Document:

THE
MAINSTAY FUNDS

    AGREEMENT
AND PLAN OF REORGANIZATION

    MAINSTAY
SMALL CAP VALUE FUND

    MAINSTAY
SMALL CAP OPPORTUNITY FUND

    

    The
Boards of Trustees of Eclipse Funds and The MainStay Funds, each a Massachusetts
business trust (“Boards of Trustees”), deem it advisable that the MainStay Small
Cap Opportunity Fund (the “Acquiring Fund”) and the MainStay Small Cap Value
Fund (the “Acquired Fund”), a series of Eclipse Funds and The MainStay Funds,
respectively, engage in the reorganization described below.

    

    This
Agreement is intended to be and is adopted as a plan of reorganization and
liquidation (“Plan”) within the meaning of Section 368(a)(1) of the United
States Internal Revenue Code of 1986, as amended (“Code”). The reorganization
and liquidation will consist of the transfer of all of the assets of the
Acquired Fund to the Acquiring Fund in exchange solely for Investor Class, Class
A, Class B, Class C and Class I shares of beneficial interest of the Acquiring
Fund (“Acquiring Fund Shares”), the assumption by the Acquiring Fund of all
liabilities of the Acquired Fund, and the distribution of the Acquiring Fund
Shares to the shareholders of the Acquired Fund in complete liquidation of the
Acquired Fund, as provided herein (“Reorganization”), all upon the terms and
conditions hereinafter set forth in this Agreement.

    

    WHEREAS,
the Acquired Fund and the Acquiring Fund are each a series of an open-end,
registered investment company of the management type and the Acquired Fund owns
securities that generally are assets of the character in which the Acquiring
Fund is permitted to invest;

    

    WHEREAS,
the Board of Trustees of Eclipse Funds has determined, with respect to the
Acquiring Fund, that the exchange of all of the assets of the Acquired Fund for
Acquiring Fund Shares and the assumption of all liabilities of the Acquired Fund
by the Acquiring Fund is in the best interests of the Acquiring Fund and its
shareholders and that the interests of the existing shareholders of the
Acquiring Fund would not be diluted as a result of this transaction;
and

    

    WHEREAS,
the Board of Trustees of The MainStay Funds has determined, with respect to the
Acquired Fund, that the exchange of all of the assets of the Acquired Fund for
Acquiring Fund Shares and the assumption of all liabilities of the Acquired Fund
by the Acquiring Fund is in the best interests of the Acquired Fund and its
shareholders and that the interests of the existing shareholders of the Acquired
Fund would not be diluted as a result of this transaction;

    

    WHEREAS,
the Boards of Trustees of the Acquiring Fund and the Acquired Fund have agreed
that the proposed reorganization be contingent upon the approval by the
shareholders of the Acquiring Fund of MacKay Shields LLC, an affiliate of New
York Life Investment Management LLC (“New York Life Investments”), as
subadvisor.

    

    NOW,
THEREFORE, in consideration of the premises and of the covenants and agreements
hereinafter set forth, the parties hereto covenant and agree as
follows:

    

    
      	
              1.

            	
              Transfer
      of Assets of the Acquired Fund to the Acquiring Fund in Exchange for
      Acquiring Fund Shares, the Assumption of all Acquired Fund Liabilities and
      the Liquidation of the Acquired
Fund

            

    

    

    
      
         

      

      
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    1.1           Subject
to the requisite approval of the Acquired Fund’s shareholders and the other
terms and conditions herein set forth and on the basis of the representations
and warranties contained herein, the Acquired Fund agrees to transfer all of its
respective assets, as set forth in paragraph 1.2, to the Acquiring Fund, and the
Acquiring Fund agrees in exchange therefore:  (i) to deliver to the
Acquired Fund the number of full and fractional Investor Class, Class A, Class
B, Class C and Class I Acquiring Fund Shares, determined by dividing the value
of the Acquired Fund’s net assets with respect to each corresponding class
(Investor Class, Class A, Class B, Class C and Class I, respectively), computed
in the manner and as of the time and date set forth in paragraph 2.1, by the net
asset value of one Acquiring Fund Share of the corresponding class, computed in
the manner and as of the time and date set forth in paragraph 2.2; and (ii) to
assume all liabilities of the Acquired Fund, as set forth in paragraph
1.3.  Such transactions shall take place on the date of the closing
provided for in paragraph 3.1 (“Closing Date”).

    

    1.2           The
assets of the Acquired Fund to be acquired by the Acquiring Fund shall consist
of all assets and property, including, without limitation, all cash, securities,
commodities and futures interests and dividends or interests receivable that are
owned by the Acquired Fund and any deferred or prepaid expenses shown as an
asset on the books of the Acquired Fund on the Closing Date (collectively,
“Assets”).

    

    1.3           The
Acquired Fund will endeavor to discharge all of its liabilities and obligations
prior to the Closing Date.  The Acquiring Fund shall also assume all
of the liabilities of the Acquired Fund, whether accrued or contingent, known or
unknown, existing at the Valuation Date as defined in paragraph 2.1
(collectively, “Liabilities”).  On or as soon as practicable prior to
the Closing Date, the Acquired Fund will declare and pay to its shareholders of
record one or more dividends and/or other distributions so that it will have
distributed substantially all (and in no event less than 98%) of its investment
company taxable income (computed without regard to any deduction for dividends
paid) and realized net capital gain, if any, for the current taxable year
through the Closing Date.

    

    1.4           Immediately
after the transfer of assets provided for in paragraph 1.1, the Acquired Fund
will distribute to its respective shareholders of record with respect to each
class of shares, determined as of immediately after the close of business on the
Closing Date (“Acquired Fund Shareholders”), on a pro rata basis within that
class, the Acquiring Fund Shares of the corresponding class received by the
Acquired Fund pursuant to paragraph 1.1, and will completely liquidate. Such
distribution and liquidation will be accomplished, with respect to each class of
the Acquired Fund’s shares, by the transfer of the Acquiring Fund Shares then
credited to the account of the Acquired Fund on the books of the Acquiring Fund
to open accounts on the share records of the Acquiring Fund in the names of the
Acquired Fund Shareholders. The aggregate net asset value of Investor Class,
Class A, Class B, Class C and Class I Acquiring Fund Shares to be so credited to
Investor Class, Class A, Class B, Class C and Class I Acquired Fund
Shareholders, respectively, shall, with respect to each class, be equal to the
aggregate net asset value of the shares of beneficial interest of the Acquired
Fund (“Acquired Fund Shares”) of the corresponding class owned by Acquired Fund
Shareholders on the Closing Date.  All issued and outstanding shares
of the Acquired Fund will simultaneously be redeemed and canceled on the books
of the Acquired Fund, although share certificates representing interests in
Investor Class, Class A, Class B, Class C and Class I shares of the Acquired
Fund will represent a number of the corresponding class of Acquiring Fund Shares
after the Closing Date, as determined in accordance with paragraph
2.3.  The Acquiring Fund shall not issue certificates representing the
Investor Class, Class A, Class B, Class C and Class I Acquiring Fund Shares in
connection with such exchange.

    
      
         

      

      
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    1.5           Ownership
of Acquiring Fund Shares will be shown on the books of the Acquiring Fund’s
Transfer Agent, as defined in paragraph 3.3.

    

    1.6           Any
reporting responsibility of the Acquired Fund, including, but not limited to,
the responsibility for filing regulatory reports, tax returns, or other
documents with the Securities and Exchange Commission (“Commission”), any state
securities commission, and any Federal, state or local tax authorities or any
other relevant regulatory authority, is and shall remain the responsibility of
the Acquired Fund up to and including the Closing Date.

    

    2.           Valuation

    

    2.1           The
value of the Assets shall be the value of such Assets computed as of immediately
after the close of business of the New York Stock Exchange and after the
declaration of any dividends on the Closing Date (such time and date being
hereinafter called the “Valuation Date”), using the valuation procedures set
forth in the then-current prospectus and statement of additional information
with respect to the Acquired Fund, and valuation procedures established by the
Acquired Fund’s Board of Trustees.

    

    2.2           The
net asset value of an Acquiring Fund Share shall be the net asset value per
share computed with respect to that class as of the Valuation Date, using the
valuation procedures set forth in the Acquiring Fund’s then-current prospectus
and statement of additional information, and valuation procedures established by
the Acquiring Fund’s Board of Trustees.

    

    2.3           The
number of the Investor Class, Class A, Class B, Class C and Class I Acquiring
Fund Shares to be issued (including fractional shares, if any) in exchange for
the Acquired Fund’s Assets shall be determined with respect to each such class
by dividing the value of the net assets with respect to the Investor Class,
Class A, Class B, Class C and Class I of the Acquired Fund, as the case may be,
determined using the same valuation procedures referred to in paragraph 2.1, by
the net asset value of an Acquiring Fund Share of the same class, determined in
accordance with paragraph 2.2.

    

    2.4           All
computations of value shall be made by New York Life Investments, in its
capacity as administrator for the Acquired Fund and the Acquiring Fund, and
shall be subject to confirmation by each Fund’s record keeping agent and by each
Fund’s independent accountants.

    

    3.           Closing
and Closing Date

    

    3.1           The
Closing Date shall be February 13, 2009 or such other date as the parties may
agree. All acts taking place at the closing of the transactions provided for in
this Agreement (“Closing”) shall be deemed to take place simultaneously as of
immediately after the close of business on the Closing Date unless otherwise
agreed to by the parties.  The close of business on the Closing Date
shall be as of 4:00 pm, Eastern time.  The Closing shall be held at
the offices of the Funds or at such other time and/or place as the parties may
agree.

    

    3.2           The
MainStay Funds shall direct State Street Bank and Trust Company as custodian for
the Acquired Fund (“Custodian”), to deliver, at the Closing, a certificate of an
authorized officer stating that (i) the Assets shall have been delivered in
proper form to the Acquiring Fund within two business days prior to or on the
Closing Date, and (ii) all necessary taxes in connection with the delivery of
the Assets, including all applicable Federal and state stock transfer stamps, if
any, have been paid or provision for payment has been made.  The
Acquired Fund’s portfolio securities represented by a certificate or other
written instrument shall be presented by the Custodian to those persons at the
Custodian who have primary responsibility for the safekeeping of the assets of
the Acquiring Fund, which Custodian also serves as the custodian for the
Acquiring Fund.  Such presentation shall be made for examination no
later than five business days preceding the Closing Date, and shall be
transferred and delivered by the Acquired Fund as of the Closing Date for the
account of the Acquiring Fund duly endorsed in proper form for transfer in such
condition as to constitute good delivery thereof. The Custodian shall deliver to
those persons at the Custodian who have primary responsibility for the
safekeeping of the assets of the Acquiring Fund as of the Closing Date by book
entry, in accordance with the customary practices of the Custodian and of each
securities depository, as defined in Rule 17f-4 under the Investment Company Act
of 1940, as amended (“1940 Act”), in which the Acquired Fund’s Assets are
deposited, the Acquired Fund’s Assets deposited with such
depositories.  The cash to be transferred by the Acquired Fund shall
be delivered by wire transfer of Federal funds on the Closing
Date.

