PURCHASE AND ASSUMPTION AGREEMENT Between STELLARONE BANK (“Seller”) and FIRST BANK (“Purchaser”)

ARTICLE I TRANSFER OF ASSETS AND LIABILITIES

1

Section 1.1. Transferred Assets

1

Section 1.2. Purchase Price

2

Section 1.3. Deposit Liabilities

4

Section 1.4. Overdraft Loans Transferred

7

Section 1.5. Safe Deposit Business

9

Section 1.6. Employee Matters

10

Section 1.7. Records and Data Processing

10

Section 1.8. Security

11

Section 1.9. Taxes and Fees; Proration of Certain Expenses

11

Section 1.10. Real Property

11

Section 1.11. Purchase Price Allocation

14

Section 1.12. Purchaser’s Due Diligence

14

ARTICLE II CLOSING AND EFFECTIVE TIME

15

Section 2.1. Effective Time

15

Section 2.2. Closing

15

Section 2.3. Post-Closing Adjustments

18

ARTICLE III INDEMNIFICATION

19

Section 3.1. Seller’s Indemnification of Purchaser

19

Section 3.2. Purchaser’s Indemnification of Seller

19

Section 3.3. Claims for Indemnity

19

Section 3.4. Limitations on Indemnification.

20

Section 3.5. Exclusive Remedy.

20

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER

20

Section 4.1. Corporate Organization

20

Section 4.2. No Violation

21

Section 4.3. Corporate Authority

21

Section 4.4. Enforceable Agreement

21

Section 4.5. No Brokers

21

Section 4.6. Personal Property

21

Section 4.7. Real Property

21

Section 4.8. Condition of Property

22

Section 4.9. Overdraft Loans

22

Section 4.10. Compliance with Certain Laws

22

Section 4.11. Community Reinvestment Act Representation

22

Section 4.12. Limitation of Representations and Warranties

23

ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASER

23

Section 5.1. Corporate Organization

23

Section 5.2. No Violation

23

Section 5.3. Corporate Authority

23

Section 5.4. Enforceable Agreement

23

Section 5.5. No Brokers

24

ARTICLE VI OBLIGATIONS OF PARTIES PRIOR TO AND AFTER EFFECTIVE TIME

24

Section 6.1. Access to Information

24

Section 6.2. Delivery of Magnetic Media Records

24

Section 6.3. Application for Approval to Effect Purchase of Assets and

Assumption of Liabilities and to Close the Banking Center

24

Section 6.4. Conduct of Business; Maintenance of Properties

25

Section 6.5. No Solicitation by Seller

26

Section 6.6. Further Actions

26

Section 6.7. Fees and Expenses

26

Section 6.8. Breaches with Third Parties

26

Section 6.9. Insurance

27

Section 6.10. Public Announcements

27

Section 6.11. Tax Reporting

27

Section 6.12. Use of Seller’s Name and Documents

27

Section 6.13. Access to the Real Property; Purchaser Installation and Modification

27

ARTICLE VII CONDITIONS TO PURCHASER'S OBLIGATIONS

28

Section 7.1. Representations and Warranties True

28

Section 7.2. Obligations Performed

28

Section 7.3. No Adverse Litigation

28

Section 7.4. Regulatory Approval

28

ARTICLE VIII CONDITIONS TO SELLER'S OBLIGATIONS

29

Section 8.1. Representations and Warranties True

29

Section 8.2. Obligations Performed

29

Section 8.3. No Adverse Litigation

29

Section 8.4. Regulatory Approval

29

Section 8.5. Erosion of Amounts on Deposit

30

ARTICLE IX TERMINATION

30

Section 9.1. Methods of Termination

30

Section 9.2. Procedure Upon Termination

31

Section 9.3. Payment of Expenses

31

ARTICLE X MISCELLANEOUS PROVISIONS

31

Section 10.1. Amendment and Modification

31

Section 10.2. Waiver or Extension

32

Section 10.3. Assignment

32

Section 10.4. Confidentiality

32

Section 10.5. Knowledge of Seller

32

Section 10.6. Retention of Documents

33

Section 10.7. Addresses for Notices, Etc.

33

Section 10.8. Counterparts

34

Section 10.9. Headings

34

Section 10.10. Governing Law

34

Section 10.11. Sole Agreement

34

Section 10.12. Severability

35

Section 10.13. Parties In Interest

35

(a)

As of the Effective Time (as defined in Section 2.1) and upon the terms and conditions set forth herein, Seller will sell, assign, transfer, convey and deliver to Purchaser, and Purchaser will purchase from Seller, all of the rights, title and interests of Seller in the following assets associated with the Banking Center and identified in this Agreement and the Exhibits hereto, and not otherwise excluded from sale pursuant to the provisions of Subsection 1.1(b):

(1)

subject to Section 1.10, the real property and all improvements thereon (collectively, the “Real Property”) at the Banking Center, together with all rights and appurtenances pertaining thereto; a more particular description of which is set forth on Exhibit 1.1(a)(1);

(2)

except as provided in Section 1.1(b), the furniture, fixtures, security equipment, automated teller machines and other equipment and other tangible personal property owned by Seller and located at the Banking Center or used in conducting Seller’s business at the Banking Center (the “Personal Property”);

(3)

[OMITTED INTENTIONALLY]

(4)

all safe deposit contracts and leases for the safe deposit boxes located at the Banking Center as of the Effective Time (the “Safe Deposit Contracts”);

(5)

all Overdraft Loans (as defined in Section 1.4(a)) transferred pursuant to Section 1.4;

(6)

all coins and currency located at the Banking Center as of the Effective Time (the “Coins and Currency”);

(7)

all merchant services accounts associated with Deposit Liabilities (as defined in Section 1.3(a)) located at the Banking Center; and

(8)

all night depository contracts.

