Unassociated Document


    
      PROMISSORY
NOTE

      


      


      $15,000,000.00

                  Spartanburg,
South Carolina

      


      December
28, 2007

      


      FOR VALUE RECEIVED, FIRST NATIONAL
BANCSHARES, INC. (the “Borrower”), promises to pay to the order of NEXITY BANK
(the “Lender”) as provided for in the Loan Agreement (as defined below),
the lesser of (i) the principal sum of $15,000,000.00 or (ii) the aggregate
unpaid principal amount of all Loans made by the Lender to the Borrower pursuant
to that certain Loan Agreement, by and between the Borrower and the Lender,
dated of even date herewith (as amended, modified or supplemented from time to
time, the “Loan Agreement”),
together with interest thereon computed from the date hereof as hereinafter
provided (computed on the basis of a 360-day year for the actual number of day
in each interest period).

       

       

      
        	
                 
      

              	
                Term

              


      

      


      The Term of this Note shall be twelve
(12) years.  In the event this Note has not been paid, in accordance
with the terms hereof, the principal and all accrued but unpaid interest shall
be due and payable on December 28, 2019 (“Maturity”).

      


       

      
        	
                 
      

              	
                Interest

              


      

      


      This Note
shall bear interest from the date hereof at a rate equal to the Wall Street
Journal Prime Rate minus one hundred and twenty five (125) basis points
(Prime-1.25%) per annum, floating.  The Borrower will pay the Lender a
$15,000 fee upon execution of this Note.

      


      Any past due installments of principal,
interest or principal and interest, as the case may be, shall bear interest at
the applicable rate set out herein until paid.  Interest shall be
computed on the basis of a 360-day year.  After this Note shall become
due, whether by acceleration or otherwise, this Note shall bear interest at a
rate equal to the Wall Street Journal stated Prime Rate, plus three percent (3%)
per annum, floating.  The applicable rates of interest set forth in
this Note shall apply both before and after any judgment on the indebtedness
evidenced by this Note.

      


       

      
        	
                 
      

              	
                Repayment
      Terms

              


      

      


                 From
the date of this Note, on the last day of each calendar quarter, beginning with
the March 31, 2008 payment, and continuing through December 31, 2009, the
Borrower shall make quarterly installments of accrued and unpaid
interest.  

      


      
        
           

        

        
           

          
            

          

        

        
           

        

      

      


      Commencing
on December 31, 2010 and continuing on the last day of each successive calendar
year thereafter, through and including the date of Maturity, the Borrower shall
make annual principal payments in an amount equal to the total outstanding
principal balance of the Loan as of December 31, 2009 based upon a ten (10) year
amortization, plus payments in quarterly installments of accrued and unpaid
interest.  All remaining unpaid principal, accrued interest and all
other sums and costs incurred by the Lender pursuant to this Agreement with
respect to the Loan shall be immediately due and payable on the Maturity Date
without notice, presentment or demand of any kind.

      


      Time is of the essence of this
Note.  In the event the Borrower fails to make a full payment of any
installment of principal or interest due under this Note when due, then to
compensate for the extra cost and expenses caused by such late payment, the
Borrower shall pay to the Lender a “late charge” in an amount equal to five (5%)
percent of the amount of the late payment of principal and/or
interest.  Such late charge will be waived if the Borrower makes
payment in full within 2 business days of the date such payment is
due.  This paragraph shall not be deemed to grant to the Borrower a
grace period for the payment of quarterly installments, and such quarterly
installments shall be payable on the due dates thereof as elsewhere provided
herein.

      


       

      
        	
                 
      

              	
                Prepayment

              


      

      


      The
Borrower may prepay the principal amount and accrued interest of the
Loan

      at any
time, in full or in part, without any penalty.

      


       

      
        	
                 
      

              	
                Security;  Default

              


      

      


      This Note is secured by that certain
Stock Pledge Agreement, between Borrower and Lender, dated of even date herewith
(the “Stock Pledge Agreement”).  The terms and conditions of the Stock
Pledge Agreement shall be considered parts hereof to the same extent as if
written herein, and in the event of a default by the Borrower in any agreement,
covenant or condition contained in the Stock Pledge Agreement, or in the event
any payment of principal or interest or of principal and interest as the case
may be, required to be paid by this Note is not paid when due, or in the event
of any other violation or breach of any material term, condition, covenant or
provision of this Note, the entire remaining unpaid principal of this Note and
all accrued, but unpaid interest thereon, shall immediately be due and payable
at the option of the holder hereof.  In the event this Note is placed
with an attorney at law for the collection or enforcement, the Borrower agrees
to pay all costs of collection or enforcement, including without limitation,
court costs and reasonable attorneys fees.

      


       

      
        	
                 
      

              	
                Payments
      Not to Violate Law

              


      

      


      Nothing herein contained nor any
transaction related thereto shall be construed or so operate as to require the
Borrower to pay interest at a rate greater than it is now lawful in such case to
contract for under applicable law, or to make any payment or to do any act
contrary to applicable law, and the Lender shall reimburse the Borrower for any
interest paid in excess of the highest rate allowed by the applicable law or any
other payment which may inadvertently be required to be paid contrary to the
applicable law;  and if any clauses or provisions herein contained
operate or would prospectively operate to invalidate this Note, in whole, or in
part, then such clauses and provisions only shall be held for naught, as though
not herein contained, and the remainder of this Note shall remain operative and
in full force and effect.

      


      
        
           

        

        
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                Governing
      Law

              


      

      


      This Note shall be governed by and
construed in accordance with the laws of the State of South
Carolina.

      


       

      
        	
                 
      

              	
                Modification;
      Assumption

              


      

      


      It is important that the Borrower
thoroughly read this Note before it is signed, as well as any other document
required in this transaction and which are incorporated herein by
reference.  This Note and these documents contain all of the terms and
understandings between the Lender and the Borrower relating to this transaction,
there being no other terms or understandings unless written.  This
Note and other applicable documents cannot be changed orally, but only by
written agreement and signed by all parties hereto.  Payment of this
Note may not be assumed by third parties without the written consent of the
Lender, which consent the Lender is under no obligation to give, and if given,
the Lender may condition such consent on a change in the terms and conditions in
the loan documents and may require that the original parties remain
liable.

      


       

      
        	
                 
      

              	
                Waivers

              


      

      


      All parties to this Note, including
endorsers, sureties, and guarantors, if any, hereby waive presentment for
payment, demand, protest, notice of nonpayment or dishonor and of protest, and
any and all other notices and demand whatsoever, and agree to remain bound until
the principal and interest are paid in full, notwithstanding any extensions of
time for payment which may be granted even though the period or periods of
extension be indefinite and notwithstanding any inaction by, or failure to
assert any legal rights available to the holder of this Note.

      


      IN WITNESS WHEREOF, the Borrower has
caused this instrument to be duly executed under seal as of the day and year
first above written.

       

       

      
        
          
            
              
                
                  	 	 	FIRST
      NATIONAL BANCSHARES, INC.	 
	Witnesses:	 	 	 
	 	 	 	 
	 	 	 	 	 
	
                           
      

                        	 	
                          By:
      

                        	 
      	 
	 	 	 	Kitty
      B. Payne	 
	 	 	Its:	Chief
      Financial Officer	 
	 	 	 	 	 


                

              

            

          

        



      


      


      


      
        
           

        

        
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