Common use of Litigation and Compliance with Law Clause in Contracts

Litigation and Compliance with Law. (a) There is no (i) material action, suit, claim, proceeding, or investigation pending or, to the best of Corporation’s knowledge, threatened against or affecting Corporation, at law or in equity, or before or by any federal, state, municipal, or other governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign; (ii) material arbitration proceeding relating to Corporation pending under collective bargaining agreements or otherwise; or (iii) material governmental inquiry pending or, to the best of Corporation’s knowledge, threatened against or affecting Corporation (including, without limitation, any inquiry as to the qualification of Corporation to hold or receive any license or permit), and, to the best of Corporation’s knowledge, there is no reasonable basis for any of the foregoing. Corporation is not in default with respect to any governmental order, writ, judgment, injunction, or decree known to or served upon Corporation of any court or of any federal, state, municipal or other governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign. There is no material action or suit by Corporation pending or threatened against others. (b) Corporation has complied in all respects with all laws, rules, regulations and orders applicable to its business, operations, properties, assets, products, and services, and Corporation has or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to the extent failure to comply or obtain any such permits, licenses or authorizations will not have a Material Adverse Effect. Without limiting the generality of the foregoing, (i) Corporation is not engaged, nor, to the knowledge of Corporation, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, or any rules or regulations promulgated thereunder, and (ii) Corporation has not violated in any material respect any applicable statute, law, or regulation relating to environmental or occupational health and safety, and to the best of Corporation’s knowledge, no material expenditures are or will be required to comply with any such existing statute, law, or regulation. There is no existing law, rule, regulation, or order, and Corporation is not aware of any proposed law, rule, regulation or order, whether federal or state, (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct business.

Litigation and Compliance with Law. (a) There is are no actions, suits, arbitrations, controversies or other proceedings or investigations (i) material actionor, suitto the Best Knowledge of CNB, claimany facts or circumstances which reasonably could be expected to result in such), proceedingincluding without limitation any such action by any Regulatory Authority, which currently exist or investigation are ongoing, pending or, to the best Best Knowledge of Corporation’s knowledgeCNB, threatened against are threatened, contemplated or probable of assertion, against, relating to or otherwise affecting CorporationCNB or Community or any of their respective properties, at law assets or in equityemployees. (b) CNB and Community each has all licenses, permits, orders, authorizations or before or by any approvals ("Permits") of all federal, state, municipallocal or foreign governmental or regulatory agencies that are material to or necessary for the conduct of its business or to own, or other governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreignlease and operate its properties; (ii) material arbitration all such Permits are in full force and effect; no violations have occurred with respect to any such Permits; and no proceeding relating to Corporation pending under collective bargaining agreements or otherwise; or (iii) material governmental inquiry is pending or, to the best Best Knowledge of Corporation’s knowledgeCNB, threatened against or affecting Corporation (including, without limitation, any inquiry as to the qualification probable of Corporation to hold or receive any license or permit), andassertion, to the best of Corporation’s knowledgesuspend, there cancel, revoke or limit any Permit. (c) Neither CNB nor Community is no reasonable basis for any of the foregoing. Corporation is not in default with respect subject to any governmental supervisory agreement, enforcement order, writ, judgment, injunction, or decree known to or served upon Corporation capital directive, supervisory directive, memorandum of any court or of any federal, state, municipal understanding or other governmental departmentsimilar agreement, commissionorder, boarddirective, bureaumemorandum or consent of, agencywith or issued by any Regulatory Authority (including without limitation the OCC, or instrumentalitythe FDIC, domestic or foreign. There is no material action or suit by Corporation pending or threatened against others. (bthe Virginia Bureau and the FRB) Corporation has complied in all respects with all laws, rules, regulations and orders applicable relating to its businessfinancial condition, directors or officers, employees, operations, propertiescapital, assets, products, and services, and Corporation has or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to the extent failure to comply or obtain any such permits, licenses or authorizations will not have a Material Adverse Effect. Without limiting the generality of the foregoing, (i) Corporation is not engaged, nor, to the knowledge of Corporation, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, regulatory compliance or any rules other matter; there are no judgments, orders, stipulations, injunctions, decrees or regulations promulgated thereunderawards against either CNB or Community which limit, and (ii) Corporation has not violated restrict, regulate, enjoin or prohibit in any material respect any applicable statutepresent or past business or practice of CNB or Community; and neither CNB nor Community has been advised, lawnor has any reason to believe, that any Regulatory Authority or regulation any court is contemplating, threatening or requesting the issuance of any such agreement, order, writ, injunction, directive, memorandum, judgment, stipulation, decree or award. (d) To the Best Knowledge of CNB, neither CNB nor Community is in violation or default in any material respect under, and each of them has complied in all material respects with, all laws, statutes, ordinances, rules, regulations, orders, writs, injunctions or decrees of any Regulatory Authority (including without limitation all provisions of Virginia law relating to environmental or occupational health and safetyusury, the Consumer Credit Protection Act, and all other federal and state laws and regulations applicable to extensions of credit by Community). To the best Best Knowledge of Corporation’s knowledgeCNB, no material expenditures are or will be required to comply with any such existing statute, law, or regulation. There there is no existing lawbasis for any claim by any person or authority for compensation, rulereimbursement, regulation, damages or order, and Corporation is not aware of other penalties or relief for any proposed law, rule, regulation or order, whether federal or state, violations described in this subparagraph (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct businessd).

