Document:

EX-10.3

CERTIFICATE OF DESIGNATIONS

OF

FIXED RATE CUMULATIVE MANDATORILY CONVERTIBLE PREFERRED STOCK, SERIES G

OF

FIRST BANCORP

First BanCorp, a corporation organized and existing under the laws of the Commonwealth of
Puerto Rico (the “Corporation”), in accordance with the provisions of the Puerto Rico
General Corporation Law of 1995, as amended, does hereby certify:

The board of directors of the Corporation (the “Board of Directors”) or an applicable
committee of the Board of Directors, in accordance with the certificate of incorporation and bylaws
of the Corporation and applicable law, adopted the following resolution on June 22, 2010 creating a
series of 425,000 shares of Preferred Stock of the Corporation designated as “Fixed Rate Cumulative
Mandatorily Convertible Preferred Stock, Series G”.

RESOLVED, that pursuant to the provisions of the certificate of incorporation and the bylaws
of the Corporation and applicable law, a series of Preferred Stock, par value $1.00 per share, of
the Corporation be and hereby is created, and that the designation and number of shares of such
series, and the voting and other powers, preferences and relative, participating, optional or other
rights, and the qualifications, limitations and restrictions thereof, of the shares of such series,
are as follows:

Part 1. Designation and Number of Shares. There is hereby created out of the
authorized and unissued shares of preferred stock of the Corporation a series of preferred stock
designated as the “Fixed Rate Cumulative Mandatorily Convertible Preferred Stock, Series G” (the
"Designated Preferred Stock”). The authorized number of shares of Designated Preferred
Stock shall be 425,000.

Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached
hereto are incorporated herein by reference in their entirety and shall be deemed to be a part of
this Certificate of Designations to the same extent as if such provisions had been set forth in
full herein.

Part 3. Definitions. The following terms are used in this Certificate of Designations
(including the Standard Provisions in Annex A hereto) as defined below:

(a) "Common Stock” means the common stock of the Corporation, which currently has a
par value of $1.00 per share.

(b) "Dividend Payment Date” means February 15, May 15, August 15 and November 15 of
each year.

(c) "Exchange Value” means, for each share of Designated Preferred Stock, an amount
equal to $650.

(d) "Initial Conversion Price” means, for each share of Designated Preferred Stock, an
amount equal to $0.7252.

(e) "Initial Quarterly Dividend” means $0.07.

(f) "Junior Stock” means the Common Stock and any other class or series of stock of
the Corporation the terms of which expressly provide that it ranks junior to Designated Preferred
Stock as to dividend rights and/or as to rights on liquidation, dissolution or winding up of the
Corporation. For purposes of clarification, the junior subordinated debentures issued by the
Corporation in connection with trust preferred securities issued by certain subsidiaries of the
Corporation shall not be deemed to be Junior Stock.

(g) "Liquidation Amount” means $1,000 per share of Designated Preferred Stock.

(h) "Mandatory Conversion Date” means the seventh anniversary of the Original Issue
Date.

(i) "Minimum Amount” means $[?]. [Amount equal to 25% of the aggregate Liquidation
Amount of the Designated Preferred Stock issued on the Original Issue Date]

(j) “Other Preferred Stock” has the meaning set forth in Section 7(b)(iii).

(k) “Other Preferred Stock Exchange” has the meaning set forth in Section 7(b)(iii).

(l) "Parity Stock” means any class or series of stock of the Corporation (other than
Designated Preferred Stock) the terms of which do not expressly provide that such class or series
shall rank senior or junior to Designated Preferred Stock as to dividend rights and/or as to rights
on liquidation, dissolution or winding up of the Corporation (in each case without regard to
whether dividends accrue cumulatively or non-cumulatively). Without limiting the foregoing, Parity
Stock shall include the Corporation’s 7.125% Noncumulative Perpetual Monthly Income Preferred
Stock, Series A, 8.35% Noncumulative Perpetual Monthly Income Preferred Stock, Series B, 7.40%
Noncumulative Perpetual Monthly Income Preferred Stock, Series C, 7.25% Noncumulative Perpetual
Monthly Income Preferred Stock, Series D, and 7.00% Noncumulative Perpetual Monthly Income
Preferred Stock, Series E. For purposes of clarification, the junior subordinated debentures
issued by the Corporation in connection with trust preferred securities issued by certain
subsidiaries of the Corporation shall not be deemed to be Parity Stock.

(m) "Signing Date” means July 7, 2010.

Part 4. Certain Voting Matters. Whether the vote or consent of the holders of a
plurality, majority or other portion of the shares of Designated Preferred Stock and any Voting
Parity Stock has been cast or given on any matter on which the holders of shares of Designated
Preferred Stock are entitled to vote shall be determined by the Corporation by reference to the
specified liquidation amount of the shares voted or covered by the consent as if the Corporation
were liquidated on the record date for such vote or consent, if any, or, in the absence of a record
date, on the date for such vote or consent. For purposes of determining the voting rights of the
holders of the Designation Preferred Stock under Section 13 of the Standard Provisions forming part
of this Certificate of Designations, each holder will be entitled to one vote for each $1,000 of
liquidation preference to which such holder’s shares are entitled.

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, First BanCorp has caused this Certificate of Designations to be
signed by Lawrence Odell, its Executive Vice President and Secretary, this [?] day of [?], 2010.

	 	 	 	FIRST
BANCORP

	 	 	 	By:

Name:

Title:

ANNEX A

STANDARD PROVISIONS

Section 1. General Matters. Each share of Designated Preferred Stock shall be
identical in all respects to every other share of Designated Preferred Stock. The Designated
Preferred Stock shall rank equally with Parity Stock and shall rank senior to Junior Stock with
respect to the payment of dividends and the distribution of assets in the event of any dissolution,
liquidation or winding up of the Corporation.

Section 2. Standard Definitions. As used herein with respect to Designated Preferred
Stock:

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

(b) "Applicable Dividend Rate” means (i) during the period from the Original Issue
Date to, but excluding, the first day of the first Dividend Period commencing on or after January
16, 2014, 5% per annum and (ii) from and after the first day of the first Dividend Period
commencing on or after January 16, 2014, 9% per annum.

(c) "Appraisal Procedure” means a procedure whereby two independent appraisers, one
chosen by the Corporation and one by the Original Designated Preferred Stockholder, 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
Corporation and the Original Designated Preferred Stockholder; otherwise, the average of all three
determinations shall be binding upon the Corporation and the Original Designated Preferred
Stockholder. The costs of conducting any Appraisal Procedure shall be borne by the Corporation.

(d) "Appropriate Federal Banking Agency” means the “appropriate Federal banking
agency” with respect to the Corporation as defined in Section 3(q) of the Federal Deposit Insurance
Act (12 U.S.C. Section 1813(q)), or any successor provision.

(e) "Business Combination” means a merger, consolidation, statutory share exchange or
similar transaction that requires the approval of the Corporation’s stockholders.

(f) "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.

(g) "Bylaws” means the bylaws of the Corporation, as they may be amended from time to
time.

(h) "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.

(i) "Certificate of Designations” means the Certificate of Designations or comparable
instrument relating to the Designated Preferred Stock, of which these Standard Provisions form a
part, as it may be amended from time to time.

(j) "Change of Control” means the occurrence of one of the following:

(i) the consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any “person” becomes the “beneficial owner” (as
these terms are defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or
indirectly, of more than 50% of the Capital Stock of the Corporation that is at the time
entitled to vote by the holder thereof in the election of the Board of Directors (or
comparable body); or

(ii) the first day on which a majority of the members of the Board of Directors are not
Continuing Directors.

(k) "Change of Control Effective Date” has the meaning set forth in Section 10(a).

(l) "Charter” means the Corporation’s certificate or articles of incorporation,
articles of association, or similar organizational document.

(m) "Common Stock Issuance” has the meaning set forth in Section 11(d).

(n) "Common Stock Offering” means the sale and issuance for cash by the Corporation to
persons other than the Corporation or any of its subsidiaries after the Original Issue Date of
shares of Common Stock (other than any such sales and issuances made pursuant to agreements or
arrangements entered into, or pursuant to financing plans which were publicly announced, on or
prior to the Signing Date).

(o) “Company Material Adverse Effect” means a material adverse effect on the business,
results of operation or financial condition of the Corporation and its consolidated subsidiaries
taken as a whole; provided, however, that Company Material Adverse Effect shall not be deemed to
include the effects of (i) changes after the date hereof in general business, economic or market
conditions (including changes generally in prevailing interest rates, credit availability and
liquidity, currency exchange rates and price levels or trading volumes in the United States or
foreign securities or credit markets), or any outbreak or escalation of hostilities, declared or
undeclared acts of war or terrorism, in each case generally affecting the industries in which the
Corporation and its subsidiaries operate, (ii) changes or proposed changes after the date hereof in
United States generally accepted accounting principles or regulatory accounting requirements, or
authoritative interpretations thereof, (iii) changes or proposed changes after date hereof in
securities, banking and other laws of general applicability or related policies or interpretations
of Governmental Entities (in the case of each of these clauses (i), (ii) and (iii), other than
changes or occurrences to the extent that such changes or occurrences have or would reasonably be
expected to have a materially disproportionate adverse effect on the Corporation and its
consolidated subsidiaries taken as a whole relative to comparable U.S. banking or financial
services organizations), or (iv) changes in the market price or trading volume of the Common Stock
or any other equity, equity-related or debt securities of the Corporation or its consolidated
subsidiaries (it being understood and agreed that the exception set forth in this clause (iv) does
not apply to the underlying reason giving rise to or contributing to any such change).

(p) "Continuing Directors” means, as of any date of determination, any member of the
Board of Directors who (i) was a member of the Board of Directors on the Original Issue Date or
(ii) was nominated for election or elected to the Board of Directors with the approval of a
majority of the Continuing Directors who were members of the Board of Directors at the time of such
new director’s nomination or election.

(q) "Conversion Date” means any date on which shares of Designated Preferred Stock are
converted as set forth in this Certificate of Designations.

(r) "Conversion Price” means the Initial Conversion Price, subject to adjustment as
set forth in Section 11 of this Certificate of Designations.

(s) "Conversion Rate” means for each share of Designated Preferred Stock, the Exchange
Value divided by the Conversion Price, subject to adjustment as set forth in Section 11 of this
Certificate of Designations.

(t) "Convertible Securities” has the meaning set forth in Section 11(c).

(u) "Depositary” means The Depository Trust Company or its nominee or any successor
depositary appointed by the Corporation.

(v) "Dividend Period” has the meaning set forth in Section 3(a).

(w) "Dividend Record Date” has the meaning set forth in Section 3(a).

(x) "Early Conversion” has the meaning set forth in Section 7(a).

(y) "Early Conversion Date” has the meaning set forth in Section 7(c).

