Exhibit 10.1

 

EXECUTION COPY

 

 

REVOLVING CREDIT AGREEMENT

 

 

dated as of August 30, 2005

 

 

between

 

 

GREENE COUNTY BANCSHARES, INC.

as Borrower

 

 

and

 

 

SUNTRUST BANK

as Lender

 

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TABLE OF CONTENTS

 

 

 

Page

ARTICLE I.

DEFINITIONS; CONSTRUCTION

 

 

 

Section 1.1.

Definitions

1

Section 1.2.

Accounting Terms and Determination

8

Section 1.3.

Terms Generally

8

 

 

ARTICLE II. AMOUNT AND TERMS OF THE REVOLVING COMMITMENTS

 

 

 

 

Section 2.1.

Revolving Loans and Revolving Credit Note

8

Section 2.2.

Procedure for Revolving Loans

9

Section 2.3.

Optional Reduction and Termination and/or Extension of Revolving Commitment

9

Section 2.4.

Repayment and Prepayments of Revolving Loans

9

Section 2.5.

Interest on Loans

10

Section 2.6.

Fees

10

Section 2.7.

Computation of Interest and Fees

10

Section 2.8.

Inability to Determine Interest Rates

10

Section 2.9.

Illegality

11

Section 2.10.

Increased Costs

11

Section 2.11.

Payments Generally

12

 

 

 

ARTICLE III. CONDITIONS PRECEDENT TO REVOLVING LOANS

 

 

 

 

Section 3.1.

Conditions to Initial Revolving Loan

12

Section 3.2.

Each Revolving Loan

12

 

 

 

ARTICLE IV. REPRESENTATIONS AND WARRANTIES

 

 

 

 

Section 4.1.

Existence; Power

13

Section 4.2.

Organizational Power; Authorization

13

Section 4.3.

Governmental Approvals; No Conflicts

13

Section 4.4.

Financial Statements

13

Section 4.5.

Litigation Matters

14

Section 4.6.

Compliance with Laws and Agreements

14

Section 4.7.

Investment Company Act, Etc

14

Section 4.8.

Taxes

14

Section 4.9.

Margin Regulations

14

Section 4.10.

ERISA

14

Section 4.11.

Disclosure

14

Section 4.12.

Subsidiaries

15

Section 4.13.

Dividend Restrictions; Other Restrictions

15

Section 4.14.

Capital Measures

15

Section 4.15.

FDIC Insurance

15

 

 

 

ARTICLE V. AFFIRMATIVE COVENANTS

 

 

 

 

Section 5.1.

Financial Statements and Other Information

16

Section 5.2.

Notices of Material Events

17

Section 5.3.

Existence; Conduct of Business

17

Section 5.4.

Compliance with Laws, Etc

17

Section 5.5.

Books and Records

17

Section 5.6.

Visitation, Inspection, Etc

17

 

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Section 5.7.

Maintenance of Properties; Insurance

18

Section 5.8.

Use of Proceeds

18

 

 

 

ARTICLE VI. FINANCIAL COVENANTS

 

 

 

 

Section 6.1.

Tangible Net Worth to Total Tangible Assets Ratio

18

Section 6.2.

Return on Average Assets

18

Section 6.3.

Nonperforming Assets

18

Section 6.4.

Double Leverage Ratio

18

Section 6.5.

Capital Measures

18

 

 

 

ARTICLE VII. NEGATIVE COVENANTS

 

 

 

 

Section 7.1.

Indebtedness

19

Section 7.2.

Negative Pledge

20

Section 7.3.

Fundamental Changes

20

Section 7.4.

Restricted Payments

21

Section 7.5.

Restricted Agreements

21

Section 7.6

Investments, Etc

21

Section 7.7

Sale and Leaseback Transactions

22

 

 

 

ARTICLE VIII. EVENTS OF DEFAULT

 

 

 

 

Section 8.1.

Events of Default

22

 

 

 

ARTICLE IX. MISCELLANEOUS

 

 

 

 

Section 9.1.

Notices

24

Section 9.2.

Waiver; Amendments

25

Section 9.3.

Expenses; Indemnification

25

Section 9.4.

Successors and Assigns

26

Section 9.5.

Governing Law; Jurisdiction; Consent to Service of Process

27

Section 9.6.

Waiver of Jury Trial

27

Section 9.7.

Right of Setoff

27

Section 9.8.

Counterparts; Integration

28

Section 9.9.

Survival

28

Section 9.10.

Severability

28

 

 

 

Schedules

 

 

 

 

 

Schedule 4.12

-

Subsidiaries

 

Schedule 7.1

-

Outstanding Indebtedness

 

 

 

 

 

Exhibits

 

 

 

 

 

 

 

Exhibit A

-

Revolving Credit Note

 

Exhibit 2.2

-

Notice of Revolving Borrowing

 

 

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REVOLVING CREDIT AGREEMENT

 

THIS REVOLVING CREDIT AGREEMENT (this “Agreement”) is made and entered into as
of August 30, 2005, by and between GREENE COUNTY BANCSHARES, INC.,   a Tennessee
corporation (the “Borrower”) and SUNTRUST BANK, a Georgia banking corporation
(the “Lender”).

 

W I T N E S S E T H:

 

WHEREAS, the Borrower has requested the Lender, and the Lender has agreed,
subject to the terms and conditions of this Agreement, to establish a 364-day
revolving credit facility in an original principal amount of $35,000,000, which
will reduce to $15,000,000 on and as of November 30, 2005;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the Borrower and the Lender agree as follows:

 

ARTICLE I

 

DEFINITIONS; CONSTRUCTION

 

Section 1.1.  Definitions.  In addition to the other terms defined herein, the
following terms used herein shall have the meanings herein specified (to be
equally applicable to both the singular and plural forms of the terms defined):

 

“Acquisition” shall mean any transaction or a series of related transactions for
the purpose of, or resulting, directly or indirectly, in (a) the acquisition of
all or substantially all of the assets of a Person, or of any business or
division of any Person, (b) the acquisition of greater than 50% of the capital
stock, partnership interest, membership interest or other equity of any Person,
or otherwise causing a Person to become a Subsidiary, or (c) a merger or
consolidation of, or any other combination with, another Person (other than a
Person that is a Subsidiary), provided that the Borrower or any Subsidiary is
the surviving entity.

 

“Affiliate” shall mean, as to any Person, any other Person that directly, or
indirectly through one or more intermediaries, Controls, is Controlled by, or is
under common Control with, such Person.

 

“Availability Period” shall mean the period from the Closing Date to the
Commitment Termination Date.

 

“Base Rate” shall mean the higher of (i) the per annum rate which the Lender
publicly announces from time to time to be its prime lending rate, as in effect
from time to time, and (ii) the Federal Funds Rate, as in effect from time to
time, plus one-half of one percent (0.50%). The Lender’s prime lending rate is a
reference rate and does not necessarily represent the lowest or best rate
charged to customers.  The Lender may make commercial loans or other loans at
rates of interest at, above or below the Lender’s prime lending rate.  Each
change in the Lender’s prime lending rate shall be effective from and including
the date such change is publicly announced as being effective.

 

“Business Day” shall mean (i) any day other than a Saturday, Sunday or other day
on which commercial banks in Atlanta, Georgia are authorized or required by law
to close and  (ii) if such day relates to a borrowing or continuation of, a
payment or prepayment of principal or interest on, or an Interest Period for, a
Eurodollar Loan or a notice with respect thereto, any day on which dealings in
Dollars are carried on in the London interbank market.

 

“Call Report” shall mean, with respect to Financial Institution Subsidiary,  the
“Consolidated Reports of Condition and Income” (FFIEC Form 031 or 041 or any
successor form of the Federal Financial Institutions Examination Council).

 

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“Change in Control” shall mean (a) with respect to the Borrower,  the occurrence
of one or more of the following events: (i) any sale, lease, exchange or other
transfer (in a single transaction or a series of related transactions) of all or
substantially all of the assets of the Borrower to any Person or “group” (within
the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder in effect on the date hereof), 
(ii) the acquisition of ownership, directly or indirectly, beneficially or of
record, by any Person or “group” (within the meaning of the Securities Exchange
Act of 1934 and the rules of the Securities and Exchange Commission thereunder
as in effect on the date hereof) of 50%  or more of the outstanding shares of
the voting stock of the Borrower or (iii) occupation of a majority of the seats
(other than vacant seats) on the board of directors of the Borrower by Persons
who were neither (A) nominated by the current board of directors or
(B) appointed by directors so nominated, or (b) the Borrower shall own, directly
or indirectly, less than 100% of the voting stock of any Financial Institution
Subsidiary.

 

“Change in Law” shall mean (i) the adoption of any applicable law, rule or
regulation after the date of this Agreement, (ii) any change in any applicable
law, rule or regulation, or any change in the interpretation or application
thereof, by any Governmental Authority after the date of this Agreement, or
(iii) compliance by the Lender (or for purposes of Section 2.10(b), by the
Lender’s holding company, if applicable) with any request, guideline or
directive (whether or not having the force of law) of any Governmental Authority
made or issued after the date of this Agreement.

 

“Closing Date” shall mean the date on which the conditions precedent set forth
in Section 3.1 and Section 3.2 have been satisfied or waived in accordance with
Section 9.2, and unless otherwise indicated, shall be the date of this
Agreement.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended an in effect
from time to time.

 

“Commitment Termination Date” shall mean August 29, 2006, or such later date as
the Revolving Commitment has been extended pursuant to Section 2.3, or earlier
if terminated pursuant to Section 2.3 or Section 8.1.

 

“Control” shall mean the power, directly or indirectly, either to (i) vote 5% or
more of securities having ordinary voting power for the election of directors
(or persons performing similar functions) of a Person or (ii) direct or cause
the direction of the management and policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. The terms
“Controlling”, “Controlled by”, and “under common Control with” have meanings
correlative thereto.

 

“Default” shall mean any condition or event that, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.

 

“Default Interest” shall have the meaning set forth in Section 2.5(b).

 

“Dollar(s)” and the sign “$” shall mean lawful money of the United States of
America.

 

“Double Leverage Ratio” shall mean the ratio of (a) the Borrower’s investments
in Subsidiaries and affiliated companies to (b) the Borrower’s stockholders’
equity, each calculated on a non-consolidated basis in accordance with GAAP.

 

“Environmental Laws” shall mean all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by or with any applicable Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, Release or threatened Release of any Hazardous
Material or to health and safety matters.

 

“Environmental Liability” shall mean any liability  (including any liability for
damages, costs of environmental investigation and remediation, costs of
administrative oversight, fines, natural resource damages, penalties or
indemnities), of the Borrower or any Subsidiary directly or indirectly resulting
from or based upon (a) any violation of any Environmental Law, (b) the
generation, use, handling, transportation, storage, treatment or disposal of any
Hazardous Materials, (c) any exposure to any Hazardous Materials, (d) the
Release or threatened

 

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Release of any Hazardous Materials or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.

 

“ERISA Affiliate” shall mean any trade or business (whether or not
incorporated), which, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for the purposes of
Section 302 of ERISA and Section  412 of the Code, is treated as a single
employer under Section 414 of the Code.

 

“ERISA Event” shall mean (a) any “reportable event”, as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other than
an event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator appointed by the PBGC of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan;
(f) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.

 

“Eurodollar” when used in reference to any Revolving Loan, refers to whether
such Revolving Loan bears interest at a rate determined by reference to LIBOR.

 

“Eurodollar Loan” shall mean a Revolving Loan bearing interest at a rate
determined by reference to LIBOR.

 

“Event of Default” shall have the meaning provided in Article VIII.

 

“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded
upwards, if necessary, to the next 1/100th of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with member banks of the
Federal Reserve System arranged by Federal funds brokers, as published by the
Federal Reserve Bank of New York on the next succeeding Business Day or if such
rate is not so published for any Business Day, the Federal Funds Rate for such
day shall be the average rounded upwards, if necessary, to the next 1/100th of
1% of the quotations for such day on such transactions received by the Lender
from three Federal funds brokers of recognized standing selected by the Lender.

 

“Financial Institution Subsidiary” shall mean each of (a) Greene County Bank., a
Tennessee-chartered commercial bank,  and (b) each other Subsidiary of the
Borrower hereafter formed or acquired that is a regulated financial institution.

 

“Fiscal Quarter” shall mean each fiscal quarter (including the fiscal quarter at
the fiscal year-end) of the Borrower and its Subsidiaries.

 

“FR Report Y-9C” shall mean the “Consolidated Financial Statements for Bank
Holding Companies-FR Y-9C” submitted by the Borrower as required by
Section 5(c) of the Bank Holding Company Act (12 U.S.C. 1844) and
Section 225.5(b) of Regulation Y [12 CFR 225.5(b)], or any successor or similar
replacement report.

 

“FR Report Y9-LP” shall mean the “Parent Company Only Financial Statements for
Large Bank Holding Companies-FR Y-9LP” submitted by the Borrower as required by
Section 5(c) of the Bank Holding

 

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Company Act (12 U.S.C. 1844) and Section 225.5(b) of Regulation Y [12 CFR
225.5(b)], or any successor or similar replacement report.

