Exhibit 10.1

 

SUBORDINATED NOTE PURCHASE AGREEMENT

 

This SUBORDINATED NOTE PURCHASE AGREEMENT (this “Agreement”) is dated as of
August 20, 2020, and is made by and among Atlantic Capital Bancshares, Inc., a
Georgia corporation (the “Company”), and the several purchasers of the
Subordinated Notes (as defined herein) identified on the signature pages hereto
(each a “Purchaser” and collectively, the “Purchasers”).

 

RECITALS

 

WHEREAS, the Company is offering up to $75,000,000 in aggregate principal amount
of Subordinated Notes of the Company, which aggregate amount is intended to
qualify as Tier 2 Capital (as defined herein).

 

WHEREAS, the Company has engaged Piper Sandler & Co. as lead placement agent,
and Raymond James & Associates and Performance Trust Capital Partners, LLC as
co-placement agents (collectively, the “Placement Agents”) for the offering of
the Subordinated Notes.

 

WHEREAS, each of the Purchasers is an institutional “accredited investor” as
such term is defined in Rule 501 of Regulation D (“Regulation D”) promulgated
under the Securities Act of 1933, as amended (the “Securities Act”) or a QIB (as
defined herein).

 

WHEREAS, the offer and sale of the Subordinated Notes by the Company is being
made in reliance upon the exemptions from registration available under Section
4(a)(2) of the Securities Act and Rule 506(b) of Regulation D.

 

WHEREAS, each Purchaser is willing to purchase from the Company a Subordinated
Note in the principal amount set forth on such Purchaser’s respective signature
page hereto (each, a “Subordinated Note Amount”) in accordance with the terms,
subject to the conditions and in reliance on, the recitals, representations,
warranties, covenants and agreements set forth herein and in the Subordinated
Notes and in the Indenture (as defined herein).

 

WHEREAS, at Closing, the Company and the Purchasers shall execute and deliver a
Registration Rights Agreement, substantially in the form attached hereto as
Exhibit A (the “Registration Rights Agreement”), pursuant to which, among other
things, the Company will agree to provide certain registration rights with
respect to the Subordinated Notes under the Securities Act and the rules and
regulations promulgated thereunder and applicable state securities laws.

 

NOW, THEREFORE, in consideration of the mutual covenants, conditions and
agreements herein contained and other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, the parties hereto hereby
agree as follows:

 

AGREEMENT

 

1.             DEFINITIONS.

 

1.1         Defined Terms. The following capitalized terms used in this
Agreement have the meanings defined or referenced below. Certain other
capitalized terms used only in specific sections of this Agreement may be
defined in such sections.

 

“Affiliate(s)” means, with respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
“control,” when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms “controlling” and “controlled” have meanings correlative to the
foregoing.

 

 

 

 

“Agreement” has the meaning set forth in the preamble hereto.

 

“Applicable Procedures” means, with respect to any transfer or exchange of or
for beneficial interests in any Subordinated Note represented by a global
certificate, the rules and procedures of DTC (as defined herein) that apply to
such transfer or exchange.

 

“Articles” means the articles of incorporation of the Company, as in effect on
the Closing Date.

 

“Bank” means Atlantic Capital Bank, National Association, a wholly owned
subsidiary of the Company.

 

“Business Day” means any day other than a Saturday, Sunday or any other day on
which banking institutions in the State of Georgia are permitted or required by
any applicable law or executive order to close.

 

“Bylaws” means the bylaws of the Company, as in effect on the Closing Date.

 

“Closing” has the meaning set forth in Section 2.5.

 

“Closing Date” means the date hereof.

 

“Company” has the meaning set forth in the preamble hereto and shall include any
successors to the Company.

 

“Company Covered Person” has the meaning set forth in Section 4.2.4.

 

“Company’s Reports” means (i) the audited financial statements of the Company
for the year ended December 31, 2019, included in the Company’s Annual Report on
Form 10-K for the year ended December 31, 2019, as filed with the SEC; (ii) the
unaudited financial statements of the Company for the quarters ended March 31,
2020 and June 30, 2020, included in the Company’s Quarterly Reports on Form 10-Q
for the quarters ended March 31, 2020 and June 30, 2020, as filed with the SEC;
and (iii) the Company’s reports for the year ended December 31, 2019, and the
quarters ended March 31, 2020 and June 30, 2020, as filed with the FRB as
required by regulations of the FRB.

 

“Disbursement” has the meaning set forth in Section 3.1.

 

“Disqualification Event” has the meaning set forth in Section 4.2.4.

 

“DTC” means The Depository Trust Company.

 

“Equity Interest” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person which is not a corporation, and any
and all warrants, options or other rights to purchase any of the foregoing.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“FDIC” means the Federal Deposit Insurance Corporation.

 

2

 

 

“FRB” means the Board of Governors of the Federal Reserve System.

 

“GAAP” means generally accepted accounting principles in effect from time to
time in the United States of America.

 

“Global Note” has the meaning set forth in Section 3.1.

 

“Governmental Agency(ies)” means, individually or collectively, any federal,
state, county or local governmental department, commission, board, regulatory
authority or agency (including, without limitation, each applicable Regulatory
Agency) with jurisdiction over the Company or a Subsidiary of the Company.

 

“Governmental Licenses” has the meaning set forth in Section 4.3.

 

“Hazardous Materials” means flammable explosives, asbestos, urea formaldehyde
insulation, polychlorinated biphenyls, radioactive materials, hazardous wastes,
toxic or contaminated substances or similar materials, including, without
limitation, any substances which are “hazardous substances,” “hazardous wastes,”
“hazardous materials” or “toxic substances” under the Hazardous Materials Laws
and/or other applicable environmental laws, ordinances or regulations.

 

“Hazardous Materials Laws” mean any laws, regulations, permits, licenses or
requirements pertaining to the protection, preservation, conservation or
regulation of the environment which relates to real property, including: the
Clean Air Act, as amended, 42 U.S.C. Section 7401 et seq.; the Federal Water
Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq.; the Resource
Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901 et
seq.; the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended (including the Superfund Amendments and Reauthorization Act
of 1986), 42 U.S.C. Section 9601 et seq.; the Toxic Substances Control Act, as
amended, 15 U.S.C. Section 2601 et seq.; the Occupational Safety and Health Act,
as amended, 29 U.S.C. Section 651, the Emergency Planning and Community
Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Mine Safety and
Health Act of 1977, as amended, 30 U.S.C. Section 801 et seq.; the Safe Drinking
Water Act, 42 U.S.C. Section 300f et seq.; and all comparable state and local
laws, laws of other jurisdictions or orders and regulations.

 

“Indebtedness” means: (i) all items arising from the borrowing of money that,
according to GAAP as in effect from time to time, would be included in
determining total liabilities as shown on the consolidated balance sheet of the
Company; and (ii) all obligations secured by any lien in property owned by the
Company or any Subsidiary whether or not such obligations shall have been
assumed; provided, however, Indebtedness shall not include deposits or other
indebtedness created, incurred or maintained in the ordinary course of the
Company’s or the Bank’s business (including, without limitation, federal funds
purchased, advances from any Federal Home Loan Bank, secured deposits of
municipalities, letters of credit issued by the Company or the Bank and
repurchase arrangements) and consistent with customary banking practices and
applicable laws and regulations.

 

“Indenture” means the indenture, dated as of the date hereof, by and between
Company and U.S. Bank National Association, as trustee, under which the
Subordinated Notes are to be issued, substantially in the form attached hereto
as Exhibit B, as the same may be amended or supplemented from time to time in
accordance with the terms thereof.

 

“Leases” means all leases, licenses or other documents providing for the use or
occupancy of any portion of any Property, including all amendments, extensions,
renewals, supplements, modifications, sublets and assignments thereof and all
separate letters or separate agreements relating thereto.

