Document:

rm8kex10_4.htm

     

    Exhibit
10.4

     

    VIRGIN
MEDIA INC.

     

    RESTRICTED
STOCK AGREEMENT

     

    

     

    RESTRICTED STOCK AGREEMENT,
dated as of July 3, 2009, between Virgin Media Inc., a Delaware corporation (the
“Company”), and Neil Berkett (the “Executive”).

     

    WHEREAS,
the Compensation Committee of the Board of Directors of the Company (the
“Compensation Committee”) wishes to grant to the Executive, and the Executive
wishes to accept from the Company, shares of common stock of the Company, par
value $0.01 per share (the “Restricted Stock”), to be granted pursuant to the
Virgin Media Inc. 2006 Stock Incentive Plan (the “Plan”);

     

    NOW,
THEREFORE, the parties hereto agree as follows:

     

    
      	
              1.  

            	
              Grant of Restricted
      Stock.

            

    

     

    The
Company hereby grants to the Executive, and the Executive hereby accepts from
the Company, 375,000 shares of Restricted Stock on the terms and conditions set
forth in this Agreement.  This Agreement is also subject to the terms
and conditions set forth in the Plan.  Capitalized terms used but not
defined herein shall have the meanings set forth in the Plan.

     

    
      	
              2.  

            	
              Rights of Executive.

            

    

     

    Except as
otherwise provided in this Agreement, the Executive shall be entitled, at all
times on and after the date that the shares of Restricted Stock are issued, to
exercise all the rights of a stockholder with respect to the shares of
Restricted Stock (whether or not the Transfer Restrictions thereon shall have
lapsed), including the right to vote the shares of Restricted Stock and the
right, subject to Section 6 hereof, to receive dividends
thereon.  Notwithstanding the foregoing, prior to the Lapse Date (as
defined below), the Executive shall not be entitled to transfer, sell, pledge,
hypothecate, assign, or otherwise dispose of or encumber, the shares of
Restricted Stock (collectively, the “Transfer Restrictions”).  The
Executive hereby acknowledges that the Company may set policies from time to
time on minimum stock holdings of its key executives and such policies, as in
effect from time to time, may restrict transfers of vested shares by the
Executive.  The Executive agrees to comply with these policies and the
Company’s insider trading policy as in effect from time to time.

     

    3.           Vesting and Lapse of
Transfer Restrictions.

     

    
      	
               
      

            	
              3.1

            	
              The
      Transfer Restrictions on the Restricted Stock shall lapse and the
      Restricted Stock granted hereunder shall vest as provided for on Exhibit A
      hereto if the performance conditions set forth therein have been
      attained.

            

    

     

    
      	
               
      

            	
              3.2

            	
              Notwithstanding
      anything to the contrary provided in the Plan or otherwise, the Transfer
      Restrictions on all of the shares of Restricted Stock granted hereunder
      and then outstanding shall not lapse and such shares of Restricted Stock
      shall not vest solely due to the occurrence of an Acceleration
      Event.

            

    

     

    4.           Escrow and Delivery of
Shares.

     

    
      	
               
      

            	
              4.1

            	
              Certificates
      representing the shares of Restricted Stock shall be issued and held by
      the Company in escrow and shall remain in the custody of the Company until
      their delivery to the Executive or the Executive’s estate as set forth in
      Section 4.2 hereof, subject to the Executive’s delivery of any documents
      which the Company in its discretion may require as a condition to the
      issuance of shares and the delivery of shares to the Executive or the
      Executive’s estate.

            

    

     

    
      	
               
      

            	
              4.2

            	
              Certificates
      representing those shares of Restricted Stock in respect of which the
      Transfer Restrictions have lapsed pursuant to Section 3 hereof shall be
      delivered to the Executive as soon as practicable following the Lapse
      Date, provided that the Executive has satisfied all applicable Withholding
      Tax requirements with respect to the Restricted
  Stock.

            

    

     

    
      	
               
      

            	
              4.3

            	
              The
      Executive may receive, hold, sell, or otherwise dispose of those shares
      delivered to the Executive pursuant to Section 4.2 free and clear of the
      Transfer Restrictions, but subject to compliance with all federal and
      state securities laws.

