EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of January 4,
2012, by and between Yadkin Valley Financial Corporation, a North Carolina
corporation (the “Company”), Yadkin Valley Bank and Trust (the “Bank”), a North
Carolina state bank and wholly owned subsidiary of the Company (the Company and
the Bank collectively referred to herein as the “Employer”) and J. Ricky
Patterson (the “Officer”).

For and in consideration of their mutual promises, covenants and conditions
hereinafter set forth, and other good and valuable consideration, the receipt
and sufficiency of which hereby is acknowledged, the parties agree as follows:

1.Employment. The Employer agrees to continue to employ the Officer and the
Officer agrees to continue to accept employment upon the terms and conditions
stated herein as the Chief Banking Officer of the Company and the Bank. The
Officer shall render such services to the Employer as are customarily performed
by persons situated in a similar executive capacity. The Officer shall promote
the business of the Employer, including being active in at least one civic
organization, and perform such other duties as shall, from time to time, be
reasonably assigned by the Board of Directors of the Company or the Bank
(collectively, the “Directors”). Upon the request of the Directors, the Officer
shall disclose all business activities or commercial pursuits in which Officer
is engaged, other than Employer duties.

2.Compensation. The Employer shall pay the Officer during the term of this
Agreement, as compensation for all services rendered by the Officer to the
Employer, a base salary at the rate of $205,000 per annum, payable in accordance
with the Employer's standard payroll practices, which for purposes of this
Agreement shall mean not less frequently than monthly. Participation in the
Employer's incentive compensation, deferred compensation, discretionary bonus,
profit-sharing, retirement and other employee benefit plans and participation in
any fringe benefits shall not reduce the salary payable to the Officer under
this Paragraph. In the event of a Change in Control (as defined in Paragraph
10), the Officer's rate of salary shall be increased not less than five percent
annually during the term of this Agreement. Any payments made under this
Agreement shall be subject to such deductions as are required by law or
regulation or as may be agreed to by the Bank and the Officer.

3.Discretionary Bonuses. During the term of this Agreement, the Officer shall be
entitled, in an equitable manner with all other key management personnel of the
Employer, to such discretionary bonuses as may be authorized, declared and paid
by the Directors to the Employer's key management employees. All such bonuses
authorized and declared by the Directors shall be paid pursuant to the
Employer's standard payroll procedures at the latest within 60 days of the
earlier of such authorization or declaration. No other compensation provided for
in this Agreement shall be deemed a substitute for the Officer's right to such
discretionary bonuses when and as declared by the Directors.

4.Participation in Retirement and Employee Benefit Plans; Fringe Benefits.

(a)The Employer shall provide family medical coverage for the Officer and the

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Officer shall also be entitled to participate in any plan relating to deferred
compensation, stock options, stock purchases, pension, thrift, profit sharing,
group life insurance, disability coverage, education, or other retirement or
employee benefits that the Employer has adopted, or may, from time to time
adopt, for the benefit of its executive employees or for employees generally,
subject to the eligibility rules of such plans. Any options or similar awards
shall be issued to the Officer at an exercise price of not less than the stock's
current fair market value (as determined in compliance with Treasury Regulation
§ 1.409A-1(b)(5)(iv)) as of the date of grant, and the number of shares subject
to such grant shall be fixed on the date of grant.

(b)The Employer shall pay the expenses of the Officer for the memberships and
dues for one country club and one civic club, if the Employee chooses to
participate in a civic club.

(c)The Officer shall also be entitled to participate in any other fringe
benefits which are now or may be or become applicable to the Employer's
executive employees, including the payment of reasonable expenses for continuing
education to maintain professional designations, and any other benefits which
are commensurate with the duties and responsibilities to be performed by the
Officer under this Agreement. Additionally, the Officer shall be entitled to
such vacation and sick leave as shall be established under uniform employee
policies promulgated by the Directors. The Employer shall reimburse the Officer
for all out-of-pocket reasonable and necessary business expenses which the
Officer may incur in connection with the Officer's services on behalf of the
Employer. The Employer shall reimburse the Officer for such expenses described
in this Paragraph 4 within 60 days of Officer's incurring such expense.