 

“GAAP” shall mean generally accepted accounting principles in the United States
applied on a consistent basis and subject to the terms of Section 1.2.

 

“Governmental Authority” shall mean the government of the United States of
America or any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

 

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Hedging Agreements” shall mean interest rate swap, cap or collar agreements,
interest rate future or option contracts, currency swap agreements, currency
future or option contracts, foreign exchange contracts (forward and/or spot),
commodity agreements and other similar agreements or arrangements designed to
protect against fluctuations in interest rates, currency values or commodity
values.

 

“Indebtedness” of any Person shall mean, without duplication (i) all obligations
of such Person for borrowed money, (ii) all obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments, (iii) all obligations
of such Person in respect of the deferred purchase price of property or services
(other than trade payables incurred in the ordinary course of business),
(iv) all obligations of such Person under any conditional sale or other title
retention agreement(s) relating to property acquired by such Person, (v) all
obligations of such Person under capital leases and all monetary obligations of
such Person under Synthetic Leases, (vi) all obligations, contingent or
otherwise, of such Person in respect of letters of credit, acceptances or
similar extensions of credit, (vii) all guarantees by such Person of
Indebtedness of others, (viii) all Indebtedness of a third party secured by any
Lien on property owned by such Person, whether or not such Indebtedness has been
assumed by such Person, (ix) all obligations of such Person, contingent or
otherwise, to purchase, redeem, retire or otherwise acquire for value any common
stock of such Person, and (x) all net obligations incurred by such Person under
Hedging Agreements.

 

“Interest Period” shall mean, with respect to any Eurodollar Loan, a period of
one, two, three or six months, provided that:

 

(i)                                     the initial Interest Period for any such
Loan shall commence on the date of such Loan and each Interest Period occurring
thereafter in respect of such Loan shall commence on the day on which the next
preceding Interest Period expires;

 

(ii)                                  if any Interest Period would otherwise end
on a day other than a Business Day, such Interest Period shall be extended to
the next succeeding Business Day, unless such Business Day falls in another
calendar month, in which case such Interest Period would end on the next
preceding Business Day;

 

(iii)                               any Interest Period which begins on the last
Business Day of a calendar month or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period shall
end on the last Business Day of such calendar month;

 

(iv)                              no Interest Period may extend beyond the
Commitment Termination Date.

 

“Investments” shall have the meaning set forth in Section 7.6 hereof.

 

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“LIBOR “ shall mean, for any applicable Interest Period with respect to a
Eurodollar Loan,  that rate per annum that is equal to the quotient of:

 

(I) THE RATE PER ANNUM FOR DEPOSITS IN DOLLARS FOR A PERIOD EQUAL TO SUCH
INTEREST PERIOD ON THAT PAGE OF THE TELERATE, REUTERS OR BLOOMBERG REPORTING
SERVICES  (WHICHEVER ONE IS THEN CURRENTLY BEING USED BY LENDER FOR QUOTATIONS
IN DOLLARS) WHICH DISPLAYS THE BRITISH BANKERS’ ASSOCIATION INTEREST SETTLEMENT
RATES FOR DEPOSITS IN DOLLARS AS OF 11:00 A.M. (LONDON, ENGLAND TIME) ON THE DAY
THAT IS TWO BUSINESS DAYS PRIOR TO THE FIRST DAY OF THE INTEREST PERIOD, OR IF
SUCH PAGE OR SERVICE SHALL CEASE TO BE AVAILABLE, SUCH OTHER PAGE OR SUCH OTHER
SERVICE (AS THE CASE MAY BE) FOR THE PURPOSE OF DISPLAYING BRITISH BANKERS’
ASSOCIATION INTEREST SETTLEMENT RATES FOR DOLLARS AS THE LENDER, IN ITS
DISCRETION, SHALL SELECT; PROVIDED, THAT IF THE LENDER DETERMINES THAT THE
RELEVANT FOREGOING SOURCES ARE UNAVAILABLE FOR THE RELEVANT INTEREST PERIOD,
LIBOR SHALL MEAN THE RATE OF INTEREST DETERMINED BY THE LENDER TO BE THE AVERAGE
(ROUNDED UPWARD, IF NECESSARY, TO THE NEAREST 1/100TH OF 1%) OF THE RATES PER
ANNUM AT WHICH DEPOSITS IN DOLLARS ARE OFFERED TO THE LENDER TWO (2) BUSINESS
DAYS PRECEDING THE FIRST DAY OF SUCH INTEREST PERIOD BY LEADING BANKS IN THE
LONDON INTERBANK MARKET AS OF 10:00 A. M. (ATLANTA, GEORGIA TIME) FOR DELIVERY
ON THE FIRST DAY OF SUCH INTEREST PERIOD AND FOR THE NUMBER OF DAYS COMPRISED
THEREIN, DIVIDED BY

 

(ii) a percentage equal to 1.00 minus the maximum reserve percentages (including
any emergency, supplemental, special or other marginal reserves) expressed as a
decimal (rounded upward to the next 1/100th of 1%) in effect on any day to which
the Lender is subject with respect to any LIBOR loan pursuant to regulations
issued by the Board of Governors of the Federal Reserve System with respect to
eurocurrency funding (currently referred to as “eurocurrency liabilities” under
Regulation D).  This percentage will be adjusted automatically on and as of the
effective date of any change in any reserve percentage.

 

“Lien” shall mean any mortgage, pledge, security interest, lien (statutory or
otherwise), charge, encumbrance, hypothecation, assignment, deposit arrangement,
or other arrangement having the practical effect of the foregoing or any
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including any conditional sale or other title
retention agreement and any capital lease having the same economic effect as any
of the foregoing).

 

“Loan Documents” shall mean, collectively, this Agreement, the Revolving Credit
Note, the Pledge Agreement, any Hedging Agreement entered into with Lender in
connection with the Indebtedness under this Agreement or the Revolving Credit
Note and any and all other instruments, agreements, documents and writings
executed in connection with any of the foregoing.

 

“Material Adverse Effect” shall mean, with respect to any event, act, condition
or occurrence of whatever nature (including any adverse determination in any
litigation, arbitration, or governmental investigation or proceeding), whether
singly or in conjunction with any other event or events, act or acts, condition
or conditions, occurrence or occurrences whether or not related, a material
adverse change in, or a material adverse effect on, (i) the business, results of
operations or financial condition of the Borrower and the Borrower and its
Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform any
of its obligations under the Loan Documents, (iii) the rights and remedies of
the Lender under any of the Loan Documents or (iv) the legality, validity or
enforceability of any of the Loan Documents.

 

“Multiemployer Plan” shall have the meaning set forth in Section 4001(a)(3) of
ERISA.

 

“Nonperforming Assets” shall mean the sum of (a) Nonperforming Loans,
(b) nonaccrual investment securities and (c) Other Real Estate Owned (determined
in accordance with, and as set forth on, Borrower’s FR Report Y-9C).

 

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“Nonperforming Loans” shall mean the sum of (a) nonaccrual loans and lease
financing receivables, (b) loans and lease financing receivables that are
contractually past due 90 days or more as to interest or principal and are still
accruing interest and (c) loans for which the terms have been modified due to a
deterioration in the financial position of the borrower (determined in
accordance with, and as set forth on, Borrower’s FR Report Y-9C).

 

“Notice of Borrowing” shall have the meaning as set forth in Section 2.2.

 

“Obligations” shall mean all amounts owing by the Borrower to the Lender
pursuant to or in connection with this Agreement or any other Loan Document,
including without limitation, all principal, interest (including any interest
accruing after the filing of any petition in bankruptcy or the commencement of
any insolvency, reorganization or like proceeding relating to the Borrower,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding), all reimbursement obligations,  all net obligations under
Hedging Agreements, fees, expenses, indemnification and reimbursement payments,
costs and expenses (including all fees and expenses of counsel to the Lender
incurred pursuant to this Agreement or any other Loan Document), whether direct
or indirect, absolute or contingent, liquidated or unliquidated, now existing or
hereafter arising hereunder or thereunder, together with all renewals,
extensions, modifications or refinancings thereof.

 

“Other Real Estate Owned” shall mean the sum of (a) real estate acquired in
satisfaction of debts previously contracted and (b) other real estate owned, as
set forth on Schedule HC-M of Borrower’s FR Report Y-9C.

 

“Participant” shall have the meaning set forth in Section 9.4(c).

 

“Payment Office” shall mean the office of the Lender located at 303 Peachtree
Street, Atlanta, Georgia 30308, or such other location as to which the Lender
shall have given written notice to the Borrower.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA, and any successor entity performing similar functions.

 

 “Permitted Encumbrances” shall mean

 

(i)                                     Liens imposed by law for taxes not yet
due (or, with respect to real property taxes only, not yet delinquent) or which
are being contested in good faith by appropriate proceedings and with respect to
which adequate reserves are being maintained in accordance with GAAP;

 

(ii)                                  statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, materialmen and other Liens imposed by law
created in the ordinary course of business for amounts not yet due or which are
being contested in good faith by appropriate proceedings and with respect to
which adequate reserves are being maintained in accordance with GAAP;

 

(iii)                               pledges and deposits made in the ordinary
course of business in compliance with workers’ compensation, unemployment
insurance and other social security laws or regulations;

 

(iv)                              deposits to secure the performance of bids,
trade contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case in the
ordinary course of business;

 

(v)                                 judgment and attachment liens not giving
rise to an Event of Default or Liens created by or existing from any litigation
or legal proceeding that are currently being contested in good faith by
appropriate proceedings and with respect to which adequate reserves are being
maintained in accordance with GAAP; and

 

(vi)                              easements, zoning restrictions, rights-of-way
and similar encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary obligations

 

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and do not materially detract from the value of the affected property or
materially interfere with the ordinary conduct of business of the Borrower and
its Subsidiaries taken as a whole;

 

provided, that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

 

“Person” shall mean any individual, partnership, firm, corporation, association,
joint venture, limited liability company, trust or other entity, or any
Governmental Authority.

 

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

 

“Pledge Agreement” shall mean that certain Security Agreement-Certificated
Securities, Notes, Instruments, etc. dated as of August 30, 2005 by the Borrower
in favor of the Lender.

 

“Regulation D” shall mean Regulation D of the Board of Governors of the Federal
Reserve System, as the same may be in effect from time to time, and any
successor regulations.

 

“Release” means any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into the
environment (including ambient air, surface water, groundwater, land surface or
subsurface strata) or within any building, structure, facility or fixture.

 

“Responsible Officer” shall mean any of the president, the chief executive
officer, the chief operating officer, the chief financial officer, the treasurer
or a vice president of the Borrower or such other representative of the Borrower
as may be designated in writing by any one of the foregoing with the consent of
the Lender; and, with respect to the financial covenants only, the principal
financial or accounting officer of the Borrower.

 

“Revolving Commitment” shall mean the obligation of the Lender to make Revolving
Loans to the Borrower in an aggregate principal amount not exceeding (i) from
the Closing Date to November 30, 2005,  $35,000,000 and (ii) from November 30,
2005 to the Commitment Termination Date, $15,000,000.

 

“Revolving Loan” shall mean a loan made by the Lender to the Borrower under its
Revolving Commitment, which will at all times be a Eurodollar Loan except under
circumstances set forth in Section 2.8 or Section 2.9 hereof.

 

“Revolving Credit Note” shall mean a promissory note of the Borrower payable to
the order of the Lender in the principal amount of $35,000,000, in substantially
the form of Exhibit A.

 

“Subsidiary” shall mean, with respect to any Person (the “parent”), any
corporation, partnership, joint venture, limited liability company, association
or other entity the accounts of which would be consolidated with those of the
parent in the parent’s consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, partnership, joint venture, limited liability company,
association or other entity (i) of which securities or other ownership interests
representing more than 30% of the equity or more than 30% of the ordinary voting
power, or in the case of a partnership, more than 30% of the general partnership
interests are, as of such date, owned, Controlled or held, or (ii) that is, as
of such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent. Unless
otherwise indicated, all references to “Subsidiary” hereunder shall mean a
Subsidiary of the Borrower.

 

“Synthetic Lease” of any Person shall mean (a) a lease designed to have the
characteristics of a loan for federal income tax purposes while obtaining
operating lease treatment for financial accounting purposes, or (b) an agreement
for the use or possession of property creating obligations that are not required
to appear on the balance sheet of such Person but which, upon the insolvency or
bankruptcy of such Person would be characterized by a court of competent
jurisdiction as indebtedness of such Person.

 

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“Tangible Net Worth” shall mean, as of any date, the total shareholders’ equity
of the Borrower and its Subsidiaries that would be reflected on the Borrower’s
consolidated balance sheet as of such date prepared in accordance with GAAP,
minus the amount of all assets of the Borrower and its Subsidiaries that would
be classified as intangible assets (including without limitation goodwill and
net core deposit intangible) on the Borrower’s consolidated balance sheet as of
such date prepared in accordance with GAAP.

