip. No fractional shares or scrip representing
fractional shares shall be issued upon any exercise of this Warrant. In lieu of any fractional share to which the Warrantholder would otherwise be entitled, the Warrantholder shall be entitled to receive a cash payment equal to the Market Price of
the Common Stock less the pro-rated Exercise Price for such fractional share. 
 6. No Rights as Shareholders; Transfer
Books. This Warrant does not entitle the Warrantholder to any voting rights or other rights as a shareholder of the Company prior to the date of exercise hereof. The Company will at no time close its transfer books against transfer of this
Warrant in any manner which interferes with the timely exercise of this Warrant. 
 7. Charges, Taxes and Expenses.
Issuance of certificates for Shares to the Warrantholder upon the exercise of this Warrant shall be made without charge to the Warrantholder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificates,
all of which taxes and expenses shall be paid by the Company. 
 8. Transfer/Assignment. This Warrant and all rights
hereunder are transferable, in whole or in part, upon the books of the Company by the registered holder hereof in person or by duly authorized attorney, and a new warrant shall be made and delivered by the Company, of the same tenor and date as this
Warrant but registered in the name of the transferee, upon surrender of this Warrant, duly endorsed, to the office or agency of the Company described in Section 2. All expenses (other than stock transfer taxes) and other charges payable in
connection with the preparation, execution and delivery of the new warrants pursuant to this Section 8 shall be paid by the Company. Notwithstanding the foregoing, the Investor shall comply with the transfer restrictions set forth in the
Charter Amendment Proposal (as defined in the Investment Agreement) as if the Charter Amendment Proposal had been approved and effective as of the Closing Date (as defined in the Investment Agreement) until such time as the Charter Amendment
Proposal actually is approved and effective. Following the approval of the Charter Amendment Proposal (or other similar amendment to the Company’s Articles of Incorporation), the Investor shall comply with the transfer restrictions contained
therein. 
 9. Exchange and Registry of Warrant. This Warrant is exchangeable, upon the surrender hereof by the
Warrantholder to the Company, for a new warrant or warrants of like tenor and representing the right to purchase the same aggregate number of Shares. The Company shall maintain a registry showing the name and address of the Warrantholder as the
registered holder of this Warrant. This Warrant may be surrendered for exchange or exercise, in accordance with its terms, at the office of the Company, and the Company shall be entitled to rely in all respects, prior to written notice to the
contrary, upon such registry. 
 10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant, and in the case of any such loss, theft or destruction, upon receipt of an indemnity or security reasonably satisfactory to the Company, or, in the
case of any such mutilation, upon surrender and cancellation of this Warrant, the Company shall make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the right to purchase the
same aggregate number of Shares as provided for in such lost, stolen, destroyed or mutilated Warrant. 
  

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 11. Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding day that is a Business Day. 

12. Rule 144 Information. The Company covenants that it will use its reasonable best efforts to timely file all reports and other
documents required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations promulgated by the U.S. Securities and Exchange Commission (the “SEC”) thereunder (or, if the Company is not required
to file such reports under the Securities Act or the Exchange Act, it will, upon the request of any Warrantholder, make publicly available such information as necessary to permit sales pursuant to Rule 144), and it will use reasonable best efforts
to take such further action as any Warrantholder may reasonably request, all to the extent required from time to time to enable such holder to sell the Warrants without registration under the Securities Act within the limitation of the exemptions
provided by (i) Rule 144 or Regulation S under the Securities Act, as such rules may be amended from time to time, or (ii) any successor rule or regulation hereafter adopted by the SEC. Upon the written request of any Warrantholder,
the Company will deliver to such Warrantholder a written statement that it has complied with such requirements. 
 13.
Adjustments and Other Rights. The Exercise Price and the number of Shares issuable upon exercise of this Warrant shall be subject to adjustment from time to time as follows; provided, that no single event shall be subject to adjustment
under more than one sub-section of this Section 13 so as to result in duplication; provided, further, that, notwithstanding any provision of this Warrant to the contrary, any adjustment shall be made to the extent (and only
to the extent) that such adjustment would not cause or result in any Warrantholder and its Affiliates, collectively, being in violation of the Ownership Limit (excluding for purposes of this calculation any reduction in the percentage of Voting
Securities or other capital stock of the Company such Warrantholder and its Affiliates so owns, controls or has the power to vote resulting from transfers by the Investor and its Affiliates of Securities purchased by the Investor pursuant to the
Investment Agreement) or any other applicable law, regulation or rule of any governmental authority or self-regulatory organization. Any adjustment (or portion thereof) prohibited pursuant to the foregoing proviso shall be postponed and implemented
on the first date on which such implementation would not result in the condition described in such proviso.  
 (A)
Common Stock Issued at Less than the Applicable Price. (i) If the Company issues or sells, or agrees to issue or sell, any Common Stock or other securities that are convertible into or exchangeable or exercisable for or otherwise linked
to Common Stock, other than Excluded Stock, for consideration per share less than the Applicable Price then the Exercise Price in effect immediately prior to each such issuance or sale will immediately (except as provided below) be reduced to the
price determined by multiplying the Exercise Price in effect immediately prior to such issuance or sale by a fraction, (x) the numerator of which shall be (1) the number of shares of Common Stock outstanding immediately prior to such
issuance or sale (including, to the extent applicable, the number of shares of Common Stock into which any shares of Series B Preferred Stock and Series D Preferred Stock then outstanding are convertible and into which this Warrant and the Treasury
Warrant are exercisable) plus (2) the number of shares of Common Stock which the aggregate consideration received by the Company for the total number of such additional shares of Common Stock so issued or sold would purchase at the

  

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Applicable Price, and (y) the denominator of which shall be the number of shares of Common Stock outstanding immediately after such issuance or sale (including, to the extent applicable, the
number of shares of Common Stock into which any shares of Series B Preferred Stock and Series D Preferred Stock then outstanding are convertible and into which this Warrant and the Treasury Warrant are exercisable). In such event, the number of
shares of Common Stock issuable upon the exercise of this Warrant shall be increased to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment and
(2) the Exercise Price in effect immediately prior to the issuance or sale giving rise to this adjustment, by (y) the new Exercise Price determined in accordance with the immediately preceding sentence. For the avoidance of doubt, no
increase in the Exercise Price or reduction in the number of Shares issuable upon exercise of this Warrant shall be made pursuant to this sub-clause (i) of this Section 13(A). 

(ii) For the purposes of any adjustment of the Exercise Price and the number of Shares issuable upon exercise of this Warrant pursuant to
this Section 13(A), the following provisions shall be applicable: 
 (1) In the case of the issuance or sale
of equity or equity-linked securities for cash, the amount of the consideration received by the Company shall be deemed to be the amount of the gross cash proceeds received by the Company for such securities before deducting therefrom any discounts
or commissions allowed, paid or incurred by the Company for any underwriting or otherwise in connection with the issuance and sale thereof. 

(2) In the case of the issuance or sale of equity or equity-linked securities (otherwise than upon the conversion of
shares of Capital Stock or other securities of the Company) for a consideration in whole or in part other than cash, including securities acquired in exchange therefor (other than securities by their terms so exchangeable), the consideration other
than cash shall be deemed to be the Fair Market Value, before deducting therefrom any discounts or commissions allowed, paid or incurred by the Company for any underwriting or otherwise in connection with the issuance and sale thereof. 

(3) In the case of the issuance of (i) options, warrants or other rights to purchase or acquire equity or
equity-linked securities (whether or not at the time exercisable) or (ii) securities by their terms convertible into or exchangeable for equity or equity-linked securities (whether or not at the time so convertible or exchangeable) or options,
warrants or rights to purchase such convertible or exchangeable securities (whether or not at the time exercisable): 

(a) The aggregate maximum number of shares of securities deliverable upon exercise of such options, warrants or other
rights to purchase or acquire equity or equity-linked securities shall be deemed to have been issued at the time such options, warrants or rights are issued and for a consideration equal to the consideration (determined in the manner provided in
Section 13(A)(i) and (ii)), if any, received by the Company upon the issuance or sale of such options, warrants or rights plus the minimum purchase price provided in such options, warrants or rights for the equity or equity-linked securities
covered thereby. 
  

