Common use of TARP Exchange Clause in Contracts

TARP Exchange. The United States Department of Treasury (the “Treasury”) holds (i) 135,000 shares of Fixed Rate Cumulative Perpetual Preferred Stock, no par value per share and liquidation preference $1,000 per share (the “TARP Preferred Stock”), and (ii) a warrant, dated January 9, 2009, to purchase 1,585,748 shares of the Common Stock (before giving effect to the Reverse Stock Split or 79,288 shares after giving effect to the Reverse Stock Split) at an exercise price of $12.77 per share (before giving effect to the Reverse Stock Split) (the “TARP Warrant”). Pursuant to an Exchange Agreement to be executed between the Treasury and the Company (the “Exchange Agreement”), (1) (A) the Company intends to issue to the Treasury, in exchange for its 135,000 Preferred Shares and the accrued and unpaid dividends thereon, 5,613,981 shares of Common Stock and, if the Closing shall occur after February 15, 2011, such number of additional Common Shares (rounded to the nearest whole number) that is equal to (x) the amount of all accrued and unpaid dividends on the TARP Preferred Stock from February 16, 2011 through and including the Closing Date, divided by (y) $10.00, and (B) the Treasury intends to deliver to the Company the shares of TARP Preferred Stock in exchange for such shares of Common Stock and (2) the Company and the Treasury intend to amend the TARP Warrant to, among other things, reduce the exercise price thereof to $10.00 per share (after giving effect to the Reverse Stock Split) (collectively, the “TARP Exchange”), each to occur simultaneously with the Closing.”