 

“Total Loans” shall mean for the Borrower on a consolidated basis the line item 
“Net Loans” (which shall mean net of unearned interest, deferred loan fees and
cost, and Allowance for Loan Losses) set forth on the Borrower’s consolidated
balance sheet delivered pursuant to Section 5.1(a) and (b).

 

“Total Tangible Assets” shall mean, as of any date, the total assets of the
Borrower and its Subsidiaries that would be reflected on the Borrower’s
consolidated balance sheet as of such date prepared in accordance with GAAP,
minus the amount of all assets of the Borrower and its Subsidiaries that would
be classified as intangible assets (including without limitation goodwill and
net core deposit intangible) on the Borrower’s consolidated balance sheet as of
such date prepared in accordance with GAAP.

 

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.

 

Section 1.2.  Accounting Terms and Determination.  Unless otherwise defined or
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared, in accordance with GAAP as
in effect from time to time, applied on a basis consistent (except for such
changes approved by the Borrower’s independent registered public accounting
firm) with the most recent audited consolidated financial statement of the
Borrower delivered pursuant to Section 5.1(a); provided, that if the Borrower
notifies the Lender that the Borrower wishes to amend any covenant in Article VI
to eliminate the effect of any change in GAAP on the operation of such covenant
(or if the Lender notifies the Borrower that it wishes to amend Article VI for
such purpose), then the Borrower’s compliance with such covenant shall be
determined on the basis of GAAP in effect immediately before the relevant change
in GAAP became effective, until either such notice is withdrawn or such covenant
is amended in a manner satisfactory to the Borrower and the Lender.

 

Section 1.3.  Terms Generally.  The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined.  The words
“include”, “includes” and “including” shall be deemed to be followed by the
phrase “without limitation”.  In the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and
including” and the word “to” means “to but excluding”. Unless the context
requires otherwise (i) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as it was originally executed or as it
may from time to time be amended, supplemented or otherwise modified (subject to
any restrictions on such amendments, supplements or modifications set forth
herein), (ii) any reference herein to any Person shall be construed to include
such Person’s successors and permitted assigns, (iii) the words “hereof”,
“herein” and “hereunder” and words of similar import shall be construed to refer
to this Agreement as a whole and not to any particular provision hereof,
(iv) all references to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles, Sections, Exhibits and Schedules to this
Agreement and (v) all references to a specific time shall be construed to refer
to the time in the city and state of the Lender’s principal office, unless
otherwise indicated.

 

ARTICLE II

 

AMOUNT AND TERMS OF THE REVOLVING COMMITMENT

 

Section 2.1.  Revolving Loans and Revolving Credit Note.  (a) Subject to the
terms and conditions set forth herein, the Lender agrees to make Revolving Loans
to the Borrower, from time to time during the Availability Period, in an
aggregate principal amount outstanding at any time not to exceed the Revolving
Commitment. During the Availability Period, the Borrower shall be entitled to
borrow, prepay and reborrow Revolving Loans in accordance with the terms and
conditions of this Agreement; provided, that the Borrower may not borrow or
reborrow should there exist a Default or Event of Default.

 

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(b)                                 The Borrower’s obligation to pay the
principal of, and interest on, Revolving Loans shall be evidenced by the records
of the Lender and by the Revolving Credit Note.  The entries made in such
records and/or on the schedule annexed to the Revolving Credit Note, absent
manifest error,  shall be prima facie evidence of the existence and amounts of
the obligations of the Borrower therein recorded; provided, that the failure or
delay of the Lender in maintaining or making entries into any such record or on
such schedule or any error therein shall not in any manner affect the obligation
of the Borrower to repay the Revolving Loans (both principal and unpaid accrued
interest) in accordance with the terms of this Agreement.

 

Section 2.2.   Procedure for Revolving Loans.  The Borrower shall give the
Lender written notice (or telephonic notice promptly confirmed in writing) of
each Revolving Loan substantially in the form of Exhibit 2.2 (a “Notice of
Borrowing”) prior to 11:00 a.m. two (2)  Business Days prior to which a
Revolving Loan is being requested. Each Notice of Borrowing shall be irrevocable
and shall specify: (i) the principal amount of the Revolving Loan, (ii) the
proposed date of the Revolving Loan (which shall be a Business Day), and 
(iii) if the Revolving Loan is $2,500,000 or greater, its purpose (provided in
sufficient detail that is satisfactory to the Lender).  The aggregate principal
amount of each Revolving Loan shall be not less than $1,000,000 or a larger
multiple of $500,000, or in such lesser amounts equal to the amount of the
unused Revolving Commitment. Upon the satisfaction of the applicable conditions
set forth in Article III hereof, the Lender will make the proceeds of each
Revolving Loan available to the Borrower at the Payment Office on the date
specified in the applicable Notice of Borrowing by crediting an account
maintained by the Borrower with the Lender or at the Borrower’s option, by
effecting a wire transfer of such amount to an account designated by the
Borrower to the Lender.

 

Section 2.3.  Optional Reduction and Termination and/or Extension of Revolving
Commitment.

 

(a)                                  The Revolving Commitment shall terminate on
the Commitment Termination Date; provided, that the Commitment Termination Date
may be extended by the Lender for additional 364-day periods in its sole
discretion upon receiving a written request from the Borrower not earlier than
60 days and not later than 45 days prior to then existing Commitment Termination
Date for an extension. Upon the receipt of such request, the Lender shall use
its best efforts to notify the Borrower not later than 30 days prior to any
Commitment Termination Date whether it will extend the then existing Commitment
Termination Date for an additional 364-day period; provided, that the failure of
the Lender to give any such notice to the Borrower shall mean that the then
existing Commitment Termination Date will not be so extended.

 

(b)                                 Prior to November 30, 2005, the Revolving
Commitment shall be permanently reduced in an amount equal to the amount that is
prepaid pursuant to Section 2.4(d) hereof upon the issuance of capital stock or
of any trust preferred securities.

 

(c)                                  On November 30, 2005, the Revolving
Commitment shall automatically and without notice be permanently reduced to
$15,000,000.

 

(b)                                 Upon at least two (2) Business Days’ prior
written notice (or telephonic notice promptly confirmed in writing) to the
Lender (which notice shall be irrevocable), the Borrower may reduce the
Revolving Commitment in part or terminate the Revolving Commitment in whole;
provided, that (i) any partial reduction pursuant to this Section 2.3 shall be
in an amount of at least $500,000 and any larger multiple of $100,000 and
(ii) no such reduction shall be permitted which would reduce the Revolving
Commitment (after giving effect thereto and any concurrent prepayments made
under Section 2.4) to an amount less than the outstanding Revolving Loans.

 

Section 2.4.  Repayment and Prepayments of Revolving Loans.

 

(a)                                  The outstanding principal amount of all
Revolving Loans shall be due and payable (together with accrued and unpaid
interest thereon) on the Commitment Termination Date.

 

(b)                                 The Borrower shall have the right at any
time and from time to time to prepay any Eurodollar Loan, in whole or in part,
without premium or penalty, on the last day of each Interest Period and any Base
Rate Loan, in whole or in part, without premium or penalty, on any Business Day.
Each partial prepayment shall be in an amount not less than $100,000 and
integral multiples thereof; provided, that if a Eurodollar Loan is

 

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prepaid on a date other than the last day of an Interest Period applicable
thereto, the Borrower shall also pay all amounts required pursuant to
Section 2.11.

 

(c)                                  On November 30, 2005 if the aggregate
outstanding principal amount of all Revolving Loans exceeds $15,000,000, the
Borrower shall repay principal on such date equal to such excess amount,
together with accrued and unpaid interest on such excess amount.

 

(d)                                 The Borrower shall prepay the outstanding
Revolving Loans in an aggregate amount equal to the net proceeds received during
the term of this Agreement from the issuance of any trust preferred securities
or of any capital stock other than in connection with an equity incentive plan
or benefit plan for the Borrower’s or its Subsidiaries’ employees or directors
or in connection with any transaction permitted under Section 7.3 that does not
result in the Borrower receiving any cash proceeds therefrom.

 

(e)                                  All prepayments shall be applied first to
any outstanding Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period maturities.

 

Section 2.5.  Interest on Loans.

 

(a)                                  The Borrower shall pay interest on each
Eurodollar Loan (i) from the Closing Date to November 30, 2005, at LIBOR, plus
1.75% per annum and (ii) from November 30, 2005 to the Commitment Termination
Date, at LIBOR, plus 1.25% per annum. If a Base Rate Loan shall be outstanding
under the circumstances set forth in Section 2.8 or 2.9, then the Borrower shall
pay interest on each Base Rate Loan at the Base Rate in effect from time to
time.

 

(b)                                 While an Event of Default exists or after
acceleration, at the option of the Lender, the Borrower shall pay interest
(“Default Interest”) with respect to all Eurodollar Loans at the rate otherwise
applicable for the then-current Interest Period plus an additional 2% per annum
until the last day of such Interest Period, and thereafter, and with respect to
all Base Rate Loans and all other Obligations hereunder (other than Loans), at
the Base Rate, plus 2% per annum.

 

(c)                                  Interest on the principal amount of all
Revolving Loans shall accrue from and including the date such Revolving Loans
are made to but excluding the date of any repayment thereof. Interest on all
outstanding Eurodollar Loans shall be payable on the last day of each Interest
Period applicable thereto and in the case of Eurodollar Loans having an Interest
Period longer than three months, on the date which occurs every three months
after the initial date of such Interest Period, and in any case on the
Commitment Termination Date. Interest on any Base Rate Loans shall be payable on
the last day of each calendar month and on the Commitment Termination Date. All
Default Interest shall be payable on demand.

 

(d)                                 The Lender shall determine each interest
rate applicable to the Revolving Loans hereunder in accordance with the terms of
this Agreement and shall promptly notify the Borrower of such rate in writing
(or by telephone, promptly confirmed in writing).  Any such determination shall
be conclusive and binding for all purposes, absent manifest error.

 

Section 2.6.  Fees. The Borrower agrees to pay to the Lender a commitment fee,
which shall accrue at 0.15% per annum on the average daily amount of the unused
Revolving Commitment during the Availability Period. Accrued commitment fees
shall be payable in arrears on the last Business Day of each March, June,
September and December of each year and on the Commitment Termination Date,
commencing on the first such date after the Closing Date.

 

Section 2.7.  Computation of Interest and Fees. All computations of interest and
fees hereunder shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day) occurring in
the period for which such interest or fees are payable (to the extent computed
on the basis of days elapsed). Each determination by the Lender of an interest
amount or fee hereunder shall be made in good faith and, except for manifest
error, shall be final, conclusive and binding for all purposes.

 

Section 2.8.   Inability to Determine Interest Rates.  If prior to the
commencement of any Interest Period for any Eurodollar Loan, the Lender shall
have determined (which determination shall be conclusive

 

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and binding upon the Borrower) that (a) by reason of circumstances affecting the
relevant interbank market, adequate means do not exist for ascertaining LIBOR
for such Interest Period, or (b) LIBOR does not adequately and fairly reflect
the cost to the Lender of making, funding or maintaining its Eurodollar Loans
for such Interest Period, the Lender shall give written notice (or telephonic
notice, promptly confirmed in writing) to the Borrower as soon as practicable
thereafter. Until the Lender notifies the Borrower that the circumstances giving
rise to such notice no longer exist, (x) the obligation of the Lender to make
Eurodollar Loans or to continue outstanding Revolving Loans as Eurodollar Loans
shall be suspended and (y) all such affected Revolving Loans shall be converted
into Base Rate Loans on the last day of the then current Interest Period unless
the Borrower elects to prepay such Revolving Loans in accordance with this
Agreement.

 

Section 2.9.  Illegality.  If any Change in Law shall make it unlawful or
impossible for the Lender to make, maintain or fund any Eurodollar Loan, the
Lender shall promptly give notice thereof to the Borrower, whereupon until the
Lender notifies the Borrower that the circumstances giving rise to such
suspension no longer exist, the obligation of the Lender to make Eurodollar
Loans, or to continue any outstanding Revolving Loans as Eurodollar Loans, shall
be suspended. Any new Revolving Loan shall be made as a Base Rate Loan and all
then outstanding Eurodollar Loans shall be converted to a Base Rate Loan either
(x) on the last day of the then current Interest Period if the Lender may
lawfully continue to maintain such Eurodollar Loans to such date or (y)
immediately if the Lender shall determine that it may not lawfully continue to
maintain such Eurodollar Loans to such date.

 

Section 2.10.  Increased Costs.