 12 

 (b) The aggregate maximum number of shares of equity or equity-linked
securities deliverable upon conversion of or in exchange for any such convertible or exchangeable securities, or upon the exercise of options, warrants or other rights to purchase or acquire such convertible or exchangeable securities and the
subsequent conversion or exchange thereof, shall be deemed to have been issued at the time such securities were issued or such options, warrants or rights were issued and for a consideration equal to the consideration, if any, received by the
Company for any such securities and related options, warrants or rights (excluding any cash received on account of accrued interest or accrued dividends), plus the additional consideration (in each case, determined in the manner provided in
Section 13(A)(i) and (ii)), if any, to be received by the Company upon the conversion or exchange of such securities, or upon the exercise of any related options, warrants or rights to purchase or acquire such convertible or exchangeable
securities and the subsequent conversion or exchange thereof. 
 (c) On any change in the number of shares of
equity or equity-linked securities deliverable upon exercise of any such options, warrants or rights or conversion or exchange of such convertible or exchangeable securities or any change in the consideration to be received by the Company upon such
exercise, conversion or exchange, but excluding changes resulting from the anti-dilution provisions thereof (to the extent comparable to the anti-dilution provisions contained herein), the Exercise Price and the number of Shares issuable upon
exercise of this Warrant as then in effect shall forthwith be readjusted to such Exercise Price and number of Shares as would have been obtained had an adjustment been made upon the issuance or sale of such options, warrants or rights not exercised
prior to such change, or of such convertible or exchangeable securities not converted or exchanged prior to such change, upon the basis of such change. 

(d) If the Exercise Price and the number of Shares issuable upon exercise of this Warrant shall have been adjusted upon
the issuance or sale of any such options, warrants, rights or convertible or exchangeable securities, no further adjustment of the Exercise Price and the number of Shares issuable upon exercise of this Warrant shall be made for the actual issuance
of Common Stock upon the exercise, conversion or exchange thereof. 
 (B) Stock Splits, Subdivisions, Reclassifications or
Combinations. If the Company shall (i) declare a dividend or make a distribution on its Common Stock in shares of Common Stock, (ii) subdivide or reclassify the outstanding shares of Common Stock into a greater number of shares, or
(iii) combine or reclassify the outstanding Common Stock into a smaller number of 
  

 13 

 
shares, the number of Shares issuable upon exercise of this Warrant at the time of the record date for such dividend or distribution or the effective date of such subdivision, combination or
reclassification shall be proportionately adjusted so that the Warrantholder after such date shall be entitled to purchase the number of shares of Common Stock which such holder would have owned or been entitled to receive after such date had this
Warrant been exercised immediately prior to such date. In such event, the Exercise Price in effect at the time of the record date for such dividend or distribution or the effective date of such subdivision, combination or reclassification shall be
adjusted to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment and (2) the Exercise Price in effect immediately prior to the record or
effective date, as the case may be, for such dividend, distribution, subdivision, combination or reclassification giving rise to this adjustment by (y) the new number of Shares issuable upon exercise of this Warrant determined pursuant to the
immediately preceding sentence. 
 (C) Other Distributions. In case the Company shall fix a record date for the making of
a distribution to all holders of shares of its Common Stock (i) of shares of any class other than its Common Stock, (ii) of evidence of indebtedness of the Company or any Subsidiary, (iii) of assets or cash (excluding the amount of
Ordinary Cash Dividends, and dividends or distributions referred to in Section 13(B)), or (iv) of rights or warrants (other than in connection with the adoption of a shareholder rights plan), in each such case, the Exercise Price in effect
prior thereto shall be reduced immediately thereafter to the price determined by dividing (x) an amount equal to the difference resulting from (1) the number of shares of Common Stock outstanding on such record date multiplied by the
Exercise Price per Share on such record date, less (2) the Fair Market Value of said shares or evidences of indebtedness or assets or rights or warrants to be so distributed, by (y) the number of shares of Common Stock outstanding on such
record date; such adjustment shall be made successively whenever such a record date is fixed. In such event, the number of shares of Common Stock issuable upon the exercise of this Warrant shall be increased to the number obtained by dividing
(x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment, and (2) the Exercise Price in effect immediately prior to the issuance giving rise to this adjustment by (y) the new
Exercise Price determined in accordance with the immediately preceding sentence. In the event that such distribution is not so made, the Exercise Price and the number of Shares issuable upon exercise of this Warrant then in effect shall be
readjusted, effective as of the date when the Board determines not to distribute such shares, evidences of indebtedness, assets, rights or warrants, as the case may be, to the Exercise Price that would then be in effect and the number of Shares that
would then be issuable upon exercise of this Warrant if such record date had not been fixed. 
 (D) Certain Repurchases of
Common Stock. In case the Company effects a Pro Rata Repurchase of Common Stock, then the Exercise Price shall be reduced to the price determined by multiplying the Exercise Price in effect immediately prior to the effective date of such Pro
Rata Repurchase by a fraction of which the numerator shall be (i) the product of (x) the number of shares of Common Stock outstanding immediately before such Pro Rata Repurchase and (y) the Market Price of a share of Common Stock on
the trading day immediately preceding the first public announcement by the Company or any of its Affiliates of the intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase price of the Pro Rata Repurchase, and of which the
denominator shall be the product of (i) the number of shares of Common Stock outstanding immediately prior to such Pro Rata Repurchase minus the number of shares of 

 

 14 

 
Common Stock so repurchased and (ii) the Market Price per share of Common Stock on the trading day immediately preceding the first public announcement of such Pro Rata Repurchase. In such
event, the number of shares of Common Stock issuable upon the exercise of this Warrant shall be increased to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such
adjustment, and (2) the Exercise Price in effect immediately prior to the Pro Rata Repurchase giving rise to this adjustment by (y) the new Exercise Price determined in accordance with the immediately preceding sentence. 

(E) Business Combinations. In case of any Business Combination or reclassification of Common Stock (other than a reclassification
of Common Stock referred to in Section 13(B)), any Shares (assuming, for these purposes, that the Stockholder Approval shall have been obtained) issued or issuable upon exercise of this Warrant after the date of such Business Combination or
reclassification shall be exchangeable for the number of shares of stock or other securities or property (including cash) to which the Common Stock issuable (at the time of such Business Combination or reclassification) upon exercise of this Warrant
immediately prior to the consummation of such Business Combination or reclassification would have been entitled upon consummation of such Business Combination or reclassification; and in any such case, if necessary, the provisions set forth herein
with respect to the rights and interests thereafter of the Warrantholder shall be appropriately adjusted so as to be applicable, as nearly as may reasonably be, to any shares of stock or other securities or property thereafter deliverable on the
exercise of this Warrant. In determining the kind and amount of stock, securities or the property receivable upon consummation of such Business Combination, if the holders of Common Stock have the right to elect the kind or amount of consideration
receivable upon consummation of such Business Combination, then the Warrantholder shall have the right to make a similar election upon exercise of this Warrant with respect to the number of shares of stock or other securities or property which the
Warrantholder will receive upon exercise of this Warrant. 
 (F) Rounding of Calculations; Minimum Adjustments. All
calculations under this Section 13 shall be made to the nearest one-tenth (1/10th) of a cent. Any provision of this Section 13 to the contrary notwithstanding, no adjustment in the Exercise Price or the number of Shares into which
this Warrant is exercisable shall be made if the amount of such adjustment would be less than $0.01, but any such amount shall be carried forward and an adjustment with respect thereto shall be made at the time of and together with any subsequent
adjustment which, together with such amount and any other amount or amounts so carried forward, shall aggregate $0.01 or more. 

