Exhibit 4.1


 


ATLANTIC SOUTHERN
FINANCIAL GROUP, INC.


 


Form of Atlantic Southern Bank Fixed Rate
Subordinated Debenture


 


THIS NOTE
IS NOT A DEPOSIT AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY GOVERNMENT AGENCY, AND IS NOT SECURED


 


THIS NOTE
HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933 OR ANY STATE OR
OTHER JURISDICTION’S SECURITIES OR BLUE SKY LAWS.  NO SUCH SECURITIES NOR ANY INTEREST THEREIN
SHALL BE SOLD, PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED OR
DISPOSED OF ABSENT SUCH REGISTRATION, OR RECEIPT OF AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE BORROWER, SUCH REGISTRATION IS NOT REQUIRED.


 


	
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ATLANTIC SOUTHERN
BANK


Fixed Rate
Subordinated Note due September 30, 2018


 


1.        Payment.


 


(a)       ATLANTIC SOUTHERN BANK, a Georgia
state-chartered bank (the “Issuer”), for value received, hereby promises
to pay to
                                      ,
or its registered assigns, the principal sum of
                                          
Dollars (U.S.)
($                          )
on September 30, 2018 (the “Maturity Date”) and to pay interest
thereon from September 30, 2008, or from the most recent Interest Payment
Date (as defined below) to which interest has been paid or duly provided for,
semi-annually in arrears on June 30 and December 31 of each year
(each, an “Interest Payment Date”), commencing on the Interest Payment
Date in December 2008, at an annual rate equal to 12% (the “Interest
Rate”) will be applied to the principal amount hereof, until the principal
hereof is paid or duly provided for or made available for payment, and on any
overdue principal and (without duplication and to the extent that payment of
such interest is enforceable under applicable law) on any overdue installment
of interest at the Interest Rate in effect for each applicable period,
compounded semi-annually, from the dates such amounts are due until they are
paid or made available for payment.  The
amount of interest payable for any period will be computed on the basis of the
actual number of days in the Distribution Period concerned divided by 360.


 


On or before December 31, 2008, the Issuer may,
in its sole discretion and without consent of the Noteholders (as defined
below), increase retroactive to September 30, 2008 the Interest Rate to be
paid on the Notes (as defined below) to an annual rate not to exceed 12.5% by
sending notice to the holder in whose name this Note is registered on the
Security Register as of the date of such increase.  In no event may the Issuer decrease the
Interest Rate without the consent of Noteholders as required by Section 16
hereof.


 


(b)      Any payment of
principal of or interest on this Note that would otherwise become due and payable
on a day which is not a Business Day shall become due and payable on the next
succeeding Business Day, with the same force and effect as if made on the date
for payment of such principal or interest, and no interest shall accrue in
respect of such payment for the period after such day.  The term “Business Day” means any day
that is not a Saturday or Sunday and that is not a day on which banks in the
Cities of New York, New York and Wilmington, Delaware or the State of Georgia
are generally authorized or required by law or executive order to be closed.


 


2.        Notes, Noteholders, Fiscal and Paying
Agency Agreement.  This Note is one
of a duly authorized issue of notes of the Issuer designated as Fixed Rate
Notes due September 30, 2018 (herein called the “Notes”), initially
limited in aggregate principal amount to $10,000,000.  The Issuer intends to act as its own paying
agent;


 

















 


ATLANTIC SOUTHERN FINANCIAL GROUP, INC.


