Document:

Exhibit 10.2

 

Supplemental Share Purchase Agreement

 

THE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE OR ANY OTHER JURISDICTION. THERE ARE FURTHER RESTRICTIONS
ON THE TRANSFERABILITY OF THE SECURITIES DESCRIBED HEREIN.

 

THE PURCHASE OF THE SECURITIES INVOLVES
A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN BEAR THE RISK OF THE LOSS OF THEIR ENTIRE INVESTMENT.

 

Community Shores Bank Corporation

1030 W. Norton Avenue

Muskegon, Michigan 49441

 

Ladies and Gentlemen:

 

This Supplemental Share Purchase Agreement
(this “Letter Agreement”) is entered into by Community Shores Bank Corporation (“Community Shores”
or the “Company”) and Bruce J. Essex, Sr. (the “Investor”).  

 

Community Shores is conducting a registered
securities offering whereby it distributed at no charge to each of the holders of Common Stock on the record date for the Rights
Offering rights (the “Rights”) to purchase shares of Common Stock, at a price of $2.55 per share (the “Rights
Offering”). The Investor and Community Shores entered into a Share Purchase and Rights Offering Backstop Agreement dated
October 2, 2015 (the “Backstop Agreement”), pursuant to which the Investor agreed to serve as a backstop participant
to the Rights Offering.

 

In addition to the commitments provided
for in the Backstop Agreement, the Investor desires to purchase, and Community Shores desires to sell up to 431,372 shares of Common
Stock (the “Supplemental Shares”) at a price of $2.55 per share. The offering of the Supplemental Shares is
being made without registration of the Securities under the Securities Act of 1933, as amended (the "Securities Act"),
or any securities law of any state of the United States or of any other jurisdiction, and is being made only to "accredited
investors" (as defined in Rule 501 of Regulation D under the Securities Act).

 

In consideration of the premises and
respective covenants and agreements set forth in this Letter Agreement and other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound, the parties agree as follows:

 

     

     

    

 

1.          Subscription.
Subject to the terms and conditions hereof, the Investor hereby irrevocably subscribes for the Supplemental Shares set forth in
Appendix A hereto for the aggregate purchase price set forth in Appendix A, which is payable as described in Section
4 hereof. The Investor acknowledges that the Supplemental Shares will be subject to restrictions on transfer as set forth in
this Letter Agreement.

 

2.          Acknowledgements
with regard to the Backstop Agreement. The parties acknowledge as follows: (i) the Company has received subscriptions in the
Rights Offering for a total of 1,523,821 shares of Common Stock at $2.55 per share for gross proceeds of approximately $3.89 million;
(ii) the Thornapple Commitment (as defined in the Backstop Agreement) has been terminated; and (iii) the closing of the Rights
Offering remains subject to approval of the Federal Reserve Board under the Bank Change of Control Act.

 

3.          The
Closing. The closing of the purchase and sale of the Supplemental Shares (the "Closing") shall take place
at the offices of Community Shores Bank Corporation, at 1030 W. Norton Avenue, Muskegon, Michigan, or at such other location as
agreed to by mutual consent of the parties, as soon as practicable following satisfaction of the conditions set forth in Section
7 below.

 

4.          Payment
for Supplemental Shares. Payment for the Supplemental Shares shall be received by the Company from the Investor by wire transfer
of immediately available funds or other means approved by the Company at or prior to the Closing, in the amount as set forth in
Appendix A hereto. The Company shall deliver certificates representing the Supplemental Shares to the Investor at the Closing
bearing an appropriate legend referring to the fact that the Supplemental Shares were sold in reliance upon an exemption from registration
under the Securities Act.

 

5.          Representations
and Warranties of the Company. As of the Closing, the Company represents and warrants that:

 

(a)          The
Company is duly formed and validly existing under the laws of Michigan, with full power and authority to conduct its business as
it is currently being conducted and to own its assets; and has secured any other authorizations, approvals, permits and orders
required by law for the conduct by the Company of its business as it is currently being conducted.

 

(b)          The
Supplemental Shares have been duly authorized and, when issued, delivered and paid for in the manner set forth in this Letter Agreement,
will be validly issued, fully paid and nonassessable.

 

    2

     

    

 

6.          Representations
and Warranties of the Investor. The Investor hereby represents and warrants to and covenants with the Company that:

 

(a)          General.

