Dear Ladies and Gentlemen:

 

 

 

 

 

 

 

 

 

	UNITED STATES DEPARTMENT OF THE TREASURY
	By:	/s/ Neel Kashkari
		Name: Neel Kashkari
		Title: Interim Assistant Secretary for Financial Stability

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capitalization Date:

December 31, 2008

 

 

Par value:	None
Total Authorized:	30,000,000
Outstanding:	2,473,739
Subject to warrants, options, convertible securities, etc.:	165,734
Reserved for benefit plans and other issuances:
Remaining authorized but unissued:
Shares issued after Capitalization Date (other than pursuant to warrants, options, convertible securities, etc. as set forth above):	none

 

Par value:	None
Total Authorized:	10,000,000 (30,000 designated as Series A)
Outstanding (by series):	None
Reserved for issuance:	30,000 (Series A)
Remaining authorized but unissued:	10,000,000

 

 

Holders of 5% or more of any class of capital stock		Primary Address
The Banc Fund Company, LLC (201,989 shares of common stock (approximately 8.6% of outstanding shares of common stock))		208 South LaSalle Street Chicago, Illinois 60604
Wellington Management Company, LLP (182,609 shares of common stock (approximately 7.8% of outstanding common stock))		75 State Street Boston, Massachusetts 02109

 

 

 

 

 

 

 

 

 

 

If none, please so indicate by checking the box:   ý .

 

 

 

 

 

 

 

 

 

EXHIBIT A

(Non-Exchange-Traded QFIs, excluding S Corps

and Mutual Organizations)

ARTICLE I
PURCHASE; CLOSING
1.1.	Purchase		4
1.2.	Closing		5
1.3.	Interpretation		7
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
2.1.	Disclosure		7
2.2.	Representations and Warranties of the Company		8
ARTICLE III.
COVENANTS
3.1.	Commercially Reasonable Efforts		15
3.2.	Expenses		16
3.3.	Sufficiency of Authorized Warrant Preferred Stock; Exchange Listing		16
3.4.	Certain Notifications Until Closing		16
3.5.	Access, Information and Confidentiality		16
ARTICLE IV.
ADDITIONAL AGREEMENTS
4.1.	Purchase for Investment		18
4.2.	Legends		18
4.3.	Certain Transactions		20
4.4.	Transfer of Purchased Securities and Warrant Shares; Restrictions on Exercise of the Warrant		20
4.5.	Registration Rights		20
4.6.	Depositary Shares		31
4.7.	Restriction on Dividends and Repurchases		32
4.8.	Executive Compensation		34
4.9.	Related Party Transactions		34
4.10.	Bank and Thrift Holding Company Status		34
4.11.	Predominantly Financial		34

ARTICLE V.
MISCELLANEOUS
5.1.	Termination		35
5.2.	Survival of Representations and Warranties		35
5.3.	Amendment		35
5.4.	Waiver of Conditions		35
5.5.	Governing Law: Submission to Jurisdiction, Etc		35
5.6.	Notices		36

 

5.7.	Definitions		36
5.8.	Assignment		37
5.9.	Severability		37
5.10.	No Third Party Beneficiaries		37

 

 

LIST OF ANNEXES

 

 

