Document:

exv10w3

EXHIBIT 10.3

Neither this security nor the securities for which this security is exercisable have been
registered with the Securities and Exchange Commission or the securities commission of any state.
These securities are issued in reliance upon an exemption from registration under the Securities
Act of 1933 (the “Securities Act”), and, accordingly, may not be offered or sold except pursuant to
an effective registration statement under the Securities Act or pursuant to an available exemption
from, or in a transaction not subject to, the registration requirements of the Securities Act and
in accordance with applicable state securities laws as evidenced by a legal opinion of counsel to
the transferor to such effect, the substance of which shall be reasonably acceptable to the
company.

COMMON STOCK PURCHASE WARRANT

To purchase up to 400,000 shares of common stock of

iMEDIA INTERNATIONAL, INC.

Dated: May14, 2008

     This common stock purchase warrant (the “Warrant”) certifies that, for value
received, Sawtooth Properties, LLLP. (the “Holder”), is entitled, upon the terms and subject to the
limitations on exercise and the conditions hereinafter set forth, at any time on or after the date
given above (the “Initial Exercise Date”) and by the close of business on the third anniversary of
the Initial Exercise Date (the “Termination Date”) but not thereafter, to subscribe for and
purchase from iMedia International, Inc., a Delaware corporation (the
“Company”), up to 400,000 shares (the “Warrant Shares”) of common stock, par value $0.001 per share, of the Company (the
“Common Stock”), as calculated based the total investment amount per the related Securities
Purchase Agreement of the same date. The purchase price of one share of Common Stock under this
Warrant is equal to the Exercise Price, as defined in Section 2(a).

1. Definitions. Capitalized terms used and not otherwise defined in this Warrant have the same
meanings ascribed to them in the Securities Purchase Agreement (the “Purchase Agreement”), dated
April 10, 2008, by and between the Company and the Holder as Purchaser.

2. Exercise.

(a) Exercise Price. The exercise price of the Common Stock under this Warrant is $0.225.

(b) Exercise of Warrant. The Holder may exercise the purchase rights represented by this
Warrant at any time from the Initial Exercise Date until 5:00 p.m., Pacific Standard Time,
on the Termination Date by delivering to the Company (i) a duly executed facsimile copy of
the annexed Exercise Notice (attached hereto as Exhibit A) no less than 61 days
prior to the exercise date designated therein, and (ii) no later than 5 Trading Days after
the exercise date designated in the Exercise Notice delivered to the Company, (A) this
Warrant, and (B) payment to the Company of the aggregate Exercise Price for the number of
Warrant Shares being purchased by the Holder in connection with such Exercise Notice (the
“Exercise Amount”). For the purposes hereof, “Trading Day” shall mean any day on which the
New York Stock Exchange is open for trading.

(c) Exercise limitations.

(i) The Holder may not exercise any portion of this Warrant if,
immediately after the Warrant Shares are issued, the Holder (together with the
Holder’s affiliates) would beneficially own a number of shares of Common Stock in
excess of the Beneficial Ownership Limitation (as defined below) . For the purposes
of the foregoing sentence, the number of shares of Common Stock beneficially owned
by the Holder and its affiliates includes the number of shares of Common Stock
issuable upon the exercise of this Warrant, but excludes the number of shares of

 

 