(G) Timing of Issuance of Additional Common Stock Upon Certain Adjustments. In any case in which the provisions of this
Section 13 shall require that an adjustment shall become effective immediately after a record date for an event, the Company may defer until the occurrence of such event (i) issuing to the Warrantholder of this Warrant exercised after such
record date and before the occurrence of such event the additional shares of Common Stock issuable upon such exercise by reason of the adjustment required by such event over and above the shares of Common Stock issuable upon such exercise before
giving effect to such adjustment and (ii) paying to such Warrantholder any amount of cash in lieu of a fractional share of Common Stock; provided, however, that the Company upon request shall deliver to such Warrantholder a due
bill or other appropriate instrument evidencing such Warrantholder’s right to receive such additional shares, and such cash, upon the occurrence of the event requiring such adjustment. 

 

 15 

 (H) Adjustment for Unspecified Actions. If the Company takes any action affecting the
Common Stock or the Common Equivalent Preferred Stock, other than actions described in this Section 13, which in the reasonable judgment of the Board would adversely affect the exercise rights of the Warrantholder, the Exercise Price for the
Warrant and/or the number of Shares received upon exercise of the Warrant shall be adjusted for the Warrantholder’s benefit (the “Adjustment”), to the extent permitted by law, in such manner, and at such time, as the Board
after consultation with the Warrantholder shall reasonably determine to be equitable in the circumstances. In the event that an Adjustment or the Board’s failure to make an Adjustment is disputed (each, a “Disputed Adjustment
Matter”), such Disputed Adjustment Matter shall be resolved through the Appraisal Procedure mutatis mutandis. 

(I) Statement Regarding Adjustments. Whenever the Exercise Price or the number of Shares into which this Warrant is exercisable
shall be adjusted as provided in Section 13, the Company shall forthwith file at the principal office of the Company a statement showing in reasonable detail the facts requiring such adjustment and the Exercise Price that shall be in effect and
the number of Shares into which this Warrant shall be exercisable after such adjustment, and the Company shall also cause a copy of such statement to be sent by mail, first class postage prepaid, to each Warrantholder at the address appearing in the
Company’s records. 
 (J) Notice of Adjustment Event. In the event that the Company shall propose to take any action
of the type described in this Section 13 (but only if the action of the type described in this Section 13 would result in an adjustment in the Exercise Price or the number of Shares into which this Warrant is exercisable or a change in the
type of securities or property to be delivered upon exercise of this Warrant), the Company shall give notice to the Warrantholder, in the manner set forth in Section 13(I), which notice shall specify the record date, if any, with respect to any
such action and the approximate date on which such action is to take place. Such notice shall also set forth the facts with respect thereto as shall be reasonably necessary to indicate the effect on the Exercise Price and the number, kind or class
of shares or other securities or property which shall be deliverable upon exercise of this Warrant. In the case of any action which would require the fixing of a record date, such notice shall be given at least 10 days prior to the date so fixed,
and in case of all other action, such notice shall be given at least 15 days prior to the taking of such proposed action. Failure to give such notice, or any defect therein, shall not affect the legality or validity of any such action. 

(K) No Impairment. The Company will not, by amendment of its certificate of incorporation or through any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all
times in good faith assist in the carrying out of all the provisions of this Warrant and in taking of all such action as may be necessary or appropriate in order to protect the rights of the Warrantholder. 

(L) Proceedings Prior to Any Action Requiring Adjustment. As a condition precedent to the taking of any action which would require
an adjustment pursuant to this 
  

 16 

 
Section 13, the Company shall take any action which may be necessary, including obtaining regulatory, NASDAQ or stockholder approvals or exemptions, in order that the Company may thereafter
validly and legally issue as fully paid and nonassessable all shares of Common Stock that the Warrantholder is entitled to receive upon exercise of this Warrant pursuant to this Section 13. 

(M) Adjustment Rules. Any adjustments pursuant to this Section 13 shall be made successively whenever an event referred to
herein shall occur. If an adjustment in Exercise Price made hereunder would reduce the Exercise Price to an amount below par value of the Common Stock, then such adjustment in Exercise Price made hereunder shall reduce the Exercise Price to the par
value of the Common Stock. 
 (N) Notwithstanding anything to contrary set forth herein, the Exercise Price and the number of
Shares issuable upon exercise of this Warrant shall also be subject to adjustment from time to time as set forth in this Section 13 as applied to any Common Equivalent Preferred Stock, mutatis mutandis. 

14. Exercise for Series B Preferred Stock. Prior to the receipt of all necessary approvals of the Company’s stockholders of
the Stockholder Proposals, the Warrantholder may exercise all or any part of this Warrant for a number of shares of Series B Preferred Stock that would be convertible in accordance with the terms thereof into that number of shares of Common Stock it
would otherwise be entitled to receive in accordance with Section 3. The Company will at all times reserve and keep available, out of its authorized preferred stock, a sufficient number of shares of preferred stock for the purpose of providing
for the exchange of this Warrant for shares of Series B Preferred Stock. It is understood and agreed that, in lieu of delivering shares of Series B Preferred Stock pursuant to this Section 14, the Company may deliver depositary shares for
shares of a new series of preferred stock having rights, preferences and privileges identical to the Series B Preferred Stock. 

15. Contest and Appraisal Rights. Upon each determination of Market Price or Fair Market Value, as the case may be, hereunder, the
Company shall promptly give notice thereof to the Warrantholder, setting forth in reasonable detail the calculation of such Market Price or Fair Market Value, and the method and basis of determination thereof, as the case may be. If the
Warrantholder (or if there is more than one Warrantholder, a majority in interest of Warrantholders) shall disagree with such determination and shall, by notice to the Company given within 15 days after the Company’s notice of such
determination, elect to dispute such determination, such dispute shall be resolved in accordance with this Section 15. In the event that a determination of Market Price, or Fair Market Value (if such determination solely involves Market Price),
is disputed, such dispute shall be submitted, at the Company’s expense, to a NASDAQ member firm selected by the Company and acceptable to the Warrantholder, whose determination of Market Price or Fair Market Value, as the case may be, shall be
binding on the Company and the Warrantholder. In the event that a determination of Fair Market Value, other than a determination solely involving Market Price, is disputed, such dispute shall be resolved through the Appraisal Procedure. 

16. Governing Law. This Warrant shall be binding upon any successors or assigns of the Company. This Warrant shall constitute a
contract under the laws of the State of New York and for all purposes shall be construed in accordance with and governed by the laws of the State of New York applicable to agreements made and to be performed entirely within such state. 

 

 17 

 17. Attorneys’ Fees. In any litigation, arbitration or court proceeding between
the Company and the Warrantholder as the holder of this Warrant relating hereto, the prevailing party shall be entitled to reasonable attorneys’ fees and expenses incurred in enforcing this Warrant. 

18. Amendments. This Warrant may be amended and the observance of any term of this Warrant may be waived only, in the case of an
amendment, with the written consent of the Company and the Warrantholder, or in the case of a waiver, by the party against whom the waiver is to be effective. 

19. Notices. All notices hereunder shall be in writing and shall be effective (A) on the day on which delivered if delivered
personally or transmitted by telex or telegram or telecopier with evidence of receipt, (B) one Business Day after the date on which the same is delivered to a nationally recognized overnight courier service with evidence of receipt, or
(C) five Business Days after the date on which the same is deposited, postage prepaid, in the U.S. mail, sent by certified or registered mail, return receipt requested, and addressed to the party to be notified at the address indicated below
for the Company, or at the address for the Warrantholder set forth in the registry maintained by the Company pursuant to Section 9, or at such other address and/or telecopy or telex number and/or to the attention of such other person as the
Company or the Warrantholder may designate by ten-day advance written notice. 
  

					
		 	If to the Investor:	 	
			
		 	     Warburg Pincus Private Equity X, L.P.

