##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 
 Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
 For the quarterly period ended:
 September 30, 2010
 Commission File Number: 000-11448
 NewBridge Bancorp
 (Exact name of Registrant as specified in its Charter)
 North Carolina
    
    56-1348147(State of Incorporation)
    
    (I.R.S. Employer Identification No.)1501 Highwoods Boulevard, Suite 400Greensboro, North Carolina
    
    27410(Address of principal executive offices)
    
    (Zip Code)
 (336) 369-0900
(Registrants telephone number, including area code)
 
 þ o
 o o
  Large accelerated filer o
Accelerated filer o
Non-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting
company þ o þ
 At November 5, 2010, 15,655,868 shares of the registrants common stock were outstanding.




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##### 



PagePART IFinancial InformationItem 1
    
    Financial Statements
    
    
    3Consolidated Balance Sheets September 30, 2010 and December 31, 2009
    
    
    3Consolidated Statements of Income Three Months and Nine Months
Ended September 30, 2010 and 2009
    
    
    4Consolidated Statements of Changes in Shareholders Equity and Comprehensive
Income Nine Months Ended September 30, 2010 and 2009
    
    
    5Consolidated Statements of Cash Flows Nine Months Ended September 30, 2010 and 2009
    
    
    6Notes to Consolidated Financial Statements
    
    
    8Item 2
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    14Item 3
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    26Item 4
    
    Controls and Procedures
    
    
    26PART II  Other InformationItem 1
    
    Legal Proceedings
    
    
    27Item 1A
    
    Risk Factors
    
    
    27Item 2
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    27Item 3
    
    Defaults Upon Senior Securities
    
    
    27Item 4
    
    Removed and Reserved
    
    
    27Item 5
    
    Other Information
    
    
    27Item 6
    
    Exhibits
    
    
    28EX-31.1EX-31.2EX-32
  2




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##### Table of Contents



PART I
FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements.
 
 NewBridge Bancorp and Subsidiary
Consolidated Balance Sheets  (Dollars in thousands, except per share data)
 September 302010
    
    
    December 31(Unaudited)
    
    
    2009AssetsCash and due from banks
    
    $
    29,672
    
    
    $
    29,674Interest-bearing bank balances
    
    
    75,436
    
    
    
    15,166Investment securities:Held to maturity, market value $0 at September 30, 2010
and $20,487 at December 31, 2009
    
    
    
    
    
    
    19,957Available for sale
    
    
    275,571
    
    
    
    305,382Loans held for sale
    
    
    17,793
    
    
    
    6,568Loans
    
    
    1,355,634
    
    
    
    1,456,526Less allowance for credit losses
    
    
    (35,554
    )
    
    
    (35,843
    )Net loans
    
    
    1,337,873
    
    
    
    1,427,251Premises and equipment
    
    
    38,657
    
    
    
    40,405Real estate acquired in settlement of loans
    
    
    29,571
    
    
    
    27,337Bank-owned life insurance
    
    
    29,420
    
    
    
    28,614Deferred tax assets
    
    
    24,745
    
    
    
    26,022Other assets
    
    
    21,967
    
    
    
    26,718Total assets
    
    $
    1,862,912
    
    
    $
    1,946,526LiabilitiesDeposits:Non-interest bearing
    
    $
    158,290
    
    
    $
    156,040Savings, NOW and money market accounts
    
    
    792,036
    
    
    
    668,875Certificates of deposit
    
    
    560,267
    
    
    
    674,395Total deposits
    
    
    1,510,593
    
    
    
    1,499,310Borrowings from the Federal Home Loan Bank
    
    
    97,700
    
    
    
    165,200Other borrowings
    
    
    71,774
    
    
    
    99,374Accrued expenses and other liabilities
    
    
    16,245
    
    
    
    18,038Total liabilities
    
    
    1,696,312
    
    
    
    1,781,922Shareholders EquityPreferred stock, par value $.01 per share:Authorized 10,000,000 shares; issued and outstanding
(liquidation preference $1,000 per share)  52,372 at
September 30, 2010 and at December 31, 2009
    
    
    51,415
    
    
    
    51,190Common stock, par value $5 per share:Authorized 50,000,000 shares; issued and outstanding 

15,655,868 at September 30, 2010 and at December 31, 2009
    
    
    78,279
    
    
    
    78,279Paid-in capital
    
    
    87,030
    
    
    
    86,969Directors deferred compensation plan
    
    
    (618
    )
    
    
    (634
    )Retained deficit
    
    
    (52,407
    )
    
    
    (52,477
    )Accumulated other comprehensive income
    
    
    2,901
    
    
    
    1,277Total shareholders equity
    
    
    166,600
    
    
    
    164,604Total liabilities and shareholders equity
    
    $
    1,862,912
    
    
    $
    1,946,526
 See notes to consolidated financial statements
 3




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##### Table of Contents



NewBridge Bancorp and Subsidiary
Consolidated Statements of Income  (Unaudited; dollars in thousands, except per share data)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302010
    
    
    2009
    
    
    2010
    
    
    2009Interest IncomeInterest and fees on loans
    
    $
    18,545
    
    
    $
    20,735
    
    
    $
    56,926
    
    
    $
    63,990Interest on investment securities:Taxable
    
    
    2,895
    
    
    
    2,479
    
    
    
    8,529
    
    
    
    6,750Tax exempt
    
    
    959
    
    
    
    1,209
    
    
    
    3,132
    
    
    
    3,614Interest-bearing bank balances
    
    
    20
    
    
    
    31
    
    
    
    54
    
    
    
    116Federal funds sold
    
    
    
    
    
    
    17
    
    
    
    
    
    
    
    97Total interest income
    
    
    22,419
    
    
    
    24,471
    
    
    
    68,641
    
    
    
    74,567Interest ExpenseDeposits
    
    
    3,556
    
    
    
    7,649
    
    
    
    11,841
    
    
    
    26,226Borrowings from the Federal Home Loan Bank
    
    
    520
    
    
    
    1,172
    
    
    
    2,639
    
    
    
    3,515Other borrowings
    
    
    617
    
    
    
    620
    
    
    
    1,822
    
    
    
    1,949Total interest expense
    
    
    4,693
    
    
    
    9,441
    
    
    
    16,302
    
    
    
    31,690Net interest income
    
    
    17,726
    
    
    
    15,030
    
    
    
    52,339
    
    
    
    42,877Provision for credit losses
    
    
    7,965
    
    
    
    10,808
    
    
    
    16,616
    
    
    
    30,179Net interest income after provision for credit losses
    
    
    9,761
    
    
    
    4,222
    
    
    
    35,723
    
    
    
    12,698Noninterest IncomeService charges on deposit accounts
    
    
    1,902
    
    
    
    2,189
    
    
    
    5,706
    
    
    
    6,427Fee income
    
    
    966
    
    
    
    983
    
    
    
    3,228
    
    
    
    2,872Mortgage banking services
    
    
    742
    
    
    
    104
    
    
    
    1,453
    
    
    
    489Gain on sale of investment securities
    
    
    3,637
    
    
    
    
    
    
    
    3,637
    
    
    
    Loss on sale of real estate acquired in
settlement of loans
    
    
    (417
    )
    
    
    (309
    )
    
    
    (1,309
    )
    
