Amendment No. 5 to Form S-4

(Address, including Zip Code, and Telephone Number, including Area Code, of Registrant’s Principal Executive Offices)

(Name, Address, including Zip Code, and Telephone Number, including Area Code, of Agent for Service)

Approximate date of commencement of the proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective and upon completion of the merger described in the enclosed document.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, as amended, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one):

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such dates as the Securities and Exchange Commission, acting pursuant to said section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

This prospectus relates to shares of our Class A common stock of Capital Bank Financial Corp. (formerly known as North American Financial Holdings, Inc.) (which we refer to as “we,” “us,” “our” or “CBF”) that we will issue in connection with our merger with TIB Financial Corp. (which we refer to as “TIB Financial”). On September 1, 2011, our Board of Directors adopted a plan of merger (which we refer to as the “plan of merger”) providing for the merger of TIB Financial with and into us, with us as the surviving corporation (which we refer to as the “merger”). Our Board of Directors adopted the plan of merger as part of a corporate reorganization (which we refer to as the “reorganization”) of CBF in which, substantially concurrent with the completion of the merger, we expect to complete mergers with our other bank holding company subsidiaries.

If we complete the merger, TIB Financial will be merged with and into CBF, and, unless you seek to exercise your appraisal rights, your shares of TIB Financial common stock will be converted into shares of Class A common stock of CBF. For each of your shares of TIB Financial common stock you hold at the time of the merger, you will receive 0.7205 shares of our Class A common stock (which we refer to as the “exchange ratio”), plus cash in lieu of fractional shares. Based on the number of shares of TIB Financial common stock outstanding as of September 7, 2012, the latest practicable date before the date of this document, and assuming no TIB Financial shareholders exercise appraisal rights, we expect to issue approximately 492,325 shares of our Class A common stock in the merger.

There is currently no public market for our Class A common stock. Substantially concurrent with the completion of the merger, we expect to complete an initial public offering of our Class A common stock (which we refer to as the “initial public offering”). The stock consideration issued in the merger would, assuming that CBF Class A common stock trades at values between $21 and $23 per share following the merger (which is the estimated public offering price per share in the initial public offering), have a value between $15.13 and $16.57 per share of TIB Financial common stock. In connection with our initial public offering, we have applied to list our Class A common stock on The Nasdaq Global Select Market (which we refer to as “Nasdaq”) under the symbol “CBF.” Whether or not we complete an initial public offering prior to or concurrent with the completion of the merger, any shares of our common stock received as merger consideration by TIB Financial shareholders will be listed on Nasdaq. On September 7, 2012, the last practicable date before the date of this document, the last reported sale price of TIB Financial common stock was $11.70.

We currently own approximately 94% of the common stock of TIB Financial. The plan of merger satisfies the requirements for a short-form merger under Delaware and Florida law, and consequently, no vote of our stockholders or the shareholders or Board of Directors of TIB Financial is required in order for the merger to take place.

This prospectus serves to provide you with information about our shares of Class A common stock to be issued in the merger. Neither we nor TIB Financial is asking you for a proxy and you are requested not to send a proxy.

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012.

Please see “Risk Factors” beginning on page 20 for a discussion of risks relating to the merger.

The shares of our Class A common stock to be issued in the merger will not be savings accounts, deposits or other obligations of any of our bank or non-bank subsidiaries and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency.

Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

Information about TIB Financial is available for you to read and copy at the Securities and Exchange Commission’s (which we refer to as the “SEC”) Public Reference Room located at 100 F Street, N.E., Room 1580, Washington, DC 20549, and through the SEC’s website, www.sec.gov. You can also obtain these documents by requesting them in writing or by telephone from the appropriate company at the following addresses:

You should rely only on the information contained in this document. We have not authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. This document does not constitute an offer to sell, or a solicitation of an offer to buy, any securities in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. The information contained in this document is accurate only as of the date of this document, regardless of the time of delivery of this document or any sale of our Class A common stock. Our or TIB Financial’s business, financial condition, results of operations and prospects may have changed since that date.

No action is being taken in any jurisdiction outside the United States to permit a public offering of our Class A common stock or possession or distribution of this document in that jurisdiction. Persons who come into possession of this document in jurisdictions outside the United States are required to inform themselves about, and to observe, any restrictions as to the offering and the distribution of this document applicable to those jurisdictions.

Market data used in this document has been obtained from independent industry sources and publications, such as SNL Financial and Case-Shiller. We have not independently verified the data obtained from these sources. Forward-looking information obtained from these sources is subject to the same qualifications and the additional uncertainties regarding the other forward-looking statements in this document.