 

(a)                                  If any Change in Law shall:

 

(i)                                     impose, modify or deem applicable any
reserve, special deposit or similar requirement that is not otherwise included
in the determination of LIBOR hereunder against assets of, deposits with or for
the account of, or credit extended by, the Lender (except any such reserve
requirement reflected in the calculation of LIBOR); or

 

(ii)                                  impose on the Lender or the eurodollar
interbank market any other condition affecting this Agreement or any Eurodollar
Loans made by the Lender; and the result of the foregoing is to increase the
cost to the Lender of making, continuing or maintaining a Eurodollar Loan or to
reduce the amount received or receivable by the Lender hereunder (whether of
principal, interest or any other amount), then the Borrower shall promptly pay,
upon written notice from and demand by the Lender, within five Business Days
after the date of such notice and demand, additional amount or amounts
sufficient to compensate the Lender for such additional costs incurred or
reduction suffered.

 

(b)                                 If the Lender shall have determined that on
or after the date of this Agreement any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on the
Lender’s capital (or on the capital of the Lender’s parent corporation) as a
consequence of its obligations hereunder to a level below that which the Lender
or the Lender’s parent corporation could have achieved but for such Change in
Law (taking into consideration the Lender’s policies or the policies of the
Lender’s parent corporation with respect to capital adequacy) then, from time to
time, within five (5) Business Days after receipt by the Borrower of written
demand by the Lender, the Borrower shall pay to the Lender such additional
amounts as will compensate the Lender or the Lender’s parent corporation for any
such reduction suffered.

 

(c)                                  A certificate of the Lender setting forth
the amount or amounts necessary to compensate the Lender or its parent
corporation, as the case may be, specified in paragraph (a) or (b) of this
Section shall be delivered to the Borrower and shall be conclusive, absent
manifest error.  The Borrower shall pay the Lender such amount or amounts within
10 days after receipt thereof.

 

(d)                                 Failure or delay on the part of the Lender
to demand compensation pursuant to this Section shall not constitute a waiver of
the Lender’s right to demand such compensation.

 

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Section 2.11.  Funding Indemnity.  In the event of (a) the payment of any
principal of a Eurodollar Loan other than on the last day of the Interest Period
applicable thereto (including as a result of an Event of Default), (b) the
continuation of a Eurodollar Loan other than on the last day of the Interest
Period applicable thereto, or (c) the failure by the Borrower to borrow, prepay,
or continue any Eurodollar Loan on the date specified in any applicable notice
(regardless of whether such notice is withdrawn or revoked), then, in any such
event,  the Borrower shall compensate the Lender, within five (5) Business Days
after written demand from the Lender,  for any cost (including without
limitation any breakage cost or redeployment cost) or expense attributable to
such event actually incurred by the Lender. A certificate as to any additional
amount payable under this Section 2.11 submitted to the Borrower by the Lender
shall be conclusive, absent manifest error.

 

Section 2.12.   Payments Generally. The Borrower shall make each payment
required to be made by it hereunder (whether of principal, interest, fees, or of
amounts payable under Section 2.10 or otherwise) prior to 12:00 noon, on the
date when due, in immediately available funds, without set-off or counterclaim.
Any amounts received after such time on any date may, in the discretion of the
Lender, be deemed to have been received on the next succeeding Business Day for
purposes of calculating interest thereon.  All such payments shall be made to
the Lender at its Payment Office.  If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be made payable for the period of such extension.  All
payments hereunder shall be made in Dollars.

 

ARTICLE III

 

CONDITIONS PRECEDENT TO REVOLVING LOANS

 

Section 3.1.   Conditions To Initial Revolving Loan.  The obligation of the
Lender to make the initial Revolving Loan hereunder is subject to the receipt by
the Lender of the following documents in form and substance reasonably
satisfactory to the Lender:

 

(a)                                  this Agreement duly executed and delivered
by the Borrower;

 

(b)                                 a duly executed Revolving Credit Note;

 

(c)                                  a duly executed Pledge Agreement and all
shares owned by the Borrower in Greene County Bank, together with blank signed
stock powers;

 

(d)                                 a certificate of the Secretary or Assistant
Secretary of the Borrower, attaching and certifying copies of its bylaws and of
the resolutions of its boards of directors, authorizing the execution, delivery
and performance of the Loan Documents and certifying the name, title and true
signature of each officer of the Borrower authorized to execute the Loan
Documents;

 

(e)                                  certified copies of the charter of the
Borrower, together with good standing certificates (or the equivalent) as may be
available from the Secretary of State of the jurisdiction of incorporation of
the Borrower and Greene County Bank and each other jurisdiction where the
Borrower or Greene County Bank is required to be qualified to do business as a
foreign corporation;

 

(f)                                    a favorable written opinion of Bass,
Berry & Sims PLC, counsel to the Borrower, addressed to the Lender, and covering
such matters relating to the Borrower, the Loan Documents and the transactions
contemplated therein as the Lender shall reasonably request; and

 

(g)                                 a duly executed funds disbursement
agreement.

 

Section 3.2.   Each Revolving Loan.   The obligation of the Lender to make each
Revolving Loan is subject to the satisfaction of the following conditions:

 

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(a)                                  at the time of and immediately after giving
effect to such Revolving Loan, no Default or Event of Default shall exist;

 

(b)                                 all representations and warranties of the
Borrower herein shall be true and correct in all material respects on and as of
the date of such Revolving Loan (other than those representations and warranties
that expressly relate to an earlier date, which shall be true and correct in all
material respects as of such earlier date) both before and after giving effect
thereto;

 

(c)                                  since December 31, 2004, there shall have
been no change which has had or would reasonably be expected to have a Material
Adverse Effect;

 

(d)                                 the Lender shall have received a duly
executed Notice of Borrowing in accordance with Section 2.2 hereof; and

 

(e)                                  the Lender shall have received such other
documents,  certificates or information as it may reasonably request, all in
form and substance reasonably satisfactory to the Lender.

 

The making of each Revolving Loan shall be deemed to constitute a representation
and warranty by the Borrower on the date thereof as to the matters specified in
paragraphs (a), (b) and (c) of this Section 3.2.

 

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Lender as follows:

 

Section 4.1.  Existence; Power. Each of the Borrower and each of its
Subsidiaries (i) is duly organized, validly existing and in good standing as a
corporation under the laws of the jurisdiction of its organization, (ii) has all
requisite power and authority to carry on its business as now conducted, and
(iii) is duly qualified to do business, and is in good standing, in each
jurisdiction where such qualification is required, except where a failure to be
so qualified could not reasonably be expected to result in a Material Adverse
Effect.

 

Section 4.2.  Organizational Power; Authorization.  The execution, delivery and
performance by the Borrower of each of the Loan Documents are within the
Borrower’s corporate powers and have been duly authorized by all necessary
corporate, and if required, stockholder, action. This Agreement and the
Revolving Credit Note have been duly executed and delivered by the Borrower and
constitute valid and binding obligations of the Borrower, enforceable against it
in accordance with their respective terms, except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws
affecting the enforcement of creditors’ rights generally and by general
principles of equity.

 

Section 4.3.  Governmental Approvals; No Conflicts. The execution, delivery and
performance by the Borrower of this Agreement and the other Loan Documents 
(a) do not require any consent or approval of, registration or filing with, or
any action by, any Governmental Authority, except those as have been obtained or
made and are in full force and effect, (b) will not violate any applicable law
or regulation or the charter or by-laws of the Borrower or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture, material agreement or other material instrument binding on the
Borrower or any of its Subsidiaries or any of its assets or give rise to a right
thereunder to require any payment to be made by the Borrower or any of its
Subsidiaries and (d) will not result in the creation or imposition of any Lien
on any asset of the Borrower or any of its Subsidiaries, other than as
contemplated by the Pledge Agreement.

 

Section 4.4.  Financial Statements.  The Borrower has furnished to the Lender
(i) the audited consolidated balance sheet of the Borrower and its Subsidiaries
as of December 31, 2004 and the related consolidated statements of income,
shareholders’ equity and cash flows for the fiscal year then ended prepared by
Dixon Hughes LLC and (ii) the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of the June 30, 2005, and the
related unaudited consolidated statements of income and cash flows for the
fiscal quarter and year-to-date period then ending, certified by a Responsible
Officer.  Such financial statements fairly

 

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present, in all material respects, the consolidated financial position of the
Borrower and its Subsidiaries as of such dates and the consolidated results of
operations and cash flows for such periods in conformity with GAAP consistently
applied, subject to year end audit adjustments and the absence of footnotes in
the case of the statements referred to in clause (ii). Since December 31, 2004,
there have been no changes with respect to the Borrower and its Subsidiaries
which have had or could reasonably be expected to have, singly or in the
aggregate, a Material Adverse Effect.

 

Section 4.5.  Litigation Matters.  No litigation, investigation or proceeding of
or before any arbitrators or Governmental Authorities is pending against, or, to
the knowledge of the Borrower, threatened against or affecting the Borrower or
any of its Subsidiaries (i) as to which there is a reasonable possibility of an
adverse determination that would reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect or (ii) which in any
manner draws into question the validity or enforceability of this Agreement or
any other Loan Document.

 

Section 4.6.  Compliance with Laws and Agreements.  The Borrower and each
Subsidiary is in compliance with (a) all applicable laws (including without
limitation all Environmental Laws and all federal and state banking statutes)
and all rules, regulations (including without limitation all banking
regulations) and orders of any Governmental Authority, and (b) all indentures,
agreements or other instruments binding upon it or its properties, except where
non-compliance, either singly or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.

 

Section 4.7.  Investment Company Act, Etc.  Neither the Borrower nor any of its
Subsidiaries is (a) an “investment company”, as defined in, or subject to
regulation under, the Investment Company Act of 1940, as amended, or (b) a
“holding company” as defined in, or subject to regulation under, the Public
Utility Holding Company Act of 1935, as amended.

 

Section 4.8.  Taxes.  The Borrower and its Subsidiaries have timely filed or
caused to be filed all Federal income tax returns and all other material tax
returns that are required to be filed by them, and have paid all taxes shown to
be due and payable on such returns or on any assessments made against it or its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority, except (i) to the extent the failure to
do so would not have a Material Adverse Effect or (ii) where the same are
currently being contested in good faith by appropriate proceedings and for which
the Borrower or such Subsidiary, as the case may be, has set aside on its books
adequate reserves.

 

Section 4.9.  Margin Regulations.  None of the proceeds of any of the Revolving
Loans will be used for “purchasing” or “carrying” any “margin stock” with the
respective meanings of each of such terms under Regulation U as now and from
time to time hereafter in effect or for any purpose that violates the provisions
of Regulation U.

 

Section 4.10.  ERISA.  No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, would reasonably be expected to
result in a Material Adverse Effect.  The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed the fair market
value of the assets of such Plan, and the present value of all accumulated
benefit obligations of all underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Standards No. 87) did not, as of the date the
most recent financial statements reflecting such amounts, exceed the fair market
value of the assets of all such underfunded Plans.

 

Section 4.11.                         Disclosure. The Borrower has disclosed to
the Lender all agreements, instruments, and corporate or other restrictions to
which the Borrower or any of its Subsidiaries is subject, and all other matters
known to any of them, that, individually or in the aggregate, would reasonably
be expected to result in a Material Adverse Effect.  None of the reports
(including without limitation all reports that the Borrower is required to file
with the Securities and Exchange Commission), financial statements, certificates
or other information furnished by or on behalf of the Borrower to the Lender in
connection with the negotiation of this Agreement or any other Loan Document or
delivered hereunder or thereunder (as modified or supplemented by any other
information

 

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so furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, taken as a whole, in
light of the circumstances under which they were made, not misleading.

 

Section 4.12.  Subsidiaries. Schedule 4.12 sets forth the name of, the ownership
interest of the Borrower in, and the jurisdiction of incorporation of, each
Financial Institution Subsidiary and each other Subsidiary, in each case as of
the Closing Date.

 

SECTION 4.13. DIVIDEND RESTRICTIONS; OTHER RESTRICTIONS.  (A) NO FINANCIAL
INSTITUTION SUBSIDIARY HAS VIOLATED ANY APPLICABLE REGULATORY RESTRICTIONS ON
DIVIDENDS, AND NO GOVERNMENTAL AUTHORITY HAS TAKEN ANY ACTION TO RESTRICT THE
PAYMENT OF DIVIDENDS BY ANY FINANCIAL INSTITUTION SUBSIDIARY.

 

(b) Other than with respect to routine examinations by any Governmental
Authority having regulatory authority over the Borrower or any of its
Subsidiaries, neither the Borrower nor any Subsidiary is, to the best of the
Borrower’s knowledge, under investigation by any such Governmental Authority or
is operating under any restrictions (excluding any restrictions on the payment
of dividends referenced in subsection (a) above) imposed by or agreed to with
any such Governmental Authority.

 

Section 4.14.  Capital Measures.  On the Closing Date, both the Borrower and
each Financial Institution Subsidiary have been, or are deemed to have been,
notified by the appropriate Governmental Authority having regulatory authority
over each of them that each of them is “well capitalized”,  as determined in
accordance with any regulations established by such Governmental Authority.

