Document:

Exhibit 10.1

 

PURCHASE AGREEMENT

$25,000,000

VCBI CAPITAL TRUST IV

 

THIS
AGREEMENT (the “Agreement”), made as of this 22 day of September, 2008 by and
among Virginia Commerce Bancorp, Inc., a Virginia corporation (the “Company”),
VCBI Capital Trust IV, a Delaware statutory trust (the “Trust and together with
the Company, the Offerors”) and the purchasers identified on the signature pages attached
hereto (each a “Purchaser and collectively the “Purchasers”).

 

WHEREAS,
the Trust and Company desire that the Trust issue and sell, and the Purchasers
desire to purchase, in the aggregate, 25,000 of the 10.20% preferred securities
(liquidation amount of $1,000.00 per security) of the Trust (the “Preferred
Securities”), which such Preferred Securities shall be guaranteed by the
Company to the extent provided in the Guarantee Agreement, to be dated as of
the Closing Date (as defined in Section 2(a) hereof) (the “Guarantee
Agreement”), between the Company, as guarantor, and Wilmington Trust Company,
as guarantee trustee (the “Guarantee Trustee”), with respect to distributions
and payments upon liquidation, redemption and otherwise.

 

WHEREAS,
the entire proceeds from the sale of the Preferred Securities will be combined
with the entire proceeds from the sale by the Trust to the Company of its
common securities (the “Common Securities”), and will be used by the Trust to
purchase the relevant portion of the $25,775,000.00 aggregate principal amount
of 10.20% Junior Subordinated Debentures due 2038 (the “Debentures”) issued by
the Company, which Debentures will be issued pursuant to the Indenture, to be
dated as of the Closing Date (the “Indenture”), between the Company and
Wilmington Trust Company, as indenture trustee (the “Indenture Trustee”).

 

WHEREAS,
the Preferred Securities and the Common Securities will be issued pursuant to
the Amended and Restated Declaration of Trust, to be dated as of the Closing
Date (the “Declaration”), among the Company, as sponsor, the Administrators
named therein (the “Administrators”), Wilmington Trust Company, as Property
Trustee (the “Property Trustee”), Wilmington Trust Company, as Delaware trustee
(the “Delaware Trustee”), and the holders, from time to time, of undivided
beneficial interests in the assets of the Trust, the Indenture, the Guarantee
Agreement, the Declaration, the Warrants and this Agreement (as defined in Section 2(a) hereof)
hereinafter being referred to collectively as the “Operative Documents.”

 

WHEREAS,
as a further inducement to the purchase of the Preferred Securities, the
Company desires that there be issued to each Purchaser, warrants to purchase 60
shares of the common stock $1.00 par value, of the Company (the “Common Stock”)
for each $1,000.00 of liquidation amount of Preferred Securities purchased,
which such Warrants shall be exercisable immediately upon issuance and through
the fifth anniversary of issuance, at an exercise price per share (payable in
cash, or when the Company is not restricted from acquiring or repurchasing
shares of its common stock, in shares of common stock, or a combination
thereof) of Common Stock equal to 120%
of the average of the closing prices of the Company’s common stock on the
Nasdaq Global Select Market for the five trading days immediately preceding the
Closing Date, but in no event lower than the market value of the common stock
on the day prior to the date of execution of the Purchase Agreement.

 

NOW,
THEREFORE, in consideration of the premises, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound hereby, the parties hereto agree as follows:

 

SECTION 1.
Purchase and Sale of Preferred Securities;
Warrants; Closing.

 

(a) Subject
to the terms and conditions of this Agreement, each Purchaser severally, and
not jointly, hereby agrees that at Closing, such Purchaser shall purchase from
the Trust the number of Preferred Securities set forth opposite such Purchaser’s
name on the signature page hereof, at a purchase price of $1,000.00 per
Preferred Security, and the Trust agrees that it shall sell such Preferred
Securities to Purchaser, against payment therefor. The Purchasers, the Company
and the Trust hereby agree that no commission, discount or other payment or
credit is due or payable to Purchaser by the Company or Trust in respect of the
purchase and sale of Securities (as hereinafter defined). The Company agrees
that it shall issue Warrants having the terms set forth above to each Purchaser
at the rate of 60 shares of Common Stock for each $1,000.00 liquidation amount
of Preferred Securities purchased. For 

 

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purposes of this Agreement,
the Preferred Securities, the Warrants and the shares of Common Stock issuable
upon exercise of the Warrants are occasionally referred to collectively as the “Securities.”  In the event of any stock split, subdivision,
dividend or distribution payable in shares of common stock (or other securities
or rights convertible into, or entitling the holder thereof to receive shares
of common stock) combination or other similar event occurring after the date
hereof but prior to the Closing Date, the number of shares subject to the
Warrants and the exercise price thereof shall be appropriately adjusted to
reflect such event.

 

(b) The
date on which the purchase and sale of Preferred Securities shall close shall
be September 23, 2008, or such later date not later than 7 business days
after the date hereof, as the Offerors may designate, but not later than September 29,
2008 (the “Closing Date”). On the Closing Date, the Preferred Securities and
the Warrants shall be issued in definitive form, registered in the name(s) and
denomination(s) specified by the respective Purchasers. Delivery of any
certificate(s) representing the Preferred Securities shall be made by the
Trust to or on behalf of the Purchasers at the offices of the Company, and
payment of the purchase price for the Preferred Securities shall be made by the
Purchasers to the Trust by wire transfer of immediately available funds to a
bank designated by the Company, contemporaneous with closing on the Closing
Date.

 

SECTION 2.
Representations and Warranties of the Offerors.

 

(a)           The Trust and the Company, jointly and severally, represent and warrant
to the Purchasers as of the date hereof and as of the Closing Date, except as
set forth in the Company’s disclosure schedule dated as of the date hereof, and
agree with the Purchasers, as follows:

 

(i) Similar Offerings. Within a period of six months before or
after the date hereof, the Offerors have not, directly or indirectly, solicited
any offer to buy or offered to sell, and will not, directly or indirectly,
solicit any offer to buy or offer to sell, in the United States or to any
United States citizen or resident, any security which is or would be integrated
with the sale of the Securities (including any securities of the same or a
similar classes as any of the Securities) in a manner that would require the
Securities to be registered under the Securities Act of 1933, as amended (the “1933
Act”).

 

(ii) Incorporated Documents. The documents of the Company filed
with the Securities and Exchange Commission (the “Commission”) in accordance
with the Securities Exchange Act of 1934, as amended (the “1934 Act”), from and
including the commencement of the fiscal year covered by the Company’s most
recent Annual Report on Form 10-K, at the time they were or hereafter are
filed by the Company with the Commission (collectively, the “1934 Act Reports”),
complied and will comply in all material respects with the requirements of the
1934 Act and the rules and regulations of the Commission thereunder (the “1934
Act Regulations”), and, at the date of this Agreement and on the Closing Date,
do not and will not include an 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 the light of the circumstances under which they were
made, not misleading; and other than such instruments, agreements, contracts
and other documents as are filed as exhibits to the Company’s Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q or Current Reports on Form 8-K, there
are no instruments, agreements, contracts or documents of a character described
in Item 601 of Regulation S-K promulgated by the Commission to which the
Company or any of its subsidiaries is a party. As of the date hereof, the
Company is not aware of any event occurring on or prior to the Closing Date
(other than the transactions contemplated hereby and by the Operative
Documents) that requires the filing of a Form 8-K after the Closing.

 

(iii) Independent Accountants. The accountants of the Company who
certified the financial statements included in the 1934 Act Reports (the “Independent
Accountants”) are independent public accountants of the Company and its
subsidiaries within the meaning of the 1933 Act and the rules and
regulations of the Commission thereunder (the “1933 Act Regulations”).

 

(iv) Financial Statements and Information. The consolidated
historical financial statements of the Company, together with the related
schedules and notes, included in the 1934 Act Reports present fairly, in all
material respects, the respective consolidated financial positions of the
Company and its consolidated subsidiaries at the respective dates indicated,
and the consolidated statements of income, changes in stockholders’ equity and
cash flows of the Company and its consolidated subsidiaries for the respective
periods specified; said financial statements have been prepared in conformity
with generally accepted accounting principles in the United States applied on a

 

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consistent basis throughout
the periods involved, except as disclosed in the notes to such financial
statements; the supporting schedules, if any, included in the 1934 Act Reports
present fairly, in all material respects, the information required to be stated
therein.

 

(v) No Material Adverse Change. Since the date as of which
information is given in the Company’s most recent quarterly report on Form 10-Q,
except as reflected in subsequent 1934 Reports there has not been: (A) any
material adverse change in the condition, financial, regulatory or otherwise,
or in the earnings, business affairs or business prospects of the Trust or of
the Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business (a “Material Adverse Effect”), (B) any
dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock; (C) the Company has not purchased or
redeemed, or agreed to purchase or redeem, any shares of its capital stock, and
has not issued any shares of capital stock (except upon the exercise of options
outstanding as of the date of the most recent Form 10-Q), and the Company
has not granted, or except as contemplated hereby, agreed to grant any option
or other right to acquire shares of its capital stock, to any director,
executive officer or other affiliate of the Company; (D) the Company has
not altered its method of accounting or the manner in which it maintains its
books and records, except as required by generally accepted accounting
principles or applicable law or regulation; and (E) except in the ordinary
course of the Company’s business, there has not been any material change or
amendment to, or waiver under, any material contract under which the Company or
any of its assets are bound or subject.

 

(vi) Internal Accounting Controls. Each of the Company and its
subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in
accordance with the management’s general or specific authorizations, (ii) transactions
are recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain asset
accountability, (iii) access to assets is permitted only in accordance
with the management’s general or specific authorization and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.

 

(vii) SOX;
Disclosure Controls. The Company is in
material compliance with the provisions of the Sarbanes-Oxley Act of 2002 which
are applicable to it as of the date hereof. The Company has established and
maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and
15d-15(e) under the 1934 Act); such disclosure controls and procedures (i) are
designed to ensure that material information relating to the Company, including
its consolidated subsidiaries, is made known to the Company’s Chief Executive
Officer and its Chief Financial Officer by others within those entities,
particularly during the periods in which the 1934 Act Reports are being
prepared, (ii) have been evaluated for effectiveness as of the end of the
annual or quarterly period reported to the Commission and (iii) are
effective to perform the functions for which they were established; the Company’s
auditors and the Audit Committee of the Board of Directors have been advised
of: (A) any significant deficiencies in the design or operation of
internal controls which could adversely affect the Company’s ability to record,
process, summarize, and report financial data and (B) any fraud, whether
or not material, that involves management or other employees who have a role in
the Company’s internal controls; any material weaknesses in internal controls
have been identified for the Company’s auditors; and since the date of the most
recent evaluation of such disclosure controls and procedures, there have been
no significant changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective actions with
regard to significant deficiencies and material weaknesses.

