SUBORDINATED DEBT LOAN AGREEMENT

THIS SUBORDINATED DEBT LOAN AGREEMENT (this " Agreement ")   is made and entered into as of June 30, 2008, by and between COMMUNITYONE BANK, NATIONAL ASSOCATION,   a national banking association  (the “ Borrower ”), and SUNTRUST BANK, a Georgia banking corporation (the " Lender ").

WHEREAS, the Borrower has requested the Lender, and the Lender has agreed, subject to the terms and conditions of this Agreement, to make a $15,000,000 seven (7) year subordinated term loan that will qualify as Tier II capital.

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

Section 1.1.   Definitions .  In addition to the other terms defined herein, the following terms used herein shall have the meanings herein specified (to be equally applicable to both the singular and plural forms of the terms defined):

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

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

“ Change in Law” shall mean (i) the adoption of any applicable law, rule or regulation after the date of this Agreement, (ii) any change in any applicable law, rule or regulation, or any change in the interpretation or application thereof, by any Governmental Authority after the date of this Agreement, or (iii) compliance by the Lender (or for purposes of Section 2.5 ( b ), by the Lender’s holding company, if applicable) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement.

“ Company” shall mean FNB United Corp., a North Carolina corporation.

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

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

“ FR Report Y9-LP ” shall mean the “Parent Company Only Financial Statements for Large Bank Holding Companies-FR Y-9LP” submitted by the Company as required by Section 5(c) of the Bank Holding Company Act (12 U.S.C. 1844) and Section 225.5(b) of Regulation Y [12 CFR 225.5(b)], or any successor or similar replacement report.

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

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

" Loan Documents " shall mean, collectively, this Agree­ment, the Subordinated Note, [any Hedging Agreement   entered into with Lender in connection with the Indebtedness under this Agreement or the Subordinated Note] and any and all other instruments, agreements, documents and writings executed by the Borrower in connection with any of the foregoing.

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

Maturity Date” shall mean June 30, 2015.

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

“ Revolving Credit Agreement” shall mean that certain Revolving Credit Agreement dated as of May 27, 2008 between the Company and the Lender.

“ Subordinated Term Loan” shall mean the Fifteen Million Dollar ($15,000,000) term loan made to the Borrower by the Lender pursuant to the Subordinated Note and this Agreement.

“Subordinated Note” shall mean that certain Floating Rate Subordinated Note due 2015 dated June 30, 2008 made by the Borrower in favor of the Lender in the form attached as Exhibit A hereto.

                      “ Subsidiary ” shall mean, with respect to any Person (the “ parent ”), any corporation, part­nership, joint venture, limited liability company, association or other entity the accounts of which would be consolidated with those of the parent in the parent's consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, part­nership, joint venture, limited liability company, association or other entity (i) of which securities  or other ownership interests representing more than 30% of the equity  or more than 30% of  the ordinary voting power, or in the case of a partnership, more than 30% of the general partnership interests are, as of such date, owned, controlled or held, or (ii) that is, as of such date, otherwise controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent. Unless otherwise indicated, all references to "Subsidiary" hereunder shall mean a Subsidiary of the Company.

Section 1.2.   Terms Generally .   The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  The words "include", "includes" and "including" shall be deemed to be followed by the phase "without limitation".  In the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including" and the word "to" means "to but excluding". Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as it was originally executed or as it may from time to time be amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person's successors and permitted assigns, (iii) the words "hereof", "herein" and "hereunder" and words of similar import shall be construed to refer to this Agreement as a whole and not to any particular provision hereof, and (iv) all references to a specific time shall be construed to refer to the time in the city and state of the Lender's principal office, unless otherwise indicated. All defined terms used in this Agreement that are not defined herein shall have the meanings set forth in the Subordinated Note.

Section 2.1.   Subordinated Term Loan and Subordinated Note .  (a) Subject to the terms and conditions set forth herein, the Lender agrees to make the Subordinated Term Loan to the Borrower on the Closing Date in a principal amount equal to Fifteen Million Dollars ($15,000,000).

(b)           The Borrower's obligation to pay the principal of, and interest on, the Subordinated Term Loan shall be evidenced by the records of the Lender and by the Subordinated Note.  The entries made in such records shall be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded;   provided , that the failure or delay of the Lender in maintaining or making entries into any

such record or any error therein shall not in any manner affect the obligation of the Borrower to repay the Subordinated Term Loan (both principal and unpaid accrued interest) in accordance with the terms of this Agreement and the Subordinated Note.

Section 2.2.   Subordinated Note . The terms of the Subordinated Note are hereby incorporated by reference into this Agreement as if fully set forth herein.