Common Stock that would be issuable upon (i) the Holder’s exercise of the remaining,
unexercised portion of this Warrant and (ii) the Holder’s or its affiliates’
exercise or conversion of the unexercised or nonconverted portion of any other
securities of the Company that the Holder or any of its affiliates own beneficially.
Except as set forth in the foregoing sentence, for the purposes of this Section
2(c), beneficial ownership shall be calculated in accordance with Section 13(d) of
the Securities and Exchange Act of 1934, as amended (the “Exchange Act”). The
“Beneficial Ownership Limitation” shall be 4.99% of the number of shares of
the Common Stock outstanding immediately after giving effect to the issuance of shares of Common
Stock issuable upon exercise of this Warrant. The Holder, upon not
less than 61 days’ prior notice to the Company, may increase or decrease the
Beneficial Ownership Limitation provisions of this Section 2(c)(i) or may waive the
application of the Beneficial Ownership Limitation of this Section 2(c)(i)
altogether until any subsequent election under this Section 2(c)(i). Any such
increase, decrease or waiver will not be effective until the 61st day
after such notice is delivered to the Company and shall only apply to such Holder
and no other Holder. The limitations contained in this paragraph shall apply to a
successor holder of this Warrant.

(ii) The Holder acknowledges that the Company is not representing to the
Holder that the calculation described in Section 2(c) complies with Section 13(d) of
the Exchange Act, and the Holder is solely responsible for any schedules required to
be filed in accordance with the Exchange Act. The determination of whether this
Warrant is exercisable (in relation to other securities owned by the Holder and its
affiliates) is in the sole discretion of the Holder, and the submission of an
Exercise Notice is deemed to be the Holder’s declaration that the Holder has
determined that this Warrant is exercisable as set out in the Exercise Notice and
subject to the limitations in this Section 2(c). The Company is not obliged to
verify or confirm the accuracy of the Holder’s determination.

(iii) For the purposes of this Section 2(c), in determining the number of
outstanding shares of Common Stock, the Holder may rely on the number of outstanding
shares of Common Stock as reflected in the most recent of (A) the latest filed of
the Company’s Form 10-QSB and Form 10-KSB, (B) a public announcement by the Company
stating the number of shares of Common Stock outstanding, or (C) any other notice by
the Company or the Company’s transfer agent stating the number of shares of Common
Stock outstanding. Within two Trading Days of the Holder’s written request to the
Company, the Company shall confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding.

(d) Payment. Payment may be made either in cash or by certified or official bank check
payable to the order of the Company equal to the applicable aggregate Exercise Price for the
number of shares of Common Stock specified in the Exercise Notice (as such exercise number
shall be adjusted to reflect any adjustment in the total number of shares of Common Stock
issuable to the Holder per the terms of this Warrant), and the Holder shall thereupon be
entitled to receive the number of duly authorized, validly issued, fully paid and
non-assessable shares of Common Stock determined as provided herein.

(e) Authorization of Warrant Shares. The Company will issue all Warrant Shares as
duly authorized, validly issued, fully paid and non-assessable, and free from all taxes,
liens and charges (other than taxes in respect of any transfer occurring contemporaneously
with the issue).

(f) Delivery of certificates upon exercise. The Company will instruct its
transfer agent to deliver certificates for Warrant Shares to the Holder to the address
specified by the Holder in the Exercise Notice within 5 Trading Days from the later of (A)
61 days following the Company’s receipt of the Exercise Notice, (B) the Holder’s surrender
of this Warrant, and (C) the Company’s receipt of the Exercise Amount as set out in Section
2(b) (the “Warrant Share Delivery Date”). This Warrant shall be deemed to have been
exercised on the later of (1) the date the Exercise Amount is received by the Company and
(2) 61 days following the Company’s receipt of the Exercise Notice (the “Exercise Date”);
and the Warrant Shares shall be deemed to have been issued, and the Holder shall be deemed
to have become a holder of record of the shares for all purposes, on the Exercise Date.

 

 

(g) Delivery of new Warrants upon exercise. If this Warrant is exercised in part,
the Company, when it instructs its transfer agent to deliver the certificate or certificates
representing Warrant Shares, will deliver to the Holder a new Warrant evidencing the rights
of the Holder to purchase the unpurchased Warrant Shares, identical in all other respects
with this Warrant.

(h) Rescission rights. If the Company fails to instruct its transfer agent to
transmit to the Holder a certificate or certificates representing the Warrant Shares
pursuant to this Section 2(h) by the Warrant Share Delivery Date, then the Holder may
rescind the exercise.