(b)

Excluded from the assets, properties and rights being transferred, conveyed and assigned to Purchaser under this Agreement are the assets listed on Exhibit 1.1(b) hereto, Seller’s rights in and to the name “Second Bank & Trust,” Planters Bank & Trust Company,” “StellarOne Corporation,” “StellarOne Bank,” “StellarOne,” and any variant thereof, and any of Seller’s corporate logos, trademarks, trade names, signs, paper stock, forms and other supplies containing any such logos, trademarks or trade names, and trade names and logos of third parties with whom Seller has contracted to provide services to its customers (together, the “Excluded Assets”). Seller shall coordinate with Purchaser to remove the Excluded Assets from the Banking Center on or prior to the Effective Time. Notwithstanding the foregoing provisions, Purchaser and customers of the Banking Center may continue to use night deposit bags containing such trademarks, trade names and logos, and any keys thereto, until Purchaser replaces them, which replacement Purchaser shall effect as promptly as practicable after the Effective Time. Except as otherwise expressly provided herein, Seller shall remove the Excluded Assets at its own cost, and shall make any repairs necessitated by removing the Excluded Assets.

(a)

As consideration for the purchase of the Banking Center, Purchaser shall pay Seller a purchase price (the “Purchase Price”) equal to the sum of the following:

(1)

A premium for the Deposit Liabilities (as defined in Section 1.3(a)) and franchise value related to the Banking Center equal to 2.0% of the Deposit Liabilities;

(2)

The Net Book Value (as defined in Section 1.2(d)), including accrued interest, of the Overdraft Loans as set forth in Section 1.4;

(3)

The Net Book Value (as defined in Section 1.2(d)) of the Personal Property;

(4)

The fair market value of the Real Property (the “Appraised Value”) as determined by a qualified appraiser who is mutually acceptable to Seller and Purchaser and whose fees and costs for making such appraisal or shared equally by Seller and Purchaser; and

(4)

The face amount of the Coins and Currency.

(b)

In addition, Purchaser shall assume, as of the Effective Time, all of the duties, obligations and liabilities of Seller arising on or after the Effective Time relating to the Real Property, the Safe Deposit Contracts and the Deposit Liabilities (including all accrued interest relating thereto) (collectively, the “Assumed Liabilities”); provided, that any cash items paid by Seller and not cleared prior to the Effective Time shall be the responsibility of Seller, subject to the terms of Section 1.3.

(c)

Seller shall prepare a balance sheet (the “Pre-Closing Balance Sheet”) in accordance with customary banking practices as of a date two business days prior to the Effective Time anticipated by the parties (the “Pre-Closing Balance Sheet Date”) reflecting the assets to be sold and assigned and the liabilities to be transferred and assumed hereunder, all based on the estimated book value of such assets and liabilities as of the Effective Time. Seller agrees to pay to Purchaser at the Closing (as defined in Section 2.1), in immediately available funds, the excess amount, if any, of the amount of Deposit Liabilities assumed by Purchaser pursuant to subsection (b) above, as reflected by the Pre-Closing Balance Sheet, over the aggregate Purchase Price computed in accordance with subsection (a) above, as reflected by the Pre-Closing Balance Sheet. Purchaser agrees to pay Seller at the Closing by wire transfer, in immediately available funds, the excess, if any, of the aggregate Purchase Price computed in accordance with subsection (a) above, as reflected by the Pre-Closing Balance Sheet, over the amount of Deposit Liabilities assumed by Purchaser pursuant to subsection (b) above, as reflected by the Pre-Closing Balance Sheet. Amounts paid at Closing shall be subject to subsequent adjustment based on the Post-Closing Balance Sheet (as defined in Section 2.3).

(d)

For purposes of this Agreement, “Net Book Value” means the value determined from the Post-Closing Balance Sheet; provided, however, that such value shall not include the loan loss reserve attributable to any Overdraft Loan or any general reserve, and provided further that, if the Closing occurs on any day other than the first (1^st) day of a calendar month, then, with respect to the depreciable assets to

(a)

“Deposit Liabilities” shall mean all of Seller’s duties, obligations and liabilities relating to the deposit accounts (except as set forth in Section 1.3(b)) located at and attributable to the Banking Center as of the Effective Time (including accrued but unpaid or uncredited interest thereon), including, but not limited to, demand deposit accounts, savings accounts, certificates of deposit and deposits held in Individual Retirement Accounts. A projected list of the Deposit Liabilities is attached as Exhibit 1.3(a) and shall be updated as soon as practicable after Closing.