 

(viii) Regulatory Matters. Neither the Company nor any of its
subsidiaries is subject or is party to, or has received any notice or advice
that any of them may become subject or party to any investigation with respect
to, any corrective, suspension or cease-and-desist order, agreement, consent
agreement, memorandum of understanding or other regulatory enforcement action,
proceeding or order with or by, or is a party to any commitment letter or
similar undertaking to, or is subject to any directive by, or has been a
recipient of any supervisory letter from, or has adopted any board resolutions
at the request of, any Regulatory Agency (as defined below) that currently
relates to or restricts in any material respect the conduct of their business
or that in any manner relates to their capital adequacy, credit policies,
management or business (each, a “Regulatory Agreement”), nor has the Company or
any of its subsidiaries been advised by any Regulatory Agency that it is
considering issuing or requesting any such Regulatory Agreement; there is no
unresolved violation, criticism or exception by any Regulatory Agency with
respect to any report or statement relating to any examinations of the Company
or any of its subsidiaries which, in the reasonable judgment of the Company, is
expected to result in a Material Adverse Effect. 

 

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As used herein, the term “Regulatory
Agency” means any federal or state agency charged with the supervision or
regulation of depositary institutions or holding companies of depositary
institutions, or engaged in the insurance of depositary institution deposits,
or any court, administrative agency or commission or other governmental agency,
authority or instrumentality having supervisory or regulatory authority with
respect to the Company or any of its subsidiaries.

 

(ix) No Undisclosed Liabilities. Neither the Company nor any of
its subsidiaries has any material liability, whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become
due, including any liability for taxes (and there is no past or present fact,
situation, circumstance, condition or other basis for any present or future
action, suit, proceeding, hearing, charge, complaint, claim or demand against
the Company or its subsidiaries giving rise to any such liability), except (i) for
liabilities set forth in the financial statements referred to in Section 1(a)(iv) above
and (ii) normal fluctuations in the amount of the liabilities referred to
in clause (i) above occurring in the ordinary course of business of the
Company and all of its subsidiaries since the date of the most recent balance
sheet included in such financial statements. There is no transaction,
arrangement or other relationship between the Company and an unconsolidated or
other “off-balance sheet” entity that is required to be disclosed in the 1934
Act Reports that is not so disclosed, where such transaction, arrangement or
relationship could reasonably be expected to result in a Material Adverse
Effect.

 

(x) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing under the
laws of the Commonwealth of Virginia and has full power and authority under
such laws to own, lease and operate its properties and to conduct its business,
to enter into and perform its obligations under each of the Operative Documents
to which it is a party, and to issue the Debentures, the Warrants and the
shares of common stock issuable upon exercise of the Warrants (the “Warrant
Shares”); and the Company is duly registered as a bank holding company under
the Bank Holding Company Act of 1956, as amended.

 

(xi)
Good Standing of the Subsidiaries. Each “significant
subsidiary” (as defined in Rule 1-02 of Regulation S-X) of the Company (a “Significant
Subsidiary”) has been duly organized and is validly existing as an entity in
good standing under the laws of the jurisdiction in which it is chartered and
has full power and authority under such laws to own, lease and operate its
properties and to conduct its current and contemplated business; and the
deposit accounts of each of the Company’s subsidiary banks are insured up to
the applicable limits by the Deposit Insurance Fund of the Federal Deposit
Insurance Corporation (the “FDIC”) to the fullest extent permitted by law and
the rules and regulations of the FDIC, and no proceeding for the
revocation or termination of such insurance is pending or, to the knowledge of
the Company, threatened.

 

(xii)
Foreign Qualifications. Each of the
Company and its subsidiaries is duly qualified as a foreign entity to transact
business and is each in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to be so qualified
would not singularly, or in the aggregate, in the reasonable judgment of the
Company, be expected to result in a Material Adverse Effect.

 

(xiii)
Capital Stock Duly Authorized and Validly Issued.
All of the issued and outstanding capital stock of the Company has been duly
authorized and validly issued and is fully paid and nonassessable; all of the
issued and outstanding capital stock of each Significant Subsidiary of the
Company has been duly authorized and validly issued, is fully paid and nonassessable
and is owned by the Company, directly or through subsidiaries, free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
equitable right; and none of the issued and outstanding capital stock of the
Company or its Significant Subsidiaries was issued in violation of any
preemptive or similar rights arising by operation of law, under the charter,
by-laws or code of regulations of the Company or any of its Significant
Subsidiaries or under any agreement to which the Company or any of its
Significant Subsidiaries is a party.

 

(xiv)        Capitalization. The
authorized capital stock of the Company consists of 50,000,000 shares of common
stock, and 1,000,000 shares of undesignated preferred stock. Except for changes
in the number of outstanding shares of common stock upon the exercise of
options under the Company’s equity compensation plans which were outstanding as
of June 30, 2008, there has been no change in the number of outstanding
shares of common stock from the number reported in the Company’s Form 10-Q
for the period ended June 30, 2008. There 

 

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are no shares of any class
or series of the Company’s preferred stock outstanding. All of the issued and
outstanding shares of common stock are duly and validly issued and outstanding
and are fully paid and nonassessable. None of the shares of the Company’s
common stock, options, or other securities has been issued in violation any
preemptive rights of the current or past stockholders of the Company. There are
no outstanding options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into or exchangeable for, shares of any class of the capital stock
of the Company, or contracts, commitments, understandings or arrangements by
which the Company is or may be bound to issue additional shares of its capital
stock, except as contemplated hereby, and except for options issued pursuant to
the Company’s equity compensation plans.

 

(xv)
Good Standing of the Trust. The Trust
has been duly created and is validly existing in good standing as a statutory
trust under the Delaware Act with the power and authority to own property and
to conduct its business as provided in the Declaration, to enter into and
perform its obligations under the Operative Documents to which it is a party,
and to issue the Preferred Securities and the Common Securities; the Trust is
not a party to or otherwise bound by any agreement other than the Operative
Documents to which it is a party; and the Trust is, and will be, under current
law, classified for United States federal income tax purposes as a grantor
trust and not as an association taxable as a corporation.

 

(xvi)
Authorization of Common Securities. The
Common Securities have been duly authorized for issuance by the Trust pursuant
to the Declaration and, on the Closing Date, when duly issued and executed in
accordance with the Declaration and delivered by the Trust to the Company
against payment therefor in accordance with the subscription agreement
therefor, will be validly issued and fully paid and nonassessable undivided
common beneficial ownership interests in the assets of the Trust; the issuance
of the Common Securities is not subject to preemptive or other similar rights;
and on the Closing Date, all of the issued and outstanding Common Securities of
the Trust will be owned directly by the Company, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equitable right.

 

(xvii)
Authorization of Preferred Securities.
The Preferred Securities have been duly authorized for issuance by the Trust
pursuant to the Declaration and, on the Closing Date, when duly issued,
executed and authenticated in accordance with the Declaration and delivered by
the Trust against payment therefor as provided herein and will be validly
issued and fully paid and nonassessable undivided preferred beneficial
ownership interests in the assets of the Trust; the issuance of the Preferred Securities
will not be subject to preemptive or other similar rights; and the Preferred
Securities will be in the form contemplated by, and entitled to the benefits
of, the Declaration.

 

(xviii)
Authorization of this Agreement. This
Agreement has been duly authorized, executed and delivered by each of the
Offerors and assuming due authorization, execution and delivery of this
Agreement by the Purchaser, this Agreement constitutes a valid, legal and
binding agreement of each of the Offerors, enforceable against each of the
Offerors in accordance with its terms, except to the extent that enforceability
may be limited by (a) bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other similar laws now or hereafter in effect relating
to creditors’ rights generally and (b) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or
in equity) and (c) except as any contribution and indemnification
provisions thereof may be limited under applicable securities or other laws,
and that certain remedies may not be available in the case of a nonmaterial
breach (collectively, the “Enforceability Exceptions”).

 

(xix)
Authorization of Declaration. The
Declaration has been duly authorized by the Company and, on the Closing Date,
when duly executed and delivered by the Company and the Administrators, and
assuming due authorization, execution and delivery of the Declaration by the
Property Trustee and the Delaware Trustee, the Declaration will constitute a
valid, legal and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except to the extent that enforceability
may be limited by the Enforceability Exceptions.

 

(xx)
Authorization of Guarantee Agreement.
The Guarantee Agreement has been duly authorized by the Company and, on the
Closing Date, when duly executed and delivered by the Company, and assuming due
authorization, execution and delivery of the Guarantee Agreement by the
Guarantee Trustee, the Guarantee 

 

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Agreement will constitute a
valid, legal and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except to the extent that enforceability
may be limited by the Enforceability Exceptions.

 

(xxi)
Authorization of Indenture. The
Indenture has been duly authorized by the Company and, on the Closing Date,
when duly executed and delivered by the Company, and assuming due
authorization, execution and delivery of the Indenture by the Indenture
Trustee, the Indenture will constitute a valid, legal and binding agreement of
the Company, enforceable against the Company in accordance with its terms,
except to the extent that enforceability may be limited by the Enforceability
Exceptions.

 

(xxii)
Authorization of Debentures. The
Debentures have been duly authorized by the Company, and, on the Closing Date,
when duly executed by the Company and, when authenticated in the manner
provided for in the Indenture and delivered by the Company to the Trust against
payment therefor as contemplated in the subscription agreement therefor, will
constitute valid, legal and binding obligations of the Company, enforceable
against the Company in accordance with their terms, except to the extent that
enforceability may be limited by the Enforceability Exceptions; the Debentures
will be in the form contemplated by, and entitled to the benefits of, the
Indenture; the Debentures constitute indebtedness of the Company for United
States federal income tax purposes and the Company has no present intention to
exercise its option to defer payments of interest on the Debentures as provided
in the Indenture.

 

(xxiii)
Authorization of Administrators. Each of
the Administrators of the Trust is an officer or employee of the Company and
has been duly authorized by the Company to execute and deliver the Declaration.

 

(xxiv)
Authorization of Warrants, Common Stock;
Reservation of Shares. The Warrants have been duly authorized by the
Company, and, on the Closing Date, when duly executed by the Company and
delivered by the Company in accordance with the terms of the Operative
Documents, will be duly and validly issued, free and clear of all liens,
charges and encumbrances, other then restrictions on transfer provided for in the
Operative Documents, those imposed by applicable securities laws and than those
created by any Purchaser, and shall not be subject to preemptive rights of
shareholders of the Company. The Warrant Shares have been duly authorized by
the Company, and, when issued and paid for upon the exercise of Warrants in
accordance with the terms of the Warrants, will be duly and validly issued,
free and clear of all liens, charges and encumbrances, other then restrictions
on transfer provided for in the Operative Documents, those imposed by
applicable securities laws and than those created by any Purchaser, and shall
not be subject to preemptive rights of shareholders of the Company. The Company
has established a reserve from among its authorized and unissued shares of a
sufficient number of shares of common stock to issue all of the Warrant Shares
upon exercise of the then outstanding Warrants.

 

(xxv)
Not an Investment Company. Neither the
Trust nor the Company is, and immediately following consummation of the
transactions contemplated hereby and the application of the net proceeds
therefrom neither the Trust nor the Company will be, an “investment company” or
an entity “controlled” by an “investment company”, in each case within the
meaning of Section 3(a) of the Investment Company Act of 1940, as
amended (the “1940 Act”), without regard to Section 3(c) of the 1940
Act.

