Document:

exhibit10_11.htm

    EXHIBIT
10.11

    
 

    Loan
Agreement

     

    THIS LOAN
AGREEMENT (this “Agreement”)
is made as of the ___ day of ________ 2009, by and between CAPITOL BANCORP LTD.
(“Lender”),
a Michigan corporation, and MICHIGAN COMMERCE BANCORP LIMITED (“Borrower”),
a Michigan corporation.

     

    

     

    ARTICLE
1.

    GENERAL
DEFINITIONS

     

    1.1 Defined
Terms.

     

    When used
herein, the following terms shall have the meanings set forth
below:

     

    “Agreement”
- has the meaning assigned to such term in the first paragraph
hereof.

     

    “Interest
Rate” - has the meaning assigned to such term in Section 2.3 of this
Agreement.

     

    “Borrower”
- has the meaning assigned to such term in the first paragraph of this
Agreement.

     

    “Business
Day” - means any day other than a Saturday, Sunday or other day on which
commercial banks in the State of Michigan are authorized or required by law to
close.

     

    “Closing
Date” - has the meaning assigned to such term in Section 2.1 of this
Agreement.

     

    “Default” -
an event or condition the occurrence of which would, with a lapse of time or the
giving of notice or both, become an Event of Default.

     

    “Event of
Default” - has the meaning assigned to such term in Section 5.1 of
this Agreement.

     

    “GAAP” -
has the meaning assigned to such term in Section 1.2 of this
Agreement.

     

    “Highest Lawful
Rate” - means the maximum rate of interest, if any, that at any time or
from time to time may be contracted for, taken, charged or received by the
Lender on the obligations owed to it under the laws applicable to the Lender and
this transaction.

     

    “Indebtedness”
- means, with respect to any person and without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than trade
payables entered into in the ordinary course of business on ordinary terms);
(c) all non-contingent reimbursement or payment obligations with respect to
any letters of credit (including standby and commercial), banker’s acceptances,
bank guaranties, surety bonds and similar instruments; (d) all obligations
evidenced by notes, bonds, debentures or similar instruments, including
obligations so evidenced incurred in connection with the acquisition of
property, assets or businesses; (e) all indebtedness created or arising
under any conditional sale or other title retention agreement, or incurred as
financing, 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    in either
case with respect to property acquired by such person (even though the rights
and remedies of the seller or bank under such agreement in the event of default
are limited to repossession or sale of such property); (f) all obligations
with respect to capital leases (g) all net obligations with respect to any
agreement (including any master agreement and any agreement, whether or not in
writing, relating to any single transaction) that is an interest rate swap
agreement, basis swap, forward rate agreement, commodity swap, commodity option,
equity or equity index swap or option, bond option, interest rate option,
forward foreign exchange agreement, rate cap, collar or floor agreement,
currency swap agreement, cross-currency rate swap agreement, currency option or
any other, similar agreement (including any option to enter into any of the
foregoing); (h) all indebtedness referred to in clauses (a) through
(g) above secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any lien upon or in
property (including accounts and contracts rights) owned by such person, even
though such person has not assumed or become liable for the payment of such
Indebtedness; and (i) all obligations in respect of guaranteeing,
purchasing or otherwise discharging indebtedness or obligations of others of the
kinds referred to in clauses (a) through (g) above.

     

    “Interest
Expense” - means, with respect to any fiscal period of the Borrower,
interest expense of the Borrower and its subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.

     

    “Interest Payment
Date” - has the meaning assigned to such term in Section 2.3 of this
Agreement.

     

     “Lender”
- has the meaning assigned to such term in the first paragraph of this
Agreement.

     

    “Loan” -
has the meaning assigned to such term in Section 2.1 of this
Agreement.

     

    “Maturity
Date” - has the meaning assigned to such term in Section 2.2 of this
Agreement.

     

    “Note” -
has the meaning assigned to such term in Section 2.1 of this
Agreement.

     

    1.2 Accounting
Terms.  Any
accounting terms used in this Agreement which are not specifically defined shall
have the meanings customarily given them in accordance with generally accepted
accounting principles (“GAAP”) at
the time in effect.

     

     

    ARTICLE
2.

    LOAN

     

    2.1 The
Loan.  Subject
to the terms and conditions of this Agreement, Lender agrees to accept from
Borrower on the Closing Date a demand note in the principal amount of $2,500,000 (the “Note”),
substantially in the form of Exhibit A hereto. The indebtedness of the Borrower
evidenced by the Note is hereinafter referred to as the “Loan”.

     

    
      
        
        

      

      
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    2.2 Principal
Payments of the Loan.  The
Borrower shall principal upon demand but in no event later than three years from
the date of the Note (the “Maturity
Date”).

     

    2.3 Interest. 
The Loan
shall bear interest on the principal amount thereof outstanding from and after
the Closing Date at a rate per annum equal to 8% (the “Interest
Rate”), payable quarterly as defined in the Note.  Anything
contained herein to the contrary notwithstanding, after the Maturity Date, after
the date on which the Loan shall have become due and payable pursuant to
Section 7 or in any period during which a Default shall exist, the Loan
shall bear interest at a rate per annum equal to the Interest Rate plus 2.0% and
such interest shall be due and payable on demand.

     

     

    ARTICLE
3.

    REPRESENTATIONS AND
WARRANTIES

     

    As an
inducement to Lender to make the Loan, Borrower warrants and represents to
Lender that:

     

    3.1 Organization
and Qualification.  Borrower
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Michigan.

     

    3.2 Corporate
Powers.  Borrower
has the right and power and is duly authorized and empowered to enter into,
execute, deliver and perform this Agreement and the Note. This Agreement and the
Note are the legal, valid and binding obligations of Borrower, enforceable
against Borrower in accordance with their respective terms.

     

    3.3 Compliance
with Laws, Other Instruments, etc.  Neither
the execution, delivery and performance by the Borrower of this Agreement and
the Note will (a) contravene, result in any breach of, or constitute a
default under, or result in the creation of any lien in respect of any property
of the Borrower or any subsidiary under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, corporate charter or by-laws, or any
other agreement or instrument to which the Borrower or any subsidiary is bound
or by which the Borrower or any subsidiary or any of their respective properties
may be bound or affected other than in respect of those certain indentures,
mortgages, deeds of trust, loans, purchase or credit agreements or leases, or
any other agreements or instruments for which written consents shall have been
obtained either prior to, or contemporaneously with, the closing of this
Agreement; (b) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or governmental authority applicable to the Borrower or any
subsidiary, or (c) violate any provision of any statute or other rule or
regulation of any governmental authority applicable to the Borrower or any
subsidiary.

     

    3.4 Governmental
Authorizations, etc.  No
consent, approval or authorization of, or registration, filing or declaration
with, any governmental authority is required in connection with the execution,
delivery or performance by the Borrower of this Agreement or the
Note.

     

    3.5 Litigation:
Observance of Agreements, Statutes and Orders.  There

     

    
      
        
        

      

      
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    are no
actions, suits or proceedings pending or, to the knowledge of the Borrower,
threatened against or affecting the Borrower or any subsidiary or any property
of the Borrower or any subsidiary in any court or before any arbitrator of any
kind or before or by any governmental authority that, individually or in the
aggregate, could reasonably be expected to have a material adverse effect on the
business, financial position or prospects of the Borrower. Neither the Borrower
nor any subsidiary is in default under any term of any agreement or instrument
to which it is a party or by which it is bound, or any order, judgment, decree
or ruling of any court, arbitrator or governmental authority or is in violation
of any applicable law, ordinance, rule or regulation of any governmental
authority.