 


Form of Atlantic Southern
Bank Fixed Rate Subordinated Debenture


 


however, the Bank may, for the
benefit of the holders of the Notes (collectively, the “Noteholders”),
enter into a Fiscal and Paying Agency Agreement (the “Fiscal and Paying
Agency Agreement”) between the Issuer and a Fiscal and Paying Agent.  In the event the Issuer enters into a Fiscal
and Paying Agency Agreement, Issuer shall provide notice to the registered
holder of the Notes within 60 day of entering into such agreement, and copies
of such Fiscal and Paying Agency Agreement shall be kept on file and available
for inspection during normal business hours at the offices of the Fiscal and
Paying Agent, or at such other place or places as the Fiscal and Paying Agent
shall designate by notice to the holder in whose name this Note is registered
on the Security Register (as defined in Section 10 of this Note).  Such Fiscal and Paying Agency Agreement may
provide for further rights of the Noteholders and the further rights,
limitations of rights, duties and indemnities thereunder of the Issuer and the
Fiscal and Paying Agent and of the terms upon which the Notes are, and are to
be, authenticated and delivered.


 


3.        Optional Redemption.  Beginning on September 30, 2013, the
Issuer may, at its option and subject to obtaining prior approval of the
Federal Deposit Insurance Corporation (the “FDIC”), redeem some or all
of the Notes on any Interest Payment Date at a redemption price of 100% of the
principal amount of the redeemed Notes, plus any accrued but unpaid interest.


 


The
Issuer will notify the registered holders of the Notes to be redeemed at least
30 but not more than 60 days before the Issuer redeems the Notes.  If the Issuer redeems only some of the Notes,
it will select the Notes to be redeemed on principal amounts of $100,000 or any
amount in excess thereof which is an integral multiple of $1,000 by lot, pro rata or by another method the Issuer considers fair and
appropriate.  All Notes that remain
outstanding after any partial redemption must have a principal amount of
$100,000 or any amount in excess thereof which is an integral multiple of
$1,000.


 


The Notes, which have
been called for redemption, shall cease to be outstanding from and after the
redemption date.


 


4.        Subordination.  The indebtedness of the Issuer evidenced by
the Notes, including the principal and interest on this Note, shall be
subordinate and junior in right of payment to the Issuer’s obligations to its
depositors, its obligations under bankers’ acceptances and letters of credit,
and its other obligations to its general and secured creditors, including, but
not limited to, its obligations to the Federal Reserve Bank of Atlanta, the
FDIC and any rights acquired by the FDIC as a result of loans made by the FDIC
to the Issuer or the purchase or guarantee of any of its assets by the FDIC,
pursuant to the provisions of 12 U.S.C. 1823 (c), (d) or (e) whether
now outstanding or hereafter incurred (except any other obligations which rank
on a parity with or subordinate to the Notes). 
In the event of any insolvency, receivership, conservatorship,
reorganization, readjustment of debt, marshalling of assets and liabilities or
similar proceedings or any liquidation or winding up of or relating to the
Issuer, whether voluntary or involuntary, all obligations of the Issuer (except
any other obligations which rank on a parity with or subordinate to the Notes)
shall be entitled to be paid in full before any payment shall be made on
account of the principal of or interest on the Notes, including this Note.  In the event of any such proceeding, after
payment in full of all sums owing with respect to such prior obligations, the
Noteholders, together with the holders of any obligations of the Issuer ranking
on a parity with the Notes, shall be entitled to be paid from the remaining
assets of the Issuer the unpaid principal thereof, and the unpaid interest
thereon, before any payment or other distribution, whether in cash, property or
otherwise, shall be made on account of any capital stock or any obligations of
the Issuer ranking junior to the Notes.


 


Nothing
herein shall impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of and interest on this Note in accordance
with its terms.


 


5.        Consolidation, Merger and Sale of
Assets.  The Issuer shall not
consolidate with or merge into another entity or convey, transfer or lease its
properties and assets substantially as an entirety to any person, unless:


 


(a)       the continuing
entity formed by such consolidation or into which the Issuer is merged or the
person which acquires by conveyance or transfer or which leases the properties
and assets of the Issuer substantially as an entirety shall be a corporation,
association or general partnership or other legal entity organized and existing
under


 

















 


ATLANTIC SOUTHERN FINANCIAL GROUP, INC.


