EX-10.1 Revolving Credit Agreement



 





Exhibit 10.1




EXECUTION COPY




REVOLVING CREDIT AGREEMENT




dated as of February 28, 2008




between




PINNACLE FINANCIAL PARTNERS, INC.

as Borrower




and




SUNTRUST BANK

as Lender




 









 





TABLE OF CONTENTS




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	ARTICLE I. DEFINITIONS; CONSTRUCTION	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	Section 1.1.	 	Definitions
	 	 	1	 
	Section 1.2.	 	Accounting Terms and Determination
	 	 	8	 
	Section 1.3.	 	Terms Generally
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE II. AMOUNT AND TERMS OF THE REVOLVING COMMITMENTS	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	Section 2.1.	 	Revolving Loans and Revolving Credit Note
	 	 	9	 
	Section 2.2.	 	Procedure for Revolving Loans
	 	 	9	 
	Section 2.3.	 	Optional Reduction and Termination and/or Extension of Revolving
Commitment
	 	 	10	 
	Section 2.4.	 	Repayment and Prepayments of Revolving Loans
	 	 	10	 
	Section 2.5.	 	Interest on Loans
	 	 	10	 
	Section 2.6.	 	Fees
	 	 	11	 
	Section 2.7.	 	Computation of Interest and Fees
	 	 	11	 
	Section 2.8.	 	Inability to Determine Interest Rates
	 	 	11	 
	Section 2.9.	 	Illegality
	 	 	11	 
	Section 2.10.	 	Increased Costs
	 	 	11	 
	Section 2.11.	 	Payments Generally
	 	 	12	 
	Section 2.12.	 	Funding Indemnity
	 	 	12	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE III. CONDITIONS PRECEDENT TO REVOLVING LOANS	 	 	13	 
	 
	Section 3.1.	 	Conditions to Initial Revolving Loan
	 	 	13	 
	Section 3.2.	 	Each Revolving Loan
	 	 	13	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE IV. REPRESENTATIONS AND WARRANTIES	 	 	14	 
	 
	Section 4.1.	 	Existence; Power
	 	 	14	 
	Section 4.2.	 	Organizational Power; Authorization
	 	 	14	 
	Section 4.3.	 	Governmental Approvals; No Conflicts
	 	 	14	 
	Section 4.4.	 	Financial Statements
	 	 	14	 
	Section 4.5.	 	Litigation Matters
	 	 	15	 
	Section 4.6.	 	Compliance with Laws and Agreements
	 	 	15	 
	Section 4.7.	 	Investment Company Act, Etc
	 	 	15	 
	Section 4.8.	 	Taxes
	 	 	15	 
	Section 4.9.	 	Margin Regulations
	 	 	15	 
	Section 4.10.	 	ERISA
	 	 	15	 
	Section 4.11.	 	Disclosure
	 	 	15	 
	Section 4.12.	 	Subsidiaries
	 	 	16	 
	Section 4.13.	 	Dividend Restrictions; Other Restrictions
	 	 	16	 
	Section 4.14.	 	Capital Measures
	 	 	16	 
	Section 4.15.	 	FDIC Insurance
	 	 	16	 
	Section 4.16.	 	OFAC
	 	 	16	 
	Section 4.17.	 	Patriot Act
	 	 	16	 






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	 	 	 	 	 	 	Page
	ARTICLE V. AFFIRMATIVE COVENANTS	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	Section 5.1.	 	Financial Statements and Other Information
	 	 	17	 
	Section 5.2.	 	Notices of Material Events
	 	 	18	 
	Section 5.3.	 	Existence; Conduct of Business
	 	 	18	 
	Section 5.4.	 	Compliance with Laws, Etc
	 	 	18	 
	Section 5.5.	 	Books and Records
	 	 	18	 
	Section 5.6.	 	Visitation, Inspection, Etc
	 	 	19	 
	Section 5.7.	 	Maintenance of Properties; Insurance
	 	 	19	 
	Section 5.8.	 	Use of Proceeds
	 	 	19	 
	Section 5.9.	 	Senior Management
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE VI. FINANCIAL COVENANTS	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	Section 6.1.	 	Return on Average Assets
	 	 	19	 
	Section 6.2.	 	Asset Quality Ratio
	 	 	19	 
	Section 6.3.	 	Capital Measures
	 	 	20	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE VII. NEGATIVE COVENANTS	 	 	20	 
	 	 	 	 	 
	 	 	 	 
	Section 7.1.	 	Indebtedness
	 	 	20	 
	Section 7.2.	 	Negative Pledge
	 	 	21	 
	Section 7.3.	 	Fundamental Changes
	 	 	22	 
	Section 7.4.	 	Restricted Payments
	 	 	22	 
	Section 7.5.	 	Restricted Agreements
	 	 	22	 
	Section 7.6	 	Investments, Etc
	 	 	23	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE VIII. EVENTS OF DEFAULT	 	 	23	 
	 	 	 	 	 
	 	 	 	 
	Section 8.1.	 	Events of Default
	 	 	23	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE IX. MISCELLANEOUS	 	 	26	 
	 	 	 	 	 
	 	 	 	 
	Section 9.1.	 	Notices
	 	 	26	 
	Section 9.2.	 	Waiver; Amendments
	 	 	27	 
	Section 9.3.	 	Expenses; Indemnification
	 	 	27	 
	Section 9.4.	 	Successors and Assigns
	 	 	28	 
	Section 9.5.	 	Governing Law; Jurisdiction; Consent to Service of Process
	 	 	29	 
	Section 9.6.	 	Waiver of Jury Trial
	 	 	29	 
	Section 9.7.	 	Right of Setoff
	 	 	29	 
	Section 9.8.	 	Counterparts; Integration
	 	 	30	 
	Section 9.9.	 	Survival
	 	 	30	 
	Section 9.10.	 	Severability
	 	 	30	 
	Section 9.11.	 	Interest Rate Limitation.
	 	 	30	 
	Section 9.12.	 	Patriot Act
	 	 	31	 






ii









 