     

    3.6 Taxes. 
The
Borrower and its subsidiaries have filed all tax returns that are required to
have been filed in any jurisdiction, and have paid all taxes shown to be due and
payable on such returns and all other taxes and assessments levied upon them or
their properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent,
except for any taxes and assessments (a) the amount of which is not
individually or in the aggregate material or (b) the amount, applicability
or validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Borrower or a subsidiary, as the case
may be, has established adequate reserves in accordance with GAAP. The Borrower
knows of no basis for any other tax or assessment that could reasonably be
expected to have a material adverse effect on its business, financial position
or prospects. The charges, accruals and reserves on the books of the Borrower
and its subsidiaries in respect of federal, state or other taxes for all fiscal
periods are adequate.

     

     

    ARTICLE
4.

    AFFIRMATIVE
COVENANTS

     

    4.1 Affirmative
Covenants.  Borrower
covenants that, unless otherwise consented to by Lender in writing, it will:
(a) preserve and maintain its corporate existence and all rights,
privileges and franchises in connection therewith; (b) file all federal,
state and local tax returns and other reports that the Borrower is required by
law to file, maintain adequate reserves for the payment of all taxes,
assessments, governmental charges and levies imposed upon it, its income or its
profits, or upon any property belonging to it, and pay and discharge all such
taxes, assessments, governmental charges and levies prior to the date on which
penalties attach thereto, except where the same are being contested in good
faith by appropriate proceedings and provided that in such event adequate book
reserves have been established with respect to each such claim being contested;
(c) maintain its property in good condition and make all necessary
renewals, repairs, replacements, additions and improvements thereto;
(d) not be in violation of any federal, state, or local laws, ordinances,
governmental rules and regulations to which it is subject, and not fail to
obtain any licenses, permits, franchises or other governmental authorizations
necessary to the ownership of its properties or to the conduct of its business,
which violation or failure to obtain might materially and adversely affect the
business, prospects, profits, properties or condition (financial or otherwise)
of Borrower; (e) keep adequate records and books of account with respect to
its business activities in which proper entries are made in accordance with GAAP
reflecting all its financial transactions.

     

    
      
        
        

      

      
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    ARTICLE
5.

    EVENTS OF
DEFAULT;  RIGHTS AND REMEDIES ON DEFAULT

     

    5.1 Events
of Default.  The
occurrence of any one or more of the following events shall constitute an “Event
of Default”: (a) (i) the failure to make any payment of principal on
the Note when due as provided for herein or in the Note or (ii) the failure
to make any payment of interest on the Note within 5 Business Days after the due
date thereof as provided for herein or in the Note; (b) any warranty,
representation or other statement made or furnished to Lender by or on behalf of
Borrower or in any instrument furnished in compliance with or in reference to
this Agreement proves to have been false or misleading in any material respect
when made or furnished; (c) Borrower fails or neglects to perform, keep or
observe any other term, provision, condition or covenant contained in this
Agreement, which is required to be performed, kept or observed by Borrower and
the same is not cured to Lender’s satisfaction within 30 days after such
occurrence becomes known to any officer of Borrower; (d) the occurrence of
any default or event of default or failure of performance on the part of
Borrower or any subsidiary (including specifically, but without limitation, due
to nonpayment) under any agreement, document or instrument to which Borrower or
such subsidiary is a party or by which Borrower or such subsidiary is bound,
creating or relating to any other Indebtedness of Borrower or such subsidiary;
and (e) dissolution, termination of existence, insolvency (failure of
Borrower or any subsidiary to pay its debts as they mature), appointment of a
receiver, trustee, custodian or similar fiduciary, assignment for the benefit of
creditors or the commencement of any proceedings under the Bankruptcy Code by or
against Borrower or any subsidiary (if against Borrower or a subsidiary, the
continuation of such proceeding for more than 60 days).

     

    5.2   Acceleration
of the Obligations.  Upon the
occurrence of an Event of Default as above provided, all or any portion of the
Loan due or to become due from Borrower to Lender, whether under this Agreement,
the Note or otherwise, shall, at the option of Lender, and without notice or
demand by Lender, become at once due and payable together with all accrued and
unpaid interest thereon; Borrower will thereafter forthwith pay to Lender, in
addition to any and all sums and charges due, the entire principal of and
interest accrued on the Loan.

     

    5.3 Remedies. 
Upon and
after the occurrence of an Event of Default, Lender shall have any and all
rights and remedies available to Lender at law or in equity.

     

    5.4 Remedies
Cumulative.  All
covenants, conditions, provisions, warranties, guaranties, indemnities and other
undertakings of Borrower contained in this Agreement, or in any document
referred to herein or contained in any agreement supplementary hereto, or in any
schedule or contained in any other agreement between Lender and Borrower,
heretofore, concurrently or hereafter entered into, shall be deemed cumulative
to and not in derogation or substitution of any of the terms, covenants,
conditions or agreements of Borrower herein contained.

     

    
      
        
        

      

      
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    ARTICLE
6.

    MISCELLANEOUS

     

    6.1 Transaction
Expenses.  The
Borrower will pay all costs and expenses (including reasonable attorneys’ fees)
incurred in connection with the Loan and in connection with any amendments,
waivers or consents under or in respect of this Agreement or the Note (whether
or not such amendment, waiver or consent becomes effective), including, without
limitation: (a) the costs and expenses incurred in enforcing or defending
any rights under this Agreement or the Note or in responding to any subpoena or
other legal process or informal investigative demand issued in connection with
this Agreement or the Note, or by reason of being the Lender, and (b) the
costs and expenses, including financial advisors’ fees, incurred in connection
with the insolvency or bankruptcy of the Borrower or any subsidiary or in
connection with any work-out or restructuring of the transactions contemplated
hereby and by the Note. The Borrower will also pay the reasonable attorneys’
fees and disbursements of counsel to the Lender incurred in connection with
enforcing or defending any rights under this Agreement or the Note, responding
to any subpoena or other legal process or informal investigative demand issued
in connection with this Agreement or the Note, the insolvency or bankruptcy of
the Borrower or any subsidiary or any work-out or restructuring of the
transactions contemplated hereby and by the Note.

     

    6.2 Survival
of Representations and Warranties.  All
warranties and representations shall survive the making of the
Loan.

     

    6.3 Successors
and Assigns.  All
covenants and other agreements contained in this Agreement by or on behalf of
any of the parties hereto bind and inure to the benefit of their respective
successors and assigns, whether so expressed or not.

     

    6.4 Payments
Due on Non-Business Days.  Anything
in this Agreement or the Note to the contrary notwithstanding, any payment of
principal of or interest on the Note that is due on a date other than a Business
Day shall be made on the next succeeding Business Day without including the
additional days elapsed in the computation of the interest payable on such next
succeeding Business Day.

     

    6.5 Construction. 
Each
covenant contained herein shall be construed (absent express provision to the
contrary) as being independent of each other covenant contained herein, so that
compliance with any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other covenant. Where any
provision herein refers to action to be taken by any person, or which such
person is prohibited from taking, such provision shall be applicable whether
such action is taken directly or indirectly by such person. The headings in this
Agreement and in any related agreement, document or instrument are for purposes
of reference and shall not limit or otherwise affect the meaning hereof or
thereof.