In this document, unless the context suggests otherwise, references to “CBF,” “we,” “our,” “us” and the “Company” for all periods prior and subsequent to the acquisitions described in this document refer to Capital Bank Financial Corp. (formerly known as North American Financial Holdings, Inc.) a Delaware corporation, and its consolidated subsidiaries, which includes Capital Bank, National Association or (formerly known as NAFH National Bank), a national banking association (which we refer to as “Capital Bank” or “Capital Bank, N.A.”), TIB Financial Corp. (which we refer to as “TIB Financial”), Capital Bank Corporation (which we refer to as “Capital Bank Corp.”) and Green Bankshares, Inc. (which we refer to as “Green Bankshares”). In addition, references to “Southern Community Financial” refer to Southern Community Financial Corporation. References to the “Failed Banks” refer to First National Bank of the South in Spartanburg, South Carolina (which we refer to as “First National Bank”), Metro Bank of Dade County in Miami, Florida (which we refer to as “Metro Bank”) and Turnberry Bank in Aventura, Florida (which we refer to as “Turnberry Bank”). References to “Old Capital Bank” refer to Capital Bank Corp.’s banking subsidiary prior to June 30, 2011, the date on which NAFH National Bank merged with Old Capital Bank and changed its name to Capital Bank, National Association. References to our “common stock” refer together to our Class A common stock, par value $0.01 per share, and Class B non-voting common stock, par value $0.01 per share. References to “TIB Financial common stock” refer to the common stock, par value $0.10 per share, of TIB Financial.

The following are some questions that you, as a shareholder of TIB Financial, may have regarding the merger. We urge you to read carefully the remainder of this document because the information in this section does not provide all the information that might be important to you with respect to the merger. Additional important information is also contained in the appendices to this document.

As a result of the merger, shareholders of TIB Financial who do not properly exercise their appraisal rights will have their shares of TIB Financial common stock converted into our shares of Class A common stock. Additional terms of the plan of merger are described in this document, and a copy of the plan of merger is attached to this document as Appendix A. You should read this document carefully because it contains important information about the merger.

For a more complete description of how fractional shares will be treated in the merger, see “The Plan of Merger—Structure of the Merger.”

Sterne, Agee & Leach, Inc., an investment banking firm (which we refer to as “Sterne Agee”), has concluded that, subject to the assumptions, limitations and qualifications contained in the fairness opinion, as of the date of the fairness opinion, the consideration to be received in the merger is fair to you, from a financial point of view. See “The Merger—Fairness Opinion from Sterne Agee.”

For information on the background of the merger, see “The Merger—Background and Reasons for the Merger.”

SUMMARY

This summary highlights material information from this document. We urge you to carefully read the entire document and the other documents to which we refer in order to fully understand the merger and your rights as a TIB Financial shareholder. See “Additional Information” on page (i). Each item in this summary refers to the page of this document on which that subject is discussed in more detail.

Information About CBF and TIB Financial (see pages 67 and 173, respectively)

CBF

Since our founding, we have acquired six depository institutions, including the assets and certain deposits of three failed banks from the FDIC, and operate branches located in North Carolina, South Carolina, Florida, Tennessee and Virginia. We expect to complete the acquisition of a seventh institution through our acquisition of Southern Community Financial in the second half of 2012. Through our branches, we offer a wide range of commercial and consumer loans and deposits, as well as ancillary financial services. Our banking business is primarily conducted through our indirect-majority held subsidiary, Capital Bank, N.A.

Substantially concurrent with the completion of the merger, we expect to complete mergers with our other bank holding company subsidiaries, which will result in our having a single directly and wholly owned bank subsidiary, Capital Bank, N.A.

Our principal executive offices are located at 121 Alhambra Plaza, Suite 1601, Coral Gables, Florida 33134 and our telephone number is (305) 670-0200.

TIB Financial

TIB Financial is a bank holding company headquartered in Naples, Florida. CBF is the owner of approximately 94% of the common stock of TIB Financial. In addition, five of the seven directors of TIB Financial, and TIB Financial’s Chief Executive Officer, Chief Financial Officer and Chief Risk Officer are affiliated with CBF. Because TIB Financial’s assets consist primarily of approximately 21% of the capital stock of Capital Bank, N.A., which is also the principal business operated by CBF, the principal business of TIB Financial is described above under the heading “CBF” and under the heading “Information About CBF.” In addition, TIB Financial conducts its trust and investment management business through Naples Capital Advisors.

TIB Financial’s principal executive offices are located at 599 9th Street North, Suite 101, Naples, Florida 34102-5624 and its phone number is (239) 263-3344.

The Merger (see page 48)

The plan of merger provides for the merger of TIB Financial with and into CBF, with CBF continuing as the surviving entity. In the merger, each share of TIB Financial common stock issued and outstanding immediately prior to the completion of the merger, except for shares for which appraisal rights are properly exercised and

certain shares held by CBF or TIB Financial, will be converted into the right to receive 0.7205 of a share of CBF Class A common stock. No fractional shares of Class A common stock will be issued in connection with the merger, and holders of TIB Financial common stock will be entitled to receive cash in lieu thereof.

On September 30, 2010, CBF invested $175.0 million in TIB Financial at a per share purchase price of $0.15 and received 98.7% of the then outstanding voting power of TIB Financial. The stock consideration issued in the merger would, assuming that CBF Class A common stock trades at values between $21 and $23 per share following the merger (which is the estimated public offering price per share in the initial public offering), have a value between $15.13 and $16.57 per share of TIB Financial common stock.