Litigation and Compliance with Law. (a) There is are no actions, suits, arbitrations, controversies or other proceedings or investigations (ior any facts or circumstances which reasonably could result in such) material including without limitation any such action, suit, claimarbitration, proceeding, controversy or other proceeding or investigation by any Regulatory Authority, which currently exist or are ongoing, pending or, threatened, contemplated or probable of assertion, against, relating to the best or otherwise affecting Mutual or any of Corporation’s knowledgeits properties, threatened against assets or affecting Corporationemployees. (b) Mutual has all licenses, at law permits, orders, authorizations or in equity, or before or by any approvals (“Permits”) of all federal, state, municipallocal or foreign governmental or regulatory agencies that are material to or necessary for the conduct of its business or to own, or other governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreignlease and operate its properties; (ii) material arbitration proceeding relating to Corporation pending under collective bargaining agreements or otherwiseall such Permits are in full force and effect; or (iii) material governmental inquiry pending or, to the best of Corporation’s knowledge, threatened against or affecting Corporation (including, without limitation, any inquiry as to the qualification of Corporation to hold or receive any license or permit), and, to the best of Corporation’s knowledge, there is no reasonable basis for any of the foregoing. Corporation is not in default violations have occurred with respect to any governmental such Permits; no proceeding is pending or threatened or probable of assertion to suspend, cancel, revoke or limit any Permit. (c) Mutual is not subject to any supervisory agreement, enforcement order, writ, judgmentinjunction, capital directive, supervisory directive, memorandum of understanding or other similar agreement, order, directive, memorandum or consent of, with or issued by any Regulatory Authority (including without limitation the Commissioner or the FDIC) relating to financial condition, directors or officers, employees, operations, capital, regulatory compliance or any other matter; there are no judgments, orders, stipulations, injunctions, decrees or awards against Mutual which limit, restrict, regulate, enjoin or prohibit any present or past business or practice of Mutual; and, Mutual has not been advised and has no reason to believe that any Regulatory Authority or any court is contemplating, threatening or requesting the issuance of any such agreement, order, writ, injunction, directive, memorandum, judgment, stipulation, decree or decree known to award. (d) Mutual is not in violation or served upon Corporation default under, and has complied in all material respects with, all laws, statutes, ordinances, rules, regulations, orders, writs, injunctions or decrees of any court or of any federal, state, municipal or other governmental departmentRegulatory Authority having jurisdiction or authority over it or its business operations, commissionproperties or assets (including without limitation all provisions of North Carolina law relating to usury, boardthe Consumer Credit Protection Act, bureau, agency, or instrumentality, domestic or foreignand all other federal and state laws and regulations applicable to extensions of credit by Mutual). There is no material action basis for any claim by any person or suit by Corporation pending authority for compensation, reimbursement, damages or threatened against othersother penalties or relief for any violations described in this subsection (d). (b) Corporation has complied in all respects with all laws, rules, regulations and orders applicable to its business, operations, properties, assets, products, and services, and Corporation has or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to the extent failure to comply or obtain any such permits, licenses or authorizations will not have a Material Adverse Effect. Without limiting the generality of the foregoing, (i) Corporation is not engaged, nor, to the knowledge of Corporation, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, or any rules or regulations promulgated thereunder, and (ii) Corporation has not violated in any material respect any applicable statute, law, or regulation relating to environmental or occupational health and safety, and to the best of Corporation’s knowledge, no material expenditures are or will be required to comply with any such existing statute, law, or regulation. There is no existing law, rule, regulation, or order, and Corporation is not aware of any proposed law, rule, regulation or order, whether federal or state, (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct business.

