Common use of Allowance for Loan Losses Clause in Contracts

Allowance for Loan Losses. The allowance for loan losses reflected in reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policies. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK has disclosed to OLB on BYBK Disclosure Schedule 3.21 all Credit Extensions (including participations) by and all interest-bearing assets of the BYBK Companies (a) that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK shall provide an updated BYBK Disclosure Schedule 3.21 promptly to OLB after the end of each month after the date hereof and on the Business Day prior to the Closing Date. The REO and in-substance foreclosures included in any of Bay Bank’s non-performing assets are carried at fair value based on current independent appraisals or current management appraisals.

Allowance for Loan Losses. The allowance for loan losses reflected in OLB’s and Old Line’s reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK OLB Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK OLB has disclosed to Holdings on OLB on BYBK Disclosure Schedule 3.21 4.20 the amounts of all Credit Extensions (including participations) by loans, leases, advances, credit enhancements, other extensions of credit, commitments and all interest-bearing assets of the BYBK Companies (a) OLB that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party OLB has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policyimport, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK OLB shall provide an updated BYBK Disclosure Schedule 3.21 disclose promptly to OLB Holdings after the end of each month after the date hereof and on the Business Day prior to the Closing DateDate the amount of each such classification on an updated OLB Disclosure Schedule 4.20. The REO and in-substance foreclosures included in any of Bay BankOld Line’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals. Furthermore, true, complete and materially correct copies of reports containing the amounts of all loans, leases, advances, credit enhancements, other extensions of credit, commitments and interest-bearing assets of Old Line that Old Line has classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans” or words of similar import occurring since July 31, 2010 shall be disclosed promptly to Holdings on an updated OLB Disclosure Schedule 4.20.

Allowance for Loan Losses. The allowance for loan losses reflected in Holdings’ and WSB’s reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK Holdings Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK Holdings has disclosed to OLB on BYBK Holdings Disclosure Schedule 3.21 the amounts of all Credit Extensions (including participations) by loans, leases, advances, credit enhancements, other extensions of credit, commitments and all interest-bearing assets of the BYBK Companies (a) Holdings that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party Holdings has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policyimport, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK Holdings shall provide an updated BYBK Disclosure Schedule 3.21 disclose promptly to OLB after the end of each month after the date hereof and on the Business Day prior to the Closing DateDate the amount of each such classification on an updated Holdings Disclosure Schedule 3.21. The REO and in-substance foreclosures included in any of Bay BankWSB’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals. Furthermore, true, complete and materially correct copies of reports containing the amounts of all loans, leases, advances, credit enhancements, other extensions of credit, commitments and interest-bearing assets of WSB that WSB has classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans” or words of similar import occurring since July 31, 2012 shall be disclosed promptly to OLB on an updated Holdings Disclosure Schedule 3.21.

Allowance for Loan Losses. The allowance for loan losses reflected in RBI’s and Regal’s reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK RBI Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such RBI’s and Regal’s reports to each Regulatory Authority and the allowance for loan losses shown in the BYBK RBI Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK RBI has disclosed to OLB on BYBK RBI Disclosure Schedule 3.21 all Credit Extensions (including participations) by and all interest-bearing assets of the BYBK Companies RBI or any RBI Subsidiary (a) that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party has notified RBI or any of the BYBK Companies RBI Subsidiary during the past 12 months of, or has asserted against RBI or any of the BYBK CompaniesRBI Subsidiary, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBKRBI, each borrower, customer or other party that has given RBI or any of the BYBK Companies RBI Subsidiary any oral notification of, or orally asserted to or against RBI or any of the BYBK CompaniesRBI Subsidiary, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, and (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014import, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK RBI shall provide an updated BYBK update RBI Disclosure Schedule 3.21 promptly to OLB after the end of each month after the date hereof and on the Business Day prior to the Closing Date. The REO and in-substance foreclosures included in any of Bay BankRegal’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals.