Opinion of Sterne Agee (see Appendix B)

TIB Financial retained Sterne Agee to render an opinion to TIB Financial in connection with the merger. On August 31, 2011, Sterne Agee delivered its written opinion to TIB Financial’s board of directors that, as of such date, and based upon and subject to factors and assumptions set forth therein, the consideration to be received in the merger was fair, from a financial point of view, to the shareholders of TIB Financial. The full text of Sterne Agee’s written opinion, dated August 31, 2011, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken, in connection with the opinion, is attached as Appendix B to this document and is incorporated herein by reference. You are encouraged to read the opinion and the description beginning on pages B-1 and 52, respectively, carefully and in their entirety.

Appraisal Rights (see page 56)

As a shareholder of TIB Financial, you have the right under the FBCA to exercise appraisal rights and, if the merger is consummated, obtain the payment of the “fair value” of your shares of TIB Financial common stock (as valued immediately prior to the completion of the merger in accordance with Florida law). The fair value of shares of TIB Financial common stock, as determined in accordance with Florida law, may be more or less than, or equal to, the merger consideration to be paid to shareholders in the merger pursuant to the plan of merger. To preserve your appraisal rights, if you wish to exercise appraisal rights you must follow precisely the specific procedures provided under Florida law for perfecting appraisal rights or your appraisal rights may be lost. These procedures are described in this document, and a copy of Sections 607.1301 through 607.1333 of the FBCA, which grants appraisal rights and governs such procedures, is attached as Appendix C to this document. See “The Merger—Appraisal Rights.”

Regulatory Approvals Required for the Merger (see page 60)

We are not aware of any material regulatory requirements applicable to the merger under any U.S. state or federal law or regulation, other than any requirements under applicable federal and state securities laws and regulations and Florida and Delaware corporate law.

Accounting Treatment of the Merger (see page 61)

The merger will be accounted for as a “purchase” of a noncontrolling interest, as such term is used under generally accepted accounting principles (which we refer to as “GAAP”), for accounting and financial reporting purposes.

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF CBF

The following table sets forth our selected historical consolidated financial information. You should read this information in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the related notes thereto included elsewhere in this document. The summary historical consolidated financial information set forth below as of June 30, 2012 and for the six months ended June 30, 2012 and 2011 has been derived from our unaudited consolidated financial statements included elsewhere in this prospectus. The summary historical consolidated financial information set forth below as of June 30, 2012 has been derived from our unaudited consolidated financial statements which are not included in this prospectus. The selected historical consolidated financial information set forth below as of and for the years ended December 31, 2011 and December 31, 2010 and for the period from November 30, 2009 (date of inception) through December 31, 2009 is derived from our audited consolidated financial statements included elsewhere in this document.

On July 16, 2010, we purchased certain assets and assumed certain liabilities, including substantially all deposits, of First National Bank, Metro Bank and Turnberry Bank from the FDIC, as receiver. On September 30, 2010, January 28, 2011 and September 7, 2011, we consummated controlling investments in TIB Financial, Capital Bank Corp. and Green Bankshares, respectively. On March 26, 2012, we agreed to acquire all of the common equity interest in Southern Community Financial. Our acquisition of Southern Community Financial is subject to Southern Community Financial stockholder approval, regulatory approvals and other customary closing conditions, and is expected to be completed in the second half of 2012. Although we were formed in November 2009, our activities prior to our first acquisition consisted solely of organizational, capital raising and related activities and activities related to identifying and analyzing potential acquisition candidates. We did not engage in any substantive operations (including banking operations) prior to our first acquisition. We have omitted certain historical financial information of First National Bank, Metro Bank and Turnberry Bank required by Rule 3-05 of Regulation S-X and the related pro forma financial information under Article 11 of Regulation S-X pursuant to the guidance provided in Staff Accounting Bulletin Topic 1:K, Financial Statements of Acquired Troubled Financial Institutions (“SAB 1:K”) and a request for relief granted by the SEC. SAB 1:K provides relief from the requirements of Rule 3-05 of Regulation S-X in certain instances where a registrant engages in an acquisition of a troubled financial institution in which federal assistance is an essential and significant part of the transaction and for which audited financial statements are not reasonably available.

The selected historical consolidated financial information presented in the following tables as of and for the year ended December 31, 2011 includes our results, including First National Bank, Metro Bank, Turnberry Bank and TIB Financial as well as the results of Capital Bank Corp. subsequent to January 28, 2011 and Green Bankshares subsequent to September 7, 2011.

The selected historical consolidated financial information in the following tables as of and for the six months ended June 30, 2012 includes our results, including First National Bank, Metro Bank, Turnberry Bank, TIB Financial, Capital Bank Corp and Green Bankshares. The selected historical consolidated financial information presented in the following tables as of and for the six months ended June 30, 2011 includes our results, including First National Bank, Metro Bank, Turnberry Bank and TIB Financial as well as the results of Capital Bank Corp. subsequent to January 28, 2011.

Because substantially all of our business is composed of acquired operations and because the operations of each acquired business were substantially changed in connection with its acquisition, our results of operations reflect different operations in different periods (or portions of periods) and therefore cannot be meaningfully compared. In addition, results of operations for these periods reflect, among other things, the acquisition method of accounting. Under the acquisition method of accounting, all of the assets acquired and liabilities assumed were initially recorded on our consolidated balance sheet at their estimated fair values as of the dates of acquisition.

