Document:

Exhibit No. 4.1

 

	
  NUMBER

  *    01    *

  	
   

  	
  SHARES

  *  7,462  *

  

 

CITIZENS BANCSHARES CORPORATION

INCORPORATED UNDER THE LAWS OF THE STATE OF GEORGIA

 

Transfer of this stock is
restricted in accordance with

conditions printed on the reverse of this certificate.

 

THIS CERTIFIES THAT                 UNITED STATES
DEPARTMENT OF THE TREASURY

 

is
the owner of                      ** SEVEN
THOUSAND FOUR HUNDRED AND SIXTY-TWO **

 

FULLY PAID AND NON-ASSESSABLE SHARES OF

FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK, SERIES B, NO PAR
VALUE, OF

 

CITIZENS BANCSHARES CORPORATION

 

(hereinafter called the “Company”).  The Company will furnish, without charge, a
summary of the designations, relative rights, preferences and limitations
applicable to the Fixed Rate Cumulative Perpetual Preferred Stock, Series B,
of the Company, the variations in rights, preferences and limitations
determined for each series and the authority of the board of directors to
determine variations for future series, upon written request.  The shares represented by this Certificate
are transferable on the books of the Company by said owner or by his or her
duly authorized attorney, upon the surrender of this Certificate properly
endorsed.

 

IN WITNESS WHEREOF, the Company has caused this
Certificate to be signed by its duly authorized officers and its corporate seal
to be hereunto affixed.

 

Date:  August 13, 2010.

 

	
   

  	
   

  	
  [SEAL]

  
	
   

  	
   

  	
   

  
	
  /s/ Cynthia Day

  	
   

  	
  /s/ James E. Young

  
	
  Cynthia Day

  	
   

  	
  James E. Young

  
	
  Secretary

  	
   

  	
  President and Chief Executive Officer

  

 

UST Sequence Number: 318

 

 

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

 

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

 

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

 

THE
FOLLOWING ABBREVIATIONS, WHEN USED IN THE INSCRIPTION ON THE FACE OF THIS
CERTIFICATE, SHALL BE CONSTRUED AS THOUGH THEY WERE WRITTEN OUT IN FULL
ACCORDING TO APPLICABLE LAWS OR REGULATIONS:

 

	
  TEN COM

  	
  -

  	
  AS
  TENANTS IN COMMON

  	
   

  	
  UGMA/(STATE)

  	
   

  	
  CUSTODIAN

  	
   

  
	
  TEN ENT

  	
  -

  	
  AS
  TENANTS BY THE ENTIRETIES

  	
   

  	
   

  	
  (CUSTODIAN)

  	
   

  	
  (MINOR)

  
	
  JTWROS

  	
  -

  	
  AS
  JOINT TENANTS WITH RIGHT OF SURVIVORSHIP AND NOT AS TENANTS IN COMMON

  	
   

  	
   

  UNDER
  THE UNIFORM GIFT TO MINORS ACT/(STATE)

  

 

For
value received,
                                        
hereby sell, assign and transfer unto

 

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

 

 

(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE,
OF ASSIGNEE)

 

Shares

 

represented
by the within Certificate, and do hereby irrevocably constitute and appoint

 

Attorney
to transfer the said shares on the records of the within-named Company with
full power of substitution in the premises.

 

	
   

  	
   

  
	
  (DATE)

  	
   

  

 

 

(SIGNATURE:  THE SIGNATURE ON THIS ASSIGNMENT MUST
CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY
PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.)

 

AND

 

 

(SIGNATURE
GUARANTEE:  SIGNATURE MUST BE GUARANTEED
BY A COMMERCIAL BANK, A SAVINGS AND LOAN ASSOCIATION OR A TRUST COMPANY IN THE
UNITED STATES OR BY A MEMBER FIRM OF ANY NATIONAL SECURITIES EXCHANGE OR OF THE
NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC.)Exhibit No. 10.1

 

UNITED STATES DEPARTMENT OF THE TREASURY

1500 PENNSYLVANIA AVENUE, NW

WASHINGTON, D.C. 20220

 

Dear
Ladies and Gentlemen:

 

The
company set forth on the signature page hereto (the “Company”)
intends to issue the number of shares of a series of its preferred stock set
forth on Schedule A hereto (the “CDCI Preferred Shares”) to the United States Department of
the Treasury (the “Investor”) in
exchange for the number of shares of preferred stock previously acquired by the
Investor pursuant to the Company’s participation in the Troubled Asset Relief
Program Capital Purchase Program set forth on Schedule
A (the “CPP Preferred Shares”).

 

The
purpose of this letter agreement is to confirm the terms and conditions of the
exchange.  Except to the extent
supplemented or superseded by the terms set forth herein or in the Schedules
hereto, the provisions contained in the Exchange Agreement — Standard Terms
attached hereto as Exhibit A (the “Exchange
Agreement”) are incorporated by reference herein.  Terms that are defined in the Exchange
Agreement are used in this letter agreement as so defined.  In the event of any inconsistency between
this letter agreement and the Exchange Agreement, the terms of this letter
agreement shall govern.

 

Each
of the Company and the Investor hereby confirms its agreement with the other
party with respect to the issuance by the Company of the CDCI Preferred Shares
and the exchange of the “Preferred Shares” for the CPP Preferred Shares
pursuant to this letter agreement and the Exchange Agreement on the terms
specified on Schedule A hereto.

 

This
letter agreement (including the Schedules hereto), the Exchange Agreement
(including the Annexes thereto) and the Disclosure Schedules (as defined in the
Exchange Agreement) constitute the entire agreement, and supersede all other
prior agreements, understandings, representations and warranties, both written
and oral, between the parties, with respect to the subject matter hereof.  This letter agreement constitutes the “Letter
Agreement” referred to in the Exchange Agreement.

 

This
letter agreement may be executed in any number of separate counterparts, each
such counterpart being deemed to be an original instrument, and all such
counterparts will together constitute the same agreement.  Executed signature pages to this letter
agreement may be delivered by facsimile and such facsimiles will be deemed as
sufficient as if actual signature pages had been delivered.

 

* * *

 

Letter Agreement                  UST
Sequence Number: 318

 

 

In
witness whereof, this letter agreement has been duly executed and delivered by
the duly authorized representatives of the parties hereto as of the date
written below.

 

	
   

  	
  UNITED
  STATES DEPARTMENT OF THE TREASURY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Herbert M. Allison, Jr.

  
	
   

  	
   

  	
  Name:
  Herbert M. Allison, Jr.

  
	
   

  	
   

  	
  Title:
  Assistant Secretary for Financial Stability

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  CITIZENS
  BANCSHARES CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  James E. Young

  
	
   

  	
   

  	
  James
  E. Young

  
	
   

  	
   

  	
  President
  and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  Date:
  August 13, 2010

  	
   

  
	
   

  	
   

  
	
  Letter
  Agreement Signature Page

  	
  UST Sequence Number: 318

  

 

 

EXHIBIT A

 

Exchange Agreement

 

 

EXHIBIT A

(CDFI Bank/Thrifts

Senior Preferred Stock)

 

EXCHANGE AGREEMENT

 

STANDARD TERMS

 

UST Sequence Number: 318

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  
	
  ARTICLE I

  
	
   

  
	
  THE
  CLOSING; THE EXCHANGE OF CDCI PREFERRED STOCK FOR CPP PREFERRED STOCK

  
	
   

  
	
  Section 1.1

  	
  The CDCI Preferred Stock

  	
  2

  
	
  Section 1.2

  	
  The Closing

  	
  2

  
	
   

  
	
  ARTICLE II

  
	
   

  
	
  EXCHANGE

  
	
   

  
	
  Section 2.1

  	
  Exchange

  	
  5

  
	
  Section 2.2

  	
  Exchange Documentation

  	
  5

  
	
   

  
	
  ARTICLE III

  
	
   

  
	
  REPRESENTATIONS
  AND WARRANTIES OF THE COMPANY

  
	
   

  
	
  Section 3.1

  	
  Existence and Power

  	
  6

  
	
  Section 3.2

  	
  CDCI Preferred Shares

  	
  6

  
	
  Section 3.3

  	
  Community Development Financial Institution Status;
  Domestic Ownership

  	
  7

  
	
  Section 3.4

  	
  Authorization and Enforceability

  	
  7

  
	
  Section 3.5

  	
  Anti-Takeover Provisions and Rights Plan

  	
  8

  
	
  Section 3.6

  	
  No Company Material Adverse Effect

  	
  8

  
	
  Section 3.7

  	
  Company Financial Statements

  	
  8

  
	
  Section 3.8

  	
  No Undisclosed Liabilities

  	
  8

  
	
  Section 3.9

  	
  Offering of Securities

  	
  9

  
	
  Section 3.10

  	
  Litigation and Other Proceedings

  	
  9

  
	
  Section 3.11

  	
  Compliance with Laws

  	
  9

  
	
  Section 3.12

  	
  Employee Benefit Matters

  	
  9

  
	
  Section 3.13

  	
  Taxes

  	
  10

  
	
  Section 3.14

  	
  Properties and Leases

  	
  10

  
	
  Section 3.15

  	
  Environmental Liability

  	
  11

  
	
  Section 3.16

  	
  Risk Management Instruments

  	
  11

  
	
  Section 3.17

  	
  Agreements with Regulatory Agencies

  	
  11

  
	
  Section 3.18

  	
  Insurance

  	
  12

  
	
  Section 3.19

  	
  Intellectual Property

  	
  12

  
	
  Section 3.20

  	
  Brokers and Finders

  	
  12

  

 

i

 

	
  Section 3.21

  	
  Disclosure Schedule

  	
  12

  
	
  Section 3.22

  	
  CPP Preferred Stock

  	
  13

  
	
   

  
	
  ARTICLE IV

  
	
   

  
	
  COVENANTS

  
	
   

  
	
  Section 4.1

  	
  Affirmative Covenants

  	
  13

  
	
  Section 4.2

  	
  Negative Covenants

  	
  19

  
	
   

  
	
  ARTICLE V

  
	
   

  
	
  ADDITIONAL
  AGREEMENTS

  
	
   

  
	
  Section 5.1

  	
  Purchase for Investment

  	
  21

  
	
  Section 5.2

  	
  Legends

  	
  21

  
	
  Section 5.3

  	
  Transfer of CDCI Preferred Shares

  	
  23

  
	
  Section 5.4

  	
  Rule 144; Rule 144A; 4(11⁄2) Transactions

  	
  23

  
	
  Section 5.5

  	
  Depositary Shares

  	
  24

  
	
  Section 5.6

  	
  Expenses and Further Assurances

  	
  24

  
	
   

  
	
  ARTICLE VI

  
	
   

  
	
  MISCELLANEOUS

  
	
   

  
	
  Section 6.1

  	
  Termination

  	
  25

  
	
  Section 6.2

  	
  Survival

  	
  26

  
	
  Section 6.3

  	
  Amendment

  	
  26

  
	
  Section 6.4

  	
  Waiver of Conditions

  	
  26

  
	
  Section 6.5

  	
  Governing Law; Submission to Jurisdiction, etc.

  	
  26

  
	
  Section 6.6

  	
  Notices

  	
  27

  
	
  Section 6.7

  	
  Definitions, Interpretation

  	
  27

  
	
  Section 6.8

  	
  Interpretation

  	
  30

  
	
  Section 6.9

  	
  Assignment

  	
  31

  
	
  Section 6.10

  	
  Severability

  	
  31

  
	
  Section 6.11

  	
  No Third-Party Beneficiaries

  	
  31

  
	
  Section 6.12

  	
  Entire Agreement, etc.

  	
  31

  
	
  Section 6.13

  	
  Specific Performance

  	
  32

  

 

ii

 

LIST OF ANNEXES

 

ANNEX A:  FORM OF OFFICER’S CERTIFICATE

ANNEX B:  FORM OF NEW CERTIFICATE OF DESIGNATIONS

ANNEX C:  FORM OF OPINION

ANNEX D:  FORM OF WAIVER

ANNEX E:  REGISTRATION RIGHTS

ANNEX F:  FORM OF OFFICER’S CERTIFICATE (CDFI
REQUIREMENTS)

 

iii

 

Defined Terms

 

	
  Affiliate

  	
   

  	
  Section 6.7(a)(ii)

  
	
  Agreement

  	
   

  	
  Recitals

  
	
  Appropriate
  Federal Banking Agency

  	
   

  	
  Section 6.7(a)(iii)

  
	
  Bank
  Holding Company

  	
   

  	
  Section 6.7(a)(iv)

  
	
  Bankruptcy
  Exceptions

  	
   

  	
  Section 3.4(a)

  
	
  Benefit
  Plans

  	
   

  	
  Section 1.2(c)(vi)

  
	
  Board
  of Directors

  	
   

  	
  Section 3.5

  
	
  Business
  Combination

  	
   

  	
  Section 6.7(a)(v)

  
	
  Capitalization
  Date

  	
   

  	
  Section 3.1(b)

  
	
  CDCI

  	
   

  	
  Recitals

  
	
  CDCI
  Preferred Shares

  	
   

  	
  Recitals

  
	
  CDCI
  Preferred Stock

  	
   

  	
  Recitals

  
	
  CDFI

  	
   

  	
  Section 3.3

  
	
  CDFI
  Application

  	
   

  	
  Section 1.2(c)(xii)

  
	
  CDFI
  Application Update

  	
   

  	
  Section 1.2(c)(xii)

  
	
  Certified
  Entity

  	
   

  	
  Section 6.7
  (a)(vi)

  
	
  Charter

  	
   

  	
  Section 1.2(c)(iv)

  
	
  Closing

  	
   

  	
  Section 1.2(a)

  
	
  Closing
  Date

  	
   

  	
  Section 1.2(a)

  
	
  Code

  	
   

  	
  Section 3.12

  
	
  Common
  Stock

  	
   

  	
  Section 3.1(b)

  
	
  Company

  	
   

  	
  Recitals

  
	
  Company
  Financial Statements

  	
   

  	
  Section 6.7(a)(vii)

  
	
  Company
  Material Adverse Effect

  	
   

  	
  Section 6.7(a)(viii)

  
	
  Company
  Subsidiaries

  	
   

  	
  Section 3.4(b)

  
	
  Compensation
  Regulations

  	
   

  	
  Section 1.2(c)(vi)

  
	
  Controlled
  Group

  	
   

  	
  Section 3.12

  
	
  CPP

  	
   

  	
  Recitals

  
	
  CPP
  Preferred Shares

  	
   

  	
  Recitals

  
	
  CPP
  Preferred Stock

  	
   

  	
  Recitals

  
	
  CPP
  Securities

  	
   

  	
  Section 6.12(b)

  
	
  CPP
  Securities Purchase Agreement

  	
   

  	
  Recitals

  
	
  CPP
  Signing Date

  	
   

  	
  Recitals

  
	
  CPP
  Waiver

  	
   

  	
  Section 1.2(c)(vii)

  
	
  Designated
  Matters

  	
   

  	
  Section 6.7(a)(ix)

  
	
  Development
  Services

  	
   

  	
  Section 4.1(d)(i)

  
	
  Disclosure
  Schedule

  	
   

  	
  Section 6.7(a)(x)

  
	
  Disclosure
  Update

  	
   

  	
  Section 1.2(c)(xi)

  
	
  EAWA

  	
   

  	
  Section 6.7(a)(xi)

  
	
  EESA

  	
   

  	
  Section 1.2(c)(vi)

  
	
  ERISA

  	
   

  	
  Section 3.12

  
	
  Exchange

  	
   

  	
  Recitals

  
	
  Exchange
  Act

  	
   

  	
  Section 5.3

  

 

iv

 

	
  Federal
  Reserve

  	
   

  	
  Section 6.7(a)(iv)

  
	
  Financial
  Products

  	
   

  	
  Section 4.1(d)(i)

  
	
  Fund

  	
   

  	
  Section 1.2(c)(xii)

  
	
  Governmental
  Entities

  	
   

  	
  Section 1.2(c)

  
	
  Holder

  	
   

  	
  Section 5.4

  
	
  Indemnitee

  	
   

  	
  Section 5.4(b)

  
	
  Information

  	
   

  	
  Section 4.1(c)(iii)

  
	
  Investment
  Area

  	
   

  	
  Section 4.1(d)(i)

  
	
  Investor

  	
   

  	
  Recitals

  
	
  Junior
  Stock

  	
   

  	
  Section 6.7(a)(xii)

  
	
  Letter
  Agreement

  	
   

  	
  Recitals

  
	
  MHA

  	
   

  	
  Section 4.1(i)

  
	
  New
  Certificate of Designations

  	
   