Section 2.3.    Inability to Determine Interest Rates .  If prior to the occurrence of any Interest Reset Date, the Lender shall have determined (which determination shall be conclusive and binding upon the Borrower ) that (a) by reason of circumstances affecting the relevant interbank market, ad­equate means do not exist for ascertaining LIBOR, or (b) LIBOR does not adequately and fairly reflect the cost to the Lender of maintaining the Subordinated Term Loan, the Lender shall give written notice (or telephonic notice, promptly confirmed in writing) to the Borrower as soon as practicable thereafter. Until the Lender notifies the Borrower that the circumstances giv­ing rise to such notice no longer exist, interest on the Subordinated Term Loan shall be calculated at the Base Rate, plus 1.30 % per annum.

 Section 2.4.   Illegality .   If any Change in Law shall make it unlawful or impossible for the Lender to maintain the Subordinated Term Loan, the Lender shall promptly give notice thereof to the Borrower, whereupon until the Lender notifies the Borrower that the circumstances giving rise to such suspension no longer exist, the obligation of the Lender to continue accruing interest based on LIBOR shall be suspended. In such case, the outstanding Subordinated Term Loan shall be converted to a loan accruing interest at the Base Rate, plus 1.30% per annum either (x) on the next Interest Reset Date if the Lender may lawfully continue to maintain the Subordinated Term Loan using LIBOR to such date or (y) immediately if the Lender shall determine that it may not lawfully continue to maintain the Subordinated Term Loan at LIBOR to such Interest Reset Date.

Section 2.5.   Increased Costs .

(ii)           impose on the Lender or the eurodollar interbank market any other condition affecting this Agreement or the Subordinated Term Loan; and the result of the foregoing is to increase the cost to the Lender of maintaining the Subordinated Term Loan or to reduce the amount received or receivable by the Lender hereunder (whether of principal, interest or any other amount), then the Borrower shall promptly pay, upon written notice from and demand by the Lender, within five Business Days after the date of such notice and demand, additional amount or amounts sufficient to compensate the Lender for such additional costs incurred or reduction suffered.

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

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

(d)           Failure or delay on the part of the Lender to demand compensation pursuant to this Section shall not constitute a waiver of the Lender's right to demand such compensation.

Section 2.6.    Funding Indemnity .  In the event of the payment of any principal of the Subordinated  Loan other than on an Interest Reset Date or the Maturity Date, the Borrower shall compensate the Lender, within five (5) Business Days after written demand from the Lender,  for any loss, cost or expense attributable to such event. Such loss, cost or expense shall be deemed to include an amount determined by the Lender to be the excess, if any, of  (A) the amount of interest that would have accrued on the principal amount of the Subordinated Term Loan if such event had not occurred at LIBOR applicable to the Subordinated Term Loan for the period from the date of such event to the next Interest Reset Date  over (B) the amount of interest that would accrue on the principal amount of the Subordinated Loan for the same period if LIBOR were set on the date the Subordinated Term Loan was prepaid.  A certifi­cate as to any additional amount payable under this Section 2.6 submitted to the Borrower by the Lender shall be con­clusive, absent manifest error.

Section 3.1.    Conditions To Making the Subordinated Term Loan .  The obligation of the Lender to make the Subordinated Term Loan hereunder is subject to the receipt by the Lender of the following documents in form and substance reasonably satisfactory to the Lender:

(c)           a certificate of the Secretary or Assistant Secre­tary of the Borrower, attaching and certifying copies of its articles of incorporation, bylaws and of the resolutions of its board of directors, authorizing the execution, delivery and performance of the Loan Documents and certifying the name, title and true signature of each officer of the Borrower authorized to execute the Loan Documents;

(d)           a certificate of corporate existence issued by the Office of the Comptroller of the Currency dated not later than 5 Business Days prior to the Closing Date;

(e)           a favorable written opinion of  Schell Bray Aycock Abel & Livingston PLLC, counsel to the Borrower, addressed to the Lender, and covering such matters relating to the Borrower, the Loan Documents and the transactions contemplated therein as the Lender shall reasonably request;

(f)              a certificate of Borrower, signed by the Chief Executive Officer, President or an Executive Vice President and by the Chief Financial Officer, Treasurer or Assistant Treasurer of the Borrower,  certifying that : (a)   all representations and warranties of the Borrower  herein shall be true and correct in all material respects on and as of the Closing Date, both before and after giving effect to the Subordinated Term Loan,  and (b) since December 31, 2007, there has been no material adverse change in the condition (financial or other), earnings, business, prospects or assets of the Borrower or of the Company and its Subsidiaries; and

The Borrower represents and warrants to the Lender as follows:

Section 4.1.   Existence; Power . The Borrower is a national bank chartered under the laws of the United States and has all requisite power and authority to carry on its business as now conducted.

