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                                                                    EXHIBIT 10.6

            AGREEMENT AS TO EXPENSES AND LIABILITIES WITH RESPECT TO
                       SOUTHERN COMMUNITY CAPITAL TRUST I

         This Agreement as to Expenses and Liabilities (the "Agreement"), dated
as of February 13, 2002, is between Southern Community Financial Corporation, a
North Carolina corporation (the "Company"), and Southern Community Capital Trust
I, a Delaware statutory business trust (the "Trust").

         WHEREAS, the Trust intends to issue common securities (the "Common
Securities") to, and receive 7.25% Convertible Deferrable Interest Junior
Subordinated Debentures due March 31, 2032 (the "Debentures") from, the Company
and to issue and sell the 7.25% Cumulative Convertible Trust Preferred
Securities (the "Preferred Securities") with such powers, preferences and
special rights and restrictions as are set forth in the Amended and Restated
Trust Agreement of the Trust dated as of February 13, 2002, as the same may be
amended from time to time (the "Trust Agreement"); and

         WHEREAS, the Company will directly or indirectly own all of the Common
Securities of the Trust and will issue the Debentures.

         NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase the Company hereby agrees shall benefit the
Company and which purchase the Company acknowledges will be made in reliance
upon the execution and delivery of this Agreement, the Company, including in its
capacity as holder of the Common Securities, and the Trust hereby agree as
follows:

                                    ARTICLE I

         SECTION 1.01. GUARANTEE BY THE COMPANY. Subject to the terms and
conditions hereof, the Company, including in its capacity as holder of the
Common Securities, hereby irrevocably and unconditionally guarantees to each
person or entity to whom the Trust is now or hereafter becomes indebted or
liable (the "Beneficiaries") the full payment, when and as due, of any and all
Obligations (as hereinafter defined) to such Beneficiaries. As used herein,
"Obligations" means any costs, expenses or liabilities of the Trust other than
obligations of the Trust to pay to holders of any Preferred Securities or other
similar interests in the Trust the amounts due such holders pursuant to the
terms of the Preferred Securities or such other similar interests, as the case
may be. This Agreement is intended to be for the benefit of, and to be
enforceable by, all such Beneficiaries, whether or not such Beneficiaries have
received notice hereof.

         SECTION 1.02. TERM OF AGREEMENT. This Agreement shall terminate and be
of no further force and effect upon the later of: (a) the date on which full
payment has been made of all amounts payable to all holders of all the Preferred
Securities (whether upon redemption, liquidation, exchange or otherwise); or (b)
the date on which there are no Beneficiaries remaining; provided, however, that
this Agreement shall continue to be effective or shall be reinstated, as the
case may be, if at any time any holder of Preferred Securities or any
Beneficiary must restore payment of any sums paid under the Preferred
Securities, under any Obligation, under the Convertible Preferred Securities
Guarantee Agreement dated the date hereof by the Company and Property Trustee as
Guarantee Trustee (as defined in the Convertible Preferred Securities Guarantee
Agreement) or under this Agreement, for any reason whatsoever. This Agreement is
continuing, irrevocable, unconditional and absolute.

         SECTION 1.03. WAIVER OF NOTICE. The Company hereby waives notice of
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and the Company hereby waives presentment, demand for payment, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.

         SECTION 1.04. NO IMPAIRMENT. The obligations, covenants, agreements and
duties of the Company under this Agreement shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:


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                  (a) the extension of time for the payment by the Trust of all
         or any portion of the Obligations or for the performance of any other
         obligation under, arising out of, or in connection with, the
         Obligations;

                  (b) any failure, omission, delay or lack of diligence on the
         part of the Beneficiaries to enforce, assert or exercise any right,
         privilege, power or remedy conferred on the Beneficiaries with respect
         to the Obligations or any action on the part of the Trust granting
         indulgence or extension of any kind; or

                  (c) the voluntary or involuntary liquidation, dissolution,
         sale of any collateral, receivership, insolvency, bankruptcy,
         assignment for the benefit of creditors, reorganization, arrangement,
         composition or readjustment of debt of, or other similar proceedings
         affecting, the Trust or any of the assets of the Trust. The
         Beneficiaries shall not be obligated to give notice to, or obtain the
         consent of, the Company with respect to the happening of any of the
         foregoing.

         SECTION 1.05. ENFORCEMENT. A Beneficiary may enforce this Agreement
directly against the Company, and the Company waives any right or remedy to
require that any action be brought against the Trust or any other person or
entity before proceeding against the Company.

                                   ARTICLE II

         SECTION 2.01. BINDING EFFECT. All guarantees and agreements contained
in this Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Company and shall inure to the benefit of the
Beneficiaries.

         SECTION 2.02. AMENDMENT. So long as there remains any Beneficiary or
any Preferred Securities outstanding, this Agreement shall not be modified or
amended in any manner adverse to such Beneficiary or to the holders of the
Preferred Securities.

         SECTION 2.03. NOTICES. Any notice, request or other communication
required or permitted to be given hereunder shall be given in writing by
delivering the same by facsimile transmission (confirmed by mail) or by
registered or certified mail, addressed as follows (and if so given, shall be
deemed given when mailed):

                  Southern Community Capital Trust I
                  c/o Wilmington Trust Company
                  Rodney Square North
                  1100 North Market Street
                  Attention: Corporate Trust Services

                  Southern Community Financial Corporation
                  4701 Country Club Road
                  Winston-Salem, NC 27012
                  Attention: F. Scott Bauer

         SECTION 2.04. GOVERNING LAW. This Agreement shall be governed by and
construed and interpreted in accordance with the laws of the State of North
Carolina (without regard to conflict of laws principles).

         THIS AGREEMENT is executed as of the day and year first above written.


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                             SOUTHERN COMMUNITY FINANCIAL CORPORATION



                             By: /s/ F. Scott Bauer
                                 -------------------------------------------
                                 F. Scott Bauer
                                 President and Chief Executive Officer

                             SOUTHERN COMMUNITY CAPITAL TRUST I



                             By: /s/ F. Scott Bauer
                                 -------------------------------------------
                                 F. Scott Bauer, Administrative Trustee



                             By: /s/ Richard Cobb
                                 -------------------------------------------
                                 Richard Cobb, Administrative Trustee



                             By: /s/ Jeff T. Clark
                                 -------------------------------------------
                                 Jeff T. Clark, Administrative Trustee


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