 

Section 4.15. FDIC Insurance. The deposits of each Financial Institution
Subsidiary that is an “insured depository institution” (within the meaning of
§ 12 U. S. C. 1831(c)) are insured by the FDIC and no act has occurred that
would adversely affect the status of such Financial Institution Subsidiary as an
FDIC insured bank.

 

SECTION 4.16. OFAC. NEITHER THE BORROWER NOR ANY OF ITS SUBSIDIARIES (I) IS A
PERSON WHOSE PROPERTY OR INTEREST IN PROPERTY IS BLOCKED OR SUBJECT TO BLOCKING
PURSUANT TO SECTION 1 OF EXECUTIVE ORDER 13224 OF SEPTEMBER 23, 2001 BLOCKING
PROPERTY AND PROHIBITING TRANSACTIONS WITH PERSONS WHO COMMIT, THREATEN TO
COMMIT, OR SUPPORT TERRORISM (66 FED. REG. 49079 (2001)), (II) ENGAGES IN ANY
DEALINGS OR TRANSACTIONS PROHIBITED BY SECTION 2 OF SUCH EXECUTIVE ORDER, OR IS
OTHERWISE ASSOCIATED WITH ANY PERSON IN ANY MANNER VIOLATIVE OF SAID SECTION 2
OR (III) IS A PERSON ON THE LIST OF SPECIALLY DESIGNATED NATIONALS AND BLOCKED
PERSONS OR SUBJECT TO THE LIMITATIONS OR PROHIBITIONS UNDER ANY OTHER U.S.
DEPARTMENT OF TREASURY’S OFFICE OF FOREIGN ASSETS CONTROL REGULATION OR
EXECUTIVE ORDER.

 

SECTION 4.17. PATRIOT ACT. EACH OF THE BORROWER AND ITS SUBSIDIARIES IS IN
COMPLIANCE, IN ALL MATERIAL RESPECTS, WITH (I) THE TRADING WITH THE ENEMY ACT,
AS AMENDED, AND EACH OF THE FOREIGN ASSETS CONTROL REGULATIONS OF THE UNITED
STATES TREASURY DEPARTMENT (31 CFR, SUBTITLE B, CHAPTER V, AS AMENDED) AND ANY
OTHER ENABLING LEGISLATION OR EXECUTIVE ORDER RELATING THERETO AND (II) THE
UNITING AND STRENGTHENING AMERICA BY PROVIDING APPROPRIATE TOOLS REQUIRED TO
INTERCEPT AND OBSTRUCT TERRORISM (USA PATRIOT ACT OF 2001).  NO PART OF THE
PROCEEDS OF THE OBLIGATIONS WILL BE USED, DIRECTLY OR INDIRECTLY, FOR ANY
PAYMENTS TO ANY GOVERNMENTAL OFFICIAL OR EMPLOYEE, POLITICAL PARTY, OFFICIAL OF
A POLITICAL PARTY, CANDIDATE FOR POLITICAL OFFICE, OR ANYONE ELSE ACTING IN AN
OFFICIAL CAPACITY, IN ORDER TO OBTAIN, RETAIN OR DIRECT BUSINESS OR OBTAIN ANY
IMPROPER ADVANTAGE, IN VIOLATION OF THE UNITED STATES FOREIGN CORRUPT PRACTICES
ACT OF 1977, AS AMENDED.

 

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ARTICLE V

 

AFFIRMATIVE COVENANTS

 

The Borrower covenants and agrees that so long as the Lender has a Revolving
Commitment hereunder or the principal of and interest on any Revolving Loan or
any fee remains unpaid:

 

Section 5.1.                                Financial Statements and Other
Information. The Borrower will deliver to the Lender:

 

(a)                                  as soon as available and in any event
within 90 days after the end of each fiscal year of Borrower, a copy of the
annual audited report for such fiscal year for the Borrower and its
Subsidiaries, containing (i) a consolidated balance sheet and the related
consolidated statements of income, of changes in shareholders’ equity and of
cash flows (together with all footnotes thereto), and (ii)  a condensed balance
sheet of the Borrower only and the related condensed statements of income and of
cash flows, setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail and reported on by Dixon Hughes
PLLC or other independent public accountants of nationally recognized standing
(without a “going concern” or like qualification, exception or explanation and
without any qualification or exception as to scope of such audit) to the effect
that such financial statements present fairly in all material respects the
financial condition and the results of operations and cash flows on a
consolidated basis of the Borrower for such fiscal year in accordance with GAAP
and that the examination by such accountants in connection with such financial
statements has been made in accordance with generally accepted auditing
standards;

 

(b)                                 as soon as available and in any event within
45 days after the end of each of the first three fiscal quarters of each fiscal
year of the Borrower, an unaudited balance sheet of the Borrower and its
Subsidiaries on a consolidated basis and of the Borrower on a stand alone basis
as of the end of such fiscal quarter and the related unaudited statements of
income and cash flows of the Borrower and its Subsidiaries on a consolidated
basis and of the Borrower on a stand alone basis, each for such fiscal quarter
and the then elapsed portion of such fiscal year, setting forth in each case in
comparative form the figures for the corresponding quarter and the corresponding
portion of Borrower’s previous fiscal year, all certified by the principal
financial or accounting officer of the Borrower as presenting fairly in all
material respects the financial condition and results of operations of the
Borrower and its Subsidiaries on a consolidated basis and of the Borrower on a
stand alone basis in accordance with GAAP, subject to normal year-end audit
adjustments and the absence of footnotes;

 

(c)                                  concurrently with the delivery of the
financial statements referred to in clauses (a) and (b) above, a certificate of
a Responsible Officer, (i) certifying as to whether there exists a Default or
Event of Default on the date of such certificate, and if a Default or an Event
of Default then exists, specifying the details thereof and the action which the
Borrower has taken or proposes to take with respect thereto, and (ii) setting
forth in reasonable detail calculations demonstrating compliance with
Article VI;

 

(d)                                 concurrently with the delivery of the
financial statements referred to in clauses (a) and (b) above, duly executed
copies of the Borrower’s then-current FR Report Y-9C and FR Report Y-9LP and a
duly executed copy of the then-current Call Report for each Financial
Institution Subsidiary;

 

(e)                                  promptly after the same become publicly
available, copies of all periodic and other reports, proxy statements and other
materials filed with the Securities and Exchange Commission, or any Governmental
Authority succeeding to any or all functions of said Commission, or with any
national securities exchange, or distributed by the Borrower to its shareholders
generally, as the case may be;

 

(f)                                    information required to be delivered
pursuant to paragraphs (a), (b), (c) and (d) shall be deemed to have been
delivered on the date on which the Borrower provides notice to the Lender that
such information has been posted on the Borrower’s website on the internet at
such website addresses listed on the signature page of such notice, at
www.sec.gov or at another website identified in such notice and accessible by
the Lender without charge; provided, that the Borrower shall deliver paper
copies of the reports and financial statements referred to in paragraphs (a),
(b), (c) and (d) if reasonably requested by the Lender; and

 

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(g)                                 promptly following any request therefor,
such other information regarding the results of operations, business affairs and
financial condition of the Borrower or any Subsidiary as the Lender may
reasonably request.

 

Section 5.2.  Notices of Material Events.  The Borrower will furnish to the
Lender prompt written notice of the following:

 

(a)                                              the occurrence of any Default
or Event of Default;

 

(b)                                             the filing or commencement of
any action, suit or proceeding by or before any arbitrator or Governmental
Authority against or, to the knowledge of the Borrower, affecting the Borrower
or any Subsidiary which, if adversely determined, could reasonably be expected
to result in a Material Adverse Effect;

 

(c)                                              the occurrence of any ERISA
Event that alone, or together with any other ERISA Events that have occurred,
could reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding $1,000,000;

 

(d)                                             any investigation of the
Borrower or any Subsidiary by any Governmental Agency having regulatory
authority over the Borrower or any such Subsidiary (other than routine
examinations of the Borrower and/or any such Subsidiary);

 

(e)                                              the issuance of any cease and
desist order, written agreement, cancellation of insurance or other public or
enforcement action by the FDIC or other Governmental Authority having regulatory
authority over the Borrower or any Subsidiary;

 

(f)                                                the issuance of any
memorandum of understanding or proposed disciplinary action by or from any
Governmental Authority having regulatory authority over the Borrower or any
Subsidiary, to the extent that the Borrower or any such Subsidiary is permitted
to disclose such information (provided that the Borrower shall take all
reasonable efforts to obtain any necessary regulatory consents);

 

(e)                                              any other development that
results in, or could reasonably be expected to result in, a Material Adverse
Effect.

 

Each notice delivered under this Section shall be accompanied by a written
statement of a Responsible Officer setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto.

 

Section 5.3.  Existence; Conduct of Business.  The Borrower will, and will cause
each of its Subsidiaries to, do or cause to be done all things necessary to
preserve, renew and maintain in full force and effect its legal existence and
its respective rights, licenses, permits, privileges, franchises, patents,
copyrights, trademarks and trade names material to the conduct of its business
and will continue to engage in the same business as presently conducted or such
other businesses that are reasonably related thereto; provided, that nothing in
this Section shall prohibit any merger, consolidation, liquidation or
dissolution permitted under Section 7.3.

 

Section 5.4.  Compliance with Laws, Etc. The Borrower will, and will cause each
of its Subsidiaries to, comply with all laws, rules, regulations and
requirements of any Governmental Authority (including without limitation all
federal and state banking statutes and regulations) applicable to its assets,
except where the failure to do so, either individually or in the aggregate,
would not reasonably be expected to result in a Material Adverse Effect.

 

Section 5.5.  Books and Records. The Borrower will, and will cause each of its
Subsidiaries to, keep proper books of record and account in which full, true and
correct entries shall be made of all dealings and transactions in relation to
its business and activities to the extent necessary to prepare the consolidated
financial statements of Borrower in conformity with GAAP.

 

Section 5.6.  Visitation, Inspection, Etc.  The Borrower will, and will cause
each of its Subsidiaries to, permit any representative of the Lender to visit
and inspect its properties, to examine its books and records and to make copies
and take extracts therefrom, and to discuss its affairs, finances and accounts
with any of

 

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its officers and with its independent registered public accounting firm, all at
such reasonable times and as often as the Lender may reasonably request after
reasonable prior notice to the Borrower.

 

Section 5.7.  Maintenance of Properties; Insurance. (a) The Borrower will, and
will cause each of its Subsidiaries to, (i) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear except where the failure to do so, either individually or
it the aggregate, would not reasonably be expected to result in a Material
Adverse Effect and (ii) maintain with financially sound and reputable insurance
companies, insurance with respect to its properties and business, and the
properties and business of its Subsidiaries, against loss or damage of the kinds
customarily insured against by companies in the same or similar businesses
operating in the same or similar locations.

 

(b) The deposits of each Financial Institution Subsidiary will at all times be
insured by the Federal Deposit Insurance Corporation (“FDIC”).

 

Section 5.8.  Use of Proceeds .  The Borrower will use the proceeds of all
Revolving Loans to finance working capital needs (including without limitation
acquisitions) and for other general corporate purposes of the Borrower and its
Subsidiaries. No part of the proceeds of any Revolving Loan will be used,
whether directly or indirectly, for any purpose that would violate any rule or
regulation of the Board of Governors of the Federal Reserve System, including
Regulation T, U or X.

 

ARTICLE VI

 

FINANCIAL COVENANTS

 

The Borrower covenants and agrees that so long as the Lender has its Revolving
Commitment hereunder or the principal of or interest on or any Revolving Loan
remains unpaid or any fee remains unpaid:

 

Section 6.1.  Tangible Net Worth to Total Tangible Assets Ratio.  The Borrower
on a consolidated basis will maintain at all times a ratio of Tangible Net Worth
to Total Tangible Assets (a) of not less than 4.5% from the Closing Date to
November 30, 2005 and (b) of not less than 6.5% thereafter.

 

Section 6.2. Return on Average Total Assets. The Borrower on a consolidated
basis will have at the end of each Fiscal Quarter a Return on Average Total
Assets for such Fiscal Quarter and the previous three Fiscal Quarters of not
less than 0.80%, determined by taking the sum of the Return on Average Total
Assets (adjusted for mergers, acquisitions and nonrecurring charges other than
with respect to additional loan loss reserves or other loan quality
deterioration) for each such Fiscal Quarter (as such figure is disclosed in the
Borrower’s consolidated financial statements that are submitted to the
Securities and Exchange Commission on Forms 10-K or 10-Q), divided by four (4).

 

Section 6.3.   Nonperforming Assets. The Borrower on a consolidated basis will
not permit at the end of each Fiscal Quarter Nonperforming Assets to be greater
than 1.75% of the sum of Total Loans and Other Real Estate Owned.

 

Section 6.4.   Double Leverage Ratio.                                        
The Borrower will not permit at any time its Double Leverage Ratio (a) to be
greater than 1.50 to 1.00 from the Closing Date to November 30, 2005 and (b) to
be greater than 1.35 to 1.00 thereafter.