     

    6.6 Severability. 
Wherever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.

     

    
      
        
        

      

      
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    6.7 Modification
of Agreement.  This
Agreement and the Note may not be modified, altered or amended, except by an
agreement in writing signed by Borrower and Lender.

     

    6.8 Governing
Law.  THIS
AGREEMENT HAS BEEN NEGOTIATED, EXECUTED AND DELIVERED AT AND SHALL BE DEEMED TO
HAVE BEEN MADE AT LANSING, MICHIGAN. THE LOAN PROVIDED FOR HEREIN IS TO BE
FUNDED AND REPAID AT AND THIS AGREEMENT IS OTHERWISE TO BE PERFORMED AT LANSING,
MICHIGAN AND THIS AGREEMENT SHALL BE INTERPRETED, AND THE RIGHTS AND LIABILITIES
OF THE PARTIES HERETO DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE STATE OF
MICHIGAN.

     

    6.9 Notices. 
Except as
otherwise provided herein, any notice required hereunder shall be in writing,
and shall be deemed to have been validly served, given or delivered upon deposit
in the United States mails, with proper postage prepaid, and addressed to the
party to be notified as set forth in the first paragraph of this Agreement or to
such other address as each party may designate for itself by like notice given
in accordance with this Section.

     

    IN
WITNESS WHEREOF, this Agreement has been duly executed as of the day and year
specified at the beginning hereof.

     

    CAPITOL
BANCORP LTD.

     

    By:           _________________________

    Name:      _________________________

    Title:        _________________________

     

    MICHIGAN
COMMERCE BANCORP LIMITED

     

    
      	 
      

    

    By:           _________________________

    Name:      _________________________

    Title:        _________________________

     

    
      
         

      

      
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    EXHIBIT
A

     

    PROMISSORY
NOTE

     

    
      
        

      

    

     

    Borrower:  Michigan
Commerce Bancorp
Limited                                                                                                                                                Lender:  Capitol
Bancorp Ltd.

    
      
        

      

    

    PRINCIPAL
AMOUNT:
$2,500,000.00                                                                                                                                    INTEREST RATE:
8.00%

    DATE
OF NOTE: _________

    

    Promise to
Pay.  Michigan Commerce Bancorp Ltd. (“Borrower”) promises to
pay to Capitol Bancorp Ltd. (“Lender”), or order, in lawful money of the United
States of America, the principal amount of up to Two Million Five Hundred
Thousand and 00/100 Dollars ($2,500,000.00), together with interest on the
unpaid principal balance from the date hereof until paid in full.

    

    Payment. Borrower will pay
this loan in one principal payment of all outstanding principal plus interest
upon demand, or if no demand is made sooner, on ____________.  The
final payment due on demand or at maturity will be for all principal and all
accrued interest not yet paid.  In addition, Borrower will pay regular
quarterly payments of all accrued unpaid interest due as of each payment date,
beginning _________ with all subsequent interest payments to be due on the same
day of each quarter thereafter.  The annual interest rate for this
Note is  8.00% and shall be computed on a 365/360 basis; that is, by
applying the ratio of the annual interest rate over a year of 360 days,
multiplied by the outstanding principal balance, multiplied by the
actual  number of days the principal is outstanding.

    

    Prepayment. Borrower may pay
without penalty all or a portion of the amount owed earlier than it is
due.  Early payments will not, unless agreed to by Lender in writing,
relieve Borrower of Borrower’s obligation to continue to make payments under the
payment schedule.  Rather, early payments will reduce the principal
balance due.

    

    Governing Law.  This
Note will be governed by federal law applicable to Lender and, to the extent not
preempted by federal law, the laws of the State of Michigan without regard to
its conflicts of law provisions.  This Note has been accepted by
Lender in the State of Michigan.

    

    Successor
Interests.  The terms of this Note shall be binding upon
Borrower, and upon Borrower’s successors and assigns, and shall inure to the
benefit of Lender and its successors and assigns.

    

    General Provisions. If any
part of this Note cannot be enforced, this fact will not affect the rest of the
Note.  Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Notes, to the extent allowed by law, waive
presentment, demand for payment, and notice of dishonor. Upon any change in the
terms of this Note, and unless otherwise expressly stated in writing, no party
who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability.   All such parties
agree that Lender may renew or extend (repeatedly and for any length of time)
this loan and take any other action deemed necessary by Lender without the
consent of or notice to anyone.

    

    BORROWER:

    

    MICHIGAN
COMMERCE BANCORP LIMITED

    

    

    By:
_________________________________________

    

    Title:
_______________________________________

    

    

    
      
         

      

      
        EXHIBIT
A-1exhibit10_13.htm

    EXHIBIT
10.13

      

       

      

       

      

       

      

       

      

       

      

       

      

       

      

       

      

       

      _________________________________________________

       

      [FORM
OF ] GUARANTEE AGREEMENT

       

      BY
AND BETWEEN

       

      MICHIGAN
COMMERCE BANCORP LIMITED

       

      AND

       

      [THE
BANK OF NEW YORK MELLON CORPORATION]

       

      DATED
AS OF [____________ __, 2009]

       

      _________________________________________________

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      GUARANTEE
AGREEMENT

       

      This
GUARANTEE AGREEMENT (this “Guarantee”),
dated as of ____________ __, 2009, is executed and delivered by MICHIGAN
COMMERCE BANCORP LIMITED, a Michigan corporation (the “Guarantor”),
and [The Bank of
New York Mellon Corporation, a Delaware corporation], as
trustee (the “Guarantee
Trustee”), for the benefit of the Holders (as defined herein) from time
to time of the Trust-Preferred Securities (as defined herein) of [Capitol
Trust I] (the
“Trust”).

       

      WHEREAS,
CAPITOL BANCORP LTD., a bank holding company formed under Michigan law (“CBC”) has
issued certain [junior
subordinated debentures due 2027] (the “Debentures”)
to the Trust which were funded by the Trust’s issuance of certain
trust-preferred securities (collectively, the “Trust-Preferred
Securities”); and

       

      WHEREAS,
CBC is the sole owner of the Guarantor; and

       

      WHEREAS,
CBC and the Guarantor have entered into a Separation Agreement and Plan of
Distribution (the “Separation
Agreement”) whereby, subject to the terms and conditions thereof, CBC
will, in accordance with the Separation Agreement and subject to the terms and
conditions therein, distribute to CBC’s stockholders 95.1% of the common stock
of the Guarantor (the “Distribution”)
on the date specified in the Separation Agreement; and

       

      WHEREAS,
in order to effectuate such Distribution without prejudice to the holders of the
Trust-Preferred Securities, the Guarantor is required to issue this Guarantee in
accordance with the terms set forth below.

       

      NOW,
THEREFORE, in connection with the Distribution, the Guarantor executes and
delivers this Guarantee for the benefit of the Holders.

       

      ARTICLE
1.

      DEFINITIONS AND
INTERPRETATION

       

      Section
1.1 Definitions and
Interpretation.

