EXHIBIT 10.6

AMENDED AND RESTATED REVOLVING CREDIT/TERM LOAN AGREEMENT

THIS AMENDED AND RESTATED REVOLVING CREDIT/TERM LOAN AGREEMENT is dated as of
July 31, 2000 between COMMUNITY BANKSHARES, INC., a Georgia corporation, whose
principal place of business is at 400 North Main Street, Cornelia, Georgia 
30531 (the "Borrower") and SUNTRUST BANK, f/k/a SUNTRUST BANK, ATLANTA, a
Georgia banking corporation whose principal place of business is at 25 Park
Place, Atlanta, Georgia  30303 (the "Lender"). This Amended and Restated
Revolving Credit/Term Loan Agreement renews the Revolving Credit (the "Maturing
Revolving Credit") under and supersedes the Amended and Restated Revolving
Credit /Term Loan Agreement between the parties dated July 31, 1999.  The
parties hereto hereby agree as follows:

    ARTICLE I

  DEFINITIONS AND ACCOUNTING TERMS

Section 1.01.  Defined Terms. As used in this Agreement, the following terms
have the following meanings (terms defined in the singular to have same meaning
when used in the plural and vice versa):

"Additional Term Loan" has the meaning assigned to such term in Section 2.06.

"Additional Term Maturity Date" means July 31, 2004.

"Additional Term Note" has the meaning assigned to such term in Section 2.07.

"Affiliate" means any Person (1) which directly or indirectly controls, or is
controlled by, or is under common control with the Borrower or a Subsidiary; (2)
which directly or indirectly beneficially owns or holds five percent (5.0%) or
more of any class of voting stock of the Borrower or any Subsidiary; or (3) five
percent (5.0%) or more of the voting stock of which is directly or indirectly
beneficially owned or held by the Borrower or a Subsidiary.  The term "control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person whether through the
ownership of voting securities, by contract, or otherwise.

"Agreement" means this Amended and Restated Revolving Credit/Term Loan
Agreement, as amended, supplemented, or modified from time to time.

 

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"Bank" means each Subsidiary of Borrower that is listed on Exhibit A, attached
hereto and incorporated herein, and any Subsidiary acquired by Borrower from
time to time after the date hereof, which is a banking association or banking
corporation organized under either the laws of the United States or of a state
in the United States.

"Business Day" means any day other than a Saturday, Sunday, or other day on
which commercial banks in Georgia are authorized or required to close under the
laws of the State of Georgia.

"Call Reports" means, with respect to any Bank, such Bank's Consolidated Reports
of Condition and Income filed with such Bank's applicable federal Regulatory
Authority.

"Capital Lease" means all leases which have been or should be capitalized on the
books of the lessee in accordance with generally accepted accounting principles.

"Code" means the Internal Revenue Code of 1986, as amended from time to time,
and the regulations and published interpretations thereof.

"Collateral" means all property which is subject to the Lien granted by any Loan
Document, including, without limitation, the personal property identified and
described on Exhibit B attached hereto and incorporated herein.

"Commonly Controlled Entity" means an entity, whether or not incorporated, which
is under common control with the Borrower within the meaning of Section 414(b)
or 414(c) of the Code.

"Debt" means without duplication (1) indebtedness or liability of Borrower or
any Subsidiaries for borrowed money; (2) obligations of Borrower or any
Subsidiaries evidenced by bonds, debentures, notes, or other similar
instruments; (3) obligations of Borrower or any Subsidiaries for the deferred
purchase price of property or services (including trade obligations); (4)
obligations of Borrower or any Subsidiaries as lessee under Capital Leases; (5)
liabilities of Borrower or any Subsidiaries in respect of unfunded vested
benefits under Plans covered by ERISA; (6) all guarantees, endorsements (other
than for collection or deposit in the ordinary course of business), interest
rate swaps, and other contingent obligations of Borrower or any Subsidiaries to
purchase, to provide funds for

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payment, to supply funds to invest in any Person or entity, or otherwise to
assure a creditor against loss (except loans or letters of credit made or issued
in the ordinary course of business); and (7) obligations of Borrower or any
Subsidiaries, other than obligations as a lender, secured by any Liens, whether
or not the obligations have been assumed.  The term "Debt" does not include any
deposit liabilities of any Bank.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations and published interpretations thereof.

"Event of Default" means any of the events specified in Section 8.01, provided
that any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.

"Existing Term Loan" means that portion of the credit established pursuant to
the 1996 Agreement which remains outstanding pursuant thereto and under the
Existing Term Note.

"Existing Term Note" has the meaning assigned to such term in Section 2.05.

"GAAP" means generally accepted accounting principles in the United States.

"Governmental Authority" means any nation or government, any state or political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory, or administrative functions of or pertaining to government.

"Lien" means the charge, encumbrance, security interest, or right of the Lender
in property created by any Loan Document or any other mortgage, deed of trust,
pledge, security interest, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), or preference, priority, or other
security agreement or preferential arrangement, charge, or encumbrance of any
kind or nature whatsoever (including, without limitation, any conditional sale
or other title retention agreement, any financing lease having substantially the
same economic effect as of the foregoing, or the filing of any financing
statement under the Uniform Commercial Code or comparable law of any
jurisdiction to evidence any of the foregoing).

"Loan" means collectively, the Revolving Credit, the Existing Term Loan and the
Additional Term Loan, as such terms

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are defined, respectively, in Sections 2.01, 2.03 and 2.06 of this Agreement.

"Loan Documents" means this Agreement, the Revolving Credit Note, the Existing
Term Note, the Additional Term Note, the Security Agreement, or any deed to
secure debt, mortgage, deed of trust, pledge agreement, security agreement, or
other agreement evidencing or securing the Loan (two or more of the foregoing
being also referred to collectively herein as the "Loan Documents").

"Multiemployer Plan" means a Plan described in Section 4001(a)(3) of ERISA.

"1996 Agreement" means the Revolving Credit/Term Loan Agreement by and between
Borrower and Lender dated January 10, 1996, as amended, supplemented, or
modified from time to time.

"PBGC" means the Pension Benefit Guaranty Corporation or any entity succeeding
to any or all of its functions under ERISA.

"Person" means an individual, partnership, corporation, business trust, joint
stock company, trust, unincorporated association, joint venture, governmental
authority, or other entity of whatever nature.

"Plan" means any pension plan which is covered by Title IV of ERISA and in
respect of which the Borrower or a Commonly Controlled Entity is an "employer"
as defined in Section 3(5) of ERISA.

"Prime Rate" means the rate of interest announced by the Lender from time to
time as its prime commercial lending rate, which rate is not necessarily the
lowest rate of interest charged by the Lender to its borrowers.

"Principal Office" means the Lender's office at 25 Park Place, Atlanta, Georgia 
30303.

"Prohibited Transaction" means any transaction set forth in Section 406 of ERISA
or Section 4975 of the Code.

"Real Estate Owned" has the meaning assigned to such term in Section 4.15.

"Regulatory Authority" or "Regulatory Authorities" means the Federal Reserve
Board and, as applicable, the

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Department of Banking of a state of the United States, the Federal Deposit
Insurance Corporation, the Office of the Comptroller of the Currency and any
other agency with regulatory control over Borrower, any Bank or any other
Subsidiary.

"Reportable Event" means any of the events set forth in Section 4043 of ERISA.

"Revolving Credit" has the meaning assigned to such term in Section 2.01.

"Revolving Credit Note" shall have the meaning assigned to such term in Section
2.01.01

"Revolving Maturity Date" means July 31,2001.

"Security Agreement" means the Amended and Restated Stock Pledge and Security
Agreement executed by Borrower in favor of Lender dated July 21, 1997.

"Subsidiary" means, as to the Borrower, a corporation of which shares of stock
having ordinary voting power (other than stock having such power only by reason
of the happening of a contingency) to elect a majority of the board of directors
or other managers of such corporation are, at the time, owned, or the management
of which corporation is otherwise controlled, directly or indirectly, through
one or more intermediaries, or both, by the  Borrower. The term "Subsidiary"
shall specifically include the Banks.