 

3

 

 

“Material Adverse Effect” means, with respect to any Person, any change or
effect that (i) is or would be reasonably likely to be material and adverse to
the financial condition, results of operations or business of such Person, or
(ii) would materially impair the ability of such Person to perform its
respective obligations under any of the Transaction Documents, or otherwise
materially impede the consummation of the transactions contemplated hereby;
provided, however, that “Material Adverse Effect” shall not be deemed to include
the impact of (1) changes in banking and similar laws, rules or regulations of
general applicability or interpretations thereof by Governmental Agencies, (2)
changes in GAAP or regulatory accounting requirements applicable to financial
institutions and their holding companies generally, (3) changes after the date
of this Agreement in general economic or capital market conditions affecting
financial institutions or their market prices generally and not specifically
related to the Company, the Bank or the Purchasers, (4) direct effects of
compliance with this Agreement on the operating performance of the Company, the
Bank or the Purchasers, including expenses incurred by the Company, the Bank or
the Purchasers in consummating the transactions contemplated by this Agreement,
and (5) the effects of any action or omission taken by the Company with the
prior written consent of the Purchasers, and vice versa, or as otherwise
contemplated by this Agreement, the Indenture and the Subordinated Notes.

 

“Maturity Date” means September 1, 2030.

 

“Person” means an individual, a corporation (whether or not for profit), a
partnership, a limited liability company, a joint venture, an association, a
trust, an unincorporated organization, a government or any department or agency
thereof (including a Governmental Agency) or any other entity or organization.

 

“Placement Agents” has the meaning set forth in the Recitals.

 

“Property” means any real property owned or leased by the Company or any
Affiliate or Subsidiary of the Company.

 

“Purchaser” or “Purchasers” has the meaning set forth in the preamble hereto.

 

“QIB” has the meaning set forth in Section 5.8.

 

“Registration Rights Agreement” has the meaning set forth in the Recitals.

 

“Regulation D” has the meaning set forth in the Recitals.

 

“Regulatory Agency” means any federal or state agency charged with the
supervision or regulation of depository institutions or holding companies of
depository institutions, or engaged in the insurance of depository institution
deposits, or any court, administrative agency or commission or other authority,
body or agency having supervisory or regulatory authority with respect to the
Company, the Bank or any of their Subsidiaries.

 

“SEC” means the Securities and Exchange Commission.

 

“Secondary Market Transaction” has the meaning set forth in Section 5.5.

 

“Securities Act” has the meaning set forth in the Recitals.

 

“Subordinated Note” means the Subordinated Note (or collectively, the
“Subordinated Notes”) in the form attached as an exhibit to the Indenture, as
amended, restated, supplemented or modified from time to time, and each
Subordinated Note delivered in substitution or exchange for such Subordinated
Note.

 

4

 

 

“Subordinated Note Amount” has the meaning set forth in the Recitals.

 

“Subsidiary” means, with respect to any Person, any corporation or entity (other
than a trust) in which a majority of the outstanding Equity Interest is directly
or indirectly owned by such Person.

 

“Tier 2 Capital” has the meaning given to the term “Tier 2 capital” in 12 C.F.R.
Part 217, as amended, modified and supplemented and in effect from time to time
or any replacement thereof.

 

“Transaction Documents” has the meaning set forth in Section 3.2.1.1.

 

“Trustee” means the trustee or successor in accordance with the applicable
provisions of the Indenture.

 

1.2         Interpretations. The foregoing definitions are equally applicable to
both the singular and plural forms of the terms defined. The words “hereof”,
“herein” and “hereunder” and words of like import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement. The word “including” when used in this Agreement without the
phrase “without limitation,” shall mean “including, without limitation.” All
references to time of day herein are references to Eastern Time unless otherwise
specifically provided. All references to this Agreement, the Subordinated Notes
and the Indenture shall be deemed to be to such documents as amended, modified
or restated from time to time. With respect to any reference in this Agreement
to any defined term, (i) if such defined term refers to a Person, then it shall
also mean all heirs, legal representatives and permitted successors and assigns
of such Person, and (ii) if such defined term refers to a document, instrument
or agreement, then it shall also include any amendment, replacement, extension
or other modification thereof.

 

1.3         Exhibits Incorporated. All Exhibits attached hereto are hereby
incorporated into this Agreement.

 

2.             SUBORDINATED DEBT.

 

2.1        Certain Terms. Subject to the terms and conditions herein contained,
the Company proposes to issue and sell to the Purchasers, severally and not
jointly, Subordinated Notes, which will be issued pursuant to the Indenture, in
an aggregate principal amount equal to the aggregate of the Subordinated Note
Amounts. Each Purchaser, severally and not jointly, agrees to purchase the
Subordinated Notes with an aggregate principal amount equal to the Subordinated
Note Amount set forth on its signature page hereto, which will be issued
pursuant to the Indenture, from the Company on the Closing Date in accordance
with the terms of, and subject to the conditions and provisions set forth in,
this Agreement, the Indenture and the Subordinated Notes. The Subordinated Note
Amounts shall be disbursed in accordance with Section 3.1.

 

2.2        Subordination. The Subordinated Notes shall be subordinated in
accordance with the subordination provisions set forth therein and in the
Indenture.

 

2.3         Maturity Date. On the Maturity Date, all sums due and owing under
the Subordinated Notes shall be repaid in full. The Company acknowledges and
agrees that the Purchasers have not made any commitments, either express or
implied, to extend the terms of the Subordinated Notes past their Maturity Date,
and shall not extend such terms beyond the Maturity Date unless the Company and
the Purchasers hereafter specifically otherwise agree in writing.

 

2.4         Unsecured Obligations. The obligations of the Company to the
Purchasers under the Subordinated Notes shall be unsecured.

 

5

 

 

2.5         The Closing. The closing of the sale and purchase of the
Subordinated Notes (the “Closing”) shall occur at the offices of the Company at
10:00 a.m. (Eastern Time) on the Closing Date, or at such other place or time or
on such other date as the parties hereto may agree.

 

2.6         Payments. The Company agrees that the matters concerning payments
and application of payments shall be as set forth in the Indenture.

 

2.7         No Right of Offset. Each Purchaser hereby expressly waives any right
of offset it may have against the Company or any of its Subsidiaries.

 

2.8         Use of Proceeds. The Company shall use the net proceeds from the
sale of Subordinated Notes for general corporate purposes, including support for
organic growth plans and support for Bank-level capital ratios, as well as
possible future redemption of callable subordinated notes.

 

3.             DISBURSEMENT.

 

3.1        Disbursement. On the Closing Date, assuming all of the terms and
conditions set forth in Section 3.2 have been satisfied by the Company, each
Purchaser shall disburse in immediately available funds the Subordinated Note
Amount set forth on each Purchaser’s respective signature page hereto to the
Company in exchange for an electronic securities entitlement through the
facilities of DTC in accordance with the Applicable Procedures with a principal
amount equal to such Subordinated Note Amount (the “Disbursement”). The Company
will deliver to the Trustee a global certificate representing the Subordinated
Notes (the “Global Note”) registered in the name of Cede & Co., as nominee for
DTC.

 

3.2         Conditions Precedent to Disbursement.

 

3.2.1           Conditions to the Purchasers’ Obligation. The obligation of each
Purchaser to consummate the purchase of the Subordinated Notes to be purchased
by it at Closing and to effect the Disbursement is subject to delivery by or at
the direction of the Company to such Purchaser (or, with respect to the
Indenture, the Trustee) each of the following (or written waiver by such
Purchaser prior to the Closing of such delivery):

 

3.2.1.1        Transaction Documents. This Agreement, the Indenture, the Global
Note and the Registration Rights Agreement (collectively, the “Transaction
Documents”), each duly authorized and executed by the Company.