 


Form of Atlantic Southern
Bank Fixed Rate Subordinated Debenture


 


the laws of the United States of America, any State thereof
or the District of Columbia, shall expressly assume, by a supplemental
agreement executed and delivered to the Issuer in a satisfactory form, the due
and punctual payment of the principal of and any premium and interest on the
Notes, according to their terms, and the due and punctual performance of all
covenants and conditions hereof on the part of the Issuer to be performed or
observed; and


 


(b)      immediately
after giving effect to such transaction, no Event of Default (as defined
below), and no event which, after notice or lapse of time or both, would become
an Event of Default, shall have happened and be continuing.


 


6.        Events of Default; Acceleration; Compliance
Certificate.  If any of the following
events shall occur and be continuing it shall constitute an event of default
(each an “Event of Default”):


 


(a)       the Issuer shall consent to the
appointment of a receiver, liquidator, trustee or other similar official in any
liquidation, insolvency or similar proceeding with respect to the Issuer or all
or substantially all of its property; or


 


(b)      a court or
other governmental agency or body having jurisdiction on the premises shall
enter a decree or order for the appointment of a receiver, liquidator, trustee
or other similar official in any liquidation, insolvency or similar proceeding
with respect to the Issuer or all or substantially all of the property of the
Issuer, or for the winding up of the affairs or business of the Issuer and such
decree or order shall have remained in force for 60 days; then, and in each
such case, unless the principal of this Note already shall have become due and
payable, the holder of this Note, by notice in writing to the Issuer, may
declare the principal amount of this Note to be due and payable immediately
and, upon any such declaration the same shall become and shall be immediately
due and payable.  The Issuer may waive demand, presentment for payment, notice of
nonpayment, notice of protest, and all other notices.


 


The
Issuer, promptly after the receipt of written notice from the source of the
occurrence of an Event of Default with respect to this Note, shall mail to all
Noteholders, at their addresses shown on the Security Register, such written
notice of the Event of Default, unless such Event of Default shall have been
cured or waived before the giving of such notice.  Prior to any acceleration of this Note, the
Noteholders holding 66 2/3% in aggregate principal amount of the outstanding
Notes may waive any past Event of Default. 
In addition, the Noteholders holding 66 2/3% in aggregate principal
amount of the outstanding Notes may rescind a declaration of acceleration of
this Note before any judgment has been obtained if (i) the Issuer pays all
matured installments of principal of and interest on this Note (other than
installments due by reason of acceleration) and interest on the overdue
installments and (ii) all other Events of Default with respect to this
Note have been cured or waived.


 


THIS
NOTE MAY NOT BE REPAID PRIOR TO THE MATURITY DATE, WHETHER PURSUANT TO AN
ACCELERATION UPON AN EVENT OF DEFAULT OR OTHERWISE, WITHOUT THE PRIOR WRITTEN
APPROVAL OF THE FDIC.


 


7.        Failure to Make Payment.  In the event of failure by the Issuer to make
any payment of principal of or interest on this Note (and, in the case of
payment of interest, such failure to pay shall have continued for 30 days), the
Issuer will, upon demand of the holder, pay to the holder the whole amount then
due and payable on this Note for principal and interest (without acceleration),
with interest on the overdue principal and interest at the rate borne by this
Note, to the extent permitted by applicable law.  If the Issuer fails to pay such amount upon
such demand, the holder may, among other things, institute a judicial
proceeding for the collection of the sums so due and unpaid, may prosecute such
proceeding to judgment or final decree and may enforce the same against the
Issuer and collect the amounts adjudged or decreed to be payable in the manner
provided by law out of the property of the Issuer.


 


8.        Payment Procedures.  Payment of the principal and interest payable
on the Maturity Date will be made by check or wire transfer in immediately
available funds to a bank account in the United States designated by the holder
of this Note, upon presentation and surrender of this Note at the main office
of the Issuer in Macon, Georgia, or at such other place or places as the Issuer
shall designate by notice to the Noteholders, provided that this


 

















 


ATLANTIC SOUTHERN FINANCIAL GROUP, INC.