 

Section 6.5.  Capital Measures. (a) From the Closing Date to November 30, 2005, 
the Borrower on a consolidated basis will have a Total Risk-based Capital Ratio
of 7.25% or greater, a Tier 1 Risk-based Capital Ratio of 4.0% or greater, and a
Leverage Ratio of 4.0% or greater (or 3% or greater under certain circumstances)
(each as defined by applicable federal and state regulations or orders) and
(b) from November 30, 2005 to the Commitment Termination Date, the Borrower will
be  “well-capitalized” for all applicable state and federal regulatory purposes
at all times,  and the Borrower (i) will have a Total Risk-based Capital Ratio
of 10.0% or greater, a Tier 1 Risk-based Capital Ratio of 6.0% or greater, and a
Leverage Ratio of 5.0% or greater (each as defined by applicable federal and
state regulations or orders), and will not be subject to any written agreement,

 

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order, capital directive or prompt corrective action directive by any
Governmental Authority having regulatory authority over the Borrower or (ii) if
required by any Governmental Authority having regulatory authority over the
Borrower in order to remain “well capitalized” and in compliance with all
applicable regulatory requirements, will have such higher amounts of Total
Risk-based Capital and Tier 1 Risk-based Capital and/or such greater Leverage
Ratio as specified by such Governmental Authority.

 

(b) Each Financial Institution Subsidiary of the Borrower will be “well
capitalized” for all applicable state and federal regulatory purposes at all
times, and such Financial Institution Subsidiary  (i) will have a Total
Risk-based Capital Ratio of 10.0% or greater,  a Tier 1 Risk-based Capital Ratio
of 6.0% or greater, and a Leverage Ratio of 5.0% or greater (each as defined by
applicable federal and state regulations or orders) and not be subject to any
written agreement, order, capital directive or prompt corrective action
directive by any Governmental Authority having regulatory authority over such
Financial Institution Subsidiary or (ii) if required by any Governmental
Authority having regulatory authority over such Financial Institution Subsidiary
in order to remain “well capitalized” and in compliance with all applicable
regulatory requirements, will have such higher amounts of Total Risk-based
Capital and Tier 1 Risk-based Capital and/or such greater Leverage Ratio as
specified by such Governmental Authority.

 

(c) Notwithstanding the foregoing, if at any time any such Governmental
Authority changes the definition of “well capitalized” either by amending such
ratios or otherwise, such amended definition, and any such amended or new
ratios, shall automatically be incorporated by reference into this Agreement as
the minimum standard for the Borrower or any Financial Institution Subsidiary,
as the case may be, on and as of the date that any such amendment becomes
effective by applicable statute, regulation, order or otherwise.

 

ARTICLE VII

 

NEGATIVE COVENANTS

 

The Borrower covenants and agrees that so long as the Lender has its Revolving
Commitment hereunder or the principal of or interest on any Revolving Loan
remains unpaid or any fee remains unpaid:

 

Section 7.1.  Indebtedness. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness,
except:

 

(a)                                  Indebtedness created pursuant to the Loan
Documents;

 

(b)                                 Indebtedness existing on the date hereof and
set forth on Schedule 7.1 and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof
(immediately prior to giving effect to such extension, renewal or replacement)
or shorten the maturity or the weighted average life thereof;

 

(c)                                  Indebtedness of any Financial Institution
Subsidiary (i) to the Federal Reserve Board or to the Federal Home Loan Bank
Board or (ii) constituting federal funds purchased and securities sold under
agreements to repurchase incurred in the ordinary course of business or
(iii) otherwise incurred in the ordinary course of its banking business;

 

(d)                                 Indebtedness constituting obligations of the
Borrower and any Financial Institution Subsidiary under debentures, indentures,
trust agreements and guarantees in connection with the issuance by such Persons
of trust preferred securities;

 

(e)                                  (i) Indebtedness owed by the Borrower or
any “affiliate” of the Borrower (as defined in Regulation W of the FRB and
sections 23A and 23B of the Federal Reserve Act) to any Financial Institution
Subsidiary not in violation of Regulation W of the FRB (as amended, supplemented
or otherwise modified), or (ii) Indebtedness owed by any Subsidiary to the
Borrower or (iii) Indebtedness owed by the Borrower or any Subsidiary to a
Subsidiary other than a Financial Institution Subsidiary;

 

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(f)                                    Any other Indebtedness that is
subordinated to the Indebtedness under this Agreement on the following terms:
(i) no part of the principal of such Indebtedness is stated to be payable or is
required to be paid (whether by way of mandatory sinking fund, mandatory
redemption, mandatory prepayment or otherwise) prior to the Commitment
Termination Date and the payment of principal of which and any other obligations
of the Borrower with respect thereof (other than interest subject to clause
(f)(ii)) are subordinated to the prior payment in full of principal and interest
(including post-petition interest)  and all other obligations and amounts of the
Borrower to the Lender hereunder on terms and conditions first approved in
writing by the Lender, (ii) no part of the interest accruing on such
Indebtedness is payable, without the prior written consent of the Lender, after
a Default or Event of Default has occurred and is continuing, and (iii) such
Indebtedness otherwise contains terms, covenants and conditions in form and
substance reasonably satisfactory to the Lender as evidenced by its prior
written approval thereof;

 

(g)                                 Contingent obligations calculated in
conformity with GAAP consisting of (i) the endorsement by the Borrower or any of
its Subsidiaries of negotiable instruments payable to such Person for deposit or
collection in the ordinary course of business and (ii) guarantees executed by
the Borrower or any of its Subsidiaries with respect to operating lease
obligations not in excess of $1,000,000 in the aggregate;

 

(h)                                 Contingent obligations calculated in
conformity with GAAP consisting of the indemnification by the Borrower or any of
its Subsidiaries of (i) officers, directors, employees and agents of the
Borrower or such Subsidiary, to the extent permitted under applicable law
(including any federal or state banking statute and regulation), (ii) commercial
banks, investment bankers and other independent consultants or professional
advisors pursuant to agreements relating to the underwriting of the Borrower’s
or such Subsidiary’s securities or the rendering of banking or professional
services to the Borrower or such Subsidiary and  (iii) landlords, licensors,
licensees and other parties pursuant to agreements entered into in the ordinary
course of business by the Borrower or such Subsidiary; and

 

(i)                                     Indebtedness with respect to financed
insurance premiums not past due.

 

Section 7.2.  Negative Pledge .  The Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any Lien on any
of its assets or property now owned or hereafter acquired (including without
limitation in the case of the Borrower, the capital stock of any Financial
Institution Subsidiary), except:

 

(a)                                  Liens (if any) created in favor of the
Lender pursuant to the Loan Documents;

 

(b)                                 Permitted Encumbrances;

 

(c)                                  Liens granted to secure any Indebtedness
incurred pursuant to Section 7.1(c) ( as long as in the case of
Section 7.1(c)(ii), such Lien shall only extend to those securities sold) and
Section 7.1(e); and

 

(d)                                 extensions, renewals, or replacements of any
Lien referred to in paragraphs (a), (b) and (c) of this Section.

 

Section 7.3.  Fundamental Changes.

 

(a)                                  The Borrower will not, and will not permit
any Subsidiary to, merge into or consolidate into any other Person, or permit
any other Person to merge into or consolidate with it, or sell, lease, transfer
or otherwise dispose of (in a single transaction or a series of transactions)
all or substantially all of its assets (other than in the ordinary course of
business) or all or substantially all of the stock of any of its Subsidiaries or
liquidate or dissolve; provided, that if at the time thereof and immediately
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing, (i) the Borrower or any Subsidiary may merge with a Person if
the Borrower (or such Subsidiary if the Borrower is not a party to such merger)
is the surviving Person, (ii) any Subsidiary may sell, lease, transfer or
dispose of its assets to the Borrower, (iii) any Subsidiary (other than a
Financial Institution Subsidiary) may sell, lease, transfer or dispose of its
assets to another Subsidiary and (iv) any Subsidiary (other than a Financial
Institution Subsidiary) or the assets of any Subsidiary may be sold or otherwise
transferred to a third party so long as the aggregate value of such assets and
any such Subsidiary shall not exceed

 

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$1,000,000 in any fiscal year, provided, that any Subsidiary may sell loans,
investments or other assets in the ordinary course of its business.

 

(b)                                 The Borrower will not, and will not permit
any of its Subsidiaries to, engage to any material extent in any business other
than businesses of the type conducted by the Borrower and its Subsidiaries on
the date hereof and businesses reasonably related thereto and any types of
businesses that are expressly permitted by any Governmental Authority having
jurisdiction over the Borrower and/or any Financial Institutions Subsidiary.

 

Section 7.4.  Restricted Payments. Upon the occurrence and during the
continuation of any Event of Default, the Borrower will not, and will not permit
its Subsidiaries to, declare or make, or agree to pay or make, directly or
indirectly, any dividend on any class of its stock, or make any payment on
account of, or set apart assets for a sinking or other analogous fund for, the
purchase, redemption, retirement, defeasance or other acquisition of, any shares
of common stock or Indebtedness subordinated to the Obligations of the Borrower
or any options, warrants, or other rights to purchase such common stock or such
Indebtedness, whether now or hereafter outstanding, except that any Subsidiary
may pay dividends to the Borrower at any time and the Borrower may accept shares
of its common stock in satisfaction of the exercise price or any withholding tax
obligation in connection with the exercise of any award under the Borrower’s
equity incentive plans.

 

Section 7.5.  Restrictive Agreements.  The Borrower will not, and will not
permit any Subsidiary to, directly or indirectly, enter into, incur or permit to
exist any agreement that prohibits, restricts or imposes any condition upon
(a) the ability of the Borrower or any Subsidiary to create, incur or permit any
Lien upon any of its assets or properties, whether now owned or hereafter
acquired, or (b) the ability of any Subsidiary to pay dividends or other
distributions with respect to its common stock, to make or repay loans or
advances to the Borrower or any other Subsidiary, to guarantee Indebtedness of
the Borrower or any other Subsidiary or to transfer any of its property or
assets to the Borrower or any Subsidiary of the Borrower; provided, that (i) the
foregoing shall not apply to restrictions or conditions imposed by law or
by this Agreement or any other Loan Document, (ii) the foregoing shall not apply
to customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is sold and such sale is permitted
hereunder, (iii) the foregoing shall not apply to customary market provisions
relating to the issuance of any trust preferred securities by the Borrower or
any Subsidiary of the Borrower and (iv) clause (a) shall not apply to customary
provisions in leases restricting the assignment thereof.

 

Section 7.6.  Investments, Etc The Borrower will not, and will not permit any of
its Subsidiaries to, purchase, hold or acquire (including pursuant to any merger
with any Person that was not a wholly-owned Subsidiary prior to such merger),
any common stock, Indebtedness or other securities (including any option,
warrant, or other right to acquire any of the foregoing) of, make or permit to
exist any loans or advances to, Guarantee any obligations of, or make or permit
to exist any investment or any other interest in, any other Person (all of the
foregoing being collectively called “Investments”), or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person that constitute a business unit, except:

 

(a)                                  Investments existing on the date hereof
(including Investments in Subsidiaries) that have been disclosed to the Lender
and/or that are set forth on the most current financial statements that have
been delivered to the Lender;

 

(b)                                 Investments purchased in the ordinary course
of business by any Financial Institution Subsidiary;

 

(c)                                  Investments made by the Borrower in or to
any Subsidiary and by any Subsidiary in or to the Borrower or in or to another
Subsidiary;

 

(d)                                 Investments made for the purpose of making
or consummating an Acquisition. provided, that (i)  after giving effect to such
Acquisition, no Default or Event of Default shall have occurred and be
continuing, (ii) such Acquisitions are undertaken in accordance with all
applicable laws, and (iii) the prior written consent or approval of such
Acquisition of the board of directors or equivalent governing body of the Person
being acquired. Upon the Borrower or any Subsidiary’s Investment of fifty
percent or more of the voting stock any Person that is a regulated financial
institution, such Person shall become a Financial Institution Subsidiary for
purposes of this Agreement;

 

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(e)                                  Other Investments permitted by applicable
laws and regulations;

 

(f)                                    Investments relating to the Borrower’s
guarantee of any Indebtedness permitted under Section 7.1;

 

(g)                                 advances in an aggregate amount not to
exceed $100,000  outstanding at any time made by the Borrower and its
Subsidiaries to their respective employees for reimbursable expenses incurred or
to be incurred by such employees in the ordinary course of performance of their
authorized duties;

 

(h)                                 Investments consisting of amounts
potentially due from a seller in an Acquisition that (i) relate to customary
post-closing adjustments with respect to purchased loans and/or assumed deposit
liabilities or other similar types of items that are typically subject to
post-closing adjustments and (ii) are outstanding for a period not exceeding one
hundred twenty days following the close of such Acquisition; and

 

(i)                                     Investments consisting of Hedging
Agreements entered into in the ordinary course of the Borrower’s business and
not for speculative purposes.

 

Section 7.7.  Sale and Leaseback Transactions.  The Borrower will not, and will
not permit any of the Subsidiaries to, enter into any arrangement, directly or
indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereinafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred.