Litigation and Compliance with Law. (a) There is are no (i) material actionactions, suitsuits, claimarbitrations, proceedingcontroversies or other proceedings or investigations, including without limitation any such action by any Regulatory Authority, which currently exist or investigation are ongoing, pending or, to the best knowledge of Corporation’s knowledgemanagement of Bancorp and M&F Bank, threatened against are threatened, contemplated or probable of assertion, against, relating to or otherwise affecting CorporationBancorp or M&F Bank or any of their properties, at law assets or in equity, or before or by any employees. (b) Bancorp and M&F Bank have all Permits of federal, state, municipallocal or foreign governmental or regulatory agencies that are material to or necessary for the conduct of their business or to own, or other governmental departmentlease and operate their properties; all such Permits are in full force and effect; no violations have occurred with respect to any such Permits, commissionwhich violation would have a Material Adverse Effect on Bancorp and M&F Bank, board, bureau, agency, or instrumentality, domestic or foreigntaken as a whole; (ii) material arbitration and no proceeding relating to Corporation pending under collective bargaining agreements or otherwise; or (iii) material governmental inquiry is pending or, to the best knowledge of Corporation’s knowledgemanagement of Bancorp and M&F Bank, threatened against or affecting Corporation probable of assertion to suspend, cancel, revoke or limit any Permit. (including, without limitation, any inquiry as to the qualification of Corporation to hold or receive any license or permit), and, to the best of Corporation’s knowledge, there c) Neither Bancorp nor M&F Bank is no reasonable basis for any of the foregoing. Corporation is not in default with respect subject to any governmental supervisory agreement, enforcement order, writ, judgmentinjunction, capital directive, supervisory directive, memorandum of understanding, cease and desist order, or other similar agreement, order, directive, memorandum or consent of, with or issued by any Regulatory Authority relating to financial condition, directors or officers, employees, operations, capital, regulatory compliance or any other matter; there are no judgments, orders, stipulations, injunctions, decrees or awards against Bancorp or M&F Bank which limit, restrict, regulate, enjoin or prohibit in any material respect any present or past business or practice of Bancorp or M&F Bank; and, Bancorp and M&F Bank have not been advised and have no reason to believe that any Regulatory Authority or any court is contemplating, threatening or requesting the issuance of any such agreement, order, writ, injunction, directive, memorandum, judgment, stipulation, decree or decree known to award. (d) Bancorp and M&F Bank are not in violation or served upon Corporation default in any material respect under, and have complied in all material respects with, all laws, statutes, ordinances, rules, regulations, orders, writs, injunctions or decrees of any court or of any federal, state, municipal or other governmental departmentRegulatory Authority having jurisdiction or authority over it or its business operations, commissionproperties or assets (including without limitation all provisions of North Carolina law relating to usury, boardthe Consumer Credit Protection Act, bureau, agency, or instrumentality, domestic or foreign. There is no material action or suit by Corporation pending or threatened against others. (b) Corporation has complied in and all respects with all laws, rules, other federal and state laws and regulations and orders applicable to its business, operations, properties, assets, products, and services, and Corporation has extensions of credit by Bancorp or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to the extent failure to comply or obtain any such permits, licenses or authorizations will not have a Material Adverse EffectM&F Bank). Without limiting the generality of the foregoing, (i) Corporation is not engaged, nor, to To the knowledge of Corporationmanagement of Bancorp and M&F Bank, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, or any rules or regulations promulgated thereunder, and (ii) Corporation has not violated in there is no basis for any material respect claim by any applicable statuteperson or authority for compensation, lawreimbursement, damages or regulation relating to environmental other penalties or occupational health and safety, and to the best of Corporation’s knowledge, no material expenditures are or will be required to comply with relief for any such existing statute, law, or regulation. There is no existing law, rule, regulation, or order, and Corporation is not aware of any proposed law, rule, regulation or order, whether federal or state, violations described in this subparagraph (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct businessd).