    450 Lexington Avenue

    New York, New York 10017-3140

    Attn: Dan Zilberman

    Facsimile: (212) 716-8626
	 	
			
		 	with a copy to (which copy alone shall not constitute notice):	 	
			
		 	     Sullivan & Cromwell LLP

    125 Broad Street

    New York, NY 10004

    Attn: Mitchell S. Eitel

             Andrew R. Gladin

    Facsimile: (212) 558-3588
	 	
			
		 	If to the Company:	 	
			
		 	     Sterling Financial Corporation

    111 North Wall Street

    Spokane, WA 99201

    Attn: J. Gregory Seibly

    Facsimile: (509) 358-6191
	 	

  

 18 

					
		 	 with a copy to (which copy alone shall not constitute notice):

 
     Davis Polk & Wardwell LLP

    450 Lexington Avenue

    New York, New York 10017

    Attn: John Douglas

    Facsimile: (212) 701-5145
	 	

 20. Prohibited Actions. The Company agrees that it will not take any action which would
entitle the Warrantholder to an adjustment of the Exercise Price if the total number of shares of Common Stock issuable after such action upon exercise of this Warrant, together with all shares of Common Stock then outstanding and all shares of
Common Stock then issuable upon the exercise of all outstanding options, warrants, conversion and other rights, would exceed the total number of shares of Common Stock then authorized by its certificate of incorporation. 

21. Entire Agreement. This Warrant and the forms attached hereto, and the Investment Agreement, contain the entire agreement
between the parties with respect to the subject matter hereof and supersede all prior and contemporaneous arrangements or undertakings with respect thereto. 

[Remainder of page intentionally left blank] 
  

 19 

 IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by a duly authorized
officer. 
 Dated as of the date set forth above. 

 

			
	STERLING FINANCIAL CORPORATION
		
	 By:
	 	  

	Name:	 	J. Gregory Seibly
	Title:	 	President and Chief Executive Officer

  

			
	Attest:
		
	By:	 	  

	Name:	 	Daniel G. Byrne
	Title:	 	Executive Vice President and Chief Financial Officer

[Signature Page to WP Warrant] 
  

 20 

			
	Acknowledged and Agreed:
	
	WARBURG PINCUS PRIVATE EQUITY X, L.P.
		
	By:	 	Warburg Pincus X LLC, its general partner
	By:	 	Warburg Pincus Partners LLC, its sole member
	By:	 	Warburg Pincus & Co., its managing member
		
	By:	 	  

	Name:	 	Dan Zilberman
	Title:	 	Partner

 [Signature Page to WP Warrant]

  

 21 

 [Form Of Notice Of Exercise] 

Date:
                         

TO: Sterling Financial Corporation 
 RE:
Election to Subscribe for and Purchase Common Stock 
 The undersigned, pursuant to the provisions set forth in the attached
Warrant, hereby agrees to subscribe for and purchase the number of shares of the Common Stock set forth below covered by such Warrant. The undersigned, in accordance with Section 3 of the Warrant, hereby agrees to pay the aggregate Exercise
Price for such shares of Common Stock in the manner set forth below. A new warrant evidencing the remaining shares of Common Stock covered by such Warrant, but not yet subscribed for and purchased, should be issued in the name set forth below. If
the new warrant is being transferred, an opinion of counsel is attached hereto with respect to the transfer of such warrant. 
 Number of Shares
of Common
Stock:                                      

 Method of Payment of Exercise
Price:                                      

Name and Address of Person to be 
 Issued New
Warrant:                                       
                          

 

			
	Holder:	 	  

		
	 By:
	 	  

		
	 Name:
	 	  

		
	 Title:
	 	  

 [Form
of Notice of Exercise] 
  

 22Amended and Restated Warrant to Purchase Shares

 EXHIBIT 4.9 

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. 
 AMENDED AND RESTATED 

WARRANT 

to purchase 

6,437,677 

Shares of Common Stock 

of Sterling Financial Corporation 

Issue Date: August 26, 2010 

1. Definitions. Unless the context otherwise requires, when used herein the following terms shall have the meanings indicated.

 “Affiliate” has the meaning ascribed to it in the Exchange Agreement. 

“Appraisal Procedure” means a procedure whereby two independent appraisers, one chosen by the Company and one by the
Original Warrantholder, shall mutually agree upon the determinations then the subject of appraisal. Each party shall deliver a notice to the other appointing its appraiser within 15 days after the Appraisal Procedure is invoked. If within 30 days
after appointment of the two appraisers they are unable to agree upon the amount in question, 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 Original Warrantholder; otherwise, the average of all three determinations shall be binding upon the Company and the Original Warrantholder. The costs of conducting any Appraisal Procedure shall be borne by the Company.

 “Board of Directors” means the board of directors of the Company, including any duly authorized committee
thereof. 
 “Business Combination” means a merger, consolidation, statutory share exchange or similar
transaction that requires the approval of the Company’s stockholders. 

 “business day” means 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. 

“Capital Stock” means (A) with respect to any Person that is a corporation or company, any and all shares,
interests, participations or other equivalents (however designated) of capital or capital stock of such Person and (B) with respect to any Person that is not a corporation or company, any and all partnership or other equity interests of such
Person. 
 “Charter” means, with respect to any Person, its certificate or articles of incorporation, articles
of association, or similar organizational document. 
 “Common Stock” means the common stock, par value $0.00
per share, of the Company. 
 “Common Stock Issuance” has the meaning set forth in Section 13(B).

 “Company” means the Person whose name, corporate or other organizational form and jurisdiction of
organization is set forth in Item 1 of Schedule A hereto. 
 “convertible securities” has the
meaning set forth in Section 13(B). 
 “Exchange Act” means the Securities Exchange Act of 1934, as
amended, or any successor statute, and the rules and regulations promulgated thereunder. 
 “Exchange
Agreement” means the Exchange Agreement, dated as of April 29, 2010, as amended from time to time, between the Company and the United States Department of the Treasury, including all annexes and schedules thereto. 

“Exercise Price” means the amount set forth in Item 2 of Schedule A hereto. 

“Expiration Time” has the meaning set forth in Section 3. 

“Fair Market Value” means, with respect to any security or other property, the fair market value of such security or
other property as determined by the Board of Directors, acting in good faith or, with respect to Section 14, as determined by the Original Warrantholder acting in good faith. For so long as the Original Warrantholder holds this Warrant or any
portion thereof, it may object in writing to the Board of Directors’ calculation of fair market value within 10 days of receipt of written notice thereof. If the Original Warrantholder and the Company are unable to agree on fair market value
during the 10-day period following the delivery of the Original Warrantholder’s objection, the Appraisal Procedure may be invoked by either party to determine Fair Market Value by delivering written notification thereof not later than the 30th
day after delivery of the Original Warrantholder’s objection. 
 “Initial Number” has the meaning set
forth in Section 13(B)(1). 
 “Investment Agreements” means (i) the Second Amended and Restated
Investment Agreement, dated as of May 25, 2010, between the Company, on the one hand, and Thomas H. Lee Equity Fund VI, L.P., Thomas H. Lee Parallel Fund VI, L.P. and Thomas H. Lee Parallel

  

 -2- 

 
(DT) Fund VI, L.P., on the other hand, and (ii) the Investment Agreement, dated as of May 25, 2010, between the Company and Warburg Pincus Private Equity X, L.P., in each case, as
amended or amended and restated from time to time in accordance with the terms of the Exchange Agreement. 
 “Issue
Date” means the date set forth in Item 3 of Schedule A hereto. 
 “Market Price”
means, with respect to the Common Stock, on any given date, the average VWAP for the 5 consecutive trading day-period ending on the Trading Day immediately preceding such given date. “Market Price” shall be determined without reference to
after hours or extended hours trading. If the Common Stock is not listed and traded in a manner that the quotations referred to above are available for the period required hereunder, the Market Price per share of Common Stock shall be deemed to be
(i) in the event that any portion of the Warrant is held by the Original Warrantholder, the fair market value per share of the Common Stock as determined in good faith by the Original Warrantholder or (ii) in all other circumstances, the
fair market value per share of the Common Stock as determined in good faith by the Board of Directors in reliance on an opinion of a nationally recognized independent investment banking corporation retained by the Company for this purpose and
certified in a resolution to the Warrantholder. For the purposes of determining the Market Price of the Common Stock on the “trading day” preceding, on or following the occurrence of an event, (i) that trading day shall be deemed to
commence immediately after the regular scheduled closing time of trading on the New York Stock Exchange or, if trading is closed at an earlier time, such earlier time and (ii) that trading day shall end at the next regular scheduled closing
time, or if trading is closed at an earlier time, such earlier time (for the avoidance of doubt, and as an example, if the Market Price is to be determined as of the last trading day preceding a specified event and the closing time of trading on a
particular day is 4:00 p.m. and the specified event occurs at 5:00 p.m. on that day, the Market Price would be determined by reference to such 4:00 p.m. closing time). 