       

      In this Guarantee, unless the context
otherwise requires:

       

      (a)   capitalized
terms used in this Guarantee but not defined in the preamble above have the
respective meanings assigned to them in this Section
1.1;

       

      (b)   a term
defined anywhere in this Guarantee has the same meaning throughout;

       

      (c)   all
references to “the Guarantee” or “this Guarantee” are to this Guarantee as
modified, supplemented or amended from time to time;

       

      (d)   all
references in this Guarantee to “Articles” or “Sections” are to Articles or
Sections of this Guarantee, unless otherwise specified; and

       

      
        
          
          

        

        
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      (e)   a
reference to the singular includes the plural and vice versa.

       

      “Affiliate”
has the same meaning as given to that term in Rule 405 of the Securities Act of
1933, as amended, or any successor rule thereunder.

       

      “Beneficiaries”
means any Person to whom the Trust is or hereafter becomes indebted or
liable.

       

      “Corporate Trust
Office” means the office of the Guarantee Trustee at which the corporate
trust business of the Guarantee Trustee shall, at any particular time, be
principally administered, which office at the date of execution of this
Guarantee is located at [_____________________________________________].

       

      “Covered
Person” means any Holder of Trust-Preferred Securities.

       

      “Debenture
Documents” shall mean the [Indenture and the Guarantee
Agreement] executed by CBC and the Guarantee Trustee pursuant to the
issuance of the Debentures, in each case as supplemented or
amended.

       

      “Debentures”
means the debt securities of CBC designated as the [8.5% Subordinated Debentures due
2027] held by the Trust.

       

      “Event of
Default” has the meaning set forth in Section
2.4(a).

       

      “Guarantee
Payments” means the following payments or distributions, without
duplication, with respect to the Trust-Preferred Securities, to the extent not
paid or made by the Trust or CBC under the Debenture Documents: (i) any
accrued and unpaid distributions which are required to be paid on such
Trust-Preferred Securities, (ii) any amounts deemed payable by CBC, with
respect to any Trust-Preferred Securities called for redemption by the Trust in
accordance with the Debenture Documents, and (iii) upon a voluntary or
involuntary liquidation, dissolution, winding-up or termination of the Trust
(other than in connection with the distribution of Debentures to the Holders of
the Trust-Preferred Securities in exchange therefor as provided in the Debenture
Documents), the lesser of (a) the aggregate of the liquidation amount and
all accrued and unpaid distributions on the Trust-Preferred Securities to the
date of payment, and (b) the amount of assets of the Trust remaining
available for distribution to Holders in liquidation of the Trust (in either
case, the “Liquidation Distribution”).

       

      “Guarantee
Trustee” means [The Bank
of New York Mellon Corporation], until a Successor Guarantee Trustee has
been appointed and has accepted such appointment pursuant to the terms of this
Guarantee and thereafter means each such Successor Guarantee
Trustee.

       

      “Guarantor”
means Michigan Commerce Bancorp Limited and each of its successors and
assigns.

       

      “Holder”
means any holder, as registered on the books and records of the Trust, of any
Trust-Preferred Securities; provided, however, that, in determining whether the
Holders of the requisite percentage of Trust-Preferred Securities have given any
request, notice, consent or 

       

      
        
          
          

        

        
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      waiver
hereunder, “Holder” shall not include CBC or the Guarantor or any Affiliate of
CBC or the Guarantor.

       

      “Indemnified
Person” means the Guarantee Trustee, any Affiliate of the Guarantee
Trustee, or any officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Guarantee
Trustee.

       

      “Indenture”
means the Indenture dated as of [December 18, 1997] between
the Guarantor and [The Bank of
New York Mellon Corporation], not in its individual capacity but solely
as trustee, and any indenture supplemental thereto pursuant to which the
Debentures are to be issued to the institutional trustee of the
Trust.

       

      “Liquidation
Distribution” has the meaning set forth in the definition of “Guarantee
Payments” herein.

       

      “Majority in
liquidation amount of the Trust-Preferred Securities” means the Holder(s)
of outstanding Trust-Preferred Securities, voting together as a class, but
separately from the holder(s) of the common securities issued in connection with
the Debentures (the “Common
Securities”), of more than 50% of the aggregate liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all Trust-Preferred Securities then
outstanding.

       

      “Obligations”
means any costs, expenses or liabilities (but not including liabilities related
to taxes) of the Trust other than obligations of the Trust to pay to holders of
any Trust-Preferred Securities the amounts due such holders pursuant to the
terms of the Trust-Preferred Securities.

       

      “Officer’s
Certificate” means, with respect to any Person, a certificate signed by
one Authorized Officer of such Person.  Any Officer’s Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee shall include:

       

      (a)   a
statement that the officer signing the Officer’s Certificate has read the
covenant or condition and the definitions relating thereto;

       

      (b)   a brief
statement of the nature and scope of the examination or investigation undertaken
by the officer in rendering the Officer’s Certificate;

       

      (c)   a
statement that the officer has made such examination or investigation as, in
such officer’s opinion, is necessary to enable such officer to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and

       

      (d)   a
statement as to whether, in the opinion of the officer, such condition or
covenant has been complied with.

       

      “Person”
means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated 

       

      
        
          
          

        

        
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      association,
or government or any agency or political subdivision thereof, or any other
entity of whatever nature.

       

      “Responsible
Officer” means, with respect to the Guarantee Trustee, any officer within
the Corporate Trust Office of the Guarantee Trustee including any Vice
President, Assistant Vice President, Secretary, Assistant Secretary or any other
officer of the Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers and also, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of that officer’s knowledge of and familiarity with the
particular subject.

       

      “Successor
Guarantee Trustee” means a successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section
3.1.

       

      “Trust”
has the meaning set forth in the opening paragraph to this
Guarantee.

       

      “Trust-Preferred
Securities” has the meaning set forth in the recitals to this
Guarantee.

       

      ARTICLE
2.

      POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE

       

      Section
2.1 Powers
and Duties of the Guarantee Trustee.

       

      (a)   This
Guarantee shall be held by the Guarantee Trustee for the benefit of the Holders
of the Trust-Preferred Securities, and the Guarantee Trustee shall not transfer
this Guarantee to any Person except a Holder of Trust-Preferred Securities
exercising his or her rights pursuant to Section 4.4(b) or
to a Successor Guarantee Trustee on acceptance by such Successor Guarantee
Trustee of its appointment to act as Successor Guarantee Trustee.  The
right, title and interest of the Guarantee Trustee shall automatically vest in
any Successor Guarantee Trustee, and such vesting and cessation of title shall
be effective whether or not conveyancing documents have been executed and
delivered pursuant to the appointment of such Successor Guarantee
Trustee.

       

      (b)   If an
Event of Default actually known to a Responsible Officer of the Guarantee
Trustee has occurred and is continuing, the Guarantee Trustee shall enforce this
Guarantee for the benefit of the Holders of the Trust-Preferred
Securities.

       

      (c)   The
Guarantee Trustee, before the occurrence of any Event of Default and after
curing all Events of Default that may have occurred, shall undertake to perform
only such duties as are specifically set forth in this Guarantee, and no implied
covenants shall be read into this Guarantee against the Guarantee
Trustee.  In case an Event of Default has occurred (that has not been
waived pursuant to Section 2.4) and
is actually known to a Responsible Officer of the Guarantee Trustee, the
Guarantee Trustee shall exercise such of the rights and powers vested in it by
this Guarantee, and use the same degree of care and skill in its exercise
thereof, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.