  	
  Section 1.2(c)(iv)

  
	
  Parity
  Stock

  	
   

  	
  Section 6.7(a)(xiii)

  
	
  Plan

  	
   

  	
  Section 3.12

  
	
  Previously
  Disclosed

  	
   

  	
  Section 6.7(a)(xiv)

  
	
  Proprietary
  Rights

  	
   

  	
  Section 3.19

  
	
  Regulatory
  Agreement

  	
   

  	
  Section 3.17

  
	
  Relevant
  Period

  	
   

  	
  Section 1.2(c)(vi)

  
	
  Savings
  and Loan Holding Company

  	
   

  	
  Section 6.7(a)(xv)

  
	
  Schedules

  	
   

  	
  Recitals

  
	
  SEC

  	
   

  	
  Section 3.9

  
	
  Section 4.1(e) Employee

  	
   

  	
  Section 4.1(e)(ii)

  
	
  Securities
  Act

  	
   

  	
  Section 3.1(a)

  
	
  Senior
  Executive Officers

  	
   

  	
  Section 6.7(a)(xvi)

  
	
  Share
  Dilution Amount

  	
   

  	
  Section 6.7(a)(xvii)

  
	
  Signing
  Date

  	
   

  	
  Section 1.2(c)(xi)

  
	
  subsidiary

  	
   

  	
  Section 6.7(a)(i)

  
	
  Target
  Market

  	
   

  	
  Section 4.1(d)(i)

  
	
  Targeted
  Populations

  	
   

  	
  Section 4.1(d)(i)

  
	
  Tax

  	
   

  	
  Section 6.7(xviii)

  
	
  Transfer

  	
   

  	
  Section 5.3

  

 

v

 

EXCHANGE AGREEMENT — STANDARD TERMS

 

Recitals:

 

WHEREAS, the United States Department of the Treasury (the “Investor”) has purchased shares of preferred stock or has
acquired shares of preferred stock through the exercise of warrants or the
exchange of other securities (collectively, the “CPP Preferred Stock”)
from eligible financial institutions which elected to participate in the
Troubled Asset Relief Program Capital Purchase Program (“CPP”);

 

WHEREAS, the Investor may from time to time agree to
exchange the shares of CPP Preferred Stock it received from eligible financial
institutions that participated in CPP for newly issued shares of preferred
stock (“CDCI Preferred Stock”) from such eligible financial institutions
to the extent they elect to participate in the Community Development Capital
Initiative (“CDCI”);

 

WHEREAS, an eligible financial institution electing to
participate in the CDCI  and exchange CPP
Preferred Stock for CDCI Preferred Stock shall enter into a letter agreement
(the “Letter Agreement”) with the Investor
which incorporates this Exchange Agreement — Standard Terms (the eligible
financial institution identified in the Letter Agreement, the “Company”);

 

WHEREAS, the Company issued the CPP Preferred Stock (or
warrants exercised to acquire the CPP Preferred Stock or the securities
exchanged for the CPP Preferred Stock) pursuant to that certain Securities
Purchase Agreement — Standard Terms incorporated into a letter agreement, dated
as of the date set forth on Schedule A to the Letter Agreement (the
“CPP Signing Date”), as amended from time to time, between the Company
and the Investor (the “CPP Securities Purchase Agreement”);

 

WHEREAS, the Company agrees to support the availability of
credit and financial services to underserved populations and communities in the
United States to promote the expansion of small businesses and the creation of
jobs in such populations and communities;

 

WHEREAS, the Company agrees to work diligently, under
existing and any future programs, to modify the terms of residential mortgages
as appropriate to strengthen the health of the U.S. housing market;

 

WHEREAS, the Company intends to issue the number of shares
of the series of its CDCI Preferred Stock set forth on Schedule A
to the Letter Agreement (the “CDCI Preferred Shares”)
to the Investor in exchange for (the “Exchange”) the
number of shares of the CPP Preferred Stock set forth on Schedule A
to the Letter Agreement (the “CPP Preferred Shares”); and

 

1

 

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

 

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

 

ARTICLE I

 

THE CLOSING; THE EXCHANGE OF CDCI
PREFERRED STOCK FOR CPP PREFERRED STOCK

 

Section 1.1.           The CDCI Preferred Stock.  The CDCI Preferred Shares are being issued to
the Investor in the Exchange pursuant to Article II hereof.  The CPP Preferred Shares exchanged for the
CDCI Preferred Shares pursuant to Article II hereof are being reacquired
by the Company and shall have the status of authorized but unissued shares of
preferred stock of the Company undesignated as to series and may be designated
or redesignated and issued or reissued, as the case may be, as part of any
series of preferred stock of the Company; provided that
such shares shall not be reissued as shares of CPP Preferred Stock.

 

Section 1.2            The Closing.  (a) On the terms and subject to the
conditions set forth in this Agreement, the closing of the Exchange (the “Closing”) will take place at the location specified in Schedule A,
at the time and on the date set forth in Schedule A or as soon as
practicable thereafter, or at such other place, time and date as shall be
agreed between the Company and the Investor. 
The time and date on which the Closing occurs is referred to in this
Agreement as the “Closing Date”.

 

(b)           Subject to the fulfillment or waiver of the conditions to
the Closing in this Section 1.2, at the Closing (i) the Company will
deliver the CDCI Preferred Shares to the Investor, as evidenced by one or more
certificates dated the Closing Date and registered in the name of the Investor
or its designee(s) and (ii) the Investor will deliver the certificate
representing the CPP Preferred Shares to the Company.

 

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

 

(i)       (A) any approvals or authorizations of all United States
and other governmental, regulatory or judicial authorities (collectively, “Governmental Entities”) required for the consummation of the
Exchange shall have been obtained or made in form and substance reasonably
satisfactory to each party and shall be in full force and effect and all waiting
periods required by United States and other applicable law, if any, shall

 

2

 

have expired and (B) no
provision of any applicable United States or other law and no judgment,
injunction, order or decree of any Governmental Entity shall prohibit
consummation of the Exchange as contemplated by this Agreement;

 

(ii)      (A) the representations and warranties of the Company set
forth in Article III of this Agreement shall be true and correct in
all respects as though made on and as of the Closing Date (other than
representations and warranties that by their terms speak as of another date,
which representations and warranties shall be true and correct in all respects
as of such other date) and (B) the Company shall have performed in all
respects all obligations required to be performed by it under this Agreement at
or prior to the Closing;

 

(iii)     the Company shall have delivered to the Investor a certificate
signed on behalf of the Company by a Senior Executive Officer certifying to the
effect that the conditions set forth in Section 1.2(c)(ii) have been
satisfied, in substantially the form attached hereto as Annex A;

 

(iv)    the Company shall have duly adopted and filed with the Secretary
of State of its jurisdiction of organization or other applicable Governmental
Entity an amendment to its certificate or articles of incorporation, articles
of association, or similar organizational document (“Charter”)
in substantially the form attached hereto as Annex B (the “New Certificate of Designations”) and the Company shall have
delivered to the Investor a copy of the filed New Certificate of Designations
with appropriate evidence from the Secretary of State or other applicable
Governmental Entity that the filing has been accepted, or if a filed copy is
unavailable, a certificate signed on behalf of the Company by a Senior
Executive Officer certifying to the effect that the filing of the New
Certificate of Designation has been accepted, in substantially the form
attached hereto as Annex A;

 

(v)     the Company shall have delivered to the Investor, a certificate
signed on behalf of the Company by a Senior Executive Officer certifying to the
effect that the Charter and bylaws of the Company delivered to the Investor
pursuant to the CPP Securities Purchase Agreement remain true, complete and
correct, in substantially the form attached hereto as Annex A; to
the extent that the Charter and bylaws of the Company delivered to the Investor
pursuant to the CPP Securities Purchase Agreement are no longer true, correct
and complete, prior to the Closing Date, the Company shall deliver to Investor
true, complete and correct certified copies of any amendments or supplements to
the Charter or bylaws of the Company or the documentation necessary to make the
Charter or bylaws of the Company delivered to the Investor true, correct and
complete as of the Closing Date;

 

(vi)    (A) the Company shall have effected such changes to its
compensation, bonus, incentive and other benefit plans, arrangements and agreements
(including golden parachute, severance and employment agreements)
(collectively, “Benefit Plans”) with respect to its Senior Executive
Officers and any other employee of the Company or its Affiliates subject to
Section 111 of the Emergency Economic Stabilization Act of 2008, as
amended by the American Recovery and Reinvestment Act of 2009, or otherwise
from

 

3

 

time to time (“EESA”),
as implemented by any guidance, rule or regulation thereunder, as the same
shall be in effect from time to time (collectively, the “Compensation
Regulations”) (and to the extent necessary for such changes to be legally
enforceable, each of its Senior Executive Officers and other employees shall
have duly consented in writing to such changes), as may be necessary, during
the period in which any obligation of the Company arising from financial
assistance under the Troubled Asset Relief Program remains outstanding (such
period, as it may be further described in the Compensation Regulations, the “Relevant
Period”), in order to comply with Section 111 of EESA or the
Compensation Regulations and (B) the Investor shall have received a
certificate signed on behalf of the Company by a Senior Executive Officer
certifying to the effect that the condition set forth in
Section 1.2(c)(vi)(A) has been satisfied, in substantially the form
attached hereto as Annex A;

 

(vii)   the Company shall have delivered to the Investor, a written waiver
from each of the Company’s Senior Executive Officers and any other employee of
the Company required to have delivered a waiver to Investor pursuant to Section 1.2(d)(v) of
the CPP Securities Purchase Agreement (each, a “CPP Waiver”) and, to the
extent that any Senior Executive Officer or any other employee of the Company
or its Affiliates that are subject to Section 111 of EESA did not deliver
a CPP Waiver, the Company shall cause each such Senior Executive Officer or
other employee to have delivered to the Investor a written waiver in the form
attached hereto as Annex D releasing the Investor and the Company
from any claims that such Senior Executive Officer or other employee may
otherwise have as a result of the modification of, or the agreement of the
Company hereunder to modify, the terms of any Benefit Plans with respect to its
Senior Executive Officers or other employees to eliminate any provisions of
such Benefit Plans that would not be in compliance with the requirements of
Section 111 of EESA as implemented by the Compensation Regulations;

 

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

 

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

 

(x)      the Company and the Company Subsidiaries shall have taken all
necessary action to ensure that the Company and the Company Subsidiaries and
their executive officers, respectively, are in compliance with (i) all
guidelines put forth by the Investor with respect to transparency, reporting
and monitoring and (ii) the provisions of EESA and any federal law
respecting EESA, including the Employ American Workers Act (Section 1611
of Division A, Title XVI of the American Recovery and Reinvestment Act of
2009), Public Law No. 111-5, effective as of February 17, 2009, and
all rules, regulations and guidance issued thereunder;

 

(xi)     the Company shall have delivered to the Investor, a copy of the
Disclosure Schedule on or prior to the date of the Letter Agreement (the “Signing
Date”) and, to the

 

4

 

extent that any information
set forth on the Disclosure Schedule needs to be updated or supplemented
to make it true, complete and correct as of the Closing Date, (i) the
Company shall have delivered to the Investor an update to the Disclosure
Schedule (the “Disclosure Update”), setting forth any information
necessary to make the Disclosure Schedule true, correct and complete as of
the Closing Date and (ii) the Investor, in its sole discretion, shall have
approved the Disclosure Update, provided, however, that the delivery and acceptance of the Disclosure
Update shall not limit or affect any rights of or remedies available to the
Investor;

 

(xii)    the Company shall have delivered to the Investor prior to the
Signing Date either (i) a true, complete and correct certified copy of
each CDFI Certification Application that each Certified Entity submitted to the
Community Development Financial Institution Fund (the “Fund”)  in connection with its certification as a
CDFI along with any updates to the CDFI Certification Application necessary to
make it true, complete and correct as of the Signing Date or (ii), to the
extent a copy of the CDFI Certification Application that any Certified Entity
submitted to the Fund in connection with its certification as a CDFI is not
available, a newly completed CDFI Certification Application with respect to
such Certified Entity true, complete and correct as of the Signing Date (the
CDFI Certification Application delivered to the Investor pursuant to this
Section 1.2(c)(xii), the “CDFI Application”), and, to the extent
any information set forth in the CDFI Application is not true, complete and
correct as of the Closing Date, the Company shall have delivered to the
Investor an update to the CDFI Application (the “CDFI Application Update”),
setting forth any information necessary to make the information set forth in
the CDFI Application true, correct and complete as of the Closing Date; and

 

(xiii)                   CPP/CDCI Securities.  The Company shall have paid to Investor all
accrued and unpaid dividends or interest then due on the CPP Preferred Stock.

 

ARTICLES II

 

EXCHANGE

 

Section 2.1            Exchange.  On the terms and subject to the conditions
set forth in this Agreement, the Company agrees to issue the CDCI
Preferred Shares to the Investor in exchange for CPP Preferred Shares, and the Investor agrees to deliver to the Company
the CPP Preferred Shares in exchange for the
CDCI Preferred Shares.

 

Section 2.2            Exchange Documentation.  Settlement of the Exchange will take place on
the Closing Date, at which time the Investor will cause delivery of the CPP
Preferred Shares to the Company or its designated agent and the Company will
cause delivery of the CDCI Preferred Shares to the Investor or its designated
agent.

 

5

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF
THE COMPANY

 

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

 

Section 3.1            Existence and Power.

 

(a)           Organization, Authority and Significant Subsidiaries.  The Company has been duly incorporated and is
validly existing and in good standing under the laws of its jurisdiction of
organization, with the necessary power and authority to own, operate and lease
its properties and to conduct its business in all material respects as it is
being currently conducted, and except as has not, individually or in the
aggregate, had and would not reasonably be expected to have a Company Material
Adverse Effect, has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any business so
as to require such qualification; each Certified Entity (if not the Company)
and each subsidiary of the Company that would be considered a “significant
subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X
under the Securities Act of 1933 (the “Securities Act”), has been duly
organized and is validly existing in good standing under the laws of its
jurisdiction of organization.  The
Charter and bylaws of the Company and each Certified Entity (if not the
Company), copies of which have been provided to the Investor prior to the
Signing Date, are true, complete and correct copies of such documents as in
full force and effect as of the Signing Date and as of the Closing Date.

 

(b)           Capitalization. 
The authorized capital stock of the Company, and the outstanding capital
stock of the Company (including securities convertible into, or exercisable or
exchangeable for, capital stock of the Company) as of the most recent fiscal
month-end preceding the Signing Date (the “Capitalization Date”)
is set forth on Schedule B. 
The outstanding shares of capital stock of the Company have been duly
authorized and are validly issued and outstanding, fully paid and
nonassessable, and subject to no preemptive rights (and were not issued in violation
of any preemptive rights).  As of the
Signing Date, the Company does not have outstanding any securities or other
obligations providing the holder the right to acquire common stock of the
Company (“Common Stock”) or other capital stock that is not reserved for
issuance as specified on Schedule B, and the Company has not made
any other commitment to authorize, issue or sell any Common Stock or other
capital stock.  Since the Capitalization
Date, the Company has not issued any shares of Common Stock or other capital
stock other than (i) shares issued upon the exercise of stock options or
delivered under other equity-based awards or other convertible securities or
warrants which were issued and outstanding on the Capitalization Date and
disclosed on Schedule B and (ii) shares disclosed on Schedule B.  Each holder of 5% or more of any class of
capital stock of the Company and such holder’s primary address are set forth on
Schedule B.

 

Section 3.2            CDCI Preferred Shares.  The CDCI Preferred Shares have been duly and
validly authorized by all necessary action, and, when issued and delivered
pursuant to this Agreement, such CDCI Preferred Shares will be duly and validly
issued and fully paid and

 

6

 

nonassessable, will not be issued in violation of
any preemptive rights, and will rank pari passu or
senior to all other series or classes of CDCI Preferred Stock, whether or not
designated, issued or outstanding, with respect to the payment of dividends and
the distribution of assets in the event of any dissolution, liquidation or
winding up of the Company.

 

Section 3.3            Community Development Financial
Institution Status; Domestic Ownership.

 

(a)           The Company, collectively with all of its “Affiliates”
(within the meaning of 12 C.F.R. 1805.104) satisfies the requirements of 12
C.F.R. 1805.200(b).

 

(b)           Each Certified Entity (A) is a regulated community
development financial institution (a “CDFI”) currently certified by the
Fund of the United States Department of the Treasury pursuant to 12 C.F.R.
1805.201(a) as having satisfied the eligibility requirements of the Fund’s
Community Development Financial Institutions Program and (B) satisfies the
eligibility requirements for a CDFI set forth in 12 C.F.R. 1805.201(b)(1) — (6).