	 	 	 	 	 
	Schedules
	 	 	 	 
	 
	Schedule 4.12
	 	—	 	Subsidiaries
	Schedule 7.1
	 	—	 	Outstanding Indebtedness
	 
	Exhibits
	 	 	 	 
	 
	Exhibit A
	 	—	 	Revolving Credit Note
	Exhibit 2.2
	 	—	 	Notice of Revolving Borrowing






iii









 






REVOLVING CREDIT AGREEMENT




          THIS REVOLVING CREDIT AGREEMENT (this “Agreement”) is made and entered into as of
February 28, 2008, by and between PINNACLE FINANCIAL PARTNERS, INC., a Tennessee corporation (the
“Borrower”), and SUNTRUST BANK, a Georgia banking corporation (the “Lender”).




W I T N E S S E T H:




          WHEREAS, the Borrower has requested the Lender, and the Lender has agreed, subject to the
terms and conditions of this Agreement, to establish a 364-day revolving credit facility in an
original principal amount of $25,000,000;




          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 of any
Person, or otherwise causing a Person to become a Subsidiary, or (c) a merger or consolidation of,
or any other combination with, another Person (other than a Person that is a Subsidiary), provided
that the Borrower or any Subsidiary is the surviving entity.




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




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




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




          “Base Rate Loan” shall mean a Revolving Loan which bears interest at the Base Rate.




          “Business Day” shall mean (i) any day other than a Saturday, Sunday or other day on which
commercial banks in Atlanta, Georgia are authorized or required by law to close and (ii) if such
day relates to a borrowing or continuation of, a payment or prepayment of principal or interest on,
or an Interest Period for,




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a Eurodollar Loan or a notice with respect thereto, any day on which dealings in Dollars are
carried on in the London interbank market.




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




          “Change in Control” shall mean (a) with respect to the Borrower, the occurrence of one or
more of the following events: (i) any sale, lease, exchange or other transfer (in a single
transaction or a series of related transactions) of all or substantially all of the assets of the
Borrower to any Person or “group” (within the meaning of the Securities Exchange Act of 1934 and
the rules of the Securities and Exchange Commission thereunder in effect on the date hereof), (ii)
the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or
“group” (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof) of 25% or more of the
outstanding shares of the voting stock of the Borrower or (iii) occupation of a majority of the
seats (other than vacant seats) on the board of directors of the Borrower by Persons who were
neither (A) nominated by the current board of directors or (B) appointed by directors so nominated,
or (b) the Borrower shall own, directly or indirectly, less than 100% of the voting stock of any
Financial Institution Subsidiary. Notwithstanding the foregoing, the PrimeTrust Transaction will
not constitute a Change in Control.




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




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




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




          “Commitment Termination Date” shall mean February 27, 2009, or such later date as the
Revolving Commitment has been extended pursuant to Section 2.3, or earlier if terminated
pursuant to Section 2.3 or Section 8.1.




          “Control” shall mean the power, directly or indirectly, either to (i) vote 50% or more of
securities having ordinary voting power for the election of directors (or persons performing
similar functions) of a Person or (ii) direct or cause the direction of the management and policies
of a Person, whether through the ability to exercise voting power, by contract or otherwise. The
terms “Controlling”, “Controlled by”, and “under common Control with” have meanings correlative
thereto.




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




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




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




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          “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.




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




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




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




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




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




3









 








          “Financial Institution Subsidiary” shall mean each of (a) Pinnacle National Bank, and (b) each
other Subsidiary existing on the Closing Date or hereafter formed or acquired that is a depository
institution with FDIC-insured deposits.




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




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




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




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




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




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




          “Interest Period” shall mean, with respect to any Eurodollar Loan, a period of one month,
provided that:




4









 









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




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




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




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



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







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





(i) the rate per annum equal to the London interbank offered rate for deposits in
U.S. dollars for a one-month period, which rate appears on Reuters Screen LIBOR01 Page
(or any successor page), or such similar service as determined by the Bank that
displays British Bankers’ Association interest settlement rates for deposits in U.S.
Dollars, as of 11:00 A.M. (London, England time) two (2) Business Days prior to the
Interest Rate Determination Date; provided, that if no such offered rate
appears on such page, the rate used will be the per annum rate of interest determined
by the Bank to be the rate at which U.S. dollar deposits for a one-month period are
offered to the Bank in the London Inter-Bank Market as of 10:00 A.M. (Atlanta, Georgia
time), on the day which is two (2) Business Days prior to the Interest Rate
Determination Date, divided by




(ii) a percentage equal to 1.00 minus the maximum reserve percentages (including any
emergency, supplemental, special or other marginal reserves) expressed as a decimal
(rounded upward to the next 1/100th of 1%) in effect on any day to which the Bank is
subject with respect to any 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). This
percentage will be adjusted automatically on and as of the effective date of any change
in any reserve percentage.