 

(xxvi)
Absence of Defaults and Conflicts. The
Trust is not in violation of the trust certificate of the Trust filed with the
State of Delaware (the “Trust Certificate”) or the Declaration, and neither the
Company nor any of its subsidiaries is in violation of its charter, bylaws or
code of regulations; none of the Trust, the Company or any subsidiary of the
Company is in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or other
agreement or instrument to which it is a party or by which it or any of them
may be bound or to which any of its properties or assets is subject
(collectively, “Agreements and Instruments”), except for such defaults under
Agreements and Instruments that, in the reasonable judgment of the Company, are
not expected to result in a Material Adverse Effect; and the execution,
delivery and performance of the Operative Documents by the Trust or the
Company, as the case may be, the issuance, sale and delivery of the Preferred
Securities and the Debentures, the consummation of the transactions contemplated
by the Operative Documents, and compliance by the Trust and the Company with
the terms of the Operative Documents to which they are a party have been duly
authorized by all necessary corporate action on the part of the Company and, by
all necessary action on the part of the Trust and do not and will not, whether
with or without the giving of notice or passage of time or both, violate,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or 

 

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imposition of any, security
interest, mortgage, pledge, lien, charge, encumbrance, claim or equitable right
upon any properties or assets of the Trust or the Company or any of its
subsidiaries pursuant to any of the Agreements and Instruments, nor will such
action result in any violation of the provisions of the charter, by-laws or
code of regulations of the Company or any of its subsidiaries or the
Declaration or the Trust Certificate, or violation by the Company or any of its
subsidiaries of any applicable law, statute, rule, regulation, judgment, order,
writ or decree of any government, government authority, agency (including,
without limitation, each applicable Regulatory Agency) or instrumentality or
court, domestic or foreign, having jurisdiction over the Trust or the Company
or any of its subsidiaries or their respective properties or assets
(collectively, “Governmental Entities”). As used herein, a “Repayment Event”
means any event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder’s behalf)
the right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by the Trust or the Company or any of its
subsidiaries prior to its scheduled maturity.

 

(xxvii)
Absence of Labor Dispute. No labor
dispute with the employees of the Company or any of its subsidiaries exists or,
to the knowledge of the executive officers of the Company, is imminent, which,
in the reasonable judgment of the Company, in either case, is expected to
result in a Material Adverse Effect.

 

(xxviii)
Absence of Proceedings. There is no
action, suit, proceeding, inquiry or investigation before or brought by any
Governmental Entity, now pending, or, to the knowledge of the Trust or the
Company, threatened, against or affecting the Trust or the Company or any of
its subsidiaries, which, in the reasonable judgment of the Trust or the Company
is expected to result in a Material Adverse Effect or materially and adversely
affect the consummation of the transactions contemplated by the Operative
Documents or the performance by the Trust or the Company of its obligations
hereunder or thereunder; and the aggregate of all pending legal or governmental
proceedings to which the Trust or the Company or any of its subsidiaries is a
party or of which any of their respective properties or assets is the subject,
including ordinary routine litigation incidental to the business, are not, in
the reasonable judgment of the Company or the Trust, expected to result in a
Material Adverse Effect.

 

(xxix)
Absence of Further Requirements. No
filing with, or authorization, approval, consent, license, order, registration,
qualification or decree of, any Governmental Entity, other than those that have
been made or obtained, is necessary or required for the authorization,
execution, delivery or performance by the Trust or the Company of their
respective obligations under the Operative Documents, the Debentures or the
Securities, as applicable, or the consummation by the Trust or the Company of
the transactions contemplated by the Operative Documents.

 

(xxx)
Possession of Licenses and Permits. Each
of the Trust, the Company and the subsidiaries of the Company possesses such
permits, orders, certificates, licenses, approvals, consents and other
authorizations (collectively, “Governmental Licenses”) issued by the
appropriate Governmental Entities necessary to conduct the business now
operated by it that is material to the Trust or the Company and its
subsidiaries considered as one enterprise; each of the Trust, the Company and
the subsidiaries of the Company is in compliance with the terms and conditions
of all of its Governmental Licenses, except where the failure so to comply, in
the reasonable judgment of the Company, is not expected to, singularly or in
the aggregate, have a Material Adverse Effect; all of the Governmental Licenses
are valid and in full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force and
effect, in the reasonable judgment of the Company, is not expected to have a
Material Adverse Effect; and none of the Trust, the Company or any subsidiary
of the Company has received notice of any proceeding, and to the knowledge of
the Trust, the Company or any subsidiary of the Company, there has been no
threatened proceeding, relating to the revocation, termination, suspension or
modification of any such Governmental Licenses which, singularly or in the
aggregate, in the reasonable judgment of the Company or the Trust, is expected
to result in a Material Adverse Effect.

 

(xxxi)
Title to Property. Each of the Trust,
the Company and the subsidiaries of the Company has good and marketable title
to all of its respective real and personal properties, in each case free and
clear of all liens, encumbrances and defects, except such as, in the reasonable
judgment of the Trust or the Company, singularly or in the aggregate, are not expected
to result in a Material Adverse Effect; and all of the leases and subleases
under which the Trust, the Company or any subsidiary of the Company holds
properties are in full force and effect, except when the failure of such leases
and subleases to be in full force and effect, in the reasonable judgment of the
Company, singularly or in the aggregate, is not expected to have a Material
Adverse Effect, and none of the Trust, 

 

7

 

the Company or any subsidiary
of the Company has any notice of any claim of any sort that has been asserted
by anyone adverse to the rights of the Trust, the Company or any subsidiary of
the Company under any of the leases or subleases under which the Trust, the
Company or any subsidiary of the Company holds properties, or affecting or
questioning the rights of such entity to the continued possession of the leased
or subleased premises under any such lease or sublease, except when such claim,
in the reasonable judgment of the Company, singularly or in the aggregate, is
not expected to have a Material Adverse Effect.

 

(xxxii)
No General Solicitation; No Directed Selling
Efforts. Neither the Trust or the Company nor any of their
Affiliates (as defined in Rule 501(b) under the 1933 Act) or any
person acting on its or any of their behalf has engaged or will engage, in
connection with the offer and sale of any of the Securities, in any form of
general solicitation or general advertising within the meaning of Rule 502(c) under
the 1933 Act, except that no representation or warranty is made as to the
activities of the Purchasers or any person acting for, on behalf of, or at the
behest of the Purchasers. Neither the Trust or the Company nor any of their
Affiliates or any person acting on its or any of their behalf has engaged or
will engage in any directed selling efforts within the meaning of Regulation S
under the 1933 Act (“Regulation S”) with respect to the offer and sale of the
Capital Securities, except that no representation or warranty is made as to the
activities of the Purchasers or any person acting for, on behalf of, or at the
behest of the Purchasers.

 

(xxxiii)
No Registration. Subject to compliance
by the Purchasers with the relevant provisions of Section 5 hereof, and
the accuracy of the representations and warranties of the Purchasers, it is not
necessary in connection with the offer, sale and delivery of the Securities by
the Trust and the Company to the Purchasers in the manner contemplated by this
Agreement to register any of the Securities, the Warrant Shares, the guarantee
as described in the Guarantee Agreement or the Debentures under the 1933 Act or
to qualify the Declaration, the Guarantee Agreement or the Indenture under the
Trust Indenture Act of 1939, as amended.

 

(xxxiv)  Memorandum. The
confidential private placement memorandum of the Offerors dated as of September 19,
2008 relating to the offering of the Securities (the “Memorandum”), does not
included an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.

 

(xxxv)
Compliance; Ranking. The (y) Floating
Rate Junior Subordinated Notes due 2032 issued to VCBI Capital Trust II, the capital
securities issued by VCBI Capital Trust II and the related guarantee of the
Company with respect to the securities of VCBI Capital Trust II, issued on December 19,
2002 and (z) Fixed/Floating Rate Junior Subordinated Debt Securities due
2036 issued to VCBI Capital Trust III, the capital securities issued by VCBI
Capital Trust III and the related guarantee of the Company with respect to the
securities of VCBI Capital Trust III, issued on December 20, 2005 (i) comply
with the rules, regulations and interpretations of the Board of Governors of
the Federal Reserve (the “Federal Reserve”), (ii) qualify for “Tier 1
Capital” treatment under the capital adequacy guidelines of the Federal Reserve
(subject to the limitations on the amount of restricted core capital elements
which maybe included in Tier 1 Capital under the rules of the Federal
Reserve, and (iii) will rank pari passu in right of payment with
Debentures, Preferred Securities and the related guarantee described in the
Guarantee Agreement.

 

(xxxvii)
Senior Indebtedness. Senior Indebtedness (as defined below) of the Company
shall not include (u) the Debentures, (v) the guarantee with respect
to the Debentures as described in the Guarantee Agreement, (w) the Company’s
Floating Rate Junior Subordinated Notes due 2032 issued to VCBI Capital Trust
II pursuant to that certain Indenture, dated as of December 19, 2002, by
and between the Company and The Bank of New York, (x) the related
guarantee of the Company with respect to the securities of VCBI Capital Trust
II, issued pursuant to that certain Guarantee Agreement, dated as of December 19,
2002, by and between the Company and The Bank of New York; (y) the Company’s
Fixed/Floating Rate Junior Subordinated Debt Securities due 2036 issued to VCBI
Capital Trust III pursuant to that certain Indenture, dated as of December 20,
2005, by and between the Company and Wilmington Trust Company, and (z) the
related guarantee of the Company with respect to the securities of VCBI Capital
Trust III, issued pursuant to that certain Guarantee Agreement, dated as of December 20,
2005, by and between the Company and Wilmington Trust Company. For purposes of
this Section “Senior Indebtedness” means, with respect to the Company, (i) the
principal, premium, if any, and interest in respect of (A) indebtedness of
the Company for all borrowed and purchased money and (B) indebtedness
evidenced by securities, debentures, notes, bonds or other similar instruments
issued by the Company; (ii) all capital lease obligations of the Company; (iii) all

 

8

 

obligations of the Company
issued or assumed as the deferred purchase price of property, all conditional
sale obligations of the Company and all obligations of the Company under any
title retention agreement; (iv) all obligations of the Company for the
reimbursement of any letter of credit, any banker’s acceptance, any security
purchase facility, any repurchase agreement or similar arrangement, any
interest rate swap, any other hedging arrangement, any obligation under options
or any similar credit or other transaction; (v) all obligations of the
Company associated with derivative products such as interest and foreign
exchange rate contracts, commodity contracts, and similar arrangements; (vi) all
obligations of the type referred to in clauses (i) through (v) above
of other Persons (as defined in the Indenture) for the payment of which the
Company is responsible or liable as obligor, guarantor or otherwise including,
without limitation, similar obligations arising from off-balance sheet
guarantees and direct credit substitutes; and (vii) all obligations of the
type referred to in clauses (i) through (vi) above of other Persons
secured by any lien on any property or asset of the Company (whether or not
such obligation is assumed by the Company), whether incurred on or prior to the
date of this Indenture or thereafter incurred. Notwithstanding the foregoing, “Senior
Indebtedness” shall not include (1) any Junior Indebtedness (as defined in
the Indenture), (2) the Debentures and guarantees in respect of such
Debentures, (3) trade accounts payable of the Company arising in the
ordinary course of business (such trade accounts payable being pari passu in right of payment to the Debentures), or (4) obligations
with respect to which (a) in the instrument creating or evidencing the
same or pursuant to which the same is outstanding, it is provided that such
obligations are pari passu, junior or otherwise
not superior in right of payment to the Debentures and (b) the Company,
prior to the issuance thereof, has notified (and, if then required under the
applicable guidelines of the regulating entity, has received approval from) the
Federal Reserve.