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

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

Section 4.4.    Financial Statements .  (a) The Borrower has furnished to the Lender (i) the con­solidated balance sheet of the Company and its Subsidiaries as of December 31, 2007 and the related consolidated statements of income, of shareholders' equity and comprehensive income and of cash flows for the fiscal year then ended, each as audited by Dixon Hughes PLLC and (ii) the unaudited consolidated balance sheet of the Company and its Subsidiaries as at the end of the March 31, 2008, and the related unaudited consolidated statements of in­come and of cash flows for the fiscal quarter then ending, certified by the Chief Financial Officer of the Company.  Such financial statements fairly present the consolidated financial condition of the Company and its Subsidiaries as of such dates and the consolidated results of op­erations  and cash flows for such periods in conformity with GAAP consistently applied, subject to year end audit adjustments and the absence of footnotes in the case of the statements referred to in clause (ii). Since December 31, 2007, there have been no changes with respect to the Company and its Subsidiaries which have had or could   reasonably be expected to have, singly or in the aggregate, a Material Adverse Effect.

(b)           The Company’s FR Report Y-9C and FR Report Y-9LP, each dated March 31, 2008, provided to the Lender is the most recently available of such  reports, and the information therein fairly presents in all material respects the financial position of the Company and its Subsidiaries as of such date.

(c)           The Borrower’s then-current and a duly executed copy of the then-current Call Report provided to the Lender is the most recently available of such report, and the information therein fairly presents in all material respects the financial position of the Borrower.

Section 4.5.   Litigation Matters .  No litigation, investigation or proceeding of or before any arbitra­tors or Governmental Authorities is pending against, or, to the knowledge of the Borrower, threatened against or affecting the Company or any of its Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination that could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect or (ii) which in any manner draws into question the validity or enforceability of this Agreement or any other Loan Document.

Section 4.6. Compliance with Laws and Agreements .  The Company  and each Subsidiary is in compliance with (a) all applicable laws (including without limitation all federal and state banking statutes) and all rules, regulations (including without limitation all federal and state banking regulations) and orders of any Governmental Authority, and (b) all indentures, agreements or other instruments binding upon it or its properties, except in each case where non-compliance, either singly or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

Section 4.7. Regulatory Enforcement Matters.   Neither the Company nor any of its Subsidiaries (including the Borrower), nor any of their respective officers, directors, employees or representatives, is subject or is party to, or has received any notice from any Governmental Authority that any of them will become subject or party to any investigation with respect to, any cease-and-desist order, agreement, civil monetary penalty, bar or suspension from the securities investment or banking businesses, consent agreement, memorandum of understanding or other regulatory enforcement action, proceeding or order with or by, or is a party to any commitment letter or similar undertaking to, or is subject to any directive by, or has been a recipient of any supervisory letter from, or has adopted any board resolutions at the request or suggestion of, any Governmental Authority that, in any such case, currently restricts in any material respect the conduct of their business or that in any material manner relates to their capital adequacy, their credit policies, their management or their business (each, a “ Regulatory Action ”), nor has the Company or any of its Subsidiaries (including the Borrower) been advised by any Governmental Authority that it is considering issuing or requesting any such Regulatory Action; and there is no unresolved violation, criticism or exception by any Governmental Authority with respect to any report or statement relating to any examinations of the Company or any of its Subsidiaries (including the Borrower), except where such unresolved violation, criticism or exception would not, singly or in the aggregate, have a Material Adverse Effect.

Section 4.8.   Investment Company Act.   The Borrower is not an "investment company", as defined in, or subject to regulation under, the Investment Company Act of 1940, as amended.

Section 4.9.   Taxes .  The Borrower and its Subsidiaries have timely filed or caused to be filed all Federal income tax returns and all other material tax returns that are re­quired to be filed by them, and have paid all taxes shown to be due and payable on such returns or on any assessments made against it or its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Authority, except (i) to the extent the failure to do so would not have a Material Adverse Effect or (ii)   where the same are currently being contested in good faith by ap­propriate proceedings and for which the Borrower or such Subsidiary, as the case may be, has set aside on its books adequate reserves.

Section 4.10.     Disclosure . The Borrower has disclosed to the Lender all agreements, instruments, and corporate or other restrictions to which the Borrower or any of its Subsidiaries is subject, and all other matters known to any of them, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.  None of the reports (including without limitation all reports that the

Borrower is required to file with the Commission), financial statements, certificates or other information furnished by or on behalf of the Borrower to the Lender in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by any other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, taken as a whole, in light of the circumstances under which they were made, not misleading.

Section 4.11. Dividend Restrictions; Other Restrictions .   (a)   The Borrower has not violated any applicable regulatory restrictions on dividends, and no Governmental Authority has taken any action to restrict the payment of dividends by the Borrower.

(b) Neither the Company nor any Subsidiary is under investigation by, or is operating under any restrictions (excluding any restrictions on the payment of dividends referenced in subsection (a) above) imposed by or agreed to with, any Governmental Authority, other than routine examinations by such Governm