Exhibit 10.1

EXECUTION VERSION

SUBORDINATED NOTE PURCHASE AGREEMENT
This SUBORDINATED NOTE PURCHASE AGREEMENT (this “Agreement”), dated as of
November 12, 2019, is made by and among Investar Holding Corporation, a
Louisiana corporation (the “Company”), and the several purchasers identified on
the signature pages hereto (each a “Purchaser” and collectively, the
“Purchasers”).
RECITALS
WHEREAS, the Company is offering for sale to the Purchasers up to $25,000,000 in
aggregate principal amount of Subordinated Notes (as defined herein), which
aggregate amount is intended to qualify as Tier 2 Capital (as defined herein).
WHEREAS, the Company has engaged Performance Trust Capital Partners as its
exclusive placement agent (“Placement Agent”) for the offering of the
Subordinated Notes;
WHEREAS, each of the Purchasers is an institutional accredited investor as that
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 qualified
institutional buyer as that term is defined in Rule 144A promulgated under the
Securities Act (“QIB”);
WHEREAS, the offer and sale of the Subordinated Notes by the Company is being
made in reliance upon the exemption from registration under Section 4(a)(2) of
the Securities Act and Rule 506(b) of Regulation D promulgated under the
Securities Act; and
WHEREAS, each Purchaser has agreed to purchase from the Company a Subordinated
Note in the principal amount set forth on such Purchaser’s signature page hereto
(the “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.
NOW, THEREFORE, in consideration of the mutual covenants, conditions and
agreements herein contained and other good and valuable consideration, the
receipt of which is acknowledged, the undersigned parties agree as follows:
AGREEMENT
1.    DEFINITIONS; INTERPRETATION.

1.1Defined Terms. In this Agreement, unless the context otherwise requires or
unless otherwise specifically provided in this Agreement:

“Affiliate(s)” means, with respect to any Person, such Person’s immediate family
members, partners, members or parent and subsidiary corporations, and any other
Person directly or indirectly controlling, controlled by, or under common
control with said Person and their respective Affiliates.
“Agreement” has the meaning set forth in the preamble.

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“Bank” means Investar Bank, National Association, a national banking association
and wholly owned subsidiary of the Company.
“Board of Directors” means the Board of Directors 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 Louisiana are permitted or required
by any applicable Law or executive order to close.
“Closing” has the meaning set forth in Section 2.2.1.
“Closing Date” has the meaning set forth in Section 2.2.1.
“Commission” means the Securities and Exchange Commission.
“Company” has the meaning set forth in the preamble and will include any
successors to the Company.
“Company Financial Statements” mean (i) the audited financial statements of the
Company for the year ended December 31, 2018; and (ii) the unaudited financial
statements of the Company for the quarters ended March 31, 2019 and June 30,
2019.
“Company Reports” has the meaning set forth in Section 3.7.
“Disclosure Letter” has the meaning set forth in Section 1.3.
“DTC” has the meaning set forth in Section 5.1.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“FDIC” means the Federal Deposit Insurance Corporation.
“Federal Reserve” 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.
“Governmental Entity” means, individually or collectively, any arbitrator,
court, governmental body, commission, board, regulatory body, administrative
agency or authority or agency with jurisdiction over the Company or any
Subsidiary of the Company or any of their respective properties, assets or
operations.
“Holder” has the meaning set forth in Section 5.4.2.
“Indebtedness” has the meaning set forth in Section 3.3.3.
“Law” has the meaning set forth in Section 3.13.
“Lien” has the meaning set forth in Section 3.3.2.

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“Material Adverse Effect” means 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 the Company and its Subsidiaries taken as a whole,
or (ii) would materially impair the ability of the Company to perform its
obligations under any of the Transaction Documents or otherwise materially
impede the consummation of the transactions contemplated hereby; provided,
however, that “Material Adverse Effect” will 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 Entities, (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 or its Subsidiaries, including changes in prevailing
interest rates, credit availability and liquidity, currency exchange rates, and
price levels or trading volumes in the United States or foreign securities
markets, (4) direct effects of compliance with this Agreement on the operating
performance of the Company or its Subsidiaries, including expenses incurred by
the Company or its Subsidiaries in consummating the transactions contemplated by
this Agreement, (5) the effects of any action or omission taken by the Company
with the prior written consent of each of the Purchasers, or as otherwise
contemplated by this Agreement and the Subordinated Notes and (6) changes in
global or national political conditions, including the outbreak, continuation or
escalation of war, hostilities or acts of terrorism (whether declared or
undeclared), any national or international calamity, or any natural disasters.
“Note Amount” has the meaning set forth in the Recitals.
“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 Entity) or any other entity or organization.
“Placement Agent” has the meaning set forth in the recitals.
“Previously Disclosed” with regard to a party means information set forth in its
Disclosure Letter, and in the case of the Company, also includes any information
set forth in any filing made by the Company under the Exchange Act with the
Commission.
“Purchaser” or “Purchasers” has the meaning set forth in the preamble.
“QIB” has the meaning set forth in the recitals.
“Regulation D” has the meaning set forth in the recitals.
“Regulatory Agreement” has the meaning set forth in Section 3.14.
“Rule 144” means Rule 144 promulgated under the Securities Act.
“Secondary Market Transaction” has the meaning set forth in Section 5.6.
“Securities Act” has the meaning set forth in the recitals.
“Subordinated Note(s)” means any one of an issue of Company notes designated as
the “5.125% Fixed to Floating Rate Subordinated Notes due 2029,” in
substantially the form attached as Exhibit A, as amended, restated, supplemented
or modified from time to time, and each Subordinated Note delivered in
substitution or exchange for such Subordinated Note.

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“Subsidiary” means with respect to any Person, any corporation or entity in
which a majority of the outstanding equity interests 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 and 12 C.F.R. Part 250, as amended, modified and supplemented and in
effect from time to time or any replacement thereof.

“Transaction Documents” means this Agreement and the Subordinated Notes,
collectively.
1.2    Interpretation. 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 will 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,” will 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 will 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 will 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 will also include any
amendment, replacement, extension or other modification thereof.

1.3    Disclosure Letter. On or prior to the date hereof, the Company has
delivered to each Purchaser, and each Purchaser has delivered to the Company, to
the extent applicable, a letter (a “Disclosure Letter”) setting forth, among
other things, items the disclosure of which is (i) required by an express
disclosure requirement contained in a provision hereof or (ii) necessary or
appropriate to take exception to one or more representations or warranties
contained in Article 3 with respect to the Company, or in Article 4 with respect
to such Purchaser, or to one or more covenants contained in this Agreement;
provided, that if such information is disclosed in such a way as to make its
relevance or applicability to another provision of this Agreement reasonably
apparent on its face, such information shall be deemed to be responsive to such
other provision of this Agreement. Notwithstanding anything in this Agreement to
the contrary, the mere inclusion of an item in a Disclosure Letter shall not be
deemed an admission that such item represents a material exception or material
fact, event or circumstance or that such item has had or would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

2.    PURCHASE; CLOSING.

2.1    Purchase. On the basis of the representations, warranties, agreements and
covenants herein contained and subject to the terms and conditions herein set
forth, the Company agrees to issue and sell to each Purchaser, severally and not
jointly, and each Purchaser, severally and not jointly, agrees to purchase from
the Company, at a purchase price of 100% of the Note Amount thereof, the
aggregate principal amount of the Subordinated Notes set forth on the signature
page for such Purchaser.

2.2Closing.

2.2.1The closing of the purchase of the Subordinated Notes by the Purchasers
(the “Closing”) will occur at 10:00 a.m., Central time, on the date hereof at
the offices of the Company, or remotely via the electronic or other exchange of
documents and signature pages, or such other date or location as agreed by the
parties. The date of the Closing is referred to as the “Closing Date.”

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2.2.2At the Closing, each Purchaser will deliver the Note Amount set forth on
each Purchaser’s respective signature page hereto to the Company in exchange for
a Subordinated Note with a principal amount equal to such Note Amount. The
Company will deliver to the respective Purchaser one or more certificates
representing the Subordinated Notes in definitive form (or provide evidence of
the same with the original to be delivered by the Company by overnight delivery
on the next calendar day in accordance with the delivery instructions of the
Purchaser), registered in such names and denominations as such Purchasers may
request.

2.3Closing Deliverables. In conjunction with and as additional (but independent)
supporting evidence for certain of the covenants, representations and warranties
made by the Company herein, at the Closing, the Company will deliver or cause to
be delivered to each Purchaser each of the following, the delivery of which will
be a condition to the Purchaser’s obligation to purchase the Subordinated Notes:

2.3.1A copy, certified by the Secretary or Assistant Secretary of the Company,
of (1) the Articles of Incorporation of Company, (2) the Bylaws of Company and
(3) the resolutions of the Board of Directors authorizing the issuance of the
Subordinated Notes and the execution, delivery and performance of the
Transaction Documents;

2.3.2A good standing certificate of the Company issued by the Secretary of State
of the State of Louisiana;

2.3.3An incumbency certificate of the Secretary or Assistant Secretary of
Company certifying the names of the officer or officers of the Company
authorized to sign this Agreement, the Subordinated Notes and the other
documents provided for in this Agreement, together with a sample of the true
signature of each such officer (a Purchaser may conclusively rely on such
certificate until formally advised by a like certificate of any changes
therein);

2.3.4An opinion of counsel to Company, dated as of the Closing Date,
substantially in the form of Exhibit B attached hereto and addressed to the
Purchasers;

2.3.5Such other additional information regarding the Company and its assets,
liabilities (including any liabilities arising from, or relating to, legal
proceedings) and contracts as a Purchaser may reasonably request; and

2.3.6Such other certificates, affidavits, schedules, resolutions or notes as are
provided for hereunder or as a Purchaser may reasonably request.

3.REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to each Purchaser as follows:
3.1Organization and Authority. Each of the Company and its Subsidiaries is a
corporation, bank or other entity duly organized and validly existing under the
Laws of the jurisdiction of its incorporation or organization, is duly qualified
to do business and is in good standing in all jurisdictions where its ownership
or leasing of property or the conduct of its business requires it to be so
qualified except where any failure to be so qualified would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect,
and has the corporate or other organizational power and authority to own its
properties and assets and to carry on its business as it is now being conducted.
The Company is duly registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended, and under applicable state Laws.

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3.2    Company Subsidiaries. The Company owns, directly or indirectly, all of
its interests in each Subsidiary of the Company free and clear of any and all
Liens. The deposit accounts of the Bank are insured by the FDIC to the fullest
extent permitted by the Federal Deposit Insurance Act, as amended, and the rules
and regulations of the FDIC thereunder, and all premiums and assessments
required to be paid in connection therewith have been paid when due (after
giving effect to any applicable extensions). The Company beneficially owns all
of the outstanding capital securities and has sole control of the Bank.

3.3    Authorization; No Conflicts; No Default.

3.3.1The Company has the corporate power and authority to execute and deliver
the Transaction Documents and to perform its obligations thereunder. The
execution, delivery and performance of the Transaction Documents by the Company
and the consummation of the transactions contemplated thereby have been duly
authorized by all necessary corporate action on the part of the Company. No
other corporate proceedings are necessary for the execution and delivery by the
Company of the Transaction Documents, the performance by it of its obligations
thereunder or the consummation by it of the transactions contemplated thereby.
The Transaction Documents have been duly and validly executed and delivered by
the Company and, assuming due authorization, execution and delivery by each
Purchaser and the other parties thereto, are the valid and binding obligations
of the Company enforceable against the Company in accordance with their
respective terms, except as enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer and similar Laws of
general applicability relating to or affecting creditors’ rights or by general
equity principles (whether applied in equity or at law).

3.3.2Neither the execution and delivery by the Company of the Transaction
Documents nor the consummation of the transactions contemplated thereby, nor
compliance by the Company with any of the provisions hereof or thereof, will (1)
violate, conflict with, or result in a breach of any provision of, or constitute
a default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or result in the
loss of any benefit or creation of any right on the part of any third party
under, or accelerate the performance required by, or result in a right of
termination or acceleration of, or result in the creation of any lien, charge,
adverse right or claim, pledge, covenant, title defect, security interest and
other encumbrance of any kind (“Lien”) upon any of the properties or assets of
the Company or any Subsidiary of the Company, under any of the terms, conditions
or provisions of (i) the articles of incorporation, charter or bylaws (or
similar governing documents) of the Company or any of its Subsidiaries or (ii)
any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or
other instrument or obligation to which the Company or any of its Subsidiaries
is a party or by which it may be bound, or to which the Company or any of its
Subsidiaries, or any of the properties or assets of the Company or any of its
Subsidiaries may be subject, or (2) violate any Law or regulation applicable to
the Company or any of its Subsidiaries or any of their respective properties or
assets, except in the case of clauses (1)(ii) and (2) of this paragraph for such
violations, conflicts and breaches as would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.

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3.3.3None of the Company, the Bank or any other Subsidiary of the Company 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 other agreement or
instrument to which the Company, Bank or any other Subsidiary of the Company is
a party or by which the Company, the Bank or any other Subsidiary of the Company
or their respective 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. For purposes of this Agreement,
“Indebtedness” means: (1) 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 (2) all obligations secured by any lien in property owned by the
Company whether or not such obligations will have been assumed; provided,
however, Indebtedness will 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, Federal Reserve Bank, secured deposits of
municipalities and repurchase arrangements) and consistent with customary
banking practices and applicable Laws and regulations.

3.4    Governmental and Other Consents. No orders, permissions, consents,
approvals or authorizations from any Governmental Entity 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.

3.5    Litigation and Other Proceedings. Except as would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect,
there is no pending or, to the Knowledge of the Company, threatened claim,
action, suit, arbitration, complaint, charge or investigation or proceeding
against the Company or any of its Subsidiaries or any of its assets, rights or
properties, nor is the Company or any of its Subsidiaries a party or named as
subject to the provisions of any order, writ, injunction, settlement, judgment
or decree of any court, arbitrator or government agency, or instrumentality. The
Company is in material compliance with all existing decisions, orders, and
agreements of or with Governmental Entities to which it is subject or bound.

3.6    Financial Statements. The Company Financial Statements (including the
related notes, where applicable), which have been provided 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 stockholders’ 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, as indicated in such statements or in the notes thereto.

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3.7    Reports. Since December 31, 2018, the Company and each Subsidiary of the
Company have filed all material reports, registrations, documents, filings,
statements and submissions, together with any required amendments thereto, that
were required to be filed with any Governmental Entity (collectively, the
“Company Reports”) and have paid all material fees and assessments due and
payable in connection therewith. As of their respective filing dates, the
Company Reports complied in all material respects with all Laws, as the case may
be.