    
      
         

      

      
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    3.3           The
MainStay Funds shall direct NYLIM Service Company, LLC, in its capacity as
transfer agent for the Acquired Fund (“Transfer Agent”), to deliver at the
Closing a certificate of an authorized officer stating that its records contain
the names and addresses of the Acquired Fund Shareholders and the number and
percentage ownership of outstanding Investor Class, Class A, Class B, Class C
and Class I shares owned by each such shareholder immediately prior to the
Closing.  The Acquiring Fund shall issue and deliver to the Secretary
of the Acquired Fund prior to the Closing Date a confirmation evidencing that
the appropriate number of Acquiring Fund Shares will be credited to the Acquired
Fund on the Closing Date, or provide other evidence satisfactory to the Acquired
Fund as of the Closing Date that such Acquiring Fund Shares have been credited
to the Acquired Fund’s accounts on the books of the Acquiring
Fund.  At the Closing each party shall deliver to the other such bills
of sale, checks, assignments, share certificates, if any, receipts or other
documents as such other party or its counsel may reasonably
request.

    

    3.4           In
the event that on the Valuation Date (a) the New York Stock Exchange or another
primary trading market for portfolio securities of the Acquiring Fund or the
Acquired Fund (each, an “Exchange”) shall be closed to trading or trading
thereupon shall be restricted, or (b) trading or the reporting of trading on
such Exchange or elsewhere shall be disrupted so that, in the judgment of the
Boards of the Trusts, accurate appraisal of the value of the net assets of the
Acquired Fund or the Acquiring Fund is impracticable, the Closing Date shall be
postponed until the first business day after the day when trading shall have
been fully resumed and reporting shall have been restored.

    

    4.           Representations
and Warranties

    

    4.1           Except
as has been fully disclosed to the Acquiring Fund in a written instrument
executed by an officer of The MainStay Funds, The MainStay Funds, on behalf of
the Acquired Fund, represents and warrants to the Acquiring Fund, as
follows:

    

    (a)           The
Acquired Fund is duly organized as a series of The MainStay Funds, which is a
business trust duly organized, validly existing and in good standing under the
laws of Massachusetts, with power under The MainStay Funds’ Declaration of Trust
and By-Laws, as amended from time to time, to own all of its Assets and to carry
on its business as it is now being conducted;

    
      
         

      

      
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    (b)           The
MainStay Funds is a registered investment company classified as a management
company of the open-end type, and its registration with the Commission as an
investment company under the 1940 Act, and the registration of Investor Class,
Class A, Class B, Class C and Class I Acquired Fund Shares under the Securities
Act of 1933, as amended (“1933 Act”), is in full force and effect;

    

    (c)           No
consent, approval, authorization, or order of any court or governmental
authority is required for the consummation by the Acquired Fund of the
transactions contemplated herein, except such as have been obtained under the
1933 Act, the Securities Exchange Act of 1934, as amended (“1934 Act”), and the
1940 Act, and such as may be required by state securities laws;

    

    (d)           The
current prospectus and statement of additional information of the Acquired Fund
and each prospectus and statement of additional information of the Acquired Fund
used at all times prior to the date of this Agreement conforms or conformed at
the time of its use in all material respects to the applicable requirements of
the 1933 Act and the 1940 Act and the rules and regulations of the Commission
thereunder and does not or did not at the time of its use include any untrue
statement of a material fact or omit to state any 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 materially
misleading;

    

    (e)           On
the Closing Date, The MainStay Funds, on behalf of the Acquired Fund, will have
good and marketable title to the Assets and full right, power, and authority to
sell, assign, transfer and deliver such Assets hereunder free of any liens or
other encumbrances, and upon delivery and payment for such Assets, Eclipse
Funds, on behalf of the Acquiring Fund, will acquire good and marketable title
thereto, subject to no restrictions on the full transfer thereof, including such
restrictions as might arise under the 1933 Act, other than as disclosed to the
Acquiring Fund;

    

    (f)           The
MainStay Funds is not engaged currently, and the execution, delivery and
performance of this Agreement will not result, in (i) a material violation of
its Declaration of Trust or By-Laws, or of any agreement, indenture, instrument,
contract, lease or other undertaking to which The MainStay Funds, on behalf of
the Acquired Fund, is a party or by which it is bound, or (ii) the acceleration
of any obligation, or the imposition of any penalty, under any agreement,
indenture, instrument, contract, lease, judgment or decree to which The MainStay
Funds, on behalf of the Acquired Fund, is a party or by which it is
bound;

    

    (g)           All
material contracts or other commitments of the Acquired Fund (other than this
Agreement and certain investment contracts, including options, futures, and
forward contracts) will terminate without liability to the Acquired Fund on or
prior to the Closing Date;

    

    (h)           Except
as otherwise disclosed in writing to and accepted by Eclipse Funds, on behalf of
the Acquiring Fund, no litigation or administrative proceeding or investigation
of or before any court or governmental body is presently pending or, to its
knowledge, threatened against the Acquired Fund or any of its properties or
assets that, if adversely determined, would materially and adversely affect its
financial condition or the conduct of its business.  The MainStay
Funds, on behalf of the Acquired Fund, knows of no facts which might form the
basis for the institution of such proceedings and is not a party to or subject
to the provisions of any order, decree or judgment of any court or governmental
body which materially and adversely affects its business or its ability to
consummate the transactions herein contemplated;

    
      
         

      

      
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    (i)           The
Statement of Assets and Liabilities, Statements of Operations and Changes in Net
Assets, and Schedule of Investments of the Acquired Fund dated October 31,
2008 have been
audited by KPMG LLP, independent accountants, and are in accordance with
accounting principles generally accepted in the United States of America
(“GAAP”) consistently applied, and such statements (copies of which have been
furnished to the Acquiring Fund) present fairly, in all material respects, the
financial condition of the Acquired Fund as of such date in accordance with
GAAP, and there are no known contingent liabilities of the Acquired Fund
required to be reflected on a balance sheet (including the notes thereto) in
accordance with GAAP as of such date not disclosed therein;

    

    (j)           Since
October 31, 2008, there has not been any
material adverse change in the Acquired Fund’s financial condition, assets,
liabilities or business, other than changes occurring in the ordinary course of
business, or any incurrence by the Acquired Fund of indebtedness maturing more
than one year from the date such indebtedness was incurred, except as otherwise
disclosed to and accepted by the Acquiring Fund.  For the purposes of
this subparagraph (j), a decline in net asset value per share of Acquired Fund
Shares due to declines in market values of securities held by the Acquired Fund,
the discharge of the Acquired Fund’s liabilities, or the redemption of the
Acquired Fund’s shares by shareholders of the Acquired Fund shall not constitute
a material adverse change;

    

    (k)           On
the Closing Date, all Federal and other tax returns, dividend reporting forms,
and other tax-related reports of the Acquired Fund required by law to have been
filed by such date (including any extensions) shall have been filed and are or
will be correct in all material respects, and all Federal and other taxes shown
as due or required to be shown as due on said returns and reports shall have
been paid or provision shall have been made for the payment thereof, and to the
best of the Acquired Fund’s knowledge, no such return is currently under audit
and no assessment has been asserted with respect to such returns;

    

    (l)           For
each taxable year of its operation (including the taxable year ending on the
Closing Date), the Acquired Fund has met (or will meet) the requirements of
Subchapter M of the Code for qualification as a regulated investment company,
has been (or will be) eligible to and has computed (or will compute) its Federal
income tax under Section 852 of the Code, and will have distributed all of its
investment company taxable income and net capital gain (as defined in the Code)
that has accrued through the Closing Date, and before the Closing Date will have
declared dividends sufficient to distribute all of its investment company
taxable income and net capital gain for the period ending on the Closing
Date;

    

    
      
         

      

      
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    (m)           All
issued and outstanding shares of the Acquired Fund are, and on the Closing Date
will be, duly and validly issued and outstanding, fully paid and non-assessable
by the Trust and have been offered and sold in every state and the District of
Columbia in compliance in all material respects with applicable registration
requirements of the 1933 Act and state securities laws.  All of the
issued and outstanding shares of the Acquired Fund will, at the time of Closing,
be held by the persons and in the amounts set forth in the records of the
Transfer Agent, on behalf of the Acquired Fund, as provided in paragraph
3.3.  The Acquired Fund does not have outstanding any options,
warrants or other rights to subscribe for or purchase any of the shares of the
Acquired Fund, nor is there outstanding any security convertible into any of the
Acquired Fund’s shares;

    

    (n)           The
execution, delivery and performance of this Agreement will have been duly
authorized prior to the Closing Date by all necessary action, if any, on the
part of the Trustees of the Trust, on behalf of the Acquired Fund, and, subject
to the approval of the shareholders of the Acquired Fund, this Agreement will
constitute a valid and binding obligation of the Trust, on behalf of the
Acquired Fund, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization, moratorium and other
laws relating to or affecting creditors’ rights and to general equity
principles;

    

    (o)           The
information to be furnished by the Acquired Fund for use in registration
statements, proxy materials and other documents filed or to be filed with any
Federal, state or local regulatory authority (including the Financial Industry
Regulatory Association (“FINRA”)), which may be necessary in connection with the
transactions contemplated hereby, shall be accurate and complete in all material
respects and shall comply in all material respects with Federal securities and
other laws and regulations thereunder applicable thereto; and

    

    (p)           The
combined proxy statement and prospectus (“Proxy Statement”) to be included in
the Registration Statement referred to in paragraph 5.6, insofar as it relates
to the Acquired Fund, will, on the effective date of the Registration Statement
and on the Closing Date (i) not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which such
statements were made, not materially misleading, provided, however, that the
representations and warranties of this subparagraph (p) shall not apply to
statements in or omissions from the Proxy Statement and the Registration
Statement made in reliance upon and in conformity with information that was
furnished by the Acquiring Fund for use therein, and (ii) comply in all material
respects with the provisions of the 1933 Act, the 1934 Act, and the 1940 Act and
the rules and regulations thereunder.