            

    

     

    
      	
               
      

            	
              4.4

            	
              Prior
      to the Lapse Date, each stock certificate evidencing shares of Restricted
      Stock shall bear a legend in substantially the following
    form:

            

    

     

    “This
certificate and the shares of stock represented hereby are subject to the terms
and conditions (including forfeiture, restrictions against transfer and rights
of repurchase, if applicable) contained in the Restricted Stock Agreement (the
“Agreement”) between the registered owner of the shares represented hereby and
the Company.  Release from such terms and conditions shall be made
only in accordance with the provisions of the Agreement, a copy of which is on
file in the office of the Secretary of Virgin Media Inc..”

     

    
      	
               
      

            	
              4.5

            	
              As
      soon as practicable following the Lapse Date, the Company shall issue new
      certificates in respect of the shares that have vested as of the Lapse
      Date which shall not bear the legend set forth in Section 4.4, which
      certificates shall be delivered in accordance with Section 4.2
      hereof.

            

    

     

    
      	
              5.  

            	
              Effect of Termination
      of Employment for any
Reason.

            

    

     

    Upon
termination of the Executive’s employment with the Company and its Affiliates,
if applicable, for any reason, the Executive shall forfeit the shares of
Restricted Stock which are then subject to the Transfer Restrictions, and, from
and after such forfeiture, such shares of Restricted Stock shall cease to be
outstanding and the Executive shall have no rights with respect thereto;
provided, that, if the Executive’s employment shall terminate after the end of a
fiscal year of the Company and prior to the date of the determination as to
whether the performance conditions applicable to such fiscal year have been met,
the shares of Restricted Stock subject to vesting in respect of such fiscal year
shall remain outstanding following the termination of the Executive’s employment
and shall vest or be forfeited when such determination is made, in either case
based on such determination.

     

    
      	
              6.  

            	
              Dividend
      Rights.

            

    

     

    All
dividends declared and paid by the Company on shares of Restricted Stock shall
be deferred until the lapsing of the Transfer Restrictions pursuant to Section 3
hereof (and shall be subject to forfeiture upon forfeiture of the shares of
Restricted Stock as to which such deferred dividends relate).  The
deferred dividends shall be held by the Company for the account of the
Executive.  Upon the Lapse Date, the dividends allocable to the shares
of Restricted Stock as to which the Transfer Restrictions have lapsed shall be
paid to the Executive (without interest).  The Company may require
that the Executive invest any cash dividends received in additional Restricted
Stock which shall be subject to the same conditions and restrictions as the
Restricted Stock granted under this Agreement.

     

    
      	
              7.  

            	
              No Right to Continued Employment.

            

    

     

    Nothing
in this Agreement shall be interpreted or construed to confer upon the Executive
any right with respect to continuance of employment by the Company or any of its
Affiliates, nor shall this Agreement interfere in any way with the right of the
Company or any such Affiliate to terminate the Executive’s employment at any
time.

     

    
      	
              8.  

            	
              Withholding of Taxes.

            

    

     

    The
Executive shall pay to the Company, or the Company and the Executive shall agree
on such other arrangements necessary for the Executive to pay, the applicable
federal, state and local income taxes required by law to be withheld (the
“Withholding Taxes”), if any, upon the vesting and delivery of the
shares.  The Company shall have the right to deduct from any payment
of cash to the Executive an amount equal to the Withholding Taxes in
satisfaction of the Executive’s obligation to pay Withholding
Taxes.

     

    
      	
              9.  

            	
              Modification
      of Agreement.

            

    

     

    This
Agreement may be modified, amended, suspended or terminated, and any terms or
conditions may be waived, but only by a written instrument executed by the
parties hereto.

     

    
      	
              10.  

            	
              Severability.

            

    

     

    Should
any provision of this Agreement be held by a court of competent jurisdiction to
be unenforceable or invalid for any reason, the remaining provisions of this
Agreement shall not be affected by such holding and shall continue in full force
and effect in accordance with their terms.

     

    
      	
              11.  

            	
              Governing
      Law.

            

    

     

    The
validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of New York without giving effect to the
conflicts of laws principles thereof which might result in the application of
the laws of any other jurisdiction.