3.8    Books and Records; Internal Accounting and Disclosure Controls. The books
and records of the Company and its Subsidiaries are complete and correct in all
material respects. No written or, to the Knowledge of the Company, oral notice
or allegation of any material inaccuracies or discrepancies in such books and
records has been received by the Company. The records, systems, controls, data
and information of the Company and its Subsidiaries are recorded, stored,
maintained and operated under means, including any electronic, mechanical or
photographic process, whether computerized or not, that are under the exclusive
ownership and direct control of the Company or its Subsidiaries or accountants,
including all means of access thereto and therefrom, except for any
non-exclusive ownership and non-direct control that would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

3.9    Off Balance Sheet Arrangements. There is no transaction, arrangement, or
other relationship between the Company or any of its Subsidiaries and an
unconsolidated or other affiliated entity that is not reflected on the Company
Financial Statements.

3.10    Risk Management Instruments. All material derivative instruments,
including swaps, caps, floors and option agreements entered into for the
Company’s or any of its Subsidiaries’ own account were entered into only in the
ordinary course of business, in accordance with prudent practices and in all
material respects with all applicable Laws, and with counterparties believed to
be financially responsible at the time; and each of them constitutes the valid
and legally binding obligation of the Company or its Subsidiary, as applicable,
enforceable in accordance with its terms, except as enforcement may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and similar Laws of general applicability relating to or affecting
creditors’ rights or by general equity principles, whether applied in equity or
at law. Neither the Company nor, to the Knowledge of the Company, any other
parties thereto is in breach of any of its material obligations under any such
agreement or arrangement.

3.11    No Undisclosed Liabilities. There are no liabilities of the Company or
any of its Subsidiaries of any kind whatsoever, whether accrued, contingent,
absolute, determined, determinable or otherwise, except for liabilities
adequately reflected or reserved against in accordance with GAAP in the Company
Financial Statements and liabilities that have arisen in the ordinary and usual
course of business and consistent with past practice since December 31, 2018,
and that have not or would not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect.

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3.12    Absence of Certain Changes. Since January 1, 2019, except as Previously
Disclosed, (1) the Company and the Company Subsidiaries have conducted their
respective businesses in all material respects in the ordinary and usual course
of business consistent with past practices, (2) none of the Company or any
Company Subsidiary has incurred any material liability or obligation, direct or
contingent, for borrowed money, except borrowings in the ordinary course of
business, (3) the Company has not made or declared any distribution in cash or
in kind to its shareholders or issued or repurchased any shares of its capital
stock, except for quarterly dividends to holders of Company common stock, (4)
through (and including) the date of this Agreement, no fact, event, change,
condition, development, circumstance or effect has occurred that has had or
would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, and (5) no material default (or event which, with
notice or lapse of time, or both, would constitute a material default) exists on
the part of the Company or any Company Subsidiary or, to the Knowledge of the
Company, on the part of any other party, in the due performance and observance
of any term, covenant or condition of any agreement to which the Company or any
Company Subsidiary is a party and which would reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.

3.13    Compliance with Laws. The Company and each of its 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 and each such Subsidiary, except where
the failure to have such permits, licenses, franchises, authorizations, orders
and approvals, or to have made such filings, applications and registrations,
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect. Except as Previously Disclosed or where disclosure is
prohibited by Law, the Company and each Subsidiary of the Company have complied
in all material respects and (1) are not in default or violation in any respect
of, (2) to the Company’s Knowledge, are not under investigation with respect to,
and (3) to the Company’s Knowledge, have not been threatened to be charged with
or given notice of any material violation of, any applicable material 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 (each, a “Law”), other than such
noncompliance, defaults or violations that would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect. Except for
statutory or regulatory restrictions of general application, no Governmental
Entity has placed any material restriction on the business or properties of the
Company or any of its Subsidiaries. As of the date hereof, the Bank has a
Community Reinvestment Act rating of “satisfactory” or better.

3.14    Agreements with Regulatory Agencies. Except as Previously Disclosed or
where disclosure is prohibited by Law, neither the Company nor any Company
Subsidiary (1) is subject to any cease-and-desist or other similar order or
enforcement action issued by, (2) is a party to any written agreement, consent
agreement or memorandum of understanding with, (3) is a party to any commitment
letter or similar undertaking to, (4) is subject to any capital directive by, or
(5) since December 31, 2018, has adopted any board resolutions at the request
of, any Governmental Entity 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, its internal
controls, or its management (each item in this sentence, a “Regulatory
Agreement”), nor has the Company nor any of its Subsidiaries been advised since
December 31, 2018, by any Governmental Entity that it is considering issuing,
initiating, ordering, or requesting any such Regulatory Agreement.

3.15    Brokers and Finders. Except for commissions paid to the Placement Agent,
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.

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3.16    Tax Matters. The Company and each of its Subsidiaries has (1) 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 (2) paid all material
taxes required to be paid by it and any other material assessment, fine or
penalty levied against it other than taxes (A) currently payable without penalty
or interest, or (B) being contested in good faith by appropriate proceedings.

3.17    Offering of Securities. Neither the Company nor any Person acting on its
behalf has taken any action which would subject the offering, issuance or sale
of the Subordinated Notes to the registration requirements of the Securities
Act. Neither the Company nor any Person acting on its behalf has engaged in any
form of general solicitation or general advertising (within the meaning of
Regulation D under the Securities Act) in connection with any offer or sale of
the Subordinated Notes. Assuming the accuracy of each Purchaser’s
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.

3.18    Investment Company Status. The Company is not, and upon consummation of
the issuance and sale of the Subordinated Notes will not be, an “investment
company,” a company controlled by an “investment company” or an “affiliated
Person” of, or “promoter” or “principal underwriter” of, an “investment
company,” as such terms are defined in the Investment Company Act of 1940, as
amended.

3.19    No Misstatement. None of the representations, warranties, covenants and
agreements made in this Agreement or in any certificate or other document
delivered to the Purchasers by or on behalf of the Company under or in
connection with 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 and as of the Closing Date.

4.    REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.

Each Purchaser, severally and not jointly, represents and warrants to the
Company, and covenants with the Company, as follows:
4.1    Legal Power and Authority. Purchaser has all necessary power and
authority to execute, deliver and perform its obligations under this Agreement
and to consummate the transactions contemplated hereby. Purchaser is an entity
duly organized, validly existing and in good standing under the Laws its
jurisdiction of organization.

4.2    Authorization and Execution. The execution, delivery and performance of
this Agreement has been duly authorized by all necessary action on the part of
such Purchaser, and assuming due authorization, execution and delivery by the
other parties hereto, this Agreement is 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.

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4.3    No Conflicts. Neither the execution, delivery or performance of the
Transaction Documents nor the consummation of any of the transactions
contemplated thereby 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 (1) Purchaser’s organizational documents, (2) any agreement to which it is
party, (3) any Law applicable to it, or (4) any order, writ, judgment,
injunction, decree, determination or award binding upon or affecting it.

4.4    Purchase for Investment. Purchaser is purchasing the Subordinated Notes
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.
Purchaser 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.

4.5    Institutional Accredited Investor. Purchaser is (i) an institutional
“accredited investor” as such term is defined in Rule 501(a) of Regulation D and
as contemplated by subsection (1), (2), (3) or (7) of Rule 501(a) of Regulation
D, and has no less than $5,000,000 in total assets, or (ii) a QIB.

4.6    Financial and Business Sophistication. Purchaser 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 and
of making an informed investment decision, and has so evaluated the merits and
risks of such investment. Purchaser has relied solely upon its own knowledge of,
and/or 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.

4.7    Ability to Bear Economic Risk of Investment. Purchaser recognizes that an
investment in the Subordinated Notes involves substantial risk. Purchaser has
the ability to bear the economic risk of the prospective investment in the
Subordinated Notes or any other securities of the Company, 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.

4.8    Information. Purchaser 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 or any other securities of the
Company; (ii) it has conducted, to its satisfaction, its own examination of the
Company and its business (including the Subsidiaries of the Company and their
respective businesses), as well as the terms and conditions of the Subordinated
Notes to the extent it deems necessary to make its decision to invest in the
Subordinated Notes; (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 (including meeting with
representatives of the Company); and (iv) it has not received nor relied on any
form of general solicitation or general advertising (within the meaning of
Regulation D) from the Company or the Placement Agent in connection with the
offer and sale of the Subordinated Notes. Purchaser has reviewed or had access
to the information set forth in the Company Financial Statements, the other
information contained in the data room established by the Company in connection
with the transactions contemplated by this Agreement, and all other information
Previously Disclosed.

--------------------------------------------------------------------------------

4.9    Access to Information. Purchaser 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.

4.10    Investment Decision. Purchaser 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 Agent. Neither such inquiries nor any other due
diligence investigations conducted by it or its advisors or representatives, if
any, will modify, amend or affect its right to rely on the Company’s
representations and warranties contained herein. Purchaser 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 Agent, except for the express statements, representations and
warranties of the Company made or contained in this Agreement. Furthermore,
Purchaser acknowledges that (i) the Placement Agent has 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.

4.11    Private Placement; No Registration; Restricted Legends. Purchaser
understands and acknowledges that the Subordinated Notes are characterized as
“restricted securities” under the Securities Act and are being sold by the
Company in a transaction not involving a public offering and 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
promulgated under Section 4(a)(2) of the Securities Act and Section 18 of the
Securities Act, or any state securities Laws, and accordingly, may be resold,
pledged or otherwise transferred only in compliance with the registration
requirements of federal and state securities Laws or if exemptions from the
Securities Act and applicable state securities Laws are available to it.
Purchaser is not subscribing for the Subordinated Notes as a result of or
subsequent to 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.

4.12    Placement Agent. Purchaser will purchase the Note(s) directly from the
Company and not from the Placement Agent and understands that neither the
Placement Agent nor any other broker or dealer has any obligation to make a
market in the Subordinated Notes.

4.13    Accuracy of Representations. Purchaser understands that each of the
Placement Agent and the Company will rely upon the truth and accuracy of the
foregoing representations, acknowledgements and agreements in connection with
the transactions contemplated by this Agreement.

5.    ADDITIONAL AGREEMENTS.

5.1DTC Registration. Upon the request of a Holder of a Note that is a QIB and
provided that the applicable depository eligibility requirements are met, the
Company will use commercially reasonable efforts to cause the Subordinated Notes
held by such QIB to be registered in the name of Cede & Co. as nominee of The
Depository Trust Company (“DTC”) or a nominee of DTC.

--------------------------------------------------------------------------------

5.2Bloomberg; Rule 144 Information. The Company will use commercially reasonable
efforts to cause the Subordinated Notes to be quoted on Bloomberg. While any
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.

5.3No Control. Each Purchaser agrees that it will not, without the prior consent
of the Company, contribute capital to the Company or acquire an amount of voting
securities of the Company that in either case would cause such Purchaser to be
deemed to control the Company for purposes of the Bank Holding Company Act of
1956, as amended, or the Change in Bank Control Act of 1978, as amended, or
applicable state Law.

5.4Legend.

5.4.1All certificates or other instruments, if any, representing the
Subordinated Notes subject to this Agreement will bear a legend substantially to
the effect of the restrictive legend set forth on the face of the form of
Subordinated Note attached hereto as Exhibit A.

5.4.2Subject to this Section 5.4.2, such restrictive legend will be removed and
the Company will issue a certificate without such legend to the holder of a Note
(the “Holder”) upon which it is stamped or issue to such Holder by electronic
delivery at the applicable balance account at DTC, as applicable, if (1) such
Note is registered for resale under the Securities Act, (2) such Note is sold or
transferred in accordance with Rule 144 (if the transferor is not an Affiliate
of the Company), or (3) such Note is eligible for sale under Rule 144, without
the requirement for the Company to be in compliance with the current public
information required under Rule 144 as to such securities and without volume or
manner of sale restrictions. Any fees associated with the removal of such
legend, other than with respect to a Purchaser’s or Holder’s counsel, will be
borne by the Company. If the legend is no longer required as a result of the
foregoing, the Company will, no later than three Business Days following the
delivery by a Purchaser or Holder to the Company of a legended certificate or
instrument representing such Note, properly endorsed or with stock powers
attached, signatures guaranteed, and together with such other documents as may
reasonably requested by the Company, the Company will deliver or cause to be
delivered to such Purchaser or Holder a certificate or instrument, as the case
may be, representing such Note without such legend.

5.5Information Available to Facilitate Resales; Resale Registration Statement.

5.5.1With a view to making available to the Purchaser or Holder the benefits of
certain rules and regulations of the Commission permitting the sale of the
Subordinated Notes without registration as soon as allowed, the Company will, at
all times from the date of this Agreement through the date that the restrictive
legend is eligible for removal from all Notes pursuant to Section 5.4.2, make
and keep available adequate current public information with respect to the
Company, as those terms are understood and defined in Rule 144(c) or any similar
or analogous rules promulgated under the Securities Act, and, upon written
request by the Purchaser or Holder, Company will provide a written statement
that Company has complied with such requirements.

5.5.2Subject to the terms and conditions of this Agreement, the Company will
provide to the Purchasers the resale registration rights described in Exhibit C
of this Agreement.

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5.6Secondary Market Transactions. Each Purchaser will have the right at any time
and from time to time to securitize the 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 will, at the Company’s expense, use
all reasonable efforts and cooperate fully and in good faith with such Purchaser
and otherwise assist the Purchaser in satisfying the market standards to which
the Purchaser customarily adheres or which may be reasonably required in the
marketplace or by applicable rating agencies in connection with any such
Secondary Market Transactions, but in no event will the Company be required to
incur, without reimbursement, more than an aggregate of $10,000 in costs or
expenses in connection with any and all Secondary Market Transactions. Subject
to any written confidentiality obligation, including the terms of any
non-disclosure agreements between the Purchasers and the Company, all
information regarding the Company may be furnished to any Purchaser and to any
Person reasonably deemed necessary by the 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 nondisclosure agreement between the Purchaser and the Company.

5.7Transfer Taxes. On the Closing Date, all transfer or other similar taxes
which are required to be paid in connection with the sale and transfer of the
Subordinated Notes to be sold to the Purchasers hereunder will be, or will have
been, fully paid or provided for by the Company, and all Laws imposing such
taxes will be or will have been complied with in all material respects.

5.8Tier 2 Capital. If at any time the Company is subject to consolidated capital
requirements under applicable regulations of the Federal Reserve and after such
time all or any portion of the Note ceases to be deemed to be Tier 2 Capital,
other than due to the limitation imposed on the capital treatment of
subordinated debt during the five years immediately preceding the maturity date
of the Note, the Company will promptly notify the Purchasers, and thereafter,
subject to the Company’s right to redeem the Subordinated Notes under such
circumstances pursuant to the terms of the Subordinated Notes, if requested by
the Company, 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.

5.9Use of Proceeds. The Company intends to use the net proceeds from the
issuance of the Subordinated Notes hereunder to fund future acquisitions and for
general corporate purposes, including investments in the Bank.