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







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




          “Material Adverse Effect” shall mean, with respect to any event, act, condition or occurrence
of whatever nature (including any adverse determination in any litigation, arbitration, or
governmental investigation or proceeding but excluding any such event, act, condition or occurrence
resulting from a




5









 







Change in Law that affects bank holding companies generally (including the bank
holding company of the Lender)
and/or each FDIC-insured financial institution generally (including the Lender)), 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 obligations under the Loan Documents, (iii) the rights and remedies
of the Lender under any of the Loan Documents or (iv) the legality, validity or enforceability of
any of the Loan Documents.




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




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




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




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




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




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




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




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




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




          “Permitted Encumbrances” shall mean




6









 









     (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;




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




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




     (vi) easements, zoning restrictions, rights-of-way and similar encumbrances on real
property imposed by law or arising in the ordinary course of business that do not secure any
monetary obligations and do not materially detract from the value of the affected property
or materially interfere with the ordinary conduct of business of the Borrower and its
Subsidiaries taken as a whole;


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




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




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




          “PrimeTrust Transaction” shall mean the sale of the stock of PrimeTrust Bank, a wholly-owned
Subsidiary of the Borrower, by the Borrower to Metropolitan Bancgroup, Inc., the merger of
PrimeTrust Bank into a wholly-owned bank subsidiary of Metropolitan Bancgroup, Inc. and the
subsequent sale of the assets and liabilities formerly held by PrimeTrust Bank (other than the
real estate and other real property constituting the banking office of Metropolitan Bancgroup, Inc.
in Memphis, Tennessee) to Pinnacle National Bank.




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




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




7









 








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




          “Revolving Commitment” shall mean the obligation of the Lender to make Revolving Loans to the
Borrower in an aggregate principal amount not exceeding $25,000,000.




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




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




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




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




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




          “Total Loans” shall mean for the Borrower on a consolidated basis the line item “Loans net of
unearned income” set forth on the Borrower’s consolidated balance sheet delivered pursuant to
Section 5.1(a) and (b).




          “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




8









 







Borrower’s independent public
accountants) with the most recent audited consolidated financial statement of the Borrower
delivered pursuant to Section 5.1(a); provided, that if the Borrower
notifies the Lender that the Borrower wishes to amend any covenant in Article
VI to eliminate the effect of any change in GAAP on the operation of such covenant (or if the
Lender notifies the Borrower that it wishes to amend Article VI for such purpose), then the
Borrower’s compliance with such covenant shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either such notice is
withdrawn or such covenant is amended in a manner satisfactory to the Borrower and the Lender.




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




ARTICLE II




AMOUNT AND TERMS OF THE REVOLVING COMMITMENT




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




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




          Section 2.2. Procedure for Revolving Loans. The Borrower shall give the Lender
written notice (or telephonic notice promptly confirmed in writing) of each Revolving Loan
substantially in the form of Exhibit 2.2 (a “Notice of Borrowing”) prior to 11:00 a.m. two (2)
Business Days prior to which a Revolving Loan is being requested. Each Notice of Borrowing shall be
irrevocable and shall specify: (i) the principal amount of the Revolving Loan, (ii) the proposed
date of the Revolving Loan (which shall be a Business Day), and (iii) if the Revolving Loan is
$2,500,000 or greater, its purpose (provided in sufficient detail that is reasonably satisfactory
to the Lender). The aggregate principal amount of each Revolving Loan shall be not less than
$1,000,000 or a larger multiple of $500,000, or in such
lesser amounts equal to the




9









 







amount of the unused Revolving Commitment. Upon the satisfaction of the
applicable conditions set forth in Article III hereof, the Lender will make the proceeds of each
Revolving Loan available to the Borrower at the Payment Office on the date specified in the
applicable Notice of Borrowing by crediting an account maintained by the Borrower with the Lender
or at the Borrower’s option, by effecting a wire transfer of such amount to an account designated
by the Borrower to the Lender.




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




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




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




          Section 2.4. Repayment and Prepayments of Revolving Loans.




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




          (b) The Borrower shall have the right at any time and from time to time to prepay any
Eurodollar Loan, in whole or in part, without premium or penalty, subject to Section 2.12
hereof. Each partial prepayment shall be in an amount not less than $100,000 and integral multiples
thereof.




          (c) Subject to Sections 2.8 and 2.9, each Eurodollar Loan shall automatically
continue on the last day of an Interest Period for another one-month Interest Period unless the
Borrower elects to repay in whole or in part such Eurodollar Loan on the last day of such Interest
Period. In the case of a partial repayment, such Eurodollar Loan shall be continued for another
one-month Interest Period in the principal amount designated by the Borrower, subject to the
minimum amounts specified in Section 2.2.




          Section 2.5. Interest on Loans.




          (a) The Borrower shall pay interest on each Eurodollar Loan at LIBOR, plus 1.25% per annum. If
a Base Rate Loan shall be outstanding under the circumstances set forth in Section 2.8 or
2.9, then the Borrower shall pay interest on each Base Rate Loan at the Base Rate in effect
from time to time.




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



10









 






Interest Period, and thereafter, and with respect to all Base Rate Loans and all other
Obligations hereunder (other than Loans), at the Base Rate, plus 2% per annum.




          (c) Interest on the principal amount of all Revolving Loans shall accrue from and including
the date such Revolving Loans are made to but excluding the date of any repayment thereof. Interest
on all outstanding Eurodollar Loans shall be payable on the last day of each Interest Period
applicable thereto and on the Commitment Termination Date. Interest on any Base Rate Loans shall be
payable on the last day of each calendar month and on the Commitment Termination Date. All Default
Interest shall be payable on demand.