 

(i)          Subject
to the approval of the Federal Reserve Board under the Bank Change of Control Act, the Investor has all requisite authority (and
in the case of an individual, the capacity) to purchase the Supplemental Shares, enter into this Letter Agreement and to perform
all the obligations required to be performed by the Investor hereunder, and such purchase will not contravene any law, rule or
regulation binding on the Investor or any investment guideline or restriction applicable to the Investor.

 

(ii)         The
Investor is a resident of the state set forth on the signature page hereto and is not acquiring the Supplemental Shares as a nominee
or agent or otherwise for any other person.

 

(b)          Information
Concerning the Company.

 

(i)          The
Investor understands and accepts that the purchase of the Supplemental Shares involves various risks, including the risks outlined
in the Company’s public filings (the “Public Filings”) with the U.S. Securities and Exchange Commission
(the "Commission"). The Investor represents that it is able to bear any loss associated with an investment in
the Supplemental Shares.

 

(ii)         The
Investor confirms that it is not relying on any communication (written or oral) of the Company or any of its affiliates, as investment
advice or as a recommendation to purchase the Supplemental Shares.

 

(iii)        The
Investor is familiar with the business and financial condition and operations of the Company, all as generally described in the
Public Filings. The Investor has had access to such information concerning the Company and the Supplemental Shares as it deems
necessary to enable it to make an informed investment decision concerning the purchase of the Supplemental Shares.

 

(iv)        The
Investor understands that, unless the Investor notifies the Company in writing to the contrary at or before the Closing, each of
the Investor's representations and warranties contained in this Letter Agreement will be deemed to have been reaffirmed and confirmed
as of the Closing, taking into account all information received by the Investor.

 

(v)         The
Investor understands that no federal or state agency has passed upon the merits or risks of an investment in the Supplemental Shares
or made any finding or determination concerning the fairness or advisability of this investment.

 

    3

     

    

 

(c)          Status
of Investor.

 

(i)          The
Investor has such knowledge, skill and experience in business, financial and investment matters that the Investor is capable of
evaluating the merits and risks of an investment in the Supplemental Shares. With the assistance of the Investor's own professional
advisors, to the extent that the Investor has deemed appropriate, the Investor has made its own legal, tax, accounting and financial
evaluation of the merits and risks of an investment in the Supplemental Shares and the consequences of this Letter Agreement. The
Investor has considered the suitability of the Supplemental Shares as an investment in light of its own circumstances and financial
condition and the Investor is able to bear the risks associated with an investment in the Supplemental Shares and its authority
to invest in the Supplemental Shares.

 

(ii)         The
Investor is an "accredited investor" as defined in Rule 501(a) under the Securities Act. The Investor agrees to furnish
any additional information requested by the Company or any of its affiliates to assure compliance with applicable U.S. federal
and state securities laws in connection with the purchase and sale of the Supplemental Shares. Any information that has been furnished
or that will be furnished by the Investor to evidence its status as an accredited investor is accurate and complete, and does not
contain any misrepresentation or material omission.

 

(d)          Restrictions
on Transfer or Sale of Supplemental Shares. As applies to the Investor:

 

(i)          The
Investor is acquiring the Supplemental Shares solely for the Investor’s own beneficial account, for investment purposes,
and not with a view to, or for resale in connection with, any distribution of the Supplemental Shares. The Investor understands
that the Supplemental Shares have not been registered under the Securities Act or any State Securities Laws by reason of specific
exemptions under the provisions thereof which depend in part upon the investment intent of the Investor and of the other representations
made by the Investor in this Letter Agreement. The Investor understands that the Company is relying upon the representations and
agreements contained in this Letter Agreement (and any supplemental information) for the purpose of determining whether this transaction
meets the requirements for such exemptions.

 

(ii)         The
Investor understands that the Supplemental Shares are "restricted securities" under applicable federal securities laws
and that the Securities Act and the rules of the Commission provide in substance that the Investor may dispose of the Securities
only pursuant to an effective registration statement under the Securities Act or an exemption therefrom.