INDEX OF DEFINED TERMS

Term		Location of Definition
Affiliate		5.7(b)
Agreement		Recitals
Appropriate Federal Banking Agency		2.2(s)
Bank Holding Company		4.10
Bankruptcy Exceptions		2.2(d)
Benefit Plans		1 .2(d)(iv)
Board of Directors		2.2(f)
Business Combination		5.8
business day		1.3
Capitalization Date		2.2(b)
Certificates of Designations		1.2(d) (iii)
Charter		1 .2(d)(iii)
Closing		1.2(a)
Closing Date		1.2(a)
Code		2.2(n)
Common Stock		2.2(b)
Company		Recitals
Company Financial Statements		2.2(h)
Company Material Adverse Effect		2.1(b)
Company Reports		2.2(i)(i)
Company Subsidiary; Company Subsidiaries		2.2(e)(ii)
control; controlled by; under common control with		5.7(b)
Controlled Group		2.2(n)
CPP		Recitals
Disclosure Schedule		2.1(a)
EESA		1.2(d)(iv)
ERISA		2.2(n)
Exchange Act		4.4
Federal Reserve		4.10
GAAP		2.1(b)
Governmental Entities		1.2(c)
Holder		4.5(l)(i)
Holders’ Counsel		4.5(l)(ii)
Indemnitee		4. 5(h)(i)
Information		3.5(c)
Investor		Recitals
Junior Stock		4.7(f)
knowledge of the Company; Company’s knowledge		5.7(c)
Letter Agreement		Recitals
officers		5.7(c)
Parity Stock		4.7(f)

Pending Underwritten Offering		4.5(m)
Permitted Repurchases		4.7(c)
Piggyback Registration		4.5(b)(iv)
Plan		2.2(n)
Preferred Shares		Recitals
Preferred Stock		Recitals
Previously Disclosed		2.1(c)
Proprietary Rights		2.2(u)
Purchase		Recitals
Purchase Price		1.1
Purchased Securities		Recitals
register; registered; registration		4.5(l)(iii)
Registrable Securities		4.5(l)(iv)
Registration Expenses		4.5(l)(v)
Regulatory Agreement		2.2(s)
Rule 144; Rule 144A; Rule 159A; Rule 405; Rule 415		4.5(l)(vi)
Savings and Loan Holding Company		4.10
Schedules		Recitals
SEC		2.2(k)
Securities Act		2.2(a)
Selling Expenses		4.5(l)(vii)
Senior Executive Officers		4.8
Shelf Registration Statement		4.5(b)(ii)
Signing Date		2.1(b)
Special Registration		4.5(j)
subsidiary		5.7(a)
Tax; Taxes		2.2(o)
Transfer		4.4
Warrant		Recitals
Warrant Preferred Stock		Recitals
Warrant Shares		2.2(d)

 

 

SECURITIES PURCHASE AGREEMENT – STANDARD TERMS

Recitals:

WHEREAS, the United States Department of the Treasury (the “ Investor ”)   may from time to time agree to purchase shares of preferred stock and warrants from eligible financial institutions which elect to participate in the Troubled Asset Relief Program Capital Purchase Program ( “ CPP ”) ;

 

WHEREAS, an eligible financial institution electing to participate in the CPP and issue securities to the Investor (referred to herein as the “ Company ”)   shall enter into a letter agreement (the “ Letter Agreement ”)   with the Investor which incorporates this Securities Purchase Agreement – Standard Terms;

 

WHEREAS, the Company agrees to expand the flow of credit to U.S. consumers and businesses on competitive terms to promote the sustained growth and vitality of the U.S. economy;

 

WHEREAS, the Company agrees to work diligently, under existing programs, to modify the terms of residential mortgages as appropriate to strengthen the health of the U.S. housing market;

 

WHEREAS, the Company intends to issue in a private placement the number of shares of the series of its Preferred Stock ( “ Preferred Stock ”)   set forth on Schedule A to the Letter Agreement (the “ Preferred Shares ”)   and a warrant to purchase the number of shares of the series of its Preferred Stock ( “ Warrant Preferred Stock ”)   set forth on Schedule A to the Letter Agreement (the “ Warrant ”   and, together with the Preferred Shares, the “ Purchased Securities ”)   and the Investor intends to purchase (the “ Purchase ”)   from the Company the Purchased Securities; and

 

WHEREAS, the Purchase will be governed by this Securities Purchase Agreement – Standard Terms and the Letter Agreement, including the schedules thereto (the “ Schedules ”) , specifying additional terms of the Purchase.  This Securities Purchase Agreement – Standard Terms (including the Annexes hereto) and the Letter Agreement (including the Schedules thereto) are together referred to as this “Agreement”. All references in this Securities Purchase Agreement – Standard Terms to “Schedules” are to the Schedules attached to the Letter Agreement.