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




          Section 2.6. Fees. The Borrower agrees to pay to the Lender a commitment fee, which
shall accrue at 0.10% p. a. on the daily amount of the unused Revolving Commitment during the
Availability Period. Accrued commitment fees shall be payable in arrears on the last day of each
March, June, September and December of each year and on the Commitment Termination Date, commencing
on the first such date after the Closing Date.




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




          Section 2.8. Inability to Determine Interest Rates. If prior to the commencement of
any Interest Period for any Eurodollar Loan, the Lender shall have determined (which determination
shall be conclusive 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) LIBOR
does not adequately and fairly reflect the cost to the Lender of making, funding or maintaining its
Eurodollar Loans, the Lender shall give written notice (or telephonic notice, promptly confirmed in
writing) to the Borrower as soon as practicable thereafter. Until the Lender notifies the Borrower
that the circumstances giving rise to such notice no longer exist, (x) the obligation of the Lender
to make Eurodollar Loans or to continue outstanding Revolving Loans as Eurodollar Loans shall be
suspended and (y) all such affected Eurodollar Loans shall be converted into Base Rate Loans on the
last day of the then current Interest Period unless the Borrower elects to prepay such Revolving
Loans in accordance with this Agreement.




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




          Section 2.10. Increased Costs.




          (a) If any Change in Law shall:




11









 









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




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



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




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




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




          Section 2.11. Payments Generally. The Borrower shall make each payment required to
be made by it hereunder (whether of principal, interest, fees, or of amounts payable under
Section 2.10 or otherwise) prior to 12:00 noon, on the date when due, in immediately
available funds, without set-off or counterclaim. Any amounts received after such time on any date
may, in the discretion of the Lender, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments shall be made to the
Lender at its Payment Office. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in
the case of any payment accruing interest, interest thereon shall be made payable for the period of
such extension. All payments hereunder shall be made in Dollars.




          Section 2.12. 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), or (b) the failure by the Borrower to borrow, prepay, or
continue any Eurodollar Loan on the date specified in any applicable notice (regardless of whether
such notice is withdrawn or revoked), then, in any such event, the Borrower shall compensate the
Lender, within five (5) Business Days after written demand from the Lender, for any loss, cost or
expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense
shall be deemed to include an amount determined by the Lender to be
the





12












 




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 borrow or 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 converted or the date on which the Borrower failed to borrow or
continue such Eurodollar Loan. A certificate as to any additional amount payable under this
Section 2.12 submitted to the Borrower by the Lender shall be conclusive, absent manifest
error.




ARTICLE III




CONDITIONS PRECEDENT TO REVOLVING LOANS 




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




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




          (b) a duly executed Revolving Credit Note;




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




          (d) certified copies of the articles of incorporation of the Borrower, together with good
standing certificates (or the equivalent) as may be available from the Secretary of State of the
jurisdiction of incorporation of the Borrower and each Subsidiary (and in the case of a Financial
Institution Subsidiary which is a national bank, from the Office of the Comptroller of the
Currency) and each other jurisdiction where the Borrower or such Subsidiary (other than a Financial
Institution Subsidiary which is a national bank) is required to be qualified to do business as a
foreign corporation;




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




          (f) a duly executed funds disbursement agreement.




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




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




          (b) all representations and warranties of the Borrower herein shall be true and correct in
all material respects on and as of the date of such Revolving Loan both before and after giving
effect thereto;




13









 





          (c) since December 31, 2006, there shall have been no change which has had or could reasonably
be expected to have a Material Adverse Effect;




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




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




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




ARTICLE IV




REPRESENTATIONS AND WARRANTIES




          The Borrower represents and warrants to the Lender as follows:




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



     (b) Pinnacle Bank is a national bank chartered under the laws of the United States and has all
requisite power and authority to carry on its business as now conducted.



          Section 4.2. Organizational Power; Authorization. The execution, delivery and
performance by the Borrower of each of the Loan Documents are within the Borrower’s corporate
powers and have been duly authorized by all necessary corporate, and if required, stockholder,
action. This Agreement 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.




          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, (c) will not violate or result in a default under any
indenture, material agreement or other material instrument binding on the Borrower or any of its
Subsidiaries or any of its assets or give rise to a right thereunder to require any payment to be
made by the Borrower or any of its Subsidiaries and (d) will not result in the creation or
imposition of any Lien on any asset of the Borrower or any of its Subsidiaries, except Liens (if
any) created under the Loan Documents.




14









 





          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, 2006 and
the related consolidated statements of income, shareholders’ equity and cash flows for the fiscal
year then ended prepared by KPMG, LLP and (ii) the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of the September 30, 2007, and the related unaudited
consolidated statements of income and cash flows for the fiscal quarter and year-to-date period
then ending, certified by the chief financial officer or treasurer of the Borrower. Such financial
statements fairly present, in all material respects, the consolidated financial position
of the Borrower and its Subsidiaries as of such dates and the consolidated results of
operations and cash flows for such periods in conformity with GAAP consistently applied, subject to
year end audit adjustments and the absence of footnotes in the case of the statements referred to
in clause (ii). Since December 31, 2006, there have been no changes with respect to the Borrower
and its Subsidiaries which have had or could reasonably be expected to have, singly or in the
aggregate, a Material Adverse Effect.




          Section 4.5. Litigation Matters. No litigation, investigation or proceeding of or
before any arbitrators or Governmental Authorities is pending against, or, to the knowledge of the
Borrower, threatened against or affecting the Borrower or any of its Subsidiaries (i) as to which
there is a reasonable possibility of an adverse determination that 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.