 

    4

     

    

 

(iii)        The
Investor agrees: (A) that the Investor will not sell, assign, pledge, give, transfer or otherwise dispose of the Supplemental Shares
or any interest therein, or make any offer or attempt to do any of the foregoing, except pursuant to a registration of the Supplemental
Shares under the Securities Act and all applicable State Securities Laws, or in a transaction which is exempt from the registration
provisions of the Securities Act and all applicable State Securities Laws; (B) that the certificates representing the Supplemental
Shares will bear a legend making reference to the foregoing restrictions; and (C) that the Company and its affiliates shall not
be required to give effect to any purported transfer of such Supplemental Shares except upon compliance with the foregoing restrictions.

 

7.          Conditions
to Obligations of the Investor and the Company. The obligations of the Investor to purchase and pay for the Supplemental Shares
specified in Appendix A and of the Company to sell the Supplemental Shares are subject to the satisfaction at or prior to the Closing
of the following conditions precedent:

 

(a)          the
representations and warranties of the Company contained in Section 5 hereof and of the Investor contained in Section
6 hereof shall be true and correct as of the Closing in all respects with the same effect as though such representations and
warranties had been made as of the Closing; and

 

(b)          the
conditions precedent to the Investor’s obligations under the Backstop Agreement shall have been satisfied.

 

8.          Obligations
Irrevocable. The obligations of the Investor shall be irrevocable.

 

9.          Legend.
The certificates representing the Supplemental Shares sold pursuant to this Letter Agreement will be imprinted with a legend in
substantially the following form:

 

"THE SECURITIES EVIDENCED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES
LAWS OF ANY STATE OR OTHER JURISDICTION. THE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE STATE SECURITIES LAWS AND THE SECURITIES LAWS OF OTHER JURISDICTIONS, AND IN
THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY
TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT AND SUCH OTHER APPLICABLE LAWS."

 

    5

     

    

 

10.         Backstop
Agreement. The parties hereto hereby acknowledge that:

 

(a)          Notwithstanding
Section 5(a) of the Backstop Agreement, Thornapple (as defined therein) has terminated its agreement to acquire additional equity
securities of the Company;

 

(b)          Notwithstanding
Section 6 of the Backstop Agreement, the approval of the Federal Reserve Board under the Bank Change of Control Act shall be required
before the transactions contemplated by the Backstop Agreement may be consummated;

 

(c)          The
representations and warranties set forth in Sections 8(a) and 8(c) of the Backstop Agreement are expressly qualified by the need
to secure the approval of the Federal Reserve Board under the Bank Change of Control Act; and

 

(d)          Notwithstanding
Section 11 of the Backstop Agreement, the Backstop Party (as defined therein) may assign any of his rights hereunder to any trust
which the Backstop Party may establish for the purpose of holding equity securities of the Company.

 

11.         Waiver,
Amendment. Neither this Letter Agreement nor any provisions hereof shall be modified, changed, discharged or terminated except
by an instrument in writing, signed by the party against whom any waiver, change, discharge or termination is sought.

 

12.         Assignability.
Neither this Letter Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable
by either the Company or the Investor without the prior written consent of the other party; provided, that the Investor may assign
any of his rights hereunder to any trust which the Investor may establish for the purpose of holding equity securities of the Company.

 

13.         Waiver
of Jury Trial. THE INVESTOR IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING
OUT OF THE TRANSACTIONS CONTEMPLATED BY THIS LETTER AGREEMENT.

 

14.         Submission
to Jurisdiction. With respect to any suit, action or proceeding relating to any offers, purchases or sales of the Supplemental
Shares by the Investor ("Proceedings"), the Investor irrevocably submits to the jurisdiction of the federal or
state courts located in Grand Rapids, Michigan, which submission shall be exclusive unless none of such courts has lawful jurisdiction
over such Proceedings.

 

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15.         Governing
Law. This Letter Agreement shall be governed by and construed in accordance with the laws of the State of Michigan.

 

16.         Section
and Other Headings. The section and other headings contained in this Letter Agreement are for reference purposes only and shall
not affect the meaning or interpretation of this Letter Agreement.

 

17.         Counterparts.
This Letter Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed
to be an original and all of which together shall be deemed to be one and the same agreement.