    

    4.2           Except
as has been fully disclosed to the Acquired Fund in a written instrument
executed by an officer of Eclipse Funds, on behalf of the Acquiring Fund,
represents and warrants to the Acquired Fund, as follows:

    

    (a)           The
Acquiring Fund is duly organized as series of Eclipse Funds, which is a trust
duly organized, validly existing, and in good standing under the laws of the
Massachusetts with power under its Declaration of Trust and By-Laws to own all
of its properties and assets and to carry on its business as it is now being
conducted;

    

    
      
         

      

      
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    (b)           The
Eclipse Funds is a registered investment company classified as a management
company of the open-end type, and its registration with the Commission as an
investment company under the 1940 Act and the registration of the Investor
Class, Class A, Class B, Class C and Class I Acquiring Fund Shares under the
1933 Act, is in full force and effect;

    

    (c)           No
consent, approval, authorization, or order of any court or governmental
authority is required for the consummation by the Acquiring Fund of the
transactions contemplated herein, except such as have been obtained under the
1933 Act, the 1934 Act and the 1940 Act and such as may be required by state
securities laws;

    

    (d)           The
current prospectus and statement of additional information of the Acquiring Fund
and each prospectus and statement of additional information of the Acquiring
Fund used at all times prior to the date of this Agreement conforms or conformed
at the time of its use in all material respects to the applicable requirements
of the 1933 Act and the 1940 Act and the rules and regulations of the Commission
thereunder and does not or did not at the time of its use include any untrue
statement of a material fact or omit to state any 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 materially
misleading;

    

    (e)           On
the Closing Date, Eclipse Funds, on behalf of the Acquiring Fund, will have good
and marketable title to the Acquiring Fund’s assets, free of any liens or other
encumbrances, except those liens or encumbrances as to which the Acquired Fund
has received notice and necessary documentation at or prior to the
Closing;

    

    (f)           The
Acquiring Fund is not engaged currently, and the execution, delivery and
performance of this Agreement will not result, in (i) a material violation of
Eclipse Funds’ Declaration of Trust or By-Laws or of any agreement, indenture,
instrument, contract, lease or other undertaking to which Eclipse Funds, on
behalf of the Acquiring Fund, is a party or by which it is bound, or (ii) the
acceleration of any obligation, or the imposition of any penalty, under any
agreement, indenture, instrument, contract, lease, judgment or decree to which
Eclipse Funds, on behalf of the Acquiring Fund, is a party or by which it is
bound;

    

    (g)           Except
as otherwise disclosed in writing to and accepted by The MainStay Funds, on
behalf of the Acquired Fund, no litigation or administrative proceeding or
investigation of or before any court or governmental body is presently pending
or, to the Acquiring Fund’s knowledge, threatened against Eclipse Funds, on
behalf of the Acquiring Fund, or any of the Acquiring Fund’s properties or
assets that, if adversely determined, would materially and adversely affect the
Acquiring Fund’s financial condition or the conduct of its
business.  Eclipse Funds, on behalf of the Acquiring Fund, knows of no
facts which might form the basis for the institution of such proceedings and is
not a party to or subject to the provisions of any order, decree or judgment of
any court or governmental body which materially and adversely affects the
Acquiring Fund’s business or its ability to consummate the transactions herein
contemplated;

    

    (h)           The
Statement of Assets and Liabilities, Statements of Operations and Changes in Net
Assets and Schedule of Investments of the Acquiring Fund dated October 31,
2008 have been
audited by KPMG LLP, independent accountants, and are in accordance with GAAP
consistently applied, and such statements (copies of which have been furnished
to the Acquired Fund) present fairly, in all material respects, the financial
condition of the Acquiring Fund as of such date in accordance with GAAP, and
there are no known contingent liabilities of the Acquiring Fund required to be
reflected on a balance sheet (including the notes thereto) in accordance with
GAAP as of such date not disclosed therein;

    
      
         

      

      
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    (i)           Since
October 31, 2008, there has not been any
material adverse change in the Acquiring Fund’s financial condition, assets,
liabilities or business, other than changes occurring in the ordinary course of
business, or any incurrence by the Acquiring Fund of indebtedness maturing more
than one year from the date such indebtedness was incurred, except as otherwise
disclosed to and accepted by the Acquired Fund.  For purposes of this
subparagraph (i), a decline in net asset value per share of the Acquiring Fund’s
shares due to declines in market values of securities held by the Acquiring
Fund, the discharge of the Acquiring Fund’s liabilities, or the redemption of
the Acquiring Fund’s shares by shareholders of the Acquiring Fund, shall not
constitute a material adverse change;

    

    (j)           On
the Closing Date, all Federal and other tax returns, dividend reporting forms,
and other tax-related reports of the Acquiring Fund required by law to have been
filed by such date (including any extensions) shall have been filed and are or
will be correct in all material respects, and all Federal and other taxes shown
as due or required to be shown as due on said returns and reports shall have
been paid or provision shall have been made for the payment thereof, and to the
best of the Acquiring Fund’s knowledge no such return is currently under audit
and no assessment has been asserted with respect to such returns;

    

    (k)           For
each taxable year of its operation (including the taxable year that includes the
Closing Date), the Acquiring Fund has met (or will meet) the requirements of
Subchapter M of the Code for qualification as a regulated investment company,
has been eligible to (or will be eligible to) and has computed (or will compute)
its Federal income tax under Section 852 of the Code, and has distributed all of
its investment company taxable income and net capital gain (as defined in the
Code) for periods ending prior to the Closing Date;

    

    (l)           All
issued and outstanding Acquiring Fund Shares are, and on the Closing Date will
be, duly and validly issued and outstanding, fully paid and non-assessable by
the Trust and have been offered and sold in every state and the District of
Columbia in compliance in all material respects with applicable registration
requirements of the 1933 Act and state securities laws.  The Acquiring
Fund does not have outstanding any options, warrants or other rights to
subscribe for or purchase any Acquiring Fund Shares, nor is there outstanding
any security convertible into any Acquiring Fund Shares;

    

    (m)           The
execution, delivery and performance of this Agreement will have been duly
authorized prior to the Closing Date by all necessary action, if any, on the
part of the Board of Trustees of Eclipse Funds, on behalf of the Acquiring Fund,
and this Agreement will constitute a valid and binding obligation of the
Acquiring Fund, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization, moratorium and other
laws relating to or affecting creditors’ rights and to general equity
principles;

    

    (n)           The
Investor Class, Class A, Class B, Class C and Class I Acquiring Fund Shares to
be issued and delivered to the Acquired Fund, for the account of the Acquired
Fund Shareholders, pursuant to the terms of this Agreement, will on the Closing
Date have been duly authorized and, when so issued and delivered, will be duly
and validly issued Acquiring Fund Shares, and will be fully paid and
nonassessable by the Acquiring Fund; and

    

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    (o)           The
information to be furnished by the Acquiring Fund for use in the registration
statements, proxy materials and other documents that may be necessary in
connection with the transactions contemplated hereby shall be accurate and
complete in all material respects and shall comply in all material respects with
Federal securities and other laws and regulations applicable thereto;
and

    

    (p)           The
Proxy Statement to be included in the Registration Statement (and any amendment
or supplement thereto), insofar as it relates to the Acquiring Fund and the
Acquiring Fund Shares, will, from the effective date of the Registration
Statement through the date of the Special Meeting of shareholders of the
Acquired Fund contemplated therein and on the Closing Date (i) not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which such statements were made, not materially misleading,
provided, however, that the representations and warranties of this subparagraph
(p) shall not apply to statements in or omissions from the Proxy Statement and
the Registration Statement made in reliance upon and in conformity with
information that was furnished by the Acquired Fund for use therein, and
(ii) comply in all material respects with the provisions of the 1933 Act,
the 1934 Act, and the 1940 Act and the rules and regulations
thereunder.

    

    5.           Covenants
of the Acquiring Fund and the Acquired Fund

    

    5.1           The
Acquiring Fund and the Acquired Fund each will operate its business in the
ordinary course between the date hereof and the Closing Date, it being
understood that such ordinary course of business will include the declaration
and payment of customary dividends and distributions, and any other distribution
that may be advisable.

    

    5.2           The
MainStay Funds will call a Special Meeting of the shareholders of the Acquired
Fund to consider and act upon this Agreement and to take all other action
necessary to obtain approval of the transactions contemplated herein. Eclipse
Funds will call a meeting of the shareholders of the Acquiring Fund to approve
MacKay Shields LLC, an affiliate of New York Life Investments, as
subadvisor.

    

    5.3           The
Acquired Fund covenants that the Investor Class, Class A, Class B, Class C and
Class I Acquiring Fund Shares to be issued hereunder are not being acquired for
the purpose of making any distribution thereof, other than in accordance with
the terms of this Agreement.

    

    5.4           The
Acquired Fund will assist the Acquiring Fund in obtaining such information as
the Acquiring Fund reasonably requests concerning the beneficial ownership of
the Acquired Fund’s shares.

    

    5.5           Subject
to the provisions of this Agreement, the Acquiring Fund and the Acquired Fund
will each take, or cause to be taken, all action, and do or cause to be done all
things, reasonably necessary, proper or advisable to consummate and make
effective the transactions contemplated by this Agreement.

    

    5.6           The
Acquired Fund will provide the Acquiring Fund with information reasonably
necessary for the preparation of the Proxy Statement (referred to in paragraph
4.1(p)) to be included in a Registration Statement on Form N-14 (“Registration
Statement”), in compliance with the 1933 Act, the 1934 Act and the 1940 Act, in
connection with the Special Meeting of the shareholders of the Acquired Fund to
consider approval of this Agreement and the transactions contemplated
herein.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    

    5.7           As
soon as is reasonably practicable after the Closing, the Acquired Fund will make
a liquidating distribution to its respective shareholders consisting of the
Investor Class, Class A, Class B, Class C and Class I Acquiring Fund Shares
received at the Closing.

    

    5.8           The
Acquiring Fund and the Acquired Fund shall each use their reasonable best
efforts to fulfill or obtain the fulfillment of the conditions precedent to
effect the transactions contemplated by this Agreement as promptly as
practicable.