       

      
        
          
          

        

        
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      (d)   No
provision of this Guarantee shall be construed to relieve the Guarantee Trustee
from liability for its own negligent action, its own negligent failure to act,
or its own willful misconduct, except that:

       

      (i)   prior to
the occurrence of any Event of Default and after the curing or waiving of all
such Events of Default that may have occurred:

       

      (A)   the
duties and obligations of the Guarantee Trustee shall be determined solely by
the express provisions of this Guarantee, and the Guarantee Trustee shall not be
liable except for the performance of such duties and obligations as are
specifically set forth in this Guarantee, and no implied covenants or
obligations shall be read into this Guarantee against the Guarantee Trustee;
and

       

      (B)   in the
absence of bad faith on the part of the Guarantee Trustee, the Guarantee Trustee
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions furnished to
the Guarantee Trustee and conforming to the requirements of this Guarantee; but
in the case of any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Guarantee Trustee, the
Guarantee Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Guarantee;

       

      (ii)   the
Guarantee Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer of the Guarantee Trustee, unless it shall be
proved that such Responsible Officer of the Guarantee Trustee or the Guarantee
Trustee was negligent in ascertaining the pertinent facts upon which such
judgment was made;

       

      (iii)   the
Guarantee Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the written direction
of the Holders of not less than a Majority in liquidation amount of the
Trust-Preferred Securities relating to the time, method and place of conducting
any proceeding for any remedy available to the Guarantee Trustee, or relating to
the exercise of any trust or power conferred upon the Guarantee Trustee under
this Guarantee; and

       

      (iv)   no
provision of this Guarantee shall require the Guarantee Trustee to expend or
risk its own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers, if the Guarantee Trustee shall have reasonable grounds for believing
that the repayment of such funds is not reasonably assured to it under the terms
of this Guarantee or security and indemnity, reasonably satisfactory to the
Guarantee Trustee, against such risk or liability is not reasonably assured to
it.

       

      Section
2.2 Certain
Rights of Guarantee Trustee.

       

      (a)   Subject
to the provisions of Section
2.1:

       

      
        
          
          

        

        
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      (i)   The
Guarantee Trustee may conclusively rely, and shall be fully protected in acting
or refraining from acting upon, any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed, sent or presented by the
proper party or parties.

       

      (ii)   Any
direction or act of the Guarantor contemplated by this Guarantee shall be
sufficiently evidenced by an Officer’s Certificate.

       

      (iii)   Whenever,
in the administration of this Guarantee, the Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its part,
request and conclusively rely upon an Officer’s Certificate of the Guarantor
which, upon receipt of such request, shall be promptly delivered by the
Guarantor.

       

      (iv)   The
Guarantee Trustee shall have no duty to see to any recording, filing or
registration of any instrument (or any re-recording, refiling or re-registration
thereof).

       

      (v)   The
Guarantee Trustee may consult with counsel of its selection, and the advice or
opinion of such counsel with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in accordance with such advice or
opinion.  Such counsel may be counsel to the Guarantor or any of its
Affiliates and may include any of its employees.  The Guarantee
Trustee shall have the right at any time to seek instructions concerning the
administration of this Guarantee from any court of competent
jurisdiction.

       

      (vi)   The
Guarantee Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Guarantee at the request or direction of any Holder,
unless such Holder shall have provided to the Guarantee Trustee such security
and indemnity, reasonably satisfactory to the Guarantee Trustee, against the
costs, expenses (including attorneys’ fees and expenses and the expenses of the
Guarantee Trustee’s agents, nominees or custodians) and liabilities that might
be incurred by it in complying with such request or direction, including such
reasonable advances as may be requested by the Guarantee Trustee; provided,
however, that nothing contained in this Section 2.2(a)(vi) shall
relieve the Guarantee Trustee, upon the occurrence of an Event of Default, of
its obligation to exercise the rights and powers vested in it by this
Guarantee.

       

      (vii)   The
Guarantee Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the Guarantee Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit.

       

      
        
          
          

        

        
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      (viii)   The
Guarantee Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents, nominees,
custodians or attorneys, and the Guarantee Trustee shall not be responsible for
any misconduct or negligence on the part of any agent or attorney appointed with
due care by it hereunder.

       

      (ix)   Any
action taken by the Guarantee Trustee or its agents hereunder shall bind the
Holders of the Trust-Preferred Securities, and the signature of the Guarantee
Trustee or its agents alone shall be sufficient and effective to perform any
such action.  No third party shall be required to inquire as to the
authority of the Guarantee Trustee to so act or as to its compliance with any of
the terms and provisions of this Guarantee, both of which shall be conclusively
evidenced by the Guarantee Trustee’s or its agent’s taking such
action.

       

      (x)   Whenever
in the administration of this Guarantee the Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or right
or taking any other action hereunder, the Guarantee Trustee (i) may request
instructions from the Holders of a Majority in liquidation amount of the
Trust-Preferred Securities, (ii) may refrain from enforcing such remedy or right
or taking such other action until such instructions are received, and (iii)
shall be protected in conclusively relying on or acting in accordance with such
instructions.

       

      (xi)   The
Guarantee Trustee shall not be liable for any action taken, suffered, or omitted
to be taken by it in good faith, without negligence, and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Guarantee.

       

      (b)   No
provision of this Guarantee shall be deemed to impose any duty or obligation on
the Guarantee Trustee to perform any act or acts or exercise any right, power,
duty or obligation conferred or imposed on it, in any jurisdiction in which it
shall be illegal or in which the Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law to perform any such act or acts or
to exercise any such right, power, duty or obligation.  No permissive
power or authority available to the Guarantee Trustee shall be construed to be a
duty.

       

      Section
2.3 Not
Responsible for Recitals or Issuance of Guarantee.

       

      The
recitals contained in this Guarantee shall be taken as the statements of the
Guarantor, and the Guarantee Trustee does not assume any responsibility for
their correctness.  The Guarantee Trustee makes no representation as
to the validity or sufficiency of this Guarantee.

       

      Section
2.4 Events
of Default; Waiver.

       

      (a)   An Event
of Default under this Guarantee will occur upon the failure of the Guarantor to
perform any of its payment or other obligations hereunder.

       

      (b)   The
Holders of a Majority in liquidation amount of the Trust-Preferred Securities
may, voting or consenting as a class, on behalf of the Holders of all of the
Trust-Preferred Securities, waive any past Event of Default and its
consequences.  Upon such waiver, 

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      any such
Event of Default shall cease to exist, and shall be deemed to have been cured,
for every purpose of this Guarantee, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.

       

      Section
2.5 Events
of Default; Notice.

       

      (a)   The
Guarantee Trustee shall, within 90 days after the occurrence of an Event of
Default, transmit by mail, first class postage prepaid, to the Holders of the
Trust-Preferred Securities and the Guarantor, notices of all Events of Default
actually known to a Responsible Officer of the Guarantee Trustee, unless such
defaults have been cured before the giving of such notice, provided, however,
that the Guarantee Trustee shall be protected in withholding such notice if and
so long as a Responsible Officer of the Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders of the Trust-Preferred Securities.

       

      (b)   The
Guarantee Trustee shall not be deemed to have knowledge of any Event of Default
unless the Guarantee Trustee shall have received written notice from the
Guarantor or a Holder of the Trust-Preferred Securities (except in the case of a
payment default), or a Responsible Officer of the Guarantee Trustee charged with
the administration of this Guarantee shall have obtained actual knowledge
thereof.

