Document:

1st United Bank

$5,000,000 Subordinated Capital Note

________________________________

PURCHASE AGREEMENT

________________________________

July __,
    2008

1st United Bank (the “Bank”), a Florida banking corporation and wholly owned subsidiary of 1st United Bancorp, Inc. (the “Corporation”), upon and subject to the terms and conditions stated herein, is offering, issuing and selling (the “Offering”) a subordinated capital note in the principal amount of $5,000,000 (the “Note”), pursuant to exemptions from registration under Sections 3(a)(2) and 4(2) of the Securities Act of 1933, as amended (the “Securities Act”), Securities and Exchange Commission (the “Commission”) Rule 506 under the Securities Act (“Rule
506”) and Commission Rule 144A under the Securities Act (“Rule 144A”). Capitalized terms used but not defined herein shall have the meanings provided in the certificate representing the Note, and the singular includes the plural.

Silverton Bank, N.A. (the “Purchaser”), based upon the summary term sheet (the “Term Sheet”), which contained a preliminary indication of the principal terms the Purchaser believed appropriate based upon the Purchaser’s analysis of the Bank’s financial data and which terms are incorporated by reference herein, hereby agrees to purchase the Note. To the extent any terms contained in this Agreement are inconsistent with those contained in the Term Sheet, this Agreement supersedes and replaces those provisions in the Term Sheet.

All references in this Agreement to “Regulation D” shall mean Commission Rules 501 through 508 under the Securities Act. For purposes hereof, the singular shall include the plural and vice versa, and the words “include”, “including”, “included”, and derivations thereof shall mean without limitation by reason of enumeration or otherwise.

In consideration of the premises, the mutual agreements contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each party, the parties, intending to be legally bound, agree as follows:

1.              Purchase of Note. Subject to the performance by the Bank of all its obligations hereunder, and in reliance upon the completeness and accuracy of each of the Bank’s representations, warranties and covenants, the Purchaser, upon the terms and conditions of this Agreement, hereby agrees to purchase the Note for the principal amount of  $5,000,000.  Upon the purchase of the Note, the Bank shall pay Purchaser a “Loan Fee” equal to 0.75% of the principal amount of the Note, or $37,500.

 

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2.
 	
Closing; Delivery and Payment.
 

 (a)       If the conditions described in Section 5 hereof have been satisfied or waived, the closing of the Offering (the “Closing”) will be held at the offices of Powell Goldstein LLP, One Atlantic Center, 1201 W. Peachtree Street, Atlanta, Georgia 30309-3488, or such other place as is agreed upon by the Purchaser and the Bank, as soon as practicable thereafter. The date on which the Closing is held shall be referred to herein as the “Closing Date.” As part of the Closing, the Bank will deliver to the Purchaser one or more definitive certificates representing the Note purchased hereby and Purchaser shall deliver payment for the Note in an amount equal to the principal amount of the Note less the Loan Fee set forth in Section 1.

3.              Bank
        Representations, Warranties and Covenants. The Bank represents
        and warrants to, and agrees with the Purchaser that as of the date hereof
        and on the Closing Date:

(a)       Neither the Bank nor any of its “Affiliates” (as defined in Rule 501 of Regulation D), nor any person acting on its or their behalf has directly or indirectly (i) engaged in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with any offer or sale of the Note, or (ii) made offers or sales of any security, or solicited offers to buy or sell any security, under circumstances that would require the registration of the Note under the Securities Act or the securities or blue sky laws of any applicable jurisdiction.

(b)       Neither the Bank nor any of its Affiliates, nor any person acting on its or their behalf, has engaged or will engage in any directed selling efforts with respect to the Note within the meaning of Regulation S.

(c)       The Bank is not, and upon the issuance and sale of the Note and the application of the proceeds thereof will not be, an “investment company” or an entity “controlled” by an “investment company,” in each case within the meaning of Section 3(a) of the Investment Company Act of 1940, as amended (the “Investment Company Act”) without regard to Section 3(c) of the Investment Company Act.

(d)       Neither the Bank nor any of its “Subsidiaries” (as defined in Commission Regulation S-X, Rule 1-02(x)) has any arrangement, understanding or agreement to have any person to solicit offers to purchase, to make any offers to sell, or to sell or purchase the Note.

(e)       The Bank is a Florida commercial banking corporation duly organized, validly existing and in good standing under the laws of its state of organization and has the full corporate power and authority to own, lease and operate its properties, to own its Subsidiaries, and to conduct its business and to enter into and perform its obligations under this Agreement. The Bank has all necessary authorizations, approvals, registrations, orders, licenses, certificates, consents and permits (collectively, “Approvals”), and is duly qualified to transact business as a depository institution, except to the extent that the failure to have such Approvals, to so qualify or to be in good standing has not had and is not reasonably likely to have a Material Adverse Effect.  A “Material Adverse Effect” means any event, action, omission or condition that: (i) has had or is reasonably likely to have a material adverse effect on the condition (financial or 

 

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otherwise), earnings, cash flows, business or prospects of the Bank and Bank Subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, (ii) has had or is reasonably likely to have a material adverse effect on the rights of Holder of the Note, or (iii) seeks to restrain, enjoin, limit or prohibit the execution, delivery or performance of this Agreement or the Note. All of the outstanding shares of capital stock of the Bank (“Bank Shares”) have been duly authorized and validly issued and are fully paid and non-assessable, and none of the outstanding Bank Shares was issued in violation of any preemptive or similar rights of any shareholder of the Bank.

(f)        Attached as Schedule 1 is a list of all the Bank’s direct and indirect Subsidiaries (“Bank Subsidiaries”). Each Bank Subsidiary has been duly organized and is validly existing under the laws of its jurisdiction of organization; each Bank Subsidiary has all corporate or entity power and authority and Approvals necessary to own, lease and operate its properties and to conduct its business as presently operated, and is duly qualified as a foreign entity to transact business and is in good standing in each jurisdiction where such qualification is required, except where the failure to so qualify or to be in good standing would not have a Material Adverse Effect. All of the issued and outstanding shares of capital stock of each Bank Subsidiary have been duly authorized and validly
issued, are fully paid and non-assessable, and are owned by the Bank, directly or indirectly, free and clear of any security interest, mortgage, pledge, lien, hypothecation, negative pledge, charge, encumbrance, adverse claim or equity (each a “Lien”).  None of the outstanding shares of capital stock of any Bank Subsidiary was issued in violation of any preemptive or similar rights of such Bank Subsidiary arising by operation of law, under their respective charters, articles or certificate of incorporation or organizational documents, by-laws, or other organizational or constituent documents (“Organizational Documents”), or under any contract to which the Bank or any Bank Subsidiary is a party. Neither the Bank nor any of its Subsidiaries beneficially owns any shares of stock or any other equity securities of or interest in any entity, except securities or interests held
in the ordinary course of business or securities or interests acquired in satisfaction of debts previously contracted in good faith.

(g)       The Bank, the Corporation and the Bank Subsidiaries operate and are in compliance with all applicable laws, ordinances, rules and regulations of, and all commitments to, all judgments, orders, rulings and decrees of and agreements with (collectively, “Laws”), all applicable governmental, regulatory and self-regulatory agencies (including any securities exchange or market where any of the Bank’s, the Corporation’s or any Bank Subsidiary’s securities are listed or traded), courts, arbitrators, bodies and authorities (“Governmental Authorities”) and all Approvals, except for those violations of which, individually or in the aggregate, would not have a Material Adverse Effect.

(h)       The Bank will include the Note as part of its long-term debt on its financial statements in accordance with GAAP.

(i)        The execution, delivery and performance of this Agreement and the Note have been duly authorized by the Bank, and, when executed and delivered by or on behalf of the Bank, this Agreement and the Note will be valid and binding obligations of the Bank, enforceable against the Bank in accordance with their respective terms, except as enforceability may be limited by bankruptcy laws, other similar laws affecting creditors’ rights, and general 

 

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principles of equity affecting the availability of specific performance and other equitable remedies. The resolutions authorizing the Note and this Agreement shall be maintained continuously as permanent official records of the Bank.

The Note has been duly authorized by the Bank and, when executed, authenticated, issued and delivered against payment therefor to the Purchaser, will be validly issued, fully paid and nonassessable.

(j)        The execution, delivery and performance of this Agreement and the Note (i) have been duly authorized by the Bank, (ii) do not require any consent or Approval under, do not and will not conflict with, constitute a breach of, or a default or an event, which with notice, lapse of time or both would be a default under, an event or condition that gives any person the right to require the repurchase, redemption or repayment of all or a portion of any note, debenture or other indebtedness of the Bank or any Bank Subsidiary (each a “Repayment Event”), (iii) will not result in the creation or imposition of any Lien upon any property or assets of the Bank or any of its Subsidiaries, under any contract, indenture, mortgage, loan agreement, note, lease or other agreement or instrument
(“Contract”) to which the Bank or any of its Subsidiaries is a party or by which it or any of them may be bound, or to which any of the property or assets of any of them is subject, except for a conflict, breach, default or Lien which does not have and is not reasonably likely to have, individually or in the aggregate, a Material Adverse Effect, nor will any such action result in any violation of this Agreement.