"Tier I Capital" means those components of the equity capital of the Borrower or
of any Bank which, in the aggregate, constitute the core or primary capital of
the Borrower or Bank, as those components are determined and defined from time
to time by the Federal Regulatory Authority having primary jurisdiction over the
Borrower or any Bank.

"Tier II Capital" means those components of the equity capital of the Borrower
or of any Bank which, in the aggregate, constitute the supplementary capital of
the Borrower or Bank, as those components are determined and defined from time
to time by the Federal Regulatory Authority having primary jurisdiction over the
Borrower or any Bank.

"Total Capital" means the total of the amounts of Tier I Capital and Tier II
Capital that qualify, under the applicable regulations of the Federal Regulatory
Authority having primary jurisdiction over the Borrower or any Bank, for
inclusion in the

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computation of leverage capital requirements and risk-weighted capital
requirements.

"Total Non-Performing Assets" means the sum of (i) all loans that are at least
90 days past due and (ii) all non-accrual loans.

Section 1.02.  Accounting Terms. All accounting terms not specifically defined
herein shall be construed in accordance with generally accepted accounting
principles consistent with those applied in the preparation of the financial
statements referred to in Section 4.04, and all financial data submitted
pursuant to this Agreement shall be prepared in accordance with such principles.

  ARTICLE II

   AMOUNT AND TERMS OF THE LOAN

Section 2.01.  Revolving Credit.     Subject to and upon the terms and
conditions set forth in this Agreement, the Lender hereby establishes until the
Revolving Maturity Date a revolving credit facility in favor of the Borrower not
to exceed THREE MILLION AND NO/100 DOLLARS ($3,000,000.00) in aggregate
principal at any one time outstanding (the "Revolving Credit"). Within the
limits of the Revolving Credit, the Borrower may borrow, repay and reborrow
under the Revolving Credit pursuant to the terms of this Agreement; provided,
however, the Borrower may neither borrow nor reborrow should there exist an
Event of Default.

Section 2.01.01. Revolving Credit Note. The Borrower's obligation to pay
interest and repay principal under the Revolving Credit shall be evidenced by
its Promissory Note  (the "Revolving Credit Note") a copy of which is attached
hereto and incorporated herein as Exhibit D.

Section 2.02. Interest on the Revolving Credit. Interest shall accrue on all
advances under the Revolving Credit and shall be computed at an annual rate of
interest equal to the Prime Rate minus one percent (1.0%).  Accrued interest on
the Revolving Credit shall be paid on the last day of each consecutive three
month period, commencing October 31, 2000 and on the Revolving Maturity
Date.    

Section 2.03.  Existing Term Loan. The Existing Term Loan shall remain
outstanding and subject to the terms of th

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 Existing Term Note and the terms of this Agreement.  As of the date of this
Agreement the outstanding principal amount of the Existing Term Loan is
$77,049.96.

Section 2.04.  Interest on the Existing Term Loan. The Borrower shall pay
interest to the Lender on the outstanding and unpaid principal amount of the
Existing Term Loan made at a rate per annum equal to the Prime Rate minus one
percent (1%).

Section 2.05. Existing Term Note. The Borrower's obligation to repay the
Existing Term Loan shall be evidenced by its Revolving Credit/ Term Note dated
January 10, 1996 (the "Term Note")a copy of which is attached hereto and
incorporated herein as Exhibit D-1.

Section 2.06.     Additional Term Loan.  Subject to and upon the terms and
conditions set forth in this Agreement, the Lender hereby establishes until the
Additional Term Loan Maturity Date a term loan facility in favor of the Borrower
in the original principal amount of Nine Hundred Thousand and no/100 Dollars
($900,000.00)(the "Additional Term Loan").  The principal amount of the
Additional Term Loan represents the outstanding principal balance of the
Maturing Revolving Credit as of the date of this Agreement.

Section 2.07.     Additional Term Note.  The Borrower's obligation to pay
interest and repay principal under the Additional Term Loan shall be evidenced
by the Term Note (the "Additional Term Note") a copy of which is attached hereto
and incorporated herein as Exhibit D-2.

Section 2.08.     Principal and Interest on Additional Term Loan.  The principal
amount of the Additional Term Loan shall be repaid by the Borrower in sixteen
(16) consecutive equal installments, each in an amount equal to Fifty Six
Thousand Twenty Five and no/100 Dollars ($56,025.00), which shall be due and
payable on a quarterly basis.  The first such installment of principal shall be
due and payable on October 31, 2000 and on the last day of each consecutive
three month period thereafter through and including the Additional Term Loan
Maturity Date.  The Borrower shall pay interest on the outstanding and unpaid
principal balance of the Additional Term Loan with each quarterly principal
payment.  Interest shall be computed at an annual rate of interest equal to the
Prime Rate minus one percent (1.0%).

Section 2.09.  Changes in Interest Rate. With respect to the Revolving Credit,
Existing Term Loan and Additional Term

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Loan: (i) any change in the interest rate resulting from a change in the Prime
Rate shall become effective as of the opening of business on the day on which
such change in the Prime Rate shall become effective; (ii) Interest shall be
calculated on the basis of a year of three hundred sixty (360) days for the
actual number of days elapsed; and (iii) Any principal amount not paid when due
(at maturity, by acceleration, or otherwise) shall bear interest thereafter
until paid in full, payable on demand, at a rate which shall be two percent
(2.0%) above the rate which would otherwise be applicable.

Section 2.10.  Method of Payment. The Borrower shall make each payment under
this Agreement or the Loan, on the date when due in lawful money of the United
States to the Lender at its Principal Office in immediately available funds. 
The Borrower hereby authorizes the Lender, if and to the extent payment is not
made when due under this Agreement or the Loan, to charge from time to time
against any account of the Borrower with the Lender any amount so due.  Whenever
any payment to be made under this Agreement or the Loan, shall be stated to be
due on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest.

Section 2.11.  Use of Proceeds. Any and all proceeds of the Loan shall be used
by the Borrower for general corporate purposes.  The Borrower will not, directly
or indirectly, use any part of such proceeds for the purpose of purchasing or
carrying any margin stock within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System or to extend credit to any Person for
the purpose of purchasing or carrying any such margin stock, or for any purpose
which violates, or is inconsistent with, Regulation X of such Board of
Governors.

ARTICLE III

ADVANCES

Section 3.01.  Advances. The Borrower shall give the Lender at least one (1)
Business Day's telephone notice of a requested disbursement under the Revolving
Credit, specifying the date the disbursement is requested and the amount
thereof.  The Lender may rely upon such telephone request for disbursements
received from the individual(s) identifying themselves as and purporting to be
Mr. Harry Stephens, Chief

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Financial Officer of the Borrower. The telephone request for disbursement should
be promptly confirmed in writing by Borrower by mailing or transmitting by
facsimile transmission a confirmation to the Lender at the address designated
hereinafter, as may be amended. Upon fulfillment of the applicable conditions
set forth below, and provided that (i) the request for disbursement does not
cause the Borrower to exceed the aggregate principal amount of the Revolving
Credit and (ii) no Event of Default exists, the Lender will make such
disbursements available to the Borrower in immediately available funds by
crediting the amount thereof to the Borrower's account, or other designated
account, with the Lender.

Section 3.02.     Conditions Precedent to Initial Advance. The obligation of the
Lender to make the initial advance under the Revolving Credit is subject to the
condition precedent that the Lender shall have received on or before the day of
such advance each of the following, in form and substance satisfactory to the
Lender and its counsel:

(1)     Revolving Credit Note.  The Revolving Credit Note duly executed by the
Borrower;

(2)     Additional Term Note.  The Additional Term Note duly executed by the
Borrower.

(3)     Security Agreement. The Security Agreement shall remain in full force
and effect.