Litigation and Compliance with Law. (a) There is are no (i) material actionactions, suitsuits, claimarbitrations, proceedingcontroversies or other proceedings or investigations or, to the Knowledge of CBI, any facts or investigation circumstances which reasonably could be expected to result in such, including without limitation any such action by any Regulatory Authority, which currently exist or are ongoing, pending or, to the best Knowledge of Corporation’s knowledgeCBI, threatened threatened, contemplated or probable of assertion, against any of the CBI Companies or any person in his or her capacity as a director or officer of any of the CBI Companies, or any of their respective properties or assets, or otherwise relating to or affecting Corporationany of the CBI Companies or their respective businesses or assets. (b) Each of the CBI Companies has all licenses, at law permits, orders, and authorizations or in equity, or before or by any approvals ("Permits") of all Regulatory Authorities and all other federal, state, municipallocal or foreign governmental or regulatory agencies, that are required by law or other governmental departmentregulation and that are material to or necessary for the conduct of its business or for it to own, commission, board, bureau, agency, or instrumentality, domestic or foreignlease and operate its properties; (ii) material arbitration all such Permits are in full force and effect; no violations have occurred with respect to any such Permits; and no proceeding relating to Corporation pending under collective bargaining agreements or otherwise; or (iii) material governmental inquiry is pending or, to the best Knowledge of Corporation’s knowledgeCBI, threatened or probable of assertion, to suspend, cancel, revoke or limit any Permit except in cases in which the failure to obtain or maintain in force any such Permit, or the violation thereof, will not have a CBI Material Effect. (c) None of the CBI Companies is subject to any supervisory agreement, enforcement order, writ, injunction, capital directive, supervisory directive, memorandum of understanding or other similar agreement, order, directive, memorandum or consent of, with or issued by any Regulatory Authority relating to its financial condition, directors or officers, employees, operations, capital, public disclosure and reporting, regulatory compliance or any other matter; there are no judgments, orders, stipulations, injunctions, decrees or awards against any of the CBI Companies which limit, restrict, regulate, enjoin or affecting Corporation (includingprohibit in any material respect any present or past business or practice; and, without limitation, any inquiry as to the qualification Knowledge of Corporation to hold CBI, no Regulatory Authority or receive any license court is contemplating, threatening or permit)requesting the issuance of any such agreement, order, writ, injunction, directive, memorandum, judgment, stipulation, decree or award. (d) None of the CBI Companies is in violation or default in any material respect under, and each of them has complied in all material respects with, all laws, statutes, ordinances, rules, regulations, orders, writs, injunctions or decrees of any Regulatory Authority. To the Knowledge of CBI, no person or authority has asserted a claim, and, to the best Knowledge of Corporation’s knowledgeCBI, there is no reasonable basis for any of the foregoing. Corporation is not in default with respect to claim by any governmental orderperson or authority for compensation, writreimbursement, judgment, injunction, or decree known to or served upon Corporation of any court or of any federal, state, municipal damages or other governmental department, commission, board, bureau, agency, penalties or instrumentality, domestic or foreign. There is no material action or suit by Corporation pending or threatened against othersrelief for any violations described in this subparagraph (d). (be) Corporation CBI has complied complied, and is in compliance in all respects material respects, with the listing requirements, including all lawscorporate governance requirements, rules, regulations and orders applicable to its business, operations, properties, assets, products, and services, and Corporation has or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to the extent failure to comply or obtain any such permits, licenses or authorizations will not have a Material Adverse Effect. Without limiting the generality of the foregoing, (i) Corporation is not engaged, nor, to the knowledge of Corporation, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, or any rules or regulations promulgated thereunder, and (ii) Corporation has not violated in any material respect any applicable statute, law, or regulation relating to environmental or occupational health and safety, and to the best of Corporation’s knowledge, no material expenditures are or will be required to comply with any such existing statute, law, or regulation. There is no existing law, rule, regulation, or order, and Corporation is not aware of any proposed law, rule, regulation or order, whether federal or state, (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct businessThe American Stock Exchange.