 

NOW, THEREFORE, in consideration of the premises, and of the representations, warranties, covenants and agreements set forth herein, the parties agree as follows:

Article I.  

Purchase; Closing

1.1.   Purchase .  On the terms and subject to the conditions set forth in this Agreement, the Company agrees to sell to the Investor, and the Investor agrees to purchase from the Company, at the Closing (as hereinafter defined), the Purchased Securities for the price set forth on Schedule A (the “ Purchase Price ”) .

 

 

1.2.   Closing .

 

(a)   On the terms and subject to the conditions set forth in this Agreement, the closing of the Purchase (the “ Closing ”)   will take place at the location specified in Schedule A , at the time and on the date set forth in Schedule A or as soon as practicable thereafter, or at such other place, time and date as shall be agreed between the Company and the Investor.  The time and date on which the Closing occurs is referred to in this Agreement as the “ Closing Date ” .

 

(b)   Subject to the fulfillment or waiver of the conditions to the Closing in this Section 1.2, at the Closing the Company will deliver the Preferred Shares and the Warrant, in each case as evidenced by one or more certificates dated the Closing Date and bearing appropriate legends as hereinafter provided for, in exchange for payment in full of the Purchase Price by wire transfer of immediately available United States funds to a bank account designated by the Company on Schedule A .

 

(c)   The respective obligations of each of the Investor and the Company to consummate the Purchase are subject to the fulfillment (or waiver by the Investor and the Company, as applicable) prior to the Closing of the conditions that (i) any approvals or authorizations of all United States and other governmental, regulatory or judicial authorities (collectively, “ Governmental Entities ”)   required for the consummation of the Purchase shall have been obtained or made in form and substance reasonably satisfactory to each party and shall be in full force and effect and all waiting periods required by United States and other applicable law, if any, shall have expired and (ii) no provision of any applicable United States or other law and no judgment, injunction, order or decree of any Governmental Entity shall prohibit the purchase and sale of the Purchased Securities as contemplated by this Agreement.

 

(d)   The obligation of the Investor to consummate the Purchase is also subject to the fulfillment (or waiver by the Investor) at or prior to the Closing of each of the following conditions:

 

 

 

 

 

 

 

 

 

1.3.   Interpretation .  When a reference is made in this Agreement to “Recitals,” “Articles,” “Sections,” or “Annexes” such reference shall be to a Recital, Article or Section of, or Annex to, this Securities Purchase Agreement – Standard Terms, and a reference to “Schedules” shall be to a Schedule to the Letter Agreement, in each case, unless otherwise indicated. The terms defined in the singular have a comparable meaning when used in the plural, and vice versa. References to “herein”, “hereof”, “hereunder” and the like refer to this Agreement as a whole and not to any particular section or provision, unless the context requires otherwise. The table of contents and headings contained in this Agreement are for reference purposes only and are not part of this Agreement. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed followed by the words “without limitation.” No rule of construction against the draftsperson shall be applied in connection with the interpretation or enforcement of this Agreement, as this Agreement is the product of negotiation between sophisticated parties advised by counsel. All references to “$” or “dollars” mean the lawful currency of the United States of America. Except as expressly stated in this Agreement, all references to any statute, rule or regulation are to the statute, rule or regulation as amended, modified, supplemented or replaced from time to time (and, in the case of statutes, include any rules and regulations promulgated under the statute) and to any section of any statute, rule or regulation include any successor to the section. References to a “ business day ”   shall mean 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.

Article II.  

Representations and Warranties

(a)   On or prior to the Signing Date, the Company delivered to the Investor a schedule ( “ Disclosure Schedule ”)   setting forth, among other things, items the disclosure of which is necessary or appropriate either in response to an express disclosure requirement contained in a provision hereof or as an exception to one or more representations or warranties contained in Section 2.2.