    

    5.9           The
MainStay Funds, on behalf of the Acquired Fund, covenants that it will, from
time to time, as and when reasonably requested by the Acquiring Fund, execute
and deliver or cause to be executed and delivered all such assignments and other
instruments, and will take or cause to be taken such further action as Eclipse
Funds, on behalf of the Acquiring Fund, may reasonably deem necessary or
desirable in order to vest in and confirm (a) The MainStay Funds’, on behalf of
the Acquired Fund, title to and possession of the Acquiring Fund Shares to be
delivered hereunder, and (b) Eclipse Funds’, on behalf of the Acquiring Fund,
title to and possession of all the Assets and otherwise to carry out the intent
and purpose of this Agreement.

    

    5.10           The
Acquiring Fund will use all reasonable efforts to obtain the approvals and
authorizations required by the 1933 Act, the 1940 Act and such of the state blue
sky or securities laws as may be necessary in order to continue its operations
after the Closing Date.

    

    6.           Conditions
Precedent to Obligations of the Acquired Fund

    

    The
obligations of The MainStay Funds, on behalf of the Acquired Fund, to consummate
the transactions provided for herein shall be subject, at The MainStay Funds’
election, to the performance by Eclipse Funds, on behalf of the Acquiring Fund,
of all the obligations to be performed by it hereunder on or before the Closing
Date, and, in addition thereto, the following further conditions:

    

    6.1           All
representations and warranties of Eclipse Funds, on behalf of the Acquiring
Fund, contained in this Agreement shall be true and correct in all material
respects as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date, with the
same force and effect as if made on and as of the Closing Date;

    

    6.2           Eclipse
Funds, on behalf of the Acquiring Fund, shall have delivered to the Acquired
Fund a certificate executed in the name of the Acquiring Fund by its President
or Vice President and its Treasurer or Assistant Treasurer, in a form reasonably
satisfactory to The MainStay Funds, and dated as of the Closing Date, to the
effect that the representations and warranties of Eclipse Funds, on behalf of
the Acquiring Fund, made in this Agreement are true and correct at and as of the
Closing Date, except as they may be affected by the transactions contemplated by
this Agreement, and as to such other matters as The MainStay Funds shall
reasonably request;

    

    6.3           Eclipse
Funds, on behalf of the Acquiring Fund, shall have performed all of the
covenants and complied with all of the provisions required by this Plan to be
performed or complied with by Eclipse Funds, on behalf of the Acquiring Fund, on
or before the Closing Date; and

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    6.4           The
Acquired Fund and the Acquiring Fund shall have agreed on the number of full and
fractional Investor Class, Class A, Class B, Class C and Class I Acquiring Fund
Shares to be issued in connection with the Reorganization after such number has
been calculated in accordance with paragraph 1.1.

    

    6.5           The
shareholders of the Acquiring Fund shall have approved MacKay Shields LLC as
subadvisor.

    

    7.           Conditions
Precedent to Obligations of the Acquiring Fund

    

    The
obligations of Eclipse Funds, on behalf of the Acquiring Fund, to complete the
transactions provided for herein shall be subject, at Eclipse Funds’ election,
to the performance by The MainStay Funds, on behalf of the Acquired Fund, of all
of the obligations to be performed by it hereunder on or before the Closing Date
and, in addition thereto, the following conditions:

    

    7.1           All
representations and warranties of The MainStay Funds, on behalf of the Acquired
Fund, contained in this Agreement shall be true and correct in all material
respects as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date, with the
same force and effect as if made on and as of the Closing Date;

    

    7.2           The
MainStay Funds shall have delivered to the Acquiring Fund a statement of the
Acquired Fund’s Assets and Liabilities, as of the Closing Date, certified by the
Treasurer of The MainStay Funds;

    

    7.3           The
MainStay Funds, on behalf of the Acquired Fund, shall have delivered to the
Acquiring Fund a certificate executed in the name of the Acquired Fund by its
President or Vice President and its Treasurer or Assistant Treasurer, in a form
reasonably satisfactory to the Acquiring Fund and dated as of the Closing Date,
to the effect that the representations and warranties of The MainStay Funds, on
behalf of the Acquired Fund, made in this Agreement are true and correct at and
as of the Closing Date, except as they may be affected by the transactions
contemplated by this Agreement, and as to such other matters as Eclipse Funds
shall reasonably request;

    

    7.4           The
MainStay Funds, on behalf of the Acquired Fund, shall have performed all of the
covenants and complied with all of the provisions required by this Agreement to
be performed or complied with by The MainStay Funds, on behalf of the Acquired
Fund, on or before the Closing Date;

    

    7.5           The
Acquired Fund and the Acquiring Fund shall have agreed on the number of full and
fractional Investor Class, Class A, Class B, Class C and Class I Acquiring Fund
Shares to be issued in connection with the Reorganization after such number has
been calculated in accordance with paragraph 1.1; and

    

    7.6           The
Acquired Fund shall have declared and paid a distribution or distributions prior
to the Closing that, together with all previous distributions, shall have the
effect of distributing to its shareholders (i) all of their investment company
taxable income and all of their net realized capital gains, if any, for the
period from the close of its last fiscal year to 4:00 pm Eastern time on the
Closing Date; and (ii) any undistributed investment company taxable income and
net realized capital gains from any period to the extent not otherwise already
distributed.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    

    7.7           The
shareholders of the Acquiring Fund shall have approved MacKay Shields LLC as
subadvisor.

    

    
      	
              8.

            	
              Further
      Conditions Precedent to Obligations of the Acquiring Fund and the Acquired
      Fund

            

    

    

    If any of
the conditions set forth below have not been satisfied on or before the Closing
Date with respect to The MainStay Funds, on behalf of the Acquired Fund, or
Eclipse Funds, on behalf of the Acquiring Fund, the other party to this
Agreement shall, at its option, not be required to consummate the transactions
contemplated by this Agreement:

    

    8.1           The
Agreement and the transactions contemplated herein shall have been approved by
the requisite vote of the holders of the outstanding shares of the Acquired Fund
in accordance with the provisions of The MainStay Funds’ Declaration of Trust
and By-Laws, applicable Massachusetts law and the 1940 Act, and certified copies
of the resolutions evidencing such approval shall have been delivered to the
Acquiring Fund. Notwithstanding anything herein to the contrary, The MainStay
Funds and Eclipse Funds, on behalf of either the Acquired Fund or the Acquiring
Fund, respectively, may not waive the conditions set forth in this paragraph
8.1;

    

    8.2           On
the Closing Date no action, suit or other proceeding shall be pending or, to
Eclipse Funds’ or The MainStay Funds’ knowledge, threatened before any court or
governmental agency in which it is sought to restrain or prohibit, or obtain
damages or other relief in connection with, this Agreement or the transactions
contemplated herein;

    

    8.3           All
consents of other parties and all other consents, orders and permits of Federal,
state and local regulatory authorities deemed necessary by Eclipse Funds and The
Mainstay Funds to permit consummation, in all material respects, of the
transactions contemplated hereby shall have been obtained, except where failure
to obtain any such consent, order or permit would not involve a risk of a
material adverse effect on the assets or properties of the Acquiring Fund or the
Acquired Fund, provided that either party hereto may for itself waive any of
such conditions;

    

    8.4           The
Registration Statement shall have become effective under the 1933 Act and no
stop orders suspending the effectiveness thereof shall have been issued and, to
the best knowledge of the parties hereto, no investigation or proceeding for
that purpose shall have been instituted or be pending, threatened or
contemplated under the 1933 Act; and

    

    8.5           The
parties shall have received the opinion of counsel to The MainStay Funds, on
behalf of the Acquired Fund, substantially to the effect that, based upon
certain facts, assumptions, and representations, the transaction contemplated by
this Agreement shall constitute a tax free reorganization for Federal income tax
purposes.  The delivery of such opinion is conditioned upon receipt by
counsel to The MainStay Funds of representations it shall request of The
MainStay Funds.  Notwithstanding anything herein to the contrary, The
MainStay Funds and Eclipse Funds, on behalf of either the Acquired Fund or the
Acquiring Fund, respectively, may not waive the condition set forth in this
paragraph 8.5.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    

    9.           Indemnification

    

    9.1           Eclipse
Funds, out of the Acquiring Fund’s assets and property, agrees to indemnify and
hold harmless the Acquired Fund from and against any and all losses, claims,
damages, liabilities or expenses (including, without limitation, the payment of
reasonable legal fees and reasonable costs of investigation) to which the
Acquired Fund may become subject, insofar as such loss, claim, damage, liability
or expense (or actions with respect thereto) arises out of or is based on any
breach by the Acquiring Fund of any of its representations, warranties,
covenants or agreements set forth in this Agreement.

    

    9.2           The
MainStay Funds, out of the Acquired Fund’s assets and property, agrees to
indemnify and hold harmless the Acquiring Fund from and against any and all
losses, claims, damages, liabilities or expenses (including, without limitation,
the payment of reasonable legal fees and reasonable costs of investigation) to
which the Acquiring Fund may become subject, insofar as such loss, claim,
damage, liability or expense (or actions with respect thereto) arises out of or
is based on any breach by the Acquired Fund of any of its representations,
warranties, covenants or agreements set forth in this Agreement.

    

    10.           Brokerage
Fees and Expenses

    

    10.1           The
Acquiring Fund and the Acquired Fund, represent and warrant to each other that
there are no brokers or finders entitled to receive any payments in connection
with the transactions provided for herein.

    

    10.2           The
expenses relating to the proposed Reorganization will be borne by the Acquired
Fund.  No such expenses shall be borne by the Acquiring Fund, except
for brokerage fees and expenses incurred in connection with the
Reorganization.  The costs of the Reorganization shall include, but
not be limited to, costs associated with obtaining any necessary order of
exemption from the 1940 Act, if any, preparation of the Registration Statement,
printing and distributing the Proxy Statement, legal fees, accounting fees,
securities registration fees, and expenses of holding shareholders’ meetings.
Notwithstanding any of the foregoing, expenses will in any event be paid by the
party directly incurring such expenses if and to the extent that the payment by
another person of such expenses would result in the disqualification of such
party as a “regulated investment company” within the meaning of Section 851 of
the Code.

    

    11.           Entire
Agreement; Survival of Warranties

    

    11.1           Eclipse
Funds and The MainStay Funds agree that they have not made any representation,
warranty or covenant, on behalf of either the Acquiring Fund or the Acquired
Fund, respectively, not set forth herein and that this Agreement constitutes the
entire agreement between the parties.