(i) No fractional shares or scrip. No fractional shares or scrip representing
fractional shares may be issued upon the exercise of this Warrant. If the Holder would
otherwise be entitled to fractional shares upon the exercise, the Company will pay a cash
adjustment in respect of the fraction in an amount equal to the fraction multiplied by the
Exercise Price.

(j) Charges, taxes and expenses. The Company will issue certificates for Warrant
Shares in the name of the Holder and will not charge the Holder for any issue or transfer
tax or other incidental expense in respect of the issuance of the certificate.

(k) Closing of books. The Company will not close its stockholder books or records
in any manner that prevents the timely exercise of this Warrant.

3. Certain Adjustments.

(a) Stock dividends and splits. If the Company, at any time while this Warrant is
outstanding, (i) pays a stock dividend or otherwise makes a distribution on shares of its
Common Stock or any other Common Stock equivalent (which, for avoidance of doubt, does not
include any shares of Common Stock issued by the Company pursuant to this Warrant), (ii)
subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by
reclassification of shares of the Common Stock any shares of capital stock of the Company,
then the Exercise Price must be multiplied by a fraction of which the numerator is the
number of shares of Common Stock (excluding treasury shares, if any) outstanding before the
event and of which the denominator is the number of shares of Common Stock outstanding after
the event, and the number of shares issuable upon exercise of this Warrant must be
proportionately adjusted by this fraction. Any adjustment made pursuant to this Section
3(a) is effective immediately after the record date for the determination of stockholders
entitled to receive the dividend or distribution and is effective immediately after the
effective date in the case of a subdivision, combination or reclassification.

(b) Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the
Company merges or consolidates with or into another person, (ii) the Company sells all or
substantially all of its assets in one or a series of related transactions, (iii) any person
completes a tender offer or exchange offer by which holders of Common Stock are permitted to
tender or exchange their shares for other securities, cash or property, or (iv) the Company
reclassifies its Common Stock or completes any compulsory share exchange pursuant to which
the Common Stock is effectively converted into or exchanged for other securities, cash or
property (any such case, a “Fundamental Transaction”), then, upon any subsequent conversion
of this Warrant, the Holder shall have the right to receive, for each Warrant Share that
would have been issued upon the exercise absent the Fundamental Transaction, the same
consideration as the Company has given its other holders of its Common Stock for the
conversion of their Common Stock outstanding at the time of the Fundamental Transaction (the
“Alternate Consideration”). Any successor to the Company or surviving entity in a
Fundamental Transaction must issue to the Holder a new warrant consistent with the foregoing
provisions with evidence of the Holder’s right to exercise the warrant into Alternate
Consideration. The terms of any agreement pursuant to which a Fundamental Transaction is
completed must include terms requiring the successor or surviving entity to comply with the
provisions of this Section 3(b) and ensuring that this Warrant (or any replacement security)
is similarly adjusted upon any subsequent transaction analogous to a Fundamental
Transaction.

 

 

(c) Calculations. All calculations under this Section 3 must be made to the nearest cent or
the nearest 1/100th of a share, as the case may be. The number of shares of
Common Stock outstanding at any given time does not include shares of Common Stock owned or
held by or for the account of the Company. For the purposes of this Section 3, the number
of shares of Common Stock deemed to be issued and outstanding as of a given date is the sum
of the number of shares of Common Stock (excluding treasury shares, if any) issued and
outstanding.

(d) Notice to Holders. If the Company makes adjustments under this Section 3, the Company
will promptly mail to the Holder a notice containing a description of the event that
required the adjustment. If the Company proposes any transaction that affects the rights of
the holders of its Common Stock, then the Company will notify the Holder of the proposal at
least twenty days before the record date set for the transaction.

4. Warrant register. The Company will register this Warrant on its warrant register and will treat
the registered Holder as the absolute owner for all purposes.

