Exhibit 10.1


EXECUTION VERSION


 





 








 


TERM LOAN AGREEMENT


 


dated as of April 26, 2013


 


among


 


BNC BANCORP,


as Borrower


 


and


 


SYNOVUS BANK,


as Lender


 


 








 




    	 



    	 



    

 


TABLE OF CONTENTS





 


	 	 	 	Page
	 	 	 	 
	Article I	 	DEFINITIONS; CONSTRUCTION	1
	 	 	 	 
	Section 1.1.	 	Definitions	1
	Section 1.2.	 	Accounting Terms and Determination	18
	Section 1.3.	 	Terms Generally	18
	 	 	 	 
	Article II	 	AMOUNT AND TERMS OF THE TERM LOAN	19
	 	 	 	 
	Section 2.1.	 	Term Loan Commitment	19
	Section 2.2.	 	Procedure for Borrowing Term Loan	19
	Section 2.3.	 	Funding of Borrowing	19
	Section 2.4.	 	Interest Elections.	19
	Section 2.5.	 	Repayment and Prepayments of Term Loan.	20
	Section 2.6.	 	Interest on Term Loan.	23
	Section 2.7.	 	Fees	23
	Section 2.8.	 	Computation of Interest and Fees	23
	Section 2.9.	 	Inability to Determine Interest Rates	24
	Section 2.10.	 	Evidence of Indebtedness	24
	Section 2.11.	 	Illegality	24
	Section 2.12.	 	Increased Costs.	24
	Section 2.13.	 	Funding Indemnity	25
	Section 2.14.	 	Taxes.	26
	Section 2.15.	 	Payments Generally.	26
	 	 	 	 
	Article III	 	CONDITIONS PRECEDENT TO EFFECTIVENESS AND BORROWING	27
	 	 	 	 
	Section 3.1.	 	Conditions To Effectiveness and Borrowing	27
	 	 	 	 
	Article IV	 	REPRESENTATIONS AND WARRANTIES	29
	 	 	 	 
	Section 4.1.	 	Existence; Power	29
	Section 4.2.	 	Organizational Power; Authorization	29
	Section 4.3.	 	Governmental Approvals; No Conflicts	30
	Section 4.4.	 	Financial Statements	30
	Section 4.5.	 	Litigation Matters and Enforcement Actions	30
	Section 4.6.	 	Compliance with Laws and Agreements	31
	Section 4.7.	 	Investment Company Act	31
	Section 4.8.	 	Taxes	31
	Section 4.9.	 	Margin Regulations	31
	Section 4.10.	 	ERISA	31
	Section 4.11.	 	Disclosure	32
	Section 4.12.	 	Subsidiaries	32
	Section 4.13.	 	Dividend Restrictions; Other Restrictions	33


 




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	Section 4.14.	 	Capital Measures	33
	Section 4.15.	 	Ownership of Property	33
	Section 4.16.	 	Patriot Act	34
	Section 4.17.	 	Solvency	34
	Section 4.18.	 	Labor Relations	34
	Section 4.19.	 	Regulatory Matters	34
	Section 4.20.	 	SEC Reports	35
	Section 4.21.	 	Accounting Controls and Disclosure Controls	35
	Section 4.22.	 	Foreign Corrupt Practices Act	36
	Section 4.23.	 	Money Laundering Laws	36
	Section 4.24.	 	OFAC	37
	 	 	 	 
	Article V	 	AFFIRMATIVE COVENANTS	37
	 	 	 	 
	Section 5.1.	 	Financial Statements and Other Information	37
	Section 5.2.	 	Notices of Material Events	40
	Section 5.3.	 	Existence; Conduct of Business	40
	Section 5.4.	 	Compliance with Laws, Etc	41
	Section 5.5.	 	Payment of Obligations	41
	Section 5.6.	 	Books and Records	41
	Section 5.7.	 	Visitation, Inspection, Etc	41
	Section 5.8.	 	Maintenance of Properties; Insurance	41
	Section 5.9.	 	Use of Proceeds	42
	Section 5.10.	 	Further Assurances	42
	 	 	 	 
	Article VI	 	FINANCIAL COVENANTS	42
	 	 	 	 
	Section 6.1.	 	Regulatory Capital	42
	 	 	 	 
	Article VII	 	NEGATIVE COVENANTS	43
	 	 	 	 
	Section 7.1.	 	Indebtedness	43
	Section 7.2.	 	Negative Pledge	44
	Section 7.3.	 	Fundamental Changes	45
	Section 7.4.	 	Restricted Payments	45
	Section 7.5.	 	Restrictive Agreements	46
	Section 7.6.	 	Investments, Etc	46
	Section 7.7.	 	Transactions with Affiliates	47
	Section 7.8.	 	Hedging Transactions	47
	Section 7.9.	 	Amendment to Material Documents	47
	Section 7.10.	 	Sale and Leaseback Transaction	47
	Section 7.11.	 	Accounting Changes	47
	Section 7.12.	 	Unsafe and Unsound Practices	48
	Section 7.13.	 	Most Favored Lender Status	48
	 	 	 	 
	Article VIII	 	EVENTS OF DEFAULT	48
	 	 	 	 
	Section 8.1.	 	Events of Default	48


 




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	Article IX	 	MISCELLANEOUS	51
	 	 	 	 
	Section 9.1.	 	Notices.	51
	Section 9.2.	 	Waiver; Amendments.	53
	Section 9.3.	 	Expenses; Indemnification.	54
	Section 9.4.	 	Successors and Assigns.	55
	Section 9.5.	 	Governing Law; Jurisdiction; Consent to Service of Process.	56
	Section 9.6.	 	WAIVER OF JURY TRIAL	57
	Section 9.7.	 	Right of Setoff	57
	Section 9.8.	 	Counterparts; Integration	58
	Section 9.9.	 	Survival	58
	Section 9.10.	 	Severability	58
	Section 9.11.	 	Confidentiality	59
	Section 9.12.	 	Waiver of Effect of Corporate Seal	59
	Section 9.13.	 	Patriot Act	59
	Section 9.14.	 	Independence of Covenants	59
	Section 9.15.	 	No Advisory or Fiduciary Relationship	60


 






Schedules


 


	Schedule 4.12	-	Subsidiaries
	Schedule 7.1	-	Outstanding Indebtedness
	Schedule 7.6	-	Investments


 


Exhibits


 


	Exhibit A	-	Form of Assignment and Acceptance Agreement
	Exhibit B	-	Form of Term Note
	Exhibit 2.2	-	Form of Notice of Borrowing
	Exhibit 2.4	-	Form of Notice of Continuation/Conversion
	Exhibit 3.1(b)(iii)	-	Form of Secretary’s Certificate
	Exhibit 3.1(b)(vi)	-	Form of Officer’s Certificate
	Exhibit 5.1(c)	-	Form of Compliance Certificate


 




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TERM LOAN AGREEMENT


 


THIS TERM LOAN AGREEMENT (this “Agreement”)
is made and entered into as of April 26, 2013, by and among BNC BANCORP, a North Carolina corporation (the “Borrower”),
and SYNOVUS BANK, as Lender (the “Lender”).


 


WITNESSETH:


 


WHEREAS, the Borrower
has requested that the Lender, and the Lender has agreed subject to the terms and conditions of this Agreement to, establish a
term loan facility in an aggregate initial principal amount of $30,000,000;


 


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 interests 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).


 


“Additional
Covenant” shall mean any affirmative or negative covenant or similar restriction applicable to the Borrower or any
of its Subsidiaries (regardless of whether such provision is labeled or otherwise characterized as a covenant) the subject matter
of which either (i) is similar to that of any covenant in Articles V, VI or VII of this Agreement, or related
definitions in Section 1.1 of this Agreement, but contains one or more percentages, amounts or formulas that is more restrictive
than those set forth herein or more beneficial to the holder or holders of the Indebtedness of the Borrower or its Subsidiaries
created or evidenced by the document in which such covenant or similar restriction is contained (and such covenant or similar
restriction shall be deemed an Additional Covenant only to the extent that it is more restrictive or more beneficial) or (ii)
is different from the subject matter of any covenant in Articles V, VI or VII of this Agreement, or related
definitions in Section 1.1 of this Agreement. 


 




    	 



    	 



    

 


“Additional
Default” shall mean any provision contained in any document or instrument creating or evidencing Indebtedness of
the Borrower or any of its Subsidiaries which permits the holder or holders of such Indebtedness to accelerate (with the passage
of time or giving of notice or both) the maturity thereof or otherwise requires the Borrower or any of its Subsidiaries to purchase
such Indebtedness prior to the stated maturity thereof and which either (i) is similar to any Default or Event of Default contained
in Article VIII of this Agreement, or related definitions in Section 1.1 of this Agreement, but contains one or more
percentages, amounts or formulas that is more restrictive or has a shorter grace period than those set forth herein or is more
beneficial to the holder or holders of such other Indebtedness (and such provision shall be deemed an Additional Default only to
the extent that it is more restrictive or more beneficial) or (ii) is different from the subject matter of any Default or Event
of Default contained in Article VIII of this Agreement, or related definitions in Section 1.1 of this Agreement.


 


“Administrative
Questionnaire” shall mean, with respect to the Lender, an administrative questionnaire in the form prepared by the
Lender and submitted to the Lender.


 


“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.


 


“Anti-Terrorism
Laws” has the meaning given to such term in Section 4.16.


 


“Approved
Fund” shall mean any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding
or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business and that is
administered or managed by (i) the Lender, (ii) an Affiliate of the Lender or (iii) an entity or an Affiliate of an entity that
administers or manages the Lender.


 


“Asset Sale”
has the meaning given to such term in Section 2.5(d).


 


“Assignment
and Acceptance” shall mean an Assignment and Acceptance entered into by the Lender and an assignee, in the form of
Exhibit A attached hereto.


 


“Bank of
North Carolina” shall mean Bank of North Carolina, a state bank chartered in the State of North Carolina and wholly-owned
Subsidiary of the Borrower.


 


“Base Rate”
shall mean the highest of: (i) the prevailing rate of interest, on a per annum basis, described in the Eastern Edition of
The Wall Street Journal as the prime lending rate, as in effect from time to time, (ii) the Federal Funds Rate, as
in effect from time to time, plus one-half of one percent (0.50%) per annum and (iii) LIBOR determined on a daily basis
for an Interest Period of one (1) month, plus one percent (1.00%) per annum. The Lender’s prime lending rate is a
reference rate and does not necessarily represent the lowest or best rate actually charged to any customer. 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
any of the rates described above in this definition shall be effective from and including the date such change is announced as
being effective.


 


“Base Rate
Borrowing” shall mean the Borrowing of the Term Loan (or portion thereof) as a Base Rate Loan.


 


“Base Rate
Loan” shall mean the Term Loan (or any portion thereof) to the extent it is accruing interest at the Base Rate.


 




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“Base Rate
Margin” shall mean 3.50% per annum.


 


“Borrower
SEC Documents” shall have the meaning set forth in Section 4.20 hereof.


 


“Borrowing”
shall mean a borrowing consisting of the Term Loan (or portion thereof) of the same Type, made, converted or continued on the same
date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.


 


“Business
Day” shall mean (i) any day other than a Saturday, Sunday or other day on which commercial banks in Columbus,
Georgia are authorized or required by law to close and (ii) if such day relates to a 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 each 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).


 


“Capital
Stock” means any and all shares, equity interests, participations or other equivalents (however designated) of capital
stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including any preferred
interests and preferred shares, partnership interests and membership interests, and any and all warrants, rights or options to
purchase or other arrangements or rights to acquire any of the foregoing.


 


“Capital
Lease Obligations” of any Person shall mean all obligations of such Person to pay rent or other amounts under any
lease (or other arrangement conveying the right to use) of real or personal property, or a combination thereof, which obligations
are required to be classified and accounted for as capital lease obligations on a balance sheet of such Person under GAAP, and
the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.


 


“Cash”
means money, currency or a credit balance in any Deposit Account, in each case, owned by the Borrower or its Subsidiaries, but
only to the extent the foregoing is not subject to any Lien.


 


“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 a
material portion 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: (x) 25.0% or more of the outstanding shares of the Voting Stock of the Borrower and/or (y) other Capital Stock of the Borrower
representing 25.0% or more of the economic interests of the Borrower, (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 Borrower’s
board of directors as constituted as of the Closing Date or (B) appointed by directors so nominated after the Closing Date,
or (b) the Borrower shall own, directly or indirectly, less than 100% of the Voting Stock of any Financial Institution Subsidiary.


 




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“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 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; provided,
however, that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection
Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules,
guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or
any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III,
shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.


 


“Closing
Date” shall mean the date on which the conditions precedent set forth in Section 3.1 have been satisfied or
waived in accordance with the terms of this Agreement.


 


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


 


“Compliance
Certificate” shall mean a certificate from the Chief Financial Officer or the President of the Borrower in the form
of, and containing the certifications set forth in, the certificate attached hereto as Exhibit 5.1(c).


 


“Contractual
Obligation” of any Person shall mean any provision of any security issued by such Person or of any agreement, instrument
or undertaking under which such Person is obligated or by which it or any of the property in which it has an interest is bound.


 


“Control”
shall mean the power, directly or indirectly, to 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 2.6(b).


 


“Deposit
Account” means a demand, time, savings, passbook or like account with a bank, savings and loan association, credit
union or like organization, other than an account evidenced by a negotiable certificate of deposit.


 


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


 




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“Employee
Benefit Plan” shall have that meaning as defined in Section 3(3) of ERISA and for which the Borrower or an ERISA
Affiliate maintains, contributes to or has an obligation to contribute to on behalf of participants who are or were employed by
the Borrower or its ERISA Affiliates or on behalf of beneficiaries of such participants.


 


“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 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, contingent or otherwise (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 actual or alleged violation of
any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous
Materials, (c) any actual or alleged exposure to any Hazardous Materials, (d) the Release or threatened 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 including
any regulations promulgated thereunder.


 


“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 303 of ERISA and Section 430 of the Code, is treated
as a single employer under Section 414 of the Code.


 


“ERISA Event”
shall mean with respect to the Borrower or any ERISA Affiliate, (i) any “reportable event”, as defined in Section 4043
of ERISA with respect to a Plan (other than an event for which the 30-day notice period is waived); (ii) the failure to make required
contributions when due to a Multiemployer Plan or Plan or the imposition of a Lien in favor of a Plan under Section 430(k) of the
Code or Section 303(k) of ERISA; (iii) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application
for a waiver of the minimum funding standard with respect to any Plan; (iv) the imposition of any liability under Title IV of ERISA,
other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, or the imposition of an Lien in favor of the PBGC
under Title IV of ERISA; (v) the receipt 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; (vi) any other event or condition that
might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan or Multiemployer Plan or for the imposition of liability under Section 4069 or 4212(c) of ERISA;
(vii) the incurrence of any liability with respect to the withdrawal or partial withdrawal from any Plan including the withdrawal
from a Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer, as defined in Section 4001(a)(2)
of ERISA, or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (viii) or the incurrence
of any Withdrawal Liability with respect to any Multiemployer Plan; (ix) the receipt of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent (within the meaning of Section
4245 of ERISA) or in reorganization (within the meaning of Section 4241 of ERISA), or in “critical” status (within
the meaning of Section 432 of the Code or Section 305 of ERISA); or (x) a determination that a Plan is, or is reasonably expected
to be, in “at risk” status (within the meaning of Section 430 of the Code or Section 303 of ERISA).


 




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“Eurodollar”
when used in reference to the Term Loan, refers to the Term Loan bearing interest at a rate determined by reference to LIBOR.


 


“Eurodollar
Borrowing” shall mean the Borrowing of the Term Loan (or any portion thereof) as a Eurodollar Loan.


 


“Eurodollar
Loan” shall mean the Term Loan to the extent it is accruing interest based on LIBOR.


 


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


 


“Excluded
Taxes” shall mean with respect to the Lender or any other recipient of any payment to be made by or on account of
any obligation of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its net income by the
United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal
office is located or, in the case of the Lender, in which its applicable lending office is located, and (b) any branch profits
taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Lender is located.


 


“FCPA”
shall have the meaning set forth in Section 4.22 hereof.


 


“FDIC”
shall mean the Federal Deposit Insurance Corporation.


 


“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) those Financial Institution Subsidiaries set forth on Schedule
4.12 and designated as a “Financial Institution Subsidiary” and (b) each other Subsidiary 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.


 




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“Fiscal Year”
shall mean each fiscal year of the Borrower and its Subsidiaries.


 


“FRB”
shall mean the Board of Governors of the Federal Reserve System.


 


“FR Y-9C
Report” 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 Y-9LP
Report” 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 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, any other nation 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,
including without limitation, the FRB, the FDIC and any other federal or state agency charged with the supervision or regulation
of depositary institutions or holding companies of depositary institutions (as used herein, including any trust company subsidiaries
whether or not they take deposits), or engaged in the insurance of depositary institution deposits, or any court, administrative
agency or commission or other governmental agency, authority or instrumentality having supervisory or regulatory authority with
respect to the Borrower and/or any of its Subsidiaries.