(z) "Equity Investor” has the meaning set forth in Section 7(b)(iv).

	 	 	 
	(aa)

	 	“Equity Raise” has the meaning set forth in Section 7(b)(iv).
	
 
	 	 
	(bb)

	 	“Equity Raise Issuance” has the meaning set forth in Section 11(c).
	
 
	 	 

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

(dd) "Ex-Dividend Date” means, in respect of a dividend or distribution to holders of
Common Stock, the first date on which a sale of the Common Stock does not automatically transfer
the right to receive the relevant dividend or distribution from the seller of the Common Stock to
its buyer.

(ee) "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. For so long as the Original Designated Preferred Stockholder holds the
Designated Preferred Stock or any portion thereof, it may object in writing to the Board of
Directors’ calculation of fair market value within 10 days of receipt of written notice thereof.
If the Original Designated Preferred Stockholder and the Corporation are unable to agree on fair
market value during the 10-day period following the delivery of the Original Designated Preferred
Stockholder’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 Designated Preferred Stockholder’s objection.

(ff) “Governmental Entities” means all United States and other governmental,
regulatory or judicial authorities.

(gg) "Liquidation Preference” has the meaning set forth in Section 4(a).

(hh) "Market Price” means, with respect to the Common Stock, on any given date, the
average VWAP for the 5 consecutive Trading Day-period ending on the Trading Day immediately
preceding such given date. “Market Price” shall be determined without reference to after hours or
extended hours trading. If the Common Stock 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 Designated
Preferred Stock is held by the Original Designated Preferred Stockholder, the fair market value per
share of the Common Stock as determined in good faith by the Original Designated Preferred
Stockholder or (ii) in all other circumstances, the fair market value per share of the Common Stock
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 Corporation for this purpose
and certified in a resolution to the holder(s) of Designated Preferred Stock. 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 NYSE 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 time).

	 	 	 
	(ii)

	 	“NASDAQ” means NASDAQ Stock Market LLC.
	
 
	 	 
	(jj)

	 	“NYSE” means the New York Stock Exchange.
	
 
	 	 

(kk) "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 Original Issue Date to
the extent the aggregate per share dividends paid on the outstanding Common Stock in any quarter
exceed the Initial Quarterly Dividend, as adjusted for any stock split, stock dividend, reverse
stock split, reclassification or similar transaction.

(ll) "Original Designated Preferred Stockholder” means the United States Department of
the Treasury and any successor or assign that is an Affiliate of the United States Department of
the Treasury. Any actions specified to be taken by the Original Designated Preferred Stockholder
hereunder may only be taken by such Person and not by any other holder of Designated Preferred
Stock.

(mm) "Original Issue Date” means the date on which shares of Designated Preferred
Stock are first issued.

	 	 	 
	(nn)

	 	“Permitted Transactions” has the meaning set forth in Section 11(d).
	
 
	 	 
	(oo)

	 	“Per Share Fair Market Value” has the meaning set forth in Section 11(e).
	
 
	 	 

(pp) "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.

(qq) "Preferred Director” has the meaning set forth in Section 13(b).

(rr) "Preferred Stock” means any and all series of preferred stock of the Corporation,
including the Designated Preferred Stock.

(ss) "Pro Rata Repurchase” means any purchase of shares of Common Stock by the
Corporation 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 Corporation, other securities of the Corporation,
evidences of indebtedness of the Corporation 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 the Designated Preferred Stock is
outstanding. The “Effective Date” of a Pro Rata Repurchase shall mean the date of
acceptance of shares of Common Stock for purchase or exchange by the Corporation 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.

(tt) "Regulatory Approvals” with respect to the holder of the Designated Preferred
Stock, means, to the extent applicable and required to permit the conversion of the Designated
Preferred Stock for Shares and to own such Shares without such holder being in violation of any
applicable law, rule or regulation, including, without limitation, the Bank Holding Company Act of
1956, as amended, and the Change in Bank Control Act of 1978, as amended, and 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 any other applicable laws and the rules and regulations
thereunder.

(uu) "Regulatory Event” means, with respect to the Corporation, that (i) the Federal
Deposit Insurance Corporation or any other governmental authority shall be appointed as conservator
or receiver for the Corporation; (ii) the Corporation shall have been considered in “troubled
condition” for the purposes of 12 U.S.C. Sec. 1831i or any regulation promulgated thereunder; (iii)
the Corporation shall qualify as “Undercapitalized,” “Significantly Undercapitalized,” or
“Critically Undercapitalized” as those terms are defined in 12 C.F.R. Sec, 208.43; or (iv) the
Corporation shall have become subject to any formal or informal regulatory action requiring the
Corporation to materially improve its capital, liquidity or safety and soundness.

(vv) "Share Dilution Amount” has the meaning set forth in Section 3(b).

(ww) "Shares” means the shares of the Corporation’s Common Stock issuable upon
conversion of the Designated Preferred Stock.

(xx) "Special Distribution” means a distribution on the Common Stock of:

(i) rights, options or warrants (other than pursuant to a shareholder rights plan)
entitling holders of Common Stock to purchase, for a period of 45 calendar days or less,
            shares of Common Stock at a price less than the average Market Price of the Common Stock for
the 10 consecutive Trading Days immediately preceding the declaration date for such
distribution; or

(ii) cash or other assets, debt securities or rights to purchase the Corporation’s
securities (other than pursuant to a shareholder rights plan or a dividend or distribution
on the Common Stock in shares of Common Stock), which distribution has a per share value as
determined by the Board of Directors exceeding 10% of the Market Price of the Common Stock
on the Trading Day preceding the declaration date for such distribution.

(yy) "Specified Corporate Transaction” has the meaning set forth in Section 9(a).

(zz) "Standard Provisions” mean these Standard Provisions that form a part of the
Certificate of Designations relating to the Designated Preferred Stock.

(aaa) [Reserved.]

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

	 	 	 
	(ccc)

(ddd)

	 	[Reserved.]

[Reserved.]

(eee) “Voting Parity Stock” means, with regard to any matter as to which the holders
of Designated Preferred Stock are entitled to vote as specified in Sections 13(a) and 13(b) of
these Standard Provisions that form a part of the Certificate of Designations, any and all series
of Parity Stock upon which like voting rights have been conferred and are exercisable with respect
to such matter.

(fff) “VWAP” means the volume-weighted average trading price of a share of Common
Stock as reported by Bloomberg LP.

Section 3. Dividends.

(a) Rate. Holders of Designated Preferred Stock shall be entitled to receive, on each
share of Designated Preferred Stock if, as and when declared by the Board of Directors or any duly
authorized committee of the Board of Directors, but only out of funds legally available therefor,
cumulative cash dividends (subject to Section 6(e) below) with respect to each Dividend Period (as
defined below) at a rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation
Amount per share of Designated Preferred Stock and (ii) the amount of accrued and unpaid dividends
for any prior Dividend Period on such share of Designated Preferred Stock, if any. Such dividends
shall begin to accrue and be cumulative from the Original Issue Date, shall compound on each
subsequent Dividend Payment Date (i.e., no dividends shall accrue on other dividends unless and
until the first Dividend Payment Date for such other dividends has passed without such other
dividends having been paid on such date) and shall be payable quarterly in arrears on each Dividend
Payment Date, commencing with the first such Dividend Payment Date to occur at least 20 calendar
days after the Original Issue Date. In the event that any Dividend Payment Date would otherwise
fall on a day that is not a Business Day, the dividend payment due on that date shall be postponed
to the next day that is a Business Day and no additional dividends shall accrue as a result of that
postponement. The period from and including any Dividend Payment Date to, but excluding, the next
Dividend Payment Date is a “Dividend Period”, provided that the initial Dividend Period
shall be the period from and including the Original Issue Date to, but excluding, the next Dividend
Payment Date.

Dividends that are payable on Designated Preferred Stock in respect of any Dividend Period
shall be computed on the basis of a 360-day year consisting of twelve 30-day months. The amount of
dividends payable on Designated Preferred Stock on any date prior to the end of a Dividend Period,
and for the initial Dividend Period, shall be computed on the basis of a 360-day year consisting of
twelve 30-day months, and actual days elapsed over a 30-day month.

Dividends that are payable on Designated Preferred Stock on any Dividend Payment Date shall be
payable to holders of record of Designated Preferred Stock as they appear on the stock register of
the Corporation on the applicable record date, which shall be the 15th calendar day immediately
preceding such Dividend Payment Date or such other record date fixed by the Board of Directors or
any duly authorized committee of the Board of Directors that is not more than 60 nor less than 10
days prior to such Dividend Payment Date (each, a “Dividend Record Date”). Any such day
that is a Dividend Record Date shall be a Dividend Record Date whether or not such day is a
Business Day.

Holders of Designated Preferred Stock shall not be entitled to any dividends, whether payable
in cash, securities or other property, other than dividends (if any) declared and payable on
Designated Preferred Stock as specified in this Section 3 (subject to the other provisions of the
Certificate of Designations).

(b) Priority of Dividends. So long as any share of Designated Preferred Stock remains
outstanding, no dividend or distribution shall be declared or paid on the Common Stock or any other
shares of Junior Stock (other than dividends payable solely in shares of Common Stock) or Parity
Stock, subject to the immediately following paragraph in the case of Parity Stock, and no Common
Stock, Junior Stock or Parity Stock shall be, directly or indirectly, purchased, redeemed or
otherwise acquired for consideration by the Corporation or any of its subsidiaries unless all
accrued and unpaid dividends for all past Dividend Periods, including the latest completed Dividend
Period (including, if applicable as provided in Section 3(a) above, dividends on such amount), on
all outstanding shares of Designated Preferred Stock have been or are contemporaneously declared
and paid in full (or have been declared and a sum sufficient for the payment thereof has been set
aside for the benefit of the holders of shares of Designated Preferred Stock on the applicable
record date). The foregoing limitation shall not apply to (i) redemptions, purchases or other
acquisitions of shares of Common Stock or other Junior Stock in connection with the administration
of any employee benefit plan in the ordinary course of business (including purchases to offset the
Share Dilution Amount (as defined below) pursuant to a publicly announced repurchase plan) and
consistent with past practice, provided that any purchases to offset the Share Dilution Amount
shall in no event exceed the Share Dilution Amount; (ii) purchases or other acquisitions by a
broker-dealer subsidiary of the Corporation solely for the purpose of market-making, stabilization
or customer facilitation transactions in Junior Stock or Parity Stock in the ordinary course of its
business; (iii) purchases by a broker-dealer subsidiary of the Corporation of Capital Stock of the
Corporation for resale pursuant to an offering by the Corporation of such Capital Stock
underwritten by such broker-dealer subsidiary; (iv) any dividends or distributions of rights or
Junior Stock in connection with a stockholders’ rights plan or any redemption or repurchase of
rights pursuant to any stockholders’ rights plan; (v) the acquisition by the Corporation or any of
its subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership
of any other Persons (other than the Corporation or any of its subsidiaries), including as trustees
or custodians; and (vi) the exchange or conversion of Junior Stock for or into other Junior Stock
or of Parity Stock for or into other Parity Stock (with the same or lesser aggregate liquidation
amount) or Junior Stock, in each case, solely to the extent required pursuant to binding
obligations entered into prior to the Signing Date or any subsequent agreement for the accelerated
exercise, settlement or exchange thereof for Common Stock. “Share Dilution Amount” means
the increase in the number of diluted shares outstanding (determined in accordance with generally
accepted accounting principles in the United States, and as measured from the date of the
Corporation’s consolidated financial statements most recently filed with the Securities and
Exchange Commission prior to the Original Issue Date) resulting from the grant, vesting or exercise
of equity-based compensation to employees and equitably adjusted for any stock split, stock
dividend, reverse stock split, reclassification or similar transaction.