 

3.2.1.2        Authority Documents.

 

(a)             A copy, certified by the Secretary or Assistant Secretary of the
Company, of the Articles of the Company;

 

(b)             A certificate of existence of the Company issued by the
Secretary of State of the State of Georgia;

 

(c)             A copy, certified by the Secretary or Assistant Secretary of the
Company, of the Bylaws of the Company;

 

(d)             A copy, certified by the Secretary or Assistant Secretary of the
Company, of the resolutions of the board of directors of the Company, and any
committee thereof, authorizing the issuance of the Subordinated Note and the
execution, delivery and performance of the Transaction Documents;

 

6

 

 

(e)             An incumbency certificate of the Secretary or Assistant
Secretary of the Company certifying the names of the officer or officers of the
Company authorized to sign the Transaction Documents and the other documents
provided for in this Agreement; and

 

(f)              The opinion of Troutman Pepper Hamilton Sanders LLP, counsel to
the Company, dated as of the Closing Date, substantially in the form attached
hereto as Exhibit C attached hereto addressed to the Purchasers and Placement
Agents.

 

3.2.1.3        Other Documents. Such other certificates, affidavits, schedules,
resolutions, notes and/or other documents that are provided for hereunder or
additional information regarding Company, the Bank and any other Subsidiary of
the Company that a Purchaser may reasonably request.

 

3.2.1.4        Aggregate Investments. Prior to, or contemporaneously with the
Closing, each Purchaser shall have actually delivered the Subordinated Note
Amount set forth on such Purchaser’s signature page.

 

3.2.2           Conditions to the Company’s Obligation.

 

3.2.2.1        The obligation of the Company to consummate the sale of the
Subordinated Notes and to effect the Closing is subject to: (i) with respect to
a given Purchaser, delivery by or at the direction of such Purchaser to the
Company of this Agreement and the Registration Rights Agreement, each duly
authorized and executed by such Purchaser; (ii) with respect to a given
Purchaser, the Company’s receipt of the Subordinated Note Amount set forth on
such Purchaser’s signature page; and (iii) the Company’s receipt of the
Indenture, duly authorized and executed by the Trustee.

 

4.             REPRESENTATIONS AND WARRANTIES OF COMPANY.

 

The Company hereby represents and warrants to each Purchaser that, except as
disclosed in the Company’s Reports:

 

4.1         Organization and Authority.

 

4.1.1           Organization Matters of the Company and Its Subsidiaries.

 

4.1.1.1        The Company is a duly organized corporation, is validly existing
and in good standing under the laws of the State of Georgia and has all
requisite corporate power and authority to conduct its business and activities
as presently conducted, to own its properties, and to perform its obligations
under the Transaction Documents. The Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a Material
Adverse Effect on the Company. The Company is duly registered as a bank holding
company under the Bank Holding Company Act of 1956, as amended.

 

4.1.1.2        Each Subsidiary of the Company other than the Bank either has
been duly organized and is validly existing as a corporation or limited
liability company, or, in the case of the Bank, has been duly chartered and is
validly existing as a national bank, in each case in good standing under the
laws of the jurisdiction of its incorporation, has corporate power and authority
to own, lease and operate its properties and to conduct its business and is duly
qualified as a foreign corporation to transact business and is in good standing
in each jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business, except where
the failure so to qualify or to be in good standing would not reasonably be
expected to result in a Material Adverse Effect on the Company. All of the
issued and outstanding shares of capital stock or other equity interests in each
Subsidiary of the Company have been duly authorized and validly issued, are
fully paid and non-assessable and are owned by the Company, directly or through
Subsidiaries of the Company, free and clear of any security interest, mortgage,
pledge, lien, encumbrance or claim.

 

7

 

 

4.1.1.3        The deposit accounts of the Bank are insured by the FDIC up to
applicable limits. The Bank has not received any notice or other information
indicating that the Bank is not an “insured depository institution” as defined
in 12 U.S.C. Section 1813, nor has any event occurred which could reasonably be
expected to adversely affect the status of the Bank as an FDIC-insured
institution.

 

4.1.2           Capital Stock and Related Matters. The Amended and Restated
Articles of the Company authorize the Company to issue 100,000,000 shares of
common stock and 10,000,000 shares of preferred stock. As of August 1, 2020,
there are 21,605,292 shares of the Company’s common stock issued and outstanding
and zero shares of the Company’s preferred stock issued and outstanding. All of
the outstanding capital stock of the Company has been duly authorized and
validly issued and is fully paid and non-assessable. There are, as of the date
hereof, no outstanding options, rights, warrants or other agreements or
instruments obligating the Company to issue, deliver or sell, or cause to be
issued, delivered or sold, additional shares of the capital stock of the Company
or obligating the Company to grant, extend or enter into any such agreement or
commitment to any Person other than the Company except pursuant to the Company’s
equity incentive plans duly adopted by the Company’s Board of Directors.

 

4.2         No Impediment to Transactions.

 

4.2.1           Transaction is Legal and Authorized. The issuance of the
Subordinated Notes pursuant to the Indenture, the borrowing of the aggregate of
the Subordinated Note Amounts, the execution of the Transaction Documents and
compliance by the Company with all of the provisions of the Transaction
Documents are within the corporate and other powers of the Company.

 

4.2.2           Agreement, Indenture and Registration Rights Agreement. This
Agreement, the Indenture and the Registration Rights Agreement have been duly
authorized, executed and delivered by the Company, and, assuming due
authorization, execution and delivery by the other parties thereto, including
the Trustee for purposes of the Indenture, constitute the legal, valid and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors’ rights generally or by general
equitable principles.

 

4.2.3           Subordinated Notes. The Subordinated Notes have been duly
authorized by the Company and when the Global Note representing such
Subordinated Notes is executed by the Company and completed and authenticated by
the Trustee in accordance with, and in the forms contemplated by the Indenture
and issued, delivered to and paid for by the Purchasers in accordance with the
terms of the Agreement, will have been duly executed, authenticated, issued and
delivered under the Indenture, and will constitute legal, valid and binding
obligations of the Company, entitled to the benefits of the Indenture, and
enforceable in accordance with their terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors’ rights generally or by general
equitable principles.

 

4.2.4           Exemption from Registration. Neither the Company, nor any of its
Subsidiaries or Affiliates, nor any Person acting on its or their behalf, has
engaged in any form of general solicitation or general advertising (within the
meaning of Regulation D) in connection with the offer or sale of the
Subordinated Notes. Assuming the accuracy of the representations and warranties
of each Purchaser set forth in this Agreement, the Subordinated Notes will be
issued in a transaction exempt from the registration requirements of the
Securities Act. No “bad actor” disqualifying event described in Rule
506(d)(1)(i)-(viii) of the Securities Act (a “Disqualification Event”) is
applicable to the Company or, to the Company’s knowledge, any Person described
in Rule 506(d)(1) (each, a “Company Covered Person”). The Company has exercised
reasonable care to determine whether any Company Covered Person is subject to a
Disqualification Event. The Company has complied, to the extent applicable, with
its disclosure obligations under Rule 506(e).

