Exhibit 4.1


 


UST No. 1171


 


WARRANT TO PURCHASE PREFERRED STOCK


 


THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS
OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH
ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER SUCH ACT OR SUCH LAWS. 
THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND
OTHER PROVISIONS OF A SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE
SECURITIES AND THE INVESTOR REFERRED TO THEREIN, A COPY OF WHICH IS ON FILE
WITH THE ISSUER. THE SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE
SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENT.  ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE
WITH SAID AGREEMENT WILL BE VOID.


 


WARRANT


to purchase


98.00098


Shares of Preferred Stock of


Atlantic
Bancshares, Inc.


 


Issue
Date:  December 29, 2009


 


1.                                       Definitions. Unless
the context otherwise requires, when used herein the following terms shall have
the meanings indicated.


 


“Board of
Directors” means the board of directors of the Company, including
any duly authorized committee thereof.


 


“business
day” means any day except Saturday, Sunday and any day on which
banking institutions in the State of New York generally are authorized or
required by law or other governmental actions to close.


 


“Charter”
means, with respect to any Person, its certificate or articles of
incorporation, articles of association, or similar organizational document.


 


“Company”
means the Person whose name, corporate or other organizational form and
jurisdiction of organization is set forth in Item 1 of Schedule A hereto.


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended, or any
successor statute, and the rules and regulations promulgated thereunder.


 


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“Exercise
Price” means the amount set forth in Item 2 of Schedule A hereto.


 


“Expiration Time” has the meaning set forth
in Section 3.


 


“Issue Date” means the date set forth in
Item 3 of Schedule A hereto.


 


“Liquidation
Amount” means the amount set forth in Item 4 of Schedule A hereto.


 


“Original
Warrantholder” means the United States Department of the
Treasury.  Any actions specified to be
taken by the Original Warrantholder hereunder may only be taken by such Person
and not by any other Warrantholder.


 


“Person”
has the meaning given to it in Section 3(a)(9) of the Exchange Act
and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.


 


“Preferred
Stock” means the series of perpetual preferred stock set forth in Item 5 of
Schedule A hereto.


 


“Purchase
Agreement” means the Securities Purchase Agreement — Standard Terms
incorporated into the Letter Agreement, dated as of the date set forth in Item
6 of Schedule A hereto, as amended from time to time, between the Company and
the United States Department of the Treasury (the “Letter Agreement”), including all annexes and schedules
thereto.


 


“Regulatory
Approvals” with respect to the Warrantholder, means, to the extent
applicable and required to permit the Warrantholder to exercise this Warrant
for shares of Preferred Stock and to own such Preferred Stock without the
Warrantholder being in violation of applicable law, rule or regulation,
the receipt of any necessary approvals and authorizations of, filings and
registrations with, notifications to, or expiration or termination of any
applicable waiting period under, the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, and the rules and regulations thereunder.


 


“SEC”
means the U.S. Securities and Exchange Commission.


 


“Securities
Act” means the Securities Act of 1933, as amended, or any successor
statute, and the rules and regulations promulgated thereunder.


 


“Shares”
has the meaning set forth in Section 2.


 


“Warrantholder” has the meaning set forth
in Section 2.


 


“Warrant” means this Warrant, issued
pursuant to the Purchase Agreement.


 


2.                                       Number of Shares; Exercise Price. This certifies that, for value received, the United States
Department of the Treasury or its permitted assigns (the “Warrantholder”) is entitled, upon the
terms and subject to the conditions hereinafter set forth, to acquire from the
Company, in whole or in part, after the receipt of all applicable Regulatory
Approvals, if any, up to an aggregate of the number of fully paid and
nonassessable shares of Preferred Stock set forth in Item 7 of Schedule A
hereto (the “Shares”), at a
purchase price per share of Preferred Stock equal to the Exercise Price.


 


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3.                                       Exercise of Warrant; Term.
Subject to Section 2, to the extent permitted by applicable laws and
regulations, the right to purchase the Shares represented by this Warrant is
exercisable, in whole or in part by the Warrantholder, at any time or from time
to time after the execution and delivery of this Warrant by the Company on the
date hereof, but in no event later than 5:00 p.m., New York City time on
the tenth anniversary of the Issue Date (the “Expiration
Time”), by (A) the surrender of this Warrant and Notice of
Exercise annexed hereto, duly completed and executed on behalf of the
Warrantholder, at the principal executive office of the Company located at the
address set forth in Item 8 of Schedule A hereto (or such other office or
agency of the Company in the United States as it may designate by notice in
writing to the Warrantholder at the address of the Warrantholder appearing on
the books of the Company), and (B) payment of the Exercise Price for the
Shares thereby purchased, by having the Company withhold, from the shares of
Preferred Stock that would otherwise be delivered to the Warrantholder upon
such exercise, shares of Preferred Stock issuable upon exercise of the Warrant
with an aggregate Liquidation Amount equal in value to the aggregate Exercise
Price as to which this Warrant is so exercised.