 

18.         Notices.
All notices and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered
personally or sent by registered or certified mail, return receipt requested, postage prepaid to the following addresses (or such
other address as either party shall have specified by notice in writing to the other):

 

	If to the Company:	
        1030 W. Norton Avenue

Muskegon, Michigan

Facsimile:    231-780-1860

Attn: Heather Brolick, President and CEO

E-mail: hbrolick@communityshores.com 

	 	 
	with a copy to:	
        Dickinson Wright PLLC

        Facsimile:     734-623-1625

        Attn: Bradley Wyatt

        E-mail: bwyatt@dickinsonwright.com 

	 	 
	If to the Investor:	
        111 W. Western Avenue

Facsimile:    (231) 777-7319

E-mail: bessex735@aol.com

Attention: Bruce J. Essex Sr. 

	 	 
	with a copy to:	
        Katten Muchin Rosenmann LLP

         

        Facsimile:    (312) 902-1061

        E-mail: brooks.giles@kattenlaw

        Attention:Jeff Werthan/Brooks

        Giles

 

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19.         Binding
Effect. The provisions of this Letter Agreement shall be binding upon and accrue to the benefit of the parties hereto and their
respective heirs, legal representatives, successors and assigns.

 

20.         Survival.
All representations, warranties and covenants contained in this Letter Agreement shall survive the acceptance of the subscription
by the Company and the Closing.

 

21.         Notification
of Changes. The Investor hereby covenants and agrees to notify the Company upon the occurrence of any event prior to the closing
of the purchase of the Supplemental Shares pursuant to this Letter Agreement which would cause any representation, warranty, or
covenant of the Investor contained in this Letter Agreement to be false or incorrect.

 

22.         Severability.
If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality
or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term
or provision in any other jurisdiction.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the Investor has
executed this Letter Agreement this 13th day of January, 2016.

 

	 	Very truly yours,
	 	 
	 	/s/  Bruce J. Essex
	 	Name:  Bruce J. Essex, Sr.

 

The foregoing is hereby accepted and
agreed

to in all respects by the undersigned:

 

Community Shares Bank Corporation

 

	/s/ Heather Brolick	 
	Name:  Heather Brolick	 
	Title:    President and Chief Executive Officer	 

 

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APPENDIX
A

 

 

 

Consideration
To Be Delivered

 

	Securities to Be Acquired	 	 	Price Per

Share	 	Aggregate Purchase Price to be

Paid	 
	143,790 shares of common stock	 	 	$	2.55	 	US$	366,667.05	 

 

    10Exhibit 10.3

 

Supplemental Share Purchase Agreement

 

THE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE OR ANY OTHER JURISDICTION. THERE ARE FURTHER RESTRICTIONS
ON THE TRANSFERABILITY OF THE SECURITIES DESCRIBED HEREIN.

 

THE PURCHASE OF THE SECURITIES INVOLVES
A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN BEAR THE RISK OF THE LOSS OF THEIR ENTIRE INVESTMENT.

 

Community Shores Bank Corporation

1030 W. Norton Avenue

Muskegon, Michigan 49441

 

Ladies and Gentlemen:

 

This Supplemental Share Purchase Agreement
(this “Letter Agreement”) is entered into by Community Shores Bank Corporation (“Community Shores”
or the “Company”) and Bruce J. Essex, Jr. (the “Investor”).  

 

Community Shores is conducting a registered
securities offering whereby it distributed at no charge to each of the holders of Common Stock on the record date for the Rights
Offering rights (the “Rights”) to purchase shares of Common Stock, at a price of $2.55 per share (the “Rights
Offering”). The Investor and Community Shores entered into a Share Purchase and Rights Offering Backstop Agreement dated
October 2, 2015 (the “Backstop Agreement”), pursuant to which the Investor agreed to serve as a backstop participant
to the Rights Offering.

 

In addition to the commitments provided
for in the Backstop Agreement, the Investor desires to purchase, and Community Shores desires to sell up to 431,372 shares of Common
Stock (the “Supplemental Shares”) at a price of $2.55 per share. The offering of the Supplemental Shares is
being made without registration of the Securities under the Securities Act of 1933, as amended (the "Securities Act"),
or any securities law of any state of the United States or of any other jurisdiction, and is being made only to "accredited
investors" (as defined in Rule 501 of Regulation D under the Securities Act).

 

In consideration of the premises and respective
covenants and agreements set forth in this Letter Agreement and other good and valuable consideration the receipt and sufficiency
of which are hereby acknowledged, and intending to be legally bound, the parties agree as follows:

 

     

    	 

    

 

1.            Subscription.
Subject to the terms and conditions hereof, the Investor hereby irrevocably subscribes for the Supplemental Shares set forth in
Appendix A hereto for the aggregate purchase price set forth in Appendix A, which is payable as described in Section
4 hereof. The Investor acknowledges that the Supplemental Shares will be subject to restrictions on transfer as set forth in
this Letter Agreement.