       

      ARTICLE
3.

      GUARANTEE
TRUSTEE

       

      Section
3.1 Guarantee
Trustee; Eligibility.

       

      (a)   There
shall at all times be a Guarantee Trustee which shall:

       

      (i)   not be an
Affiliate of the Guarantor, and

       

      (ii)   be a
corporation organized and doing business under the laws of the United States of
America or any State or Territory thereof or of the District of Columbia, or
Person authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least 50 million U.S. dollars ($50,000,000),
and subject to supervision or examination by Federal, State, Territorial or
District of Columbia authority.  If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements of the
supervising or examining authority referred to above, then, for the purposes of
this Section 3.1(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published.

       

      (b)   If at any
time the Guarantee Trustee shall cease to be eligible to so act under Section 3.1(a), the
Guarantee Trustee shall immediately resign in the manner and with the effect set
out in Section
3.2(c).

       

      (c)   If the
Guarantee Trustee has or shall acquire any “conflicting interest” within the
meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee
shall 

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      either
eliminate such interest or resign to the extent and in the manner provided by,
and subject to this Guarantee.

       

      Section
3.2 Appointment,
Removal and Resignation of Guarantee Trustee.

       

      (a)   Subject
to Section 3.2(b), the
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor except during an Event of Default.

       

      (b)   The
Guarantee Trustee shall not be removed in accordance with Section 3.2(a) until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
by written instrument executed by such Successor Guarantee Trustee and delivered
to the Guarantor.

       

      (c)   The
Guarantee Trustee appointed to office shall hold office until a Successor
Guarantee Trustee shall have been appointed or until its removal or
resignation.  The Guarantee Trustee may resign from office (without
need for prior or subsequent accounting) by an instrument in writing executed by
the Guarantee Trustee and delivered to the Guarantor, which resignation shall
not take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by an instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.

       

      (d)   If no
Successor Guarantee Trustee shall have been appointed and accepted appointment
as provided in this Section 3.2
within 60 days after delivery of an instrument of removal or resignation, the
Guarantee Trustee resigning or being removed may petition any court of competent
jurisdiction for appointment of a Successor Guarantee Trustee.  Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Guarantee Trustee.

       

      (e)   No
Guarantee Trustee shall be liable for the acts or omissions to act of any
Successor Guarantee Trustee.

       

      (f)   Upon
termination of this Guarantee or removal or resignation of the Guarantee Trustee
pursuant to this Section 3.2, the
Guarantor shall pay to the Guarantee Trustee all amounts owing to the Guarantee
Trustee under Section 7.2 and
Section 7.3
accrued to the date of such termination, removal or resignation.

       

      ARTICLE
4.

      GUARANTEE

       

      Section
4.1 Guarantee.

       

      (a)   The
Guarantor irrevocably and unconditionally agrees to pay in full to the Holders
the Guarantee Payments (without duplication of amounts theretofore paid by the
Trust), as and when due, regardless of any defense (except the defense of
payment by the Trust), right of set-off or counterclaim that the Trust may have
or assert.  The Guarantor’s obligation to make a Guarantee Payment may
be satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Trust or CBC to pay such amounts to the
Holders.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      (b)   The
Guarantor hereby also agrees to assume any and all Obligations of the Trust and
in the event any such Obligation is not so assumed, subject to the terms and
conditions hereof, the Guarantor hereby irrevocably and unconditionally
guarantees to each Beneficiary the full payment, when and as due, of any and all
Obligations to such Beneficiaries.  This Guarantee is intended to be
for the benefit of, and to be enforceable by, all such Beneficiaries, whether or
not such Beneficiaries have received notice hereof.

       

      Section
4.2 Waiver
of Notice and Demand.

       

      The
Guarantor hereby waives notice of acceptance of this Guarantee and of any
liability to which it applies or may apply, presentment, demand for payment, any
right to require a proceeding first against the Trust or any other Person before
proceeding against the Guarantor, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.

       

      Section
4.3 Obligations
Not Affected.

       

      The
obligations, covenants, agreements and duties of the Guarantor under this
Guarantee shall in no way be affected or impaired by reason of the happening
from time to time of any of the following:

       

      (a)   the
release or waiver, by operation of law or otherwise, of the performance or
observance by the Trust of any express or implied agreement, covenant, term or
condition relating to the Trust-Preferred Securities to be performed or observed
by the Trust;

       

      (b)   the
extension of time for the payment by the Trust of all or any portion of any sums
payable under the terms of the Trust-Preferred Securities or the extension of
time for the performance of any other obligation under, arising out of, or in
connection with, the Trust-Preferred Securities (other than an extension of time
for payment of all or any portion of any sums payable that result from the
extension of any interest payment period on the Debentures or any extension of
the maturity of the Debentures permitted by the Debenture
Documents);

       

      (c)   any
failure, omission, delay or lack of diligence on the part of the Holders to
enforce, assert or exercise any right, privilege, power or remedy conferred on
the Holders pursuant to the terms of the Trust-Preferred Securities, or any
action on the part of the Trust granting indulgence or extension of any
kind;

       

      (d)   the
voluntary or involuntary liquidation, dissolution, sale of any collateral,
receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition

       

      (e)   or
readjustment of debt of, or other similar proceedings affecting, the Trust or
any of the assets of the Trust;

       

      (f)   any
invalidity of, or defect or deficiency in, the Trust-Preferred
Securities;

       

      (g)   the
settlement or compromise of any obligation guaranteed hereby or hereby incurred;
or any other circumstance whatsoever that might otherwise constitute a legal or

       

      
        
          
          

        

        
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      equitable
discharge or defense of a guarantor, it being the intent of this Section 4.3 that
the obligations of the Guarantor hereunder shall be absolute and unconditional
under any and all circumstances.  There shall be no obligation of the
Holders to give notice to, or obtain consent of, the Guarantor with respect to
the happening of any of the foregoing.

       

      Section
4.4 Rights
of Holders.

       

      (a)   The
Holders of a Majority in liquidation amount of the Trust-Preferred Securities
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee in respect of this Guarantee
or to direct the exercise of any trust or power conferred upon the Guarantee
Trustee under this Guarantee; provided, however, that (subject to Section 2.1) the
Guarantee Trustee shall have the right to decline to follow any such direction
if the Guarantee Trustee being advised by counsel determines that the action or
proceeding so directed may not lawfully be taken or if the Guarantee Trustee in
good faith by its board of directors or trustees, executive committees or a
trust committee of directors or trustees and/or Responsible Officers shall
determine that the action or proceedings so directed would involve the Guarantee
Trustee in personal liability.

       

      (b)   Any
Holder of Trust-Preferred Securities may institute a legal proceeding directly
against the Guarantor to enforce the Guarantee Trustee’s rights under this
Guarantee, without first instituting a legal proceeding against the Trust, the
Guarantee Trustee or any other Person.  The Guarantor waives any right
or remedy to require that any such action be brought first against the Trust,
the Guarantee Trustee or any other Person before so proceeding directly against
the Guarantor.

       

      Section
4.5 Guarantee
of Payment.

       

      This
Guarantee creates a guarantee of payment and not of collection.

       

      Section
4.6 Subrogation.