These estimated fair values differed substantially from the carrying amounts of the assets acquired and liabilities assumed as reflected in the financial statements of the Failed Banks, TIB Financial, Capital Bank Corp. and Green Bankshares immediately prior to the respective acquisitions.


(Dollars in thousands, except per share data)	As of and for the Six Months Ended June 30, 2012			As of and for the Six Months Ended June 30, 2011			As of and for Year Ended December 31, 2011			As of and for Year Ended December 31, 2010			As of December 31, 2009 and for the Period From November 30 Through December 31, 2009

Summary Results of Operations
Interest and dividend income	$	147,034		$	89,848		$	227,912		$	42,745		$	72
Interest expense		19,837			16,325			36,592			6,234			–

Net interest income		127,197			73,523			191,320			36,511			72
Provision for loan losses		11,984			9,760			38,396			753			–

Net interest income after provision for loan losses		115,213			63,763			152,924			35,758			72

Non-interest income		26,681			12,400			41,227			19,615			–
Non-interest expense		121,546			72,525			182,195			44,377			214

Income (loss) before income taxes		20,348			3,638			11,956			10,996			(142	)
Income tax expense (benefit)		7,812			1,258			4,434			(1,041	)		(50	)

Net income (loss) before attribution of noncontrolling interests		12,536			2,380			7,522			12,037			(92	)
Net income (loss) attributable to noncontrolling interests		1,772			394			1,310			7			–

Net income (loss) attributable to Capital Bank Financial Corp.	$	10,764		$	1,986		$	6,212		$	12,030		$	(92	)

Summary Balance Sheet Data
Cash and cash equivalents	$	229,020		$	526,131		$	709,963		$	886,925		$	526,711
Investment securities		1,162,729			862,085			826,911			479,716			–
Loans held for sale		12,451			4,713			20,746			9,690			–
Loans receivable:
Not covered under FDIC loss sharing agreements		3,716,744			2,348,159			3,731,125			1,046,463			–
Covered under FDIC loss sharing agreements.		461,820			621,931			550,592			696,284			–
Allowance for loan losses		(45,472	)		(7,486	)		(34,749	)		(753	)		–

Net loans		4,133,092			2,962,604			4,246,968			1,741,994			–

Other real estate owned		158,235			77,887			168,781			70,817			–
FDIC indemnification asset		60,750			72,747			66,282			91,467			–
Receivable from FDIC		9,699			22,652			13,315			46,585			–
Goodwill and intangible assets, net		140,367			105,504			142,652			51,878			–
Other assets		397,541			238,151			390,762			117,919			50

Total assets	$	6,303,884		$	4,872,474		$	6,586,380		$	3,496,991		$	526,761

Liabilities and Shareholders’ Equity
Deposits		4,980,228			3,501,423			5,125,184			2,260,097			–
Advances from FHLB		67,520			244,939			221,018			243,067			–
Borrowings		190,254			133,985			194,634			84,856			–
Other liabilities		48,199			39,393			54,634			27,735			441

Total liabilities		5,286,201			3,919,740			5,595,470			2,615,755			441

Shareholders’ equity		1,017,683			952,734			990,910			881,236			526,320

Total liabilities and shareholders’ equity	$	6,303,884		$	4,872,474		$	6,586,380		$	3,496,991		$	526,761