 

(xxxviii)  To the best knowledge of the Company the
Company: (a) is not in violation of any statute, rule, regulations,
decision or order of any governmental agency or body, or any court, relating to
the use, disposal or release of hazardous or toxic substances, or relating to
the protection or restoration of the environment, or human exposure to
hazardous or toxic substances (“Environmental Laws”); (b) does not own or
operate any real property contaminated with any substance in violation of the
Environmental Laws; (c) is not liable for any off-site disposal or
contamination pursuant to Environmental Laws; and (d) is not subject to
any claim relating to any Environmental Laws; which violation, contamination,
liability or claim has had, or could reasonably be expected to have,
individually or in the aggregate; and there is not pending, or to the knowledge
of the Company, threatened investigation that may lead to such a claim.

 

(xxxix)
The Company is insured by insurers of recognized financial responsibility
against such losses and risks and in such amounts as the Company reasonably
believes is prudent and customary in light of the businesses conducted by the
Company, and the location of its operations. The Company does not have any
knowledge that it will be unable to renew its existing insurance coverage as
and when such coverage expires from comparable insurers, or that such renewals
will require a significant increase in cost.

 

(xxxx)  The Company’s common stock is registered
pursuant to Section 12(b) of the 1934 Act. The Company has not taken
any action to terminate such registration, and has not received any notice that
the Commission is contemplating the termination of such registration. Since January 1,
2007, the Company has not received any written notice from any national
securities exchange or interdealer quotation system on which the Company’s
common stock is or was listed for trading or quote, to the effect that the
Company was not in compliance with the listing or maintenance requirements of
such market. The Company has no knowledge of any circumstance that would cause the
Company to be deemed to not be in compliance with the listing or maintenance
standards of The Nasdaq Stock Market (“Nasdaq”).

 

(xxxxi)  The Company has no arrangement, agreement or
understanding with any Purchaser with respect to the transactions contemplated
hereby and by the Operative Documents, other than as specified herein or in the
Operative Documents.

 

(b) Any
certificate signed by any Trustee of the Trust or any duly authorized officer
of the Company or any of its subsidiaries and delivered to the Purchaser or to
counsel for the Purchaser shall be deemed a representation and warranty by the
Trust or the Company, as the case may be, to the Purchaser as to the matters
covered thereby.

 

SECTION 3.
Payment of Expenses. Whether or not this
Agreement is terminated or the sale of the Preferred Securities is consummated,
the Company, as borrower under the Debentures, will pay all expenses incident
to the performance of its obligations under this Agreement, including (i) the
preparation, issuance and 

 

9

 

delivery of the certificates
for the Securities and the Debentures, (ii) the fees and disbursements of
the Company’s counsel, accountants and other advisors and (iii) the fees
and disbursements of any registrar for the Preferred Securities or the
Warrants. Notwithstanding the foregoing, the fees and disbursements of any
trustee appointed under any of the Operative Documents and its counsel shall be
paid as specified in the fee agreement between the Company and Wilmington Trust
Company.

 

SECTION 4.
A. Conditions of Purchaser’s Obligations.
The obligations of the Purchaser on the Closing Date are subject to the
accuracy of the representations and warranties of the Offerors contained in Section 2
hereof or in certificates of any Administrator of the Trust or any officer of
the Company or any of its subsidiaries delivered pursuant to the provisions
hereof, to the performance by the Offerors of their obligations hereunder, and
to the following further conditions:

 

(a) Opinion of Counsel for the Offerors. On
the Closing Date, the Purchasers shall have received the favorable opinion,
dated as of the Closing Date, of Kennedy & Baris, L.L.P., special
counsel for the Offerors, in substantially the form set out in Annex A hereto. Such
counsel may state that, insofar as such opinion involves factual matters, they
have relied, to the extent they deem proper, upon certificates of
Administrators of the Trust, officers of the Company or any of its subsidiaries
and public officials.

 

(b) Opinion of Special Delaware Counsel for the Trust.
On the Closing Date, the Purchasers shall have received the favorable opinion,
dated as of the Closing Date, of Stevens & Lee, P.C., special Delaware
counsel for the Trust, in substantially the form set out in Annex B hereto.

 

(c) Opinion of Special Tax Counsel for the Offerors.
On or prior to the Closing Date, the Purchasers shall have received an opinion,
dated as of the Closing Date, of Kevin P. Kennedy, Esquire, special tax counsel
for the Offerors, that (i) the Trust will be classified for United States
federal income tax purposes as a grantor trust and not as an association
taxable as a corporation and (ii) the Debentures will constitute
indebtedness of the Company for United States federal income tax purposes, in
substantially the form set out in Annex C hereto. Such opinion may be
conditioned on, among other things, the initial and continuing accuracy of the
facts, financial and other information, covenants and representations set forth
in certificates of officers of the Company and other documents deemed necessary
for such opinion.

 

(d) Opinion of Counsel to the Guarantee Trustee, the
Property Trustee, the Delaware Trustee and the Indenture Trustee. On
the Closing Date, the Purchasers shall have received the favorable opinion,
dated as of the Closing Date, of Stevens & Lee, P.C., counsel for the
Guarantee Trustee, the Property Trustee, the Delaware Trustee and the Indenture
Trustee, in substantially the form set out in Annex D hereto, in form and
substance reasonably satisfactory to counsel for the Purchaser.

 

(e) Representations and Warranties.
The representations and warranties of the Offerors contained in Section 2
shall be true and correct in all material respects as of the Closing Date as of
the date of this Agreement and as of the Closing (other than those limited to a
specified date, which shall speak only as to such date), and the Purchasers
shall have received a certificate of the Offerors to that effect.

 

(f) Performance. The Offerors shall have performed and
complied with all covenants, agreements, obligations and conditions contained
in this Agreement that are required to be performed or complied with by them on
or before the Closing Date, and the Purchasers shall have received a certificate
of the Offerors to that effect.

 

(g) No Adverse Change. At the Closing Date, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the 1934 Act Reports, any Material Adverse Effect, and
the Purchasers shall have received a certificate of the Offerors to that
effect.

 

(h) 
No Injunction. No statute, rule,
regulation, executive order, decree, ruling or injunction shall have been
enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction that prohibits the consummation of the
transactions contemplated hereby or by the Operative Documents.

 

(i) No Suspension. The Company’s common stock shall not have
been suspended from trading or listing, or delisted from, Nasdaq, by the
Commission or Nasdaq, nor shall such suspension or delisting have been
threatened 

 

10

 

(i) in writing by the
Commission or Nasdaq; or (ii) as a result of the failure of the Company to
meet, as of the Closing Date, the minimum quantitative maintenance requirements
of Nasdaq.

 

(j) Termination of Agreement. If any condition
specified in this Section shall not have been fulfilled when and as
required to be fulfilled, this Agreement may be terminated by the Purchaser as
to its obligations hereunder by notice to the Offerors at any time on or prior
to the Closing Date. If the sale of the Preferred Securities provided for
herein is not consummated because any condition set forth in Section 4.A(a),
(b), (c), (d), (e), (f), (g), (h) or (i) is not satisfied, or because
of any refusal, inability or failure on the part of the Offerors to perform any
agreement herein or comply with any provision hereof, the Company will
reimburse the Purchaser upon demand for all documented out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been
incurred by the Purchaser in connection with the proposed sale.

 

B. Conditions
to Offeror’s Obligations. The obligations of the Offerors on the
Closing Date are subject to the accuracy of the representations and warranties
of the Purchasers contained in Section 5 hereof or in certificates of any
Purchaser delivered pursuant to the provisions hereof, to the performance by
the Purchasers of their obligations hereunder (including the obligation to pay
the purchase price of the Preferred Securities), and to the following further
conditions:

 

(a) Representations and Warranties.
The representations and warranties of the Purchasers contained in Section 5
shall be true and correct in all material respects as of the date of this
Agreement and as of the Closing Date (other than those limited to a specified
date, which shall speak only as to such date), and the Offerors shall have
received a certificate of the Purchasers to that effect.

 

(b) Performance. Each Purchaser shall have performed and
complied with all covenants, agreements, obligations and conditions contained
in this Agreement that are required to be performed or complied with by such Purchaser
on or before the Closing Date, and the Offerors shall have received a
certificate of the Purchasers to that effect.

 

(c) 
No Injunction. No statute, rule,
regulation, executive order, decree, ruling or injunction shall have been
enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction that prohibits the consummation of the
transactions contemplated hereby or by the Operative Documents.

 

SECTION 5. Representations of the Purchasers. Each Purchaser severally,
and not jointly, represents and warrants that:

 

(a) 
He/she (if a natural person) is a citizen of the United States and is at least
21 years of age.

 

(b) 
The residence of such Purchaser (if a natural person, or if a partnership,
corporation, limited liability company or other entity, then the office or
offices of the Purchaser in which its principal place of business is conducted
identified as the address of the Purchaser set forth on the signature page hereof)
set forth below in the signature block is the true and correct principal
residence (or principal office) of the undersigned and he/she has no present
intention of becoming a resident or domiciliary of any other state, county, or
jurisdiction.

 

(c) 
Such Purchaser is an accredited investor within the meaning of Rule 501(a) of
the 1933 Act. On the signature page hereof, Purchaser has initialed the
categories of investor under Rule 501 which accurately and truthfully
describes the basis for Purchaser’s status as an “accredited investor.”

 

(d) 
Such Purchaser has received and carefully read, and is familiar with, the
Memorandum (including the financial information regarding the Company included
therein and in the periodic reports under the 1934 Act referred to therein) and
has relied solely on the information contained in the Memorandum and other
written information requested from and provided by the Company. Such Purchaser
has been provided with sufficient opportunity to make inquiries of, and receive
documents or other information from, the Company with respect to the operations
and financial performance of the Company. Such Purchaser has received full and
adequate responses to such inquiries and requests.

 

11

 

(e) 
Such Purchaser understands and acknowledges that the future operating results
or financial performance of the Company are impossible to predict, and
acknowledges and agrees that no representation of any kind whatsoever has been
made by the Company or any of its affiliates with respect to the future
operating results or financial performance of the Company, or the value of the
Securities, and that any such representation with respect to such matters
(including any financial or statistical projections or pro forma financial
statements for any future period), if made or provided, has not been relied
upon by the undersigned in making his or her investment in the Securities.

 

(f) 
The undersigned has carefully considered, and to the extent such Purchaser
believes such discussions are necessary, discussed with such Purchaser’s
professional legal, tax, accounting and financial advisors the suitability of
an investment in the Securities. Taking into account such Purchaser’s
particular financial situation, the Purchaser has determined that the Securities
being purchased hereunder constitute a suitable investment for such Purchaser.

 

(g) 
The Securities which such Purchaser is purchasing hereunder will be acquired by
such Purchaser for investment only, for such Purchaser’s own account and not
for the account of others, and not with a view to resale, distribution, or
transfer of the same. The Securities are not being purchased for subdivision or
fractionalization thereof; and such Purchaser has no present intention, and no
contract, undertaking, agreement, or arrangement with any person or entity, to
sell, pledge, hypothecate or otherwise transfer (with or without consideration)
to any such person or entity any Securities which such Purchaser is hereby
acquiring, and such Purchaser has no present plans or intention to enter into
any such contract, undertaking, agreement, or arrangement, except as disclosed
to the Offerors in writing and reflected on the signature page hereof.