(k)       (i) Each of the audited consolidated financial statements, including the notes and schedules thereto, of the Corporation and its consolidated subsidiaries (and where the Corporation has been formed within the last five years, of its predecessors and their respective consolidated Subsidiaries) as of and for the last full five years (the “Annual Financial Statements”) and the interim unaudited consolidated financial statements of the Corporation and its consolidated subsidiaries as of and for the latest interim periods and the corresponding interim periods of the immediately preceding year (the “Interim Financial Statements,” and collectively with the Annual Financial Statements, (the “Financial
Statements”) provided to the Purchaser has been prepared in accordance with GAAP, Section 36 of the FDIA, and applicable regulations thereunder, and to the extent the Corporation files reports under Sections 13 or 15(d) of the 1934 Act, to the 1934 Act and the Commission’s rules and regulations thereunder, including Regulation S-X.  Such Financial Statements, in all cases, fairly present in all material respects the consolidated and parent-only financial condition, earnings, cash flows and changes in shareholders’ equity as of the dates and for the periods therein specified, subject, in the case of Interim Financial Statements, only to normal recurring year-end audit adjustments that are not material, and each has been certified as required by applicable Law. The Corporation and the Bank have a duly constituted audit committee of its Board of Directors (the “Audit Committee”), composed
entirely of members who are “independent” in accordance with applicable Law, including FDIA Section 36, and applicable regulations thereunder. Such Audit Committee has operated consistent in all material respects with any applicable state and federal banking and other Laws, and, to the extent that the Corporation files reports under the 1934 Act or has a class of securities listed or traded on any securities exchange or Nasdaq market, the 1934 Act, the Commission’s rules and regulations, and the applicable rules of such exchange or Nasdaq.  

 

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(ii) All the Bank’s call reports (“Call Reports”) submitted to its primary federal and state regulators conform in all material respects to the Federal Financial Institutions Examination Council’s (“FFIEC”) requirements for Call Reports, and all such Call Reports conform to the requirements of Section 37 of the FDIA and applicable regulations thereunder, and are accurate and complete in all material respects and fairly present in all material respects the reporting entity’s financial condition, earnings, cash flows (to the extent a statement of cash flows is included pursuant to the requirements of such forms) and changes in shareholders’ equity as of the dates and for the periods shown consistent with the Financial Statements as of and for the
corresponding dates and periods.

(l)        If required by applicable state and federal banking, securities and other Laws, each of the accountants who certified or reviewed the Financial Statements are “independent public accountants.”

(m)      There are no investigations, actions or proceedings by or before any Governmental Authority pending, or, to the best knowledge of the Bank, threatened against or affecting the Bank or any of its Subsidiaries, that have had or are reasonably likely to have, individually or in the aggregate, a Material Adverse Effect.

(n)       Since the respective dates of the Financial Statements and Interim Financial Statements provided to the Purchaser, there has not been (i) any event, action, omission or condition that has had a Material Adverse Effect, (ii) any transactions entered into by the Bank or any Bank Subsidiary, other than in the ordinary course of business, that are material to the Bank and its Subsidiaries considered as one enterprise, (iii) except for any regular cash dividends on the Bank’s common stock in the ordinary course of business consistent with past practice, any dividend or distribution of any kind declared, paid or made by the Bank on its capital stock or other securities, nor (iv) any other event, action, omission or condition that is reasonably likely to have a Material Adverse Effect.

(o)       The Bank, the Corporation and the Bank Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general and specific authorizations; (ii) transactions are recorded as necessary to permit the preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorizations; (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences, and (v) otherwise complies in all material respects with all applicable federal and state banking, securities and other applicable Laws, including the Foreign
Corrupt Practices Act, the Sarbanes-Oxley Act of 2002, and the Commission’s rules and regulations thereunder.

(p)       The Bank, the Corporation and the Bank Subsidiaries have filed all federal, state, local and foreign tax returns that are required to be filed or have duly requested extensions thereof and have paid all taxes required to be paid by any of them and any related assessments, fines or penalties, except for any such tax, assessment, fine or penalty that is being contested in good faith and by appropriate proceedings; and adequate charges, accruals and reserves have been provided for in the Financial Statements in respect of all federal, state, local 

 

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and foreign taxes, including for all periods and amounts as to which the tax liability of the Bank or its Subsidiaries is being contested, has not been finally determined or remains open to examination by applicable taxing authorities and where such taxes have not become due and payable.

(q)       None of the Bank, the Corporation or any of the Bank Subsidiaries is in violation of its respective Organizational Documents, or in default (including any condition or occurrence of any event that with notice, the lapse of time or both, would be a default) in the performance or observance of any obligation, agreement, covenant or condition contained in any Contract, to which any of them is a party or by which it or any of them may be bound or to which any of the property or assets of any of them is subject, which violation or default would have a Material Adverse Effect.

(r)        No filing with, or Approval of, any Governmental Authority, other than those that have been made or obtained and which remain in full force and effect, is necessary or required for the performance by the Bank of its obligations hereunder, in connection with the issuance and sale of the Note or the consummation of this Agreement. The Bank has given appropriate written notice to its federal and state banking regulators and the other Governmental Authorities having jurisdiction over the Bank, of its intent to issue the Note, and neither the federal and state banking regulators nor any other applicable Governmental Authority has expressed any objection to the Offering, and the Bank has no reason to know that the Note will not be includible in the Bank’s Tier 2 Capital under applicable capital adequacy guidelines and rules.  The Bank shall
confirm such matters in an officers’ certificate delivered to the Purchaser at the Closing.

(s)        To the Bank’s knowledge, no labor problem exists or is imminent with employees of the Bank, the Corporation or any of the Bank Subsidiaries that has had or is reasonably likely to have a Material Adverse Effect, and the Bank is not aware of any existing or imminent labor disturbance by the employees of any of the Bank’s, the Corporation’s or Bank Subsidiaries’ principal suppliers, contractors or customers that has had or is reasonably likely to have a Material Adverse Effect.

(t)        To the Bank’s knowledge, the Bank, the Corporation and the Bank Subsidiaries carry, or are entitled to the benefits of, insurance and blanket bonds from insurers of recognized financial standing in such amounts and covering such risks as is generally maintained by companies of a similar size and of established reputation engaged in the same or similar businesses as the Bank, the Corporation and the Bank Subsidiaries, and all such insurance is in full force and effect, and the Bank has not received or given any notice of cancellation, nonrenewal or material increase in the cost of such insurance.

(u)       The Bank, the Corporation and Bank Subsidiaries each owns or possesses, or can readily acquire on reasonable terms, patents, patent licenses, trademarks, service marks and trade names necessary to carry on their businesses as presently conducted, and neither the Bank, the Corporation nor any Bank Subsidiary have received any notice of infringement of or conflict with asserted rights of others with respect to any patents, patent licenses, trademarks, service marks or trade names that, in the aggregate, if the subject of an unfavorable decision, ruling or finding, has had or is reasonably likely to have a Material Adverse Effect.

 

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(v)       The Bank, the Corporation and Bank Subsidiaries each has good and marketable title to all its respective properties and assets, free and clear of all Liens, except as are neither material in amount nor materially significant in relation to the business of the Bank, the Corporation and Bank Subsidiaries considered as one enterprise.  All of the Contracts material to the business of the Bank, the Corporation and Bank Subsidiaries considered as one enterprise, and under which the Bank, the Corporation or any Bank Subsidiary holds properties or assets, are in full force and effect, and neither the Bank, the Corporation nor any of the Bank Subsidiaries has any notice of any material claim that has been asserted by anyone adverse to the rights of the Bank, the Corporation or such Bank Subsidiary under any such Contracts, or affecting or questioning
the rights of such entities to the continued possession of the leased or subleased premises or other assets under any such Contract.

(w)      Other than such agreements, instruments and other documents that are filed as Exhibits to the Bank’s periodic reports, if any, filed by the Bank with its primary federal banking regulator or filed by the Corporation pursuant to the 1934 Act and have been provided to the Purchaser, there are no agreements, contracts or documents of a character described in Item 601 of Regulation S-K under the Securities Act to which the Bank or any of its Subsidiaries is a party or to which any of them or any of their assets are subject or bound.

(x)       The Note is being issued pursuant to valid exemptions from registration under Sections 3(a)(2) and 4(2) of the Securities Act and Regulation D thereunder, and is eligible for resale pursuant to Rule 144A and is not of the same class as securities listed on a national securities exchange registered under Section 6 of the 1934 Act, or quoted in a U.S. automated interdealer quotation system.

(y)       Any certificate signed by any officer or director of the Bank and delivered to the Purchaser or to counsel for the Purchaser shall be deemed a representation, warranty and covenant by the Bank to the Purchaser as to the matters covered thereby.

	
 
 	
4.
 	