(Dollars in thousands, except per share data)	As of and for Six Months Ended June 30, 2012			As of and for Six Months Ended June 30, 2011			As of and for Year Ended December 31, 2011			As of and for Year Ended December 31, 2010			As of December 31, 2009 and for the Period From November 30 Through December 31, 2009
Per Share Data
Earnings
Basic	$	0.24		$	0.04		$	0.14		$	0.31		$	(0.01	)
Diluted	$	0.24		$	0.04		$	0.14		$	0.31		$	(0.01	)
Tangible book value⁽¹⁾	$	17.69		$	17.70		$	17.25		$	18.39		$	18.86
Weighted average shares outstanding
Basic		45,182,675			45,120,175			45,121,716			38,205,677			8,243,830
Diluted		45,553,675			45,270,175			45,383,716			38,205,677			8,243,830
Common shares outstanding		46,456,561			46,149,998			46,149,998			45,120,175			27,906,524
Performance Ratios
Return on average assets		0.39	%		0.10	%		0.14	%		0.76	%		(0.64	)%
Return on average equity		2.51	%		0.51	%		0.79	%		1.67	%		(0.64	)%
Net interest margin		4.54	%		3.63	%		4.05	%		2.51	%		0.50	%
Interest rate spread		4.39	%		3.42	%		3.86	%		2.14	%		0.50	%
Efficiency ratio⁽²⁾		78.99	%		84.41	%		78.35	%		79.07	%		NM
Average interest-earning assets to average interest-bearing liabilities		121.17	%		126.52	%		124.46	%		186.59	%		NA
Average loans receivable to average deposits		83.05	%		83.25	%		83.87	%		79.59	%		NA
Cost of interest-bearing liabilities		0.85	%		1.01	%		0.96	%		0.80	%		NA
Asset Quality
Non-performing loans to loans receivable⁽³⁾
Not covered under loss sharing agreements with the FDIC		6.12	%		6.16	%		6.00	%		3.25	%		NA
Covered under loss sharing agreements with the FDIC		2.24	%		4.43	%		2.89	%		7.88	%		NA
Total non-performing loans to loans receivable		8.36	%		10.59	%		8.89	%		11.12	%		NA
Non-performing assets to total assets
Not covered under loss sharing agreements with the FDIC		5.89	%		4.44	%		5.82	%		2.28	%		NA
Covered under loss sharing agreements with the FDIC		2.22	%		3.70	%		2.59	%		5.37	%		NA
Total non-performing assets to total assets		8.11	%		8.14	%		8.41	%		7.65	%		NA
Allowance for loan losses to non-performing loans
Not covered under loss sharing agreements with the FDIC		12.04	%		2.65	%		8.88	%		1.33	%		NA
Covered under loss sharing agreements with the FDIC		15.58	%		2.14	%		9.51	%		NA			NA
Total allowance for loan losses to non-performing loans		12.98	%		2.44	%		9.08	%		0.39	%		NA
Capital Ratios
Average equity to average total assets		15.56	%		20.18	%		17.97	%		45.51	%		99.79	%
Tangible common equity⁽⁴⁾		14.23	%		17.77	%		13.16	%		24.08	%		99.92	%
Tier 1 leverage		13.74	%		17.66	%		12.55	%		24.30	%		NM
Tier 1 risk-based capital		19.87	%		30.17	%		19.31	%		41.80	%		NM
Total risk-based capital		21.04	%		30.62	%		20.24	%		41.90	%		NM

⁽¹⁾

We calculate tangible book value, which is a non-GAAP measure but which we believe is helpful to investors in understanding our business. Tangible book value is equal to book value less goodwill and core deposit intangibles, net of related deferred tax liabilities. The following table sets forth a reconciliation of tangible book value to book value, which is the most directly comparable GAAP measure:


(Dollars in thousands, except per share data)	As of June 30, 2012			As of June 30, 2011			As of December 31, 2011			As of December 31, 2010			As of December 31, 2009
Total shareholders’ equity	$	1,017,683		$	952,734		$	990,910		$	881,236		$	526,320
Less: Noncontrolling interest		(76,610	)		(48,846	)		(74,505	)		(5,933	)		–
Less: CBF Corp. proportional share of goodwill(*)		(105,526	)		(76,594	)		(105,526	)		(36,226	)		–
Less: CBF Corp. proportional share of core deposit intangibles, net of taxes(*)		(13,571	)		(10,294	)		(14,841	)		(9,217	)		–

Tangible Book Value	$	821,976		$	817,000		$	796,038		$	829,860		$	526,320
Book Value Per Share	$	20.26		$	19.59		$	19.86		$	19.40		$	18.86
Tangible Book Value Per Share	$	17.69		$	17.70		$	17.25		$	18.39		$	18.86

(*)

Proportional share is calculated based upon our ownership percentage of TIB Financial, Capital Bank Corp. and Green Bankshares at each respective period.

⁽²⁾	We calculate our efficiency ratio by dividing non-interest expense by the sum of net interest income and non-interest income.

⁽³⁾	Non-performing loans include non-accrual loans and loans past due over 90 days that retain accrual status due to accretion of income on purchased credit-impaired loans (which we refer to as “PCI loans”).

⁽⁴⁾

The tangible common equity ratio is a non-GAAP measure which we believe provides investors with information useful in understanding our financial performance and, specifically, our capital position. The tangible common equity ratio is calculated as tangible common equity (calculated in accordance with the Order of the FDIC, dated July 16, 2010 and amended on December 21, 2011 (which we refer to as the “FDIC Order”) divided by tangible assets. Tangible common equity is calculated as total shareholders’ equity less preferred stock and less goodwill and other intangible assets, net and tangible assets are total assets less goodwill and other intangible assets, net. The following table provides reconciliations of tangible common equity to GAAP total common shareholders’ equity and tangible assets to GAAP total assets:


(Dollars in thousands)	As of June 30, 2012			As of June 30, 2011			As of December 31, 2011			As of December 31, 2010			As of December 31, 2009
Shareholders’ equity	$	1,017,683		$	952,734		$	990,910		$	881,236		$	526,320
Less: Preferred stock		–			–			–			–			–
Less: Goodwill and other intangible assets, net		(140,367	)		(105,504	)		(142,652	)		(51,878	)		–

Tangible common shareholders’ equity	$	877,316		$	847,230		$	848,258		$	829,358		$	526,320

Total assets	$	6,303,884		$	4,872,474		$	6,586,380		$	3,496,991		$	526,761
Less: Goodwill and other intangible assets, net		(140,367	)		(105,504	)		(142,652	)		(51,878	)		–

Tangible assets		6,163,517			4,766,970		$	6,443,728		$	3,445,113		$	526,761

Tangible common equity ratio		14.23	%		17.77	%		13.16	%		24.07	%		99.92	%

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF TIB FINANCIAL

The following table sets forth selected historical consolidated financial information for TIB Financial. You should read this information in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for TIB Financial and the consolidated financial statements for TIB Financial and the related notes thereto included elsewhere in this document. The selected historical consolidated financial information set forth below as of and for each of the years in the five year period ended December 31, 2011 is derived from the audited consolidated financial statements of TIB Financial of which 2009, 2008 and 2007 are not included in this prospectus. The selected historical consolidated financial information set forth below as of and for the six months ended June 30, 2012 and 2011 is derived from the unaudited consolidated financial statements of TIB Financial of which June 30, 2011 is not included in the prospectus.