When dividends are not paid (or declared and a sum sufficient for payment thereof set aside
for the benefit of the holders thereof on the applicable record date) on any Dividend Payment Date
(or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment
Dates, on a dividend payment date falling within a Dividend Period related to such Dividend Payment
Date) in full upon Designated Preferred Stock and any shares of Parity Stock (other than
noncumulative dividends that are not declared on a dividend payment date which the Company
therefore has no obligation to pay), all dividends declared on Designated Preferred Stock and all
such Parity Stock and payable on such Dividend Payment Date (or, in the case of Parity Stock having
dividend payment dates different from the Dividend Payment Dates, on a dividend payment date
falling within the Dividend Period related to such Dividend Payment Date) shall be declared pro
rata so that the respective amounts of such dividends declared shall bear the same ratio to each
other as all accrued and unpaid dividends per share on the shares of Designated Preferred Stock
(including, if applicable as provided in Section 3(a) above, dividends on such amount) and all
Parity Stock payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend
payment dates different from the Dividend Payment Dates, on a dividend payment date falling within
the Dividend Period related to such Dividend Payment Date) (subject to their having been declared
by the Board of Directors or a duly authorized committee of the Board of Directors out of legally
available funds and including, in the case of Parity Stock that bears cumulative dividends, all
accrued but unpaid dividends) bear to each other. If the Board of Directors or a duly authorized
committee of the Board of Directors determines not to pay any dividend or a full dividend on a
Dividend Payment Date, the Corporation shall provide written notice to the holders of Designated
Preferred Stock prior to such Dividend Payment Date.

Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or
other property) as may be determined by the Board of Directors or any duly authorized committee of
the Board of Directors may be declared and paid on any securities, including Common Stock and other
Junior Stock, from time to time out of any funds legally available for such payment, and holders of
Designated Preferred Stock shall not be entitled to participate in any such dividends.

Section 4. Liquidation Rights.

(a) Voluntary or Involuntary Liquidation. In the event of any liquidation,
dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary,
holders of Designated Preferred Stock shall be entitled to receive for each share of Designated
Preferred Stock, out of the assets of the Corporation or proceeds thereof (whether capital or
surplus) available for distribution to stockholders of the Corporation, subject to the rights of
any creditors of the Corporation, before any distribution of such assets or proceeds is made to or
set aside for the holders of Common Stock and any other stock of the Corporation ranking junior to
Designated Preferred Stock as to such distribution, payment in full in an amount equal to the sum
of (i) the Liquidation Amount per share and (ii) the amount of any accrued and unpaid dividends
(including, if applicable as provided in Section 3(a) above, dividends on such amount), whether or
not declared, to the date of payment (such amounts collectively, the “Liquidation
Preference”).

(b) Partial Payment. If in any distribution described in Section 4(a) above the
assets of the Corporation or proceeds thereof are not sufficient to pay in full the amounts payable
with respect to all outstanding shares of Designated Preferred Stock and the corresponding amounts
payable with respect of any other stock of the Corporation ranking equally with Designated
Preferred Stock as to such distribution, holders of Designated Preferred Stock and the holders of
such other stock shall share ratably in any such distribution in proportion to the full respective
distributions to which they are entitled.

(c) Residual Distributions. If the Liquidation Preference has been paid in full to
all holders of Designated Preferred Stock and the corresponding amounts payable with respect of any
other stock of the Corporation ranking equally with Designated Preferred Stock as to such
distribution has been paid in full, the holders of other stock of the Corporation shall be entitled
to receive all remaining assets of the Corporation (or proceeds thereof) according to their
respective rights and preferences.

(d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes of this
Section 4, the merger or consolidation of the Corporation with any other corporation or other
entity, including a merger or consolidation in which the holders of Designated Preferred Stock
receive cash, securities or other property for their shares, or the sale, lease or exchange (for
cash, securities or other property) of all or substantially all of the assets of the Corporation,
shall not constitute a liquidation, dissolution or winding up of the Corporation.

Section 5. Redemption.

(a) Optional Redemption. The Corporation, at its option, subject to the approval of
the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time and from time
to time, out of funds legally available therefor, the shares of Designated Preferred Stock at the
time outstanding, upon notice given as provided in Section 5(c) below, at a redemption price equal
to the sum of (i) (A) the Liquidation Amount per share or (B) if redeemed on or after the first
Dividend Payment Date falling on or after the second anniversary of the Original Issue Date, the
greater of (1) the Liquidation Amount per share and (2) the product of the Conversion Rate and the
average of the Market Prices per share of Common Stock over the 20 consecutive Trading Day period
beginning on the Trading Day after the notice of redemption is given as provided in Section 5(c)
below and (ii) except as otherwise provided below, any accrued and unpaid dividends to, but
excluding, the date fixed for redemption (including, if applicable, as provided in Section 3(a)
above, dividends on such amount), regardless of whether any dividends are actually declared;
provided that the aggregate redemption price of the Designated Preferred Stock redeemed pursuant to
this paragraph may not exceed an amount equal to the sum of (x) any aggregate gross proceeds of not
less than the Minimum Amount received by the Corporation from one or more Common Stock Offerings
and (y) any net increase to the Corporation’s retained earnings after the Original Issue Date above
the Corporation’s retained earnings reflected in its most recent publicly available balance sheet
on or prior to the Original Issue Date; and provided further that the minimum number of shares of
Designated Preferred Stock redeemed by the Corporation upon any such redemption shall be at least
equal to the lesser of (x) all shares of Designated Preferred Stock then outstanding and (y) 25% of
the number of shares of Designated Preferred Stock issued on the Original Issue Date.

The redemption price for any shares of Designated Preferred Stock shall be payable in cash on
the redemption date to the holder of such shares against surrender of the certificate(s) evidencing
such shares to the Corporation or its agent. Any declared but unpaid dividends payable on a
redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall not
be paid to the holder entitled to receive the redemption price on the redemption date, but rather
shall be paid to the holder of record of the redeemed shares on such Dividend Record Date relating
to the Dividend Payment Date as provided in Section 3 above.

(b) No Sinking Fund. The Designated Preferred Stock shall not be subject to any
mandatory redemption, sinking fund or other similar provisions. Holders of Designated Preferred
Stock shall have no right to require redemption or repurchase of any shares of Designated Preferred
Stock.

(c) Notice of Redemption. Notice of every redemption of shares of Designated
Preferred Stock shall be given by first class mail, postage prepaid, addressed to the holders of
record of the shares of Designated Preferred Stock to be redeemed at their respective last
addresses appearing on the books of the Corporation. Such mailing shall be at least 30 days (or in
the event of a redemption on or after the first Dividend Payment Date falling on or after the
second anniversary of the Original Issue Date, at least 25 Trading Days) and not more than 60 days
before the date fixed for redemption. Any notice mailed as provided in this Subsection shall be
conclusively presumed to have been duly given, whether or not the holder receives such notice, but
failure duly to give such notice by mail, or any defect in such notice or in the mailing thereof,
to any holder of shares of Designated Preferred Stock designated for redemption shall not affect
the validity of the proceedings for the redemption of any other shares of Designated Preferred
Stock. Notwithstanding the foregoing, if shares of Designated Preferred Stock are issued in
book-entry form through the Depositary or any other similar facility, notice of redemption may be
given to the holders of Designated Preferred Stock at such time and in any manner permitted by such
facility. Each notice of redemption given to a holder shall state: (1) the redemption date; (2) the
number of shares of Designated Preferred Stock to be redeemed and, if less than all the shares held
by such holder are to be redeemed, the number of such shares to be redeemed from such holder; (3)
the redemption price (or the manner of calculation thereof); and (4) the place or places where
certificates for such shares are to be surrendered for payment of the redemption price.

(d) Partial Redemption. In case of any redemption of part of the shares of Designated
Preferred Stock at the time outstanding, the shares to be redeemed shall be selected either pro
rata or in such other manner as the Board of Directors or a duly authorized committee thereof may
determine to be fair and equitable. Subject to the provisions hereof, the Board of Directors or a
duly authorized committee thereof shall have full power and authority to prescribe the terms and
conditions upon which shares of Designated Preferred Stock shall be redeemed from time to time. If
fewer than all the shares represented by any certificate are redeemed or converted, a new
certificate shall be issued representing the unredeemed shares without charge to the holder
thereof.

(e) Effectiveness of Redemption. If notice of redemption has been duly given and if
on or before the redemption date specified in such notice all funds necessary for the redemption
have been deposited by the Corporation, in trust for the pro rata benefit of the holders of the
shares of Designated Preferred Stock called for redemption, with a bank or trust company doing
business in the Borough of Manhattan, The City of New York, and having a capital and surplus of at
least $500 million and selected by the Board of Directors, so as to be and continue to be available
solely therefor, then, notwithstanding that any certificate for any share of Designated Preferred
Stock so called for redemption has not been surrendered for cancellation, on and after the
redemption date dividends shall cease to accrue on all Designated Preferred Stock so called for
redemption, all shares of Designated Preferred Stock so called for redemption shall no longer be
deemed outstanding and all rights with respect to such shares of Designated Preferred Stock shall
forthwith on such redemption date cease and terminate, except only the right of the holders thereof
to receive the amount payable on such redemption from such bank or trust company, without interest.
Any funds unclaimed at the end of three years from the redemption date shall, to the extent
permitted by law, be released to the Corporation, after which time the holders of the shares of
Designated Preferred Stock so called for redemption shall look only to the Corporation for payment
of the redemption price of such shares of Designated Preferred Stock.

(f) Status of Redeemed Shares. Shares of Designated Preferred Stock that are
redeemed, repurchased or otherwise acquired by the Corporation shall revert to authorized but
unissued shares of Preferred Stock (provided that any such cancelled shares of Designated Preferred
Stock may be reissued only as shares of any series of Preferred Stock other than Designated
Preferred Stock).