 

(c)           The Company is not a Bank Holding Company, Savings and
Loan Holding Company, bank or savings association controlled (within the
meaning of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)(2)) and 12
C.F.R. 225(a)(i) in the case of Bank Holding Companies and banks and the
Home Owners’ Loan Act of 1933 (12 U.S.C. 1467a (a)(2)) and 12 C.F.R. 583.7 in
the case of Savings and Loan Holding Companies and savings associations) by a
foreign bank or company.

 

Section 3.4            Authorization and Enforceability.  (a) The Company has the corporate power
and authority to execute and deliver this Agreement and to carry out its
obligations hereunder (which includes the issuance of the CDCI Preferred
Shares). The execution, delivery and performance by the Company of this
Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate action on the part of the
Company and its stockholders, and no further approval or authorization is
required on the part of the Company. This Agreement is a valid and binding
obligation of the Company enforceable against the Company in accordance with
its terms, subject to any limitations by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of creditors’
rights generally and general equitable principles, regardless of whether such
enforceability is considered in a proceeding at law or in equity (“Bankruptcy
Exceptions”).

 

(b)           The execution, delivery and performance by the Company of
this Agreement and the consummation of the transactions contemplated hereby,
and compliance by the Company with the provisions hereof, will not
(A) violate, conflict with, or result in a breach of any provision of, or
constitute a default (or an event which, with notice or lapse of time or both,
would constitute a default) under, or result in the termination of, or
accelerate the performance required by, or result in a right of termination or
acceleration of, or result in the creation of, any lien, security interest,
charge or encumbrance upon any of the properties or assets of the Company or
any subsidiary of the Company or Certified Entity (if not the Company) (each
subsidiary or Certified Entity, a “Company Subsidiary” and,
collectively, the “Company Subsidiaries”) under any of the terms,
conditions or provisions of (i) its

 

7

 

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

 

(c)           Other than the filing of the New Certificate of
Designations with the Secretary of State of its jurisdiction of organization or
other applicable Governmental Entity, such filings and approvals as are
required to be made or obtained under any state “blue sky” laws and such as
have been made or obtained, no notice to, filing with, exemption or review by,
or authorization, consent or approval of, any Governmental Entity is required
to be made or obtained by the Company in connection with the consummation by
the Company of the Exchange except for any such notices, filings, exemptions,
reviews, authorizations, consents and approvals the failure of which to make or
obtain would not, individually or in the aggregate, reasonably be expected to
have a Company Material Adverse Effect.

 

Section 3.5            Anti-Takeover Provisions and
Rights Plan.  The Board
of Directors of the Company (the “Board of Directors”) has taken all
necessary action to ensure that the transactions contemplated by this Agreement
and the consummation of the transactions contemplated hereby, will be exempt
from any anti-takeover or similar provisions of the Company’s Charter and
bylaws, and any other provisions of any applicable “moratorium”, “control share”,
“fair price”, “interested stockholder” or other anti-takeover laws and
regulations of any jurisdiction.

 

Section 3.6            No Company Material Adverse
Effect.  Since the
CPP Signing Date, no fact, circumstance, event, change, occurrence, condition
or development has occurred that, individually or in the aggregate, has had or
would reasonably be expected to have a Company Material Adverse Effect, except
as disclosed on Schedule C.

 

Section 3.7            Company Financial Statements.  The Company Financial Statements present
fairly in all material respects the consolidated financial position of the
Company and its consolidated subsidiaries as of the dates indicated therein and
the consolidated results of their operations for the periods specified therein;
and except as stated therein, such financial statements (i) were prepared in
conformity with GAAP applied on a consistent basis (except as may be noted
therein) and (ii) have been prepared from, and are in accordance with, the
books and records of the Company and the Company Subsidiaries.

 

Section 3.8            No Undisclosed Liabilities.  Neither the Company nor any of the Company
Subsidiaries has any liabilities or obligations of any nature (absolute,
accrued, contingent or otherwise) which are not properly reflected or reserved
against in the Company Financial Statements to the extent required to be so
reflected or reserved against in accordance with GAAP, except for
(i) liabilities that have arisen since the last fiscal year end in the
ordinary

 

8

 

and usual course of business and consistent with
past practice and (ii) liabilities that, individually or in the aggregate,
have not had and would not reasonably be expected to have a Company Material
Adverse Effect.

 

Section 3.9            Offering of Securities.  Neither the Company nor any person acting on
its behalf has taken any action (including any offering of any securities of
the Company under circumstances which would require the integration of such
offering with the offering of the CDCI Preferred Shares under the Securities
Act and the rules and regulations of the Securities and Exchange
Commission (the “SEC”) promulgated thereunder), which might subject the
issuance or acquisition of the CDCI Preferred Shares to the Investor pursuant
to this Agreement to the registration requirements of the Securities Act.

 

Section 3.10         Litigation and Other Proceedings.  Except (i) as set forth
on Schedule D or (ii) as would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect,
there is no (A) pending or, to the knowledge of the Company, threatened,
claim, action, suit, investigation or proceeding, against the Company or any
Company Subsidiary or to which any of their assets are subject, nor is the
Company or any Company Subsidiary subject to any order, judgment or decree or
(B) unresolved violation, criticism or exception by any Governmental
Entity with respect to any report or relating to any examinations or
inspections of the Company or any Company Subsidiaries.

 

Section 3.11         Compliance with Laws.  Except as would not, individually
or in the aggregate, reasonably be expected to have a Company Material Adverse
Effect, the Company and the Company Subsidiaries have all permits, licenses,
franchises, authorizations, orders and approvals of, and have made all filings,
applications and registrations with, Governmental Entities that are required in
order to permit them to own or lease their properties and assets and to carry
on their business as presently conducted and that are material to the business
of the Company or such Company Subsidiary. 
Except as set forth on Schedule E, the Company and the
Company Subsidiaries have complied in all respects and are not in default or
violation of, and none of them is, to the knowledge of the Company, under
investigation with respect to or, to the knowledge of the Company, have been
threatened to be charged with or given notice of any violation of, any
applicable domestic (federal, state or local) or foreign law, statute,
ordinance, license, rule, regulation, policy or guideline, order, demand, writ,
injunction, decree or judgment of any Governmental Entity, other than such
noncompliance, defaults or violations that would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect.  Except for statutory or regulatory
restrictions of general application or as set forth on Schedule E,
no Governmental Entity has placed any restriction on the business or properties
of the Company or any Company Subsidiary that would, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect.

 

Section 3.12         Employee Benefit Matters.  Except as would not reasonably be expected to
have, either individually or in the aggregate, a Company Material Adverse
Effect: (i) each “employee benefit plan” (within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”)) providing benefits to
any current or former employee, officer or director of the Company or any
member of its “Controlled Group” (defined as any
organization which is a member of a controlled group of corporations within the
meaning of Section 414 of the Internal Revenue Code of 1986, as amended
(the

 

9

 

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

 

Section 3.13         Taxes.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, (i) the Company and the Company Subsidiaries have
filed all federal, state, local and foreign income and franchise Tax returns
(together with any schedules and attached thereto) required to be filed through
the Signing Date, subject to permitted extensions, and have paid all Taxes due
thereon, (ii) all such Tax returns (together with any schedules and
attached thereto) are true, complete and correct in all material respects and
were prepared in compliance with all applicable laws and (iii) no Tax
deficiency has been determined adversely to the Company or any of the Company
Subsidiaries, nor does the Company have any knowledge of any Tax deficiencies.

 

Section 3.14         Properties and Leases.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, the Company and the Company Subsidiaries have good and
marketable title to all real properties and all other properties and assets
owned by them, in each case free from liens (including, without limitation,
liens for Taxes), encumbrances, claims and defects that would affect the value
thereof or interfere with the use made or to be made thereof by them.  Except as would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect,
the Company and the Company Subsidiaries hold all leased real or personal
property under valid and

 

10

 

enforceable
leases with no exceptions that would interfere with the use made or to be made
thereof by them.

 

Section 3.15         Environmental Liability.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect:

 

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

 

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

 

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

 

Section 3.16         Risk Management Instruments.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, all derivative instruments, including, swaps, caps,
floors and option agreements, whether entered into for the Company’s own
account, or for the account of one or more of the Company Subsidiaries or its
or their customers, were entered into (i) only in the ordinary course of
business, (ii) in accordance with prudent practices and in all material
respects with all applicable laws, rules, regulations and regulatory policies
and (iii) with counterparties believed to be financially responsible at
the time; and each of such instruments constitutes the valid and legally
binding obligation of the Company or one of the Company Subsidiaries,
enforceable in accordance with its terms, except as may be limited by the
Bankruptcy Exceptions.  Neither the
Company or the Company Subsidiaries, nor, to the knowledge of the Company, any
other party thereto, is in breach of any of its obligations under any such
agreement or arrangement other than such breaches that would not, individually
or in the aggregate, reasonably be expected to have a Company Material Adverse
Effect.

 

Section 3.17         Agreements with Regulatory Agencies.  Except as set forth on Schedule F,
neither the Company nor any Company Subsidiary is subject to any material
cease-and-desist or other similar order or enforcement action issued by, or is
a party to any material written agreement, consent agreement or memorandum of
understanding with, or is a party to any commitment letter or similar
undertaking to, or is subject to any capital directive by, or since December 31,
2006, has adopted any board resolutions at the request of, any Governmental
Entity that currently restricts in any material respect the conduct of its
business or that in any material manner relates to its capital adequacy, its
liquidity and funding policies and practices, its ability to pay dividends, its
credit, risk management or compliance policies or procedures, its internal
controls, its management or its operations or business (each item in this
sentence, a “Regulatory Agreement”), nor has
the Company or any Company Subsidiary been advised since

 

11

 

December 31, 2006 by any such Governmental
Entity that it is considering issuing, initiating, ordering, or requesting any
such Regulatory Agreement.  The Company
and each Company Subsidiary is in compliance in all material respects with each
Regulatory Agreement to which it is party or subject, and neither the Company
nor any Company Subsidiary has received any notice from any Governmental Entity
indicating that either the Company or any Company Subsidiary is not in
compliance in all material respects with any such Regulatory Agreement.

 

Section 3.18         Insurance.  The Company and the Company
Subsidiaries are insured with reputable insurers against such risks and in such
amounts as the management of the Company reasonably has determined to be
prudent and consistent with industry practice. 
The Company and the Company Subsidiaries are in material compliance with
their insurance policies and are not in default under any of the material terms
thereof, each such policy is outstanding and in full force and effect, all
premiums and other payments due under any material policy have been paid, and
all claims thereunder have been filed in due and timely fashion, except, in
each case, as would not, individually or in the aggregate, reasonably be
expected to have a Company Material Adverse Effect.

 

Section 3.19         Intellectual Property.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, (i) the Company and each Company Subsidiary owns
or otherwise has the right to use, all intellectual property rights, including
all trademarks, trade dress, trade names, service marks, domain names, patents,
inventions, trade secrets, know-how, works of authorship and copyrights
therein, that are used in the conduct of their existing businesses and all
rights relating to the plans, design and specifications of any of its branch
facilities (“Proprietary Rights”) free and
clear of all liens and any claims of ownership by current or former employees,
contractors, designers or others and (ii) neither the Company nor any of
the Company Subsidiaries is materially infringing, diluting, misappropriating
or violating, nor has the Company or any of the Company Subsidiaries received
any written (or, to the knowledge of the Company, oral) communications alleging
that any of them has materially infringed, diluted, misappropriated or
violated, any of the Proprietary Rights owned by any other person.  Except as would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect, to
the Company’s knowledge, no other person is infringing, diluting,
misappropriating or violating, nor has the Company or any or the Company
Subsidiaries sent any written communications since January 1, 2007
alleging that any person has infringed, diluted, misappropriated or violated,
any of the Proprietary Rights owned by the Company and the Company
Subsidiaries.

 

Section 3.20         Brokers and Finders.  The Investor has no liability for any amounts
that any broker, finder or investment banker is entitled to for any financial
advisory, brokerage, finder’s or other fee or commission in connection with
this Agreement or the transactions contemplated hereby based upon arrangements
made by or on behalf of the Company or any Company Subsidiary.

 

Section 3.21         Disclosure Schedule.  The Company has delivered the Disclosure
Schedule and, if applicable, the Disclosure Update to the Investor and the
information contained in the Disclosure Schedule, as modified by the
information contained in the Disclosure Update, if applicable, is true,
complete and correct.

 

12

 

Section 3.22         CPP Preferred Stock.  The Company has (i) not breached any
representation, warranty or covenant set forth in the CPP Securities Purchase
Agreement or any of the other documents governing the CPP Preferred Stock and
(ii) paid to Investor all accrued and unpaid dividends and/or interest
then due on the CPP Preferred Stock.

 

ARTICLE IV

 

COVENANTS

 

Section 4.1            Affirmative Covenants.  The Company hereby covenants and agrees with
Investor that:

 

(a)           Commercially Reasonable Efforts.  Subject to the terms and conditions of this
Agreement, each of the parties will use its commercially reasonable efforts in
good faith to take, or cause to be taken, all actions, and to do, or cause to
be done, all things necessary, proper or desirable, or advisable under
applicable laws, so as to permit consummation of the Exchange as promptly as
practicable and otherwise to enable consummation of the transactions
contemplated hereby and shall use commercially reasonable efforts to cooperate
with the other party to that end.

 

(b)           Certain Notifications Until Closing.  From the Signing Date until the Closing, the
Company shall promptly notify the Investor of (i) any fact, event or
circumstance of which it is aware and which would reasonably be expected to
cause any representation or warranty of the Company contained in this Agreement
to be untrue or inaccurate in any material respect or to cause any covenant or
agreement of the Company contained in this Agreement not to be complied with or
satisfied in any material respect and (ii) except as Previously Disclosed,
any fact, circumstance, event, change, occurrence, condition or development of
which the Company is aware and which, individually or in the aggregate, has had
or would reasonably be expected to have a 
Company Material Adverse Effect; provided, however, that delivery of any notice pursuant to this
Section 4.1(b) shall not limit or affect any rights of or remedies
available to the Investor.

 

(c)           Access, Information and Confidentiality.

 

(i)       From the Signing Date until the date when the Investor owns an
amount of CDCI Preferred Shares having an aggregate liquidation value of less
than 10% of the aggregate liquidation value of the CDCI Preferred Shares as of
the Closing Date, the Company will permit the Investor and its agents,
consultants, contractors and advisors (A) acting through the Appropriate
Federal Banking Agency, or otherwise to the extent necessary to evaluate,
manage, or transfer its investment in the Company, to examine the corporate
books, Tax returns (including all schedules and attached thereto) and other
information reasonably requested by Investor relating to Taxes and make copies
thereof and to discuss the affairs, finances and accounts of the Company and
the Company Subsidiaries with the principal officers of the Company, all upon
reasonable notice and at such reasonable times and as often as the Investor may
reasonably request and (B) to review any information material to the
Investor’s investment in the Company provided by

 

13

 

the Company to its
Appropriate Federal Banking Agency.  Any
investigation pursuant to this Section 4.1(c) shall be conducted
during normal business hours and in such manner as not to interfere
unreasonably with the conduct of the business of the Company, and nothing
herein shall require the Company or any Company Subsidiary to disclose any
information to the Investor to the extent (x) prohibited by applicable law
or regulation, or (y) that such disclosure would reasonably be expected to
cause a violation of any agreement to which the Company or any Company
Subsidiary is a party or would cause a risk of a loss of privilege to the
Company or any Company Subsidiary (provided that
the Company shall use commercially reasonable efforts to make appropriate
substitute disclosure arrangements under circumstances where the restrictions
in this clause (i) apply).

 

(ii)      From the Signing Date until the date on which all of the CDCI
Preferred Shares have been redeemed in whole, the Company will deliver, or will
cause to be delivered, to the Investor:

 

(A)          as soon as available after the end of each fiscal year of
the Company, and in any event within 90 days thereafter, a consolidated balance
sheet of the Company as of the end of such fiscal year, and consolidated
statements of income, retained earnings and cash flows of the Company for such
year, in each case prepared in accordance with GAAP and setting forth in each
case in comparative form the figures for the previous fiscal year of the
Company, and which shall be audited to the extent audited financial statements
are available;

 

(B)          as soon as available after the end of the first, second and
third quarterly periods in each fiscal year of the Company, a copy of any
quarterly reports provided to other stockholders of the Company or Company
management by the Company;

 

(C)          as soon as available after the Company receives any
assessment of the Company’s internal controls, a copy of such assessment;

 

(D)          annually on a date specified by the Investor, a completed
survey, in a form specified by the Investor, providing, among other things, a
description of how the Company has utilized the funds the Company received in
connection with the sale of the CPP Preferred Shares and the effects of such
funds on the operations and status of the Company;

 

(E)           as soon as such items become effective, any amendments to
the Charter, bylaws or other organizational documents of the Company; and

 

(F)           at the same time as such items are sent to any
stockholders of the Company, copies of any information or documents sent by the
Company to its stockholders.

