Document:

Exhibit
4.1

 

	
  NUMBER
  

  B-1

  	
   

  	
  SHARES  

  73,000

  

 

Incorporated Under the Laws of the

State of Delaware

 

Please See Transfer Restrictions on Reverse Side

 

This
Certifies that the United States Department
of the Treasury is the owner of Seventy-Three
Thousand (73,000) fully paid and non-assessable shares of the Series B
Fixed Rate Cumulative Perpetual Preferred Stock, par value $1.00 per share, of

 

OLD SECOND BANCORP, INC.

 

transferable
only on the books of the Company by the holder hereof in person, or by duly
authorized Attorney, upon surrender of this Certificate properly endorsed.

 

Any
stockholder may obtain from the principal office of the Company, upon request
and without charge, a statement of the number of shares constituting each class
or series of stock and the designation thereof, and a copy of all the powers,
designations, preferences and relative, participating, optional or other
special rights of each class of stock or series thereof and the qualifications,
limitations or restrictions of such preferences and/or rights and the bylaws.

 

IN
WITNESS WHEREOF, the said Company has caused this Certificate
to be signed by its duly authorized officers and its Corporate Seal hereunto
affixed this 16th day of January, 2009.

 

	
   

  	
   

  	
   

  
	
  Chairman,
  Chief Executive Officer  

  and
  President

  	
   

  	
  Corporate Secretary

  

 

 

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

 

THE SECURITIES REPRESENTED BY
THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT
BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT
RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES
LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.
EACH PURCHASER OF THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS NOTIFIED
THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF THE
SECURITIES REPRESENTED BY THIS INSTRUMENT BY ITS ACCEPTANCE HEREOF (1) REPRESENTS
THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT), (2) AGREES THAT IT WILL NOT OFFER, SELL OR OTHERWISE
TRANSFER THE SECURITIES REPRESENTED BY THIS INSTRUMENT EXCEPT (A) PURSUANT
TO A REGISTRATION STATEMENT WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR
SO LONG AS THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (C) TO THE ISSUER OR (D) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES
THAT IT WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY THIS
INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.Exhibit
4.2

 

WARRANT
TO PURCHASE COMMON STOCK

 

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

 

WARRANT 

to purchase 

815,339

Shares of Common Stock

of Old
Second Bancorp, Inc.

 

Issue
Date: January 16, 2009

 

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

 

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

 

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

 

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

2

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

3

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

4

 

have traded at
least once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the
shares of Common Stock.

 

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

 

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

 

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

 

2.             Number of
Shares; Exercise Price.  This
certifies that, for value received, the United States Department of the
Treasury or its permitted assigns (the “Warrantholder”)
is entitled, upon the terms and subject to the conditions hereinafter set
forth, to acquire from the Company, in whole or in part, after the receipt of
all applicable Regulatory Approvals, if any, up to an aggregate of the number
of fully paid and nonassessable shares of Common Stock set forth in Item 6 of
Schedule A hereto, at a purchase price per share of Common Stock equal to the
Exercise Price.  The number of shares of
Common Stock (the “Shares”) and
the Exercise Price are subject to adjustment as provided herein, and all
references to “Common Stock,” “Shares” and “Exercise Price” herein shall be
deemed to include any such adjustment or series of adjustments.

 

3.             Exercise of
Warrant; Term.  Subject to Section 2,
to the extent permitted by applicable laws and regulations, the right to
purchase the Shares represented by this Warrant is exercisable, in whole or in
part by the Warrantholder, at any time or from time to time after the execution
and delivery of this Warrant by the Company on the date hereof, but in no event
later than 5:00 p.m., New York City time on the tenth anniversary of the
Issue Date (the “Expiration Time”), by (A) the
surrender of this Warrant and Notice of Exercise annexed hereto, duly completed
and executed on behalf of the Warrantholder, at the principal executive office
of the Company located at the address set forth in Item 7 of Schedule A hereto
(or such other office or agency of the Company in the United States as it may
designate by notice in writing to the Warrantholder at the address of the
Warrantholder appearing on the books of the Company), and (B) payment of
the Exercise Price for the Shares thereby purchased:

 

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

 

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

 

If the Warrantholder does
not exercise this Warrant in its entirety, the Warrantholder will be entitled
to receive from the Company within a reasonable time, and in any event not
exceeding three business days, a new warrant in substantially identical form
for the purchase of that number of Shares equal to the difference between the
number of Shares subject to this Warrant and the number of Shares as to which
this Warrant is so exercised.  