 

(b)   “ Company Material Adverse Effect ”   means a material adverse effect on (i) the business, results of operation or financial condition of the Company and its consolidated subsidiaries taken as a whole; provided, however, that Company Material Adverse Effect shall not be deemed to include the effects of (A) changes after the date of the Letter Agreement (the “ Signing Date ”)   in general business, economic or market conditions (including changes generally in prevailing interest rates, credit availability and liquidity, currency exchange rates and price levels or trading volumes in the United States or foreign securities or credit markets), or any outbreak or escalation of hostilities, declared or undeclared acts of war or terrorism, in each case generally affecting the industries in which the Company and its subsidiaries operate, (B) changes or proposed changes after the Signing Date in generally accepted accounting principles in the United States ( “ GAAP ”)   or regulatory accounting requirements, or authoritative interpretations thereof, or (C) changes or proposed changes after the Signing Date in securities, banking and other laws of general applicability or related policies or interpretations of Governmental Entities (in the case of each of these clauses (A), (B) and (C), other than changes or occurrences to the extent that

 

 

(c)   “ Previously Disclosed ”   means information set forth on the Disclosure Schedule, provided, however, that disclosure in any section of such Disclosure Schedule shall apply only to the indicated section of this Agreement except to the extent that it is reasonably apparent from the face of such disclosure that such disclosure is relevant to another section of this Agreement.

 

2.2.   Representations and Warranties of the Company .  Except as Previously Disclosed, the Company represents and warrants to the Investor that as of the Signing Date and as of the Closing Date (or such other date specified herein):

 

(a)   Organization, Authority and Significant Subsidiaries .  The Company has been duly incorporated and is validly existing and in good standing under the laws of its jurisdiction of organization, with the necessary power and authority to own its properties and conduct its business in all material respects as currently conducted, and except as has not, individually or in the aggregate, had and would not reasonably be expected to have a Company Material Adverse Effect, has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties or conducts any business so as to require such qualification; each subsidiary of the Company that would be considered a “significant subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X under the Securities Act of 1933 (the “ Securities Act ”),   has been duly organized and is validly existing in good standing under the laws of its jurisdiction of organization. The Charter and bylaws of the Company, copies of which have been provided to the Investor prior to the Signing Date, are true, complete and correct copies of such documents as in full force and effect as of the Signing Date.

 

(b)   Capitalization .  The authorized capital stock of the Company, and the outstanding capital stock of the Company (including securities convertible into, or exercisable or exchangeable for, capital stock of the Company) as of the most recent fiscal month-end preceding the Signing Date (the “ Capitalization Date ”)   is set forth on Schedule B .  The outstanding shares of capital stock of the Company have been duly authorized and are validly issued and outstanding, fully paid and nonassessable, and subject to no preemptive rights (and were not issued in violation of any preemptive rights). As of the Signing Date, the Company does not have outstanding any securities or other obligations providing the holder the right to acquire its Common Stock ( “ Common Stock ”)   that is not reserved for issuance as specified on Schedule B , and the Company has not made any other commitment to authorize, issue or sell any Common Stock. Since the Capitalization Date, the Company has not issued any shares of Common Stock, other than (i) shares issued upon the exercise of stock options or delivered under other equity-based awards or other convertible securities or warrants which were issued and outstanding on the Capitalization Date and disclosed on Schedule B and (ii) shares disclosed on Schedule B .  Each holder of 5% or more of any class of capital stock of the Company and such holder’s primary address are set forth on Schedule B.

 

 

(c)   Preferred Shares .  The Preferred Shares have been duly and validly authorized, and, when issued and delivered pursuant to this Agreement, such Preferred Shares will be duly and validly issued and fully paid and non-assessable, will not be issued in violation of any preemptive rights, and will rank pari passu with or senior to all other series or classes of Preferred Stock, whether or not issued or outstanding, with respect to the payment of dividends and the distribution of assets in the event of any dissolution, liquidation or winding up of the Company.

