Document:

ex10-1.htm

    
      
        

      
Exhibit 10.1

     

    
      	
              Execution
      Version

            

    

     

    
      

      

    

    
      SUBORDINATED
TERM LOAN AGREEMENT

      

      

      dated as
of August 29, 2008

      

      

      among

      

      

      UNITED
COMMUNITY BANK

      as
Borrower

      

      

      THE
LENDERS FROM TIME TO TIME PARTY HERETO

      

      

      and

      

      

      SUNTRUST
BANK

      as
Administrative Agent

      

      
        

      

      

      
        

        

      

      

      

      SUNTRUST
ROBINSON HUMPHREY, INC.

      as Lead
Arranger and Sole Bookrunner

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          	 
      	 
      	 
      	 
	 
      TABLE
      OF CONTENTS
	 
      	 
      	 
      	 
	
                  ARTICLE I.    
      DEFINITIONS; CONSTRUCTION

                	
                  1

                	 
	
                  Section
      1.1.

                	
                  Definitions.

                	
                  1

                	 
	
                  Section
      1.2.

                	
                  Terms
      Generally

                	
                  9

                	 
	
                  ARTICLE II.    
      AMOUNT AND TERMS OF THE SUBORDINATED TERM LOAN

                	
                  10

                	 
	
                  Section
      2.1.

                	
                  Term
      Loan Commitment

                	
                  10

                	 
	
                  Section
      2.2.

                	
                  Procedure
      for Borrowing Term Loans

                	
                  10

                	
                   

                
	
                  Section
      2.3.

                	
                  Funding
      of Borrowings

                	
                  10

                	
                   

                
	
                  Section
      2.4.

                	
                  Termination
      of Commitments

                	
                  11

                	 
	
                  Section
      2.5.

                	
                  Repayment
      and Prepayments of Loans

                	
                  11

                	 
	
                  Section
      2.6.

                	
                  Interest
      on Loans

                	
                  11

                	 
	
                  Section
      2.7.

                	
                  Certain
      Fees.

                	
                  12

                	 
	
                  Section
      2.8.

                	
                  Computation
      of Interest and Fees

                	
                  12

                	 
	
                  Section
      2.9.

                	
                  Inability
      to Determine Interest Rates

                	
                  12

                	 
	
                  Section
      2.10.

                	
                  Evidence
      of Indebtedness

                	
                  13

                	 
	
                  Section
      2.11.

                	
                  Illegality

                	
                  13

                	 
	
                  Section
      2.12.

                	
                  Increased
      Costs.

                	
                  13

                	 
	
                  Section
      2.13.

                	
                  Funding
      Indemnity

                	
                  15

                	 
	
                  Section
      2.14.

                	
                  Taxes

                	
                  15

                	 
	
                  Section
      2.15.

                	
                  Payments
      Generally; Pro Rata Treatment

                	
                  17

                	 
	
                  Section
      2.16.

                	
                  Mitigation
      of Obligations; Replacement of Lenders

                	
                  18

                	 
	
                  Section
      2.17.

                	
                  Subordinated
      and Unsecured Obligations

                	
                  19

                	 
	
                  Section
      2.18.

                	
                  Incremental
      Facility.

                	
                  19

                	 
	
                  ARTICLE III.    
      CONDITIONS TO EFFECTIVENESS AND MAKING OF LOANS

                	
                  21

                	
                   

                
	
                  Section
      3.1.

                	
                  Conditions
      To Effectiveness

                	
                  21

                	 
	
                  Section
      3.2.

                	
                  Each
      Loan

                	
                  22

                	 
	
                  ARTICLE IV.    
      REPRESENTATIONS AND WARRANTIES

                	
                  23

                	 
	
                  Section
      4.1.

                	
                  Existence;
      Power

                	
                  23

                	 
	
                  Section
      4.2.

                	
                  Organizational
      Power; Authorization

                	
                  23

                	 
	
                  Section
      4.3.

                	
                  Governmental
      Approvals; No Conflicts

                	
                  23

                	 
	
                  Section
      4.4.

                	
                  Financial
      Statements

                	
                  24

                	 
	
                  Section
      4.5.

                	
                  Litigation
      Matters and Enforcement Actions

                	
                  24

                	 
	
                  Section
      4.6.

                	
                  Compliance
      with Laws and Agreements

                	
                  25

                	 
	
                  Section
      4.7.

                	
                  Investment
      Company Act

                	
                  25

                	 
	
                  Section
      4.8.

                	
                  Taxes

                	
                  25

                	 
	
                  Section
      4.9.

                	
                  Margin
      Regulations

                	
                  25

                	 
	
                  Section
      4.10.

                	
                  Disclosure

                	
                  26

                	 
	
                  Section
      4.11.

                	
                  Dividend
      Restrictions; Other Restrictions.

                	
                  26

                	 
	
                  Section
      4.12.

                	
                  Capital
      Measures

                	
                  26

                	 
	
                  Section
      4.13.

                	
                  FDIC
      Insurance

                	
                  26

                	 
	
                  Section
      4.14.

                	
                  Ownership
      of Property

                	
                  26

                	 
	
                  Section
      4.15.

                	
                  OFAC

                	
                  27

                	 
	
                  Section
      4.16.

                	
                  Patriot
      Act

                	
                  27

                	
                   

                
	
                  Section
      4.17.

                	
                  Solvency

                	
                  27

                	 
	
                  ARTICLE V.    
      COVENANTS

                	
                  28

                	 
	
                  Section
      5.1.

                	
                  Financial
      Statements and Other Information

                	
                  28

                	 
	
                  Section
      5.2.

                	
                  Notices
      of Material Events

                	
                  30

                	 
	
                  Section
      5.3.

                	
                  Existence;
      Conduct of Business

                	
                  30

                	 

        

        
           

          
            
              
              

            

            
              - i
-

              
                

              

            

            
              
              

            

          

        

         

        
          	
                  Section
      5.4.

                	
                  Compliance
      with Laws, Etc.

                	
                  31

                	 
	
                  Section
      5.5.

                	
                  Payment
      of Obligations

                	
                  31

                	 

        

      

      
        
          	 
      	 
      	 
      	 
	
                  Section
      5.6.

                	
                  Books
      and Records

                	
                  31

                	 
	
                  Section
      5.7.

                	
                  Visitation,
      Inspection, Etc

                	
                  31

                	 
	
                  Section
      5.8.

                	
                  Maintenance
      of Properties; Insurance

                	
                  31

                	 
	
                  Section
      5.9.

                	
                  Use
      of Proceeds

                	
                  32

                	 
	
                  Section
      5.10.

                	
                  Subordination
      of Loans

                	
                  32

                	 
	
                  ARTICLE VI.    
      EVENTS OF DEFAULT

                	
                  32

                	 
	
                  Section
      6.1.

                	
                  Events
      of Default

                	
                  32

                	 
	
                  ARTICLE VII.    
      THE ADMINISTRATIVE AGENT

                	
                  33

                	 
	
                  Section
      7.1.

                	
                  Appointment
      of Administrative Agent

                	
                  33

                	 
	
                  Section
      7.2.

                	
                  Nature
      of Duties of Administrative Agent

                	
                  33

                	 
	
                  Section
      7.3.

                	
                  Lack
      of Reliance on the Administrative Agent

                	
                  34

                	 
	
                  Section
      7.4.

                	
                  Certain
      Rights of the Administrative Agent

                	
                  34

                	 
	
                  Section
      7.5.

                	
                  Reliance
      by Administrative Agent

                	
                  35

                	 
	
                  Section
      7.6.

                	
                  The
      Administrative Agent in its Individual Capacity

                	
                  35

                	 
	
                  Section
      7.7.

                	
                  Successor
      Administrative Agent

                	
                  35

                	 
	
                  ARTICLE VIII.    
      MISCELLANEOUS

                	
                  36

                	 
	
                  Section
      8.1.

                	
                  Notices.

                	
                  36

                	 
	
                  Section
      8.2.

                	
                  Waiver;
      Amendments.

                	
                  37

                	 
	
                  Section
      8.3.

                	
                  Expenses;
      Indemnification

                	
                  38

                	 
	
                  Section
      8.4.

                	
                  Successors
      and Assigns.

                	
                  39

                	 
	
                  Section
      8.5.

                	
                  Governing
      Law; Jurisdiction; Consent to Service of Process

                	
                  41

                	 
	
                  Section
      8.6.

                	
                  WAIVER
      OF JURY TRIAL

                	
                  42

                	 
	
                  Section
      8.7.

                	
                  Counterparts;
      Integration

                	
                  42

                	 
	
                  Section
      8.8.

                	
                  Survival

                	
                  42

                	 
	
                  Section
      8.9.

                	
                  Severability

                	
                  43

                	 
	
                  Section
      8.10.

                	
                  Confidentiality

                	
                  43

                	 
	
                  Section
      8.11.

                	
                  Interest
      Rate Limitation

                	
                  43

                	 
	
                  Section
      8.12.

                	
                  Waiver
      of Effect of Corporate Seal

                	
                  44

                	 
	
                  Section
      8.13.

                	
                  Patriot
      Act

                	
                  44

                	 
	
                  Section
      8.14.

                	
                  Bookrunner
      and Lead Arranger

                	
                  44

                	 
	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
	
                  Schedules

                	 
      	 
      	 
	 
      	 
      	 
      	 
	
                  Schedule
      I

                	
                  -
      Commitment Amounts

                	 
      	 
	 
      	 
      	 
      	 
	
                  Exhibits

                	 
      	 
      	 
	 
      	  
      	 
      	 
	
                  Exhibit
      A

                	
                  -Form
      of Subordinated Term Note

                	 
      	 
	
                  Exhibit
      3.1(b)(iii)

                	-Form
      of Secretary’s Certificate	 	 
	
                  Exhibit
      3.1(b)(v) 

                	-Form
      of Opinion	 	 
	
                  Exhibit
      3.1(b)(vi)

                	-Form
      of Officer’s Certificate	 	 
	 
      	 
      	 
      	 

        

         

      

      
        
          
          

        

        
          - ii
-

          
            

          

        

        
          
          

        

      

       

      SUBORDINATED TERM LOAN
AGREEMENT

      

      

      THIS SUBORDINATED TERM LOAN
AGREEMENT (this “Agreement”) is made and entered into
as of August 29, 2008, by and among UNITED COMMUNITY BANK, a Georgia state bank
(the “Borrower”), the
several banks and other financial institutions from time to time party hereto
(the “Lenders”), and
SUNTRUST BANK, in its capacity as Administrative Agent for the Lenders (the
“Administrative
Agent”).

      

      W I T N E S S E T
H:

      

      WHEREAS, the Borrower has
requested the Lenders, and the Lenders have agreed, subject to the terms and
conditions of this Agreement, to make subordinated term loans in an aggregate
principal amount of $30,000,000 that are intended to qualify as Tier 2
Capital;

      

      NOW, THEREFORE, in
consideration of the premises and the mutual covenants herein contained, the
Borrower, the Administrative Agent and the Lenders agree as
follows:

      

      ARTICLE I.
DEFINITIONS;
CONSTRUCTION

      

      Section 1.1.
Definitions.

      In
addition to the other terms defined herein, the following terms used herein
shall have the meanings herein specified (to be equally applicable to both the
singular and plural forms of the terms defined):

      

      “Administrative
Agent” shall have the meaning assigned to such term in the opening
paragraph hereof.

      

      “Administrative
Questionnaire” shall mean, with respect to each Lender, an administrative
questionnaire in the form prepared by the Administrative Agent and submitted to
the Administrative Agent duly completed by such Lender.

      

      “Aggregate
Commitments” shall mean the sum of the Commitments of all Lenders at any
time outstanding.  On the Closing Date, the Aggregate Commitments
shall equal $30,000,000.

      

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

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      “Base Rate
Loan” shall mean any Loan accruing interest at the Base
Rate.

      

      “Base Rate
Margin” shall mean 2.50% per annum.

      

      “Borrowing” shall mean a borrowing
consisting of Loans of the same Type, made on the same date.

      

      “Business
Day” shall mean (i) any day other than a Saturday, Sunday or other
day on which commercial banks in Atlanta, Georgia are authorized or required by
law to close and (ii) if such day relates to a Borrowing, a payment or
prepayment of principal or interest on a Eurodollar Loan or a notice with
respect thereto, any day on which dealings in Dollars are carried on in the
London interbank market.

      

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

      

      “Change in
Law” shall mean (i) the adoption of any applicable law, rule or
regulation after the date of this Agreement, (ii) any change in any
applicable law, rule or regulation, or any change in the interpretation or
application thereof, by any Governmental Authority after the date of this
Agreement, or (iii) compliance by any Lender (or for purposes of Section 2.12(b),
by such Lender’s holding company, if applicable) with any request, guideline or
directive (whether or not having the force of law) of any Governmental Authority
made or issued after the date of this Agreement.

      

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

      

      “Commitment”
shall mean, with respect to each Lender, the obligation of such Lender to make a
Term Loan hereunder on the Closing Date, in a principal amount not exceeding the
amount set forth with respect to such Lender on Schedule I.

      

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

      

      “Environmental
Laws” shall mean all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by or with any Governmental Authority, relating in
any way to the environment, preservation or reclamation of natural resources,
the management, Release or threatened Release of any Hazardous Material or to
health and safety matters.

      

      
        
          
          

        

        
          - 2
-

          
            

          

        

        
          
          

        

         

      

      “Environmental
Liability” shall mean any liability, contingent or otherwise (including
any liability for damages, costs of environmental investigation and remediation,
costs of administrative oversight, fines, natural resource damages, penalties or
indemnities), of the Borrower or any Subsidiary directly or indirectly resulting
from or based upon (a) any actual or alleged violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment
or disposal of any Hazardous Materials, (c) any actual or alleged exposure
to any Hazardous Materials, (d) the Release or threatened Release of any
Hazardous Materials or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with respect to
any of the foregoing.

      

      “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended from
time to time, and any successor statute.

      

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

      

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

      

      “Eurodollar”
when used in reference to any Loan or any Borrowing, refers to whether such Loan
or such Borrowing bears interest at a rate determined by reference to
LIBOR.

      

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

       

      
        
          
          

        

        
          - 3
-

          
            

          

        

        
          
          

        

      

       

      “Excluded
Taxes” shall mean with respect to the Administrative Agent, any Lender or
any other recipient of any payment to be made by or on account of any obligation
of the Borrower hereunder, (a) income or franchise taxes imposed on (or
measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed
by the United States of America or any similar tax imposed by any other
jurisdiction in which any Lender is located and (c) in the case of a
Foreign Lender, any withholding tax that (i) is imposed on amounts payable
to such Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement (or designates a new lending office), (ii) is imposed on amounts
payable to such Foreign Lender at any time that such Foreign Lender designates a
new lending office, other than taxes that have accrued prior to the designation
of such lending office that are otherwise not Excluded Taxes, and (iii)  is
attributable to such Foreign Lender’s failure to comply with Section 2.14(e).

      

      “FDIC”
shall mean the Federal Deposit Insurance Corporation.

      

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

      

      “Fee
Letter” shall have the meaning assigned to such term in Section 2.7.

      

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

      

      “Foreign
Lender” shall mean any Lender that is not a United States person under
Section 7701(a)(3) of the Code.

      

      “FRB” shall
mean the Board of Governors of the Federal Reserve System.

      

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

       

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

       

      
        
          
          

        

        
          - 4
-

          
            

          

        

        
          
          

        

      

       

      “GAAP”
shall mean generally accepted accounting principles in the United States applied
on a consistent basis.

      

      “Governmental
Authority” shall mean the government of the United States of America, any
other nation or any political subdivision thereof, whether state or local, and
any agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government, including
without limitation, the FRB, the FDIC, the Georgia Department of Banking and
Finance and any other federal or state agency charged with the supervision or
regulation of depositary institutions or holding companies of depositary
institutions (as used herein, including any trust company subsidiaries whether
or not they take deposits), or engaged in the insurance of depositary
institution deposits, or any court, administrative agency or commission or other
governmental agency, authority or instrumentality having supervisory or
regulatory authority with respect to the Borrower and/or any of its
Subsidiaries.

      

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

      

      “Incremental
Commitment” shall have the meaning assigned to such term in Section 2.18(a).

      

      “Incremental
Commitments Effective Date” shall have the meaning assigned to such term
in Section 2.18(d).

      

      “Incremental
Facility Amendment” shall have the meaning assigned to such term in Section 2.18(c).

      

      “Incremental
Lender” shall have the meaning assigned to such term in Section 2.18(c).

      

      “Incremental Term
Loan” shall have the meaning assigned to such term in Section 2.18(b).

      

      “Indemnified
Taxes” shall mean Taxes other than Excluded Taxes.

       

      
        
          
          

        

        
          - 5
-

          
            

          

        

        
          
          

        

      

       

      “Interest Payment
Date” shall have the meaning assigned to such term in Section 2.6.

      

      “Interest
Rate” shall have the meaning assigned to such term in Section 2.6.

      

      “Interest Reset
Date” shall mean the last Business Day of March, June, September and
December of each year.

      

      “Lenders”
shall have the meaning assigned to such term in the opening paragraph of this
Agreement.

      

      “LIBOR”
shall mean that rate per annum that is equal to the quotient of:

      

      (i)           the
rate per annum for deposits in Dollars for a three-month period, which rate
appears on Reuters Screen LIBOR01 Page (or any successor page), or such similar
service as determined by the Administrative Agent that displays the British
Bankers’ Association Interest Settlement Rates for deposits in Dollars as of
11:00 a.m. (London, England time) on the day that is two Business Days
prior to the Closing Date and each Interest Reset Date; provided, that if the
Administrative Agent determines that no such offered rate appears on such page,
the rate used will be the per annum rate of interest determined by the
Administrative Agent to be the average (rounded upward, if necessary, to the
nearest 1/100th of 1%) of the rates per annum at which deposits in Dollars for a
three-month period are offered to the Administrative Agent by leading banks in
the London interbank market as of 10:00 a.m. (New York, New York time) on the
day that is two (2) Business Days prior to each Interest Reset Date, divided
by

      

      (ii)           a
percentage equal to 1.00 minus the maximum reserve percentages (including any
emergency, supplemental, special or other marginal reserves) expressed as a
decimal (rounded upward to the next 1/100th of 1%) in effect on any day to which
the Administrative Agent is subject with respect to any Eurodollar Loan pursuant
to regulations issued by the FRB with respect to eurocurrency funding (currently
referred to as “eurocurrency liabilities” under Regulation
D).  Eurodollar Loans shall be deemed to constitute eurocurrency
funding and to be subject to such reserve requirements without benefit of or
credit for proration, exemptions or offsets that may be available from time to
time to any Lender under Regulation D.  This percentage will be
adjusted automatically on and as of the effective date of any change in any
reserve percentage.

      

      “Loan”
shall mean each Term Loan and each Incremental Term Loan; and “Loans”
shall mean the Term Loans and the Incremental Term Loans,
collectively.

       

      
        
          
          

        

        
          - 6
-

          
            

          

        

        
          
          

        

      

       

      “Loan
Documents” shall mean, collectively, this Agreement, each Subordinated
Term Note and any and all other instruments, agreements, documents and writings
executed in connection with any of the foregoing.

      

      “Material Adverse
Effect” shall mean, with respect to any event, act, condition or
occurrence of whatever nature (including any adverse determination in any
litigation, arbitration, or governmental investigation or proceeding), whether
singly or in conjunction with any other event or events, act or acts, condition
or conditions, occurrence or occurrences whether or not related, a material
adverse change in, or a material adverse effect on, (i) the business,
results of operations, financial condition, assets, liabilities or prospects of
either (x) the Borrower or (y) the Parent and its Subsidiaries taken as a whole,
(ii) the ability of the Borrower to perform any of its obligations under
the Loan Documents, (iii) the rights and remedies of Administrative Agent
and the Lenders under any of the Loan Documents or (iv) the legality,
validity or enforceability of any of the Loan Documents.

      

      “Maturity
Date” shall mean August 29, 2015.

      

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

      

      “Other
Taxes” shall mean any and all present and future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies, other
than Excluded Taxes, arising from any payment made hereunder or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement or any other Loan Documents.

      

      “Parent”
shall mean United Community Banks, Inc., a Georgia corporation, and its
successors and assigns.

      

      “Participant”
shall have the meaning set forth in Section 8.4(c).

      

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

      

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

      

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

      

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

       

      
        
          
          

        

        
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      “Pro Rata
Share” shall mean, with respect to any Lender at any time, a percentage,
the numerator of which shall be the sum of (a) such Lender’s Commitment (if any)
plus (b) the aggregate
principal amount of Loans held by such Lender at such time and the denominator
of which shall be the sum of (x) the Aggregate Commitments (if any) plus (y) the aggregate
principal amount of all Loans then outstanding.

      

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

      

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

      

      “Required
Lenders” shall mean, at any time, those Lenders holding more than 66-2/3%
of the aggregate outstanding Loans at such time, or if the Lenders have no Loans
outstanding, then Lenders holding more than 66-2/3% of the Aggregate
Commitments; provided, however, if the
number of Lenders under this Agreement at any time shall be two (2) or less,
“Required Lenders” shall mean, during such time, all Lenders.

      

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

      

      “Subordinated Term
Note” shall mean a promissory note of the Borrower payable to the order
of each Lender in substantially the form of Exhibit A.

      

      “Subsidiary”
shall mean, with respect to any Person (the “parent”),
any corporation, partnership, joint venture, limited liability company,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent’s consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, part­nership, joint venture, limited
liability company, association or other entity (i) of which securities or
other ownership interests representing more than 50% of the equity or more than
50% of the ordinary voting power, or in the case of a partnership, more than 50%
of the general partnership interests are, as of such date, owned, controlled or
held, or (ii) that is, as of such date, otherwise controlled, by the parent
or one or more subsidiaries of the parent or by the parent and one or more
subsidiaries of the parent.  Unless otherwise indicated, all
references to “Subsidiary” hereunder shall mean a Subsidiary of the
Borrower.

       

      
        
          
          

        

        
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      “Taxes”
means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority, including any interest, additions to tax or penalties applicable
thereto.

      

      “Term Loan”
shall have the meaning set forth in Section 2.1.

      

      “Tier 2
Capital” shall have the definition provided in, and shall be determined
in accordance with, the rules and regulations of the FDIC.

      

      “Type”,
when used in reference to a Loan, refers to whether the rate of interest on such
Loan, is determined by reference to LIBOR or the Base Rate.