Allowance for Loan Losses. The allowance for loan losses reflected in FNB’s and Bank’s reports by the BYBK Companies to each Regulatory Authority Authorities has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK FNB Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK FNB has disclosed to OLB Tower on BYBK FNB Disclosure Schedule 3.21 3.19 the amounts of all Credit Extensions (including participations) by loans, leases, advances, credit enhancements, other extensions of credit, commitments and all interest-bearing assets of the BYBK Companies (a) FNB that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party FNB has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policyimport, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK FNB shall provide an updated BYBK Disclosure Schedule 3.21 disclose promptly to OLB Tower after the end of each month after the date hereof and on the Business Day business day prior to the Closing DateDate the amount of each such classification on an updated FNB Disclosure Schedule 3.19. FNB has disclosed to Tower on FNB Disclosure Schedule 3.19 the amounts of all overdrafts occurring since January 1, 2005 and FNB shall disclose promptly to Tower after the end of each month after the date hereof and on the business day before the Effective Date the amount of such overdrafts. The REO OREO and in-substance foreclosures included in any of Bay BankFNB’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals. Furthermore, true, complete and materially correct copies of reports containing the amounts of all loans, leases, advances, credit enhancements, other extensions of credit, commitments and interest-bearing assets of FNB that FNB has classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans” or words of similar import and the amounts of all overdrafts occurring since January 1, 2005 are attached hereto on the FNB Disclosure Schedule 3.19 of this Agreement.

Allowance for Loan Losses. The allowance for loan losses reflected in HBI’s and HBank’s reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK HBI Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such HBI’s and HBank’s reports to each Regulatory Authority and the allowance for loan losses shown in the BYBK HBI Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK HBI has disclosed to OLB PBI on BYBK HBI Disclosure Schedule 3.21 4.20 all Credit Extensions (including participations) by and all interest-bearing assets of the BYBK Companies HBI or any HBI Subsidiary (a) that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party has notified HBI or any of the BYBK Companies HBI Subsidiary during the past 12 months of, or has asserted against HBI or any of the BYBK CompaniesHBI Subsidiary, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBKHBI, each borrower, customer or other party that has given HBI or any of the BYBK Companies HBI Subsidiary any oral notification of, or orally asserted to or against HBI or any of the BYBK CompaniesHBI Subsidiary, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, and (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014import, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK HBI shall provide an updated BYBK update HBI Disclosure Schedule 3.21 4.20 promptly to OLB PBI after the end of each month after the date hereof and on the Business Day prior to the Closing Date. The REO and in-substance foreclosures included in any of Bay BankHBank’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals.

Allowance for Loan Losses. The allowance for loan losses reflected in Bay Net Financial’s and Bank’s reports by the BYBK Companies to each Regulatory Authority Authorities has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK Financials Bay Net Financial Statements has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with GAAP. Bay Bank’s internal policies. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK Net Financial has disclosed to OLB on BYBK Disclosure Schedule 3.21 Sterling in writing prior to the date hereof the amounts of all Credit Extensions (including participations) by loans, leases, advances, credit enhancements, other extensions of credit, commitments and all interest-bearing assets of the BYBK Companies (a) Bay Net Financial that have been accelerated during the past 12 monthsBay Net Financial has classified internally, (b) that have been terminated during the past 12 months by reason as of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrowerDecember 31, (c) pursuant to which a borrower2005, customer or other party has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authorityimport, (g) and Bay Net Financial shall disclose to Sterling, promptly after the Knowledge end of BYBK, as to which a reasonable doubt exists as to each fiscal quarter of Bay Net Financial after the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three yearsdate hereof, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension classification. Bay Net Financial has disclosed to Sterling in writing prior to the date hereof the amounts of all overdrafts greater than $500.00 and interest-bearing asset outstanding as of December 31, 2005 and the identity of the obligor thereunder, and BYBK Bay Net Financial shall provide an updated BYBK Disclosure Schedule 3.21 disclose promptly to OLB Sterling after the end of each month after the date hereof and on the Business Day prior to Effective Time the Closing Dateamount of such overdrafts. The REO real estate owned and in-substance foreclosures included in any of Bay BankNet Financial’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals. Furthermore, true, complete and materially correct copies of reports containing the amounts of all loans, leases, advances, credit enhancements, other extensions of credit, commitments and interest bearing assets of Bay Net Financial that Bay Net Financial has classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans” or words of similar import and the amounts of all overdrafts greater than $500.00 and outstanding as of December 31, 2005 are attached hereto on Bay Net Disclosure Schedule 3.19 of this Agreement.