    
    (543
    )Other
    
    
    869
    
    
    
    2,628
    
    
    
    2,673
    
    
    
    5,049Total noninterest income
    
    
    7,699
    
    
    
    5,595
    
    
    
    15,388
    
    
    
    14,294Noninterest ExpensePersonnel
    
    
    7,421
    
    
    
    8,304
    
    
    
    22,745
    
    
    
    23,625Occupancy
    
    
    1,035
    
    
    
    2,097
    
    
    
    3,210
    
    
    
    4,411Furniture and equipment
    
    
    1,159
    
    
    
    2,335
    
    
    
    3,510
    
    
    
    4,891FDIC insurance
    
    
    833
    
    
    
    965
    
    
    
    2,633
    
    
    
    3,870Other real estate acquired in settlement of loans,
including writedowns
    
    
    1,645
    
    
    
    850
    
    
    
    3,512
    
    
    
    1,246Other
    
    
    4,219
    
    
    
    5,267
    
    
    
    12,990
    
    
    
    15,852Total noninterest expense
    
    
    16,312
    
    
    
    19,818
    
    
    
    48,600
    
    
    
    53,895Income (loss) before income taxes
    
    
    1,148
    
    
    
    (10,001
    )
    
    
    2,511
    
    
    
    (26,903
    )Income taxes
    
    
    115
    
    
    
    (4,347
    )
    
    
    251
    
    
    
    (11,719
    )Net Income (Loss)
    
    
    1,033
    
    
    
    (5,654
    )
    
    
    2,260
    
    
    
    (15,184
    )Dividends and accretion on preferred stock
    
    
    (730
    )
    
    
    (729
    )
    
    
    (2,190
    )
    
    
    (2,188
    )Net Income (Loss) available to common shareholders
    
    $
    303
    
    
    $
    (6,383
    )
    
    $
    70
    
    
    $
    (17,372
    )Earnings (loss) per share:Basic
    
    $
    0.02
    
    
    $
    (0.41
    )
    
    $
    0.00
    
    
    $
    (1.11
    )Diluted
    
    $
    0.02
    
    
    $
    (0.41
    )
    
    $
    0.00
    
    
    $
    (1.11
    )Weighted average shares outstanding:Basic
    
    
    15,655,868
    
    
    
    15,655,868
    
    
    
    15,655,868
    
    
    
    15,655,868Diluted
    
    
    16,019,719
    
    
    
    15,655,868
    
    
    
    16,025,102
    
    
    
    15,655,868
 See notes to consolidated financial statements
 4




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##### Table of Contents



NewBridge Bancorp and Subsidiary
Consolidated Statements of Changes in Shareholders Equity and Comprehensive Income
 (Unaudited; Dollars in thousands)
 Directors
    
    
    
    
    
    
    AccumulatedDeferred
    
    
    Retained
    
    
    Other
    
    
    TotalPreferred
    
    
    Common Stock
    
    
    Paid-in
    
    
    Compensation
    
    
    Earnings
    
    
    Comprehensive
    
    
    ShareholdersStock
    
    
    Shares
    
    
    Amount
    
    
    Capital
    
    
    Plan
    
    
    (Deficit)
    
    
    Income (Loss)
    
    
    EquityBalances at December 31, 2008
    
    $
    50,891
    
    
    
    15,655,868
    
    
    $
    78,279
    
    
    $
    86,852
    
    
    $
    (650
    )
    
    $
    (34,427
    )
    
    $
    (1,709
    )
    
    $
    179,236Net Loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,184
    )
    
    
    
    
    
    
    (15,184
    )Change in unrealized gain on
securities available for
sale, net of deferred
income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,204
    
    
    
    4,204Comprehensive income (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,980
    )Dividends and accretion on
preferred stock
    
    
    224
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,188
    )
    
    
    
    
    
    
    (1,964
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    89
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    89Common stock distributed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16
    
    
    
    
    
    
    
    
    
    
    
    16Balances at September 30, 2009
    
    $
    51,115
    
    
    
    15,655,868
    
    
    $
    78,279
    
    
    $
    86,941
    
    
    $
    (634
    )
    
    $
    (51,799
    )
    
    $
    2,495
    
    
    $
    166,397Balances at December 31, 2009
    
    $
    51,190
    
    
    
    15,655,868
    
    
    $
    78,279
    
    
    $
    86,969
    
    
    $
    (634
    )
    
    $
    (52,477
    )
    
    $
    1,277
    
    
    $
    164,604Net Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,260
    
    
    
    
    
    
    
    2,260Change in unrealized gain on
securities available for
sale, net of deferred
income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,624
    
    
    
    1,624Comprehensive income (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,884Dividends and accretion on
preferred stock
    
    
    225
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,190
    )
    
    
    
    
    
    
    (1,965
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    61
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    61Common stock distributed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16
    
    
    
    
    
    
    
    
    
    
    
    16Balances at September 30, 2010
    
    $
    51,415
    
    
    
    15,655,868
    
    
    $
    78,279
    
    
    $
    87,030
    
    
    $
    (618
    )
    
    $
    (52,407
    )
    
    $
    2,901
    
    
    $
    166,600
 See notes to consolidated financial statements
 5




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##### Table of Contents



NewBridge Bancorp and Subsidiary
Consolidated Statements of Cash Flows  (Unaudited; dollars in thousands)
 Nine Months EndedSeptember 302010
    
    
    2009Cash Flow from operating activitiesNet Income (Loss)
    
    $
    2,260
    
    
    $
    (15,184
    )Adjustments to reconcile net income (loss) to net cash provided
by operating activities:Depreciation and amortization
    
    
    5,255
    
    
    
    5,540(Increase) decrease in deferred income taxes
    
    
    1,371
    
    
    
    (5,605
    )(Increase) decrease in income taxes receivable
    
    
    2,717
    
    
    
    (2,629
    )(Increase) decrease in income earned but not received
    
    
    1,283
    
    
    
    (96
    )Decrease in interest accrued but not paid
    
    
    (569
    )
    
    
    (606
    )Net decrease in other assets
    
    
    2,648
    
    
    
    399Net increase (decrease) in other liabilities
    
    
    (1,176
    )
    
    
    1,125Provision for credit losses
    
    
    16,616
    
    
    
    30,179Gain on sale of loans held for sale
    
    
    (1,453
    )
    
    
    (489
    )Originations of loans held for sale
    
    
    (136,707
    )
    
    
    (67,669
    )Proceeds from sales of loans held for sale
    
    
    126,935
    
    
    
    67,552Loss on sale of premises, equipment and real estate acquired
in settlement of loans
    
    
    1,457
    
    
    
    523Stock based compensation
    
    
    61
    
    
    
    89Net cash provided by operating activities
    
    
    20,698
    
    
    
    13,129Cash Flow from investing activitiesPurchases of securities available for sale
    
    
    (101,500
    )
    
    
    (106,754
    )Purchases of securities held to maturity
    
    
    (39,160
    )
    
    
    Proceeds from sales, calls and maturities of securities
available for sale
    
    
    190,165
    
    
    
    58,372Net decrease in loans made to customers
    
    
    65,044
    
    
    
    63,081Proceeds from sale of premises, equipment and real estate acquired
in settlement of loans
    
    
    13,321
    
    
    