(b)

Except for those liabilities and obligations specifically assumed by Purchaser under Section 1.2(b) and except as otherwise provided in Section 1.6(a), Purchaser is not assuming any other liabilities or obligations of Seller or otherwise. Subject to the limitations on indemnification set forth in Section 3.4, liabilities not assumed include, but are not limited to, the following:

(1)

Seller’s official checks, cashier’s checks, letters of credit, money orders, interest checks and expense checks issued prior to Closing, consignments of U.S. Government “E” and “EE” bonds and any and all traveler’s checks.

(2)

Liabilities or obligations of Seller with respect to any litigation, suits, claims, demands or governmental proceedings arising, commenced or made known to Seller prior to Closing or arising from events occurring prior to Closing.

(3)

Accounts overdrawn or without sufficient funds on the Pre-Closing Balance Sheet, except that at Closing Purchaser may elect to purchase any one or more of such accounts.

(4)

Deposit accounts associated with lines of credit where the line of credit is excluded in accordance with Section 1.4(b).

(5)

Seller’s obligations for or under any data processing contracts and any lawn maintenance, landscaping, parking area maintenance, equipment maintenance, cleaning and janitorial services and other contracts relating to the maintenance, repair or operation of the Real Property or any equipment.

(6)

Deposit accounts associated with Seller’s national or regional account relationships, if any.

(7)

Closed accounts of any kind or listings or descriptions of such accounts.

(c)

Seller does not represent or warrant that any deposit customers whose accounts are assumed by Purchaser will become or continue to be customers of Purchaser after the Effective Time.

(d)

Purchaser agrees to pay in accordance with law and customary banking practices all properly drawn and presented checks, drafts and withdrawal orders presented to Purchaser by mail, over the counter or through the check clearing system of the banking industry, by depositors of the accounts assumed, whether drawn on the check, withdrawal or draft forms provided by Seller or by Purchaser, and in all other respects to discharge, in the usual course of the banking business, the duties and obligations of Seller with respect to the balances due and owing to the depositors whose accounts are assumed by Purchaser. Notwithstanding the foregoing provisions, after the Effective Time Purchaser, in its discretion, may establish a time after which it shall no longer pay any checks, drafts or withdrawal orders on forms provided by Seller.

(e)

Seller agrees to honor electronic transactions by depositors authorized prior to the Effective Time for a period of 5 days after the Effective Time. Seller and Purchaser shall make arrangements to provide for the daily settlement with immediately available funds by Purchaser of any electronic transactions honored by Seller pursuant to this Section 1.3(e), and Seller shall be held harmless and indemnified by Purchaser for acting in accordance with this arrangement.

(f)

If, after the Effective Time, any depositor, instead of accepting the obligation of Purchaser to pay the Deposit Liabilities assumed, demands payment from Seller for all or any part of any such assumed Deposit Liabilities, Seller shall not be liable or responsible for making any such payment; provided, that if Seller shall pay the same, Purchaser agrees to reimburse Seller for any such payments, subject only to the following limitations: (i) Purchaser shall have no obligation to reimburse Seller for checks, drafts, withdrawal orders, returns and other items paid by Seller hereunder that concern accounts Purchaser has closed and as to which Seller has received written notice of such closure; (ii) items presented to Seller in the teller line and drawn on or chargeable to accounts that have been assumed by Purchaser shall be reimbursed by Purchaser only if paid by Seller within 30 calendar days after the Effective Time; and (iii) Purchaser shall have no obligation to reimburse Seller for any in-clearing item in excess of $10,000 that was not authorized by Purchaser prior to Seller’s 3:00 p.m. cutoff for processing on the day accepted. Seller and Purchaser shall make arrangements to provide for the daily settlement by Purchaser with immediately available funds of items subject to reimbursement under this Section 1.3(f). Seller shall not be deemed to

(g)

Purchaser agrees, at its cost and expense, (1) to notify the depositors of assumed accounts, on or before the Effective Time, in a form and mailed on a date mutually acceptable to Seller and Purchaser, of Purchaser’s assumption of the Deposit Liabilities, and (2) to furnish such depositors with checks on the forms of Purchaser and with instructions to use Purchaser’s checks and to destroy unused check, draft and withdrawal order forms of Seller. (If Purchaser so elects, Purchaser may offer to buy from such depositors their unused Seller's check, draft and withdrawal order forms.) In addition, Seller will notify its affected customers by letter of the pending assignment of the Deposit Liabilities to Purchaser, which notice shall be at Seller’s cost and expense and shall be in a form and mailed on a date mutually agreeable to Seller and Purchaser.

(h)

Purchaser agrees to pay promptly to Seller an amount equivalent to the amount of any checks, drafts or withdrawal orders deposited in an assumed account as of the Effective Time that are properly returned to Seller after the Effective Time. Notwithstanding the foregoing, Purchaser shall not be responsible for any checks returned due to fraudulent endorsement by the payee.

(i)

On and after the Effective Time, Purchaser will assume and discharge Seller’s duties and obligations as to the Assumed Liabilities in accordance with the terms and conditions and laws, rules and regulations that apply to the Assumed Liabilities.

(j)

On and after the Effective Time, Purchaser will maintain and safeguard in accordance with applicable law and sound banking practices all account documents, deposit contracts, signature cards, deposit slips, canceled items and other records related to the Deposit Liabilities assumed under this Agreement, subject to Seller’s right of access to such records as provided in this Agreement.