       

      The
Guarantor shall be subrogated to all (if any) rights of the Holders of
Trust-Preferred Securities against the Trust and CBC in respect of any amounts
paid to such Holders by the Guarantor under this Guarantee; provided, however,
that the Guarantor shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any right that it may
acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Guarantee, if, after
giving effect to any such payment, any amounts are due and unpaid under this
Guarantee.  If any amount shall be paid to the Guarantor in violation
of the preceding sentence, the Guarantor agrees to hold such amount in trust for
the Holders and to pay over such amount to the Holders.

       

      Section
4.7 Independent
Obligations.

       

      The
Guarantor acknowledges that its obligations hereunder are independent of the
obligations of the Trust and CBC with respect to the Trust-Preferred Securities
and that the Guarantor shall be liable as principal and as debtor hereunder to
make Guarantee Payments pursuant to the terms of this Guarantee notwithstanding
the occurrence of any event referred to in subsections (a) through (g),
inclusive, of Section 4.3
hereof.

       

      
        
          
          

        

        
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      Section
4.8 Enforcement
by a Beneficiary.

       

      A
Beneficiary may enforce the obligations of the Guarantor contained in Section 4.1(b)
directly against the Guarantor and the Guarantor waives any right or remedy to
require that any action be brought against the Trust or any other person or
entity before proceeding against the Guarantor.  The Guarantor shall
be subrogated to all rights (if any) of any Beneficiary against the Trust in
respect of any amounts paid to the Beneficiaries by the Guarantor under this
Guarantee; provided, however, that the Guarantor shall not (except to the extent
required by mandatory provisions of law) be entitled to enforce or exercise any
rights that it may acquire by way of subrogation or any indemnity, reimbursement
or other agreement, in all cases as a result of payment under this Guarantee, if
at the time of any such payment, and after giving effect to such payment, any
amounts are due and unpaid under this Guarantee.

       

      ARTICLE
5.

      LIMITATION OF TRANSACTIONS;
SUBORDINATION

       

      Section
5.1 Limitation
of Transactions.

       

      So long
as any Trust-Preferred Securities remain outstanding, if (a) there shall have
occurred and be continuing an Event of Default or there shall have occurred and
be continuing a default applicable to the Trust or CBC under the Debenture
Documents (a “CBC
Default”) or (b) CBC or the Trust shall have selected an extension
of any payment obligation under any Debenture Document (each, an “Extension
Period”) and such period, or any extension thereof, shall have commenced
and be continuing, then the Guarantor shall not and shall not permit any
Affiliate to (x) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, any of the
Guarantor’s or such Affiliate’s capital stock (other than payments of dividends
or distributions to the Guarantor) or make any guarantee payments with respect
to the foregoing;
provided, however, that a dividend distribution in the form of capital
stock of a subsidiary of the Guarantor paid on or with respect to the capital
stock of the Guarantor is permitted if the subsidiary becomes a co-guarantor
with the Guarantor under the Guarantee Agreement prior to such dividend
distribution or (y) make any payment of principal of or interest or premium, if
any, on or repay, repurchase or redeem any debt securities of the Guarantor or
any Affiliate (other than, with respect to clauses (x) and (y) above,
(i) repurchases, redemptions or other acquisitions of shares of capital
stock of the Guarantor in connection with any employment contract, benefit plan
or other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of capital
stock of the Guarantor (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the occurrence of the Event of Default, CBC Default or Extension Period, as
applicable, (ii) as a result of any exchange or conversion of any class or
series of the Guarantor’s capital stock (or any capital stock of a subsidiary of
the Guarantor) for any class or series of the Guarantor’s capital stock or of
any class or series of the Guarantor’s indebtedness for any class or series of
the Guarantor’s capital stock, (iii) the purchase of fractional interests
in shares of the Guarantor’s capital stock pursuant to the conversion or
exchange provisions of such capital stock or the security being converted or
exchanged, (iv) any declaration of a dividend in connection with any
stockholders’ rights plan, or the issuance of rights, stock or other property
under any stockholders’ rights plan, or the 

       

      
        
          
          

        

        
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      redemption
or repurchase of rights pursuant thereto, (v) any dividend in the form of
stock, warrants, options or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other rights is the same
stock as that on which the dividend is being paid or ranks pari passu with or junior to
such stock and any cash payments in lieu of fractional shares issued in
connection therewith, or (vi) payments under this Guarantee).

       

      Section
5.2 Ranking.

       

      This
Guarantee will constitute an unsecured obligation of the Guarantor and will rank
subordinate and junior in right of payment to all present and future
indebtedness of the Guarantor.  The right of the Guarantor to
participate in any distribution of assets of any of its subsidiaries upon any
such subsidiary’s liquidation or reorganization or otherwise is subject to the
prior claims of creditors of that subsidiary, except to the extent the Guarantor
may itself be recognized as a creditor of that
subsidiary.  Accordingly, the Guarantor’s obligations under this
Guarantee will be effectively subordinated to all existing and future
liabilities of the Guarantor’s subsidiaries, and claimants should look only to
the assets of the Guarantor for payments hereunder.  This Guarantee
does not limit the incurrence or issuance of other secured or unsecured debt of
the Guarantor under any indenture that the Guarantor may enter into in the
future or otherwise.

       

      ARTICLE
6.

      TERMINATION

       

      Section
6.1 Termination.

       

      This
Guarantee shall terminate as to the Trust-Preferred Securities (i) upon
full payment in connection with a complete redemption of all Trust-Preferred
Securities then outstanding, (ii) upon the distribution of all of the
Debentures to the Holders of all of the Trust-Preferred Securities or
(iii) upon full payment of the amounts payable in accordance with the
Debenture Documents upon dissolution of the Trust.  This Guarantee
will continue to be effective or will be reinstated, as the case may be, if at
any time any Holder of Trust-Preferred Securities must restore payment of any
sums paid under the Trust-Preferred Securities or under this
Guarantee.

       

      ARTICLE
7.

      INDEMNIFICATION

       

      Section
7.1 Exculpation.

       

      (a)   No
Indemnified Person shall be liable, responsible or accountable in damages or
otherwise to the Guarantor or any Covered Person for any loss, damage or claim
incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Guarantee and in a
manner that such Indemnified Person reasonably believed to be within the scope
of the authority conferred on such Indemnified Person by this Guarantee or by
law, except that an Indemnified Person shall be liable for any such loss, damage
or claim incurred by reason of such Indemnified Person’s negligence or willful
misconduct with respect to such acts or omissions.

       

      
        
          
          

        

        
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      (b)   An
Indemnified Person shall be fully protected in relying in good faith upon the
records of the Trust or the Guarantor and upon such information, opinions,
reports or statements presented to the Trust or the Guarantor by any Person as
to matters the Indemnified Person reasonably believes are within such other
Person’s professional or expert competence and who, if selected by such
Indemnified Person, has been selected with reasonable care by such Indemnified
Person, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Trust-Preferred Securities might properly be paid.

       

      Section
7.2 Indemnification.

       

      (a)   The
Guarantor agrees to indemnify each Indemnified Person for, and to hold each
Indemnified Person harmless against, any and all loss, liability, damage, claim
or expense incurred without negligence or willful misconduct on the part of the
Indemnified Person, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including, but not limited to,
the costs and expenses (including reasonable legal fees and expenses) of the
Indemnified Person defending itself against, or investigating, any claim or
liability in connection with the exercise or performance of any of the
Indemnified Person’s powers or duties hereunder.  The obligation to
indemnify as set forth in this Section 7.2 shall
survive the resignation or removal of the Guarantee Trustee and the termination
of this Guarantee.