 

(h) 
The present financial condition of such Purchaser is such that such Purchaser
is under no present or contemplated future need to dispose of any portion of
the Securities for to satisfy any existing or contemplated undertaking, need or
indebtedness. Such Purchaser’s overall commitment to investments which are not
readily marketable is not disproportionate to such Purchaser’s net worth. After
investing in the Preferred Securities such Purchaser will have adequate
measures of providing for all current income needs and contingencies, without
regard to earnings, income or distributions on the Preferred Securities, or any
increase in value of, or distributions on, the Warrants or Common Stock.

 

(i) 
The information which the undersigned has furnished, herewith furnishes or
shall furnish to the Company with respect to the financial condition,
sophistication and/or accredited investor status, including but not limited to
the information contained in this Agreement, is accurate and complete in all
material respects.

 

(j) 
Such Purchaser has full power and authority to enter into the Agreement. The
Agreement, when executed and delivered by such Purchaser, will constitute a
valid and legally binding obligation of such Purchaser, enforceable in
accordance with its terms, except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, and any other
laws of general application affecting enforcement of creditors’ rights
generally, and as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies.

 

(k) 
Neither the execution, delivery and performance of this Agreement by the
Purchaser, nor the consummation of the transactions contemplated hereby, nor
compliance by the Purchaser with any of the provisions hereof or thereof, will (i) violate,
conflict with, or result in a breach of any provisions of, or constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) under any agreement to which the Purchaser is a party;
violate any judgment, ruling, order, writ, injunction, decree, statute, rule or
regulation applicable to the Purchaser.

 

(l) Such
Purchaser, or representatives thereof, have conducted such examination of the
Company’s public filings and books and records as such Purchaser shall deem
appropriate. The Purchaser has had an opportunity to discuss the Company’s
business, management, financial affairs and the terms and conditions of the
Offering of the Securities with the Company’s management.

 

12

 

SECTION 6.
Offers and Sales of the Preferred Securities.

 

(a) Offer and Sale Procedures. The Purchasers
and the Offerors hereby establish and agree to observe the following provisions
with respect to the offer, issue, sale and transfer of the Securities:

 

(ii) Offers and Sales by the Purchasers. The Purchasers have not,
in their respective capacities as a Purchaser, made any offer or sale of any
Securities. Offers and resales of the Securities after the Closing Date will be
made by a Purchaser only in a transaction not requiring registration under the
1933 Act.

 

(iii) No General Solicitation. No general solicitation or general
advertising (within the meaning of Rule 502(c) under the 1933 Act)
has been or will be used in connection with the offer and sale of the Securities.

 

(iv) Purchaser Notification. Purchaser acknowledges and agrees
that the Securities (A) have not been and will not be registered under the
1933 Act, (B) are being sold to them without registration under the 1933
Act in accordance with an exemption from, or in a transaction not subject to,
the registration requirements of the 1933 Act and (C) may not be offered,
sold or otherwise transferred except in accordance with the legend set forth in
Annex E hereto. Notwithstanding anything contained herein, the Securities may
be pledged or hypothecated by any investor in connection with a bona fide loan
obtained for the purpose of funding the initial purchase of the Securities from
the Company, provided that the Company is advised of such pledge or hypothecation
and the lender provides the acknowledgement in the form attached as Annex F. Any
such investor agrees to provide copies of any such loan and pledge agreements
to the Company upon request.

 

The
Company acknowledges that a Purchaser may from time to time pledge or
hypothecate of some or all of such Purchaser’s Securities in connection with a
bona fide borrowing arrangement. The Company agrees that it shall not be
required to approve or consent to any such pledge or hypothecation, and that it
shall not require any opinion of counsel as a condition to such pledge or
hypothecation, provided that a legal opinion may be required in connection with
the subsequent transfer of such Securities or foreclosure upon such pledge. Purchasers
agree to advise the Company of any such pledge or hypothecation and to cause
the lender to provide the acknowledgement in the form of Annex F. Each
Purchaser acknowledges and agrees that the Company shall not be responsible for
any pledges relating to, or any hypothecation of, any Securities, or for any
agreement, understanding or arrangement between such Purchaser and its pledgee
or secured party. Each Purchaser agrees that except as provided in Section 6(b)(v),
any Securities subject to a pledge or hypothecation arrangement shall continue
to bear the legend set forth in Annex F and to be subject to the restrictions
on transfer provided for by this Agreement.

 

The
Company acknowledges that a Purchaser may from time to time seek to transfer
Securities to an affiliated entity wholly owned, directly or indirectly, by the
Purchaser or members of such Purchaser’s immediate family, or as to which the
Purchaser or members of such Purchaser’s immediate family are the
beneficiaries, for estate planning purposes. The Company acknowledges and agrees
that such a transfer does not ordinarily involve a transaction requiring
registration under the securities laws, and agrees to use reasonable efforts to
assist Purchasers in obtaining any required legal opinion to effect such a
transfer. With respect to any Warrants which a Purchaser is entitled to be
issued hereunder which are issued to the owner of such Purchaser (the “Owner”)
in order to avoid the necessity of such Purchaser obtaining prior to Closing
any required approvals under the Change in Bank Control Act, the Bank Holding
Company Act of 1956, or comparable provisions of state law, the Company agrees
that it shall not require an opinion of counsel to be provided hereunder for
the transfer of such Warrants by the Owner to such Purchaser following receipt
of any and all required regulatory approvals. Not in limitation of the
foregoing, upon receipt of all regulatory approvals required to enable Global
Bankshares LLC (“Global”) and any company controlling Global to hold the
Warrants or the Warrants Shares in compliance with applicable law, then Arthur
L. Walters (“Walters”), shall be permitted to transfer to Global, without an
opinion of counsel, Warrants issued in his name in respect of Global’s purchase
of Preferred Securities hereunder, provided that Global is wholly owned,
directly or indirectly, by Walters or members of his immediate family, or by
any entity as to which Walters or members of his immediate family are the
beneficiaries.

 

(b) Covenants of the Offerors. Each of the
Offerors, jointly and severally, covenant with the Purchasers as follows:

 

(i) Due Diligence. In connection with the purchase of the
Securities, the Offerors agree that, while each Purchaser is the holder of
Securities, each Purchaser shall have the right to make reasonable inquiries
into the business of the Trust, the Company and the subsidiaries of the
Company. The Offerors also agree to provide answers to the Purchaser concerning
the Trust, the Company and the subsidiaries of the Company (to the extent that
such 

 

13

 

information is available or
can be acquired and made available without unreasonable effort or expense and
to the extent the provision thereof is not prohibited by applicable law) and
the terms and conditions of the offering of the Securities and the Debentures.

 

(ii) Integration. The Offerors agree that they will not, and will
cause their Affiliates not to, make any offer or sale of securities of the
Offerors of any class if, as a result of the doctrine of “integration” referred
to in Rule 502 under the 1933 Act, such offer or sale would render invalid
the exemption from the registration requirements of the 1933 Act provided by Section 4(2) thereof
or by Rule 506 or otherwise.

 

(iii) Disclosure in Subsequent Issuances. While the Preferred
Securities are outstanding, the Company will cause the indenture, declaration
and guarantee, as applicable, of every subsequent issuance of Preferred
Securities and other similar securities to expressly state therein that the
Debentures, the Preferred Securities and the guarantee with respect to the
Preferred Securities will rank pari passu in
right of payment with each such subsequent issuance.

 

(iv) Warrant Share Reserve. So long as any Warrants remain
outstanding the Company shall maintain a reserve from among its authorized and
unissued shares of a sufficient number of shares of common stock to issue all
of the Warrant Shares upon exercise of the then outstanding Warrants.

 

(v) Legend Removal. The Offerors agree that they shall cause the
legends required by this Agreement and the Operative Documents to be removed
from certificates evidencing the Securities (i) following a sale of such
Securities pursuant to an effective registration statement, so long as the
purchaser of the Securities is not an Affiliate of the Company, (ii) following
a sale of such Securities pursuant to Rule 144 so long as the purchaser of
the Securities is not an Affiliate of the Company, or (iii) if such legend
is not required under applicable requirements of the Securities Act (including
judicial interpretations and pronouncements issued by the Staff of the
Commission) provided in the case of (iii), however, that the beneficial owner
of the Shares is not an Affiliate of the Company. Following such time as restrictive
legends are not required to be placed on certificates representing Securities
under this Section 6.1(b)(v), the Company or Trust, as the case may be
will, not later than three trading says following the delivery by a Purchaser
to the Company or Trust, as the case may be of a certificate representing such
Securities containing a restrictive legend (such third trading day, the “Legend
Removal Date”), deliver or cause to be delivered to such Purchaser a
certificate representing such Securities that is free from all restrictive and
other legends.

 

(vi) Buy- In. If the Company shall fail to deliver unlegended
certificates for Warrant Shares by the Legend Removal Date, and if on or after
the trading day immediately following the Legend Removal Date, the Purchaser
purchases (in a market transaction or otherwise) shares of common stock to
deliver in satisfaction of a sale by Purchaser of Warrant Shares made in
anticipation of receiving such unlegended Warrant Shares (a “Buy-In”) then the
Company shall, within three trading days after the Purchaser’s request, deliver
such unlegended Warrant Shares and pay such Purchase cash in an amount equal to
the excess, if any, of the Buy-In price over the product of the number of
shares of common stock subject to such Buy-In transaction multiplied by the
closing bid on the Legend Removal Date.

 

(viii) Information and Reporting. The Company hereby covenants to
use its reasonable efforts to timely file all 1934 Act reports required to be
filed after the date hereof or to obtain extensions in respect thereof and file
within the applicable grace period, for so long as any Purchaser owns the
Securities. If the Company is not required to file 1934 Act reports during any
period when any Purchaser owns any Securities, the Company shall use reasonable
efforts to prepare and make publicly available in accordance with Rule 144(c) such
information as may be required to enable Purchasers to sell Securities pursuant
to Rule 144.

 

(ix) Form D; Blue Sky. The Company agrees to provide
Purchasers with a copy of any Form D filed with the Commission with
respect to the sale of the Securities promptly following such filing, and to
take such action as may reasonably be necessary to qualify or obtain an
exemption from qualification of the sale of the Securities to the Purchasers
under applicable state securities laws.

 

(x) Indemnification. The Company agrees that it will indemnify
and hold the Purchasers harmless from any and all losses, liabilities,
obligations, claims, contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable attorneys’
fees and costs of investigation (“Losses”) that any such Purchaser may suffer
or incur as a result of or relating to any misrepresentation, breach or inaccuracy
of any 

 

14

 

representation, warranty,
covenant or agreement of the Company or Trust in this Agreement, provided
however, that no such indemnification shall be required with respect to any
misrepresentation, breach or inaccuracy of which such Purchaser had actual
knowledge (including knowledge which such Purchaser should have as a result of
disclosure to such Purchaser in the course of such Purchaser’s duties as a
director or officer of the Company).