(4)     Evidence of All Corporate Action by the Borrower.  Certified (as of the
date of this Agreement) copies of all corporate action taken by the Borrower,
including resolutions of its Board of Directors, authorizing the execution,
delivery, and performance of the Loan Documents to which it is a party and each
other document to be delivered pursuant to this Agreement;

(5)     Incumbency and Signature Certificate of the Borrower.  A certificate
(dated as of the date of this Agreement) of the Secretary of Borrower certifying
the names and true signatures of officers of the Borrower authorized to sign the
Loan Documents to which it is a party and each of the other documents to be
delivered by the Borrower under this Agreement;

(6)     Opinion of Counsel for the Borrower. [Intentionally Omitted]

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(7)     Officer's Certificate.  A certificate signed by a duly authorized
officer of Borrower dated the date of this Agreement, in substantially the form
of Exhibit F;

(8)     Additional Documentation.  Such other approvals, opinions, or documents
as the Lender may reasonably request;

(9)     Request for Advance.  A request for advance pursuant to Section 3.01
hereof;

(10)     Regulatory Approval.  Copies of any and all necessary Governmental
Authority or Regulatory Authority approvals;

Section 3.03.  Conditions Precedent to Subsequent Advances. The obligation of
the Lender to make subsequent advances under the Revolving Credit is subject to
the conditions precedent that the Lender shall have received, in form and
substance satisfactory to it, each of the following documents, and that each of
the conditions described below is fulfilled to the satisfaction of the Lender: 
(i) if applicable, a request for advance pursuant to Section 3.01 hereof; and
(ii) the representations and warranties contained in Article IV hereof and each
of the other Loan Documents shall be correct in all material respects on and as
of the date of the request for the advance and the date of the advance (if
applicable),  with the same effect as though made on and as of those dates,
except to the extent that such representations and warranties relate solely to
an earlier date, and on each of such dates, no event, act, or condition shall
have occurred or be continuing, or would result from the advance requested 
which constitutes an Event of Default or would constitute an Event of Default
but for the requirement that notice be given or time elapse, or both.  The
submission by the Borrower of an oral or written request for advance shall
constitute a representation and warranty as to the correctness of the above
facts, and if requested by the Lender with respect to the advance requested, the
Borrower shall furnish to the Lender a written certificate of an officer of the
Borrower, satisfactory in form and substance to the Lender, as to the
correctness of the above facts as a condition precedent to such advance.

 

 

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES

In order to induce the Lender to enter into the Agreement and to  make advances
under the Revolving Credit, the Borrower represents and warrants to the Lender
that:

Section 4.01.  Incorporation, Good Standing, and Due Qualification. The Borrower
and each of its non-bank Subsidiaries is a corporation duly incorporated,
validly existing, and in good standing under the laws of the jurisdiction of its
incorporation.  Each of the Banks set forth on Exhibit A is a banking
corporation and is duly organized, validly existing, and in good standing under
the laws of the state of incorporation listed on such Exhibit A.  The Borrower
and each of its Subsidiaries has the corporate power and authority to own its
assets and to transact the business in which it is now engaged or proposed to be
engaged; and is duly qualified as a foreign corporation and in good standing
under the laws of each other jurisdiction in which such qualification is
required.

Section 4.02.  Corporate Power and Authority. The execution, delivery, and
performance by the Borrower of the Loan Documents and the creation of the
security interest provided for under the Security Agreement are within the
Borrower's corporate powers and have been duly authorized by all necessary
corporate action and do not and will not (1) require any consent or approval of
the stockholders of the Borrower; (2) contravene the Borrower's charter or
bylaws; (3) violate any provision of any law, rule, regulation (including,
without limitation, Regulations U and X of the Board of Governors of the Federal
Reserve System), order, writ, judgment, injunction, decree, determination, or
award presently in effect having applicability to the Borrower; (4) result in a
breach of or constitute a default under any indenture or loan or credit
agreement or any other agreement, lease, or instrument to which Borrower is a
party or by which it or its properties may be bound or affected; (5) result in,
or require, the creation or imposition of any Lien, except as contemplated by
the Security Agreement, upon or with respect to any of the properties now owned
or hereafter acquired by the Borrower; or (6) cause the Borrower to be in
default under any such law, rule, regulation, order, writ, judgment, injunction,
decree, determination, or award of any such indenture, agreement, lease, or
instrument.

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Section 4.03.  Legally Enforceable Agreement. This Agreement is, and each of the
other Loan Documents are legal, valid, and binding obligations of the Borrower,
and enforceable against the Borrower in accordance with their respective terms,
except to the extent that such enforcement may be limited by (i) applicable
bankruptcy, insolvency, liquidation, reorganization, moratorium or other similar
laws affecting creditors' rights generally, and (ii) general principles of
equity (whether applied in a proceeding at law or in equity).

Section 4.04.  Financial Statements. The consolidated balance sheet of the
Borrower and its Subsidiaries as of December 31, 1999 and the related
consolidated statements of income, shareholder's equity, and cash flows of the
Borrower and its Subsidiaries for the fiscal year then ended, and the
accompanying footnotes, together with the opinion thereon, dated December 31,
1999 of Mauldin & Jenkins, independent certified public accountants, copies of
which have been furnished to the Lender, are complete and correct and fairly
present the financial condition of the Borrower and its Subsidiaries as at such
dates and the results of the operations of the Borrower and its Subsidiaries for
the periods covered by such statements, all in accordance with GAAP; and since
December 31, 1999, there has been no material adverse change in the condition
(financial or otherwise), business, or operations of the Borrower or any
Subsidiary.  There are no liabilities of the Borrower or any Subsidiary, fixed
or contingent, which are material but are not reflected in the financial
statements or in the notes thereto, other than liabilities arising in the
ordinary course of business since December 31, 1999.  No information, exhibit,
or report furnished by the Borrower to the Lender in connection with the
approval of the Loan or negotiation of this Agreement contains any material
misstatement of fact or omitted to state a material fact or any fact necessary
to make the statement contained therein not materially misleading.

Section 4.05.  Labor Disputes and Acts of God. Neither the business nor the
properties of the Borrower or any Subsidiary are affected by any fire,
explosion, accident, strike, lockout or other labor dispute, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy, or other casualty
(whether or not covered by insurance) materially and adversely affecting such
business or properties or the operation of the Borrower or such Subsidiary.

Section 4.06.  Other Agreements. Neither the Borrower nor any Subsidiary is a
party to any indenture, loan, credit agreement, regulatory agreement or
imposition, or to any lease

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or other agreement or instrument, or subject to any charter or corporate
restriction which could have a material adverse effect on the business,
properties, assets, operations, or conditions, financial or otherwise, of the
Borrower or any Subsidiary or the ability of the Borrower to carry out its
obligations under the Loan Documents to which it is a party.  Neither the
Borrower nor any Subsidiary is in material default in any respect in the
performance, observance, or fulfillment of any of the obligations, covenants, or
conditions contained in any agreement or instrument to which it is a party.

Section 4.07.  Litigation. Except as is set forth expressly on Exhibit G
attached hereto, no action or proceeding is pending or, threatened against, or
affecting, the Borrower or any of its Subsidiaries before any court, board,
commission, governmental agency, or arbitrator, which may, in any one case or in
the aggregate, materially adversely affect the financial condition, operations,
properties, or business of the Borrower or any Subsidiary or the ability of the
Borrower to perform its obligation under the Loan Documents to which it is a
party.

Section 4.08.  No Defaults on Outstanding Judgments or Orders. The Borrower and
its Subsidiaries have satisfied all material judgments, and neither the Borrower
nor any Subsidiary is in default with respect to any judgment, writ, injunction,
decree, rule, or regulation of any court, arbitrator, federal, state, municipal,
or other governmental authority, commission, board, bureau, agency, or
instrumentality, domestic or foreign, which default shall materially and
adversely affect the business or properties of Borrower and its Subsidiaries.

Section 4.09.  Ownership and Liens. The Borrower and each Subsidiary have title
to, or valid leasehold interests in, all of their properties and assets, real
and personal, including the properties and assets and leasehold interests
reflected in the financial statements referred to in Section 4.04 (other than
any properties or assets disposed of in the ordinary course of business), and
none of the properties and assets owned by the Borrower or any Subsidiary and
none of their leasehold interests is subject to any Lien, except such as may be
permitted pursuant to Section 6.01 of this Agreement.

Section 4.10.  Subsidiaries and Ownership of Stock. The Borrower's audited and
consolidated financial statement for the fiscal year ending December 31, 1999,
as provided to the Lender, includes a complete and accurate list of the
Subsidiaries of the Borrower.  All of the outstanding capital stock of each
Subsidiary has been validly issued, is fully paid

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and nonassessable, and is owned by the Borrower free and clear of all Liens.