 

(iii)     The Investor will use reasonable best efforts to hold, and will
use reasonable best efforts to cause its agents, consultants, contractors and
advisors and

 

14

 

United States executive
branch officials and employees, to hold, in confidence all non-public records,
books, contracts, instruments, computer data and other data and information
(collectively, “Information”) concerning the
Company furnished or made available to it by the Company or its representatives
pursuant to this Agreement (except to the extent that such information can be
shown to have been (A) previously known by such party on a
non-confidential basis, (B) in the public domain through no fault of such
party or (C) later lawfully acquired from other sources by the party to
which it was furnished (and without violation of any other confidentiality
obligation)); provided that nothing herein
shall prevent the Investor from disclosing any Information to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process.  The Investor understands that
the Information may contain commercially sensitive confidential information
entitled to an exception from a Freedom of Information Act request.

 

(iv)    The Investor’s information rights pursuant to
Section 4.1(c)(ii)(A), (B), (C), (E) and (F) and the Investor’s
right to receive certifications from the Company pursuant to
Section 4.1(d)(ii) may be assigned by the Investor to a transferee or
assignee of the CDCI Preferred Shares with a liquidation preference of no less
than an amount equal to 2% of the initial aggregate liquidation preference of
the CDCI Preferred Shares.

 

(v)     From the Signing Date until the date when the Investor no longer
owns any CDCI Preferred Shares, the Company shall permit, and shall cause each
of the Company’s Subsidiaries to permit (A) the Investor and its agents,
consultants, contractors and advisors, (B) the Special Inspector General
of the Troubled Asset Relief Program, and (C) the Comptroller General of
the United States access to personnel and any books, papers, records or other
data, in each case, to the extent relevant to ascertaining compliance with the
financing terms and conditions; provided that
prior to disclosing any information pursuant to clause (B) or (C),
the Special Inspector General of the Troubled Asset Relief Program and the
Comptroller General of the United States shall have agreed, with respect to
documents obtained under this Agreement in furtherance of its function, to
follow applicable law and regulation (and the applicable customary policies and
procedures) regarding the dissemination of confidential materials, including
redacting confidential information from the public version of its reports and
soliciting the input from the Company as to information that should be afforded
confidentiality, as appropriate.

 

(vi)    Nothing in this Section shall be construed to limit the
authority that the Special Inspector General of the Troubled Asset Relief
Program, the Comptroller General of the United States or any other applicable
regulatory authority has under law.

 

(d)           CDFI Requirements.

 

(i)       From the Signing Date until the date on which all of the CDCI
Preferred Shares have been redeemed in whole, each Certified Entity shall
(A) be certified by the Fund as a CDFI; (B) together with its
Affiliates collectively meet the eligibility requirements of 12 C.F.R.
1805.200(b); (C) have a primary mission of promoting community
development, as may be determined by Investor from time to time, based on

 

15

 

criteria set forth in 12
C.F.R. 1805.201(b)(1); (D) provide Financial Products, Development
Services, and/or other similar financing as a predominant business activity in
arm’s-length transactions; (E) serve a Target Market by serving one or
more Investment Areas and/or Targeted Populations as may be determined by
Investor from time to time, substantially in the manner set forth in 12 C.F.R.
1805.201(b)(3); (F) provide Development Services in conjunction with its
Financial Products, directly, through an Affiliate or through a contract with a
third-party provider; (G) maintain accountability to residents of the
applicable Investment Area(s) or Targeted Population(s) through
representation on its governing Board of Directors or otherwise; and
(H) remain a non-governmental entity which is not an agency or
instrumentality of the United States of America, or any State or political
subdivision thereof, as described in 12 C.F.R. 1805.201(b)(6) and within
the meaning of any supplemental regulations or interpretations of 12 C.F.R.
1805.201(b)(6) or such supplemental regulations published by the
Fund.  Notwithstanding any other
provision hereof, as used in this Section 4.1(d), the terms “Affiliates”;
“Financial Products”; “Development Services”; “Target Market”;
“Investment Areas”; and “Targeted Populations” have the meanings
ascribed to such terms in 12 C.F.R. 1805.104.

 

(ii)      From the Signing Date until the date on which all of the CDCI
Preferred Shares have been redeemed in whole, the Company shall deliver to
Investor (1)(x) on the date that is 180 days after the Closing Date and
(y) annually on the same date on which the Company delivers the documentation
required under Section 4.1(c)(ii)(A) to the Investor, a
certificate signed on behalf of the Company by a Senior Executive Officer, in
substantially the form attached hereto as Annex F, certifying
(A) that the Company and each Certified Entity remains in compliance with
the covenants set forth in Section 4.1(d)(i); (B) that the
information in the CDFI Application, as modified by any updates to the CDFI
Application provided by the Company to the Investor on or prior to the date of
such certificate, with respect to the covenants set forth in
Section 4.1(d)(i)(B) and Section 4.1(d)(i)(D) remains true,
correct and complete as of such date or, to the extent any information set
forth in the CDFI Application, as modified by any updates to the CDFI Application
provided by the Company to the Investor on or prior to the date of such
certificate, with respect to such covenants needs to be updated or supplanted
to make it true, complete and correct as of such date, that an updated
narrative to the CDFI Application setting forth any information necessary to
make the information set forth in the CDFI Application is true, complete and
correct as of such date; (C) either (a) that the contracts and
material agreements entered into by each Certified Entity with respect to
Development Services previously disclosed to the Investor remain in effect or
(b) that attached are any new contracts and material agreements entered
into by the Certified Entity with respect to Development Services; (D) a
list of the names and addresses of the individuals which comprise the board of
directors of each Certified Entity as of such date and, to the extent any of
such individuals was not a member of the board of directors of such Certified
Entity as of the last certification to the Investor, a narrative describing
such individual’s relationship to the applicable Investment Area(s) and
Targeted Population(s) or, if such Certified Entity maintains
accountability to residents of the applicable Investment Area(s) or Target
Population(s) through means other than representation on its governing
board of directors and such means have changed since the date of the last

 

16

 

certification to the
Investor, a narrative describing such change; (E) that each Certified
Entity is not an agency of the United States of America, or any State or
political subdivision thereof, as described in 12 C.F.R. 1805.201(b)(6) and
within the meaning of any supplemental regulations or interpretations of 12
C.F.R. 1805.201(b)(6) or such supplemental regulations published by the
Fund and (F) that the Company remains in compliance with the covenants set
forth in Section 4.1(f) and Section 4.1(l) and
(2) within five (5) business days of receipt, copies of any notices,
correspondence or other written communication between each Certified Entity and
the Fund, including any form that such Certified Entity is required to provide
to the Fund due to the occurrence of a “Material Event” within the meaning of
the Fund’s CDFI Certification Procedures.

 

(iii)     The Company shall immediately notify the Investor upon the
occurrence of any breach of any of the covenants set forth in
Section 4.1(d).

 

(e)           Executive Compensation.

 

(i)       Benefit Plans. 
During the Relevant Period, the Company shall take all necessary action
to ensure that the Benefit Plans of the Company and its Affiliates comply in
all respects with, and shall take all other actions necessary to comply with,
Section 111 of EESA, as implemented by the Compensation Regulations, and
neither the Company nor any of its Affiliates shall adopt any new Benefit Plan
(x) that does not comply therewith or (y) that does not expressly
state and require that such Benefit Plan and any compensation thereunder shall
be subject to any relevant Compensation Regulations adopted, issued or released
on or after the date any such Benefit Plan is adopted. To the extent that EESA
and/or the Compensation Regulations are amended or otherwise change during the
Relevant Period in a manner that requires changes to then-existing Benefit
Plans, or that requires other actions, the Company and its Affiliates shall
effect such changes to its or their Benefit Plans, and take such other actions,
as promptly as practicable after it has actual knowledge of such amendments or
changes in order to be in compliance with this Section 4.1(e) (and
shall be deemed to be in compliance for a reasonable period to effect such
changes).  In addition, the Company and
its Affiliates shall take all necessary action, other than to the extent prohibited
by applicable law or regulation applicable outside of the United States, to
ensure that the consummation of the transactions contemplated by this Agreement
will not accelerate the vesting, payment or distribution of any equity-based
awards, deferred cash awards or any nonqualified deferred compensation payable
by the Company or any of its Affiliates.

 

(ii)      Additional Waivers. 
After the Closing Date, in connection with the hiring or promotion of a
Section 4.1(e) Employee and/or the promulgation of applicable
Compensation Regulations or otherwise, to the extent any Section 4.1(e) Employee
shall not have executed a waiver in a form satisfactory to the Investor with
respect to the application to such Section 4.1(e) Employee of the
Compensation Regulations, the Company shall use its best efforts to
(x) obtain from such Section 4.1(e) Employee a waiver in
substantially the form attached hereto as Annex D and
(y) deliver such waiver to the Investor as promptly as possible, in each
case within sixty days of such Section 4.1(e) Employee becoming
subject to the requirements of this Section.

 

17

 

“Section 4.1(e) Employee”
means (A) each Senior Executive Officer and (B) any other employee of
the Company or any of its Affiliates determined at any time to be subject to
Section 111 of  EESA as implemented
by the Compensation Regulations.

 

(iii)     Clawback.  In the
event that any Section 4.1(e) Employee receives a payment in
contravention of the provisions of this Section 4.1(e), the Company shall
promptly provide such individual with written notice that the amount of such
payment must be repaid to the Company in full within fifteen business days
following receipt of such notice or such earlier time as may be required by the
Compensation Regulations and shall promptly inform the Investor (x) upon
discovering that a payment in contravention of this Section 4.1(e) has
been made and (y) following the repayment to the Company of such amount
and shall take such other actions as may be necessary to comply with the
Compensation Regulations.

 

(iv)    Limitation on Deductions. 
During the Relevant Period, the Company agrees that it shall not claim a
deduction for remuneration for federal income tax purposes in excess of
$500,000 for each Senior Executive Officer that would not be deductible if
Section 162(m)(5) of the Code applied to the Company.

 

(v)     Amendment to Prior Agreement.  The parties agree that, effective as of the
date hereof, Section 4.8 of the CPP Securities Purchase Agreement shall be
amended in its entirety by replacing such Section 4.8 with the provisions
set forth in this Section 4.1(e) and any terms included in this
Section 4.1(e) that are not otherwise defined in the CPP Securities
Purchase Agreement shall have the meanings ascribed to such terms in this
Agreement.

 

(f)            Bank or Savings and Loan Holding Company Status.  If the Company is a Bank Holding Company or a
Savings and Loan Holding Company on the Signing Date, then the Company shall
maintain its status as a Bank Holding Company or Savings and Loan Holding
Company, as the case may be, for as long as the Investor owns any CDCI
Preferred Shares.  The Company shall
redeem all CDCI Preferred Shares held by the Investor prior to terminating its
status as a Bank Holding Company or Savings and Loan Holding Company, as
applicable.

 

(g)           Predominantly Financial.  For as long as the Investor owns any CDCI
Preferred Shares, the Company, to the extent it is not itself an insured
depository institution, agrees to remain predominantly engaged in financial
activities.  A company is predominantly
engaged in financial activities if the annual gross revenues derived by the
company and all subsidiaries of the company (excluding revenues derived from
subsidiary depository institutions), on a consolidated basis, from engaging in
activities that are financial in nature or are incidental to a financial
activity under subsection (k) of Section 4 of the Bank Holding
Company Act of 1956 (12 U.S.C. 1843(k)) represent at least 85 percent of the consolidated
annual gross revenues of the company.

 

(h)           Capital Covenant. 
From the Signing Date until the date on which all of the CDCI Preferred
Shares have been redeemed in whole, the Company and the Company Subsidiaries
shall maintain such capital as may be necessary to meet the minimum capital
requirements of the Appropriate Federal Banking Agency, as in effect from time
to time.

 

18

 

(i)            HAMP Modifications.  The Company shall take all necessary action
to ensure that (i) from and after the date the Company or any Company
Subsidiary that services residential mortgage loans has 100 or more residential
mortgage loans not owned or guaranteed by Fannie Mae or Freddie Mac which have
been past due for 60 or more days, the Company or such Company Subsidiary
shall, to the extent such programs are open for participation,
(A) participate in the United States Department of the Treasury’s Making
Home Affordable (“MHA”) program, including MHA’s Second Lien
Modification Program and, (B) immediately execute a Commitment to Purchase
Financial Instrument and Servicer Participation Agreement (in such form as may
be set forth on the MHA website at www.hmpadmin.com from time to time) with
Fannie Mae (acting as the United States Department of the Treasury’s fiscal
agent) and (ii) if the Company or any Company Subsidiary owns mortgage
loans that are serviced by a non-affiliated mortgage servicer, the Company or
such Company Subsidiary shall consent to any MHA modification request made by
such mortgage servicer.

 

(k)           Reporting Requirements.  Prior to the date on which all of the CDCI
Preferred Shares have been redeemed in whole, the Company covenants and agrees
that, at all times on or after the Closing Date, (i) to the extent it is
subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, it shall comply with the terms and conditions set forth in Annex
E or (ii) as soon as practicable after the date that the Company
becomes subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act, it shall comply with the terms and conditions set forth in Annex
E.

 

(l)            Compliance with Employ American Workers Act.  The Company shall agree to comply, and take
all necessary action to ensure that any Company Subsidiary complies in all
respects with the provisions of EESA and any federal law respecting EESA,
including the Employ American Workers Act (Section 1611 of Division A,
Title XVI of the American Recovery and Reinvestment Act of 2009), Public Law No. 111-5,
effective as of February 17, 2009, as implemented by any rules, regulation
or guidance thereunder, as such may be amended or supplemented from time to
time, and any applicable guidance of the United States Department of the
Treasury with respect thereto.

 

(m)          Control by Foreign Bank or Company.  Prior to the date on which all of the CDCI
Preferred Shares have been redeemed in whole, the Company shall not be
controlled (within the meaning of the Bank Holding Company Act of 1956 (12
U.S.C. 1841(a)(2)) and 12 C.F.R. 225(a)(i) in the case of Bank Holding
Companies and banks and the Home Owners’ Loan Act of 1933 (12 U.S.C. 1467a
(a)(2)) and 12 C.F.R. 583.7 in the case of Savings and Loan Holding Companies
and savings associations) by a foreign bank or company.

 

Section 4.2            Negative Covenants.  The Company hereby covenants and agrees with
the Investor that:

 

(a)           Certain Transactions.

 

(i)       The Company shall not merge or consolidate with, or sell,
transfer or lease all or substantially all of its property or assets to, any
other party unless the successor, transferee or lessee party (or its ultimate
parent entity), as the case may be (if not the Company), expressly assumes the
due and punctual performance and observance of each

 

19

 

and every covenant,
agreement and condition of this Agreement to be performed and observed by the
Company.

 

(ii)      Without the prior written consent of the Investor, until such
time as the Investor shall cease to own any debt or equity securities of the
Company acquired pursuant to this Agreement or the CPP Securities Purchase
Agreement (including, for the avoidance of doubt, the CPP Preferred Shares or
the CDCI Preferred Shares), the Company shall not permit any of its “significant
subsidiaries” (as such term is defined in Rule 12b-2 promulgated under the
Exchange Act) to (i) engage in any merger, consolidation, statutory share
exchange or similar transaction following the consummation of which such
significant subsidiary is not wholly-owned by the Company, (ii) dissolve
or sell all or substantially all of its assets or property other than in
connection with an internal reorganization or consolidation involving
wholly-owned subsidiaries of the Company or (iii) issue or sell any shares
of its capital stock or any securities convertible or exercisable for any such
shares, other than issuances or sales in connection with an internal
reorganization or consolidation involving wholly-owned subsidiaries of the
Company.

 

(b)           Restriction on Dividends and Repurchases.

 

(i)       The Company covenants and agrees that it shall not violate any
of the restrictions on dividends, distributions, redemptions, repurchases,
acquisitions and related actions set forth in the New Certificate of
Designations, which are incorporated by reference herein as if set forth in
full.