 

5

 

Notwithstanding anything
in this Warrant to the contrary, the Warrantholder hereby acknowledges and
agrees that its exercise of this Warrant for Shares is subject to the condition
that the Warrantholder will have first received any applicable Regulatory
Approvals.

 

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

 

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

 

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

 

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

 

6

 

8.                                       Transfer/Assignment.

 

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

 

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

 

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

 

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

 

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

 

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

 

7

 

SEC.  Upon the written request of any
Warrantholder, the Company will deliver to such Warrantholder a written
statement that it has complied with such requirements.

 

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

 

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

 

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

 

(A)  the
number of Shares issuable upon the exercise of this Warrant immediately prior
to the date of the agreement on pricing of such shares (or of such convertible
securities) (the “Initial Number”) shall be
increased to the number obtained by multiplying the Initial Number by a
fraction (A) the numerator of which shall be the sum of (x) the
number of shares of Common Stock of the Company outstanding on such date and (y) the
number of additional shares of Common Stock issued (or into which 

 

8

 

convertible
securities may be exercised or convert) and (B) the denominator of which
shall be the sum of (I) the number of shares of Common Stock outstanding
on such date and (II) the number of shares of Common Stock which the
aggregate consideration receivable by the Company for the total number of
shares of Common Stock so issued (or into which convertible securities may be
exercised or convert) would purchase at the Market Price on the last trading
day preceding the date of the agreement on pricing such shares (or such
convertible securities); and

 

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

 

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

 

(C)                                Other
Distributions.  In case the Company
shall fix a record date for the making of a distribution to all holders of
shares of its Common Stock of securities, evidences of indebtedness, assets,
cash, rights or warrants (excluding Ordinary Cash Dividends, dividends of its
Common Stock and other dividends or distributions referred to in Section 13(A)),
in each such case, the Exercise Price in effect prior to such record date shall
be reduced immediately thereafter to the price determined by multiplying the
Exercise Price in effect immediately prior to the reduction by the quotient of (x) the
Market Price of the Common Stock on the last trading day preceding the first
date on which the Common Stock trades regular way on the principal national
securities exchange on which the Common Stock is listed or admitted to trading
without the right to receive such distribution, minus the amount of cash and/or
the Fair Market Value of the securities, evidences of indebtedness, assets,
rights or warrants to be so distributed in respect of one share of Common Stock
(such amount and/or Fair Market Value, the “Per Share Fair 

 

9

 

Market Value”)
divided by (y) such Market Price on such date specified in clause (x);
such adjustment shall be made successively whenever such a record date is
fixed.  In such event, the number of
Shares issuable upon the exercise of this Warrant shall be increased to the number
obtained by dividing (x) the product of (1) the number of Shares
issuable upon the exercise of this Warrant before such adjustment, and (2) the
Exercise Price in effect immediately prior to the distribution giving rise to
this adjustment by (y) the new Exercise Price determined in accordance
with the immediately preceding sentence. 
In the case of adjustment for a cash dividend that is, or is coincident
with, a regular quarterly cash dividend, the Per Share Fair Market Value would
be reduced by the per share amount of the portion of the cash dividend that
would constitute an Ordinary Cash Dividend. 
In the event that such distribution is not so made, the Exercise Price
and the number of Shares issuable upon exercise of this Warrant then in effect
shall be readjusted, effective as of the date when the Board of Directors
determines not to distribute such shares, evidences of indebtedness, assets,
rights, cash or warrants, as the case may be, to the Exercise Price that would
then be in effect and the number of Shares that would then be issuable upon
exercise of this Warrant if such record date had not been fixed.