 

2.            Acknowledgements
with regard to the Backstop Agreement. The parties acknowledge as follows: (i) the Company has received subscriptions in the
Rights Offering for a total of 1,523,821 shares of Common Stock at $2.55 per share for gross proceeds of approximately $3.89 million;
(ii) the Thornapple Commitment (as defined in the Backstop Agreement) has been terminated; and (iii) the closing of the Rights
Offering remains subject to approval of the Federal Reserve Board under the Bank Change of Control Act.

 

3.            The
Closing. The closing of the purchase and sale of the Supplemental Shares (the "Closing") shall take place
at the offices of Community Shores Bank Corporation, at 1030 W. Norton Avenue, Muskegon, Michigan, or at such other location as
agreed to by mutual consent of the parties, as soon as practicable following satisfaction of the conditions set forth in Section
7 below.

 

4.            Payment
for Supplemental Shares. Payment for the Supplemental Shares shall be received by the Company from the Investor by wire transfer
of immediately available funds or other means approved by the Company at or prior to the Closing, in the amount as set forth in
Appendix A hereto. The Company shall deliver certificates representing the Supplemental Shares to the Investor at the Closing
bearing an appropriate legend referring to the fact that the Supplemental Shares were sold in reliance upon an exemption from registration
under the Securities Act.

 

5.            Representations
and Warranties of the Company. As of the Closing, the Company represents and warrants that:

 

(a)          The
Company is duly formed and validly existing under the laws of Michigan, with full power and authority to conduct its business as
it is currently being conducted and to own its assets; and has secured any other authorizations, approvals, permits and orders
required by law for the conduct by the Company of its business as it is currently being conducted.

 

(b)          The
Supplemental Shares have been duly authorized and, when issued, delivered and paid for in the manner set forth in this Letter Agreement,
will be validly issued, fully paid and nonassessable.

 

    2 

    	 

    

 

6.            Representations
and Warranties of the Investor. The Investor hereby represents and warrants to and covenants with the Company that:

 

(a)          General.

 

(i)          Subject
to the approval of the Federal Reserve Board under the Bank Change of Control Act, the Investor has all requisite authority (and
in the case of an individual, the capacity) to purchase the Supplemental Shares, enter into this Letter Agreement and to perform
all the obligations required to be performed by the Investor hereunder, and such purchase will not contravene any law, rule or
regulation binding on the Investor or any investment guideline or restriction applicable to the Investor.

 

(ii)         The
Investor is a resident of the state set forth on the signature page hereto and is not acquiring the Supplemental Shares as a nominee
or agent or otherwise for any other person.

 

(b)          Information
Concerning the Company.

 

(i)          The
Investor understands and accepts that the purchase of the Supplemental Shares involves various risks, including the risks outlined
in the Company’s public filings (the “Public Filings”) with the U.S. Securities and Exchange Commission
(the "Commission"). The Investor represents that it is able to bear any loss associated with an investment in
the Supplemental Shares.

 

(ii)         The
Investor confirms that it is not relying on any communication (written or oral) of the Company or any of its affiliates, as investment
advice or as a recommendation to purchase the Supplemental Shares.

 

(iii)        The
Investor is familiar with the business and financial condition and operations of the Company, all as generally described in the
Public Filings. The Investor has had access to such information concerning the Company and the Supplemental Shares as it deems
necessary to enable it to make an informed investment decision concerning the purchase of the Supplemental Shares.

 

(iv)        The
Investor understands that, unless the Investor notifies the Company in writing to the contrary at or before the Closing, each of
the Investor's representations and warranties contained in this Letter Agreement will be deemed to have been reaffirmed and confirmed
as of the Closing, taking into account all information received by the Investor.

 

(v)         The
Investor understands that no federal or state agency has passed upon the merits or risks of an investment in the Supplemental Shares
or made any finding or determination concerning the fairness or advisability of this investment.

 

    3 

    	 

    

 

(c)          Status
of Investor.