       

      (b)   Promptly
after receipt by an Indemnified Person under this Section 7.2 of
notice of the commencement of any action, such Indemnified Person will, if a
claim in respect thereof is to be made against the Guarantor under this Section 7.2,
notify the Guarantor in writing of the commencement thereof; but the failure so
to notify the Guarantor (i) will not relieve the Guarantor from liability
under paragraph (a) above unless and to the extent that the Guarantor did not
otherwise learn of such action and such failure results in the forfeiture by the
Guarantor of substantial rights and defenses and (ii) will not, in any
event, relieve the Guarantor from any obligations to any Indemnified Person
other than the indemnification obligation provided in paragraph (a)
above.  The Guarantor shall be entitled to appoint counsel of the
Guarantor’s choice at the Guarantor’s expense to represent the Indemnified
Person in any action for which indemnification is sought (in which case the
Guarantor shall not thereafter be responsible for the fees and expenses of any
separate counsel retained by the Indemnified Person or Persons except as set
forth below); provided, however, that such counsel shall be reasonably
satisfactory to the Indemnified Person.  Notwithstanding the
Guarantor’s election to appoint counsel to represent the Guarantor in an action,
the Indemnified Person shall have the right to employ separate counsel
(including local counsel), and the Guarantor shall bear the reasonable fees,
costs and expenses of such separate counsel if (i) the use of counsel
chosen by the Guarantor to represent the Indemnified Person would present such
counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the Indemnified
Person and the Guarantor and the Indemnified Person shall have reasonably
concluded that there may be legal defenses available to it and/or other
Indemnified Person(s) which are different from or additional to those available
to the Guarantor, (iii) the Guarantor shall not have employed counsel
satisfactory to the Indemnified Person to represent the Indemnified Person
within a reasonable time after notice of the institution of such action or

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

      (iv) the
Guarantor shall authorize the Indemnified Person to employ separate counsel at
the expense of the Guarantor.  The Guarantor will not, without the
prior written consent of the Indemnified Persons, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the Indemnified Persons are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each Indemnified
Person from all liability arising out of such claim, action, suit or
proceeding.

       

      Section
7.3 Compensation;
Reimbursement of Expenses.

       

      The
Guarantor agrees:

       

      (a)   to pay to
the Guarantee Trustee from time to time such compensation for all services
rendered by it hereunder as the parties shall agree to from time to time (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust); and

       

      (b)   except as
otherwise expressly provided herein, to reimburse the Guarantee Trustee upon
request for all reasonable expenses, disbursements and advances incurred or made
by it in accordance with any provision of this Guarantee (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or willful misconduct.

       

      For
purposes of clarification, this Section 7.3 does
not contemplate the payment by the Guarantor of acceptance or annual
administration fees owing to the Guarantee Trustee for services to be provided
by the Guarantee Trustee under this Guarantee.  The provisions of this
Section 7.3 shall
survive the resignation or removal of the Guarantee Trustee and the termination
of this Guarantee.

       

      ARTICLE
8.

      MISCELLANEOUS

       

      Section
8.1 Successors
and Assigns.

       

      All
guarantees and agreements contained in this Guarantee shall bind the successors,
assigns, receivers, trustees and representatives of the Guarantor and shall
inure to the benefit of the Holders of the Trust-Preferred Securities then
outstanding.  Except in connection with any merger or consolidation of
the Guarantor with or into another entity or any sale, transfer or lease of the
Guarantor’s assets to another entity, in each case, to the extent permitted
under the Indenture, the Guarantor may not assign its rights or delegate its
obligations under this Guarantee without the prior approval of the Holders of at
least a Majority in liquidation amount of the Trust-Preferred
Securities.

       

      Section
8.2 Amendments.

       

      Except
with respect to any changes that do not adversely affect the rights of Holders
of the Trust-Preferred Securities in any material respect (in which case no
consent of Holders will 

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

      be
required), this Guarantee may be amended only with the prior approval of the
Holders of not less than a Majority in liquidation amount of the Trust-Preferred
Securities.  The provisions of the Declaration with respect to
amendments thereof apply to the giving of such approval.

       

      Section
8.3 Notices.

       

      All
notices provided for in this Guarantee shall be in writing, duly signed by the
party giving such notice, and shall be delivered, telecopied or mailed by first
class mail, as follows:

       

      
        	
                (a)
      If given to the Guarantee Trustee, at the Guarantee Trustee’s mailing
      address set forth below (or such other address as the Guarantee Trustee
      may give notice of to the Holders of the Trust-Preferred Securities and
      the Guarantor):

                 

                [The
      Bank of New York Mellon Corporation

                2
      N. LaSalle Street, Suite 1020

                Chicago,
      IL 60602]

                Attention:
      [__________]

                Telecopy:  [__________]

                 

              
	
                (b)
      If given to the Guarantor, at the Guarantor’s mailing address set forth
      below (or such other address as the Guarantor may give notice of to the
      Holders of the Trust-Preferred Securities and to the Guarantee
      Trustee):

                 

                Michigan
      Commerce Bancorp Limited

                222
      Washington Square North, Suite One

                Lansing,
      Michigan 48933

                Attention:
      [__________]

                Telecopy:
      [__________]

                 

              
	
                (c)
      If given to any Holder of the Trust-Preferred Securities, at the address
      set forth on the books and records of the Trust.

                 

                All
      such notices shall be deemed to have been given when received in person,
      telecopied with receipt confirmed, or mailed by first class mail, postage
      prepaid, except that if a notice or other document is refused delivery or
      cannot be delivered because of a changed address of which no notice was
      given, such notice or other document shall be deemed to have been
      delivered on the date of such refusal or inability to
    deliver.

              

      

      

      Section
8.4 Benefit.

       

      This
Guarantee is solely for the benefit of the Beneficiaries and, subject to Section 2.1, is
not separately transferable from the Trust-Preferred Securities.

       

      Section
8.5 Governing
Law.

       

      THIS
GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK, 

       

      
        
          
          

        

        
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      WITHOUT
REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF THE
NEW YORK GENERAL OBLIGATIONS LAW).

       

      Section
8.6 Counterparts.

       

      This
Guarantee may be executed in one or more counterparts, each of which shall be an
original, but all of which taken together shall constitute one and the same
instrument.

       

      Section
8.7 Separability.

       

      In case
one or more of the provisions contained in this Guarantee shall for any reason
be held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provisions of this
Guarantee, but this Guarantee shall be construed as if such invalid or illegal
or unenforceable provision had never been contained herein.

       

      

      Signatures
appear on the following page

      
        
           

        

        
          18

          
            

          

        

        
           

        

      

      THIS
GUARANTEE is executed as of the day and year first above written.

       

      MICHIGAN
COMMERCE BANCORP LIMITED,

      as
Guarantor

      

      By:
_______________________________                                                                

      Name:

      Title:

      

      

      

      [THE
BANK OF NEW YORK MELLON CORPORATION, as Guarantee Trustee]

      

      By: _______________________________                                                               

      Name:

      Title:

      
        
           

        

        
          19

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