    8,487Expenditures for improvements to real estate acquired
in settlement of loans, net of receipts
    
    
    37
    
    
    
    (1,105
    )Purchases of premises and equipment
    
    
    (2,523
    )
    
    
    (416
    )Net decrease in federal funds sold
    
    
    
    
    
    
    42,043Net cash provided by investing activities
    
    
    125,384
    
    
    
    63,708Cash Flow from financing activitiesNet increase in demand deposits, NOW, money
market and savings accounts
    
    
    125,410
    
    
    
    25,327Net decrease in time deposits
    
    
    (114,128
    )
    
    
    (76,232
    )Net decrease in other borrowings
    
    
    (27,647
    )
    
    
    (3,557
    )Net decrease in borrowings from Federal
Home Loan Bank
    
    
    (67,500
    )
    
    
    (2,300
    )Dividends paid
    
    
    (1,964
    )
    
    
    (1,964
    )Common stock distributed
    
    
    15
    
    
    
    17Net cash used for financing activities
    
    
    (85,814
    )
    
    
    (58,709
    )Increase in cash and cash equivalents
    
    
    60,268
    
    
    
    18,128Cash and cash equivalents at the beginning of the period
    
    
    44,840
    
    
    
    45,817Cash and cash equivalents at the end of the period
    
    $
    105,108
    
    
    $
    63,945
 See notes to consolidated financial statements
 6




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##### Table of Contents



NewBridge Bancorp and Subsidiary
Consolidated Statements of Cash Flows (continued)  (Unaudited; dollars in thousands)
 Nine Months EndedSeptember 302010
    
    2009Supplemental disclosures of cash flow informationCash paid during the periods for:Interest
    
    $
    16,871
    
    
    $
    31,084Income Taxes
    
    
    
    
    
    
    Supplemental disclosures of noncash transactionsTransfer of loans to real estate acquired
in settlement of loans
    
    $
    18,089
    
    
    $
    16,451Transfer of investment securities from Held to Maturity
to Available for Sale
    
    
    27,389
    
    
    
    Accretion on preferred stock
    
    
    225
    
    
    
    224Dividends accrued but unpaid
    
    
    327
    
    
    
    194Unrealized gains/(losses) on securities available for sale:Change in securities available for sale
    
    
    (855
    )
    
    
    6,414Change in deferred income taxes
    
    
    (769
    )
    
    
    (2,210
    )Change in shareholders equity
    
    
    1,624
    
    
    
    4,204
 See notes to consolidated financial statements
 7




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##### Table of Contents



Notes to Consolidated Financial Statements  (Unaudited)
 Note 1  Basis of Presentation
      Note 2  Net Income Per Share
  8




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##### Table of Contents



Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302010
    
    
    2009
    
    
    2010
    
    
    2009Weighted average number of common shares used in
computing basic net income per share
    
    
    15,655,868
    
    
    
    15,655,868
    
    
    
    15,655,868
    
    
    
    15,655,868Effect of dilutive stock options, warrants and
restricted stock grants
    
    
    363,851
    
    
    
    
    
    
    
    369,234
    
    
    
    Diluted weighted average common shares outstanding
    
    
    16,019,719
    
    
    
    15,655.868
    
    
    
    16,025,102
    
    
    
    15,655,868
 Note 3  Investment Securities
  September 30, 2010  Securities Available for SaleAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    ValueU.S. Treasury securities
    
    $
    12,999
    
    
    $
    
    
    
    $
    
    
    
    $
    12,999U.S. government agency securities
    
    
    37,000
    
    
    
    262
    
    
    
    
    
    
    
    37,262Mortgage backed securities
    
    
    62,425
    
    
    
    4,886
    
    
    
    
    
    
    
    67,311State and municipal obligations
    
    
    17,401
    
    
    
    226
    
    
    
    (466
    )
    
    
    17,161Corporate bonds
    
    
    74,139
    
    
    
    3,755
    
    
    
    (12
    )
    
    
    77,882Collateralized mortgage obligations
    
    
    44,983
    
    
    
    716
    
    
    
    (101
    )
    
    
    45,598Federal Home Loan Bank stock
    
    
    10,806
    
    
    
    
    
    
    
    
    
    
    
    10,806Other equity securities
    
    
    5,775
    
    
    
    797
    
    
    
    (20
    )
    
    
    6,552Total
    
    $
    265,528
    
    
    $
    10,642
    
    
    $
    (599
    )
    
    $
    275,571
 December 31, 2009  Securities Held to MaturityAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    ValueState and municipal obligations
    
    $
    19,957
    
    
    $
    550
    
    
    $
    (20
    )
    
    $
    20,487
 December 31, 2009  Securities Available for SaleAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    ValueU.S. government agency securities
    
    $
    49,005
    
    
    $
    529
    
    
    $
    (15
    )
    
    $
    49,519Mortgage backed securities
    
    
    77,430
    
    
    
    4,260
    
    
    
    
    
    
    
    81,690State and municipal obligations
    
    
    85,212
    
    
    
    1,747
    
    
    
    (1,452
    )
    
    
    85,507Corporate bonds
    
    
    33,978
    
    
    
    1,626
    
    
    
    
    
    
    
    35,604Collateralized mortgage obligations
    
    
    35,124
    
    
    
    346
    
    
    
    (102
    )
    
    
    35,368Federal Home Loan Bank stock
    
    
    11,414
    
    
    
    
    
    
    
    
    
    
    
    11,414Other equity securities
    
    
    5,775
    
    
    
    725
    
    
    
    (220
    )
    
    
    6,280Total
    
    $
    297,938
    
    
    $
    9,233
    
    
    $
    (1,789
    )
    
    $
    305,382
 9




---



##### Table of Contents



Less than 1 year
    
    
    1 Year or More
    
    
    TotalMarket
    
    
    Unrealized
    
    
    Market
    
    
    Unrealized
    
    
    Market
    
    
    UnrealizedValue
    
    
    Loss
    
    
    Value
    
    
    Loss
    
    
    Value
    
    
    LossState and municipal obligations
    
    $
    1,091
    
    
    $
    (6
    )
    
    $
    5,654
    
    
    $
    (460
    )
    
    $
    6,745
    
    
    $
    (466
    )Corporate bonds
    
    
    4,970
    
    
    
    (12
    )
    
    
    
    
    
    
    
    
    
    
    4,970
    
    
    
    (12
    )Collateralized mortgage obligations
    
    
    4,071
    
    
    
    (101
    )
    
    
    
    
    
    
    
    
    
    
    4,071
    
    
    
    (101
    )Other equity securities
    
    
    
    
    
    
    
    
    
    
    839
    
    
    
    (20
    )
    
    
    839
    
    
    
    (20
    )Total securities
    
    $
    10,132
    
    
    $
    (119
    )
    
    $
    6,493
    
    
    $
    (480
    )
    
    $
    16,625
    
    
    $
    (599
    )
   Note 4  Loans, Nonperforming Assets and Allowance for Credit Loss
  September 30
    
    
    December 312010
    
    
    2009Commercial
    
    $
    562,594
    
    
    $
    593,423Real estate  construction
    
    
    149,886
    
    
    
    177,285Real estate  mortgage
    
    
    571,428
    
    
    
    598,492Consumer
    
    
    58,996
    
    
    
    75,469Other
    
    
    12,730
    
    
    