 

(d)   The Warrant and Warrant Shares .  The Warrant has been duly authorized and, when executed and delivered as contemplated hereby, will constitute a valid and legally binding obligation of the Company enforceable against the Company in accordance with its terms, except as the same may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and general equitable principles, regardless of whether such enforceability is considered in a proceeding at law or in equity ( “ Bankruptcy Exceptions ”) . The shares of Warrant Preferred Stock issuable upon exercise of the Warrant (the “ Warrant Shares ”)   have been duly authorized and reserved for issuance upon exercise of the Warrant and when so issued in accordance with the terms of the Warrant will be validly issued, fully paid and non-assessable, and will rank pari passu with or senior to all other series or classes of Preferred Stock, whether or not issued or outstanding, with respect to the payment of dividends and the distribution of assets in the event of any dissolution, liquidation or winding up of the Company.

 

(e)   Authorization, Enforceability.

 

 

 

 

(f)   Anti-takeover Provisions and Rights Plan .  The Board of Directors of the Company (the “ Board of Directors ”)   has taken all necessary action to ensure that the transactions contemplated by this Agreement and the Warrant and the consummation of the transactions contemplated hereby and thereby, including the exercise of the Warrant in accordance with its terms, will be exempt from any anti-takeover or similar provisions of the Company’s Charter and bylaws, and any other provisions of any applicable “moratorium”, “control share”, “fair price”, “interested stockholder” or other anti-takeover laws and regulations of any jurisdiction.

 

(g)   No Company Material Adverse Effect .  Since the last day of the last completed fiscal period for which financial statements are included in the Company Financial Statements (as defined below), no fact, circumstance, event, change, occurrence, condition or development has occurred that, individually or in the aggregate, has had or would reasonably be expected to have a Company Material Adverse Effect.

 

(h)   Company Financial Statements .  The Company has Previously Disclosed each of the consolidated financial statements of the Company and its consolidated subsidiaries for each of the last three completed fiscal years of the Company (which shall be audited to the extent audited financial statements are available prior to the Signing Date) and each completed quarterly period since the last completed fiscal year (collectively the “ Company Financial Statements ”) . The Company Financial Statements present fairly in all material respects the consolidated financial position of the Company and its consolidated subsidiaries as of the dates indicated therein and the consolidated results of their operations for the periods specified therein; and except as stated therein, such financial statements (A) were prepared in conformity with GAAP applied on a consistent basis (except as may be noted therein) and (B) have been prepared

 

 

(i)   Reports.

 

 

 

(j)   No Undisclosed Liabilities .  Neither the Company nor any of the Company Subsidiaries has any liabilities or obligations of any nature (absolute, accrued, contingent or otherwise) which are not properly reflected or reserved against in the Company Financial Statements to the extent required to be so reflected or reserved against in accordance with GAAP, except for (A) liabilities that have arisen since the last fiscal year end in the ordinary and usual course of business and consistent with past practice and (B) liabilities that, individually or in the aggregate, have not had and would not reasonably be expected to have a Company Material Adverse Effect.

 

(k)   Offering of Securities .  Neither the Company nor any person acting on its behalf has taken any action (including any offering of any securities of the Company under circumstances which would require the integration of such offering with the offering of any of

 

the Purchased Securities under the Securities Act, and the rules and regulations of the Securities and Exchange Commission (the “ SEC ”)   promulgated thereunder), which might subject the offering, issuance or sale of any of the Purchased Securities to Investor pursuant to this Agreement to the registration requirements of the Securities Act.

 

(l)   Litigation and Other Proceedings .  Except (i) as set forth on Schedule C or (ii) as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, there is no (A) pending or, to the knowledge of the Company, threatened, claim, action, suit, investigation or proceeding, against the Company or any Company Subsidiary or to which any of their assets are subject nor is the Company or any Company Subsidiary subject to any order, judgment or decree or (B) unresolved violation, criticism or exception by any Governmental Entity with respect to any report or relating to any examinations or inspections of the Company or any Company Subsidiaries.