 


If the Warrantholder does not exercise this
Warrant in its entirety, the Warrantholder will be entitled to receive from the
Company within a reasonable time, and in any event not exceeding three business
days, a new warrant in substantially identical form for the purchase of that
number of Shares equal to the difference between the number of Shares subject
to this Warrant and the number of Shares as to which this Warrant is so
exercised.  Notwithstanding anything in
this Warrant to the contrary, the Warrantholder hereby acknowledges and agrees
that its exercise of this Warrant for Shares is subject to the condition that
the Warrantholder will have first received any applicable Regulatory Approvals.


 


4.                                       Issuance of Shares; Authorization. Certificates for Shares issued upon exercise of this
Warrant will be issued in such name or names as the Warrantholder may designate
and will be delivered to such named Person or Persons within a reasonable time,
not to exceed three business days after the date on which this Warrant has been
duly exercised in accordance with the terms of this Warrant.  The Company hereby represents and warrants
that any Shares issued upon the exercise of this Warrant in accordance with the
provisions of Section 3 will be duly and validly authorized and issued,
fully paid and nonassessable and free from all taxes, liens and charges (other
than liens or charges created by the Warrantholder, income and franchise taxes
incurred in connection with the exercise of the Warrant or taxes in respect of
any transfer occurring contemporaneously therewith).  The Company agrees that the Shares so issued
will be deemed to have been issued to the Warrantholder as of the close of
business on the date on which this Warrant and payment of the Exercise Price
are delivered to the Company in accordance with the terms of this Warrant, notwithstanding
that the stock transfer books of the Company may then be closed or certificates
representing such Shares may not be actually delivered on such date. The
Company will at all times reserve and keep available, out of its authorized but
unissued preferred stock, solely for the purpose of providing for the exercise
of this Warrant, the aggregate number of shares of Preferred Stock then
issuable upon exercise of this Warrant at any time.  The Company will use reasonable best efforts
to ensure that the Shares may be issued without violation of any applicable law
or regulation or of any requirement of any securities exchange on which the
Shares are listed or traded.


 


5.                                       No Rights as Stockholders; Transfer Books. This Warrant does not entitle the Warrantholder to any
voting rights or other rights as a stockholder of the Company prior to the date
of exercise hereof. The Company will at no time close its transfer books
against transfer of this


 


3

















 


Warrant in any manner which interferes with the timely
exercise of this Warrant.


 


6.                                       Charges, Taxes and Expenses.
Issuance of certificates for Shares to the Warrantholder upon the exercise of
this Warrant shall be made without charge to the Warrantholder for any issue or
transfer tax or other incidental expense in respect of the issuance of such
certificates, all of which taxes and expenses shall be paid by the Company.


 


7.                                       Transfer/Assignment.


 


(A) Subject to compliance with clause (B) of
this Section 7, this Warrant and all rights hereunder are transferable, in
whole or in part, upon the books of the Company by the registered holder hereof
in person or by duly authorized attorney, and a new warrant shall be made and
delivered by the Company, of the same tenor and date as this Warrant but
registered in the name of one or more transferees, upon surrender of this
Warrant, duly endorsed, to the office or agency of the Company described in Section 3.  All expenses (other than stock transfer
taxes) and other charges payable in connection with the preparation, execution
and delivery of the new warrants pursuant to this Section 7 shall be paid
by the Company.


 


(B) The transfer of the Warrant and the Shares
issued upon exercise of the Warrant are subject to the restrictions set forth
in Section 4.4 of the Purchase Agreement. 
If and for so long as required by the Purchase Agreement, this Warrant
shall contain the legends as set forth in Section 4.2(a) of the
Purchase Agreement.


 


8.                                       Exchange and Registry of Warrant. This Warrant is exchangeable, upon the surrender hereof by
the Warrantholder to the Company, for a new warrant or warrants of like tenor
and representing the right to purchase the same aggregate number of
Shares.  The Company shall maintain a
registry showing the name and address of the Warrantholder as the registered
holder of this Warrant. This Warrant may be surrendered for exchange or
exercise in accordance with its terms, at the office of the Company, and the
Company shall be entitled to rely in all respects, prior to written notice to
the contrary, upon such registry.


 


9.                                       Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and in the case of any such loss, theft or destruction, upon receipt
of a bond, indemnity or security reasonably satisfactory to the Company, or, in
the case of any such mutilation, upon surrender and cancellation of this
Warrant, the Company shall make and deliver, in lieu of such lost, stolen,
destroyed or mutilated Warrant, a new Warrant of like tenor and representing
the right to purchase the same aggregate number of Shares as provided for in
such lost, stolen, destroyed or mutilated Warrant.