    11,857Total loans
    
    
    1,355,634
    
    
    
    1,456,526Loans held for sale
    
    
    17,793
    
    
    
    6,568Total loans and loans held for sale
    
    $
    1,373,427
    
    
    $
    1,463,094
 10




---



##### Table of Contents



September 30
    
    
    December 312010
    
    
    2009Commercial nonaccrual loans, not restructured
    
    $
    28,699
    
    
    $
    46,788Commercial nonaccrual loans, restructured
    
    
    8,338
    
    
    
    1,777Non-commercial nonaccrual loans
    
    
    7,828
    
    
    
    4,772Total nonaccrual loans
    
    
    44,865
    
    
    
    53,337Troubled debt restructured, accruing
    
    
    5,865
    
    
    
    1,442Accruing loans which are contractually
past due 90 days or more
    
    
    1,290
    
    
    
    3,450Total nonperforming loans
    
    
    52,020
    
    
    
    58,229Real estate acquired in settlement of loans
    
    
    29,571
    
    
    
    27,337Total nonperforming assets
    
    $
    81,591
    
    
    $
    85,566Nonperforming loans to loans outstanding at
end of period
    
    
    3.79
    %
    
    
    3.98
    %Nonperforming assets to total assets at end of period
    
    
    4.38
    %
    
    
    4.40
    %Allowance for credit losses to non-performing loans
    
    
    68.35
    %
    
    
    61.56
    %
  September 30
    
    
    December 312010
    
    
    2009Loans specifically identified as impairedCommercial and real estate
    
    $
    167,518
    
    
    $
    118,771Consumer
    
    
    2,569
    
    
    
    6,183Total
    
    $
    170,087
    
    
    $
    124,954Allowance for credit losses associated with
impaired loans
    
    $
    15,346
    
    
    $
    16,723Previous writedowns on impaired loans
    
    $
    8,963
    
    
    $
    11,918
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302010
    
    
    2009
    
    
    2010
    
    
    2009Average balances of impaired loans
    
    $
    159,497
    
    
    $
    109,029
    
    
    $
    147,941
    
    
    $
    100,633Interest income recorded for impaired loans
    
    $
    1,126
    
    
    $
    832
    
    
    $
    3,727
    
    
    $
    2,344
   Nine Months EndedSeptember 302010
    
    
    2009Balance, beginning of period
    
    $
    35,843
    
    
    $
    35,805Provision for credit losses
    
    
    16,616
    
    
    
    30,179Net charge-offs
    
    
    (16,905
    )
    
    
    (27,082
    )Balance, end of period
    
    $
    35,554
    
    
    $
    38,092
  11




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##### Table of Contents



Note 5  Recent Accounting Pronouncements
  Note 6  Stock Compensation Plans
   12




---



##### Table of Contents



Note 7  Fair Value of Financial Instruments
  Quoted pricesin active markets
    
    Significant other
    
    Significantfor identical
    
    observable inputs
    
    unobservable inputsassets (Level 1)
    
    (Level 2)
    
    (Level 3)Available for sale securities at September 30, 2010
    
    $
    244,409
    
    
    $
    17,161
    
    
    $
    Available for sale securities at December 31, 2009
    
    
    219,875
    
    
    
    85,507
    
    
    
    
  Quoted pricesin active markets
    
    Significant other
    
    Significantfor identical
    
    observable inputs
    
    unobservable inputsassets (Level 1)
    
    (Level 2)
    
    (Level 3)Mortgage loans held for sale at September 30, 2010
    
    $
    
    
    
    $
    17,793
    
    
    $
    Mortgage loans held for sale at December 31, 2009
    
    
    
    
    
    
    6,568
    
    
    
    Real estate acquired in settlement of loans at
September 30, 2010
    
    
    
    
    
    
    
    
    
    
    29,571Real estate acquired in settlement of loans at
December 31, 2009
    
    
    
    
    
    
    
    
    
    
    27,337Core deposit intangible at September 30, 2010
    
    
    
    
    
    
    
    
    
    
    4,708Core deposit intangible at December 31, 2009
    
    
    
    
    
    
    
    
    
    
    5,252Impaired loans net of allowance at September 30, 2010
    
    
    
    
    
    
    
    
    
    
    154,741Impaired loans net of allowance at December 31, 2009
    
    
    
    
    
    
    
    
    
    
    108,231
 Note 8  U.S. Treasury Capital Purchase Program
  13




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
    14




---



##### Table of Contents



Introduction
     Application of Critical Accounting Policies
  15




---



##### Table of Contents



Three Months Ended September 30, 2010 Compared to Three Months Ended September 30, 2009
 Net Interest Income
    16




---



##### Table of Contents



1
 Three Months Ended
    
    
    Three Months EndedSeptember 30, 2010
    
    
    September 30, 2009Interest
    
    
    Annualized
    
    
    
    
    
    
    Interest
    
    
    AnnualizedAverage
    
    
    Income/
    
    
    Average
    
    
    Average
    
    
    Income/
    
    
    AverageBalance
    
    
    Expense
    
    
    Yield/Rate
    
    
    Balance
    
    
    Expense
    
    
    Yield/RateEarning assets:Loans receivable2
    
    $
    1,391,390
    
    
    $
    18,545
    
    
    
    5.29
    %
    
    $
    1,518,257
    
    
    $
    20,736
    
    
    
    5.42
    %Taxable securities
    
    
    244,483
    
    
    
    2,882
    
    
    
    4.68
    
    
    
    203,993
    
    
    
    2,478
    
    
    
    4.82Tax exempt securities
    
    
    77,598
    
    
    
    1,403
    
    
    
    7.17
    
    
    
    107,410
    
    
    
    1,728
    
    
    
    6.38Equity securities
    
    
    11,113
    
    
    
    13
    
    
    
    0.46
    
    
    
    11,190
    
    
    
    
    
    
    
    0.00Interest-bearing bank balances
    
    
    37,264
    
    
    
    20
    
    
    
    0.22
    
    
    
    39,129
    
    
    
    31
    
    
    
    0.31Federal funds sold
    
    
    
    
    
    
    
    
    
    
    0.00
    
    
    
    6,809
    
    
    
    17
    
    
    
    0.99Total earning assets
    
    
    1,761,848
    
    
    
    22,863
    
    
    
    5.15
    
    
    
    1,886,788
    
    
    
    24,990
    
    
    
    5.25Non-earning assets:Cash and due from banks
    
    
    27,909
    
    
    
    
    
    
    
    
    
    
    
    31,362Premises and equipment
    
    
    39,198
    
    
    
    
    
    
    
    
    
    
    
    42,687Other assets
    
    
    103,823
    
    
    
    
    
    
    
    
    
    
    
    101,751Allowance for credit losses
    
    
    (34,656
    )
    
    
    
    
    
    
    
    
    
    
    (44,401
    )Total assets
    
    $
    1,898,122
    
    
    
    22,863
    
    
    
    
    
    
    $
    2,018,187
    
    
    
    24,990Interest-bearing liabilities:Savings deposits
    
    $
    40,097
    
    
    
    10
    
    
    
    0.10
    %
    
    $
    41,016
    
    
    
    10
    
    
    
    0.10
    %NOW deposits
    
    
    394,645
    
    
    
    867
    
    
    