6.MISCELLANEOUS.

6.1Survival. Each of the representations and warranties set forth in this
Agreement will survive the Closing under this Agreement for a period of one
year. Except as otherwise provided herein, all covenants and agreements
contained herein will survive until, by their respective terms, they are no
longer operative, other than those which by their terms are to be performed in
whole or in part prior to or on the Closing Date, which will terminate as of the
Closing Date.

6.2Expenses. 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 by this Agreement.

--------------------------------------------------------------------------------

6.3Waiver or Amendment. No amendment or waiver of any provision of this
Agreement will be effective with respect to any party unless made in writing and
signed by an officer of a duly authorized representative of such party. No
failure or delay by any party in exercising any right, power or privilege
hereunder will operate as a waiver thereof nor will any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The conditions to each party’s
obligation to consummate the Closing are for the sole benefit of such party and
may be waived by such party in whole or in part to the extent permitted by
applicable Law. No waiver of any party to this Agreement will be effective
unless it is in a writing signed by a duly authorized officer of the waiving
party that makes express reference to the provision or provisions subject to
such waiver. The rights and remedies herein provided will be cumulative and not
exclusive of any rights or remedies provided by Law.

6.4Successors and Assigns.

6.4.1At or prior to the Closing, this Agreement will not be assignable by
operation of law or otherwise, and any attempted assignment in contravention
hereof will be null and void; provided that each Purchaser may assign its rights
and obligations under this Agreement to any Affiliate, but only if the
transferee agrees in writing for the benefit of the Company (with a copy thereof
to be furnished to the Company) to be bound by the terms of this Agreement (any
such transferee will be included in the term “Purchaser”); provided, further,
that no such assignment will relieve such Purchaser of its obligations
hereunder.
 
6.4.2Following Closing, this Agreement will inure to the benefit of the parties
and their respective heirs, legal representatives, successors and assigns;
except that the term “successors and assigns” will not include a purchaser of
any of the Subordinated Notes from any Purchaser merely because of such purchase
but will include a purchaser of any of the Subordinated Notes in accordance with
an assignment complying with the assignment form attached to the Subordinated
Notes.

6.5Captions; 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
will be deemed to be an original and all of which taken together will 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 will 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.

6.6Governing Law. This Agreement will 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.

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6.7Waiver Of Right To Jury Trial. TO THE EXTENT PERMITTED UNDER APPLICABLE LAW,
THE PARTIES 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 (III)
THIS WAIVER WILL BE EFFECTIVE AS TO EACH OF SUCH TRANSACTION DOCUMENTS AS IF
FULLY INCORPORATED THEREIN.

6.8Notices. Any notices, requests, instructions and other communications
required or permitted to be given under this Agreement after the date of this
Agreement by any party hereto to any other party may be delivered personally or
by nationally recognized overnight courier service or sent by U.S. mail or by
facsimile transmission or electronic mail, at the respective addresses or
transmission numbers set forth below and is deemed delivered (a) in the case of
personal delivery, facsimile transmission or electronic mail, when received;
(b) in the case of mail, upon the earlier of actual receipt or five Business
Days after deposit in the United States Postal Service, first class certified or
registered mail, postage prepaid, return receipt requested; and (c) in the case
of an overnight courier service, one Business Day after delivery to such courier
service with instructions for overnight delivery. Each party may change its
contact information by written notice to all other parties, sent as provided in
this Section. All communications must be in writing and addressed as follows:

if to the Company:        Investar Holding Corporation
10500 Coursey Boulevard, 3rd Floor
Baton Rouge, Louisiana 70816
Attention: John J. D’Angelo

with a copy to:            Fenimore, Kay, Harrison & Ford, LLP
812 San Antonio St., Suite 600
Austin, Texas 78701
Attn: Stephanie E. Kalahurka

if to a Purchaser:        To the address indicated on the Purchaser’s signature
page

6.9    Entire Agreement. This Agreement and the Subordinated Notes 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 as set forth
herein. 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 or in the Subordinated Notes.

6.10    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, will be of no effect and,
in such case, all the remaining terms and provisions of this Agreement will
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 will have
been held invalid or unenforceable, will not be affected thereby, but will
continue valid and enforceable to the fullest extent permitted by Law.

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

6.12    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,
will be deemed to make a Purchaser a partner or joint venturer with the Company.

6.13    Knowledge; Discretion. All references herein to a Purchaser’s or the
Company’s knowledge will 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 or individuals
performing similar functions. 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, will be deemed to mean that such Purchaser will
decide using the reasonable discretion or judgment of a prudent lender.

6.14    Time of Essence. Time is of the essence in the performance of each and
every term of this Agreement.

6.15    Public Announcements. Subject to each party’s disclosure obligations
imposed by Law, each of the parties hereto will cooperate with each other in the
development and distribution of all news releases and other public information
disclosures with respect to this Agreement and the transactions contemplated by
this Agreement, and except as otherwise permitted in the next sentence, neither
the Company nor any Purchaser will make any such news release or public
disclosure that identifies the other party without first consulting with the
other, and, in each case, also receiving the other’s consent (which will not be
unreasonably withheld or delayed), and all parties will coordinate with the
party whose consent is required with respect to any such news release or public
disclosure. In the event a party hereto is advised by its outside legal counsel
that a particular disclosure that identifies the other party is required by Law,
such party will be permitted to make such disclosure but will be obligated to
use commercially reasonable efforts to consult with the other party hereto and
take its comments into account with respect to the content of such disclosure
before issuing such disclosure.

6.16    Specific Performance. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms. It is accordingly agreed that
the parties will be entitled to seek specific performance of the terms hereof,
this being in addition to any other remedies to which they are entitled at law
or equity.

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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
duly authorized representative as of the date first above written.
COMPANY:
 
 
 
INVESTAR HOLDING CORPORATION
 
 
 
By:
 
 
 
 
John J. D’Angelo
 
 
President and Chief Executive Officer

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IN WITNESS WHEREOF, the Purchaser has caused this Agreement to be executed by
its duly authorized representative as of the date first above written.
PURCHASER:
 
 
 
 
 
 
 
 
 
By:
 
 
Name:
 
 
Title:
 
 
 
 
 
Address of Purchaser:
 
 
 
 
 
 
 
 
 
Principal Amount of Purchased Note:
$
 
 

    

--------------------------------------------------------------------------------

EXHIBIT A
FORM OF SUBORDINATED NOTE

INVESTAR HOLDING CORPORATION

5.125% FIXED TO FLOATING RATE SUBORDINATED NOTE DUE 2029

THIS OBLIGATION IS NOT A DEPOSIT AND IS NOT INSURED BY THE UNITED STATES OR ANY
AGENCY OR FUND OF THE UNITED STATES, INCLUDING THE FEDERAL DEPOSIT INSURANCE
CORPORATION. THIS OBLIGATION IS SUBORDINATED IN THE MANNER AND TO THE EXTENT SET
FORTH HEREIN, IS INELIGIBLE AS COLLATERAL FOR ANY EXTENSION OF CREDIT BY THE
ISSUER OR ANY OF ITS SUBSIDIARIES, AND IS UNSECURED.
THIS SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM
DENOMINATIONS OF $1,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED
TRANSFER OF SUCH NOTES IN A DENOMINATION OF LESS THAN $1,000 AND MULTIPLES OF
$1,000 IN EXCESS THEREOF WILL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE WILL BE DEEMED NOT TO BE THE HOLDER OF
SUCH SECURITIES FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
PAYMENTS ON SUCH SECURITIES, AND SUCH PURPORTED TRANSFEREE WILL BE DEEMED TO
HAVE NO INTEREST WHATSOEVER IN SUCH SECURITIES.
THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS. NEITHER THIS SUBORDINATED NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SUBORDINATED NOTE BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SUBORDINATED
NOTE ONLY (A) TO THE COMPANY, (B) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
(“RULE 144A”), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO A “NON U.S.
PERSON” IN AN “OFFSHORE TRANSACTION” PURSUANT TO REGULATION S UNDER THE
SECURITIES ACT, (D) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT TO AN “ACCREDITED INVESTOR” WITHIN THE MEANING OF
SUBPARAGRAPH (a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT
IS ACQUIRING THIS SUBORDINATED NOTE FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN “ACCREDITED INVESTOR,” FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO,
OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D) OR (E) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION

--------------------------------------------------------------------------------

SATISFACTORY TO IT IN ACCORDANCE WITH THE SUBORDINATED NOTE PURCHASE AGREEMENT,
A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY. THE HOLDER OF THIS
SUBORDINATED NOTE BY ITS ACCEPTANCE HEREOF AGREES THAT IT WILL COMPLY WITH THE
FOREGOING RESTRICTIONS.
THE HOLDER OF THIS SUBORDINATED NOTE BY ITS ACCEPTANCE HEREOF AGREES, REPRESENTS
AND WARRANTS THAT IT WILL NOT ENGAGE IN HEDGING TRANSACTIONS INVOLVING THIS
SECURITY UNLESS SUCH TRANSACTIONS ARE IN COMPLIANCE WITH THE SECURITIES ACT OR
AN APPLICABLE EXEMPTION THEREFROM.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER OF THIS SUBORDINATED NOTE WILL
DELIVER TO THE COMPANY SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE
REQUIRED BY THE COMPANY TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
CERTAIN ERISA CONSIDERATIONS:
EACH PURCHASER AND HOLDER OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, BY
ITS ACCEPTANCE HEREOF OR THEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT
EITHER (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN, INDIVIDUAL RETIREMENT ACCOUNT OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), A TRUSTEE OR
OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN, OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY,
OR (II) THAT SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF
AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION
96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS
PURCHASE AND HOLDING OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, ARE NOT
PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE. ANY FIDUCIARY OF
ANY PLAN WHO IS CONSIDERING THE ACQUISITION OF THIS SUBORDINATED NOTE OR ANY
INTEREST HEREIN SHOULD CONSULT WITH HIS OR HER LEGAL COUNSEL PRIOR TO ACQUIRING
THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN.

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INVESTAR HOLDING CORPORATION

5.125% FIXED TO FLOATING RATE SUBORDINATED NOTE DUE 2029

Certificate No.: 2019-FTF-00[ ]
 
CUSIP 46134L AB1
 
 
 
U.S. $_____________
 
Dated: November 12, 2019

FOR VALUE RECEIVED, Investar Holding Corporation, a Louisiana corporation (the
“Company”), promises to pay to the order of [ ], or its registered assigns
(collectively, the “Holder”), the principal amount of [PRINCIPAL AMOUNT - WORDS]
($[PRINCIPAL AMOUNT - $]), in the lawful currency of the United States of
America, or such lesser or greater amount as will then remain outstanding under
this Subordinated Note, on December 30, 2029 (the “Stated Maturity Date”), or
such other date upon which this Subordinated Note will become due and payable,
whether by reason of extension, acceleration or otherwise.
Interest on this Subordinated Note will be payable in arrears on the interest
payment dates set forth on the reverse side of this Subordinated Note, in each
case to the Holder of record on the 15th calendar day of the month in which the
relevant interest payment date occurs, without regard to whether such date is a
Business Day (such date being referred to herein as the “Regular Record Date”).
Reference is made to the further provisions of this Subordinated Note set forth
on the reverse hereof, which further provisions will for all purposes have the
same effect as if set forth at this place.

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IN WITNESS WHEREOF, the undersigned has caused this Subordinated Note to be duly
executed.
        
INVESTAR HOLDING CORPORATION
 
 
 
 
By:
 
 
John J. D’Angelo
 
President and Chief Executive Officer

This evidences a Subordinated
Note referred to in the within
mentioned Registrar
and Paying Agent Agreement:

WILMINGTON TRUST, NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Paying Agent

By:
 
 
Name:
 
Title:
 
 
Date:
 

 

[Signature Page to Subordinated Note]

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[REVERSE SIDE OF NOTE]

INVESTAR HOLDING CORPORATION
5.125% FIXED TO FLOATING RATE SUBORDINATED NOTES DUE 2029

1.Subordinated Notes. This note is one of a duly authorized issue of notes of
the Company designated as the “5.125% Fixed to Floating Rate Subordinated Notes
due 2029” (the “Subordinated Note,” and collectively, the “Subordinated Notes”)
initially issued on November 12, 2019 (the “Issue Date”) under that certain
Subordinated Note Purchase Agreement, dated as of the Issue Date, between the
Company and the several purchasers identified on the signature pages thereto
(the “Agreement”). The Subordinated Notes are intended to be treated as tier 2
capital (or its then equivalent if the Company were subject to such capital
requirement) for purposes of capital adequacy guidelines of the Board of
Governors of the Federal Reserve System (or any successor regulatory authority
with jurisdiction over bank holding companies) (the “Federal Reserve”) as then
in effect and applicable to the Company.

2.Interest.

(a)Computation and Payment of Interest. This Subordinated Note will bear
interest on any outstanding principal (i) from and including the Issue Date to
but excluding December 30, 2024 (the “Fixed-Rate Period End Date”), unless
redeemed prior to such date, payable semi-annually in arrears on March 30 and
September 30 of each year, beginning March 30, 2020, through the Fixed-Rate
Period End Date or earlier Redemption Date (as defined herein)(each, a “Fixed
Interest Payment Date”) at simple interest of 5.125% per annum (the “Fixed
Interest Rate”); and (ii) from and including the Fixed-Rate Period End Date to
but excluding the Stated Maturity Date (the “Floating-Rate Period”), unless
redeemed prior to such date, at the rate per annum, reset quarterly, equal to
the Benchmark plus 349 basis points (the “Floating Interest Rate”), payable
quarterly in arrears on March 30, June 30, September 30 and December 30 of each
year during the Floating-Rate Period through the Stated Maturity Date or earlier
Redemption Date, with a final payment due not later than the Stated Maturity
Date (each, a “Floating Interest Payment Date” and, together with each Fixed
Interest Payment Date, an “Interest Payment Date”). The payments of interest and
principal, if any, due on any Interest Payment Date will be paid to the holders
of record on Regular Record Date. Interest, whether based on the Fixed Interest
Rate or the Floating Interest Rate, will be computed on the basis of 30-day
months and a year of 360 days and, for any period of less than a month, on the
number of days actually elapsed. Payments of principal of and interest on this
Subordinated Note will be made by transfer of immediately available funds to a
bank account designated to the Company by the Holder or otherwise by check
mailed to the registered Holder, as such person’s address appears on the
Security Register.

(b)Effect of Benchmark Transition Event.

(i)Benchmark Replacement. If the Company or its designee (the “Designee”)
reasonably determines in good faith that a Benchmark Transition Event and its
related Benchmark Replacement Date (each as defined below) have occurred prior
to the Reference Time (as defined below) in respect of any determination of the
Benchmark (as defined below) on any date, the Benchmark Replacement (as defined
below) will replace the then-current Benchmark for all purposes relating to this
Subordinated Note in respect of such determination on such date and all
determinations on all subsequent dates.