     

    
      	
              12.  

            	
              Successors in Interest;
      Transfer.

            

    

     

    This
Agreement shall inure to the benefit of and be binding upon any successor to the
Company.  This Agreement shall inure to the benefit of the Executive’s
heirs, executors, administrators and successors.  All obligations
imposed upon the Executive and all rights granted to the Company under this
Agreement shall be binding upon the Executive’s heirs, executors, administrators
and successors.  This Agreement is not assignable by the
Executive.

     

    

     

    [the
remainder of this page is intentionally blank.]

     

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        
          
            	 	VIRGIN MEDIA
    INC.	 
	 	 	 	 
	 	 	 	 
	
                     

                  	
                    By:
      

                  	/s/ Bryan
      H. Hall	 
	 	Name: 	Bryan
      H. Hall	 
	 	Title: 	Secretary
      and General Counsel	 
	 	 	 	 

          

        

      

    

     

     

    

    

    

    ACCEPTED
AND AGREED

    

    

    

    

    By:               /s/ Neil
Berkett

    Name:       Neil Berkett

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    Exhibit
A

    

    Performance
Conditions

    

    The
Transfer Restrictions shall lapse and the Restricted Stock granted hereunder
shall vest as follows:

    

    

    Comprehensive List of
Objectives.  As to the number of shares set forth below if
performance conditions relating to a comprehensive list of objectives
established by the Compensation Committee in respect of the Company’s 2009
fiscal year have been met, so long as the Executive has remained continuously
employed by the Company from the date of commencement of his employment through
December 31, 2009:

     

     

    
      
        
          	
                  No of Shares

                	
                  Relevant Fiscal Year

                	
                  Lapse Date

                
	
                  187,500

                	
                  2009

                	
                  March
      12, 2010

                

        

      

    

     

    

     

    Cumulative Group Simple Cash
Flow. As to the number of shares set forth below if performance
conditions relating to cumulative group simple cash flow in respect of the
fiscal years shown below, established by the Compensation Committee pursuant to
the Company’s 2009-2011 long-term incentive plan, have been met, so long as the
Executive has remained continuously employed by the Company from the date of
commencement of his employment through December 31, 2011:

     

     

    
      
        
          	
                  No of Shares

                	
                  Relevant Fiscal Years

                	
                  Lapse Date

                
	
                  187,500

                	
                  2009
      – 2011

                	
                  March
      12, 2012Exhibit 10.1
                                                                    ------------

                            AGREEMENT BY AND BETWEEN
                        City National Bank of New Jersey
                               Newark, New Jersey
                                       and
                         The Comptroller of the Currency

      City  National  Bank of New Jersey,  Newark,  New Jersey  ("Bank") and the
Comptroller of the Currency of the United States of America ("Comptroller") wish
to protect the interests of the depositors, other customers, and shareholders of
the Bank,  and, toward that end, wish the Bank to operate safely and soundly and
in accordance with all applicable laws, rules and regulations.

      The Comptroller, through his National Bank Examiner, has examined the Bank
and his/her findings are contained in the Report of Examination  ("ROE") for the
examination  commenced on December 1, 2008. The Comptroller has found unsafe and
unsound banking  practices  relating to asset quality and credit risk management
at the Bank.

      In consideration of the above premises, it is agreed, between the Bank, by
and through its duly elected and acting Board of  Directors  ("Board"),  and the
Comptroller, through his authorized representative,  that the Bank shall operate
at all times in compliance with the articles of this Agreement.

                                    Article I
                                  JURISDICTION
                                  ------------

      This Agreement shall be construed to be a "written  agreement entered into
with the agency" within the meaning of 12 U.S.C. ss.1818(b)(1).

      This Agreement shall be construed to be a "written  agreement between such
depository  institution  and  such  agency"  within  the  meaning  of 12  U.S.C.
ss.1818(e)(1) and 12 U.S.C. ss.1818(i)(2).

      This  Agreement  shall be  construed  to be a "formal  written  agreement"
within the meaning of 12 C.F.R. ss.5.51(c)(6)(ii). See 12 U.S.C. ss.1831i.