 

8

 

 

4.2.5           No Defaults or Restrictions. Neither the execution and delivery
of the Transaction Documents nor compliance with their respective terms and
conditions will (whether with or without the giving of notice or lapse of time
or both) (i) violate, conflict with or result in a breach of, or constitute a
default under: (1) the Articles or Bylaws of the Company; (2) any of the terms,
obligations, covenants, conditions or provisions of any corporate restriction or
of any contract, agreement, indenture, mortgage, deed of trust, pledge, bank
loan or credit agreement, or any other agreement or instrument to which the
Company or the Bank, as applicable, is now a party or by which it or any of its
properties may be bound or affected; (3) any judgment, order, writ, injunction,
decree or demand of any court, arbitrator, grand jury, or Governmental Agency
applicable to the Company or the Bank; or (4) any statute, rule or regulation
applicable to the Company, except (x) in the case of item (2) for such
violations and conflicts consented to or approved by the counterparty to the
Company or the Bank under any contract, agreement or instrument and (y) in the
case of items (2), (3) or (4), for such violations and conflicts that would not
reasonably be expected to have, singularly or in the aggregate, a Material
Adverse Effect on the Company and its Subsidiaries taken as a whole, or (ii)
result in the creation or imposition of any lien, charge or encumbrance of any
nature whatsoever upon any property or asset of the Company. Neither the Company
nor the Bank is in default in the performance, observance or fulfillment of any
of the terms, obligations, covenants, conditions or provisions contained in any
indenture or other agreement creating, evidencing or securing Indebtedness of
any kind or pursuant to which any such Indebtedness is issued, or any other
agreement or instrument to which the Company or the Bank, as applicable, is a
party or by which the Company or the Bank, as applicable, or any of its
properties may be bound or affected, except, in each case, only such defaults
that would not reasonably be expected to have, singularly or in the aggregate, a
Material Adverse Effect on the Company.

 

4.2.6           Governmental Consent. No governmental orders, permissions,
consents, approvals or authorizations are required to be obtained by the Company
that have not been obtained, and no registrations or declarations are required
to be filed by the Company that have not been filed in connection with, or, in
contemplation of, the execution and delivery of, and performance under, the
Transaction Documents, except for applicable requirements, if any, of the
Securities Act, the Exchange Act or state securities laws or “blue sky” laws of
the various states and any applicable federal or state banking laws and
regulations.

 

4.3         Possession of Licenses and Permits. The Company and its Subsidiaries
possess such permits, licenses, approvals, consents and other authorizations
(collectively, “Governmental Licenses”) issued by the appropriate Governmental
Agencies necessary to conduct the business now operated by them except where the
failure to possess such Governmental Licenses would not, singularly or in the
aggregate, have a Material Adverse Effect on the Company or such applicable
Subsidiary, taken as a whole; the Company and each Subsidiary of the Company is
in compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, individually or in the
aggregate, have a Material Adverse Effect on the Company or such applicable
Subsidiary, taken as a whole; all of the Governmental Licenses are valid and in
full force and effect, except where the invalidity of such Governmental Licenses
or the failure of such Governmental Licenses to be in full force and effect
would not have a Material Adverse Effect on the Company or such applicable
Subsidiary, taken as a whole; and neither the Company nor any Subsidiary of the
Company has received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses.

 

9

 

 

4.4         Financial Condition.

 

4.4.1          Company Financial Statements. The financial statements of the
Company included in the Company’s Reports (including the related notes, where
applicable), which have been made available to the Purchasers (i) have been
prepared from, and are in accordance with, the books and records of the Company;
(ii) fairly present in all material respects the results of operations, cash
flows, changes in shareholders’ equity and financial position of the Company and
its consolidated Subsidiaries, for the respective fiscal periods or as of the
respective dates therein set forth (subject in the case of unaudited statements
to recurring year-end audit adjustments normal in nature and amount), as
applicable; (iii) complied as to form, as of their respective dates of filing in
all material respects with applicable accounting and banking requirements as
applicable, with respect thereto; and (iv) have been prepared in accordance with
GAAP consistently applied during the periods involved, except, in each case, (x)
as indicated in such statements or in the notes thereto, (y) for any statement
therein or omission therefrom that was corrected, amended, or supplemented or
otherwise disclosed or updated in a subsequent Company’s Report, and (z) to the
extent that any unaudited interim financial statements do not contain the
footnotes required by GAAP, and were or are subject to normal and recurring
year-end adjustments, which were not or are not expected to be material in
amount, either individually or in the aggregate. The books and records of the
Company have been, and are being, maintained in all material respects in
accordance with GAAP and any other applicable legal and accounting requirements.
The Company does not have any material liability of any nature whatsoever
(whether absolute, accrued, contingent or otherwise and whether due or to become
due), except for those liabilities that are reflected or reserved against on the
consolidated balance sheet of the Company contained in the Company’s Reports for
the Company’s most recently completed quarterly or annual fiscal period, as
applicable, and for liabilities incurred in the ordinary course of business
consistent with past practice or in connection with this Agreement and the
transactions contemplated hereby.

 

4.4.2           Absence of Default. Since December 31, 2019, no event has
occurred which either by itself or with the lapse of time or the giving of
notice or both, would give any creditor of the Company the right to accelerate
the maturity of any material Indebtedness of the Company. The Company is not in
default under any other Lease, agreement or instrument, or any law, rule,
regulation, order, writ, injunction, decree, determination or award,
non-compliance with which could reasonably be expected to result in a Material
Adverse Effect on the Company.

 

4.4.3           Solvency. After giving effect to the consummation of the
transactions contemplated by this Agreement, the Company has capital sufficient
to carry on its business and transactions and is solvent and able to pay its
debts as they mature. No transfer of property is being made and no Indebtedness
is being incurred in connection with the transactions contemplated by this
Agreement with the intent to hinder, delay or defraud either present or future
creditors of the Company or any Subsidiary of the Company.

 

4.4.4          Ownership of Property. The Company and each of its Subsidiaries
has title as to all real property owned by it and title to all assets and
properties owned by the Company and such Subsidiary in the conduct of its
businesses, whether such assets and properties are real or personal, tangible or
intangible, including assets and property reflected in the most recent balance
sheet contained in the Company’s Reports or acquired subsequent thereto (except
to the extent that such assets and properties have been disposed of in the
ordinary course of business, since the date of such balance sheet), subject to
no encumbrances, liens, mortgages, security interests or pledges, except (i)
those items which secure liabilities for public or statutory obligations or any
discount with, borrowing from or other obligations to the Federal Home Loan
Bank, the Federal Reserve Bank, inter-bank credit facilities, reverse repurchase
agreements or any transaction by the Bank acting in a fiduciary capacity, (ii)
statutory liens for amounts not yet delinquent or which are being contested in
good faith and (iii) such as do not, individually or in the aggregate,
materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company or any
of its Subsidiaries. The Company and each of its Subsidiaries, as lessee, has
the right under valid and existing Leases of real and personal properties that
are material to the Company or such Subsidiary, as applicable, in the conduct of
its business to occupy or use all such properties as presently occupied and used
by it. Such existing Leases and commitments to Lease constitute or will
constitute operating Leases for both tax and financial accounting purposes
except as otherwise disclosed in the Company’s Reports and the Lease expense and
minimum rental commitments with respect to such Leases and Lease commitments are
as disclosed in all material respects in the Company’s Reports.

 

10

 

 

4.5         No Material Adverse Change. Since December 31, 2019, there has been
no development or event which has had or could reasonably be expected to have a
Material Adverse Effect on the Company or any of its Subsidiaries.