 

Promptly
after the receipt by any Purchaser entitled to indemnification hereunder of any
notice of any demand, claim or circumstances which would or might give rise to
any claim or the commencement of any action, proceeding or investigation in
respect of which indemnification may be sought pursuant to this Section, such
person shall promptly notify the Company in writing and the Company shall
assume the defense thereof, including the employment of counsel reasonably
satisfactory to such indemnified person, and shall assume the payment of all
fees and expenses thereof, provided, however, that the failure to so notify the
Company shall not relieve such the Company from any liability hereunder to the
extent it is not materially prejudiced as a result thereof. In any such
proceeding, the indemnified party shall have the right to obtain its own
counsel, but the fees and expenses of such counsel shall be at such person’s
own expense, unless the Company and such indemnified party shall have mutually
agreed to the retention of such counsel or in the reasonable judgment of
counsel to the indemnified party, representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them. Except as expressly provided herein, in no event shall the
Company be liable for fees and expenses of more than one counsel for all
indemnified parties in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the same general
allegations or circumstances. The Company shall not, without the prior written
consent of the indemnified parties, which consent shall not be unreasonably
conditioned, delayed or withheld, settle or compromise or consent to the entry
of any judgment with respect to any pending or threatened proceeding or claim
in respect of which indemnification or contribution could be sought under this Section (whether
or not the indemnified party is an actual or potential party thereto), unless
such settlement, compromise or consent includes an unconditional release of
such indemnified party from all liability arising out of such proceeding or
claim. The Company shall not be liable for any settlement of any proceeding or
claim effected without its written consent, which shall not be unreasonably
withheld, conditioned or delayed.

 

SECTION 7.
Representations, Warranties and Agreements to
Survive Delivery.

 

Other
than representation, warranties and agreements of the Offerors and the
purchasers that by their terms relate to or are required to be performed after
the delivery of the Securities, no representations, warranties and agreements
contained in this Agreement or in certificates of officers of the Company or
Trustees of the Trust submitted pursuant hereto shall not survive delivery of
the Preferred Securities by the Trust and the Warrants by the Company.

 

SECTION 8.
Termination of Agreement.

 

(a) Termination; General. Any Purchaser may
terminate this Agreement with respect to such Purchaser, by notice to the
Offerors, at any time on or prior to the Closing Date if, since the time of
execution of this Agreement (i) there has occurred any Material Adverse
Effect, or (ii) there has occurred any material adverse change in the
financial markets in the United States, any outbreak of hostilities or
escalation thereof or any other calamity or crisis, or any change or
development involving political, financial or economic conditions, or (iii) trading
in any securities of the Company has been suspended or limited by the
Commission or any national stock exchange or market on or in which such
securities are traded or quoted, or if trading generally on the American Stock
Exchange, the New York Stock Exchange or the Nasdaq Stock Market has been
suspended or limited, or minimum or maximum prices for trading have been fixed,
or maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the Financial Institution Regulatory
Authority or any other governmental authority, or (iv) a banking
moratorium has been declared by United States federal, Delaware, Virginia or
New York authorities.

 

(b) Liabilities. If this Agreement is
terminated pursuant to this Section, such termination shall be without
liability of any party to any other party except as provided in Section 3
or Section 4.A(f) hereof.

 

SECTION 9.
Notices. All notices and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if mailed or transmitted by any standard form of telecommunication.
Notices to the 

 

15

 

Purchasers shall be directed
to the addresses set forth on the signature page hereof; and notices to
the Offerors shall be directed to Virginia Commerce Bancorp, Inc., 14201
Sullyfield Circle, Suite 500, Chantilly, Virginia 20151, Attention:
William K. Beauchesne, with a copy to Kennedy & Baris, LLP, Suite P-15,
4701 Sangamore Road, Bethesda, Maryland 20816, Attention: Noel M. Gruber.

 

SECTION 10.
Parties. This Agreement shall inure to the
benefit of and be binding upon each of the Purchaser and the Offerors and their
respective successors, assigns, heirs, beneficiaries, legatees and personal
representatives. Nothing expressed or mentioned in this Agreement is intended
or shall be construed to give any person, firm or corporation, other than the
Purchaser and the Offerors, and their respective successors, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the Purchaser
and the Offerors and their respective successors, and said controlling persons
and other persons and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation.

 

SECTION 11.
GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF
VIRGINIA, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OF SAID STATE.

 

EACH OF THE TRUST AND THE
COMPANY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE FEDERAL
AND VIRGINIA STATE COURTS LOCATED IN THE CITY OF ALEXANDRIA AND/OR THE COUNTIES
OF ARLINGTON OR FAIRFAX IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING
RELATED TO THIS AGREEMENT OR ANY OF THE MATTERS CONTEMPLATED HEREBY,
IRREVOCABLY WAIVES ANY DEFENSE OF LACK OF PERSONAL JURISDICTION AND IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING MAY BE
HEARD AND DETERMINED IN ANY SUCH COURT. EACH OF THE TRUST AND THE COMPANY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER
APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 

SECTION 12.
Disclosure of Tax Treatment and Tax Structure.
Notwithstanding anything herein to the contrary, any party to this Agreement
(and each employee, representative or other agent of any party to this
Agreement) may disclose to any and all persons, without limitation of any kind,
the tax treatment and tax structure of the offering and all materials of any
kind (including opinions or other tax analyses) that are provided to it
relating to such tax treatment and tax structure. However, such information
relating to the tax treatment or tax structure is required to be kept
confidential to the extent necessary to comply with any applicable federal or
state securities laws. For this purpose, “tax structure” means any facts
relevant to the federal income tax treatment of the offering contemplated by
this Agreement but does not include information relating to the identity of the
Offerors.

 

SECTION 13.
Effect of Headings. The Section headings
herein are for convenience only and shall not affect the construction hereof.

 

SECTION 14.
Counterparts. This Agreement may be
executed in any number of counterparts, which together shall constitute one and
the same instrument.

 

SECTION 15.
Purchaser Representatives. Each
Purchaser hereby designates and appoints Peter A. Converse, William K.
Beauchesne and Robert H. L’Hommedieu, or any of them, such Purchaser’s
representative and attorney in fact to execute and deliver any and all
acknowledgements, receipts, confirmations, certificates or other documents
required to be delivered by Purchasers in connection with the Closing of the
sale of Securities hereunder and under the Operative Documents.

 

[Remainder of page intentionally blank – Signature page follows]

 

16

 

IN
WITNESS WHEREOF, the undersigned have set their respective hands, duly
authorized, as of the date and year first set forth above.

 

	
  VIRGINIA COMMERCE BANCORP,
  INC.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  
	
   

  
	
  VCBI CAPITAL TRUST IV

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Administrator

  
					

 

PURCHASERS

 

The undersigned Purchaser represents and warrants that
each of the categories initialed below
accurately reflects the status of the undersigned, and further represents and
warrants that except as marked to the contrary below (a) the undersigned
is an accredited investor as that term is defined in the regulations of the
Securities and Exchange Commission, and (b) the undersigned meets any
additional suitability and/or financial standards or requirements which may be
imposed in connection with the sale of the Securities by the law or regulations
of the jurisdiction in which he/she/it resides. (Initial
those categories which apply)

 

	
  (1)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  he/she is a director or executive officer of the Company.

  
	
   

  	
   

  	
   

  	
   

  
	
  (2)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  he/she is a natural person whose net worth at the time of purchase of 

  
	
   

  	
   

  	
   

  	
  the Notes, or joint net worth with the
  undersigned investor’s spouse, exceeds $1,000,000.

  
	
   

  	
   

  	
   

  	
   

  
	
  (3)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  he/she is a natural person who had income in excess of $200,000 in 

  
	
   

  	
   

  	
   

  	
  each of the two most recent years, or who had
  joint income with the undersigned investor’s spouse in excess of $300,000 in
  each of those years, and who reasonably expects to reach the same income
  level in the current year. For the purpose of this category, “income” is the
  undersigned’s adjusted gross income, as reported on his/her federal income
  tax return, increased by the following amounts: (i) the amount of any tax-exempt
  interest income received under Section 103 of the Code; (ii) the
  amount of losses claimed as a limited partner in a limited partnership as
  reported on Schedule E of Form 1040; (iii) any deduction claimed
  for depletions under Section 611 of the Code; and (iv) amounts
  contributed to an IRA or retirement plan.

  
	
   

  	
   

  	
   

  	
   

  
	
  (4)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  it is a trust with total assets in excess of $5,000,000, not formed for 

  
	
   

  	
   

  	
   

  	
  the specific purpose of acquiring the
  securities offered, whose purchase is directed by a sophisticated person who
  has such knowledge and experience in financial and business matters that
  he/she is capable of evaluating the merits and risks of an investment in the
  common stock of the Company.

  
	
   

  	
   

  	
   

  	
   

  
	
  (5)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  it is a corporation, a Massachusetts or similar business trust, 

  
	
   

  	
   

  	
   

  	
  partnership, or an organization exempt under
  Section 501(c)(3) of the Internal Revenue Code, which has not been
  formed for the specific purpose of acquiring the securities offered, and
  which has total assets in excess of $5,000,000.

  

 

17

 

	
  (6)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  it is a partnership, corporation or other entity all of whose equity 

  
	
   

  	
   

  	
   

  	
  owners satisfy one or more of the conditions
  set forth in (1) though (5), and a certification as to such status by
  each such equity owner is attached hereto.

  
	
   

  	
   

  	
   

  	
   

  
	
  (7)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  he/she/it is an accredited investor not described above, based on the 

  
	
   

  	
   

  	
   

  	
  following information:

  
	
   

  	
   

  	
   

  	
   

  
	
  (8)

  	
   

  	
   

  	
  The undersigned investor hereby represents that
  he/she/it is not an accredited investor.

  

 

 

	
  Number of Preferred
  Securities Purchased:

  	
   

  	
   

  	
  Warrants:

  	
   

  
	
   

  	
   

  
	
  Aggregate Purchase Price:

  	
   

  	
   

  	
   

  
							

 

	
  Purchaser Sign Here:

  	
   

  	
   

  
	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Age:

  
	
   

  	
   

  
	
  Residence Address:

  	
   

  
	
   

  	
   

  
	
  Business Address:

  	
   

  
	
   

  	
   

  
	
  Telephone No.: Office:

  	
   

  	
   

  	
  Residence:

  	
   

  
	
   

  	
   

  
	
  Email Address:

  	
   

  	
   

  	
  Social Security No.:

  	
   

  
													

 

Check to indicate to which address mailings should be
directed:               o   Business         o   Residence

 

The name or names to be on the Securities certificate or
certificates and the address and Social Security Number/Tax Identification
Number of such person(s) or entity(s) is as follows:

 

	
  Name:

  	
   

  	
   

  
	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  
	
  SSN/TIN:

  	
   

  	
   

  
						

 

The contact information for
any lender to whom any of the Securities are to be pledged:

 

	
  Name:

  	
   

  	
   

  
	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  
	
  Telephone No:

  	
   

  	
   

  
	
   

  
	
  Contact Person:

  	
   

  	
   

  
							

 

Should payments of
Distributions and redemption payments in respect of the Preferred Securities be
delivered to the lender identified above? (mark one)   o Yes o No

 

18

 

ANNEX A

 

Pursuant to Section 5.A(a) of
the Purchase Agreement, special counsel for the Offerors shall deliver an
opinion in substantially the following form:

 

1.             The Company is incorporated and is validly
existing as a corporation in good standing under the laws of the Commonwealth
of Virginia.

 

2.             The Company has corporate power and authority
to (i) execute and deliver, and to perform its obligations under, the
Operative Documents to which it is a party and (ii) issue and perform its
obligations under the Debentures.

 

3.             The Company is registered as a bank holding
company under the Bank Holding Company Act of 1956, as amended.