Section 4.11.  ERISA. With respect to each Plan maintained by Borrower and each
Subsidiary, the Borrower and each Subsidiary are in compliance in all material
respects with all applicable provisions of ERISA.  Neither a Reportable Event
nor a Prohibited Transaction has occurred and is continuing with respect to any
Plan; no notice of intent to terminate a Plan has been filed, nor has any Plan
been terminated; no circumstances exist which constitute grounds entitling the
PBGC to institute proceedings to terminate, or appoint a trustee to administer,
a Plan, nor has the PBGC instituted any such proceedings; neither the Borrower
nor any Commonly Controlled Entity has completely or partially withdrawn from a
Multiemployer Plan; the Borrower and each Commonly Controlled Entity have met
their minimum funding requirements under ERISA with respect to all of their
Plans, and the present value of all vested benefits under each Plan exceeds the
fair market value of all Plan assets allocable to such benefits, as determined
on the most recent valuation date of the Plan and in accordance with the
provisions of ERISA; and neither the Borrower nor any Commonly Controlled Entity
has incurred any liability to the PBGC under ERISA.

Section 4.12.  Operation of Business. The Borrower and its Subsidiaries possess
all licenses, permits, franchises, patents, copyrights, trademarks, and trade
names, or rights thereto, necessary in all material respects to conduct their
respective businesses substantially as now conducted and as presently proposed
to be conducted, and the Borrower and its Subsidiaries are not to Borrower's
knowledge, in violation of any valid rights of others with respect to any of the
foregoing.

Section 4.13.  Taxes. The Borrower and each of its Subsidiaries have filed all
tax returns (federal, state, and local) required to be filed and have paid all
taxes, assessments, and governmental charges and levies shown thereon to be due,
including interest and penalties.  The federal income tax liabilities of the
Borrower and its Subsidiaries have been finally determined and satisfied for all
taxable years up to and including the taxable year ended December 31, 1999.

Section 4.14.  Absence of Undisclosed Liabilities. Except as reflected in the
audited consolidated balance sheet of Borrower at December 31, 1999 (including
the notes thereto), as of December 31, 1999, neither Borrower nor any Subsidiary
had any material liability or obligation whatsoever, whether accrued, absolute,
contingent, or otherwise that should, in

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accordance with GAAP, have been disclosed in such financial statements and notes
thereto.  Since December 31, 1999, neither Borrower nor any Subsidiary has
incurred any material liability or obligation, except for liabilities and
obligations incurred in the ordinary course of business or that will not have a
material adverse effect on Borrower.

Section 4.15.  Environment. The Borrower and each Subsidiary have duly complied
in all material respects with, and their businesses, operations, assets,
equipment, property, leaseholds, other real estate owned, or other facilities
are in compliance in all material respects with, the provisions of all federal
and state, environmental, health, and safety laws, codes, and ordinances, and
all rules and regulations promulgated thereunder.  Neither the Borrower nor any
Subsidiary has received notice of, nor knows of or suspects, facts which might
constitute any violations of any federal or state environmental, health, or
safety laws, codes, or ordinances, and any rules or regulations promulgated
thereunder with respect to its businesses, operations, assets (including but not
limited to real property loan collateral), equipment, property, leaseholds, or
other facilities.  Set forth in Exhibit H is a list of all real property owned
by Borrower and/or the Subsidiaries other than real property acquired pursuant
to foreclosure of a lien in favor of Borrower or any Subsidiary (or by deed in
lieu thereof) ("Real Estate Owned") or leased by the Borrower and its
Subsidiaries, wherever located, and a brief description of the business
conducted at such location.

Section 4.16.  Governmental Approval. All permits, consents, authorizations,
approvals, declarations, notifications, filings or registrations with any
Governmental Authority or  Regulatory Authority or any third party which are
necessary in all material respects in connection with the consummation of this
transaction have been obtained on or before the date hereof.

Section 4.17.  Regulatory Compliance and Notice of Regulatory Action. The
Borrower and each Subsidiary are in compliance in all material respects with all
laws, statutes, ordinances, and governmental rules, regulations, or requirements
relating to or affecting their business or operations.  There are no outstanding
notices of charges, cease-and-desist orders (temporary or otherwise), or orders
to take affirmative action issued by any Governmental Authority or Regulatory
Authority against the Borrower, any Bank or any other Subsidiary, or any
director, officer, employee or agent of the Borrower, any Bank or any other
Subsidiary.  No agreement or memorandum of

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understanding has been entered into between any Governmental Authority or
Regulatory Authority and the Borrower, any Bank or any other Subsidiary or any
director, officer, employee or agent of the Borrower, any Bank or any other
Subsidiary.  No notice of intention to remove from office or notice of intention
to suspend from office has been served upon any officer or director of the
Borrower, any Bank or any other Subsidiary by any Governmental Authority or
Regulatory Authority.

Section 4.18.  Securities Activities. The Borrower has not issued any securities
except as were (a) duly registered under the Securities Act of 1933, as amended,
and applicable blue sky laws, or (b) validly exempt from registration.

Section 4.19.  Deposit Insurance. Each Bank is an "insured depository
institution" within the meaning of Section 3 (c)(2) of the Federal Deposit
Insurance Act, as amended.

ARTICLE V

AFFIRMATIVE COVENANTS

So long as the Revolving Credit Note, the Existing Term Note and/or the
Additional Term Note shall remain unpaid or Borrower is permitted to request
advances under the Revolving Credit, the Borrower will:

Section 5.01.  Use of Proceeds. Use the proceeds of the Loan only for the
purposes set forth herein, and will furnish the Lender such evidence as it may
reasonably require with respect to such use.

Section 5.02.  Maintenance of Existence. Preserve and maintain, and cause each
Subsidiary to preserve and maintain, its corporate existence and good standing
in the jurisdiction of its incorporation, and qualify and remain qualified, and
cause each Subsidiary to qualify and remain qualified, as a foreign corporation
in each jurisdiction in which the ownership of property or the nature of its
business makes such qualification necessary or required, except where such
failure to qualify shall not materially or adversely affect the Borrower and its
Subsidiaries taken as a whole.

Section 5.03.  Maintenance of Records. Keep, and cause each Subsidiary to keep,
adequate records and books of account, in which complete entries will be made in
accordance with GAAP

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consistently applied, reflecting all financial transactions of the Borrower and
its Subsidiaries.

Section 5.04.  Maintenance of Properties. Maintain, keep, and preserve, and
cause each Subsidiary to maintain, keep, and preserve, all of its properties
(tangible and intangible) necessary or useful in the proper conduct of its
business in good working order and condition, ordinary wear and tear excepted.

Section 5.05.  Conduct of Business. Continue, and cause each Subsidiary to
continue, to engage in a business of the same general type as now conducted by
it on the date of this Agreement.

Section 5.06.  Maintenance of Insurance. Maintain and see that its Subsidiaries
maintain, or cause to be maintained, insurance coverages including, but not
limited to, bankers' blanket bonds, public liability insurance, and fire and
extended coverage insurance on all assets owned by them, all in such form and
amounts, and with such insurers, as are reasonably satisfactory to the Lender.

Section 5.07.  Compliance with Laws. Comply, and cause each Subsidiary to
comply, in all material respects with all applicable laws, rules, regulations,
orders, and material agreements to which they are subject, such compliance to
include, without limitation, maintaining adequate cash reserves for the payment
of, and paying before the same become delinquent, all taxes, assessments, and
governmental charges imposed upon it or upon its property except as contested in
good faith.

Section 5.08.  Right of Inspection. At any reasonable time and from time to time
with prior notice, permit the Lender or any agent or representatives thereof to
examine and make copies of and abstracts from the records and books of account
of, and visit the properties of, the Borrower and any Subsidiary, and to discuss
the affairs, finances, and accounts of the Borrower and any Subsidiary with any
of their respective officers and directors and the Borrower's independent
accountants.

Section 5.09.  Deposit Insurance. The Borrower will cause each Bank to maintain
federal deposit insurance and to be a member of the Federal Deposit Insurance
Corporation (or any successor thereto).