      This Agreement shall be construed to be a "written  agreement"  within the
meaning of 12 U.S.C. ss.1818(u)(1)(A).

      All  reports or plans  which the Bank or Board has agreed to submit to the
Assistant  Deputy  Comptroller  pursuant to this Agreement shall be forwarded to
the:

      Kristin A. Kiefer
      Assistant Deputy Comptroller
      New York Metro West Field Office
      343 Thornall Street, Suite 610
      Edison, New Jersey 08837

                                       1
<PAGE>

                                   Article II
                              COMPLIANCE COMMITTEE
                              --------------------

      Within  thirty  (30) days of the date of this  Agreement,  the Board shall
appoint a Compliance Committee of at least three (3) directors, of which no more
than one (1) shall be an employee or controlling  shareholder of the Bank or any
of  its   affiliates   (as  the  term   "affiliate"  is  defined  in  12  U.S.C.
ss.371c(b)(1)),  or a family member of any such person.  Upon  appointment,  the
names of the members of the  Compliance  Committee and, in the event of a change
of the  membership,  the name of any new member shall be submitted in writing to
the Assistant Deputy Comptroller.  The Compliance Committee shall be responsible
for monitoring and  coordinating  the Bank's adherence to the provisions of this
Agreement.

      The Compliance Committee shall meet at least monthly.

      Within thirty days (30) of the appointment of the Compliance Committee and
quarterly  thereafter,  the Compliance Committee shall submit a written progress
report to the Board setting forth in detail:

            (a) actions taken to comply with each Article of this Agreement;

            (b) the results and status of those actions; and

            (c) a description of the actions  needed to achieve full  compliance
            with each Article of this Agreement.

      The Board shall forward a copy of the Compliance  Committee's report, with
any additional comments by the Board, to the Assistant Deputy Comptroller.

                                   Article III
                            LOAN PORTFOLIO MANAGEMENT
                            -------------------------

      (1) The Board shall,  within  ninety (90) days,  develop,  implement,  and
thereafter ensure Bank adherence to a written program to improve the Bank's loan
portfolio management. The program shall include, but not be limited to:

            (a)  procedures  to ensure  satisfactory  and  perfected  collateral
            documentation;

            (b) an  appraisal  review  process  which  includes  the  review and
            testing of assumptions;

            (c) procedures to ensure that  extensions of credit are granted,  by
            renewal or  otherwise,  to any  borrower  only after  obtaining  and
            analyzing current and satisfactory credit information;

            (d)   procedures   to  ensure   conformance   with   loan   approval
            requirements;

            (e) a system to track and analyze exceptions;

                                       2
<PAGE>

            (f)  procedures  to  ensure  the  accuracy  of  internal  management
            information systems;

            (g)  procedures  to ensure loan files are  maintained  with the most
            current information;

            (h) procedures to ensure annual review of credit relationships above
            $500 thousand dollars;

            (i)  a  performance   appraisal   process,   including   performance
            appraisals  and job  descriptions  which  adequately  consider their
            performance relative to policy compliance,  documentation standards,
            accuracy in credit grading,  and other loan administration  matters;
            and

            (j)  procedures  to track  and  analyze  concentrations  of  credit,
            significant  economic  factors,  and  general  conditions  and their
            impact  on  the  credit   quality  of  the  Bank's  loan  and  lease
            portfolios.

      (2) Upon  completion,  a copy of the  program  shall be  forwarded  to the
Assistant Deputy Comptroller.

      (3) Within  ninety (90) days,  the Board  shall  develop,  implement,  and
thereafter  ensure  Bank  adherence  to  systems  which  provide  for  effective
monitoring of:

            (a)  early  problem  loan   identification   to  assure  the  timely
            identification  and  rating of loans  and  leases  based on  lending
            officer submissions;

            (b)  statistical  records that will serve as a basis for identifying
            sources of problem loans and leases by industry,  size,  collateral,
            division,  group, indirect dealer, and individual lending officer or
            any other relevant measure;

            (c) compliance with the Bank's lending policies and laws, rules, and
            regulations pertaining to the Bank's lending function;

            (d) adequacy of credit and collateral documentation; and

            (e) concentrations of credit.