 


“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
Obligations” of any Person shall mean any and all obligations of such Person, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired under (i) any and all Hedging Transactions, (ii) any and all cancellations,
buy backs, reversals, terminations or assignments of any Hedging Transactions and (iii) any and all renewals, extensions and modifications
of any Hedging Transactions and any and all substitutions for any Hedging Transactions.


 




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“Hedging
Transaction” of any Person shall mean (a) any transaction (including an agreement with respect to any such transaction)
now existing or hereafter entered into by such Person that is a rate swap transaction, swap option, basis swap, forward rate transaction,
commodity swap, commodity option, equity or equity index swap or option, bond option, interest rate option, foreign exchange transaction,
cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency
option, spot transaction, credit protection transaction, credit swap, credit default swap, credit default option, total return
swap, credit spread transaction, repurchase transaction, reverse repurchase transaction, buy/sell-back transaction, securities
lending transaction, or any other similar transaction (including any option with respect to any of these transactions) or any combination
thereof, whether or not any such transaction is governed by or subject to any master agreement and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement,
or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”),
including any such obligations or liabilities under any Master Agreement.


 


“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;
provided, that for purposes of Section 8.1(f), trade payables overdue by more than 90 days shall be included in this
definition except to the extent that any of such trade payables are being disputed in good faith and by appropriate measures),
(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 Capital Stock of such Person, (x) all Hedging Obligations of such Person; and (xi) all obligations of such Person in
respect of any trust preferred securities, preferred equity or other types of hybrid capital securities issued by such Person.
For purposes of determining the amount of attributed Indebtedness from Hedging Obligations, the “principal amount”
of any Hedging Obligations at any time shall be the Net Mark-to-Market Exposure of such Hedging Obligations.


 


“Indemnified
Taxes” shall mean Taxes other than Excluded Taxes.


 


“Interest
Period” shall mean, in the case of a Eurodollar Loan, a period of one, two or three months, provided that:



 


(i)          the
initial Interest Period for the Term Loan shall commence on the Closing Date and each Interest Period occurring thereafter in respect
of the Term 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;


 




    	- 8 -



    	 



    

 


(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 Maturity Date; and


 


(v)         there
may be no more than three Interest Periods for the Term Loan outstanding at the same time.


 


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


 


“Lender”
shall have the meaning assigned to such term in the opening paragraph of this Agreement.


 


“LIBOR”
shall mean, for any applicable Interest Period with respect to the Term Loan, that rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) that is equal to the quotient of:


 


(i)          the
greater of: (A) 1.00% per annum and (B) the rate per annum for deposits in Dollars for a period equal to such Interest Period appearing
on Reuters Screen LIBOR01 Page (or any successor page), or such similar service as determined by the Lender that 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. (New York, New York 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 for the applicable Interest Period
to which the Lender is subject with respect to a Eurodollar 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). A Eurodollar Loan shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be available from time to time to the Lender under Regulation
D. This percentage will be adjusted automatically on and as of the effective date of any change in any reserve percentage.


 




    	- 9 -



    	 



    

 


“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 Term 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, financial condition, assets,
liabilities or prospects of the Borrower and of the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the
Borrower to perform any of its material 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.


 


“Maturity
Date” shall mean April 26, 2018.


 


“Money Laundering
Laws” shall have the meaning set forth in Section 4.23 hereof.


 


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


 


“Net Cash
Proceeds” shall mean (a) with respect to any sale or disposition by the Borrower or any of its Subsidiaries of assets,
the amount of cash proceeds received (directly or indirectly) from time to time (whether as initial consideration or through the
payment of deferred consideration) by or on behalf of the Borrower or its Subsidiaries, in connection therewith after deducting
therefrom only (i) the amount of any Indebtedness secured by any Lien permitted by Section 7.2 hereof on any asset (other
than (A) Indebtedness owing to the Lender under this Agreement or the other Loan Documents and (B) Indebtedness assumed by the
purchaser of such asset) which is required to be, and is, repaid in connection with such sale or disposition, (ii) reasonable
fees, commissions, and expenses related thereto and required to be paid by the Borrower or such Subsidiary in connection with such
sale or disposition and (iii) taxes paid or payable to any taxing authorities by the Borrower or such Subsidiary in connection
with such sale or disposition, in each case, to the extent, but only to the extent, that the amounts so deducted are, at the time
of receipt of such cash, actually paid or payable to a Person that is not an Affiliate of the Borrower or any of its Subsidiaries,
and are properly attributable to such transaction; and (b) with respect to the issuance or incurrence of any Indebtedness
by the Borrower or any of its Subsidiaries, or the issuance by the Borrower or any of its Subsidiaries of any shares of its Capital
Stock, the aggregate amount of cash received (directly or indirectly) from time to time (whether as initial consideration or through
the payment or disposition of deferred consideration) by or on behalf of the Borrower or such Subsidiary in connection with such
issuance or incurrence, after deducting therefrom only: (i) reasonable fees, commissions, and expenses related thereto and required
to be paid by the Borrower or such Subsidiary in connection with such issuance or incurrence, and (ii) taxes paid or payable to
any taxing authorities by the Borrower or such Subsidiary in connection with such issuance or incurrence, in each case to the extent,
but only to the extent, that the amounts so deducted are, at the time of receipt of such cash, actually paid or payable to a Person
that is not an Affiliate of the Borrower or any of its Subsidiaries, and are properly attributable to such transaction.


 




    	- 10 -



    	 



    

 


“Net Insurance/Condemnation
Proceeds” means an amount equal to: (i) any Cash payments or proceeds received by the Borrower or any of its
Subsidiaries (a) under any casualty, business interruption or “key man” insurance policies in respect of any covered
loss thereunder, or (b) as a result of the taking of any assets of the Borrower or any of its Subsidiaries by any Person pursuant
to the power of eminent domain, condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser with such power
under threat of such a taking, minus (ii) (a) any actual and reasonable costs incurred by the Borrower or any of its
Subsidiaries in connection with the adjustment or settlement of any claims of the Borrower or such Subsidiary in respect thereof,
and (b) any bona fide direct costs incurred in connection with any sale of such assets as referred to in clause (i)(b) of this
definition to the extent paid or payable to non-Affiliates, including income taxes payable as a result of any gain recognized in
connection therewith.


 


“Net Mark-to-Market
Exposure” of any Person shall mean, as of any date of determination with respect to any Hedging Obligation, the excess
(if any) of all unrealized losses over all unrealized profits of such Person arising from such Hedging Obligation. “Unrealized
losses” shall mean the fair market value of the cost to such Person of replacing the Hedging Transaction giving rise to such
Hedging Obligation as of the date of determination (assuming the Hedging Transaction were to be terminated as of that date), and
“unrealized profits” means the fair market value of the gain to such Person of replacing such Hedging Transaction as
of the date of determination (assuming such Hedging Transaction were to be terminated as of that date).


 


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


 


“Notice of
Conversion/Continuation” shall mean the notice given by the Borrower to the Lender in respect of the conversion or
continuation of the Term Loan as provided in Section 2.4(b).


  


“Obligations”
shall mean all indebtedness, obligations, liabilities and other amounts owing by the Borrower to the Lender and, only with respect
to Hedging Transactions, any Affiliate of the Lender, pursuant to or in connection with (a) 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 under letters of
credit, all Hedging Obligations of the Borrower, 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 and (b) any agreement governing the provision
to the Borrower or any Subsidiary of treasury or cash management services.


 






    	- 11 -



    	 



    

  


“OFAC”
shall have the meaning set forth in Section 4.24 hereof.


 


“Other Real
Estate Owned” shall mean the sum of real estate acquired in satisfaction of debts through foreclosure (as determined
by reference to the line item “foreclosed assets” under “Selected Financial Data” (Non-performing assets)
in the Borrower’s most recent Form 10-Q or 10-K, as applicable).


 


“Other Taxes”
shall mean any and all present and future stamp or documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made by, or on behalf of, the Borrower hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement or any other Loan Documents.


 


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


 


“Payment
Office” shall mean the office of the Lender located at 3280 Peachtree Rd NE, Suite 500, Atlanta, Georgia 30305, Attention:
Vickie Summey.


 


, 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
Acquisition” means any Acquisition by the Borrower or any Subsidiary, whether by purchase, merger or otherwise, of
all or substantially all of the assets of, the Capital Stock of, or a business line or unit or a division of, any Person; provided
that:


 


(a)          at
the time of such acquisition and after giving effect thereto, no Default or Event of Default shall have occurred or would result
(on a pro forma basis) from the making or consummation of such Acquisition;


 


(b)          all
transactions in connection therewith shall be consummated, in all material respects, in accordance with all applicable laws and
in conformity with all applicable governmental authorizations and all such necessary and appropriate authorizations and approvals
from all applicable Governmental Authorities having jurisdiction over the Borrower and any applicable Financial Institution Subsidiary
shall have been obtained and shall be in full force and effect;


 


(c)          in
the case of the acquisition of Capital Stock, all of the Capital Stock acquired or otherwise issued by such Person or any newly
formed, direct or indirect, Subsidiary of the Borrower in connection with such Acquisition shall be owned 100% by the Borrower
or its Subsidiaries;


 




    	- 12 -



    	 



    

 


(d)          the
Lender shall receive at least fifteen Business Days’ prior written notice of such proposed Acquisition, which notice shall
include a reasonably detailed description of such proposed Acquisition;


 


(e)          (i)
such acquisition shall only involve a business permitted in accordance with Section 7.3(c), and which business would not
subject the Lender to regulatory or third party approvals in connection with the exercise of its rights and remedies under this
Agreement or any other Loan Documents and (ii) substantially all of the operations of which are located in the United States;


 


(f)          without
the prior written consent of the Lender, which consent shall not be unreasonably delayed, denied or withheld, no additional Indebtedness
or other liabilities shall be incurred or assumed in connection with such acquisition, except ordinary course trade payables and
accrued expenses;


 


(g)          the
Acquisition shall have been approved by the board of directors or other governing body or controlling Person of the Person acquired
or the Person from whom such assets or division is acquired;


 


(h)          the
total assets of the Person or series of related Persons to be acquired in any Acquisition or series of related Acquisitions shall
not exceed, without the prior written consent of the Lender, an amount equal to (A) $200,000,000 per Acquisition (or series
of related Acquisitions), (B) when taken together with the total assets acquired by the Borrower and its Subsidiaries for all Acquisitions
consummated in any fiscal year, $350,000,000 per such fiscal year, or (C) when taken together with the total assets acquired by
the Borrower and its Subsidiaries for all Acquisitions consummated during the term of this Agreement, $1,000,000,000;


 


(i)          the
business and assets acquired in such acquisition shall be free and clear of all Liens (other than Permitted Liens);


 


(j)          concurrently
with delivery of the notice referred to in clause (d) of this definition, the Borrower shall have delivered to the Lender, in form
and substance reasonably satisfactory to the Lender, a certificate of a Responsible Officer of the Borrower to the effect that
(i) each of (x) such Person, (y) the Borrower and (z) the Subsidiaries of the Borrower, taken as a whole, will be Solvent
upon the consummation of the Acquisition, (ii) the Borrower and its Subsidiaries have completed their due diligence investigation
with respect to such Acquisition, which investigation was conducted in a manner similar to that which would have been conducted
by a prudent purchaser of a comparable business and the results of which investigation shall be delivered to the Lender upon its
reasonable request and (iii) the Borrower will be, after giving pro forma effect to the proposed Acquisition, in compliance
with the covenants set forth in Section 6.1 hereof, together with the calculations thereof demonstrating such compliance;


 


(k)          at
least fifteen Business Days prior (or such alternative date acceptable to the Lender) to the date of such Acquisition, the Lender
shall have received, in form and substance reasonably satisfactory to the Lender, copies of the acquisition agreement and related
agreements and instruments, and all opinions, certificates, lien search results, copies of all environmental reports and memoranda
related thereto to the extent prepared in connection with such acquisition and other documents related thereto reasonably requested
by the Lender; and


 




    	- 13 -



    	 



    

 


(l)          the
Borrower shall have delivered to the Lender copies of all such financial statements and other financial information related to
the Person or the assets to be acquired as the Lender shall reasonably request, which shall in any event include: (i) all financial
statements and financial information regarding the Person or assets to be acquired that have been received by, or prepared for,
the Borrower in connection with such proposed Permitted Acquisition and (ii) internally-prepared financial statements with respect
to such Person or assets for the most recently-ended four fiscal quarters, which shall, in each case, be reasonably satisfactory
in form and substance to the Lender.


 


In the case of any
Acquisition by the Borrower or any Subsidiary in which the Borrower or such Subsidiary acquires, directly or indirectly, fifty
percent (50%) or more of the voting stock any Person that is a regulated financial institution, such acquired Person shall become
a Financial Institution Subsidiary for purposes of this Agreement. In the event the proposed Acquisition does not satisfy one or
more of the above criteria, but the Lender nevertheless, in its sole discretion, consents to such Acquisition, such Acquisition
shall constitute a “Permitted Acquisition” and be included in the calculations set forth in clause (h) hereof and other
applicable provisions hereof.


 


“Permitted
Encumbrances” shall mean


 


(i)          Liens
imposed by law for taxes 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;


 


(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 and Liens arising by statute in connection with worker’s compensation, unemployment
insurance, old age benefits, social security obligations, taxes, assessments, statutory obligations or other similar charges, good
faith cash deposits in connection with tenders, contracts or leases to which the Borrower or any of its Subsidiaries is a party
or other cash deposits in any such foregoing case that is required to be made in the ordinary course of business, provided in each
case that the obligation is not for borrowed money and that the obligation secured is not overdue or, if overdue, is being contested
in good faith by appropriate proceedings which prevent enforcement of the matter under contest and adequate reserves have been
established therefor;


 




    	- 14 -



    	 



    

 


 


(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;


 


(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 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;


 


(vii)       Liens,
charges and encumbrances incidental to the conduct of the business of the Financial Institution Subsidiaries incurred in the ordinary
course of business and consistent with past practices;


 


(viii)      Liens
to secure public funds or other pledges of funds required by law to secure deposits; and


 


(ix)         repurchase
agreements, reverse repurchase agreements and other similar transactions entered into by any Financial Institution Subsidiary in
the ordinary course of its banking, deposit or trust business;


 


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


 


“Permitted
Financial Institution Subsidiary Indebtedness” means obligations incurred by any Financial Institution Subsidiary
in the ordinary course of business in such circumstances as may be incidental or usual in carrying on the banking or trust or mortgage
business of a bank, thrift, trust company, or mortgage company incurred in accordance with applicable laws and regulations and
safe and sound practices, including obligations incurred in connection with: (a) any deposits with or funds collected by such Subsidiary;
(b) the endorsement of instruments for deposit or collection in the ordinary course of business, (c) any bankers acceptance credit
of such Subsidiary; (d) any check, note, certificate of deposit, money order, traveler’s check, draft or bill of exchange
issued, accepted or endorsed by such Subsidiary or letter of credit issued by such Subsidiary; (e) any discount with, borrowing
from, or other obligation to, any Federal Reserve Bank or any Federal Home Loan Bank; (f) any agreement made by such Subsidiary
to purchase or repurchase securities, loans or Federal funds or any interest or participation in any thereof; (g) any guarantee,
indemnity or similar obligation incurred by such Subsidiary in the ordinary course of its banking or trust business and consistent
with past practices; (h) any transaction in the nature of an extension of credit, whether in the form of a commitment or otherwise,
undertaken by such Subsidiary for the account of a third party with the application of the same banking considerations and legal
lending limits that would be applicable if the transaction were a loan to such party; (i) any transaction in which such Subsidiary
acts solely in the fiduciary or agency capacity; (j) other short-term liabilities similar to those enumerated in clauses (a) and
(f) above, including United States Treasury tax and loan borrowings, (k) any Hedging Obligations or other obligations or liabilities
relating to Hedging Transactions entered into by such Subsidiary in connection with facilitating the hedging risk of a customer
of such Subsidiary or another Financial Institution Subsidiary, but excluding any Hedging Obligations or other obligations or liabilities
relating to Hedging Transactions entered into for speculative purposes or that are speculative in nature, (l) any Indebtedness
of one Financial Institution Subsidiary to another Financial Institution Subsidiary and (m) any Indebtedness of such Subsidiary
relating to letters of credit issued or confirmed by a third party financial institution for the account of such Subsidiary for
the ultimate account of such Subsidiary’s customer.


 




    	- 15 -



    	 



    

 


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


 


“Plan”
shall mean any Employee 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 either (i) maintains, contributes
to or has an obligation to contribute to on behalf of participants who are or were employed by any of them (or on behalf of beneficiaries
of such participants) or (ii) 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 or a “contributing sponsor” (as defined in ERISA Section 4001(a)(13)).