(ii)Benchmark Replacement Conforming Changes. In connection with the
implementation of a Benchmark Replacement, the Company or its designee will have
the right to make Benchmark Replacement Conforming Changes (as defined below)
from time to time.

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(iii)Decisions and Determinations. Any determination, decision or election that
may be made by the Company or its designee under this Section 2(b), including
any determination with respect to a tenor, rate or adjustment or of the
occurrence or non-occurrence of an event, circumstance or date and any decision
to take or refrain from taking any action or any selection, will be conclusive
and binding absent manifest error, may be made in the Company or its designee’s
sole discretion, and, notwithstanding anything to the contrary in the
documentation relating to the Subordinated Notes, will become effective without
consent from any other party.

(iv)Certain Defined Terms. As used in this Section, the following terms have the
meanings set forth below:

(A)“Benchmark” means, initially, LIBOR; provided that if a Benchmark Transition
Event and its related Benchmark Replacement Date have occurred with respect to
LIBOR or the then-current Benchmark, then “Benchmark” means the applicable
Benchmark Replacement. All percentages used in or resulting from any calculation
of the Benchmark will be rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point, with 0.000005% rounded up to 0.00001%.

(B)“Benchmark Replacement” means the Interpolated Benchmark with respect to the
then-current Benchmark plus the Benchmark Replacement Adjustment for such
Benchmark; provided that if the Company or its designee cannot determine the
Interpolated Benchmark as of the Benchmark Replacement Date, then “Benchmark
Replacement” means the first alternative set forth in the order below that can
be determined by the Company or its designee as of the Benchmark Replacement
Date: (1) the sum of Term SOFR and the Benchmark Replacement Adjustment; (2) the
sum of Compounded SOFR and the Benchmark Replacement Adjustment; (3) the sum of
the alternate rate of interest that has been selected or recommended by the
Relevant Governmental Body as the replacement for the then-current Benchmark for
the applicable Corresponding Tenor and the Benchmark Replacement Adjustment; (4)
the sum of the ISDA Fallback Rate and the Benchmark Replacement Adjustment; or
(5) the sum of the alternate rate of interest that has been selected by the
Company or its designee as the replacement for the then-current Benchmark for
the applicable Corresponding Tenor giving due consideration to any
industry-accepted rate of interest as a replacement for the then-current
Benchmark for U.S. dollar denominated floating rate notes at such time and the
Benchmark Replacement Adjustment.

(C)“Benchmark Replacement Adjustment” means the first alternative set forth in
the order below that can be determined by the Company or its designee as of the
Benchmark Replacement Date: (1) the spread adjustment, or method for calculating
or determining such spread adjustment (which may be a positive or negative value
or zero) that has been selected or recommended by the Relevant Governmental Body
for the applicable Unadjusted Benchmark Replacement; (2) if the applicable
Unadjusted Benchmark Replacement is equivalent to the ISDA Fallback Rate, then
the ISDA Fallback Adjustment; and (3) the spread adjustment (which may be a
positive or negative value or zero) that has been selected by the Company or its
designee giving due consideration to any industry-accepted spread adjustment, or
method for calculating or determining such spread adjustment, for the
replacement of the then-current Benchmark with the applicable Unadjusted
Benchmark Replacement for U.S. dollar denominated floating rate notes at such
time.
(D)“Benchmark Replacement Conforming Changes” means, with respect to any
Benchmark Replacement, any technical, administrative or operational changes
(including changes to the definition of “Floating-Rate Period,” timing and
frequency of determining rates and making payments of interest, and other
administrative matters) that the Company or its designee decides may be
appropriate to reflect the adoption of such Benchmark Replacement in a manner
substantially consistent with market practice (or, if the Company or its
designee reasonably decides in good faith that adoption of any portion of

--------------------------------------------------------------------------------

such market practice is not administratively feasible or if the Company or its
designee reasonably determines in good faith that no market practice for use of
the Benchmark Replacement exists, in such other manner as the Company or its
designee determines is reasonably necessary).

(E)“Benchmark Replacement Date” means the earliest to occur of the following
events with respect to the then-current Benchmark: (1) in the case of clause (1)
or (2) of the definition of “Benchmark Transition Event,” the later of the date
of the public statement or publication of information referenced therein and the
date on which the administrator of the Benchmark permanently or indefinitely
ceases to provide the Benchmark; or (2) in the case of clause (3) of the
definition of “Benchmark Transition Event,” the date of the public statement or
publication of information referenced therein. For the avoidance of doubt, if
the event giving rise to the Benchmark Replacement Date occurs on the same day
as, but earlier than, the Reference Time in respect of any determination, the
Benchmark Replacement Date will be deemed to have occurred prior to the
Reference Time for such determination.

(F)“Benchmark Transition Event” means the occurrence of one or more of the
following events with respect to the then-current Benchmark: (1) a public
statement or publication of information by or on behalf of the administrator of
the Benchmark announcing that such administrator has ceased or will cease to
provide the Benchmark, permanently or indefinitely, provided that, at the time
of such statement or publication, there is no successor administrator that will
continue to provide the Benchmark; (2) a public statement or publication of
information by the regulatory supervisor for the administrator of the Benchmark,
the central bank for the currency of the Benchmark, an insolvency official with
jurisdiction over the administrator for the Benchmark, a resolution authority
with jurisdiction over the administrator for the Benchmark or a court or an
entity with similar insolvency or resolution authority over the administrator
for the Benchmark, which states that the administrator of the Benchmark has
ceased or will cease to provide the Benchmark permanently or indefinitely,
provided that, at the time of such statement or publication, there is no
successor administrator that will continue to provide the Benchmark; or (3) a
public statement or publication of information by the regulatory supervisor for
the administrator of the Benchmark announcing that the Benchmark is no longer
representative.

(G)“Compounded SOFR” means the compounded average of SOFRs for the applicable
Corresponding Tenor, with the rate, or methodology for this rate, and
conventions for this rate (which will be compounded in arrears with a lookback
and/or suspension period as a mechanism to determine the interest amount payable
prior to the end of each interest period) being established by the Company or
its designee in accordance with: (1) the rate, or methodology for this rate, and
conventions for this rate selected or recommended by the Relevant Governmental
Body for determining compounded SOFR; provided that: (2) if, and to the extent
that, the Company or its designee determines that Compounded SOFR cannot be
determined in accordance with clause (1) above, then the rate, or methodology
for this rate, and conventions for this rate that have been selected by the
Company or its designee giving due consideration to any industry-accepted market
practice for U.S. dollar denominated floating rate notes at such time.

(H)“Corresponding Tenor” with respect to a Benchmark Replacement means a tenor
(including overnight) having approximately the same length (disregarding
business day adjustment) as the applicable tenor for the then-current Benchmark.

(I)“Federal Reserve Bank of New York’s Website” means the website of the Federal
Reserve Bank of New York at http://www.newyorkfed.org, or any successor source.

(J)“Interpolated Benchmark” with respect to the Benchmark means the rate
determined for the Corresponding Tenor by interpolating on a linear basis
between: (1) the Benchmark

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for the longest period (for which the Benchmark is available) that is shorter
than the Corresponding Tenor and (2) the Benchmark for the shortest period (for
which the Benchmark is available) that is longer than the Corresponding Tenor.

(K)“ISDA Definitions” means the 2006 ISDA Definitions published by the
International Swaps and Derivatives Association, Inc. or any successor thereto,
as amended or supplemented from time to time, or any successor definitional
booklet for interest rate derivatives published from time to time.

(L)“ISDA Fallback Adjustment” means the spread adjustment (which may be a
positive or negative value or zero) that would apply for derivatives
transactions referencing the ISDA Definitions to be determined upon the
occurrence of an index cessation event with respect to the Benchmark for the
applicable tenor.

(M) “ISDA Fallback Rate” means the rate that would apply for derivatives
transactions referencing the ISDA Definitions to be effective upon the
occurrence of an index cessation date with respect to the Benchmark for the
applicable tenor excluding the applicable ISDA Fallback Adjustment.

(N) “LIBOR” means, the offered rate for deposits in U.S. dollars having a
maturity of three months, as displayed on Bloomberg Page BBAM1 (or any successor
or substitute page of such service, or any successor to such service selected by
the Company) for the purpose of displaying the London interbank rates for U.S.
dollars as of the Reference Time (or, if LIBOR has not been published as of the
Reference Time, as of the first preceding day for which LIBOR was published).

(O)“Reference Time” with respect to any determination of the Benchmark means (1)
if the Benchmark is LIBOR, 11:00 a.m. (London time) on the day that is two
London Banking Days preceding the date of such determination, and (2) if the
Benchmark is not LIBOR, the time determined by the Company or its designee in
accordance with the Benchmark Replacement Conforming Changes. The term “London
Banking Day” means a day on which commercial banks are open for business,
including dealings in foreign exchange and foreign currency deposits, in London.

(P)“Relevant Governmental Body” means the Federal Reserve Board and/or the
Federal Reserve Bank of New York, or a committee officially endorsed or convened
by the Federal Reserve Board and/or the Federal Reserve Bank of New York or any
successor thereto.

(Q)“SOFR” with respect to any day means the secured overnight financing rate
published for such day by the Federal Reserve Bank of New York, as the
administrator of the benchmark, (or a successor administrator) on the Federal
Reserve Bank of New York’s Website.

(R)“Term SOFR” means the forward-looking term rate for the applicable
Corresponding Tenor based on SOFR that has been selected or recommended by the
Relevant Governmental Body.

(S)“Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding
the Benchmark Replacement Adjustment.

(v)The Company will notify the Paying Agent in writing of the Floating Interest
Rate on the Floating-Rate Period and of any Benchmark Transition Event,
Benchmark Replacement Date, Benchmark Replacement Adjustment, Benchmark
Replacement, Benchmark Conforming Changes and any

--------------------------------------------------------------------------------

other matters relating to the modifications to the Benchmark. The Paying Agent
will have no liability for the failure or delay of the Company to provide the
rate to the Paying Agent. In no event will the Paying Agent, in any capacity,
have the obligation to calculate or verify the Floating Interest Rate.
Wilmington Trust, National Association, neither in its role as Paying Agent, nor
in any other capacity, will serve as the Designee of the Company for purposes of
determining the effect of a Benchmark Transition Event or making the
determinations set forth in this Section 2(b). Wilmington Trust, National
Association, neither as Paying Agent nor in any other capacity, will have any
(i) responsibility or liability for the selection, adoption or determination of
an alternative or replacement reference rate (including a Benchmark Replacement
Adjustment or any Benchmark Conforming Changes) as a successor or replacement
benchmark (including whether any such rate is the appropriate Benchmark
Replacement or whether any other conditions to the designation of such rate or
any of the determinations described this Section 2(b) have been satisfied) and
will be entitled to rely upon any determination or designation of such a rate
(and any Benchmark Replacement Adjustment or Benchmark Conforming Changes, or
other modifier) by the Company or its Designee, or (ii) liability for any
failure or delay by the Company or its Designee in performing their respective
duties under this Subordinated Note or any other transaction documents as a
result of the unavailability of LIBOR, or any other Benchmark Replacement
described herein or the failure of a Benchmark Replacement to be adopted.

3.Non-Business Days. Whenever any payment to be made by the Company hereunder
will be stated to be due on a day that is not a business day, such payment will
be made on the next succeeding business day without change in any computation of
interest with respect to such payment or any succeeding payment. “Business day”
means any day other than a Saturday, Sunday or any other day on which banking
institutions in New York, New York are permitted or required by any applicable
law or executive order to close.

4.Transfer; Security Register. The Company or its agent (the “Registrar”) will
maintain a register of each holder of the Subordinated Notes and the exchange
and transfer thereof (the “Security Register”). The Subordinated Notes will
initially be issued in certificated form, but may be issued in global and
book-entry form as provided in Section 18 below. Except as otherwise provided
herein, this Subordinated Note may be transferred in whole or in part, and may
be exchanged for a like aggregate principal amount of Subordinated Notes of
other authorized denominations, at the principal office of the Company or
Registrar, and such other office(s) of the Company or the Registrar as may be
designated for such purpose, by the Holder in person, or by his attorney duly
authorized in writing, upon due endorsement or written instrument of transfer in
form satisfactory to the Company. Upon surrender or presentation of this
Subordinated Note for exchange or registration of transfer, the Company or the
Registrar will issue and deliver one of more Subordinated Notes, in authorized
denominations, with an aggregate principal amount equal to the aggregate
principal amount of this Subordinated Note and registered in such name or names
requested by the Holder. Such transferee will be solely responsible for
delivering to the Company or the Registrar a mailing address or other
information necessary for the Company or the Registrar to deliver notices and
payments to such transferee. The Company or the Registrar may also request
evidence of compliance with any restrictive legends appearing on this
Subordinated Note in connection with any such proposed transfer. The Company
will not be required to register the transfer of or exchange this Subordinated
Note within 15 calendar days of the Stated Maturity Date or with respect to any
portion of this Subordinated Note called for redemption. Prior to due
presentment of this Subordinated Note for registration of transfer, the Company
may treat the holder in whose name this Subordinated Note is registered in the
Security Register as the absolute owner of this Subordinated Note for receiving
payments of principal and interest on this Subordinated Note and for all other
purposes whatsoever, whether or not this Subordinated Note be overdue, and the
Company will not be affected by any notice to the contrary.

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5.Affirmative Covenants. During the time that any portion of the principal
balance of this Subordinated Note is unpaid and outstanding, the Company will
take or cause to be taken the actions set forth below.

(a)Notice of Certain Events. To the extent permitted by applicable law, rule or
regulation, the Company will provide written notice to the Holder of the
occurrence of any of the following events as soon as practicable, but in no
event later than 10 business days following the Company’s becoming aware of the
occurrence of such event:

(i)the total risk-based capital ratio of the Company (but only to the extent the
Company is required to measure and report such ratios on a consolidated basis
under applicable law) or any of the Company’s banking subsidiaries (each, a
“Bank”), as determined as of the end of a calendar quarter, becomes less than
10.0%;

(ii)the Company, the Bank, or any officer of the Company or the Bank becomes
subject to any formal, written regulatory enforcement action;

(iii)the ratio of non-performing assets to total assets of the Bank, as
calculated as of the end of a calendar quarter by the Bank in the ordinary
course of business and consistent with past practices, becomes greater than
5.0%;

(iv)the appointment, resignation, removal or termination of the chief executive
officer, president, chief financial officer or chief credit officer of the
Company or the Bank; or

(v)there occurs a change in ownership of 25% or more of the voting securities of
the Company, other than as a result of the issuance of Company common stock or a
change resulting from the transfer of such securities to any trust or entity
that is created solely for the benefit of such shareholder or any spouse or
lineal descendant of such shareholder, to any individual by bona fide gift or
otherwise solely for estate planning purposes.