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Section 5.10.  Reporting Requirements. Furnish to the Lender:

(1)  Quarterly Financial Statements.  As soon as available and in any event
within forty-five (45) days after the end of each of the first three (3)
quarters of each fiscal year of the Borrower, interim unaudited consolidated and
unconsolidated balance sheets of Borrower, and related statements of income,
shareholders equity and cash flows of the Borrower for the prior quarter
prepared in accordance with GAAP.

(2)  Call Reports.  As soon as available, and in any event within thirty (30)
days after the end of each fiscal quarter of the Borrower, copies of all Call
Reports of the Borrower and each Bank as filed with the Federal Deposit
Insurance Corporation (or any successor thereto) and/or the Comptroller of the
Currency (or any successor), signed by the chief financial officer of the
Borrower and each Bank.

(3)  Annual Financial Statements.  As soon as available and in any event within
one hundred twenty (120) days after the end of each fiscal year of the Borrower,
consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries as of the end of such fiscal year and consolidated and
consolidating statements of income, shareholder's equity, and cash flows of the
Borrower and its Subsidiaries for such fiscal year, all in reasonable detail and
stating in comparative form the respective figures for the corresponding date
and period in the prior fiscal year and all prepared in accordance with GAAP and
accompanied by an opinion thereon acceptable to the Lender by Mauldin & Jenkins
or other accountants selected by the Borrower and acceptable to the Lender;

(4)  F.R.Y.-6 Annual Report.  As soon as available, and in any event within ten
(10) days after the filing thereof, a copy of the Borrower's F.R.Y.-6 Annual
Report to the Federal Reserve System.

(5)  Management Letters.  Promptly upon receipt thereof, copies of any reports
submitted to the Borrower or any Subsidiary by independent certified public
accountants in connection with examination of the financial statements of the
Borrower or any Subsidiary made by such accountants;

(6)  Certificate of No Default.  Within forty-five (45) days after the end of
each of the quarters of each fiscal year of the Borrower, a certificate of the
chief financial officer of the Borrower, substantially in the form of Exhibit I

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attached hereto and made a part hereof (a) certifying, inter alia, that (i) the
representations and warranties contained in Article IV hereof and in each of the
Loan Documents remain true and correct (except to the extent that such
representations and warranties relate solely to an earlier date), (ii) the
Borrower and Subsidiaries are in compliance with the covenants set forth herein,
and (iii) no Event of Default has occurred and is continuing or, if an Event of
Default has occurred and is continuing, a statement as to the nature thereof and
the action which is proposed to be taken with respect thereto; and (b) with
computations demonstrating compliance with the covenants contained in Article
VII;

(7)  Accountant's Report.  Simultaneously with the delivery of the annual
financial statements referred to in Section 5.10(3),  a statement of the
independent public accountants to the effect that, in making the examination
necessary for the audit of such statements, they have obtained no knowledge of
any condition or event which constitutes an Event of Default, or if such
accountants shall have obtained knowledge of any such condition or event,
specifying in such certificate each such condition or event, of which they have
knowledge and the nature and status thereof;

(8)  Notice of Litigation.  Promptly after the commencement thereof, notice of
all actions, suits, and proceedings before any court or governmental department,
commission, board, bureau, agency, or instrumentality, domestic or foreign,
affecting the Borrower or any Subsidiary which, if determined adversely to the
Borrower or such Subsidiary, could have a material adverse effect on the
financial condition, properties, or operations of the Borrower or such
Subsidiary;

(9)  Notice of Events of Default.  The Borrower will notify the Lender
immediately if it becomes aware of the occurrence of any Event of Default or of
any fact, condition, or event that only with the giving of notice or passage of
time, or both, could become an Event of Default, or of the failure of the
Borrower to observe any of its undertakings hereunder;

(10)  ERISA Reports.  As soon as possible, and in any event within thirty (30)
days after the Borrower knows or has reason to know that any circumstances exist
that constitute grounds entitling the PBGC to institute proceedings to terminate
a Plan with respect to the Borrower or any Commonly Controlled Entity, and
promptly, but in any event within five (5) Business Days of receipt by the
Borrower or any Commonly Controlled Entity of notice that the PBGC intends to
terminate a Plan or

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appoint a trustee to administer the same, and promptly, but in any event within
five (5) Business Days of the receipt of notice concerning the imposition of
withdrawal liability in excess of ONE HUNDRED THOUSAND AND NO/100 DOLLARS
($100,000.00) with respect to the Borrower or any Commonly Controlled Entity,
the Borrower will deliver to the Lender a certificate of the chief financial
officer of the Borrower setting forth all relevant details and the action which
the Borrower proposes to take with respect thereto;

(11)  Proxy Statements, Etc.  Promptly after the sending or filing thereof,
copies of all proxy statements, financial statements, and reports which the
Borrower or any Subsidiary sends to its stockholders, and copies of all regular,
periodic, and special reports, and all registration statements which the
Borrower or any Subsidiary files with the Securities and Exchange Commission or
any Governmental Authority which may be substituted therefor, or with any
national securities exchange;

(12)  Reports to Regulatory Agencies.  Promptly after the sending or filing of
the same, copies of all call reports and other reports, including without
limitation responses to administrative enforcement actions, and modifications or
amendments thereto, that the Borrower or its Subsidiaries sends or files with
any Regulatory Authority; and

(13)  Notice of Regulatory Action.  Promptly, written notice of (i) the issuance
of any notice of charges, cease-and-desist order (temporary or otherwise), or
order to take affirmative action by any Governmental Authority or Regulatory
Authority against the Borrower, any Bank or any other Subsidiary, or any
director, officer, employee or agent of the Borrower, any Bank or any other
Subsidiary, (ii) the service of any notice of intention to remove from office or
notice of intention to suspend from office by any Governmental Authority or
Regulatory Authority upon any director or officer of the Borrower, any Bank or
any other Subsidiary, (iii) the issuance of a notice of termination of the
status of any Bank as an insured bank under the Federal Deposit Insurance
Corporation Act, as amended, or (iv) the entering into of any agreement or
memorandum of understanding between any Governmental Authority or Regulatory
Authority and the Borrower, any Bank or any other Subsidiary, or any director,
officer, employee or agent of the Borrower, any Bank or any other Subsidiary.

(14)   Adverse Changes.  Promptly after the occurrence thereof and in no event
later than ten (10) days thereafter,

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full disclosures of any material adverse changes in the finances or business of
Borrower or any of its Subsidiaries.

(15)  General Information.  Such other information respecting the condition or
operations, financial or otherwise, of the Borrower or any Subsidiary as the
Lender may from time to time reasonably request.

Section 5.11.  Environment. Be and remain, and cause each Subsidiary to be and
remain, in all material respects, in compliance with the provisions of all
federal and state environmental, health, and safety laws, codes and ordinances,
and all rules and regulations issued thereunder; and notify the Lender
immediately of any notice of an environmental complaint received from any
governmental agency or any other party.

Section 5.12.  Capital Adequacy. Maintain, and cause each Bank to maintain, at
all times, the minimum levels of regulatory capital necessary to maintain the
regulatory capital classification of "Well Capitalized," as such term is defined
by the applicable Regulatory Authority.

ARTICLE VI

NEGATIVE COVENANTS

So long as the Revolving Credit Note, the Existing Term Note and/or the
Additional Term Note shall remain unpaid or Borrower is permitted to request
advances under the Revolving Credit, the Borrower will not:

Section 6.01.  Liens. Create, incur and assume, or suffer to exist, or permit
any Subsidiary to create, incur, assume, or suffer to exist, any Lien upon or
with respect to any of its properties (including, without limitation, any Lien
upon all or any part of the common or capital stock of any of the Banks), now
owned or hereafter acquired, except:

(1)     Liens in favor of the Lender;

(2)     Liens for taxes or assessments or other governmental charges or levies
if not yet due and payable or, if due and payable, if they are being contested
in good faith by appropriate proceedings and for which appropriate reserves are
maintained;

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(3)  Liens imposed by law, such as mechanics', materialmen's, landlords',
warehousemen's, and carriers' Liens, securing obligations incurred in the
ordinary course of business which are not yet due and payable or which are being
contested in good faith by appropriate proceedings and for which appropriate
reserves have been established;

(4)  Liens under workers' compensation, unemployment insurance, Social Security,
or similar legislation;

(5)  Liens, deposits, or pledges to secure the performance of bids, tenders,
contracts (other than contracts for the payment of money), leases (permitted
under the terms of this Agreement), public or statutory obligations, surety,
stay, appeal, indemnity, performance, or other similar bonds, or other similar
obligations arising in the ordinary course of business;

(6)  Judgment and other similar Liens arising in connection with court
proceedings, provided the execution or other enforcement of such Liens is
effectively stayed and the claims secured thereby are being actively contested
in good faith and by appropriate proceedings;

(7)  Easements, rights-of-way, restrictions, and other similar encumbrances
which, in the aggregate, do not materially interfere with the occupation, use,
and enjoyment by the Borrower or any Subsidiary of the property or assets
encumbered thereby in the normal course of its business or materially impair the
value of the property subject thereto;

(8)     Liens incidental to the conduct of banking business, not incurred in
connection with the borrowing of money, arising out of transactions in federal
funds, repurchase agreements, interbank credit facilities, bank deposits, or
other obligations to customers or depositors of the Borrower's Subsidiaries.