(d)The Employer shall provide the Officer with an automobile allowance equal to
$750.00 per month, subject to increase at the discretion of the Employer, which
shall be payable no less frequently than monthly and shall be used by the
Officer in his discretion for the lease or purchase of an automobile in a make
and model appropriate to the Officer's status. The Employer shall reimburse the
Officer for all reasonable expenses, including insurance coverage and gasoline,
incurred by the Officer in connection with the operation and maintenance of such
automobile. The monthly allowance and expense reimbursements shall be paid in
accordance with the Employer's standard payroll practices.

5.Term. The initial term of employment under this Agreement shall be for the
period commencing upon the effective date of this Agreement and ending three
calendar years from the effective date of this Agreement. On each anniversary of
the effective date of this Agreement, the term hereof shall automatically be
extended for an additional one year period beyond the then effective expiration
date unless written notice from the Employer or the Officer is received 90 days
prior to such anniversary advising the other that this Agreement shall not be
further extended; provided that the Directors shall review the Officer's
performance annually and make a specific determination based on such reviews
whether to renew this Agreement prior to the 90 days' notice.

6.Loyalty; Noncompetition.

(a)The Officer shall devote his full efforts and entire business time to the

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performance of his duties and responsibilities under this Agreement; provided
however that the parties acknowledge that the Officer currently serves and will
continue to serve as a referee for the National Football League. The parties
agree to continue to use reasonable efforts to minimize any business disruptions
for the Employer related to the Officer's service as a referee during the
football season.

(b)During the term of this Agreement, or any renewals thereof, and for a period
of one year after termination, the Officer agrees he will not, within 15 miles
of any Bank office operating during the term of this Agreement, directly or
indirectly, own, manage, operate, join, control or participate in the
management, operation or control of, or be employed by or connected in any
manner with any financial institution which competes with the Employer or any of
its subsidiaries without the prior written consent of the Employer; provided,
however, that the provisions of this Paragraph shall not apply in the event (i)
the Officer's employment is unilaterally terminated by the Employer for Cause
(as such term is defined in Paragraph 8(c) hereof), (ii) the Officer terminates
his employment with the Employer for “good reason” (as such term is defined in
Paragraph 10(b) hereof) following a “Change in Control” (as such term is defined
in Paragraph 10(d) hereof), or (iii) the Officer's employment is terminated
under the circumstances described in Paragraph 9(a). Notwithstanding the
foregoing, the Officer shall be free, without such consent, to purchase or hold
as an investment or otherwise, up to five percent of the outstanding stock or
other security of any corporation which has its securities publicly traded on
any recognized securities exchange or in any over the counter market.

(c)The Officer agrees he will hold in confidence all knowledge or information of
a confidential nature with respect to the business of the Employer or any
subsidiary received by the Officer during the term of this Agreement and will
not disclose or make use of such information without the prior written consent
of the Employer. The Officer agrees that he will be liable to the Employer for
any damages caused by unauthorized disclosure of such information. Upon
termination of his employment, the Officer agrees to, return all records or
copies thereof of the Employer or any subsidiary in his possession or under his
control which relate to the activities of the Employer or any subsidiary.

(d)The Officer acknowledges that it would not be possible to ascertain the
amount of monetary damages in the event of a breach by the Officer under the
provisions of this Paragraph 6. The Officer agrees that, in the event of a
breach of this Paragraph 6, injunctive relief enforcing the terms of this
Paragraph 6 is an appropriate remedy. If the scope of any restriction contained
in this Paragraph 6 is determined to be too broad by any court of competent
jurisdiction, then such restriction shall be enforced to the maximum extent
permitted by law and the Officer consents that the scope of this restriction may
be modified judicially.

7.Standards. The Officer shall perform his duties and responsibilities under
this Agreement in accordance with such reasonable standards expected of
employees with comparable positions in comparable organizations and as may be
established from time to time by the Directors. The Employer will provide the
Officer with the working facilities and staff customary for similar executives
and necessary for the Officer to perform his duties.

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8.Termination and Termination Pay. For purposes of this Agreement, the term
“terminate” or “termination” shall mean a “separation from service” as defined
by Treasury Regulation § 1.409A-1(h).