 

4.6         Legal Matters.

 

4.6.1           Compliance with Law. The Company and each of its Subsidiaries
(i) has complied with and (ii) to the Company’s knowledge, is not under
investigation with respect to and has not been threatened to be charged with or
given any notice of any material violation of any applicable statutes, rules,
regulations, orders and restrictions of any domestic or foreign government, or
any instrumentality or agency thereof, having jurisdiction over the conduct of
its business or the ownership of its properties, except where any such failure
to comply or violation would not reasonably be expected to have a Material
Adverse Effect on the Company and its Subsidiaries taken as a whole. The Company
and each of its Subsidiaries is in compliance with, and at all times prior to
the date hereof has been in compliance with, (x) all statutes, rules,
regulations, orders and restrictions of any domestic or foreign government, or
any Governmental Agency, applicable to it, and (y) its own privacy policies and
written commitments to customers, consumers and employees, concerning data
protection, the privacy and security of personal data, and the nonpublic
personal information of its customers, consumers and employees, in each case
except where any such failure to comply, would not result, individually or in
the aggregate, in a Material Adverse Effect on the Company or the applicable
Subsidiary. At no time during the two years prior to the date hereof has the
Company or any of its Subsidiaries received any written notice asserting any
violations of any of the foregoing.

 

4.6.2           Regulatory Enforcement Actions. The Company, the Bank and the
Company’s other Subsidiaries are in compliance in all material respects with all
laws administered by and regulations of any Governmental Agency applicable to it
or to them, the failure to comply with which would have a Material Adverse
Effect on the Company or the applicable Subsidiary. None of the Company, the
Bank, the Company’s or the Bank’s Subsidiaries nor any of their officers or
directors is now operating under any restrictions, agreements, memoranda,
commitment letter, supervisory letter or similar regulatory correspondence, or
other commitments (other than restrictions of general application) imposed by
any Governmental Agency, nor are, to the Company’s knowledge, (i) any such
restrictions threatened, (ii) any agreements, memoranda or commitments being
sought by any Governmental Agency , or (iii) any legal or regulatory violations
previously identified by, or penalties or other remedial action previously
imposed by, any Governmental Agency remains unresolved.

 

4.6.3           Pending Litigation. There are no actions, suits, proceedings or
written agreements pending, or, to the Company’s knowledge, threatened or
proposed, against the Company or any of its Subsidiaries at law or in equity or
before or by any federal, state, municipal, or other governmental department,
commission, board, or other administrative agency, domestic or foreign, that,
either separately or in the aggregate, would reasonably be expected to have a
Material Adverse Effect on the Company and any of its Subsidiaries, taken as a
whole, or affect issuance or payment of the Subordinated Notes; and neither the
Company nor any of its Subsidiaries is a party to or named as subject to the
provisions of any order, writ, injunction, or decree of, or any written
agreement with, any court, commission, board or agency, domestic or foreign,
that either separately or in the aggregate, will have a Material Adverse Effect
on the Company and any of its Subsidiaries, taken as a whole.

 

11

 

 

4.6.4           Environmental. No Property is or, to the Company’s knowledge,
has been a site for the use, generation, manufacture, storage, treatment,
release, threatened release, discharge, disposal, transportation or presence of
any Hazardous Materials, and neither the Company nor any of its Subsidiaries has
engaged in such activities. There are no claims or actions pending or, to the
Company’s knowledge, threatened against the Company or any of its Subsidiaries
by any Governmental Agency or by any other Person relating to any Hazardous
Materials or pursuant to any Hazardous Materials Law, except for such actions or
claims that would not reasonably be expected to have a Material Adverse Effect
on the Company and its Subsidiaries taken as a whole.

 

4.6.5           Brokerage Commissions. Except for commissions paid or payable to
the Placement Agents, neither the Company nor any Affiliate of the Company is
obligated to pay any brokerage commission or finder’s fee to any Person in
connection with the transactions contemplated by this Agreement.

 

4.6.6            Investment Company Act. Neither the Company nor any of its
Subsidiaries is an “investment company” or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act of 1940,
as amended.

 

4.7         No Misstatement. No exhibit, report, schedule or document, when
viewed together as a whole, furnished by the Company to the Purchasers in
connection with the negotiation, execution or performance of this Agreement
contains any untrue statement of a material fact, or omits to state a material
fact necessary to make the statements contained therein not misleading in light
of the circumstances when made or furnished to Purchasers and as of the date of
this Agreement, except for any statement therein or omission therefore which was
corrected, amended or supplemented or otherwise disclosed or updated in a
subsequent exhibit, report, schedule or document prior to the date of this
Agreement.

 

4.8         Internal Accounting Controls. The Company, the Bank and each other
Subsidiary of the Company has established and maintains a system of internal
control over financial reporting that pertains to the maintenance of records
that accurately and fairly reflect the transactions and dispositions of the
Company’s assets (on a consolidated basis), provides reasonable assurance that
transactions are recorded as necessary to permit preparation of financial
statements in accordance with GAAP, and that the Company’s and the Bank’s
receipts and expenditures and receipts and expenditures of each of the Company’s
other Subsidiaries are being made only in accordance with authorizations of the
Company management and Board of Directors, and provides reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use or
disposition of assets of the Company on a consolidated basis that could have a
Material Adverse Effect. Such internal control over financial reporting is
effective to provide reasonable assurance regarding the reliability of the
Company’s financial reporting and the preparation of the Company’s financial
statements for external purposes in accordance with GAAP. Since the conclusion
of the Company’s last completed fiscal year there has not been and there
currently is not (i) any significant deficiency or material weakness in the
design or operation of its internal control over financial reporting which is
reasonably likely to adversely affect its ability to record, process, summarize
and report financial information, or (ii) any fraud, whether or not material,
that involves management or other employees who have a role in the Company’s or
the Bank’s internal control over financial reporting. The Company (A) has
implemented and maintains disclosure controls and procedures reasonably designed
and maintained to ensure that material information relating to the Company is
made known to the Chief Executive Officer and the Chief Financial Officer of the
Company by others within the Company and (B) has disclosed, based on its most
recent evaluation prior to the date hereof, to the Company’s outside auditors
and the audit committee of the Company’s Board of Directors any significant
deficiencies and material weaknesses in the design or operation of internal
controls over financial reporting which are reasonably likely to adversely
affect the Company’s internal controls over financial reporting. Such disclosure
controls and procedures are effective for the purposes for which they were
established.

 

12

 

 

4.9         Tax Matters. The Company, the Bank and each Subsidiary of the
Company have (i) filed all material foreign, U.S. federal, state and local tax
returns, information returns and similar reports that are required to be filed,
and all such tax returns are true, correct and complete in all material
respects, and (ii) paid all material taxes required to be paid by it and any
other material assessment, fine or penalty levied against it, other than taxes
(x) currently payable without penalty or interest, or (y) being contested in
good faith by appropriate proceedings.

 

4.10       Exempt Offering. Assuming the accuracy of the Purchasers’
representations and warranties set forth in this Agreement, no registration
under the Securities Act is required for the offer and sale of the Subordinated
Notes by the Company to the Purchasers.

 

Representations and Warranties Generally. The representations and warranties of
the Company set forth in this Agreement, or in any other agreement entered into
by the Company pursuant to the requirements of this Agreement, are true and
correct as of the date hereof and as otherwise specifically provided herein or
therein. Any certificate signed by a duly authorized representative of the
Company and delivered to a Purchaser or to counsel for a Purchaser shall be
deemed to be a representation and warranty by the Company to such Purchaser as
to the matters set forth therein.

 

5.             GENERAL COVENANTS, CONDITIONS AND AGREEMENTS.

 

The Company hereby further covenants and agrees with each Purchaser as follows:

 

5.1         Compliance with Transaction Documents. The Company shall comply
with, observe and timely perform each and every one of its covenants, agreements
and obligations under the Transaction Documents.

 

5.2         Affiliate Transactions. The Company shall not itself, nor shall it
cause, permit or allow any of its Subsidiaries to enter into any material
transaction, including, the purchase, sale or exchange of property or the
rendering of any service, with any Affiliate of the Company except in the
ordinary course of business and pursuant to the reasonable requirements of the
Company’s or such Affiliate’s business and upon terms consistent with applicable
laws and regulations and reasonably found by the appropriate board(s) of
directors to be fair and reasonable and no less favorable to the Company or such
Affiliate than would be obtained in a comparable arm’s length transaction with a
Person not an Affiliate.