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




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




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




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




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




15









 




amounts, exceed by more than $1,000,000 the fair market
value of the assets of all such Plan, and the present value of all accumulated benefit obligations
of all underfunded Plans (based on the assumptions used for purposes of Statement of Financial
Standards No. 87) did not, as of the date of the most recent financial statements reflecting such
amounts, exceed by more than $1,000,000 the fair market value of the assets of all such underfunded
Plans.




          Section 4.11. Disclosure. The Borrower has disclosed to the Lender all agreements,
instruments, and corporate or other restrictions to which the Borrower or any of its Subsidiaries
is subject, and
all other matters known to any of them, that, individually or in the aggregate, 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 the negotiation of 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, each Financial Institution
Subsidiary and each other Subsidiary, in each case as of the Closing Date.




          Section 4.13. Dividend Restrictions; Other Restrictions. (a) No Financial Institution
Subsidiary has violated any applicable regulatory restrictions on dividends, and no Governmental
Authority has taken any action to restrict the payment of dividends by any Financial Institution
Subsidiary.




          (b) 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.




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




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




          Section 4.16. OFAC. Neither the Borrower nor any of its Subsidiaries (i) is a person
whose property or interest in property is blocked or subject to blocking pursuant to Section 1 of
Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)), (ii)
engages in any dealings or transactions prohibited by Section 2 of such executive order, or is
otherwise associated with any such person in any manner violative of Section 2 or (iii) is a person
on the list of Specially Designated Nationals and Blocked Persons or subject to the limitations or
prohibitions under any other U.S. Department of Treasury’s Office of Foreign Assets Control
regulation or executive order.




          Section 4.17. Patriot Act. Each of the Borrower and its Subsidiaries is in compliance,
in all material respects, with (i) the Trading with the Enemy Act, as amended, and each of the
foreign assets control




16









 




regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) and any other enabling legislation or executive order relating thereto and
(ii) the Uniting And Strengthening America By Providing Appropriate Tools Required To Intercept And
Obstruct Terrorism (USA Patriot Act of 2001). No part of the proceeds of the Revolving Loans 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.




ARTICLE V




AFFIRMATIVE COVENANTS




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




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




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




          (b) as soon as available and in any event within 45 days after the end of each of the first
three fiscal quarters of each fiscal year of the Borrower, an unaudited balance sheet of the
Borrower and its Subsidiaries on a consolidated basis 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 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;




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




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




17









 





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




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




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




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




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




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




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




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




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




          (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.




18









 





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




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




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




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




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



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




          Section 5.9. Senior Management. The Borrower shall at all times have senior management
(including without limitation its president and chief executive officer, its principal financial
and accounting officer, and its principal credit risk officer) with sufficient experience in the
financial services industry at least comparable in all material respects to the experience of its
president and chief executive officer, its principal financial and accounting officer, and its
principal credit risk officer holding such positions on the Closing Date.




ARTICLE VI




FINANCIAL COVENANTS




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




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          Section 6.1. Return on Average Assets. The Borrower on a consolidated basis will have
at the end of each Fiscal Quarter a Return on Average Assets for such Fiscal Quarter and the
previous three Fiscal Quarters of not less than an average of 0.50%, determined by taking the sum
of the Return on Average Assets (adjusted for special restructuring, merger-related or other
exceptional charges but excluding any special charges with respect to additional loan loss reserves
or other loan quality deterioration) for each such Fiscal Quarter (as such figure is disclosed in
the Borrower’s consolidated financial statements that are submitted to the Securities and Exchange
Commission on Forms 10-K or 10-Q), divided by four (4).




          Section 6.2. Asset Quality Ratio. The Borrower on a consolidated basis will not permit
at the end of each Fiscal Quarter Nonperforming Assets to be greater than 1.50% of the sum of Total
Loans (excluding loans held for sale) and Other Real Estate Owned (in each case as such figures are
disclosed in the
Borrower’s consolidated financial statements that are submitted to the Securities and Exchange
Commission on Forms 10-K or 10-Q).




          Section 6.3. Capital Measures. (a) The Borrower will be “adequately capitalized” for
all applicable state and federal regulatory purposes at all times, and the Borrower (i) will have
a Total Risk-based Capital Ratio of 8.0% or greater, a Tier 1 Risk-based Capital Ratio of 4.0% or
greater, and a Tier 1Leverage Capital Ratio of 4.0% or greater (each as defined by applicable
federal and state regulations or orders), and 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 or (ii) if required by any Governmental Authority having
regulatory authority over the Borrower in order to remain “adequately capitalized” and in
compliance with all applicable regulatory requirements, will have such higher amounts of Total
Risk-based Capital and Tier 1 Risk-based Capital and/or such greater Leverage Ratio as specified by
such Governmental Authority.




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



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



ARTICLE VII




NEGATIVE COVENANTS




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




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




          (a) Indebtedness created pursuant to the Loan Documents;




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




          (c) Indebtedness of Financial Institution Subsidiaries (i) to the Federal Reserve Board or to
the Federal Home Loan Bank Board, (ii) constituting federal funds purchased and securities sold
under agreements to repurchase incurred in the ordinary course of business, (iii) constituting
subordinated indebtedness in an aggregate amount not to exceed $5,000,000 (less any amount incurred
pursuant to paragraph (h) below) or (iv) otherwise incurred in the ordinary course of their banking
business;




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




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




          (f) Any other Indebtedness that is subordinated to the Indebtedness under this Agreement which
contains terms, covenants and conditions in form and substance reasonably satisfactory to the
Lender as evidenced by its prior written approval thereof;




          (g) Indebtedness incurred under (i) Hedging Agreements 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 and (ii) Hedging Agreements entered
into by any Financial Institution Subsidiary as a counterparty in the ordinary course of its
business; and




          (h) Indebtedness of any Person purchased in a permitted Acquisition as long as the Borrower is
in compliance both before and after such Acquisition with the covenants contained in Article VI and
no Default or Event of Default exists or would result from such Acquisition, provided that the
amount of such Indebtedness together with the amount of such Indebtedness permitted in Section
7.1(c)(iii) shall not exceed $5,000,000 in the aggregate.