 


“Qualified
Plan” shall mean an Employee Benefit Plan that is intended to be tax-qualified under Section 401(a) of the Code.


 


“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.


 


“Regulatory
Agreement” shall have the meaning set forth in Section 4.19 hereof.


 


“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 managing director 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 chief
financial officer, controller or the treasurer of the Borrower.


 


“RICO Related
Law” shall mean the Racketeer Influenced and Corrupt Organizations Act of 1970 or any other federal, state or local
law for which forfeiture of assets is a potential penalty.


 




    	- 16 -



    	 



    

 


“Sarbanes-Oxley
Act” shall have the meaning set forth in Section 4.21 hereof.


 


“Series A
Perpetual Preferred Stock” shall mean the Fixed Rate Cumulative Perpetual Preferred Stock, Series A,
liquidation preference $1,000.00 per share, of Borrower.


 


“Solvent”
shall have the meaning set forth in Section 4.17.


 


“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 50% of the equity or more than 50% of the ordinary voting power, or in the
case of a partnership, more than 50% 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” under this Agreement 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.


 


“Taxes”
means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed
by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.


 


“Term Loan”
shall have the meaning set forth in Section 2.1.


 


“Term Loan
Commitment” shall mean the obligation of the Lender to make a Term Loan hereunder on the Closing Date in a principal
amount not exceeding $30,000,000.


 


“Term Note”
shall mean a promissory note of the Borrower payable to the order of the Lender in the principal amount of $30,000,000, in substantially
the form of Exhibit B.


 


“Total Loans”
shall mean for the Borrower on a consolidated basis the line item “Loans” set forth on the Borrower’s consolidated
balance sheet delivered pursuant to Section 5.1(a) and Section 5.1(b) (and, for the avoidance of doubt, shall exclude
loans held for sale).


 


“Type”,
when used in reference to the Term Loan, refers to whether the rate of interest on the Term Loan is determined by reference to
LIBOR or the Base Rate.


 


“Voting Stock” shall
mean shares of Capital Stock entitled to vote generally in the election of directors.


 




    	- 17 -



    	 



    

 


“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
public accountants) with the most recent audited consolidated financial statement of the Borrower delivered pursuant to Section
5.1(a) (or, if no such financial statements have been delivered, on a basis consistent with the audited consolidated financial
statements of the Borrower and its Subsidiaries last delivered to the Lender in connection with this Agreement); 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 the Lender 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. Notwithstanding any other provision contained
herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios
referred to herein shall be made, without giving effect to any election under Accounting Standards Codification Section 825-10
to value any Indebtedness or other liabilities of the Borrower or any Subsidiary at “fair value”, as defined therein.


 


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, restated, 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; (v) all references
to a specific time shall be construed to refer to Columbus, Georgia time, unless otherwise indicated; and (vi) any reference to
any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented
from time to time. To the extent that any of the representations and warranties contained in Article IV under this Agreement
is qualified by “Material Adverse Effect”, then the qualifier “in any material respect” contained in Section
8.1(c) shall not apply. Unless otherwise expressly provided herein, all references to dollar amounts shall mean Dollars.


 




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Article
II           AMOUNT AND TERMS OF THE TERM LOAN


 


Section
2.1.          Term Loan Commitment. Subject to the terms
and conditions set forth herein, including, without limitation, satisfaction of the conditions set forth in Section 3.1,
the Lender agrees to make a single term loan (the “Term Loan”) to the Borrower in a principal amount equal
to the Term Loan Commitment on the Closing Date.


 


Section
2.2.          Procedure for Borrowing Term Loan. The Borrower
shall give the Lender written notice of its request for the Borrowing substantially in the form of Exhibit 2.2 attached
hereto (the “Notice of Borrowing”) prior to 11:00 a.m. on, in the case such Borrowing is a Eurodollar Borrowing,
the date that is three (3) Business Days prior to the date of the Borrowing or, in the case such Borrowing is a Base Rate Borrowing,
the date of such Borrowing. The Notice of Borrowing shall be irrevocable and shall specify: (i) the date of the Borrowing (which
shall be a Business Day), (ii) the Type of such Borrowing, (iii) the duration of the Interest Period applicable thereto in the
case of a Eurodollar Borrowing and (iv) the account of the Borrower to which the proceeds of the Term Loan should be credited.
With respect to the conversion or continuation of any portion of the Term Loan, such conversion or continuation shall be in an
aggregate principal amount of no less than $2,000,000 or a larger multiple of $1,000,000.


 


Section
2.3.          Funding of Borrowing. Subject to the
terms and conditions herein, the Lender will make the proceeds of the Term Loan available to the Borrower on the Closing Date
by promptly crediting the proceeds thereof by the close of business on such date, to an account maintained by the Borrower with
the Lender or at the Borrower’s option, by effecting a wire transfer of such amounts to an account designated by the Borrower
to the Lender as set forth in the Notice of Borrowing.


 


Section
2.4.          Interest Elections.


 


(a)          Each
Borrowing initially shall be of the Type specified in the applicable Notice of Borrowing, and in the case of a Eurodollar Borrowing,
shall have an initial Interest Period as specified in such Notice of Borrowing. Thereafter, the Borrower may elect to convert such
Borrowing into a different Type or to continue such Borrowing, and in the case of a Eurodollar Borrowing, may elect Interest Periods
therefor, all as provided in this Section 2.4.


 


(b)          To
make an election pursuant to this Section 2.4, the Borrower shall give the Lender prior written notice (or telephonic notice
promptly confirmed in writing) of each Borrowing substantially in the form of Exhibit 2.4 attached hereto (a “Notice
of Conversion/Continuation”) that is to be converted or continued, as the case may be, (x) prior to 11:00 a.m. one Business
Day prior to the requested date of a conversion into a Base Rate Borrowing and (y) prior to 11:00 a.m. three Business Days prior
to a continuation of or conversion into a Eurodollar Borrowing. Each such Notice of Conversion/Continuation shall be irrevocable
and shall specify (i) the Borrowing to which such Notice of Conversion/Continuation applies and if different options are being
elected with respect to different portions thereof, the portions thereof that are to be allocated to each resulting Borrowing (in
which case the information to be specified pursuant to clauses (iii) and (iv) shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Notice of Conversion/Continuation, which shall be a Business Day,
(iii) whether the resulting Borrowing is to be a Base Rate Borrowing or a Eurodollar Borrowing; and (iv) if the resulting Borrowing
is to be a Eurodollar Borrowing, the Interest Period applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of “Interest Period”. If any such Notice of Conversion/Continuation requests
a Eurodollar Borrowing but does not specify an Interest Period, the Borrower shall be deemed to have selected an Interest Period
of one month. The principal amount of any resulting Borrowing shall satisfy the minimum borrowing amount for Eurodollar Borrowings
and Base Rate Borrowings set forth in Section 2.2.


 




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(c)          If,
on the expiration of any Interest Period in respect of any Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice
of Conversion/ Continuation, then, unless such Borrowing is repaid as provided herein, the Borrower shall be deemed to have elected
to convert such Borrowing to a Base Rate Borrowing. No Borrowing may be converted into, or continued as, a Eurodollar Borrowing
if a Default or an Event of Default exists, unless the Lender shall have otherwise consented in writing. No conversion of any Eurodollar
Loans shall be permitted except on the last day of the Interest Period in respect thereof.


 


Section
2.5.          Repayment and Prepayments of Term Loan.


 


(a)          The
Borrower unconditionally promises to pay to the Lender the then unpaid principal amount of the Lender’s Term Loan in installments
in the principal amount set forth below and payable on the dates set forth below (and on such other date(s) and in such other amounts
as may be required from time to time pursuant to this Agreement):


 


	Installment Date	 	Aggregate Principal Amount	 
	June 30, 2013	 	$	375,000	 
	September 30, 2013	 	$	375,000	 
	December 31, 2013	 	$	375,000	 
	March 31, 2014	 	$	375,000	 
	June 30, 2014	 	$	562,500	 
	September 30, 2014	 	$	562,500	 
	December 31, 2014	 	$	562,500	 
	March 31, 2015	 	$	562,500	 
	June 30, 2015	 	$	937,500	 
	September 30, 2015	 	$	937,500	 
	December 31, 2015	 	$	937,500	 
	March 31, 2016	 	$	937,500	 
	June 30, 2016	 	$	937,500	 
	September 30, 2016	 	$	937,500	 
	December 31, 2016	 	$	937,500	 
	March 31, 2017	 	$	937,500	 
	June 30, 2017	 	$	1,125,000	 
	September 30, 2017	 	$	1,125,000	 
	December 31, 2017	 	$	1,125,000	 






 



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Further, to the extent
not previously paid, the entire outstanding principal balance of the Term Loan shall be due and payable (together with accrued
and unpaid interest thereon) on the Maturity Date. Once repaid, no portion of the Term Loan may be reborrowed.


 


(b)          During
the periods after the Closing Date set forth below, the Borrower may only voluntarily prepay the Term Loan, in whole or in part,
at the prices (expressed as percentages of principal amount of the Term Loan to be prepaid) set forth below, plus accrued and unpaid
interest, if any, to the date of prepayment:


 


	Period	 	Percentage	 
	From the Closing Date to and including April 30, 2014	 	 	102.00	%
	From May 1, 2014 to and including April 30, 2015	 	 	101.00	%
	From May 1, 2015 and thereafter	 	 	100.00	%



  


The Borrower acknowledges
and agrees that the amount payable by it in connection with the voluntary prepayment of the Term Loan is a reasonable calculation
of the Lender’s lost profits in view of the difficulties and impracticality of determining actual damages resulting from
the prepayment of the Term Loan. Notwithstanding the foregoing, this Section 2.5(b) shall not be applicable to any prepayments
required pursuant to clauses (d), (e), (f) and (g) of this Section 2.5.


 


(c)          All
voluntary prepayments of the Term Loan pursuant to paragraph (b) hereof shall be preceded by irrevocable written notice to the
Lender no less than three (3) Business Days prior to any such prepayment. Each prepayment notice shall be irrevocable and shall
specify the proposed date of such prepayment and the principal amount of the Term Loan to be prepaid. If such notice is given,
the aggregate amount specified in such notice shall be due and payable on the date designated in such notice, together with accrued
interest to such date on the amount so prepaid in accordance with Section 2.15(a); provided, that if a Eurodollar
Loan is 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 2.13. Each partial prepayment of the Term Loan shall be in an amount not less than $100,000
and in integral multiples of $100,000 in excess thereof.


 


(d)          Immediately
upon receipt by the Borrower or any Subsidiary of the Borrower of any Net Cash Proceeds of any sale or disposition by the Borrower
or such Subsidiary of assets in excess of $10,000,000 (excluding (i) the transfer of assets to the Borrower or any other
Subsidiary; (ii) the disposition of any Hedging Transaction; (iii) the sale of loans and/or Other Real Estate Owned in the ordinary
course of business having, in the case of loans, an aggregate unpaid principal balance and, in the case of Other Real Estate Owned,
fair market value, not to exceed in the aggregate $10,000,000 in any single transaction or series of related transactions; and
(iv) the disposition of any Cash or Investments made in the ordinary course of business in connection with asset management) (an
“Asset Sale”), the Borrower shall prepay the Obligations in an aggregate amount equal to 100% of such Net Cash
Proceeds. Any such prepayment shall be applied in accordance with Section 2.5(i).


 




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(e)          Immediately
upon receipt by the Borrower or any Subsidiary of any Net Insurance/Condemnation Proceeds, unless the parties have agreed otherwise
in writing, the Borrower shall prepay the Obligations in an aggregate amount equal to 100% of such Net Insurance/Condemnation Proceeds.
Any such prepayment shall be applied in accordance with Section 2.5(i).


 


(f)          On
the date of receipt by the Borrower or any of its Subsidiaries of any Net Cash Proceeds from a capital contribution to, or the
issuance of any Capital Stock of, the Borrower or any of its Subsidiaries (other than: (i) Capital Stock issued by a Subsidiary
of the Borrower to the Borrower or another Subsidiary, (ii) issuances of Capital Stock to employees, consultants, officers or directors
in connection with employee stock options or other equity incentives, or (iii) Capital Stock issued to the seller of an acquired
business in connection with a Permitted Acquisition), the Borrower shall prepay the Obligations in an aggregate amount equal to
100% of such Net Cash Proceeds. Any such prepayment shall be applied in accordance with Section 2.5(i).


 


(g)          On
the date of receipt by the Borrower or any of its Subsidiaries of any Net Cash Proceeds from the incurrence of any Indebtedness
of the Borrower or any of its Subsidiaries (other than with respect to any Indebtedness permitted to be incurred pursuant to Section
7.1), the Borrower shall prepay the Obligations in an aggregate amount equal to 100% of such Net Cash Proceeds. Any such prepayment
shall be applied in accordance with Section 2.5(i). Such prepayment shall not constitute a waiver or discharge of any Event
of Default that may arise by reason of the incurrence of such Indebtedness.


 


(h)          Concurrently
with any prepayment of the Term Loan pursuant to clauses (d), (e), (f) and (g) of this Section 2.5, the Borrower shall deliver
to the Lender a certificate of a Responsible Officer demonstrating the calculation of the amount of the Net Cash Proceeds or Net
Insurance/Condemnation Proceeds, as applicable. In the event that the Borrower shall subsequently determine that the actual amount
received exceeded the amount set forth in such certificate, the Borrower shall promptly make an additional prepayment of the Term
Loan in an amount equal to such excess, and the Borrower shall concurrently therewith deliver to the Lender a certificate of a
Responsible Officer demonstrating the derivation of such excess.


   


(i)          Subject
to Section 2.13, all voluntary prepayments of the Term Loan pursuant to Section 2.5(b) and mandatory prepayments
of the Term Loan required to be prepaid pursuant to clauses (d), (e), (f) and (g) of this Section 2.5 shall applied as follows:


 


first, to the payment of
all fees, and all expenses specified in Section 9.3, to the full extent thereof;


 


second, to the payment of
any accrued Default Interest, if any;


 


third, to the payment of
any accrued interest with respect to the Term Loan;


 


fourth, to the remaining
principal installments of the Term Loan, in inverse order of maturity, until the Term Loan is repaid in full;


 




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fifth, to all other Obligations
owed to the Lender, until paid in full; and


 


sixth, any remaining amounts
shall be paid to the Borrower or its designee.


 


(j)          Any
prepayment of required by this Section 2.5 shall be applied first to Base Rate Loans to the full extent thereof before application
to LIBOR Loans.


 


(k)          Nothing
in this Section 2.5 shall be interpreted to permit or authorize the Borrower or any Subsidiary to effect, cause or allow
to occur any sale or disposition of assets, sale or issuance of Capital Stock or Indebtedness or any other transaction that would
otherwise be prohibited by Article VII or any of the other terms or provisions of this Agreement or the other Loan Documents.


 


Section
2.6.          Interest on Term Loan.


 


(a)          The
Borrower shall pay interest on the Term Loan at, in the case of any portion of the Term Loan that is a Eurodollar Loan, LIBOR for
the applicable Interest Period then in effect plus 4.50% per annum and, in the case of any portion of the Term Loan that
is a Base Rate Loan, the Base Rate in effect from time to time plus 3.50%.


 


(b)          Following
the occurrence of an Event of Default, the Borrower shall pay interest (“Default Interest”) with respect
to a Eurodollar Loan, at the rate otherwise applicable for the then-current Interest Period plus an additional 2.00% per
annum until the last day of such Interest Period, and thereafter, and with respect to a Base Rate Loan and all other Obligations
under this Agreement (other than the Term Loan), at the Base Rate plus the Base Rate Margin plus 2.00% per annum.


 


(c)          Interest
on the principal amount of the Term Loan shall accrue from and including the Closing Date to but excluding the date of any repayment
thereof (or portion thereof). Interest on a Eurodollar Loan shall be payable in arrears on the last day of each Interest Period
applicable thereto and on the Maturity Date. Interest on a Base Rate Loan shall be payable in arrears on the last day of each calendar
month and on the Maturity Date. All Default Interest shall be payable on demand.


 


(d)          The
Lender shall determine each interest rate applicable to the Term Loan hereunder 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
2.7.          Fees. The Borrower shall pay to the Lender an
upfront fee equal to 1.00% of the aggregate principal amount of the Term Loan funding on the Closing Date, which shall be due
and payable on the Closing Date.


 


Section
2.8.          Computation of Interest and Fees. Interest hereunder
based on the Lender’s prime lending rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year)
and paid for the actual number of days elapsed (including the first day but excluding the last day). All other 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.