(9)     Liens incurred in connection with the borrowing by a Subsidiary from the
Federal Reserve Bank, or the Federal Home Loan Bank, in the ordinary course of
business;

(10) Those Liens specified in Exhibit J attached hereto and made a part hereof;
and

(11)     Liens for purchase money security interests or Liens incurred in
connection with any conditional sale or other title retention agreement or
capital lease.

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Section 6.02.  Debt. Create, incur, assume, or suffer to exist, or permit any
Subsidiary to create, incur, assume, or suffer to exist, any Debt, except:

(1)  Debt of the Borrower under this Agreement or the Loan;

(2)  Debt described in Exhibit K, and any renewals, extensions, or refinancings
of existing Debt on commercially reasonable terms (but there shall be no
voluntary prepayments of such Debt);

(3)   Debt of a Subsidiary to the Federal Reserve Bank, or the Federal Home Loan
Bank, in the ordinary course of business;

(4)  Accounts payable to trade creditors for goods or services which are not
aged more than sixty (60) days from the billing date and current operating
liabilities (other than for borrowed money) which are not more than sixty (60)
days past due, in each case incurred in the ordinary course of business, as
presently conducted, and paid within the specified time, unless contested in
good faith and by appropriate proceedings; and

(5)  Debt of the Borrower or any Subsidiary secured by purchase money liens and
security interests permitted by Section 6.01 (11), which Debt shall not exceed
FOUR HUNDRED THOUSAND AND NO/100 DOLLARS ($400,000.00) in the aggregate at any
one time outstanding.

Section 6.03.  Mergers, Acquisitions, Etc. Wind up, liquidate, or dissolve
itself, reorganize, merge, or consolidate with or into, or convey, sell, assign,
transfer, lease, or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to any Person, acquire all or substantially all of
the assets or the business of any Person, or commence or acquire any new
business not conducted by it on the date of this Agreement, or permit any
Subsidiary to do so, except that the Borrower or any Subsidiary may merge into,
consolidate with or acquire any other Person provided in each case that
immediately after giving effect thereto, no event shall occur and be continuing
which constitutes a Default or an Event of Default and, in the case of any such
merger with any other Person to which the Borrower or any Subsidiary is a party,
the Borrower or its Subsidiary is the surviving corporation.

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The Lender, in its sole discretion, may consent in writing to additional
exceptions.

Section 6.04.  Leases. Create, incur, assume, or suffer to exist, or permit any
Subsidiary to create, incur, assume, or suffer to exist, any obligation as
lessee for the rental or hire of any real or personal property, except:  (1)
leases existing on the date of this Agreement and any extensions or renewals
thereof; (2) leases (other than Capital Leases) which do not in the aggregate
require the Borrower and its Subsidiaries on a consolidated basis to make
payments (including taxes, insurance, maintenance, and similar expense which the
Borrower or any Subsidiary is required to pay under the terms of any lease) in
any fiscal year of the Borrower in excess of FOUR HUNDRED THOUSAND AND NO/100
DOLLARS ($400,000.00); (3) leases between the Borrower and any Subsidiary or
between any Subsidiaries.  The Lender, in its sole discretion, may consent in
writing to additional exceptions.

Section 6.05.  Sale and Leaseback. Sell, transfer, or otherwise dispose of, or
permit any Subsidiary to sell, transfer, or otherwise dispose of, any real or
personal property to any Person and thereafter directly or indirectly lease back
the same or similar property.

Section 6.06.  Dividends. After the date hereof, make any distribution in
respect of its capital stock or purchase, or redeem or otherwise acquire any
shares of its outstanding capital stock unless such action has been approved by
the necessary Regulatory Authorities, and further provided such distribution,
redemption or acquisition shall not impair Borrower's ability to service Debt
nor create or result in the occurrence of an Event of Default under this
Agreement or any other Loan Document. 

Section 6.07.  Sale of Assets. Sell, lease, assign, transfer, pledge, mortgage,
encumber, or otherwise dispose of, or permit any Subsidiary to sell, lease,
assign, transfer, pledge, mortgage, encumber, or otherwise dispose of, any of
its now owned or hereafter acquired assets (including, without limitation,
shares of stock and indebtedness of Subsidiaries, receivables, and leasehold
interest), except:  (1) inventory disposed of in the ordinary course of
business; (2) the sale or other disposition of assets no longer used or useful
in the conduct of its business; (3) that any Subsidiary may sell, lease, assign,
or otherwise transfer its assets to the Borrower or to any other subsidiary in
the ordinary course of business consistent with past practices; and (4) sales of
loans in the

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ordinary course of business and sales of Real Estate Owned and all other
foreclosed assets.  The Lender, in its sole discretion, may consent in writing
to additional exceptions.  The Borrower further agrees not to enter into, or
permit any Subsidiary to enter into, an agreement with or undertaking in favor
of any Person, other than the Lender, to refrain from taking any action
prohibited by this Section 6.07.

Section 6.08.  Guaranties, Etc. Assume, guarantee, endorse, or otherwise be or
become directly or contingently responsible or liable, or permit any Subsidiary
to assume, guarantee, endorse, or otherwise be or become directly or
contingently responsible or liable (including, but not limited to, an agreement
to purchase any obligation, stock, assets, goods, or services, or to supply or
advance any funds, assets, goods, or services, or an agreement to maintain or
cause such Person to maintain a minimum working capital or net worth, or
otherwise to assure the creditors of any person against loss) for obligations of
any Person, except guaranties by endorsement of negotiable instruments for
deposits or collection or similar transactions in the ordinary course of
business and except pursuant to letters of credit or other similar items
(banker's acceptances, etc.) issued by the Banks in the ordinary course of
business.

Section 6.09.  Transactions with Affiliates. Enter into any transaction,
including, without limitation, the purchase, sale, or exchange of property or
the rendering of any services, with any Affiliate, or permit any Subsidiary to
enter into any transaction, including, without limitation, the purchase, sale,
or exchange of property or the rendering of any service, with any Affiliate,
except in the ordinary course of and pursuant to the reasonable requirements of
the Borrower's or such Subsidiary's business, upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than would obtain in a
comparable arm's-length transaction with a Person not an Affiliate, and in
compliance with all applicable regulatory and statutory requirements.

ARTICLE VII

FINANCIAL COVENANTS

So long as the Revolving Credit Note, the Existing Term Note and/or the
Additional Term Note shall remain unpaid or Borrower is permitted to request
advances under the Revolving Credit:

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Section 7.01.  Capital Expenditures. Neither the Borrower nor the Borrower's
bank Subsidiaries will make any expenditures for fixed or capital assets if,
after giving effect thereto, the aggregate of all such expenditures made by the
Borrower or any bank Subsidiary would exceed FOUR MILLION AND NO/100 DOLLARS
($4,000,000.00) during any fiscal year of Borrower. Bank may, in its sole
discretion, approve in writing exceptions to this restriction.

Section 7.02.  Capital Adequacy. Maintain, and cause each Bank to maintain, at
all times, the minimum levels of regulatory capital necessary to maintain the
regulatory capital classification of "Well Capitalized," as such term is defined
by the applicable Regulatory Authority.