Bank Covenants. The Bank agrees with the Purchaser that:
 

 (a)       The Bank will pay all reasonable costs and expenses incurred in connection with this Agreement, the Note and the transactions contemplated herein, including all reasonable fees and expenses of its and Purchaser’s legal counsel.

(b)       The Bank will not, and will not permit any of its Affiliates or any person acting on its behalf to, directly or indirectly, make offers or sales of any security, or solicit offers to buy any security, under circumstances that would require the registration of the Note under the Securities Act or the appointment and qualification of any trustee or the filing of any indenture under the Trust Indenture Act of 1939, as amended.  Without limiting the generality of the immediately preceding sentence, the Bank will not and will cause its Affiliates not to make any offer or sale of securities of the Bank of any class if, as a result of the doctrine of “integration” under the Securities Act, such offer or sale would render invalid (for the purpose of (i) the offer or sale of the Note to the Purchasers, (ii) the resale of the Note by the
Purchaser or (iii) the resale of the Note to others by such subsequent purchasers from the Purchaser), the exemption from the registration requirements of the Securities Act provided by Section 4(2) thereof, by Rule 144A, Rule 144, “Rule 4(11⁄2),” Regulation S or other exemptions thereunder.

 

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(c)       The Bank will not, nor will the Bank permit any of its Affiliates or any person acting on its or their behalf to, engage in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with any offer or sale of the Note.

(d)       The Bank will not, nor will the Bank permit any of its Affiliates or any person acting on its or their behalf to, engage in any directed selling efforts within the meaning of Regulation S with respect to the Note.

(e)       None of the Bank, the Corporation nor any Bank Subsidiary will take, directly or indirectly, any action designed to, or that might reasonably be expected to, cause or result in stabilization or manipulation of the price of any security of the Bank or the Corporation to facilitate the sale or resale of the Note.

(f)        The Bank will perform timely all its covenants and obligations contained in the Note.

(g)       The Bank will use all commercially reasonable efforts to do and perform all things required to be done and performed by it under this Agreement prior to and after the Closing Date to satisfy its obligations hereunder.

(h)       The Bank, promptly following the Closing may issue a press release, in a form reasonably acceptable to the Purchaser, announcing the sale of the Note hereunder, and if the Bank or the Corporation file reports pursuant to Sections 13 or 15(d) of the 1934 Act, the Bank or the Corporation will file such press release with the appropriate primary federal regulator or the Commission, as the case may be, on a Form 8-K.

(i)        The Bank and the Corporation will, so long as the Note is outstanding, file with the appropriate primary federal regulator or the Commission, as the case may be, all reports specified under Sections 13 or 15(d) of the 1934 Act to the extent that the Bank or the Corporation is otherwise required to file such information and will make available to any prospective purchaser of the Note the information required by Rule 144A(d)(4) under the Securities Act. The Bank shall cause to be prepared annual unaudited consolidated financial statements consistent with the provisions of subsections 3(k), and 3(l) hereof and will maintain the system of internal controls consistent with subsection 3(o) hereof. 

(j)        It is understood and agreed that the transaction documents are proprietary to the Purchaser and will not be copied or used by the Bank, the Corporation or any of the Bank Subsidiaries or representatives for any purposes other than the transactions contemplated hereby, except as required by applicable law or court process. Notwithstanding the foregoing, the Bank (and any employee, representative or other agent of the Bank) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement, all other transaction documents, and all materials of any kind (including opinions or other tax analyses) that are provided to the Bank to the extent such materials relate to such tax treatment and tax structure; provided,
however, any such information relating to the tax treatment or tax structure shall be kept confidential to the extent necessary to comply with any applicable federal or state securities laws.

 

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(k)       With respect to any offering and sale of any Bank securities, whether such capital stock is common stock, preferred stock, debt or otherwise, occurring within the six month period following the date of this Agreement, the Bank shall either:

(i)        register such securities pursuant to requirements of the Securities Act and comply with Rule 152 of the same, or;

(ii)       ensure all such offers and sales of capital stock will be made (A) exclusively to “accredited investors,” as that term is defined in Commission Rule 501 under the Securities Act, or to fewer than 30 nonaccredited investors each of whom the Bank reasonably believes to be sophisticated, (B) in compliance with the information delivery requirements set forth in Commission Rule 502(6) under the Securities Act, (C) without any form of general solicitation or general advertising within the meaning of Commission Rule 502(c) under the Securities Act, (D) in compliance with the resale limitation requirements of Commission Rule 502(d) under the Securities Act, and (E) otherwise in compliance with the private offering exemption provided by Section 4(2) of the Securities Act and the safe harbor provided by Commission Rule 506 thereunder; and

(l)        Notwithstanding (k) above, the Bank will take all reasonable steps to ensure that any such offers and sales of securities by the Bank in the six month period following the date of this Agreement will not be “integrated,” as that term has been defined by the Commission, with the Offering or otherwise cause the offer and sale of the Securities to not be exempt from the registration requirements of the Securities Act pursuant to the exceptions provided in Commission Rule 506.

5.              Conditions
        to the Purchaser’s Obligations. The Purchaser’s obligations
        under this Agreement are subject to the accuracy of the Bank’s representations
        and warranties and to the performance by the Bank of its respective covenants,
        agreements and obligations hereunder and under this Agreement, the Term
        Sheet, the other transaction documents, and to the following additional
        conditions:

(a)       The Bank shall have furnished to the Purchaser certified resolutions approving this Agreement and the Note, and an incumbency certificate as to the Bank’s officers.

(b)       There shall not have occurred (i) any change, or any development or event involving a prospective change, in the condition (financial or otherwise), earnings, cash flows, business or prospects of the Bank or its Subsidiaries which, in the judgment of the Purchaser, is material and adverse and makes it impractical or inadvisable to proceed with the completion or the sale of and payment for the Note; (ii) any suspension or limitation of trading in securities generally on the New York Stock Exchange, the American Stock Exchange, Nasdaq, or any over-the-counter securities market, or any material disruption of the settlement of trading on any such exchange or over-the-counter market generally, or the establishment of minimum prices for trading securities generally on any such exchange or any over-the-counter market, or any suspension of trading of
any securities of the Bank on any exchange or in the over-the-counter market; (iii) any banking moratorium declared by any United States federal authorities or state authorities; (iv) the lowering or withdrawal of any rating assigned to any securities or deposits issued or guaranteed by the Bank or any of its Subsidiaries by any rating agency, or the public 

 

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announcement or disclosure to the Bank by any rating agency that it has under surveillance or review, with possible negative consequences, its rating of any securities or deposits issued or guaranteed by the Bank or its Subsidiaries or (v) any outbreak or escalation of hostilities, any declaration of a national emergency or war by the United States or any other national or international calamity, crisis or emergency, any act or acts of terrorism, or any change in the financial markets if, in the judgment of the Purchaser, the effect of any such outbreak, escalation, act, declaration, calamity, emergency or change makes it impractical or inadvisable to proceed with solicitations of offers to purchase, or the completion of its sale of, the Note.

(c)       The Bank shall have furnished to the Purchaser a certificate of the Bank, signed by the Chairman, any Vice Chairman, the Chief Executive Officer, the President or any Vice President and by the Treasurer or Chief Financial Officer of the Bank, reasonably acceptable in form and substance to the Purchaser, to the effect that:

(i)        the representations and warranties of the Bank made herein and in each transaction document are true and correct in all material respects on and as of the Closing Date, with the same effect as if made on the Closing Date, and the Bank has complied with its covenants, agreements and obligations hereunder and in the transaction documents and satisfied all the conditions herein and in the transaction documents, including the payment of all other fees and expenses payable under Section 4, on the Bank’s part to be performed or satisfied at or prior to the Closing Date;

(ii)       other than as shown on Schedule 2, since the date of the most recent Financial Statements provided by the Bank to the Purchaser, there has been no material adverse change in the condition (financial or otherwise), earnings, cash flows, business or prospects of the Bank and its Subsidiaries considered as one enterprise, whether arising from transactions in the ordinary course of business or otherwise.

(d)       Prior to the Closing Date, the Bank shall have furnished to the Purchaser such further information, instruments, certificates and documents, as may be reasonably requested by the Purchaser, in form and substance reasonably satisfactory to the Purchaser.

(e)       At the Closing Date, each of the transaction documents shall have been duly authorized, executed and delivered by or on behalf of the Bank thereto, and fully executed counterparts thereof shall have been delivered to the Purchaser, and the Bank shall have paid all reasonable fees and expenses, including all reasonable legal fees and charges, for which it is responsible hereunder.

(f)        Prior to the Closing Date, the Corporation shall have entered in to a $5,000,000 line of credit with the Purchaser pursuant to the term sheet set forth on Schedule 3 hereto.

If any of the conditions specified in this Section 5 shall not have been fulfilled timely in all material respects, or if any of the forgoing documents or other transaction documents shall not be reasonably satisfactory in form and substance to the Purchaser, the Purchaser’s obligations hereunder may be terminated at, or at any time prior to, the Closing Date by the Purchaser. Notice of such termination shall be given to the Bank in writing, or by 

 

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telephone or facsimile confirmed in writing, but no such termination shall affect the Bank’s obligation to pay all reasonable fees and expenses, including all reasonable legal fees and charges incurred by the Purchaser and the Bank.