 


10.                                 Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or
the expiration of any right required or granted herein shall not be a business
day, then such action may be taken or such right may be exercised on the next
succeeding day that is a business day.


 


11.                                 Rule 144 Information.
The Company covenants that it will use its reasonable best efforts to timely
file all reports and other documents required to be filed by it under the
Securities 


 


4

















 


Act and the Exchange Act and the rules and
regulations promulgated by the SEC thereunder (or, if the Company is not
required to file such reports, it will, upon the request of any Warrantholder,
make publicly available such information as necessary to permit sales pursuant
to Rule 144 under the Securities Act), and it will use reasonable best
efforts to take such further action as any Warrantholder may reasonably
request, in each case to the extent required from time to time to enable such
holder to, if permitted by the terms of this Warrant and the Purchase
Agreement, sell this Warrant without registration under the Securities Act
within the limitation of the exemptions provided by (A) Rule 144
under the Securities Act, as such rule may be amended from time to time,
or (B) any successor rule or regulation hereafter adopted by the SEC.
Upon the written request of any Warrantholder, the Company will deliver to such
Warrantholder a written statement that it has complied with such requirements.


 


12.                                 Adjustments and Other Rights.
For so long as the Original Warrantholder holds this Warrant or any portion
thereof, if any event occurs that, in the good faith judgment of the Board of
Directors of the Company, would require adjustment of the Exercise Price or
number of Shares into which this Warrant is exercisable in order to fairly and
adequately protect the purchase rights of the Warrants in accordance with the
essential intent and principles of the Purchase Agreement and this Warrant,
then the Board of Directors shall make such adjustments in the application of
such provisions, in accordance with such essential intent and principles, as
shall be reasonably necessary, in the good faith opinion of the Board of
Directors, to protect such purchase rights as aforesaid.


 


Whenever the Exercise Price or the number of Shares
into which this Warrant is exercisable shall be adjusted as provided in this Section 12,
the Company shall forthwith file at the principal office of the Company a
statement showing in reasonable detail the facts requiring such adjustment and
the Exercise Price that shall be in effect and the number of Shares into which
this Warrant shall be exercisable after such adjustment, and the Company shall
also cause a copy of such statement to be sent by mail, first class postage
prepaid, to each Warrantholder at the address appearing in the Company’s
records.


 


13.                                 No Impairment. The
Company will not, by amendment of its Charter or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms to be observed or performed hereunder by the
Company, but will at all times in good faith assist in the carrying out of all
the provisions of this Warrant and in taking of all such action as may be
necessary or appropriate in order to protect the rights of the Warrantholder.


 


14.                                 Governing Law. This
Warrant will be governed by and construed in accordance with the federal law of
the United States if and to the extent such law is applicable, and otherwise in
accordance with the laws of the State of New York applicable to contracts made
and to be performed entirely within such State. Each of the Company and the
Warrantholder agrees (a) to submit to the exclusive jurisdiction and venue
of the United States District Court for the District of Columbia for any civil
action, suit or proceeding arising out of or relating to this Warrant or the
transactions contemplated hereby, and (b) that notice may be served upon
the Company at the address in Section 17 below and upon the Warrantholder
at the address for the Warrantholder set forth in the registry maintained by
the Company pursuant to Section 8 hereof. 
To the extent permitted by applicable law, each of the Company and the
Warrantholder hereby unconditionally waives trial by jury in any civil legal
action or proceeding relating to the Warrant or the transactions contemplated
hereby or 


 


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thereby.


 


15.                                 Binding Effect. This
Warrant shall be binding upon any successors or assigns of the Company.


 


16.                                 Amendments. This
Warrant may be amended and the observance of any term of this Warrant may be
waived only with the written consent of the Company and the Warrantholder.


 


17.                                 Notices. Any
notice, request, instruction or other document to be given hereunder by any
party to the other will be in writing and will be deemed to have been duly
given (a) on the date of delivery if delivered personally, or by
facsimile, upon confirmation of receipt, or (b) on the second business day
following the date of dispatch if delivered by a recognized next day courier
service. All notices hereunder shall be delivered as set forth in Item 9 of
Schedule A hereto, or pursuant to such other instructions as may be designated
in writing by the party to receive such notice.


 


18.                                 Entire Agreement. This
Warrant, the forms attached hereto and Schedule A hereto (the terms of which
are incorporated by reference herein), and the Letter Agreement (including all
documents incorporated therein), contain the entire agreement between the
parties with respect to the subject matter hereof and supersede all prior and
contemporaneous arrangements or undertakings with respect thereto.