 

(i)          The
Investor has such knowledge, skill and experience in business, financial and investment matters that the Investor is capable of
evaluating the merits and risks of an investment in the Supplemental Shares. With the assistance of the Investor's own professional
advisors, to the extent that the Investor has deemed appropriate, the Investor has made its own legal, tax, accounting and financial
evaluation of the merits and risks of an investment in the Supplemental Shares and the consequences of this Letter Agreement. The
Investor has considered the suitability of the Supplemental Shares as an investment in light of its own circumstances and financial
condition and the Investor is able to bear the risks associated with an investment in the Supplemental Shares and its authority
to invest in the Supplemental Shares.

 

(ii)         The
Investor is an "accredited investor" as defined in Rule 501(a) under the Securities Act. The Investor agrees to furnish
any additional information requested by the Company or any of its affiliates to assure compliance with applicable U.S. federal
and state securities laws in connection with the purchase and sale of the Supplemental Shares. Any information that has been furnished
or that will be furnished by the Investor to evidence its status as an accredited investor is accurate and complete, and does not
contain any misrepresentation or material omission.

 

(d)          Restrictions
on Transfer or Sale of Supplemental Shares. As applies to the Investor:

 

(i)          The
Investor is acquiring the Supplemental Shares solely for the Investor’s own beneficial account, for investment purposes,
and not with a view to, or for resale in connection with, any distribution of the Supplemental Shares. The Investor understands
that the Supplemental Shares have not been registered under the Securities Act or any State Securities Laws by reason of specific
exemptions under the provisions thereof which depend in part upon the investment intent of the Investor and of the other representations
made by the Investor in this Letter Agreement. The Investor understands that the Company is relying upon the representations and
agreements contained in this Letter Agreement (and any supplemental information) for the purpose of determining whether this transaction
meets the requirements for such exemptions.

 

(ii)         The
Investor understands that the Supplemental Shares are "restricted securities" under applicable federal securities laws
and that the Securities Act and the rules of the Commission provide in substance that the Investor may dispose of the Securities
only pursuant to an effective registration statement under the Securities Act or an exemption therefrom.

 

(iii)        The
Investor agrees: (A) that the Investor will not sell, assign, pledge, give, transfer or otherwise dispose of the Supplemental Shares
or any interest therein, or make any offer or attempt to do any of the foregoing, except pursuant to a registration of the Supplemental
Shares under the Securities Act and all applicable State Securities Laws, or in a transaction which is exempt from the registration
provisions of the Securities Act and all applicable State Securities Laws; (B) that the certificates representing the Supplemental
Shares will bear a legend making reference to the foregoing restrictions; and (C) that the Company and its affiliates shall not
be required to give effect to any purported transfer of such Supplemental Shares except upon compliance with the foregoing restrictions.

 

    4 

    	 

    

 

7.            Conditions
to Obligations of the Investor and the Company. The obligations of the Investor to purchase and pay for the Supplemental Shares
specified in Appendix A and of the Company to sell the Supplemental Shares are subject to the satisfaction at or prior to the Closing
of the following conditions precedent:

 

(a)          the
representations and warranties of the Company contained in Section 5 hereof and of the Investor contained in Section
6 hereof shall be true and correct as of the Closing in all respects with the same effect as though such representations and
warranties had been made as of the Closing; and

 

(b)          the
conditions precedent to the Investor’s obligations under the Backstop Agreement shall have been satisfied.

 

8.            Obligations
Irrevocable. The obligations of the Investor shall be irrevocable.

 

9.            Legend.
The certificates representing the Supplemental Shares sold pursuant to this Letter Agreement will be imprinted with a legend in
substantially the following form:

 

"THE SECURITIES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS
OF ANY STATE OR OTHER JURISDICTION. THE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE STATE SECURITIES LAWS AND THE SECURITIES LAWS OF OTHER JURISDICTIONS, AND IN
THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY
TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT AND SUCH OTHER APPLICABLE LAWS."