 

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

 

(E)                                 Business
Combinations.  In case of any
Business Combination or reclassification of Common Stock (other than a
reclassification of Common Stock referred to in Section 13(A)), the
Warrantholder’s right to receive Shares upon exercise of this Warrant shall be
converted into the right to exercise this Warrant to acquire the number of
shares of stock or other securities or property (including cash) which the
Common Stock issuable (at the time of such Business Combination or
reclassification) upon exercise of this Warrant immediately prior to such
Business Combination or reclassification would have been entitled to receive
upon consummation of such Business Combination or reclassification; and in any
such case, if necessary, the provisions set forth herein with respect to the
rights and interests thereafter of the Warrantholder shall be appropriately
adjusted so as to be applicable, as nearly as may reasonably 

 

10

 

be, to the Warrantholder’s
right to exercise this Warrant in exchange for any shares of stock or other
securities or property pursuant to this paragraph.  In determining the kind and amount of stock,
securities or the property receivable upon exercise of this Warrant following
the consummation of such Business Combination, if the holders of Common Stock
have the right to elect the kind or amount of consideration receivable upon
consummation of such Business Combination, then the consideration that the
Warrantholder shall be entitled to receive upon exercise shall be deemed to be
the types and amounts of consideration received by the majority of all holders
of the shares of common stock that affirmatively make an election (or of all
such holders if none make an election).

 

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

 

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

 

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

 

(I)                                    Other
Events.  For so long as the Original
Warrantholder holds this Warrant or any portion thereof, if any event occurs as
to which the provisions of this Section 13 are not 

 

11

 

strictly applicable or,
if strictly applicable, would not, in the good faith judgment of the Board of
Directors of the Company, fairly and adequately protect the purchase rights of
the Warrants in accordance with the essential intent and principles of such
provisions, then the Board of Directors shall make such adjustments in the
application of such provisions, in accordance with such essential intent and
principles, as shall be reasonably necessary, in the good faith opinion of the
Board of Directors, to protect such purchase rights as aforesaid.  The Exercise Price or the number of Shares
into which this Warrant is exercisable shall not be adjusted in the event of a
change in the par value of the Common Stock or a change in the jurisdiction of
incorporation of the Company.

 

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

 

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

 

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

 

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

 

12

 

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

 

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

 

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

 

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

 

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

 

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

 

20.                                 Notices.  Any notice, request, instruction or other
document to be given hereunder by any party to the other will be in writing and
will be deemed to have been duly given (a) on the

 

13

 

date of delivery
if delivered personally, or by facsimile, upon confirmation of receipt, or (b) on
the second business day following the date of dispatch if delivered by a
recognized next day courier service.  All
notices hereunder shall be delivered as set forth in Item 8 of Schedule A
hereto, or pursuant to such other instructions as may be designated in writing
by the party to receive such notice.

 

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

 

[Remainder
of page intentionally left blank]

 

14

 

[Form of
Notice of Exercise]

 

	
   

  	
  Date:

  	
   

  	
   

  

 

TO:                            Old
Second Bancorp, Inc.

 

RE:                              Election
to Purchase Common Stock

 

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

 

	
  Number of Shares of
  Common Stock

  	
   

  	
   

  

 

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

 

	
  Aggregate Exercise
  Price:

  	
   

  	
   

  

 

	
   

  	
  Holder:

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

15

 

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

 

Dated: January 16,
2009

 

 

	
   

  	
  OLD SECOND BANCORP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Douglas Cheatham

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  J. Douglas Cheatham

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Executive Vice
  President and Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Attest:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robin Hodgson

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Robin Hodgson

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  First Vice President
  and Corporate Secretary

  
					

 

 

[Signature
Page to Warrant]

 

16

 

SCHEDULE
A

 

Item 1

Name:  Old Second Bancorp, Inc.

Corporate or other
organizational form:  Corporation

Jurisdiction of
organization:  Delaware

 

Item 2

Exercise Price:  $13.43

 

Item 3

Issue Date:  January 16, 2009

 

Item 4

Amount of last dividend
declared prior to the Issue Date:  $0.16 per share (declared on December 16, 2008, and payable on January 6,
2009), which represents a quarterly dividend

 

Item 5

Date of Letter Agreement
between the Company and the United States Department of the Treasury:  January 16, 2009

 

Item 6

Number of shares of
Common Stock:  815,339

 

Item 7

Company’s address:  37 South River Street,
Aurora, Illinois  60506

 

Item 8

Notice information:

 

Robin Hodgson

First Vice President and Corporate Secretary

37 South River Street

Aurora, Illinois  60506

(630) 906-5480

rhodgson@oldsecond.com

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