 

4.             (i) Each Significant Subsidiary is
validly existing and in good standing under the laws of the jurisdiction of its
organization; and (ii) to the best of our knowledge, all of the issued and
outstanding shares of capital stock of each Significant Subsidiary are owned of
record by the Company, directly or through other subsidiaries.

 

5.             The deposit accounts of each of the bank
subsidiary of the Company are insured by the Federal Deposit Insurance
Corporation up to the maximum amount allowable under applicable law and, to the
best of our knowledge, no proceeding for the termination of such insurance is
pending or threatened.

 

6.             Each of the Company and its subsidiaries (i) is
duly qualified to do business as a foreign corporation and is in good standing
under the laws of each jurisdiction which requires such qualification wherein
it owns or leases properties or conducts business and (ii) holds all
approvals, authorizations, orders, licenses, certificates and permits from
governmental authorities necessary for the conduct of its business, except
where the failure to be so qualified or to hold such approvals, authorizations,
orders, licenses, certificates and/or permits would not, singularly or in the
aggregate, have a Material Adverse Effect.

 

7.             No consent, approval, authorization or order of
or filing, registration or qualification with any Governmental Entity is
required under any law or regulation of the United States or the states in
which the Company and any bank subsidiary of the Company is organized in
connection with the authorization, execution, delivery and performance by the
Company of the Operative Documents or the Securities and the consummation of
the transactions contemplated thereby except as have already been obtained or
made.

 

8.             The Purchase Agreement has been duly authorized,
executed and delivered by the Company and, assuming due authorization,
execution and delivery thereof by the Purchaser, constitutes a valid and
binding instrument of the Company, enforceable against the Company in
accordance with its terms, except as rights to indemnity and contribution
thereunder may be limited under applicable law or public policy, and subject to
the qualifications that (i) enforcement thereof may be limited by bankruptcy,
insolvency, receivership, reorganization, liquidation, voidable preference,
moratorium or other laws (including the laws of fraudulent conveyance and
transfer) or judicial decisions affecting the enforcement of creditors’ rights
generally or the reorganization of financial institutions; (ii) the
enforceability of the obligations of the Company thereunder is subject to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and to the effect of certain
laws and judicial decisions upon the availability and enforceability of certain
remedies, including the remedies of specific performance and self-help; and (iii) the
indemnification and contribution provisions thereof may be limited under
applicable laws and certain remedies may not be available in the case of a
non-material breach.

 

9.             The Declaration has been duly authorized,
executed and delivered by the Company and the Administrators.

 

10.           Each of the Guarantee Agreement, the Indenture and the Warrants has
been duly authorized, executed, and delivered by the Company and, assuming due
authorization, execution and delivery by the Guarantee 

 

19

 

Trustee and the Indenture
Trustee of the Guarantee Agreement and Indenture, respectively, constitutes a
valid and binding instrument of the Company, enforceable against the Company in
accordance with its terms, except as rights to indemnity and contribution
thereunder may be limited under applicable law or public policy, and subject to
the qualifications that (i) enforcement thereof may be limited by
bankruptcy, insolvency, receivership, reorganization, liquidation, voidable
preference, moratorium or other laws (including the laws of fraudulent
conveyance and transfer) or judicial decisions affecting the enforcement of creditors’
rights generally or the reorganization of financial institutions; (ii) the
enforceability of the Company’s obligations thereunder is subject to general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law) and to the effect of certain laws and
judicial decisions upon the availability and enforceability of certain
remedies, including the remedies of specific performance and self-help; and (iii) the
indemnification and contribution provisions thereof may be limited under
applicable laws and certain remedies may not be available in the case of a
non-material breach.

 

11.           The Debentures have been duly authorized, executed, authenticated and
delivered in accordance with the Indenture and constitute valid and binding
obligations of the Company and will entitle the holders thereof to the benefits
of the Indenture, enforceable against the Company in accordance with their
terms, except as rights to indemnity and contribution thereunder may be limited
under applicable law or public policy, and subject to the qualifications that (i) enforcement
thereof may be limited by bankruptcy, insolvency, receivership, reorganization,
liquidation, voidable preference, moratorium or other laws (including the laws
of fraudulent conveyance and transfer) or judicial decisions affecting the
enforcement of creditors’ rights generally or the reorganization of financial
institutions; (ii) the enforceability of the Company’s obligations
thereunder is subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law) and to
the effect of certain laws and judicial decisions upon the availability and
enforceability of certain remedies, including the remedies of specific
performance and self-help; and (iii) the indemnification and contribution
provisions thereof may be limited under applicable laws and certain remedies
may not be available in the case of a non-material breach.

 

12.           The shares of common stock of the Company issuable upon exercise of the
Warrants (the “Warrant Shares”), when issued in accordance with the provisions
of the Warrants, including payment of the exercise price thereof, will be duly
authorized, validly issued, fully paid and nonassessable shares of the Company’s
common stock. No preemptive rights of stockholders of the Company exist with
respect to the Warrant Shares under the laws of the Commonwealth of Virginia or
the Company’s Articles of Incorporation or, to the best of our knowledge, any
agreement, instrument or other document.

 

13.
The execution, delivery and performance of the Operative Documents, the
Debentures and the Securities, as applicable, by the Company and the Trust and
the consummation by the Company and the Trust of the transactions contemplated
by the Operative Documents, as applicable, will not result in any violation of
the charter or bylaws of the Company or any subsidiary of the Company, the
Declaration, the Trust Certificate, the terms of any indenture or other agreement
or instrument known to such counsel and to which the Company or any of its
subsidiaries is a party or bound or any judgment, order or decree of any
Governmental Entity having jurisdiction over the Company or any of its
subsidiaries, or any law or administrative regulation of any state applicable
to the Company or any of the subsidiaries.

 

14.
Assuming (i) the accuracy of the representations and warranties, and
compliance with the agreements, contained in the Purchase Agreement and (ii) that
the Preferred Securities are sold in the manner contemplated by, and in
accordance with, the Purchase Agreement and the Declaration, and that the
Warrant Shares are issued in accordance with the terms of the Warrants, it is
not necessary in connection with the offer, sale and delivery of the Preferred
Securities by the Trust to the Purchaser, or the issuance of the Warrant Shares
upon exercise of the Warrants, to register the Securities, the Guarantee
Agreement or the Debentures, the Warrants or
the Warrant Shares under the 1933 Act or to qualify any indenture under the
Trust Indenture Act of 1939, as amended.

 

15.
Neither the Company nor the Trust is, and, following the issuance of the
Preferred Securities and the consummation of the transactions contemplated by
the Operative Documents and the application of the proceeds therefrom, neither
the Company nor the Trust will be, an “investment company” or entity “controlled”
by an “investment company”, in each case within the meaning of Section 3(a) of
the 1940 Act, without regard to Section 3(c) of such Act.

 

20

 

16.
To the best of our knowledge, there is no action, suit, proceeding or other
investigation or inquiry, before any court or before any public body or board
pending or threatened against or involving the Company or any of its
subsidiaries which is required to be disclosed in the 1934 Act Reports and is
not so disclosed and which could reasonably be expected to have a Material
Adverse Effect.

 

In rendering such opinions,
such counsel may (A) state that its opinion is limited to the laws of New
York, the laws of the State of Virginia and the Federal laws of the United
States and (B) rely as to matters involving the application of laws of any
jurisdiction other than New York, Virginia or the United States, to the extent
deemed proper and specified in such opinion, upon the opinion of other counsel
of good standing believed to be reliable and who are satisfactory to you and as
to matters of fact, to the extent deemed proper, on certificates of responsible
officers of the Company and public officials. Further such counsel may assume,
without rendering any opinion to such effect, that the laws of the State of New
York are substantively identical to the laws of the Commonwealth of Virginia,
without regard to conflict of law provisions.

 

21

 

ANNEX B

 

Pursuant to Section 5.A(b) of
the Purchase Agreement, special Delaware counsel for the Trust shall deliver an
opinion in substantially the following form:

 

1.
The Trust has been duly formed and is validly existing in good standing as a
statutory trust under the Delaware Act.

 

2.
The Declaration constitutes a valid and binding obligation of the Sponsor and
Trustees party thereto, enforceable against such Sponsor and Trustees in
accordance with its terms.

 

3.
Under the Delaware Act and the Declaration, the Trust has the requisite trust
power and authority (i) to own its properties and conduct its business,
all as described in the Declaration, (ii) to execute and deliver, and
perform its obligations under, the Operative Documents to which it is a party, (iii) to
authorize, issue, sell and perform its obligations under its Preferred
Securities and Common Securities, and (iv) to purchase and hold the
Debentures.

 

4.
The Preferred Securities have been duly authorized for issuance by the Trust
and, when issued, executed and authenticated in accordance with the Declaration
and delivered against payment therefor in accordance with the Declaration and
the Purchase Agreement, will be validly issued and, subject to the
qualifications set forth in paragraph 5 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust and the holders of
the Preferred Securities will be entitled to the benefits provided by the
Declaration.

 

5.
Each holder of Preferred Securities, in such capacity, will be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State of Delaware. We note, however, that the holders of the Preferred
Securities may be required to make payment or provide indemnity or security as
set forth in the Declaration.

 

6.
Under the Declaration and the Delaware Act, the issuance of the Capital
Securities and Common Securities is not subject to preemptive rights.

 

7.
The Common Securities have been duly authorized for issuance by the Trust and,
when issued and executed in accordance with the Declaration and delivered against
payment therefor in accordance with the Declaration and the subscription
agreement therefor, will be validly issued undivided beneficial interests in
the assets of the Trust and the holders of the Common Securities will be
entitled to the benefits provided by the Declaration.

 

8.
Under the Declaration and the Delaware Act, the execution and delivery by the
Trust of the Operative Documents to which it is a party, and the performance by
the Trust of its obligations thereunder, have been duly authorized by the
requisite trust action on the part of the Trust.

 

9.
The issuance and sale by the Trust of its Preferred Securities and Common
Securities, the execution, delivery and performance by the Trust of the
Operative Documents to which it is a party, the consummation by the Trust of
the transactions contemplated by the Operative Documents to which it is party,
and the compliance by the Trust with its obligations thereunder are not
prohibited by (i) the Declaration or the Trust Certificate, or (ii) any
law or administrative regulation of the State of Delaware applicable to the
Trust.

 

10.
No authorization, approval, consent or order of any Delaware court or Delaware
governmental authority or Delaware agency is required to be obtained by the
Trust solely in connection with the issuance and sale by the Trust of its
Preferred Securities and Common Securities, the due authorization, execution
and delivery by the Trust of the Operative Documents to which it is a party or
the performance by the Trust of its obligations under the Operative Documents
to which it is a party.

 

11.
The holders of the Preferred Securities (other than those holders who reside or
are domiciled in the State of Delaware) will have no liability for income taxes
imposed by the State of Delaware solely as a result of their participation in
the Trust, and the Trust will not be liable for any income tax imposed by the
State of Delaware.

 

22

 

ANNEX C

 

Pursuant
to Section 5.A(c) of the Purchase Agreement, special tax counsel for
the Offerors shall deliver an opinion to the effect that:

 

1.               Under current law and assuming the
performance of the Operative Documents in accordance with the terms described
therein, the Debentures will be treated for United States federal income tax
purposes as indebtedness of the Company.