 

ARTICLE VIII

 

EVENTS OF DEFAULT

 

Section 8.1.  Events of Default.  If any of the following events (each an “Event
of Default”) shall occur:

 

(a)                                  the Borrower shall fail to pay any
principal of any Revolving Loan when and as the same shall become due and
payable, whether at the due date thereof or at a date fixed for prepayment or
otherwise; or

 

(b)                                 the Borrower shall fail to pay any interest
on any Revolving Loan or any fee or any other amount (other than an amount
payable under clause (a) of this Article) payable under this Agreement or any
other Loan Document, when and as the same shall become due and payable, and such
failure shall continue unremedied for a period of three (3) days; or

 

(c)                                  any representation or warranty made or
deemed made by or on behalf of the Borrower or any Subsidiary in or in
connection with this Agreement or any other Loan Document (including the
Schedules attached thereto) and any amendments or modifications hereof or
waivers hereunder, or in any certificate, report, financial statement or other
document submitted to the Lender by the Borrower or any representative of the
Borrower pursuant to or in connection with this Agreement shall prove to be
incorrect in any material respect when made or deemed made or submitted; or

 

(d)                                 the Borrower shall fail to observe or
perform any covenant or agreement contained in Section 5.2, Section 5.3 (with
respect to the Borrower’s existence), or Articles VI or VII; or

 

(e)                                  the Borrower shall fail to observe or
perform any covenant or agreement contained (i) in this Agreement (other than
those referred to in clauses (a), (b) and (d) above), and such failure shall
remain unremedied for 30 days after the earlier of (x) any officer of the
Borrower becomes aware of such failure, or (y)  notice thereof shall have been
given to the Borrower by the Lender or any Lender or (ii) in any other Loan
Document (after taking into consideration any applicable grace periods); or

 

(f)                                    the Borrower or any Subsidiary (whether
as primary obligor or as guarantor or other surety) shall fail to pay any
principal of or premium or interest on any Indebtedness owed to the Bank
(including

 

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without limitation any Hedging Agreement or any letter of credit) in any amount
or any other Indebtedness owed to any other Person greater than $5,000,000 that
is outstanding, when and as the same shall become due and payable (whether at
scheduled maturity, required prepayment, acceleration, demand or otherwise), and
such failure shall continue after the applicable grace period, if any, specified
in the agreement or instrument evidencing such Indebtedness; or any other event
shall occur or condition shall exist under any agreement or instrument relating
to such Indebtedness and shall continue after the applicable grace period, if
any, specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or permit the acceleration of, the maturity of such
Indebtedness (without regard to whether such holders or other Person shall have
exercised or waived their right to do so); or any such Indebtedness shall be
declared to be due and payable; or required to be prepaid or redeemed (other
than by a regularly scheduled required prepayment or redemption), purchased or
defeased, or any offer to prepay, redeem, purchase or defease such Indebtedness
shall be required to be made, in each case prior to the stated maturity thereof;
or

 

(g)                                 the Borrower or any Subsidiary shall
(i) commence a voluntary case or other proceeding or file any petition seeking
liquidation, reorganization or other relief under any federal, state or foreign
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a custodian, trustee, receiver, liquidator or other
similar official of it or any substantial part of its property, (ii) consent to
the institution of , or fail to contest in a timely and appropriate manner, any
proceeding or petition described in clause (i) of this Section, (iii) apply for
or consent to the appointment of a custodian, trustee, receiver, liquidator or
other similar official for the Borrower or any such Subsidiary or for a
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors, or (vi) take any action for the
purpose of effecting any of the foregoing; or

 

(h)                                 an involuntary proceeding shall be commenced
or an involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of the Borrower or any Subsidiary or
its debts, or any substantial part of its assets,  under any federal, state or
foreign bankruptcy, insolvency or other similar law now or hereafter in effect
or (ii) the appointment of a custodian, trustee, receiver, liquidator or other
similar official for the Borrower or any Subsidiary or for a substantial part of
its assets, and in any such case, such proceeding or petition shall remain
undismissed for a period of 60 days or an order or decree approving or ordering
any of the foregoing shall be entered; or

 

(i)                                     the Borrower or any Subsidiary shall
become unable to pay, shall admit in writing its inability to pay, or shall fail
to pay, its debts as they become due; or

 

(j)                                     an ERISA Event shall have occurred that,
in the opinion of the Lender, when taken together with other ERISA Events that
are outstanding at such time, could reasonably be expected to result in
liability to the Borrower and the Subsidiaries in an aggregate amount exceeding
$5,000,000; or

 

(k)                                  any judgment or order for the payment of
money in excess of $5,000,000 in the aggregate shall be rendered against the
Borrower or any Subsidiary, and either (i) enforcement proceedings shall have
been commenced by any creditor upon such judgment or order or (ii) there shall
be a period of 30 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or

 

(l)                                     any non-monetary judgment or order shall
be rendered against the Borrower or any Subsidiary that would reasonably be
expected to have a Material Adverse Effect, and there shall be a period of
30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or

 

(m)                               a Change in Control shall occur or exist; or

 

(n)                                 any Governmental Authority having regulatory
authority over the Borrower or any Subsidiary shall impose any restriction upon
the payment of dividends from any such Subsidiary to the Borrower; or

 

(o)                                 any Financial Institution Subsidiary shall
cease for any reason to be an insured bank under the Federal Deposit Insurance
Act, as amended; or

 

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(p)                                 the FDIC or any other federal or state
regulatory authority shall issue a cease and desist order or take other action
of a disciplinary or remedial nature against the Borrower or any Financial
Institution Subsidiary and such order or other action would reasonably be
expected to have a Material Adverse Effect or there shall occur with respect to
any Financial Institution Subsidiary any event that is grounds for the required
submission of a capital restoration plan under 12 U. S. C. §1831o (e)(2) and the
regulations thereunder; or

 

(p)                                 the Borrower or any Financial Institution
Subsidiary shall enter into a written agreement with any Governmental Authority
having regulatory authority over such Person that requires the payment of
$5,000,000 or more and/or that imposes a material requirement or limitation on
the operations or business of the Borrower or any such Financial Institution
Subsidiary;

 

then, and in every such event (other than an event with respect to the Borrower
or any Subsidiary described in clause (g) or (h) of this Section) and at any
time thereafter during the continuance of such event, the Lender may, by notice
to the Borrower, take any or all of the following actions, at the same or
different times:  (i) terminate its Revolving Commitment; (ii) declare the
principal of and any accrued interest on the Revolving Loans, and all other
Obligations owing hereunder, to be, whereupon the same shall become due and
payable immediately, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower and (iii) exercise all
remedies contained in any other Loan Document; and that, if an Event of Default
specified in either clause (g) or (h)  shall occur, the Revolving Commitment
shall automatically terminate and the principal of the Revolving Loans then
outstanding, together with accrued interest thereon, and all fees, and all other
Obligations shall automatically become due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower.

 

ARTICLE IX

 

MISCELLANEOUS

 

Section 9.1.  Notices.

 

(a)                                  Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications to any party herein to be effective shall be in writing and
shall be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:

 

To the Borrower:                                                      Greene
County Bancshares, Inc.

100 North Main Street

Greeneville, Tennessee 37743

 

Attn: R. Stan Puckett

Telephone Number: (423) 278-3010

Telecopy Number: (423) 787-1235

 

With a copy
to:                                                                                                            
Bass, Berry & Sims PLC

315 Deadrick Street, Suite 2700

Nashville, Tennessee 37238

 

Attn: Bob F. Thompson

Telephone Number: (615) 742-6262

Telecopy Number: (615) 742-2762

 

To the
Lender:                                                                                                                 
SunTrust Bank

303 Peachtree Street, 3rd Floor

Atlanta, Georgia 30308

 

Attn: Susan M. Thigpen, Director

Telephone Number: (404) 588-7270

Telecopy Number: (404) 581-1775

 

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Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto.  All such
notices and other communications shall, when transmitted by overnight delivery,
or faxed, be effective when delivered for overnight (next-day) delivery, or
transmitted in legible form by facsimile machine, respectively, or if mailed,
upon the third Business Day after the date deposited into the mails or if
delivered, upon delivery; provided, that notices delivered to the Lender shall
not be effective until actually received by the Lender at its address specified
in this Section 9.1.

 

(b)                                 Any agreement of the Lender herein to
receive certain notices by telephone or facsimile is solely for the convenience
and at the request of the Borrower.  The Lender shall be entitled to rely on the
authority of any Person purporting to be a Person authorized by the Borrower to
give such notice and the Lender shall not have any liability to the Borrower or
other Person on account of any action taken or not taken by the Lender in
reliance upon such telephonic or facsimile notice.  The obligation of the
Borrower to repay the Revolving Loans and all other Obligations hereunder shall
not be affected in any way or to any extent by any failure of the Lender to
receive written confirmation of any telephonic or facsimile notice or the
receipt by the Lender of a confirmation which is at variance with the terms
understood by the Lender to be contained in any such telephonic or facsimile
notice.

 

Section 9.2.  Waiver; Amendments.

 

(a)                                  No failure or delay by the Lender in
exercising any right or power hereunder or any other Loan Document, and no
course of dealing between the Borrower and the Lender, shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power or
any abandonment or discontinuance of steps to enforce such right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power hereunder or thereunder.  The rights and remedies of the Lender
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies provided by law. No waiver of any provision
of this Agreement or any other Loan Document or consent to any departure by the
Borrower therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a
Revolving Loan shall not be construed as a waiver of any Default or Event of
Default, regardless of whether the Lender may have had notice or knowledge of
such Default or Event of Default at the time.

 

(b)                                 No amendment or waiver of any provision of
this Agreement or the other Loan Documents, nor consent to any departure by the
Borrower therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Borrower and 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 9.3.  Expenses; Indemnification.

 

(a)                                  The Borrower shall pay (i) all reasonable,
out-of-pocket costs and expenses of the Lender (including, without limitation,
the reasonable fees, charges and disbursements of outside counsel and the
allocated cost of inside counsel) in connection with the preparation and
administration of the Loan Documents and any amendments, modifications or
waivers thereof (whether or not the transactions contemplated in this Agreement
or any other Loan Document shall be consummated), and (ii) all out-of-pocket
costs and expenses (including, without limitation, the reasonable fees, charges
and disbursements of outside counsel and the allocated cost of inside counsel)
incurred by the Lender in connection with the enforcement or protection of its
rights in connection with this Agreement, including its rights under this
Section, or in connection with the Revolving Loans made hereunder, including all
such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Revolving Loans.

 

(b)                                 The Borrower shall indemnify the Lender and
each Affiliate of the Lender, and each officer, director, employee, agents and
advisors of the Lender and each Affiliate of the Lender (each, an “Indemnitee”)
against, and hold each of them harmless from, any and all costs, losses,
liabilities, claims, damages and related expenses, including the reasonable
fees, charges and disbursements of any counsel for any Indemnitee, which may be
incurred by any Indemnitee,  or asserted against any Indemnitee by the Borrower
or any third Person, arising out of, in connection with or as a result of
(i) the execution or delivery of this Agreement, any other Loan

 

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Document or any other agreement or instrument contemplated hereby or thereby,
the performance by the parties hereto or thereto of their respective obligations
hereunder or thereunder or the consummation of any of the transactions
contemplated hereby or thereby, (ii) any Revolving Loan or any actual or
proposed use of the proceeds therefrom, (iii) the pledge of any “Collateral’ as
defined in the Pledge Agreement, (iv) any actual or alleged presence or release
of Hazardous Materials on or from any property owned by the Borrower or any
Subsidiary or any Environmental Liability related in any way to the Borrower or
any Subsidiary or (v) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether brought by the Borrower
or any third Person and whether based on contract, tort, or any other theory and
regardless of whether any Indemnitee is a party thereto; provided,  that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are determined by a
court of competent jurisdiction in a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by the Borrower against an Indemnitee for
material breach of such Indemnitee’s obligations hereunder or under any other
Loan Document, if the Borrower has obtained a final and nonappealable judgment
in its favor on such claim as determined by a court of competent jurisdiction.

 

(c)                                  The Borrower shall pay, and hold the Lender
harmless from and against, any and all present and future stamp, documentary,
and other similar taxes with respect to this Agreement and any other Loan
Documents, any collateral described therein, or any payments due thereunder, and
save the Lender harmless from and against any and all liabilities with respect
to or resulting from any delay or omission to pay such taxes.

 

(d)                                 To the extent permitted by applicable law,
the Borrower shall not assert, and hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to actual or direct damages) arising out of, in
connection with or as a result of, this Agreement or any agreement or instrument
contemplated hereby, the transactions contemplated therein, any Loan or the
Letter of Credit or the use of proceeds thereof.

 

(e)                                  All amounts due under this Section shall be
payable promptly upon written demand.

 

Section 9.4.                                Successors and Assigns.