 

5.3         Compliance with Laws; Additional Agreements.

 

5.3.1           Generally. The Company shall comply and cause the Bank and each
of its other Subsidiaries to comply in all material respects with all applicable
statutes, rules, regulations, orders and restrictions in respect of the conduct
of its business and the ownership of its properties, except, in each case, where
such noncompliance would not reasonably be expected to have a Material Adverse
Effect on the Company.

 

13

 

 

 

5.3.2            Regulated Activities. The Company shall not itself, nor shall
it cause, permit or allow the Bank or any other of its Subsidiaries to (i)
engage in any business or activity not permitted by all applicable laws and
regulations, except where such business or activity would not reasonably be
expected to have a Material Adverse Effect on the Company, the Bank and/or such
of its Subsidiaries or (ii) make any loan or advance secured by the capital
stock of another bank or depository institution, or acquire the capital stock,
assets or obligations of or any interest in another bank or depository
institution, in each case other than in accordance with applicable laws and
regulations and safe and sound banking practices.

 

5.3.3            Taxes. The Company shall and shall cause the Bank and any other
of its Subsidiaries to promptly pay and discharge all taxes, assessments and
other governmental charges imposed upon the Company, the Bank or any other of
the Company’s Subsidiaries or upon the income, profits, or property of the
Company or any of its Subsidiaries and all claims for labor, material or
supplies which, if unpaid, might by law become a lien or charge upon the
property of the Company, the Bank or any other of the Company’s Subsidiaries if
such nonpayment could reasonably be expected to have a Material Adverse Effect
on the Company. Notwithstanding the foregoing, none of the Company, the Bank or
any other of the Company’s Subsidiaries shall be required to pay any such tax,
assessment, charge or claim, so long as the validity thereof is being contested
in good faith by appropriate proceedings, and appropriate reserves therefor are
being maintained on the books of the Company, the Bank and such other Subsidiary
of the Company.

 

5.3.4            Corporate Existence. The Company shall do or cause to be done
all things reasonably necessary to maintain, preserve and renew its corporate
existence and that of the Bank and its and their rights and franchises, and
comply in all material respects with all related laws applicable to the Company,
the Bank or the other Subsidiaries.

 

5.3.5            Tier 2 Capital. If all or any portion of the Subordinated Notes
ceases to be Tier 2 Capital, other than due to the limitation imposed on the
capital treatment of subordinated debt during the five (5) years immediately
preceding the Maturity Date of the Subordinated Notes, the Company will
immediately notify the Holder (as defined in the Indenture), and thereafter the
Company and the Holder will work together in good faith to execute and deliver
all agreements as reasonably necessary in order to restructure the applicable
portions of the obligations evidenced by the Subordinated Notes to qualify as
Tier 2 Capital; provided, however, that nothing contained in this Agreement
shall limit the Company’s right to redeem the Subordinated Notes upon the
occurrence of a Tier 2 Capital Event as described in the Subordinated Notes.

 

5.4          Absence of Control. It is the intent of the parties to this
Agreement that in no event shall the Purchasers, by reason of any of the
Transaction Documents, be deemed to control, directly or indirectly, the
Company, and the Purchasers shall not exercise, or be deemed to exercise,
directly or indirectly, a controlling influence over the management or policies
of the Company.

 

5.5           Secondary Market Transactions. Each Purchaser shall have the right
at any time and from time to time to securitize its Subordinated Notes or any
portion thereof in a single asset securitization or a pooled loan securitization
of rated single or multi-class securities secured by or evidencing ownership
interests in the Subordinated Notes (each such securitization is referred to
herein as a “Secondary Market Transaction”). In connection with any such
Secondary Market Transaction, the Company shall, at the Company’s expense,
cooperate with any such Purchaser and otherwise reasonably assist any such
Purchaser in satisfying the market standards to which any such Purchaser
customarily adheres or which may be reasonably required in the marketplace or by
applicable rating agencies in connection with any such Secondary Market
Transaction, but in no event shall the Company be required to incur any costs or
expenses in excess of $10,000 in connection therewith. Subject to any written
confidentiality obligation, all information regarding the Company may be
furnished, without liability except in the case of gross negligence or willful
misconduct, to any such Purchaser and to any Person reasonably deemed necessary
by such Purchaser in connection with participation in such Secondary Market
Transaction. All documents, financial statements, appraisals and other data
relevant to the Company or the Subordinated Notes may be retained by any such
Person, subject to the terms of any applicable confidentiality agreements.

 

14

 

 

5.6           Bloomberg. The Company shall use commercially reasonable efforts
to cause the Subordinated Notes to be quoted on Bloomberg.

 

5.7           Rule 144A Information. While any Subordinated Notes remain
“restricted securities” within the meaning of the Securities Act, the Company
will make available, upon request, to any seller of such Subordinated Notes the
information specified in Rule 144A(d)(4) under the Securities Act, unless the
Company is then subject to Section 13 or 15(d) of the Exchange Act.

 

5.8           DTC Registration. The Company shall use commercially reasonable
efforts to cause the Subordinated Notes held by “qualified institutional
buyers,” as defined in Rule 144A under the Securities Act (a “QIB”), to be
registered in the name of Cede & Co. as nominee of DTC or a nominee of DTC.

 

5.9           NRSRO Rating. The Company will use commercially reasonable efforts
to maintain a rating by a nationally recognized statistical rating organization
while any Subordinated Notes remain outstanding.

 

5.10        Resale Registration Statement. Subject to the terms and conditions
of this Agreement, the Company will provide to the Purchasers the resale
registration rights described in the Registration Rights Agreement.

 

6.             REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.

 

Each Purchaser hereby represents and warrants to the Company, and covenants with
the Company, severally and not jointly, as follows:

 

6.1           Legal Power and Authority. It has all necessary power and
authority to execute, deliver and perform its obligations under this Agreement
and to consummate the transactions contemplated hereby. It is an entity duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization.

 

6.2           Authorization and Execution. The execution, delivery and
performance of this Agreement and the Registration Rights Agreement have been
duly authorized by all necessary action on the part of such Purchaser, and,
assuming due authorization, execution and delivery by the Company, this
Agreement and the Registration Rights Agreement are each a legal, valid and
binding obligation of such Purchaser, enforceable against such Purchaser in
accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting creditors’ rights generally or by general equitable
principles.

 

6.3          No Conflicts. Neither the execution, delivery or performance of
this Agreement and the Registration Rights Agreement nor the consummation of any
of the transactions contemplated by the Transaction Documents will conflict
with, violate, constitute a breach of or a default (whether with or without the
giving of notice or lapse of time or both) under (i) its organizational
documents, (ii) any agreement to which it is party, (iii) any law applicable to
it or (iv) any order, writ, judgment, injunction, decree, determination or award
binding upon or affecting it.

 

15

 

 

6.4          Purchase for Investment. It is purchasing the Subordinated Note for
its own account and not with a view to distribution and with no present
intention of reselling, distributing or otherwise disposing of the same. It has
no present or contemplated agreement, undertaking, arrangement, obligation,
indebtedness or commitment providing for, or which is likely to compel, a
disposition of the Subordinated Notes in any manner.

 

6.5           Institutional Accredited Investor. It is and will be on the
Closing Date (i) an institutional “accredited investor” as such term is defined
in Rule 501(a) of Regulation D and as contemplated by subsections (1), (2), (3)
and (7) of Rule 501(a) of Regulation D, and has no less than $5,000,000 in total
assets, or (ii) a QIB.