	
 
 	
6.
 	
Termination.
 

 (a)       This Agreement shall be subject to termination in the absolute discretion of the Purchaser by notice given to the Bank prior to delivery of and payment for the Note as provided in Section 5, or earlier if any Bank representation or warranty is inaccurate or if the Bank fails or is unable to perform, or gives notice of its intent not to perform, any of its covenants, agreements and obligations hereunder.

	
 
 	
7.
 	
Other Agreements.
 

 (a)       The Bank acknowledges and agrees that it has made and will make its own decisions with respect to the desirability to it of the offering, pricing and sale of the Note, and has not relied and will not rely upon the Purchaser or the Purchaser’s Affiliates in making such evaluations and decisions.  This Agreement is not intended to and shall not confer on any person or entity other than the parties hereto and their respective permitted successors and assigns, any relationship, rights or remedies under or by reason of this Agreement or as a result of the services to be rendered by the Purchaser hereunder, whether as third party beneficiaries or otherwise.

(b)       The Bank authorizes the Purchaser following Closing, (i) to place advertisements in financial and other newspapers and journals (including electronic versions thereof) at their own expense describing the Transactions generally, (ii) to use the Bank’s corporate logo in such advertising or related promotional materials (including electronic versions thereof) concerning the Purchaser’s services hereunder, and (iii) to include the Transaction and the Bank in lists of transactions and customers.

(c)       The Bank acknowledges and agrees that there are no understandings, arrangements or agreements with respect to the offer or sale of the Note or the transactions contemplated herein with any finders, brokers, underwriters, agents, salesmen, dealers, representatives or other persons (other than the Purchaser as provided herein) which have any interest in finders’ fees, brokerage commissions, placement or other fees in connection with the Note or the transactions contemplated herein, and the Bank shall indemnify, defend and hold harmless the Purchaser from and against any and all claims for such compensation.

(d)       The Purchaser acknowledges that, for purposes of selling the Note to the Purchaser in compliance with applicable law, the Bank and the Corporation have given access to, and the Purchaser has become acquainted with (and will become acquainted with, pursuant to its access rights under this Agreement and the Note), certain material nonpublic information concerning the Bank and the Corporation, including but not limited to, confidential information regarding the business prospects and operations of the Bank and the Corporation (the “Confidential Information”).  Until such time as the Confidential Information shall become public through no fault or disclosure of the Purchaser, the Purchaser agrees to maintain the strict confidentiality of all of the Confidential Information and that it shall not in any manner, either directly or indirectly,
divulge, disclose or communicate to any person or entity, or use in any 

 

11

WPB 990283.2 00025922.00018 

 

 

 

manner, any of the Confidential Information.  The Purchaser acknowledges and agrees that it will be viewed as a temporary insider until this Confidential Information is disclosed to the public, and any breach of this provision may subject the Purchaser to insider trading liability.  

8.              Survival.
    The respective representations, warranties and covenants made by or on behalf
    of the Bank or their respective officers set forth in or made pursuant to
    this Agreement will remain in full force and effect, regardless of any investigation
    made by or on behalf of the Purchaser, and will survive delivery of and payment
    for the Note and shall be deemed made as to and for the benefit of any Purchaser
    of the Note.

9.              Notices.
    All communications hereunder will be in writing and effective only on receipt,
    and, if sent to the Purchaser, will be mailed, delivered or sent by facsimile
    and confirmed to it at 2410 Paces Ferry Road, 600 Paces Summit, Atlanta,
    Georgia 30339-4098, fax number (770) 805-6543 Attention: Frank Brown, with
    a copy to Lyn G. Schroeder, Powell Goldstein LLP, One Atlantic Center, 1201
    W. Peachtree Street, Atlanta, Georgia 30309-3488, fax number (404) 572-6999;
    if sent to the Bank will be mailed, delivered or sent by facsimile and confirmed
    to it at 1st United Bank, One North Federal Highway, Boca Raton, FL 33432,
    fax number (561) 362-3439, Attention: John Marino.

10.              Successors
        and Assigns. This Agreement will inure to the benefit of and
        be binding upon the parties hereto and their respective successors and
        assigns. The Bank may not assign this Agreement and may not delegate
        its duties hereunder, except as permitted by the terms of Section 4.0C
        of the Note.

11.              Applicable
        Law; Venue. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED
        IN ACCORDANCE WITH THE LAW OF THE STATE OF GEORGIA WITHOUT REFERENCE
        TO ITS CONFLICTS OF LAW PROVISIONS. ANY ACTION, SUIT OR PROCEEDING ARISING
        OUT OF OR RELATED TO THIS AGREEMENT OR ANY TRANSACTION HEREUNDER SHALL
        BE BROUGHT EXCLUSIVELY IN FEDERAL OR STATE COURT IN THE NORTHERN DISTRICT
        OF GEORGIA, WHICH ALL PARTIES AGREE IS A REASONABLE VENUE.

12.              Entire
        Agreement, Amendments, etc. Except as otherwise expressly provided
        herein, this Agreement (including the annexes, schedules and exhibits
        attached hereto and any other documents which are incorporated by reference
        into this Agreement) constitutes the entire agreement between the parties
        with respect to the offering and sale of the Note and the transactions,
        and supersedes all prior arrangements, agreements or understandings with
        respect thereto, written or oral. This Agreement may be amended or modified
        only in writing executed by all the parties hereto. Any waiver hereof
        must be in writing executed by the party entitled to give such waiver
        to be effective. If any provision of this Agreement is determined to
        be unenforceable, the other  provisions shall remain in full force and
        effect.

13.              Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.  Confirmation of execution by electronic transmission of a facsimile signature page shall be binding upon any party so confirming.

 

12

WPB 990283.2 00025922.00018 

 

 

 

[signatures on the following page]

 

13

WPB 990283.2 00025922.00018 

 

 

 

IN WITNESS WHEREOF, each of the parties has executed and delivered this Subordinated Capital Note Purchase Agreement as of the date first above written.

 

1ST UNITED BANK 

 

	By:	
/s/
    John Marino
 
	Name:	
 John
    Marino
 
	Title: 	
CFO/COO
 

 

SILVERTON BANK, N.A.

 

	By:	
/s/
    Jeffrey S. Neale
 
	 	Name: Jeffrey S. Neale
	 	Title: Senior Vice President

 

 

14

WPB 990283.2 00025922.00018 

 

 

 

SCHEDULE 1

List of Subsidiaries

	
 
 	
Type of
 	
Jurisdiction Where
 

	
Name
 	
Organization
 	
Organized
 
	None	 	 

 

 

 

SCHEDULE 2

MATERIAL
      ADVERSE CONDITIONS

NONE

 

 

SCHEDULE 3

Line of Credit Term Sheetexhibit102.htm -- Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing

	
LOAN AND STOCK PLEDGE AGREEMENT

     THIS LOAN AND STOCK PLEDGE AGREEMENT (the "Agreement"), entered into as of July 2, 2008,
by and between 1ST UNITED BANCORP, INC., a Florida corporation (the "Borrower"), and SILVERTON BANK, N.A. (the "Lender").

     On the date hereof the Borrower is borrowing up to the principal amount of Five Million and
00/100 Dollars ($5,000,000.00) from the Lender (the "Loan"), which will be evidenced by the Note as defined herein below. The Lender is willing to make the Loan to the Borrower on
the terms and conditions described below. The Borrower and Lender agree that the payment and performance of all obligations relating to the Loan will be secured through the pledge to the Lender of one hundred percent (100%) of the issued and
outstanding shares of capital stock owned or hereafter acquired by the Borrower (the "Stock") in 1st United Bank,
a Florida banking corporation, having its main office at One North Federal Highway, Boca Raton, Florida 33432 (the “Bank”). Certain capitalized terms used in this Agreement are defined in Section 22 of this Agreement.

     In consideration of the premises and the mutual agreements and representations in this Agreement, the Lender and the Borrower agree as follows:

     1.     Security
Interest.

     (a)    The
Borrower hereby unconditionally grants and assigns to the Lender and its successors
and assigns a continuing security interest in and security title to the Stock.
The Borrower hereby delivers to the Lender all of its right, title and interest
in and to the Stock,
together with certificates representing the Stock and stock powers endorsed in
blank, as security for (i) all obligations of the Borrower to the Lender hereunder,
and (ii) payment and performance of all obligations of the Borrower to the Lender
 under the Note, whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due. If the Borrower receives, for any reason whatsoever,
any additional shares of the capital stock of the Bank, such shares shall
thereupon constitute Stock to be held by the Lender under the terms of this Agreement
and the Borrower shall immediately deliver such shares to the Lender, together
with stock powers endorsed in blank by the Borrower. Beneficial ownership of
the  Stock, including all voting, consensual and dividend rights, shall remain
in the Borrower until the occurrence of a Default.