Section 7.03.  Return on Assets. Income from operations after taxes, divided by
average assets, on a consolidated basis shall not be less than one and one-tenth
percent (1.10%).

Section 7.04.  Return on Equity.  Income from operations after taxes, divided by
average equity, on a consolidated basis shall not be less than twelve percent
(12.0%).

Section 7.05. [Intentionally Omitted].

Section 7.06. [Intentionally Omitted].

Section 7.07. [Intentionally Omitted].

Section 7.08.  Reserves. Each Bank shall maintain at all times reserves equal to
the greater of (i) one and thirty-five one hundredths percent (1.35%) of total
loans, (ii) one hundred fifty percent (150%) of Total Non-Performing Assets, or
(iii) the minimum amount required by its primary regulator.

Section 7.09.  Asset Quality. The ratio of loans 90 days past due + non accrual
loans plus other real estate owned divided by net loans plus other real estate
owned for each Bank shall not exceed one and five tenths percent (1.5%).

Section 7:10.  Consolidated Tangible Equity.  Consolidated Tangible Equity for
Borrower and its Subsidiaries shall be greater than or equal to $38,000,000.00. 
For purposes of this Agreement, Tangible Equity shall mean equity minus
intangibles.

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Section 7.11.  Consolidated Tangible Equity to Total Assets. Consolidated
Tangible Equity for Borrower and its Subsidiaries shall be greater than or equal
to 8% of the total consolidated assets of Borrower and its Subsidiaries.

Section 7.12.  Minimum Liquidity Requirements.  Borrower and each Subsidiary
shall maintain at least the minimum levels of liquidity required for each such
entity by any applicable Regulatory Authority.

ARTICLE VIII

EVENTS OF DEFAULT

Section 8.01.  Events of Default. An Event of Default shall be deemed to exist
if any of the following events shall occur:

(1)  The Borrower shall fail to pay the principal of, or interest on, the Loan
or any other indebtedness or obligations, whether now existing or hereafter
created, payable or owing to the Lender, within five (5) days of the respective
due date;

(2)  Any representation, warranty or certification made or deemed made by the
Borrower in this Agreement, the Security Agreement, or any of the other Loan
Documents, or which is contained in any certificate, document, opinion, or
financial or other statement furnished at any time under or in connection with
any Loan Document, shall prove to have been incorrect, incomplete, or misleading
in any material respect on or as of the date made or deemed made;

(3)  The Borrower shall fail to perform or observe any term, covenant, condition
or agreement contained herein or in any other of the Loan Documents and such
failure remains unremedied for thirty (30) days after the earlier of its
discovery by the Borrower or written notice thereof to the Borrower by the
Lender;

(4)   Any Event of Default as defined (and after giving effect to any applicable
notice and/or cure periods) in any other of the Loan Documents shall occur;

(5)  The Borrower or any of its Subsidiaries shall (a) fail to pay any
indebtedness for borrowed money (other than the

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Loan or any other indebtedness or obligation, whether now existing or hereafter
created, payable or owing to the Lender) in excess of TWO HUNDRED FIFTY THOUSAND
AND NO/100 DOLLARS ($250,000.00) of the Borrower or such Subsidiary, as the case
may be, when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise); or (b) fail to perform or observe any term,
covenant, or condition on its part to be performed or observed under any
agreement or instrument relating to any such indebtedness, when required to be
performed or observed, if the effect of such failure to perform or observe is to
accelerate, or to permit the acceleration of, after the giving of notice or
passage of time, or both, the maturity of such indebtedness, whether or not such
failure to perform or observe shall be waived by the holder of such
indebtedness; or any such indebtedness shall be declared to be due and payable,
or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof and Borrower or its
Subsidiaries fails to pay such indebtedness in full;

(6)  The Borrower or any of its Subsidiaries (a) shall generally not pay, or
shall be unable to pay, or shall admit in writing its inability to pay its debts
as such debts become due; or (b) shall make an assignment for the benefit of
creditors, or petition or apply to any tribunal for the appointment of a
custodian, receiver, or trustee for it or a substantial part of its assets; or
(c) shall commence any proceeding under any bankruptcy, reorganization,
arrangement, readjustment of debt, dissolution, or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect; or (d) shall have had any
such petition or application filed or any such proceeding commenced against it
in which an order for relief is entered or an adjudication or appointment is
made, and which remains undismissed for a period of sixty(60) days or more; or
(e) shall take any corporate action indicating its consent to, approval of, or
acquiescence in any such petition, application, proceeding, or order for relief
or the appointment of a custodian, receiver, or trustee for all or any
substantial part of its properties; or (f) shall suffer any such custodianship,
receivership, or trusteeship to continue undischarged for a period of sixty (60)
days or more;

(7)  One or more judgments, decrees, or orders for the payment of money in
excess of ONE MILLION AND NO/100 DOLLARS($1,000,000.00) in the aggregate shall
be rendered against the Borrower or any of its Subsidiaries, and the amount of
said judgment(s) not covered by Borrower's or Subsidiaries' insurance is in
excess of FIVE HUNDRED THOUSAND AND NO/100

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 DOLLARS ($500,000.00), and such judgments, decrees, or orders shall continue
unsatisfied and in effect for a period of thirty (30) consecutive days without
being vacated, discharged, satisfied, or stayed or bonded pending appeal;

(8)  The Security Agreement shall at any time after its execution and delivery
and for any reason cease (a) to create a valid and perfected first priority
security interest in and to the property purported to be subject to such
Security Agreement; or (b) to be in full force and effect or shall be declared
null and void, or the validity or enforceability thereof shall be contested by
the Borrower, or the Borrower shall deny it has any further liability or
obligation under the Security Agreement, or the Borrower shall fail to perform
any of its obligations under the Security Agreement;

(9)  Any of the following events shall occur or exist with respect to the
Borrower and any Commonly Controlled Entity under ERISA: any Reportable Event
shall occur; complete or partial withdrawal from any Multiemployer Plan shall
take place; any Prohibited Transaction shall occur; a notice of intent to
terminate  a Plan shall be filed, or a Plan shall be terminated; or
circumstances shall exist which constitute grounds entitling the PBGC to
institute proceedings to terminate a Plan, or the PBGC shall institute such
proceedings; and in each case above, such event or condition, together with all
other events or conditions, if any, could subject the Borrower to any tax,
penalty, or other liability which in the aggregate may exceed FIVE HUNDRED
THOUSAND AND NO/100 DOLLARS ($500,000.00); or

(10)  If any Governmental Authority  asserts or creates a Lien upon any or all
of the assets, equipment, property, leaseholds, or other facilities of the
Borrower by reason of the occurrence of a hazardous discharge or any
environmental complaint; or if any Governmental Authority  asserts a claim
against the Borrower and/or its assets, equipment, property, leaseholds, or
other facilities for damages or cleanup costs relating to a hazardous discharge
or an environmental complaint; provided, however, that such claim shall not
constitute a default if, within ten (10) Business Days of the occurrence giving
rise to the claim, (a) the Borrower can prove to the Lender's satisfaction that
the Borrower has commenced and is diligently pursuing either:  (i) a cure or
correction of the event which constitutes the basis for the claim, and continues
diligently to pursue such cure or correction to completion or (ii) proceedings
for any injunction, a restraining order, or other appropriate emergency relief
preventing such Governmental Authority from asserting such

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claim, which relief is granted within ten (10) Business Days of the occurrence
giving rise to the claim and the injunction, order, or emergency relief is not
thereafter resolved or reversed on appeal; and (b) in either of the foregoing
events, the Borrower has posted a bond, letter of credit, or other security
satisfactory in form, substance, and amount to both the Lender and the
Governmental Authority asserting the claim to secure the proper and complete
cure or correction of the event which constitutes the basis for the claim;

    (11)  If the Borrower or any Bank, or the directors, officers, or employees
thereof, becomes subject to any regulatory enforcement action, which includes
without limitation, a memorandum of understanding, written agreement,
supervisory directive, capital directive, removal action, or cease and desist
order, which regulatory enforcement action limits or restricts the ability of
Borrower or any Bank to engage in its normal business;

(12) Borrower shall fail to maintain senior management having sufficient skill
and experience in Borrower's industry to manage Borrower and each Subsidiary
competently and efficiently.