 




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Section
2.9.          Inability to Determine Interest Rates. If prior
to the commencement of any Interest Period for a Eurodollar Loan, the Lender shall have determined (which determination shall
be conclusive and binding upon the Borrower) that (a) by reason of circumstances affecting the relevant interbank market,
adequate means do not exist for ascertaining LIBOR, or (b) the Lender shall have determined that LIBOR does not adequately
and fairly reflect the cost to the Lender of making, funding or maintaining its Eurodollar Loan, 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, the Term Loan shall be deemed to be converted
into a Base Rate Loan as of such date and shall bear interest at the Base Rate plus the Base Rate Margin.


 


Section
2.10.         Evidence of Indebtedness. The Lender shall maintain
in accordance with its usual practice appropriate records evidencing the Indebtedness of the Borrower to the Lender resulting
from the Term Loan made or held by the Lender, including the amounts of principal and interest payable thereon and paid to the
Lender from time to time under this Agreement. The entries made in such records shall be prima facie evidence (absent manifest
error) 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 any error therein shall not in any manner affect
the obligation of the Borrower to repay the Term Loan (both principal and unpaid accrued interest) in accordance with the terms
of this Agreement. On and after the Closing Date, the Borrower will execute and deliver a Term Note to the Lender.


 


Section
2.11.         Illegality. If any Change in Law shall make it unlawful
or impossible for the Lender to maintain or continue 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 continue the Term Loan as a Eurodollar Loan shall be suspended. In the case of a Eurodollar Loan
then outstanding, such Eurodollar Loan shall be converted to a Base Rate Loan either (x) on the last day of the then current
Interest Period applicable to such Eurodollar Loan if the Lender may lawfully continue to maintain such Eurodollar Loan to the
date or (y) immediately if such Lender shall determine that it may not lawfully continue to maintain such Eurodollar Loan
to such date.


 


Section
2.12.         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 


 


 




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(ii)         impose
on the Lender or the eurodollar interbank market any other condition affecting this Agreement or a Eurodollar Loan made or held
by the Lender;


 


and the result of the foregoing is to increase
the cost to the Lender of 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 to the Borrower, to the Lender, within five Business Days after the date of such notice and demand, additional
amount or amounts sufficient to compensate such Lender for the additional costs incurred or reduction suffered.


 


(b)          If
the Lender shall have determined that on or after the date of this Agreement (but subject to the proviso contained in the defined
term “Change in Law”) any Change in Law regarding capital or liquidity 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 direct or indirect parent) as
a consequence of its obligations hereunder to a level below that the Lender or the Lender’s direct or indirect parent could
have achieved but for such Change in Law (taking into consideration the Lender’s policies or the policies of the Lender’s
direct or indirect parent with respect to capital adequacy and liquidity) then, from time to time, within five 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 direct or indirect parent for any such reduction suffered.


 


(c)          A
certificate of the Lender setting forth the amount or amounts necessary to compensate the Lender or its direct or indirect parent,
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.


 


Section
2.13.         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 conversion (even though involuntary) of a Eurodollar Loan other than on the last day of
the Interest Period applicable thereto, or (c) the failure by the Borrower to prepay or continue a 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 Business Days after written demand from the Lender, for any actual loss,
cost or expense incurred by the Lender attributable to such event. Such loss, cost or expense shall be deemed to include an amount
determined by the Lender to be the excess, if any, of (A) the amount of interest that would have accrued on the principal
amount of such Eurodollar Loan if such event had not occurred at LIBOR applicable to such Eurodollar Loan for the period from
the date of such event to the last day of the then current Interest Period therefor (or in the case of a failure to continue for
the period that would have been the Interest Period for such Eurodollar Loan) over (B) the amount of interest that would
accrue on the principal amount of such Eurodollar Loan for the same period if LIBOR were set on the date such Eurodollar Loan
was prepaid or the date on which the Borrower failed to continue such Eurodollar Loan. A certificate as to any additional amount
payable under this Section 2.13 submitted to the Borrower by the Lender shall be conclusive, absent manifest error.


 




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Section
2.14.         Taxes.


 


(a)          Any
and all payments by or on account of any Obligation of the Borrower under this Agreement or the Term Note shall be made free and
clear of and without deduction for any Indemnified Taxes or Other Taxes; provided, that if the Borrower shall be required
to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary
so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the
Lender shall receive an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower
shall make such deductions and (iii) the Borrower shall pay the full amount deducted to the relevant Governmental Authority
in accordance with applicable law.


 


(b)          In
addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.


 


(c)          The
Borrower shall indemnify the Lender, within ten Business Days after written demand therefor, for the full amount of any Indemnified
Taxes or Other Taxes paid by the Lender on or with respect to any payment by or on account of any obligation of the Borrower hereunder
(including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) and any
penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount
of such payment or liability, together with reasonable evidence of such payment, as applicable, delivered to the Borrower by the
Lender shall be conclusive absent manifest error.


 


(d)          As
soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Lender the original or a certified copy of a receipt issued by such Governmental Authority evidencing such
payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Lender.


 


Section
2.15.         Payments Generally. 


 


(a)          The
Borrower shall make each payment required to be made by it hereunder (whether of principal, interest or fees or of amounts payable
under Section 2.5, Section 2.6 or Section 2.7 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 the Payment Office, including, for the avoidance of doubt, the payments pursuant
to Section 2.12, Section 2.13 and Section 9.3. 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.


 




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(b)          If
at any time insufficient funds are received by and available to the Lender to pay fully all amounts of principal, interest and
fees then due hereunder, such funds shall be applied first, towards payment of interest and fees then due hereunder, and
second, towards payment of principal then due hereunder.


 


Article
III     CONDITIONS PRECEDENT TO EFFECTIVENESS AND BORROWING


 


Section
3.1.          Conditions To Effectiveness and Borrowing. The
obligation of the Lender to fund the Term Loan under this Agreement shall not become effective until the date on which each of
the following conditions is satisfied (or waived in accordance with Section 9.2).


 


(a)          The
Lender shall have received all fees and other amounts due and payable on or prior to the Closing Date, including, without limitation
(i) reimbursement or payment of all out-of-pocket expenses (including reasonable fees, charges and disbursements of counsel to
the) required to be reimbursed or paid by the Borrower hereunder, under any other Loan Document and (ii) all fees payable to the
Lender in accordance with the fee letter among the Borrower and the Lender;


 


(b)          The
Lender (or its counsel) shall have received the following, each in form and substance satisfactory to the Lender:


 


(i)          a
counterpart of this Agreement signed by or on behalf of each party hereto;


 


(ii)         a
duly executed Term Note payable to the Lender;


 


(iii)        a
certificate of the Secretary or Assistant Secretary of the Borrower in the form of Exhibit 3.1(b)(iii), attaching and certifying
copies of its bylaws and of the resolutions of its board 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 executing the Loan Documents;


 


(iv)        (a)
certified copies of the certificate of incorporation of the Borrower, together with certificates of good standing or existence,
as may be available from the Secretary of State of the jurisdiction of incorporation of the Borrower and each other jurisdiction
where the Borrower is required to be qualified to do business as a foreign corporation, and (b) certificates of good standing or
existence with respect to each material Subsidiary of the Borrower (which shall include, in any event, each Financial Institution
Subsidiary), as may be available from the Secretary of State of the jurisdiction of incorporation of each such Subsidiary and each
other jurisdiction where such Subsidiary is required to be qualified to do business as a foreign corporation;


 




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(v)         a
favorable written opinion of Womble, Carlyle, Sandridge & Rice LLP, 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;


 


(vi)        a
certificate in the form of Exhibit 3.1(b)(vi), dated the Closing Date and signed by a Responsible Officer, certifying that
(w) no Default or Event of Default exists, (x) all representations and warranties of the Borrower set forth in the Loan Documents
are true and correct on and as of the Closing Date, (y) since December 31, 2012, there shall have been no change, event or other
circumstance which has had or could reasonably be expected to have a Material Adverse Effect and (z) no consents, approvals, authorizations,
registrations, filings or orders of the type described in Section 3.1(b)(vii) below are required to be made or obtained
in connection with the execution, delivery, performance, validity and enforceability of the Loan Documents or any transaction contemplated
thereby;


 


(vii)       certified
copies of a non-objection letter from the Federal Reserve Bank of Richmond and all other consents, approvals, authorizations, registrations
and filings and orders required to be made or obtained under any applicable laws, or by any Contractual Obligation of the Borrower,
in connection with the execution, delivery, performance, validity and enforceability of the Loan Documents or any of the transactions
contemplated hereby or thereby, and such consents, approvals, authorizations, registrations, filings and orders shall be in full
force and effect and all applicable waiting periods shall have expired, and no investigation or inquiry by any Governmental Authority
regarding the Term Loan or any transaction being financed with the proceeds thereof shall be ongoing;


 


(viii)      copies
of (A) the internally prepared quarterly financial statements of the Borrower and its Subsidiaries on a consolidated basis for
the Fiscal Quarter ending December 31, 2012, and (B) the audited consolidated financial statements for Borrower and its Subsidiaries
for the Fiscal Year ending December 31, 2012, which, in each case, shall be acceptable to the Lender in its sole discretion;


 


(ix)         the
results of a recent UCC, tax, judgment and lien searches in respect of the Borrower, and such searches shall reveal no Liens of
record other than Liens expressly permitted pursuant to Section 7.2;


 


(x)          a
copy of the Notice of Redemption relating to the Series A Perpetual Preferred Stock being redeemed with the proceeds of the Term
Loan and such other evidence that the proceeds of the Term Loan shall be used in accordance with Section 5.9 hereof as the
Lender may reasonably request;


 


(xi)         a
duly executed Notice of Borrowing in accordance with Section 2.2 hereof;


 




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(xii)        a
duly completed and executed Compliance Certificate calculated as of December 31, 2012 (giving pro forma effect to the funding of,
and the use of the proceeds of, the Term Loan to be funded on the Closing Date);


 


(xiii)       evidence
of the filing of a Uniform Commercial Code Form UCC-1 negative pledge filing against the Borrower with the Office of the Secretary
of State of the State of North Carolina; and


 


(xiv)      such
other documents, agreements and instruments as the Lender may reasonably request.


 


Article
IV     REPRESENTATIONS AND WARRANTIES


 


The Borrower represents
and warrants to Lender as follows, as of the Closing Date, and as of the delivery of each Notice of Conversion/Continuation delivered
or deemed delivered pursuant to Section 2.4 hereof:


 


Section
4.1.          Existence; Power. Each of the Borrower and its
Subsidiaries (i) is duly organized and validly existing as a corporation, bank or other entity, as the case may be, 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 in good standing in its jurisdiction of organization and is duly qualified to do business, 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. The Borrower is duly registered as a bank holding company under the Bank Holding Company
Act of 1956, as amended. The Financial Institution Subsidiaries are the only “significant subsidiar(ies)”
of the Borrower (as such term is defined in Rule 1-02 of Regulation S-X) and have been duly organized and are validly existing
and in good standing under the laws of the jurisdiction of their respective incorporation or other organization, have the requisite
corporate power and authority to own, lease and operate their respective properties, and to conduct their respective businesses.
The deposit accounts of each Financial Institution Subsidiary are insured up to the applicable limits by the Deposit Insurance
Fund of the FDIC to the fullest extent permitted by law and the rules and regulations of the FDIC, and no proceeding for the revocation
or termination of such insurance is pending or, to the knowledge of the Borrower, threatened.


 


Section
4.2.          Organizational Power; Authorization. The Borrowing,
and 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 has been
duly executed and delivered by the Borrower and constitutes, and each other Loan Document when executed and delivered by the Borrower
will 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.


 




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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 articles of incorporation
or by-laws of the Borrower or any order of any Governmental Authority binding upon Borrower, (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 their respective assets or give rise to a right thereunder to require any payment to be made by the Borrower or any
such Subsidiary and (d) will not result in the creation or imposition of any Lien on any asset of the Borrower or any Subsidiary.
All necessary regulatory approvals have been obtained for the Borrower and its Subsidiaries to conduct their respective businesses.


 


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, 2012 and the
related consolidated statements of income, shareholders’ equity and cash flows for the fiscal year then ended prepared by
Cherry, Bekaert & Holland, L.L.P. and (ii) the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as
of December 31, 2012, 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, subject to year-end audit adjustments and the absence of footnotes. Such
financial statements fairly present, in all material respects, the consolidated financial position of the Borrower and its Subsidiaries
as of such date and the consolidated results of operations and cash flows for such period in conformity with GAAP consistently
applied. Since December 31, 2012, 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. In addition, the Borrower
has provided to the Lender copies of the Call Reports filed by its Financial Institution Subsidiaries for the period ending September 30,
2012, and copies of the FRY-9LP Report and the FRY-9C Report filed by the Borrower for the period ending September 30, 2012.
Each of such reports filed by the Borrower or the Financial Institution Subsidiaries with any Governmental Authority is true and
correct and is in accordance with the respective books of account and records of the Borrower and the Financial Institution Subsidiaries,
and has been prepared in accordance with applicable banking regulations, rules and guidelines on a basis consistent with prior
periods, and fairly and accurately presents, in all material respects, the financial condition of the Borrower and the Financial
Institution Subsidiaries and their respective assets and liabilities and the results of their respective operations as of such
date.


 


Section
4.5.          Litigation Matters and Enforcement Actions.
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 could 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. None of the Borrower, or any of the Financial Institution Subsidiaries, or any of their
respective officers or directors, is now operating under any currently effective written restrictions agreed to by the Borrower
or any of the Financial Institution Subsidiaries, or agreements, memoranda, or written commitments by the Borrower or any of the
Financial Institution Subsidiaries (other than restrictions of general application) imposed or required by any Governmental Authority
nor are any such restrictions threatened or agreements, memoranda or commitments being sought by any Governmental Authority.


 




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Section
4.6.          Compliance with Laws and Agreements. The Borrower
and each Subsidiary is in compliance with all applicable laws (including without limitation all Environmental Laws and all federal
and state banking statutes) and all rules, regulations (including without limitation all applicable federal and state banking
regulations) and orders of any Governmental Authority, except where failure to do so could not reasonably be expected to result
in a Material Adverse Effect. Neither the Borrower nor any of the Financial Institution Subsidiaries is in material default in
the performance, observance or fulfillment of any of the terms, obligations, covenants, conditions or provisions contained in
any indenture or other agreement creating, evidencing or securing indebtedness of any kind or pursuant to which any such indebtedness
is issued, or other agreement or instrument to which the Borrower or any Financial Institution Subsidiary is a party or by which
the Borrower or any such Financial Institution Subsidiary or any of their respective properties may be bound or affected.


 


Section
4.7.          Investment Company Act. Neither the Borrower
nor any of its Subsidiaries is an “investment company”, as defined in, or subject to regulation under, the Investment
Company Act of 1940, 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
the Term Loan 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. (a)  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, could reasonably be expected to result in a Material Adverse Effect. The “benefit
obligations” of all Plans did not, as of December 31, 2012, exceed the “fair market value of the assets” of
such Plans by more than $1,000,000. No event has occurred since December 31, 2012 that would cause the “benefit obligations”
of all Plans to exceed the “fair market value of the assets” of such Plans by the dollar amount specified in the previous
sentence. The terms “benefit obligations” and “fair market value of assets” shall be determined by and
with such terms defined in accordance with Statement of Financial Accounting Standards No. 158.


 




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(b)          Each
Employee Benefit Plan is in compliance in all material respects with the applicable provisions ERISA, the Code and other applicable
law. Except with respect to Multiemployer Plans, each Qualified Plan (I) has received a favorable determination from the IRS applicable
to the Qualified Plan’s current remedial amendment cycle (as described in Revenue Procedure 2007-44 or “2007-44”
for short), (II) has timely filed for a favorable determination letter from the IRS during its staggered remedial amendment cycle
(as defined in 2007-44) and such application is currently being processed by the IRS, (III) has filed for a determination letter
prior to its “GUST remedial amendment period” (as defined in 2007-44) and received such determination letter and the
staggered remedial amendment cycle first following the GUST remedial amendment period for such Qualified Plan has not yet expired
or (IV) is maintained under a prototype or volume submitter plan and may rely upon a favorable opinion or letter issued by the
IRS with respect to such prototype or volume submitter plan. No event has occurred which would cause the loss of the Borrower’s
or any ERISA Affiliate’s reliance on the Qualified Plan’s favorable determination letter or opinion or advisory letter.


 


(c)          With
respect to any Employee Benefit Plan that is a retiree welfare benefit arrangement, all amounts have been accrued on the Borrower’s
financial statements in accordance with Statement of Financial Accounting Standards No. 106.


 


(d)          Except
as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect: (i) there are no pending
or to the best of the Borrower’s knowledge, threatened claims, actions or lawsuits or action by any Governmental Authority,
participant or beneficiary with respect to an Employee Benefit Plan; (ii) there are no violations of the fiduciary responsibility
rules with respect to any Employee Benefit Plan; and (iii) neither the Borrower nor ERISA Affiliate has engaged in a non-exempt
“prohibited transaction,” as defined in Section 406 of ERISA and Section 4975 of the Code, in connection with any Employee
Benefit Plan, that would subject the Borrower to a tax on prohibited transactions imposed by Section 502(i) of ERISA or Section
4975 of the Code.