 

(m)   Compliance with Laws .  Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, the Company and the Company Subsidiaries have all permits, licenses, franchises, authorizations, orders and approvals of, and have made all filings, applications and registrations with, Governmental Entities that are required in order to permit them to own or lease their properties and assets and to carry on their business as presently conducted and that are material to the business of the Company or such Company Subsidiary. Except as set forth on Schedule D , the Company and the Company Subsidiaries have complied in all respects and are not in default or violation of, and none of them is, to the knowledge of the Company, under investigation with respect to or, to the knowledge of the Company, have been threatened to be charged with or given notice of any violation of, any applicable domestic (federal, state or local) or foreign law, statute, ordinance, license, rule, regulation, policy or guideline, order, demand, writ, injunction, decree or judgment of any Governmental Entity, other than such noncompliance, defaults or violations that would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. Except for statutory or regulatory restrictions of general application or as set forth on Schedule D , no Governmental Entity has placed any restriction on the business or properties of the Company or any Company Subsidiary that would, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

 

(n)   Employee Benefit Matters .  Except as would not reasonably be expected to have, either individually or in the aggregate, a Company Material Adverse Effect: (A) each “employee benefit plan” (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ( “ ERISA ”)   providing benefits to any current or former employee, officer or director of the Company or any member of its “ Controlled Group ”   (defined as any organization which is a member of a controlled group of corporations within the meaning of Section 414 of the Internal Revenue Code of 1986, as amended (the “ Code ”)   that is sponsored, maintained or contributed to by the Company or any member of its Controlled Group and for which the Company or any member of its Controlled Group would have any liability, whether actual or contingent (each, a “ Plan ”)   has been maintained in compliance with its terms and with the requirements of all applicable statutes, rules and regulations, including ERISA and the Code; (B) with respect to each Plan subject to Title IV of ERISA (including, for purposes of this clause (B), any plan subject to Title IV of ERISA that the Company or any member of its Controlled

 

Group previously maintained or contributed to in the six years prior to the Signing Date), (1) no “reportable event” (within the meaning of Section 4043(c) of ERISA), other than a reportable event for which the notice period referred to in Section 4043(c) of ERISA has been waived, has occurred in the three years prior to the Signing Date or is reasonably expected to occur, (2) no “accumulated funding deficiency” (within the meaning of Section 302 of ERISA or Section 412 of the Code), whether or not waived, has occurred in the three years prior to the Signing Date or is reasonably expected to occur, (3) the fair market value of the assets under each Plan exceeds the present value of all benefits accrued under such Plan (determined based on the assumptions used to fund such Plan) and (4) neither the Company nor any member of its Controlled Group has incurred in the six years prior to the Signing Date, or reasonably expects to incur, any liability under Title IV of ERISA (other than contributions to the Plan or premiums to the PBGC in the ordinary course and without default) in respect of a Plan (including any Plan that is a “multiemployer plan”, within the meaning of Section 4001(c)(3) of ERISA); and (C) each Plan that is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service with respect to its qualified status that has not been revoked, or such a determination letter has been timely applied for but not received by the Signing Date, and nothing has occurred, whether by action or by failure to act, which could reasonably be expected to cause the loss, revocation or denial of such qualified status or favorable determination letter.

 

(o)   Taxes .  Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, (i) the Company and the Company Subsidiaries have filed all federal, state, local and foreign income and franchise Tax returns required to be filed through the Signing Date, subject to permitted extensions, and have paid all Taxes due thereon, and (ii) no Tax deficiency has been determined adversely to the Company or any of the Company Subsidiaries, nor does the Company have any knowledge of any Tax deficiencies. “ Tax ”   or “ Taxes ”   means any federal, state, local or foreign income, gross receipts, property, sales, use, license, excise, franchise, employment, payroll, withholding, alternative or add on minimum, ad valorem, transfer or excise tax, or any other tax, custom, duty, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest or penalty, imposed by any Governmental Entity.