    0.87
    
    
    
    184,194
    
    
    
    132
    
    
    
    0.28Money market deposits
    
    
    343,335
    
    
    
    672
    
    
    
    0.78
    
    
    
    392,633
    
    
    
    935
    
    
    
    0.94Time deposits
    
    
    590,880
    
    
    
    2,007
    
    
    
    1.35
    
    
    
    851,089
    
    
    
    6,571
    
    
    
    3.06Other borrowings
    
    
    72,628
    
    
    
    617
    
    
    
    3.37
    
    
    
    72,017
    
    
    
    620
    
    
    
    3.42Borrowings from Federal
Home Loan Bank
    
    
    106,129
    
    
    
    520
    
    
    
    1.94
    
    
    
    128,537
    
    
    
    1,172
    
    
    
    3.62Total interest-bearing liabilities
    
    
    1,547,714
    
    
    
    4,693
    
    
    
    1.20
    
    
    
    1,669,486
    
    
    
    9,440
    
    
    
    2.24Other liabilities and shareholders
equity:Demand deposits
    
    
    165,951
    
    
    
    
    
    
    
    
    
    
    
    157,889Other liabilities
    
    
    16,660
    
    
    
    
    
    
    
    
    
    
    
    22,870Shareholders equity
    
    
    167,797
    
    
    
    
    
    
    
    
    
    
    
    167,942Total liabilities and shareholders
equity
    
    $
    1,898,122
    
    
    
    4,693
    
    
    
    
    
    
    $
    2,018,187
    
    
    
    9,440Net interest income and net
interest margin3
    
    
    
    
    
    $
    18,170
    
    
    
    4.09
    %
    
    
    
    
    
    $
    15,550
    
    
    
    3.27
    %Interest rate spread4
    
    
    
    
    
    
    
    
    
    
    3.95
    %
    
    
    
    
    
    
    
    
    
    
    3.01
    %
 
 1
    
    Income related to securities exempt from federal income taxes is stated on a fully
taxable-equivalent basis, assuming a federal income tax rate of 35%, and is then reduced by
the non-deductible portion of interest expense. The adjustments made to convert to a fully
taxable equivalent basis were $444 for 2010 and $519 for
2009.2
    
    The average loans receivable balances include non-accruing loans. Amortization of
loan fees, net of deferred costs, of $339 and $313 for the three months ended September 30,
2010 and 2009, respectively, are included in interest income.3
    
    Net interest margin is computed by dividing net interest income by average earning
assets.4
    
    Earning assets yield minus
interest-bearing liability rate. 17




---



##### Table of Contents



Noninterest Income and Expense
    Other Operating Income and Expenses (in thousands)
 Three Months EndedSeptember 30,
    
    
    Percentage2010
    
    
    2009
    
    
    VarianceOther operating income:Bankcard income
    
    $
    160
    
    
    $
    643
    
    
    
    (75.1
    )%Investment services commissions
    
    
    392
    
    
    
    345
    
    
    
    13.6Insurance commissions
    
    
    12
    
    
    
    16
    
    
    
    (26.6
    )Trust income
    
    
    128
    
    
    
    135
    
    
    
    (5.2
    )Gain on sale of merchant services portfolio
    
    
    
    
    
    
    1,177
    
    
    NMIncome on bank-owned life insurance
    
    
    222
    
    
    
    156
    
    
    
    42.3Other income (loss)
    
    
    (45
    )
    
    
    156
    
    
    NM$
    869
    
    
    $
    2,628
    
    
    
    (66.9
    )Other operating expenses:Advertising
    
    $
    395
    
    
    $
    374
    
    
    
    5.6
    %Automated services
    
    
    1,038
    
    
    
    1,434
    
    
    
    (27.6
    )Bankcard expense
    
    
    126
    
    
    
    598
    
    
    
    (78.9
    )Legal and professional fees
    
    
    686
    
    
    
    771
    
    
    
    (11.0
    )Postage
    
    
    303
    
    
    
    206
    
    
    
    47.2Stationery, printing and supplies
    
    
    160
    
    
    
    53
    
    
    
    202.7Other expense
    
    
    1,511
    
    
    
    1,831
    
    
    
    (17.5
    )$
    4,219
    
    
    $
    5,267
    
    
    
    (19.9
    )
 18




---



##### Table of Contents



Nine Months Ended September 30, 2010 Compared to Nine Months Ended September 30, 2009
 Net Interest Income
   19




---



##### Table of Contents



1
 Nine Months Ended
    
    
    Nine Months EndedSeptember 30, 2010
    
    
    September 30, 2009Interest
    
    
    Annualized
    
    
    
    
    
    
    Interest
    
    
    AnnualizedAverage
    
    
    Income/
    
    
    Average
    
    
    Average
    
    
    Income/
    
    
    AverageBalance
    
    
    Expense
    
    
    Yield/Rate
    
    
    Balance
    
    
    Expense
    
    
    Yield/RateEarning assets:Loans receivable2
    
    $
    1,422,947
    
    
    $
    56,926
    
    
    
    5.35
    %
    
    $
    1,555,566
    
    
    $
    63,990
    
    
    
    5.50
    %Taxable securities
    
    
    249,695
    
    
    
    8,501
    
    
    
    4.55
    
    
    
    189,333
    
    
    
    6,749
    
    
    
    4.77Tax exempt securities
    
    
    82,392
    
    
    
    4,567
    
    
    
    7.41
    
    
    
    110,349
    
    
    
    5,116
    
    
    
    6.20Equity securities
    
    
    11,458
    
    
    
    28
    
    
    
    0.33
    
    
    
    11,161
    
    
    
    4
    
    
    
    0.05Interest-bearing bank balances
    
    
    28,046
    
    
    
    54
    
    
    
    0.26
    
    
    
    64,738
    
    
    
    112
    
    
    
    0.23Federal funds sold
    
    
    
    
    
    
    
    
    
    
    0.00
    
    
    
    25,071
    
    
    
    97
    
    
    
    0.52Total earning assets
    
    
    1,794,538
    
    
    
    70,076
    
    
    
    5.22
    
    
    
    1,956,218
    
    
    
    76,068
    
    
    
    5.20Non-earning assets:Cash and due from banks
    
    
    27,489
    
    
    
    
    
    
    
    
    
    
    
    22,648Premises and equipment
    
    
    40,143
    
    
    
    
    
    
    
    
    
    
    
    43,842Other assets
    
    
    105,656
    
    
    
    
    
    
    
    
    
    
    
    96,339Allowance for credit losses
    
    
    (35,610
    )
    
    
    
    
    
    
    
    
    
    
    (40,761
    )Total assets
    
    $
    1,932,216
    
    
    
    70,076
    
    
    
    
    
    
    $
    2,078,286
    
    
    
    76,068Interest-bearing liabilities:Savings deposits
    
    $
    40,487
    
    
    
    30
    
    
    
    0.10
    %
    
    $
    40,876
    
    
    
    30
    
    
    
    0.10
    %NOW deposits
    
    
    349,769
    
    
    
    2,321
    
    
    
    0.89
    
    
    
    180,367
    
    
    
    405
    
    
    
    0.30Money market deposits
    
    
    348,155
    
    
    
    2,247
    
    
    
    0.86
    
    
    
    395,354
    
    
    
    3,461
    
    
    