      (4) Beginning June 30, 2009, on a quarterly basis  management will provide
the  Board  with  written  reports  including,   at  a  minimum,  the  following
information:

            (a) the  identification,  type,  rating, and amount of problem loans
            and leases;

            (b) the identification and amount of delinquent loans and leases;

                                       3
<PAGE>

            (c)  credit  and  collateral   documentation,   including  financial
            statement, exceptions;

            (d) the  identification  and status of credit related  violations of
            law, rule or regulation;

            (e) the  identity  of the loan  officer  who  originated  each  loan
            reported in accordance  with  subparagraphs  (a) through (d) of this
            Article and Paragraph;

            (f) an analysis of  concentrations of credit,  significant  economic
            factors,  and  general  conditions  and their  impact on the  credit
            quality of the Bank's loan and lease portfolios; and

            (g) the  identification  of loans and leases not in conformance with
            the  Bank's  lending  and  leasing  policies,  including  applicable
            underwriting  guidelines,  and  exceptions to the Bank's lending and
            leasing policies.

      (5) The Board shall  ensure that the Bank has  processes,  personnel,  and
control  systems to ensure  implementation  of and  adherence to the program and
systems developed pursuant to this Article.

                                   Article IV
                        CREDIT AND COLLATERAL EXCEPTIONS
                        --------------------------------

      (1)  Within  ninety  (90)  days,   the  Board  shall  obtain  current  and
satisfactory credit information on all loans lacking such information, including
those  listed  in the ROE,  in any  subsequent  Report  of  Examination,  in any
internal or external  loan  review,  or in any  listings of loans  lacking  such
information  provided  to  management  by the  National  Bank  Examiners  at the
conclusion of an examination.

      (2) Effective  immediately,  the Bank may grant,  extend,  renew, alter or
restructure any loan or other extension of credit only after:

            (a)  documenting the specific reason or purpose for the extension of
            credit;

            (b) identifying the expected source of repayment in writing;

            (c)  structuring  the repayment  terms to coincide with the expected
            source of repayment;

            (d)  obtaining  and  analyzing   current  and  satisfactory   credit
            information,  including  cash flow  analysis,  where loans are to be
            repaid from operations;

                        (i)   Failure to obtain the  information in (3)(d) shall
                              require  a  majority  of  the  full  Board  (or  a
                              delegated committee thereof) to certify in writing
                              the specific  reasons why  obtaining and analyzing
                              the  information in (3)(d) would be detrimental to
                              the best interests of the Bank.

                                       4
<PAGE>

                        (ii)  A  copy  of  the  Board   certification  shall  be
                              maintained  in the  credit  file  of the  affected
                              borrower(s). The certification will be reviewed by
                              this  Office  in  subsequent  examinations  of the
                              Bank; and

            (d) documenting,  with adequate  supporting  material,  the value of
            collateral  and  properly  perfecting  the  Bank's  lien on it where
            applicable.

                                    Article V
                                 LENDING POLICY
                                 --------------

      (1) Within ninety (90) days,  the Board shall review and revise the Bank's
written loan  policy.  In revising  this policy,  the Board shall refer to "Loan
Portfolio Management" booklet of the Comptroller's  Handbook.  This policy shall
                                     -----------------------
incorporate, but not necessarily be limited to, the following:

            (a) a provision  that current and  satisfactory  credit  information
            will be obtained and maintained on each borrower;

            (b) maximum  ratio of loan value to appraised  value or  acquisition
            costs of collateral  securing the loan, which limits will not exceed
            supervisory loan-to-value limits;

            (c) distribution of loans by category;

            (d) guidelines and limitations on concentrations of credit;

            (e) a  limitation  on the type and size of loans that may be made by
            loan  officers  without  prior  approval by the Board or a committee
            established by the Board for this purpose;

            (f)  measures  to correct  the  deficiencies  in the Bank's  lending
            procedures  noted in any Report of  Examination  including,  but not
            limited to,  participations,  concentrations  limits, and other real
            estate owned;

            (g)  requirement  that all  credits  which  deviate  from the Bank's
            normal course of business,  including all credits which deviate from
            the Bank's  written  Loan Policy  receive the prior  approval of the
            Board, or a committee thereof;

            (h)  guidelines for periodic  review of the Bank's  adherence to the
            revised lending policy; and

            (i)  guidelines  for the  periodic  aggregation  and review of loans
            granted in exception to the loan policy.