(b)Compliance with Laws. The Company and each of its subsidiaries will comply
with the requirements of all laws, regulations, orders, and decrees applicable
to it or its properties, except for such noncompliance that would not reasonably
be expected to result in a material and adverse effect on the financial
condition, results of operations or business of the Company and its subsidiaries
taken as a whole.

(c)Taxes and Assessments. The Company and each of its subsidiaries will
punctually pay and discharge, when due, all taxes, assessments, and other
governmental charges or levies imposed upon it or upon its income or upon any of
its properties; provided, that no such taxes, assessments or other governmental
charges need be paid if they are being contested in good faith by the Company.

(d)Compliance Certificate. Not later than 45 days following the end of each
calendar quarter, the Company will provide the Holder with a certificate,
executed by the principal executive officer and principal financial officer of
the Company in their capacities as such, stating whether as of the end of such
immediately preceding calendar quarter, (i) the Company has complied in all
material respects with all of the covenants contained in this Subordinated Note;
(ii) an Event of Default has occurred; (iii) an event of default has occurred
under any other indebtedness of the Company; or (iv) an event or events have
occurred that in the reasonable judgment of the management of the Company would
have a material adverse effect on the ability of the Company to perform its
obligations under this Subordinated Note.

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(e)Business Continuation. The Company will use commercially reasonable efforts
to maintain and preserve intact the corporate existence of the Company and each
of its subsidiaries, and the rights, licenses, franchises of the Company and
each of its subsidiaries; provided, however, that the Company will not be
required to preserve the existence (corporate or other) of any of its
subsidiaries or any such right, license or franchise of the Company or any of
its subsidiaries if the Board of Directors determines that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
its subsidiaries taken as a whole and that the loss thereof will not materially
and adversely affect the ability of the Company to satisfy its obligations under
this Subordinated Note.

6.Negative Covenants.

(a)The Company will not declare or pay any dividend or make any distribution on
capital stock or other equity securities of any kind of the Company, except for
dividends payable solely in shares of common stock, if either the Company (but
only to the extent the Company is required to measure and report such ratios on
a consolidated basis under applicable law) or the Bank, both immediately prior
to the declaration of such dividend or distribution and after giving effect to
the payment of such dividend or distribution, would not maintain regulatory
capital ratios that are at “well capitalized” levels for regulatory capital
purposes.

(b)Other than in connection with a transaction that complies with Section 10
hereof, the Company will not take any action, omit to take any action or enter
into any other transaction that would have the effect of (i) the Company ceasing
to be a bank holding company or financial holding company under the Bank Holding
Company Act of 1956, as amended, (ii) the liquidation or dissolution of the
Company or the Bank, (iii) the Bank ceasing to be an “insured depository
institution” under Section 3(c)(2) of the Federal Deposit Insurance Act, as
amended, or (iv) the Company owning less than all of the issued and outstanding
shares of capital stock of the Bank.

7.Paying Agent and Registrar. Wilmington Trust, National Association will act as
the initial Paying Agent and Registrar through its offices presently located at
1100 North Market Street, Wilmington, DE 19890. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company or any of
its subsidiaries may act in any such capacity.

8.Subordination. The indebtedness of the Company evidenced by this Subordinated
Note, including the principal and interest, is subordinate and junior in right
of payment to its obligations to the holders of all Senior Indebtedness (as
defined below), and such subordination is for the benefit of and enforceable by
the holders of such Senior Indebtedness. If there will have occurred and be
continuing a default in any payment with respect to Senior Indebtedness or any
event of default with any Senior Indebtedness as a result of which the maturity
thereof is accelerated, unless and until such payment default or event of
default will have been cured or waived or will have ceased to exist, no payments
will be made by the Company with respect to the Subordinated Notes. In the event
of any insolvency, receivership, conservatorship, reorganization, readjustment
of debt, marshaling of assets and liabilities or similar proceedings or any
liquidation or winding up of or relating to the Company, whether voluntary or
involuntary, all Senior Indebtedness will be entitled to be paid in full before
any payment will be made on account of the principal of or interest on this
Subordinated Note. In the event of any such proceedings, after payment in full
of all sums owing on such prior obligations, the Holder, together with holders
of any obligations of the Company ranking on a parity with this Subordinated
Note, will be entitled to be paid from the remaining assets of the Company the
unpaid principal thereof and any interest thereon before any payment or other
distribution, whether in cash, property or otherwise, will be made on account of
any capital stock or any obligations of the Company ranking junior to this
Subordinated Note. Nothing herein will impair the

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obligation of the Company, which is absolute and unconditional, to pay the
principal of and interest on this Subordinated Note according to its terms.

“Senior Indebtedness” means the principal of, and premium, if any, and interest,
if any, on each of the following, whether now outstanding, or created, assumed
or incurred in the future: (i) Company’s obligations for money borrowed; (ii)
indebtedness of the Company evidenced by bonds, debentures, notes or similar
instruments; (iii) similar obligations of the Company arising from off-balance
sheet guarantees and direct credit substitutes; (iv) reimbursement obligations
of the Company with respect to letters of credit, bankers’ acceptances or
similar facilities; (v) obligations of the Company issued or assumed as the
deferred purchase price of property or services (but excluding trade accounts
payable or accrued liabilities arising in the ordinary course of business); (vi)
capital lease obligations of the Company; (vii) obligations of the Company
associated with derivative products including but not limited to securities
contracts, foreign currency exchange contracts, swap agreements (including
interest rate and foreign exchange rate swap agreements), cap agreements, floor
agreements, collar agreements, interest rate agreements, foreign exchange rate
agreements, options, commodity futures contracts, commodity option contracts and
similar financial instruments; (viii) a deferred obligation of, or any such
obligation, directly or indirectly guaranteed by, the Company which obligation
is incurred in connection with the acquisition of any business, properties or
assets not evidenced by a note or similar instrument given in connection
therewith; (ix) debt of others described in the preceding clauses that Company
has guaranteed or for which the Company is otherwise liable; and (x) the
Company’s obligations to general creditors; provided, however, that Senior
Indebtedness excludes (1) any of the foregoing if, in the instrument creating or
evidencing that indebtedness, obligation or liability, or pursuant to which the
same is outstanding, it is expressly provided that the indebtedness is junior in
right of payment to or ranks equally in right of payment with, other specific
types of indebtedness, obligations or liabilities of the Company that include
this Subordinated Note or other indebtedness, obligations or liabilities that
rank equally with or junior to this Subordinated Note, (2) any indebtedness,
obligation or liability that is subordinated to indebtedness, obligation or
liabilities of the Company to substantially the same extent as or to a greater
extent than the Subordinated Notes are subordinated, and (3) the Subordinated
Notes.
9.Events of Default; Acceleration.

(a)An “Event of Default” means the occurrence of one or more of the following
events:

(i)the Company fails to pay any principal of or installment of interest on this
Subordinated Note when due (or, in the case of interest, after a 15-day grace
period);

(ii)the Company fails to keep or perform any of its agreements, undertakings,
obligations, covenants or conditions under this Subordinated Note not expressly
referred to in another clause of this Section 9 and such failure continues for a
period of 30 days after the date on which notice specifying such failure is
given to the Company by any holder of Subordinated Notes;

(iii)the Company or the Bank becomes insolvent or unable to pay its debts as
they mature, makes an assignment for the benefit of creditors, or admits in
writing its inability to pay its debts as they mature; or

(iv)the Company or the Bank becomes subject to a receivership, insolvency,
liquidation, or similar proceeding.

(b)Remedies of Holders. Upon the occurrence of any Event of Default, the Holder
will have the right, if such Event of Default will then be continuing, in
addition to all the remedies conferred

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upon the Holder by the terms of this Subordinated Note, to do any or all of the
following, concurrently or successively, without notice to the Company:

(i)solely with respect to a default under Section 9(a)(iv), declare this
Subordinated Note to be, and it will thereupon become, immediately due and
payable, without presentment, demand, protest or notice of any kind, all of
which are expressly waived, notwithstanding anything contained herein or in this
Subordinated Note to the contrary; or

(ii)exercise all of its rights and remedies at law or in equity, excluding the
right, if any, to declare this Subordinated Note to be immediately due and
payable (such right to acceleration being governed solely by Section 9(b)(i).

(c)Distribution Limitations Upon Event of Default. Upon the occurrence of any
Event of Default and until such Event of Default is cured by the Company, the
Company will not (i) declare, pay, or make any dividends or distributions on, or
redeem, purchase, acquire, or make a liquidation payment with respect to, any of
the Company’s capital stock, other than (1) dividends or distributions in shares
of, or options, warrants or rights to subscribe for or purchase shares of, any
class of the Company’s common stock; (2) any declaration of a non-cash dividend
in connection with the implementation of a shareholders’ rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto; (3) as a result of a
reclassification of the Company’s capital stock or the exchange or conversion of
one class or series of the Company’s capital stock for another class or series
of the Company’s capital stock; (4) the purchase of fractional interests in
shares of the Company’s capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged;
or (5) purchases of any class of the Company’s common stock related to the
issuance of common stock or rights under any benefit plans for the Company’s
directors, officers or employees or any of the Company’s dividend reinvestment
plans, (ii) make any payment of principal or interest or premium, if any on or
repay, repurchase or redeem any debt securities of the Company that rank equal
with or junior to the Subordinated Notes, or (iii) make any payments under any
guarantee that ranks equal with or junior to the Subordinated Notes. The
limitations imposed by the provisions of this Section 9(c) will apply whether or
not notice of an Event of Default has been given.

(d)Reimbursement of Expenses. Upon the occurrence of any Event of Default, in
addition to all the remedies conferred upon Holder by the terms of this
Subordinated Note and subject to any applicable law, the Company will pay
Holder’s reasonable fees and expenses including attorneys’ fees and expenses, in
connection with the enforcement of this Subordinated Note.

(e)Other Remedies. Nothing in this Section 9 is intended to restrict Holder’s
rights under this Subordinated Note, other related documents, or at law or in
equity, and Holder may exercise such rights and remedies as and when they are
available to the extent permitted by Section 9(b).

10.Merger or Sale of Assets. The Company will not merge into another entity,
effect a Change in Bank Control (as defined below), or convey, transfer or lease
substantially all of its properties and assets to any person, unless (i) the
continuing entity into which the Company is merged or the person which acquires
by conveyance or transfer or which leases substantially all of the properties
and assets of the Company will be a corporation, association or other legal
entity organized and existing under the laws of the United States of America,
any State thereof or the District of Columbia and expressly assumes the due and
punctual payment of the principal of and any premium and interest on the
Subordinated Notes according to their terms, and the due and punctual
performance of all covenants and conditions hereof on the part of the Company to
be performed or observed; and (ii) immediately after giving effect to such
transaction, no Event of Default, and

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no event which, after notice or lapse of time or both, would become an Event of
Default, will have occurred and be continuing. “Change in Bank Control” means
the sale, transfer, lease or conveyance by the Company, or an issuance of equity
securities by the Bank other than to the Company, in either case resulting in
ownership by the Company of less than fifty percent of the outstanding voting
securities of the Bank.

11.Amendments and Waivers.

(a)Amendment of Subordinated Notes. Except as otherwise provided in Section 11
hereof, and subject to any necessary regulatory approval, the Subordinated Notes
may, with the consent of the Company and the Holders of more than 50% of the
aggregate outstanding principal amount of the Subordinated Notes then
outstanding, be amended or any provision, past default, or non‑compliance
thereof waived; provided, however, that, without the consent of each Holder of
an affected Subordinated Note, no such amendment or waiver may:

(i)reduce the principal amount of the Subordinated Note;

(ii)reduce the rate of or change the time for payment of interest on any
Subordinated Note;

(iii)extend the maturity of any Subordinated Note;

(iv)make any change in Sections 7 through 11 hereof; 

(v)make any change in Section 13 hereof that adversely affects the rights of any
holder of a Subordinated Note; or

(vi)disproportionately affect any of the Holders of the then outstanding
Subordinated Notes.

(b)Effectiveness of Amendments and Waivers. An amendment or waiver becomes
effective in accordance with its terms and thereafter binds every holder of the
Subordinated Notes, unless otherwise provided by Section 11(a) above. After an
amendment or waiver becomes effective, the Company will mail to the Holder a
copy of such amendment or waiver. The Company may require the Holder to
surrender this Subordinated Note so that an appropriate notation concerning the
amendment or waiver may be placed thereon or a new Subordinated Note, reflecting
the amendment or waiver, exchanged therefor. Even if such a notation is not made
or such a new Subordinated Note is not issued, such amendment or waiver and any
consent given thereto by a Holder of this Subordinated Note will be binding
according to its terms on any subsequent Holder of this Subordinated Note.

(c)Amendments Without Consent of Holders. Notwithstanding Section 11(a) hereof
but subject to the proviso contained in subsections (i) through (vi) therein,
the Company may amend or supplement this Subordinated Note without the consent
of the holders of the Subordinated Notes to provide for uncertificated
Subordinated Notes in addition to or in place of certificated Subordinated
Notes.

(d)Waivers. Neither any failure nor any delay on the part of the Holder in
exercising any right, power or privilege under this Subordinated Note will
operate as a waiver thereof, nor will a single or partial exercise thereof
preclude any other or further exercise of any other right, power or privilege.
The rights and remedies provided in this Subordinated Note are cumulative and
not exclusive of any right or remedy provided by law or equity.

--------------------------------------------------------------------------------

12.Order of Payments; Pari Passu. Any payments made hereunder will be applied
first against interest due hereunder; and then against principal due hereunder.
Holder acknowledges and agrees that the payment of all or any portion of the
outstanding principal amount of this Subordinated Note and all interest hereon
will be pari passu in right of payment and in all other respects to the other
Subordinated Notes and subordinated debt issued by the Company in the future
which by its terms are pari passu with the Subordinated Notes. In the event
Holder receives payments in excess of its pro rata share of the Company’s
payments to the holders of all of the Subordinated Notes, then Holder will hold
in trust all such excess payments for the benefit of the holders of the other
Subordinated Notes and will pay such amounts held in trust to such other holders
upon demand by such holders.

13.Optional Redemption.