 

(ii)      During the period beginning on the eighth anniversary of the
Closing and ending on the date on which the Investor no longer owns any of the
CDCI Preferred Shares, neither the Company nor any Company Subsidiary shall,
without the consent of the Investor, (A) declare or pay any dividend or
make any distribution on capital stock or other equity securities of any kind
of the Company or any Company Subsidiary; or (B) redeem, purchase or
acquire any shares of Common Stock or other capital stock or other equity
securities of any kind of the Company or any Company Subsidiary, or any trust
preferred securities issued by the Company or any Affiliate of the Company,
other than (1) redemptions, purchases or other acquisitions of the CDCI
Preferred Shares, (2) regular dividends on shares of preferred stock in
accordance with the terms thereof and which are permitted under the terms of
the CDCI Preferred Shares, or (3) dividends or distributions by any wholly-owned
Company Subsidiary.

 

(c)           Related Party Transactions.  Until such time as the Investor ceases to own
any debt or equity securities of the Company, including the CDCI Preferred
Shares, the Company and the Company Subsidiaries shall not enter into
transactions with Affiliates or related persons (within the meaning of Item 404
under the SEC’s Regulation S-K) unless (A) such transactions are on terms
no less favorable to the Company and the Company Subsidiaries than could be
obtained from an unaffiliated third party, and (B) have been approved by
the audit committee of the Board of Directors or comparable body of independent
directors of the Company, or if there are no independent directors, the Board
of Directors, provided that the

 

20

 

Board of Directors shall maintain written
documentation which supports its determination that the transaction meets the
requirements of clause (A) of this Section 4.2(c).

 

(d)           Restriction on Repurchase of CDCI Preferred Shares Not
Held by Investor.  Prior to
the date on which the Investor no longer owns any of the CDCI Preferred Shares
the Company shall not repurchase, redeem, call or otherwise reacquire any CDCI
Preferred Shares from any holder thereof, whether by means of open market
purchase, negotiated transaction, or otherwise, unless it offers to repurchase,
redeem, call or otherwise reacquire a ratable portion of the CDCI Preferred
Shares, as the case may be, then held by the Investor on the same terms and
conditions.

 

ARTICLE V

 

ADDITIONAL AGREEMENTS

 

Section 5.1            Purchase for Investment.  The Investor acknowledges that the CDCI
Preferred Shares have not been registered under the Securities Act or under any
state securities laws. The Investor (a) is acquiring the CDCI Preferred
Shares pursuant to an exemption from registration under the Securities Act
solely for investment with no present intention to distribute them to any
person in violation of the Securities Act or any applicable U.S. state
securities laws, (b) will not sell or otherwise dispose of any of the CDCI
Preferred Shares, except in compliance with the registration requirements or
exemption provisions of the Securities Act and any applicable U.S. state
securities laws, and (c) has such knowledge and experience in financial
and business matters and in investments of this type that it is capable of
evaluating the merits and risks of the Exchange and of making an informed
investment decision.

 

Section 5.2            Legends.  (a) The Investor agrees that all
certificates or other instruments representing the CDCI Preferred Shares will
bear a legend substantially to the following effect:

 

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

 

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

 

21

 

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

 

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

 

(b)           In the event that any CDCI Preferred Shares
(i) become registered under the Securities Act or (ii) are eligible
to be transferred without restriction in accordance with Rule 144 or
another exemption from registration under the Securities Act (other than Rule 144A),
the Company shall issue new certificates or other instruments representing such
CDCI Preferred

 

22

 

Shares, which shall not contain the applicable
legends in Section 5.2(a) above; provided that
the Investor surrenders to the Company the previously issued certificates or
other instruments.

 

Section 5.4            Transfer of CDCI Preferred
Shares.  Subject to
compliance with applicable securities laws, the Investor shall be permitted to
transfer, sell, assign or otherwise dispose of (“Transfer”)
all or a portion of the CDCI Preferred Shares at any time, and the Company
shall take all steps as may be reasonably requested by the Investor to
facilitate the Transfer of the CDCI Preferred Shares, including without
limitation, as set forth in Section 5.4, provided that
the Investor shall not Transfer any CDCI Preferred Shares if such transfer
would require the Company to be subject to the periodic reporting requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange
Act”) and the Company was not already subject to such requirements.  In furtherance of the foregoing, the Company
shall provide reasonable cooperation to facilitate any Transfers of the CDCI
Preferred Shares, including, as is reasonable under the circumstances, by
furnishing such information concerning the Company and its business as a
proposed transferee may reasonably request and making management of the Company
reasonably available to respond to questions of a proposed transferee in
accordance with customary practice, subject in all cases to the proposed
transferee agreeing to a customary confidentiality agreement.

 

Section 5.5            Rule 144; Rule 144A;
4(11⁄2) Transactions. 
(a) At all times after the Signing Date, the Company covenants that
(1) it will, upon the request of the Investor or any subsequent holders of
the CDCI Preferred Shares (“Holders”), use
its reasonable best efforts to (x), to the extent any Holder is relying on Rule 144
under the Securities Act to sell any of the CDCI Preferred Shares, make “current
public information” available, as provided in Section (c)(1) of
Rule 144 (if the Company is a “Reporting Issuer” within the meaning of Rule 144)
or in Section (c)(2) of Rule 144 (if the Company is a “Non-Reporting
Issuer” within the meaning of Rule 144), in either case for such time
period as necessary to permit sales pursuant to Rule 144, (y), to the
extent any Holder is relying on the so-called “Section 4(11⁄2)” exemption to
sell any of its CDCI Preferred Shares, prepare and provide to such Holder such
information, including the preparation of private offering memoranda or
circulars or financial information, as the Holder may reasonably request to
enable the sale of the CDCI Preferred Shares pursuant to such exemption, or
(z) to the extent any Holder is relying on Rule 144A under the
Securities Act to sell any of its CDCI Preferred Shares, prepare and provide to
such Holder the information required pursuant to Rule 144A(d)(4), and
(2) it will take such further action as any Holder may reasonably request
from time to time to enable such Holder to sell CDCI Preferred Shares without
registration under the Securities Act within the limitations of the exemptions
provided by (i) the provisions of the Securities Act or any
interpretations thereof or related thereto by the SEC, including transactions
based on the so-called “Section 4(11⁄2)” and other similar transactions,
(ii) Rule 144 or 144A under the Securities Act, as such rules may
be amended from time to time, or (iii) any similar rule or regulation
hereafter adopted by the SEC; provided that the Company shall not be
required to take any action described in this Section 5.4(a) that
would cause the Company to become subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act if the Company was not
subject to such requirements prior to taking such action.  Upon the request of any Holder, the Company
will deliver to such Holder a written statement as to whether it has complied
with such requirements and, if not, the specifics thereof.

 

23

 

(b)           The Company agrees to indemnify Investor, Investor’s
officers, directors, employees, agents, representatives and Affiliates, and
each person, if any, that controls Investor within the meaning of the Securities
Act (each, an “Indemnitee”), against any and all
losses, claims, damages, actions, liabilities, costs and expenses (including
reasonable fees, expenses and disbursements of attorneys and other
professionals incurred in connection with investigating, defending, settling,
compromising or paying any such losses, claims, damages, actions, liabilities,
costs and expenses), joint or several, arising out of or based upon any untrue
statement or alleged untrue statement of material fact contained in any document
or report provided by the Company pursuant to this Section 5.4 or any
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.

 

(c)           If the indemnification provided for in Section 5.4(b) is
unavailable to an Indemnitee with respect to any losses, claims, damages,
actions, liabilities, costs or expenses referred to therein or is insufficient
to hold the Indemnitee harmless as contemplated therein, then the Company, in
lieu of indemnifying such Indemnitee, shall contribute to the amount paid or
payable by such Indemnitee as a result of such losses, claims, damages,
actions, liabilities, costs or expenses in such proportion as is appropriate to
reflect the relative fault of the Indemnitee, on the one hand, and the Company,
on the other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages, actions, liabilities, costs or
expenses as well as any other relevant equitable considerations.  The relative fault of the Company, on the one
hand, and of the Indemnitee, on the other hand, shall be determined by
reference to, among other factors, whether the untrue statement of a material
fact or omission to state a material fact relates to information supplied by
the Company or by the Indemnitee and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission;  the Company and Investor agree
that it would not be just and equitable if contribution pursuant to this
Section 5.4(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in Section 5.4(b).  No Indemnitee guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from the Company if the
Company was not guilty of such fraudulent misrepresentation.

 

Section 5.5            Depositary Shares.  Upon request by the Investor at any time
following the Closing Date, the Company shall promptly enter into a depositary
arrangement, pursuant to customary agreements reasonably satisfactory to the
Investor and with a depositary reasonably acceptable to the Investor, pursuant
to which the CDCI Preferred Shares may be deposited and depositary shares, each
representing a fraction of a CDCI Preferred Share, as specified by the
Investor, may be issued. From and after the execution of any such depositary
arrangement, and the deposit of any CDCI Preferred Shares, as applicable,
pursuant thereto, the depositary shares issued pursuant thereto shall be deemed
“CDCI Preferred Shares” and, as applicable, “Registrable Securities” for
purposes of this Agreement.

 

Section 5.6            Expenses and Further Assurances.  (a) Unless otherwise provided in this
Agreement, each of the parties hereto will bear and pay all costs and expenses
incurred by it or on its behalf in connection with the transactions
contemplated under this

 

24

 

Agreement, including fees and expenses of its own
financial or other consultants, investment bankers, accountants and counsel.

 

(b)           The Company shall, at the Company’s sole cost and expense,
(i) furnish to the Investor all instruments, documents and other
agreements required to be furnished by the Company pursuant to the terms of
this Agreement, including, without limitation, any documents required to be
delivered pursuant to Section 5.4 above, or which are reasonably requested
by the Investor in connection therewith; (ii) execute and deliver to the
Investor such documents, instruments, certificates, assignments and other
writings, and do such other acts necessary or desirable, to evidence, preserve
and/or protect the CDCI Preferred Shares purchased by the Investor, as Investor
may reasonably require; and (iii) do and execute all and such further
lawful and reasonable acts, conveyances and assurances for the better and more
effective carrying out of the intents and purposes of this Agreement, as the
Investor shall reasonably require from time to time.

 

ARTICLE VI

 

MISCELLANEOUS

 

Section 6.1            Termination.  This Agreement shall terminate upon the
earliest to occur of:

 

(a)           termination at any time prior to the Closing:

 

(i)       by either the Investor or the Company if the Closing shall not
have occurred by the 30th calendar day following the Signing Date; provided, however, that
in the event the Closing has not occurred by such 30th calendar day, the parties
will consult in good faith to determine whether to extend the term of this
Agreement, it being understood that the parties shall be required to consult
only until the fifth calendar day after such 30th calendar day and not be under
any obligation to extend the term of this Agreement thereafter; provided, further, that
the right to terminate this Agreement under this Section 6.1(a)(i) shall
not be available to any party whose breach of any representation or warranty or
failure to perform any obligation under this Agreement shall have caused or
resulted in the failure of the Closing to occur on or prior to such date; or

 

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

 

(iii)     by the mutual written consent of the Investor and the Company;
or

 

(b)           the date on which all of the CDCI Preferred Shares have
been redeemed in whole; or

 

25

 

(c)           the date on which the Investor has transferred all of the
CDCI Preferred Shares to third parties which are not Affiliates of the
Investor; or

 

(d)           if the Closing shall not have occurred by September 30,
2010, on such date.

 

In
the event of termination of this Agreement as provided in this
Section 6.1, this Agreement shall forthwith become void and there shall be
no liability on the part of either party hereto except that nothing herein
shall relieve either party from liability for any breach of this Agreement.

 

Section 6.2            Survival.  (a)        This
Agreement and all representations, warranties, covenants and agreements made
herein shall survive the Closing without limitation.

 

(b)           The covenants set forth in Article IV and Annex E
and the agreements set forth in Article V shall, to the extent such
covenants do not explicitly terminate at such time as the Investor no longer
owns any CDCI Preferred Shares, survive the termination of this Agreement
pursuant to Section 6.1(c) hereof without limitation until the date
on which all of the CDCI Preferred Shares have been redeemed in whole.

 

Section 6.3            Amendment.  No amendment of any provision of this
Agreement will be effective unless made in writing and signed by an officer or
a duly authorized representative of each of the Company and the Investor; provided that for so long as the CDCI Preferred Shares are
outstanding, the Investor may at any time and from time to time
unilaterally amend Section 4.1(d) to the extent the Investor deems
necessary, in its sole discretion, to comply with, or conform to, any changes
after the Signing Date in any federal statutes, any rules and regulations
promulgated thereunder and any other publications or interpretative releases of
the Fund governing CDFIs, including, without limitation, any changes in the
criteria for certification as a CDFI by the Fund.  No failure or delay by any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise of any other right, power or privilege.  The rights and remedies herein provided shall
be cumulative of any rights or remedies provided by law.

 

Section 6.4            Waiver of Conditions.  The conditions to each party’s obligation to
consummate the Exchange are for the sole benefit of such party and may be
waived by such party in whole or in part to the extent permitted by applicable
law.  No waiver will be effective unless
it is in a writing signed by a duly authorized officer of the waiving party
that makes express reference to the provision or provisions subject to such
waiver.

 

Section 6.5            Governing Law; Submission to
Jurisdiction, etc.  This Agreement 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 parties hereto agrees (a) to submit to the exclusive
jurisdiction and venue of the United States District Court for the

 

26

 

District of Columbia and the United States Court of
Federal Claims for any and all civil actions, suits or proceedings arising out
of or relating to this Agreement or the Exchange contemplated hereby and
(b) that notice may be served upon (i) the Company at the address and
in the manner set forth for notices to the Company in Section 6.6 and
(ii) the Investor at the address and in the manner set forth for notices
to the Company in Section 6.6, but otherwise in accordance with federal
law.  TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY UNCONDITIONALLY WAIVES TRIAL
BY JURY IN ANY CIVIL LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR
THE EXCHANGE CONTEMPLATED HEREBY.

 

Section 6.6            Notices.  Any notice, request, instruction or other
document to be given hereunder by any party to the other will be in writing and
will be deemed to have been duly given (a) on the date of delivery if
delivered personally, or by facsimile, upon confirmation of receipt, or
(b) on the second business day following the date of dispatch if delivered
by a recognized next day courier service. 
All notices hereunder shall be delivered as set forth below or pursuant
to such other instructions as may be designated in  writing by the party to receive such notice.

 

If
to the Company as set forth in Schedule A.

 

If
to the Investor:

 

United
States Department of the Treasury 

1500 Pennsylvania Avenue, NW

Washington, D.C. 20220

Attention:  Chief Counsel, Office of
Financial Stability

Facsimile:
(202) 927-9225

E-mail: CDCINotice@do.treas.gov

 

with
a copy to:

 

E-mail:  OFSChiefCounselNotices@do.treas.gov

 

Section 6.7            Definitions, Interpretation.

 

(a)           Definitions.

 

(i)       When a reference is made in this Agreement to a subsidiary of
a person, the term “subsidiary”
means any corporation, partnership, joint venture, limited liability company or
other entity (x) of which such person or a subsidiary of such person is a
general partner or (y) of which a majority of the voting securities or
other voting interests, or a majority of the securities or other interests of
which having by their terms ordinary voting power to elect a majority of the
board of directors or persons performing similar functions with respect to such
entity, is directly or indirectly owned by such person and/or one or more
subsidiaries thereof.

 

27

 

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

 

(iii)     The term “Appropriate Federal Banking Agency” means the “appropriate
Federal banking agency” with respect to the Company or such Company
Subsidiaries, as applicable, as defined in Section 3(q) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1813(q)).

 

(iv)    The term “Bank Holding Company” means a company registered
as such with the Board of Governors of the Federal Reserve System (the “Federal Reserve”) pursuant to 12 U.S.C. §1842 and the
regulations of the Federal Reserve promulgated thereunder.

 

(v)     The term “Business Combination” means a merger,
consolidation, statutory share exchange or similar transaction that requires
the approval of the Company’s stockholders.

 

(vi)    The term “Certified Entity” means the Company or, if the
Company itself has not been certified by the Fund as a CDFI, each Affiliate of
the Company that has been certified by the CDFI and is specified on Schedule A
of the Letter Agreement.

 

(vii)   The term “Company Financial Statements” means the
consolidated financial statements of the Company and its consolidated
subsidiaries for each of the last three completed fiscal years of the Company
(which shall be audited to the extent audited financial statements are
available) and each completed quarterly period since the last completed fiscal
year, required to be delivered to Investor pursuant to the CPP Securities Purchase
Agreement.