(k)

Seller will render a final statement to each depositor of an account assumed under this Agreement as to transactions occurring through the Effective Time; provided, that Seller shall not be obligated to render a final statement on any account not ordinarily receiving periodic statements in the ordinary course of Seller’s business. Seller will be entitled to impose normal fees and service charges on a per item basis at Closing, but Seller will not impose periodic fees or blanket charges in connection with such final statements.

(l)

Seller will timely provide to Purchaser the 1099 data required for Purchaser to comply with all laws, rules and regulations regarding 2009 tax reporting of

(m)

As of the Effective Time, Purchaser, at its expense, will notify all Automated Clearing House (“ACH”) originators of the transfers and assumptions made pursuant to this Agreement; provided, that Seller may, at its option, notify all such originators itself (on behalf of Purchaser) also at the expense of Purchaser. For a period of 60 calendar days beginning on the Effective Time, Seller will honor all ACH items related to accounts assumed under this Agreement that are routed or presented to Seller, except those concerning accounts (i) that Purchaser has closed, and (ii) as to which Seller has received written notice of such closure, and except that Seller shall not honor any such item in excess of $10,000 that has not been authorized by Purchaser prior to Seller’s 3:00 p.m. cutoff for processing. Seller will make no charge to Purchaser for honoring such items and will electronically transmit such ACH data to Purchaser. If Purchaser cannot receive an electronic transmission, Seller will make available to Purchaser at Seller’s operations center receiving items from the Automated Clearing House tapes containing such ACH data. Items routed or presented after the 60 day period shall be returned to the presenting party. Seller and Purchaser shall make arrangements to provide for the daily settlement with immediately available funds by Purchaser of any ACH items honored by Seller pursuant to this Section 1.3(m), and Seller shall be held harmless and indemnified by Purchaser for acting in accordance with this arrangement.

(n)

For up to sixty (60) days after the Effective Time, Purchaser agrees to use commercially reasonable efforts to collect from Purchaser’s customers amounts equal to any Visa or MasterCard chargebacks under the Visa and MasterCard Merchant Agreements between Seller and its customers, or amounts equal to any deposit items returned to Seller after the Effective Time that were honored by Seller prior to the Effective Time, and remit such amounts so collected to Seller. Purchaser agrees to immediately freeze and remit to Seller any funds, up to the amount of the charged back or returned item that had been previously credited by Seller, if such funds are available at the time of notification by Seller to Purchaser of the charged back or returned item and such chargeback is permitted. Notwithstanding the foregoing, Purchaser shall have no duty to remit funds for any item or charge that has been improperly returned or charged to Seller. Solely for the purposes of this Section 1.3(m), all references to Seller shall be deemed to include Seller and its assignees.

(a)

Seller will transfer to Purchaser as of the Effective Time, subject to the terms and conditions of this Agreement, all of Seller’s right, title and interest in any overdraft loans (including collateral relating thereto) made by Seller in connection with the Deposit Liabilities to be assumed by Purchaser hereunder (collectively,

(b)

Notwithstanding the provisions of subsection (a) above, the Overdraft Loans shall not include:

(1)

nonaccruals (which term shall mean loans in which the collateral securing same has been repossessed, or in which collection efforts have been instituted, or claim and delivery or foreclosure proceedings have been filed) and classified Overdraft Loans;

(2)

loans 45 calendar days or more past due, which are classified, or that have been charged off; provided further that if any loans, subsequent to the execution of this Agreement and prior to the Effective Time, are classified by the applicable bank examiners or Seller, as "doubtful," "substandard," "loss," or "special mention," or the equivalent on Seller’s loan grading system, then such loans, at the option of Purchaser, may be excluded;

(3)

loans upon which insurance has been force-placed;

(4)

loans in connection with which the borrower has filed a petition for relief under the United States Bankruptcy Code prior to the Effective Time;

(5)

loans identified by Purchaser in writing on or before the end of the Title Review Period (as hereafter defined) as having any collateral perfection deficiency;

(6)

loan loss reserves;

(7)

loans as to which the borrower’s FICO score is 660 or less; or

(8)

loans other than Overdraft Loans.

(c)

For a period of 60 days after the Effective Time, Seller will forward to Purchaser any Overdraft Loan payments received by Seller. Purchaser shall reimburse Seller upon demand for checks returned on payments forwarded to Purchaser;

(d)

As of the Effective Time, Seller shall transfer and assign all files, documents and records related to the Overdraft Loans (the “Records”) to Purchaser, and, upon receipt from Seller, Purchaser will be responsible for maintaining and safeguarding all of the Records in accordance with applicable law and sound banking practices.

(e)

If the balance due on any Overdraft Loan purchased pursuant to this Section 1.4 has been reduced by Seller as a result of a payment by check received prior to the Effective Time, which item is returned up to 60 days after the Effective Time, the asset value represented by the Overdraft Loan transferred shall be correspondingly increased and an amount in cash equal to such increase shall be paid by Purchaser to Seller promptly upon demand.

(f)

Seller shall grant to Purchaser as of the Effective Time a limited power of attorney, in substantially the form attached hereto as Exhibit 1.4(k) (the “Power of Attorney”).