      (2) Upon  adoption,  the  policy  shall be  implemented,  the Board  shall
thereafter  ensure Bank adherence to the policy,  and a copy of the policy shall
be forwarded to the Assistant Deputy Comptroller for review.

                                       5
<PAGE>

      (3) The Board shall  ensure that the Bank has  processes,  personnel,  and
control  systems  to  ensure  implementation  of and  adherence  to  the  policy
developed pursuant to this Article.

                                   Article VI
                       ALLOWANCE FOR LOAN AND LEASE LOSSES
                       -----------------------------------

      (1) The Board shall enhance its  methodology to ensure the adequacy of the
Bank's Allowance for Loan and Lease Losses ("Allowance"). This methodology shall
focus particular attention on, but not be limited to, the following factors:

            (a)  establishment of criteria for individual loan impairments under
            FAS  114  and  implement   into  the   Allowance   process  this  is
            inconsistent with the CRE SRC discussion);

            (b)  establishment  of  separate  FAS 5 pools for each  risk  rating
            category;

            (c) validation of the methodology by an independent third party; and

            (d) update the Allowance policy to include all items listed above.

      (2)  Written  documentation  shall be  maintained  indicating  the factors
considered and  conclusions  reached by the Board in determining the adequacy of
the Allowance.

      (3) The Board shall  ensure that the Bank has  processes,  personnel,  and
control  systems  to  ensure  implementation  of and  adherence  to the  program
developed pursuant to this Article.

                                   Article VII
                                 INTERNAL AUDIT
                                 --------------

      (1)  Within  sixty  (60)  days,  the Board  shall  adopt,  implement,  and
thereafter  ensure Bank  adherence to an  independent,  internal  audit  program
sufficient to:

            (a)  detect   irregularities   and  weak  practices  in  the  Bank's
            operations;

            (b)  determine the Bank's level of  compliance  with all  applicable
            laws, rules and regulations;

            (c) adequately cover all areas; in particular a risk-based  approach
            to OFAC and Bank Secrecy Act compliance that includes  transactional
            testing  and  verification  of  data  for  higher-risk  accounts  or
            geographic areas of specific concern; and

            (d)  establish  an annual  audit plan  using a risk  based  approach
            sufficient to achieve these objectives.

                                       6
<PAGE>

      (2) As part of this audit  program,  the Board  shall  evaluate  the audit
reports of any party providing services to the Bank, and shall assess the impact
on the Bank of any audit deficiencies cited in such reports.

      (3) The Board shall  ensure that the Bank has  processes,  personnel,  and
control  systems  to  ensure  implementation  of and  adherence  to the  program
developed pursuant to this Article.

      (4) The Board shall  ensure that the audit  function  is  supported  by an
adequately  staffed  department  or  outside  firm,  with  respect  to both  the
experience level and number of the individuals employed.

      (5) The Board, or a designated  committee of the Board,  shall ensure that
the Bank has processes,  personnel, and control systems to ensure implementation
of, and adherence to, the program developed pursuant to this Article.

      (6) Upon adoption,  a copy of the internal audit program shall be promptly
submitted to the Assistant Deputy Comptroller.

                                  Article VIII
                             CAPITAL AND PROFIT PLAN
                             -----------------------

      (1) Within  ninety (90) days,  the Board  shall  develop,  implement,  and
thereafter ensure Bank adherence to a three year capital plan. The program shall
include:

            (a) specific plans for the maintenance of adequate capital;

            (b)  projections  for growth and capital  requirements  based upon a
            detailed analysis of the Bank's assets, liabilities, earnings, fixed
            assets, and off-balance sheet activities;

            (c)  projections of the sources and timing of additional  capital to
            meet the Bank's current and future needs;

            (d) the primary  source(s)  from which the Bank will  strengthen its
            capital structure to meet the Bank's needs;

            (e) contingency plans that identify  alternative  methods should the
            primary source(s) under (d) above not be available; and

            (f) a dividend  policy that  permits the  declaration  of a dividend
            only:

                        (i)   when the Bank is in  compliance  with its approved
                              capital program;

                        (ii)  when  the  Bank is in  compliance  with 12  U.S.C.
                              ss.ss. 56 and 60.