Section 6. General Conversion Provisions.

(a) Conversion by Holders; Approvals. Holders of Designated Preferred Stock shall
have the right, at their option, to convert, at any time and from time to time, all or any portion
of the Designated Preferred Stock (but in no event less than one share of the Designated Preferred
Stock), into a number of Shares equal to the product of the then-applicable Conversion Rate and the
number of shares of Designated Preferred Stock surrendered for conversion in accordance with the
terms and conditions of this Certificate of Designations (which, in the event of a Specified
Corporate Transaction or a Change of Control, shall include the provisions of Sections 9 and 10,
respectively); provided, however, notwithstanding anything in this Certificate of Designations to
the contrary, holders of Designated Preferred Stock shall not be entitled to convert shares of
Designated Preferred Stock until the converting holder has first received any applicable Regulatory
Approvals; provided, further, notwithstanding anything in this Certificate of Designations to the
contrary, the Designated Preferred Stock may not be converted until the Corporation shall first
have obtained, to the extent required by applicable law or regulation or necessary in order to
comply with any requirement of any securities exchange on which the Shares are listed or traded,
all stockholder approvals required to effect the conversion and completed all other actions
necessary to effect the conversion.

(b) Effectiveness of Conversion. If any notice of conversion has been duly given in
accordance with the procedures set forth in Sections 7, 8, 9 and 10 below, then, effective
immediately (notwithstanding that any certificate for any Designated Preferred Stock to be
converted has not been surrendered for conversion) prior to 5:00 p.m., New York City time, on the
applicable Conversion Date, holders of Designated Preferred Stock whose shares of Designated
Preferred Stock are to be converted shall cease to have any rights to such shares of Designated
Preferred Stock (including with respect to dividends) subject to the right of any such holders to
receive any accrued and unpaid dividends to the Conversion Date on such shares of Designated
Preferred Stock and any other payments to which they are otherwise entitled pursuant to the terms
hereof.

(c) No Rights as Holders of Common Stock Prior to Conversion. The person or persons
entitled to receive the Shares issuable upon conversion shall be treated for all purposes as the
record holder(s) of such Shares as of 5:00 p.m., New York City time, on the applicable Conversion
Date notwithstanding that the stock transfer books of the Corporation may then be closed or
certificates representing such Shares may not be actually delivered on such date, provided that in
the event of a conversion pursuant to Section 9 or 10 below, the holder(s) of Designated Preferred
Stock has complied with Section 9(c) or 10(c), respectively. No allowance or adjustment, except as
set forth in Section 11, shall be made in respect of dividends payable to holders of Common Stock
of record as of any date prior to such Conversion Date. Prior to the applicable Conversion Date,
Shares issuable upon conversion of Designated Preferred Stock shall not be deemed outstanding for
any purpose, and holders of Designated Preferred Stock shall have no rights with respect to the
Common Stock (including voting rights, rights to respond to tender offers for the Common Stock and
rights to receive any dividends or other distributions on the Common Stock) by virtue of holding
shares of Designated Preferred Stock.

(d) Delivery of Shares and Cash. The Corporation shall deliver to the holders of
Designated Preferred Stock that have been converted the Shares and any amount of cash to which such
holders are entitled on or prior to the third Trading Day immediately following the applicable
Conversion Date. If fewer than all the shares of Designated Preferred Stock represented by any
certificate are converted, a new certificate shall be issued representing the unconverted shares of
Designated Preferred Stock without charge to the holder thereof.

(e) Accrued and Unpaid Dividends. Upon a conversion of any shares of Designated
Preferred Stock as set forth in Sections 6, 7, 8, 9 and 10, the holders of such shares shall
receive all accrued and unpaid dividends on such shares in cash out of funds legally available
therefor or, at the option of the Corporation, in substitute in whole or in part for such cash, in
fully paid and nonassessable shares of Common Stock legally available for such purpose to, but
excluding, the applicable Conversion Date. Accrued and unpaid dividends paid in shares of Common
Stock shall be paid by delivering to each holder of Designated Preferred Stock entitled thereto a
number of shares of Common Stock determined by dividing the total amount of the cash payment of
accrued and unpaid dividends that would otherwise be payable to such holder (rounded to the nearest
whole cent) by the Market Price on the second Trading Day preceding the applicable Conversion Date.
The issuance of any such shares of Common Stock in such amount shall constitute full payment of
all accrued and unpaid dividends that would otherwise have been payable. The Board of Directors of
the Corporation shall determine the form of payment of accrued and unpaid dividends with respect to
any conversion and such election shall be set forth in the applicable notice provided to holders of
the Designated Preferred Stock by the Corporation as set forth in Sections 7, 8, 9 and 10 below.

(f) Dividends Accrued after Record Date. Any accrued and unpaid dividends payable on
shares of Designated Preferred Stock to be converted on a Conversion Date that occurs subsequent to
the Dividend Record Date for a Dividend Period shall not be paid to the holder of record of such
shares on such Dividend Record Date, but rather shall be paid to the holder of such shares on such
Conversion Date.

(g) Notices by the Corporation. Every notice required to be given by the Corporation
pursuant to Section 7, 8, 9 or 10 below shall be given by first class mail, postage prepaid,
addressed to the holders of record of the Designated Preferred Stock at their respective last
addresses appearing on the books of the Corporation and shall contain the information required by
Section 7, 8, 9 or 10 hereof, as applicable. Any notice by the Corporation mailed within the time
period specified in Section 7, 8, 9 or 10 below shall be conclusively presumed to have been duly
given, whether or not the holder receives such notice, but failure duly to give such notice by
mail, or any defect in such notice or in the mailing thereof, to any holder of shares of Designated
Preferred Stock designated for conversion shall not affect the validity of the proceedings for the
conversion of any other shares of Designated Preferred Stock. Notwithstanding the foregoing, if
shares of Designated Preferred Stock are issued in book-entry form through the Depositary or any
other similar facility, any notice by the Corporation may be given to the holders of Designated
Preferred Stock at such time and in any manner permitted by such facility.

(h) Conversion Procedures by Holder. To effect a conversion, a holder of the
Designated Preferred Stock shall: (i) with respect to a conversion pursuant to Section 6, 9 or 10,
complete and manually sign the conversion notice, if any, provided by the Corporation or, if
applicable, the conversion agent appointed by the Corporation, or a facsimile of the conversion
notice; (ii) with respect to a conversion pursuant to Section 6, 9 or 10, deliver the completed
conversion notice, (iii) with respect to any conversion, deliver the certificated shares of
Designated Preferred Stock to be converted to the Corporation or, if applicable, the conversion
agent appointed by the Corporation; and (iv) with respect to any conversion, if required, furnish
appropriate endorsements and transfer documents. If a holder’s interest is a beneficial interest
in a global certificate representing the Designated Preferred Stock, a holder must comply with the
Depositary’s procedures for converting a beneficial interest in a global security.

(i) Taxes and Duties. A holder of the Designated Preferred Stock shall not be
required to pay any transfer or similar taxes or duties relating to the issuance or delivery of
Shares if such holder of the Designated Preferred Stock exercises its conversion rights, but such
holder of the Designated Preferred Stock shall be required to pay any transfer or similar tax or
duty that may be payable relating to any transfer involved in the issuance or delivery of Shares in
a name other than the name of such holder. A certificate representing Shares shall be issued and
delivered only after all applicable taxes and duties, if any, payable by the holder of the
Designated Preferred Stock have been paid in full.

(j) No Fractional Shares. No fractional shares of Common Stock shall be issued as a
result of any conversion of shares of Designated Preferred Stock or the payment of accrued and
unpaid dividends on the Designated Preferred Stock in the form of Common Stock. In lieu of any
fractional share of Common Stock otherwise issuable in respect of any conversion or payment of
accrued and unpaid dividends, the Corporation shall pay an amount in cash (computed to the nearest
cent) equal to such fraction of a share of Common Stock multiplied by the Market Price on the
second Trading Day immediately preceding the applicable Conversion Date or, in the event of any
dividends arising under the Designated Preferred Stock paid in the form of Common Stock, the
Dividend Payment Date (unless there are no legally available assets with which to make such cash
payment, in which event such cash payment shall be made as soon as possible thereafter). If more
than one share of the Designated Preferred Stock is surrendered for conversion at one time by or
for the same holder, the number of full shares of Common Stock issuable upon conversion thereof,
including in respect of accrued and unpaid dividends, shall be computed on the basis of the
aggregate number of shares of the Designated Preferred Stock so surrendered.

(k) Status of Shares Subject to Conversion. Shares of Designated Preferred Stock that
are converted in accordance with Sections 6, 7, 8, 9 or 10 shall revert to authorized but unissued
shares of Preferred Stock (provided that any such cancelled shares of Designated Preferred Stock
may be reissued only as shares of any series of Preferred Stock other than Designated Preferred
Stock).

Section 7. Early Conversion.

(a) Conversion at the Option of the Corporation. Subject to Section 7(b), the
Corporation shall have the right, at its option to convert, at any time and from time to time, all
or any portion of the Designated Preferred Stock (but in no event less than one share of the
Designated Preferred Stock), at any time prior to the date that is nine (9) months following the
date of the Exchange Agreement (“Early Conversion”), into a number of Shares equal to the
product of the then-applicable Conversion Rate and the number of shares of Designated Preferred
Stock selected for conversion; provided, however, notwithstanding anything in this Certificate of
Designations to the contrary, holders of Designated Preferred Stock shall not be entitled to
convert shares of Designated Preferred Stock until the converting holder has first received any
applicable Regulatory Approvals. In addition to the number of Shares issuable upon Early
Conversion, the holders of shares of Designated Preferred Stock subject to Early Conversion shall
have the right to receive (in cash or shares of Common Stock at the option of the Corporation in
accordance with Section 6(e)) any accrued and unpaid dividends on such shares to, but excluding,
the Early Conversion Date (including, if applicable, as provided in Section 3(a) above, dividends
on such amount), regardless of whether any dividends are actually declared.