          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, except:




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




          (b) Permitted Encumbrances;




21









 





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




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



Provided, that at no time and under no circumstances will the Borrower permit any Lien on the
capital stock of any Financial Institution Subsidiary.




          Section 7.3. Fundamental Changes.




          (a) The Borrower will not, and will not permit any Subsidiary to, merge into or consolidate
into any other Person, or permit any other Person to merge into or consolidate with it, or sell,
lease, transfer or otherwise dispose of (in a single transaction or a series of transactions) all
or substantially all of its assets (other than in the ordinary course of business) or all or
substantially all of the stock of any of its Subsidiaries or liquidate or dissolve;
provided, that if at the time thereof and immediately after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing, (i) the Borrower or any
Subsidiary may merge with a Person which is not affiliated with the Borrower if the Borrower (or
such Subsidiary if the Borrower is not a party to such merger) is the surviving Person, (ii) any
Subsidiary may merge into another Subsidiary provided that in the case of a Financial Institution
Subsidiary, a Financial Institution Subsidiary is the surviving Person, (iii) any Subsidiary may
sell, lease, transfer or dispose of its assets to (A) the Borrower, (B) in the case of any
Subsidiary that is not a Financial Institution Subsidiary, to any other Subsidiary and (C) in the
case of a Financial Institution Subsidiary, to another Financial Institution Subsidiary or to a
Subsidiary which is not a Financial Institution Subsidiary provided that such Subsidiary is a
direct or indirect Subsidiary of the selling Financial Institution Subsidiary, (iii) any Subsidiary
(other than a Financial Institution Subsidiary) or the assets of any Subsidiary may be sold or
otherwise transferred so long as the aggregate value of such assets or of such Subsidiary shall not
exceed $500,000 in any fiscal year, provided, that any Financial Institution Subsidiary may
sell loans, investments or other assets in the ordinary course of its business and (iv)
notwithstanding anything to the contrary in any of the foregoing, (A) the Borrower or any
Subsidiary may enter into a sale leaseback transaction of any of its real property, now owned or
hereafter acquired, and (B) the PrimeTrust Transaction may occur.




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




          Section 7.4. Restricted Payments. Upon the occurrence and during the continuation of
any Default or Event of Default, the Borrower will not, and will not permit its Subsidiaries to,
declare or make, or agree to pay or make, directly or indirectly, any dividend on any class of its
stock, or make any payment on account of, or set apart assets for a sinking or other analogous fund
for, the purchase, redemption, retirement, defeasance or other acquisition of, any shares of common
stock or Indebtedness subordinated to the Obligations of the Borrower or any options, warrants, or
other rights to purchase such common stock or such Indebtedness, whether now or hereafter
outstanding; provided, that any Subsidiary may pay dividends to the Borrower or to its
parent company at any time.




          Section 7.5. Restrictive Agreements. The Borrower will not, and will not permit any
Subsidiary to, directly or indirectly, enter into, incur or permit to exist any agreement that
prohibits, restricts




22









 




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




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



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




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




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




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




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




ARTICLE VIII




EVENTS OF DEFAULT




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




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




23









 





          (b) the Borrower shall fail to pay any interest on any Revolving Loan or any fee or any other
amount (other than an amount payable under clause (a) of this Article) payable under this Agreement
or any other Loan Document, when and as the same shall become due and payable, and such failure
shall continue unremedied for a period of five (5) days; or




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




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




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




          (f) the Borrower or any Subsidiary (whether as primary obligor or as guarantor or other
surety) shall fail to pay any principal of or premium or interest on any Indebtedness owed to the
Bank (including without limitation any Hedging Agreement or any letter of credit) in any amount or
any other Indebtedness owed to any other Person 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; 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




24









 




other similar law now or hereafter in effect or (ii) the
appointment of a custodian, trustee, receiver, liquidator or other similar official for the
Borrower or any Subsidiary or for a substantial part of its assets, and in any such case, such
proceeding or petition shall remain undismissed for a period of 60 days or an order or decree
approving or ordering any of the foregoing shall be entered; or




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




          (j) an ERISA Event shall have occurred that, in the opinion of the Lender, when taken together
with other ERISA Events that 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
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 exist; or




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




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




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




          (q) the Borrower or any Financial Institution Subsidiary shall enter into a punitive written
agreement with any Governmental Authority having regulatory authority over such Person for any
reason;



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




25









 




automatically
terminate and the principal of the Revolving Loans then outstanding, together with accrued interest
thereon, and all fees, and all other Obligations shall automatically become due and payable,
without presentment, demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower.




ARTICLE IX




MISCELLANEOUS




          Section 9.1. Notices.




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




	 	 	 
	To the Borrower:

	 	Pinnacle Financial Partners, Inc.
	 