(a)The Officer's employment under this Agreement shall be terminated upon the
death of the Officer during the term of this Agreement, in which event the
Officer's estate shall be entitled to receive the base compensation due the
Officer through the last day of the calendar month in which the Officer's death
shall have occurred and for a period of one month thereafter. All such payments
due under this Paragraph 8(a) shall be paid to the estate as soon as practical
following the Officer's death.

(b)The Officer's employment under this Agreement may be terminated at any time
by the Officer upon 60 days' written notice to the Directors. Upon such
termination, the Officer shall be entitled to receive only Officer's base
compensation through the effective date of such termination. Subject to
Paragraphs 11(b) and (c) below, any amount of compensation or other benefit that
the Officer has a right to as of the date of termination under this Paragraph
8(b) shall be paid on 60th day following such termination.

(c)The Directors may terminate the Officer's employment at any time, but any
termination by the Directors, other than termination for Cause, shall not
prejudice the Officer's right to compensation or other benefits under this
Agreement. The Employer shall provide written notice specifying the grounds for
termination for Cause. The Officer shall have no right to receive compensation
or other benefits for any period after termination for Cause. Termination for
Cause shall include termination because of the Officer's personal dishonesty or
moral turpitude, incompetence, willful misconduct, breach of fiduciary duty
involving personal profit, intentional failure to perform stated duties, willful
violation of any law, rule, or regulation (other than traffic violations or
similar offenses) or final cease-and-desist order, or material breach of any
provision of this Agreement. Subject to Paragraphs 11(b) and (c) below, any
amount of compensation or other benefit that the Officer has a right to as of
the date of termination shall be paid on the 60th day following such
termination. Notwithstanding such termination, the obligations under Paragraph
6(c) shall survive any termination of employment.

(d)Subject to the Employer's obligations and the Officer's rights under (i)
Title I of the Americans with Disabilities Act, §504 of the Rehabilitation Act,
and the Family and Medical Leave Act, and to (ii) the vacation leave, disability
leave, sick leave and any other leave policies of the Employer, the Officer's
employment under this Agreement automatically shall be terminated in the event
that the Employer determines that the Officer has become disabled (as defined by
Treasury Regulation § 1.409A-3(i)(4)) during the term of this Agreement. Upon
any such termination, the Officer shall be entitled to receive any compensation
the Officer shall have earned prior to the date of termination but which remains
unpaid, and all such amounts shall be paid to the Officer as soon as practical
following the Officer's termination. The Officer shall also be entitled to
receive any payments provided under any disability income plan of the Employer
which is applicable to the Officer.

In the event of any disagreement between the Officer and the Employer as to
whether

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the Officer is physically or mentally disabled such as will result in the
termination of the Officer's employment pursuant to this Paragraph 8(d), the
question of such disability shall be submitted to an impartial physician
licensed to practice medicine in North Carolina for determination and who will
be selected by mutual agreement of the Officer and the Employer, or failing such
agreement, by two (2) physicians (one (1) of whom shall be selected by the
Employer and the other by the Officer), and such determination of the question
of such disability by such physician or physicians shall be final and binding on
the Officer and the Employer. The Employer shall pay the reasonable fees and
expenses of such physician or physicians in making any determination required
under this Paragraph 8(d).

9.Additional Regulatory Requirements. Notwithstanding anything contained in this
Agreement to the contrary, it is understood and agreed that the Employer (or any
of its successors in interest) shall not be required to make any payment or take
any action under this Agreement if:

(a)the Bank is declared by any governmental agency having jurisdiction over the
Bank (hereinafter referred to as “Regulatory Authority”) to be insolvent, in
default or operating in an unsafe or unsound manner; provided however that, if
the Officer's employment with the Employer shall terminate as described in
Paragraph 8 hereof within 90 days of such declaration, then Paragraph 6(b) of
this Agreement shall not apply to the Officer following such termination; or,

(b)in the opinion of counsel to the Employer, such payment or action (i) would
be prohibited by or would violate any provision of state or federal law
applicable to the Employer, including, without limitation, the Federal Deposit
Insurance Act as now in effect or hereafter amended, (ii) would be prohibited by
or would violate any applicable rules, regulations, orders or statements of
policy, whether now existing or hereafter promulgated, of any Regulatory
Authority, or (iii) otherwise would be prohibited by any Regulatory Authority.