     (b)    The Amount of the Loan shall not exceed twenty five percent (25%) of Bank’s total equity. If, prior to repayment in full of the Loan, the amount of the
Loan exceeds twenty five percent (25%) of Bank’s total equity, the Borrower shall either pay down the outstanding principal balance of the Loan or promptly deliver to the Lender on demand additional collateral of a type and value acceptable to
the Lender (and the Lender's judgment in valuing same shall be conclusive) so that the sum of the value of such additional collateral plus the Stock is equal to or in excess of the aforementioned twenty five percent (25%). The Borrower shall also
execute any security documents the Lender may request to evidence and perfect the Lender's rights in such additional collateral. If at any time such additional collateral is no longer required pursuant to this Section 1(b), the Lender shall release
its security interest in such additional collateral upon the request of the Borrower.

     2.    Representations and Warranties. The Borrower represents and warrants to the Lender as follows:

           (a)      The Borrower is a corporation duly organized, validly existing, and in good standing under the laws of the State of Florida and is qualified to do business in
all jurisdictions where such qualification is necessary. The Borrower is registered as a bank holding company with the Board of Governors of the Federal Reserve System and the Florida Department of Banking and Finance. The chief executive office of
the Borrower and the principal place of business of the Borrower where the records of the Borrower are kept is One North Federal Highway, Boca Raton, Florida 33432 and the Borrower's U.S. employer identification number is 65-0925265.

           (b)      The
Bank is a corporation duly organized, validly existing, and in good standing
under the laws of the State of Florida. The Borrower owns 100% of the Stock
(consisting 537,710 Shares of 1st United Bank, represented by certificate
Nos. 1) and there are no other outstanding shares of capital stock and no outstanding
options, warrants or other rights, which can be converted into shares of capital
stock of the Bank, and the Bank shall not issue any additional shares without
the prior written consent of Lender, which shall not be unreasonably withheld.
The Bank has all requisite corporate power and authority and possesses all licenses,

permits and authorizations necessary for it to own its properties and conduct its business as presently conducted.

           (c)      Each financial statement of the Borrower or any Subsidiary which has been delivered to the Lender presents fairly in all material respects the financial
condition of the Borrower or such Subsidiary as of the date indicated therein and the results of its operations for the periods shown therein. There has been no material adverse change, either existing or threatened, in the financial condition or
operations of the Borrower or any Subsidiary since the date of such financial statement.

           (d)      The Borrower has full power and authority to execute and perform the Financing Documents. The execution, delivery, and performance by the Borrower of the
Financing Documents (i) have been duly authorized by all requisite action by the Borrower, (ii) do not violate any provision of law, and (iii) do not result in a breach of or constitute a default under any agreement or other instrument to which the
Borrower or any Subsidiary is a party or which the Borrower or any Subsidiary is bound. Each of the Financing Documents constitutes the legal, valid, and binding obligation of the Borrower enforceable in accordance with its terms.

           (e)      Except for the security interest created by this Agreement, the Borrower owns the Stock free and clear of all liens, charges, and encumbrances. The Stock is
duly issued, fully paid and non-assessable, and the Borrower has the unencumbered right to pledge the Stock.

           (f)      There is no action, arbitration, or other proceeding at law or in equity, or by or before any court, agency, or arbitrator, nor is there any judgment, order, or
other decree pending, anticipated, or threatened against the Borrower or any Subsidiary or against any of their properties or assets which might have a material adverse effect on the Borrower, any Subsidiary, or their respective properties or
assets, or which might call into question the validity or enforceability of the Financing Documents, or which might involve the alleged violation by the Borrower or any Subsidiary of any law, rule or regulation.

           (g)      No consent or other authorization or filing with or of any governmental authority or other public body on the part of the Borrower or any Subsidiary is required
in connection with the Borrower's execution, delivery, or performance of the Financing Documents; or if required, all such prerequisites have been fully satisfied.

           (h)      None of the transactions contemplated in this Agreement (including, without limitation, the use of the proceeds of the Loan) will violate or result in a
violation of Section 7 of the Securities Exchange Act of 1934, or any regulations issued pursuant thereto.

           (i)
     The following are attached as exhibits hereto: true, correct and complete copies
of (i) the Borrower's and the Bank's Articles of Incorporation as in effect as
 of the date hereof; (ii) certificates of existence/evidence of active status
for the Borrower and the Bank issued by the Florida Secretary of State; (iii)
the bylaws of the Borrower in effect immediately prior to the adoption of the
resolutions
referred to below (and such bylaws have not been further altered or amended and
have been in full force and effect at all times since the adoption of such resolutions
through the date hereof); (iv) the bylaws of the Bank as of the date hereof;
(v)
resolutions (the "Resolutions") of the Board of Directors of the Borrower duly
adopted as of even date herewith via an Action By Written Consent. A quorum for
the transaction of business has signed same and the Resolutions have been since
adoption  and are now in full force and effect and have not been modified in
any respect. There have been no further amendments or other documents affecting
or altering the Borrower's or the Bank's articles of incorporation since the
date of the
certifications referred to above through the date hereof except with respect
to the acquisition of Equitable Financial Group, Inc., and the Borrower and the
Bank have remained in valid existence under the laws of the State of Florida
since such
dates.

     3.      Affirmative Covenants. The Borrower agrees that so long as the Note is outstanding or this Agreement is in effect:

             (a)     The Borrower shall provide on a quarterly basis, as soon as practicable, and in any event within forty-five (45) days after the end of each quarter of
Borrower’s fiscal year: (i) an internally generated consolidated financial statement of Borrower and Subsidiaries (consisting of profit and loss statement, balance sheet, cash flow statement and report on changes in stockholder’s equity),
certified to the Lender by an authorized financial officer of the Borrower acceptable to the Lender; (ii) a Covenant Compliance Certificate as more particularly

2

set forth herein below; and (iii) a copy of the quarterly and annual call report and any other quarterly regulatory reports and filings as required by any Governmental Authority having
supervisory authority over the Borrower or any Depository Institution Subsidiary for each Depository Institution Subsidiary for the most recent calendar quarter and year. “Covenant Compliance Certificate” shall mean a certificate, in form
and content satisfactory to the Lender, which shall: (a) set forth the various financial covenants and ratios which the Borrower and the Depository Institution Subsidiaries are required to comply with during the term of this Agreement; (b) contain
calculations reflecting whether or not the Borrower or each Depository Institution Subsidiary, as the case may be, is in compliance with each such financial covenant or ratio requirement; (c) contain a statement as to whether or not the Borrower is
in default under the Loan Agreement or any of the other Loan Documents, and, if the Borrower is in default, such statement shall indicate the nature thereof as well as the steps which Borrower proposes to take in order to cure said default; and (d)
be certified to be true and correct by an authorized financial officer of the Borrower acceptable to the Lender.

             (b)     Borrower
shall provide as soon as practicable and in any event within one hundred twenty
(120) days after the end of each fiscal year, year end audited  consolidated
financial statements of the Borrower (consisting of profit and loss statement,
balance sheet, cash flow statement and report on changes in stockholders equity)
that are examined and reviewed by a certified public accountant selected by
Borrower and reasonably acceptable to Lender (Lender acknowledges Crowe Chizek
as acceptable), together with the unqualified opinion of such accountant.

             (c)     Borrower
will provide copies of all internal and external loan reviews within 30 days
of issuance. Promptly upon receipt thereof, a copy of each other report  submitted
to the Borrower or any Subsidiary by independent accountants in connection with
any annual, interim or special audit made by them of the books of the Borrower
or any Subsidiary.

             (d)     Promptly
upon transmission thereof, Borrower shall provide copies of all such financial
statements, proxy statements, notices, and reports as it shall send to  its stockholders
and of all registration statements (with exhibits) and all reports which it is
or may be required to file with the Securities and Exchange Commission or any
governmental body or agency succeeding to the functions of such
Commission.

             (e)     Promptly
upon receipt thereof, Borrower shall provide a copy of each other report submitted
to the Borrower or any subsidiary by independent accountants in  connection with
any annual, interim or special audit made by them of the books of the Borrower
or any Subsidiary.

             (f)     The
Borrower and each Subsidiary shall punctually pay and discharge all taxes, assessments
and other governmental charges or levies imposed upon it or upon its  income
or upon any of its property unless contested in good faith by appropriate proceedings.

             (g)     The
Borrower and each Subsidiary shall comply in all material respects with all requirements
of constitutions, statutes, rules, regulations, and orders and all  orders and
decrees of courts and arbitrators applicable to it or its properties.

             (h)     The
Borrower shall quarterly notify the Lender of any change in executive management
or the beneficial ownership of the Borrower's stock by executive officers,  directors
or 25% or greater shareholder of the Borrower.

             (i)     Upon
Lender’s reasonable request, during regular business hours, and upon reasonable
prior notice, the Borrower will allow the Lender to inspect its Books,  to perform
a review of the loan portfolio of each Subsidiary as deemed necessary, and to
review internal and external loan review reports in a manner which is not unduly
disruptive to the business of Borrower.