(a)Redemption Prior to Fifth Anniversary. This Subordinated Note will not be
redeemable by the Company prior to the fifth anniversary of the Issue Date,
except upon a Tier 2 Capital Event, a Tax Event or an Investment Company Event,
each as defined below. Upon the occurrence of a Tier 2 Capital Event, a Tax
Event or an Investment Company Event, the Company may redeem this Subordinated
Note, in whole but not in part, at any time upon giving not less than 10 days’
notice to the Holder at an amount equal to 100% of the outstanding principal
amount plus accrued but unpaid interest to but excluding the date fixed for
redemption (the “Redemption Date”). “Tier 2 Capital Event” means the
determination of the Company, in the exercise of its reasonable judgment, to the
effect that there is a material risk that this Subordinated Note no longer
qualifies as tier 2 capital (as defined by the Federal Reserve or its then
equivalent) as a result of a change in interpretation or application of law or
regulation by any judicial, legislative or regulatory authority that becomes
effective after the Issue Date. “Tax Event” means the receipt by the Company of
an opinion of counsel to the Company that as a result of any amendment to, or
change (including any final and adopted (or enacted) prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, there exists a material risk that interest
payable by the Company on the Subordinated Notes is not, or within 120 days
after the receipt of such opinion will not be, deductible by the Company, in
whole or in part, for United States federal income tax purposes. “Investment
Company Event” means the receipt by the Company of an opinion of counsel to the
Company to the effect that there is a material risk that the Company is or,
within 120 days after the receipt of such opinion will be, required to register
as an investment company pursuant to the Investment Company Act of 1940, as
amended.

(b)Redemption on or After Fifth Anniversary. On or after the fifth anniversary
of the Issue Date, upon giving the notice required in Section 13(c), this
Subordinated Note will be redeemable at the option of and by the Company, in
whole or in part at any time or from time to time, upon any Interest Payment
Date, at an amount equal to 100% of the outstanding principal amount outstanding
plus accrued but unpaid interest to but excluding the Redemption Date.

(c)Notice of Redemption. Notice of redemption of this Subordinated Note will be
given by first class mail, postage prepaid, addressed to the Holder at its last
address appearing on the books of the Registrar. In the case of redemption under
Section 13(b), such notice will be mailed at least 30 days and not more than 60
days before the Redemption Date. Any notice mailed as provided in this
Subordinated Note will be conclusively presumed to have been duly given, whether
or not the Holder receives such notice, but failure duly to give such notice by
mail, or any defect in such notice or in the mailing thereof, to the Holder will
not affect the validity of the proceedings for the redemption of any other
Holders. Each notice of redemption given to the Holder will state the Redemption
Date, the principal amount of this Subordinated

--------------------------------------------------------------------------------

Note to be redeemed, the redemption price and the place or places where this
Subordinated Note is to be surrendered for payment of the redemption price.

(d)Partial Redemption. If less than the then outstanding principal amount of
this Subordinated Note is redeemed, (i) a new note will be issued representing
the unredeemed portion without charge to the Holder thereof and (ii) such
redemption will be effected on a pro rata basis as to the Holders, subject to
adjustments in the discretion of the Company (which will be provided to the
Paying Agent and Registrar in writing) to ensure the unredeemed portion of this
Subordinated Note remains in an authorized denomination hereunder. For purposes
of clarity, upon a partial redemption, a like percentage of the principal amount
of every Subordinated Note held by every Holder will be redeemed; provided
however that the Company may round the portion to be redeemed of this
Subordinated Note up or down so that the unredeemed amount remains an authorized
denomination hereunder, without any impact on the pro rata amount to be redeemed
from other Holders (which will be provided to the Paying Agent in writing).

(e)Effectiveness of Redemption. If notice of redemption has been duly given and
if on or before the redemption date all funds necessary for the redemption have
been deposited by the Company in trust for the pro rata benefit of the Holders
of the Subordinated Notes called for redemption, so as to be and continue to be
available solely therefor, then, notwithstanding that any Subordinated Notes so
called for redemption have not been surrendered for cancellation, on and after
the Redemption Date interest will cease to accrue on all Subordinated Notes so
called for redemption, all Subordinated Notes so called for redemption will no
longer be deemed outstanding and all rights with respect to such Subordinated
Notes will forthwith on such Redemption Date cease and terminate, except only
the right of the Holders thereof to receive the amount payable on such
redemption held in trust, without interest. Any funds unclaimed at the end of
two years from the Redemption Date will, to the extent permitted by law, be
released to the Company, after which time the Holders of the Subordinated Notes
so called for redemption will look only to the Company for payment of the
redemption price of such Subordinated Notes.

(f)No Redemption at Option of Holder. This Subordinated Note is not subject to
redemption at the option of the Holder.

(g)Regulatory Approvals. Notwithstanding anything in this Subordinated Note to
the contrary, any such redemption will be subject to the receipt of any and all
required federal and state regulatory approvals or non-objections.

(h)Purchase and Resale of the Subordinated Notes. Subject to any required
regulatory approvals and the provisions of this Subordinated Note, the Company
will have the right to purchase any of the Subordinated Notes at any time in the
open market, private transactions or otherwise. If the Company purchases any
Subordinated Notes, it may, in its discretion, hold, resell or cancel any of the
purchased Subordinated Notes.

14.Notices. All notices and other communications hereunder will be in writing
and will be delivered personally or by nationally recognized overnight courier
service or sent by U.S. mail or by facsimile transmission, at the respective
addresses or transmission numbers set forth below and will be deemed delivered
in the case of personal delivery, facsimile transmission, when received; in the
case of mail, upon the earlier of actual receipt or five business days after
deposit in the United States Postal Service, first class certified or registered
mail, postage prepaid, return receipt requested; and in the case of an overnight
courier service, one business day after delivery to such courier service with
instructions for overnight delivery. Each party may change its contact
information by written notice to the other party sent as provided in this
Section. All communications must be in writing and addressed as follows: (i) if
to the Company: Investar Holding

--------------------------------------------------------------------------------

Corporation, 10500 Coursey Boulevard, 3rd Floor, Baton Rouge, Louisiana 70816,
Attention: John J. D’Angelo; and (ii) if to a Holder: to the address indicated
for the Holder on the Security Register.

15.Conflicts; Governing Law; Interpretation. In the case of any conflict between
the provisions of this Subordinated Note and the Purchase Agreement, the
provisions of this Subordinated Note will control. This Subordinated Note will
be construed in accordance with, and be governed by, the laws of New York
without giving effect to any conflicts of law provisions of such laws. This
Subordinated Note is intended to meet the criteria for qualification of the
outstanding principal as tier 2 capital under the regulatory guidelines of the
Federal Reserve. If at any time the Company is subject to consolidated capital
requirements under applicable regulations of the Federal Reserve and after such
time all or any portion of this Subordinated Note ceases to be deemed to be
tier 2 capital, other than due to the limitation imposed on the capital
treatment of subordinated debt during the five years immediately preceding the
Stated Maturity Date, the Company will promptly notify the Holder, and
thereafter, subject to the Company’s right to redeem this Subordinated Note
under such circumstances pursuant to the terms of this Subordinated Note, if
requested by the Company, 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 this
Subordinated Note to qualify as tier 2 capital. All references in this
Subordinated Note to days are to calendar days, unless otherwise expressly
noted.

16.Successors and Assigns. This Subordinated Note will be binding upon the
Company and inure to the benefit of the Holder and its respective successors and
permitted assigns. Subject to any restrictions on transfer under federal or
state securities laws, the Holder may assign all, or any part of, or any
interest in, the Holder’s rights and benefits hereunder at any time without
notice to or consent of the Company, and the failure of Holder to comply with
the requirements of Section 4 will have no effect of the effectiveness of such
assignment. The Company may not assign this Subordinated Note or its obligations
hereunder except as provided in Section 10 hereto or with the prior written
consent of the Holder to the extent set forth in Section 11.

17.Notes Solely Corporate Obligations. No recourse under or upon any obligation,
covenant or agreement contained in this Subordinated Note, or for any claim
based thereon or otherwise in respect thereof, will be had against any past,
present or future shareholder, employee, officer, or director, as such, of the
Company or of any predecessor or successor, either directly or through the
Company or any predecessor or successor, under any rule of law, statute or
constitutional provision or by the enforcement of any assessment or by any legal
or equitable proceeding or otherwise, all such liability being expressly waived
and released by the acceptance of this Subordinated Note by the Holder and as
part of the consideration for the issuance of this Subordinated Note.

18.Global Subordinated Notes.

(a)Provided that applicable depository eligibility requirements are met, upon
the written election of any holder of Subordinated Notes that is a qualified
institutional buyer, as defined in Rule 144A under the Securities Act
(“Qualified Institutional Buyer”), the Company will use its commercially
reasonable efforts to provide that the Subordinated Notes owned by holders of
Subordinated Notes that are Qualified Institutional Buyers will be issued in the
form of one or more global Subordinated Notes (each a “Global Subordinated
Note”) registered in the name of The Depository Trust Company or another
organization registered as a clearing agency under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), and designated as depositary by the
Company or any successor thereto (the “Depositary”) or a nominee thereof and
delivered to such Depositary or a nominee thereof.

--------------------------------------------------------------------------------

(b)Notwithstanding any other provision herein, no Global Subordinated Note may
be exchanged in whole or in part for Subordinated Notes registered, and no
transfer of a Global Subordinated Note in whole or in part may be registered, in
the name of any person other than the Depositary for such Global Subordinated
Note or a nominee thereof unless (i) such Depositary advises the Company in
writing that such Depositary is no longer willing or able to properly discharge
its responsibilities as Depositary with respect to such Global Subordinated
Note, and no qualified successor is appointed by the Company within 90 days of
receipt by the Company of such notice, (ii) such Depositary ceases to be a
clearing agency registered under the Exchange Act and no successor is appointed
by the Company within 90 days after obtaining knowledge of such event, (iii) the
Company elects to terminate the book-entry system through the Depositary or (iv)
an Event of Default (as defined in Section 9) will have occurred and be
continuing. Upon the occurrence of any event specified in clause (i), (ii),
(iii) or (iv) of this Section 18(b), the Company or its agent will notify the
Depositary and instruct the Depositary to notify all owners of beneficial
interests in such Global Subordinated Note of the occurrence of such event and
of the availability of Subordinated Notes to such owners of beneficial interests
requesting the same.

(c)If any Global Subordinated Note is to be exchanged for other Subordinated
Notes or canceled in part, or if another Subordinated Note is to be exchanged in
whole or in part for a beneficial interest in any Global Subordinated Note, then
either (i) such Global Subordinated Note will be so surrendered for exchange or
cancellation as provided in this Section 18 or (ii) the principal amount thereof
will be reduced or increased by an amount equal to the portion thereof to be so
exchanged or canceled, or equal to the principal amount of such other
Subordinated Note to be so exchanged for a beneficial interest therein, as the
case may be, by means of an appropriate adjustment made on the records of the
Company or, if applicable, the Registrar, whereupon the Company or, if
applicable, the Registrar, in accordance with the applicable rules and
procedures of the Depositary (“Applicable Depositary Procedures”), will instruct
the Depositary or its authorized representative to make a corresponding
adjustment to its records. Upon any such surrender or adjustment of a Global
Subordinated Note by the Depositary, accompanied by registration instructions,
the Company will execute and deliver any Subordinated Notes issuable in exchange
for such Global Subordinated Note (or any portion thereof) in accordance with
the instructions of the Depositary.

(d)Every Subordinated Note executed and delivered upon registration of transfer
of, or in exchange for or in lieu of, a Global Subordinated Note or any portion
thereof will be executed and delivered in the form of, and will be, a Global
Subordinated Note, unless such Subordinated Note is registered in the name of a
person other than the Depositary for such Global Subordinated Note or a nominee
thereof.

(e)The Depositary or its nominee, as the registered owner of a Global
Subordinated Note, will be the holder of such Global Subordinated Note for all
purposes under this Subordinated Note, and owners of beneficial interests in a
Global Subordinated Note will hold such interests pursuant to Applicable
Depositary Procedures. Accordingly, any such owner’s beneficial interest in a
Global Subordinated Note will be shown only on, and the transfer of such
interest will be effected only through, records maintained by the Depositary or
its nominee or its Depositary participants. If applicable, the Registrar will be
entitled to deal with the Depositary for all purposes relating to a Global
Subordinated Note (including the payment of principal and interest thereon and
the giving of instructions or directions by owners of beneficial interests
therein and the giving of notices) as the sole holder of the Subordinated Note
and will have no obligations to the owners of beneficial interests therein. The
Registrar will have no liability in respect of any transfers affected by the
Depositary.

(f)The rights of owners of beneficial interests in a Global Subordinated Note
will be exercised only through the Depositary and will be limited to those
established by law and agreements between such owners and the Depositary and/or
its participants.

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(g)No holder of any beneficial interest in any Global Subordinated Note held on
its behalf by a Depositary will have any rights with respect to such Global
Subordinated Note, and such Depositary may be treated by the Company and any
agent of the Company as the owner of such Global Subordinated Note for all
purposes whatsoever. Neither the Company nor any agent of the Company will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a Global
Subordinated Note or maintaining, supervising or reviewing any records relating
to such beneficial ownership interests. Notwithstanding the foregoing, nothing
herein will prevent the Company or any agent of the Company from giving effect
to any written certification, proxy or other authorization furnished by a
Depositary or impair, as between a Depositary and such holders of beneficial
interests, the operation of customary practices governing the exercise of the
rights of the Depositary (or its nominee) as holder of any Subordinated Note.

19.Charges and Transfer Taxes. No service charge will be made for any
registration of transfer or exchange of this Subordinated Note, or any
redemption or repayment of this Subordinated Note, or any conversion or exchange
of this Subordinated Note for other types of securities or property, but the
Company may require payment of a sum sufficient to pay all taxes, assessments or
other governmental charges that may be imposed in connection with the transfer
or exchange of this Subordinated Note from the Holder requesting such transfer
or exchange.

20.Priority. The Subordinated Notes rank pari passu among themselves and pari
passu, in the event of any insolvency proceeding, dissolution, assignment for
the benefit of creditors, reorganization, restructuring of debt, marshaling of
assets and liabilities or similar proceeding or any liquidation or winding up of
the Company, with all other present or future unsecured subordinated debt
obligations of the Company, except any unsecured subordinated debt that, by its
express terms, is senior or subordinate in right of payment to the Subordinated
Notes.

21.No Sinking Fund; Convertibility. This Subordinated Note is not entitled to
the benefit of any sinking fund. This Subordinated Note is not convertible into
or exchangeable for any of the equity securities, other securities or assets of
the Company or any subsidiary of the Company.

22.Further Issues. The Company may, from time to time, without the consent of
the Holder, create and issue additional notes having the same terms and
conditions as the Subordinated Notes (except for the issue date, issue price and
initial Interest Payment Date) so that such additional notes will be
consolidated and form a single series with the Subordinated Notes and rank
equally and ratably with the Subordinated Notes. In addition, nothing herein
will act to prohibit, limit or impede Company from issuing additional debt of
Company having the same rank as the Subordinated Notes or which may be junior or
senior in rank to the Subordinated Notes.