10.Change in Control.

(a)In the event of a termination of the Officer's employment in connection with,
or within twenty-four months after, a “Change in Control” (as defined in
Subparagraph (d) below) of the Employer other than for Cause (as defined in
Paragraph 8), the Officer shall be entitled to receive liquidated damages as set
forth in Subparagraph (c) below. Such sum shall be payable as provided in
Subparagraph (e) below.

(b)In addition to any rights the Officer might have to terminate this Agreement
contained in Paragraph 8, the Officer shall have the right to terminate this
Agreement for “good reason”, as such term is defined by Treasury Regulation §
1.409A-1(n)(2), within twenty-four months following a Change in Control of the
Bank.

(c)In the event that the Officer or the Employer terminates this Agreement
pursuant to this Paragraph 10, the Employer will be obligated to pay or cause to
be paid to Officer liquidated damages in an amount equal to 2.99 times the
Officer's “base amount” as defined in Section 280G(b)(3) of the Internal Revenue
Code of 1986, as amended (the “Code”).

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(d)For the purposes of this Agreement, the term Change in Control shall mean as
defined by Treasury Regulation § 1.409A-3(i)(5). Notwithstanding the other
provisions of this Paragraph 10, a transaction or event shall not be considered
a Change in Control if, prior to the consummation or occurrence of such
transaction or event, Officer and Bank agree in writing that the same shall not
be treated as a Change in Control for purposes of this Agreement.

(e)Subject to Paragraph 11(b) below, such amounts payable pursuant to this
Paragraph 10 shall be paid in one lump sum payment within fifteen days following
termination of this Agreement.

(f)Following an event constituting good reason for termination which gives rise
to Officer's rights hereunder, the Officer shall have twelve months from the
date of occurrence of such event to terminate this Agreement pursuant to this
Paragraph 10. Any such termination shall be deemed to have occurred only upon
delivery to the Employer (or to any successor corporation) of written notice of
termination which describes the Change in Control and the event constituting
good reason. If Officer does not so terminate this Agreement within such
twelve-month period, he shall thereafter have no further rights hereunder with
respect to the event constituting good reason, but shall retain rights, if any,
hereunder with respect to any other event constituting good reason as to which
such period has not expired.

(g)It is the intent of the parties hereto that all payments made pursuant to
this Agreement be deductible by the Employer for federal income tax purposes and
not result in the imposition of an excise tax on the Officer. Notwithstanding
anything contained in this Agreement to the contrary, any payments to be made to
or for the benefit of the Officer which are deemed to be “parachute payments” as
that term is defined in Section 280G of the Code, shall be modified or reduced
to the extent deemed to be necessary by the Directors to avoid the imposition of
excise taxes on the Officer under Section 4999 of the Code or the disallowance
of a deduction to the Employer under Section 280(a) of the Code.

11.Conditions to any Payment of Severance Amounts.

(a)This Agreement shall inure to the benefit of and be binding upon any
corporate or other successor of the Employer which shall acquire, directly or
indirectly, by conversion, merger, purchase or otherwise, all or substantially
all of the assets of the Employer.

(b)If: (1) when the Officer's employment terminates under this Agreement he is a
specified employee, as defined in Section 409A of the Code or the regulations
promulgated thereunder; (2) the Officer's employment did not terminate because
of his death; (3) any payments under this Agreement will result in additional
tax or interest to the Officer because of Section 409A or the regulations
promulgated thereunder; and (4) an exemption from the six-month delay
requirement of Section 409A(a)(2)(B)(i) is not available, then despite any
provision of this Agreement to the contrary the Officer will not be entitled to
such payments until the earlier of: (1) six months and one day after termination
of the Officer's employment; or (2) his death. Payments that would have
otherwise been paid during such six month and one day period shall be
accumulated

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and paid on the earlier of: (1) the first day of the seventh month after such
termination of employment; or (2) death of the Officer; and the remaining amount
of any such payment due under this Agreement shall be paid as set forth
elsewhere in this Agreement without regard to this Paragraph.