“Ordinary Cash Dividends” means a regular quarterly cash dividend on shares of Common Stock out of surplus or net
profits legally available therefor (determined in accordance with generally accepted accounting principles in effect from time to time), provided that Ordinary Cash Dividends shall not include any cash dividends paid subsequent to the Issue Date to
the extent the aggregate per share dividends paid on the outstanding Common Stock in any quarter exceed the amount set forth in Item 4 of Schedule A hereto, as adjusted for any stock split, stock dividend, reverse stock split,
reclassification or similar transaction. 
 “Original Warrant” has the meaning set forth in Section 15.

 “Original Warrantholder” means the United States Department of the Treasury and any successor or assign that
is an Affiliate of the United States Department of the Treasury. Any actions specified to be taken by the Original Warrantholder hereunder may only be taken by such Person and not by any other Warrantholder. 

“Permitted Transactions” has the meaning set forth in Section 13(B). 

“Person” has the meaning given to it in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d)(3)
and 14(d)(2) of the Exchange Act. 
  

 -3- 

 “Per Share Fair Market Value” has the meaning set forth in
Section 13(C). 
 “Pro Rata Repurchases” means any purchase of shares of Common Stock by the Company or
any Affiliate thereof pursuant to (A) any tender offer or exchange offer subject to Section 13(e) or 14(e) of the Exchange Act or Regulation 14E promulgated thereunder or (B) any other offer available to substantially all holders of
Common Stock, in the case of both (A) or (B), whether for cash, shares of Capital Stock of the Company, other securities of the Company, evidences of indebtedness of the Company or any other Person or any other property (including, without
limitation, shares of Capital Stock, other securities or evidences of indebtedness of a subsidiary), or any combination thereof, effected while this Warrant is outstanding. The “Effective Date” of a Pro Rata Repurchase shall mean
the date of acceptance of shares of Common Stock for purchase or exchange by the Company under any tender or exchange offer which is a Pro Rata Repurchase or the date of purchase with respect to any Pro Rata Repurchase that is not a tender or
exchange offer. 
 “Regulatory Approvals” with respect to the Warrantholder, means, to the extent applicable
and required to permit the Warrantholder to exercise this Warrant for shares of Common Stock and to own such Common Stock without the Warrantholder being in violation of any applicable law, rule or regulation, including, without limitation, the Bank
Holding Company Act of 1956, as amended, and the Change in Bank Control Act of 1978, as amended, and the receipt of any necessary approvals and authorizations of, filings and registrations with, notifications to, or expiration or termination of any
applicable waiting period under, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and any other applicable laws and the rules and regulations thereunder. 

“SEC” means the U.S. Securities and Exchange Commission. 

“Securities Act” means the Securities Act of 1933, as amended, or any successor statute, and the rules and regulations
promulgated thereunder. 
 “Shares” has the meaning set forth in Section 2. 

“trading day” means (A) if the shares of Common Stock are not traded on any national or regional securities
exchange or association or over-the-counter market, a business day or (B) if the shares of Common Stock are traded on any national or regional securities exchange or association or over-the-counter market, a business day on which such relevant
exchange or quotation system is scheduled to be open for business and on which the shares of Common Stock (i) are not suspended from trading on any national or regional securities exchange or association or over-the-counter market for any
period or periods aggregating one half hour or longer; and (ii) have traded at least once on the national or regional securities exchange or association or over-the-counter market that is the primary market for the trading of the shares of
Common Stock. 
 “U.S. GAAP” means United States generally accepted accounting principles. 

“VWAP” means the volume-weighted average trading price of a share of Common Stock as reported by Bloomberg LP.

  

 -4- 

 “Warrant” means this Amended and Restated Warrant, issued pursuant to the
Exchange Agreement. 
 “Warrantholder” has the meaning set forth in Section 2. 

2. Number of Shares; Exercise Price. This certifies that, for value received, the United States Department of the Treasury and its
successors and assigns (the “Warrantholder”) is entitled, upon the terms and subject to the conditions hereinafter set forth, to acquire from the Company, in whole or in part, after the receipt of all applicable Regulatory
Approvals, if any, up to an aggregate of the number of fully paid and nonassessable shares of Common Stock set forth in Item 5 of Schedule A hereto, at a purchase price per share of Common Stock equal to the Exercise Price. The
number of shares of Common Stock (the “Shares”) and the Exercise Price are subject to adjustment as provided herein, and all references to “Common Stock,” “Shares” and “Exercise Price” herein shall be
deemed to include any such adjustment or series of adjustments. 
 3. Exercise of Warrant; Term. Subject to
Section 2, to the extent permitted by applicable laws and regulations, the right to purchase the Shares represented by this Warrant is exercisable, in whole or in part by the Warrantholder, at any time or from time to time after the execution
and delivery of this Warrant by the Company on the date hereof, but in no event later than 5:00 p.m., New York City time on August 26, 2020 (the “Expiration Time”), by (A) the surrender of this Warrant and Notice of
Exercise, in substantially the form set forth in Annex A attached hereto, duly completed and executed on behalf of the Warrantholder, at the principal executive office of the Company located at the address set forth in Item 6 of
Schedule A hereto (or such other office or agency of the Company in the United States as it may designate by notice in writing to the Warrantholder at the address of the Warrantholder appearing on the books of the Company), and
(B) payment of the Exercise Price for the Shares thereby purchased: 
 (i) by having the Company withhold,
from the shares of Common Stock that would otherwise be delivered to the Warrantholder upon such exercise, shares of Common Stock issuable upon exercise of the Warrant equal in value to the aggregate Exercise Price as to which this Warrant is so
exercised based on the Market Price of the Common Stock on the trading day on which this Warrant is exercised and the Notice of Exercise is delivered to the Company pursuant to this Section 3, or 

(ii) with the consent of both the Company and the Warrantholder, by tendering in cash, by certified or cashier’s
check payable to the order of the Company, or by wire transfer of immediately available funds to an account designated by the Company. 

If the Warrantholder does not exercise this Warrant in its entirety, the Warrantholder will be entitled to receive from the Company
within a reasonable time, and in any event not exceeding three business days, a new warrant in substantially identical form for the purchase of that number of Shares equal to the difference between the number of Shares subject to this Warrant and
the number of Shares as to which this Warrant is so exercised. Notwithstanding anything in this Warrant to the contrary, the Warrantholder hereby acknowledges and agrees that its exercise of this Warrant for Shares is subject to the condition that
the Warrantholder will have first received any applicable Regulatory Approvals. 
  