 

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

 

28

 

the extent that such changes
or occurrences have or would reasonably be expected to have a materially
disproportionate adverse effect on the Company and its consolidated
subsidiaries taken as a whole relative to comparable U.S. banking or financial
services organizations); or (ii) the ability of the Company to consummate
the Exchange and the other transactions contemplated by this Agreement and
perform its obligations hereunder or thereunder on a timely basis.

 

(ix)    The term “Designated Matters” means (i) the election
and removal of directors, (ii) the approval of any Business Combination,
(iii) the approval of a sale of all or substantially all of the assets or
property of the Company, (iv) the approval of a dissolution of the
Company, (v) the approval of any issuance of any securities of the Company
on which holders of Common Stock are entitled to vote, (vi) the approval
of any amendment to the Charter or bylaws of the Company on which holders of
Common Stock are entitled to vote, (vii) any matters which require
stockholder approval under any applicable national stock exchange rules and
(viii) the approval of any other matters reasonably incidental to the
matters set forth in subclauses (i) through (vii) as determined
by the Investor.

 

(x)     The term “Disclosure Schedule”  means
collectively, those certain schedules delivered to the Investor on or prior to
(i) the CPP Signing Date, with respect to the “Disclosure Schedule”
delivered in connection with the CPP Securities Purchase Agreement and
(ii) the Signing Date with respect to the schedules required to be
delivered under this Agreement, setting forth, among other things, items the
disclosure of which is necessary or appropriate either in response to an
express disclosure requirement contained in a provision hereof or as an
exception to one or more representations or warranties contained in
Section 2.2 of the CPP Securities Purchase Agreement or Article III
hereof.

 

(xi)    The term “EAWA” means the Employ American Workers Act
(Section 1611 of Division A, Title XVI of the American Recovery and
Reinvestment Act of 2009), Public Law No. 111-5, effective as of February 17,
2009, as may be amended and in effect from time to time.

 

(xii)   The term “Junior Stock” means the Common Stock and any
other class or series of stock of the Company the terms of which expressly
provide that it ranks junior to the CDCI Preferred Shares as to dividend rights
and/or as to rights on liquidation, dissolution or winding up of the Company.

 

(xiii)                  The term “Parity Stock”
means any class or series of stock of the Company the terms of which do not
expressly provide that such class or series will rank senior or junior to the
CDCI Preferred Shares as to dividend rights and/or as to rights on liquidation,
dissolution or winding up of the Company (in each case without regard to
whether dividends accrue cumulatively or non-cumulatively).

 

(xiv)                  The term “Previously Disclosed”
means information set forth on the Disclosure Schedule or the Disclosure
Update, as applicable; provided, however,
that disclosure in any section of such Disclosure Schedule or Disclosure
Update, as

 

29

 

applicable, shall apply only
to the indicated section of this Agreement except to the extent that it is
reasonably apparent from the face of such disclosure that such disclosure is
relevant to another section of this Agreement; provided, further, that the existence of Previously Disclosed
information, pursuant to a Disclosure Update, shall neither obligate the
Investor to consummate the Exchange nor limit or affect any rights of or
remedies available to the Investor.

 

(xv)   The term “Savings and Loan Holding Company” means a company
registered as such with the Office of Thrift Supervision pursuant to 12 U.S.C.
§1467(a) and the regulations of the Office of Thrift Supervision
promulgated thereunder.

 

(xvi)                  The term “Senior Executive Officers” means
the Company’s “senior executive officers” as defined in Section 111 of the
EESA and the Compensation Regulations.

 

(xvii)                 The term “Share Dilution
Amount” means the increase in the number of diluted shares outstanding
(determined in accordance with GAAP, and as measured from the date of the
Company’s most recent consolidated financial statements prior to the Closing
Date) resulting from the grant, vesting or exercise of equity-based
compensation to employees and equitably adjusted for any stock split, stock
dividend, reverse stock split, reclassification or similar transaction.

 

(xviii)                The term “Tax” or “Taxes” means any federal, state, local or foreign
income, gross receipts, property, sales, use, license, excise, franchise,
employment, payroll, withholding, alternative or add on minimum, ad valorem, transfer or excise tax, or any other tax,
custom, duty, governmental fee or other like assessment or charge of any kind
whatsoever, together with any interest, penalty or addition imposed by any
Governmental Entity.

 

(xix)                  To the extent any securities issued pursuant to
this Agreement or the transactions contemplated hereby are registered in the
name of a designee of the Investor pursuant to Section 1.2 or Section 6.9(c) or
transferred to an Affiliate of the Investor, all references herein to the
Investor holding or owning any debt or equity securities of the Company, CDCI
Preferred Shares shall be deemed to refer to the Investor, together with such
designees and/or Affiliates, holding or owning any debt or equity securities,
CDCI Preferred Shares (and any like variations thereof), as applicable.

 

Section 6.8            Interpretation.  When a reference is made in this Agreement to
“Recitals”, “Articles”, “Sections”, “Annexes” or “Schedules” such reference
shall be to a Recital, Article or Section of, or Annex or
Schedule to, this Agreement, unless otherwise indicated.  The terms defined in the singular have a
comparable meaning when used in the plural, and vice versa.  References to “herein”, “hereof”, “hereunder”
and the like refer to this Agreement as a whole and not to any particular
section or provision, unless the context requires otherwise.  The table of contents and headings contained
in this Agreement are for reference purposes only and are not part of this
Agreement.  Whenever the words “include”,
“includes” or “including” are used in this Agreement, they shall be deemed
followed by the words “without limitation.” No rule of construction
against the draftsperson shall be applied in connection with

 

30

 

the interpretation or enforcement of this Agreement,
as this Agreement is entered into between sophisticated parties advised by
counsel.  All references to “$” or “dollars”
mean the lawful currency of the United States of America.  Except as expressly stated in this Agreement,
all references to any statute, rule or regulation are to the statute, rule or
regulation as amended, modified, supplemented or replaced from time to time
(and, in the case of statutes, include any rules and regulations
promulgated under the statute) and to any section of any statute, rule or
regulation include any successor to the section.  References to a “business day” shall mean any
day except Saturday, Sunday and any day on which banking institutions in the
State of New York or the District of Columbia generally are authorized or
required by law or other governmental actions to close.

 

Section 6.9                                   Assignment.  Neither this Agreement nor any right, remedy,
obligation nor liability arising hereunder or by reason hereof shall be assignable
by any party hereto without the prior written consent of the other party, and
any attempt to assign any right, remedy, obligation or liability hereunder
without such consent shall be void, except (a) an assignment, in the case
of a merger, consolidation, statutory share exchange or similar transaction
that requires the approval of the Company’s stockholders where such party is
not the surviving entity, or a sale of substantially all of its assets, to the
entity which is the survivor of such Business Combination or the purchaser in
such sale, (b) an assignment of certain rights as provided in
Sections 4.1(c) or 4.1(j) or Annex E or (c) an
assignment by the Investor of this Agreement to an Affiliate of the Investor; provided that if the Investor assigns this Agreement to an
Affiliate, the Investor shall be relieved of its obligations under this
Agreement but (i) all rights, remedies and obligations of the Investor
hereunder shall continue and be enforceable by such Affiliate, (ii) the
Company’s obligations and liabilities hereunder shall continue to be
outstanding and (iii) all references to the Investor herein shall be
deemed to be references to such Affiliate.

 

Section 6.10                            Severability.  If any provision of this Agreement, or the
application thereof to any person or circumstance, is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.  Upon
such determination, the parties shall negotiate in good faith in an effort to
agree upon a suitable and equitable substitute provision to effect the original
intent of the parties.

 

Section 6.11                            No
Third-Party Beneficiaries.  Other than as expressly provided herein,
nothing contained in this Agreement, expressed or implied, is intended to
confer upon any person or entity other than the Company and the Investor (and
any Indemnitee) any benefit, right or remedies.

 

Section 6.12                            Entire
Agreement, etc. 
(a) This Agreement (including the Annexes and Schedules hereto)
constitutes the entire agreement, and supersedes all other prior agreements,
understandings, representations and warranties, both written and oral, between
the parties, with respect to the subject matter hereof.

 

31

 

(b)                                 For the
avoidance of doubt, for so long as the Investor holds any outstanding CPP
Preferred Stock or warrants issued by the Company to the Investor pursuant to
the CPP Securities Purchase Agreement or any securities issuable upon the
exercise thereof or exchanged therefor (collectively, the “CPP Securities”),
the CPP Securities Purchase Agreement and the CPP Securities shall remain in
full force and effect, other than as specifically modified herein.

 

Section 6.13                            Specific
Performance.  The parties
agree that irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance with their
specific terms.  It is accordingly agreed
that the parties shall be entitled (without the necessity of posting a bond) to
specific performance of the terms hereof, this being in addition to any other
remedies to which they are entitled at law or equity.

 

[Remainder of Page Intentionally Left Blank]

 

32

 

ANNEX A

 

FORM OF OFFICER’S CERTIFICATE

 

OFFICER’S CERTIFICATE

 

OF

 

[COMPANY]

 

In
connection with that certain letter agreement, dated [                        ], 2010 (the “Agreement”) by
and between [COMPANY] (the
“Company”) and the United States
Department of the Treasury which incorporates that certain Exchange Agreement —
Standard Terms referred to therein (the “Standard Terms”),
the undersigned does hereby certify as follows:

 

1.                                      I am a duly
elected/appointed [                        ] of the Company.

 

2.                                      The
representations and warranties of the Company set forth in Article III
of the Standard Terms are true and correct in all respects as though as of the
date hereof (other than representations and warranties that by their terms
speak as of another date, which representations and warranties shall be true
and correct in all respects as of such other date) and the Company has
performed in all material respects all obligations required to be performed by
it under the Agreement.

 

3.                                      The New
Certificate of Designations, a true, complete and correct copy of which is
attached as Exhibit A hereto, has been filed with, and accepted by,
the Secretary of State of the State of [                      ].

 

4.                                      The Company has
effected such changes to its Benefit Plans with respect to its Senior Executive
Officers and any other employee of the Company or its Affiliates subject to
Section 111 of EESA, as implemented by any Compensation Regulations (and
to the extent necessary for such changes to be legally enforceable, each of its
Senior Executive Officers and other employees has duly consented in writing to
such changes), as may be necessary, during the Relevant Period, in order to
comply with Section 111 of EESA or the Compensation Regulations.

 

5.                                      The Charter and
bylaws of the Company delivered to the Investor pursuant to the CPP Securities
Purchase Agreement are true, complete and correct as of the date hereof.

 

The
foregoing certifications are made and delivered as of [                  ] pursuant to Section 1.2 of the Standard Terms.

 

Capitalized
terms used and not otherwise defined herein shall have the meanings assigned to
them in the Standard Terms.

 

[SIGNATURE PAGE FOLLOWS]

 

UST Sequence Number: 318

 

1

 

IN
WITNESS WHEREOF, this Officer’s Certificate has been duly executed and
delivered as of the [    ] day of [                    ], 20[    ].

 

	
   

  	
  [COMPANY]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

2

 

EXHIBIT A

 

3

 

ANNEX B

 

FORM OF NEW CERTIFICATE OF DESIGNATIONS

 

[SEE ATTACHED]

 

UST
Sequence Number: 318

 

1

 

ANNEX C

 

FORM OF OPINION

 

(a)                                 The Company has
been duly formed and is validly existing as a [TYPE OF
ORGANIZATION] and is in good standing under the laws of the
jurisdiction of its organization.  The
Company has all necessary power and authority to own, operate and lease its
properties and to carry on its business as it is being conducted.

 

(b)                                 The Company has
been duly qualified as a foreign entity for the transaction of business and is
in good standing under the laws of [                          ], [                          ] and [                          ].

 

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

 

(d)                                 The Company has
the corporate power and authority to execute and deliver the Agreement and to
carry out its obligations thereunder (which includes the issuance of the CDCI
Preferred Shares).

 

(e)                                  The execution,
delivery and performance by the Company of the Agreement and the consummation
of the transactions contemplated thereby have been duly authorized by all
necessary corporate action on the part of the Company and its stockholders, and
no further approval or authorization is required on the part of the Company,
including, without limitation, by any rule or requirement of any national
stock exchange.

 

(f)                                   The Agreement
is a valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and general equitable
principles, regardless of whether such enforceability is considered in a
proceeding at law or in equity.

 

(g)                                  The execution
and delivery by the Company of this Agreement and the performance by the
Company of its obligations thereunder (i) do not require any approval by
any Governmental Entity to be obtained on the part of the Company, except those
that have been obtained, (ii) do not violate or conflict with any
provision of the Charter, (iii) do not violate, conflict with, or result
in a breach of any provision of, or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a default) under, or
result in the termination of, or accelerate the performance required by, or
result in a right of termination or acceleration of, or result in the creation
of, any lien, security interest, charge or encumbrance upon any of the
properties or assets of the Company or any Company Subsidiary under any of the
terms, conditions or provisions of its organizational documents or under any
agreement, contract, indenture, lease, mortgage, power of attorney, evidence of
indebtedness, letter of credit, license, 

 

UST Sequence Number: 318

 

1

 

instrument,
obligation, purchase or sales order, or other commitment, whether oral or
written, to which it is a party or by which it or any of its properties is
bound or (iv) do not conflict with, breach or result in a violation of, or
default under any judgment, decree or order known to us that is applicable to
the Company and, pursuant to any applicable laws, is issued by any Governmental
Entity having jurisdiction over the Company.

 

(h)                                 Other than the
filing of the New Certificate of Designations with the Secretary of State of
its jurisdiction of organization or other applicable Governmental Entity, such
filings and approvals as are required to be made or obtained under any state “blue
sky” laws and such consents and approvals that have been made or obtained, no
notice to, filing with, exemption or review by, or authorization, consent or
approval of, any Governmental Entity is required to be made or obtained by the
Company in connection with the consummation by the Company of the Exchange.

 

(i)                                     The Company is
not nor, after giving effect to the issuance of the CDCI Preferred Shares
pursuant to the Agreement, would be on the date hereof an “investment company”
or an entity “controlled” by an “investment company,” as such terms are defined
in the Investment Company Act of 1940, as amended.

 

(j)                                    Each Certified
Entity (A) is a regulated community development financial institution (a “CDFI”) currently certified by the Community Development
Financial Institution Fund (the “Fund”) of the
United States Department of the Treasury pursuant to 12 C.F.R. 1805.201(a) and
(B) satisfies all of the eligibility requirements of the Fund’s Community
Development Financial Institutions Program for a CDFI.

 

2

 

ANNEX D

 

FORM OF WAIVER

 

In
consideration for the benefits I will receive as a result of the participation
of [                                        ] (together with its subsidiaries and affiliates, the “Company”)
in the United States Department of the Treasury’s (the “Treasury”)
Capital Purchase Program, Community Development Capital Initiative and/or any
other economic stabilization program implemented by the Treasury under the
Emergency Economic Stabilization Act of 2008 (as amended, supplemented, or
otherwise modified, the “EESA”) (any such program, including the Capital
Purchase Program and the Community Development Capital Initiative, a “Program”), I
hereby voluntarily waive any claim against the United States (and each of its
departments and agencies) or the Company or any of its directors, officers,
employees and agents for any changes to my compensation or benefits that are
required to comply with the executive compensation and corporate governance
requirements of Section 111 of the EESA, as implemented by any guidance or
regulations issued and/or to be issued thereunder, including without limitation
the provisions for the Capital Purchase Program, as implemented by any guidance
or regulation thereunder, including the rules set forth in 31 C.F.R. Part 30,
or any other guidance or regulations under the EESA and the applicable
requirements of the Exchange Agreement by and among the Company and the
Treasury dated as of
              
    , 2010, as amended (such requirements, the “Limitations”).

 

I
acknowledge that the Limitations may require modification or termination of the
employment, compensation, bonus, incentive, severance, retention and other
benefit plans, arrangements, policies and agreements (including so-called “golden
parachute” agreements), whether or not in writing, that I may have with the
Company or in which I may participate as they relate to the period the United
States holds any equity or debt securities of the Company acquired through a
Program or for any other period applicable under such Program or Limitations,
as the case may be, and I hereby consent to all such modifications.

 

This
waiver includes all claims I may have under the laws of the United States or
any other jurisdiction (whether or not in existence as of the date hereof)
related to the requirements imposed by the Limitations, including without
limitation, a claim for any compensation or other payments or benefits I would
otherwise receive, any challenge to the process by which the Limitations are or
were adopted and any tort or constitutional claim about the effect of these
Limitations on my employment relationship and I hereby agree that I will not at
any time initiate, or cause or permit to be initiated on my behalf, any such
claim against the United States, the Company or its directors, officers,
employees or agents in or before any local, state, federal or other agency,
court or body.