 

(a)                                  The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Borrower may not assign or transfer any
of its rights hereunder without the prior written consent of the Lender (and any
attempted assignment or transfer by the Borrower without such consent shall be
null and void).

 

(b)                                 The Lender may at any time assign to one or
more assignees all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including all or a portion of its
Revolving Commitment and the Revolving Loans at the time owing to it); provided,
that the Borrower must give its prior written consent (which consent shall not
be unreasonably withheld or delayed) to any assignment, except an assignment to
an Affiliate of the Lender or during the occurrence and continuation of a
Default or an Event of Default. Upon the execution and delivery of an assignment
agreement by the Lender and such assignee and payment by such assignee of an
amount equal to the purchase price agreed between the Lender and such assignee,
such assignee shall become a party to this Agreement and the other Loan
Documents and shall have the rights and obligations of a Lender under this
Agreement, and the Lender shall be released from its obligations hereunder to a
corresponding extent.  Upon the consummation of any such assignment hereunder,
the Lender, the assignee and the Borrower shall make appropriate arrangements to
have new Revolving Credit Notes issued to reflect such assignment.

 

(c)                                  The Lender may at any time, without the
consent of the Borrower, sell participations to one or more banks or other
entities (a “Participant”) in all or a portion of the Lender’s rights and
obligations under this Agreement; provided, that (i) the Lender’s obligations
under this Agreement shall remain unchanged, (ii) the Lender shall remain solely
responsible to the other parties hereto for the performance of its obligations
hereunder, and (iii) the Borrower shall continue to deal solely and directly
with the Lender in connection with the Lender’s rights and obligations under
this Agreement and the other Loan Documents. Any agreement between the Lender
and the Participant with respect to such participation shall provide that the
Lender shall retain the sole right and responsibility to enforce this Agreement
and the other Loan Documents and the right to approve any amendment,
modification or waiver of this Agreement and the other Loan Documents; provided,
that such participation

 

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agreement may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver of this Agreement
described in the first proviso of Section 9.2(b) that affects the Participant. 
The Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.8, 2.9 and 2.10 to the same extent as if it were a Lender hereunder
and had acquired its interest by assignment pursuant to paragraph (b); provided,
that no Participant shall be entitled to receive any greater payment under
Section 2.10 than the Lender would have been entitled to receive with respect to
the participation sold to such Participant unless the sale of such participation
is made with the Borrower’s prior written consent.

 

(d)                                 The Lender may at any time pledge or assign
a security interest in all or any portion of its rights under this Agreement and
the Revolving Credit Note to secure its obligations to a Federal Reserve Bank
without complying with this Section; provided, that no such pledge or assignment
shall release the Lender from any of its obligations hereunder or substitute any
such pledgee or assignee for such Lender as a party hereto.

 

Section 9.5.                                Governing Law; Jurisdiction; Consent
to Service of Process.

 

(a)                                  This Agreement and the other Loan Documents
shall be construed in accordance with and be governed by the law (without giving
effect to the conflict of law principles thereof) of the State of Georgia.

 

(b)                                 The Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the non-exclusive
jurisdiction of any Federal and/or state court located in the State of Georgia
and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement or any other Loan Document or the
transactions contemplated hereby or thereby, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such Georgia state court or, to the
extent permitted by applicable law, such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement or any other Loan
Document shall affect any right that the Lender may otherwise have to bring any
action or proceeding relating to this Agreement or any other Loan Document
against the Borrower or its properties in the courts of any jurisdiction.

 

(c)                                  The Borrower irrevocably and
unconditionally waives any objection which it may now or hereafter have to the
laying of venue of any such suit, action or proceeding described in paragraph
(b) of this Section and brought in any court referred to in paragraph (b) of
this Section. Each of the parties hereto irrevocably waives, to the fullest
extent permitted by applicable law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

 

(d)                                 Each party to this Agreement irrevocably
consents to the service of process in the manner provided for notices in
Section 9.1.  Nothing in this Agreement or in any other Loan Document will
affect the right of any party hereto to serve process in any other manner
permitted by law.

 

Section 9.6.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).

 

Section 9.7.   Right of Setoff.  In addition to any rights now or hereafter
granted under applicable law and not by way of limitation of any such rights,
the Lender shall have the right, at any time or from time to time upon the
occurrence and during the continuance of an Event of Default, without prior
notice to the Borrower, any such notice being expressly waived by the Borrower
to the extent permitted by applicable law, to set off and apply against all
deposits (general or special, time or demand, provisional or final) of the
Borrower at any time held or other obligations at any time owing by the Lender
to or for the credit or the account of the Borrower against any and all
Obligations held by the Lender, irrespective of whether the Lender shall have
made demand hereunder and although such Obligations may be unmatured.  The
Lender agrees promptly to notify the Borrower after any such set-off and any
application made by the Lender; provided, that the failure to give such notice
shall not affect the validity of such set-off and application.

 

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Section 9.8.   Counterparts; Integration.  This Agreement may be executed by one
or more of the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. This Agreement, the other Loan
Documents, and any separate letter agreement(s) relating to any fees payable to
the Lender constitute the entire agreement among the parties hereto and thereto
regarding the subject matters hereof and thereof and supersede all prior
agreements and understandings, oral or written, regarding such subject matters.

 

Section 9.9.  Survival. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Revolving Loans, regardless of any investigation made by any such other party or
on its behalf and notwithstanding that the Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended hereunder, and shall continue in full force and effect as
long as the principal of or any accrued interest on any Revolving Loan or any
fee or any other amount payable under this Agreement is outstanding and unpaid
and so long as the Revolving Commitment has not expired or terminated.  The
provisions of Sections 2.10 and 9.3 shall survive and remain in full force and
effect regardless of the consummation of the transactions contemplated hereby,
the repayment of the Revolving Loans, the expiration or termination of the
Revolving Commitment or the termination of this Agreement or any provision
hereof.  All representations and warranties made herein, in the certificates,
reports, notices, and other documents delivered pursuant to this Agreement shall
survive the execution and delivery of this Agreement and the other Loan
Documents, and the making of the Revolving Loans.

 

Section 9.10.  Severability.  Any provision of this Agreement or any other Loan
Document held to be illegal, invalid or unenforceable in any jurisdiction,
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity or unenforceability without affecting the legality, validity or
enforceability of the remaining provisions hereof or thereof; and the
illegality, invalidity or unenforceability of a particular provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.

 

Section 9.11.  Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Revolving Loan,
together with all fees, charges and other amounts which may be treated as
interest on such Revolving Loan under applicable law (collectively, the
“Charges”), shall exceed the maximum lawful rate of interest (the “Maximum
Rate”) which may be contracted for, charged, taken, received or reserved by the
Lender in accordance with applicable law, the rate of interest payable in
respect of such Loan hereunder, together with all Charges payable in respect
thereof, shall be limited to the Maximum Rate and, to the extent lawful, the
interest and Charges that would have been payable in respect of such Revolving
Loan but were not payable as a result of the operation of this Section shall be
cumulated and the interest and Charges payable to the Lender in respect of other
Revolving Loans or periods shall be increased (but not above the Maximum Rate
therefor) until such cumulated amount, together with interest thereon at the
Federal Funds Rate to the date of repayment, shall have been received by the
Lender.

 

[Remainder of Page Intentionally Left Blank]

 

28

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed under seal in the case of the Borrower by their respective authorized
officers as of the day and year first above written.

 

 

 

GREENE COUNTY BANCSHARES, INC.

 

 

 

 

 

 

By

/s/ Stan Puckett

 

 

 

 

Name: Stan Puckett

 

 

 

Title: Chairman of the Board and Chief Executive Officer

 

 

 

 

 

 

 

 

 

[SEAL]

 

 

 

 

 

 

SUNTRUST BANK

 

 

 

 

 

 

 

 

 

 

By

/s/ Susan M. Thigpen

 

 

 

 

Name: Susan M. Thigpen

 

 

 

Title: Director

 

29

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SCHEDULE  4.12

 

FINANCIAL INSTITUTION SUBSIDIARIES

 

 

 

OWNERSHIP% BY

 

JURISDICTION OF

 

Name

 

Borrower

 

Incorporation

 

 

 

 

 

 

 

Greene County Bank

 

 

100%

 

Tennessee

 

 

OTHER SUBSIDIARIES

 

Fairway Title Company

 

 

100%

 

Tennessee

 

 

 

 

 

 

 

 

GCB Acceptance Corporation

 

 

100%

 

Tennessee

 

 

 

 

 

 

 

 

Superior Financial Services, Inc.

 

 

100%

 

Tennessee

 

 

 

 

 

 

 

 

Greene County Capital Trust I

 

 

100% of common securities

 

Delaware

 

 

 

 

 

 

 

 

Greene County Capital Trust II

 

 

100% of common securities

 

Delaware

 

 

1

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SCHEDULE 7.1

 

OUTSTANDING INDEBTEDNESS

 

1. $1,800,000 term loan from SunTrust Bank due on October 31, 2006

 

1

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EXHIBIT A

 

REVOLVING CREDIT NOTE

 

$35,000,000.00

 

Atlanta, Georgia

 

 

 

August    , 2005

 

FOR VALUE RECEIVED, the undersigned, GREENE COUNTY BANCSHARES, INC.,  a
Tennessee corporation (the “Borrower”), hereby promises to pay to SunTrust Bank
(the “Lender”) or its registered assigns at its principal office or any other
office that the Lender designates, on the Commitment Termination Date (as
defined in the Revolving Credit Agreement dated as of August    , 2005 (as the
same may be amended, supplemented or otherwise modified from time to time, the
“Credit Agreement”), between the Borrower and the Lender, the lesser of the
principal sum of Thirty Five Million and no/100 Dollars ($35,000,000), which
amount shall automatically reduce to Fifteen Million and no/100 Dollars
($15,000,000) on November 30, 2005 in accordance with the terms of the Credit
Agreement, and the aggregate unpaid principal amount of all Revolving Loans made
by the Lender to the Borrower pursuant to the Credit Agreement, in lawful money
of the United States of America in immediately available funds, and to pay
interest from the date hereof on the principal amount thereof from time to time
outstanding, in like funds, at said office, at the rate or rates per annum and
payable on such dates as provided in the Credit Agreement.  In addition, should
legal action or an attorney-at-law be utilized to collect any amount due
hereunder, the Borrower further promises to pay all costs of collection,
including the reasonable attorneys’ fees of the Lender.

 

The Borrower promises to pay interest, on demand, on any overdue principal and,
to the extent permitted by law, overdue interest from their due dates at a rate
or rates provided in the Credit Agreement.

 

All borrowings evidenced by this Revolving Credit Note and all payments and
prepayments of the principal hereof and the date thereof shall be endorsed by
the holder hereof on the schedule attached hereto and made a part hereof or on a
continuation thereof which shall be attached hereto and made a part hereof, or
otherwise recorded by such holder in its internal records; provided, that the
failure of the holder hereof to make such a notation or any error in such
notation shall not affect the obligations of the Borrower to make the payments
of principal and interest in accordance with the terms of this Revolving Credit
Note and the Credit Agreement.

 

This Revolving Credit Note is issued in connection with, and is entitled to the
benefits of, the Credit Agreement which, among other things, contains provisions
for the acceleration of the maturity hereof upon the happening of certain
events, for prepayment of the principal hereof prior to the maturity hereof and
for the amendment or waiver of certain provisions of the Credit Agreement, all
upon the terms and conditions therein specified.  THIS REVOLVING CREDIT NOTE
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF
GEORGIA AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.

 

 

GREENE COUNTY BANCSHARES, INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

[SEAL]

 

A-1

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LOANS AND PAYMENTS

 

Date

 

Amount and
Type of Loan

 

Payments of
Principal

 

Unpaid
Principal
Balance of
Note

 

Name of Person
Making
Notation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A-2

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EXHIBIT 2.2

 

SunTrust Bank

303 Peachtree Street, 3rd Floor

Atlanta, Georgia 30308

 

Attention:

 

Dear Sirs:

 

Reference is made to the Revolving Credit Agreement dated as of August    , 2005
(as amended and in effect on the date hereof, the “Credit Agreement”), between
the undersigned, as Borrower, and SunTrust Bank, as Lender.  Terms defined in
the Credit Agreement are used herein with the same meanings.  This notice
constitutes a Notice of Borrowing, and the Borrower hereby requests a Revolving
Loan under the Credit Agreement, and in that connection the Borrower specifies
the following information with respect to the Revolving Loan requested hereby:

 

(A)                              Principal amount of Revolving Loan:

 

(B)                                Date of Revolving Loan (which is a Business
Day):

 

(C)                                Purpose (if larger than $2,500,000):

 

(D)                               Location and number of Borrower’s account to
which proceeds of Revolving Loan are to be disbursed:

 

The Borrower hereby represents and warrants that the conditions specified in
paragraphs (a), (b) and (c) of Section 3.2 of the Credit Agreement are
satisfied.

 

 

Very truly yours,

 

 

 

GREENE COUNTY BANCSHARES, INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

1

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