Litigation and Compliance with Law. (a) There is are no actions, suits, arbitrations, controversies or other proceedings or investigations (i) material actionor, suitto the Best Knowledge of BOC and BOCC, claimany facts or circumstances which reasonably could result in such), proceedingincluding without limitation any such action by any Regulatory Authority, which currently exist or investigation are ongoing, pending or, to the best Best Knowledge of Corporation’s knowledgeBOC and BOCC, threatened threatened, contemplated or probable of assertion, against BOCC or affecting CorporationBOC or any of their respective properties, at law assets which, if determined adversely, could have a BOCC Material Effect. (b) BOCC and BOC each has all licenses, permits, orders, authorizations or in equity, or before or by any approvals (“Permits”) of all federal, state, municipallocal or foreign governmental or regulatory agencies that are material to or necessary for the conduct of its business or to own, or other governmental departmentlease and operate its properties, commissionall such Permits are in full force and effect, boardno violations have occurred with respect to any such Permits, bureau, agency, or instrumentality, domestic or foreign; (ii) material arbitration and no proceeding relating to Corporation pending under collective bargaining agreements or otherwise; or (iii) material governmental inquiry is pending or, to the best Best Knowledge of Corporation’s knowledgeBOC, threatened against or affecting Corporation (including, without limitation, any inquiry as to the qualification probable of Corporation to hold or receive any license or permit), andassertion, to suspend, cancel, revoke or limit any Permit, except where the best of Corporation’s knowledge, there same would not have a BOC Material Effect. (c) Neither BOCC nor BOC is no reasonable basis for any of the foregoing. Corporation is not in default with respect subject to any governmental supervisory agreement, enforcement order, writ, judgment, injunction, or decree known to or served upon Corporation capital directive, supervisory directive, memorandum of any court or of any federal, state, municipal understanding or other governmental departmentsimilar agreement, commissionorder, boarddirective, bureaumemorandum or consent of, agencywith or issued by any Regulatory Authority (including without limitation the Commissioner, the FDIC or instrumentality, domestic or foreign. There is no material action or suit by Corporation pending or threatened against others. (bthe FRB) Corporation has complied in all respects with all laws, rules, regulations and orders applicable relating to its businessfinancial condition, directors or officers, employees, operations, propertiescapital, assets, products, and services, and Corporation has or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to the extent failure to comply or obtain any such permits, licenses or authorizations will not have a Material Adverse Effect. Without limiting the generality of the foregoing, (i) Corporation is not engaged, nor, to the knowledge of Corporation, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, regulatory compliance or any rules other matter; there are no judgments, orders, stipulations, injunctions, decrees or regulations promulgated thereunderawards against either BOCC or BOC which limit, and (ii) Corporation has not violated restrict, regulate, enjoin or prohibit in any material respect any applicable statutepresent or past business or practice of BOCC or BOC; and neither BOCC or BOC has been advised, lawnor has any reason to believe, that any Regulatory Authority or regulation any court is contemplating, threatening or requesting the issuance of any such agreement, order, writ, injunction, directive, memorandum, judgment, stipulation, decree or award. (d) To the Best Knowledge of BOC and BOCC, neither BOCC nor BOC is in violation or default in any material respect under, and each of them has complied in all material respects with, all laws, statutes, ordinances, rules, regulations, orders, writs, injunctions or decrees of any Regulatory Authority (including without limitation all provisions of North Carolina law relating to environmental or occupational health and safetyusury, the Consumer Credit Protection Act, and all other federal and state laws and regulations applicable to the best extensions of Corporation’s knowledgecredit by BOC), no material expenditures are or will be required except where their failure to comply with any such existing statutewould not have a BOCC Material Effect . To the Best Knowledge of BOC and BOCC, law, or regulation. There there is no existing lawbasis for any claim by any person or authority for compensation, rulereimbursement, regulation, damages or order, and Corporation is not aware of other penalties or relief for any proposed law, rule, regulation or order, whether federal or state, violations described in this subparagraph (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct businessd).