(c)Within 45 days of the Officer's termination of employment, and as a condition
to the Employer's obligation to provide any severance benefits under this
Agreement, the Officer shall enter into a mutually satisfactory form of release,
and may not revoke such release within the revocation period stated in such
release, which shall acknowledge such remaining obligations and discharge both
parties, as well as the Employer's officers, directors and employees with
respect to their actions for or on behalf of the Employer, from any other claims
or obligations arising out of or in connection with the Officer's employment by
the Employer, including the circumstances of such termination. In addition, if
such severance payment is made by the Employer, and if the 45 day period spans
two calendar years, regardless of when such release is executed by the Officer,
such severance payment must be made in the subsequent calendar year, regardless
of when the release is executed by the Officer.

12.Successors and Assigns.

(a)This Agreement shall inure to the benefit of and be binding upon any
corporate or other successor of the Employer which shall acquire, directly or
indirectly, by conversion, merger, purchase or otherwise, all or substantially
all of the assets of the Employer.

(b)Since the Employer is contracting for the unique and personal skills of the
Officer, the Officer shall be precluded from assigning or delegating his rights
or duties hereunder without first obtaining the written consent of the Employer.

13.Modification; Wavier; Amendments. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing, signed by the Officer and on behalf of the Employer by
such officer as may be specifically designated by the Directors. No waiver by
either party hereto, at any time, of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No amendment or
addition to this Agreement shall be binding unless in writing and signed by both
parties, except as herein otherwise provided.

14.Applicable Law. This Agreement shall be governed in all respects whether as
to validity, construction, capacity, performance or otherwise, by the laws of
North Carolina, except to the extent that federal law shall be deemed to apply.

15.Severability. The provisions of this Agreement shall be deemed severable and
the invalidity or unenforceability of any provision shall not affect the
validity or enforceability of the other provisions hereof.

16.Entire Agreement. This Agreement constitutes the entire agreement of the
parties pertaining to the employment of the Officer and supersedes all prior and
contemporaneous agreements, representations, and understandings of the parties.
Officer agrees that no promises,

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representations, or inducements have been made which caused Officer to sign this
Agreement other than those which are expressly set forth above.

17.Compliance with Internal Revenue Code Section 409A. The Employer and the
Officer intend that their exercise of authority or discretion under this
Agreement shall comply with section 409A of the Internal Revenue Code of 1986.
If any provision of this Agreement does not satisfy the requirements of section
409A, such provision shall nevertheless be applied in a manner consistent with
those requirements. In addition, each payment hereunder is intended to
constitute a separate payment from each other payment for purposes of Treasury
Regulation Section 1.409A-2(b)(2). References in this Agreement to section 409A
of the Internal Revenue Code of 1986 include rules, regulations, and guidance of
general application issued by the Department of the Treasury under Internal
Revenue Code section 409A.

18.Compliance with the Dodd-Frank Wall Street Reform and Consumer Protection
Act. Notwithstanding anything to the contrary herein, any incentive payments to
the Officer shall be limited to the extent required under the Dodd-Frank Wall
Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), including, but
not limited to, clawbacks for such incentive payments as required by the
Dodd-Frank Act. The Officer agrees to such amendments, agreements, or waivers
that are required by the Dodd-Frank Act or requested by the Employer to comply
with the terms of the Dodd-Frank Act.

(Signatures appear on the following page.)

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first hereinabove written.

YADKIN VALLEY FINANCIAL
CORPORATION
ATTEST:
By:/s/Allison Forsyth                By: /s/Joseph H. Towell            
Name:    Allison Forsyth                Name: Joseph H. Towell
Title: President and Chief Executive Officer
                            
YADKIN VALLEY BANK AND TRUST
ATTEST:
By: /s/Allison Forsyth                By: /s/Joseph H. Towell            
Name:    Allison Forsyth                Name: Joseph H. Towell
Title: President and Chief Executive Officer

                        

OFFICER

/s/J. Ricky Patterson                
J. Ricky Patterson

/s/Jan H. Hollar                
Witness