      

      “Withdrawal
Liability” shall mean liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

      

      Section 1.2.
Terms
Generally.  The
definitions of terms herein shall apply equally to the singular and plural forms
of the terms defined.  The words “include”, “includes” and “including”
shall be deemed to be followed by the phrase “without limitation”.  In
the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including” and the word “to” means “to but
excluding”.  Unless the context requires otherwise (i) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as it was originally executed or as it may from time to time be amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (ii) any
reference herein to any Person shall be construed to include such Person’s
successors and permitted assigns, (iii) the words “hereof”, “herein” and
“hereunder” and words of similar import shall be construed to refer to this
Agreement as a whole and not to any particular provision hereof, (iv) all
references to Articles, Sections, Exhibits and Schedules shall be construed
to refer to Articles, Sections, Exhibits and Schedules to this Agreement
and (v) all references to a specific time shall be construed to refer to
Atlanta, Georgia time, unless otherwise indicated.

       

      
        
          
          

        

        
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      ARTICLE II.
AMOUNT AND
TERMS OF THE SUBORDINATED TERM
LOAN

      

      Section 2.1. 
Term Loan
Commitment.  Subject
to the terms and conditions set forth herein, each Lender severally agrees to
make a single term loan (each, a “Term Loan”) to the
Borrower on the Closing Date in a principal amount not to exceed the Commitment
of such Lender; provided, that if for
any reason the full amount of such Lender’s Commitment is not fully drawn on the
Closing Date, the undrawn portion thereof shall automatically be
cancelled.

      

      Section 2.2. 
Procedure for
Borrowing Term Loans.  The
execution and delivery of this Agreement by the Borrower and the satisfaction of
all conditions precedent pursuant to Section 3.1 and
Section 3.2
shall be deemed to constitute the Borrower’s request to borrow the Term Loans on
the Closing Date.

      

      Section 2.3. 
Funding
of Borrowings.

      

      (a)           Each
Lender will make available each Loan to be made by it hereunder on the date of
such Borrowing by wire transfer in immediately available funds by 11:00 a.m. to
the Administrative Agent at the Payment Office.  The Administrative
Agent will make such Loans available to the Borrower by promptly crediting the
amounts that it receives, in like funds by the close of business on such date,
to an account maintained by the Borrower with the Administrative Agent or at the
Borrower’s option, by effecting a wire transfer of such amounts to an account
designated by the Borrower to the Administrative Agent in writing for such
purpose.

      

      (b)           Unless
the Administrative Agent shall have been notified by any Lender prior to 5:00
p.m. one (1) Business Day prior to the date of a Borrowing that such Lender will
not make available to the Administrative Agent such Lender’s share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent on such date, and the
Administrative Agent, in reliance on such assumption, may make available to the
Borrower on such date a corresponding amount.  If such corresponding
amount is not in fact made available to the Administrative Agent by such Lender
on the date of such Borrowing, the Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest at the Federal Funds Rate for up to two (2) days and thereafter at the
rate specified for such Borrowing.  If such Lender does not pay such
corresponding amount forthwith upon the Administrative Agent’s demand therefor,
the Administrative Agent shall promptly notify the Borrower, and, subject to the
approval of the FDIC and other Governmental Authorities (if applicable), the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent together with interest at the rate specified for such
Borrowing.  Nothing in this subsection shall be deemed to relieve
any Lender from its obligation to fund its Pro Rata Share of any Borrowing
hereunder or to prejudice any rights which the Borrower may have against any
Lender as a result of any default by such Lender hereunder.

       

      
        
          
          

        

        
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      (c)           All
Borrowings shall be made by the Lenders on the basis of their respective Pro
Rata Shares.  No Lender shall be responsible for any default by any
other Lender in its obligations hereunder, and each Lender shall be obligated to
make its Loans provided to be made by it hereunder, regardless of the failure of
any other Lender to make its Loans hereunder.

      

      Section 2.4. 
Termination
of Commitments.

        The
Commitments shall terminate on the Closing Date upon the making of the Term
Loans.

      

      Section 2.5. 
Repayment
and Prepayments of Loans.

      

      (a)           The
aggregate outstanding principal amount of all Loans shall be due and payable
(together with accrued and unpaid interest thereon) on the Maturity
Date.  All payments in respect of the Loans shall be applied first to
accrued interest and the balance, if any, to principal.  Once repaid,
none of the Loans may be reborrowed.

      

      (b)           The
Borrower shall have the right at any time and from time to time, subject to the
approval of the FDIC and other Governmental Authorities (if applicable), to
prepay any Borrowing, in whole or in part, without premium or penalty, by giving
irrevocable written notice to the Administrative Agent no later than five (5)
Business Days prior to any such prepayment.  Each such notice shall be
irrevocable and shall specify the proposed date of such prepayment and the
principal amount of each Borrowing or portion thereof to be
prepaid.  Upon receipt of any such notice, the Administrative Agent
shall promptly notify each Lender of the contents thereof and of such Lender’s
Pro Rata Share of any such prepayment.  If such notice is given, the
aggregate amount specified in such notice shall be due and payable on the date
designated in such notice, together with accrued interest to such date on the
amount so prepaid in accordance with Section 2.15(a);
provided, that
if a Eurodollar Borrowing is prepaid on a date other than an Interest Reset
Date, the Borrower shall also pay all amounts required pursuant to Section 2.13.  Each
partial prepayment of any Borrowing shall be in a minimum aggregate amount of
not less than $2,500,000.  Each prepayment of a Borrowing shall be
applied ratably to the Loans comprising such Borrowing and shall be applied
first to accrued interest and then to the principal balance.

      

      Section 2.6. 
Interest
on Loans.

      

      (a)           Interest
on the principal amount of all Loans shall accrue from and including the date
such Loans are made to but excluding the date of any repayment
thereof.  The Borrower shall pay interest on each Loan in arrears on
the last day of March, June, September  and December of each year and
on the Maturity Date (each, an “Interest Payment
Date”) at a rate equal to LIBOR plus four percent (4%) per
annum (the “Interest
Rate”).  The initial Interest Payment Date in respect of the
Term Loan shall be September 30, 2008.  The initial Interest
Payment Date in respect of each Incremental Term Loan (if any) shall be the
Interest Payment Date immediately following the date on which such Incremental
Term Loan is made.

       

      
        
          
          

        

        
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      (b)           The
Interest Rate in respect of the Term Loans for the period from the Closing Date
to September 30, 2008 shall be 6.81% per annum, which was determined by
reference to the then prevailing LIBOR.  The Interest Rate in respect
of each Incremental Term Loan (if any) for the period from the date such
Incremental Term Loan is made to the immediately following Interest Reset Date
shall be set forth in each Subordinated Term Note issued in connection with the
making of such Incremental Term Loan (which shall be determined by reference to
the then prevailing LIBOR).  Thereafter, in the case of each Loan, the
Interest Rate shall be reset on a quarterly basis on the first day of each
Interest Reset Date by reference to the then prevailing LIBOR.  If any
Interest Reset Date falls on a day that is not a Business Day, the Interest
Reset Date shall be postponed to the next succeeding Business Day, except if
that Business Day is in the next succeeding calendar month, the Interest Reset
Date shall be the immediately preceding Business Day.

      

      (c)           Following
the occurrence of an Event of Default, and in any event after acceleration,
interest on all Loans shall cease to accrue interest at the Interest Rate and
shall thereafter bear interest at the Base Rate plus the Base Rate Margin
plus 2% per
annum.  All interest payable under this clause (c) shall be payable on
demand.

      

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

      

      Section 2.7. 
Certain
Fees.

        The
Borrower shall pay to the Administrative Agent, for the ratable benefit of each
Lender, the upfront fees agreed upon by the Borrower and the Administrative
Agent pursuant to that certain fee letter dated June 25, 2008 (the “Fee Letter”)
among the Borrower, SunTrust Bank and SunTrust Robinson Humphrey, Inc., which
upfront fees shall be due and payable on the Closing Date.  The
Borrower shall also pay to SunTrust Bank and SunTrust Robinson Humphrey, Inc.,
for their respective accounts, fees in the amounts and at the times agreed upon
in the Fee Letter.

      

      Section 2.8. 
Computation of
Interest and Fees.  All
computations of interest and fees hereunder shall be made on the basis of a year
of 360 days for the actual number of days (including the first day but
excluding the last day) occurring in the period for which such interest or fees
are payable (to the extent computed on the basis of days
elapsed).  Each determination by the Administrative Agent of an
interest amount or fee hereunder shall be made in good faith and, except for
manifest error, shall be final, con­clusive and binding for all
purposes.

      

      Section 2.9. 
Inability to
Determine Interest Rates.  If
prior to the occurrence of any Interest Reset Date, the Administrative Agent
shall have determined (which determination shall be conclusive and binding upon
the Borrower absent manifest error) that by reason of circumstances affecting
the relevant interbank market, (a) adequate means do not exist for
ascertaining LIBOR, or (b) the Administrative Agent shall have received
notice from the Required Lenders that LIBOR does not adequately and fairly
reflect the cost to such Lenders of making, funding or maintaining its
Eurodollar Loans, the Administrative Agent shall give written notice (or
telephonic notice, promptly confirmed in writing) to the Borrower as soon as
practicable thereafter.  Until the Administrative Agent notifies the
Borrower and the Lenders that the circumstances giving rise to such notice no
longer exist, all such affected Loans outstanding shall be deemed to be
converted into Base Rate Loans as of such date and shall bear interest at the
Base Rate plus the Base
Rate Margin.

       

      
        
          
          

        

        
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      Section 2.10. 
Evidence of
Indebtedness.  Each
Lender shall maintain in accordance with its usual practice appropriate records
evidencing the indebtedness of the Borrower to such Lender resulting from each
Loan made by such Lender from time to time, including the amounts of principal
and interest payable thereon and paid to such Lender from time to time under
this Agreement.  The Administrative Agent shall maintain appropriate
records in which shall be recorded (i) the Commitment of each Lender,
(ii) the amount of each Loan made hereunder by each Lender, the Type
thereof, (iii) the date of each required conversion of any Loan from a
Eurodollar Loan to a Base Rate Loan, (iv) the date and amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder in respect of such Loans and (v) both the
date and amount of any sum received by the Administrative Agent hereunder from
the Borrower in respect of the Loans and each Lender’s Pro Rata Share
thereof.  The entries made in such records shall be prima facie
evidence of the existence and amounts of the obligations of the Borrower therein
recorded; provided, that the failure or delay of any Lender or the
Administrative Agent in maintaining or making entries into any such record or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans (both principal and unpaid accrued interest) of such Lender
in accordance with the terms of this Agreement.  On the Closing Date,
the Borrower will execute and deliver a Subordinated Term Note to each Lender in
a principal amount equal to the amount of the Term Loan funded by such Lender on
the Closing Date.

      

      Section 2.11. 
Illegality.  If
any Change in Law shall make it unlawful or impossible for any Lender to make,
maintain or fund any Eurodollar Loan and such Lender shall so notify the
Administrative Agent, the Administrative Agent shall promptly give notice
thereof to the Borrower and the other Lenders, whereupon until such Lender
notifies the Administrative Agent and the Borrower that the circumstances giving
rise to such suspension no longer exist, the obligation of such Lender to make
Eurodollar Loans shall be suspended.  In the case of the making of a
Eurodollar Borrowing, such Lender’s Loan shall be made as a Base Rate Loan and
if the affected Eurodollar Loan is then outstanding, such Loan shall be
converted to a Base Rate Loan either (x) on the next Interest Reset Date if
such Lender may lawfully continue to maintain such Eurodollar Loan to such date
or (y) immediately if such Lender shall determine that it may not lawfully
continue to maintain such Eurodollar Loan to such Interest Reset
Date.

      

      Section 2.12. 
Increased
Costs.

      

      (a)           If
any Change in Law shall:

       

      
        
          
          

        

        
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      (i)

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

              

      

      

      (ii)           impose
on any Lender or the eurodollar interbank market any other condition affecting
this Agreement or any Eurodollar Loans made by such Lender;

      

      and the
result of the foregoing is to increase the cost to such Lender of making or
maintaining a Eurodollar Loan or to reduce the amount received or receivable by
such Lender hereunder (whether of principal, interest or any other amount), then
the Borrower shall promptly pay, upon written notice from and demand by such
Lender (with a copy of such notice and demand to the Administrative Agent), to
the Administrative Agent for the account of such Lender, within five Business
Days after the date of such notice and demand, additional amount or amounts
sufficient to compensate such Lender for such additional costs incurred or
reduction suffered.

      

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

      

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

      

      (d)           Failure
or delay on the part of a Lender to demand compensation pursuant to this Section
shall not constitute a waiver of such Lender’s right to demand such
compensation; provided, however, that the
Borrower shall not be required to compensate a Lender pursuant to this Section
for (x) any increased cost or reduction of amounts received or receivable
described in paragraph (a) or (y) any reduction of the rate of return on such
Lender’s capital described in paragraph (b), if such increase or reduction, as
the case may be, is suffered more than 180 days prior to the date that such
Lender gives any required notice and demand (except that, if the Change in Law
that causes such increase or reduction, as the case may be, is retroactive, then
the 180 day period referred to above shall be extended to include the period of
retroactive effect thereof).

       

      
        
          
          

        

        
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      Section 2.13. 
Funding Indemnity.  In
the event of (a) the payment of any principal of a Loan other than on an
Interest Reset Date or the Maturity Date or (b) the failure by the Borrower
to borrow or prepay any Loan on the date specified in any applicable notice
(regardless of whether such notice is withdrawn or revoked), then, in any such
event, the Borrower shall compensate each Lender, within five (5) Business Days
after written demand from such Lender, for any loss, cost or expense
attributable to such event; provided, however, that the
Borrower shall not be required to compensate such Lender pursuant to this
Section if such written demand is delivered more than 90 days after (i) all
Loans and all other amounts outstanding hereunder are repaid in full in cash and
(ii) this Agreement is terminated.  Such loss, cost or expense shall
be deemed to include an amount determined by such Lender to be the excess, if
any, of (A) the amount of interest that would have accrued on the principal
amount of such Loan if such event had not occurred at LIBOR applicable to such
Loan for the period from the date of such event to the next Interest Reset Date
(or in the case of a failure to borrow, for the period that would have been the
period through the next Interest Reset Date) over (B) the amount of
interest that would accrue on the principal amount of such Loan for the same
period if LIBOR were set on the date such Loan was prepaid or the date on which
the Borrower failed to borrow such Loan.  A certificate as to any
additional amount payable under this Section 2.13
submitted to the Borrower by any Lender shall be conclusive, absent manifest
error.

      

      Section 2.14.  Taxes.

      

      (a)           Any
and all payments by or on account of any obligation of the Borrower hereunder
shall be made free and clear of and without deduction for any Indemnified Taxes
or Other Taxes; provided, that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent or any
Lender (as the case may be) shall receive an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall
make such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.

      

      (b)           In
addition, the Borrower shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.

      

      (c)           The
Borrower shall indemnify the Administrative Agent and each Lender, within five
(5) Business Days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent or such
Lender, as the case may be, on or with respect to any payment by or on account
of any obligation of the Borrower hereunder (including Indemnified Taxes or
Other Taxes imposed or asserted on or attributable to amounts payable under this
Section) and any penalties, interest and reasonable expenses arising therefrom
or with respect thereto, whether or not such Indemnified Taxes or Other Taxes
were correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender, or by the Administrative Agent
on its own behalf or on behalf of a Lender, shall be conclusive absent manifest
error.

       

      
        
          
          

        

        
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      (d)           As
soon as practicable after any payment of Indemnified Taxes or Other Taxes by the
Borrower to a Governmental Authority, the Borrower shall deliver to the
Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.

      

      (e)           Any
Foreign Lender that is entitled to an exemption from or reduction of withholding
tax under the Code or any treaty to which the United States is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law, such properly completed and executed documentation prescribed by applicable
law or reasonably requested by the Borrower as will permit such payments to be
made without withholding or at a reduced rate of withholding.  Without
limiting the generality of the foregoing, each Foreign Lender agrees that it
will deliver to the Administrative Agent and the Borrower (or in the case of a
Participant, to the Lender from which the related participation shall have been
purchased), as appropriate, two (2) duly completed copies of (i) Internal
Revenue Service Form W-8 ECI, or any successor form thereto, certifying that the
payments received from the Borrower hereunder are effectively connected with
such Foreign Lender’s conduct of a trade or business in the United States; or
(ii) Internal Revenue Service Form W-8 BEN, or any successor form thereto,
certifying that such Foreign Lender is entitled to benefits under an income tax
treaty to which the United States is a party which reduces or eliminates the
rate of withholding tax on payments of interest; or (iii) Internal Revenue
Service Form W-8 BEN, or any successor form prescribed by the Internal Revenue
Service, together with a certificate (A) establishing that the payments to the
Foreign Lender from the Borrower hereunder qualify as “portfolio interest”
exempt from U.S. withholding tax under Code section 871(h) or 881(c), and (B)
stating that (1) the Foreign Lender is not a bank for purposes of Code section
881(c)(3)(A), or the obligation of
the Borrower hereunder is not, with respect to such Foreign Lender, a loan
agreement entered into in the ordinary course of its trade or business, within
the meaning of that section; (2) the Foreign Lender is not a 10% shareholder of
the Borrower within the meaning of Code section 871(h)(3) or 881(c)(3)(B); and
(3) the Foreign Lender is not a controlled foreign corporation that is a related
Person to the Borrower within the meaning of Code section 881(c)(3)(C); or (iv)
such other Internal Revenue Service forms as may be applicable to the Foreign
Lender, including Forms W-8 IMY or W-8 EXP.  Each such Foreign Lender
shall deliver to the Borrower and the Administrative Agent such forms on or
before the date that it becomes a party to this Agreement (or in the case of a
Participant, on or before the date such Participant purchases the related
participation).  In addition, each such Foreign Lender shall deliver
such forms within ten (10) Business Days after the obsolescence or invalidity of
any form previously delivered by such Foreign Lender. Each such Foreign Lender
shall promptly notify the Borrower and the Administrative Agent in writing at
any time that it determines that it is no longer in a position to provide any
previously delivered certificate to the Borrower (or any other form of
certification adopted by the Internal Revenue Service for such
purpose).

      

      
        
          
          

        

        
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      Section 2.15. 
Payments
Generally; Pro Rata Treatment.

      

      (a)           The
Borrower shall make each payment required to be made by it hereunder (whether of
principal, interest or fees or of amounts payable under Section 2.5,
Section 2.6 or
Section 2.7 or
otherwise) prior to 12:00 noon, on the date when due, in immediately available
funds, without set-off or counterclaim.  Any amounts received after
such time on any date may, in the discretion of the Administrative Agent, be
deemed to have been received on the next succeeding Business Day for purposes of
calculating interest thereon.  All such payments shall be made to the
Administrative Agent at the Payment Office, except that payments pursuant to
Section 2.12,
Section 2.13 and
Section 8.3
shall be made directly to the Persons entitled thereto.  The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof.  If any payment hereunder shall be due on a day that
is not a Business Day, the date for payment shall be extended to the next
succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be made payable for the period of such
extension.  All payments hereunder shall be made in
Dollars.

      

      (b)           If
at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, interest and fees
then due hereunder, such funds shall be applied first, towards payment of
interest and fees then due hereunder, ratably among the parties entitled thereto
in accordance with the amounts of interest and fees then due to such parties,
and second, towards payment of principal then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of principal then due to
such parties.

      

      (c)           If
any Lender shall obtain payment in respect of any principal of or interest on
any of its Loans that would result in such Lender receiving payment of a greater
proportion of the aggregate amount of its Loans and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Loans of other Lenders to the extent necessary so that the benefit of all such
payments shall be shared by the Lenders ratably in accordance with the aggregate
amount of principal of and accrued interest on their respective Loans; provided, that
(i) if any such participations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations shall be rescinded
and the purchase price restored to the extent of such recovery, without
interest, and (ii) the provisions of this paragraph shall not be construed
to apply to any payment made by the Borrower pursuant to and in accordance with
the express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans to any assignee or participant, other than to the Borrower or any
Subsidiary or affiliate thereof (as to which the provisions of this paragraph
shall apply).

       

      
        
          
          

        

        
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      (d)           Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Administrative Agent for the account
of the Lenders hereunder that the Borrower will not make such payment, the
Administrative Agent may assume that the Borrower has made such payment on such
date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders the amount or amounts due.  In such event,
if the Borrower has not in fact made such payment, then the Lenders severally
agree to repay to the Administrative Agent forthwith on demand the amount so
distributed to the Lenders with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the greater of the Federal Funds Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.

      

      (e)           If
any Lender shall fail to make any payment required to be made by it pursuant to
Section 2.3(a),
Section 2.15(d),
or Section 8.3(d),
then the Administrative Agent may, in its discretion (notwithstanding any
contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations under such Sections until all such unsatisfied obligations are fully
paid.

      

      (f)           Each
Lender agrees that, so long as the Loans are deemed to be Tier 2 Capital, other
than due to the limitation imposed by the second sentence of 12 C.F.R. Part 325,
App. A(I)(A)(2)(e), such Lender waives its right to exercise any set-off or
other right to appropriate and to apply any deposits or other assets of the
Borrower at any time held by such Lender against or on account of any of the
Loans owing hereunder or owing under a Subordinated Term Note to such
Lender.

      

      Section 2.16. 
Mitigation
of Obligations;
Replacement of Lenders

      

      (a)           Prior
to any Lender requesting compensation under Section 2.12, or
the Borrower being required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.14,
the applicable Lender shall use reasonable efforts to designate a different
lending office for funding or booking its Loans hereunder or to assign its
rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the sole judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable under Section 2.12 or
Section 2.14, as
the case may be, in the future and (ii) would not subject such Lender to
any unreimbursed cost or expense and would not otherwise be disadvantageous to
such Lender.  The Borrower hereby agrees to pay all costs and expenses
incurred by any Lender in connection with such designation or
assignment.

      

      (b)           If any Lender requests compensation
under Section 2.12, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.14, then the Borrower may, at its sole
cost and expense, upon notice to any such Lender and the Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance with
and subject to the restrictions set forth in Section 8.4(b) all of its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender); provided, that (i) the Borrower shall have
received the prior written consent of the Administrative Agent, which consent
shall not be unreasonably withheld, (ii) such assigning Lender shall have
received payment of an amount equal to the outstanding principal amount of all
Loans owed to it, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder, from the assignee (in the case of such outstanding
principal and accrued interest) and from the Borrower (in the case of all other
amounts) and (iii) in the case of a claim for compensation under Section 2.12 or payments required to be made
pursuant to Section 2.14, such assignment will result in a
reduction or elimination of such compensation or payments.  A Lender
shall not be required to make any such assignment and delegation if, prior
thereto, as a result of an irrevocable waiver by such Lender, the circumstances
entitling the Borrower to require such assignment and delegation ceases to
apply.