Balance Sheet Data and Ratios


(Dollars and shares in thousands, except per share data)	Successor Company									Predecessor Company
(Dollars and shares in thousands, except per share data)	June 30, 2012		December 31, 2011		June 30, 2011		December 31, 2010			December 31, 2009			December 31, 2008			December 31, 2007
Total assets	$	209,646	$	204,592		210,103	$	1,756,866		$	1,705,407		$	1,610,114		$	1,444,739
Investment securities		–		–		–		418,092			250,339			225,770			160,357
Total loans		–		–		–		1,004,329			1,196,164			1,223,319			1,127,667
Allowance for loan losses		–		–		–		402			29,083			23,783			14,973
Deposits		–		–		–		1,367,025			1,369,384			1,135,668			1,049,958
Shareholders’ equity		182,021		177,347		180,036		176,750			55,518			121,114			96,240
Allowance for loan losses/total loans		NA		NA		NA		NM			2.43	%		1.94	%		1.33	%
Allowance for loan losses/loans originated in Successor period		NA		NA		NA		1.76	%		NA			NA			NA
Non-performing assets/total assets		NA		NA		NA		4.84	%		5.71	%		2.95	%		1.88	%
Non-performing loans/total loans		NA		NA		NA		5.61	%		6.09	%		3.25	%		1.43	%
Allowance for loan losses/non-performing loans		NA		NA		NA		NA			39.93	%		59.79	%		93.08	%

Income Statement and Performance Data


(Dollars and shares in thousands, except per share data)	Successor Company												Predecessor Company
(Dollars and shares in thousands, except per share data)	Six Months Ended June 30, 2012			Year Ended December 31, 2011			Six Months Ended June 30, 2011			Three Months Ended December 31, 2010			Nine Months Ended September 30, 2010			Year Ended December 31, 2009			Year Ended December 31, 2008			Year Ended December 31, 2007
Interest and dividend income	$	3		$	21,146		$	21,134		$	15,681		$	52,317		$	81,127		$	88,164		$	94,741
Interest expense		902			5,481			4,518			3,249			19,435			35,736			43,504			48,721

Net interest income		(899	)		15,665			16,616			12,432			32,882			45,391			44,660			46,020
Provision for loan losses		–			621			621			402			29,697			42,256			28,239			9,657

Net interest income after provision for loan losses		(899	)		15,044			15,995			12,030			3,185			3,135			16,421			36,363
Non-interest income*		5,181			8,626			4,673			2,710			9,326			14,110			784			1,362
Non-interest expense**		994			21,770			17,924			13,923			65,316			65,342			50,988			41,921
Income tax expense (benefit)***		(618	)		(900	)		716			257			–			13,451			(12,853	)		(1,775	)

Income (loss) before preferred allocation		3,906			2,800			2,028			560			(52,805	)		(61,548	)		(20,930	)		(2,421	)
Income earned by preferred shareholders and discount accretion		–			–			–			–			2,009			2,662			165			–
Gain on retirement of Series A preferred allocated to common shareholders		–			–			–			–			(24,276	)		–			–			–

Net income (loss) allocated to common shareholders	$	3,906		$	2,800		$	2,028		$	560		$	(30,538	)	$	(64,210	)	$	(21,095	)	$	(2,421	)

Book value per common share****	$	14.74		$	14.36		$	14.58		$	14.96		$	15.18		$	141.63		$	592.09		$	709.26
Basic earnings (loss) per common share from continuing operations	$	0.32		$	0.23		$	0.17		$	0.05		$	(205.64	)	$	(433.27	)	$	(145.02	)	$	(18.54	)
Basic earnings (loss) per common share	$	0.32		$	0.23		$	0.17		$	0.05		$	(205.64	)	$	(433.27	)	$	(145.02	)	$	(18.54	)
Diluted earnings (loss) per common share from continuing operations	$	0.32		$	0.23		$	0.14		$	0.03		$	(205.64	)	$	(433.27	)	$	(145.02	)	$	(18.54	)
Diluted earnings (loss) per common share	$	0.32		$	0.23		$	0.14		$	0.03		$	(205.64	)	$	(433.27	)	$	(145.02	)	$	(18.54	)
Basic weighted average common equivalent shares outstanding		12,350			12,350			12,055			11,817			149			148			145			131
Diluted weighted average common equivalent shares outstanding		12,350			12,324			14,048			18,320			149			148			145			131
Dividends declared per common share	$	–		$	–		$	–		$	–		$	–		$	–		$	0.0005		$	0.0023
Return on average assets*****		3.76%			0.40	%		0.34	%		0.13	%		(3.16	)%		(3.47	)%		(1.36	)%		(0.18	)%
Return on average equity*****		4.33%			1.55	%		2.23	%		1.25	%		(108.42	)%		(53.92	)%		(20.41	)%		(2.52	)%
Average equity/average assets		86.87%			25.78	%		15.07	%		10.19	%		2.91	%		6.44	%		6.65	%		6.99	%
Net interest margin		(210.31	%)		3.08	%		3.28	%		3.16	%		2.84	%		2.76	%		3.10	%		3.60	%
Dividend payout ratio******		NM			NM			NM			NM			NM			NM			NM			NM
Non-interest expense/tax equivalent net interest income and non-interest income from continuing operations		23.21%			89.62	%		84.04	%		91.76	%		154.27	%		109.47	%		111.78	%		87.86	%