             (j)     The
Borrower will maintain Debt Service Coverage of at least 1.25x calculated as
set forth in Paragraph 22(d) herein below. This covenant shall be measured
quarterly.

3

             (k)     Bank
must maintain regulatory approval to provide dividends to Borrower necessary
to adequately
service
the Loan.

             (l)      Bank
is to maintain a pass rating from all of its governing regulatory agencies.  

             (m)     In
the event a trust preferred is issued, proceeds of the trust preferred are not
expected to repay the principal of the Loan.

             (n)     Upon
the Lender's written request, the Borrower shall provide any financial information,
and/or other information and/or documentation as reasonably requested by the
Lender, including without limitation, copies of SEC reports, including but not
limited to, 10K
reports, 10Q reports.

     4.     Negative Covenants. The Borrower agrees that so long as the Note is outstanding or this Agreement is in effect:

             (a)     Borrower’s
Tier 1 Capital Leverage Ratio shall be “Adequately Capitalized”, and
shall be measured quarterly.

             (b)     Borrower’s
Tier 1 Risk Based Capital Ratio shall be “Adequately Capitalized”,
and shall be measured quarterly.

             (c)     Subsidiary’s
Tier 1 Capital Leverage Ratio shall be maintained as “Well Capitalized”,
and shall be measured quarterly.

             (d)     Subsidiary’s
Tier 1 Risk Based Capital Ratio shall be “Well Capitalized”, to be
measured quarterly.

             (e)     Borrower’s
Non-Performing Assets (defined as the sum of bank subsidiaries of (i) cash basis
loans, (ii) loans 90 days or more past due, (iii) renegotiated  loans plus, (iv)
other real estate, plus (iv) other assets described as “other non-performing
assets” on Borrower’s consolidated financial statements divided by
the sum of (i) loans plus, (ii) other real estate, shall be less than  1.50%,
measured quarterly.

             (f)     The
Borrower will notify the Lender immediately of all significant changes in executive
management.

             (g)     No
dividend shall be paid by the Borrower if the Loan is in default or if the dividend
would create a default without prior Lender approval.

             (h)     The
Borrower shall not, directly or indirectly, become a guarantor of any obligation
of, or an endorser of, or otherwise assume or become liable upon any notes,
obligations, or other indebtedness of any other Person (other than a Subsidiary)
except in connection with the depositing of checks in the normal and ordinary
course of business.

             (i)     The
Borrower shall not create, incur, assume or suffer to exist any indebtedness or Liabilities (other than this facility) for borrowed money, any indebtedness evidenced by notes, debentures or similar obligations or any conditional sales or title retention
agreements or capitalized leases, which in any single case, or in aggregate, exceed One Million and 00/100 Dollars ($1,000,000.00), without the prior written consent of the Lender, which shall not be unreasonably withheld.

             (j)     The
Borrower shall not permit any Subsidiary to issue, sell or otherwise dispose
or part with control of any shares of any class of its stock (other than
directors’ qualifying shares) except to the Borrower or a wholly-owned Subsidiary
of the Borrower.

4

             (k)     The
Borrower shall not sell or otherwise dispose or part with control of any of the
Stock or any other securities or indebtedness of any Subsidiary, and the  Borrower
shall not pledge or otherwise transfer or grant a security interest in any of
the capital stock or other securities or of its Subsidiary, except to Lender.

             (l)      The
Borrower shall not outside the ordinary course of business, and shall not permit
the Bank’s Subsidiary to, pledge any assets to any other Person
without the prior written consent of the Lender.

             (m)    The
Borrower and Subsidiary must not be in a situation requiring a material formal
enforcement action by its Regulators as it relates to the financial condition
of the Borrower and/or the Subsidiary.

     5.     Advances Under the Loan. The Lender shall not be obligated to make any advance of the Loan to the Borrower unless in each instance, at the time of each
advance:

             (a)      All representations and warranties of the Borrower contained in this Agreement or the Note shall be true in all material respects on and as of the date of each
advance of the Loan.

             (b)     The
Borrower and each Subsidiary shall have performed in all material respects all
their agreements and obligations required by the Financing
Documents.

             (c)     No
material adverse change shall have occurred in the Borrower's or any Subsidiary's
condition (financial or otherwise), or in the business, properties, assets,
liabilities, prospects, or management of the Borrower or any Subsidiary since
the date of this Agreement.

             (d)     No
Default or event which, with the giving of notice or passage of time (or both),
would constitute a Default under the terms of this Agreement shall have
occurred.

             (e)     All
other matters incidental to the Loan shall be satisfactory to the Lender.

     6.     Default. A "Default" shall
exist if any of the following occurs:

             (a)     Failure
of the Borrower
punctually to make any payment of any amount payable, whether principal or interest
or other amount, on any of the Liabilities, whether at maturity, or at a date
fixed for any prepayment or partial prepayment, or by acceleration, or  otherwise,
subject to applicable grace or cure periods.

             (b)     Any
statement, representation, or warranty of the Borrower made in any of the Financing
Documents or at any time furnished by or on behalf of the Borrower to  the Lender
shall be false or misleading in any material respect as of the date made.

             (c)     Failure
of the Borrower punctually and fully to comply with (i) any of the covenants
in Section 4 of this Agreement or (ii) any of the other covenants set forth
in this Agreement if such failure under this clause (ii) is not remedied within
thirty (30) days after notice from the Lender to the Borrower.

             (d)     The
occurrence of a default under any other agreement to which the Borrower and the
Lender are parties or under any other instrument executed by the Borrower in

favor of the Lender.

             (e)     If
the Borrower or any Subsidiary becomes insolvent as defined in the Georgia Uniform
Commercial Code or makes an assignment for the benefit of creditors; or if  any
action is brought by the Borrower or any Subsidiary seeking dissolution of the
Borrower or such Subsidiary or liquidation of its assets or seeking the appointment
of a trustee, interim trustee, receiver, or other custodian for any of its
property; or if the Borrower or any Subsidiary commences a voluntary case under
the Federal Bankruptcy Code; or if any reorganization or arrangement proceeding
is instituted by the Borrower or any Subsidiary for the settlement, readjustment,
 composition or extension of any of its debts upon any terms; or if any action
or petition is otherwise brought by the Borrower or any Subsidiary seeking similar
relief or alleging that it is insolvent or unable to pay its debts as they
mature.

5

             (f)     Any
action is brought against the Borrower or any Subsidiary seeking dissolution
of the Borrower or such Subsidiary or liquidation of any of its assets or  seeking
the appointment of a trustee, interim trustee, receiver, or other custodian for
any of its property, and such action is consented to or acquiesced in by the
Borrower or such Subsidiary or is not dismissed within ninety (90) days of the
date
upon which it was instituted; or any proceeding under the Federal Bankruptcy
Code is instituted against the Borrower or any Subsidiary and (i) an order for
relief is entered in such proceeding or (ii) such proceeding is consented to
or acquiesced in  by the Borrower or such Subsidiary or is not dismissed within
ninety (90) days of the date upon which it was instituted; or any reorganization
or arrangement proceeding is instituted against the Borrower or any Subsidiary
for the settlement,
readjustment, composition, or extension of any of its debts upon any terms, and
such proceeding is consented to or acquiesced in by the Borrower or such Subsidiary
or is not dismissed within ninety (90) days of the date upon which it was instituted;
 or any action or petition is otherwise brought against the Borrower or any Subsidiary
seeking similar relief or alleging that it is insolvent, unable to pay its debts
as they mature, or generally not paying its debts as they become due, and such

action or petition is consented to or acquiesced in by the Borrower or such Subsidiary
or is not dismissed within ninety (90) days of the date upon which it was brought.

             (g)     The
Borrower or any Subsidiary is in default (or an event has occurred which, with
the giving of notice or passage of time, or both, will cause the Borrower or
 any Subsidiary to be in default) on indebtedness to another Person, and the
amount of such indebtedness exceeds Twenty Five Thousand and 00/100 Dollars ($25,000.00)
or the acceleration of the maturity of such indebtedness would have a material

adverse effect upon the Borrower or such Subsidiary.

             (h)     Any
other material adverse change occurs in the Borrower's financial condition or
means or ability to pay the Liabilities.

             (i)      Any
cease and desist or other order has been threatened, noticed, or entered against
the Borrower or any Subsidiary by any bank or bank holding company  regulatory
agency or body, or the Borrower or any Subsidiary enters into any form of memorandum
of understanding, plan of corrective action, or letter agreement with any such
regulatory agency or body, or any other regulatory enforcement action is
taken against the Borrower or any Subsidiary relating to the capitalization,
management, or operation of the Borrower or any Subsidiary.

             (j)     The
Borrower or any Subsidiary is indicted or convicted or pleads guilty or nolo
contendere
or regulatory
enforcement actions are initiated regarding any charge that the Borrower or such
Subsidiary has violated any drug, controlled substances, money laundering, currency
 reporting, racketeering, or racketeering-influenced-and-corrupt-organization
statute or regulations other forfeiture statute.

             (k)     The
Borrower ceases to own one hundred percent (100%) of the issued and outstanding
capital stock of the Bank.