 


Form of Atlantic Southern
Bank Fixed Rate Subordinated Debenture


 


Note is presented to the Issuer
in time for it to make such payments in such funds in accordance with its
normal procedures.  Payments of interest
(other than interest payable on the Maturity Date) shall be made by wire
transfer or by check mailed to the person entitled thereto, as such person’s
address appears on the Security Register. 
Interest payable on any Interest Payment Date shall be payable to the
holder in whose name this Note is registered at the close of business on the 15th
of the month next in which the relevant Interest Payment Date is scheduled to
fall, whether or not a Business Day (such date being referred to herein as the “Regular
Record Date”), except that interest not so punctually paid will be paid to
the holder in whose name this Note is registered at the close of business on a
special record date fixed by the Issuer (a “Special Record Date”),
notice of which shall be given to the holder not less than ten calendar days
prior to such Special Record Date (the Regular Record Date and Special Record
Date are referred to herein collectively as the “Record Dates”).  To the extent permitted by applicable law, interest
shall accrue at the Interest Rate on any amount of principal of or interest on
this Note not paid when due.  All
payments on this Note shall be applied first to accrued interest and then the
balance, if any, to principal.


 


9.        Form of Payment, Maintenance of
Payment Office.  Payments of
principal of and interest on this Note shall be made in such coin or currency
of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts. 
Until the date on which all of the Notes shall have been surrendered or
delivered to the Issuer for cancellation or destruction, or become due and
payable and a sum sufficient to pay the principal of and interest on all of the
Notes have been paid or returned to the Issuer as provided herein.  The Issuer shall at all times maintain an
office or agency in the City of Macon, Georgia where Notes may be presented or
surrendered for payment.


 


10.      Registration of Transfer, Security
Register.  Except as otherwise
provided on the first page hereof, this Note is transferable in whole or
in part, and may be exchanged for a like aggregate principal amount of Notes of
other authorized denominations, by the holder in person, or by his attorney
duly authorized in writing, at the office of the Issuer in the City of Macon,
Georgia.  The Issuer shall maintain a
register providing for the registration of the Notes and any exchange or
transfer thereof (the “Security Register”).  Upon surrender or presentation of this Note
for exchange or registration of transfer, the Issuer shall execute and shall
authenticate and deliver in exchange therefor a Note or Notes of like aggregate
principal amount, each in a denomination of $100,000 or any amount in excess
thereof which is an integral multiple of $1,000 (and, in the absence of an
opinion of counsel satisfactory to the Issuer to the contrary, bearing the
restrictive legend(s) called for by the Offering Memorandum), and that is
or are registered in such name or names requested by the holder.  Any Note presented or surrendered for
registration of transfer or for exchange shall (if so required by the Issuer)
be duly endorsed, or accompanied by a written instrument of transfer in
satisfactory form with such evidence of due authorization and guarantee of
signature as may reasonably be required by the Issuer, duly executed by the
holder or his attorney duly authorized in writing, with such tax identification
number or other information for each person in whose name a Note is to be
issued, and accompanied by evidence of compliance with any restrictive legend(s) appearing
on such Note or Notes as the Issuer may reasonably request to comply with
applicable law.  No exchange or
registration of transfer of this Note shall be made on or after the fifteenth
day immediately preceding the Maturity Date.


 


11.      Charges and Transfer Taxes.  No service charge, excluding any cost of
delivery, shall be imposed for any exchange or registration of transfer of this
Note, but the Issuer may require the payment of a sum sufficient to cover any
stamp or other tax or governmental charge that may be imposed in connection
therewith (or presentation of evidence that such tax or charge has been paid).