(a)

As of the Effective Time, Purchaser will assume and discharge Seller’s obligations with respect to the safe deposit box business at the Banking Center arising on or after the Effective Time in accordance with the terms and conditions of contracts or rental agreements related to such business, and Purchaser will maintain all facilities necessary for the use of such safe deposit boxes by persons entitled to use them; provided that nothing herein shall be deemed to prohibit Purchaser, after the Effective Time, from discontinuing the safe deposit box services or facilities at the Banking Center (all in accordance with applicable law and any contractual obligations regarding the same).

(b)

As of the Effective Time, Seller shall transfer and assign the records related to such safe deposit box business to Purchaser, and Purchaser shall maintain and safeguard all such records and be responsible for granting access to and protecting the contents of safe deposit boxes at the Banking Center.

(c)

Safe deposit box rental payments (not including late payment fees) collected by either Seller or Purchaser applying to periods both before and after the Effective Time shall be prorated as of the Effective Time.

(a)

Beginning as of the date as of which this Agreement has been fully executed by the parties, as reflected by the dates on the signature page hereof (the “Execution Date”), through the Effective Time and for 6 months thereafter, to the extent Purchaser advertises any position at the Banking Center, Purchaser shall interview any employees employed by Seller at the Banking Center as of the Effective Time who apply for such position. If Purchaser elects to offer employment to any one or more of such employees (each, a “Hired Employee”), then, notwithstanding any gap in employment between the Effective Date and the date Purchaser hires a Hired Employee, the Hired Employee shall receive full credit for his prior service with Seller under Purchaser’s benefit plans and policies, including Purchaser’s vacation and sick leave policies (but excluding Purchaser’s qualified and nonqualified pension plans, if any), to the same extent as if such service had been with Purchaser. Neither Seller nor Purchaser shall, however, be hereby obligated to compensate any Hired Employee for any period between the Effective Date and the date Purchaser hires such employee. In addition, the Purchaser agrees to begin the employment of any Hired Employee no earlier than the day after the Effective Date. With respect to Purchaser’s qualified and nonqualified pension plans, Hired Employees shall also receive full credit for prior service with Seller (as reflected on Seller’s personnel records for each such Hired Employee) for purposes of determining their participation eligibility and vesting rights to the same extent as if such service had been with Purchaser. Benefits under Purchaser’s pension plans for any Hired Employee shall be determined solely with reference to service with Purchaser. Notwithstanding any contrary provisions hereof, Purchaser shall have no obligation hereunder to hire anyone.

(b)

Seller makes no representations or warranties about whether any of its employees will remain at the Banking Center through the Effective Time. Seller will use its commercially reasonable best efforts to maintain the employees as employees of Seller at the Banking Center until the Effective Time. Purchaser shall have no responsibilities or rights with respect to any employee of Seller whose employment shall be terminated for any reason prior to the Effective Time, to whom Purchaser does not offer employment or who shall elect not to become an employee of Purchaser, and severance payments, if any, with respect to any of such employees shall be the sole responsibility of Seller. Seller agrees that, for a period of 12 months after Purchaser hires any Hired Employee, Seller will not solicit such Hired Employee for employment.

(a)

As of the Effective Time, Purchaser shall become responsible for maintaining the files, documents and records referred to in this Agreement. Purchaser will preserve and safe keep such files, documents and records as required by applicable law and sound banking practice. After the Effective Time, Purchaser will permit Seller and its representatives at reasonable times and upon reasonable

(b)

As of the Effective Time, Seller will permit Purchaser and its representatives, at reasonable times and upon reasonable notice, to examine, inspect, copy and reproduce (at Purchaser’s expense) files, documents or records retained by Seller regarding the assets and liabilities transferred under this Agreement as Purchaser reasonably deems necessary. Any such examination, inspection, copying and reproduction occurring before the Effective Time shall be at Purchaser’s sole expense.

(c)

It is understood that certain of Purchaser's and Seller’s records may be available only in the form of photocopies, film copies or other non-original and non-paper media.

(d)

As of the Effective Time, at Purchaser’s cost, Purchaser shall see to the conversion of all records, data and systems (including, without limitation, the ▇▇▇▇ ▇▇▇▇▇ system) of the Banking Center to Purchaser

(a)

Title Review Period. For the period commencing on the date of this Agreement and extending through the thirtieth (30^th) day after the date of this Agreement (the “Title Review Period”) Purchaser shall have the right to examine title to the Real

(b)

Environmental Matters and Physical Inspections. For the period commencing on the date of this Agreement and extending through the forty-fifth (45^th) day after the date of this Agreement (the “Inspection Period”), Purchaser shall have the right, subject to the provisions of this Section 1.10(b), to conduct such investigations of the Real Property as it may reasonably require in order to identify any Environmental Issue or Inspection Issue, as herein defined. As used herein, the term “Inspection Issue” shall mean a physical condition discovered by Purchaser’s investigation during the Inspection Period that materially affects the value of the Real Property or the use of the Real Property as a Banking Center, including, without limitation, compliance of the Real Property with the provisions of the Americans with Disabilities Act. As used herein, the term “Environmental Issue” shall mean a physical condition discovered by Purchaser’s investigation during the Inspection Period that constitutes a material violation of applicable environmental law that materially affects the value of the Real Property or the use of the Real Property as a Banking Center, or any material condition at or under the Real Property that would reasonably be expected to give rise to a material liability under applicable environmental law including, without limitation, clean-up and remediation obligations.