    1.17Time deposits
    
    
    634,059
    
    
    
    7,243
    
    
    
    1.53
    
    
    
    888,512
    
    
    
    22,330
    
    
    
    3.36Other borrowings
    
    
    78,419
    
    
    
    1,822
    
    
    
    3.11
    
    
    
    73,411
    
    
    
    1,949
    
    
    
    3.55Borrowings from Federal
Home Loan Bank
    
    
    133,282
    
    
    
    2,639
    
    
    
    2.65
    
    
    
    149,399
    
    
    
    3,515
    
    
    
    3.15Total interest-bearing liabilities
    
    
    1,584,171
    
    
    
    16,302
    
    
    
    1.37
    
    
    
    1,727,919
    
    
    
    31,690
    
    
    
    2.45Other liabilities and shareholders
equity:Demand deposits
    
    
    163,973
    
    
    
    
    
    
    
    
    
    
    
    157,196Other liabilities
    
    
    17,317
    
    
    
    
    
    
    
    
    
    
    
    21,084Shareholders equity
    
    
    166,755
    
    
    
    
    
    
    
    
    
    
    
    172,087Total liabilities and shareholders
equity
    
    $
    1,932,216
    
    
    
    16,302
    
    
    
    
    
    
    $
    2,078,286
    
    
    
    31,690Net interest income and net
interest margin3
    
    
    
    
    
    $
    53,774
    
    
    
    4.01
    %
    
    
    
    
    
    $
    44,378
    
    
    
    3.03
    %Interest rate spread4
    
    
    
    
    
    
    
    
    
    
    3.85
    %
    
    
    
    
    
    
    
    
    
    
    2.75
    %
 
 1
    
    Income related to securities exempt from federal income taxes is stated on a fully
taxable-equivalent basis, assuming a federal income tax rate of 35%, and is then reduced by
the non-deductible portion of interest expense. The adjustments made to convert to a fully
taxable equivalent basis were $1,435 for 2010 and $1,501 for
2009.2
    
    The average loans receivable balances include non-accruing loans. Amortization of
loan fees, net of deferred costs, of $765 and $1,124 for the nine months ended September 30,
2010 and 2009, respectively, are included in interest
income.3
    
    Net interest margin is computed by dividing net interest income by average earning
assets.4
    
    Earning assets yield minus interest-bearing liability rate. 20




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##### Table of Contents



Noninterest Income and Expense
    Other Operating Income and Expenses (in thousands)
 Nine Months EndedSeptember 30,
    
    
    Percentage2010
    
    
    2009
    
    
    VarianceOther operating income:Bankcard income
    
    $
    515
    
    
    $
    1,834
    
    
    
    (71.9
    )%Investment services commissions
    
    
    1,133
    
    
    
    866
    
    
    
    30.9Insurance commissions
    
    
    47
    
    
    
    49
    
    
    
    (5.0
    )Trust income
    
    
    408
    
    
    
    415
    
    
    
    (1.6
    )Gain on sale of merchant services portfolio
    
    
    
    
    
    
    1,177
    
    
    NMIncome on bank-owned life insurance
    
    
    647
    
    
    
    357
    
    
    
    81.3Other income (loss)
    
    
    (77
    )
    
    
    351
    
    
    NM$
    2,673
    
    
    
    5,049
    
    
    
    (47.1
    )Other operating expenses:Advertising
    
    $
    1,192
    
    
    $
    974
    
    
    
    22.4
    %Automated services
    
    
    3,313
    
    
    
    4,377
    
    
    
    (24.3
    )Bankcard expense
    
    
    412
    
    
    
    1,777
    
    
    
    (76.8
    )Legal and professional fees
    
    
    2,324
    
    
    
    2,457
    
    
    
    (5.4
    )Postage
    
    
    743
    
    
    
    663
    
    
    
    12.0Stationery, printing and supplies
    
    
    496
    
    
    
    434
    
    
    
    14.3Other expense
    
    
    4,510
    
    
    
    5,170
    
    
    
    (12.8
    )$
    12,990
    
    
    $
    15,852
    
    
    
    (18.1
    )
 Asset Quality and Allowance for Credit losses
  21




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##### Table of Contents



Nine Months Ended
    
    
    Year Ended
    
    
    Nine Months EndedAsset Quality Analysis
    
    September 30
    
    
    December 31
    
    
    September 30(Dollars in thousands)
    
    2010
    
    
    2009
    
    
    2009Allowance for credit losses:Beginning balance
    
    $
    35,843
    
    
    $
    35,805
    
    
    $
    35,805Provision for credit losses
    
    
    16,616
    
    
    
    35,749
    
    
    
    30,179Net charge-offs
    
    
    (16,905
    )
    
    
    (35,711
    )
    
    
    (27,082
    )Ending balance
    
    $
    35,554
    
    
    $
    35,843
    
    
    $
    38,902Nonperforming Assets:Commercial nonaccrual loans, not restructured
    
    $
    28,699
    
    
    $
    46,788
    
    
    $
    44,889Commercial nonaccrual loans, restructured
    
    
    8,338
    
    
    
    1,777
    
    
    
    1,747Non-commercial nonaccrual loans
    
    
    7,828
    
    
    
    4,772
    
    
    
    6,443Total nonaccrual loans
    
    
    44,865
    
    
    
    53,337
    
    
    
    53,079Troubled debt restructured, accruing
    
    
    5,865
    
    
    
    1,442
    
    
    
    1,260Loans 90 days or more past due and
still accruing
    
    
    1,290
    
    
    
    3,450
    
    
    
    3,354Total non-performing loans
    
    
    52,020
    
    
    
    58,229
    
    
    
    57,693Real estate acquired in settlement of loans
    
    
    29,571
    
    
    
    27,337
    
    
    
    19,031Total nonperforming assets
    
    $
    81,591
    
    
    $
    85,566
    
    
    $
    76,724Asset Quality Ratios:Nonperforming loans to loans outstanding
at end of period
    
    
    3.79
    %
    
    
    3.98
    %
    
    
    3.86
    %Nonperforming assets to total assets
at end of period
    
    
    4.38
    
    
    
    4.40
    
    
    
    3.82Allowance for credit losses as a percentage
of loans outstanding at end of period
    
    
    2.59
    
    
    
    2.45
    
    
    
    2.60Allowance for credit losses to nonperforming loans
    
    
    68.35
    
    
    
    61.56
    
    
    
    67.43Net charge-offs as a percentage of
average loans outstanding during the period
    
    
    1.59
    *
    
    
    2.32
    
    
    
    2.33
    *
 
 *
    
    Denotes annualized Income Taxes
  Risk Management
  23




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Interest Rate Risk Management
    Liquidity Management
   24




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##### Table of Contents



Capital Resources and Shareholders Equity
    25




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##### Table of Contents



Regulatory CapitalWell
    
    AdequatelyCapitalized
    
    Capitalized
    
    Company
    
    BankTotal Capital
    
    
    10.0
    %
    
    
    8.0
    %
    
    
    13.11
    %
    
    
    12.63
    %Tier 1 Capital
    
    
    6.0
    
    
    
    4.0
    
    
    
    11.82
    
    
    
    11.34Leverage Capital
    
    
    5.0
    
    
    
    4.0
    
    
    
    9.39
    
    
    
    9.01
  
 Item 3.
    Quantitative and Qualitative Disclosures about Market Risk
    
 Item 4.
    Controls and Procedures
 Evaluation of disclosure controls and procedures
  Changes in internal control over financial reporting
  26




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##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings
  
 Item 1A.
    