 -5- 

 4. Issuance of Shares; Authorization; Listing. Certificates for Shares issued upon
exercise of this Warrant will be issued in such name or names as the Warrantholder may designate and will be delivered to such named Person or Persons within a reasonable time, not to exceed three business days after the date on which this Warrant
has been duly exercised in accordance with the terms of this Warrant. The Company hereby represents and warrants that any Shares issued upon the exercise of this Warrant in accordance with the provisions of Section 3 will be duly and validly
authorized and issued, fully paid and nonassessable and free from all taxes, liens and charges (other than liens or charges created by the Warrantholder, income and franchise taxes incurred in connection with the exercise of the Warrant or taxes in
respect of any transfer occurring contemporaneously therewith). The Company agrees that the Shares so issued will be deemed to have been issued to the Warrantholder as of the close of business on the date on which this Warrant and payment of the
Exercise Price are delivered to the Company in accordance with the terms of this Warrant, notwithstanding that the stock transfer books of the Company may then be closed or certificates representing such Shares may not be actually delivered on such
date. The Company will at all times reserve and keep available, out of its authorized but unissued Common Stock, solely for the purpose of providing for the exercise of this Warrant, the aggregate number of shares of Common Stock then issuable upon
exercise of this Warrant at any time. The Company will (A) procure, at its sole expense, the listing of the Shares issuable upon exercise of this Warrant at any time, subject to issuance or notice of issuance, on all principal stock exchanges
on which the Common Stock is then listed or traded and (B) maintain such listings of such Shares at all times after issuance. The Company will use reasonable best efforts to ensure that the Shares may be issued without violation of any
applicable law or regulation or of any requirement of any securities exchange on which the Shares are listed or traded. 
 5.
No Fractional Shares or Scrip. No fractional Shares or scrip representing fractional Shares shall be issued upon any exercise of this Warrant. In lieu of any fractional Share to which the Warrantholder would otherwise be entitled, the
Warrantholder shall be entitled to receive a cash payment equal to the Market Price of the Common Stock on the last trading day preceding the date of exercise less the pro-rated Exercise Price for such fractional share. 

6. No Rights as Stockholders; Transfer Books. This Warrant does not entitle the Warrantholder to any voting rights or other rights
as a stockholder of the Company prior to the date of exercise hereof. The Company will at no time close its transfer books against transfer of this Warrant in any manner which interferes with the timely exercise of this Warrant. 

7. Charges, Taxes and Expenses. Issuance of certificates for Shares to the Warrantholder upon the exercise of this Warrant shall
be made without charge to the Warrantholder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the Company. 

 

 -6- 

 8. Transfer/Assignment. 

(A) Subject to compliance with clause (B) of this Section 8, this Warrant and all rights hereunder are transferable and
assignable, in whole or in part, upon the books of the Company by the registered holder hereof in person or by duly authorized attorney, and a new warrant shall be made and delivered by the Company, of the same tenor and date as this Warrant but
registered in the name of one or more transferees, upon surrender of this Warrant, duly endorsed, to the office or agency of the Company described in Section 3. All expenses (other than stock transfer taxes) and other charges payable in
connection with the preparation, execution and delivery of the new warrants pursuant to this Section 8 shall be paid by the Company. 

(B) If and for so long as required by the Exchange Agreement, this Warrant shall contain the legend as set forth in Section 5.2(a)
of the Exchange Agreement. 
 9. Exchange and Registry of Warrant. This Warrant is exchangeable, upon the surrender
hereof by the Warrantholder to the Company, for a new warrant or warrants of like tenor and representing the right to purchase the same aggregate number of Shares. The Company shall maintain a registry showing the name and address of the
Warrantholder as the registered holder of this Warrant. This Warrant may be surrendered for exchange or exercise in accordance with its terms, at the office of the Company, and the Company shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry. 
 10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant, and in the case of any such loss, theft or destruction, upon receipt of a bond, indemnity or security reasonably satisfactory to the
Company, or, in the case of any such mutilation, upon surrender and cancellation of this Warrant, the Company shall make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same aggregate number of Shares as provided for in such lost, stolen, destroyed or mutilated Warrant. 

11. Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right
required or granted herein shall not be a business day, then such action may be taken or such right may be exercised on the next succeeding day that is a business day. 

12. Rule 144 Information. The Company covenants that it will use its reasonable best efforts to timely file all reports and other
documents required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations promulgated by the SEC thereunder (or, if the Company is not required to file such reports, it will, upon the request of any
Warrantholder, make publicly available such information as necessary to permit sales pursuant to Rule 144 under the Securities Act), and it will use reasonable best efforts to take such further action as any Warrantholder may reasonably request, in
each case to the extent required from time to time to enable such holder to, if permitted by the terms of this Warrant and the Exchange Agreement, sell this Warrant without registration under the Securities Act within the limitation of the
exemptions provided by (A) Rule 144 under the Securities Act, as such rule may be amended from time to time, or (B) any successor rule or regulation hereafter adopted by the SEC. Upon the written request of any Warrantholder, the Company
will deliver to such Warrantholder a written statement that it has complied with such requirements. 
  

 -7- 

 13. Adjustments and Other Rights. The Exercise Price and the number of Shares
issuable upon exercise of this Warrant shall be subject to adjustment from time to time as follows; provided, that if more than one subsection of this Section 13 is applicable to a single event, the subsection shall be applied that produces the
largest adjustment and no single event shall cause an adjustment under more than one subsection of this Section 13 so as to result in duplication: 

(A) Stock Splits, Subdivisions, Reclassifications or Combinations. If the Company shall (i) declare and pay a dividend or
make a distribution on its Common Stock in shares of Common Stock, (ii) subdivide or reclassify the outstanding shares of Common Stock into a greater number of shares, or (iii) combine or reclassify the outstanding shares of Common Stock
into a smaller number of shares, the number of Shares issuable upon exercise of this Warrant at the time of the record date for such dividend or distribution or the effective date of such subdivision, combination or reclassification shall be
proportionately adjusted so that the Warrantholder after such date shall be entitled to purchase the number of shares of Common Stock which such holder would have owned or been entitled to receive in respect of the shares of Common Stock subject to
this Warrant after such date had this Warrant been exercised immediately prior to such date. In such event, the Exercise Price in effect at the time of the record date for such dividend or distribution or the effective date of such subdivision,
combination or reclassification shall be adjusted to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment and (2) the Exercise Price in effect
immediately prior to the record or effective date, as the case may be, for the dividend, distribution, subdivision, combination or reclassification giving rise to this adjustment by (y) the new number of Shares issuable upon exercise of the
Warrant determined pursuant to the immediately preceding sentence. 
 (B) Certain Issuances of Common Shares or Convertible
Securities. Until the earlier of (i) the date on which the Original Warrantholder no longer holds this Warrant or any portion thereof and (ii) the third anniversary of the Issue Date, if the Company shall issue shares of Common Stock
(or rights or warrants or other securities exercisable or convertible into or exchangeable for shares of Common Stock) (collectively, “convertible securities”, and, such transaction, a “Common Stock Issuance”),
other than in Permitted Transactions (as defined below) or a transaction to which subsection (A) of this Section 13 is applicable, without consideration or at a consideration per share of Common Stock (or having a conversion price per
share of Common Stock) that is less than the then applicable Exercise Price, then: 
 (1) the Exercise Price
shall be adjusted to equal the consideration per share of Common Stock received by the Company in connection with the Common Stock Issuance; and 

(2) the number of Shares issuable upon the exercise of this Warrant immediately prior to the Common Stock Issuance (the
“Initial Number”) shall be increased to the number obtained by multiplying the Initial Number by a fraction (A) the numerator of which shall be the Exercise Price in effect immediately prior to the

  

 -8- 

 
Common Stock Issuance and (B) the denominator of which shall be the consideration per share of Common Stock received by the Company in connection with the Common Stock Issuance. 