 


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, could 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 this Agreement or any other Loan Document or delivered hereunder or thereunder
(as modified or supplemented by any other information 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 Financial Institution Subsidiary
and each other Subsidiary, in each case as of the Closing Date. All of the Capital Stock of each of the Borrower’s Subsidiaries
has been duly authorized and validly issued, and is fully paid and non-assessable. Except as set forth on Schedule 4.12,
the Borrower owns all of the issued and outstanding Capital Stock of each of its Subsidiaries free and clear of any Lien.


 




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Section
4.13.         Dividend Restrictions; Other Restrictions.
(a) Except as applicable generally to North Carolina charted commercial banks, no Financial Institution Subsidiary of the Borrower
is currently prohibited, directly or indirectly, under any order of any Governmental Authority (other than orders applicable to
bank or savings and loan holding companies and their subsidiaries generally), under any applicable law, or under any agreement
or other instrument to which it is a party or is subject, from paying any dividends to the Borrower, from making any other distribution
on such subsidiary’s Capital Stock, from repaying to the Borrower or any other Subsidiary of the Borrower any loans or advances
to such Subsidiary or from transferring any of such Subsidiary’s properties, assets or operations to the Borrower or any
other Subsidiary of the Borrower.


 


(b)          Neither
the Borrower nor any Subsidiary is under investigation by, 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 Governmental Authority, other
than routine examinations by such Governmental Authorities.


 


(c)          Except
as set forth as an exhibit to the Borrower’s Form 10-K for its fiscal year ended December 31, 2011, or its Quarterly Reports
on Form 10-Q for its Fiscal Quarter ended September 30, 2012, or described therein, neither the Borrower nor any of the Financial
Institution Subsidiaries is a party, nor is bound by, any material contract or agreement or instrument, or subject to any charter
or other corporate restriction, that is of a type that the Borrower is required to file as an exhibit to its Form 10-K annual reports
or otherwise describe therein.


 


Section
4.14.         Capital Measures. Each of Borrower and its Financial
Institution Subsidiaries is “well-capitalized” (as such term is defined at 12 C.F.R. 225.2(r) or the relevant regulation
of the Borrower’s or each of its Financial Institution Subsidiaries’ primary federal bank regulator), and “well
managed” (as that term is defined at 12 C.F.R. 225.2(s) or the relevant regulation of the Borrower’s or each of its
Financial Institutions Subsidiaries’ primary federal bank regulator), and the rating of each Financial Institution Subsidiary
under the Community Reinvestment Act of 1997 (“CRA”) is no less than “satisfactory.” Neither the
Borrower nor any Financial Institution Subsidiary has been informed that its status as “well-capitalized,” “well
managed” or, in the case of each Financial Institution Subsidiary, for CRA purposes, “satisfactory,” will change
within one (1) year.


 


Section
4.15.         Ownership of Property. (a) Each of the Borrower
and its Subsidiaries has good title to, or valid leasehold interests in, all of its real and personal property material to the
operation of its business, including all such properties reflected in the most recent audited consolidated balance sheet of the
Borrower referred to in Section 4.4 or purported to have been acquired by the Borrower or any Subsidiary after said date
(except as sold or otherwise disposed of in the ordinary course of business), in each case free and clear of Liens other than
those Liens permitted by Section 7.2. All leases that individually or in the aggregate are material to the business or
operations of the Borrower and its Subsidiaries are valid and subsisting and are in full force.


 


(b)          Each
of the Borrower and its Subsidiaries owns, or is licensed, or otherwise has the right, to use, all patents, trademarks, service
marks, trade names, copyrights and other intellectual property material to its business, and the use thereof by the Borrower and
its Subsidiaries does not infringe in any material respect on the rights of any other Person.


 




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(c)          The
properties of the Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies which are
not Affiliates of the Borrower, in such amounts with such deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where the Borrower or any applicable Subsidiary operates.


 


Section
4.16.         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) (such laws and regulations collectively referred
to herein as “Anti-Terrorism Laws”). 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.


 


Section
4.17.         Solvency. After giving effect to the execution and
delivery of the Loan Documents and the making of the Term Loan under this Agreement, neither the Borrower nor its Subsidiaries
will be “insolvent,” within the meaning of such term as defined in § 101(32) of Title 11 of the United States
Code, as amended from time to time, or be unable to pay its debts generally as such debts become due, or have an unreasonably
small capital to engage in any business or transaction, whether current or contemplated (“Solvent”).


 


Section
4.18.         Labor Relations. There are no strikes, lockouts or
other material labor disputes or grievances against the Borrower or any Subsidiary, or, to the Borrower’s knowledge, threatened
against or affecting the Borrower or any Subsidiary, and no significant unfair labor practice, charges or grievances are pending
against the Borrower or any Subsidiary, or to the Borrower’s knowledge, threatened against any of them before any Governmental
Authority. All payments due from the Borrower or any Subsidiary pursuant to the provisions of any collective bargaining agreement
have been paid or accrued as a liability on the books of the Borrower or such Subsidiary, except where the failure to do so could
not reasonably be expected to have a Material Adverse Effect.


 


Section
4.19.         Regulatory Matters. Neither the Borrower nor
any of its Financial Institution Subsidiaries is subject or is party to, or has received any notice or advice that any of them
may become subject or party to any investigation with respect to, any corrective, suspension or cease-and-desist order, agreement,
consent agreement, memorandum of understanding or other regulatory enforcement action, proceeding or order with or by, or is a
party to any commitment letter or similar undertaking to, or is subject to any directive by, or has been a recipient of any supervisory
letter from, or has adopted any board resolutions at the request of, any Governmental Authority that currently relates to or restricts
in any material respect the conduct of their business or that in any manner relates to their capital adequacy, credit policies,
management or business (each, a “Regulatory Agreement”), nor has the Borrower or any of its Financial Institution
Subsidiaries been advised by any Governmental Authority that it is considering issuing or requesting any Regulatory Agreement.
There is no unresolved violation, criticism or exception by any Governmental Authority with respect to any report or statement
relating to any examinations of the Borrower or any of its Financial Institution Subsidiaries. The Borrower and its Financial
Institution Subsidiaries are in compliance in all material respects with all laws administered by any Governmental Authority.


 




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Section
4.20.         SEC Reports. The Borrower has timely filed with or
furnished to, as applicable, the Securities and Exchange Commission (the “SEC”) all registration statements,
prospectuses, reports, schedules, forms, statements and other documents (including exhibits and all other information incorporated
by reference) required to be filed or furnished by it with the SEC since January 1, 2010 (the “Borrower SEC Documents”).
The Borrower has made available to the Lender all such Borrower SEC Documents that it has so filed or furnished prior to the date
hereof. As of their respective filing dates (or, if amended or superseded by a subsequent filing, as of the date of the last such
amendment or superseding filing prior to the date hereof), each of the Borrower SEC Documents complied as to form in all material
respects with the applicable requirements of the Securities Act and Exchange Act applicable to such Borrower SEC Documents. None
of the Borrower SEC Documents, including any financial statements, schedules or exhibits included or incorporated by reference
therein at the time they were filed or furnished (or, if amended or superseded by a subsequent filing, as of the date of the last
such amendment or superseding filing prior to the date hereof), contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. None of the Borrower’s Subsidiaries is required to file with or furnish to the
SEC any forms, reports or other documents.


 


Section
4.21.         Accounting Controls and Disclosure Controls. The
Borrower and each of its Subsidiaries maintain effective internal control over financial reporting (as defined under Rule 13-a15
and 15d-15 of the 1934 Act Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances
that: (A) transactions are executed in accordance with management’s general or specific authorization; (B) transactions
are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability
for assets; (C) access to assets is permitted only in accordance with management’s general or specific authorization; (D)
the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is
taken with respect to any differences; and (E) any interactive data in eXtensible Business Reporting Language included in the
Borrower’s SEC filings fairly presents the required information and is prepared in accordance with the SEC’s rules
and guidelines applicable thereto. Since the end of the Borrower’s most recent audited fiscal year, there has been (1) no
material weakness in the Borrower’s internal control over financial reporting (whether or not remediated) and (2) no change
in the Borrower’s internal control over financial reporting that has materially affected, or is reasonably likely to materially
affect, the Borrower’s internal control over financial reporting. The Borrower and each of its Subsidiaries maintain an
effective system of disclosure controls and procedures (as defined in Rule 13a-15 and Rule 15d-15 of the 1934 Act Regulations)
that are designed to ensure that the information required to be disclosed by the Borrower in the reports that it files or submits
under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules
and forms, and is accumulated and communicated to the Borrower’s management, including its principal executive officer or
officers and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure. Each of
the principal executive officer and the principal financial officer of the Borrower (or each former principal executive officer
and each former principal financial officer of the Borrower, as applicable) has made all certifications required by Rule 13a-14
or 15d-14 under the Exchange Act and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 (including the rules and regulations
promulgated thereunder, the “Sarbanes-Oxley Act”) with respect to the Borrower SEC Documents, and the statements
contained in such certifications are true and accurate in all material respects. For purposes of this Agreement, “principal
executive officer” and “principal financial officer” shall have the meanings given to such terms in the Sarbanes-Oxley
Act. Neither the Borrower nor any of its Financial Institution Subsidiaries has outstanding (nor has arranged or modified since
the enactment of the Sarbanes-Oxley Act) any “extensions of credit” (within the meaning of Section 402 of the Sarbanes-Oxley
Act) to directors or executive officers (as defined in Rule 3b-7 under the Exchange Act) of the Borrower or any of its Financial
Institution Subsidiaries. The Borrower is otherwise in compliance with all applicable provisions of the Sarbanes-Oxley Act, except
for any non-compliance that would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.


 




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Section
4.22.         Foreign Corrupt Practices Act. None of the Borrower,
nor any of its Financial Institution Subsidiaries or, to the knowledge of the Borrower, any director, officer, agent, employee,
affiliate or other person acting on behalf of the Borrower or any of its subsidiaries is aware of or has taken any action, directly
or indirectly, that would result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and
the rules and regulations thereunder (the “FCPA”), including, without limitation, making use of the mails or
any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization
of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to
any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or
any candidate for foreign political office, in contravention of the FCPA and the Borrower, its subsidiaries and, to the knowledge
of the Borrower, its other affiliates have conducted their businesses in compliance with the FCPA and have instituted and maintain
policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.


 


Section
4.23.         Money Laundering Laws. The operations of the Borrower
and its Subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all
jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered
or enforced by any Governmental Authority (collectively, the “Money Laundering Laws”). No action, suit or proceeding
by or before any Governmental Authority involving the Borrower or any of its Subsidiaries with respect to the Money Laundering
Laws is pending or, to the best knowledge of the Borrower, threatened.


 




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Section
4.24.         OFAC. None of the Borrower, any of its Subsidiaries
or, to the knowledge of the Borrower, any director, officer, agent, employee, affiliate or other person acting on behalf of the
Borrower or any of its subsidiaries is (A) a currently the subject or target of any sanctions administered or enforced by the
United States Government, including, without limitation, the U.S. Department of the Treasury’s Office of Foreign Assets
Control (“OFAC”), the United Nations Security Council, the European Union, Her Majesty’s Treasury, or
other relevant sanctions authority (collectively, “Sanctions”) or (B) located, organized or resident in a country
or territory that is the subject of Sanctions.


 


Article
V      AFFIRMATIVE COVENANTS


 


The Borrower covenants
and agrees that so long as any principal of and interest on the Term Loan or any fee or other obligation owing hereunder 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 and consolidating balance sheet
and the related consolidated and consolidating 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 Cherry, Bekaert & Holland, L.L.P. 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 and consolidating 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; provided, that the requirements set forth in this clause
(a), other than the certification of the Borrower’s certified public accountants set forth in clause (ii) above, may be fulfilled
by providing to the Lender the report of the Borrower to the SEC on Form 10-K for the applicable fiscal year;


 


(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 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, 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 chief financial officer or treasurer 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 in accordance with GAAP, subject
to normal year-end audit adjustments and the absence of footnotes; provided, that the requirements set forth in this clause
(b) with respect to the financial information of the Borrower and its Subsidiaries on a consolidated and consolidating basis
may be fulfilled by providing to the Lender the report of the Borrower to the SEC on Form 10-Q for the applicable fiscal quarter;


 




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(c)          concurrently
with the delivery of the financial statements referred to in clauses (a) and (b) above, a Compliance Certificate, (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 Y-9C Report and FR Y-9LP Report and a duly executed copy of the then-current Call Report for each Financial Institution
Subsidiary and each such report so filed by the Borrower or the Financial Institution Subsidiaries with any Governmental Authority
shall be true and correct and is in accordance with the respective books of account and records of the Borrower and the Financial
Institution Subsidiaries, and will be prepared in accordance with applicable banking regulations, rules and guidelines on a basis
consistent with prior periods, and fairly and accurately presents, in all material respects, the financial condition of the Borrower
and the Financial Institution Subsidiaries and their respective assets and liabilities and the results of their respective operations
as of such date;


 


(e)          as
soon as available and in any event within 60 days after the first day of each fiscal year of the Borrower, (i) a budget prepared
on a consolidated and quarterly basis in reasonable detail (including budgeted income statements, statements of cash flow and balance
sheets and the principal assumptions upon which such budgets are based) prepared by the Borrower for such fiscal year and (ii)
projected consolidated and consolidating financial statements (including in each case, forecasted balance sheets and statements
of income and statements of cash flow) for each fiscal quarter in such fiscal year, in each case, in form and content reasonably
acceptable to the Lender, together with such supporting information as the Lender may reasonably request;


 


(f)          promptly
after the same become publicly available, copies of all periodic and other reports, financial statements, registration statements,
proxy statements and other materials, together with any amendments or exhibits relating to any of the foregoing, filed with the
SEC, or any Governmental Authority succeeding to any or all functions of the SEC, or with any national securities exchange, or
distributed by the Borrower to its public security holders generally, as the case may be (to the extent not otherwise required
to be delivered to the Lender hereunder);


 


(g)          promptly
after receiving knowledge thereof, written notice of all material charges, material assessments, actions, suits and proceedings
(as well as notice of the outcome of any such charges, assessments, orders, actions, suits and proceedings) that are proposed or
initiated by, or brought before, any court or Governmental Authority, in connection with the Borrower or any of the Financial Institution
Subsidiaries, other than ordinary course of business litigation or proceedings which, if adversely decided, could not reasonably
be expected to have a Material Adverse Effect;


 




    	- 38 -



    	 



    

 


(h)          promptly,
and in any event within five Business Days after the execution or entry thereof, the execution or entry by the Borrower or any
Financial Institution Subsidiary of any Regulatory Agreement, together with a copy thereof if such disclosure is permitted by applicable
law; and


 


(i)          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.


 


Documents required to
be delivered pursuant to Section 5.1(a) or (b) or Section 5.1(f) (to the extent any such documents are included
in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered
on the date (i) on which the Borrower posts such documents or provides a link thereto on the Borrower’s website on the
internet at the website address set forth in Section 9.1 or (ii) on which such documents are posted on the Borrower’s
behalf on an internet or intranet website, if any, to which the Lender have access; provided, that (A) the Borrower
shall deliver paper copies of such documents to the Lender if so requested until a written notice is received by the Borrower from
the Lender to cease delivering paper copies and (B) the Borrower shall notify (which may be by telex, telefacsimile or electronic
mail) the Lender of the posting of any such documents and provide to the Lender by electronic mail electronic versions (i.e. soft
copies) of such documents. Notwithstanding anything contained herein, in every instance the Borrower shall be required to provide
paper copies of all Compliance Certificates.


 


The Borrower and each
of its Subsidiaries maintain effective internal control over financial reporting (as defined under Rule 13-a15 and 15d-15 of the
1934 Act Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances that: (A) transactions
are executed in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to
assets is permitted only in accordance with management’s general or specific authorization; (D) the recorded accountability
for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences;
and (E) any interactive data in eXtensible Business Reporting Language included in the Borrower’s SEC filings fairly presents
the required information and is prepared in accordance with the SEC’s rules and guidelines applicable thereto. The Borrower
and each of its Subsidiaries shall maintain an effective system of disclosure controls and procedures (as defined in Rule 13a-15
and Rule 15d-15 of the 1934 Act Regulations) that are designed to ensure that the information required to be disclosed by the Borrower
in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods
specified in the SEC’s rules and forms, and is accumulated and communicated to the Borrower’s management, including
its principal executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions
regarding disclosure.