                                       7
<PAGE>

      (2) Within (90) days, the Board shall develop,  implement,  and thereafter
ensure  Bank  adherence  to a written  profit  plan to improve  and  sustain the
earnings  of the Bank.  This plan  shall  include,  at  minimum,  the  following
elements:

            (a)  identification  of the  major  areas in and  means by which the
            Board will seek to improve the Bank's operating performance;

            (b) realistic and comprehensive budgets, including projected balance
            sheets and year-end income statements;

            (c) a budget  review  process to monitor both the Bank's  income and
            expenses, and to compare actual figures with budgetary projections;

            (d)  identification  of the sources of funding,  including limits on
            specific  types of  wholesale  funding.  The bank shall not exceed a
            maximum ten percent (10%) of brokered  deposits to total deposits as
            per the bank's  existing  policy limit,  except for CDRS deposits in
            existence  on March  31,  2009,  which,  when  combined  with  other
            brokered  deposits,  shall not exceed fifteen percent (15%) of total
            deposits. Any deviation from this limit must be presented in writing
            from the Board to the Assistant Deputy Comptroller for approval.

            (e) a description of the operating  assumptions  that form the basis
            for major projected income and expense components.

      (3) The budgets and related documents  required in paragraph (2) above for
2009 shall be submitted to the Assistant Deputy Comptroller upon completion. The
Board  shall  submit to the  Assistant  Deputy  Comptroller  annual  budgets  as
described in paragraph (3) above for each year this Agreement remains in effect.
The budget for each year shall be  submitted  on or before  November  30, of the
preceding year.

      (4) The Board shall  forward  comparisons  of its balance sheet and profit
and loss  statement  to the profit  plan  projections  to the  Assistant  Deputy
Comptroller on a quarterly basis.

      (5) The Board shall  ensure that the Bank has  processes,  personnel,  and
control systems to ensure  implementation of and adherence to the plan developed
pursuant to this Article.

                                   Article IX
                         CONSUMER COMPLIANCE/BSA PROGRAM
                         -------------------------------

      (1)  Within  sixty  (60)  days,  the Board  shall  adopt,  implement,  and
thereafter  ensure  adherence  to  a  written  consumer  compliance/BSA  program
designed to ensure that the Bank is operating in compliance  with all applicable
consumer protection laws, rules and regulations. This program shall include, but
not be limited to:

            (a) a written description of the duties and  responsibilities of the
            compliance/BSA officer;

            (b) adequate  internal  controls to ensure  compliance with consumer
            protection laws, rules, and regulations;

                                       8
<PAGE>

            (c) the education and training of all appropriate  Bank personnel in
            the requirements of all federal and state consumer  protection laws,
            rules and regulations; and

            (d) periodic  reporting  of the results of the  consumer  compliance
            review to the Board or a committee thereof.

      (2) The Board shall ensure that the program is supported by an  adequately
staffed  department or outside firm,  with respect to both the experience  level
and number of the individuals employed.

      (3) The Board shall  ensure that the Bank has  processes,  personnel,  and
control  systems  to  ensure  implementation  of and  adherence  to the  program
developed pursuant to this Article.

      (4)  Upon  adoption,  a copy of the  program  shall  be  forwarded  to the
Assistant Deputy Comptroller for review.

                                    Article X
                            CONTINGENCY FUNDING PLAN
                            ------------------------

      (1)  Within  sixty  (60) days of the  date,  the Board  shall  expand  and
document the bank's contingency funding plan (CFP). The plan shall provide for a
coordinated strategy and, at a minimum, address:

            (a) identification of liquidity event triggers for CFP purposes;

            (b) crisis  liquidity  scenarios,  including  which funding  sources
            would be available under various circumstances;

            (c) projected sources and uses under stressed scenarios.  Management
            should identify and rank all prospective funding sources, both asset
            and  liabilities,  including  all  rate  sensitive  and  insensitive
            funding as well as credit sensitive funding; and

            (d) estimated timeframes for accessing funds.