 


12.      Ownership.  Prior to due presentment of this Note for
registration of transfer, the Issuer may treat the holder in whose name this
Note is registered in the Security Register as the absolute owner of this Note
for the purpose of receiving payments of principal of and interest on this Note
and for all other purposes whatsoever, whether or not this Note be overdue, and
the Issuer shall not be affected by any notice to the contrary.


 


13.      Priority.  The Notes rank pari passu
among themselves and pari passu, in
the event of any insolvency proceeding, receivership, conservatorship, reorganization,
readjustment of debt, marshalling of assets and liabilities or similar
proceeding or any liquidation or winding up of the Issuer, with all other
present or future


 

















 


ATLANTIC SOUTHERN FINANCIAL GROUP, INC.


 


Form of Atlantic Southern
Bank Fixed Rate Subordinated Debenture


 


unsecured subordinated debt
obligations of the Issuer, except any unsecured subordinated debt which may be
expressly stated to be senior to or subordinate to the Notes.


 


14.      Notices.  All notices to the Issuer under this Note
shall be in writing and addressed to the Issuer at 1701 Bass Road, Macon,
Georgia 31210, Attention:  Chief
Financial Officer, or to such other address as the Issuer may notify to the
holder.  All notices to the Noteholders
shall be in writing and sent by first-class mail to each Noteholder at his or
its address as set forth in the Security Register.


 


15.      Denominations.  The Notes are issuable only as fully
registered Notes without interest coupons in denominations of $100,000 or any
amount in excess thereof which is a whole multiple of $1,000.


 


16.      Modification.  Except as set forth in Section 1 hereof,
the Issuer may not amend or modify the rights and obligations of the Issuer and
the rights of the holders without the consent of the Noteholders holding
66 2/3% in aggregate principal amount of the Notes at the time
outstanding.  If there is an Event of
Default, Noteholders holding 66 2/3% in aggregate principal amount of the Notes
at the time outstanding, on behalf of all Noteholders, may waive Issuer
compliance.  The Issuer shall not enter
into any agreement for the purpose of changing the Maturity Date or the terms
of subordination of any Note unless the FDIC has consented to such agreement.


 


17.      Absolute and Unconditional Obligation
of the Issuer.  No provisions of this
Note shall alter or impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of and interest on this Note at the times,
places and rate, and in the coin or currency, herein prescribed.


 


18.      Waiver and Consent.  (a) Any consent or waiver given by the
holder of this Note shall be conclusive and binding upon such holder and upon
all future holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Note.


 


(b)      No delay or omission of the holder to
exercise any right or remedy accruing upon any Event of Default shall impair
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein.


 


(c)       Any insured depository institution which
shall be a holder of this Note or which otherwise shall have any beneficial
ownership interest in this Note shall, by its acceptance of such Note (or
beneficial interest therein), be deemed to have waived any right of offset with
respect to the indebtedness evidenced thereby.


 


20.      Loans by Issuer.  This Note is ineligible as collateral for a
loan by the Issuer.


 


21.      Further Issues.  The Issuer may, without the consent of the
holders of the Notes, create and issue additional notes having the same terms
and conditions of the Notes (except for the issue date and issue price) .  Such further notes shall be consolidated and
form a single series with the Notes.  Any
such issuance shall be made pursuant to another offering document and will
either be registered or issued pursuant to an exemption from registration under
the Securities Act of 1933, as amended, or similar laws or regulations issued
by the applicable banking agency.


 


22.      Governing Law.  This Note shall be governed by and construed
in accordance with applicable federal law and the laws of the State of Georgia.


 

















 


ATLANTIC SOUTHERN FINANCIAL GROUP, INC.


 


Form of Atlantic Southern
Bank Fixed Rate Subordinated Debenture


 


IN
WITNESS WHEREOF, the undersigned has caused this Note to be duly executed and
its corporate seal to be hereunto affixed and attested.


 


	
   

  	
   

  	
  ATLANTIC SOUTHERN BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  (Corporate Seal)