5. Miscellaneous.

(a) Assignment; Exchange of Warrant. Subject to compliance with applicable securities laws,
this Warrant, and the rights evidenced hereby, may be transferred by any registered holder
hereof (a “Transferor”). On the surrender for exchange of this Warrant, with the
Transferor’s endorsement in the form of Exhibit B attached hereto (the “Transferor
Endorsement Form”) and together with an opinion of counsel reasonably satisfactory to the
Company to the effect that the transfer of this Warrant will be in compliance with
applicable securities laws, the Company at its expense, but with payment by the Transferor
of any applicable transfer taxes, will issue and deliver to or on the order of the
Transferor thereof a new Warrant or Warrants of like tenor, in the name of the Transferor
and/or the transferee(s) specified in such Transferor Endorsement Form (each a
“Transferee”), calling in the aggregate on the face or faces thereof for the number of shares of Common Stock
called for on the face or faces of the Warrant so surrendered by the
Transferor. No such transfers shall result in a public distribution of the Warrant.

(b) No rights as shareholder until Exercise Date. This Warrant does not entitle the Holder
to any voting rights or other rights as a shareholder of the Company before the Exercise
Date. Upon the surrender of this Warrant and the payment of the aggregate Exercise Price,
the Company will issue the Warrant Shares to the Holder as the record owner of the Warrant
Shares as of the close of business on the Exercise Date.

(c) Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant or any stock certificate relating to the Warrant Shares, and, in case of loss, theft
or destruction, of indemnity or security reasonably satisfactory to it, and upon surrender
and cancellation of the Warrant or stock certificate, if mutilated, the Company will make
and deliver a new Warrant or stock certificate of like tenor and dated as of the
cancellation, in lieu of the Warrant or stock certificate.

(d) Saturdays, Sundays, Holidays. If the last date for taking any action under this Warrant
falls on a Saturday, Sunday or a legal holiday, then the action may be taken on the next
succeeding Trading Day.

(e) Authorized Shares.

(i) While the Warrant is outstanding, the Company will reserve from its authorized
and unissued Common Stock a sufficient number of shares to provide for the issuance
of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant constitutes full
authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for the Warrant Shares
upon the exercise of the purchase rights under this Warrant. The Company will take
all such reasonable action as may be necessary to assure that the Warrant Shares are
issued as

 

 

provided without a violation of any applicable law or regulation or of any
requirements of the trading market upon which the Common Stock may be listed or
quoted.

(ii) Unless waived or consented to by the Holder, the Company will not by any action
avoid or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in carrying out all of its terms
and take whatever action is necessary or appropriate to protect the rights of the
Holder under this Warrant from impairment.

(f) Jurisdiction. All questions concerning the construction, validity, enforcement and
interpretation of this Warrant will be determined in accordance with the provisions of the
Purchase Agreement.

(g) Restrictions. The Holder acknowledges that the Holder’s sale or transfer of the Warrant
Shares, if not registered, will be subject to restrictions upon resale imposed by state and
federal securities laws.

(h) No waiver. No course of dealing or any delay or failure to exercise any right hereunder
on the part of the Holder will operate as a waiver of the right or otherwise prejudices the
Holder’s rights, powers or remedies.

(i) Notice. Any notice, request or other document required or permitted to be given or
delivered by either party to the other must be delivered in accordance with the notice
provisions of the Purchase Agreement.

(j) Successors and Assigns. Subject to applicable securities laws, this Warrant inures to
the benefit of and binds the successors and permitted assigns of the Company and the Holder.

(k) Amendment. Any amendment of this Warrant must be in writing and signed by both the
Company and the Holder.

(l) Severability. Wherever possible, each provision of this Warrant will be interpreted
under applicable law, but if any provision of this Warrant is prohibited by or invalid under
applicable law, the provision will be ineffective to the extent of the prohibition or
invalidity without invalidating the remaining provisions of this Warrant.