(c)

Correction of Title Defects, Environmental Issues and Inspection Issues. If Purchaser raises any Title Defects, Environmental Issue or Inspection Issue in accordance with subsection (a) or (b) of this Section 1.10 that would, in aggregate, require the expenditure of over $5,000 to correct, as determined by Purchaser in its reasonable discretion (the “Defects”), Seller shall have the obligation to pay up to the sum of $15,000 to cure such Defects prior to the Effective Time, if practicable, or as soon thereafter as can reasonably be accomplished. For the avoidance of any doubt, Purchaser shall pay the first $5,000 of the aggregate cost of curing the

(a)

All actions taken and documents delivered at the Closing shall be deemed to have been taken and executed simultaneously, and no action shall be deemed taken nor any document delivered until all have been taken and delivered.

(b)

At the Closing, subject to all the terms and conditions of this Agreement, Seller shall execute (where appropriate) and deliver or make reasonably available to Purchaser:

(1)

A Special Warranty Deed, in substantially the form attached as Exhibit 2.2(b)(1) (the “Deed”), conveying to Purchaser unencumbered, marketable, fee simple title to the Real Property, together with all keys and access or security codes required for access to all or any portion of the Real Property;

(2)

A ▇▇▇▇ of Sale, in substantially the form attached as Exhibit 2.2(b)(2) (the “▇▇▇▇ of Sale”), transferring to Purchaser all of Seller’s interest in the Personal Property, the Overdraft Loans and other assets, together with all keys and access or security codes required for access thereto;

(3)

An Assignment and Assumption Agreement, in substantially the form attached as Exhibit 2.2(b)(3) (the “Assignment and Assumption Agreement”), assigning Seller’s interest in the Safe Deposit Contracts and the Deposit Liabilities;

(4)

Consents from third persons, if any, that are required to effect the assignments set forth in the Assignment and Assumption Agreement;

(5)

Seller’s keys to the safe deposit boxes, Seller’s records related to the safe deposit box business at the Banking Center and Seller’s keys to the night deposit bags used by customers for deposits at the Banking Center;

(6)

Seller’s files and records related to the Overdraft Loans, including, without limitation, original executed notes, instruments and other documents;

(7)

Any collateral securing the Overdraft Loans in Seller’s possession or control;

(8)

Seller’s records related to the Deposit Liabilities assumed by Purchaser;

(9)

Immediately available funds in the net amount shown as owing to Purchaser by Seller on the Closing Statement, if any;

(10)

The Coins and Currency;

(11)

Such of the other assets to be purchased as shall be capable of physical delivery;

(12)

A certificate of a proper officer of Seller, dated as of the date of Closing, certifying the satisfaction of all conditions that are the obligation of Seller and that all of the representations and warranties of Seller set forth in this Agreement remain true and correct in all material respects as of the Effective Time;

(13)

A certified copy of a resolution of the Board of Directors of Seller, or its Executive Committee, approving the sale of the Banking Center contemplated hereby;

(14)

Such certificates and other documents as Purchaser and its counsel may reasonably require to evidence the receipt by Seller of all necessary corporate and regulatory authorizations and approvals for the consummation of the transactions provided for in this Agreement;

(15)

A Closing Statement, substantially in the form attached as Exhibit 2.2(b)(14) (the “Closing Statement”);

(16)

The Pre-Closing Balance Sheet;

(17)

An affidavit of Seller certifying that Seller is not a “foreign person” as defined in the federal Foreign Investment in Real Property Tax Act of 1980;

(18)

The Power of Attorney substantially in the form attached as Exhibit 1.4(k);

(19)

Such executed customary affidavits and documents as Purchaser’s title insurer may require as a condition to issuing an owner’s title insurance policy to Purchaser with respect to the Real Property; and

(20)

A schedule of deposit accounts with holds on them for clearance of individual items of $10,000 or more.

(c)

At the Closing, subject to all the terms and conditions of this Agreement, Purchaser shall execute (where appropriate) and deliver to Seller:

(1)

The Assignment and Assumption Agreement;

(2)

A certificate and receipt acknowledging the delivery and receipt of possession of the property and records referred to in this Agreement;

(3)

Immediately available funds in the net amount shown as owing to Seller by Purchaser on the Closing Statement, if any;

(4)

A certificate of a proper officer of Purchaser, dated as of the date of Closing, certifying the satisfaction of all conditions that are the obligation of Purchaser and that all of the representations and warranties of Purchaser set forth in this Agreement remain true and correct in all material respects as of the Effective Time;

(5)

A certified copy of a resolution of the Board of Directors, or its Executive Committee, of Purchaser approving the purchase of the Banking Center contemplated hereby;

(6)

Such certificates and other documents as Seller and its counsel may reasonably require to evidence the receipt by Purchaser of all necessary corporate and regulatory authorizations and approvals for the consummation of the transactions provided for in this Agreement; and

(7)

The Closing Statement.

(d)

All instruments, agreements and certificates described in this Section 2.2 shall be in form and substance reasonably satisfactory to the parties’ respective legal counsel.