 

6.6           Financial and Business Sophistication. It has such knowledge and
experience in financial and business matters that it is capable of evaluating
the merits and risks of the prospective investment in the Subordinated Notes. It
has relied solely upon its own knowledge of, and the advice of its own legal,
financial or other advisors with regard to, the legal, financial, tax and other
considerations involved in deciding to invest in the Subordinated Notes.

 

6.7           Ability to Bear Economic Risk of Investment. It recognizes that an
investment in the Subordinated Notes involves substantial risk. It has the
ability to bear the economic risk of the prospective investment in the
Subordinated Notes, including the ability to hold the Subordinated Notes
indefinitely, and further including the ability to bear a complete loss of all
of its investment in the Company.

 

6.8           Information. It acknowledges that (i) it is not being provided
with the disclosures that would be required if the offer and sale of the
Subordinated Notes were registered under the Securities Act, nor is it being
provided with any offering circular or prospectus prepared in connection with
the offer and sale of the Subordinated Notes; (ii) it has conducted its own
examination of the Company and the terms of the Subordinated Notes to the extent
it deems necessary to make its decision to invest in the Subordinated Notes; and
(iii) it has availed itself of publicly available financial and other
information concerning the Company to the extent it deems necessary to make its
decision to purchase the Subordinated Notes. It has reviewed the information set
forth in the Company’s Reports, the exhibits and schedules hereto and the
information contained in the data room established by the Company in connection
with the transactions contemplated by this Agreement.

 

6.9           Access to Information. It acknowledges that it and its advisors
have been furnished with all materials relating to the business, finances and
operations of the Company that have been requested by it or its advisors and
have been given the opportunity to ask questions of, and to receive answers
from, persons acting on behalf of the Company concerning terms and conditions of
the transactions contemplated by this Agreement in order to make an informed and
voluntary decision to enter into this Agreement.

 

6.10        Investment Decision. It has made its own investment decision based
upon its own judgment, due diligence and advice from such advisors as it has
deemed necessary and not upon any view expressed by any other Person or entity,
including the Placement Agents (or, with respect to the Indenture, the Trustee).
Neither such inquiries nor any other due diligence investigations conducted by
it or its advisors or representatives, if any, shall modify, amend or affect its
right to rely on the Company’s representations and warranties contained herein.
It is not relying upon, and has not relied upon, any advice, statement,
representation or warranty made by any Person by or on behalf of the Company,
including, without limitation, the Placement Agents (or, with respect to the
Indenture, the Trustee), except for the express statements, representations and
warranties of the Company made or contained in this Agreement. Furthermore, it
acknowledges that (i) the Placement Agents have not performed any due diligence
review on behalf of it and (ii) nothing in this Agreement or any other materials
presented by or on behalf of the Company to it in connection with the purchase
of the Subordinated Notes constitutes legal, tax or investment advice.

 

16

 

 

6.11         Private Placement; No Registration; Restricted Legends. It
understands and acknowledges that the Subordinated Notes are being sold by the
Company without registration under the Securities Act in reliance on the
exemption from federal and state registration set forth in, respectively, Rule
506(b) of Regulation D and Sections 4(a)(2) and 18 of the Securities Act, or any
state securities laws, and accordingly, may be resold, pledged or otherwise
transferred only if exemptions from the Securities Act and applicable state
securities laws are available to it. It is not subscribing for the Subordinated
Notes as a result of or subsequent to any general solicitation or general
advertising, in each case within the meaning of Rule 502(c) of Regulation D,
including any advertisement, article, notice or other communication published in
any newspaper, magazine or similar media or broadcast over television or radio,
or presented at any seminar or meeting. It further acknowledges and agrees that
the Global Note will bear the restrictive legend set forth in the form of
Subordinated Note, which is attached as an exhibit to the Indenture. It further
acknowledges its primary responsibilities under the Securities Act and,
accordingly, will not sell or otherwise transfer the Subordinated Notes or any
interest therein without complying with the requirements of the Securities Act
and the rules and regulations promulgated thereunder and the requirements set
forth in this Agreement.

 

6.12        Placement Agents. It will purchase the Subordinated Note(s) directly
from the Company and not from the Placement Agents and understands that none of
the Placement Agents nor any other broker or dealer has any obligation to make a
market in the Subordinated Notes.

 

6.13         Tier 2 Capital. If the Company provides notice as contemplated in
Section 5.3.5 of the occurrence of the event contemplated in such section,
thereafter the Company and the Purchasers will work together in good faith to
execute and deliver all agreements as reasonably necessary in order to
restructure the applicable portions of the obligations evidenced by the
Subordinated Notes to qualify as Tier 2 Capital; provided, however, that nothing
contained in this Agreement shall limit the Company’s right to redeem the
Subordinated Notes upon the occurrence of a Tier 2 Capital Event as described in
the Subordinated Notes.

 

6.14        Accuracy of Representations. It understands that each of the
Placement Agents and the Company are relying upon the truth and accuracy of the
foregoing representations, acknowledgements and agreements in connection with
the transactions contemplated by this Agreement.

 

6.15         Representations and Warranties Generally. The representations and
warranties of the Purchaser set forth in this Agreement are true and correct as
of the date hereof and as otherwise specifically provided herein. Any
certificate signed by a duly authorized representative of the Purchaser and
delivered to the Company or to counsel for the Company shall be deemed to be a
representation and warranty by the Purchaser to the Company as to the matters
set forth therein.

 

7.             MISCELLANEOUS.

 

7.1          Prohibition on Assignment by the Company. Except as described in
the Indenture, the Company may not assign, transfer or delegate any of its
rights or obligations under this Agreement or the Subordinated Notes without the
prior written consent of the Holders (as defined in the Indenture). In addition,
in accordance with the terms of the Subordinated Notes, any transfer of such
Subordinated Notes by the Holders must be made in accordance with the Assignment
Form attached thereto and the requirements and restrictions thereof.

 

17

 

 

7.2           Time of the Essence. Time is of the essence for this Agreement.

 

7.3           Waiver or Amendment. No waiver or amendment of any term,
provision, condition, covenant or agreement herein shall be effective unless in
writing and signed by all of the parties hereto. Waiver or amendment of any term
of the Indenture and/or the Subordinated Note shall be governed by the terms of
the Indenture. No failure to exercise or delay in exercising, by a Purchaser or
any holder of the Subordinated Notes, of any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power or privilege preclude any other or further exercise thereof, or
the exercise of any other right or remedy provided by law. The rights and
remedies provided in this Agreement are cumulative and not exclusive of any
right or remedy provided by law or equity. No notice or demand on the Company in
any case shall, in itself, entitle the Company to any other or further notice or
demand in similar or other circumstances or constitute a waiver of the rights of
the Purchasers to any other or further action in any circumstances without
notice or demand. No consent or waiver, expressed or implied, by the Purchasers
to or of any breach or default by the Company in the performance of its
obligations hereunder shall be deemed or construed to be a consent or waiver to
or of any other breach or default in the performance of the same or any other
obligations of the Company hereunder.

 

7.4           Severability. Any provision of this Agreement which is
unenforceable or invalid or contrary to law, or the inclusion of which would
adversely affect the validity, legality or enforcement of this Agreement, shall
be of no effect and, in such case, all the remaining terms and provisions of
this Agreement shall subsist and be fully effective according to the tenor of
this Agreement the same as though any such invalid portion had never been
included herein. Notwithstanding any of the foregoing to the contrary, if any
provisions of this Agreement or the application thereof are held invalid or
unenforceable only as to particular persons or situations, the remainder of this
Agreement, and the application of such provision to persons or situations other
than those to which it shall have been held invalid or unenforceable, shall not
be affected thereby, but shall continue valid and enforceable to the fullest
extent permitted by law.