    Risk Factors
 There have been no material changes to the Companys Risk Factors as previously disclosed in
the Companys Annual Report on Form 10-K for the fiscal year
ended December 31, 2009.
 
 Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
 There were no sales of equity securities during the first nine months of 2010 which were not
registered under the Securities Act of 1933, as amended. The Company did not repurchase any
of its equity securities during the first nine months of 2010.
 
 Item 3.
    
    Defaults Upon Senior Securities
  
 Item 4.
    
    Removed and Reserved
 
 Item 5.
    
    Other Information
  27




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##### Table of Contents



Item 6.
    Exhibits
 ExhibitNo.
    
    Description3.1
    
    Articles of Incorporation, and amendments thereto, incorporated by reference
to Exhibit 4.1 of the Registration Statement on Form S-8, filed with the SEC
on May 16, 2001 (SEC File No. 333-61046).3.2
    
    Articles of Merger of FNB with and into LSB, including amendments to the
Articles of Incorporation, as amended, incorporated by reference to Exhibit
3.4 of the Quarterly Report on Form 10-Q for the quarter ended September 30,
2007, filed with the SEC on November 9, 2007 (SEC File No. 000-11448).3.3
    
    Amended and Restated Bylaws adopted by the Board of Directors on August 17,
2004 and amended on July 23, 2008 (with identified Bylaw approved by the
shareholders) incorporated by reference to Exhibit 3.3 of the Quarterly Report
on Form 10-Q for the quarter ended March 31, 2009, filed with the SEC on May
8, 2009 (SEC File No. 000-11448).4.1
    
    Specimen certificate of common stock, $5.00 par value, incorporated by
reference to Exhibit 4.1 of the Quarterly Report on Form 10-Q for the quarter
ended September 30, 2007, filed with the SEC on November 9, 2007 (SEC File No.
000-11448).4.2
    
    Amended and Restated Trust Agreement, regarding Trust Preferred Securities,
dated August 23, 2005, incorporated herein by reference to Exhibit 4.02 of the
Quarterly Report on Form 10-Q for the quarter ended September 30, 2005, filed
with the SEC (SEC File No. 000-13086).4.3
    
    Guarantee Agreement, regarding Trust Preferred Securities, dated August 23,
2005, incorporated herein by reference to Exhibit 4.03 of the Quarterly Report
on Form 10-Q for the quarter ended September 30, 2005, filed with the SEC (SEC
File No. 000-13086).4.4
    
    Indenture, regarding Trust Preferred Securities, dated August 23, 2005,
incorporated herein by reference to Exhibit 4.04 of the Quarterly Report on
Form 10-Q for the quarter ended September 30, 2005, filed with the SEC (SEC
File No. 000-13086).4.5
    
    Articles of Amendment, filed with the North Carolina Department of the
Secretary of State on December 12, 2008, incorporated herein by reference to
Exhibit 4.1 of the Current Report on Form 8-K filed with the SEC on December
12, 2008 (SEC File No. 000-11448).4.6
    
    Form of Certificate for the Fixed Rate Cumulative Perpetual Preferred Stock,
Series A, incorporated herein by reference to Exhibit 4.2 of the Current
Report on Form 8-K filed with the SEC on December 12, 2008 (SEC File No.
000-11448).4.7
    
    Warrant for Purchase of Shares of Common Stock issued by Bancorp to the United
States Department of the Treasury on December 12, 2008, incorporated herein by
reference to Exhibit 4.3 of the Current Report on Form 8-K filed with the SEC
on December 12, 2008 (SEC File No. 000-11448).10.1
    
    Benefit Equivalency Plan of FNB Southeast, effective January 1, 1994
incorporated herein by reference to Exhibit 10 of the Quarterly Report on Form
10-QSB for the fiscal quarter ended June 30, 1995, filed with the SEC (SEC
File No. 000-13086).10.2
    
    1994 Director Stock Option Plan, incorporated herein by reference to Exhibit 4
of the Registration Statement on Form S-8 filed with the SEC on July 15, 1994
(SEC File No. 33-81664).
 28




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##### Table of Contents



ExhibitNo.
    
    Description10.3
    
    1996 Omnibus Stock Incentive Plan, incorporated herein by reference to Exhibit
10.2 of the Annual Report on Form 10-K for the year ended December 31, 1995
filed with the SEC on March 28, 1996 (SEC File
No. 000-11448).10.4
    
    Omnibus Equity Compensation Plan, incorporated herein by reference to Exhibit
10(B) of the Annual Report on Form 10-KSB40 for the fiscal year ended December
31, 1996, filed with the SEC on March 31, 1997 (SEC File No. 000-13086).10.5
    
    Amendment to Benefit Equivalency Plan of FNB Southeast, effective January 1,
1998., incorporated herein by reference to Exhibit 10.16 of the Annual Report
on Form 10-K for the fiscal year ended December 31, 1998, filed with the SEC
on March 25, 1999 (SEC File No. 000-13086)10.6
    
    Amendment Number 1 to 1996 Omnibus Stock Incentive Plan, incorporated herein
by reference to Exhibit 4.5 of the Registration Statement on Form S-8, filed
with the SEC on May 16, 2001 (SEC File No. 333-61046).10.7
    
    Long Term Stock Incentive Plan for certain senior management employees of FNB
Southeast incorporated herein by reference to Exhibit 10.10 of the Annual
Report on Form 10-K for the fiscal year ended December 31, 2002, filed with
the SEC on March 27, 2003 (SEC File No. 000-13086).10.8
    
    Form of Employment Continuity Agreement effective as of January 1, 2004
between LSB and Robert E. Lineback, Jr. and Philip G. Gibson with a Schedule
setting forth the material details in which such documents differ from the
document a copy of which is filed, incorporated herein by reference to Exhibit
10.10 of the Annual Report on Form 10-K for the year ended December 31, 2003
filed with the SEC on March 15, 2004 (SEC File No. 000-11448).10.9
    
    Form of Stock Option Award Agreement for a Director adopted under LSB
Comprehensive Equity Compensation Plan for Directors and Employees,
incorporated herein by reference to Exhibit 10.1 of the Current Report on Form
8-K filed with the SEC on December 23, 2004 (SEC File No. 000-11448).10.10
    
    Form of Incentive Stock Option Award Agreement for an Employee adopted under
LSB Comprehensive Equity Compensation Plan for Directors and Employees,
incorporated herein by reference to Exhibit 10.2 of the Current Report on Form
8-K filed with the SEC on December 23, 2004 (SEC File No. 000-11448).10.11
    
    Form of Amendment to the applicable Grant Agreements under the 1996 Omnibus
Stock Incentive Plan, incorporated herein by reference to Exhibit 10.2 of the
Current Report on Form 8-K filed with the SEC on April 15, 2005 (SEC File No.
000-11448).10.12
    
    Form of Amendment to the Incentive Stock Option Award Agreement for an
Employee adopted under LSB Comprehensive Equity Compensation Plan for
Directors and Employees, incorporated herein by reference to Exhibit 10.3 of
the Current Report on Form 8-K filed with the SEC on April 15, 2005 (SEC File
No. 000-11448).10.13
    
    Restated Form of Director Fee Deferral Agreement adopted under LSB
Comprehensive Equity Compensation Plan for Directors and Employees,
incorporated herein by reference to Exhibit 99.1 of the Current Report on Form
8-K filed with the SEC on December 23, 2005 (SEC File No. 000-11448).10.14
    
    Form of Stock Appreciation Rights Award Agreement adopted under LSB
Comprehensive Equity Compensation Plan for Directors and Employees,
incorporated herein by reference to Exhibit 99.2 of the Current Report on Form
8-K filed with the SEC on December 23, 2005 (SEC File No. 000-11448).
 29




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##### Table of Contents



ExhibitNo.
    