 




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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 or its Subsidiaries in an aggregate amount exceeding $1,000,000;


 


(d)          any
material investigation of the Borrower or any Subsidiary by any Governmental Authority having regulatory authority over the Borrower
or any such Subsidiary (other than routine examinations of the Borrower and/or any such Subsidiary) to the extent that such Governmental
Authority has consented to the giving of such notice (if the consent of such Governmental Authority is required for the Borrower
to give such notice);


 


(e)          the
issuance of any cease and desist order (whether written or oral), execution and delivery of any Regulatory Agreement (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)), 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 material informal enforcement action, including, without limitation, a 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); and


 


(g)          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.


 




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Section
5.4.          Compliance with Laws, Etc..


 


(a)          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, could not reasonably be expected to result in a Material Adverse
Effect. In this connection, each of the Borrower and its Subsidiaries shall comply, in all material respects, with (i) all
Anti-Terrorism Laws; (ii) all Money Laundering Laws, and (iii) the FCPA or other laws or regulations referenced in Section 4.22
hereof.


 


(b)          The
Borrower shall timely file with or furnished to, as applicable, the SEC all Borrower SEC Documents required to be filed by it during
the term of this Agreement in accordance with all rules and regulations promulgated from time to time by the SEC. The Borrower
shall at all times be in compliance with the Sarbanes-Oxley Act and related rules and regulations referenced in Section 4.21
hereof.


 


Section
5.5.          Payment of Obligations. The Borrower will, and
will cause each of its Subsidiaries to, pay and discharge at or before maturity, all of its obligations and liabilities (including
without limitation all tax liabilities and all claims that could result in a statutory Lien) before the same shall become delinquent
or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b)
the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and
(c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect.


 


Section
5.6.          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
and consolidating financial statements of the Borrower in conformity with GAAP.


 


Section
5.7.          Visitation, Inspection, Etc. The Borrower will,
and will cause each of its Subsidiaries to, permit any representative of the Lender to, subject to Section 9.11, 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 its officers and with its independent certified public accountants, all at such reasonable
times and as often as the Lender may reasonably request after reasonable prior notice to the Borrower and at the Borrower’s
expense.


 


Section
5.8.          Maintenance of Properties; Insurance.


 


(a)          The
Borrower will, and will cause each of its Subsidiaries to, keep and maintain all property material to the conduct of its business
in good working order and condition, except for ordinary wear and tear and except where the failure to do so, either individually
or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.


 




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(b)          The
Borrower will, and will cause each of its Subsidiaries to, keep and 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.


 


(c)          The
deposits of each Financial Institution Subsidiary will at all times be insured by the FDIC.


 


Section
5.9.          Use of Proceeds. The Borrower will use the proceeds
of the Term Loan solely to redeem a portion of the Borrower’s Series A Perpetual Preferred Stock and to pay out-of-pocket
costs and expenses incurred in connection with the consummation of the financing transactions contemplated hereby, including,
without limitation, the fees and expenses of counsel to the Borrower and the Lender.


 


Section
5.10.         Further Assurances. The Borrower agrees, upon request
of the Lender, to execute and deliver or cause to be executed and delivered such further instruments, documents and certificates,
and to and cause to be done such further acts that may be reasonably necessary or advisable in the reasonable opinion of the Lender
to carry out more effectively the provisions and purposes of this Agreement and the other Loan Documents.


 


Article
VI     FINANCIAL COVENANTS


 


The Borrower covenants
and agrees that so long as any principal of, and interest on, the Term Loan, or any fee or other obligation owing hereunder remains
unpaid:


 


Section
6.1.          Regulatory Capital.


 


(a)          The
Borrower will, at all times, be “well-capitalized” for all applicable state and federal regulatory purposes, and the
Borrower:


 


(i)          will
maintain (A) a Total Risk-based Capital Ratio of 10.50% or greater, (B) a Tier 1 Common Capital Ratio of 8.50% or greater, (C)
a Tier 1 Risk-based Capital Ratio of 8.50% or greater, and (D) a Leverage Ratio of 7.25% or greater (as defined from time to time
under each federal regulation or order applicable to, or binding upon, the Borrower);


 


(ii)         will
not be subject to any written agreement, order, capital directive or prompt corrective action directive by any Governmental Authority
having regulatory authority over the Borrower; and


 


(iii)        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.


 




    	- 42 -



    	 



    

 


(b)          Each
Financial Institution Subsidiary of the Borrower will, at all times, be “well capitalized” for all applicable state
and federal regulatory purposes, and such Financial Institution Subsidiary:


 


(i)          will
maintain (A) a Total Risk-based Capital Ratio of 10.50% or greater, (B) a Tier 1 Common Capital Ratio of 8.50% or greater, (C)
a Tier 1 Risk-based Capital Ratio of 8.50% or greater, and (D) a Leverage Ratio of 7.25% or greater (as defined from time to time
under each federal and state regulation or order applicable to, or binding upon, such Financial Institution Subsidiary);


 


(ii)         will
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; and


 


(iii)        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”,
as applicable to the Borrower or any Financial Institution Subsidiary of the Borrower, either by amending such ratios, standards
or otherwise, in each case, in a manner more onerous or restrictive to the Borrower or such Financial Institution Subsidiary than
the capital and other ratios required to be maintained pursuant to paragraphs (a) and (b) above, such amended definition, and any
such amended or new ratios or new standards, shall automatically, and in lieu of the existing definitions and ratios set forth
in this Section, 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 any principal of and interest on the Term Loan or any fee or other obligation owing hereunder remains
unpaid:


 


Section
7.1.          Indebtedness. Without the prior written consent
of the Lender, which consent shall not be unreasonably delayed, denied or withheld, 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
of the Borrower 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;


 




    	- 43 -



    	 



    

 


(c)          Permitted
Financial Institution Subsidiary Indebtedness;


 


(d)          (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; and


 


(e)          Purchase
money indebtedness and Capitalized Lease Obligations secured by Liens permitted under this Agreement in an aggregate amount outstanding
at any time not to exceed $500,000.


 


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 including the Bank of North Carolina), except:


 


(a)          Liens
(if any) created in favor of the Lender;


 


(b)          Permitted
Encumbrances;


 


(c)          Liens
on property of the Borrower or any of its Subsidiaries created solely for the purpose of securing Indebtedness expressly permitted
by Section 7.1(e), representing or incurred to finance, refinance or refund the purchase price of property; provided,
that no such Lien shall extend to or encumber other property of the Borrower or such Subsidiary other than the respective property
so acquired, and the principal amount of Indebtedness secured thereby shall at no time exceed the original purchase price of such
property; and


 


(d)          extensions,
renewals, or replacements of any Lien referred to in paragraphs (a), (b) and (c) of this Section; provided, that the principal
amount of the Indebtedness secured thereby is not increased in any manner that would exceed the amounts permitted in Section
7.1 and that any such extension, renewal or replacement is limited to the assets originally encumbered thereby.


 


Notwithstanding anything
herein or otherwise to the contrary, the Borrower shall not grant any Lien, or otherwise permit any Lien to exist, on the Capital
Stock of any Financial Institution Subsidiary (other than Liens in favor of the Lender).


 




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Section
7.3.          Fundamental Changes.


 


(a)          The
Borrower will not, and will not permit any Subsidiary to, (i) merge into or consolidate into any other Person, or permit any
other Person to merge into or consolidate with it, or (ii) sell, lease, transfer or otherwise dispose of (in a single transaction
or a series of transactions) all or a material portion of its assets or all or substantially all of the stock of any of its Subsidiaries
or (iii) liquidate or dissolve; provided, that if at the time thereof and immediately after giving effect
thereto on a pro forma basis, no Default or Event of Default shall have occurred, (A)(i) the Borrower may merge with a Person
in connection with a Permitted Acquisition; provided, that, the Borrower shall be the surviving Person, (ii) a Subsidiary
may merge with a Person in connection with a Permitted Acquisition; provided, that, the Subsidiary shall be the surviving
Person, or (iii) a Subsidiary may merge with another Subsidiary, so long as a Subsidiary shall be the surviving Person, (B) any
Subsidiary may sell, lease, transfer or dispose of its assets to the Borrower or another Subsidiary, (C) the Borrower or any
Financial Institution Subsidiary may sell loans, investments, or other similar assets in the ordinary course of its business, provided,
that such sale or series of sales do not constitute a sale of all or a material portion of such Financial Institution Subsidiary’s
assets, and (D) the Borrower and any Subsidiary may sell any Other Real Estate Owned; provided, further, that,
in the case of clauses (C) and (D) hereof, no single sale (or series of related sales) shall exceed $200,000,000 of assets (calculated,
in the case of loans, by the unpaid principal balance thereof, and, in the case of Other Real Estate Owned or other assets, the
greater of (x) the fair market value thereof or (y) the purchase price thereof).


 


(b)          The
Borrower will not dispose of any Capital Stock in any of its Financial Institution Subsidiaries, whether by sale, assignment, lease
or otherwise, without the prior written consent of the Lender.


 


(c)          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. 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, prepayment or other acquisition of, (a) any shares of Capital Stock or (b) Indebtedness
subordinated to the Obligations of the Borrower or (c) any options, warrants, or other rights to purchase such Capital Stock or
such Indebtedness, whether now or hereafter outstanding (each a “Restricted Payment”); provided,
however, that (i) any Subsidiary may make Restricted Payments to the Borrower at any time, (ii) the Borrower may pay dividends
payable solely in shares of any class of its common stock, (iii) the Borrower shall be permitted to pay, in cash, in each Fiscal
Quarter of the Borrower occurring during the period this Agreement is in effect, its regular quarterly dividend of $0.05 per common
share; provided, however, that in no event, including in the event of any stock split or additional issuance of
common shares or otherwise occurring after the date hereof, shall the aggregate amount of cash dividends paid in respect of its
common shares exceed $6,000,000 per Fiscal Year and (iv) the Borrower may, from time to time during the term of this Agreement,
redeem or repurchase shares of the Capital Stock of the Borrower so long as (A) at the time of the making of such redemption or
repurchase, no Default or Event of Default then exists and is continuing; (B) the Borrower is, after giving pro forma effect
to such redemption or repurchase, in compliance with the covenants set forth in Section 6.1; and (c) the aggregate amount
of such Restricted Payments that the Borrower may make under clause (iv) above shall not exceed $25,000,000 during the term of
this Agreement.


 




    	- 45 -



    	 



    

 


Section
7.5.          Restrictive Agreements. Without the prior written
consent of Lender, which consent shall not be unreasonably delayed, denied or withheld, the Borrower will not, and will not permit
any of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement that prohibits, restricts
or imposes any condition upon  the ability of the Borrower or any Subsidiary to (a) create, incur or permit any Lien upon
any of its assets or properties, whether now owned or hereafter acquired, or (b) pay dividends or make any other distributions
on any of such Subsidiary’s Capital Stock owned by the Borrower or any other Subsidiary of the Borrower, repay or prepay
any Indebtedness owed by such Subsidiary to the Borrower or any other Subsidiary of the Borrower, make loans or advances to the
Borrower or any other Subsidiary of the Borrower, guarantee Indebtedness of the Borrower or any other Subsidiary or transfer,
lease or license any of its property or assets to the Borrower or any Subsidiary of the Borrower including, but not limited to,
any such restriction referenced in Section 4.13(a) hereof; provided, that (i) clause (a) shall not prohibit:
(x) customary provisions in leases restricting the assignment thereof and (y) restrictions in agreements evidencing purchase money
Indebtedness permitted by Section 7.1(h) that impose restrictions on the property so acquired, and (ii) clause (b)
shall not prohibit: (x) restrictions or conditions imposed by law or by this Agreement or any other Loan Document, or (y) 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.


 


Section
7.6.          Investments, Etc. Without the prior written
consent of Lender, which consent shall not be unreasonably delayed, denied or withheld, 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 Capital 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, or purchase or otherwise acquire (in one transaction
or a series of transactions) all or substantially all of the assets of a Person, or of any business or division of any Person
(all of the foregoing being collectively called “Investments”), except:


 


(a)          Investments
existing on the date hereof (including Investments in Subsidiaries) and set forth on Schedule 7.6(a).


 


(b)          Investments
purchased by any Financial Institution Subsidiary in connection with its asset management in ordinary course of business;


 


(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)          Permitted
Acquisitions;


 


(e)          Investments
received in consideration for Asset Sales in a form other than Cash to the extent expressly permitted by Section 7.3;


 




    	- 46 -



    	 



    

 


(f)          Guarantees
of the Borrower of any Indebtedness expressly permitted under Section 7.1(d); and


 


(g)          Investments
constituting Permitted Financial Institution Subsidiary Indebtedness.


 


Section
7.7.          Transactions with Affiliates. The Borrower will
not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase,
lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates,
except (a) in the ordinary course of business at prices and on terms and conditions not less favorable to the Borrower or such
Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties, (b) if such transaction with an
Affiliate involves an amount in excess of $1,000,000, a transaction in which a majority of the disinterested directors on the
Board of Directors of the Borrower or such Subsidiary have approved the relevant transaction as evidenced by a resolution of the
Board of Directors of the Borrower or such Subsidiary, (c) transactions between or among the Borrower and any Subsidiary not involving
any other Affiliates and (d) any Restricted Payment expressly permitted by Section 7.4.


 


Section
7.8.          Hedging Transactions. The Borrower will not,
and will not permit any of the Subsidiaries to, enter into any Hedging Transaction, other than Hedging Transactions entered into
in the ordinary course of business to hedge or mitigate risks to which the Borrower or any Subsidiary is exposed in the conduct
of its business or the management of its liabilities. Solely for the avoidance of doubt, the Borrower acknowledges that a Hedging
Transaction entered into for speculative purposes or of a speculative nature (which shall be deemed to include any Hedging Transaction
under which the Borrower or any of the Subsidiaries is or may become obliged to make any payment (i) in connection with the purchase
by any third party of any Capital Stock or any Indebtedness or (ii) as a result of changes in the market value of any Capital
Stock or any Indebtedness) is not a Hedging Transaction entered into in the ordinary course of business to hedge or mitigate risks.


 


Section
7.9.          Amendment to Material Documents. The Borrower
will not, and will not permit any of its Subsidiaries to, amend, modify or waive any of its rights in any manner that is adverse
to the interests of the Lender or the Borrower or any of its Subsidiaries under such party’s certificate of incorporation,
bylaws or other organizational documents.


 


Section
7.10.         Sale and Leaseback Transaction. The Borrower will
not, and will not permit any of its 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.


 


Section
7.11.         Accounting Changes. The Borrower will not, and will
not permit any of its Subsidiaries to, make any significant change in accounting treatment or reporting practices, except as required
by GAAP, or change the fiscal year of the Borrower or any Subsidiary of the Borrower, except to change the fiscal year of a Subsidiary
of the Borrower to conform its fiscal year to that of the Borrower.


 




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Section
7.12.         Unsafe and Unsound Practices. The Borrower will not,
and will not permit any of its Subsidiaries to, engage in any unsafe or unsound business practice that has been identified as
such by the FRB and/or the FDIC or other Governmental Authority having jurisdiction over the Borrower or such Subsidiary or that
could otherwise reasonably be expected to have a Material Adverse Effect.


 


Section
7.13.         Most Favored Lender Status. The Borrower will not,
and will not permit any of its Subsidiaries to, enter into, amend or modify documents evidencing or governing Indebtedness to
which the Borrower or its Subsidiaries are bound, that contain, or are amended and modified to contain, one or more Additional
Covenants or Additional Defaults, unless in each case the Borrower or such Subsidiary contemporaneously executes an amendment
to this Agreement, in form and substance reasonably satisfactory to the Lender, to include such Additional Covenants or Additional
Defaults herein; provided, that to the extent that the Borrower or any Subsidiary shall enter into, assume or otherwise
become bound by or obligated under such amendment or agreement containing one or more Additional Covenants or Additional Defaults
without amending this Agreement to include such Additional Covenants or Additional Defaults, the terms of this Agreement shall
nonetheless, without any further action on the part of the Borrower or any Subsidiary, be deemed or amended automatically to include
each Additional Covenant and each Additional Default contained in such amendment or agreement. 