 

I
agree that, in the event and to the extent that the Compensation Committee of
the Board of Directors of the Company or similar governing body (the “Committee”)
reasonably determines that any compensatory payment and benefit provided to me,
including any bonus or incentive compensation based on materially inaccurate
financial statements or performance criteria, would cause the Company to fail
to be in compliance with the Limitations (such payment or benefit, an “Excess
Payment”), upon notification from the Company, I shall repay such
Excess Payment to 

 

UST
Sequence Number: 318

 

1

 

the
Company within 15 business days. In addition, I agree that the Company
shall have the right to postpone any such payment or benefit for a reasonable
period of time to enable the Committee to determine whether such payment or
benefit would constitute an Excess Payment.

 

I
understand that any determination by the Committee as to whether or not,
including the manner in which, a payment or benefit needs to be modified,
terminated or repaid in order for the Company to be in compliance with
Section 111 of the EESA and/or the Limitations shall be a final and
conclusive determination of the Committee which shall be binding upon me. I
further understand that the Company is relying on this letter from me in
connection with its participation in a Program.

 

2

 

IN
WITNESS WHEREOF, I execute this waiver on my own behalf, thereby
communicating my acceptance and acknowledgement to the provisions herein.

 

	
   

  	
  Respectfully,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
  Date:

  

 

3

 

ANNEX E

 

REGISTRATION RIGHTS

 

1.1                               Definitions.  Terms not defined in this Annex shall
have the meaning ascribed to such terms in the Agreement. As used in this
Annex E, the following terms shall have the following respective meanings:

 

(a)                                 “Holder” means the Investor and any other holder of
Registrable Securities to whom the registration rights conferred by this
Agreement have been transferred in compliance with Section 1.9 hereof.

 

(b)                                 “Holders’ Counsel” means one counsel for the selling Holders
chosen by Holders holding a majority interest in the Registrable Securities
being registered.

 

(c)                                  “Pending Underwritten Offering” means, with respect to any
Holder forfeiting its rights pursuant to Section 1.11 of this
Annex E, any underwritten offering of Registrable Securities in which such
Holder has advised the Company of its intent to register its Registrable
Securities either pursuant to Section 1.2(b) or 1.2(d) of this
Annex E prior to the date of such Holder’s forfeiture.

 

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

 

(e)                                  “Registrable Securities”  means
(A) all CDCI Preferred Shares and (B) any equity securities issued or
issuable directly or indirectly with respect to the securities referred to in
the foregoing clause (A) by way of conversion, exercise or exchange
thereof, or share dividend or share split or in connection with a combination
of shares, recapitalization, reclassification, merger, amalgamation,
arrangement, consolidation or other reorganization,  provided that, once issued, such
securities will not be Registrable Securities when (1) they are sold
pursuant to an effective registration statement under the Securities Act,
(2) they shall have ceased to be outstanding or (3) they have been
sold in any transaction in which the transferor’s rights under this Agreement
are not assigned to the transferee of the securities.  No Registrable Securities may be registered
under more than one registration statement at any one time.

 

(f)                                   “Registration Expenses” mean all expenses incurred by the
Company in effecting any registration pursuant to this Agreement (whether or
not any registration or prospectus becomes effective or final) or otherwise
complying with its obligations under this Annex E, including all
registration, filing and listing fees, printing expenses, fees and
disbursements of counsel for the Company, blue sky fees and expenses, expenses
incurred in connection with any “road show”, the reasonable fees and
disbursements  of  Holders’ Counsel,  and expenses of the Company’s independent
accountants in connection with any regular or 

 

UST Sequence Number: 318

 

E-1

 

special
reviews or audits incident to or required by any such registration, but shall
not include Selling Expenses.

 

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

 

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

 

(i)                                     “Special Registration” means the registration of
(A) equity securities and/or options or other rights in respect thereof
solely registered on Form S-4 or Form S-8 (or successor form) or
(B) shares of equity securities and/or options or other rights in respect
thereof to be offered to directors, members of management, employees,
consultants, customers, lenders or vendors of the Company or Company
Subsidiaries or in connection with dividend reinvestment plans.

 

1.2                               Registration.

 

(a)                                 The Company
covenants and agrees that as promptly as practicable after the date that the
Company becomes subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act (and in any event no later than 30 days thereafter), the
Company shall prepare and file with the SEC a Shelf Registration Statement
covering all Registrable Securities (or otherwise designate an existing shelf
registration on an appropriate form under Rule 415 under the Securities
Act (a “Shelf Registration Statement”) filed
with the SEC to cover the Registrable Securities), and, to the extent the Shelf
Registration Statement has not theretofore been declared effective or is not
automatically effective upon such filing, the Company shall use reasonable best
efforts to cause such Shelf Registration Statement to be declared or become
effective and to keep such Shelf Registration Statement continuously effective and
in compliance with the Securities Act and usable for resale of such Registrable
Securities for a period from the date of its initial effectiveness until such
time as there are no Registrable Securities remaining (including by refiling
such Shelf Registration Statement (or a new Shelf Registration Statement) if
the initial Shelf Registration Statement expires).  Notwithstanding the foregoing, if the Company
is not eligible to file a registration statement on Form S-3, then the
Company shall not be obligated to file a Shelf Registration Statement unless
and until requested to do so in writing by the Investor.

 

(b)                                 Any
registration pursuant to Section 1.2(a) of this Annex E shall be
effected by means of a Shelf Registration Statement on an appropriate form under
Rule 415 under the Securities Act (a “Shelf Registration
Statement”).  If the Investor
or any other Holder intends to distribute any Registrable Securities by means
of an underwritten offering it shall promptly so advise the Company and the
Company shall take all reasonable steps to facilitate such distribution,
including the actions required pursuant to Section 1.2(d) of this
Annex E; provided that the Company shall
not be required to facilitate an underwritten offering of Registrable
Securities unless (i) the expected gross proceeds from such offering
exceed $200,000 

 

E-2

 

or
(ii) such underwritten offering includes all of the outstanding
Registrable Securities held by such Holder. 
The lead underwriters in any such distribution shall be selected by the
Holders of a majority of the Registrable Securities to be distributed.

 

(c)                                  The Company
shall not be required to effect a registration (including a resale of
Registrable Securities from an effective Shelf Registration Statement) or an
underwritten offering pursuant to Section 1.2 of this Annex E:  (A) with respect to securities that are
not Registrable Securities; or (B) if the Company has notified the
Investor and all other Holders that in the good faith judgment of the Board of
Directors, it would be materially detrimental to the Company or its
securityholders for such registration or underwritten offering to be effected
at such time, in which event the Company shall have the right to defer such
registration for a period of not more than 45 days after receipt of the request
of the Investor or any other Holder; provided that
such right to delay a registration or underwritten offering shall be exercised
by the Company (1) only if the Company has generally exercised (or is
concurrently exercising) similar black-out rights against holders of similar
securities that have registration rights and (2) not more than three times
in any 12-month period and not more than 90 days in the aggregate in any
12-month period.

 

(d)                                 If during any
period when an effective Shelf Registration Statement is not available, the
Company proposes to register any of its equity securities, other than a
registration pursuant to Section 1.2(a) of this Annex E or a
Special Registration, and the registration form to be filed may be used for the
registration or qualification for distribution of Registrable Securities, the
Company will give prompt written notice to the Investor and all other Holders
of its intention to effect such a registration (but in no event less than ten
days prior to the anticipated filing date) and will include in such
registration all Registrable Securities with respect to which the Company has
received written requests for inclusion therein within ten business days after
the date of the Company’s notice (a “Piggyback Registration”).  Any such person that has made such a written
request may withdraw its Registrable Securities from such Piggyback
Registration by giving written notice to the Company and the managing
underwriter, if any, on or before the fifth business day prior to the planned
effective date of such Piggyback Registration. The Company may terminate or
withdraw any registration under this Section 1.2(d) prior to the
effectiveness of such registration, whether or not Investor or any other
Holders have elected to include Registrable Securities in such registration.

 

(e)                                  If the
registration referred to in Section 1.2(d) of this Annex E is
proposed to be underwritten, the Company will so advise Investor and all other Holders
as a part of the written notice given pursuant to Section 1.2(d) of
this Annex E.  In such event, the
right of Investor and all other Holders to registration pursuant to
Section 1.2 of this Annex E will be conditioned upon such persons’
participation in such underwriting and the inclusion of such person’s
Registrable Securities in the underwriting if such securities are of the same
class of securities as the securities to be offered in the underwritten
offering, and each such person will (together with the Company and the other
persons distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company; provided
that the Investor (as opposed to other Holders) shall not be required to
indemnify any person in connection with any registration. If any participating
person disapproves of the terms of the underwriting, such person 

 

E-3

 

may
elect to withdraw therefrom by written notice to the Company, the managing
underwriters and the Investor (if the Investor is participating in the
underwriting).

 

(f)                                   If either
(x) the Company grants “piggyback” registration rights to one or more third
parties to include their securities in an underwritten offering under the Shelf
Registration Statement pursuant to Section 1.2(b) of this
Annex E or (y) a Piggyback Registration under Section 1.2(d) of
this Annex E relates to an underwritten offering on behalf of the Company,
and in either case the managing underwriters advise the Company that in their
reasonable opinion the number of securities requested to be included in such
offering exceeds the number which can be sold without adversely affecting the
marketability of such offering (including an adverse effect on the per share
offering price), the Company will include in such offering only such number of
securities that in the reasonable opinion of such managing underwriters can be
sold without adversely affecting the marketability of the offering (including
an adverse effect on the per share offering price), which securities will be so
included in the following order of priority: (A) first, in the case of a
Piggyback Registration under Section 1.2(d) of this Annex E, the
securities the Company proposes to sell, (B) then the Registrable
Securities of the Investor and all other Holders who have requested inclusion
of Registrable Securities pursuant to Section 1.2(b) or
Section 1.2(d) of this Annex E, as applicable, pro rata on the basis of the aggregate number of such
securities or shares owned by each such person and (C) lastly, any other
securities of the Company that have been requested to be so included, subject
to the terms of this Agreement; provided, however, that if the Company has, prior to the Signing Date,
entered into an agreement with respect to its securities that is inconsistent
with the order of priority contemplated hereby then it shall apply the order of
priority in such conflicting agreement to the extent that it would otherwise
result in a breach under such agreement.

 

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

 

1.4                               Obligations of
the Company.  Whenever
required to effect the registration of any Registrable Securities or facilitate
the distribution of Registrable Securities pursuant to an effective Shelf
Registration Statement, the Company shall, as expeditiously as reasonably
practicable:

 

(a)                                 Prepare and
file with the SEC a prospectus supplement or post-effective amendment with
respect to a proposed offering of Registrable Securities pursuant to an
effective registration statement, subject to Section 1.4 of this
Annex E, keep such registration statement effective and keep such
prospectus supplement current until the securities described therein are no
longer Registrable Securities.

 

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

 

E-4

 

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

 

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

 

(e)                                  Notify each
Holder of Registrable Securities at any time when a prospectus relating thereto
is required to be delivered under the Securities Act of the happening of any
event as a result of which the applicable prospectus, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing.

 

(f)                                   Give written
notice to the Holders:

 

(i)                                     when any
registration statement filed pursuant to Section 4.1(j) of the
Agreement or any amendment thereto has been filed with the SEC (except for any
amendment effected by the filing of a document with the SEC pursuant to the
Exchange Act) and when such registration statement or any post-effective
amendment thereto has become effective;

 

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

 

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

 

(iv)                              of the receipt
by the Company or its legal counsel of any notification with respect to the
suspension of the qualification of the applicable Registrable Securities for
sale in any jurisdiction or the initiation or threatening of any proceeding for
such purpose;

 

(v)                                 of the
happening of any event that requires the Company to make changes in any
effective registration statement or the prospectus related to the registration
statement in order to make the statements therein not misleading (which notice
shall be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made); and

 

E-5

 

(vi)                              if at any time
the representations and warranties of the Company contained in any underwriting
agreement contemplated by Section 1.4(j) of this Annex E cease
to be true and correct.

 

(g)                                  Use its
reasonable best efforts to prevent the issuance or obtain the withdrawal of any
order suspending the effectiveness of any registration statement referred to in
Section 1.4(f)(iii) of this Annex E at the earliest practicable
time.

 

(h)                                 Upon the
occurrence of any event contemplated by Section 1.4(e) or 1.4(f)(v) of
this Annex E, promptly prepare a post-effective amendment to such
registration statement or a supplement to the related prospectus or file any
other required document so that, as thereafter delivered to the Holders and any
underwriters, the prospectus will not contain an untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.  If the Company notifies the
Holders in accordance with Section 1.4(f)(v) to suspend the use of
the prospectus until the requisite changes to the prospectus have been made,
then the Holders and any underwriters shall suspend use of such prospectus and
use their reasonable best efforts to return to the Company all copies of such
prospectus (at the Company’s expense) other than permanent file copies then in
such Holders’ or underwriters’ possession. 
The total number of days that any such suspension may be in effect in
any 12-month period shall not exceed 90 days.

 

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

 

(j)                                    If an
underwritten offering is requested pursuant to Section 1.2(b) of this
Annex E, enter into an underwriting agreement in customary form, scope and
substance and take all such other actions reasonably requested by the Holders
of a majority of the Registrable Securities being sold in connection therewith
or by the managing underwriter(s), if any, to expedite or facilitate the
underwritten disposition of such Registrable Securities, and in connection
therewith in any underwritten offering (including making members of management
and executives of the Company available to participate in “road shows”, similar
sales events and other marketing activities), (A) make such
representations and warranties to the Holders that are selling stockholders and
the managing underwriter(s), if any, with respect to the business of the
Company and its subsidiaries, and the Shelf Registration Statement, prospectus
and documents, if any, incorporated or deemed to be incorporated by reference
therein, in each case, in customary form, substance and scope, and, if true,
confirm the same if and when requested, (B) use its reasonable best
efforts to furnish the underwriters with opinions of counsel to the Company,
addressed to the managing underwriter(s), if any, covering the matters
customarily covered in such opinions requested in underwritten offerings,
(C) use its reasonable best efforts to obtain “cold comfort” letters from
the independent certified public accountants of the Company (and, if necessary,
any other independent certified public accountants of any business acquired by
the Company for which financial statements and financial data are included in
the Shelf Registration Statement) who have certified the financial statements
included in such Shelf Registration Statement, addressed to each of the
managing underwriter(s), if any, such letters to be in customary form and
covering matters of the type customarily covered in “cold comfort” 

 

E-6

 

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

 

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

 

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

 

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

 

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

 

1.5                               Suspension of
Sales.  Upon receipt of written notice
from the Company that a registration statement, prospectus or prospectus
supplement contains or may contain an untrue statement of a material fact or
omits or may omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that circumstances
exist that make inadvisable use of such registration statement, prospectus or
prospectus supplement, the Investor and each Holder of Registrable Securities
shall forthwith discontinue disposition of Registrable Securities until the
Investor and/or Holder has received copies of a supplemented or amended
prospectus or prospectus supplement, or until the Investor and/or such Holder
is advised in writing by the Company that the use of the prospectus and, if
applicable, prospectus supplement may be resumed, and, if so directed by the
Company, the Investor and/or such Holder shall deliver to the Company (at the
Company’s expense) all copies, other than 

 

E-7

 

permanent
file copies then in the Investor and/or such Holder’s possession, of the
prospectus and, if applicable, prospectus supplement covering such Registrable
Securities current at the time of receipt of such notice.  The total number of days that any such
suspension may be in effect in any 12-month period shall not exceed 90 days.

 

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

 

1.7                               Furnishing
Information.

 

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

 

(b)                                 It shall be a
condition precedent to the obligations of the Company to take any action
pursuant to Section 1.4 of this Annex E that Investor and/or the
selling Holders and the underwriters, if any, shall furnish to the Company such
information regarding themselves, the Registrable Securities held by them and
the intended method of disposition of such securities as shall be required to
effect the registered offering of their Registrable Securities.