SUMMARY UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL DATA

The following tables set forth our summary unaudited pro forma condensed combined financial data. You should read this information in conjunction with “Selected Historical Consolidated Financial Data of CBF,” “Unaudited Pro Forma Condensed Combined Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the related notes thereto included elsewhere in this document.

On July 16, 2010, we purchased certain assets and assumed certain liabilities, including substantially all of the deposits of First National Bank, Metro Bank and Turnberry Bank from the FDIC, as receiver. On September 30, 2010, January 28, 2011 and September 7, 2011, we consummated controlling investments in TIB Financial, Capital Bank Corp. and Green Bankshares, respectively. On March 26, 2012, we agreed to acquire all of the common equity interest in Southern Community Financial. Our acquisition of Southern Community Financial is subject to Southern Community Financial stockholder approval, regulatory approvals and other customary closing conditions, and is expected to be completed in the second half of 2012. Although we were formed in November 2009, our activities prior to our first acquisition consisted solely of organizational, capital raising and related activities and activities related to identifying and analyzing potential acquisition candidates. We did not engage in any substantive operations (including banking operations) prior to our first acquisition.

The summary unaudited pro forma results of operations and condensed combined balance sheet information set forth below as of and for the six months ended June 30, 2012 has been derived from CBF’s, Capital Bank Corp.’s, Green Bankshares’ and Southern Community Financial’s historical unaudited financial statements as of and for the six months ended June 30, 2012. The summary unaudited pro forma results of operations and condensed combined balance sheet information set forth below for the year ended December 31, 2011 has been derived from CBF’s, Capital Bank Corp.’s, Green Bankshares’ and Southern Community Financial’s historical audited financial statements for the year ended December 31, 2011. The unaudited pro forma condensed combined financial information is presented for illustrative purposes only and does not necessarily indicate the operating results of the combined companies had they actually been combined on January 1, 2011.

The unaudited pro forma condensed combined financial information gives effect to and shows the pro forma impact on our historical financial statements of (1) the completion of our acquisition of Southern Community Financial, (2) the completion of our investments in TIB Financial, Capital Bank Corp. and Green Bankshares, and (3) the issuance of approximately 3,709,832 shares of Class A common stock to minority stockholders of TIB Financial, Capital Bank Corp. and Green Bankshares, each of which will be merged with the Company in the reorganization.


	Pro Forma
(Dollars in thousands, other than per share data)	For the Six Months Ended June 30, 2012		For the Year Ended December 31, 2011
Summary Results of Operations
Interest income	$	170,245	$	345,470
Interest expense		26,518		68,697

Net interest income		143,727		276,773
Provision for loan losses		17,184		97,328

Net interest income after provision for loan losses		126,543		179,445

Noninterest income		34,011		73,589
Noninterest expense		143,561		307,893

Income (loss) before income taxes		16,993		(54,859	)
Income tax expense (benefit)		6,538		(20,955	)

Net income (loss) before attribution of noncontrolling interests		10,455		(33,904	)
Net income (loss) attributable to noncontrolling interests		—		—

Net income (loss) attributable to CBF.	$	10,455	$	(33,904	)

Per Share Data
Earnings (loss)
Basic	$	0.21	$	(0.69	)

Diluted	$	0.21	$	(0.69	)

Weighted average shares outstanding
Basic		48,892,832		48,831,832

Diluted		49,187,832		49,093,832


	Pro Forma
(Dollars in thousands, except per share data)	June 30, 2012
Summary Balance Sheet Data
Cash and cash equivalents	$	256,880
Investment securities		1,477,731
Loans held for sale		16,483
Loans receivable:
Not covered under FDIC loss sharing agreements		4,563,915
Covered under FDIC loss sharing agreements		461,820
Allowance for loan losses		(45,472	)

Net loans		4,980,263

Other real estate owned		174,108
FDIC indemnification asset		60,750
Receivable from FDIC		9,699
Goodwill and intangible assets, net		171,568
Other assets		515,524

Total assets	$	7,663,006

Deposits	$	6,114,929
Advances from FHLB		145,469
Borrowings		323,499
Other liabilities		61,426