       

      
        
          
          

        

        
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      Section 2.17. 
Subordinated and Unsecured Obligations.  All
Loans are unsecured obligations of the Borrower and are subordinated to the
extent set forth in the Subordinated Term Notes.

      

      Section 2.18. 
Incremental
Facility.

       

      (a)           Upon
notice to the Administrative Agent (whereupon the Administrative Agent shall
promptly notify the Lenders), at any time after the Closing Date, the Borrower
may from time to time request additional Commitments for Term Loans (each an
“Incremental Commitment” and all of them, collectively, the “Incremental
Commitments”); provided that (x)
after giving effect to any such addition, the aggregate amount of Incremental
Commitments that have been added pursuant to this Section shall not exceed
$70,000,000 and (y) any such addition or increase shall be in an amount of not
less than $2,000,000.

       

      (b)           Any
Loans made in respect of any Incremental Commitments (the “Incremental Term
Loans”) shall be made by increasing the Aggregate Commitments with such
Incremental Term Loans having identical terms (including pricing) as the
existing Term Loans.

       

      (c)           Each
notice from the Borrower pursuant to this Section shall set forth the requested
amount of the Incremental Commitments.  Incremental Term Loans (or any
portion thereof) may be made by any existing Lender or by any other bank,
financial institution or other investing entity (any such bank, financial
institution or other investing entity, an “Incremental Lender”), in each case on
terms permitted in this Section and otherwise on terms reasonably acceptable to
the Administrative Agent, provided that the
Administrative Agent shall have consented (such consent not to be unreasonably
withheld) to such Lender’s or Incremental Lender’s, as the case may be, making
such Incremental Term Loans if such consent would be required under Section 8.4 for
an assignment of Loans to such Lender or Incremental Lender, as the case may
be.  No Lender shall be obligated to provide any Incremental Term
Loans unless it so agrees.  Any Incremental Commitments shall become
effective under this Agreement pursuant to an amendment (an “Incremental
Facility Amendment”) to this Agreement and, as appropriate, the other Loan
Documents, executed by the Borrower, each Lender agreeing to provide such
Commitment, if any, each Incremental Lender, if any, and the Administrative
Agent.  At the time of the sending of such notice, the Borrower (in
consultation with the Administrative Agent) shall specify the time period within
which each Lender is requested to respond (which shall in no event be less than
ten Business Days from the date of delivery of such notice to the
Lenders).  Each Lender shall notify the Administrative Agent within
such time period whether or not it agrees to provide an Incremental Commitment
and, if so, whether by an amount equal to, greater than, or less than its Pro
Rata Share of such requested increase.  Any Lender not responding
within such time period shall be deemed to have declined to provide an
Incremental Commitment.  The Administrative Agent shall notify the
Borrower and each Lender of the Lenders’ responses to each request made
hereunder.  To achieve the full amount of a requested increase, the
Borrower may, after first offering such increase to the existing Lenders as
provided above, invite Incremental Lenders to become Lenders pursuant to a
joinder agreement in form and substance reasonably satisfactory to the
Administrative Agent and its counsel.

       

      
        
          
          

        

        
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      (d)           If
any Incremental Commitments are added in accordance with this Section 2.14, the
Administrative Agent and the Borrower shall determine the effective date (the
“Incremental Commitments Effective Date”) and the final allocation of such
addition; provided, that any
existing Lender electing to participate in the proposed Incremental Commitments
shall have the right to participate in the proposed increase or addition on a
pro rata basis in accordance with Term Loans held by such Lender as of the
Business Day prior to the Incremental Commitments Effective Date.  The
Administrative Agent shall promptly notify the Borrower and the Lenders of the
final allocation of such addition and the Incremental Commitments Effective
Date.  As conditions precedent to such addition, (i) the Borrower
shall deliver to the Administrative Agent a certificate in the form attached
hereto as Exhibit 3.1(b)(vi) dated as of the Incremental Commitments Effective
Date, and (ii) each of the conditions set forth in Section 3.2 shall be
satisfied as of the Incremental Commitments Effective Date.  On the
Incremental Commitments Effective Date, each Lender or Incremental Lender which
is providing an Incremental Commitment (i) shall become a “Lender” for all
purposes of this Agreement and the other Loan Documents, (ii) shall make an
Incremental Term Loan to the Borrower in a principal amount equal to such
Incremental Term Commitment, and such Incremental Term Loan shall be a “Loan”
for all purposes of this Agreement and the other Loan Documents and (ii) the
Borrower shall execute and deliver to each Lender or Incremental Lender
providing an Incremental Commitment a new Subordinated Term Note in the amount
of such Lender’s or Incremental Lender’s Incremental Term Loans after giving
effect to the Incremental Commitments.

       

      
        
          
          

        

        
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      (e)           This
Section shall supersede any provisions in Section 8.2 to
the contrary.

       

      ARTICLE III. 
CONDITIONS TO
EFFECTIVENESS AND MAKING OF LOANS

      

      Section 3.1. 
Conditions To
Effectiveness.  The
effectiveness of this Agreement, and the willingness of each Lender to make
Loans hereunder, shall not become effective until the date on which each of the
following conditions is satisfied (or waived in accordance with Section 8.2).

      

      (a)           The
Administrative Agent shall have received all fees and other amounts due and
payable on or prior to the Closing Date, including (i) reimbursement or payment
of all out-of-pocket expenses (including reasonable fees, charges and
disbursements of counsel to the Administrative Agent) required to be reimbursed
or paid by the Borrower hereunder, under any other Loan Document and under the
Fee Letter and (ii) the upfront fees payable to the Lenders in accordance with
the Fee Letter.

      

      (b)           The
Administrative Agent (or its counsel) shall have received the following, each in
form and substance satisfactory to the Administrative Agent:

      

      (i)           a
counterpart of this Agreement signed by or on behalf of each party hereto or
written evidence satisfactory to the Administrative Agent (which may include
facsimile transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement;

      

      (ii)           duly
executed Subordinated Term Notes payable to each Lender in respect of the Term
Loans;

      

      (iii)           a
certificate of the Secretary or Assistant Secretary of the Borrower in the form
of Exhibit 3.1(b)(iii), attaching and certifying copies of its bylaws and of the
resolutions of its board of directors, authorizing the execution, delivery and
performance of the Loan Documents and certifying the name, title and true
signature of each officer of the Borrower executing the Loan
Documents;

      

      (iv)           (a)
a copy of the charter of the Borrower, certified by the appropriate Governmental
Authority and (b) a certificate of existence for the Borrower issued by the
Georgia Department of Banking and Finance;

      

      (v)           a
favorable written opinion of Kilpatrick Stockton LLP, counsel to the Borrower,
addressed to the Administrative Agent and each of the Lend­ers, and covering
such matters relating to the Borrower, the Parent, the Loan Documents and the
transactions contemplated therein, that are set forth in
Exhibit 3.1(b)(v);

       

      
        
          
          

        

        
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      (vi)           a
certificate in the form of Exhibit 3.1(b)(vi), dated the Closing Date and signed
by a Responsible Officer, certifying that (w) no Event of Default exists, (x)
all representations and warranties of the Borrower set forth in the Loan
Documents are true and correct, and (y) since the date of the financial
statements of the Parent described in Section 4.4,
there shall have been no change, event or other circumstance which has had or
could reasonably be expected to have a Material Adverse Effect;

      

      (vii)           certified
copies of all consents, approvals, authorizations, registrations and filings and
orders required to be made or obtained under any applicable laws in connection
with the execution, delivery, performance, validity and enforceability of the
Loan Documents or any of the transactions contemplated thereby, and such
consents, approvals, authorizations, registrations, filings and orders shall be
in full force and effect and all applicable waiting periods shall have expired,
and no investigation or inquiry by any Governmental Authority regarding the
Commitments or any transaction being financed with the proceeds thereof shall be
ongoing;

      

      (viii)        a
duly executed copy of the Call Report of the Borrower most recently available as
of the Closing Date, and

      

      (ix)          
such other documents, agreements and instruments as the Administrative Agent on
behalf of the Lenders may reasonably request.

      

      Section 3.2. 
Each
Loan.  The
willingness of each Lender to make a Loan under this Agreement is subject to the
satisfaction of the following conditions:

      

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

      

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

      

      (c)           since
June 30, 2008, there shall have been no change which has had or could
reasonably be expected to have a Material Adverse Effect;

      

      (d)           no
legislation has been passed or any suit or other proceeding has been instituted
the effect of which is to prohibit, enjoin (or to declare unlawful or improper)
or otherwise adversely affect the Borrower’s performance of its obligations
hereunder, and no litigation or governmental proceeding has been instituted or
threatened against the Parent or the Borrower or any of their officers or
shareholders which may adversely affect the financial condition or operations of
the Parent or the Borrower;

       

      
        
          
          

        

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

      

      Each Borrowing shall
be deemed to constitute a representation and warranty by the Borrower on the
date thereof as to the matters specified in paragraphs (a), (b), (c) and (d) of
this Section 3.2.

      

      ARTICLE IV.
REPRESENTATIONS
AND WARRANTIES

      

      The
Borrower represents and warrants to Administrative Agent and the Lenders as
follows:

       

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

      

      Section 4.2. 
Organizational
Power; Authorization.  All
Borrowings, and the execution, delivery and performance by the Borrower of each
of the Loan Documents are within the Borrower’s powers and have been duly
authorized by all necessary corporate, and if required, stockholder,
action.  This Agreement has been duly executed and delivered by the
Borrower and constitutes, and each other Loan Document when executed and
delivered by the Borrower will constitute, valid and binding obligations of the
Borrower, en­forceable against it in accordance with their re­spective
terms, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting the enforcement of
creditors’ rights generally and by general principles of equity.

      

      Section 4.3. 
Governmental
Approvals; No Conflicts.  The
execution, delivery and performance by the Borrower of this Agreement and the
other Loan Documents (a) do not require any consent or approval of,
registration or filing with, or any action by, any Governmental Authority,
except those as have been obtained or made and are in full force and effect,
(b) will not violate any applicable law or regulation or the charter or
by-laws of the Borrower or any order of any Governmental Authority,
(c) will not violate or result in a default under any indenture, material
agreement or other material instrument binding on the Parent or any of its
Subsidiaries (including the Borrower), or any of their respective assets or give
rise to a right thereunder to require any payment to be made by the Parent or
any such Subsidiary (including the Borrower) and (d) will not result in the
creation or imposition of any lien, security interest or other encumbrance on
any asset of the Parent or any of its Subsidiaries (including the
Borrower).  All necessary regulatory approvals have been obtained for
the Parent and each of its Subsidiaries (including the Borrower) to conduct
their respective businesses.

       

      
        
          
          

        

        
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      Section 4.4. 
Financial
Statements.  The
Borrower has furnished to the Lenders (i) the audited consolidated balance sheet
of the Parent and its Subsidiaries as of December 31, 2007 and the
related consolidated statements of income, shareholders’ equity and cash flows
for the fiscal year then ended audited by Porter Keadle Moore, LLP and (ii) the
unaudited consolidated balance sheet of the Parent and its Subsidiaries as of
June 30, 2008, and the related unaudited consolidated statements of income and
cash flows for the fiscal quarter and year-to-date period then ending, certified
by a Responsible Officer.  Such financial statement fairly presents,
in all material respects, the consolidated financial position of the Parent and
its Subsidiaries as of such date and the consolidated results of operations and
cash flows for such period in conformity with GAAP consistently applied, subject
to year end audit adjustments and the absence of footnotes in the case of the
statements referred to in clause (ii).  Since June 30, 2008, there
have been no changes with respect to the Parent and its Subsidiaries which have
had or could reasonably be expected
to have, singly or in the aggregate, a material adverse change in, or a material
adverse effect on, the business, results of operations, financial condition,
assets, liabilities or prospects of the Parent and its Subsidiaries, taken as a
whole.  In addition, the Borrower has provided to the Lenders copies
of the Call Reports of the Borrower for the period ending
June 30, 2008.  Each of such Call Report is true and correct
and is in accordance with the respective books of account and records of the
Borrower, and has been prepared in accordance with applicable banking
regulations, rules and guidelines on a basis consistent with prior periods, and
fairly and accurately presents the financial condition of the Borrower and its
assets and liabilities and the results of its operations as of such
date.

      

      Section 4.5. 
Litigation
Matters and
Enforcement Actions.  No
litigation, investigation or proceeding of or before any arbitrators or
Governmental Authorities is pending against, or, to the knowledge of the
Borrower, threatened against or affecting the Parent or any of its Subsidiaries
(including the Borrower) (i) as to which there is a reasonable possibility
of an adverse determination that could reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect or (ii) which
in any manner draws into question the validity or enforceability of this
Agreement or any other Loan Document.  Neither the Parent nor any of
its Subsidiaries (including the Borrower), nor any of their respective officers,
directors, employees or representatives, is subject or is party to, or has
received any notice from any Governmental Authority that any of them will become
subject or party to any investigation with respect to, any cease-and-desist
order, agreement, civil monetary penalty, bar or suspension from the securities
investment or banking businesses, consent agreement, memorandum of understanding
or other regulatory enforcement action, proceeding or order with or by, or is a
party to any commitment letter or similar undertaking to, or is subject to any
directive by, or has been a recipient of any supervisory letter specifically
addressed to the Borrower that are from, or has adopted any board resolutions at
the request or suggestion of, any Governmental Authority that, in any such case,
currently restricts in any material respect the conduct of their business or
that in any material manner relates to their capital adequacy, their credit
policies, their management or their business (each, a “Regulatory Action”),
nor has the Parent or any of its Subsidiaries (including the Borrower) been
advised by any Governmental Authority that it is considering issuing or
requesting any such Regulatory Action; and there is no unresolved violation,
criticism or exception by any Governmental Authority with respect to any report
or statement relating to any examinations of the Parent or any of its
Subsidiaries (including the Borrower), except where such unresolved violation,
criticism or exception would not, singly or in the aggregate, have a Material
Adverse Effect.

       

      
        
          
          

        

        
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      Section 4.6. 
Compliance with
Laws and Agreements.  The
Parent and each of its Subsidiaries (including the Borrower) is in compliance
with all applicable laws (including without limitation all Environmental Laws
and all federal and state banking statutes) and all rules, regulations
(including without limitation all applicable federal and state banking
regulations) and orders of any Governmental Authority, except where such
non-compliance could not be reasonably be expected, singly or in the aggregate,
to have a Material Adverse Effect.  Neither the Parent nor any of its
Subsidiaries (including the Borrower) is in default in the performance,
observance or fulfillment of any of the terms, obligations, covenants,
conditions or provisions contained in any indenture or other agreement
creating, evidencing or securing indebtedness of any kind or pursuant to which
any such indebtedness is issued, or other agreement or instrument to which the
Parent or any of its Subsidiaries (including the Borrower) is a party or by
which the Parent or any of its Subsidiaries (including the Borrower) or any of
their respective properties may be bound or affected, except where such default
could not be reasonably be expected, singly or in the aggregate, to have a
Material Adverse Effect.  The Parent has not received any notice of
any default or event of default, and to its knowledge no default or event of
default has occurred and is continuing (or would occur after giving effect to
the making of the Loans pursuant to this Agreement), under the Credit Agreement
dated as of January 4, 2008 between the Parent and JPMorgan Chase Bank,
N.A.

      

      Section 4.7. 
Investment
Company Act.  The
Borrower is not an “investment company”, as defined in, or subject to regulation
under, the Investment Company Act of 1940, as amended.

      

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

      

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

       

      
        
          
          

        

        
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      Section 4.10. Disclosure.  The
Borrower has disclosed to the Lenders all agreements, instruments, and corporate
or other restrictions to which the Parent or any of its Subsidiaries (including
the Borrower) is subject, and all other matters known to any of them, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.  None of the reports (including Call
Reports), financial statements, certificates or other information furnished by
or on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation or syndication of this Agreement or any other
Loan Document or delivered hereunder or thereunder (as modified or supplemented
by any other information so furnished) contains any material misstatement of
fact or omits to state any material fact necessary to make the statements
therein, taken as a whole, in light of the circumstances under which they were
made, not misleading.

      

      Section 4.11.
Dividend
Restrictions; Other Restrictions.

      

      (a)           Neither
of the Parent nor any of its Subsidiaries (including the Borrower) has violated
any applicable regulatory restrictions on dividends, and no Governmental
Authority has taken any action to restrict the payment of dividends by the
Parent or any of its Subsidiaries (including the Borrower).

      

      (b)           Neither
of the Parent nor any of its Subsidiaries (including the Borrower) is under
investigation by, or is operating under any restrictions (excluding any
restrictions on the payment of dividends referenced in subsection (a)
above) imposed by or agreed to with, any Governmental Authority, other than
routine examinations by such Governmental Authorities.

      

      Section 4.12.
Capital
Measures.

      (a)           The
Parent is “well capitalized”, as determined in accordance with any regulations
established by such Governmental Authority.

      

      (b)           The
Borrower has been, or is deemed to have been, notified by the appropriate
Governmental Authority having regulatory authority over it that it is “well
capitalized”, as determined in accordance with any regulations established by
such Governmental Authority.

      

      Section 4.13.
FDIC
Insurance.  The
deposits of the Borrower are insured by the FDIC and no act has occurred that
would adversely affect the status of the Borrower as an FDIC insured
bank.

      

      Section 4.14.
Ownership
of Property.

      

      (a)           The
Parent and each of its Subsidiaries (including the Borrower) has good title to,
or valid leasehold interests in, all of its real and personal property material
to the operation of its business, free and clear of all liens, security
interests or other encumbrances.  All leases that individually or in
the aggregate are material to the business or operations of the Parent and each
of its Subsidiaries (including the Borrower) are valid and subsisting and are in
full force.

       

      
        
          
          

        

        
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      (b)           The
Parent and each of its Subsidiaries (including the Borrower) owns, or is
licensed, or otherwise has the right, to use, all patents, trademarks, service
marks, trade names, copyrights and other intellectual property material to its
business, and the use thereof by such Person does not infringe in any material
respect on the rights of any other Person.

      

      (c)           The
properties of the Parent and each of its Subsidiaries (including the Borrower)
are insured with financially sound and reputable insurance companies which are
not affiliates of such Person, in such amounts with such deductibles and
covering such risks as are customarily carried by banks engaged in similar
businesses and owning similar properties in localities where such Person
operates.

      

      Section 4.15.
OFAC.  The
Borrower (i) is not a person whose property or interest in property is
blocked or subject to blocking pursuant to Section 1 of Executive Order
13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079
(2001)), (ii) does not engage in any dealings or transactions prohibited by
Section 2 of such executive order, or is otherwise associated with any such
person in any manner violative of Section 2 or (iii) is not a person
on the list of Specially Designated Nationals and Blocked Persons or subject to
the limitations or prohibitions under any other U.S. Department of Treasury’s
Office of Foreign Assets Control regulation or executive order.

      

      Section 4.16.
Patriot
Act.  The
Borrower is in compliance, in all material respects, with (i) the Trading
with the Enemy Act, as amended, and each of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) and any other enabling legislation or executive order
relating thereto and (ii) the Uniting And Strengthening America By
Providing Appropriate Tools Required To Intercept And Obstruct Terrorism (USA
Patriot Act of 2001).  No part of the proceeds of the Loans will be
used, directly or indirectly, for any payments to any governmental official or
employee, political party, official of a political party, candidate for
political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as
amended.

      

      Section 4.17.
Solvency.  After
giving effect to the execution and delivery of the Loan Documents and the making
of all Loans under this Agreement, the Borrower will not be “insolvent,” within
the meaning of such term as defined in § 101(32) of Title 11 of the United
States Code, as amended from time to time, or be unable to pay its debts
generally as such debts become due, or have an unreasonably small capital to
engage in any business or transaction, whether current or
contemplated.

      

      
        
          
          

        

        
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      ARTICLE V. COVENANTS

      

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

      

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

      

      (a)           as
soon as available and in any event within 90 days after the end of each fiscal
year of the Parent, a copy of the annual audited report for such fiscal year for
the Parent and its Subsidiaries, containing (i) a consolidated and
consolidating balance sheet and the related consolidated and consolidating
statements of income, of changes in shareholders’ equity and of cash flows
(together with all footnotes thereto), and (ii) a condensed balance sheet
of the Parent only and the related condensed statements of income and of cash
flows, setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail and reported on by Porter Keadle
Moore, LLP or other independent public accountants of nationally recognized
standing (without a “going concern” or like qualification, exception or
explanation and without any qualification or exception as to scope of such
audit) to the effect that such financial statements present fairly in all
material respects the financial condition and the results of operations and cash
flows on a consolidated and consolidating basis of the Parent for such fiscal
year in accordance with GAAP and that the examination by such accountants in
connection with such financial statements has been made in accordance with
generally accepted auditing standards; provided, that the requirements set forth
in this clause (a), other than the certification of the Parent’s certified
public accountants set forth in clause (ii) above, may be fulfilled by providing
to the Administrative Agent and the Lenders the report of the Parent to the
Securities and Exchange Commission (or any successor thereto) on Form 10-K for
the applicable fiscal year;

      

      (b)           as
soon as available and in any event within 45 days after the end of each of the
first three Fiscal Quarters of each fiscal year of the Parent, an unaudited
balance sheet of the Parent and its Subsidiaries on a consolidated and
consolidating basis and of the Parent on a stand alone basis as of the end of
such Fiscal Quarter and the related unaudited statements of income and cash
flows of the Parent and its Subsidiaries on a consolidated and consolidating basis
and of the Parent on a stand alone basis, each for such Fiscal Quarter and the
then elapsed portion of such fiscal year, setting forth in each case in
comparative form the figures for the corresponding quarter and the corresponding
portion of the Parent’s previous fiscal year, all certified by the chief
financial officer or treasurer of the Parent as
presenting fairly in all material respects the financial condition and results
of operations of the Parent and its Subsidiaries on a consolidated and
consolidating basis and of the Parent on a stand alone basis in accordance with
GAAP, subject to normal year-end audit adjustments and the absence of footnotes;
provided, that
the requirements set forth in this clause (b) with respect to the financial
information of the Parent and its Subsidiaries on a consolidated and
consolidating basis may be fulfilled by providing to the Administrative Agent
and the Lenders the report of the Parent to the Securities and Exchange
Commission (or any successor thereto) on Form 10-Q for the applicable fiscal
quarter and with respect to the financial information of the Parent on a stand
alone basis may be fulfilled by the delivery of the Parent’s FRY-9LP Report for
such fiscal quarter;

       

      
        
          
          

        

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

      

      (d)           promptly
after the same become publicly available, copies of all Form 8-Ks, proxy
statements and other materials filed with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all functions of
said Commission, or with any national securities exchange, or distributed by the
Parent to its shareholders generally, as the case may be (to the extent not
otherwise required to be delivered to the Administrative Agent or the Lenders
hereunder);

      

      (e)           immediately
after receiving knowledge thereof, written notice of all charges, assessments,
actions, suits and proceedings (as well as notice of the outcome of any such
charges, assessments, orders, actions, suits and proceedings) that are proposed
or initiated by, or brought before, any court or Governmental Authority, in
connection with the Parent or any of its Subsidiaries (including the Borrower),
other than ordinary course of business litigation or proceedings which, if
adversely decided, could not reasonably be expected to have a Material Adverse
Effect; provided, however, that nothing
in this Section shall require the Borrower to provide notice of such charges,
assessments, actions, suits or proceedings to the extent that providing such
notice would be prohibited by 12 C.F.R. § 350.9.; and

      

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

      

      Documents
required to be delivered pursuant to Section 5.1(a)
or (b) or Section 5.1(d)
(to the extent any such documents are included in materials otherwise filed with
the Securities and Exchange Commission) may be delivered electronically and if
so delivered, shall be deemed to have been delivered on the date (i) on
which the Borrower or the Parent posts such documents or provides a link thereto
on the Borrower’s or the Parent’s website on the internet at the website address
set forth in Section 8.1 or
(ii) on which such documents are posted on the Borrower’s internet or
intranet website, if any, to which the Administrative Agent and each Lender have
access; provided, that
(A) the Borrower shall deliver paper copies of such documents to the
Administrative Agent or any Lender and (B) the Borrower shall notify (which
may be by facsimile or electronic mail) the Administrative Agent and each Lender
of the posting of any such documents and provide to the Administrative Agent and
each Lender by electronic mail electronic versions (i.e. soft copies) of such
documents, if so requested until a written notice is received by the Borrower
from the Administrative Agent or such Lender to cease delivering such paper and
electronic copies.