    

    11.2           The
representations, warranties and covenants contained in this Agreement or in any
document delivered pursuant hereto or in connection herewith shall survive the
consummation of the transactions contemplated hereunder.  The
covenants to be performed after the Closing and the obligations of the Acquired
Fund and Acquiring Fund in Sections 9.1 and 9.2 shall survive the
Closing.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    

    12.           Termination

    

    This
Agreement may be terminated and the transactions contemplated hereby may be
abandoned by resolution of the Board of Trustees of Eclipse Funds and The
MainStay Funds, on behalf of either the Acquiring Fund or the Acquired Fund,
respectively, at any time prior to the Closing Date, if circumstances should
develop that, in the opinion of the Board, make proceeding with the Agreement
inadvisable.

    

    13.           Amendments

    

    This
Agreement may be amended, modified or supplemented in such manner as may be
deemed necessary or advisable by the authorized officers of Eclipse Funds and
The MainStay Funds, on behalf of either the Acquiring Fund or the Acquired Fund,
respectively; provided, however, that following the Special Meeting of the
shareholders of the Acquired Fund called by The MainStay Funds, pursuant to
paragraph 5.2 of this Agreement, no such amendment may have the effect of
changing the provisions for determining the number of Investor Class, Class A,
Class B, Class C and Class I Acquiring Fund Shares to be issued to the Investor
Class, Class A, Class B, Class C and Class I Acquired Fund Shareholders,
respectively, under this Agreement to the detriment of such shareholders without
their further approval.

    

    14.           Notices

    

    Any
notice, report, statement or demand required or permitted by any provisions of
this Agreement shall be in writing and shall be given by facsimile, electronic
delivery (i.e., e-mail)
personal service or prepaid or certified mail addressed to the Funds, 169
Lackawanna Avenue, Parsippany, New Jersey 07054, Attn: Marguerite E. H.
Morrison, in each case with a copy to Dechert LLP, 1775 I Street, N.W.,
Washington, D.C. 20006, Attn: Sander M. Bieber.

    

    15.           Headings;
Governing Law; Assignment; Limitation of Liability

    

    15.1           The
Article and paragraph headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.

    

    15.2           This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York without regard to its principles of conflicts of
laws.

    

    15.3           This
Agreement shall bind and inure to the benefit of the parties hereto and their
respective successors and assigns, but no assignment or transfer hereof or of
any rights or obligations hereunder shall be made by any party without the
written consent of the other party.  Nothing herein expressed or
implied is intended or shall be construed to confer upon or give any person,
firm or corporation, other than the parties hereto and their respective
successors and assigns, any rights or remedies under or by reason of this
Agreement. Except as expressly provided otherwise in this Plan, the Acquired
Fund will pay or cause to be paid all out-of pocket fees and expenses incurred
in connection with the transactions contemplated under this Plan, including, but
not limited to, accountants’ fees, legal fees, registration fees, printing
expenses, transfer taxes (if any) and the fees of banks and transfer
agents.

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, each of the parties hereto has caused this Plan to be executed
as of the 13th day of
February, 2009.

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        	 
      	
                                ECLIPSE
      FUNDS

                              
	 
      	
                                On
      behalf of the Acquiring Fund,

                              
	 
      	
                                Mainstay
      Small Cap Opportunity Fund

                              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                                By:

                              	
                                /s/ Stephen P. Fisher

                              
	 
      	 
      	
                                Stephen
      P. Fisher

                              
	 
      	 
      	
                                President

                              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                                THE
      MAINSTAY FUNDS

                              
	 
      	
                                On
      behalf of the Acquired Fund,

                              
	 
      	
                                Mainstay
      Small Cap Value Fund

                              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                                By:

                              	
                                /s/ Stephen P. Fisher

                              
	 
      	 
      	
                                Stephen
      P. Fisher

                              
	 
      	 
      	
                                President

                              

                      

                    

                  

                

              

            

          

        

      

    

    

     

    New York
Life Investment Management LLC agrees to the provisions set forth in the last
paragraph of this Plan.

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	 
      	
                                      NEW
      YORK LIFE INVESTMENT

                                    
	 
      	
                                      MANAGEMENT
      LLC

                                    
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                                      By:

                                    	
                                      /s/ Barry A. Schub

                                    
	 	 	Barry
      A. Schub
	 	 	Executive
      Vice
President

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    February
13, 2009

    

    
      	
              Board
      of Trustees

              The
      MainStay Funds

              MainStay
      Small Cap Value Fund

              51
      Madison Avenue

              New
      York, New York 10010

               

            
	
              Board
      of Trustees

              Eclipse
      Funds

              MainStay
      Small Cap Opportunity Fund

              51
      Madison Avenue

              New
      York, New York 10010

               

            

    

    

    Dear
Ladies and Gentlemen:

    

    You have
requested our opinion regarding certain federal income tax consequences to
MainStay Small Cap Value Fund (the “Acquired Fund”), a separate series of The
MainStay Funds, a Massachusetts business trust (the “MainStay Trust”), to the
holders of the shares of beneficial interest (the “Acquired Fund Shares”) of
Acquired Fund (the “Acquired Fund Shareholders”), and to MainStay Small Cap
Opportunity Fund (the “Acquiring Fund”), a separate series of Eclipse Funds, a
Massachusetts business trust (the “Eclipse Trust”), in connection with the
proposed transfer of substantially all of the properties of Acquired Fund to
Acquiring Fund in exchange solely for voting shares of beneficial interest of
Acquiring Fund (“Acquiring Fund Shares”) and the assumption of all liabilities
of Acquired Fund by Acquiring Fund, followed by the distribution of such
Acquiring Fund Shares received by Acquired Fund in complete liquidation and
termination of Acquired Fund (the “Reorganization”), all pursuant to the
Agreement and Plan of Reorganization (the “Plan”) dated as of February 13, 2009
executed by the MainStay Trust on behalf of the Acquired Fund and by the Eclipse
Trust on behalf of the Acquiring Fund.

     

    For
purposes of this opinion, we have examined and relied upon (1) the Plan, (2) the
Form N-14 filed by Acquiring Fund on October 2, 2008 with the Securities and
Exchange Commission and amended on November 6, 2008, (3) the related Proxy
Statement dated November 17, 2008, (4) the facts and representations contained
in the letter dated on or about the date hereof addressed to us from the Eclipse
Trust on behalf of Acquiring Fund, (5) the facts and representations contained
in the letter dated on or about the date hereof addressed to us from the
MainStay Trust on behalf of Acquired Fund, and (6) such other documents and
instruments as we have deemed necessary or appropriate for purposes of rendering
this opinion.

     

    This
opinion is based upon the Internal Revenue Code of 1986, as amended (the
“Code”), United States Treasury regulations, judicial decisions, and
administrative rulings and pronouncements of the Internal Revenue Service, all
as in effect on the date hereof.  This opinion is conditioned upon the
Reorganization taking place in the manner described in the Plan and the Form
N-14 referred to above.

     

    Based
upon the foregoing, it is our opinion that:

     

    
      	
              1.

            	
              The
      acquisition by Acquiring Fund of substantially all of the properties of
      Acquired Fund in exchange solely for Acquiring Fund Shares and the
      assumption of all liabilities of Acquired Fund by Acquiring Fund followed
      by the distribution of Acquiring Fund Shares to the Acquired Fund
      Shareholders in exchange for their Acquired Fund shares in complete
      liquidation and termination of Acquired Fund will constitute a tax-free
      reorganization under Section 368(a) of the
Code.

            

    

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    
      	
              2.

            	
              Acquired
      Fund will not recognize gain or loss upon the transfer of substantially
      all of its assets to Acquiring Fund in exchange solely for Acquiring Fund
      Shares except to the extent that Acquired Fund’s assets consist of
      contracts described in Section 1256(b) of the Code (“Section 1256
      Contracts”); Acquired Fund will be required to recognize gain or loss on
      the transfer of any such Section 1256 Contracts to Acquiring Fund pursuant
      to the Reorganization as if such Section 1256 Contracts were sold to
      Acquiring Fund on the effective date of the Reorganization at their fair
      market value.

            

    

     

    
      	
              3.

            	
              Acquired
      Fund will not recognize gain or loss upon the distribution to its
      shareholders of the Acquiring Fund Shares received by Acquired Fund in the
      Reorganization.

            

    

     

    
      	
              4.

            	
              Acquiring
      Fund will recognize no gain or loss upon receiving the properties of
      Acquired Fund in exchange solely for Acquiring Fund
  Shares.

            

    

     

    
      	
              5.

            	
              The
      adjusted basis to Acquiring Fund of the properties of Acquired Fund
      received by Acquiring Fund in the Reorganization will be the same as the
      adjusted basis of those properties in the hands of Acquired Fund
      immediately before the exchange.

            

    

     

    
      	
              6.

            	
              Acquiring
      Fund’s holding periods with respect to the properties of Acquired Fund
      that Acquiring Fund acquires in the transaction will include the
      respective periods for which those properties were held by Acquired Fund
      (except where investment activities of Acquiring Fund have the effect of
      reducing or eliminating a holding period with respect to an
      asset).

            

    

     

    
      	
              7.

            	
              The
      Acquired Fund Shareholders will recognize no gain or loss upon receiving
      Acquiring Fund Shares solely in exchange for Acquired Fund
      Shares.

            

    

     

    
      	
              8.

            	
              The
      basis of the Acquiring Fund Shares received by an Acquired Fund
      Shareholder in the transaction will be the same as the basis of Acquired
      Fund Shares surrendered by the Acquired Fund Shareholder in exchange
      therefor.

            

    

     

    
      	
              9.

            	
              An
      Acquired Fund Shareholder’s holding period for the Acquiring Fund Shares
      received by the Acquired Fund Shareholder in the transaction will include
      the holding period during which the Acquired Fund Shareholder held
      Acquired Fund Shares surrendered in exchange therefor, provided that the
      Acquired Fund Shareholder held such shares as a capital asset on the date
      of Reorganization.

            

    

     

    We
express no opinion as to the federal income tax consequences of the
Reorganization except as expressly set forth above, or as to any transaction
except those consummated in accordance with the Plan.

     

    Very
truly yours,

     

    /s/ Dechert
LLP

    

    

      
        
           

        

        
          2Exhibit
4.1

     

    AMENDED
AND RESTATED

     

    WARRANT
TO PURCHASE COMMON STOCK

     

    THE
SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION
STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR
SUCH LAWS. THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND
OTHER PROVISIONS OF A SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE
SECURITIES AND THE INVESTOR REFERRED TO THEREIN, A COPY OF WHICH IS ON FILE WITH
THE ISSUER. THE SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENT. ANY SALE OR
OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT WILL BE VOID.

     

    WARRANT

    to
purchase

    3,670,822

    Shares
of Common Stock

     

    of
First Place Financial Corp.