 

    5 

    	 

    

 

10.            Board
Observer. So long as Investor, together with its affiliates, beneficially owns at least 5% of the issued and outstanding voting
stock of the Company, the Investor shall have the right (but not the obligation) to designate one (1) individual to attend all
Board of Directors meetings of the Company as an observer (the “Board Observer”). The Board Observer shall not
have voting rights or fiduciary obligations to the Company or its shareholders, but shall be bound by the same confidentiality
and insider trading obligations as the members of the Board. The Company will provide the Board Observer with actual notice of
all regular and special meetings of the Company’s Board of Directors in the same manner as provided to directors, and will
provide to such Board Observer a copy of all materials and information distributed at or prior to such meetings or otherwise to
the directors of the Company. Such meetings will be held in person at least quarterly. The Board Observer shall execute a confidentiality
agreement in form and substance reasonably satisfactory to the Company prior to participating in a meeting of the Board or receiving
related materials and information. Notwithstanding the foregoing, (1) the Board Observer may not attend any portion of a meeting
of the Board during which a transaction or agreement with or for the benefit of the Backstop Party or any affiliate is being considered
by the Board; (2) the Board shall have the right to require the Board Observer to leave any meeting if the Board needs to deliberate
independently; and (3) the Board may exclude the Board Observer from any meeting or portion thereof if access to information discussed
or presented or attendance at such meeting would adversely affect the attorney-client privilege between the Company and its counsel.
Attendance of a Board Observer at a meeting of the Board shall not be required to establish a quorum for such meeting.

 

11.          Board
Nomination Right.

 

(a)          So
long as Investor, together with its affiliates, beneficially owns at least 10% of the issued and outstanding voting stock of the
Company and if Bruce J. Essex ceases to serve as a member of the Board (the “Designation Period”), the Investor
shall have the right (but not the obligation) to designate one person to be nominated for election to the Board (a “Nominee”)
by giving written notice (“Notice of Nomination”) to the Chairman of the Board or the Secretary of the Company.
As a condition of exercising its right under Section 11 of this Agreement, the Investor hereby agrees that effective upon
the election of such Nominee to the Board, the Investor’s rights under Section 10 of this Agreement shall automatically
toll and no person may continue to act in the capacity as Board Observer during the period of time that the Nominee serves on the
Board. The Nominee shall be selected by the Investor in reasonable consultation with (but without the need for the approval of)
the Company’s Nominating and Corporate Governance Committee of its Board of Directors (the “Nominating Committee”).

 

(b)          Upon
receipt of a Notice of Nomination, the Company will promptly (i) increase the size of the Board to create a vacancy (if no
vacancy already exists); (ii) appoint such Nominee as a member of the Board; and (iii) at all times during the Designation
Period, include, and shall use its best efforts to cause the Board, whether acting through the Nominating and Corporate Governance
Committee of the Board or otherwise, to include the Nominee in the slate of nominees recommended to the shareholders for election
as a director at any annual or special meeting of the shareholders held during the Designation Period (or, if permitted, by any
action by written consent of the shareholders taken during the Designation Period) at or by which directors of the Company are
to be elected.

 

    6 

    	 

    

 

(c)          If
a Board vacancy occurs during the Designation Period solely because of the death, disability, disqualification, resignation or
removal of the Nominee, the Investor shall be entitled to designate such person’s successor in accordance with the procedures
of Section 11(b) above.

 

(d)          Nominee
shall be entitled to the same compensation paid and expense reimbursement payable to other non-employee Directors.

 

(e)          For
the avoidance of doubt, the provisions of this Agreement shall not limit any rights the Investor may have (i) as a shareholder
of the Company pursuant to Michigan law or the Company’s Articles of Incorporation or bylaws, or (ii) pursuant to the Backstop
Agreement, which, except as explicitly modified pursuant to Section 12 below, shall continue in full force and effect among the
parties thereto.

 

12.          Backstop
Agreement. The parties hereto hereby acknowledge that:

 

(a)          Notwithstanding
Section 5(a) of the Backstop Agreement, Thornapple (as defined therein) has terminated its agreement to acquire additional equity
securities of the Company;

 

(b)          Notwithstanding
Section 6 of the Backstop Agreement, the approval of the Federal Reserve Board under the Bank Change of Control Act shall be required
before the transactions contemplated by the Backstop Agreement may be consummated;

 

(c)          The
representations and warranties set forth in Sections 8(a) and 8(c) of the Backstop Agreement are expressly qualified by the need
to secure the approval of the Federal Reserve Board under the Bank Change of Control Act; and

 

(d)          Notwithstanding
Section 11 of the Backstop Agreement, the Backstop Party (as defined therein) may assign any of his rights hereunder to any trust
which the Backstop Party may establish for the purpose of holding equity securities of the Company.