(b) Conditions to Early Conversion. The Corporation’s right of conversion set forth
in Section 7(a) is subject to the fulfillment (or waiver by the Original Designated Preferred
Stockholder with respect to items (ii), (iii), (iv), (v) and (vi) below) at or prior to the Early
Conversion Date of each of the following conditions:

(i) the Corporation shall have requested and received from the Appropriate Federal
Banking Agency all requisite approvals of the Early Conversion;

(ii) the stockholders of the Corporation will have approved an amendment to the
Corporation’s Charter increasing the number of shares the Corporation is authorized to issue
to at least 1,200,000,000 shares and changing the par value of the Common Stock to $0.10 per
share;

(iii) at least $385 million in aggregate liquidation value of the Corporation’s 7.125%
Noncumulative Perpetual Monthly Income Preferred Stock, Series A, 8.35% Noncumulative
Perpetual Monthly Income Preferred Stock, Series B, 7.40% Noncumulative Perpetual Monthly
Income Preferred Stock, Series C, 7.25% Noncumulative Perpetual Monthly Income Preferred
Stock, Series D, and 7.00% Noncumulative Perpetual Monthly Income Preferred Stock, Series E
(collectively, the “Other Preferred Stock”) shall have been exchanged for shares of
Common Stock (each, an “Other Preferred Stock Exchange”); provided, however, that
the terms of each Other Preferred Stock Exchange shall, except as approved by the Original
Designated Preferred Shareholder in its sole discretion, not involve the issuance of more
than 11.6822 shares of Common Stock for each share of Other Preferred Stock, and shall
otherwise be acceptable to the Original Designated Preferred Shareholder in its sole
discretion;

(iv) the Corporation shall have closed one or more transactions in which investors
other than the Original Designated Preferred Stockholder (each, an “Equity
Investor”) have collectively provided a minimum aggregate amount of $500 million in
gross cash proceeds to the Corporation in exchange for Common Stock (each such investment by
an Equity Investor, an “Equity Raise”); provided, however, that the terms of each
such Equity Raise (other than the price per share of Common Stock issued by the Corporation
in each such Equity Raise) shall be reasonably acceptable to the Original Designated
Preferred Shareholder in its sole discretion;

(v) the Corporation shall have made all applicable adjustments pursuant to Section 11
that are required to be made on or before the Early Conversion Date; and

(vi) none of the following shall have occurred with respect to the Corporation or any
of its subsidiaries:

(A) the Corporation or any of its subsidiaries shall have (1) dissolved (other
than pursuant to a consolidation, amalgamation or merger); (2) become insolvent or
unable to pay its debts or failed or admitted in writing its inability generally to
pay its debts as they become due; (3) made a general assignment, arrangement or
composition with or for the benefit of its creditors; (4) instituted or have
instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or
any other relief under any bankruptcy or insolvency law or other similar law
affecting creditors’ rights, or a petition shall have been presented for its
winding-up or liquidation, and, in the case of any such proceeding or petition
instituted or presented against it, such proceeding or petition shall have resulted
in a judgment of insolvency or bankruptcy or the entry of an order for relief or the
making of an order for its winding-up or liquidation; (5) had a resolution passed
for its winding-up, official management or liquidation (other than pursuant to a
consolidation, amalgamation or merger); (6) sought or shall have become subject to
the appointment of an administrator, provisional liquidator, conservator, receiver,
trustee, custodian or other similar official for it or for all or substantially all
its assets; (7) had a secured party take possession of all or substantially all its
assets or had a distress, execution, attachment, sequestration or other legal
process levied, enforced or sued on or against all or substantially all its assets;
(8) caused or shall have been subject to any event with respect to it which, under
the applicable laws of any jurisdiction, had an analogous effect to any of the
events specified in clauses (1) to (7) (inclusive); or (9) taken any action in
furtherance of, or indicating its consent to, approval of, or acquiescence in, any
of the foregoing acts;

(B) a Governmental Entity in any jurisdiction shall have (1) commenced an
action or proceeding against the Corporation or any of its subsidiaries; or (2)
issued or entered a temporary restraining order, preliminary or permanent injunction
or other order applicable to the Corporation or any of its subsidiaries, which in
the case of (1) and (2) shall have had or shall be reasonably expected to have a
Company Material Adverse Effect;

(C) no fact, circumstance, event, change, occurrence, condition or development
shall have occurred that, individually or in the aggregate, shall have had or shall
be reasonably likely to have a Company Material Adverse Effect; or

(D) any Regulatory Event not otherwise existing on the date hereof.

(c) Early Conversion Procedures. In the event of an Early Conversion, the Corporation
shall provide notice of such conversion to each holder of Designated Preferred Stock to be
converted (such notice, a “Notice of Early Conversion”). Such Notice of Early Conversion
shall be mailed at least 3 days and not more than 60 days before the date fixed for conversion (the
"Early Conversion Date”). The requirement to deliver a Notice of Early Conversion and the
timing requirements for such delivery may be waived by each holder of Designated Preferred Stock in
its sole discretion. Each Notice of Early Conversion given to a holder shall state:

(i) the Early Conversion Date;

(ii) the number of shares of Designated Preferred Stock to be converted and, if less
than all the shares held by such holder are to be converted, the number of such shares to be
converted from such holder;

(iii) the Conversion Rate then in effect and whether the Corporation will pay cash or
issue shares of Common Stock (calculated in accordance with Section 6(e) above) in respect
of accrued and unpaid dividends; and

(iv) the place or places where certificates for shares of Designated Preferred Stock
are to be surrendered for issuance of certificates representing Shares.

(d) Partial Conversion. If the Corporation elects to cause less than all the shares
of the Designated Preferred Stock to be converted under this Section 7, the shares of Designated
Preferred Stock to be converted shall be selected either pro rata or in such other manner as the
Board of Directors or a duly authorized committee thereof may determine to be fair and equitable.
Subject to the provisions hereof, the Board of Directors or a duly authorized committee thereof
shall have full power and authority to prescribe the terms and conditions upon which shares of
Designated Preferred Stock shall be converted from time to time pursuant to an Early Conversion.

Section 8. Mandatory Conversion.

(a) Mandatory Conversion. Each share of Designated Preferred Stock shall mandatorily
convert (unless otherwise previously converted, redeemed or otherwise reacquired by the Company) on
the Mandatory Conversion Date into a number of Shares determined by dividing the Liquidation Amount
by the Market Price on the second Trading Day preceding the Mandatory Conversion Date; provided,
however, notwithstanding anything in this Certificate of Designations to the contrary, holders of
Designated Preferred Stock shall not be entitled to convert shares of Designated Preferred Stock
until the converting holder has first received any applicable Regulatory Approvals. In addition to
the number of Shares issuable upon mandatory conversion, the holders of the shares of Designated
Preferred Stock subject to mandatory conversion shall have the right to receive any accrued and
unpaid dividends on such shares to, but excluding, the Mandatory Conversion Date (including, if
applicable, as provided in Section 3(a) above, dividends on such amount), regardless of whether any
dividends are actually declared.

(b) Mandatory Conversion Procedures. In the event of a mandatory conversion, the
Corporation shall provide notice thereof to each holder of Designated Preferred Stock to be
converted (such notice, a “Notice of Mandatory Conversion”). Such Notice of Mandatory
Conversion shall be mailed at least 30 days and not more than 60 days before the Mandatory
Conversion Date. Each Notice of Mandatory Conversion given to a holder shall state:

(i) the Mandatory Conversion Date;

(ii) that all outstanding shares of Designated Preferred Stock shall be converted on
such date;

(iii) the Conversion Rate then in effect and whether the Corporation will pay cash or
issue shares of Common Stock (calculated in accordance with Section 6(e) above) in respect
of accrued and unpaid dividends; and

(iv) the place or places where certificates for shares of Designated Preferred Stock
are to be surrendered for issuance of certificates representing Shares.

Section 9. Conversion upon a Specified Corporate Transaction.

(a) In addition to the right of a holder of Designated Preferred Stock, at such holder’s
option, to convert, at any time and from time to time, all or any portion of the Designated
Preferred Stock as set forth in Section 6, a holder of Designated Preferred Stock shall have the
right, at such holder’s option, to convert all or any portion of such holder’s Designated Preferred
Stock into a number of Shares equal to the product of the then-applicable Conversion Rate and the
number of shares of Designated Preferred Stock surrendered for conversion upon the following events
(each a “Specified Corporate Transaction”):

(i) if the Corporation makes a Special Distribution to all or substantially all holders
of Common Stock, at any time after the Corporation has given the notice of such distribution
as provided in Section 9(b) below until the earlier of 5:00 p.m., New York City time, on the
Business Day preceding the Ex-Dividend Date for such distribution or any announcement by the
Corporation that such distribution shall not take place;

(ii) if the Corporation adopts a plan relating to the liquidation or dissolution of the
Corporation, at any time beginning on the Business Day following the date notice of the
Specified Corporate Transaction is given as provided in Section 9(b) below and ending on the
date that is 30 calendar days after such date; or

(iii) if the Corporation consolidates or merges with or into any other Person, or
sells, leases, transfers, conveys or otherwise disposes, in one or a series of related
transactions, all or substantially all of its assets and those of its subsidiaries taken as
a whole to any Person that results in any reclassification, conversion, exchange or
cancellation of outstanding shares of the Capital Stock of the Corporation, other than any
merger solely for the purpose of changing the Corporation’s jurisdiction of incorporation
and resulting in a reclassification, conversion or exchange of outstanding Shares solely
into shares of common stock of the surviving entity, at any time beginning 15 days prior to
the date announced by the Corporation as the anticipated effective date of the transaction
and until and including the date which is 15 days after the date that is the actual
effective date of such transaction;

provided, however, notwithstanding anything in this Certificate of Designations to the contrary,
holders of Designated Preferred Stock shall not be entitled to convert shares of Designated
Preferred Stock until the converting holder has first received any applicable Regulatory Approvals.
In addition to the number of Shares issuable upon conversion in connection with a Specified
Corporate Transaction, the holders of shares of Designated Preferred Stock so converted shall have
the right to receive any accrued and unpaid dividends on such shares to, but excluding, the
Conversion Date (including, if applicable, as provided in Section 3(a) above, dividends on such
amount), regardless of whether any dividends are actually declared.

(b) Specified Corporate Transaction Conversion Procedures. In the event of a
Specified Corporate Transaction, the Corporation shall provide notice thereof to each holder of
Designated Preferred Stock. In the case of a Specified Corporate Transaction contemplated by
Section 9(a)(i), such notice shall be mailed at least 30 days prior to the Ex-Dividend Date for
such distribution. In the case of a Specified Corporate Transaction contemplated by
Section 9(a)(ii), such notice shall be mailed no later than 5 days after the adoption of the plan
of liquidation or dissolution. In the case of a Specified Corporate Transaction contemplated by
Section 9(a)(iii), such notice shall be mailed at least 20 days prior to the beginning of the
conversion period related to such Specified Corporate Transaction. Each such notice given to a
holder shall state, as applicable:

(i) a description of the Specified Corporate Transaction, including a description of
the type and amount of the distribution to be made or consideration to be received per share
of Common Stock;

(ii) the Ex-Dividend Date in the case of a Specified Corporate Transaction contemplated
by Section 9(a)(i), the date of adoption of the plan in the case of a Specified Corporate
Transaction contemplated by Section 9(a)(ii) or the date on which the Specified Corporate
Transaction is anticipated to be effective in the case of a Specified Corporate Transaction
contemplated by Section 9(a)(iii);

(iii) the date by which the Specified Corporate Transaction conversion option must be
exercised by a holder of Designated Preferred Stock;

(iv) the Conversion Rate then in effect and whether the Corporation will pay cash or
issue shares of Common Stock (calculated in accordance with Section 6(e) above) in respect
of accrued and unpaid dividends; and

(v) the place or places where certificates for shares of Designated Preferred Stock are
to be surrendered for issuance of certificates representing Shares.