Allowance for Loan Losses. The allowance for loan losses reflected in reports by the BYBK DCB Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK DCB Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s Damascus’ internal policies. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK DCB Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK DCB has disclosed to OLB on BYBK DCB Disclosure Schedule 3.21 all Credit Extensions (including participations) by and all interest-bearing assets of the BYBK DCB Companies (a) that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party has notified any of the BYBK DCB Companies during the past 12 months of, or has asserted against any of the BYBK DCB Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBKDCB, each borrower, customer or other party that has given any of the BYBK DCB Companies any oral notification of, or orally asserted to or against any of the BYBK DCB Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK DCB Company or any Regulatory Authority, (g) to the Knowledge of BYBKDCB, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK DCB shall provide an updated BYBK DCB Disclosure Schedule 3.21 promptly to OLB after the end of each month after the date hereof and on the Business Day prior to the Closing Date. The REO and in-substance foreclosures included in any of Bay Bank’s Damascus’ non-performing assets are carried at fair value based on current independent appraisals or current management appraisals.

Allowance for Loan Losses. The Loan and Investment Portfolios, etc. (a) SB’s allowance for loan losses reflected in reports by the BYBK Companies to each Regulatory Authority is, and has been and will be established since January 1, 2018, in material compliance with SB’s methodology for determining the requirements adequacy of all regulatory criteria, and the its allowance for loan losses shown in the BYBK Financials has been and will be established and maintained in accordance with GAAP and GAAP, as well as the standards established by applicable Law and in a manner consistent with Bay Bank’s internal policies. The allowance for loan losses reflected in such reports Governmental Authorities and the allowance for loan losses shown in the BYBK FinancialsFinancial Accounting Standards Board, in all material respects. (b) As of the opinion date hereof, all loans, discounts and leases (in which any SB Entity is lessor) reflected on SB Financial Statements were, and with respect to the consolidated balance sheets delivered as of management, was or the dates subsequent to the execution of this Agreement will be adequate as of the dates thereof. BYBK has disclosed to OLB on BYBK Disclosure Schedule 3.21 all Credit Extensions (including participations) by and all interest-bearing assets of the BYBK Companies (a) that have been accelerated during the past 12 months, (bi) that have been terminated during at the past 12 months by reason of a default or adverse development time and under the circumstances in which made, made for good, valuable and adequate consideration in the condition ordinary course of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, business and, to the Knowledge of BYBKSB, each borrowerare the legal and binding obligations of the obligors thereof, customer (ii) evidenced by genuine notes, agreements, or other party that has given any evidences of indebtedness, and (iii) to the extent secured, have, to the Knowledge of SB, been secured by valid liens and security interests which have been perfected. Accurate lists of all loans, discounts, and financing leases as of March 31, 2021 and on a monthly basis thereafter, and of the BYBK Companies investment portfolios of each SB Entity as of such date, have been and will be made available to Buyer. Except as specifically set forth in Section 4.9(b) of the SB Disclosure Memorandum, neither SB nor Bank is a party to any written or oral notification ofloan agreement, note, or orally asserted to or against borrowing arrangement, including any loan guaranty, that was, as of the BYBK Companies, any such claim, most recent month-end (di) that are contractually past due 90 delinquent by more than 30 days or more in the payment of principal and/or or interest, (eii) that are on non-accrual statusotherwise in material Default for more than 30 days, (fiii) that are classified as “Other Loans Specially Mentionedsubstandard,” “Special Mentiondoubtful,” “Substandardloss,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch Listother assets especially mentioned” or words of similar import any comparable classification by SB or by any BYBK Company or any applicable Regulatory Authority, (giv) an obligation of any director, executive officer or 10% shareholder of any SB Entity who is subject to Regulation O of the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, Federal Reserve (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k12 C.F.R. Part 215), have been charged-off at or any time since January 1person, 2014corporation or enterprise controlling, together controlled by or under common control with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity any of the obligor thereunderforegoing, and BYBK shall provide an updated BYBK Disclosure Schedule 3.21 promptly to OLB after the end or (v) in material violation of each month after the date hereof and on the Business Day prior to the Closing Date. The REO and in-substance foreclosures included in any of Bay Bank’s non-performing assets are carried at fair value based on current independent appraisals or current management appraisalsLaw.