       

      
        
          
          

        

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

      

      (a)           the
occurrence of any Event of Default;

      

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

      

      (c)           the
occurrence of any ERISA Event that alone, or together with any other ERISA
Events that have occurred, could reasonably be expected to result in liability
of the Borrower or its Subsidiaries in an aggregate amount exceeding
$750,000;

      

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

      

      (e)           the
issuance of any cease and desist order or the receipt of any oral notification
that a cease and desist order will be forthcoming, written agreement,
cancellation of insurance or other public or enforcement action by the FDIC or
other Governmental Authority having regulatory authority over the Parent or any
of its Subsidiaries (including the Borrower);

      

      (f)           the
issuance of any informal enforcement action, including, without limitation, a
memorandum of understanding, or proposed disciplinary action by or from any
Governmental Authority having regulatory authority over the Parent or any of its
Subsidiaries (including the Borrower), to the extent that such Person is
permitted to disclose such information (provided that the Borrower shall, and
shall cause any such Person to, take all reasonable efforts to obtain any
necessary regulatory consents); and

      

      (g)           any
other development that results in, or could reasonably be expected to result in,
a Material Adverse Effect.

      

      Each notice delivered under this
Section shall be accompanied by a written statement of a Responsible
Officer setting forth the details of the event or development requiring such
notice and any action taken or proposed to be taken with respect
thereto.

      

      Section 5.3.
Existence;
Conduct of Business.  The
Borrower will do or cause to be done all things necessary to preserve, renew and
maintain in full force and effect its legal existence and its respective rights,
licenses, permits, privileges, franchises, patents, copyrights, trademarks and
trade names material to the conduct of its business and will continue to engage
in the same business as presently conducted or such other businesses that are
closely related thereto.

       

      
        
          
          

        

        
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      Section 5.4.
Compliance with
Laws, Etc. 

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

      

      Section 5.5.
Payment of
Obligations.  The
Borrower will pay and discharge at or before maturity, all of its obligations
and liabilities (including without limitation all tax liabilities and all claims
that could result in a statutory lien) before the same shall become delinquent
or in default, except where (a) the validity or amount thereof is being
contested in good faith by appropriate proceedings, (b) the Borrower has set
aside on its books adequate reserves with respect thereto in accordance with
GAAP and (c) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect.

      

      Section 5.6.
Books and
Records.  The
Borrower will keep proper books of record and
account in which full, true and correct entries shall be made of all dealings
and transactions in relation to its business and activities to the extent
necessary to prepare the consolidated and consolidating financial statements of
Borrower in conformity with GAAP.

      

      Section 5.7.
Visitation,
Inspection, Etc. 

        Subject
to Section 8.10,
the Borrower will permit any representative of the Administrative Agent and of
each Lender to visit and inspect its properties, to examine its books and
records and to make copies and take extracts therefrom, and to discuss its
affairs, finances and accounts with any of its officers and with its independent
certified public accountants, all at such reasonable times and as often as the
Administrative Agent or such Lender may reasonably request after reasonable
prior notice to the Borrower; provided, however, that nothing
in this Section shall require the Borrower to permit the inspection of exam
reports and other supervisory materials to the extent such inspection would be
prohibited by 12 C.F.R. § 350.9.

      

      Section 5.8.
Maintenance of
Properties; Insurance.

      

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

      

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

       

      
        
          
          

        

        
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      Section 5.9.
Use of
Proceeds.  The
Borrower will use the proceeds of all Loans to finance working capital needs and
for other general corporate purposes of the Borrower.  No part of the
proceeds of any Loan will be used, whether directly or indirectly, for any
purpose that would violate any rule or regulation of the FRB, including
Regulation T, U or X.

      

      Section 5.10.
Subordination
of Loans.  If
the Loans (or any of them) cease to be deemed to be Tier 2 Capital other than
due to the limitation imposed by the second sentence of 12 C.F.R. Part 325, App.
A(I)(A)(2)(e), which limits the capital treatment of subordinated debt during
the five years immediately preceding the maturity date of the subordinated debt,
the Borrower shall: (a) immediately notify the Administrative Agent and the
Lenders; and (b) immediately upon request of the Administrative Agent or the
Required Lenders execute and deliver all such agreements (including, without
limitation, replacement notes) as the Administrative Agent or the Required
Lenders may reasonably request in order to restructure the obligations evidenced
by the Loans as a senior obligations of the Borrower.

      

      ARTICLE VI.EVENTS
OF DEFAULT

      

      Section 6.1.
Events of
Default.  If
any of the following events (each an “Event of Default”)
shall occur (whatever
the reason for such event and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of any
court or any decree, order, rule or regulation of any Governmental
Authority):

      

      (a)           the
Borrower shall fail to pay any principal of, or interest on, any Loan when and
as the same shall become due and payable, whether at the due date thereof or at
a date fixed for prepayment or otherwise, and such failure shall continue
unremedied for a period of fifteen (15) days; or

      

      (b)           the
Borrower shall fail to pay any indebtedness for borrowed money (other than under
this Agreement) in excess of the greater of (i) $250,000 and (ii) 5.0% of the
capital of the Borrower (such greater amount, a “Material Amount”),
when and as the same shall become due and payable (whether at scheduled
maturity, required prepayment, acceleration, demand or otherwise), and such
failure shall continue after the applicable grace period, if any, specified in
the agreement or instrument evidencing such indebtedness; or

      

      (c)           any final judgment or order
for the payment of money in excess of a Material Amount shall be rendered
against the Borrower and the Borrower shall fail to pay such amount within the
time period required to be so paid; or

      

      (d)           the
Borrower shall consent to the appointment of a receiver, conservator,
liquidator, trustee or other similar official in any receivership, liquidation,
readjustment of debts, insolvency or similar proceeding with respect to the
Borrower or all or substantially all of the property of the Borrower;
or

       

      
        
          
          

        

        
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      (e)           a
Governmental Authority having jurisdiction in the premises shall enter a decree
or order for the appointment of a receiver, conservator, liquidator, trustee or
other similar official of the Borrower in any receivership, liquidation,
readjustment of debts, insolvency or similar proceeding with respect to the
Borrower or all or substantially all of the property of the Borrower, or for the
winding up or liquidation of the affairs or business of the Borrower;
or

      

      (f)           the
Borrower shall admit in writing its inability to pay its debts as they become
due; or

      

      (g)           the
Borrower shall fail to observe or perform any covenant or agreement contained in
Article V of this Agreement and such failure shall remain unremedied for
30 days;

      

      then, and
in every such event (other than an event with respect to the Borrower described
in clause (d), (e) or (f) of this Section) and at any time thereafter during the
continuance of such event, the Administrative Agent may, and upon the written
request of the Required Lenders shall, by notice to the Borrower, take any or
all of the following actions, at the same or different times: (i) declare
the principal of and any accrued interest on the Loans, and all other
obligations owing hereunder, to be, whereupon the same shall become due and
payable immediately, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower and (ii) exercise all
remedies contained in any other Loan Document; and that, if an Event of Default
specified in clause (d), (e) or (f) shall occur, the principal of the Loans then
outstanding, together with accrued interest thereon, and all fees, and all other
obligations hereunder shall automatically become due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower.

      

      ARTICLE VII. 
THE
ADMINISTRATIVE AGENT

      

      Section 7.1.
Appointment of
Administrative Agent.  Each
Lender irrevocably appoints SunTrust Bank as the Administrative Agent and
authorizes it to take such actions on its behalf and to exercise such powers as
are delegated to the Administrative Agent under this Agreement and the other
Loan Documents, together with all such actions and powers that are reasonably
incidental thereto.  The Administrative Agent may perform any of its
duties hereunder by or through any one or more sub-agents appointed by the
Administrative Agent.  The Administrative Agent and any such sub-agent
may perform any and all of its duties and exercise its rights and powers through
any affiliate thereof.  The exculpatory provisions set forth in this
Article shall apply to any such sub-agent and any affiliate of the
Administrative Agent and any such sub-agent and shall apply to their respective
activities in connection with the syndication of the credit facilities provided
for herein as well as activities as Administrative Agent.

      

      Section 7.2.
Nature of
Duties of Administrative Agent.  The
Administrative Agent shall not have any duties or obligations except those
expressly set forth in this Agreement and the other Loan
Documents.  Without limiting the generality of the foregoing,
(a) the Administrative Agent shall not be subject to any fiduciary or other
implied duties, regardless of whether an Event of Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take
any discretionary action or exercise any discretionary powers, except those
discretionary rights and powers expressly contemplated by the Loan Documents
that the Administrative Agent is required to exercise in writing by the Required
Lenders (or such other number or percentage of the Lenders as shall be necessary
under the circumstances as provided in Section 8.2),
and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any of its Subsidiaries that is communicated to or obtained by the
Administrative Agent or any of its affiliates in any capacity.  The
Administrative Agent shall not be li­able for any action taken or not taken
by it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 8.2) or
in the absence of its own gross negli­gence or willful
misconduct.  The Administrative Agent shall not be deemed to have
knowledge of any Event of Default unless and until written notice thereof is
given to the Administrative Agent by the Borrower or any Lender, and the
Administrative Agent shall not be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with any Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements, or other terms and conditions set forth in any Loan
Document, (iv) the validity, enforceability, effectiveness or genuineness
of any Loan Document or any other agreement, instrument or document, or
(v) the satisfaction of any condition set forth in Article III or
elsewhere in any Loan Document, other than to confirm receipt of items expressly
required to be delivered to the Administrative Agent.

       

      
        
          
          

        

        
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      Section 7.3.
Lack of
Reliance on the Administrative Agent.  Each
of the Lenders acknowledges that it has, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement.  Each of the Lenders also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, continue to make its own decisions in
taking or not taking of any action under or based on this Agreement, any related
agreement or any document furnished hereunder or thereunder.

      

      Section 7.4.
Certain Rights
of the Administrative Agent.  If
the Administrative Agent shall request instructions from the Required Lenders
with re­spect to any action or ac­tions (including the failure to act)
in connection with this Agreement, the Administrative Agent shall be entitled to
refrain from such act or taking such act, unless and until it shall have
received instructions from such Lend­ers; and the Administrative Agent shall
not incur liability to any Person by rea­son of so
refraining.  Without limiting the foregoing, no Lender shall have any
right of action whatsoever against the Administrative Agent as a result of the
Administrative Agent acting or refraining from acting hereunder in
ac­cordance with the instructions of the Required Lenders where required by
the terms of this Agreement.

       

      
        
          
          

        

        
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      Section 7.5.
Reliance by
Administrative Agent.  The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed, sent or made by the proper Person.  The
Administrative Agent may also rely upon any statement made to it orally or by
telephone and believed by it to be made by the proper Person and shall not incur
any liability for relying thereon.  The Administrative Agent may
consult with legal counsel (including counsel for the Borrower),
indepen­dent public accountants and other experts selected by it and shall
not be liable for any action taken or not taken by it in accordance with the
advice of such counsel, accountants or experts.

      

      Section 7.6.
The
Administrative Agent in its Individual Capacity.  The
bank serving as the Administrative Agent shall have the same rights and powers
under this Agreement and any other Loan Document in its capacity as a Lender as
any other Lender and may exercise or refrain from exercising the same as though
it were not the Administrative Agent; and the terms “Lenders”, “Required
Lenders”, “holders of Notes”, or any similar terms shall, unless the context
clearly otherwise indicates, include the Administrative Agent in its individual
capacity.  The bank acting as the Administrative Agent and its
affiliates may accept de­posits from, lend money to, and generally engage in
any kind of business with the Borrower or any Subsidiary or affiliate of the
Borrower as if it were not the Administrative Agent hereunder.

      

      Section 7.7.
Successor
Administrative Agent.

      

      (a)           The
Administrative Agent may resign at any time by giving notice thereof to the
Lenders and the Borrower.  Upon any such resignation, the Required
Lenders shall have the right to appoint a successor Administrative Agent,
subject to the approval by the Borrower provided that no Event of Default shall
exist at such time.  If no suc­cessor Administrative Agent shall
have been so appointed, and shall have accepted such appointment within
30 days after the retiring Administrative Agent gives notice of
resignation, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent, which shall be a commercial
bank organized under the laws of the United States of America or any state
thereof or a bank which maintains an office in the United States.

      

      (b)           Upon
the acceptance of its appointment as the Administrative Agent hereunder by a
successor, such successor Administrative Agent shall there­upon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations under this Agreement and the other
Loan Documents.  If within 30 days after written notice is given of
the retiring Administrative Agent’s resignation under this Section 7.7 no
successor Administrative Agent shall have been appointed and shall have accepted
such appointment, then on such 30th day
(i) the retiring Administrative Agent’s resignation shall become effective,
(ii) the retiring Administrative Agent shall thereupon be discharged from
its duties and obligations under the Loan Documents and (iii) the Required
Lenders shall thereafter perform all duties of the retiring Administrative Agent
under the Loan Documents until such time as the Required Lenders appoint a
successor Administrative Agent as provided above.  After any
retir­ing Administrative Agent’s resignation hereunder, the provi­sions
of this Article VII
shall continue in effect for the benefit of such retiring Administrative Agent
and its representatives and agents in respect of any ac­tions taken or not
taken by any of them while it was serving as the Administrative
Agent.

       

      
        
          
          

        

        
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      ARTICLE VIII.   
MISCELLANEOUS

      

      Section 8.1. Notices.

      

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

       

      
        	 	To the
      Borrower: 	United Community
      Bank	 	 
	 	 	63 Highway
    515	 	 
	 	 	Blairsville, Georgia
      30514	 	 
	 	 	Attn:  Rex S.
      Schuette	 	 
	 	 	Telephone
      Number:  (706) 781-2265	 	 
	 	 	Fax
      Number:              
      (706) 745-9046	 	 
	 	 	Internet Website:
      www.ucbi.com	 	 

      

       

       

      
        
          	 	To the
      Administrative Agent: 	SunTrust Bank,
      Agency Services	 	 
	 	 	303 Peachtree
      Street, 25th
      Floor	 	 
	 	 	Atlanta, Georgia
      30308	 	 
	 	 	Attn:  Debra
      Rivers	 	 
	 	 	
                  Telephone
      Number:  (404) 532-0432

                	 	 
	 	 	Fax
      Number:              
      (404) 253-8366	 	 

        

         

      

      

      
        	
                Any
      party hereto may change its address or facsimile number for notices and
      other communications hereunder by notice to the other parties
      hereto.  All such notices and other communications shall, when
      transmitted by overnight delivery, or faxed, be effective when delivered
      for overnight (next-day) delivery, or transmitted in legible form by
      facsimile machine, respectively, or if mailed, upon the third Business Day
      after the date deposited into the mails or if hand delivered, upon
      delivery.

              

      

      

      (b)           Any
agreement of the Administrative Agent and the Lenders herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of the Borrower.  The Administrative Agent and the Lenders
shall be entitled to rely on the authority of any Person purporting to be a
Person authorized by the Borrower to give such notice, and the Administrative
Agent shall not have any liability to the Borrower or other Person on account of
any action taken or not taken by the Administrative Agent or the Lenders in
reliance upon such telephonic or facsimile notice.  The obligation of
the Borrower to repay the Loans and all other obligations hereunder shall not be
affected in any way or to any extent by any failure of the Administrative Agent
or the Lenders to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Administrative Agent or the Lenders of a
confirmation which is at variance with the terms understood by the
Administrative Agent or the Lenders to be contained in any such telephonic or
facsimile notice.

      

      
        
          
          

        

        
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      Section 8.2. 
Waiver;
Amendments.

      

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

      

      (b)           No
amendment or waiver of any provision of this Agreement or the other Loan
Documents, nor consent to any departure by the Borrower therefrom, shall in any
event be effective unless the same shall be in writing and signed by the
Borrower and the Required Lenders, or the Borrower and the Administrative Agent
with the consent of the Required Lenders, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, that no
amendment or waiver shall: (i) increase the Commitment of any Lender
without the written consent of such Lender, (ii) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iii) extend the Maturity Date or otherwise postpone the date fixed for any
payment of any principal of, or interest on, any Loan or interest thereon or any
fees hereunder or reduce the amount of, waive, forgive or excuse any such
payment, without the written consent of each Lender affected thereby,
(iv) change Section 2.15(b)
or Section 2.15(c)
in a manner that would alter the pro rata sharing of payments required thereby,
without the written consent of each Lender, (v) change any of the
provisions of this Section 8.2 or
the definition of “Required Lenders” or any other provision hereof specifying
the number or percentage of Lenders which are re­quired to waive, amend or
modify any rights hereunder or make any determination or grant any consent
hereunder, without the consent of each Lender; (vi) release any guarantor,
if any, or limit the liability of any such guarantor under any guaranty
agreement; provided
further, that no such agreement shall amend, modify or otherwise affect
the rights, duties or obligations of the Administrative Agent without the prior
written consent of such Person.  Notwithstanding anything herein or
otherwise to the contrary, any Event of Default occurring hereunder shall
continue to exist (and shall be deemed to be continuing) until such time as such
Event of Default is waived in writing in accordance with the terms of this
Section notwithstanding (i) any attempted cure or other action taken by the
Borrower or any other Person subsequent to the occurrence of such Event of
Default or (ii) any action taken or omitted to be taken by the Administrative
Agent or any Lender prior to or subsequent to the occurrence of such Event of
Default (other than the granting of a waiver in writing in accordance with the
terms of this Section).

       

      
        
          
          

        

        
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      Section 8.3. 
Expenses;
Indemnification.

      

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

      

      (b)           The
Borrower shall indemnify the Administrative Agent and each Lender and each
officer, director, employee, agents, advisors and affiliates of the
Administrative Agent and each Lender (each, an “Indemnitee”)
against, and hold each of them harmless from, any and all costs, losses,
liabilities, claims, damages and related expenses, including the fees, charges
and disbursements of any counsel for any Indemnitee, which may be incurred by
any Indemnitee, or asserted against any Indemnitee by the Borrower or any third
Person, arising out of, in connection with or as a result of (i) the
execution or delivery of any this Agreement or any other agreement or instrument
contemplated hereby, the performance by the parties hereto of their respective
obligations hereunder or the consummation of any of the transactions
contemplated hereby, (ii) any Loan or any actual or proposed use of the
proceeds therefrom, (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned by the Borrower or any
Subsidiary or any Environmental Liability related in any way to the Borrower or
any Subsidiary or
(iv) any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing, whether brought by the Borrower or
any third Person and whether based on contract, tort, or any other theory and
regardless of whether any Indemnitee is a party thereto; provided, that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a court of
competent jurisdiction in a final and nonappealable judgment to have resulted
from the gross negligence or willful misconduct of such Indemnitee.

       

      
        
          
          

        

        
          - 38
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      (c)           The
Borrower shall pay, and hold the Administrative Agent and each of the Lenders
harmless from and against, any and all present and future stamp, documentary,
and other similar taxes with respect to this Agreement and any other Loan
Documents, or any payments due thereunder, and save the Administrative Agent and
each of the Lenders harmless from and against any and all liabilities with
respect to or resulting from any delay or omission to pay such
taxes.

      

      (d)           To
the extent that the Borrower fails to pay any amount required to be paid to the
Administrative Agent under clauses (a), (b) or (c) hereof, each Lender severally
agrees to pay to the Administrative Agent such Lender’s Pro Rata Share
(determined as of the time that the unreimbursed expense or indemnity payment is
sought) such unpaid amount; provided, that the
unreimbursed expense or indemnified payment, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent in its capacity as such.

      

      (e)           TO
THE EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER SHALL NOT ASSERT, AND
HEREBY WAIVES, ANY CLAIM AGAINST ANY INDEMNITEE, ON ANY THEORY OF LIABILITY, FOR
SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO ACTUAL OR
DIRECT DAMAGES) ARISING OUT OF, IN CONNECTION WITH OR AS A RESULT OF, THIS
AGREEMENT OR ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY, THE TRANSACTIONS
CONTEMPLATED THEREIN, ANY REVOLVING LOAN OR THE USE OF PROCEEDS
THEREOF.

      

      (f)           All
amounts due under this Section shall be payable promptly after written
demand therefor.

      

      Section 8.4. 
Successors
and Assigns.