(c) To exercise a Specified Corporate Transaction conversion option, a holder of the
Designated Preferred Stock must, no later than 5:00 p.m., New York City time, on the date by which
the conversion option upon the Specified Corporate Transaction must be exercised as specified in
the Notice of Specified Corporate Transaction delivered under Section 9(b), comply with the
procedures set forth in Section 6(h) and indicate that it is exercising its conversion option
pursuant to this Section 9.

(d) If a holder of the Designated Preferred Stock does not elect to exercise its conversion
option pursuant to this Section 9, the shares of Designated Preferred Stock or successor securities
held by it shall remain outstanding but the holder of the Designated Preferred Stock shall not
thereafter be entitled to convert such holder shares of the Designated Preferred Stock in
accordance with this Section 9.

Section 10. Conversion upon Change of Control.

(a) Change of Control. In addition to the right of a holder of Designated Preferred
Stock, at such holder’s option, to convert, at any time and from time to time, all or any portion
of the Designated Preferred Stock as set forth in Section 6, a holder of Designated Preferred Stock
shall have the right, at such holder’s option, to convert all or any portion of such holder’s
Designated Preferred Stock into a number of Shares equal to the product of the then-applicable
Conversion Rate and the number of shares of Designated Preferred Stock surrendered for conversion
during the period beginning on the Business Day following the effective date of the Change of
Control (the “Change of Control Effective Date”) and ending on the date that is 30 calendar
days after the Change of Control Effective Date; provided, however, notwithstanding anything in
this Certificate of Designations to the contrary, holders of Designated Preferred Stock shall not
be entitled to convert shares of Designated Preferred Stock until the converting holder has first
received any applicable Regulatory Approvals. In addition to the number of Shares issuable upon
conversion upon a Change of Control, the holders of shares of Designated Preferred Stock so
converted shall have the right to receive any accrued and unpaid dividends on such shares to, but
excluding, the Conversion Date (including, if applicable, as provided in Section 3(a) above,
dividends on such amount), regardless of whether any dividends are actually declared.

(b) Change of Control Conversion Procedures. In the event of a Change of Control, the
Corporation shall provide notice thereof to each holder of Designated Preferred Stock. Such notice
shall be mailed at least 20 days prior to the date on which the Corporation anticipates
consummating the Change of Control (or, if later, within two Business Days after the Corporation
becomes aware of a Change of Control). Each such notice given to a holder shall state:

(i) a description of the Change of Control;

(ii) the date on which the Change of Control is anticipated to be effected or, if
known, the Change of Control Effective Date;

(iii) the date by which the Change of Control conversion option must be exercised,
which shall be 30 calendar days after the Change of Control Effective Date;

(iv) the Conversion Rate then in effect and whether the Corporation will pay cash or
issue shares of Common Stock (calculated in accordance with Section 6(e) above) in respect
of accrued and unpaid dividends; and

(v) the place or places where certificates for shares of Designated Preferred Stock are
to be surrendered for issuance of certificates representing Shares.

(c) To exercise a Change of Control conversion option, a holder of the Designated Preferred
Stock must, no later than 5:00 p.m., New York City time, on the date by which the conversion option
upon the Change of Control must be exercised as specified in the notice delivered under
Section 10(b), comply with the procedures set forth in Section 6(h) and indicate that it is
exercising its conversion option pursuant to this Section 10.

(d) If a holder of the Designated Preferred Stock does not elect to exercise its conversion
option pursuant to this Section 10, the shares of Designated Preferred Stock or successor
securities held by it shall remain outstanding but the holder of the Designated Preferred Stock
shall not thereafter be entitled to convert such holder’s shares of the Designated Convertible
Preferred Stock in accordance with this Section 10.

Section 11. Anti-Dilution Adjustments. The Conversion Price and the Conversion Rate
shall be subject to adjustment from time to time as follows; provided, that if more than one
Subsection of this Section 11 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 11 so as to result in duplication:

(a) Stock Splits, Subdivisions, Reclassifications or Combinations. If the Corporation
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 of Common Stock, or (iii) combine or reclassify the outstanding shares of Common Stock into
a smaller number of shares of Common Stock, the Conversion 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 multiplying the
Conversion 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 a fraction (x) the numerator of which shall be the number of shares of Common Stock
outstanding at the time of the record date for such dividend or distribution or the effective date
of such subdivision, combination or reclassification, in each case, prior to giving effect to such
event, and (y) the denominator of which shall be the number of shares of Common Stock outstanding
immediately after, and solely as a result of, such event.

(b) Issuance of Common Stock upon Other Preferred Stock Exchange.

(i) Until the date on which the Original Designated Preferred Stockholder no longer
holds the Designated Preferred Stock or any portion thereof, (A) if (1) Other Preferred
Stock shall have been exchanged for Common Stock pursuant to an Other Preferred Stock
Exchange and (2) the value of the Other Preferred Stock for purposes of the Other Preferred
Stock Exchange (which shall equal the Market Price per share of Common Stock as of the
Signing Date multiplied by the aggregate number of shares of Common Stock for which the
Other Preferred Stock is exchanged) shall have exceeded 49% of the liquidation preference of
such Other Preferred Stock, then the consideration per share of Common Stock received by the
Corporation in such Other Preferred Stock Exchange for purposes of Section 11(b)(ii) below
shall be deemed to equal the number obtained by dividing (i) the amount equal to 49% of the
liquidation preference of such Other Preferred Stock by (ii) the number of shares of Common
Stock issued by the Corporation in connection with the Other Preferred Stock Exchange.

(ii) In the event that, after taking into account the adjustments required pursuant to
Section 11(b)(i) above, the Other Preferred Stock shall have been exchanged for shares of
Common Stock at a consideration per share of Common Stock that is less than the Conversion
Price in effect immediately prior to the Other Preferred Stock Exchange, then the Conversion
Price shall be decreased to the number obtained by multiplying the Conversion Price in
effect immediately before the Other Preferred Exchange by a fraction (1) the numerator of
which shall be the sum of (i) the number of shares of Common Stock of the Corporation
outstanding immediately prior to the Other Preferred Stock Exchange and (ii) the number of
additional shares of Common Stock which the aggregate consideration deemed to be received by
the Corporation for the Common Stock issued in the Other Preferred Stock Exchange would
purchase at the Conversion Price in effect immediately prior to the Other Preferred Stock
Exchange, and (2) the denominator of which shall be the sum of (i) the number of shares of
Common Stock outstanding immediately prior to the Other Preferred Stock Exchange and (ii)
the number of shares of Common Stock issued by the Corporation in connection with the Other
Preferred Stock Exchange.

(iii) Any adjustment made pursuant to this Section 11(b) shall become effective
immediately upon acceptance by the Corporation of the shares that are tendered in the Other
Preferred Stock Exchange.

(c) Issuances of Common Stock upon an Equity Raise. Until the date on which the
Original Designated Preferred Stockholder no longer holds the Designated Preferred Stock or any
portion thereof, if the Corporation shall issue or agree to issue shares of Common Stock (or rights
or warrants or other securities exercisable or convertible into or exchangeable for shares of
Common Stock) (collectively, “Convertible Securities”)) to an Equity Investor pursuant to
an Equity Raise (an “Equity Raise Issuance”) without consideration or at a consideration
per share of Common Stock (or having a conversion price per share of Common Stock) that is less
than 90% of the Market Price per share of Common Stock on the Trading Day immediately preceding the
pricing of the Equity Raise offering, then the Conversion Price in effect immediately prior to the
Equity Raise Issuance shall be decreased to the number obtained by multiplying such Conversion
Price by a fraction (A) the numerator of which shall be the sum of (1) the number of shares of
Common Stock of the Corporation outstanding immediately prior to the Equity Raise Issuance and
(2) the number of additional shares of Common Stock which the aggregate consideration receivable by
the Corporation for the total number of shares of Common Stock issued (or into which Convertible
Securities may be exercised or converted) in connection with the Equity Raise Issuance would
purchase at a consideration per share of 90% of the Market Price per share of Common Stock on the
Trading Day immediately preceding the pricing of the Equity Raise offering, and (B) the denominator
of which shall be the sum of (1) the number of shares of Common Stock outstanding immediately prior
to the Equity Raise Issuance and (2) the number of shares of Common Stock issued (or into which
Convertible Securities may be exercised or converted) to the Equity Investor in connection with the
Equity Raise Issuance.

For purposes of the foregoing, the aggregate consideration receivable by the Corporation in
connection with an Equity Raise Issuance 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 Common Stock plus the minimum aggregate amount,
if any, payable upon exercise or conversion of any such Convertible Securities into shares of
Common Stock. Any adjustment made pursuant to this Section 11(c) shall become effective
immediately upon the date of the applicable Equity Raise Issuance.

(d) Other Issuances of Common Stock. Until the date on which the Original Designated
Preferred Stockholder no longer holds the Designated Preferred Stock or any portion thereof, if the
Corporation shall issue shares of Common Stock or Convertible Securities other than pursuant to a
Permitted Transaction (as defined below) or a transaction for which Sections 11(a), 11(b) or 11(c)
apply (a “Common Stock Issuance”) without consideration or at a consideration per share (or
having a conversion price per share) that is less than the Conversion Price in effect immediately
prior to such Common Stock Issuance, then the Conversion Price in effect immediately prior to the
Common Stock Issuance shall be decreased to the number obtained by multiplying such Conversion
Price by a fraction (A) the numerator of which shall be the sum of (1) the number of shares of
Common Stock of the Corporation outstanding immediately prior to the Common Stock Issuance and
(2) the number of additional shares of Common Stock which the aggregate consideration receivable by
the Corporation for the total number of shares of Common Stock issued (or into which Convertible
Securities may be exercised or converted) in connection with the Common Stock Issuance would
purchase at the Conversion Price in effect immediately prior to such Common Stock Issuance and
(B) the denominator of which shall be the sum of (1) the number of shares of Common Stock
outstanding immediately prior to the Common Stock Issuance and (2) the number of shares of Common
Stock issued (or into which Convertible Securities may be exercised or converted) in connection
with the Common Stock Issuance.

For purposes of the foregoing, the aggregate consideration receivable by the Corporation in
connection with a Common Stock Issuance 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 at Fair Market Value, (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 Corporation 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 Original Issue Date. Any adjustment made pursuant to this Section 11(d) shall
become effective immediately upon the date of such issuance. For the avoidance of doubt,
notwithstanding any other provision hereof, Section 11(d) shall not apply to any transaction to
which Section 11(a), 11(b) or 11(c) applies.