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ASSIGNMENT FORM

To assign this Subordinated Note, fill in the form below: (I) or (we) assign and
transfer this Subordinated Note to:

 
(Print or type assignee’s name, address and zip code)
 
 
 
(Insert assignee’s social security or tax I.D. No.)

        
and irrevocably appoint _______________________ agent to transfer this
Subordinated Note on the books of the Company. The agent may substitute another
to act for him or her.

Date:
 
 
Your signature:
 
 
 
 
(Sign exactly as your name appears on the face of this Subordinated Note)
 
 
 
 
 
 
 
 
Tax Identification No:
 
 
 
 
 
 

Signature Guarantee:    
(Signatures must be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program), pursuant to Rule 17Ad-15 of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”)).

The undersigned certifies that it [is / is not] an Affiliate of the Company and
that, to its knowledge, the proposed transferee [is / is not] an Affiliate of
the Company.

In connection with any transfer or exchange of this Subordinated Note occurring
prior to the date that is one year after the later of the date of original
issuance of this Subordinated Note and the last date, if any, on which this
Subordinated Note was owned by the Company or any Affiliate of the Company, the
undersigned confirms that this Subordinated Note is being:

CHECK ONE BOX BELOW:

¨
(1)    acquired for the undersigned’s own account, without transfer;

¨
(2)    transferred to the Company;

¨
(3)    transferred in accordance and in compliance with Rule 144A under the
Securities Act of 1933, as amended (the “Securities Act”);

¨
(4)    transferred under an effective registration statement under the
Securities Act;

¨
(5)    transferred in accordance with and in compliance with Regulation S under
the Securities Act;

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¨
(6)    transferred to an institutional “accredited investor” (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) or an “accredited investor”
(as defined in Rule 501(a)(4) under the Securities Act), that has furnished a
signed letter containing certain representations and agreements; or

¨
(7)    transferred in accordance with another available exemption from the
registration requirements of the Securities Act.

Unless one of the boxes is checked, the Company will refuse to register this
Subordinated Note in the name of any person other than the registered holder
thereof; provided, however, that if box (5), (6) or (7) is checked, the Company
may require, prior to registering any such transfer of this Subordinated Note,
in its sole discretion, such legal opinions, certifications and other
information as the Company may reasonably request to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act such as the exemption
provided by Rule 144 under such Act.

 
 
 
Signature:
 
 
 
 
 
 
Signature Guarantee:
 
 
 
 
(Signatures must be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program), pursuant to Exchange Act
Rule 17Ad-l5).

TO BE COMPLETED BY PURCHASER IF BOX (1) OR (3) ABOVE IS CHECKED.

The undersigned represents and warrants that it is purchasing this Subordinated
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a “qualified
institutional buyer” within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned’s foregoing representations in order to claim the exemption from
registration provided by Rule 144A.

Date:
 
 
Signature:
 
 
 
 
 
 

    

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EXHIBIT B
OPINION OF COUNSEL
1.    Each of the Company and its Subsidiaries (i) has been organized or formed,
as the case may be, is validly existing and is in good standing under the laws
of its jurisdiction of organization, (ii) has all requisite power and authority
to carry on its business as currently conducted and to own, lease and operate
its properties and assets as described in the Company Financial Statements and
(iii) is duly qualified or licensed to do business and is in good standing as a
foreign corporation, partnership or other entity as the case may be, in each
jurisdiction in which such qualification or licensing is required, whether by
reason of the ownership or leasing of property or the conduct of business,
except where the failure to be so qualified or in good standing would not,
individually or in the aggregate, have a Material Adverse Effect.
2.    The Company is a registered bank holding company under the Bank Holding
Company Act of 1956, as amended.
3.    The Bank is an insured depository institution under Section 3(c)(2) of the
Federal Deposit Insurance Act, as amended.
4.    The Company has all necessary corporate power and authority to execute,
deliver and perform its obligations under the Transaction Documents to which it
is a party and to consummate the transactions contemplated by the Transaction
Documents.
5.    The Agreement has been duly authorized, executed and delivered by the
Company. The Agreement constitutes a legal valid and binding obligation of
Company, enforceable against Company in accordance with its terms, except that
the enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, receivership, moratorium, fraudulent conveyance, fraudulent
transfer or other similar Laws now or hereafter in effect relating to creditors’
rights generally and (ii) general principles of equity (whether applied by a
court of law or equity) and the discretion of the court before which any
proceeding therefor may be brought.
6.    The Subordinated Notes have been duly authorized by the Company and when
duly executed, authenticated, issued and delivered to and paid for by the
Purchasers in accordance with the terms of the Agreement, will constitute, valid
and legally binding obligations of the Company, enforceable against the Company
in accordance with their terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, receivership, moratorium,
fraudulent conveyance, fraudulent transfer or other similar Laws now or
hereafter in effect relating to creditors’ rights generally and (ii) general
principles of equity (whether applied by a court of law or equity) and the
discretion of the court before which any proceeding therefor may be brought.
7.    Assuming the accuracy of the representations and warranties of each of the
Purchasers and the Company set forth in the Agreement, the Subordinated Notes to
be issued and sold by the Company to the Purchasers in accordance with the
Agreement will be issued in a transaction exempt from the registration
requirements of the Securities Act, it being understood that counsel expresses
no opinion as to any subsequent transfer, sale or conveyance of the Subordinated
Notes.
The opinion letter of Company’s counsel will be subject to customary limitations
and carveouts, and such counsel may rely as to matters of fact upon such
certificates of the officers of Company and Bank or governmental officials as
such counsel deems appropriate.

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EXHIBIT C
REGISTRATION RIGHTS PROVISIONS
1.Definitions.  All capitalized terms used herein that are defined in Section 1
of the Agreement will have the same meanings herein this Exhibit C. Capitalized
terms used and not otherwise defined in Section 1 of the Agreement will have the
meanings given such terms in this Section 1 of Exhibit C:

“Effective Date” means the time and date that the Registration Statement filed
pursuant to Section 2 is first declared effective by the Commission or otherwise
becomes effective.
“Effectiveness Period” has the meaning set forth in Section 2.
“Electing Holders” means one or more Holders that hold no less than a majority
in aggregate principal amount of the Registrable Securities then held by the
Holders.
“Holder” or “Holders” means (i) the Purchasers and (ii) permitted assignees of
the Purchasers who are assigned rights under the Agreement, in each case to the
extent that they continue to hold Registrable Securities.
“Indemnified Party” has the meaning set forth in Section 5(c).
“Indemnifying Party” has the meaning set forth in Section 5(c).
“Losses” has the meaning set forth in Section 5(a).
“Plan of Distribution” means the plan of distribution in substantially the form
attached hereto as Annex A.
“Proceeding” means a pending action, claim, suit, or proceeding (including,
without limitation, an investigation or partial proceeding, such as a
deposition) or investigation known to the Company to be threatened.
“Prospectus” means the prospectus included in a Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by a
Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
“Registrable Securities” means, as of any date of determination, the
Subordinated Notes; provided, however, that any such Registrable Securities will
cease to be Registrable Securities (and the Company will not be required to
maintain the effectiveness of any Registration Statement hereunder with respect
thereto) to the extent that (a) such Registrable Securities have been disposed
of by the Holder in accordance with an effective Registration Statement, (b)
such Registrable Securities have been sold in accordance with Rule 144, or (c)
the Registrable Securities become eligible for resale without volume or
manner-of-sale restrictions pursuant to Rule 144 and without the requirement for
the Company to be in compliance with the current public information requirement
under Rule 144.

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“Registration Statement” means a registration statement in the form required to
register the resale of the Registrable Securities, and including the Prospectus,
amendments and supplements to each such registration statement or Prospectus,
including pre- and post-effective amendments, all exhibits thereto, and all
material incorporated by reference or deemed to be incorporated by reference in
such registration statement.
“Rule 144” means Rule 144 promulgated by the Commission under the Securities
Act.
2.Registration. The Company will use commercially reasonable efforts to prepare
and, within 60 days following the Closing, file with the Commission a
Registration Statement covering the resale of all Registrable Securities for an
offering to be made on a continuous basis pursuant to Rule 415 promulgated under
the Securities Act. The Registration Statement will contain (except if otherwise
requested by the Electing Holders or required pursuant to written comments
received from the Commission upon a review of such Registration Statement) the
Plan of Distribution. The Company will use its commercially reasonable efforts
to cause the Registration Statement to be declared effective or otherwise to
become effective under the Securities Act as soon as practicable after the
filing, and will use its commercially reasonable efforts to keep the
Registration Statement (or a replacement Registration Statement) continuously
effective under the Securities Act until the date that all Registrable
Securities covered by such Registration Statement (a) have been disposed of by
the Holder in accordance with an effective Registration Statement, (b) have been
sold in accordance with Rule 144, or (c) become eligible for resale without
volume or manner-of-sale restrictions pursuant to Rule 144 and without the
requirement for the Company to be in compliance with the current public
information requirement under Rule 144 (the “Effectiveness Period”).
Notwithstanding the foregoing, the Company’s obligations under this Section will
be suspended during any period in which Form S-3 is not available for the
registration of the resale of all Registrable Securities.

3.Registration Procedures. The procedures to be followed by the Company and each
selling Holder, and the respective rights and obligations of the Company and
such Holders, with respect to the preparation, filing and effectiveness of a
Registration Statement, and the distribution of Registrable Securities pursuant
thereto, are as follows:

(a)At least five Business Days prior to the filing of a Registration Statement
and not less than one Business Day prior to the filing of any related Prospectus
(other than any amendment or supplement made through the incorporation by
reference of ordinary course Exchange Act filings), the Company will furnish to
the Holders copies of all such documents proposed to be filed (other than those
incorporated or deemed to be incorporated by reference), which documents will be
subject to the reasonable review of such Holders.

(b)The Company will use commercially reasonable efforts to (i) prepare and file
with the Commission such amendments, including post-effective amendments, and
supplements to each Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep a Registration Statement continuously
effective as to the applicable Registrable Securities for the Effectiveness
Period; and (ii) cause the related Prospectus to be amended or supplemented by
any required Prospectus supplement, and as so supplemented or amended to be
filed pursuant to Rule 424 promulgated under the Securities Act.

(c)The Company will comply in all material respects with the provisions of the
Securities Act and the Exchange Act with respect to the Registration Statement
and the disposition of all Registrable Securities covered by the Registration
Statement.

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(d)During the Effectiveness Period, the Company will furnish to each Holder,
without charge, at least one conformed copy of each Registration Statement and
each amendment thereto and all exhibits to the extent requested by such Person
(including those incorporated by reference) promptly after the filing of such
documents with the Commission; provided, however, that the Company will not have
any obligation to provide any document pursuant to this clause that is available
on the EDGAR system.

(e)The Company will promptly deliver to each Holder, without charge, as many
copies of each Prospectus (other than any amendment or supplement made through
the incorporation by reference of ordinary course Exchange Act filings) as such
Holders may reasonably request during the Effectiveness Period. The Company
consents to the use of such Prospectus by each of the selling Holders in
connection with the offering and sale of the Registrable Securities covered by
such Prospectus in accordance with this Agreement. Each Holder agrees that it
will comply with the prospectus delivery requirements of the Securities Act as
applicable to it or an exemption therefrom in connection with sales of
Registrable Securities pursuant to any Registration Statement and notify the
Company following the sale of Registrable Securities to a third party as
promptly as reasonably practicable, and in any event within 10 days following
the sale of such Registrable Securities.

(f)The Company will use commercially reasonable efforts to register or qualify
or cooperate with the selling Holders in connection with the registration or
qualification (or exemption from such registration or qualification) of such
Registrable Securities for offer and sale under the applicable state securities
or blue sky laws of those jurisdictions within the United States as any Holder
reasonably requests in writing to keep each such registration or qualification
(or exemption therefrom) effective during the Effectiveness Period and use its
commercially reasonable efforts to do any and all other acts or things necessary
or advisable to enable the disposition in such jurisdictions of the Registrable
Securities covered by the Registration Statements; provided, that the Company
will not be required to (i) qualify generally to do business or as a dealer in
securities in any jurisdiction where it is not then so qualified or (ii) take
any action which would subject the Company to general service of process or any
material tax in any such jurisdiction where it is not then so subject.

(g)If requested by a Holder, the Company will cooperate with such Holder to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be delivered to a transferee pursuant to a
Registration Statement, which certificates will be free, to the extent permitted
by the Agreement, of all restrictive legends.

(h)Each Holder will furnish to the Company such information regarding the Holder
and the distribution proposed by the Holders as the Company may reasonably
request and as will be reasonably required in connection with any registration
referenced hereunder. Each Holder agrees to, as promptly as practicable (and in
any event prior to any sales made pursuant to a Prospectus), furnish to the
Company all information required to be disclosed in order to make the
information previously furnished to the Company by the Holder not misleading.
Notwithstanding anything to the contrary herein, the Company will be under no
obligation to name or include a Holder in any Registration Statement if such
Holder has not provided the information required by this Section 3(h) with
respect to such Holder as a selling securityholder in such Registration
Statement or any related Prospectus within a reasonable time prior to filing
such Registration Statement, and the Company will be under no further obligation
to update or amend such Registration Statement to name or include such Holder
upon the subsequent delivery of such information after the filing of a
Registration Statement.

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(i)The Company will promptly notify the Holders (i) of the issuance by the
Commission or any other Governmental Entity of any stop order suspending the
effectiveness of a Registration Statement covering any or all of the Registrable
Securities or the initiation of any Proceedings for that purpose, (ii) of the
receipt by the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction, or the initiation or threatening of any
Proceeding for such purpose, (iii) of the occurrence of any event or passage of
time that makes the financial statements included in a Registration Statement
ineligible for inclusion therein or any statement made in a Registration
Statement or Prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires any revisions to a Registration Statement, Prospectus or other
documents so that, in the case of a Registration Statement or the Prospectus, as
the case may be, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and (iv) of the occurrence or existence of any pending
corporate development with respect to the Company that the Company believes may
be material and that, in the determination of the Company, makes it not in the
best interest of the Company to allow continued availability of a Registration
Statement or Prospectus, provided, however, in no event will any such notice
contain any information which would constitute material, non-public information
regarding the Company or any of its Subsidiaries. Each Holder agrees to keep
confidential the receipt of any notice received under this Section 3(i) and the
contents thereof (other than a notice with respect to clause (i)), except as
required pursuant to applicable Law.

(j)The Company will use commercially reasonable efforts to obtain the withdrawal
of any order stopping or suspending the effectiveness of a Registration
Statement or any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction.