Litigation and Compliance with Law. (a) There is are no material actions, suits, arbitrations, controversies or other proceedings or investigations (i) material actionor, suitto the Best Knowledge of management of BNC and the Bank, claimany facts or circumstances which reasonably could result in such), proceedingincluding without limitation any such action by any Regulatory Authority, which currently exist or investigation are ongoing, pending or, to the best Best Knowledge of Corporation’s knowledgemanagement of BNC and the Bank, threatened against are threatened, contemplated or probable of assertion, against, relating to or otherwise affecting CorporationBNC or the Bank or any of their properties, at law assets or in equityemployees. (b) BNC and the Bank have all licenses, permits, orders, authorizations or before or by any approvals (“Permits”) of all federal, state, municipallocal or foreign governmental or regulatory agencies that are material to or necessary for the conduct of their business or to own, or other governmental departmentlease and operate their properties; all such Permits are in full force and effect; no violations have occurred with respect to any such Permits, commissionwhich violation would have a material adverse effect on BNC and the Bank, board, bureau, agency, or instrumentality, domestic or foreigntaken as a whole; (ii) material arbitration and no proceeding relating to Corporation pending under collective bargaining agreements or otherwise; or (iii) material governmental inquiry is pending or, to the best Best Knowledge of Corporation’s knowledgemanagement of BNC and the Bank, threatened against or affecting Corporation probable of assertion to suspend, cancel, revoke or limit any Permit. (including, without limitation, any inquiry as to c) Neither BNC nor the qualification of Corporation to hold or receive any license or permit), and, to the best of Corporation’s knowledge, there Bank is no reasonable basis for any of the foregoing. Corporation is not in default with respect subject to any governmental supervisory agreement, enforcement order, writ, judgmentinjunction, capital directive, supervisory directive, memorandum of understanding, cease and desist order, or other similar agreement, order, directive, memorandum or consent of, with or issued by any Regulatory Authority relating to financial condition, directors or officers, employees, operations, capital, regulatory compliance or any other matter; there are no judgments, orders, stipulations, injunctions, decrees or awards against BNC or the Bank which limit, restrict, regulate, enjoin or prohibit in any material respect any present or past business or practice of BNC or the Bank; and, BNC and the Bank have not been advised and have no reason to believe that any Regulatory Authority or any court is contemplating, threatening or requesting the issuance of any such agreement, order, writ, injunction, directive, memorandum, judgment, stipulation, decree or decree known to award. (d) BNC and the Bank are not in violation or served upon Corporation default in any material respect under, and have complied in all material respects with, all laws, statutes, ordinances, rules, regulations, orders, writs, injunctions or decrees of any court or of any federal, state, municipal or other governmental departmentRegulatory Authority having jurisdiction or authority over it or its business operations, commissionproperties or assets (including without limitation all provisions of North Carolina law relating to usury, boardthe Consumer Credit Protection Act, bureauand all other federal and state laws and regulations applicable to extensions of credit by BNC or the Bank). To the Best Knowledge of management of BNC and the Bank, agency, or instrumentality, domestic or foreign. There there is no material action or suit by Corporation pending or threatened against others. (b) Corporation has complied in all respects with all laws, rules, regulations and orders applicable to its business, operations, properties, assets, products, and services, and Corporation has or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to the extent failure to comply or obtain any such permits, licenses or authorizations will not have a Material Adverse Effect. Without limiting the generality of the foregoing, (i) Corporation is not engaged, nor, to the knowledge of Corporation, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, or any rules or regulations promulgated thereunder, and (ii) Corporation has not violated in basis for any material respect claim by any applicable statuteperson or authority for compensation, lawreimbursement, damages or regulation relating to environmental other penalties or occupational health and safety, and to the best of Corporation’s knowledge, no material expenditures are or will be required to comply with relief for any such existing statute, law, or regulation. There is no existing law, rule, regulation, or order, and Corporation is not aware of any proposed law, rule, regulation or order, whether federal or state, violations described in this subparagraph (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct businessd).