      

      (a)           The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights hereunder without the
prior written consent of each Lender (and any attempted assignment or transfer
by the Borrower without such consent shall be null and void).

       

      
        
          
          

        

        
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      (b)           Any
Lender may at any time assign to one or more assignees all or a portion of its
rights and obligations under this Agreement and the other Loan Documents; provided, that
(i) except in the case of an assignment to a Lender or an affiliate of a
Lender or to a fund managed by a Lender or an affiliate of a Lender, each of the
Borrower and the Administrative Agent must give their prior written consent
(which consent shall not be unreasonably withheld or delayed), provided, that the
consent of the Borrower shall not be required during the existence of an Event
of Default, (ii) except in the case of an assignment to a Lender or an
affiliate of a Lender or to a fund managed by a Lender or an affiliate of a
Lender or an assignment of the entire amount of the assigning Lender’s
Loans or an
assignment while an Event of Default has occurred and is continuing, the amount
of the Loans of the assigning Lender subject to each such assignment (determined
as of the date the assignment and acceptance agreement with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$1,000,000 (unless the Borrower and the Administrative Agent shall otherwise
consent), (iii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations under
this Agreement and the other Loan Documents, (iv) the assigning Lender and
the assignee shall execute and deliver to the Administrative Agent an assignment
and acceptance agreement in form and substance acceptable to the Administrative
Agent, together with a processing and recordation fee payable by the
assigning Lender or the assignee (as determined between such Persons) in an
amount equal to $3,500 and (v) such
assignee, if it is not a Lender, shall deliver a duly completed Administrative
Questionnaire to the Administrative Agent; provided, that any
consent of the Borrower otherwise required hereunder shall not be required if an
Event of Default has occurred and is continuing.  Upon the execution
and delivery of the such assignment and acceptance agreement and payment by such
assignee to the assigning Lender of an amount equal to the purchase price agreed
between such Persons, such assignee shall become a party to this Agreement and
any other Loan Documents to which such assigning Lender is a party and, to the
extent of such interest assigned by such assignment and acceptance agreement,
shall have the rights and obligations of a Lender under this Agreement, and the
assigning Lender shall be released from its obligations hereunder to a
corresponding extent (and, in the case of an assignment and acceptance agreement
covering all of the assigning Lender’s rights and obligations under this
Agreement, such Lender shall cease to be a party hereto but shall continue to be
entitled to the benefits of Section 2.11,
Section 2.12,
Section 2.13 and
Section 8.3).  Upon
the consummation of any such assignment hereunder, the assigning Lender, the
Administrative Agent and the Borrower shall make appropriate arrangements to
have new promissory notes issued if so requested by either or both the assigning
Lender or the assignee.  Any assignment or other transfer by a Lender
that does not fully comply with the terms of this clause (b) shall be
treated for purposes of this Agreement as a sale of a participation pursuant to
clause (c) below.

      

      (c)           Each
Lender may at any time, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a “Participant”) in all
or a portion of such Lender’s rights and obligations under this Agreement; provided, that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the performance
of its obligations hereun­der, and (iii) the Borrower shall continue to
deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement and the other Loan
Documents.  Any agreement between such Lender and the Participant with
respect to such participation shall provide that such Lender shall retain the
sole right and responsibility to enforce this Agreement and the other Loan
Documents and the right to approve any amendment, modification or waiver of this
Agreement and the other Loan Documents; provided, that such
participation agreement may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver of
this Agreement described in the first proviso of Section 8.2(b)
that affects the Participant.  The Borrower agrees that each
Participant shall be entitled to the benefits Section 2.11,
Section 2.12 and
Section 2.13 to
the same extent as if it were a Lender hereunder and had acquired its interest
by assignment pursuant to paragraph (b); provided, that (x) no
Participant shall be entitled to receive any greater payment under Section 2.13 than
such Lender would have been entitled to receive with respect to the
participation sold to such Participant unless the sale of such participation is
made with the Borrower’s prior written consent and (y) no Lender shall be
entitled to receive compensation under Section 2.12 or
Section 2.13 on
the portion of its Loans in which it has sold a participation pursuant to this
paragraph (c) to the extent its Participant has requested the same compensation
as provided in this Section.

       

      
        
          
          

        

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

      

      Section 8.5. 
Governing
Law; Jurisdiction; Consent to Service of Process.

      

      (a)           THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF) OF THE STATE OF GEORGIA.

      

      (b)           The
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the non-exclusive jurisdiction of any Federal and/or state court
located in the State of Georgia and any appellate court from any thereof, in any
action or proceeding arising out of or relating to this Agreement or any other
Loan Document or the transactions contemplated hereby or thereby, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such Georgia state
court or, to the extent permitted by applicable law, such Federal
court.  Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law.  Nothing in this Agreement or any other Loan Document shall
affect any right that the Lenders may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against the
Borrower or its properties in the courts of any jurisdiction.

       

      
        
          
          

        

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

      

      (d)           Each
party to this Agreement irrevocably consents to the service of process in the
manner provided for notices in Section 8.1.  Nothing
in this Agreement or in any other Loan Document will affect the right of any
party hereto to serve process in any other manner permitted by law.

      

      Section 8.6. 
WAIVER OF JURY
TRIAL.  EACH
PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY
OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR
ANY OTHER THEORY).

      

      Section 8.7. 
Counterparts;
Integration.  This
Agreement may be executed by one or more of the parties to this Agreement on any
number of separate counterparts (including by facsimile), and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.  This Agreement, the other Loan Documents, and any
separate letter agreement(s) relating to any fees payable to the Administrative
Agent constitute the entire agreement among the parties hereto and thereto
regarding the subject matters hereof and thereof and supersede all prior
agreements and understandings, oral or written, regarding such subject
matters.

      

      Section 8.8. 
Survival.  All
covenants, agreements, representations and warranties made by the Borrower
herein and in the certificates or other instruments delivered in connection with
or pursuant to this Agreement shall be considered to have been relied upon by
the other parties hereto and shall survive the execution and delivery of this
Agreement and the making of any Loans, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent or any Lender may have had notice or knowledge of any
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid and so long as the Commitment has
not expired or terminated.  The provisions of Section 2.13 and
Section 8.3
shall survive and remain in full force and effect regardless of the consummation
of the transactions contemplated hereby, the repayment of the Loans, the
expiration or termination of the Commitment or the termination of this Agreement
or any provision hereof.  All representations and warranties made
herein, in the certificates, reports, notices, and other documents delivered
pursu­ant to this Agreement shall survive the execution and delivery of this
Agreement and the other Loan Documents, and the making of the
Loans.

       

      
        
          
          

        

        
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      Section 8.9.
Severability.  Any
provision of this Agreement or any other Loan Document held to be illegal,
invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be
ineffective to the extent of such illegality, invalidity or unenforceability
without affecting the legality, validity or enforceability of the remaining
provisions hereof or thereof; and the illegality, invalidity or unenforceability
of a particular provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

      

      Section 8.10.
Confidentiality.  Each
of the Administrative Agent and each Lender agrees to take normal and reasonable
precautions to maintain the confidentiality of any information designated in
writing as confidential and provided to it by the Borrower or any Subsidiary,
except that such information may be disclosed (i) to any officer, director,
agent, affiliate or representative of the Administrative Agent or any such
Lender, including without limitation accountants, legal counsel and other
advisors, (ii) to the extent required by applicable laws or regulations or
by any subpoena or similar legal process, (iii) to the extent requested by
any regulatory agency or authority, (iv) to the extent that such
information becomes publicly available other than as a result of a breach of
this Section, or which becomes available to the Administrative Agent or any
Lender on a nonconfidential basis from a source other than the Borrower,
(v) in connection with the exercise of any remedy hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (vi) subject to provisions substantially similar to this Section 8.10, to
any actual or prospective assignee or Participant, or (vii) with the
consent of the Borrower.  Any Person required to maintain the
confidentiality of any information as provided for in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
information as such Person would accord its own confidential
information.

      

      Section 8.11.
Interest Rate
Limitation.  Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which may be treated
as interest on such Loan under applicable law (collectively, the “Charges”),
shall exceed the maximum lawful rate of interest (the “Maximum
Rate”) which may be contracted for, charged, taken, received or reserved
by a Lender holding such Loan in accordance with applicable law, the rate of
interest payable in respect of such Loan hereunder, together with all Charges
payable in respect thereof, shall be limited to the Maximum Rate and, to the
extent lawful, the interest and Charges that would have been payable in respect
of such Loan but were not payable as a result of the operation of this
Section shall be cumulated and the interest and Charges payable to such
Lender in respect of other Loans or periods shall be increased (but not above
the Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Rate to the date of repayment, shall have been
received by such Lender.

      

      
        
          
          

        

        
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      Section 8.12.
Waiver of
Effect of Corporate Seal.  The
Borrower represents and warrants that it is not required to affix its corporate
seal to this Agreement or any other Loan Document pursuant to any requirement of
law or regulation, agrees that this Agreement is delivered by Borrower under
seal and waives any shortening of the statute of limitations that may result
from not affixing the corporate seal to this Agreement or such other Loan
Documents.

      

      Section 8.13.
Patriot
Act.  The
Administrative Agent and each Lender hereby notifies the Borrower that pursuant
to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)) (the “Patriot Act”), it is
required to obtain, verify and record information that identifies the Borrower,
which information includes the name and address of the Borrower and other
information that will allow such Lender or the Administrative Agent, as
applicable, to identify the Borrower in accordance with the Patriot
Act.  The Borrower shall, and shall cause each of its Subsidiaries to,
provide to the extent commercially reasonable, such information and take such
other actions as are reasonably requested by the Administrative Agent or any
Lender in order to assist the Administrative Agent and the Lenders in
maintaining compliance with the Patriot Act.

      

      Section 8.14.
Bookrunner and
Lead Arranger.  The Lead Arranger
and the Sole Bookrunner listed on the cover page of this Agreement shall not
have any duties or responsibilities hereunder in their capacities as
such.

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

      

      
        
          	 	UNITED COMMUNITY
      BANK	 
	 	 	 	 
	
                   

                	
                  By:
      

                	/s/
      Rex S. Schuette	 
	 	 	Name:
      Rex S.
      Schuette	 
	 	 	Title:  EVP and
      Chief Financial Officer 	 
	 	 	 	 

        

      

                                                             

      
        
          
          

        

        
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          	 	SUNTRUST BANK	 
	 	as
      Administrative Agent and a Lender	 
	 	 	 	 	 
	
                   

                	By:	
                  /s/ K. Scott Bazemore

                	 
	 	 	
                  Name:

                	K. Scott Bazemore	 
	 	 	
                  Title:

                	Vice President	 
	 	 	 	 	 

        

      

                                                                   

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      [SIGNATURE
PAGE TO SUBORDINATED TERM LOAN AGREEMENT

      WITH
UNITED COMMUNITY BANK]

       

      
        
          
          

        

        
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        	 	SILVERTON BANK,
    NA	 
	 	as
      a Lender	 
	 	 	 	 	 
	
                 

              	
                By:
      

              	
                /s/ Christophe Roussel

              	 
	 	 	
                Name:

              	Christophe Roussel	 
	 	 	
                Title:

              	Vice President	 
	 	 	 	 	 

      

                                                               

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      [SIGNATURE
PAGE TO SUBORDINATED TERM LOAN AGREEMENT

      WITH
UNITED COMMUNITY BANK]

      

      
        
          
          

        

        
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      EXHIBIT
A

      FORM OF SUBORDINATED TERM
NOTE

      

      THIS OBLIGATION IS NOT A
DEPOSIT AND IT IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION.  THIS OBLIGATION IS UNSECURED, AND IS JUNIOR AND
SUBORDINATE IN RIGHT OF PAYMENT TO ALL SENIOR DEBT OF THE BORROWER, WHETHER NOW
EXISTING OR HEREAFTER CREATED, WHICH SENIOR DEBT INCLUDES ALL INDEBTEDNESS OWED
BY THE BORROWER TO ITS SECURED CREDITORS, ITS GENERAL CREDITORS AND
DEPOSITORS.  THIS OBLIGATION IS INELIGIBLE AS COLLATERAL FOR ANY LOAN
OR EXTENSION OF CREDIT BY THE BORROWER.

      

      

      
        	
                $____________

              	
                [Date]

              
	 
      	 
      
	 
      	 
      

      

      

      FOR VALUE RECEIVED, the undersigned,
UNITED COMMUNITY BANK, a Georgia bank (the “Borrower”), hereby promises to pay to
[name of Lender] (the
“Lender”)
or its registered assigns at the principal office of SunTrust Bank, as
Administrative Agent, or any other office that the Administrative Agent
designates, on the Maturity Date (as defined in the Subordinated Term Loan
Agreement dated as of August 29, 2008 (as the same may be amended, supplemented
or otherwise modified from time to time, the “Credit
Agreement”; all
capitalized terms used herein but not defined herein shall have the respective
meanings given to them as set forth in the Credit Agreement), among the
Borrower, the lenders from time to time a party thereto (including the Lender)
and SunTrust Bank, as Administrative Agent), the principal amount of [amount of such Lender’s Loan]
and no/100 Dollars ($__________________) in lawful money of the United States of
America in immediately available funds, and to pay interest from the date hereof
on the principal amount thereof from time to time outstanding, in like funds, at
said office, at the rate or rates per annum (including post-default rate) as
provided in the Credit Agreement.  In addition, should legal action or
an attorney-at-law be utilized to collect any amount due hereunder, the Borrower
further promises to pay all costs of collection, including the reasonable
attorneys’ fees of the Lender.

      

      All accrued interest shall be payable
at the Administrative Agent’s principal office as provided above on a quarterly
basis in arrears on the last day of each September, December, March and June,
commencing [insert date that is
quarter end following date of Note].  The outstanding unpaid
principal balance of this Subordinated Term Note shall be payable in a single
installment on the Maturity Date. Whenever any payment to be made under this
Subordinated Term Note shall be due on a day that is not a Business Day, such
payment shall be made on the next succeeding Business Day, and such extension of
time shall be included in the computation of interest due upon this Subordinated
Term Note.  The Borrower shall have the right and privilege of
prepaying all or any part of this Subordinated Term Note at any time in
accordance with the terms of the Credit Agreement, subject to (a) the
restrictions on prepayments set forth in Section 2.5(b)
of the Credit Agreement, and (b) Federal Deposit Insurance Corporation (“FDIC”)
approval.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      The
indebtedness of the Borrower evidenced by this Subordinated Term Note, including
the principal and premium, if any, and interest shall be subordinate and junior
in right of payment to its obligations to its depositors, its obligations under
bankers’ acceptances and letters of credit, and its obligations to its other
creditors, including its obligations to the Federal Reserve Bank, FDIC, and any
rights acquired by the FDIC as a result of loans made by the FDIC to the
Borrower or the purchase or guarantee of any of its assets by the FDIC pursuant
to the provisions of 12 USC 1823(c), (d) or (e), whether now outstanding or
hereafter incurred.  In the event of any insolvency, receivership,
conservatorship, reorganization, readjustment of debt, marshaling of assets and
liabilities or similar proceedings or any liquidation or winding up of or
relating to the Borrower, whether voluntary or involuntary, all such obligations
shall be entitled to be paid in full before any payment shall be made on account
of the principal of, or premium, if any, or interest, on this Subordinated Term
Note.  In the event of any such proceedings, after payment in full of
all sums owing on such prior obligations, the holder of this Subordinated Term
Note, together with any obligations of the Borrower ranking on a parity with
this Subordinated Term Note, shall be entitled to be paid from the remaining
assets of the Borrower the unpaid principal hereof and any unpaid premium, if
any, and interest before any payment or other distribution, whether in cash,
property, or otherwise, shall be made on account of any capital stock or any
obligations of the Borrower ranking junior to this Subordinated Term
Note.  Nothing herein shall impair the obligation of the Borrower,
which is absolute and unconditional, to pay the principal of and any premium and
interest on this Subordinated Term Note according to its terms.

      

      Notwithstanding
any other provisions of this Subordinated Term Note or the Credit Agreement,
including specifically those set forth in the sections relating to
subordination, events of default and covenants of the Borrower, it is expressly
understood and agreed that the FDIC or any receiver or conservator of the
Borrower appointed by the FDIC shall have the right in the performance of his
legal duties, and as part of liquidation designed to protect or further the
continued existence of the Borrower or the rights of any parties or agencies
with an interest in, or claim against, the Borrower or its assets, to transfer
or direct the transfer of the obligations of this Subordinated Term Note to any
bank or bank holding company selected by such official which shall expressly
assume the obligation of the due and punctual payment of the unpaid principal,
and interest and premium, if any, on this Subordinated Term Note and the due and
punctual performance of all covenants and conditions; and the completion of such
transfer and assumption shall serve to supersede and void any default,
acceleration or subordination which may have occurred, or which may occur due or
related to such transaction, plan, transfer or assumption, pursuant to the
provisions of this Subordinated Term Note, and shall serve to return the holder
to the same position, other than for substitution of the obligor, it would have
occupied had no default, acceleration or subordination occurred; except that any
interest and principal previously due, other than by reason of acceleration, and
not paid shall, in the absence of a contrary agreement by the holder of this
Subordinated Term Note, be deemed to be immediately due and payable as of the
date of such transfer and assumption, together with the interest from its
original due date at the rate provided for herein.

       

      
        
          
          

        

        
          - 2
-

          
            

          

        

        
          
          

        

      

       

      If this
Subordinated Term Note ceases to be deemed to be Tier 2 Capital of the Borrower
in accordance with the rules and regulations of the FDIC applicable to the
capital status of the subordinated debt of state chartered, non-member banks,
other than due to the limitations imposed by the second sentence of 12 C.F.R
Part 325A(I)(A)(2)(e), which limits the capital treatment of subordinated debt
during the five years immediately preceding the maturity date of the
subordinated debt, the Borrower shall: (a) immediately notify the Administrative
Agent and the Lenders; and (b) immediately upon the request of the
Administrative Agent or the Required Lenders execute and deliver all such
agreements (including without limitation a replacement note for this
Subordinated Term Note) as the Administrative Agent or the Required Lenders may
request in order to restructure the obligation evidenced hereby as a senior
obligation of the Borrower.  If the Borrower fails to execute such
agreements as requested within 30 days of such request, such failure shall be
deemed to be an Event of Default as provided in Section 6.1 of the
Credit Agreement.

      

      By
accepting this Subordinated Term Note, the Lender agrees that, so long as this
Subordinated Term Note is deemed to be Tier 2 Capital, other than due to the
limitation imposed by the second sentence of 12 C.F.R. Part 325, App.
A(I)(A)(2)(e), it waives its right to exercise any set-off or other right to
appropriate and to apply any deposits or other assets of the Borrower at any
time held by such Lender against or on account of amounts owing hereunder to
such Lender.

      

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

      

      Notwithstanding
anything herein or in the Credit Agreement to the contrary, this Subordinated
Term Note is not subject to any sinking fund.

      

      This Subordinated Term Note is issued
in connection with, and is entitled to the benefits of, the Credit Agreement
which, among other things, contains provisions for the acceleration of the
maturity hereof upon the happening of certain events, for prepayment of the
principal hereof prior to the maturity hereof and for the amendment or waiver of
certain provisions of the Credit Agreement, all upon the terms and conditions
therein specified.  THIS SUBORDINATED TERM NOTE SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF GEORGIA (WITHOUT GIVING
EFFECT TO ANY CONFLICT OF LAWS) AND ANY APPLICABLE LAWS OF THE UNITED STATES OF
AMERICA.