 

7.5           Notices. Any notice which any party hereto may be required or may
desire to give hereunder shall be deemed to have been given if in writing and if
delivered personally, or if mailed, postage prepaid, by United States registered
or certified mail, return receipt requested, or if delivered by a responsible
overnight commercial courier promising next business day delivery, addressed:

 

if to the Company:

Atlantic Capital Bancshares, Inc.

945 East Paces Ferry Road NE

Suite 1600

Atlanta, Georgia 30326

Attention: Chief Financial Officer

    with a copy to:

Troutman Pepper Hamilton Sanders LLP

600 Peachtree Street, Suite 3000

Atlanta, Georgia 30308

Attention: James W. Stevens

E-mail: james.stevens@troutman.com

    if to the Purchasers: To the address indicated on such Purchaser’s signature
page.

 

18

 

 

or to such other address or addresses as the party to be given notice may have
furnished in writing to the party seeking or desiring to give notice, as a place
for the giving of notice; provided that no change in address shall be effective
until five (5) Business Days after being given to the other party in the manner
provided for above. Any notice given in accordance with the foregoing shall be
deemed given when delivered personally or, if mailed, three (3) Business Days
after it shall have been deposited in the United States mails as aforesaid or,
if sent by overnight courier, the Business Day following the date of delivery to
such courier (provided next business day delivery was requested).

 

7.6           Successors and Assigns. This Agreement shall inure to the benefit
of the parties and their respective heirs, legal representatives, successors and
assigns; except that, unless a Purchaser consents in writing, no assignment made
by the Company in violation of this Agreement shall be effective or confer any
rights on any purported assignee of the Company. The term “successors and
assigns” will not include a purchaser of any of the Subordinated Notes from any
Purchaser merely because of such purchase.

 

7.7          No Joint Venture. Nothing contained herein or in any document
executed pursuant hereto and no action or inaction whatsoever on the part of a
Purchaser, shall be deemed to make a Purchaser a partner or joint venturer with
the Company.

 

7.8           Documentation. All documents and other matters required by any of
the provisions of this Agreement to be submitted or furnished to a Purchaser
shall be in form and substance satisfactory to such Purchaser.

 

7.9           Entire Agreement. This Agreement, the Indenture, the Registration
Rights Agreement and the Subordinated Notes, along with any exhibits thereto,
constitute the entire agreement between the parties hereto with respect to the
subject matter hereof and may not be modified or amended in any manner other
than by supplemental written agreement executed by the parties hereto. No party,
in entering into this Agreement, has relied upon any representation, warranty,
covenant, condition or other term that is not set forth in this Agreement, the
Indenture, the Registration Rights Agreement or the Subordinated Notes.

 

7.10        Choice of Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without giving effect to its
laws or principles of conflict of laws. Nothing herein shall be deemed to limit
any rights, powers or privileges which a Purchaser may have pursuant to any law
of the United States of America or any rule, regulation or order of any
department or agency thereof and nothing herein shall be deemed to make unlawful
any transaction or conduct by a Purchaser which is lawful pursuant to, or which
is permitted by, any of the foregoing.

 

7.11         No Third-Party Beneficiary. This Agreement is made for the sole
benefit of the Company and the Purchasers, and no other Person shall be deemed
to have any privity of contract hereunder nor any right to rely hereon to any
extent or for any purpose whatsoever, nor shall any other Person have any right
of action of any kind hereon or be deemed to be a third party beneficiary
hereunder; provided, that the Placement Agents may rely on the representations
and warranties contained herein to the same extent as if they were a party to
this Agreement.

 

7.12         Legal Tender of United States. All payments hereunder shall be made
in coin or currency which at the time of payment is legal tender in the United
States of America for public and private debts.

 

7.13         Captions; Counterparts. Captions contained in this Agreement in no
way define, limit or extend the scope or intent of their respective provisions.
This Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed and
delivered shall be deemed to be an original and all of which taken together
shall constitute but one and the same instrument. In the event that any
signature is delivered by facsimile transmission, or by e-mail delivery of a
“.pdf” format data file, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile signature page
were an original thereof.

 

19

 

 

7.14         Knowledge; Discretion. All references herein to a Purchaser’s or
the Company’s knowledge shall be deemed to mean the knowledge of such party
based on the actual knowledge of such party’s Chief Executive Officer and Chief
Financial Officer or such other persons holding equivalent offices. Unless
specified to the contrary herein, all references herein to an exercise of
discretion or judgment by a Purchaser, to the making of a determination or
designation by a Purchaser, to the application of a Purchaser’s discretion or
opinion, to the granting or withholding of a Purchaser’s consent or approval, to
the consideration of whether a matter or thing is satisfactory or acceptable to
a Purchaser, or otherwise involving the decision making of a Purchaser, shall be
deemed to mean that such Purchaser shall decide using the reasonable discretion
or judgment of a prudent lender.

 

7.15         Waiver of Right to Jury Trial. TO THE EXTENT PERMITTED UNDER
APPLICABLE LAW, THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHT THAT THEY MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING
IN ANY WAY IN CONNECTION WITH ANY OF THE TRANSACTION DOCUMENTS, OR ANY OTHER
STATEMENTS OR ACTIONS OF THE COMPANY OR THE PURCHASERS. THE PARTIES ACKNOWLEDGE
THAT THEY HAVE BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE
MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL SELECTED OF THEIR OWN FREE
WILL. THE PARTIES FURTHER ACKNOWLEDGE THAT (I) THEY HAVE READ AND UNDERSTAND THE
MEANING AND RAMIFICATIONS OF THIS WAIVER, (II) THIS WAIVER HAS BEEN REVIEWED BY
THE PARTIES AND THEIR COUNSEL AND IS A MATERIAL INDUCEMENT FOR ENTRY INTO THIS
AGREEMENT AND THE REGISTRATION RIGHTS AGREEMENT, AND (III) THIS WAIVER SHALL BE
EFFECTIVE AS TO EACH OF SUCH TRANSACTION DOCUMENTS AS IF FULLY INCORPORATED
THEREIN.

 

7.16         Expenses. Except as otherwise provided in this Agreement, each of
the parties will bear and pay all other costs and expenses incurred by it or on
its behalf in connection with the transactions contemplated pursuant to this
Agreement.

 

7.17         Survival. Each of the representations and warranties set forth in
this Agreement shall survive the consummation of the transactions contemplated
hereby for a period of one year after the date hereof. Except as otherwise
provided herein, all covenants and agreements contained herein shall survive
until, by their respective terms, they are no longer operative.

 

[Signature Pages Follow]

 

20

 

 

IN WITNESS WHEREOF, the Company has caused this Subordinated Note Purchase
Agreement to be executed by its duly authorized representative as of the date
first above written.

 

  COMPANY:       ATLANTIC CAPITAL BANCSHARES, INC.       By:       Name: Douglas
L. Williams     Title:   President and Chief Executive Officer

 

[Company Signature Page to Subordinated Note Purchase Agreement]

 

 

 

 

IN WITNESS WHEREOF, the undersigned Purchaser has caused this Subordinated Note
Purchase Agreement to be executed by its duly authorized representative as of
the date first above written.

 

  PURCHASER:        [INSERT PURCHASER’S NAME]       By:       Name:  [●]    
Title:   [●]       Address of Purchaser:       [●]       Principal Amount of
Purchased Subordinated Note:       $[●]

 

[Purchaser Signature Page to Subordinated Note Purchase Agreement]

 

 

 

 

EXHIBIT A

 

REGISTRATION RIGHTS AGREEMENT

 

 

 

 

EXHIBIT B

 

FORM OF INDENTURE

 

 

 

 

EXHIBIT C

 

OPINION OF COUNSEL

 

25