(e) Other Distributions. In case the Corporation shall fix a record date for the
making of a distribution to all holders of its shares of Common Stock, 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 11(a)), in each such case, the
Conversion Price in effect prior to such record date shall be reduced immediately thereafter to the
price determined by multiplying the Conversion 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 in a regular way (including 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, cash, rights or warrants to be so distributed in
respect of one share of Common Stock (such amount and/or Fair Market Value, the “Per Share Fair
Market Value”) divided by (y) such Market Price on such date specified in clause (x); such
adjustment shall be made successively whenever such a record date is fixed. In 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 Conversion Price then in effect shall be readjusted, effective as of the date when
the Board of Directors determines not to distribute such securities, evidences of indebtedness,
assets, rights, cash or warrants, as the case may be, to the Conversion Price that would then be in
effect and the Conversion Rate if such record date had not been fixed.

(f) Certain Repurchases of Common Stock. In case the Corporation effects a Pro Rata
Repurchase of Common Stock, then the Conversion Price shall be reduced to the price determined by
multiplying the Conversion 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 Corporation 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 Corporation or any of its Affiliates of the intent
to effect such Pro Rata Repurchase. For the avoidance of doubt, no increase to the Conversion
Price shall be made pursuant to this Section 11(f).

(g) Business Combinations. In case of any Business Combination or reclassification of
Common Stock (other than a reclassification of Common Stock referred to in Section 11(a)), the
right of a holder of Designated Preferred Stock to receive Shares upon conversion of the Designated
Preferred Stock into Shares shall be converted into the right to convert the Designated Preferred
Stock to acquire the number of shares of stock or other securities or property (including cash)
which the Shares issuable (at the time of such Business Combination or reclassification) upon
conversion of the Designated Preferred Stock 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 a holder of Designated Preferred Stock shall be
appropriately adjusted so as to be applicable, as nearly as may reasonably be, to the right of a
holder of Designated Preferred Stock to convert the Designated Preferred Stock 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 conversion of the Designated
Preferred Stock 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 a holder of Designated Preferred Stock 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).

(h) Rounding of Calculations; Minimum Adjustments. All calculations under this
Section 11 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 11 to the
contrary notwithstanding, no adjustment in the Conversion Price or the Conversion Rate 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.

(i) Timing of Issuance of Additional Common Stock upon Certain Adjustments. In any
case in which the provisions of this Section 11 shall require that an adjustment shall become
effective immediately after a record date for an event, the Corporation may defer until the
occurrence of such event (i) issuing to the holder of Designated Preferred Stock converted after
such record date and before the occurrence of such event the additional shares of Common Stock
issuable upon such conversion by reason of the adjustment required by such event over and above the
Shares issuable upon such conversion before giving effect to such adjustment and (ii) paying to
such holder of Designated Preferred Stock any amount of cash in lieu of a fractional share of
Common Stock; provided, however, that the Corporation upon request shall deliver to such holder of
Designated Preferred Stock a due bill or other appropriate instrument evidencing the right of such
holder of Designated Preferred Stock to receive such additional shares, and such cash, upon the
occurrence of the event requiring such adjustment.

(j) Other Events. For so long as the Original Designated Preferred Stockholder holds
the Designated Preferred Stock or any portion thereof, if any event occurs as to which the
provisions of this Section 11 are not strictly applicable or, if strictly applicable, would not, in
the good faith judgment of the Board of Directors of the Corporation, fairly and adequately protect
the conversion rights of the Designated Preferred Stock 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
conversion rights as aforesaid. The Conversion Price or the Conversion Rate 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 Corporation.

(k) Statement Regarding Adjustments. Whenever the Conversion Price or the Conversion
Rate shall be adjusted as provided in this Section 11, the Corporation shall forthwith file at the
principal office of the Corporation a statement showing in reasonable detail the facts requiring
such adjustment and the Conversion Price that shall be in effect and the Conversion Rate after such
adjustment, and the Corporation shall also cause a copy of such statement to be sent by mail, first
class postage prepaid, to each holder of Designated Preferred Stock at the address appearing in the
Corporation’s records.

(l) Notice of Adjustment Event. In the event that the Corporation shall propose to
take any action of the type described in this Section 11 (but only if the action of the type
described in this Section 11 would result in an adjustment in the Conversion Price or the
Conversion Rate or a change in the type of securities or property to be delivered upon conversion
of the Designated Preferred Stock), the Corporation shall give notice to each holder of Designated
Preferred Stock, in the manner set forth in Section 11(k), 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 Conversion Price, Conversion Rate and the number, kind or
class of shares or other securities or property which shall be deliverable upon conversion of the
Designated Preferred Stock. 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.

(m) 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 11, the
Corporation shall take any action which may be necessary, including obtaining regulatory, NYSE,
NASDAQ or other applicable national securities exchange or stockholder approvals or exemptions, in
order that the Corporation may thereafter validly and legally issue as fully paid and nonassessable
all Shares that the holders of Designated Preferred Stock are entitled to receive upon conversion
of the Designated Preferred Stock pursuant to this Section 11.

(n) Adjustment Rules. Any adjustments pursuant to this Section 11 shall be made
successively whenever an event referred to herein shall occur.

Section 12. Reservation and Listing of Common Stock. The Corporation hereby covenants
that any Shares issued upon the conversion of the Designated Preferred Stock in accordance with
this Certificate of Designations shall 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 a
holder of Designated Preferred Stock, income and franchise taxes incurred in connection with the
conversion of the Designated Preferred Stock or taxes in respect of any transfer occurring
contemporaneously therewith). The Corporation shall at all times reserve and keep available, out
of its authorized but unissued Common Stock, solely for the purpose of providing for the conversion
of the Designated Preferred Stock, the aggregate number of shares of Common Stock then issuable
upon conversion of the Designated Preferred Stock at any time. The Corporation shall (A) procure,
at its sole expense, the listing of the Shares issuable upon conversion of the Designated Preferred
Stock 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 Corporation shall 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.

Section 13. Voting Rights.

(a) General. The holders of Designated Preferred Stock shall not have any voting
rights except as set forth below or as otherwise from time to time required by law.

(b) Preferred Stock Directors. Whenever, at any time or times, dividends payable on
the shares of Designated Preferred Stock have not been paid for an aggregate of six quarterly
Dividend Periods or more, whether or not consecutive, the authorized number of directors of the
Corporation shall automatically be increased by two and the holders of the Designated Preferred
Stock shall have the right, with holders of shares of any one or more other classes or series of
Voting Parity Stock outstanding at the time, voting together as a class, to elect two directors
(hereinafter the “Preferred Directors” and each a “Preferred Director”) to fill
such newly created directorships at the Corporation’s next annual meeting of stockholders (or at a
special meeting called for that purpose prior to such next annual meeting) and at each subsequent
annual meeting of stockholders until all accrued and unpaid dividends for all past Dividend
Periods, including the latest completed Dividend Period (including, if applicable as provided in
Section 3(a) above, dividends on such amount), on all outstanding shares of Designated Preferred
Stock have been declared and paid in full at which time such right shall terminate with respect to
the Designated Preferred Stock, except as herein or by law expressly provided, subject to revesting
in the event of each and every subsequent default of the character above mentioned; provided that
it shall be a qualification for election for any Preferred Director that the election of such
Preferred Director shall not cause the Corporation to violate any corporate governance requirements
of any securities exchange or other trading facility on which securities of the Corporation may
then be listed or traded that listed or traded companies must have a majority of independent
directors. Upon any termination of the right of the holders of shares of Designated Preferred
Stock and Voting Parity Stock as a class to vote for directors as provided above, the Preferred
Directors shall cease to be qualified as directors, the term of office of all Preferred Directors
then in office shall terminate immediately and the authorized number of directors shall be reduced
by the number of Preferred Directors elected pursuant hereto. Any Preferred Director may be
removed at any time, with or without cause, and any vacancy created thereby may be filled, only by
the affirmative vote of the holders a majority of the shares of Designated Preferred Stock at the
time outstanding voting separately as a class together with the holders of shares of Voting Parity
Stock, to the extent the voting rights of such holders described above are then exercisable. If
the office of any Preferred Director becomes vacant for any reason other than removal from office
as aforesaid, the remaining Preferred Director may choose a successor who shall hold office for the
unexpired term in respect of which such vacancy occurred.

(c) Class Voting Rights as to Particular Matters. So long as any shares of Designated
Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required
by law or by the Charter, the vote or consent of the holders of at least 66 2/3% of the shares of
Designated Preferred Stock at the time outstanding, voting as a separate class, given in person or
by proxy, either in writing without a meeting or by vote at any meeting called for the purpose,
shall be necessary for effecting or validating:

(i) Authorization of Senior Stock. Any amendment or alteration of the
Certificate of Designations for the Designated Preferred Stock or the Charter to authorize
or create or increase the authorized amount of, or any issuance of, any shares of, or any
securities convertible into or exchangeable or exercisable for shares of, any class or
series of Capital Stock of the Corporation ranking senior to Designated Preferred Stock with
respect to either or both the payment of dividends and/or the distribution of assets on any
liquidation, dissolution or winding up of the Corporation;

(ii) Amendment of Designated Preferred Stock. Any amendment, alteration or
repeal of any provision of the Certificate of Designations for the Designated Preferred
Stock or the Charter (including, unless no vote on such merger or consolidation is required
by Section 13(c)(iii) below, any amendment, alteration or repeal by means of a merger,
consolidation or otherwise) so as to adversely affect the rights, preferences, privileges or
voting powers of the Designated Preferred Stock; or

(iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any
consummation of a binding share exchange or reclassification involving the Designated
Preferred Stock, or of a merger or consolidation of the Corporation with another corporation
or other entity, unless in each case (x) the shares of Designated Preferred Stock remain
outstanding or, in the case of any such merger or consolidation with respect to which the
Corporation is not the surviving or resulting entity, are converted into or exchanged for
preference securities of the surviving or resulting entity or its ultimate parent, and
(y) such shares remaining outstanding or such preference securities, as the case may be,
have such rights, preferences, privileges and voting powers, and limitations and
restrictions thereof, taken as a whole, as are not materially less favorable to the holders
thereof than the rights, preferences, privileges and voting powers, and limitations and
restrictions thereof, of Designated Preferred Stock immediately prior to such consummation,
taken as a whole;

provided, however, that for all purposes of this Section 13(c), any increase in the amount of the
authorized Preferred Stock, including any increase in the authorized amount of Designated Preferred
Stock necessary to satisfy preemptive or similar rights granted by the Corporation to other persons
prior to the Signing Date, or the creation and issuance, or an increase in the authorized or issued
amount, whether pursuant to preemptive or similar rights or otherwise, of any other series of
Preferred Stock, or any securities convertible into or exchangeable or exercisable for any other
series of Preferred Stock, ranking equally with and/or junior to Designated Preferred Stock with
respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and
the distribution of assets upon liquidation, dissolution or winding up of the Corporation shall not
be deemed to adversely affect the rights, preferences, privileges or voting powers, and shall not
require the affirmative vote or consent of, the holders of outstanding shares of the Designated
Preferred Stock.