      

      
        
          
          

        

        
          - 3
-

          
            

          

        

        
          
          

        

      

       

      
        
          	 	UNITED
      COMMUNITY BANK	 
	 	 	 	 
	
                   

                	
                  By:
      

                	 	 
	 	 	Name:	 
	 	 	 	 
	 	 	 	 

        

      

       

      - 4 -Loan Agreement with Bank of America, N.A. dated June 6, 2008

 Exhibit 10.44 
  
  
  
 LOAN AGREEMENT 
 executed by and
between 
 IMMUNOMEDICS, INC., 
 as the Borrower 
 and 
 BANK OF AMERICA, N.A., 
 as the Bank 
 Dated: June 6, 2008 
  
  
  

 TABLE OF CONTENTS 
  

					
	  	  	 	  	Page
	PREAMBLE AND RECITALS	  	1
			
	 	  	1. LOAN FACILITY: AMOUNT AND TERMS	  	 
			
	 Section 1.1
	  	Amount	  	1
	 Section 1.2
	  	Availability Period; Notice of Borrowing; Tranches	  	3
	 Section 1.3
	  	Repayment Terms	  	4
	 Section 1.4
	  	Interest Rate	  	4
	 Section 1.5
	  	LIBOR Rate Provisions	  	4
	 Section 1.6
	  	Permanent Reduction in Amount of Loan Facility Commitment	  	6
	 Section 1.7
	  	Letters of Credit	  	6
	 Section 1.8
	  	Use of Proceeds of the Loan Facility	  	7
	 Section 1.9
	  	No Annual Cleanup	  	7
			
		  	2. FEES AND EXPENSES	  	
			
	 Section 2.1
	  	Loan Fee	  	7
	 Section 2.2
	  	Unused Commitment Fee	  	7
	 Section 2.3
	  	Late Fee	  	7
	 Section 2.4
	  	Expenses	  	7
	 Section 2.5
	  	Reimbursement Costs	  	7
			
		  	3. COLLATERAL	  	
			
	 Section 3.1
	  	Personal Property	  	7
	 Section 3.2
	  	Real Property	  	8
			
		  	4. DISBURSEMENTS, PAYMENTS AND COSTS	  	
			
	 Section 4.1
	  	Disbursements and Payments	  	8
	 Section 4.2
	  	Telephone and Telefax Authorization	  	9
	 Section 4.3
	  	Direct Debit	  	9
	 Section 4.4
	  	Banking Days	  	9
	 Section 4.5
	  	Interest Calculation	  	9
	 Section 4.6
	  	Default Rate	  	9
			
		  	5. CONDITIONS	  	
			
	 Section 5.1
	  	Authorizations	  	10
	 Section 5.2
	  	Governing Documents	  	10
	 Section 5.3
	  	Security Agreements	  	10
	 Section 5.4
	  	Perfection and Evidence of Priority	  	10
	 Section 5.5
	  	Payment of Fees	  	10
	 Section 5.6
	  	Good Standing	  	10

  

 - 2 - 

					
	 	  	6. REPRESENTATION AND WARRANTIES	  	 
			
	 Section 6.1
	  	Incorporation	  	10
	 Section 6.2
	  	Authorization	  	10
	 Section 6.3
	  	Enforceable Agreement	  	10
	 Section 6.4
	  	Good Standing	  	10
	 Section 6.5
	  	No Conflicts	  	10
	 Section 6.6
	  	Financial Information	  	11
	 Section 6.7
	  	Lawsuits	  	11
	 Section 6.8
	  	Collateral	  	11
	 Section 6.9
	  	Permits, Franchises	  	11
	 Section 6.10
	  	Other Obligations	  	11
	 Section 6.11
	  	Tax Matters	  	11
	 Section 6.12
	  	No Event of Default	  	11
	 Section 6.13
	  	Insurance	  	11
			
		  	7. COVENANTS	  	
			
	 Section 7.1
	  	Use of Proceeds	  	11
	 Section 7.2
	  	Financial Information - Borrower	  	12
	 Section 7.3
	  	Bank as Principal Depository	  	12
	 Section 7.4
	  	Other Debts	  	12
	 Section 7.5
	  	Other Liens	  	13
	 Section 7.6
	  	Maintenance of Assets	  	13
	 Section 7.7
	  	Investments	  	14
	 Section 7.8
	  	Loans	  	14
	 Section 7.9
	  	Change of Management	  	14
	 Section 7.10
	  	Change of Ownership	  	14
	 Section 7.11
	  	Additional Negative Covenants	  	14
	 Section 7.12
	  	Notices to Bank	  	15
	 Section 7.13
	  	Insurance	  	15
	 Section 7.14
	  	Compliance with Laws	  	15
	 Section 7.15
	  	ERISA Plans	  	16
	 Section 7.16
	  	Books and Records	  	16
	 Section 7.17
	  	Audits	  	16
	 Section 7.18
	  	Perfection of Liens	  	16
	 Section 7.19
	  	Cooperation	  	16
	 Section 7.20
	  	Deposits of Cash, Cash Equivalents, or Additional Securities into Collateral Account	  	16
	 Section 7.21
	  	Dividends and Distributions	  	16
			
		  	8. HAZARDOUS SUBSTANCES – REAL PROPERTY SECURITY	  	
			
	 Section 8.1
	  	Indemnity Regarding Hazardous Substances	  	16
	 Section 8.2
	  	Compliance Regarding Hazardous Substances	  	16
	 Section 8.3
	  	Notices Regarding Hazardous Substances	  	17
	 Section 8.4
	  	Definition of Hazardous Substances	  	17

  

 - 3 - 

					
	 	  	9. DEFAULT AND REMEDIES	  	 
			
	 Section 9.1
	  	Failure to Pay	  	17
	 Section 9.2
	  	Other Bank Agreements	  	17
	 Section 9.3
	  	Cross-default	  	17
	 Section 9.4
	  	False Information	  	17
	 Section 9.5
	  	Bankruptcy	  	17
	 Section 9.6
	  	Receivers	  	17
	 Section 9.7
	  	Lien Priority	  	18
	 Section 9.8
	  	Judgments	  	18
	 Section 9.9
	  	Material Adverse Change	  	18
	 Section 9.10
	  	Governmental Action	  	18
	 Section 9.11
	  	ERISA Plans	  	18
	 Section 9.12
	  	Other Breach Under Agreement	  	18
			
		  	10. ENFORCING THIS LOAN AGREEMENT; MISCELLANEOUS	  	
			
	 Section 10.1
	  	GAAP	  	18
	 Section 10.2
	  	Governing Law	  	18
	 Section 10.3
	  	Successors and Assigns	  	18
	 Section 10.4
	  	Dispute Resolution Provision	  	19
	 Section 10.5
	  	Severability; Waivers	  	20
	 Section 10.6
	  	Attorneys’ Fees	  	20
	 Section 10.7
	  	One Agreement	  	21
	 Section 10.8
	  	Indemnification	  	21
	 Section 10.9
	  	Notices	  	21
	 Section 10.10
	  	Headings	  	21
	 Section 10.11
	  	Counterparts	  	21
	 Section 10.12
	  	Disposition of Schedules and Reports	  	21
	 Section 10.13
	  	Confidentiality	  	21
	 Section 10.14
	  	Limitation of Interest and Other Charges	  	22

  

							
				
		 		  	Exhibits	  	
				
	Exhibit “A”	 	-	  	Notice of Borrowing	  	

  

 - 4 - 

 LOAN AGREEMENT 
 THIS LOAN AGREEMENT (hereinafter, as it may be from time to time amended, modified,
extended, renewed, refinanced and/or supplemented, referred to as this “Loan Agreement”), is
made this 6th day of June, 2008 (hereinafter referred to as the “Effective Date”), by and between 
 IMMUNOMEDICS, INC., a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, having an office
located at 300 American Road, Morris Plains, New Jersey 07950 (hereinafter referred to as the “Borrower”), 
 AND 

 BANK OF AMERICA, N.A., a national banking association duly organized and validly existing under the laws of the United States of
America, having an office located at 750 Walnut Avenue, Cranford, New Jersey 07016 (hereinafter referred to as the “Bank”). 
 W I T N E S S E T H: 
 WHEREAS, the Borrower
has requested that the Bank, and the Bank has agreed to, pursuant to the terms, conditions, and provisions of this Loan Agreement and the other documents to be executed in connection herewith, make available to the Borrower, for working capital
purposes and for general corporate purposes, a secured recourse revolving credit loan facility in the maximum principal amount of up to Nine Million and 00/100 ($9,000,000.00) Dollars (hereinafter, as it may be from time to time amended, modified,
extended, renewed, refinanced, and/or supplemented, referred to as “Loan Facility”), which maximum principal amount is subject to permanent reduction in accordance with the terms, conditions, and provisions set forth and described
in Section 1.6 of this Loan Agreement. 
 NOW, THEREFORE, IN CONSIDERATION OF THESE PREMISES AND THE MUTUAL REPRESENTATIONS,
COVENANTS AND AGREEMENTS OF THE BORROWER AND THE BANK, EACH PARTY BINDING ITSELF AND ITS SUCCESSORS AND/OR ASSIGNS, HEREBY PROMISES, COVENANTS AND AGREES AS FOLLOWS: 
  

	1.	LOAN FACILITY: AMOUNT AND TERMS 

 1.1 Amount. 
  

	(a)	During the availability period described below, the Bank will provide the Loan Facility to the Borrower. The maximum principal amount of the Loan Facility is Nine Million and 00/100
($9,000,000.00) Dollars, subject to permanent reduction in accordance with the terms, conditions, and provisions set forth and described in Section 1.6 of this Loan Agreement (hereinafter, as it may be from time to time increased or
decreased, referred to as the “Loan Facility Commitment”). The Borrower agrees not to permit the principal balance outstanding under the Loan Facility to exceed the Loan Facility Commitment at any time. If the Borrower exceeds this
limit, the Borrower shall immediately repay the excess to the Bank upon the Bank’s demand. 

  

	(b)	The Loan Facility is a revolving credit loan facility. As a result, during the availability period, the Borrower may repay or prepay principal amounts outstanding under the Loan
Facility and reborrow them at any time and from time to time. 

  

 Loan Agreement 

	(c)	Subject to the terms, conditions, and provisions set forth in this Loan Agreement and provided no “Event of Default” (as such term is defined in Article 9 of this
Loan Agreement) shall have occurred and be continuing, the Bank hereby agrees to make available to the Borrower from time to time during the availability period, revolving credit loans (hereinafter each individually referred to as a
“Revolving Credit Loan” and collectively referred to as the “Revolving Credit Loans”) in principal amounts which shall not exceed, in the aggregate for all Revolving Credit Loans at any time outstanding, the Loan
Facility Commitment. If the outstanding principal amount of the Revolving Credit Loans shall exceed the Loan Facility Commitment at any time, such excess amount shall be (i) immediately due and payable by the Borrower to the Bank,
(ii) secured by the “Collateral” (as such term is hereinafter defined in Section 3.1) securing the Borrower’s obligations under this Loan Agreement, and (iii) subject to the terms, conditions and provisions of
this Loan Agreement and all of the other loan documents executed in connection herewith (hereinafter, as they may be from time to time amended, modified, extended, renewed, substituted, and/or supplemented, collectively referred to as the
“Loan Documents”). The Bank is hereby authorized to record the dates and amounts of each Revolving Credit Loan made by the Bank and the dates and amounts of each payment or prepayment of principal thereof made by the Borrower, and
any such recordation shall constitute prima facie evidence of the accuracy of the information so recorded. 

  

	(d)	For the purposes of this Loan Agreement, the following defined terms shall have the following meanings: 

 “Affiliate” shall mean, with respect to a specified Person, another Person which or who directly or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with the Person specified; provided, however, natural persons and minority partners or owners of any said Person shall not be deemed to be an
Affiliate for purposes of this definition. For the purposes of the preceding sentence, “controls” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control
with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or by
contract or otherwise, and in any case shall include direct or indirect ownership (beneficially or of record) of, or direct or indirect power to vote, five percent (5%) or more of the outstanding shares of any class of capital stock of such
Person (or in the case of a Person that is not a corporation, five percent (5%) or more of any class of equity interest). 
 “Cash” means coin or currency of the United States of America or immediately available federal funds, including such funds delivered by wire transfer. 
 “Cash Equivalents” means with respect to the Borrower all of the following of the Borrower: (i) securities issued, guaranteed or
insured by the United States of America or any of its agencies with maturities of not more than one (1) year from the date of the applicable calculation of Cash Equivalents; (ii) certificates of deposit with maturities of not more than one
(1) year from the date of the applicable calculation of Cash Equivalents and issued by a United States federal or state chartered commercial bank of recognized standing, which has capital and unimpaired surplus in excess of $500,000,000 and
which bank or its holding company has a short-term commercial paper rating of at least A-l or the equivalent by S&P or at least P-l or equivalent by Moody’s; (iii) reverse repurchase agreements with terms of not more than seven
(7) days from the date acquired, for securities of the type described in clause (i) above and entered into only with commercial banks, investment banks or other financial institutions having the qualifications described in clause
(ii) above; (iv) commercial paper issued by any Person incorporated under the 
  

 Loan Agreement 
 - 2 - 

 
laws of the United States of America or any State thereof and rated at least A-l or the equivalent thereof by S&P or at least P-l or the equivalent
thereof by Moody’s, in each case with maturities of not more than one (1) year from the date of the applicable calculation of Cash Equivalents; and (v) investments in money market funds registered under the Investment Company Act of
1940, which have net assets of at least $500,000,000.00 and at least 75% of whose assets consist of securities and other obligations of the type described in clause (i) through clause (iv) above. 
 “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time. 
 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time. 
 “ERISA Affiliate” shall mean any trade or business (whether or not incorporated) under common control with the Borrower within the
meaning of Section 414(b) or (c) of the Code. 
 “Generally Accepted Accounting Principles” shall mean generally
accepted accounting principles, consistently applied, in the United States of America, as in effect from time to time, as developed, modified and set forth in the opinions and pronouncements of the Accounting Principles Board, the American Institute
of Certified Public Accountants and the Financial Accounting Standards Board, or in such other statements by such other Persons as may be in general use by significant segments of the accounting profession, which are applicable to the circumstances
as of the date of determination. 
 “Governmental Authority” shall mean the government of the United States of America, any
other nation or any political subdivision thereof, or any agency, authority, bureau, central bank, commission, department or instrumentality of either, or any court, tribunal, grand jury or arbitrator, in each case whether foreign or domestic.

 “Person” or “Persons” shall mean any natural person, employee, general partnership, limited partnership,
limited liability partnership, limited liability company, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture, company, trust, bank or other organization, whether or not a legal entity or
any other non-governmental entity, or any Governmental Authority. 
 “Plan” shall mean a pension, profit-sharing, or stock
bonus plan intended to qualify under Section 401(a) of the Code, maintained or contributed to by the Borrower or any ERISA Affiliate, including any multiemployer plan within the meaning of Section 4001(a)(3) of ERISA. 
 “Prime Rate” shall mean the rate of interest publicly announced from time to time by the Bank as its Prime Rate. The Prime Rate is set by
the Bank based on various factors, including the Bank’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans. The Bank may price loans to its customers at, above, or
below the Prime Rate. Any change in the Prime Rate shall take effect at the opening of business on the day specified in the public announcement of a change in the Bank’s Prime Rate. 
 1.2 Availability Period; Notice of Borrowing; Tranches. 
  

	(a)	The Loan Facility is available during the period commencing on the date of this Loan Agreement and continuing up through and including June 5, 2009, or such earlier date as such
availability may terminate upon the occurrence of an Event of Default, all as provided in this Loan Agreement (hereinafter referred to as the “Expiration Date”). 

  

 Loan Agreement 
 - 3 - 

	(b)	Whenever the Borrower desires to borrow under the Loan Facility, the Borrower shall deliver to the Bank a written notice in the form of Exhibit “A” attached hereto
and made a part hereof (hereinafter referred to as a “Notice of Borrowing”) no later than 12:00 Noon (New York, New York time) on the “LIBOR Banking Day” (as such term is defined in Section l.5(a) below) preceding
the day on which the “London Inter-Bank Offered Rate” (as such term is defined in Section 1.5(c)(i) below) will be set, as specified in Section 1.5 below. Each Notice of Borrowing shall specify (1) the proposed
borrowing date (which shall be a business day) and (2) the amount of the proposed borrowing, which shall not be less than $100,000.00. 

  

	(c)	At no time during the term of the Loan Facility shall the Borrower be permitted to have more than six (6) tranches outstanding. 

 1.3 Repayment Terms. 
  

	(a)	The Borrower will pay interest quarterly in arrears on all Revolving Credit Loans at an interest rate in accordance with the terms, conditions, and provisions of
Section 1.4 below, with the first such payment of interest being due and owing on July 1, 2008, and with each subsequent payment of interest being due and owing on the first day of each calendar quarter thereafter until the required
payment in full of all principal outstanding under the Loan Facility on the Expiration Date. 

  

	(b)	The Borrower will repay in full all principal, unpaid accrued interest, fees, costs, or other charges outstanding under the Loan Facility on the Expiration Date.

  

	(c)	The Borrower may prepay Revolving Credit Loans in full or in part at any time, without premium or fee; provided, however, any principal prepayment made by the Borrower
shall be accompanied by the payment of any and all accrued and unpaid interest then outstanding on the Loan Facility, together with all other fees, expenses and sums due and owing under the Loan Facility, if any. 

  

	(d)	In the event there is any principal outstanding under the Loan Facility on the date the Borrower (i) receives the proceeds of any additional source of capital, whether such
additional capital is in the form of debt, equity, or otherwise, from any source or sources (other than issuances pursuant to the Borrower’s 2006 Stock Incentive Plan), or (ii) receives in excess of $25,000,000.00 in cash from a
third-party licensor of intellectual property relating to a pipeline product candidate of the Borrower, then, to the extent such principal is outstanding, the Borrower shall pay such amount(s) to the Bank immediately upon the Borrower’s receipt
thereof for application to said outstanding principal balance of the Loan Facility. 

 1.4 Interest Rate. The interest rate with respect
to outstanding amounts under the Loan Facility is a rate per annum equal to the “LIBOR Rate” (as such term is defined in Section 1.5 (c) below) plus one hundred basis points (1.00%). 
 1.5 LIBOR Rate Provisions. 
  

	(a)	The interest period during which the LIBOR Rate will be in effect will be one, two, or three months. The first day of the interest period must be a day other than a Saturday or a
Sunday on which banks are open for business in New York and London and dealing in offshore dollars (hereinafter referred to as a “LIBOR Banking Day”). The last day of the interest period and the actual number of days during the
interest period will be determined by the Bank using the practices of the London inter-bank market. 

  

 Loan Agreement 
 - 4 - 

	(b)	Each Revolving Credit Loan will be for an amount not less than One Hundred Thousand and 00/100 ($100,000.00) Dollars. 

  

	(c)	The term “LIBOR Rate” means the interest rate determined by the following formula (all amounts in the calculation will be determined by the Bank as of the first day
of the interest period): 

 LIBOR Rate = London Inter-Bank Offered Rate  
                         (1.00 -
Reserve Percentage) 
 Where, 
  

	 	(i)	“London Inter-Bank Offered Rate” means, for any applicable interest period, the rate per annum equal to the British Bankers Association LIBOR Rate (hereinafter
referred to as “BBA LIBOR”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as selected by the Bank from time to time) at approximately 11:00 a.m. London time two (2) London
Banking Days before the commencement of such interest period, for U.S. Dollar deposits (for delivery on the first day of such interest period) with a term equivalent to such interest period. If such rate is not available at such time for any
reason, then the rate for such interest period will be determined by such alternate method as reasonably selected by the Bank. A “London Banking Day” is a day on which banks in London are open for business and dealing in offshore dollars.

  

	 	(ii)	“Reserve Percentage” means the total of the maximum reserve percentages for determining the reserves to be maintained by member banks of the Federal Reserve System
for Eurocurrency Liabilities, as defined in Federal Reserve Board Regulation D, rounded upward to the nearest 1/100 of one percent. The percentage will be expressed as a decimal, and will include, but not be limited to, marginal, emergency,
supplemental, special, and other reserve percentages. 

  

	(d)	The Borrower shall irrevocably request a Revolving Credit Loan no later than 12:00 noon (New York, New York time) on the LIBOR Banking Day preceding the day on which the London
Inter-Bank Offered Rate will be set, as specified above. For example, if there are no intervening holidays or weekend days in any of the relevant locations, the request must be made at least three days before the LIBOR Rate takes effect.

  

	(e)	If any of the following described events has occurred and is continuing, (i) the right of the Borrower to elect to have Revolving Credit Loans bear interest based on the LIBOR
Rate shall be suspended and (ii) each outstanding Revolving Credit Loan that is then bearing interest based on the LIBOR Rate shall be converted into a Revolving Credit Loan bearing interest based on the Prime Rate on the last day of the then
current interest period therefor, notwithstanding any prior election by the Borrower to the contrary: 

  

	 	(i)	Dollar deposits in the principal amount, and for periods equal to the interest period, of a Revolving Credit Loan are not available in the London inter-bank market; or

  

 Loan Agreement 
 - 5 - 

	 	(ii)	the LIBOR Rate does not accurately reflect the cost of a Revolving Credit Loan. 

  

	(f)	Each prepayment of a Revolving Credit Loan, whether voluntary, by reason of acceleration or otherwise, will be accompanied by (i) the amounts described in
Section 1.3(c) of this Loan Agreement and (ii) the amount of any of the Bank’s losses, costs, and expenses, if any, described in Section 1.5(g) below. A “prepayment” is a payment of an amount on a date
earlier than the scheduled payment date for such amount as required by this Loan Agreement. 

  

	(g)	In connection with the prepayment of a Revolving Credit Loan as described in Section 1.5(f) above, the Borrower shall pay to the Bank, at the Bank’s request, such
amount or amounts as shall be sufficient (in the reasonable judgment of the Bank) to compensate the Bank for any and all losses, costs, and expenses (including, without limitation, any loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds required by the Bank to fund or maintain the Revolving Credit Loans to the Borrower) incurred as a result of any payment of a Revolving Credit Loan on a date other than the last day of the interest period
applicable thereto. The Bank shall deliver to the Borrower a written statement as to such losses, expenses and liabilities which statement shall be conclusive as to such amounts in the absence of manifest error. Notwithstanding the foregoing to the
contrary, in no event shall the Bank’s losses, costs, and expenses as a result of such occurrence exceed an amount computed as follows: The current rate for United States Treasury securities (bills on a discounted basis shall be converted to a
bond equivalent) with a maturity date closest to the expiration of the then-current interest period as to which prepayment is made, shall be subtracted from the LIBOR Rate in effect at the time of prepayment. If the result is a positive number, then
the resulting percentage shall be multiplied by the amount of the principal balance being prepaid. The resulting amount shall be divided by 360 and multiplied by the number of days remaining in the then-current interest period as to which prepayment
is made. Said amount shall be reduced to present value calculated by using the above-referenced United States Treasury securities rate and the number of days remaining in the then-current interest period as to which prepayment is made. The resulting
amount shall be the amount due to the Bank upon the prepayment of the applicable portion of the Revolving Credit Loan. For purposes of this Section 1.5(g), the Bank shall be deemed to have funded each Revolving Credit Loan by a matching
deposit or other borrowing in the applicable interbank market, whether or not such Revolving Credit Loan was in fact so funded. 

 1.6
Permanent Reduction in Amount of Loan Facility Commitment. 
  

	(a)	At any time as the Borrower (i) receives the proceeds of any additional source of capital, whether such additional capital is in the form of debt, equity, or otherwise, from
any source or sources (other than issuances pursuant to the Borrower’s 2006 Stock Incentive Plan), or (ii) receives in excess of $25,000,000.00 in cash from a third-party licensor of intellectual property relating to a pipeline product
candidate of the Borrower, the amount of the Loan Facility Commitment shall be automatically and permanently reduced on a dollar-for-dollar basis by such amount(s). 

  

	(b)	At any time as the Borrower sells or otherwise liquidates the auction rate securities on deposit in the “Collateral Account” (as such term is hereinafter defined), the
Loan Facility Commitment shall be automatically and permanently reduced on a dollar-for-dollar basis by the proceeds of such sale or liquidation and any principal outstanding under the Loan Facility in excess of said reduced Loan Facility Commitment
shall be repaid to the Bank simultaneously with such reduction in the Loan Facility Commitment. 

 1.7 Letters of Credit. Letters of
credit shall not be available under the Loan Facility or this Loan Agreement. 
  

 Loan Agreement 
 - 6 - 

 1.8 Use of Proceeds of the Loan Facility. The proceeds of the Loan Facility shall be used by the Borrower for the
purposes of financing a portion of the Borrower’s working capital needs and for the general corporate purposes of the Borrower. 
 1.9 No Annual
Cleanup. There shall be no annual cleanup required with respect to the Loan Facility. 
  