Allowance for Loan Losses. The allowance for loan losses reflected in OLB’s and Old Line’s reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK OLB Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK OLB has disclosed to MDBC on OLB on BYBK Disclosure Schedule 3.21 4.21 the amounts of all Credit Extensions (including participations) by loans, leases, advances, credit enhancements, other extensions of credit, commitments and all interest-bearing assets of the BYBK Companies (a) OLB that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party OLB has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policyimport, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK OLB shall provide an updated BYBK Disclosure Schedule 3.21 disclose promptly to OLB MDBC after the end of each month after the date hereof and on the Business Day prior to the Closing DateDate the amount of each such classification on an updated OLB Disclosure Schedule 4.21. The REO OREO and in-substance foreclosures included in any of Bay BankOld Line’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals. Furthermore, true, complete and materially correct copies of reports containing the amounts of all loans, leases, advances, credit enhancements, other extensions of credit, commitments and interest-bearing assets of Old Line that Old Line has classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans” or words of similar import occurring since July 31, 2010 shall be disclosed promptly to MDBC on an updated OLB Disclosure Schedule 4.21.

Allowance for Loan Losses. The Except as disclosed in Schedule 3.1(t) of the BancSecurity Disclosure Schedule, BancSecurity's consolidated allowance for loan losses reflected on loans included in reports by the BYBK Companies to each Regulatory Authority has been and will be established Financial Statements as of September 30, 1997 was $5,517,305.00, representing 1.66% of its total consolidated loans held in compliance with portfolio. In BancSecurity's reasonable judgment, the requirements amount of all regulatory criteria, and the such allowance for loan losses shown on loans was adequate to absorb reasonably expectable losses in the BYBK Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesloan portfolio of the Banks. The To the knowledge of BancSecurity, there are no facts which would require it to increase the level of such allowance for loan losses reflected in such reports and on loans. There are no loans, leases, other extensions of credit or commitments to extend credit of the allowance for loan losses shown in the BYBK Financials, Banks that in the opinion of managementmanagement for BancSecurity, was should have been or will be adequate should in accordance with GAAP, have been classified by the Banks as nonaccrual, as restructured, as 90 days past due, as still accruing and doubtful of collection or any comparable classification. BancSecurity and the dates thereof. BYBK has Banks have disclosed to OLB on BYBK Disclosure Schedule 3.21 Buyer in writing prior to the date hereof the amounts of all Credit Extensions (including participations) by loans, leases, advances, credit enhancements, other extensions of credit, commitments and all interest-bearing assets of the BYBK Companies (a) Banks that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified as “of September 30, 1997 as "Other Loans Specially Mentioned,” “" "Special Mention,” “" "Substandard,” “" "Doubtful,” “" "Loss,” “" "Classified,” “" "Criticized,” “" "Delinquent Loans," "Credit Risk Assets,” “" "Concerned Loans,” “Watch List” " (in the latter two cases, to the extent available) or words of similar import by any BYBK Company or any Regulatory Authority, (g) import. BancSecurity has provided to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which Buyer such written information concerning the loan was originally created due to concerns regarding portfolios of the borrower’s ability to pay in accordance with such initial termsBanks as Buyer has requested, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with which information is true, correct and complete in all material respects. From and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK shall provide an updated BYBK Disclosure Schedule 3.21 promptly to OLB after the end of each month after the date hereof hereof, BancSecurity and on the Business Day prior Banks promptly will provide Buyer with a copy of each quarterly classified asset report and a delinquency trend report it provides to the Closing Dateits Board of Directors. The REO and in-substance foreclosures OREO included in any of Bay Bank’s non-performing assets are of BancSecurity is carried net of reserves at the lower of cost or fair value based on current independent appraisals or current management appraisalsvalue.