(a)

Not later than 20 business days after the Effective Time, Seller shall deliver to Purchaser a balance sheet dated as of the Effective Time and prepared in accordance with customary banking practices reflecting the assets sold and assigned and the liabilities transferred and assumed hereunder (including any adjustments to the same required by this Agreement) (the “Post-Closing Balance Sheet”). In addition, Seller shall deliver to Purchaser within 10 days following the Closing a list of Overdraft Loans purchased, individually identified by account number, and a list of all Deposit Liabilities assumed, individually identified by account number, each list as of the Effective Time, which lists shall also be appended to the ▇▇▇▇ of Sale. Seller shall afford Purchaser and its accountants and attorneys the opportunity to review all work papers and documentation used by Seller in preparing the Post-Closing Balance Sheet. Within 15 business days following delivery of the Post-Closing Balance Sheet (the “Adjustment Payment Date”), Seller and Purchaser shall effect the transfer of any funds by wire transfer as may be necessary to reflect changes in such assets and liabilities between the Pre-Closing Balance Sheet and the Post-Closing Balance Sheet, together with interest thereon computed from the Effective Time to the Adjustment Payment Date at the applicable Federal Funds Rate (as hereafter defined).

(b)

If a dispute arises as to the appropriate amounts to be paid to either party on the Adjustment Payment Date, each party shall pay to the other on such Adjustment Payment Date all amounts other than those as to which a dispute exists. Any disputed amounts retained by a party that are later found to be due to the other party shall be paid to such other party promptly upon resolution with interest thereon from the Adjustment Payment Date to the date paid at a per annum rate (calculated daily based on a 360 day year) equal to the applicable Federal Funds Rate. In the event of such a dispute, personnel one level senior to the personnel handling the dispute for both parties will attempt to resolve the dispute using their good faith business judgment. If such discussions do not resolve a dispute, either party may submit the matter to a firm of certified public accountants mutually agreeable to Seller and Purchaser (the “Mediator”), which shall determine such dispute in accordance with the terms and conditions of this Agreement within 30 calendar days after the submission. The parties shall each pay one-half of the fees and expenses of the Mediator. The Post-Closing Balance Sheet, as agreed upon by the parties and determined under this subsection, shall be final and binding upon the parties.

(c)

The Federal Funds Rate shall mean the rate quoted for Federal Funds in the Money Rates Column of the Wall Street Journal, adjusted daily, for the period beginning with the first calendar day following the Effective Time and ending with the Adjustment Payment Date.

(a)

A claim for indemnity under Sections 3.1 or 3.2 of this Agreement shall be made by the claiming party prior to the first anniversary of the date on which the Effective Time occurred by the giving of written notice thereof to the other party. Such notice shall set forth in reasonable detail the basis upon which such claim for indemnity is made. If any such claim is made within such period, the indemnity relating to such claim shall survive until such claim is resolved. Claims not made within such period shall not be eligible for indemnification and shall be deemed waived and relinquished.

(b)

If any person or entity not a party to this Agreement shall make any demand or claim or file or threaten to file any lawsuit, which demand, claim or lawsuit may result in any liability, damage or loss to one party hereto of the kind for which such party is entitled to indemnification pursuant to Section 3.1 or 3.2, then, after written notice is provided by the indemnified party to the indemnifying party of such demand, claim or lawsuit, the indemnifying party shall have the option, at its cost and expense, to retain counsel for the indemnified party to defend any such demand, claim or lawsuit. If the indemnifying party shall fail to respond within 10 business days after receipt of such notice of any such demand, claim or lawsuit, then the indemnified party shall retain counsel and conduct the defense of

(a)

Notwithstanding the provisions of Section 3.1 and 3.2, in no event will the aggregate liability of Seller under Section 3.1, or Purchaser under Section 3.2, exceed the Purchase Price.

(b)

Notwithstanding anything to the contrary in this Agreement, including Sections 3.1, 3.2 and 3.4(a), the limitations set forth in Section 3.4(a) shall not apply to any Loss relating to, arising out of or resulting from fraudulent misrepresentation or fraudulent breach of any warranty or any claim with respect to fraudulent inducement to enter into this Agreement.

(c)

Notwithstanding anything to the contrary in this Agreement, the parties shall have no obligations under this Article III for any indirect or consequential liability, damage or loss that the indemnified party may suffer or for punitive damages.

Seller hereby represents and warrants to Purchaser as follows:

(a)

Except as specifically set forth herein, Seller has no Knowledge of any condemnation proceedings pending against the Real Property and, to the Knowledge of Seller, no such proceeding is threatened or proposed.

(b)

Except as specifically set forth herein, Seller has not entered into any agreement regarding the Real Property, and the Real Property is not subject to any claim, demand, suit, lien, proceeding or litigation of any kind, pending or outstanding, or to the Knowledge of Seller, threatened or likely to be made or instituted, that would in any way be binding upon Purchaser or its successors or assigns or affect or limit Purchaser’s or its successors’ or assigns’ use and enjoyment of the Real Property or that would limit or restrict Seller’s right or ability to enter into this Agreement and consummate the sale and purchase contemplated hereby.

(c)

Seller has and will convey to Purchaser at the Closing good and marketable fee simple title to the Real Property subject to no Title Defects, except as provided for under Section 1.10.