             (l)     The
Borrower or Subsidiary are placed under any regulatory enforcement action.

     7.     Remedies Upon Default. Upon the occurrence of a Default, the Lender shall be entitled, without limitation, to exercise the following rights at any time and
from time to time, which the Borrower hereby agrees to be commercially reasonable, provided however, Borrower shall have thirty (30) days to cure said Default upon written notice:

             (a)     declare
any of the Liabilities due and payable, whereupon they immediately will become
due and payable (notwithstanding any provisions to the contrary, and  without
presentment, demand, notice or protest of any kind (all of which are expressly
waived by the Borrower));

             (b)     (i) receive all amounts payable in respect of the Collateral otherwise payable to the Borrower; (ii) settle all accounts, claims, and controversies relating to
the Collateral; (iii) transfer all or any part of the Collateral into the Lender's or any nominee's name; and (iv) execute all agreements and other instruments; bring, defend and abandon all actions and other proceedings; and take all actions in
relation to the Collateral as the Lender in its sole discretion may determine;

6

             (c)     enforce
the payment of the Stock and exercise all of the rights, powers and remedies
of the Borrower thereunder, including the exercise of all voting rights and
other ownership or consensual rights of the Stock (but the Lender is not hereby
obligated to exercise such rights), and in connection therewith the Borrower
hereby appoints the Lender to be the Borrower's true and lawful attorney-in-fact
and
IRREVOCABLE PROXY to vote the Stock in any manner the Lender deems advisable
for or against all matters submitted to a vote of shareholders, and such power-of-attorney
is coupled with an interest and irrevocable;

             (d)     sell,
assign and deliver, or grant options to purchase, all or any part of or interest
in the Collateral in one or more parcels, at any public or private sale  at any
exchange, any of the Lender's offices, or elsewhere, without demand of performance,
advertisement, or notice of intention to sell or of the time or place of sale
or adjournment thereof or to redeem or otherwise (all of which are hereby
expressly and irrevocably waived by the Borrower), for cash, on credit, or for
other property, for immediate or future delivery without any assumption of credit
risk, and for such price and on such terms as the Lender in its sole discretion
may  determine; the Borrower agrees that to the extent that notice of sale shall
be required by law that at least five (5) business days' notice to the Borrower
of the time and place of any public sale or the time after which any private
sale is to be
made shall constitute reasonable notification; the Lender shall not be obligated
to make any sale of Collateral regardless of notice of sale having been given;
the Lender may adjourn any public or private sale from time to time by announcement
at  the time and place fixed therefor, and any such sale may, without further
notice, be made at the time and place to which it was so adjourned; the Borrower
hereby waives and releases to the fullest extent permitted by law any right or
equity of
redemption with respect to the Collateral, whether before or after sale hereunder,
and all rights, if any, of marshalling the Collateral and any other security
for the Loan or otherwise; at any such sale, unless prohibited by applicable
law, the  Lender may bid for and purchase all or any part of the Collateral so
sold free from any such right or equity of redemption; and the Lender shall not
be liable for failure to collect or realize upon any or all of the Collateral
or for any delay in so
doing nor shall any of them be under any obligation to take any action whatsoever
with regard thereto;

             (e)     appoint
and dismiss managers or other agents for any of the purposes mentioned in the
foregoing provisions of this Section 7, all as the Lender in its sole  discretion
may determine; and

             (f)     generally,
take all such other action as the Lender in its sole discretion may determine
as incidental or conducive to any of the matters or powers mentioned in  this
Section 7 and which the Lender may or can do lawfully and use the name of the
Borrower for such purposes and in any proceedings arising therefrom.

     8.     Application of Proceeds. The proceeds of the public or private sale or other disposition of any Collateral hereunder shall be applied to (i) the costs incurred in connection with the sale, expressly including, without limitation,
any costs under Section 11(a) hereof; (ii) any unpaid interest which may have accrued on any obligations secured hereby; (iii) any unpaid principal on any obligations secured hereby; and (iv) damages incurred by the Lender by reason of any breach
secured against hereby, in such order as the Lender may determine, and any remaining proceeds shall be paid over to the Borrower or others as by law provided. If the proceeds of the sale or other disposition of the Stock are insufficient to pay all
such amounts, the Borrower shall remain liable to the Lender for the deficiency.

     9.     Additional Rights of Secured Parties. In addition to its other rights and privileges under this Agreement, the Lender may exercise from time to time any and all other
rights and remedies available to a secured party when a debtor is in default under a security agreement as provided in the Uniform Commercial Code of Georgia, or available to the Lender under any other applicable law or in equity, including without
limitation the right to any deficiency remaining after disposition of the Collateral. The Borrower shall pay all of the reasonable costs and expenses (including reasonable attorneys' fees) incurred by the Lender in enforcing its rights under this
Agreement.

     10.    Return of Stock to Borrower. Upon payment in full of all principal and interest on the Note, the Lender shall return to the Borrower (i) all of the then remaining
Stock and (ii) all rights received by the Lender as agent for the Borrower as a result of its possessory interest in the Stock.

     11.    Disposition of Stock by Agent. The Stock is not registered under the various federal or state securities laws and disposition thereof after default may be subject to
prior

7

regulatory approval and may be restricted to one or more private (instead of public) sales in view of the lack of such registration. The Borrower acknowledges that upon such disposition, the
Lender may approach only a restricted number of potential purchasers and that a sale under such circumstances may yield a lower price for the Stock than if the Stock were registered pursuant to federal and state securities laws and sold on the open
market. The Borrower, therefore, agrees that:

             (a)     if
the Lender shall, pursuant to the terms of this Agreement, sell or cause any
of the Stock to be sold at a private sale, the Lender shall have the right to
 rely upon the advice and opinion of any national brokerage or investment firm
having recognized expertise and experience in connection with shares of companies
in the banking industry (but shall not be obligated to seek such advice and the
failure
to do so shall not be considered in determining the commercial reasonableness
of the Lender's action) as to the best manner in which to expose the Stock for
sale and as to the best price reasonably obtainable at the private sale thereof;

and

             (b)     such
reliance shall be conclusive evidence that the Lender has handled such disposition
in a commercially reasonable manner.

     12.    Borrower's Obligations Absolute. The obligations of the Borrower under this Agreement shall be direct and immediate and not conditional or contingent upon the pursuit
of any other remedies against the Borrower or any other Person, nor against other security or liens available to the Lender or its successors, assigns or agents. The Borrower hereby waives any right to require that an action be brought against any
other Person or require that resort be had to any security or to any balance of any deposit account or credit on the books of the Lender in favor of any other Person prior to any exercise of rights or remedies hereunder, or to require resort to
rights or remedies of the Lender in connection with the Loan.

     13.    Notices. Except as provided otherwise in this Agreement, all notices and other communications under this Agreement are to be in writing and are
to be deemed to have been duly given and to be effective upon receipt by the party to whom they are directed. If sent by U.S. mail, first class, certified, return receipt requested, postage prepaid, and addressed to the Lender or to the Borrower at
their respective addressees set forth below, such communications are deemed to have been delivered upon receipt.

	 
	If to the
    Lender:	SILVERTON
        BANK, N.A.

      3284 Northside Parkway

      Atlanta, Georgia
      30327

      Attn: Jeffrey S.
    Neale, Senior Vice President
	 	 	 
	 	If to the
    Borrower:	1ST UNITED
        BANCORP, INC.,

      a Florida corporation
      (Borrower)

      One North Federal
      Hwy.

      Boca Raton, Florida
      33432

      Attn: John Marino,
    President

     Either the Lender or the Borrower may, by written notice to the other, designate a different address for receiving notices under this Agreement; provided, however,
that no such change of address will be effective until written notice thereof is actually received by the party to whom such change of address is sent.

     14.    Binding Agreement. The provisions of this Agreement shall be construed and interpreted, and all rights and obligations of the parties hereto determined,
in accordance with the laws of the State of Georgia. This Agreement, together with all documents referred to herein, constitutes the entire Agreement between the Borrower and the Lender with respect to the matters addressed herein and may not be
modified except by a writing executed by the Lender and delivered by the Lender to the Borrower. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original but all of which, taken together, shall constitute
one and the same instrument.

     15.    Participations. The Lender may at any time grant participations in or sell, assign, transfer or otherwise dispose of all or any portion of the
indebtedness of the Borrower outstanding pursuant to the Financing Documents. The Borrower hereby agrees that any holder of a participation in, and any assignee or transferee of, all or any portion of any amount owed by the

8

Borrower under the Financing Documents (i) shall be entitled to the benefits of the provisions of this Agreement as the Lender hereunder and (ii) may exercise any and all rights of the banker's
lien, set-off or counterclaim with respect to any and all amounts owed by the Borrower to such assignee, transferee or holder as fully as if such assignee, transferee or holder had made the Loan in the amount of the obligation in which it holds a
participation or which is assigned or transferred to it. Notwithstanding the foregoing, in the event Lender decides to participate the Loan, Lender shall only participate with non-Florida lenders.