 

13.          Waiver,
Amendment. Neither this Letter Agreement nor any provisions hereof shall be modified, changed, discharged or terminated except
by an instrument in writing, signed by the party against whom any waiver, change, discharge or termination is sought.

 

14.          Assignability.
Neither this Letter Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable
by either the Company or the Investor without the prior written consent of the other party; provided, that the Investor may assign
any of his rights hereunder to any trust which the Investor may establish for the purpose of holding equity securities of the Company.

 

    7 

    	 

    

 

15.          Waiver
of Jury Trial. THE INVESTOR IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING
OUT OF THE TRANSACTIONS CONTEMPLATED BY THIS LETTER AGREEMENT.

 

16.          Submission
to Jurisdiction. With respect to any suit, action or proceeding relating to any offers, purchases or sales of the Supplemental
Shares by the Investor ("Proceedings"), the Investor irrevocably submits to the jurisdiction of the federal or
state courts located in Grand Rapids, Michigan, which submission shall be exclusive unless none of such courts has lawful jurisdiction
over such Proceedings.

 

17.          Governing
Law. This Letter Agreement shall be governed by and construed in accordance with the laws of the State of Michigan.

 

18.          Section
and Other Headings. The section and other headings contained in this Letter Agreement are for reference purposes only and shall
not affect the meaning or interpretation of this Letter Agreement.

 

19.          Counterparts.
This Letter Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed
to be an original and all of which together shall be deemed to be one and the same agreement.

 

20.          Notices.
All notices and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered
personally or sent by registered or certified mail, return receipt requested, postage prepaid to the following addresses (or such
other address as either party shall have specified by notice in writing to the other):

 

	If to the Company:	1030 W. Norton Avenue
	 	Muskegon, Michigan
	 	Facsimile:     231-780-1860
	 	Attn:  Heather Brolick, President and CEO
	 	E-mail: hbrolick@communityshores.com
	 	 
	with a copy to:	Dickinson Wright PLLC
	 	Facsimile:     734-623-1625
	 	Attn:  Bradley Wyatt
	 	E-mail: bwyatt@dickinsonwright.com

 

    8 

    	 

    

 

	If to the Investor:	Bruce J. Essex, Jr. 2016 Revocable Trust
	 	Facsimile:     231-777-7319
	 	E-mail: johnessex@coreparkinvestments.com
	 	Attention:     B. John Essex – Trustee
	 	 
	with a copy to:	Katten Muchin Rosenmann LLP
	 	Facsimile:     (312) 902-1061
	 	E-mail: brooks.giles@kattenlaw.com
	 	Attention:     Brooks T. Giles / Jeffrey Werthan
	 	 

 

21.         Binding
Effect. The provisions of this Letter Agreement shall be binding upon and accrue to the benefit of the parties hereto and their
respective heirs, legal representatives, successors and assigns.

 

22.         Survival.
All representations, warranties and covenants contained in this Letter Agreement shall survive the acceptance of the subscription
by the Company and the Closing.

 

23.         Notification
of Changes. The Investor hereby covenants and agrees to notify the Company upon the occurrence of any event prior to the closing
of the purchase of the Supplemental Shares pursuant to this Letter Agreement which would cause any representation, warranty, or
covenant of the Investor contained in this Letter Agreement to be false or incorrect.

 

24.         Severability.
If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality
or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term
or provision in any other jurisdiction.

 

[SIGNATURE PAGE FOLLOWS]

 

    9 

    	 

    

 

IN WITNESS WHEREOF, the Investor has executed
this Letter Agreement this 13th day OF January, 2016.

 

	 	Very truly yours,
	 	 
	 	/s/ Bruce J. Essex, Jr.
	 	Name:  Bruce J. Essex, Jr.

 

The foregoing is hereby accepted and agreed

to in all respects by the undersigned:

 

Community Shares Bank Corporation

 

	/s/ Heather Brolick	 
	Name:  Heather Brolick	 
	Title:    President and Chief Executive Officer	 

    10 

    	 

    

 

 

APPENDIX
A

 

Consideration
To Be Delivered

 

	Securities to Be Acquired	 	Price Per

Share	 	 	Aggregate Purchase Price to be Paid	 
	143,790 shares of common stock	 	$	2.55	 	 	US$	 366,667.05	 

 

    11

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