    Description10.15
    
    FNB Amended and Restated Directors Retirement Policy, incorporated herein by
reference to Exhibit 99.1 of the Current Report on Form 8-K, filed with the
SEC on August 3, 2007 (SEC File No. 000-11448).10.16
    
    Amendment to the FNB Directors and Senior Management Deferred Compensation
Plan Trust Agreement among Regions Bank d/b/a/ Regions Morgan Keegan Trust,
FNB Southeast and FNB, dated July 31, 2007, incorporated herein by reference
to Exhibit 99.2 of the Current Report on Form 8-K, filed with the SEC on
August 3, 2007 (SEC File No. 000-11448).10.17
    
    Employment and Change of Control Agreement with William W. Budd, Jr.
incorporated herein by reference to Exhibit 99.1 of the Current Report on Form
8-K, filed with the SEC on March 11, 2010 (SEC File No. 000-11448).10.18
    
    Employment and Change of Control Agreement with Jerry W. Beasley, incorporated
herein by reference to Exhibit 99.3 of the Current Report on Form 8-K, filed
with the SEC on March 14, 2008 (SEC File No. 000-11448).10.19
    
    Employment and Change of Control Agreement with Robin S. Hager, incorporated
herein by reference to Exhibit 99.1 of the Current Report on Form 8-K, filed
with the SEC on August 3, 2010 (SEC File No. 000-11448).10.20
    
    Employment and Change of Control Agreement with Paul McCombie, incorporated
herein by reference to Exhibit 99.5 of the Current Report on Form 8-K, filed
with the SEC on March 14, 2008 (SEC File No. 000-11448).10.21
    
    Directors and Senior Management Deferred Compensation Plan Trust Agreement
between FNB Southeast and Morgan Trust Company, incorporated herein by
reference to Exhibit 99.7 of the Current Report on Form 8-K, filed with the
SEC on March 14, 2008 (SEC File No. 000-11448).10.22
    
    Bancorp Non-Qualified Deferred Compensation Plan for Directors and Senior
Management, incorporated herein by reference to Exhibit 99.9 of the Current
Report on Form 8-K, filed with the SEC on March 14, 2008 (SEC File No.
000-11448).10.23
    
    First Amendment to the Bancorp Non-Qualified Deferred Compensation Plan for
Directors and Senior Management, incorporated herein by reference to Exhibit
99.10 of the Current Report on Form 8-K, filed with the SEC on March 14, 2008
(SEC File No. 000-11448).10.24
    
    Bancorp Amended and Restated Long Term Stock Incentive Plan, formerly the FNB
Long Term Stock Incentive Plan (the 2006 Omnibus Plan), incorporated herein
by reference to Exhibit 10.27 of the Quarterly Report on Form 10-Q filed with
the SEC on May 9, 2008 (SEC File No. 000-11448).10.25
    
    Amended and Restated Comprehensive Equity Compensation Plan for Directors and
Employees, incorporated herein by reference to Exhibit 10.44 of the Quarterly
Report on Form 10-Q, filed with the SEC on August 11, 2008 (SEC File No.
000-11448).10.26
    
    Form of Restricted Stock Award Agreement adopted under the Amended and
Restated Comprehensive Equity Compensation Plan for Directors and Employees,
incorporated herein by reference to Exhibit 10.45 of the Quarterly Report on
Form 10-Q, filed with the SEC on August 11, 2008 (SEC File No. 000-11448).10.27
    
    Employment and Change of Control Agreement with David P. Barksdale,
incorporated herein by reference to Exhibit 99.1 of the Current Report on Form
8-K, filed with the SEC on October 17, 2008 (SEC File No. 000-11448).
 30




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##### Table of Contents



ExhibitNo.
    
    Description10.28
    
    Letter Agreement, dated December 12, 2008, between Bancorp and the United
States Department of the Treasury, with respect to the issuance and sale of
the Fixed Rate Cumulative Perpetual Preferred Stock, Series A and the Warrant,
incorporated herein by reference to Exhibit 10.1 of the Current Report on Form
8-K filed with the SEC on December 12, 2008 (SEC File No. 000-11448).10.29
    
    Form of Employment Agreement Amendment, dated December 12, 2008 among Bancorp,
the Bank and the senior executive officers of Bancorp, incorporated herein by
reference to Exhibit 10.2 of the Current Report on Form 8-K filed with the SEC
on December 12, 2008 (SEC File No. 000-11448).10.30
    
    Bancorp Management Incentive Plan, dated February 18, 2008, incorporated
herein by reference to Exhibit 99.1 of the Current Report on Form 8-K, filed
with the SEC on March 6, 2009 (SEC File No. 000-11448).10.31
    
    Employment and Change of Control Agreement with Ramsey K. Hamadi, incorporated
herein by reference to Exhibit 99.1 of the Current Report on Form 8-K, filed
with the SEC on March 30, 2009 (SEC File No. 000-11448).10.32
    
    Promissory Note by Ramsey K. Hamadi in favor of the Bank incorporated herein
by reference to Exhibit 99.1 of the Current Report on Form 8-K, filed with the
SEC on April 21, 2009 (SEC File No. 000-11448).10.33
    
    Excessive and Luxury Expenditure Policy of Bancorp and the Bank, incorporated
herein by reference to Exhibit 99.1 of the Current Report on Form 8-K filed
with the SEC on September 9, 2009 (SEC File No. 000-11448).10.34
    
    Employment and Change of Control Agreement among Bancorp, the Bank and
Pressley A. Ridgill, executed September 9, 2009, and effective January 1,
2010, incorporated herein by reference to Exhibit 99.1 of the Current Report
on Form 8-K filed with the SEC on September 11, 2009 (SEC File No. 000-11448).10.35
    
    Form of Amendment to Employment and Change of Control Agreement, dated
September 16, 2009, among Bancorp, the Bank and the senior executive officers
of Bancorp, incorporated herein by reference to Exhibit 99.1 of the Current
Report on Form 8-K filed with the SEC on September 16, 2009 (SEC File No.
000-11448).31.01
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.02
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.01
    
    Certifications Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 31




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##### Table of Contents



SIGNATURES
  Date:  November 9, 2010
    NEWBRIDGE BANCORP
(Registrant)By:
    /s/ Ramsey K. HamadiName:
    Ramsey K. HamadiTitle:
    Executive Vice President and Chief Financial Officer
(Authorized Officer) 32




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EXHIBIT INDEX
 ExhibitNo.
    
    Description31.01
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.02
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32
    
    Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 33