(13)  If the ownership of Borrower as presently constituted shall change such
that more than twenty-five percent (25%) of the outstanding voting stock shall
be transferred to any Person other than (i) an existing shareholder who prior to
the transfer owned not less than  twenty-five (25%) of the outstanding voting
stock of Borrower or (ii) an immediate family member of the transferring
shareholder.

(14)  Any Bank shall be unable or shall be deemed to be unable to declare and
distribute dividends as a result of restrictions imposed by applicable
regulation or by any Regulatory Authority.

Section 8.02.     Remedies upon Event of Default

Upon the occurrence of an Event of Default, the Lender may:

(1)   By notice to the Borrower, declare the Loan and all interest thereon, and
all other amounts payable under this Agreement to be forthwith due and payable,
whereupon the Loan, all such interest, and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest, or further
notice of any kind, all of which are hereby expressly waived by the Borrower;

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(2)   At any time and from time to time, without notice to the Borrower (any
such notice being expressly waived by the Borrower), set off and apply (i) any
and all deposits (general or special, time or demand, provisional or final) at
any time held by the Lender, and (ii) other indebtedness at any time owing by
the Lender to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower, now or hereafter existing under this
Agreement, or any other Loan Document, irrespective of whether or not the Lender
shall have made any demand under this Agreement, or under any other of the Loan
Documents and although such obligations may be unmatured;

(3)     Exercise from time to time any and all rights and remedies available to
a secured party when a debtor is in default under a security agreement as
provided in the Uniform Commercial Code of Georgia, or available to Lender under
any other applicable law or in equity, including without limitation the right to
any deficiency remaining after disposition of the Collateral;

(4)   At its option, and without notice or demand of any kind, exercise from
time to time any and all other rights and remedies available to it under this
Agreement or any of the other Loan Documents;

(5)     Borrower shall pay all of the reasonable costs and expenses incurred by
Lender in enforcing its rights under this Agreement and the other Loan
Documents.  In the event any claim under this Agreement or under any of the
other Loan Documents is referred to an attorney for collection, or collected by
or through an attorney at law, Borrower will be liable to Lender for all
expenses incurred by it in seeking to enforce its rights hereunder, under any
other of the Loan Documents or in the Collateral, including without limitation
reasonable attorneys' fees; and

(6)   Any proceeds from disposition of any of the Collateral may be applied by
Lender first to the payment of all expenses and costs incurred by Lender in
enforcing the rights of Lender under each of the Loan Documents and in
collecting, retaking, holding, preparing the Collateral for and advertising the
sale or other disposition of and realizing upon the Collateral, including
without limitation reasonable attorneys' fees actually incurred, as well as all
other legal expenses and court costs.  Any balance of such proceeds may be
applied by Lender toward the payment of the Loan and in such order of
application as the Lender may from time to time elect.  Lender

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shall pay the surplus, if any, to Borrower.  Borrower shall upon demand pay the
deficiency, if any, to Lender.

ARTICLE IX

MISCELLANEOUS

Section 9.01.  Amendments, Etc. No amendment, modification, termination, or
waiver of any provision of any Loan Document to which the Borrower is a party,
nor consent to any departure by the Borrower from any Loan Document to which it
is a party, shall in any event be effective unless the same shall be in writing
and signed by the Lender , and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.

Section 9.02.  Notices, Etc. All notices and other communications provided for
under this Agreement and under the other Loan Documents shall be in writing
(including telex and facsimile transmissions) and mailed or transmitted or
delivered as follows:

> > If to the Borrower:
> > 
> > 400 North Main Street
> > Cornelia, Georgia 30531
> > Attention: Mr. Harry Stephens
> > Executive Vice President & Chief Financial Officer
> > 
> > Facsimile:(706) 776-1423
> > 
> > If to the Lender:
> > 
> > 25 Park Place
> > Mail Code: 121
> > Atlanta, Georgia 30303
> > Attention: Southeastern Financial Institutions
> > 
> > Facsimile:(404)581-1775

or, as to each party, at such other address as shall be designated by such party
in a written notice to the other party complying as to delivery with the terms
of this Section 9.02.  Except as otherwise provided in this Agreement, all such
notices and communications shall be effective when deposited in mails or sent,
answer back received via telecopier, with the original deposited in the mail,
respectively, addressed as aforesaid,

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except that notices to the Lender pursuant to the provisions of Section 3.01
shall not be effective until received by the Lender.

Section 9.03.  No Waiver. No failure or delay on the part of the Lender in
exercising any right, power, or remedy granted hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right,
power, or remedy preclude any other or further exercise thereof or the exercise
of any other right, power, or remedy hereunder. 

Section 9.04.  Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the Borrower and the Lender and their respective
successors and assigns, except that the Borrower may not assign or transfer any
of its rights under any Loan Document to which the Borrower is a party without
the prior written consent of the Lender.

Section 9.05.  Costs, Expenses, and Taxes. The Borrower agrees to pay on demand
all costs and expenses incurred by the Lender in connection with the
preparation, execution, delivery, filing, and administration of the Loan
Documents, and of any amendment, modification, or supplement to the Loan
Documents, including, without limitation, the fees and out-of-pocket expenses of
counsel for the Lender incurred in connection with advising the Lender as to its
rights and responsibilities hereunder.  The Borrower also agrees to pay all such
costs and expenses, including court costs and other litigation expenses,
incurred in connection with enforcement of the Loan Documents, or any amendment,
modification, or supplement thereto, whether by negotiation, legal proceedings,
or otherwise.  In addition, the Borrower shall pay any and all stamp and other
taxes and fees payable or determined to be payable in connection with the
execution, delivery, filing, and recording of any of the Loan Documents and the
other documents to be delivered under any such Loan Documents, and agrees to
hold the Lender harmless from and against any and all liabilities with respect
to or resulting from any delay in paying or omission to pay such taxes and fees.
This provision shall survive termination of this Agreement.

Section 9.06.  Integration. This Agreement and the Loan Documents contain the
entire agreement between the parties relating to the subject matter hereof and
supersede all oral statements and prior writing with respect thereto.

Section 9.07.  Indemnity. The Borrower hereby agrees to defend, indemnify, and
hold the Lender harmless from and against any and all claims, damages,
judgments, penalties,

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costs, and expenses (including reasonable attorney's fees and litigation
expenses actually incurred now or hereafter arising from the aforesaid
enforcement of this clause) arising directly or indirectly from the activities
of the Borrower and its Subsidiaries, and its predecessors in interest, or
arising directly or indirectly from the Borrower's or any Subsidiaries', or any
predecessors in interest's, violation of any environmental protection, health,
or safety law, whether such claims are asserted by any governmental agency or
any other person.  This indemnity shall survive termination of this Agreement.

Section 9.08.  Governing Law. This Agreement and the other Loan Documents shall
be governed by, and construed in accordance with, the laws of the State of
Georgia and the applicable laws of the United States of America.

Section 9.09.  Severability of Provisions. Any provision of any Loan Document
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of such Loan
Document or affecting the validity or enforceability of such provision in any
other jurisdiction.

Section 9.10.  Headings. Article and Section headings in the Loan Documents are
included in such Loan Documents for the convenience of reference only and shall
not constitute a part of the applicable Loan Documents for any other purpose.

Section 9.11.  Jury Trial Waiver. THE LENDER AND THE BORROWER HEREBY WAIVE TRIAL
BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM, WHETHER IN CONTRACT
OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THIS
AGREEMENT OR THE LOAN DOCUMENTS.  NO OFFICER OF THE LENDER HAS AUTHORITY TO
WAIVE, CONDITION, OR MODIFY THIS PROVISION.

[REMAINDER OF PAGE INTENTIONALLY BLANK]

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective officers thereunto duly authorized, as of the date first above
written.

> > > >                          COMMUNITY BANKSHARES, INC.
> > > > 
> > > >                          By:                                  
> > > >                          Title:
> > > > 
> > > >                          And:                                  
> > > >                          Title:
> > > > 
> > > >  
> > > > 
> > > >                          SUNTRUST BANK
> > > > 
> > > >                          By:                                  
> > > >                          Title:
> > > > 
> > > >                          And:                                  
> > > >                          Title:

35