	2.	FEES AND EXPENSES 

 2.1 Loan Fee. The Bank hereby acknowledges that
the Borrower has heretofore paid to the Bank a loan fee in connection with the Loan Facility in the amount of Twenty Thousand and 00/100 ($20,000.00) Dollars. 
 2.2 Unused Commitment Fee. The Borrower agrees to pay an unused commitment fee on any difference between (a) the Loan Facility Commitment and (b) the amount of credit actually used by the Borrower, as determined by the
average of the daily amount of credit outstanding under the Loan Facility during the specified period. The unused commitment fee will be calculated at the rate of 0.50% per year. The unused commitment fee is payable quarterly in arrears, with
the first such payment being due on July 1, 2008, and with each subsequent payment due on the first day of each calendar quarter thereafter until the Expiration Date. 
 2.3 Late Fee. To the extent permitted by law, the Borrower agrees to pay a late fee in an amount not to exceed five percent (5%) of the amount of any payment, including, without limitation, interest and/or
principal, required to be made hereunder which payment is more than ten (10) days past due. The imposition and payment of a late fee shall not constitute a waiver of any of the Bank’s rights and remedies with respect to the default.

 2.4 Expenses. The Borrower agrees to immediately repay the Bank for reasonable expenses in connection with the Loan Facility that may include,
without limitation, filing, recording and search fees, appraisal fees, and documentation fees. 
 2.5 Reimbursement Costs. The Borrower agrees to
reimburse the Bank for any reasonable expenses it incurs in the preparation of this Loan Agreement and any agreement or instrument required by this Loan Agreement. Expenses include, but are not limited to, reasonable attorneys’ fees (estimated
to be between $8,000.00 and $10,000.00), including any allocated costs of the Bank’s in-house counsel to the extent permitted by applicable law. 
  

	3.	COLLATERAL 

 3.1 Personal Property. The personal property listed
below now owned or that may be owned in the future by the Borrower will secure the Borrower’s obligations to the Bank under this Loan Agreement (hereinafter referred to as the “Collateral”) (the Collateral is further defined in
the pledge agreement executed by the Borrower): 
  

	(a)	 A first priority security interest in and to a portfolio of auction rate securities maintained by the Borrower with the Bank in securities account number
395070 (hereinafter referred to as the “Collateral Account”), together with all proceeds and products thereof. Notwithstanding the foregoing to the contrary, to the extent the Borrower sells or otherwise liquidates the aforesaid
auction rate securities, such sold or liquidated securities and the cash proceeds therefrom (and 

  

 Loan Agreement 
 - 7 - 

	 	 
only such sold or liquidated securities and the cash proceeds therefrom) shall be released from the Collateral Account and the related security
interest simultaneously with the permanent reduction in the Loan Facility Commitment and the repayment of any principal outstanding under the Loan Facility in excess of said reduced Loan Facility Commitment, all as described in
Section 1.60(b) above; and 

  

	(b)	Such additional collateral as may be required to be deposited into the Collateral Account pursuant to the terms, conditions, and provisions set forth and described in
Section 7.20 of this Loan Agreement. 

 3.2 Real Property. There is, as of the date hereof, no real property collateral
serving as security for the Loan Facility. 
  

	4.	DISBURSEMENTS, PAYMENTS AND COSTS 

 4.1 Disbursements and Payments.

  

	(a)	Each payment made by the Borrower under this Loan Agreement will be made in U.S. Dollars and immediately available funds by debit to a deposit account of the Borrower, as described
in and required by this Loan Agreement or otherwise authorized by the Borrower. For payments not made by direct debit, payments will be made by mail to the address shown on the Borrower’s statement or at one of the Bank’s banking centers
in the United States, by wire transfer to an account designated by the Bank, or by such other method as may be permitted by the Bank from time to time. 

  

	(b)	The Bank may honor instructions for advances or repayments given by the Borrower (if an individual), or by any one of the individuals authorized to sign loan agreements on behalf of
the Borrower, or any other individual designated by any one of such authorized signers (hereinafter each referred to as an “Authorized Individual”). 

  

	(c)	For any payment under this Loan Agreement made by debit to a deposit account, the Borrower will maintain sufficient immediately available funds in the deposit account to cover each
debit. If there are insufficient immediately available funds in the deposit account on the date the Bank enters any such debit authorized by this Loan Agreement, the Bank may reverse such debit. 

  

	(d)	Each disbursement by the Bank and each payment by the Borrower will be evidenced by records kept by the Bank. In addition, the Bank may, at its discretion, require the Borrower to
sign a promissory note evidencing the Loan Facility. 

  

	(e)	Prior to the date each payment of principal, interest and/or any fees from the Borrower becomes due hereunder (hereinafter each such date shall be referred to as a “Due
Date”), the Bank will mail to the Borrower a statement of the amounts that will be due on that Due Date (hereinafter referred to as the “Billed Amount”). The calculations in the bill will be made on the assumption that no
new extensions of credit or payments will be made between the date of the billing statement and the Due Date, and that there will be no changes in the applicable interest rate. If the Billed Amount differs from the actual amount due on the Due Date
(hereinafter referred to as the “Accrued Amount”), the discrepancy will be treated as follows: 

  

	 	(i)	If the Billed Amount is less than the Accrued Amount, the Billed Amount for the following Due Date will be increased by the amount of the discrepancy. The Borrower will not be in
default by reason of any such discrepancy. 

  

 Loan Agreement 
 - 8 - 

	 	(ii)	If the Billed Amount is more than the Accrued Amount, the Billed Amount for the following Due Date will be decreased by the amount of the discrepancy. 

 Regardless of any such discrepancy, interest will continue to accrue based on the actual amount of principal outstanding without compounding. The Bank
will not pay the Borrower interest on any overpayment. 
 4.2 Telephone and Telefax Authorization. 
  

	(a)	The Bank may honor telephone or telefax instructions for advances or repayments given, or purported to be given, by any one of the Authorized Individuals. 

 

	(b)	Advances will be deposited in and repayments will be withdrawn from the “Designated Account” (as such term is defined in Section 4.3 below).

  

	(c)	The Borrower will defend, indemnify, and hold the Bank harmless from all liability, loss, and costs in connection with any act resulting from telephone or telefax instructions the
Bank reasonably believes are made by any Authorized Individual. This Section 4.2(c) will survive this Loan Agreement’s termination, and will benefit the Bank and its officers, employees, and agents. 

 4.3 Direct Debit. The Borrower agrees that on each Due Date the Bank will debit the Billed Amount from deposit account number 2017330457 owned by the Borrower, or
such other of the Borrower’s accounts with the Bank as designated in writing by the Borrower (hereinafter referred to as the “Designated Account”). 
 4.4 Banking Days. Unless otherwise provided in this Loan Agreement, a banking day is a day other than a Saturday, Sunday or other day on which commercial banks are authorized to close, or are in fact closed, in
the State of New Jersey, and, if such day relates to amounts bearing interest at an offshore rate (if any), means any such day on which dealings in Dollar deposits are conducted among banks in the offshore dollar interbank market. All payments and
disbursements which would be due on a day which is not a banking day will be due on the next banking day. All payments received on a day which is not a banking day will be applied to the credit on the next banking day. 
 4.5 Interest Calculation. Except as otherwise stated in this Loan Agreement, all interest and fees, if any, will be computed on the basis of a 360-day year and
the actual number of days elapsed. This results in more interest or a higher fee than if a 365-day year is used. Installments of principal which are not paid when due under this Loan Agreement shall continue to bear interest until paid. 

4.6 Default Rate. Upon the occurrence of any Event of Default or after maturity or after judgment has been rendered on any obligation under this Loan
Agreement, all amounts outstanding under this Loan Agreement, including any interest, fees, or costs which are not paid when due, will, at the option of the Bank, bear interest at a rate which is four hundred basis points (4.0%) higher than the
rate of interest otherwise provided under this Loan Agreement. The Bank’s imposition of such default rate will not constitute a waiver of any Event of Default. 
  

 Loan Agreement 
 - 9 - 

	5.	CONDITIONS 

 Before the Bank is required to extend any credit to the
Borrower under this Loan Agreement, it must receive all documents and other items it may reasonably require, in form and content acceptable to the Bank, including, without limitation, those items specifically listed below. 
 5.1 Authorizations. Evidence that the execution, delivery and performance by the Borrower of its obligations, responsibilities, and liabilities under this Loan
Agreement and any instrument or agreement required under this Loan Agreement have been duly authorized. 
 5.2 Governing Documents. A copy of the
Borrower’s organizational documents. 
 5.3 Security Agreements. That certain Pledge Agreement executed by the Borrower, as the debtor, in favor
of the Bank, as the secured party, covering the Collateral. 
 5.4 Perfection and Evidence of Priority. Evidence that the security interests and liens
in favor of the Bank are valid, enforceable, properly perfected in a manner acceptable to the Bank and prior to all others’ rights and interests, except those the Bank consents to in writing. 
 5.5 Payment of Fees. Payment of all fees and other amounts due and owing to the Bank, including without limitation payment of all accrued and unpaid expenses
incurred by the Bank as required by Section 2.5 hereof. 
 5.6 Good Standing. Certificates of good standing for the Borrower from its
state of incorporation and from any other state in which the Borrower is required to qualify to conduct its business. 
  

	6.	REPRESENTATIONS AND WARRANTIES 

 Upon the execution and delivery of this
Loan Agreement, the Borrower makes the following representations and warranties. Each request for a Revolving Credit Loan constitutes a renewal of these representations and warranties as of the date of the request: 
 6.1 Incorporation. The Borrower is duly incorporated and existing under the laws of the State of Delaware. 
 6.2 Authorization. This Loan Agreement, and any instrument or agreement required hereunder, are within the Borrower’s powers, have been duly authorized, and
do not conflict with any of its organizational documents or any shareholder agreements. 
 6.3 Enforceable Agreement. This Loan Agreement is a legal,
valid and binding agreement of the Borrower, enforceable against the Borrower in accordance with its terms, and any instrument or agreement required hereunder, when executed and delivered, will be similarly legal, valid, binding and enforceable, in
each case as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles. 
 6.4 Good Standing. In each state in which the Borrower does business, it is in good standing, and, where required, in compliance with fictitious name statutes.

 6.5 No Conflicts. This Loan Agreement does not conflict with any law, agreement, or obligation by which the Borrower is bound. 
  

 Loan Agreement 
 - 10 - 

 6.6 Financial Information. All financial and other information that has been or will be supplied to the Bank is
sufficiently complete to give the Bank reasonably accurate knowledge of the Borrower’s and any Affiliate’s financial condition, including all material contingent liabilities. Since the date of the most recent financial statement and/or
Securities and Exchange Commission filings (hereinafter referred to as “SEC Filings”) provided to and approved by the Bank, there has been no material adverse change in the business condition (financial or otherwise), operations,
properties or prospects of the Borrower or any Affiliate of the Borrower. 
 6.7 Lawsuits. There is no lawsuit, tax claim or other dispute pending or
threatened against the Borrower or any Affiliate of the Borrower which, if lost, would materially impair the Borrower’s or its Affiliate’s financial condition or the Borrower’s ability to repay the Loan Facility, or would have a
material adverse effect on the Borrower, any Affiliate of the Borrower, or any of their respective properties, except as have been disclosed in writing to the Bank. 
 6.8 Collateral. All Collateral is owned by the Borrower free of any title defects or any liens or interests of others, except those permitted by Section 7.5 of this Loan Agreement. 
 6.9 Permits, Franchises. The Borrower possesses all material permits, memberships, franchises, contracts and licenses required and all trademark rights, trade
name rights, patent rights, copyrights, and fictitious name rights necessary to enable it to conduct the business in which it is now engaged. 
 6.10
Other Obligations. The Borrower is not in default on any material obligation for borrowed money, any purchase money obligation or any other material lease, commitment, contract, instrument or obligation, except as have been disclosed in
writing to the Bank. 
 6.11 Tax Matters. The Borrower has no knowledge of any pending assessments or adjustments of its income tax for any year. All
returns and reports of the Borrower required to be filed, have been timely filed (or appropriate extensions of time for the filing of same have been timely requested), and all taxes, assessments, fees and other governmental charges thereupon and
upon its properties, assets, income and franchises which are shown on such returns as being due and payable, have been paid when due and payable, except as are being diligently contested in good faith by appropriate proceedings or as have been
disclosed in writing to the Bank. 
 6.12 No Event of Default. There is no event which is, or with notice or lapse of time or both would be, a default
under this Loan Agreement. 
 6.13 Insurance. The Borrower has obtained, and maintained in effect, the insurance coverage required in the
“Covenants” section of this Loan Agreement. 
  

	7.	COVENANTS 

 The Borrower hereby covenants and agrees, so long as this Loan
Agreement is outstanding and until the Bank is repaid in full, as follows: 
 7.1 Use of Proceeds. 
  

	(a)	To use the proceeds of the Loan Facility only for the purposes of financing a portion of the Borrower’s working capital needs and for the general corporate purposes of the
Borrower. 

  

 Loan Agreement 
 - 11 - 

	(b)	The proceeds of the credit extended under this Loan Agreement may not be used directly or indirectly to purchase or carry any “margin stock” as that term is defined in
Regulation U of the Board of Governors of the Federal Reserve System, or extend credit to or invest in other parties for the purpose of purchasing or carrying any such “margin stock,” or to reduce or retire any indebtedness incurred for
such purpose. 

 7.2 Financial Information - Borrower. 
 To provide the following financial information and statements in form and content acceptable to the Bank, and such additional information as requested by the Bank from time to time. 
  

	(a)	Within ninety (90) days after the Borrower’s fiscal year end (but in no event later than five (5) business days after the date of filing with the Securities and
Exchange Commission), the annual financial statements of the Borrower, certified and dated by an authorized financial officer of the Borrower. These financial statements must be audited in accordance with Generally Accepted Accounting Principles
(with an opinion satisfactory to the Bank) by a certified public accountant reasonably acceptable to the Bank. 

  

	(b)	Within forty-five (45) days after the end of each fiscal quarter of the Borrower (but in no event later than five (5) business days after the date of filing with the
Securities and Exchange Commission), quarterly financial statements of the Borrower certified and dated by an authorized financial officer of the Borrower. These financial statements shall be reviewed by a certified public accountant reasonably
acceptable to the Bank. 

  

	(c)	Promptly upon the occurrence of any event described in Sections 1.3(d)(i) or (ii) of this Loan Agreement, the nature and description of such event.

  

	(d)	Promptly upon the Bank’s reasonable request, such other books, records, statements, lists of property and accounts, budgets, forecasts or reports as to the Borrower as the Bank
may reasonably request. 

 7.3 Bank as Principal Depository. To maintain the Bank as its principal depository bank, including, without
limitation, as the bank for the maintenance of its business, cash management, and operating deposit accounts. 
 7.4 Other Debts. Not to have
outstanding or incur any direct or contingent liabilities or lease obligations (other than those to the Bank), or become liable for the liabilities of others, without the Bank’s prior express written consent. This does not prohibit: 

 

	(a)	Accounts payable owing to trade creditors arising from current liabilities for goods, services, supplies, or merchandise purchased on normal trade credit in the normal course of the
Borrower’s business. 

  

	(b)	Endorsing negotiable instruments received in the usual course of business. 

  

	(c)	Obtaining surety bonds in the usual course of business. 

  

	(d)	Liabilities, lines of credit, and leases in existence on the date of this Loan Agreement disclosed in writing to the Bank in the Borrower’s most recent financial statement.

  

 Loan Agreement 
 - 12 - 

 7.5 Other Liens. Not to create, assume, or allow any security interest or lien (including judicial liens) on
property the Borrower now or later owns, except: 
  

	(a)	Liens and security interests in favor of the Bank. 

  

	(b)	Liens for taxes not yet due or being diligently contested in good faith by appropriate proceedings. 

  

	(c)	Liens outstanding on the date of this Loan Agreement disclosed in writing to the Bank. 

  

	(d)	Carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like liens arising in the ordinary course of business. 

 

	(e)	Pledges or deposits in connection with workers’ compensation, unemployment insurance and other social security legislation. 

  

	(f)	Deposits to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of business. 

  

	(g)	Easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary conduct of the Borrower’s business. 

  

	(h)	Any interest or title of a lessor under any lease entered into by a Borrower in the ordinary course of business and covering only the assets so leased. 

  

	(i)	Liens arising solely by virtue of any statutory or common law provision relating to banker’s liens, rights of set-off or similar rights and remedies as to deposit accounts or
other funds maintained with a creditor depository institution. 

  

	(j)	Judgment liens not constituting an Event of Default under Section 9.8. 

  

	(k)	Liens in favor of any escrow agent in and in respect of any cash earnest money deposits made by the Borrower or any of its subsidiaries in connection with any letter of intent or
purchase agreement permitted hereunder. 

 7.6 Maintenance of Assets. 
  

	(a)	Not to sell, assign, lease, transfer, convey, abandon, or otherwise dispose of, voluntarily or involuntarily, any part of the Borrower’s business or the Borrower’s assets,
whether now owned or hereafter acquired, or any income or profits therefrom (other than the sale of the investments permitted under Section 7.7(c) below), except in the ordinary course of the Borrower’s business; provided,
however, that the Borrower shall be permitted (i) to sell or liquidate the auction rate securities on deposit in the Collateral Account as contemplated by Sections 1.6(b) and 3.1(a) and (ii) to license its intellectual
property and related assets in connection with strategic licensing transactions. 

  

	(b)	Not to enter into any sale and leaseback agreement covering any of its fixed assets. 

  

	(c)	To maintain and preserve all rights, privileges, and franchises the Borrower now has. 

  

	(d)	To make any repairs, renewals, or replacements to keep the Borrower’s properties in good working condition. 

  

 Loan Agreement 
 - 13 - 

 7.7 Investments. Not to have any existing, or to make any new, investments in any individual or entity, or make
any capital contributions or other transfers of assets to any individual or entity, other than in the ordinary course of business, except for: 
  

	(a)	Existing investments disclosed to the Bank in writing. 

  

	(b)	Investments in the Borrower’s current subsidiaries. 

  

	(c)	Investments in any of the following: 

  

	 	(i)	certificates of deposit; 

  

	 	(ii)	U.S. treasury bills and other obligations of the federal government; 

  

	 	(iii)	readily marketable securities (including commercial paper, but excluding restricted stock and stock subject to the provisions of Rule 144 of the Securities and Exchange Commission).

 7.8 Loans. Not to make any loans, advances or other extensions of credit to any individual or entity other than in the ordinary
course of business, except for existing extensions of credit disclosed to the Bank in writing or intercompany loans. 
 7.9 Change of Management. Not
to make any substantial change in the present executive or management personnel of the Borrower. 
 7.10 Change of Ownership. Not to cause, permit, or
suffer any change in capital ownership such that there is a change of more than twenty-five percent (25%) in the direct or indirect capital ownership of the Borrower as such capital ownership exists as of the date hereof. 
 7.11 Additional Negative Covenants. Not to, without the Bank’s prior express written consent: 
  

	(a)	Enter into any consolidation, merger, or other combination, or become a partner in a partnership, a member of a joint venture, or a member of a limited liability company.

  

	(b)	Acquire or purchase a business or its assets. 

  

	(c)	Engage in any business activities substantially different from the Borrower’s present business. 

  

	(d)	Liquidate or dissolve the Borrower’s business. 

  

	(e)	Voluntarily suspend the Borrower’s business operations for more than fifteen (15) days in any three hundred sixty-five (365) day period. 

  

	(f)	Enter into any transactions with any Affiliates other than in the ordinary course of the Borrower’s business as presently conducted. 

  

	(g)	Sell or pledge any of its assets (except in connection with strategic licensing transactions by the Borrower of its intellectual property and related assets); provided,
however, that the Borrower shall be permitted to sell or liquidate the auction rate securities on deposit in the Collateral Account as contemplated by Sections 1.6(b) and 3.1(a) of this Loan Agreement. 

  

 Loan Agreement 
 - 14 - 

 7.12 Notices to Bank. To promptly notify the Bank in writing of: 
  

	(a)	Any lawsuit over Two Hundred Fifty Thousand and 00/100 ($250,000.00) Dollars against the Borrower. 

  

	(b)	Any material substantial dispute between any Governmental Authority and the Borrower. 

  

	(c)	Any Event of Default under this Loan Agreement, or any event which, with notice or lapse of time or both, would constitute an Event of Default. 

  

	(d)	Any material adverse change in the Borrower’s business condition (financial or otherwise), operations, properties or prospects, or ability to repay the credit.

  

	(e)	Any change in the Borrower’s name, legal structure, place of business, or chief executive office if the Borrower has more than one place of business. 

 

	(f)	Any actual material contingent liabilities of the Borrower, and any such material contingent liabilities which are reasonably foreseeable. 

 7.13 Insurance. 
  

	(a)	General Business Insurance. To maintain insurance satisfactory to the Bank as to amount, nature and carrier covering property damage (including loss of use and occupancy) to
any of the Borrower’s properties, business interruption insurance, public liability insurance including coverage for contractual liability, product liability and workers’ compensation, and any other insurance which is usual for the
Borrower’s business. No later than thirty (30) days after the Effective Date, the Borrower shall cause each policy to provide for at least thirty (30) days prior notice to the Bank of any cancellation thereof.

  

	(b)	Insurance Covering Collateral. To maintain all risk property damage insurance policies (including without limitation windstorm coverage, and hurricane coverage as applicable)
covering the tangible property comprising the Collateral. Each insurance policy must be for the full replacement cost of the Collateral and include a replacement cost endorsement. The insurance must be issued by an insurance company reasonably
acceptable to the Bank. 

  

	(c)	Evidence of Insurance. Upon the request of the Bank, to deliver to the Bank a copy of each insurance policy, or, if permitted by the Bank, a certificate of insurance listing
all insurance in force. 

 7.14 Compliance with Laws. To comply with the laws (including any fictitious or trade name statute),
regulations, and orders of any Governmental Authority with authority over the Borrower’s business. The Bank shall have no obligation to make any advance to the Borrower except in compliance with all applicable laws and regulations and the
Borrower shall fully cooperate with the Bank in complying with all such applicable laws and regulations. 
  