Allowance for Loan Losses. The allowance for loan losses reflected in MDBC’s and MDB&T’s reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK MDBC Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such reports and the allowance for loan losses shown in the BYBK Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK MDBC has disclosed to OLB on BYBK MDBC Disclosure Schedule 3.21 the amounts of all Credit Extensions (including participations) by loans, leases, advances, credit enhancements, other extensions of credit, commitments and all interest-bearing assets of the BYBK Companies (a) MDBC that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party MDBC has notified any of the BYBK Companies during the past 12 months of, or has asserted against any of the BYBK Companies, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBK, each borrower, customer or other party that has given any of the BYBK Companies any oral notification of, or orally asserted to or against any of the BYBK Companies, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policyimport, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK MDBC shall provide an updated BYBK Disclosure Schedule 3.21 disclose promptly to OLB after the end of each month after the date hereof and on the Business Day prior to the Closing DateDate the amount of each such classification on an updated MDBC Disclosure Schedule 3.21. The REO OREO and in-substance foreclosures included in any of Bay BankMDB&T’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals. Furthermore, true, complete and materially correct copies of reports containing the amounts of all loans, leases, advances, credit enhancements, other extensions of credit, commitments and interest-bearing assets of MDB&T that MDB&T has classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans” or words of similar import occurring since July 31, 2010 shall be disclosed promptly to OLB on an updated MDBC Disclosure Schedule 3.21.

Allowance for Loan Losses. The allowance for loan losses reflected in PBI’s and PBank’s reports by the BYBK Companies to each Regulatory Authority has been and will be established in compliance with the requirements of all regulatory criteria, and the allowance for loan losses shown in the BYBK PBI Financials has been and will be established and maintained in accordance with GAAP and applicable Law and in a manner consistent with Bay Bank’s internal policiesGAAP. The allowance for loan losses reflected in such PBI’s and PBank’s reports to each Regulatory Authority and the allowance for loan losses shown in the BYBK PBI Financials, in the opinion of management, was or will be adequate as of the dates thereof. BYBK PBI has disclosed to OLB HBI on BYBK PBI Disclosure Schedule 3.21 all Credit Extensions (including participations) by and all interest-bearing assets of the BYBK Companies PBI or any PBI Subsidiary (a) that have been accelerated during the past 12 months, (b) that have been terminated during the past 12 months by reason of a default or adverse development in the condition of the borrower or other events or circumstances affecting the credit of the borrower, (c) pursuant to which a borrower, customer or other party has notified PBI or any of the BYBK Companies PBI Subsidiary during the past 12 months of, or has asserted against PBI or any of the BYBK CompaniesPBI Subsidiary, in each case in writing, any “lender liability” or similar claim, and, to the Knowledge of BYBKPBI, each borrower, customer or other party that has given PBI or any of the BYBK Companies PBI Subsidiary any oral notification of, or orally asserted to or against PBI or any of the BYBK CompaniesPBI Subsidiary, any such claim, (d) that are contractually past due 90 days or more in the payment of principal and/or interest, (e) that are on non-accrual status, and (f) that are classified internally as “Other Loans Specially Mentioned,” “Special Mention,” “Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import by any BYBK Company or any Regulatory Authority, (g) to the Knowledge of BYBK, as to which a reasonable doubt exists as to the timely future collectability of principal and/or interest, whether or not interest is still accruing or the loans are less than 90 days past due, (h) where, during the past three years, the interest rate terms have been reduced and/or the maturity dates have been extended subsequent to the agreement under which the loan was originally created due to concerns regarding the borrower’s ability to pay in accordance with such initial terms, (i) where a specific reserve allocation exists in connection therewith, (j) that are required to be accounted for as a troubled debt restructuring in accordance with Statement of Financial Accounting Standards No. 15, (k) that were made pursuant to an exception to policy, and (l) that, to the extent not already disclosed pursuant to the foregoing items (a) through (k), have been charged-off at any time since January 1, 2014import, together with true, complete and materially correct copies of reports containing the principal amount and accrued and unpaid interest of each such Credit Extension and interest-bearing asset and the identity of the obligor thereunder, and BYBK PBI shall provide an updated BYBK update PBI Disclosure Schedule 3.21 promptly to OLB HBI after the end of each month after the date hereof and on the Business Day prior to the Closing Date. The REO and in-substance foreclosures included in any of Bay BankPBank’s non-performing assets are carried net of reserves at fair the lower of cost or market value based on current independent appraisals or current management appraisals.