Purchaser hereby represents and warrants to Seller as follows:

(a)

From the date hereof until the Effective Time, Seller covenants that it will:

(i)

Carry on, or cause to be carried on, the business of the Banking Center substantially in the same manner as on the date hereof, use all reasonable efforts to preserve intact its current business organization, and preserve its business relationships with depositors, customers and others having business relationships with it and whose accounts will be retained at the Banking Center; provided, that Seller need not, in its sole discretion, advertise or promote new or substantially new customer services in the principal market area of the Banking Center;

(ii)

Cooperate with and assist Purchaser in assuring the orderly transition of the business of the Banking Center to Purchaser from Seller; and

(iii)

Maintain the Real Property and the Personal Property in their current condition, ordinary wear and tear excepted.

(b)

Between the date hereof and the Effective Time, Seller shall not, without the prior written consent of Purchaser:

(i)

Acquire or dispose of any fixed assets with respect to the Banking Center, except for replacement of furniture, furnishings and equipment and normal maintenance and refurbishing in the ordinary course of business of the Banking Center, provided that this Section shall not require the replacement of any such items by Seller;

(ii)

Increase or agree to increase the salary, remuneration, compensation or other employment benefits of persons employed at the Banking Center other than in accordance with Seller’s customary policies or bank-wide changes consistent with past practices, or pay or agree to pay any uncommitted bonus to any such employees other than regular bonuses granted based on historical practice;

(iii)

Advertise or promote new customer services or products in the market area of the Banking Center without obtaining the prior written consent of Purchaser, or otherwise change any pricing in deposit accounts to increase rates on deposit accounts at the Banking Center above market rates in the principal market area of the Banking Center;

(iv)

Materially increase the staffing levels at the Banking Center or effect changes in branch personnel employed as of the Effective Time other than in the ordinary course of business consistent with past practices; or

(v)

Enter into any agreement to sell, grant or convey the Real Property, the Personal Property or any part thereof.

(a)

Purchaser shall have received all necessary regulatory approvals of the transactions provided in this Agreement (including, without limitation, the

(b)

Such approvals shall not have imposed any condition that is materially disadvantageous or burdensome to Purchaser.

(a)

Purchaser shall have received from the appropriate regulatory authorities approval of the transactions contemplated herein, waiting periods required by law to pass shall have passed, no proceeding to enjoin, restrain, prohibit or invalidate such transactions shall have been instituted or threatened, and any conditions of any regulatory approval shall have been met.

(b)

Such approvals shall not have imposed any condition that is materially disadvantageous or burdensome to Seller.

(a)

by either Purchaser or Seller, in writing five calendar days in advance of such termination, if the Closing has not occurred by the date set forth in the last sentence of Section 2.1 hereof;

(b)

at any time on or prior to the Effective Time by the mutual consent in writing of Purchaser and Seller;

(c)

by Purchaser in writing if the conditions set forth in Article VII (with the exception of delivery of items required to be delivered at Closing) of this Agreement shall not have been met by Seller or waived in writing by Purchaser within 30 calendar days following the date of all approvals by regulatory agencies and after all statutory waiting periods have expired;

(d)

by Seller in writing if the conditions set forth in Article VIII of this Agreement shall not have been met by Purchaser or waived in writing by Seller within 30 calendar days following the date of all approvals by regulatory agencies and after all statutory waiting periods have expired;

(e)

any time prior to the Effective Time, by Purchaser or Seller in writing if the other shall have been in breach of any representation and warranty in any material respect (as if such representation and warranty had been made on and as of the date hereof and on the date of the notice of breach referred to below), or in breach of any covenant, undertaking or obligation contained herein, and such breach has not been cured by the earlier of 30 calendar days after the giving of notice to the breaching party of such breach or the Effective Time; provided, however, that there shall be no cure period in connection with any breach of Section 6.3, so long as such breach by Purchaser was not caused by any action or inaction of Seller, and Seller may terminate this Agreement immediately if regulatory applications are not filed within the period provided in that Section; or

(f)

by Seller or Purchaser in writing at any time after any applicable regulatory authority has denied approval of any application of Purchaser for approval of the

(g)

With respect to any Title Defect, Environmental Issue or Inspection Issue, only as expressly provided in Section 1.10(d);

If this Agreement is terminated as provided herein,

(a)

each party will return all documents, work papers and other materials of the other party, including photocopies or other duplications thereof, relating to this transaction, whether obtained before or after the execution hereof, to the party furnishing the same; and

(b)

all information received by either party hereto with respect to the business of the other party (other than information that is a matter of public knowledge or that heretofore has been published in any publication for public distribution or filed as public information with any governmental authority) shall not at any time be used for any business purpose by such party or disclosed by such party to third persons.

Phone: (▇▇▇) ▇▇▇-▇▇▇▇

Fax: (▇▇▇) ▇▇▇-▇▇▇▇

E-mail: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇

Executive Vice President and Chief Administrative Officer

with a copy to:

Phone: (▇▇▇) ▇▇▇-▇▇▇▇

Fax: (▇▇▇) ▇▇▇-▇▇▇▇

E-mail: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇

SELLER:

STELLARONE BANK

By:

/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇

Name:

▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇

Title:

EVP/CFO

Date:

July 10, 2009

PURCHASER:

FIRST BANK

By:

/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇

Name:

▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇

Title:

EVP-Chief Administrative Officer

Date:

July 9, 2009