 

2.               The Trust will be classified for United
States federal income tax purposes as a grantor trust and not as an association
taxable as a corporation.

 

23

 

ANNEX D

 

Pursuant to Section 5(d) of
the Purchase Agreement, counsel to the Guarantee Trustee, the Institutional
Trustee, the Delaware Trustee and the Indenture Trustee shall deliver an
opinion in substantially the following form:

 

1.
Wilmington Trust Company (“WTC”) is a Delaware banking corporation with trust
powers, duly incorporated, validly existing and in good standing under the laws
of the State of Delaware, with requisite corporate power and authority to
execute and deliver, and to perform its obligations under, the Declaration, the
Guarantee Agreement and the Indenture (collectively, the “Transaction Documents”).

 

2.
The execution, delivery, and performance by WTC of the Transaction Documents
have been duly authorized by all necessary corporate action on the part of WTC,
and the Transaction Documents have been duly executed and delivered by WTC.

 

3.
The execution, delivery and performance of the Transaction Documents by WTC and
the consummation of any of the transactions by WTC contemplated thereby are not
prohibited by (i) the charter or bylaws of WTC, (ii) any law or
administrative regulation of the State of Delaware or the United States of
America governing the banking and trust powers of WTC, or (iii) to our
knowledge (based and relying solely on the Officer Certificates), any
agreements or instruments to which WTC is a party or by which WTC is bound or
any judgments or order applicable to WTC.

 

4.
The Debentures delivered on the date hereof have been authenticated by due
execution thereof and delivered by WTC, as Indenture Trustee, in accordance
with the Indenture. The Capital Securities delivered on the date hereof have
been authenticated by due execution thereof and delivered by WTC, as Property
Trustee, in accordance with the Declaration.

 

5.
None of the execution, delivery and performance by WTC of the Transaction
Documents and the consummation of any of the transactions by WTC contemplated
thereby requires the consent, authorization, order or approval of, the
withholding of objection on the part of, the giving of notice to, the
registration with or the taking of any other action in respect of, any
governmental authority or agency under any law or administrative regulation of
the State of Delaware or the United States of America governing the banking and
trust powers of WTC, except for the filing of the Trust Certificate with the
Office of the Secretary of State of the State of Delaware pursuant to the
Delaware Act (which filing has been duly made).

 

24

 

ANNEX E

 

THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAW. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER
THIS SECURITY ONLY (A) TO THE SPONSOR OR THE TRUST, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A
SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A IN
ACCORDANCE WITH RULE 144A, (D) TO A NON-U.S. PERSON IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE)
OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF
RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS CAPITAL SECURITY
FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
INVESTOR FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR
(F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE SPONSOR’S AND THE TRUST’S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM IN ACCORDANCE WITH THE AMENDED AND RESTATED DECLARATION OF TRUST OF
VCBI CAPITAL TRUST IV, A COPY OF WHICH MAY BE OBTAINED FROM THE SPONSOR OR
THE TRUST. HEDGING TRANSACTIONS INVOLVING THIS SECURITY MAY NOT BE
CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

 

25

 

ANNEX F

 

FORM OF PLEDGEE’S
ACKNOWLEDGEMENT AND AGREEMENT

 

TO:         Virginia Commerce Bancorp, Inc.

 

The undersigned hereby advises
Virginia Commerce Bancorp, Inc. (the “Company”) that the undersigned is
the holder of a valid lien, security interest or other encumbrance (the “pledge”)
secured by the below described Trust Preferred Securities of VCBI Capital Trust
IV (the “Preferred Securities”) and/or warrants to purchase shares of Virginia
Commerce Bancorp, Inc. common stock (the “Warrants” and collectively with
the Preferred Securities the “Securities”).

 

The undersigned acknowledges
that it has been provided with a copy of the Purchase Agreement executed by the
registered holder of the Securities (the “Agreement”), and that such Agreement
contains limitations on the ability to transfer and sell the Securities, which
such limitations are prescribed for the purpose of protecting the exemption
from registration under the Securities Act of 1933, as amended and comparable
provisions of state securities laws pursuant to which the Securities were
issued without registration.

 

The undersigned hereby
acknowledges and agrees that the transfer provisions of the Agreement are
applicable to the Securities and that it shall abide by and comply with such
provisions in the event that the undersigned acquires the Securities pursuant
to the terms of the pledge agreement between the undersigned and the registered
holder. This agreement shall be binding upon the undersigned and the
undersigned’s estate, heirs, successors, assigns, transferees and personal
representatives.

 

IN WITNESS WHEREOF, the
undersigned has set its hand, duly authorized, as of this
         day of
                    ,
20      .

 

 

	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
  Organization:

  

 

	
  Pledged Securities:

  	
   

  
	
   

  	
   

  
	
  Preferred Securities Certificate No:

  	
   

  	
   

  	
  Warrant Certificate Number:

  	
   

  
	
   

  	
   

  
	
  Number of Preferred Securities:

  	
   

  	
   

  	
  Number of Shares Subject to Warrant:

  	
   

  
	
   

  	
   

  
	
  Name of Registered Holder:

  	
   

  
									

 

26Exhibit 4.1

 

AMENDMENT
TO RIGHTS AGREEMENT

 

AMENDMENT
TO RIGHTS AGREEMENT, dated September 24, 2008 (the “Amendment”), between PHARMACOPIA,
INC. (as successor by name change to Pharmacopeia Drug Discovery, Inc.), a
Delaware corporation (the “Company”), and AMERICAN STOCK TRANSFER &
TRUST COMPANY, a New York corporation (the “Rights Agent”).

 

Capitalized
terms used but otherwise not defined herein shall have the respective meanings
ascribed to such terms in the Rights Agreement (as hereinafter defined).

 

WHEREAS,
the Company and the Rights Agent are parties to that certain Rights Agreement,
dated April 30, 2004 (the “Rights Agreement”);

 

WHEREAS,
neither the Distribution Date nor the occurrence of any Triggering Event has
occurred as of the date hereof;

 

WHEREAS,
pursuant to Section 27 of the Rights Agreement, the Company has directed
the Rights Agent to enter into this Amendment; and

 

WHEREAS,
the Board of Directors has determined that it is in the best interest of the
Company and its stockholders to amend the Rights Agreement as set forth herein
immediately prior to and in connection with the execution of the Merger
Agreement (as defined below) (pursuant
to which the Parent Parties and the Company will consummate the business
combinations and other transactions provided for therein in order to advance
their respective long-term strategic business interests) in order to render the
Rights inapplicable to the Mergers (as defined in the Merger Agreement) and the
other transactions contemplated by the Merger Agreement.

 

NOW,
THEREFORE, in consideration of these premises and the mutual covenants and
agreements contained herein, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto covenant and agree as follows:

 

1.             Amendments.

 

(a)           Amendment to Section 1(a).
The following text is added at the end of the definition of “Acquiring Person”
in Section 1(a) of the Rights Agreement:

 

“Notwithstanding the
foregoing or anything in this Agreement to the contrary, none of the Parent
Parties shall be deemed to be an Acquiring Person, either individually or
collectively, by virtue of (i) the approval, execution or delivery of the
Merger Agreement, (ii) the announcement of the Mergers, (iii) the
consummation of the Mergers or the other transactions contemplated by the
Merger Agreement or (iv) the acquisition 

 

 

of Common Stock of the
Company pursuant to the Mergers or the Merger Agreement.”

 

(b)           The
following definitions are added to Section 1 of the Rights Agreement in
the appropriate alphabetical order:

 

“Merger 1 Effective
Time” shall have the meaning assigned to such term in the Merger Agreement.

 

“Merger Agreement”
shall mean that certain Agreement and Plan of Merger dated as of September 24,
2008, as the same may be amended from time to time by and among Ligand
Pharmaceuticals Incorporated, a Delaware corporation (“Parent”), Marqaux
Acquisition Corp., a Delaware corporation and direct wholly-owned subsidiary of
Parent (“Merger Sub 1”), Latour Acquisition, LLC, a Delaware limited liability
company and direct wholly-owned subsidiary of Parent (“Merger Sub 2,” and
together with Parent and Merger Sub 1, the “Parent Parties”), and the Company.

 

“Mergers” shall
have the meaning assigned to such term in the Merger Agreement.

 

 “Parent Parties” shall have the meaning
assigned to such term in the Merger Agreement.

 

(c)           Amendment to Section 7(a). Section 7(a) of
the Rights Agreement is hereby amended to read in its entirety as follows:

 

“(a)  Subject to Section 7(e),
the registered holder of any Right Certificate may exercise the Rights
evidenced thereby (except as otherwise provided herein including, without
limitation, the restrictions on exercisability set forth in Section 9(c), Section 11(a)(iii) and
Section 23(a)), in whole or in part at any time after the Distribution
Date, upon surrender of the Right Certificate, with the form of election to
purchase and the certificate on the reverse side thereof duly executed, to the
Rights Agent at the office of the Rights Agent designated for such purpose,
together with payment of the aggregate Purchase Price with respect to the total
number of one one-ten thousandths of a share of Preferred Stock (or other
securities, cash or other assets, as the case may be) as to which such
surrendered Rights are then exercisable, at or prior to the earliest of (i) the
Close of Business on the tenth anniversary hereof, or such later date as may be
established by the Board of Directors prior to the expiration of the Rights
(such date, as it may be extended by the Board of Directors, the “Final
Expiration Date”), (ii) the time at which the Rights are redeemed as
provided in Section 23 (the “Redemption Date”), (iii) the time at
which such Rights are exchanged as 

 

 

provided in Section 24,
or (iv) immediately prior to the Merger 1 Effective Time.”

 

2.             The Rights
Agreement, as supplemented and modified by this Amendment, together with the
other writings referred to in the Rights Agreement or delivered pursuant
thereto which form a part thereof, contain the entire agreement among the
parties with respect to the subject matter thereof and amend, restate and
supersede all prior and contemporaneous arrangements or understandings with
respect thereto.

 

3.             Upon the
effectiveness of this Amendment, on and after the date hereof, each reference
in the Rights Agreement to “this Agreement, “hereunder,” “hereof,” “herein” or
words of like import, shall mean and be a reference to the Rights Agreement, as
amended hereby. Except as specifically amended above, the Rights Agreement
shall remain in full force and effect, without modification, waiver or
amendment, and is hereby ratified and confirmed.

 

4.             This Amendment
shall be deemed to be a contract made under the laws of the State of Delaware
and for all purposes shall be governed by and construed in accordance with the
laws of such State applicable to contracts to be made and performed entirely
within such State; provided, however, that all provisions regarding the rights,
duties and obligations of the Rights Agent shall be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed entirely within such State.

 

5.             This Amendment may
be executed in any number of counterparts and such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument.

 

[signature page follows]

 

 

IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed, all as of the day and year first above written.

 

	
   

  	
  PHARMACOPEIA,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph A.
  Mollica

  
	
   

  	
   

  	
  Name:  Joseph
  A. Mollica

  
	
   

  	
   

  	
  Title:   
  Chairman of the Board of Directors and 

  
	
   

  	
   

  	
  Interim
  President and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AMERICAN
  STOCK TRANSFER & TRUST 

  COMPANY, as Rights Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Herbert J.
  Lemmer

  
	
   

  	
   

  	
  Name:  Herbert
  J. Lemmer

  
	
   

  	
   

  	
  Title:    Vice-President

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