 


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 the Term Loan when and as the same shall become due and payable, whether at the due
date thereof or otherwise; or


 


(b)          the
Borrower shall fail to pay any interest on the Term Loan or any fee or any other Obligation (other than an amount payable under
clause (a) of this Article), 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 or any other Loan Document 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 5.1, Section 5.2, Section
5.3 (with respect to the Borrower’s existence), Section 5.7, Section 5.9 or Article VI or Article
VII; or


 




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(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 (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 Indebtedness (other
than under this Agreement or the Term Note) owed to any Lender or to any other Person, in each case, in an amount greater than
$1,000,000 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 (and for purposes of determining the amount of attributed Indebtedness
under this clause (f) from Hedging Obligations, the “principal amount” of any Hedging Obligations at any time shall
be the Net Mark-to-Market Exposure of such Hedging Obligations); 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)          without
duplication of clause (f) of this Section 8.1, 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


 




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(j)          an
ERISA Event shall have occurred that, in the opinion of the Lender, when taken together with other ERISA Events that have occurred,
could reasonably be expected to result in liability to the Borrower and the Subsidiaries in an aggregate amount exceeding $1,000,000;
or


 


(k)          any
judgment or order for the payment of money in excess of $1,000,000 in the aggregate not covered by insurance and for which
the applicable insurer shall have acknowledged in writing that such claim or payment is insured 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 could 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


 


(n)          any
Governmental Authority having regulatory authority over the Borrower or any Subsidiary shall take any action that restricts, or
has the practical effect of restricting, the payment of dividends from any such Subsidiary to the Borrower or the payment of any
debt owing by a Subsidiary to the Borrower; or


 


(o)          any
Financial Institution Subsidiary shall cease for any reason (other than as a result of being merged into another Financial Institution
Subsidiary) to be an insured bank under the Federal Deposit Insurance Act, as amended; or


 


(p)          the
FRB, the FDIC or any other Governmental Authority charged with the regulation of bank holding companies or depository institutions:
(i) issues (whether orally or in writing) to the Borrower or any Financial Institution Subsidiary, or initiates through formal
proceedings any action, suit or proceeding to obtain against, impose on or require from the Borrower or any Financial Institution
Subsidiary, a cease and desist order or similar regulatory order, the assessment of civil monetary penalties, articles of agreement,
a memorandum of understanding, a capital directive, a capital restoration plan, restrictions that prevent or as a practical matter
impair the payment of dividends by any Financial Institution Subsidiary or the payments of any debt by the Borrower, restrictions
that make the payment of the dividends by any Financial Institution Subsidiary or the payment of debt by the Borrower subject to
prior regulatory approval, a notice or finding under subsection 8(a) of the Federal Deposit Insurance Act, as amended, or any similar
enforcement action, measure or proceeding; or (ii) proposes or issues (whether orally or in writing) to any executive officer or
director of the Borrower or any Financial Institution Subsidiary, or initiates any action, suit or proceeding to obtain against,
impose on or require from any such officer or director, a cease and desist order or similar regulatory order, a removal order or
suspension order, or the assessment of civil monetary penalties; or


 




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(q)          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 a conservator or receiver is appointed
for any Financial Institution Subsidiary; or


 


(r)          any
order or decree is entered by any court of competent jurisdiction directly or indirectly enjoining or prohibiting the Lender or
the Borrower from performing any of their respective obligations under this Agreement or under any of the other Loan Documents
and such order or decree is not vacated, and the proceedings out of which such order or decree arose are not dismissed, within
60 days after the granting of such decree or order; or


 


(s)          the
Borrower or any Financial Institution Subsidiary (i) shall enter into any Regulatory Agreement or is otherwise operating under
any restrictions imposed by or agreed to with, any Governmental Authority, other than routine examinations by such Governmental
Authorities or (ii) shall be declared by any Governmental Authority as not being Solvent; or


 


(t)          the
filing of formal charges by any Governmental Authority or quasi-governmental entity, including, without limitation, the issuance
of an indictment under a RICO Related Law against Borrower or any Subsidiary of Borrower; or


 


(u)          the
failure of the common shares of the Capital Stock of the Borrower to be listed for trading on either the New York Stock Exchange
or the NASDAQ Global Market Exchange;


 


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) declare the principal of and any accrued interest on the Term Loan, 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 (ii) 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 principal of the Term Loan
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 telexed or sent by telefacsimile, as follows:


 




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	To the Borrower:	BNC Bancorp
	 	3980 Premier Drive
	 	Suite 210
	 	High Point, North Carolina 27265
	 	Attn:  Richard D. Callicutt II
	 	Telephone Number:	(336) 869-9200
	 	Fax Number:	(336) 889-8451
	 	Website:	www.bankofnc.com
	 	 
	 	with a copy to
	 	 
	 	BNC Bancorp/Bank of North Carolina
	 	3980 Premier Drive
	 	Suite 210
	 	High Point, North Carolina 27265
	 	Attn:  Drema A. Michael
	 	 
	 	with a copy to
	 	 
	 	Womble Carlyle Sandridge & Rice, LLP
	 	271 17th Street, N.W.
	 	Suite 2400
	 	Atlanta, Georgia 30363-1017
	 	Attn:  Carolyn Saffold Wilson
	 	Telephone Number:   (404) 888-7487
	 	Email:   cwilson@wcsr.com
	 	 
	To the Lender:	Synovus Bank
	 	3280 Peachtree Road, NE
	 	Suite 500
	 	Atlanta, Georgia 30305
	 	Attn:  Michael Sawicki
	 	Telephone Number:   (678) 578-1927
	 	Email:   MichaelSawicki@synovus.com
	 	 
		with a copy to
	 	 
	 	Synovus Bank
	 	3280 Peachtree Road, NE
	 	Suite 500
	 	Atlanta, Georgia 30305
	 	Attn:  Vickie Summey
	 	Telephone Number:   (678) 784-7157
	 	Email:   vickiesummey@synovus.com


 




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	 	with a copy to
	 	 
	 	Alston & Bird LLP
	 	1201 West Peachtree Street
	 	Atlanta, Georgia 30309
	 	Attn: Richard W. Grice
	 	Telephone Number:  (404) 881-7576
	 	Email:  richard.grice@alston.com










 


Any party
hereto may change its address or telefacsimile 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, be effective when delivered for
overnight (next-day) delivery or, when telexed, sent by telefacsimile, or other electronic transmission (in .pdf format), be effective
when transmitted in legible form by telefacsimile machine or other electronic transmission (in .pdf format) or if mailed, upon
the third Business Day after the date deposited into the mail 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, telex, telefacsimile or other electronic transmission (in
..pdf format) 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, telex,
telefacsimile or electronically transmitted notice. The obligation of the Borrower to repay the Term Loan 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, telex or telefacsimile 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, telex or telefacsimile 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 the Term 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.


 




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(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. Notwithstanding
anything herein or otherwise to the contrary, any Event of Default occurring hereunder shall continue to exist (and shall be deemed
to be continuing) until such time as such Event of Default is waived in writing in accordance with the terms of this Section notwithstanding
(i) any attempted cure or other action taken by the Borrower or any other Person subsequent to the occurrence of such Event of
Default or (ii) any action taken or omitted to be taken by the Lender prior to or subsequent to the occurrence of such Event of
Default (other than the granting of a waiver in writing in accordance with the terms of this Section).


 


Section
9.3.          Expenses; Indemnification.


 


(a)          The
Borrower shall pay (i) all reasonable, out-of-pocket costs and expenses of the Lender and its Affiliates (including, without
limitation, the reasonable fees, charges and disbursements of outside counsel and the allocated cost of inside counsel for the
Lender and its Affiliates) in connection with the syndication of the Term Loan provided for herein, 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 Term Loan made hereunder, including all such out-of-pocket expenses incurred during
any workout, restructuring or negotiations in respect of the Term Loan.


 


(b)          The
Borrower shall indemnify the Lender and each officer, director, employee, agents, advisors and Affiliates 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 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 any this Agreement or any other Loan Document, the performance by the parties
hereto of their respective obligations hereunder or the consummation of any of the transactions contemplated hereby, (ii) the
Term Loan or any actual or proposed use of the proceeds therefrom, (iii) the use by any Person of any information or materials
obtained by or through SyndTrak or other internet web sites, (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 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.


 




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(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, 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 by the Borrower 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, the Term Loan or the use of proceeds thereof.


 


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


 


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 permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of the Lender, and the Lender may not assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an assignee in accordance with the provisions of paragraph (b) of this Section, (ii) by way of participation
in accordance with the provisions of paragraph (d) of this Section or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of paragraph (g) of this Section (and any other attempted assignment or transfer by any party hereto
shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in paragraph (d)
of this Section and, to the extent expressly contemplated hereby, the Lender and its affiliates) any legal or equitable right,
remedy or claim under or by reason of this Agreement.


 


(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 (including
all or a portion of its Term Loan Commitment and Term Loan at the time owing to it, in each case, without the consent or notice
to, the Borrower); provided, however, that no such assignment shall be made to the Borrower or any of the Borrower’s
Affiliates or Subsidiaries or to a natural person.


 




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(c)          The
Lender, acting solely for this purpose as an agent of the Borrower, shall maintain at the Principal Office a copy of each Assignment
and Assumption delivered to it and a register for the recordation of the names and addresses of any new lender, and the Commitment
of, and principal amounts of the Term Loan owing to, the Lender(s) pursuant to the terms hereof from time to time (the “Register”).
The entries in the Register shall be conclusive, and the Borrower and the Lender may treat each Person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to
time upon reasonable prior notice.


 


(d)          The
Lender may, at any time, without the consent of, or notice to, the Borrower, sell participations to any Person (other than a natural
person or the Borrower or any Subsidiary of the Borrower or Affiliate of the Borrower) (each, a “Participant”)
in all or a portion of the Lender’s rights and/or obligations under this Agreement (including, all or a portion of its Term
Loan Commitment and/or the Term Loan owing to it); 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
such obligations 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. Any agreement or instrument pursuant to which the Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification
or waiver of any provision of this Agreement; provided, that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment, modification or waiver that would (i) postpone any date upon
which any payment of money is scheduled to be made to such Participant, (ii) reduce the principal, interest, fees or other amounts
payable to such Participant (provided, however, that the Lender may, without the consent of the Participant, (A)
amend any financial covenant hereunder (or any defined term used therein) even if the effect of such amendment would be to reduce
the rate of interest on the Term Loan or to reduce any fee payable hereunder and (B) waive the right to be paid Default Interest),
or (iii) release any Guarantor from its Guaranty, as applicable.


 


(e)          The
Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure
obligations of the Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank;
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 the 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.


 




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(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
that have jurisdiction over the Borrower.


 


(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 state or federal court located
in the State of Georgia and 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). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE
THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.


 


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 owed to the
Lender under this Agreement, 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 telex, telefacsimile
or by email, in .pdf format), 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. Delivery of an executed counterpart of a signature
page of this Agreement and any other Loan Document by telex, telefacsimile or by email, in .pdf format, shall be effective as
delivery of a manually executed counterpart of this Agreement or such other Loan Document.


 


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 the Term Loan, 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 the Term Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid.
The provisions of Section 2.13 and Section 9.3 shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the Term Loan 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 Term Loan.


 


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.


 




    	- 58 -



    	 



    




 


Section
9.11.         Confidentiality. The Lender agrees to maintain the
confidentiality of any and all non-public, confidential or proprietary information, identified to the Lender as such, of or relating
to the Borrower or any Subsidiary and their respective businesses, operations, finances or strategies (“Confidential
Information”). For purposes of this Section, Confidential Information shall not include: (1) information that was already
known to the recipient without an obligation of confidentiality to the Borrower or any Subsidiary with respect to such information,
(2) information that was obtained from a third party who was not known to the Lender to be under an obligation of confidentiality
to the Borrower or any Subsidiary with respect to such information, (3) information that is or becomes publicly available, other
than through a breach of this Section by the Lender or any Participant or any of their respective representatives, employees or
agents. Notwithstanding the foregoing, Confidential Information may be disclosed (i) to any officer, director, agent, affiliate
or representative of the Lender, including, without limitation, accountants, legal counsel and other advisors; provided,
however, that such Person shall agree to be bound by the confidentiality provisions set forth in this Section with respect
to such information, (ii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process,
(iii) to the extent requested by any regulatory agency or authority, (iv) to the extent necessary in connection with
the exercise of any remedy hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (v) subject to provisions substantially similar to this Section 9.11, to any actual or prospective assignee
or Participant, or (vi) with the prior written consent of the Borrower. Any Person required to maintain the confidentiality
of any information as provided for in this Section shall be considered to have complied with its obligation to do so if such
Person has exercised the same degree of care to maintain the confidentiality of such information as such Person would accord its
own confidential information, but in no event less than a reasonable degree of care.


 


Section
9.12.         Waiver of Effect of Corporate Seal. The Borrower
represents and warrants that it is not required to affix its corporate seal to this Agreement or any other Loan Document pursuant
to any requirement of law or regulation, agrees that this Agreement is delivered by Borrower under seal and waives any shortening
of the statute of limitations that may result from not affixing the corporate seal to this Agreement or such other Loan Documents.


 


Section
9.13.         Patriot Act. The Lender hereby notifies the Borrower
that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
“Patriot Act”), it is required to obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information that will allow the Lender to identify the Borrower
in accordance with the Patriot Act. The Borrower shall, and shall cause each of its Subsidiaries to, provide to the extent commercially
reasonable, such information and take such other actions as are reasonably requested by the Lender in order to assist the Lender
in maintaining compliance with the Patriot Act.


 


Section
9.14.         Independence of Covenants. All covenants hereunder
shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact
that it would be permitted by an exception to, or would otherwise be within the limitations of, another covenant shall not avoid
the occurrence of a Default or an Event of Default if such action is taken or condition exists.


 




    	- 59 -



    	 



    

 


Section
9.15.         No Advisory or Fiduciary Relationship. In connection
with all aspects of the transactions contemplated hereby (including in connection with any amendment, waiver or other modification
hereof or of any other Loan Document), the Borrower acknowledges and agrees, and acknowledges its Affiliates’ understanding,
that: (i) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate,
and (B) the Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions
contemplated hereby and by the other Loan Documents; (ii) (A) the Lender is and has been acting solely as a principal and, except
as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary
for the Borrower or any of its Affiliates, or any other Person and (B) the Lender does not have any obligation to the Borrower
or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein
and in the other Loan Documents; and (iii) the Lender and its Affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of the Borrower and its Affiliates, and the Lender does not have any obligation to disclose
any of such interests to the Borrower or any of its Affiliates. To the fullest extent permitted by law, the Borrower hereby waives
and releases any claims that it may have against the Lender with respect to any breach or alleged breach of agency or fiduciary
duty in connection with any aspect of any transaction contemplated hereby.


 


[Remainder of page intentionally left
blank. Signatures appear on following pages]




 






    	- 60 -



    	 



    

 


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


 


	 	THE BORROWER:
	 	 
	 	BNC BANCORP
	 	 	 	 
	 	By 	/s/Richard D. Callicutt II
	 	 	Name:  	Richard D. Callicutt II
	 	 	Title:	Executive Vice President and Chief Operating Officer
	 	 	 	 
	 	THE LENDER:
	 	 
	 	SYNOVUS BANK,
	 	as Lender
	 	 	 	 
	 	By 	/s/Michael Sawicki
	 	 	Name: 	Michael Sawicki
	 	 	Title:	Vice President









    	 



    	 



    



 


SCHEDULE 4.12


 


Financial
Institution Subsidiaries


 


	NAME	 	OWNERSHIP %

 BY BORROWER	 	 	JURISDICTION OF 

INCORPORATION
	Bank of North Carolina	 	 	100	%	 	North Carolina



  


Other
Subsidiaries


 


	NAME	 	OWNERSHIP %
 BY BORROWER	 	 	JURISDICTION 

OF
 INCORPORATION
	BNC BANCORP CAPITAL TRUST I	 	 	100	%	 	DELAWARE
	BNC BANCORP CAPITAL TRUST II	 	 	100	%	 	DELAWARE
	BNC CAPITAL TRUST III	 	 	100	%	 	DELAWARE
	BNC CAPITAL TRUST IV	 	 	100	%	 	DELAWARE
	BNC CREDIT CORP.	 	 	100	%	 	NORTH CAROLINA
	STERLING REAL ESTATE HOLDINGS, LLC	 	 	100	%	 	NORTH CAROLINA
	STERLING REAL ESTATE DEVELOPMENT OF NORTH CAROLINA, LLC	 	 	100	%	 	NORTH CAROLINA
	BFNM BLDG, LLC	 	 	66.66667	%	 	SOUTH CAROLINA



 




    	 



    	 



    

 


SCHEDULE
7.1


 


OUTSTANDING
INDEBTEDNESS


  





	Name of Lender 

and Amount of

 Loan	 	Purpose	 	Collateral	 	Debtor
	 	 	 	 	 	 	 
	
        a.     FHLB: $252.6 million line of credit 
	 	Long-term debt	 	Real estate loans and investment securities	 	Bank of North Carolina
	 	 	 	 	 	 	 
	b.     Junior Subordinated Debentures	 	
        Guarantee by BNC Bancorp of trust’s obligations under
        trust preferred securities

         
	 	 	 	
        BNC Bancorp Capital Trust I, BNC Bancorp Capital Trust II, BNC
        Capital Trust III and BNC Capital Trust IV

         

        BNC Bancorp is a guarantor of the obligations 

	 	 	 	 	 	 	 
	c.     $2.435 million of BNC Bancorp 8% Convertible Subordinated Notes Due June 30, 2020	 	Subordinated Debt to 6 holders assumed in connection with the September 14, 2012 KeySource Financial, Inc. merger.  BNC Bancorp has the option to redeem on June 30, 2013.	 	 	 	BNC Bancorp




 




    	 



    	 



    

 


 


SCHEDULE 7.6


 


INVESTMENTS


  


Trust Preferred Securities: BNC Bancorp Capital Trust I, BNC
Bancorp Capital Trust II, BNC Capital Trust III and BNC Capital Trust IV (see Schedule 7.1.b).