     

    Issue
Date: March 13, 2009

     

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

     

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

     

    “Appraisal Procedure” means a
procedure whereby two independent appraisers, one chosen by the Company and one
by the Original Warrantholder, shall mutually agree upon the determinations then
the subject of appraisal. Each party shall deliver a notice to the other
appointing its appraiser within 15 days after the Appraisal Procedure is
invoked. If within 30 days after appointment of the two appraisers they are
unable to agree upon the amount in question, a third independent appraiser shall
be chosen within 10 days thereafter by the mutual consent of such first two
appraisers. The decision of the third appraiser so appointed and chosen shall be
given within 30 days after the selection of such third appraiser. If three
appraisers shall be appointed and the determination of one appraiser is
disparate from the middle determination by more than twice the amount by which
the other determination is disparate from the middle determination, then the
determination of such appraiser shall be excluded, the remaining two
determinations shall be averaged and such average shall be binding and
conclusive upon the Company and the Original Warrantholder; otherwise, the
average of all three determinations shall be binding upon the Company and the
Original Warrantholder. The costs of conducting any Appraisal Procedure shall be
borne by the Company.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    “Board of Directors” means the
board of directors of the Company, including any duly authorized committee
thereof.

     

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

     

    “business day” means any day
except Saturday, Sunday and any day on which banking institutions in the State
of New York generally are authorized or required by law or other governmental
actions to close.

     

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

     

    “Charter” means, with respect
to any Person, its certificate or articles of incorporation, articles of
association, or similar organizational document.

     

    “Common Stock” has the meaning
ascribed to it in the Purchase Agreement.

     

    “Company” means the Person
whose name, corporate or other organizational form and jurisdiction of
organization is set forth in Item 1 of Schedule A hereto.

     

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

     

    “convertible securities” has
the meaning set forth in Section 13(B).

     

    “CPP” has the meaning ascribed
to it in the Purchase Agreement.

     

    “Exchange Act” means the
Securities Exchange Act of 1934, as amended, or any successor statute, and the
rules and regulations promulgated thereunder.

     

    “Exercise Price” means the
amount set forth in Item 2(a) of Schedule A hereto; provided, that such amount
shall be reduced by the amount set forth in Item 2(b) of Schedule A hereto on
each six month anniversary of the Issue Date if the Shareholder Approvals shall
not have been obtained prior to such anniversary, up to a maximum reduction of
the amount set forth in Item 2(c) of Schedule A hereto.

     

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

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    “Fair Market Value” means,
with respect to any security or other property, the fair market value of such
security or other property as determined by the Board of Directors, acting in
good faith or, with respect to Section 14, as determined by the Original
Warrantholder acting in good faith. For so long as the Original Warrantholder
holds this Warrant or any portion thereof, it may object in writing to the Board
of Director’s calculation of fair market value within 10 days of receipt of
written notice thereof. If the Original Warrantholder and the Company are unable
to agree on fair market value during the 10-day period following the delivery of
the Original Warrantholder’s objection, the Appraisal Procedure may be invoked
by either party to determine Fair Market Value by delivering written
notification thereof not later than the 30th day after delivery of the
Original Warrantholder’s objection.

     

    “Governmental Entities” has
the meaning ascribed to it in the Purchase Agreement.

     

    “Initial Number” has the
meaning set forth in Section 13(B).

     

    “Issue Date” means the date
set forth in Item 3 of Schedule A hereto.

     

    “Market Price” means, with
respect to a particular security, on any given day, the last reported sale price
regular way or, in case no such reported sale takes place on such day, the
average of the last closing bid and ask prices regular way, in either case on
the principal national securities exchange on which the applicable securities
are listed or admitted to trading, or if not listed or admitted to trading on
any national securities exchange, the average of the closing bid and ask prices
as furnished by two members of the Financial Industry Regulatory Authority, Inc.
selected from time to time by the Company for that purpose. “Market Price” shall
be determined without reference to after hours or extended hours trading. If
such security is not listed and traded in a manner that the quotations referred
to above are available for the period required hereunder, the Market Price per
share of Common Stock shall be deemed to be (i) in the event that any portion of
the Warrant is held by the Original Warrantholder, the fair market value per
share of such security as determined in good faith by the Original Warrantholder
or (ii) in all other circumstances, the fair market value per share of such
security as determined in good faith by the Board of Directors in reliance on an
opinion of a nationally recognized independent investment banking corporation
retained by the Company for this purpose and certified in a resolution to the
Warrantholder. For the purposes of determining the Market Price of the Common
Stock on the "trading day" preceding, on or following the occurrence of an
event, (i) that trading day shall be deemed to commence immediately after the
regular scheduled closing time of trading on the New York Stock Exchange or, if
trading is closed at an earlier time, such earlier time and (ii) that trading
day shall end at the next regular scheduled closing time, or if trading is
closed at an earlier time, such earlier time (for the avoidance of doubt, and as
an example, if the Market Price is to be determined as of the last trading day
preceding a specified event and the closing time of trading on a particular day
is 4:00 p.m. and the specified event occurs at 5:00 p.m. on that day, the Market
Price would be determined by reference to such 4:00 p.m. closing
price).

     

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

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

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

     

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

     

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

     

    “Per Share Fair Market Value”
has the meaning set forth in Section 13(C).

     

    “Preferred Shares” means the
perpetual preferred stock issued to the Original Warrantholder on the Issue Date
pursuant to the Purchase Agreement.

     

    “Pro Rata Repurchases” means
any purchase of shares of Common Stock by the Company or any Affiliate thereof
pursuant to (A) any tender offer or exchange offer subject to Section 13(e) or
14(e) of the Exchange Act or Regulation 14E promulgated thereunder or (B) any
other offer available to substantially all holders of Common Stock, in the case
of both (A) or (B), whether for cash, shares of Capital Stock of the Company,
other securities of the Company, evidences of indebtedness of the Company or any
other Person or any other property (including, without limitation, shares of
Capital Stock, other securities or evidences of indebtedness of a subsidiary),
or any combination thereof, effected while this Warrant is outstanding. The
“Effective Date” of a
Pro Rata Repurchase shall mean the date of acceptance of shares for purchase or
exchange by the Company under any tender or exchange offer which is a Pro Rata
Repurchase or the date of purchase with respect to any Pro Rata Repurchase that
is not a tender or exchange offer.

     

    “Purchase Agreement” means the
Securities Purchase Agreement – Standard Terms incorporated into the Letter
Agreement, dated as of the date set forth in Item 5 of Schedule A hereto, as
amended from time to time, between the Company and the United States Department
of the Treasury (the “Letter
Agreement”), including all annexes and schedules thereto.

     

    “Qualified Equity Offering”
has the meaning ascribed to it in the Purchase Agreement.

     

    “Regulatory Approvals” with
respect to the Warrantholder, means, to the extent applicable and required to
permit the Warrantholder to exercise this Warrant for shares of Common Stock and
to own such Common Stock without the Warrantholder being in violation of
applicable law, rule or regulation, the receipt of any necessary approvals and
authorizations of, filings and registrations with, notifications to, or
expiration or termination of any applicable waiting period under, the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules
and regulations thereunder.

     

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

     

    “Securities Act” means the
Securities Act of 1933, as amended, or any successor statute, and the rules and
regulations promulgated thereunder.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    “Shareholder Approvals” means
all shareholder approvals necessary to (A) approve the exercise of this Warrant
for Shares for purposes of the section or rule set forth in Item 6 of Schedule A
hereto, and/or (B) amend the Charter to increase the number of authorized shares
of Common Stock to the extent necessary to permit the exercise of this
Warrant.

     

    “Shares” has the meaning set
forth in Section 2.

     

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

     

    “U.S. GAAP” means United
States generally accepted accounting principles.

     

    “Warrantholder” has the
meaning set forth in Section 2.

     

    “Warrant” means this Amended
and Restated Warrant, issued pursuant to the Purchase Agreement.

     

    2.           Number of Shares; Exercise
Price. This certifies that, for value received, the United States
Department of the Treasury or its permitted assigns (the “Warrantholder”) is entitled,
upon the terms and subject to the conditions hereinafter set forth, to acquire
from the Company, in whole or in part, after the receipt of all applicable
Regulatory Approvals and Shareholder Approvals, if any, up to an aggregate of
the number of fully paid and nonassessable shares of Common Stock set forth in
Item 7 of Schedule A hereto, at a purchase price per share of Common Stock equal
to the Exercise Price. The number of shares of Common Stock (the “Shares”) and the Exercise
Price are subject to adjustment as provided herein, and all references to
“Common Stock,” “Shares” and “Exercise Price” herein shall be deemed to include
any such adjustment or series of adjustments.

     

    3.           Exercise of Warrant;
Term. Subject to Section 2, to the extent permitted by applicable laws
and regulations, the right to purchase the Shares represented by this Warrant is
exercisable, in whole or in part by the Warrantholder, at any time or from time
to time after the execution and delivery of this Warrant by the Company on the
date hereof, but in no event later than 5:00 p.m., New York City time on the
tenth anniversary of the Issue Date (the “Expiration Time”), by (A) the
surrender of this Warrant and Notice of Exercise annexed hereto, duly completed
and executed on behalf of the Warrantholder, at the principal executive office
of the Company located at the address set forth in Item 8 of Schedule A hereto
(or such other office or agency of the Company in the United States as it may
designate by notice in writing to the Warrantholder at the address of the
Warrantholder appearing on the books of the Company), and (B) payment of the
Exercise Price for the Shares thereby purchased:

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    (i)           by
having the Company withhold, from the shares of Common Stock that would
otherwise be delivered to the Warrantholder upon such exercise, shares of Common
stock issuable upon exercise of the Warrant equal in value to the aggregate
Exercise Price as to which this Warrant is so exercised based on the Market
Price of the Common Stock on the trading day on which this Warrant is exercised
and the Notice of Exercise is delivered to the Company pursuant to this Section
3, or

     

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

     

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

     

    4.           Issuance of Shares;
Authorization; Listing. Certificates for Shares issued upon exercise of
this Warrant will be issued in such name or names as the Warrantholder may
designate and will be delivered to such named Person or Persons within a
reasonable time, not to exceed three business days after the date on which this
Warrant has been duly exercised in accordance with the terms of this Warrant.
The Company hereby represents and warrants that any Shares issued upon the
exercise of this Warrant in accordance with the provisions of Section 3 will be
duly and validly authorized and issued, fully paid and nonassessable and free
from all taxes, liens and charges (other than liens or charges created by the
Warrantholder, income and franchise taxes incurred in connection with the
exercise of the Warrant or taxes in respect of any transfer occurring
contemporaneously therewith). The Company agrees that the Shares so issued will
be deemed to have been issued to the Warrantholder as of the close of business
on the date on which this Warrant and payment of the Exercise Price are
delivered to the Company in accordance with the terms of this Warrant,
notwithstanding that the stock transfer books of the Company may then be closed
or certificates representing such Shares may not be actually delivered on such
date. Subject to receipt of Shareholder Approvals, the Company will at all times
reserve and keep available, out of its authorized but unissued Common Stock,
solely for the purpose of providing for the exercise of this Warrant, the
aggregate number of shares of Common Stock then issuable upon exercise of this
Warrant at any time. The Company will (A) procure, at its sole expense, the
listing of the Shares issuable upon exercise of this Warrant at any time,
subject to issuance or notice of issuance, on all principal stock exchanges on
which the Common Stock is then listed or traded and (B) maintain such listings
of such Shares at all times after issuance. The Company will use reasonable best
efforts to ensure that the Shares may be issued without violation of any
applicable law or regulation or of any requirement of any securities exchange on
which the Shares are listed or traded.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    5.           No Fractional Shares or
Scrip. No fractional Shares or scrip representing fractional Shares shall
be issued upon any exercise of this Warrant. In lieu of any fractional Share to
which the Warrantholder would otherwise be entitled, the Warrantholder shall be
entitled to receive a cash payment equal to the Market Price of the Common Stock
on the last trading day preceding the date of exercise less the pro-rated
Exercise Price for such fractional share.