 

(p)   Properties and Leases .  Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, the Company and the Company Subsidiaries have good and marketable title to all real properties and all other properties and assets owned by them, in each case free from liens, encumbrances, claims and defects that would affect the value thereof or interfere with the use made or to be made thereof by them. Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, the Company and the Company Subsidiaries hold all leased real or personal property under valid and enforceable leases with no exceptions that would interfere with the use made or to be made thereof by them.

 

(q)   Environmental Liability .  Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect:

 

 

 

 

 

(r)   Risk Management Instruments .  Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, all derivative instruments, including, swaps, caps, floors and option agreements, whether entered into for the Company’s own account, or for the account of one or more of the Company Subsidiaries or its or their customers, were entered into (i) only in the ordinary course of business, (ii) in accordance with prudent practices and in all material respects with all applicable laws, rules, regulations and regulatory policies and (iii) with counterparties believed to be financially responsible at the time; and each of such instruments constitutes the valid and legally binding obligation of the Company or one of the Company Subsidiaries, enforceable in accordance with its terms, except as may be limited by the Bankruptcy Exceptions. Neither the Company or the Company Subsidiaries, nor, to the knowledge of the Company, any other party thereto, is in breach of any of its obligations under any such agreement or arrangement other than such breaches that would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

 

(s)   Agreements with Regulatory Agencies .  Except as set forth on Schedule E , neither the Company nor any Company Subsidiary is subject to any material cease-and-desist or other similar order or enforcement action issued by, or is a party to any material written agreement, consent agreement or memorandum of understanding with, or is a party to any commitment letter or similar undertaking to, or is subject to any capital directive by, or since December 31, 2006, has adopted any board resolutions at the request of, any Governmental Entity (other than the Appropriate Federal Banking Agencies with jurisdiction over the Company and the Company Subsidiaries) that currently restricts in any material respect the conduct of its business or that in any material manner relates to its capital adequacy, its liquidity and funding policies and practices, its ability to pay dividends, its credit, risk management or compliance policies or procedures, its internal controls, its management or its operations or business (each item in this sentence, a “ Regulatory Agreement ”) , nor has the Company or any Company Subsidiary been advised since December 31, 2006 by any such Governmental Entity that it is considering issuing, initiating, ordering, or requesting any such Regulatory Agreement. The Company and each Company Subsidiary are in compliance in all material respects with each Regulatory Agreement to which it is party or subject, and neither the Company nor any Company Subsidiary has received any notice from any Governmental Entity indicating that either the Company or any

 

 

(t)   Insurance .  The Company and the Company Subsidiaries are insured with reputable insurers against such risks and in such amounts as the management of the Company reasonably has determined to be prudent and consistent with industry practice. The Company and the Company Subsidiaries are in material compliance with their insurance policies and are not in default under any of the material terms thereof, each such policy is outstanding and in full force and effect, all premiums and other payments due under any material policy have been paid, and all claims thereunder have been filed in due and timely fashion, except, in each case, as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

 

(u)   Intellectual Property .  Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, (i) the Company and each Company Subsidiary owns or otherwise has the right to use, all intellectual property rights, including all trademarks, trade dress, trade names, service marks, domain names, patents, inventions, trade secrets, know-how, works of authorship and copyrights therein, that are used in the conduct of their existing businesses and all rights relating to the plans, design and specifications of any of its branch facilities ( “ Proprietary Rights ”)   free and clear of all liens and any claims of ownership by current or former employees, contractors, designers or others and (ii) neither the Company nor any of the Company Subsidiaries is materially infringing, diluting, misappropriating or violating, nor has the Company or any or the Company Subsidiaries received any written (or, to the knowledge of the Company, oral) communications alleging that any of them has materially infringed, diluted, misappropriated or violated, any of the Proprietary Rights owned by any other person. Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, to the Company’s knowledge, no other person is infringing, diluting, misappropriating or violating, nor has the Company or any or the Company Subsidiaries sent any written communications since January 1, 2006 alleging that any person has infringed, diluted, misappropriated or violated, any of t