 


[Remainder
of page intentionally left blank]


 


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[Notice
of Exercise]


	
   

  	
  Date:

  	
  December 29,
  2009

  	
   

  



 


TO:                            Atlantic Bancshares, Inc.


 


RE:                              Election
to Purchase Preferred Stock


 


The undersigned, pursuant to
the provisions set forth in the attached Warrant, hereby agrees to subscribe
for and purchase such number of shares of Preferred Stock covered by the
Warrant such that after giving effect to an exercise pursuant to Section 3(B) of
the Warrant, the undersigned will receive the net number of shares of Preferred
Stock set forth below.  The undersigned,
in accordance with Section 3 of the Warrant, hereby agrees to pay the
aggregate Exercise Price for such shares of Preferred Stock in the manner set
forth in Section 3(B) of the Warrant.


 


	
  Number of
  Shares of Preferred Stock:(1):

  	
  98

  	
   

  



 


The
undersigned agrees that it is exercising the attached Warrant in full and that,
upon receipt by the undersigned of the number of shares of Preferred Stock set
forth above, such Warrant shall be deemed to be cancelled and surrendered to
the Company.


 


 


	
   

  	
  Holder:

  	
  United
  States Department of the Treasury

  
	
   

  	
  By:

  	
  /s/
  David Miller

  
	
   

  	
  Name:

  	
  David
  Miller

  
	
   

  	
  Title:

  	
  Acting
  Chief Investment Officer

  



 






(1)                                  Number of
shares to be received by the undersigned upon exercise of the attached Warrant
pursuant to Section 3(B) thereof.


 


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IN WITNESS WHEREOF, the Company has caused
this Warrant to be duly executed by a duly authorized officer.


 


	
  Dated:  December 29,
  2009

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ATLANTIC
  BANCSHARES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Robert P. Trask

  
	
   

  	
  Name:

  	
  Robert
  P. Trask

  
	
   

  	
  Title:

  	
  President & Chief Executive Officer

  
				



 


 


	
   

  	
  Attest:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michelle M. Pennell

  
	
   

  	
  Name:

  	
  Michelle
  M. Pennell

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


[Signature Page to
Warrant]


 


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SCHEDULE A


 


 


	
  Item
  1

  	
   

  
	
   

  	
   

  
	
  Name:  Atlantic Bancshares, Inc.

  	
   

  
	
  Corporate
  or other organizational form: 
  Corporation

  	
   

  
	
  Jurisdiction
  of organization:  South Carolina

  	
   

  
	
   

  	
   

  
	
  Item
  2

  	
   

  
	
   

  	
   

  
	
  Exercise
  Price:  $.01 per share

  	
   

  
	
   

  	
   

  
	
  Item
  3

  	
   

  
	
   

  	
   

  
	
  Issue
  Date:  December 29, 2009

  	
   

  
	
   

  	
   

  
	
  Item
  4

  	
   

  
	
   

  	
   

  
	
  Liquidation Amount:  $1,000 per share

  
	
   

  	
   

  
	
  Item
  5

  	
   

  
	
   

  	
   

  
	
  Series of Perpetual Preferred Stock:  Fixed Rate Cumulative Perpetual Preferred
  Stock, Series B

  
	
   

  	
   

  
	
  Item
  6

  	
   

  
	
   

  	
   

  
	
  Date of Letter Agreement between the Company and
  the United States Department of the Treasury: December 29, 2009

  
	
   

  	
   

  
	
  Item 7

  
	
   

  
	
  Number of shares of
  Preferred Stock:  98.00098

  
	
   

  	
   

  
	
  Item
  8

  	
   

  
	
   

  	
   

  
	
  Company’s
  address:

  	
  One
  Sheridan Park Circle

  
	
   

  	
  Bluffton,
  South Carolina 29910

  
	
   

  	
   

  
	
  Item
  9

  	
   

  
	
   

  	
   

  
	
  Notice
  information:

  	
  Robert
  P. Trask

  
	
   

  	
  President &
  Chief Executive Officer

  
	
   

  	
  Atlantic
  Bancshares, Inc.

  
	
   

  	
  One
  Sheridan Park Circle, PO Box 3077

  
	
   

  	
  Bluffton,
  South Carolina 29910

  
	
   

  	
   

  
	
   

  	
  With
  a copy to:

  
	
   

  	
   

  
	
   

  	
  Benjamin A. Barnhill, Esq.

  
	
   

  	
  Nelson Mullins Riley & Scarborough LLP

  
	
   

  	
  Suite 900, Poinsett Plaza

  
	
   

  	
  104 S. Main Street

  
	
   

  	
  Greenville, South Carolina 29601