 

1.8                               Indemnification.

 

(a)                                 The Company
agrees to indemnify each Holder and, if a Holder is a person other than an
individual, such Holder’s officers, directors, employees, agents,
representatives and Affiliates, and each person, if any, that controls a Holder
within the meaning of the Securities Act (each, an “Indemnitee”),
against any and all losses, claims, damages, actions, liabilities, costs and
expenses (including reasonable fees, expenses and disbursements of attorneys
and other professionals incurred in connection with investigating, defending,
settling, compromising or paying any such losses, claims, damages, actions,
liabilities, costs and expenses), joint or several, arising out of or based
upon any untrue statement or alleged untrue statement of material fact
contained in any registration statement, including any preliminary prospectus
or final prospectus contained therein or any amendments or supplements thereto
or any documents incorporated therein by reference or contained in any free
writing prospectus (as such term is defined in Rule 405) prepared by the
Company or authorized by it in writing for use by such Holder (or any amendment
or supplement thereto); or any omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; provided, that the Company shall not be liable to such
Indemnitee in any such case to the extent that any such loss, claim, damage,
liability (or action or proceeding in respect thereof) or expense arises out of
or is based upon (A) an untrue statement or omission made in such
registration statement, including any such preliminary prospectus or final
prospectus contained therein or any such amendments or supplements thereto or
contained in any free writing prospectus (as such term is defined in Rule 405)
prepared by the Company or authorized by it in writing for use by such Holder
(or any amendment or supplement thereto), in reliance upon and in conformity
with information regarding such Indemnitee or its plan of distribution or
ownership interests which was furnished in writing to the Company by such Indemnitee
for use in connection with such registration 

 

E-8

 

statement,
including any such preliminary prospectus or final prospectus contained therein
or any such amendments or supplements thereto, or (B)  offers or sales
effected by or on behalf of such Indemnitee “by means of” (as defined in Rule 159A)
a “free writing prospectus” (as defined in Rule 405) that was not
authorized in writing by the Company.

 

(b)                                 If the
indemnification provided for in Section 1.8(a) of this Annex E
is unavailable to an Indemnitee with respect to any losses, claims, damages,
actions, liabilities, costs or expenses referred to therein or is insufficient
to hold the Indemnitee harmless as contemplated therein, then the Company, in
lieu of indemnifying such Indemnitee, shall contribute to the amount paid or
payable by such Indemnitee as a result of such losses, claims, damages,
actions, liabilities, costs or expenses in such proportion as is appropriate to
reflect the relative fault of the Indemnitee, on the one hand, and the Company,
on the other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages, actions, liabilities, costs or
expenses as well as any other relevant equitable considerations.  The relative fault of the Company, on the one
hand, and of the Indemnitee, on the other hand, shall be determined by
reference to, among other factors, whether the untrue statement of a material
fact or omission to state a material fact relates to information supplied by
the Company or by the Indemnitee and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission;  the Company and each Holder
agree that it would not be just and equitable if contribution pursuant to this
Section 1.8(b) of this Annex E were determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to in
Section 1.8(a) of this Annex E. 
No Indemnitee guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to
contribution from the Company if the Company was not guilty of such fraudulent
misrepresentation.

 

1.9                               Assignment of
Registration Rights.  The rights
of the Investor to registration of Registrable Securities pursuant to
Section 1.2 of this Annex E may be assigned by the Investor to any
transferee or assignee of Registrable Securities; provided,
however, the transferor shall, within
ten days after such transfer, furnish to the Company written notice of the name
and address of such transferee or assignee and the number and type of
Registrable Securities that are being assigned.

 

1.10                        Clear Market.  With respect to any underwritten offering of
Registrable Securities by the Investor or other Holders pursuant to this
Annex E, the Company agrees not to effect (other than pursuant to such
registration or pursuant to a Special Registration) any public sale or
distribution, or to file any Shelf Registration Statement (other than such
registration or a Special Registration) covering any preferred stock of the
Company or any securities convertible into or exchangeable or exercisable for
preferred stock of the Company, during the period not to exceed ten days prior
and 60 days following the effective date of such offering or such longer period
up to 90 days as may be requested by the managing underwriter for such
underwritten offering.  The Company also agrees
to cause such of its directors and senior executive officers to execute and
deliver customary lock-up agreements in such form and for such time period up
to 90 days as may be requested by the managing underwriter.

 

1.11                        Forfeiture of
Rights.  At any time, any holder of
Registrable Securities (including any Holder) may elect to forfeit its rights
set forth in this Annex E from that date 

 

E-9

 

forward;
provided, that a Holder forfeiting such
rights shall nonetheless be entitled to participate under Section 1.2(d) —
(f) of this Annex E in any Pending Underwritten Offering to the same
extent that such Holder would have been entitled to if the holder had not
withdrawn; and provided, further,
that no such forfeiture shall terminate a Holder’s rights or obligations under
Section 1.7 of this Annex E with respect to any prior registration or
Pending Underwritten Offering.

 

1.12                        Specific
Performance.  The parties
hereto acknowledge that there would be no adequate remedy at law if the Company
fails to perform any of its obligations under this Annex E and that the
Investor and the Holders from time to time may be irreparably harmed by any
such failure, and accordingly agree that the Investor and such Holders, in
addition to any other remedy to which they may be entitled at law or in equity,
to the fullest extent permitted and enforceable under applicable law shall be
entitled to compel specific performance of the obligations of the Company under
this Annex E in accordance with the terms and conditions of this
Annex E.

 

1.13                        No Inconsistent
Agreements.  The Company
shall not, on or after the Signing Date, enter into any agreement with respect
to its securities that may impair the rights granted to the Investor and the
Holders under this Annex E or that otherwise conflicts with the provisions
hereof in any manner that may impair the rights granted to the Investor and the
Holders under this Annex E.  In the
event the Company has, prior to the Signing Date, entered into any agreement
with respect to its securities that is inconsistent with the rights granted to
the Investor and the Holders under this Annex E (including agreements that
are inconsistent with the order of priority contemplated by Section 1.2(f) of
Annex E) or that may otherwise conflict with the provisions hereof, the
Company shall use its reasonable best efforts to amend such agreements to
ensure they are consistent with the provisions of this Annex E.

 

1.14                        Certain
Offerings by the Investor.  An “underwritten”
offering or other disposition shall include any distribution of such securities
on behalf of the Investor by one or more broker-dealers, an “underwriting
agreement” shall include any purchase agreement entered into by such
broker-dealers, and any “registration statement” or “prospectus” shall include
any offering document approved by the Company and used in connection with such
distribution.

 

E-10

 

ANNEX F

 

OFFICER’S CERTIFICATE

 

OF

 

[COMPANY]

 

In
connection with that certain letter agreement, dated  [                        ], 2010 (the “Agreement”) by
and between [COMPANY]
(the “Company”) and the United States
Department of the Treasury (“Investor”)
which incorporates that certain Exchange Agreement —Standard Terms referred to
therein (the “Standard Terms”), the undersigned
does hereby certify as follows:

 

1.                                       I am a duly
elected/appointed [                        ] of the Company.

 

2.                                       Each Certified
Entity (as defined in the Standard Terms) (A) is certified by the
Community Development Financial Institution Fund (the “Fund”)
of the United States Department of the Treasury as a regulated community
development financial institution (a “CDFI”); (B) together
with its Affiliates collectively meets the eligibility requirements of 12
C.F.R. 1805.200(b); (C) has a primary mission of promoting community
development, as may be determined by Investor from time to time, based on
criteria set forth in 12 C.F.R. 1805.201(b)(1); (D) provides Financial
Products, Development Services, and/or other similar financing as a predominant
business activity in arm’s-length transactions; (E) serves a Target Market
by serving one or more Investment Areas and/or Targeted Populations in the
manner set forth in 12 C.F.R. 1805.201(b)(3); (F) provides Development
Services in conjunction with its Financial Products, directly, through an
Affiliate or through a contract with a third-party provider; (G) maintains
accountability to residents of the applicable Investment Area(s) or
Targeted Population(s) through representation on its governing Board of
Directors or otherwise; and (H) remains a non-governmental entity which is
not an agency or instrumentality of the United States of America, or any State
or political subdivision thereof, as described in 12 C.F.R. 1805.201(b)(6) and
within the meaning of any supplemental regulations or interpretations of 12
C.F.R. 1805.201(b)(6) or such supplemental regulations published by the
Fund.  As used herein, the terms “Affiliates”;
“Financial Products”; “Development Services”; “Target Market”;
“Investment Areas”; and “Targeted Populations” have the meanings ascribed to such
terms in 12 C.F.R. 1805.104.

 

3.                                       The information
set forth in the CDFI Certification Application delivered to the Investor
pursuant to Section 1.2(c)(xii) of the Standard Terms (the “CDFI Application”), as modified by any updates to the CDFI
Application provided on [Insert
Date(s)] by the Company to the Investor on or prior to
the date hereof, with respect to the covenants set forth in Section 4.1(d)(i)(B) and
Section 4.1(d)(i)(D) of the Standard Terms remains true, correct and
complete as of the date hereof.

 

UST Sequence Number: 318

 

F-1

 

4.                                       The contracts
and material agreements entered into by each Certified Entity with respect to
Development Services previously disclosed to the Investor remain in effect   and copies of any new contracts and material
agreements entered into by the Certified Entity with respect to Development
Services are attached hereto as Exhibit A.

 

5.                                       Attached hereto
as Exhibit B is (A) a list of the names and addresses of the
individuals which comprise the board of directors of each Certified Entity as
of the date hereof, (B) to the extent any member of the board of directors
listed on Exhibit B was not a member of the board of directors as of the
last certification provided to the Investor pursuant to Section 4.1(d)(ii) of
the Standard Terms, a narrative describing such individual’s relationship to
the applicable Investment Area(s) and Targeted Population(s) and (C) to
the extent any Certified Entity maintains accountability to residents of the
applicable Investment Area(s) or Target Population(s) through means
other than representation on its governing board of directors and such means
have changed since the date of the last certification provided to the Investor
pursuant to Section 4.1(d)(ii) of the Standard Terms on [Insert Date], a narrative
describing such change.

 

6.                                       Each Certified
Entity is not an agency of the United States of America, or any State or
political subdivision thereof, as described in 12 C.F.R. 1805.201(b)(6) and
within the meaning of any supplemental regulations or interpretations of 12
C.F.R. 1805.201(b)(6) or such supplemental regulations published by the
Fund.

 

7.                                       [Insert if the Company was a Bank Holding Company or a Savings and Loan
Holding Company on the Signing Date: The Company is and has
been at all times since the date of the last certification provided to the
Investor pursuant to Section 4.1(d)(ii) of the Standard Terms, a [Insert if the Company is a Bank Holding Company:
Bank Holding Company] [Insert if
the Company is a Savings and Loan Holding Company:
Savings and Loan Holding Company].] The Company is not, and has not been at any time since the
date of the last certification provided to the Investor pursuant to Section 4.1(d)(ii) of
the Standard Terms on [Insert Date],
controlled (within the meaning of [Insert for
banks and Bank Holding Companies: the Bank Holding
Company Act of 1956 (12 U.S.C. 1841(a)(2)) and 12 C.F.R. 225(a)(i)] [Insert for savings
associations and Savings and Loan Holding Companies: the Home
Owners’ Loan Act of 1933 (12 U.S.C. 1467a (a)(2)) and 12 C.F.R. 583.7]) by a foreign bank or company.

 

The
foregoing certifications are made and delivered as of [                  ] pursuant to Section 4.1(d)(ii) of the Standard
Terms.

 

Capitalized
terms used and not otherwise defined herein shall have the meanings assigned to
them in the Standard Terms.

 

[SIGNATURE PAGE FOLLOWS]

 

F-2

 

IN
WITNESS WHEREOF, this Officer’s Certificate has been duly executed and
delivered as of the [    ] day of [                    ], 20[    ].

 

	
   

  	
  [COMPANY]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

F-3

 

EXHIBIT A

 

NEW CONTRACTS AND MATERIAL AGREEMENTS

 

UST Sequence Number: 318

 

1

 

EXHIBIT B

 

BOARD OF DIRECTORS

 

CERTIFIED
ENTITY: [CERTIFIED ENTITY](1)

 

	
  NAME

  	
   

  	
  ADDRESS

  	
   

  	
  NARRATIVE(2)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

(1)  Include chart for each Certified Entity.

(2)  To the extent (x) any of the individuals
was not a member of the board of directors of such Certified Entity as of the
last certification to the Investor, include a narrative describing such
individual’s relationship to the applicable Investment Area(s) and
Targeted Population(s) or, (y) if such Certified Entity maintains
accountability to residents of the applicable Investment Area(s) or Target
Population(s) through means other than representation on its governing
board of directors and such means have changed since the date of the last
certification to the Investor, a narrative describing such change.

 

Letter Agreement · Exhibit
A                 UST
Sequence Number:  318

 

 

SCHEDULE  A

 

ADDITIONAL TERMS AND CONDITIONS

 

Company
Information:

 

Name
of the Company:  Citizens
Bancshares Corporation

 

Corporate
or other organizational form:  C Corporation

 

Jurisdiction
of Organization:  Georgia

 

Appropriate
Federal Banking Agency of Company:  Board of Governors of the Federal Reserve System

 

Names
of Certified Entities:     Citizens Bancshares Corporation

 

Jurisdiction
of Organization of Certified Entities:  Georgia

 

Appropriate
Federal Banking Agency of Certified Entities: 
Board of Governors of the Federal Reserve System

 

	
  Notice
  Information:

  	
  With
  Copy To:

  
	
   

  	
   

  	
   

  
	
  James E. Young

  President and Chief Executive Officer

  Citizens Bancshares Corporation

  75 Piedmont Avenue, SE

  Atlanta, GA 
  30303

  	
   

  	
  Beth
  Lanier, Esq.

  Bryan
  Cave LLP

  1201
  West Peachtree Street, SW, Suite 1400

  Atlanta,
  GA  30309

  

 

Terms
of the Exchange:

 

Series of
CDCI Preferred Stock Exchanged:  Fixed Rate Cumulative Perpetual Preferred Stock, Series B

 

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

 

Number
of Shares of CDCI Preferred Stock Exchanged: 
7,462

 

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

 

Series of
CPP Preferred Stock Exchanged:  Fixed Rate Cumulative Perpetual Preferred Stock, Series A

 

Number
of Shares of CPP Preferred Stock Exchanged: 
7,462

 

Date
of Letter Agreement pursuant to which CPP Preferred Shares were purchased:  March 6, 2009

 

	
  Letter Agreement · Schedule A

  	
  UST Sequence Number:  318

  

 

 

Closing:

 

	
  Location of Closing:

  	
  Cadwalader,
  Wickersham & Taft LLP

  
	
   

  	
  One
  World Financial Center

  
	
   

  	
  New
  York, NY 10281

  

 

Time
of Closing:  12:00 Noon

 

Date
of Closing: August 13, 2010

 

2

 

SCHEDULE B

 

CAPITALIZATION

 

Capitalization
Date:  July 30,
2010

 

Common
Stock

 

Par
value:  $1.00

 

Total
Authorized:  20,000,000

 

Outstanding:  2,026,124 (1)

 

Subject
to warrants, options, convertible securities, etc.:  120,003 (2)

 

Reserved
for benefit plans and other issuances:  215,107 (3)

 

Remaining
authorized but unissued:  17,973,876

 

Shares
issued after Capitalization Date (other than pursuant to warrants, options,
convertible securities, etc. as set forth above):  None

 

Preferred
Stock

 

Par
value:  None

 

Total
Authorized:  10,000,000

 

Outstanding
(by series):  7,462
shares  (Fixed Rate
Cumulative Perpetual Preferred Stock, Series A)

 

Reserved
for issuance:  None

 

Remaining
authorized but unissued:  9,992,538

 

	
  Holders
  of 5% or more of any class of capital stock

  	
   

  	
  Primary Address

  
	
   

  	
   

  	
   

  
	
  REDACTED

  	
   

  	
   

  

 

(1)  Does not include 90,000
shares of non-voting common stock, $1.00 par value, held by one shareholder.

(2)  Includes options granted
(exercisable and non-exercisable) pursuant to vesting schedule.

(3)  Includes options authorized and reserved, but not granted.

 

 

SCHEDULE C

 

MATERIAL ADVERSE EFFECT

 

List any exceptions to the representation and warranty

in Section 3.6 of the Exchange Agreement — Standard Terms.

 

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

 

 

SCHEDULE D

 

LITIGATION

 

List any exceptions to the representation and warranty

in Section 3.10 of the Exchange Agreement — Standard Terms.

 

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

 

 

SCHEDULE E

 

COMPLIANCE WITH LAWS

 

List any exceptions to the representation and warranty in the

second sentence of Section 3.11 of the Exchange Agreement—
Standard Terms.

 

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

 

List any exceptions to the representation and warranty in the

last sentence of Section 3.11 of the Exchange Agreement — Standard
Terms.

 

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

 

 

SCHEDULE F

 

REGULATORY AGREEMENTS

 

List any exceptions to the representation and warranty in

Section 3.17 of the Exchange Agreement — Standard Terms.

 

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

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