4.Registration Expenses.  All fees and expenses incident to the Company’s
performance of or compliance with its obligations under this Agreement
(excluding any underwriting discounts and selling commissions) will be borne by
the Company whether or not any Registrable Securities are sold pursuant to a
Registration Statement. The fees and expenses referred to in the foregoing
sentence will include, without limitation, (i) all registration and filing fees,
(ii) printing expenses, if the printing of prospectuses is reasonably requested
by the holders of a majority of the Registrable Securities included in the
Registration Statement, (iii) messenger, telephone and delivery expenses,
(iv) fees and disbursements of counsel for the Company, (v) Securities Act
liability insurance, if the Company so desires such insurance, and (vi) fees and
expenses of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated hereby. For the avoidance of
doubt, each Holder will pay all underwriting and placement discounts and
commissions, agency and placement fees, brokers’ commissions and transfer taxes,
if any, relating to the sale or disposition of such Holder’s Registrable
Securities, as well as any other legal expenses or other costs incurred by such
Holders in connection with the transactions contemplated hereby.

5.Indemnification.

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(a)Indemnification by the Company. To the extent permitted by Law, the Company
will indemnify and hold harmless each Holder and each underwriter, broker-dealer
or selling agent, if any, which facilitates the disposition of Registrable
Securities, the officers, directors, agents, partners, members, stockholders and
employees of each of them, each Person who controls any such Holder,
underwriter, broker-dealer or selling agent (within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act) and the officers,
directors, agents and employees of each such controlling Person, from and
against any and all losses, claims, damages, liabilities, costs (including,
without limitation, reasonable costs of preparation and reasonable attorneys’
fees) and expenses (collectively, “Losses”), as incurred, arising out of or
relating to any untrue or alleged untrue statement of a material fact contained
in any Registration Statement, any Prospectus or any form of prospectus or in
any amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein (in
the case of any Prospectus or form of prospectus or supplement thereto, in light
of the circumstances under which they were made) not misleading, except to the
extent, but only to the extent, that (i) such Losses arise out of or are based
upon any untrue statements, alleged untrue statements, omissions or alleged
omissions that are based solely upon information regarding such Holder,
underwriter, broker-dealer or selling agent furnished in writing to the Company
by such Person expressly for use therein, or to the extent that such information
relates to such Holder or such Holder’s proposed method of distribution of
Registrable Securities and was reviewed and expressly approved in writing by
such Holder expressly for use in a Registration Statement, such Prospectus or in
any amendment or supplement thereto (it being understood that the Holder has
approved Annex A hereto for this purpose)  or (ii)  in the case of an occurrence
of an event of the type specified in Section 3(i), such Losses arise out of or
are based upon the use by such Holder of an outdated, defective or otherwise
unavailable Prospectus after the Company has notified such Holder in writing
that the Prospectus is outdated, defective or otherwise unavailable for use by
such Holder. The Company will notify the Holders promptly of the institution,
threat or assertion of any Proceeding of which the Company is aware in
connection with the transactions contemplated by this Agreement.

(b)Indemnification by Holders. Each Holder will, severally and not jointly,
indemnify and hold harmless the Company, its directors, officers, agents and
employees, each Person who controls the Company (within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all Losses, as
incurred, arising solely out of or based solely upon (i) any untrue statement of
a material fact contained in any Registration Statement, any Prospectus, or any
other form of prospectus, or in any amendment or supplement thereto, or arising
solely out of or based solely upon any omission of a material fact required to
be stated therein or necessary to make the statements therein (in the case of
any Prospectus, or any other form of prospectus, or supplement thereto, in light
of the circumstances under which they were made not misleading to the extent,
but only to the extent, that such untrue statements or omissions are based
solely upon information regarding such Holder furnished in writing to the
Company by such Holder in the Questionnaire or otherwise expressly for use
therein, and (ii) any violation or alleged violation by such Holder of Section
3(e), Section 3(i) or Section 6(b) hereof. In no event will the liability of any
selling Holder hereunder be greater in amount than the dollar amount of the net
proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.
 

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(c)Conduct of Indemnification Proceedings. If any Proceeding will be brought or
asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party will promptly notify the Person from whom
indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying
Party will be permitted to assume the defense thereof, including the employment
of counsel reasonably satisfactory to the Indemnified Party (whose approval will
not be unreasonably withheld) and the payment of all fees and expenses incurred
in connection with defense thereof; provided, however, that the failure of any
Indemnified Party to give such notice will not relieve the Indemnifying Party of
its obligations or liabilities pursuant to this Agreement, except (and only) to
the extent that it will be finally determined by a court of competent
jurisdiction (which determination is not subject to appeal or further review)
that such failure will have proximately and materially adversely prejudiced the
Indemnifying Party.

An Indemnified Party will have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel will be at the expense of such Indemnified Party or Parties
unless: (1) the Indemnifying Party has agreed in writing to pay such fees and
expenses; (2) the Indemnifying Party will have failed promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding (whose approval will not be
unreasonably withheld); or (3) the named parties to any such Proceeding
(including any impleaded parties) include both such Indemnified Party and the
Indemnifying Party, and such Indemnified Party will have been advised by counsel
that a conflict of interest is likely to exist if the same counsel were to
represent such Indemnified Party and the Indemnifying Party (in which case, if
such Indemnified Party notifies the Indemnifying Party in writing that it elects
to employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party will not have the right to assume the defense thereof and
such counsel will be at the expense of the Indemnifying Party); provided that
the Indemnifying Party will not be liable for the fees and expenses of more than
one separate firm of attorneys at any time for all Indemnified Parties. The
Indemnifying Party will not be liable for any settlement of any such Proceeding
effected without its written consent, which consent will not be unreasonably
withheld. No Indemnifying Party will, without the prior written consent of the
Indemnified Party, effect any settlement of any pending Proceeding in respect of
which any Indemnified Party is a party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Proceeding.
All fees and expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or preparing to
defend such Proceeding in a manner not inconsistent with this Section) will be
paid to the Indemnified Party, as incurred, promptly upon receipt of written
notice thereof to the Indemnifying Party (regardless of whether it is ultimately
determined that an Indemnified Party is not entitled to indemnification
hereunder; provided that the Indemnifying Party may require such Indemnified
Party to undertake to reimburse all such fees and expenses to the extent it is
finally judicially determined that such Indemnified Party is not entitled to
indemnification hereunder).

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(d)Contribution. If a claim for indemnification under Section 5(a) or 5(b) is
unavailable to an Indemnified Party (by reason of public policy or otherwise),
then each Indemnifying Party, in lieu of indemnifying such Indemnified Party,
will contribute to the amount paid or payable by such Indemnified Party as a
result of such Losses, in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party and Indemnified Party in connection
with the actions, statements or omissions that resulted in such Losses as well
as any other relevant equitable considerations. The relative fault of such
Indemnifying Party and Indemnified Party will be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or relates to information supplied by,
such Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a result
of any Losses will be deemed to include, subject to the limitations set forth in
Section 5(c), any reasonable attorneys’ or other reasonable fees or expenses
incurred by such party in connection with any Proceeding to the extent such
party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section was available to such party in
accordance with its terms.

The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 5(d) were determined by pro rata allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 5(d), no Holder will
be required to contribute, in the aggregate, any amount in excess of the amount
by which the proceeds actually received by such Holder from the sale of the
Registrable Securities subject to the Proceeding exceeds the amount of any
damages that such Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) will be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
The indemnity and contribution agreements contained in this Section are in
addition to any liability that the Indemnifying Parties may otherwise have to
the Indemnified Parties.

6.Miscellaneous.

(a)Remedies. In the event of a breach by the Company or by a Holder, of any of
its obligations under this Agreement, each Holder or the Company, as the case
may be, in addition to being entitled to exercise all rights granted by law and
hereunder, including recovery of damages, will be entitled to specific
performance of its rights hereunder.  The Company and each Holder agree that
monetary damages would not provide adequate compensation for any losses incurred
by reason of a breach by it of any of the provisions hereunder and further agree
that, in the event of any action for specific performance in respect of such
breach, it will waive the defense that a remedy at law would be adequate.

(b)Discontinued Disposition.  By its acquisition of Registrable Securities, each
Holder agrees that, upon receipt of a notice from the Company of the occurrence
of any event of the kind described in Section 3(j) or 3(i), such Holder will
forthwith discontinue disposition of such Registrable Securities under a
Registration Statement until it is advised in writing by the Company that the
use of the applicable Prospectus (as it may have been supplemented or amended)
may be resumed.  The Company will use commercially reasonable efforts to ensure
that the use of the Prospectus may be resumed as promptly as is practicable.
 The Company may provide appropriate stop orders to enforce the provisions of
this Section 6(b).

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(c)Amendments and Waivers. No provision hereof may be waived or amended except
in a written instrument signed by the Company and the Electing Holders. No
waiver of any default with respect to any provision, condition or requirement of
this Agreement will be deemed to be a continuing waiver in the future or a
waiver of any subsequent default or a waiver of any other provision, condition
or requirement hereof, nor will any delay or omission of either party to
exercise any right hereunder in any manner impair the exercise of any such
right.

(d)Interpretation. When a reference is made in this Exhibit to a Section, such
reference is to a Section of this Exhibit unless otherwise indicated. Any
statute, rule or regulation defined or referred to in this Exhibit means such
statute, rule or regulation as of the date of this Agreement as the same may be
amended from time to time. The words “hereof,” “herein” and “hereunder” and
words of similar import when used in this Exhibit refer to this Exhibit as a
whole and not to any particular provision of the Exhibit. This Exhibit forms
part of, and is incorporated into, the Agreement to which this Exhibit relates.
Except to the extent of any Accordingly, this Exhibit should be read together
with the Agreement, except to the extent of any irreconcilable conflict between
the Agreement and this Exhibit, in which case, the terms of this Exhibit will
prevail.

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ANNEX A
PLAN OF DISTRIBUTION
We are registering the subordinated notes previously issued to permit the resale
of these subordinated notes by the holders from time to time after the date of
this prospectus. We will not receive any of the proceeds from the sale by the
selling shareholders of the subordinated notes. We will bear all fees and
expenses incident to our obligation to register the subordinated notes, except
that, if the subordinated notes are sold through underwriters or broker-dealers,
the selling shareholders will be responsible for underwriting discounts or
commissions or agent’s commissions.
The selling shareholders may sell all or a portion of the subordinated notes
beneficially owned by them and offered hereby from time to time directly or
through one or more underwriters, broker-dealers or agents. The subordinated
notes may be sold in one or more transactions at fixed prices, at prevailing
market prices at the time of the sale, at varying prices determined at the time
of sale, or at negotiated prices. These sales may be effected in transactions,
which may involve crosses or block transactions,
•
in the over-the-counter market;

•
in transactions otherwise than in the over-the-counter market;

•
through the writing of options, whether such options are listed on an options
exchange or otherwise;

•
ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;

•
block trades in which the broker-dealer will attempt to sell the shares as agent
but may position and resell a portion of the block as principal to facilitate
the transaction;

•
purchases by a broker-dealer as principal and resale by the broker-dealer for
its account;

•
privately negotiated transactions;

•
short sales;

•
sales under Rule 144 of the Securities Act;

•
broker-dealers may agree with the selling shareholders to sell a specified
principal amount of such subordinated notes at a stipulated price;

•
a combination of any such methods of sale; and

•
any other method permitted under applicable law.

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If the selling shareholders effect such transactions by selling subordinated
notes to or through underwriters, broker-dealers or agents, such underwriters,
broker-dealers or agents may receive commissions in the form of discounts,
concessions or commissions from the selling shareholders or commissions from
purchasers of the subordinated notes for whom they may act as agent or to whom
they may sell as principal (which discounts, concessions or commissions as to
particular underwriters, broker-dealers or agents may be in excess of those
customary in the types of transactions involved). In connection with sales of
the subordinated notes or otherwise, the selling shareholders may enter into
hedging transactions with broker-dealers, which may in turn engage in short
sales of the subordinated notes in the course of hedging in positions they
assume. The selling shareholders may also sell subordinated notes short and
deliver our subordinated notes covered by this prospectus to close out short
positions and to return borrowed shares in connection with such short sales. The
selling shareholders may also loan or pledge our subordinated notes to
broker-dealers that in turn may sell such subordinated notes.
The selling shareholders may pledge or grant a security interest in some or all
of the subordinated notes owned by them and, if they default in the performance
of their secured obligations, the pledgees or secured parties may offer and sell
the subordinated notes from time to time pursuant to this prospectus or other
applicable provisions of the Securities Act, amending, if necessary, the list of
selling shareholders to include the pledgee, transferee or other successors in
interest as selling shareholders under this prospectus. The selling shareholders
also may transfer and donate the subordinated notes in other circumstances in
which case the transferees, donees, pledgees or other successors in interest
will be the selling beneficial owners for purposes of this prospectus.
The selling shareholders and any broker-dealer participating in the distribution
of the subordinated notes may be deemed to be “underwriters” within the meaning
of the Securities Act, and any commission paid, or any discounts or concessions
allowed to, any such broker-dealer may be deemed to be underwriting commissions
or discounts under the Securities Act. At the time a particular offering of the
subordinated notes is made, a prospectus supplement, if required, will be
distributed which will set forth the aggregate principal amount of our
subordinated notes being offered and the terms of the offering, including the
name or names of any broker-dealers or agents, any discounts, commissions and
other terms constituting compensation from the selling shareholders and any
discounts, commissions or concessions allowed or reallowed or paid to
broker-dealers.
Under the securities laws of some states, the subordinated notes may be sold in
such states only through registered or licensed brokers or dealers. In addition,
in some states the subordinated notes may not be sold unless such shares have
been registered or qualified for sale in such state or an exemption from
registration or qualification is available and is complied with.
There can be no assurance that any selling shareholder will sell any or all of
the subordinated notes registered pursuant to the registration statement, of
which this prospectus forms a part.
The selling shareholders and any other person participating in such distribution
will be subject to applicable provisions of the Exchange Act, and the rules and
regulations thereunder, including, without limitation, Regulation M of the
Exchange Act, which may limit the timing of purchases and sales of any of our
subordinated notes by the selling shareholders and any other participating
person. Regulation M may also restrict the ability of any person engaged in the
distribution of the subordinated notes to engage in market-making activities
with respect to our subordinated notes. All of the foregoing may affect the
marketability of our subordinated notes and the ability of any person or entity
to engage in market-making activities with respect to the subordinated notes.

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We will pay all expenses of the registration of our subordinated notes under the
registration statement of which this prospectus forms a part, including, without
limitation, SEC filing fees and expenses of compliance with state securities or
“blue sky” laws; provided, however, that the selling shareholders will pay all
underwriting discounts and selling commissions, if any. We will indemnify the
selling shareholders against liabilities, including some liabilities under the
Securities Act, or the selling shareholders will be entitled to contribution. We
may be indemnified by the selling shareholders against civil liabilities,
including liabilities under the Securities Act, that may arise from any written
information furnished to us by the selling shareholders specifically for use in
this prospectus or we may be entitled to contribution.
Once sold under the registration statement of which this prospectus forms a
part, the subordinated notes will be freely tradable in the hands of persons
other than our affiliates.