	 	211 Commerce Street, Suite 300
	 

	 	Nashville, Tennessee 37201
	 
	 	 
	 

	 	Attn: Harold R. Carpenter, Chief Financial Officer
	 

	 	Telephone Number: (615) 744-3742
	 

	 	Telecopy Number: (615) 744-3842
	 
	 	 
	With copy to:

	 	Bass Berry & Sim PLC
	 

	 	315 Deaderick Street, Suite 2700
	 

	 	Nashville, Tennessee 37238
	 
	 	 
	 

	 	Attn: Bob F. Thompson
	 

	 	Telephone Number: (615) 742-6262
	 

	 	Telecopy Number: (615) 742-2762
	 
	 	 
	To the Lender:

	 	SunTrust Bank
	 

	 	303 Peachtree Street, 3rd Floor
	 

	 	Atlanta, Georgia 30308
	 
	 	 
	 

	 	Attn: Susan Thigpen
	 

	 	Telephone Number: (404) 588-7270
	 

	 	Telecopy Number: (404) 581-1775





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




          (b) Any agreement of the Lender herein to receive certain notices by telephone or facsimile is
solely for the convenience and at the request of the Borrower. The Lender shall be entitled to
rely on the authority of any Person purporting to be a Person authorized by the Borrower to give
such notice and the Lender shall not have any liability to the Borrower or other Person on account
of any action taken or not




26









 




taken by the Lender in reliance upon such telephonic or facsimile
notice. The obligation of the Borrower to repay the Revolving Loans and all other Obligations
hereunder shall not be affected in any way or to any extent by any failure of the Lender to receive
written confirmation of any telephonic or facsimile notice or the receipt by the
Lender of a confirmation which is at variance with the terms understood by the Lender to be
contained in any such telephonic or facsimile notice.




          Section 9.2. Waiver; Amendments.




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




          (b) No amendment or waiver of any provision of this Agreement or the other Loan Documents, nor
consent to any departure by the Borrower therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Borrower and the Lender and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for which given.




          Section 9.3. Expenses; Indemnification.




          (a) The Borrower shall pay (i) all reasonable, out-of-pocket costs and expenses of the Lender
(including, without limitation, the reasonable fees, charges and disbursements of outside counsel
and the allocated cost of inside counsel not to exceed $2500) in connection with the preparation
and administration of the Loan Documents and any amendments, modifications or waivers thereof
(whether or not the transactions contemplated in this Agreement or any other Loan Document shall be
consummated), and (ii) all out-of-pocket costs and expenses (including, without limitation, the
reasonable fees, charges and disbursements of outside counsel and the allocated cost of inside
counsel) incurred by the Lender in connection with the enforcement or protection of its rights in
connection with this Agreement, including its rights under this Section, or in connection with the
Revolving Loans made hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Revolving Loans.




          (b) The Borrower shall indemnify the Lender and each Affiliate of the Lender, and each
officer, director, employee, agents and advisors of the Lender and each Affiliate of the Lender
(each, an “Indemnitee”) against, and hold each of them harmless from, any and all costs, losses,
liabilities, claims, damages and related expenses, including the 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 agreement or instrument
contemplated hereby, the performance by the parties hereto of their respective obligations
hereunder or the consummation of any of the transactions contemplated hereby, (ii) any Revolving
Loan or any actual or proposed use of the proceeds therefrom, (iii) 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 (iv) any





27












 




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.




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




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




          (e) All amounts due under this Section shall be payable promptly 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, except that the Borrower may not assign
or transfer any of its rights hereunder without the prior written consent of the Lender (and any
attempted assignment or transfer by the Borrower without such consent shall be null and void).




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




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




28









 







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




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




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




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




          (b) The Borrower hereby irrevocably and unconditionally submits, for itself and its property,
to the non-exclusive jurisdiction of any Federal and/or state court (including without limitation
the Business Case Division of the Fulton County Superior Court, if applicable) located in the
State of Georgia and any appellate court from any thereof, in any action or proceeding arising out
of or relating to this Agreement or any other Loan Document or the transactions contemplated hereby
or thereby, or for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such Georgia state court or, to the extent permitted by
applicable law, such Federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on
the judgment or in any other manner provided by law. Nothing in this Agreement or any other Loan
Document shall affect any right that the Lender may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against the Borrower or its
properties in the courts of any jurisdiction.




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




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




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




29









 








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




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




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




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




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




30









 




Section shall be
cumulated and the interest and Charges payable to the Lender in respect of other Revolving Loans or
periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount,
together with interest thereon at the Federal Funds Rate to the date of repayment, shall have been
received by the Lender.




          Section 9.12. 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.




[Remainder of Page Intentionally Left Blank]





31












 




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




	 	 	 	 	 
	 	PINNACLE FINANCIAL PARTNERS, INC.

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



	 	 	 	 	 
	 	[SEAL]


SUNTRUST BANK

 	 
	 	By  	 	 
	 	Name:	 	 	 
	 	Title:	 	 	 
	 




32









 








SCHEDULE 4.12




SUBSIDIARIES




	 	 	 
	 	 	Jurisdiction or State of
	Subsidiaries	 	Incorporation
	 
	 	 
	Pinnacle National Bank (1)

	 	Tennessee
	 
	 	 
	PrimeTrust Bank (1)

	 	Tennessee
	 
	 	 
	Bank of the South (1)

	 	Tennessee
	 
	 	 
	PFP Title Company (2)

	 	Tennessee
	 
	 	 
	Pinnacle Community Development Corporation (2)

	 	Tennessee
	 
	 	 
	PNFP Statutory Trust I (3)

	 	Connecticut
	 
	 	 
	PNFP Statutory Trust II (3)

	 	Delaware
	 
	 	 
	PNFP Statutory Trust III (3)

	 	Connecticut
	 
	 	 
	PNFP Statutory Trust IV (3)

	 	Delaware
	 
	 	 
	PNFP Holdings, Inc. (4)