(d) Changes after Provision for Redemption or Conversion. No vote or consent of the
holders of Designated Preferred Stock shall be required pursuant to Section 13(c) above if, at or
prior to the time when any such vote or consent would otherwise be required pursuant to such
Section, all outstanding shares of the Designated Preferred Stock shall have been redeemed, or
shall have been called for redemption upon proper notice and sufficient funds shall have been
deposited in trust for such redemption, in each case pursuant to Section 5 above or shall have been
converted and sufficient Shares shall have been delivered, in each case, pursuant to Sections 6, 7,
8, 9 or 10 above.

(e) Procedures for Voting and Consents. The rules and procedures for calling and
conducting any meeting of the holders of Designated Preferred Stock (including, without limitation,
the fixing of a record date in connection therewith), the solicitation and use of proxies at such a
meeting, the obtaining of written consents and any other aspect or matter with regard to such a
meeting or such consents shall be governed by any rules of the Board of Directors or any duly
authorized committee of the Board of Directors, in its discretion, may adopt from time to time,
which rules and procedures shall conform to the requirements of the Charter, the Bylaws, and
applicable law and the rules of any national securities exchange or other trading facility on which
Designated Preferred Stock is listed or traded at the time.

Section 14. Record Holders. To the fullest extent permitted by applicable law, the
Corporation, the transfer agent, registrar, dividend disbursing agent and conversion agent may deem
and treat the record holder of any share of Designated Preferred Stock as the true and lawful owner
thereof for all purposes, and neither the Corporation nor such transfer agent, registrar, dividend
disbursing agent or conversion agent shall be affected by any notice to the contrary.

Section 15. Prohibited Actions. The Corporation agrees that it shall not take any
action which would entitle holder(s) of Designated Preferred Stock to an adjustment of the
Conversion Price if the total number of shares of Common Stock issuable after such action upon
conversion of the Designated Preferred Stock, 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.

Section 16. Notices. All notices or communications in respect of Designated Preferred
Stock shall be sufficiently given if given in writing and delivered in person or by first class
mail, postage prepaid, or if given in such other manner as may be permitted in this Certificate of
Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if
shares of Designated Preferred Stock are issued in book-entry form through the Depositary or any
similar facility, such notices may be given to the holders of Designated Preferred Stock in any
manner permitted by such facility.

Section 17. No Preemptive Rights. No share of Designated Preferred Stock shall have
any rights of preemption whatsoever as to any securities of the Corporation, or any warrants,
rights or options issued or granted with respect thereto, regardless of how such securities, or
such warrants, rights or options, may be designated, issued or granted.

Section 18. Replacement Certificates. The Corporation shall replace any mutilated
certificate at the holder’s expense upon surrender of that certificate to the Corporation. The
Corporation shall replace certificates that become destroyed, stolen or lost at the holder’s
expense upon delivery to the Corporation of reasonably satisfactory evidence that the certificate
has been destroyed, stolen or lost, together with any indemnity that may be reasonably required by
the Corporation.

Section 19. Other Rights. The shares of Designated Preferred Stock shall not have any
rights, preferences, privileges or voting powers or relative, participating, optional or other
special rights, or qualifications, limitations or restrictions thereof, other than as set forth
herein or in the Charter or as provided by applicable law.ex-10_1.htm

Yasheng Eco-Trade Corporation 8-K

 

 

Exhibit 10.1

 

 

JOINT VENTURE AGREEMENT

Agreement dated as of June 30, 2010 between Yasheng Eco-Trade Corporation, a Delaware corporation ("YASHENG"), and CMARK International, Inc. a South Carolina corporation ("CMARK").

WHEREAS, CMARK provides a wide array of services and products in the areas of construction, interior systems, and hospitality operations primarily to the U.S. Federal government and U.S. Federal government prime contractors;

WHEREAS, CMARK currently has a backlog of work as more fully described on Schedule A (the “Backlog”);

WHEREAS, YASHENG is in the process of developing a logistics center in Southern California and is registered as a vendor by the United States government as more fully described on Schedule B;

WHEREAS, YASHENG and CMARK desire to create a jointly owned company that will assist CMARK in implementing and executing the Backlog

All of the foregoing is to be upon the terms and subject to the conditions set forth in this Agreement.

The parties therefore agree as follows:

1.           Creation of the New Company

Immediately following the execution of this Agreement, YASHENG and CMARK shall cause to be organized, under the laws of NEVADA or such other state as the parties may agree, a corporation to be named "CMARK TRADE CORP" or such other name upon which the parties may agree ("NEWCORP").  The charter documents and by-laws of NEWCORP shall be consistent with the provisions of this Agreement.  Promptly after the creation of NEWCORP, YASHENG and CMARK shall cause NEWCORP to execute and deliver to such parties a letter in which NEWCORP agrees to be bound by the terms and conditions of this Agreement with the same force and effect as if NEWCORP were an original party hereto.

2.           Issuance of Capital Stock

The authorized capital of NEWCORP shall consist of 100,000 shares of Common Stock, par value $0.0001 per share ("Shares"). Upon the creation of NEWCORP, YASHENG shall subscribe for 50 Shares at an aggregate purchase price of $1.000 ($20 per Share), and CMARK shall subscribe for 50 Shares at an aggregate purchase price of $1,000 ($20 per Share).

3.           Operations

NEWCORP shall assist CMARK in the implementation and servicing of the Backlog and NEWCORP shall not engage in any other business without the prior consent of the parties hereto.

4.           Board of Directors; Management

So long as each of the Shareholders and its Affiliates continue to own a number of outstanding Shares that is equal to the number of Shares owned by the other Shareholder and its Affiliates, NEWCORP shall have a Board consisting of two members, one of whom (initially William Lieberman) shall be designated by YASHENG, and one of whom (initially Charles W. Jones) shall be designated by CMARK.  If any designee of a party ceases to serve as a member of the Board, whether as a result of such member's removal or resignation or otherwise, the party which designated such member shall designate a new director in his place.  Charles W. Jones shall be appointed as Chief Executive Officer of Newco and William Lieberman shall be appointed as President and Chief Financial Officer.

  

  

  

 

5.           Restrictions on Transfer of Shares

5.1  Restrictions on Transfer.  Neither party hereto may transfer any or all of its or his Shares except when consented to by the non-transferring party in writing.  Any purported transfer in any other manner shall be void.  For purposes of this Agreement, the term "transfer," as to any Shares, means any sale, exchange, assignment, gift, bequest, the creation of any option or right to purchase, lien, security interest or other encumbrance, and any other disposition of any kind, whether voluntary or involuntary, affecting title to, possession of or voting rights in respect of such Shares or any interest therein.

5.2  Legend.  All certificates representing Shares from time to time owned by either party or its permitted transferees shall have endorsed upon the face thereof a legend substantially as follows:

"Transfer of the shares of stock represented by this certificate is restricted by an agreement dated June 20, 2010 among the shareholders of the corporation, which agreement contains provisions prohibiting the transfer of the shares represented by this certificate unless consented to by the non-transferring party in writing."

6.           Accounting, Inspection

6.1  Fiscal Year.  The fiscal year of NEWCORP shall be the calendar year.

6.2  Books and Records; Reporting.  NEWCORP shall keep true and accurate accounts, books and records of its operations in accordance with generally accepted accounting principles consistently applied to businesses of the type and size of NEWCORP.  NEWCORP's financial statements shall be audited annually by a firm of certified public accountants appointed by NEWCORP.  Copies of such financial statements, together with the report of such firm, shall promptly be given to each party.

6.3  Inspection.  Each party and its authorized representatives shall have the right at any time during reasonable business hours and without notice to visit and inspect the properties of NEWCORP, to examine its books of account and corporate records and to make copies thereof and to discuss the affairs, finances and accounts thereof with its officers, employees and agents.

7.           Representations and Warranties

Each party hereby represents and warrants to the other that:

7.1  Such party is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation, and has full corporate power and authority to carry on its business where and as now conducted, to own, lease, use and operate its properties as now conducted and to execute and deliver this Agreement and the agreements referred to in Section 5 to which it is a party, and to perform its obligations hereunder and thereunder.

7.2  The execution, delivery and performance by such party of this Agreement has been duly and validly authorized by all necessary corporate proceedings (including, but not limited to, approval by the board of directors and, if necessary, shareholders).  This Agreement has been duly executed and delivered by such party and constitutes the legal, valid and binding obligation of such party enforceable against such party in accordance with its terms.

  

  

  

 

7.3  Neither the execution and delivery of this Agreement or the agreements referred to in Section 5 to be executed by such party, nor the consummation of the transactions contemplated hereby or thereby, will (i) violate or result in a breach of or default under (x) any of the present provisions of the certificate of incorporation or by-laws (or other governing instrument) of such party or (y) any mortgage, indenture, contract, agreement, license, franchise, permit, instrument, trust, power, judgment, decree, order, ruling or federal or state statute or regulation to which such party is presently a party or by which it or its properties may be subject, (ii) result in the creation or imposition of any lien, claim, charge, restriction or encumbrance of any kind whatsoever upon, or give to any other person any interest or right (including any right of termination or cancellation) in or with respect to any properties, assets, business, agreements or contracts of such party or (iii) require any consent, approval or waiver of, filing with, or notification to any person (including, without limitation, any governmental or regulatory authority).

7.4  No investigation, action, suit or proceeding before any court or any governmental or regulatory authority has been commenced, and no investigation, action, suit or proceeding by any governmental or regulatory authority has been threatened, against such party or any of its principals, officers or directors (i) seeking to restrain, prevent, delay or change the transactions contemplated hereby, (ii) questioning the validity or legality of this Agreement or the transactions contemplated hereby, (iii) seeking damages in connection with any of such transactions or (iv) seeking to restrict the businesses or operations presently carried on by such party.

IN WITNESS THEREOF, YASHENG and CMARK have caused this Agreement to be executed on the date first above written intending to be legally bound as of that date.

                                                

	YASHENG ECO-TRADE CORPORATION	 	CMARK INTERNATIONAL, INC,
	 	 	 	 	 
	 	 	 	 	 
	
By:

	

/s/ William Lieberman

	 	
By:

	

/s/ Charles W. Jones Jr.

	
Name:   

	
William Lieberman

	 	
Name:   

	
Charles W. Jones Jr.

	
Title:

	
Acting President

	 	
Title:

	
President

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