(m) Headings. The headings used in this Warrant are for the convenience of reference only
and are not, for any purpose, deemed a part of this Warrant.

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

Dated: May 14, 2008

	 	 	 	 	 
	 	iMEDIA INTERNATIONAL, INC.

 	 
	 	By:  	/s/ HENRY D. WILLIAMSON
 	 
	 	 	Name:  	Henry D. Williamson 	 
	 	 	Title:  	Chief Executive Officer 	 

 

 

	 	 	 	 	 

EXHIBIT A

EXERCISE NOTICE

(To be signed only upon exercise of Warrant)

TO: iMedia International, Inc.

The undersigned, pursuant to the provisions set forth in the attached Warrant, hereby
irrevocably elects to purchase                      shares of the Common Stock covered by such Warrant on
                    , which date shall be no earlier than 61 days after the date on which this
Exercise Notice is delivered to the Company.

The undersigned herewith makes payment of the full Exercise Price for such shares at the price
per share provided for in such Warrant, which is an aggregate of $                    , in
lawful money of the United States.

The undersigned requests that the certificates for such shares be issued in the name of, and
delivered to                                                                                                     

whose address is                                                             .

The undersigned represents and warrants that all offers and sales by the undersigned of the
securities issuable upon exercise of the within Warrant shall be made pursuant to registration
of the Common Stock under the Securities Act of 1933, as amended (the “Securities Act”), or
pursuant to an exemption from registration under the Securities Act.

	 	 	 	 	 	 
	Dated:
	 	 	 	 
	 

	 	 
	 	 
	 

	 	 	 	(Signature must conform to name of holder

as specified on the face of the Warrant)

 

 

EXHIBIT B

FORM OF TRANSFEROR ENDORSEMENT

(To be signed only upon transfer of Warrant)

     For value received, the undersigned hereby sells, assigns, and transfers unto the
person(s) named below under the heading “Transferees” the right represented by the within
Warrant to purchase the percentage and number of shares of Common Stock of iMEDIA
INTERNATIONAL, INC. to which the within Warrant relates specified under the headings
“Percentage Transferred” and “Number Transferred,” respectively, opposite the name(s) of such
person(s) and appoints each such person Attorney to transfer its respective right on the books
of iMEDIA INTERNATIONAL, INC. with full power of substitution in the premises.

	 	 	 	 	 
	Transferees	 	Percentage Transferred	 	Number Transferred
	 
	 	 
	 	 

	 	 	 	 	 	 	 	 	 	 	 
	Dated:
	 	 	, 	 	 	 	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 	

	 

	 	 	 	 	 	 	 	 	 	(Signature must conform to name of
holder as specified on the face of the
arrant)

	 
	 	 	 	 	 	 	 	 	 	 
	Signed in the presence of:	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	(Name) 	 	 	 	(address) 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	ACCEPTED AND AGREED:	 	 	 	 
	[TRANSFEREE]	 	 	 	 
	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 
	(Name)
	 	 	 	(address)EX-4.1

Exhibit 4.1

WARRANT TO PURCHASE COMMON STOCK

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

WARRANT

to purchase

35,244,361

Shares of Common Stock

of KeyCorp

Issue Date: November 14, 2008

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

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

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

 

 

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

2

 

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

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

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

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

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

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

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

3

 

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

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

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

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

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

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

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

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

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

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

4

 

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

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

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

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

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

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

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

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

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

5

 

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

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

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

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

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

     8. Transfer/Assignment.

6

 

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

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

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

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

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

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

7

 

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

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

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

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

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

8

 

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

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

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

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

9

 

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

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

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

10

 

consummation of such Business Combination, if the holders of Common Stock have the right to
elect the kind or amount of consideration receivable upon consummation of such Business
Combination, then the consideration that the Warrantholder shall be entitled to receive upon
exercise shall be deemed to be the types and amounts of consideration received by the majority of
all holders of the shares of common stock that affirmatively make an election (or of all such
holders if none make an election).