     

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

     

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

     

    8.           Transfer/Assignment.

     

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

     

    (B)         The
transfer of the Warrant and the Shares issued upon exercise of the Warrant are
subject to the restrictions set forth in Section 4.4 of the Purchase Agreement.
If and for so long as required by the Purchase Agreement, this Warrant shall
contain the legends as set forth in Sections 4.2(a) and 4.2(b) of the Purchase
Agreement.

     

    9.           Exchange and Registry of
Warrant. This Warrant is exchangeable, upon the surrender hereof by the
Warrantholder to the Company, for a new warrant or warrants of like tenor and
representing the right to purchase the same aggregate number of Shares. The
Company shall maintain a registry showing the name and address of the
Warrantholder as the registered holder of this Warrant. This Warrant may be
surrendered for exchange or exercise in accordance with its terms, at the office
of the Company, and the Company shall be entitled to rely in all respects, prior
to written notice to the contrary, upon such registry.

     

    10.          Loss, Theft, Destruction or
Mutilation of Warrant. Upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and in the case of any such loss, theft or destruction, upon receipt of
a bond, indemnity or security reasonably satisfactory to the Company, or, in the
case of any such mutilation, upon surrender and cancellation of this Warrant,
the Company shall make and deliver, in lieu of such lost, stolen, destroyed or
mutilated Warrant, a new Warrant of like tenor and representing the right to
purchase the same aggregate number of Shares as provided for in such lost,
stolen, destroyed or mutilated Warrant.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

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

     

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

     

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

     

    (A)           Stock Splits, Subdivisions,
Reclassifications or Combinations. If the Company shall (i) declare and
pay a dividend or make a distribution on its Common Stock in shares of Common
Stock, (ii) subdivide or reclassify the outstanding shares of Common Stock into
a greater number of shares, or (iii) combine or reclassify the outstanding
shares of Common Stock into a smaller number of shares, the number of Shares
issuable upon exercise of this Warrant at the time of the record date for such
dividend or distribution or the effective date of such subdivision, combination
or reclassification shall be proportionately adjusted so that the Warrantholder
after such date shall be entitled to purchase the number of shares of Common
Stock which such holder would have owned or been entitled to receive in respect
of the shares of Common Stock subject to this Warrant after such date had this
Warrant been exercised immediately prior to such date. In such event, the
Exercise Price in effect at the time of the record date for such dividend or
distribution or the effective date of such subdivision, combination or
reclassification shall be adjusted to the number obtained by dividing (x) the
product of (1) the number of Shares issuable upon the exercise of this Warrant
before such adjustment and (2) the Exercise Price in effect immediately prior to
the record or effective date, as the case may be, for the dividend,
distribution, subdivision, combination or reclassification giving rise to this
adjustment by (y) the new number of Shares issuable upon exercise of the Warrant
determined pursuant to the immediately preceding sentence.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    (B)          Certain Issuances of Common
Shares or Convertible Securities. Until the earlier of (i) the date on
which the Original Warrantholder no longer holds this Warrant or any portion
thereof and (ii) the third anniversary of the Issue Date, if the Company shall
issue shares of Common Stock (or rights or warrants or other securities
exercisable or convertible into or exchangeable (collectively, a “conversion”) for shares of
Common Stock) (collectively, “convertible securities”)
(other than in Permitted Transactions (as defined below) or a transaction to
which subsection (A) of this Section 13 is applicable) without consideration or
at a consideration per share (or having a conversion price per share) that is
less than 90% of the Market Price on the last trading day preceding the date of
the agreement on pricing such shares (or such convertible securities) then, in
such event:

     

    (A)           the
number of Shares issuable upon the exercise of this Warrant immediately prior to
the date of the agreement on pricing of such shares (or of such convertible
securities) (the “Initial
Number”) shall be increased to the number obtained by multiplying the
Initial Number by a fraction (A) the numerator of which shall be the sum of (x)
the number of shares of Common Stock of the Company outstanding on such date and
(y) the number of additional shares of Common Stock issued (or into which
convertible securities may be exercised or convert) and (B) the denominator of
which shall be the sum of (I) the number of shares of Common Stock outstanding
on such date and (II) the number of shares of Common Stock which the aggregate
consideration receivable by the Company for the total number of shares of Common
Stock so issued (or into which convertible securities may be exercised or
convert) would purchase at the Market Price on the last trading day preceding
the date of the agreement on pricing such shares (or such convertible
securities); and

     

    (B)           the
Exercise Price payable upon exercise of the Warrant shall be adjusted by
multiplying such Exercise Price in effect immediately prior to the date of the
agreement on pricing of such shares (or of such convertible securities) by a
fraction, the numerator of which shall be the number of shares of Common Stock
issuable upon exercise of this Warrant prior to such date and the denominator of
which shall be the number of shares of Common Stock issuable upon exercise of
this Warrant immediately after the adjustment described in clause (A)
above.

     

    For
purposes of the foregoing, the aggregate consideration receivable by the Company
in connection with the issuance of such shares of Common Stock or convertible
securities shall be deemed to be equal to the sum of the net offering price
(including the Fair Market Value of any non-cash consideration and after
deduction of any related expenses payable to third parties) of all such
securities plus the minimum aggregate amount, if any, payable upon exercise or
conversion of any such convertible securities into shares of Common Stock; and
“Permitted
Transactions” shall mean issuances (i) as consideration for or to fund
the acquisition of businesses and/or related assets, (ii) in connection with
employee benefit plans and compensation related arrangements in the ordinary
course and consistent with past practice approved by the Board of Directors,
(iii) in connection with a public or broadly marketed offering and sale of
Common Stock or convertible securities for cash conducted by the Company or its
affiliates pursuant to registration under the Securities Act or Rule 144A
thereunder on a basis consistent with capital raising transactions by comparable
financial institutions and (iv) in connection with the exercise of preemptive
rights on terms existing as of the Issue Date. Any adjustment made pursuant to
this Section 13(B) shall become effective immediately upon the date of such
issuance.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    (C)           Other Distributions.
In case the Company shall fix a record date for the making of a distribution to
all holders of shares of its Common Stock of securities, evidences of
indebtedness, assets, cash, rights or warrants (excluding Ordinary Cash
Dividends, dividends of its Common Stock and other dividends or distributions
referred to in Section 13(A)), in each such case, the Exercise Price in effect
prior to such record date shall be reduced immediately thereafter to the price
determined by multiplying the Exercise Price in effect immediately prior to the
reduction by the quotient of (x) the Market Price of the Common Stock on the
last trading day preceding the first date on which the Common Stock trades
regular way on the principal national securities exchange on which the Common
Stock is listed or admitted to trading without the right to receive such
distribution, minus the amount of cash and/or the Fair Market Value of the
securities, evidences of indebtedness, assets, rights or warrants to be so
distributed in respect of one share of Common Stock (such amount and/or Fair
Market Value, the “Per Share
Fair Market Value”) divided by (y) such Market Price on such date
specified in clause (x); such adjustment shall be made successively whenever
such a record date is fixed. In such event, the number of Shares issuable upon
the exercise of this Warrant shall be increased to the number obtained by
dividing (x) the product of (1) the number of Shares issuable upon the exercise
of this Warrant before such adjustment, and (2) the Exercise Price in effect
immediately prior to the distribution giving rise to this adjustment by (y) the
new Exercise Price determined in accordance with the immediately preceding
sentence. In the case of adjustment for a cash dividend that is, or is
coincident with, a regular quarterly cash dividend, the Per Share Fair Market
Value would be reduced by the per share amount of the portion of the cash
dividend that would constitute an Ordinary Cash Dividend. In the event that such
distribution is not so made, the Exercise Price and the number of Shares
issuable upon exercise of this Warrant then in effect shall be readjusted,
effective as of the date when the Board of Directors determines not to
distribute such shares, evidences of indebtedness, assets, rights, cash or
warrants, as the case may be, to the Exercise Price that would then be in effect
and the number of Shares that would then be issuable upon exercise of this
Warrant if such record date had not been fixed.