For purposes of the foregoing, the aggregate consideration receivable by the Company in connection with a Common Stock Issuance shall be
deemed to be equal to the sum of the net offering price (including the Fair Market Value of any non-cash consideration and after deduction of any related expenses payable to third parties) of all such securities plus the minimum aggregate amount, if
any, payable upon exercise or conversion of any such convertible securities into shares of Common Stock; and “Permitted Transactions” shall mean issuances (i) as consideration for or to fund the acquisition of businesses and/or
related assets at Fair Market Value, (ii) in connection with employee benefit plans and compensation related arrangements in the ordinary course and consistent with past practice approved by the Board of Directors, (iii) in connection with
a public or broadly marketed offering and sale of Common Stock or convertible securities for cash conducted by the Company or its affiliates pursuant to registration under the Securities Act or Rule 144A thereunder on a basis consistent with capital
raising transactions by comparable financial institutions and (iv) in connection with the exercise of preemptive rights on terms existing as of the Issue Date. Any adjustment made pursuant to this Section 13(B) shall become effective
immediately upon the date of such issuance. 
 (C) Other Distributions. In case the Company shall fix a record date for
the making of a distribution to all holders of shares of its Common Stock of securities, evidences of indebtedness, assets, cash, rights or warrants (excluding Ordinary Cash Dividends, dividends of its Common Stock and other dividends or
distributions referred to in Section 13(A)), in each such case, the Exercise Price in effect prior to such record date shall be reduced immediately thereafter to the price determined by multiplying the Exercise Price in effect immediately prior
to the reduction by the quotient of (x) the Market Price of the Common Stock on the last trading day preceding the first date on which the Common Stock trades regular way on the principal national securities exchange on which the Common Stock
is listed or admitted to trading without the right to receive such distribution, minus the amount of cash and/or the Fair Market Value of the securities, evidences of indebtedness, assets, rights or warrants to be so distributed in respect of one
share of Common Stock (such amount and/or Fair Market Value, the “Per Share Fair Market Value”) divided by (y) such Market Price on such date specified in clause (x); such adjustment shall be made successively whenever
such a record date is fixed. In such event, the number of Shares issuable upon the exercise of this Warrant shall be increased to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of
this Warrant before such adjustment, and (2) the Exercise Price in effect immediately prior to the distribution giving rise to this adjustment by (y) the new Exercise Price determined in accordance with the immediately preceding sentence.
In the case of adjustment for a cash dividend that is, or is coincident with, a regular quarterly cash dividend, the Per Share Fair Market Value would be reduced by the per share amount of the portion of the cash dividend that would constitute an
Ordinary Cash Dividend. In the event that such distribution is not so made, the Exercise Price and the number of Shares issuable upon exercise of this Warrant then in effect shall be readjusted, effective as of the date when the Board of Directors
determines not to distribute such shares, evidences of indebtedness, assets, rights, cash or warrants, as the case may be, to the Exercise Price that would then be in effect and the number of Shares that would then be issuable upon exercise of this
Warrant if such record date had not been fixed. 
  

 -9- 

 (D) Certain Repurchases of Common Stock. In case the Company effects a Pro Rata
Repurchase of Common Stock, then the Exercise Price shall be reduced to the price determined by multiplying the Exercise Price in effect immediately prior to the Effective Date of such Pro Rata Repurchase by a fraction of which the numerator shall
be (i) the product of (x) the number of shares of Common Stock outstanding immediately before such Pro Rata Repurchase and (y) the Market Price of a share of Common Stock on the trading day immediately preceding the first public
announcement by the Company or any of its Affiliates of the intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase price of the Pro Rata Repurchase, and of which the denominator shall be the product of (a) the number
of shares of Common Stock outstanding immediately prior to such Pro Rata Repurchase minus the number of shares of Common Stock so repurchased and (b) the Market Price per share of Common Stock on the trading day immediately preceding the first
public announcement by the Company or any of its Affiliates of the intent to effect such Pro Rata Repurchase. In such event, the number of shares of Common Stock issuable upon the exercise of this Warrant shall be increased to the number obtained by
dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment, and (2) the Exercise Price in effect immediately prior to the Pro Rata Repurchase giving rise to this adjustment
by (y) the new Exercise Price determined in accordance with the immediately preceding sentence. For the avoidance of doubt, no increase to the Exercise Price or decrease in the number of Shares issuable upon exercise of this Warrant shall be
made pursuant to this Section 13(D). 
 (E) Business Combinations. In case of any Business Combination or
reclassification of Common Stock (other than a reclassification of Common Stock referred to in Section 13(A)), the Warrantholder’s right to receive Shares upon exercise of this Warrant shall be converted into the right to exercise this
Warrant to acquire the number of shares of stock or other securities or property (including cash) which the Common Stock issuable (at the time of such Business Combination or reclassification) upon exercise of this Warrant immediately prior to such
Business Combination or reclassification would have been entitled to receive upon consummation of such Business Combination or reclassification; and in any such case, if necessary, the provisions set forth herein with respect to the rights and
interests thereafter of the Warrantholder shall be appropriately adjusted so as to be applicable, as nearly as may reasonably be, to the Warrantholder’s right to exercise this Warrant in exchange for any shares of stock or other securities or
property pursuant to this paragraph. In determining the kind and amount of stock, securities or the property receivable upon exercise of this Warrant following the consummation of such Business Combination, if the holders of Common Stock have the
right to elect the kind or amount of consideration receivable upon consummation of such Business Combination, then the consideration that the Warrantholder shall be entitled to receive upon exercise shall be deemed to be the types and amounts of
consideration received by the majority of all holders of the shares of common stock that affirmatively make an election (or of all such holders if none make an election). 

(F) Rounding of Calculations; Minimum Adjustments. All calculations under this Section 13 shall be made to the nearest
one-tenth (1/10th) of a cent or to the nearest one-hundredth (1/100th) of a share, as the case may be. Any provision of this Section 13 to the contrary notwithstanding, no adjustment in the Exercise Price or the number of Shares into
which this Warrant is exercisable shall be made if the amount of such adjustment would be less than $0.01 or one-tenth (1/10th) of a share of Common Stock, but any such amount shall be 

 

 -10- 

 
carried forward and an adjustment with respect thereto shall be made at the time of and together with any subsequent adjustment which, together with such amount and any other amount or amounts so
carried forward, shall aggregate $0.01 or 1/10th of a share of Common Stock, or more. 
 (G) Timing of Issuance of Additional
Common Stock upon Certain Adjustments. In any case in which the provisions of this Section 13 shall require that an adjustment shall become effective immediately after a record date for an event, the Company may defer until the occurrence
of such event (i) issuing to the Warrantholder of this Warrant exercised after such record date and before the occurrence of such event the additional shares of Common Stock issuable upon such exercise by reason of the adjustment required by
such event over and above the shares of Common Stock issuable upon such exercise before giving effect to such adjustment and (ii) paying to such Warrantholder any amount of cash in lieu of a fractional share of Common Stock; provided, however,
that the Company upon request shall deliver to such Warrantholder a due bill or other appropriate instrument evidencing such Warrantholder’s right to receive such additional shares, and such cash, upon the occurrence of the event requiring such
adjustment. 
 (H) Other Events. For so long as the Original Warrantholder holds this Warrant or any portion thereof, if
any event occurs as to which the provisions of this Section 13 are not strictly applicable or, if strictly applicable, would not, in the good faith judgment of the Board of Directors of the Company, fairly and adequately protect the purchase
rights of the Warrants in accordance with the essential intent and principles of such provisions, then the Board of Directors shall make such adjustments in the application of such provisions, in accordance with such essential intent and principles,
as shall be reasonably necessary, in the good faith opinion of the Board of Directors, to protect such purchase rights as aforesaid. The Exercise Price or the number of Shares into which this Warrant is exercisable shall not be adjusted in the event
of a change in the par value of the Common Stock or a change in the jurisdiction of incorporation of the Company. 
 (I)
Statement Regarding Adjustments. Whenever the Exercise Price or the number of Shares into which this Warrant is exercisable shall be adjusted as provided in Section 13, the Company shall forthwith file at the principal office of the
Company a statement showing in reasonable detail the facts requiring such adjustment and the Exercise Price that shall be in effect and the number of Shares into which this Warrant shall be exercisable after such adjustment, and the Company shall
also cause a copy of such statement to be sent by mail, first class postage prepaid, to each Warrantholder at the address appearing in the Company’s records. 