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

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

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

     (I) Other Events. For so long as the Original Warrantholder holds this Warrant or any
portion thereof, if any event occurs as to which the provisions of this Section 13 are not strictly
applicable or, if strictly applicable, would not, in the good faith judgment of the Board of
Directors of the Company, fairly and adequately protect the purchase rights of the Warrants in
accordance with the essential intent and principles of such provisions, then the Board of

11

 

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

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

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

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

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

     14. Exchange. At any time following the date on which the shares of Common Stock of
the Company are no longer listed or admitted to trading on a national securities exchange (other
than in connection with any Business Combination), the Original Warrantholder may

12

 

cause the Company to exchange all or a portion of this Warrant for an economic interest (to be
determined by the Original Warrantholder after consultation with the Company) of the Company
classified as permanent equity under U.S. GAAP having a value equal to the Fair Market Value of the
portion of the Warrant so exchanged. The Original Warrantholder shall calculate any Fair Market
Value required to be calculated pursuant to this Section 14, which shall not be subject to the
Appraisal Procedure.

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

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

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

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

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

     20. Notices. Any notice, request, instruction or other document to be given hereunder
by any party to the other will be in writing and will be deemed to have been duly given (a) on the
date of delivery if delivered personally, or by facsimile, upon confirmation of receipt, or (b) on
the second business day following the date of dispatch if delivered by a recognized next day
courier service. All notices hereunder shall be delivered as set forth in Item 8 of Schedule A

13

 

hereto, or pursuant to such other instructions as may be designated in writing by the party to
receive such notice.

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

[Remainder of page intentionally left blank]

14

 

[Form of Notice of Exercise]

Date:                     

TO: KeyCorp

RE: Election to Purchase Common Stock

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

Number of Shares of Common Stock                                         

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

Aggregate Exercise Price:                                         

	 	 	 	 	 
	 	Holder:
 	 	 
	 	 	 	 	 
	 	By: 	
 	 
	 	Name: 	
 	 
	 	Title: 	
 	 

15

 

	 	 	 	 	 

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

Dated: November 142008

	 	 	 	 	 
	 	KEYCORP

 	 
	 	By:  	/s/ Joseph M. Vayda
 	 
	 	 	Name:  	Joseph M. Vayda 	 
	 	 	Title:  	Executive Vice President and Treasurer 	 
	 
	 	Attest:

 	 
	 	By:  	/s/ Steven N. Bulloch
 	 
	 	 	Name:  	Steven N. Bulloch 	 
	 	 	Title:  	Assistant Secretary	 

[Signature Page to Warrant]

16

 

SCHEDULE A

UST Sequence Number: 30

Item 1

Name: KeyCorp

Corporate or other organizational form: Corporation

Jurisdiction of organization: Ohio

Item 2 

Exercise Price: $10.64

Item 3

Issue Date: November 14, 2008

Item 4

Amount of last dividend declared prior to the Issue Date: $0.1875

Item 5

Date of Letter Agreement between the Company and the United States Department of the 
Treasury:
November 14, 2008

Item 6

Number of shares of Common Stock: 35,244,361

Item 7

Company’s address: 127 Public Square, Cleveland, OH 44114

Item 8

Notice information:

If to the Company:

KeyCorp

127 Public Square

Cleveland, OH 44114

Attention: Thomas C. Stevens

Telephone: (216) 689-3196

Facsimile: (216) 689-7827

Attention: Paul N. Harris

Telephone: (216) 689-0350

Facsimile: (216) 689-0848

 

 

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street

New York, New York 10004

Attention: Mitchell S. Eitel

                 Andrew R. Gladin

Facsimile: (212) 558-3588

If to the Warrantholder:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00150-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00150-of-00352.parquet"}]]