	 	Nevada
	 
	 	 
	PNFP Properties, Inc. (5)

	 	Maryland
	 
	 	 
	Pinnacle Advisory Services, Inc. (6)

	 	Tennessee
	 
	 	 
	Pinnacle Credit Enhancement Services, Inc. (6)

	 	Tennessee
	 
	 	 
	Pinnacle Rutherford Real Estate, Inc. (2)

	 	Tennessee
	 
	 	 
	Pinnacle Nashville Real Estate, Inc. (2)

	 	Tennessee
	 
	 	 
	Pinnacle Rutherford Towers, Inc. (2)

	 	Tennessee
	 
	 	 
	Pinnacle Service Company, Inc.(2)

	 	Tennessee
	 
	 	 
	PNFP Insurance, Inc.(6)

	 	Nevada








 




			
	1.	 	As a national bank, Pinnacle National Bank is organized under the federal laws of the
United States of America. As Tennessee state-chartered banks, PrimeTrust Bank and Bank of
the South are organized under the laws of the State of Tennessee.
	 
	2.	 	PFP Title Company, Pinnacle Community Development Corporation, Pinnacle Rutherford Real
Estate, Inc., Pinnacle Nashville Real Estate, Inc., Pinnacle Rutherford Towers, Inc. and
Pinnacle Service Company, Inc. are wholly-owned subsidiaries of Pinnacle National Bank.
	 
	3.	 	PNFP Statutory Trust I, PNFP Statutory Trust II, PNFP Statutory Trust III and Statutory
Trust IV are statutory business trusts which were established to issue capital trust
preferred securities and with respect to which Pinnacle Financial Partners, Inc. owns 100%
of the common capital securities.
	 
	4.	 	PNFP Holdings, Inc. is a wholly-owned subsidiary of PFP Title Company.




 









 









			
	5.	 	PNFP Properties, Inc. is a wholly-owned subsidiary of PNFP Holdings, Inc.
	 
	6.	 	Pinnacle Advisory Services, Inc., Pinnacle Credit Enhancement Services, Inc. and PNFP
Insurance, Inc. are wholly owned subsidiaries of Pinnacle Financial Partners, Inc.





Schedule 4.12




 









 





SCHEDULE 7.1




OUTSTANDING INDEBTEDNESS




	 	1.	 	Approximately $9 million loan from Banker’s Bank, secured by a pledge of the common stock of Bank
of the South, to be repaid in full upon closing of the credit facility evidenced by this Agreement.
	 
	 	2.	 	Four (4) issuances of junior subordinated debentures, in the original amounts of $10 million, $20 million, $20 million and
$30 million, respectively, issued to wholly-owned statutory business trusts.





Schedule 7.1




 









 









EXHIBIT A




REVOLVING CREDIT NOTE




			
	 

$25,000,000.00
	 	Atlanta, Georgia               






February 28, 2008




     FOR VALUE RECEIVED, the undersigned, PINNACLE FINANCIAL PARTNERS, INC., a Tennessee
corporation (the “Borrower”), hereby promises to pay to SunTrust Bank (the “Lender”) or its
registered assigns at its principal office or any other office that the Lender designates, on the
Commitment Termination Date (as defined in the Revolving Credit Agreement dated as of February 28,
2008 (as the same may be amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), between the Borrower and the Lender, the lesser of the principal sum of Twenty Five
Million and no/100 Dollars ($25,000,000) and the aggregate unpaid principal amount of all Revolving
Loans made by the Lender to the Borrower pursuant to the Credit Agreement, in lawful money of the
United States of America in immediately available funds, and to pay interest from the date hereof
on the principal amount thereof from time to time outstanding, in like funds, at said office, at
the rate or rates per annum and payable on such dates as provided in the Credit Agreement. In
addition, should legal action or an attorney-at-law be utilized to collect any amount due
hereunder, the Borrower further promises to pay all costs of collection, including the reasonable
attorneys’ fees of the Lender.



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



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



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



	 	 	 	 	 
	 	PINNACLE FINANCIAL PARTNERS, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	  	 
	 
	 	 [SEAL] 	 	  	 
	 



Exhibit A-1




 









 








LOANS AND PAYMENTS




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Unpaid	 	 
	 	 	 	 	 	 	Principal	 	Name of Person
	 	 	Amount and	 	Payments of	 	Balance of	 	Making
	Date	 	Type of Loan	 	Principal	 	Note	 	Notation
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 





Exhibit A-2





 









 








EXHIBIT 2.2




SunTrust Bank

303 Peachtree Street, 3rd Floor

Atlanta, Georgia 30308




Attention:




Dear Sirs:




     Reference is made to the Revolving Credit Agreement dated as of [month] ___, 200___(as amended
and in effect on the date hereof, the “Credit Agreement”), between the undersigned, as Borrower,
and SunTrust Bank, as Lender. Terms defined in the Credit Agreement are used herein with the same
meanings. This notice constitutes a Notice of Borrowing, and the Borrower hereby requests a
Revolving Loan under the Credit Agreement, and in that connection the Borrower specifies the
following information with respect to the Revolving Loan requested hereby:




	 	(A)	 	Principal amount of Revolving Loan:                    
	 
	 	(B)	 	Date of Revolving Loan (which is a Business Day):                    
	 
	 	(C)	 	Purpose (if larger than $[amount to be determined]):                    
	 
	 	(D)	 	Location and number of Borrower’s account to which proceeds of Revolving Loan
are to be disbursed:                    





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



	 	 	 	 	 
	 	Very truly yours,


[name of Borrower]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Exhibit 2.2