(J) Notice of Adjustment Event. In the event that the Company shall propose to take any action of the type described in this
Section 13 (but only if the action of the type described in this Section 13 would result in an adjustment in the Exercise Price or the number of Shares into which this Warrant is exercisable or a change in the type of securities or
property to be delivered upon exercise of this Warrant), the Company shall give notice to the Warrantholder, in the manner set forth in Section 13(I), which notice shall specify the record date, if any, with respect to any such action and the
approximate date on which such action is to take place. Such notice shall also set forth the facts with respect thereto as shall be reasonably necessary to indicate the effect on the Exercise Price and the number, kind or class of shares or other
securities or property 
  

 -11- 

 
which shall be deliverable upon exercise of this Warrant. In the case of any action which would require the fixing of a record date, such notice shall be given at least 10 days prior to the date
so fixed, and in case of all other action, such notice shall be given at least 15 days prior to the taking of such proposed action. Failure to give such notice, or any defect therein, shall not affect the legality or validity of any such action.

 (K) Proceedings Prior to Any Action Requiring Adjustment. As a condition precedent to the taking of any action which
would require an adjustment pursuant to this Section 13, the Company shall take any action which may be necessary, including obtaining regulatory, New York Stock Exchange, NASDAQ Stock Market or other applicable national securities exchange or
stockholder approvals or exemptions, in order that the Company may thereafter validly and legally issue as fully paid and nonassessable all shares of Common Stock that the Warrantholder is entitled to receive upon exercise of this Warrant pursuant
to this Section 13. 
 (L) Adjustment Rules. Any adjustments pursuant to this Section 13 shall be made
successively whenever an event referred to herein shall occur. 
 (M) Other Transactions. Notwithstanding anything to the
contrary herein, for the avoidance of doubt, the Exercise Price and the number of Shares issuable upon exercise of this Warrant shall not be subject to adjustment pursuant to this Section 13 as a result of the consummation of the transactions
contemplated by the Investment Agreements or the Other Private Placements (as defined in the Investment Agreements) (including, for the avoidance of doubt, the conversion of the Company’s Series B Shares and Series D Shares (in each case, as
defined in the Investment Agreements) in accordance with their respective terms). 
 14. Exchange. At any time following
the date on which the shares of Common Stock of the Company are no longer listed or admitted to trading on a national securities exchange (other than in connection with any Business Combination), the Original Warrantholder may cause the Company to
exchange all or a portion of this Warrant for an economic interest or security (to be determined by the Original Warrantholder after consultation with the Company) of the Company classified as permanent equity under U.S. GAAP having a value equal to
the Fair Market Value of the portion of the Warrant so exchanged. The Original Warrantholder shall calculate any Fair Market Value required to be calculated pursuant to this Section 14, which shall not be subject to the Appraisal Procedure.

 15. Effect of Execution. This Warrant and the terms and conditions set forth herein hereby amend and restate the terms
and conditions of that certain warrant arising under that certain Securities Purchase Agreement – Standard Terms incorporated into the Letter Agreement, dated as of December 5, 2008, as amended from time to time, between the Company and
the Original Warrantholder (the “Original Warrant”), and the Original Warrant shall have no further force or effect as of and following the Issue Date. 

16. No Impairment. The Company will not, by amendment of its Charter or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in

  

 -12- 

 
good faith assist in the carrying out of all the provisions of this Warrant and in taking of all such action as may be necessary or appropriate in order to protect the rights of the
Warrantholder. 
 17. Governing Law, etc. This Warrant and any claim, controversy or dispute arising under or related to
this Agreement, the relationship of the parties, and/or the interpretation and enforcement of the rights and duties of the parties shall be enforced, governed and construed in all respects (whether in contract or in tort) 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 Company and the
Warrantholder agrees (a) to submit to the exclusive jurisdiction and venue of the United States District Court for the District of Columbia for any civil action, suit or proceeding arising out of or relating to this Warrant or the transactions
contemplated hereby, and (b) that notice may be served upon the Company at the address in Section 21 below and upon the Warrantholder at the address for the Warrantholder set forth in the registry maintained by the Company pursuant to
Section 9 hereof. To the extent permitted by applicable law, each of the Company and the Warrantholder hereby unconditionally waives trial by jury in any civil legal action or proceeding relating to the Warrant or the transactions contemplated
hereby or thereby. 
 18. Binding Effect. This Warrant shall be binding upon any successors or assigns of the Company.

 19. Amendments. This Warrant may be amended and the observance of any term of this Warrant may be waived only with the
written consent of the Company and the Warrantholder. 
 20. Prohibited Actions. The Company agrees that it will not take
any action which would entitle the Warrantholder to an adjustment of the Exercise Price if the total number of shares of Common Stock issuable after such action upon exercise of this Warrant, together with all shares of Common Stock then outstanding
and all shares of Common Stock then issuable upon the exercise of all outstanding options, warrants, conversion and other rights, would exceed the total number of shares of Common Stock then authorized by its Charter. 

21. 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 hereunder shall be delivered as set forth in Item 7 of Schedule A hereto, or pursuant to such other instructions as may be designated in writing by the party to receive such notice. 

22. Entire Agreement. This Warrant, the forms attached hereto and Schedule A hereto (the terms of which are incorporated by
reference herein), and the Exchange Agreement (including all documents incorporated therein), contain the entire agreement between the parties with respect to the subject matter hereof and supersede all prior and contemporaneous arrangements or
undertakings with respect thereto. 
  

 -13- 

 [Remainder of page intentionally left blank] 

 

 -14- 

 IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by a duly authorized
officer. 
 Dated as of the date set forth above. 

			
	COMPANY: Sterling Financial Corporation
		
	By:	 	 
		 	Name:
		 	Title:

			
	Attest:
		
	By:	 	 
		 	Name:
		 	Title:

 [Signature Page to Warrant] 

 ANNEX A 

Form of Notice of Exercise 

Date: [            ] 

TO:  Sterling Financial Corporation 

RE:  Election to Purchase Common Stock 

The undersigned, pursuant to the provisions set forth in the attached Warrant, hereby agrees to subscribe for and purchase the number of
shares of the Common Stock set forth below covered by such Warrant. The undersigned, in accordance with Section 3 of the Warrant, hereby agrees to pay the aggregate Exercise Price for such shares of Common Stock in the manner set forth below. A
new warrant evidencing the remaining shares of Common Stock covered by such Warrant, but not yet subscribed for and purchased, if any, should be issued in the name set forth below. 

Number of Shares of Common Stock 
 Method of
Payment of Exercise Price (note if cashless exercise pursuant to Section 3(i) of the Warrant or cash exercise pursuant to Section 3(ii) of the Warrant, with consent of the Company and the Warrantholder):
                                 

Aggregate Exercise Price:
                                 

 

			
	Holder:	 	  

	By:	 	  

	Name:	 	  

	Title:	 	  

 

 Annex A-1 

 SCHEDULE A 

Item 1 
 Name: Sterling Financial
Corporation 
 Corporate or other organizational form: Corporation 

Jurisdiction of organization: Washington 

Item 2 
 Exercise Price: the lesser
of (x) $0.20 and (y) the lowest price per share of Common Stock on an as converted basis sold in any of the Other Private Placements (as defined in the Investment Agreements) 

Item 3 
 Issue Date: August 26,
2010 
 Item 4 
 Amount of
last dividend declared prior to the Issue Date: $0.10 per quarter 
 Item 5 

Number of shares of Common Stock: 6,437,677 

Item 6 
 Company’s address: 111
N. Wall, Spokane, WA 99201 
 Item 7 
  

			
	Notice information:	 	Sterling Financial Corporation
		 	111 N. Wall
		 	Spokane, WA 99201
		 	Attn: Chief Financial Officer

  

 Sch. A-1

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