 


$2.435 million of BNC Bancorp 8% Convertible
Subordinated Notes Due June 30, 2020: Subordinated Debt to 6 holders assumed in connection with the September 14, 2012 KeySource
Financial, Inc. merger. BNC Bancorp has the option to redeem on June 30, 2013.


  


bfnm
bldg llc: The sole asset of this LLC is the branch office of Bank
of North Carolina d/b/a BNC Bank in Myrtle Beach, SC BNC Bancorp is majority owner of this LLC


  





Exhibit 5.1(c) - 1


  




    	 



    	 



    

  


EXHIBIT A


 


FORM OF
ASSIGNMENT AND ACCEPTANCE


 


This
Assignment and Acceptance (the “Assignment and Acceptance”) is dated as of the Effective Date set forth below and is
entered into by and between the Assignor identified in item 1 below (the “Assignor”) and [the][each] Assignee identified
in item 2 below ([the][each, an] “Assignee”). [It is understood and agreed that the rights and obligations of [the
Assignees] hereunder are several and not joint.] Capitalized terms used but not defined herein shall have the meanings given to
them in the Term Loan Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is
hereby acknowledged by [the][each] Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby
agreed to and incorporated herein by reference and made a part of this Assignment and Acceptance as if set forth herein in full.


  


For
an agreed consideration, the Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each]
Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the Lender as contemplated below (i) all of the Assignor’s
rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered
pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights
and obligations of the Assignor under the term loan facility identified below, and (ii) to the extent permitted to be assigned
under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against
any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing,
including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or
in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold
and assigned by the Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively
as [the][an] “Assigned Interest”). Each such sale and assignment is without recourse to the Assignor and, except as
expressly provided in this Assignment and Acceptance, without representation or warranty by the Assignor.


  




    	A-2



    	 



    

 


	1.	Assignor:	 SYNOVUS BANK
	 	 	 
	2.	Assignee[s]:	______________________________
	 	 	 
	 	 	______________________________


  


[for
each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]


 


	3.	Borrower:	 BNC BANCORP
	 	 	 
	4.	Lender:	 SYNOVUS BANK


  


	5.	 Credit
    Agreement: 	Term
    Loan Agreement dated as of April 26, 2013 between BNC Bancorp and Synovus Bank.
	 	 	 
	6.	 Assigned
    Interest[s]:


  


	Assignor	 	 	Assignee[s]	 	 	Facility
 Assigned	 	Aggregate Amount
 of Term Loans	 	 	Amount of
 Term
 Loan
 Assigned	 	 	Percentage
 Assigned of
 Term Loan	 
	 	 	 	 	 	 	 	 	Term Loan	 	$	 	 	 	$	 	 	 	 	 	%
	 	 	 	 	 	 	 	 	Term Loan	 	$	 	 	 	$	 	 	 	 	 	%
	 	 	 	 	 	 	 	 	Term Loan	 	$	 	 	 	$	 	 	 	 	 	%



  


	[7.	Trade Date:	 ______________]


  


[Signatures
on Following Page]


 




    	A-3



    	 



    

  


Effective
Date: _____________ ___, 20___ [TO BE INSERTED BY LENDER AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]


 


The
terms set forth in this Assignment and Acceptance are hereby agreed to:


  


	 	ASSIGNOR:
	 	 
	 	SYNOVUS BANK
	 	 	 
	 	By:	 
	 	Title:
	 	 	 
	 	ASSIGNEE[S]:
	 	 
	 	[NAME OF ASSIGNEE]
	 	 	 
	 	By:	 
	 	Title:
	 	 	 
	 	[NAME OF ASSIGNEE]
	 	 	 
	 	By:	 
	 	Title:


  




    	A-4



    	 



    

  


ANNEX
1


 


BNC
BANCORP TERM LOAN AGREEMENT


 


STANDARD
TERMS AND CONDITIONS FOR ASSIGNMENT AND ACCEPTANCE


 


1.          Representations
and Warranties.


 


1.1        Assignor.
The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the][the relevant] Assigned Interest,
(ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim, and (iii) it has full power
and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the
transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Loan Document , (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower,
any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document, or (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under
any Loan Document.


 


1.2.       Assignee[s].
[The][Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary,
to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and to become a Lender
under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 9.4 of the Credit Agreement, (iii)
from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the
extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with
respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising
discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has
received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent
financial statements delivered pursuant to Section 5.1 thereof, as applicable, and such other documents and information as it deems
appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase [the][such]
Assigned Interest, and (vi) it has, independently and without reliance upon the Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase
[the][such] Assigned Interest; and (b) agrees that (i) it will, independently and without reliance on the Lender or the Assignor,
and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations
which by the terms of the Loan Documents are required to be performed by it as a Lender.


  




    	A-5



    	 



    

  


2.          Payments.
From and after the Effective Date, the Borrower shall make all payments in respect of [the][each] Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective
Date and to [the][the relevant] Assignee for amounts which have accrued from and after the Effective Date. Notwithstanding the
foregoing, the Borrower shall make all payments of interest, fees or other amounts paid or payable in kind from and after the Effective
Date to [the][the relevant] Assignee.


 


3.          General
Provisions. This Assignment and Acceptance shall be binding upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Acceptance may be executed in any number of counterparts, which together shall constitute
one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Acceptance by telecopy shall be
effective as delivery of a manually executed counterpart of this Assignment and Acceptance. This Assignment and Acceptance shall
be governed by, and construed in accordance with, the law of the State of Georgia.


 




    	A-6



    	 



    

 


EXHIBIT
B


 


FORM OF
TERM NOTE


  


	$30,000,000.00	
        Date: April 26, 2013

        Atlanta, Georgia



 


FOR VALUE RECEIVED, the undersigned, BNC
BANCORP, a North Carolina corporation (the “Borrower”), hereby promises to pay to SYNOVUS BANK (the “Lender”)
or its registered assigns at the Payment Office, on the Maturity Date (as defined in the Term Loan Agreement dated as of April
26, 2013 (as the same may be amended, supplemented or otherwise modified from time to time, the “Term Loan Agreement”),
between the Borrower and Synovus Bank), the lesser of the principal sum of THIRTY MILLION AND NO/100 DOLLARS ($30,000,000.00) and
the aggregate unpaid principal amount of the Term Loan made by the Lender to the Borrower pursuant to the Term Loan 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 Term Loan Agreement. The Borrower shall make principal payments on this Term Note as set forth
in Section 2.5 of the Term Loan Agreement.


 


The term loan evidenced by this Term 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 Term Note and the Term Loan Agreement.


 


Upon the occurrence of an Event of Default
(as defined in the Term Loan Agreement), the Borrower promises to pay interest, on demand, at a rate or rates provided in the Term
Loan Agreement.


 


This Term Note is issued in connection with,
and is entitled to the benefits of, the Term Loan Agreement which, among other things, contains provisions for the payment of principal
and interest at stated intervals, acceleration of the maturity hereof upon the happening of certain events and for the amendment
or waiver of certain provisions of the Term Loan Agreement, all upon the terms and conditions therein specified.




    	B-1



    	 



    

 


THIS TERM NOTE SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF GEORGIA (WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAWS) AND ANY APPLICABLE LAWS OF
THE UNITED STATES OF AMERICA.


  


	 	BNC BANCORP
	 	 	 
	 	By:	 
	 	 	Name:	 
	 	 	Title:	 


 




    	B-2



    	 



    

 


LOANS AND PAYMENTS


  


	Date	 	Amount and Type of Loan	 	Payments of

    Principal	 	Unpaid Principal

    Balance of 

    Term Note	 	Name of Person

    Making Notation
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 


 




    	B-3



    	 



    

 


EXHIBIT 2.2


 


FORM OF NOTICE OF BORROWING


 


[Date]


 


 


 


Synovus Bank


3280 Peachtree Road, NE


Suite 500


Atlanta, Georgia 30305


 


Attn: Michael Sawicki


 


Ladies and Gentlemen:


 


Reference is made to the Term Loan Agreement
dated as of April 26, 2013 (as amended and in effect on the date hereof, the “Credit Agreement”), between the undersigned,
as Borrower, and Synovus Bank. Terms defined in the Credit Agreement are used herein with the same meanings. This notice constitutes
the Notice of Borrowing, and the Borrower hereby requests funding of the Term Loan under the Credit Agreement, and in that connection
the Borrower specifies the following information:


 


(A)         Principal
amount of Term Loan: $30,000,000


 


(B)         Date
of Borrowing (which is a Business Day not less than three (3) Business Days after the date hereof): _________, 2013


 


               (C)         Interest
Rate Basis: [LIBOR]


 


               (D)         Interest
Period: ___ month(s)


 


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


 


	 	 	Very truly yours,
	 	 	 
	 	 	BNC BANCORP
	 	 	 
	 	By: 	 
	 	 	Name:
	 	 	Title:


  




    	B-2



    	 



    

  


EXHIBIT 2.4


 


FORM OF NOTICE OF CONTINUATION


 


[Date]


 


Synovus Bank


3280 Peachtree Road, NE


Suite 500


Atlanta, Georgia 30305


 


Attn: Michael Sawicki


 


Ladies and Gentlemen:


 


Reference is made to the Term Loan Agreement
dated as of April 26, 2013 (as amended and in effect on the date hereof, the “Credit Agreement”), between the undersigned,
as Borrower, and Synovus Bank. Terms defined in the Credit Agreement are used herein with the same meanings. This notice constitutes
a Notice of Continuation and the Borrower hereby requests the continuation of the Term Loan under the Credit Agreement, and in
that connection the Borrower specifies the following information with respect to the Term Loan:


 


 


(A)         Effective
date of election (which is a Business Day):                                                   


 


(B)         Interest
Period for Term Loan:                                                   


  


	 	Very truly yours,
	 	 
	 	BNC BANCORP
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:


 


Exhibit 2.4




 




    	 



    	 



    

 


Exhibit
3.1(b)(iii)


 


FORM OF SECRETARY'S CERTIFICATE OF

BNC BANCORP


 


Reference is made to that certain
Term Loan Agreement dated as of April 26, 2013 (the "Credit Agreement") between BNC BANCORP (the "Borrower”)
and SYNOVUS BANK. Terms defined in the Credit Agreement are used herein with the same meanings. This certificate is being delivered
pursuant to Section 3.1(b)(iii) of the Credit Agreement.


 


I, __________________, Secretary
of the Borrower, DO HEREBY CERTIFY that:


 


a)          annexed
hereto as Exhibit A is a true and correct copy of the certificate of incorporation of the Borrower as in effect on [insert
date of board resolutions in (d) below] and at all times thereafter through the date hereof;


 


b)          annexed
hereto as Exhibit B is a true and correct copy of the bylaws of the Borrower as in effect on [insert date of board
resolutions in (d) below] and at all times thereafter through the date hereof;


 


c)          annexed hereto as Exhibit C is a true and correct
copy of certain resolutions duly adopted by the Board of Directors of the Borrower at a meeting of said Board of Directors duly
called and held on ____________, 2013, which resolutions are the only resolutions adopted by the Board of Directors of the Borrower
or any committee thereof relating to the Credit Agreement and the other Loan Documents to which the Borrower is a party and the
transactions contemplated therein and have not been revoked, amended, supplemented or modified and are in full force and effect
on the date hereof; and


 


d)         each of the persons named below is a duly elected and qualified officer of the Borrower holding the
respective office set forth opposite his or her name and the signature set forth opposite of each such person is his or her genuine
signature:


 


	Name	 	Title	 	Specimen Signature
	[Include all officers who are signing the Credit Agreement or any other Loan Documents.]	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	
        



  


Exhibit 3.1(b)(iii) - 1


 




    	 



    	 



    

 


IN WITNESS WHEREOF, I have hereunto signed
my name as Secretary of the Borrower and not in an individual capacity this ___ day of April, 2013.


 


	 	 
	 	Name: 	 
	 	Title:  Secretary


 


I, ____________, _____________ of the Borrower,
do hereby certify that _______________ has been duly elected, is duly qualified and is the Secretary of the Borrower, and that
the signature set forth above is [his/her] genuine signature.


 


	 	 
	 	Name: 	 
	 	Title:	 


 


Exhibit
3.1(b)(iii) - 2


 




    	 



    	 



    

  


EXHIBIT 3.1(b)(vi)


 


FORM OF OFFICER'S CERTIFICATE


 


Reference is made to that certain Term Loan
Agreement dated as of April 26, 2013 (the "Credit Agreement") between BNC BANCORP (the "Borrower”) and SYNOVUS
BANK. Terms defined in the Credit Agreement are used herein with the same meanings. This certificate is being delivered pursuant
to Section 3.1Section 3.1(b)(vi) of the Credit Agreement.


 


I, ______________________, the ______________________of
the Borrower, DO HEREBY CERTIFY that:


 


		(a)	no Default or Event of Default has occurred and is
continuing at the date hereof;



 


		(b)	the representations and warranties of the Borrower
set forth in the Credit Agreement are true and correct on and as of the date hereof;



 


		(c)	since December 31, 2012, there has been no change,
event or other circumstance which has had or could reasonably be expected to have a Material Adverse Effect;



 


		(d)	other than non-objection from the Federal Reserve
Bank of Richmond as evidenced by letter dated April 26, 2013, from Mr. Adam M. Drimer, Assistant Vice President of the Federal
Reserve Bank to Mr. Richard T. Hills of Womble Carlyle Sandridge & Rice, LLP and from the Office of the Commissioner of Banks
of the State of North Carolina as evidenced by letter dated April 9, 2013 from Mr. Ray Grace, Acting Commissioner of Banks of
the State of North Carolina to Mr. Richard T. Hills of Womble Carlyle Sandridge & Rice, LLP, no consents, approvals, authorizations,
registrations, filings or orders are required to be made or obtained under any applicable law, or by any Contractual Obligation
of the Borrower, in connection with the execution, delivery, performance, validity and enforceability of the Loan Documents or
any of the transactions contemplated thereby; and



 


		(e)	no proceedings have been instituted or are pending
or contemplated with respect to the dissolution, liquidation or sale of all or substantially all the assets of the Borrower or
threatening its existence or the forfeiture or any of its corporate rights;



 


IN WITNESS WHEREOF, I have hereunto signed
my name as _________ of the Borrower and not in an individual capacity this ______ day of April, 2013.


 


	 	 
	 	Name: 	 
	 	Title:	 





 


Exhibit 3.1(b)(vi)


 




    	 



    	 



    

 


EXHIBIT 5.1(c)


 


FORM OF
COMPLIANCE CERTIFICATE


 


		To:	Synovus Bank



3280 Peachtree Road, NE


Suite 500


Atlanta, Georgia 30305


Attn: Michael Sawicki


 


Ladies and Gentlemen:


 


Reference is made to that certain Term Loan
Agreement dated as of April 26, 2013 (as amended and in effect on the date hereof, the “Credit Agreement”),
between BNC BANCORP (the “Borrower”) and Synovus Bank. Capitalized terms used herein and not otherwise defined
shall have the meanings assigned to such terms in the Credit Agreement.


 


I, ______________ , being the duly elected
and qualified, and acting in my capacity as [Chief Financial Officer][President] of the Borrower, hereby certify to the
Lender as follows:


 


1.          The
financial statements of the Borrower and its Subsidiaries for the Fiscal [Quarter / Year] ending ____________ provided to
the Lender as provided in Section 5.1 of the Credit Agreement fairly present in all material respects the financial condition
of the Borrower and its Subsidiaries as at the end of such Fiscal [Quarter / Year] on a consolidated and consolidating basis,
and the related statements of income and cash flows of the Borrower and its Subsidiaries for such Fiscal [Quarter / Year],
in accordance with generally accepted accounting principles consistently applied (subject, in the case of such quarterly financial
statements, to normal year-end audit adjustments and the absence of footnotes).


 


2.          As
of the end of the Fiscal [Quarter / Year] ended _____________, the Borrower and each Financial Institution Subsidiary is
“well- capitalized” in accordance with, and satisfy each of the ratios specified in, Section 6.1 of the Credit Agreement.


 


3.          Based
upon a review of the activities of Borrower and its Subsidiaries and the financial statements attached hereto during the period
covered thereby, as of the date hereof, there exists no Default or Event of Default.


 


IN WITNESS WHEREOF, I have hereunto signed
my name as [Chief Financial Officer][President] of the Borrower and not in an individual capacity this ____day of ______________,
201_.


 


	 	 
	 	Name:	 
	 	Title:	[Chief Financial Officer][President]