      (2) Upon  adoption,  a copy of the written  plan shall be forwarded to the
Assistant Deputy Comptroller for review.

      (3) The Board,  or a  committee  thereof,  shall  ensure that the Bank has
processes,  personnel,  and  control  systems  to ensure  implementation  of and
adherence to the plan developed pursuant to this Article.

                                       9
<PAGE>

                                   Article XI
                                     CLOSING
                                     -------

      Although  the Board has agreed to submit  certain  programs and reports to
the Assistant Deputy Comptroller for review or prior written determination of no
supervisory objection,  the Board has the ultimate responsibility for proper and
sound management of the Bank.

      It is  expressly  and  clearly  understood  that  if,  at any:  time,  the
Comptroller deems it appropriate in fulfilling the responsibilities  placed upon
him/her by the several  laws of the United  States of America to  undertake  any
action  affecting the Bank,  nothing in this Agreement shall in any way inhibit,
estop, bar, or otherwise prevent the Comptroller from so doing.

      Any time limitations imposed by this Agreement shall begin to run from the
effective  date of this  Agreement.  Such time  requirements  may be extended in
writing  by the  Assistant  Deputy  Comptroller  for  good  cause  upon  written
application by the Board.

      The provisions of this Agreement  shall be effective upon execution by the
parties hereto and its provisions shall continue in full force and effect unless
or until such provisions are amended in writing by mutual consent of the parties
to  the  Agreement  or  excepted,  waived,  or  terminated  in  writing  by  the
Comptroller.

      This  Agreement  is  intended  to be,  and  shall  be  construed  to be, a
supervisory  "written agreement entered into with the agency" as contemplated by
12 U.S.C.  ss.1818(b)(1),  and expressly does not form, and may not be construed
to  form,  a  contract   binding  on  the  Comptroller  or  the  United  States.
Notwithstanding the absence of mutuality of obligation, or of consideration,  or
of a contract, the Comptroller may enforce any of the commitments or obligations
herein undertaken by the Bank under his supervisory powers,  including 12 U.S.C.
ss.1818(b)(1),  and  not  as a  matter  of  contract  law.  The  Bank  expressly
acknowledges  that  neither the Bank nor the  Comptroller  has any  intention to
enter into a contract.  The Bank also expressly  acknowledges that no officer or
employee of the Office of the Comptroller of the Currency has statutory or other
authority  to  bind  the  United  States,  the  U.S.  Treasury  Department,  the
Comptroller,  or any other  federal  bank  regulatory  agency or entity,  or any
officer  or  employee  of any of those  entities  to a  contract  affecting  the
Comptroller's  exercise of his supervisory  responsibilities.  The terms of this
Agreement,   including  this   paragraph,   are  not  subject  to  amendment  or
modification   by  any  extraneous   expression,   prior   agreements  or  prior
arrangements between the parties, whether oral or written.

      IN TESTIMONY WHEREOF, the undersigned,  authorized by the Comptroller, has
hereunto set her hand on behalf of the Comptroller.

/Kristin A. Kiefer/                         June 29, 2009
-----------------------------------         ------------------------------------
Kristin A. Kiefer                           Date
Assistant Deputy Comptroller
New York Metro West

                                       10
<PAGE>

IN TESTIMONY WHEREOF,  the undersigned,  as the duly elected and acting Board of
Directors of the Bank, have hereunto set their hands on behalf of the Bank.

-----------------------------------         ------------------------------------
Douglas Anderson                            Date

/Barbara Bell Coleman/                      June 29, 2009
-----------------------------------         ------------------------------------
Barbara Bell Coleman                        Date

/Eugene Giscombe/                           June 29, 2009
-----------------------------------         ------------------------------------
Eugene Giscombe                             Date

/Louis Prezeau/                             June 29, 2009
-----------------------------------         ------------------------------------
Louis Prezeau                               Date

/Lemar Whigham/                             June 29, 2009
-----------------------------------         ------------------------------------
Lemar Whigham                               Date

/H. O'Niel Williams/                        June 29, 2009
-----------------------------------         ------------------------------------
H. O'Niel Williams                          Date

                                       11

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