     16.    Loan Fee/Expenses. Borrower shall pay to Lender a Loan Fee in the annual amount of one-eighth of one percent (1/8%) which will be assessed quarterly on a
per-annum basis based on the average unused portion of the Loan. Additionally, all reports and other documents or information furnished to the Lender under this Agreement shall be supplied by the Borrower without cost to the Lender. Further, the
Borrower shall reimburse the Lender on demand for all reasonable out-of-pocket costs and expenses (including legal fees) incurred by the Lender in connection with the preparation, interpretation, operation, and enforcement of the Financing Documents
or the protection or preservation of any right or claim of the Lender with respect to such agreements. The Borrower will pay all taxes (if any) in connection with the Financing Documents. The obligations of the Borrower under this section shall
survive the payment of the Liabilities and the termination of this Agreement.

     17.    Indemnification. In addition to any other amounts payable by the Borrower under this Agreement, the Borrower shall pay and indemnify the Lender from
and against all claims, liabilities, losses, costs, and expenses (including, without limitation, reasonable attorneys' fees and expenses) which the Lender may (other than as a result of the gross negligence or willful misconduct of the Lender) incur
or be subject to as a consequence, directly or indirectly, of (i) any breach by the Borrower of any warranty, term or condition in, or the occurrence of any default under, any of the Financing Documents, including all fees or expenses resulting from
the settlement or defense of any claims or liabilities arising as a result of any such breach or default, (ii) the Lender's making, holding, or administering the Loan or the Collateral, (iii) allegations of participation or interference by the
Lender in the management, contractual relations or other affairs of the Borrower or any Subsidiary, (iv) allegations that the Lender has joint liability with the Borrower or any Subsidiary for any reason, and (v) any suit, investigation, or
proceeding as to which the Lender or such participant is involved as a consequence, directly or indirectly, of its execution of any of the Financing Documents, or any other event or transaction contemplated by any of the foregoing. The obligations
of Borrower under this Section 17 shall survive the termination of this Agreement.

     18.    Right to Set-Off. Upon the occurrence of a Default hereunder, the Lender, without notice or demand of any kind, may hold and set off against such of the
Liabilities (whether matured or unmatured) as the Lender may elect any balance or amount to the credit of the Borrower in any deposit, agency, reserve, holdback or other account of any nature whatsoever maintained by or on behalf of the Borrower
with the Lender at any of its offices, regardless of whether such accounts are general or special and regardless of whether such accounts are individual or joint. Any Person purchasing an interest in debt obligations under this Agreement held by the
Lender may exercise all rights of offset with respect to such interest as fully as if such Person were a holder of debt obligations hereunder in the amount of such interest.

     19.    Further Assurances. If at any time the Lender upon advice of its counsel shall determine that any further document shall be required to effect this
Agreement and the transactions and other agreements contemplated thereby, the Borrower shall, and shall cause its Subsidiary to, execute and deliver such document and otherwise carry out the purposes of this Agreement.

     20.    Severability. If any paragraph or part thereof shall for any reason be held or adjudged to be invalid, illegal, or unenforceable by any court of
competent jurisdiction, such paragraph or part thereof shall be deemed separate, distinct, and independent, and the remainder of this Agreement shall remain in full force and effect and shall not be affected by such holding or
adjudication.

     21.    Binding Effect. All rights of the Lender under the Financing Documents shall inure to the benefit of its transferees, successors and assigns. All
obligations of the Borrower under the Financing Documents shall bind its heirs, legal representatives, successors, and assigns.

9

     22.    Definitions.

             (a)     "Bank
    Subsidiary" means
  each banking Subsidiary of Borrower, now or hereafter in existence, including
  but not limited to the Bank.

             (b)     "Capital" means all capital or all components of capital, other than any allowance for loan and lease losses and net of any intangible assets, as defined from
time to time by the primary federal regulator of the Borrower, the Bank, or the Subsidiary (as the case may be).

             (c)     "Collateral" means and includes all property assigned or pledged to the Lender or in which the Lender has been granted security interest or to which the Lender
has been granted security title, whether under any of the Financing Documents or any other agreement, instrument, or document, and the proceeds thereof.

             (d)     “Debt Service Coverage” shall be calculated as the maximum dividend that may be paid by Bank to Borrower divided by the interest expense of the Loan.
The maximum dividend is that which is permissible under any applicable federal regulatory constraints, and which also allows Borrower’s Subsidiary/Bank to maintain Tier 1 Capital Leverage and Tier 1 Risk Based Capital ratings of “Well
Capitalized” (as defined by federal regulators).

             (e)     "Financing Documents" means and includes this Agreement, the Note, and all other associated loan and collateral documents including, without limitation, all
guaranties, suretyship agreements, stock powers, security agreements, security deeds, subordination agreements, exhibits, schedules, attachments, financing statements, notices, consents, waivers, opinions, letters, reports, records, assignments,
documents, instruments, information and other writings related thereto, or furnished by the Borrower to the Lender in connection therewith or in connection with any of the Collateral, and any amendments, extensions, renewals, modifications or
substitutions thereof or therefor.

             (f)     "Liabilities" means all indebtedness, liabilities, and obligations of the Borrower of any nature whatsoever which the Lender may now or hereafter have, own or
hold, and which are now or hereafter owing to the Lender regardless of however and whenever created, arising or evidenced, whether now, heretofore or hereafter incurred, whether now, heretofore or hereafter due and payable, whether alone or together
with another or others, whether direct or indirect, primary or secondary, absolute or contingent, or joint or several, and whether as principal, maker, endorser, guarantor, surety or otherwise, and also regardless of whether such Liabilities are
from time to time reduced and thereafter increased or entirely extinguished and thereafter reincurred, including without limitation the Note and any amendments, extensions, renewals, modifications or substitutions thereof or therefor.

             (g)     "Note" shall mean that certain Promissory Note With Revolving Feature dated as of July, 2 2008 in the maximum principal amount of Five Million and 00/100
Dollars ($5,000,000.00) and any amendments, extensions, renewals, modifications, or substitutions thereof or therefor in effect at any particular time.

             (h)     "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or
any agency or political subdivision thereof.

             (i)     "Subsidiary" means the Bank Subsidiary and each other corporation for which the Borrower has the power, directly or indirectly, to direct its management or
policies or to vote 25% or more of any class of its voting securities.

             (j)     "Tier 1 Risk Based Capital" means Tier 1 Risk Based Capital as defined by the capital maintenance regulations of the primary federal bank regulatory
agency.

             (k)     "Tier 1 Capital Leverage" means the Tier 1 Capital Leverage as defined by the capital maintenance regulations of the primary federal bank regulatory
agency.

             (l)     All
accounting terms not otherwise defined herein have the meanings assigned to them
in accordance with generally accepted accounting principles in effect from  time
to time.

10

     IN WITNESS WHEREOF, the undersigned have hereunto set their hands and affixed their seals by and through their duly authorized officers, as of the day and year
first above written.

	 	BORROWER:	 
	 	 	 
	 	1ST UNITED
        BANCORP, INC., a Florida corporation	 
	 	 	 	 
	 	 	 	 
	 	By: 	/s/ John Marino	 
	 	 	John Marino, President	 
	 	 	 	 
	 	 	[CORPORATE SEAL]	 

	
Witness:  /s/ Karen Chandler              

Name:     Karen Chandler

Witness:  /s/
Patricia A. Labelle          

Name:     Patricia A. Labelle

I hereby certify that the representation and warranty contained in Section 2(i)(v) of this Agreement is true and correct.

	 	By:	/s/ John Marino	 
	 	NAME: 	John Marino	 
	 	TITLE:	CFO	 
	 	 	 	 

(Signatures continue on following page)

11

	 	LENDER:	 
	 	 	 
	 	SILVERTON
    BANK, N.A.	 
	 	 	 	 
	 	 	 	 
	 	BY:	/s/ Jeffrey S. Neale	 
	 	 	Jeffrey S. Neale,
    Senior Vice President	 
	 	 	 	 

	
Witness: _________________

Name:

Witness: _________________

Name:

12

EXHIBIT A

ARTICLES OF INCORPORATION 

  OF

1ST UNITED BANCORP, INC., a
Florida corporation

13

EXHIBIT B

CERTIFICATE OF GOOD STANDING 

OF

1ST UNITED
      BANCORP, INC., a Florida corporation

14

EXHIBIT C

BYLAWS 

OF

1ST UNITED BANCORP, INC., a
Florida corporation

15

EXHIBIT D

RESOLUTIONS 

OF

1ST UNITED BANCORP, INC., a
Florida corporation

16

EXHIBIT E

ARTICLES OF INCORPORATION 

OF

1ST UNITED BANK, A FLORIDA
BANKING CORPORATION

17

EXHIBIT F

CERTIFICATE OF CORPORATE EXISTENCE 

OF

1ST UNITED BANK, A FLORIDA
BANKING CORPORATION

18

	 
	
EXHIBIT G
        
	 
	
BYLAWS
        
	
OF
        
	
1ST UNITED BANK, A FLORIDA
BANKING CORPORATION 
        

19

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