Litigation and Compliance with Law. (a) There is no (i) material actionThere are no actions, suitsuits, claimarbitrations, proceedingcontroversies or other proceedings or investigations (or, to the knowledge of management of the Holding Company, any facts or investigation circumstances which reasonably could result in such), including without limitation any such action by any governmental or regulatory authority, which currently exists or is ongoing, pending or, to the best knowledge of Corporation’s knowledgemanagement of the Holding Company, threatened against threatened, contemplated or probable of assertion, against, relating to or otherwise affecting Corporationthe Holding Company or any of its properties or assets which, at law or if determined adversely, could result in equityliability on the part of the Holding Company for, or before subject it to, monetary damages, fines or by penalties, or an injunction, and which could have a Material Adverse Change in the Holding or on the ability of the Holding Company or Triangle to consummate the Merger; (ii) The Holding Company and its subsidiaries each has all licenses, permits, orders, authorizations or approvals ("Permits") of any federal, state, municipallocal or foreign governmental or regulatory body that are material to or necessary for the conduct of its business or to own, lease and operate its properties; all such Permits are in full force and effect; no violations are or other governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreignhave been recorded in respect of any such Permits; (ii) material arbitration and no proceeding relating to Corporation pending under collective bargaining agreements or otherwise; or (iii) material governmental inquiry is pending or, to the best knowledge of Corporation’s knowledgemanagement of the Holding Company, threatened against or affecting Corporation probable of assertion to suspend, cancel, revoke or limit any Permit; (including, without limitation, any inquiry as to iii) Neither the qualification of Corporation to hold or receive any license or permit), and, to the best of Corporation’s knowledge, there is no reasonable basis for Holding Company nor any of the foregoing. Corporation its subsidiaries is not in default with respect subject to any governmental supervisory agreement, enforcement order, writ, judgmentinjunction, capital directive, supervisory directive, memorandum of understanding or other similar agreement, order, directive, memorandum or consent of, with or issued by any regulatory or other governmental authority (including without limitation the FDIC, the FRB or the Commissioner) relating to its financial condition, directors or officers, operations, capital, regulatory compliance or otherwise; there are no judgments, orders, stipulations, injunctions, decrees or awards against the Holding Company or any of its subsidiaries which in any manner limit, restrict, regulate, enjoin or prohibit any present or past business or practice of the Holding Company or any of its subsidiaries; and neither the Holding Company nor any of its subsidiaries has been advised or has any reason to believe that any regulatory or other governmental authority or any court is contemplating, threatening or requesting the issuance of any such agreement, order, injunction, directive, memorandum, judgment, stipulation, decree or decree known to award; and, (iv) Neither the Holding Company nor any of its subsidiaries is in violation or served upon Corporation default in any material respect under, and each has complied in all material respects with, all laws, statutes, ordinances, rules, regulations, orders, writs, injunctions or decrees of any court or of any federal, state, municipal or other governmental departmentor regulatory authority having jurisdiction or authority over it or its business operations, commissionproperties or assets (including without limitation all provisions of North Carolina law relating to usury, boardthe Consumer Credit Protection Act, bureau, agency, or instrumentality, domestic or foreign. There and all other laws and regulations applicable to extensions of credit by the Holding Company's bank subsidiaries) and there is no material action basis for any claim by any person or suit by Corporation pending authority for compensation, reimbursement or threatened against others. (b) Corporation has complied in all respects with all laws, rules, regulations and orders applicable to its business, operations, properties, assets, products, and services, and Corporation has damages or will acquire all necessary permits, licenses, and other authorizations required to conduct is business as conducted and as proposed to be conducted, except to otherwise for any violation of any of the extent failure to comply or obtain any such permits, licenses or authorizations will not foregoing that would have a Material Adverse Effect. Without limiting Effect on the generality of the foregoing, (i) Corporation is not engaged, nor, to the knowledge of Corporation, has any officer, director, partner, employee, or agent of Corporation engaged, in any act or practice which would constitute a violation of the Foreign Corrupt Practices Act of 1977, or any rules or regulations promulgated thereunder, and (ii) Corporation has not violated in any material respect any applicable statute, law, or regulation relating to environmental or occupational health and safety, and to the best of Corporation’s knowledge, no material expenditures are or will be required to comply with any such existing statute, law, or regulation. There is no existing law, rule, regulation, or order, and Corporation is not aware of any proposed law, rule, regulation or order, whether federal or state, (excluding product approvals from regulatory authorities required to offer its products for human use) which would prohibit or materially restrict Corporation from, or otherwise materially adversely affect Corporation in, conducting its business in any jurisdiction in which it is now conducting business or in which it proposes to conduct businessHolding Company.