 Loan Agreement 
 - 15 - 

 7.15 ERISA Plans. Promptly during each year, to pay and cause any subsidiaries to pay contributions adequate to
meet at least the minimum funding standards under ERISA with respect to each and every Plan; file each annual report required to be filed pursuant to ERISA in connection with each Plan for each year; and notify the Bank within ten (10) days of
the occurrence of any Reportable Event that might constitute grounds for termination of any capital Plan by the Pension Benefit Guaranty Corporation or for the appointment by the appropriate United States District Court of a trustee to administer
any Plan. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time. Capitalized terms in this paragraph shall have the meanings defined within ERISA. 
 7.16 Books and Records. To maintain adequate books and records in accordance with past practices. 
 7.17 Audits. To allow the Bank and its agents to inspect the Borrower’s properties and examine, audit, and make copies of books and records which inspection and which copies shall be made, while no Event
of Default exists, at any reasonable time during business hours upon reasonable prior notice. If any of the Borrower’s properties, books or records are in the possession of a third party, the Borrower authorizes that third party to permit the
Bank or its agents to have access to perform inspections or audits and to respond to the Bank’s requests for information concerning such properties, books and records. 
 7.18 Perfection of Liens. To help the Bank perfect and protect its security interests and liens in the Collateral, and reimburse it for related costs it incurs to protect its security interests and liens in the
Collateral. 
 7.19 Cooperation. To take any action reasonably requested by the Bank to carry out the intent of this Loan Agreement. 
 7.20 Deposit of Cash, Cash Equivalents, or Additional Securities into Collateral Account. In the event the Bank shall deem itself insecure at any time and for any
reason as a result of (a) a material adverse change in the financial or other condition of the Borrower, (b) a material adverse change in the auction rate securities market, or (c) a material adverse change in the overall credit
markets, upon receipt of written notice from the Bank as to such event, to deposit into the Collateral Account Cash, Cash Equivalents, or additional securities, in any case, in such amounts and of such types as may be required by the Bank, in its
reasonable discretion. 
 7.21 Dividends and Distributions. Not to declare or pay any dividends (except dividends paid in capital stock), redemptions
of stock or membership interests, distributions and withdrawals (as applicable) to its shareholders. 
  

	8.	HAZARDOUS SUBSTANCES 

 8.1 Indemnity Regarding Hazardous Substances.
The Borrower will defend, indemnify, and hold harmless the Bank from any loss or liability (except for any loss or liability resulting solely from the Bank’s own gross negligence or willful misconduct) the Bank incurs in connection with or as a
result of this Loan Agreement, which directly or indirectly arises out of the use, generation, manufacture, production, storage, release, threatened release, discharge, disposal or presence of a hazardous substance. This indemnity will apply whether
the hazardous substance is on, under or about the Borrower’s property or operations or property leased to the Borrower. The indemnity includes but is not limited to attorneys’ fees (including the reasonable estimate of the allocated cost
of in-house counsel and staff). The indemnity extends to the Bank, its parent, subsidiaries and all of their directors, officers, employees, agents, successors, attorneys and assigns. 
 8.2 Compliance Regarding Hazardous Substances. The Borrower represents and warrants that the Borrower has complied with all current and future laws, regulations and ordinances or other requirements of any
Governmental Authority relating to or imposing liability or standards of conduct concerning protection of health or the environment or hazardous substances. 
  

 Loan Agreement 
 - 16 - 

 8.3 Notices Regarding Hazardous Substances. Until full repayment of the Loan Facility, the Borrower will promptly
notify the Bank in writing of any threatened or pending investigation of the Borrower or its operations by any governmental agency under any current or future law, regulation or ordinance pertaining to any hazardous substance. 
 8.4 Definition of Hazardous Substances. “Hazardous substances” means any substance, material or waste that is or becomes designated or regulated
as “toxic,” “hazardous,” “pollutant,” or “contaminant” or a similar designation or regulation under any current or future federal, state or local law (whether under common law, statute, regulation or
otherwise) or judicial or administrative interpretation of such, including without limitation petroleum or natural gas. 
  

	9.	DEFAULT AND REMEDIES 

 If any of the following events of default occurs
(hereinafter each referred to as an “Event of Default”), the Bank may do one or more of the following: declare the Borrower in default, stop making any additional credit available to the Borrower, and require the Borrower to repay,
immediately and without prior notice, all principal, accrued and unpaid interest, fees, costs, and other expenses due and owing hereunder. If an event which, with notice or the passage of time, will constitute an Event of Default has occurred and is
continuing, the Bank has no obligation to make advances or extend additional credit under this Loan Agreement. In addition, if any Event of Default occurs and for so long as such Event of Default continues, the Bank shall have all rights, powers and
remedies available under any instruments and agreements required by or executed in connection with this Loan Agreement, as well as all rights and remedies available at law or in equity. If an Event of Default occurs under the paragraph entitled
“Bankruptcy,” below, with respect to the Borrower, then the entire debt outstanding under this Loan Agreement will automatically be due immediately. 
 9.1 Failure to Pay. The Borrower fails to make a payment under this Loan Agreement when due. 
 9.2 Other Bank Agreements. Any event
of default occurs under any other agreement the Borrower or any of the Borrower’s subsidiaries has with the Bank or any Affiliate of the Bank. 
 9.3
Cross-default. Any default occurs under any agreement in connection with any credit the Borrower or any of the Borrower’s subsidiaries has obtained from anyone else or which the Borrower or any of the Borrower’s subsidiaries has
guaranteed. 
 9.4 False Information. Any representation or warranty made or deemed made by the Borrower herein, in any other Loan Document, or
contained in any certificate, document or financial or other statement furnished by it at any time under or in connection with this Loan Agreement or any such other agreement shall prove to have been inaccurate in any material respect on or as of
the date made or deemed made or furnished. 
 9.5 Bankruptcy. The Borrower files a bankruptcy petition or the Borrower makes a general assignment for
the benefit of creditors. 
 9.6 Receivers. A receiver or similar official is appointed for a substantial portion of the Borrower’s business, or
the business is terminated, or, if the Borrower is anything other than a natural person, the Borrower is liquidated or dissolved. 
  

 Loan Agreement 
 - 17 - 

 9.7 Lien Priority. The Bank fails to have an enforceable first lien (except for liens permitted hereunder and
except for any prior liens to which the Bank has consented in writing) on or security interest in any property given as security for this Loan Agreement. 
 9.8 Judgments. Any judgments or arbitration awards are entered against the Borrower, or the Borrower enters into any settlement agreements with respect to any litigation or arbitration, in an aggregate amount of Two Hundred Fifty
Thousand and 00/100 ($250,000.00) Dollars or more in excess of any insurance coverage. 
 9.9 Material Adverse Change. A material adverse change
occurs, or is reasonably likely to occur, in the Borrower’s business condition (financial or otherwise), operations, properties or prospects, or ability to repay the credit; or the Bank determines that it is insecure at any time and for any
reason as a result of (a) a material adverse change in the auction rate securities market or (b) a material adverse change in the overall credit markets. 
 9.10 Government Action. Any Governmental Authority takes action that the Bank reasonably believes materially adversely affects the Borrower’s financial condition or ability to repay. 
 9.11 ERISA Plans. Any one or more of the following events occurs with respect to a Plan of the Borrower subject to Title IV of ERISA, provided such event or
events could reasonably be expected, in the reasonable judgment of the Bank, to subject the Borrower to any tax, penalty or liability (or any combination of the foregoing) which, in the aggregate, could have a material adverse effect on the
financial condition of the Borrower: 
  

	(a)	A reportable event shall occur under Section 4043(c) of ERISA with respect to a Plan. 

  

	(b)	Any Plan termination (or commencement of proceedings to terminate a Plan) or the full or partial withdrawal from a Plan by the Borrower or any ERISA Affiliate.

 9.12 Other Breach Under Agreement. A default occurs under any other term or condition of this Loan Agreement not specifically
referred to in this Article and continues for more than thirty (30) days. This includes any failure by the Borrower (or any other party named in Article 7 hereof) to comply with any covenants set forth in this Loan Agreement, whether
such failure is evidenced by financial statements delivered to the Bank or is otherwise known to the Borrower or the Bank. 
  

	10.	ENFORCING THIS LOAN AGREEMENT; MISCELLANEOUS 

 10.1 GAAP. Except as
otherwise stated in this Loan Agreement, all financial information provided to the Bank and all financial covenants will be made under Generally Accepted Accounting Principles. 
 10.2 Governing Law. This Loan Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey. To the extent that the Bank has greater rights or remedies under federal law,
whether as a national bank or otherwise, this paragraph shall not be deemed to deprive the Bank of such rights and remedies as may be available under federal law. 
 10.3 Successors and Assigns. This Loan Agreement is binding on the Borrower’s and the Bank’s successors and assignees. The Borrower agrees that it may not assign this Loan Agreement without the Bank’s prior consent.
The Bank may sell participations in or assign this loan, and may exchange information about the Borrower (including, without limitation, any information regarding any hazardous substances) with actual or potential participants or assignees. If a
participation is sold or the loan is assigned, the purchaser will have the right of set-off against the Borrower. 
  

 Loan Agreement 
 - 18 - 

 10.4 Dispute Resolution Provision. This paragraph, including the subparagraphs below, is referred to as the
“Dispute Resolution Provision.” This Dispute Resolution Provision is a material inducement for the parties entering into this Loan Agreement. 
  

	(a)	This Dispute Resolution Provision concerns the resolution of any controversies or claims between the parties, whether arising in contract, tort or by statute, including but not
limited to controversies or claims that arise out of or relate to: (i) this Loan Agreement (including any renewals, extensions or modifications); or (ii) any document related to this Loan Agreement (hereinafter collectively referred to as
a “Claim”). For the purposes of this Dispute Resolution Provision only, the term “parties” shall include any parent corporation, subsidiary or Affiliate of the Bank involved in the servicing, management or administration
of any obligation described or evidenced by this Loan Agreement. 

  

	(b)	At the request of any party to this Loan Agreement, any Claim shall be resolved by binding arbitration in accordance with the Federal Arbitration Act (Title 9, U.S. Code)
(hereinafter referred to as the “Act”). The Act will apply even though this Loan Agreement provides that it is governed by the law of a specified state. 

  

	(c)	Arbitration proceedings will be determined in accordance with the Act, the then-current rules and procedures for the arbitration of financial services disputes of the American
Arbitration Association or any successor thereof (hereinafter referred to as the “AAA”), and the terms of this Dispute Resolution Provision. In the event of any inconsistency, the terms of this Dispute Resolution Provision shall
control. If AAA is unwilling or unable to (i) serve as the provider of arbitration or (ii) enforce any provision of this arbitration clause, the parties hereto may designate another arbitration organization with similar procedures to serve
as the provider of arbitration. 

  

	(d)	The arbitration shall be administered by AAA and conducted, unless otherwise required by law, in any U.S. state where the Collateral is located. All Claims shall be determined by
one arbitrator mutually agreed by the parties hereto; however, if Claims exceed Five Million and 00/100 ($5,000,000.00) Dollars, upon the request of any party, the Claims shall be decided by three arbitrators, with one arbitrator chosen by each
party and the third arbitrator chosen by the other two. All arbitration hearings shall commence within ninety (90) days of the demand for arbitration and close within ninety (90) days of commencement and the award of the arbitrators) shall
be issued within thirty (30) days of the close of the hearing. However, the arbitrator(s), upon a showing of good cause, may extend the commencement of the hearing for up to an additional sixty (60) days. The arbitrator(s) shall provide a
concise written statement of reasons for the award. The arbitration award may be submitted to any court having jurisdiction to be confirmed and have judgment entered and enforced. 

  

	(e)	The arbitrator(s) will give effect to statutes of limitation in determining any Claim and may dismiss the arbitration on the basis that the Claim is barred. For purposes of the
application of any statutes of limitation, the service on AAA under applicable AAA rules of a notice of Claim is the equivalent of the filing of a lawsuit. Any dispute concerning this arbitration provision or whether a Claim is arbitrable shall be
determined by the arbitrator(s), except as set forth at subparagraph (h) of this Dispute Resolution Provision. The arbitrator(s) shall have the power to award legal fees pursuant to the terms of this Loan Agreement.

  

 Loan Agreement 
 - 19 - 

	(f)	This paragraph does not limit the right of any party to: (i) exercise self-help remedies, such as but not limited to, setoff; (ii) initiate judicial or non-judicial
foreclosure against the Collateral; (iii) exercise any judicial or power of sale rights, or (iv) act in a court of law to obtain an interim remedy, such as but not limited to, injunctive relief, writ of possession or appointment of a
receiver, or additional or supplementary remedies. 

  

	(g)	The filing of a court action is not intended to constitute a waiver of the right of any party, including the suing party, thereafter to require submittal of the Claim to
arbitration. 

  

	(h)	Any arbitration or trial by a judge of any Claim will take place on an individual basis without resort to any form of class or representative action (hereinafter referred to as the
“Class Action Waiver”). Regardless of anything else in this Dispute Resolution Provision, the validity and effect of the Class Action Waiver may be determined only by a court and not by an arbitrator. The parties to this Loan
Agreement acknowledge that the Class Action Waiver is material and essential to the arbitration of any disputes between the parties and is nonseverable from the agreement to arbitrate Claims. If the Class Action Waiver is limited, voided or found
unenforceable, then the parties’ agreement to arbitrate shall be null and void with respect to such proceeding, subject to the right to appeal the limitation or invalidation of the Class Action Waiver. The Parties acknowledge and agree that
under no circumstances will a class action be arbitrated. 

  

	(i)	By agreeing to binding arbitration, the parties irrevocably and voluntarily waive any right they may have to a trial by jury in respect of any Claim. Furthermore, without intending
in any way to limit this Loan Agreement to arbitrate, to the extent any Claim is not arbitrated, the parties irrevocably and voluntarily waive any right they may have to a trial by jury in respect of such Claim. This waiver of jury trial shall
remain in effect even if the Class Action Waiver is limited, voided or found unenforceable. WHETHER THE CLAIM IS DECIDED BY ARBITRATION OR BY TRIAL BY A JUDGE, THE PARTIES AGREE AND UNDERSTAND THAT THE EFFECT OF THIS LOAN AGREEMENT IS THAT THEY
ARE GIVING UP THE RIGHT TO TRIAL BY JURY TO THE EXTENT PERMITTED BY LAW. 

 10.5 Severability; Waivers. If any part of this Loan
Agreement is not enforceable, the rest of the Loan Agreement may be enforced. The Bank retains all rights, even if it makes a loan after default. If the Bank waives a default, it may enforce a later default. Any consent or waiver under this Loan
Agreement must be in writing. 
 10.6 Attorneys’ Fees. The Borrower shall reimburse the Bank for any reasonable costs and attorneys’ fees
incurred by the Bank in connection with the enforcement or preservation of any rights or remedies under this Loan Agreement and any other documents executed in connection with this Loan Agreement, and in connection with any amendment, waiver,
“workout” or restructuring under this Loan Agreement. In the event of a lawsuit or arbitration proceeding, the prevailing party is entitled to recover costs and reasonable attorneys’ fees incurred in connection with the lawsuit or
arbitration proceeding, as determined by the court or arbitrator. In the event that any case is commenced by or against the Borrower under the Bankruptcy Code (Title 11, United States Code) or any similar or successor statute, the Bank is entitled
to recover costs and reasonable attorneys’ fees incurred by the Bank related to the preservation, protection, or enforcement of any rights of the Bank in such a case. As used in this paragraph, “attorneys’ fees” includes the
allocated costs of the Bank’s in-house counsel. 
  

 Loan Agreement 
 - 20 - 

 10.7 One Agreement. This Loan Agreement and any related security or other agreements required by this Loan
Agreement, collectively: 
  

	(a)	represent the sum of the understandings and agreements between the Bank and the Borrower concerning this credit; 

  

	(b)	replace any prior oral or written agreements between the Bank and the Borrower concerning this credit; and 

  

	(c)	are intended by the Bank and the Borrower as the final, complete and exclusive statement of the terms agreed to by them. 

 In the event of any conflict between this Loan Agreement and any other agreements required by this Loan Agreement, this Loan Agreement will prevail. Any reference in any
related document to a “promissory note” or a “note” executed by the Borrower and dated as of the date of this Loan Agreement shall be deemed to refer to this Loan Agreement, as now in effect or as hereafter amended, renewed, or
restated. 
 10.8 Indemnification. The Borrower will defend, indemnify, and hold the Bank harmless from any loss, liability, damages, judgments, and
costs of any kind (except for those losses, liabilities, damages, judgments, and costs arising solely from the Bank’s own gross negligence or willful misconduct) relating to or arising directly or indirectly out of (a) this Loan Agreement
or any document required hereunder, (b) any credit extended or committed by the Bank to the Borrower hereunder, and (c) any litigation or proceeding related to or arising out of this Loan Agreement, any such document, or any such credit.
This indemnity includes but is not limited to reasonable attorneys’ fees (including the allocated cost of in-house counsel). This indemnity extends to the Bank, its parent, subsidiaries and all of their directors, officers, employees, agents,
successors, attorneys, and permitted assigns. This indemnity will survive repayment of the Borrower’s obligations to the Bank. All sums due to the Bank hereunder shall be obligations of the Borrower, due and payable immediately without demand.

 10.9 Notices. Unless otherwise provided in this Loan Agreement or in another agreement between the Bank and the Borrower, all notices required
under this Loan Agreement shall be personally delivered or sent by first class mail, postage prepaid, or by overnight courier, to the addresses on the signature page of this Loan Agreement, or sent by facsimile to the fax numbers listed on the
signature page, or to such other addresses as the Bank and the Borrower may specify from time to time in writing. Notices and other communications shall be effective (a) if mailed, upon the earlier of receipt or five (5) days after deposit
in the U.S. mail, first class, postage prepaid, (b) if telecopied, when transmitted, or (c) if hand-delivered, by courier or otherwise (including telegram, lettergram or mailgram), when delivered. 
 10.10 Headings. Article and paragraph headings are for reference only and shall not affect the interpretation or meaning of any provisions of this Loan Agreement.

 10.11 Counterparts. This Loan Agreement may be executed in as many counterparts as necessary or convenient, and by the different parties on
separate counterparts each of which, when so executed, shall be deemed an original but all such counterparts shall constitute but one and the same agreement. 
 10.12 Disposition of Schedules and Reports. The Bank will not be obligated to return any schedules, invoices, statements, budgets, forecasts, reports or other papers delivered by the Borrower. The Bank will destroy or otherwise
dispose of such materials at such time as the Bank, in its discretion, deems appropriate. 
 10.13 Confidentiality. The Bank agrees to keep
confidential all information received from the Borrower relating to its business other than any such information available to the Bank on a non-confidential basis prior to its disclosure by the Borrower, except that the Bank may discuss the 

  

 Loan Agreement 
 - 21 - 

 
Borrower’s financial affairs and business operations with any accountants, auditors, business consultants, or other professional advisors employed by
the Borrower, and the Borrower authorizes such parties to disclose to the Bank such financial and business information or reports (including management letters) concerning the Borrower as the Bank may reasonably request. 
 10.14 Limitation of Interest and Other Charges. If, at any time, the rate of interest, together with all amounts which constitute interest and which are reserved,
charged or taken by the Bank as compensation for fees, services or expenses incidental to the making, negotiating or collection of the loan evidenced hereby, shall be deemed by any competent court of law, governmental agency or tribunal to exceed
the maximum rate of interest permitted to be charged by the Bank to the Borrower under applicable law, then, during such time as such rate of interest would be deemed excessive, that portion of each sum paid attributable to that portion of such
interest rate that exceeds the maximum rate of interest so permitted shall be deemed a voluntary prepayment of principal. As used herein, the term “applicable law” shall mean the law in effect as of the date hereof; provided, however, that
in the event there is a change in the law which results in a higher permissible rate of interest, then this Loan Agreement shall be governed by such new law as of its effective date. 
 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 
  

 Loan Agreement 
 - 22 - 

 This Loan Agreement is executed as of the date stated at the top of the first page.  
  

									
	BANK OF AMERICA, N.A.	 		 	IMMUNOMEDICS, INC.
					
	By:	 	/s/ William T. Franey	 		 	By:	 	/s/ Cynthia L. Sullivan
		 	William T. Franey	 		 		 	Cynthia L. Sullivan
		 	Senior Vice President	 		 		 	President & Chief Executive Officer
			
	 Address where notices to
 the Bank are to be
sent:
	 		 	 Address where notices to
 this Borrower are
to be sent:

			
	750 Walnut Avenue	 		 	300 American Road
	Cranford, New Jersey 07016	 		 	Morris Plains, New Jersey 07950
	Facsimile: (908) 709-5468	 		 	Attn.: Gerard Gorman
		 		 	 Telephone: (973) 605-8200
 Facsimile:
(973) 605-8282

 USA Patriot Act Notice. Federal law requires all financial institutions to obtain, verify and record
information that identifies each person who opens an account or obtains a loan. The Bank will ask for the Borrower’s legal name, address, tax ID number or social security number and other identifying information. The Bank may also ask for
additional information or documentation or take other actions reasonably necessary to verify the identity of the Borrower, guarantors or other related persons. 
  

 Loan Agreement 
 - 23 - 

 EXHIBIT “A” 
 ATTACHED TO AND MADE A PART OF THAT CERTAIN LOAN AGREEMENT EXECUTED 
 BY AND
BETWEEN IMMUNOMEDICS, INC., AS BORROWER, AND 
 BANK OF AMERICA, N.A., AS LENDER, 
 DATED JUNE 6, 2008 
 Notice of
Borrowing 
 To: Bank of America, National Association (hereinafter referred to as the “Bank”) in its capacity as the Bank under
that certain Loan Agreement dated June     , 2008 (hereinafter, as it may be from time to time amended, modified, extended, renewed, substituted, and/or supplemented, referred to as the “Loan Agreement”)
entered into by and between Immunomedics, Inc., as borrower (hereinafter referred to as the “Borrower”) and the Bank. Defined terms used but not expressly defined herein shall have the same meanings when used herein as set forth in
the Loan Agreement. 
 Pursuant to Section 1.2(b) of the Loan Agreement, this Notice of Borrowing (hereinafter referred to as the
“Notice”) represents the request of the Borrower to borrow on ________________, 20___ (hereinafter referred to as the “Borrowing Date”) from the Bank in the principal amount of $ ____________ as an advance under the
Loan Facility. Proceeds of such loan shall be deposited on the Borrowing Date into Account No. 2017330457 maintained with the Bank, in immediately available funds. 
 The undersigned Borrower hereby certifies that (i) the representations and warranties of the undersigned Borrower set forth and contained in the Loan Agreement and in any other loan document (except
(a) representations and warranties which expressly speak only as of a different date and (b) representations and warranties that are subject to change as permitted or contemplated by the Loan Documents) are true and correct in all material
respects as of the Borrowing Date and (ii) no Event of Default and no event which, with the giving of notice, the passage of time, or both, would become an Event of Default has occurred and is continuing under the Loan Agreement or any other
loan document or will result from this proposed borrowing. 
 The undersigned Borrower hereby represents, warrants, and agrees that the
proceeds of the Loan Facility requested by this Notice to be advanced shall be used for the purposes permitted under the Loan Agreement. 
 Dated: ___________, 20__ 
  

			
	IMMUNOMEDICS, INC.
		
	By:	 	 
		 	Name:
		 	Title:

  

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