     

    (D)           Certain Repurchases of
Common Stock. In case the Company effects a Pro Rata Repurchase of Common
Stock, then the Exercise Price shall be reduced to the price determined by
multiplying the Exercise Price in effect immediately prior to the Effective Date
of such Pro Rata Repurchase by a fraction of which the numerator shall be (i)
the product of (x) the number of shares of Common Stock outstanding immediately
before such Pro Rata Repurchase and (y) the Market Price of a share of Common
Stock on the trading day immediately preceding the first public announcement by
the Company or any of its Affiliates of the intent to effect such Pro Rata
Repurchase, minus (ii) the aggregate purchase price of the Pro Rata Repurchase,
and of which the denominator shall be the product of (i) the number of shares of
Common Stock outstanding immediately prior to such Pro Rata Repurchase minus the
number of shares of Common Stock so repurchased and (ii) the Market Price per
share of Common Stock on the trading day immediately preceding the first public
announcement by the Company or any of its Affiliates of the intent to effect
such Pro Rata Repurchase. In such event, the number of shares of Common Stock
issuable upon the exercise of this Warrant shall be increased to the number
obtained by dividing (x) the product of (1) the number of Shares issuable upon
the exercise of this Warrant before such adjustment, and (2) the Exercise Price
in effect immediately prior to the Pro Rata Repurchase giving rise to this
adjustment by (y) the new Exercise Price determined in accordance with the
immediately preceding sentence. For the avoidance of doubt, no increase to the
Exercise Price or decrease in the number of Shares issuable upon exercise of
this Warrant shall be made pursuant to this Section 13(D).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    (E)           Business
Combinations. In case of any Business Combination or reclassification of
Common Stock (other than a reclassification of Common Stock referred to in
Section 13(A)), the Warrantholder’s right to receive Shares upon exercise of
this Warrant shall be converted into the right to exercise this Warrant to
acquire the number of shares of stock or other securities or property (including
cash) which the Common Stock issuable (at the time of such Business Combination
or reclassification) upon exercise of this Warrant immediately prior to such
Business Combination or reclassification would have been entitled to receive
upon consummation of such Business Combination or reclassification; and in any
such case, if necessary, the provisions set forth herein with respect to the
rights and interests thereafter of the Warrantholder shall be appropriately
adjusted so as to be applicable, as nearly as may reasonably be, to the
Warrantholder’s right to exercise this Warrant in exchange for any shares of
stock or other securities or property pursuant to this paragraph. In determining
the kind and amount of stock, securities or the property receivable upon
exercise of this Warrant following the consummation of such Business
Combination, if the holders of Common Stock have the right to elect the kind or
amount of consideration receivable upon consummation of such Business
Combination, then the consideration that the Warrantholder shall be entitled to
receive upon exercise shall be deemed to be the types and amounts of
consideration received by the majority of all holders of the shares of common
stock that affirmatively make an election (or of all such holders if none make
an election).

     

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

     

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

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    (H)           Completion of Qualified
Equity Offering. In the event the Company (or any successor by Business
Combination) completes one or more Qualified Equity Offerings on or prior to
December 31, 2009 that result in the Company (or any such successor ) receiving
aggregate gross proceeds of not less than 100% of the aggregate liquidation
preference of the Preferred Shares (and any preferred stock issued by any such
successor to the Original Warrantholder under the CPP), the number of shares of
Common Stock underlying the portion of this Warrant then held by the Original
Warrantholder shall be thereafter reduced by a number of shares of Common Stock
equal to the product of (i) 0.5 and (ii) the number of shares underlying the
Warrant on the Issue Date (adjusted to take into account all other theretofore
made adjustments pursuant to this Section 13).

     

    (I)           Other Events. For so
long as the Original Warrantholder holds this Warrant or any portion thereof, if
any event occurs as to which the provisions of this Section 13 are not strictly
applicable or, if strictly applicable, would not, in the good faith judgment of
the Board of Directors of the Company, fairly and adequately protect the
purchase rights of the Warrants in accordance with the essential intent and
principles of such provisions, then the Board of Directors shall make such
adjustments in the application of such provisions, in accordance with such
essential intent and principles, as shall be reasonably necessary, in the good
faith opinion of the Board of Directors, to protect such purchase rights as
aforesaid. The Exercise Price or the number of Shares into which this Warrant is
exercisable shall not be adjusted in the event of a change in the par value of
the Common Stock or a change in the jurisdiction of incorporation of the
Company.

     

    (J)           Statement Regarding
Adjustments. Whenever the Exercise Price or the number of Shares into
which this Warrant is exercisable shall be adjusted as provided in Section 13,
the Company shall forthwith file at the principal office of the Company a
statement showing in reasonable detail the facts requiring such adjustment and
the Exercise Price that shall be in effect and the number of Shares into which
this Warrant shall be exercisable after such adjustment, and the Company shall
also cause a copy of such statement to be sent by mail, first class postage
prepaid, to each Warrantholder at the address appearing in the Company’s
records.

     

    (K)           Notice of Adjustment
Event. In the event that the Company shall propose to take any action of
the type described in this Section 13 (but only if the action of the type
described in this Section 13 would result in an adjustment in the Exercise Price
or the number of Shares into which this Warrant is exercisable or a change in
the type of securities or property to be delivered upon exercise of this
Warrant), the Company shall give notice to the Warrantholder, in the manner set
forth in Section 13(J), which notice shall specify the record date, if any, with
respect to any such action and the approximate date on which such action is to
take place. Such notice shall also set forth the facts with respect thereto as
shall be reasonably necessary to indicate the effect on the Exercise Price and
the number, kind or class of shares or other securities or property which shall
be deliverable upon exercise of this Warrant. In the case of any action which
would require the fixing of a record date, such notice shall be given at least
10 days prior to the date so fixed, and in case of all other action, such notice
shall be given at least 15 days prior to the taking of such proposed action.
Failure to give such notice, or any defect therein, shall not affect the
legality or validity of any such action.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    (L)           Proceedings Prior to Any
Action Requiring Adjustment. As a condition precedent to the taking of
any action which would require an adjustment pursuant to this Section 13, the
Company shall take any action which may be necessary, including obtaining
regulatory, New York Stock Exchange, NASDAQ Stock Market or other applicable
national securities exchange or stockholder approvals or exemptions, in order
that the Company may thereafter validly and legally issue as fully paid and
nonassessable all shares of Common Stock that the Warrantholder is entitled to
receive upon exercise of this Warrant pursuant to this Section 13.

     

    (M)           Adjustment Rules. Any
adjustments pursuant to this Section 13 shall be made successively whenever an
event referred to herein shall occur. If an adjustment in Exercise Price made
hereunder would reduce the Exercise Price to an amount below par value of the
Common Stock, then such adjustment in Exercise Price made hereunder shall reduce
the Exercise Price to the par value of the Common Stock.

     

    14.           Exchange. At any time
(i) following the date on which the shares of Common Stock of the Company are no
longer listed or admitted to trading on a national securities exchange (other
than in connection with any Business Combination) or (ii) following the 18-
month anniversary of the Issue Date and until the receipt of the Shareholder
Approvals allowing the full exercise of this Warrant for Common Stock, the
Original Warrantholder may cause the Company to exchange all or a portion of
this Warrant for an economic interest (to be determined by the Original
Warrantholder after consultation with the Company) of the Company classified as
permanent equity under U.S. GAAP having a value equal to the Fair Market Value
of the portion of the Warrant so exchanged. The Original Warrantholder shall
calculate any Fair Market Value required to be calculated pursuant to this
Section 14, which shall not be subject to the Appraisal Procedure.

     

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

     

    16.           Governing Law. This Warrant will be governed by and
construed in accordance with the federal law of the United States if and to the
extent such law is applicable, and otherwise in accordance with the laws of the
State of New York applicable to contracts made and to be performed entirely
within such State. Each of the Company and the Warrantholder agrees (a) to
submit to the exclusive jurisdiction and venue of the United States District
Court for the District of Columbia for any civil action, suit or proceeding
arising out of or relating to this Warrant or the transactions contemplated
hereby, and (b) that notice may be served upon the Company at the address in
Section 20 below and upon the Warrantholder at the address for the Warrantholder
set forth in the registry maintained by the Company pursuant to Section 9
hereof. To the extent permitted by applicable law, each of the Company and the
Warrantholder hereby unconditionally waives trial by jury in any civil legal
action or proceeding relating to the Warrant or the transactions contemplated
hereby or thereby.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    17.           Binding Effect. This
Warrant shall be binding upon any successors or assigns of the
Company.

     

    18.           Amendments. This
Warrant may be amended and the observance of any term of this Warrant may be
waived only with the written consent of the Company and the
Warrantholder.

     

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

     

    20.           Notices. Any notice,
request, instruction or other document to be given hereunder by any party to the
other will be in writing and will be deemed to have been duly given (a) on the
date of delivery if delivered personally, or by facsimile, upon confirmation of
receipt, or (b) on the second business day following the date of dispatch if
delivered by a recognized next day courier service. All notices hereunder shall
be delivered as set forth in Item 9 of Schedule A hereto, or pursuant to such
other instructions as may be designated in writing by the party to receive such
notice.

     

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

     

    [Remainder
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    [Form of Notice of
Exercise]

    Date:
_________

     

    TO:         [Company]

     

    RE:         Election
to Purchase Common Stock

     

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

     

    Number of
Shares of Common
Stock        ______________

     

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

     

    Aggregate
Exercise
Price:                        
______________

     

    Holder:_______________________                  

    By:__________________________                  

    Name:________________________                  

    Title:_________________________                  

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by a
duly authorized officer.

     

    Dated:
March 31, 2009

     

    
      
        
          
            
              
                
                  
                    	
                            COMPANY: FIRST PLACE
      FINANCIAL CORP.

                          
	 
      	 
      
	
                            By:

                          	
                            /s/ Steven R. Lewis

                          
	
                            Name:
      Steven R. Lewis

                          
	
                            Title:  
      President and Chief Executive Officer

                          
	 
	
                            Attest:

                          
	 	 
	
                            By:

                          	
                            /s/ J. Craig Carr

                          
	
                            Name:
      J. Craig Carr

                          
	
                            Title:  
      General
Counsel

                          

                  

                

              

            

          

        

      

    

     

    [Signature
Page to Warrant]

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    SCHEDULE
A

     

    Item 1

    Name:  First
Place Financial Corp.

    Corporate
or other organizational form:  Corporation

    Jurisdiction
of organization:  Delaware

     

    Item 2

    (a)
Exercise Price:  $2.98

    (b)
Amount equal to 15% of the Exercise Price in effect on the Issue
Date:  $0.45

    (c)
Amount equal to 45% of the Exercise Price in effect on the Issue
Date:  $1.34

     

    Item 3

    Issue
Date:  March 13, 2009

     

    Item 4

    Amount of
last dividend declared prior to the Issue Date:  $0.01

     

    Item 5

    Date of
Letter Agreement between the Company and the United States Department of the
Treasury:  March 13, 2009

     

    Item 6

    Applicable
section or rule:  Rule 4350(i) of the NASDAQ Marketplace Rules, as
applicable.

     

    Item 7

    Number of
shares of Common Stock:  3,670,822

     

    Item 8

    Company’s
address:

     

    First
Place Financial Corp.

    185 E.
Market Street

    Warren,
Ohio 44481

    Item 9

    Notice
information:

     

    First
Place Financial Corp.

    185 E.
Market Street

    Warren,
Ohio 44481

    Attention:
Craig Carr

    Telephone:
(330) 373-1221

    Facsimile:
(330) 393-5578

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