Total liabilities		6,645,323

Shareholders’ equity	$	1,017,683

Total liabilities and shareholders’ equity	$	7,663,006

Per Share Data
Tangible book value⁽¹⁾		$17.09

Common shares outstanding		50,166,353

⁽¹⁾


	Pro Forma
(Dollars in thousands, except per share data)	As of and for the Six Months Ended June 30, 2012
Total shareholders’ equity		$1,017,683
Less: Noncontrolling interest		–
Less: Goodwill		(142,161	)
Less: Core deposit intangibles, net of taxes		(17,962	)

Tangible book value		857,560
Book value per share		20.29
Tangible book value per share		17.09

The following table presents: (1) historical per share information for us; (2) pro forma per share information of the combined company after giving effect to the merger, the acquisition of Southern Community Financial by us and the mergers of our other bank holding company subsidiaries into us; and (3) historical and equivalent pro forma per share information for TIB Financial.

The combined company pro forma per share information was derived by combining information from the historical consolidated financial statements discussed under the heading “Summary Unaudited Pro Forma Condensed Combined Financial Data.” You should read this table together with the financial statements discussed under that heading. You should not rely on the pro forma per share information as being necessarily indicative of actual results had the merger occurred on January 1, 2011 for statement of operations purposes or June 30, 2012 for book value per share data.

There is currently no public market for shares of our Class A common stock. Substantially concurrent with the completion of the merger, we expect to complete an initial public offering of its Class A common stock. In connection with that initial public offering, we have applied to list our Class A common stock on the Nasdaq Global Select Market under the symbol “CBF.” Whether or not we complete an initial public offering prior to or concurrent with the completion of the merger, any shares of our common stock received as merger consideration by TIB Financial shareholders will be listed on the Nasdaq Global Select Market. Shares of TIB Financial common stock are listed and trade on the Nasdaq Capital Market under the symbol “TIBB.”

The following table presents the closing sales prices of shares of TIB Financial common stock as reported on the Nasdaq Capital Market, on (i) September 7, 2011, the last trading day for which market information is available prior to the public announcement of our intention to effect the merger and (ii) [—], 2012, the last practicable trading day prior to the date of this document.

The market price of TIB Financial common stock will fluctuate between the date of this document and the completion of the merger. We can give no assurance concerning the market price of our Class A common stock upon the completion of its initial public offering or following the merger.

In addition to the other information included in and incorporated by reference into this document, including the matters addressed in “Cautionary Note Regarding Forward-Looking Statements,” you should carefully consider the following risk factors.

We own approximately 94% of the common stock of TIB Financial. Accordingly, under Florida law, no vote of TIB Financial’s Board of Directors or shareholders is required to complete the merger. As a result, the merger may be completed even if opposed by all of the TIB Financial shareholders unaffiliated with us.

Neither we nor TIB Financial has hired anyone to represent you and we have a conflict of interest in the merger.

We and TIB Financial have not (1) negotiated the merger at arm’s length or (2) hired independent persons to negotiate the terms of the merger for you. Since we initiated and structured the merger without negotiating with TIB Financial or any independent person and we have an interest in acquiring your shares at the lowest possible price, if independent persons had been hired, the terms of the merger may have been more favorable to you.

Because there is currently no market for our Class A common stock and a market for our Class A common stock may not develop, you cannot be sure of the market value of the merger consideration you will receive.

Upon completion of the merger, each share of TIB Financial common stock will be converted into merger consideration consisting of 0.7205 of a share of our Class A common stock. Prior to the initial public offering of our Class A common stock, which we expect to complete substantially concurrent with the merger, there has been no established public market for our Class A common stock. An active, liquid trading market for our Class A common stock may not develop or be sustained following our initial public offering. If an active trading market does not develop, holders of our Class A common stock may have difficulty selling their shares at an attractive price, or at all. We have applied to have our Class A common stock listed on Nasdaq, but our application may not be approved. In addition, the liquidity of any market that may develop or the price that our stockholders may obtain for their shares of Class A common stock cannot be predicted. The initial public offering price for our Class A common stock will be determined by negotiations between us, our stockholders who choose to sell their shares in the initial public offering and the representative of the underwriters and may not be indicative of prices that will prevail in the open market following the offering. Furthermore, our initial public offering may be completed at a price that is below the range of prices set forth in this document.

The outcome of our initial public offering will affect the market value of the consideration TIB Financial shareholders will receive upon completion of the merger. Accordingly, you will not know or be able to calculate the market value of the merger consideration you would receive upon completion of the merger. There will be no adjustment to the exchange ratio for changes in the anticipated outcome of our initial public offering or changes in the market price of TIB Financial common stock.

If we complete the merger without completing our initial public offering, the size of the outstanding public float of our Class A common stock will be low and the value and liquidity of our common stock may be adversely affected.

While we expect to complete the merger substantially concurrent with our initial public offering, we control when the merger will take place and there can be no guarantee that our initial public offering will occur substantially concurrent with the merger or at all. If we complete the merger and our initial public offering is delayed or does not occur, shares of our Class A common stock received as merger consideration by TIB Financial shareholders will be listed on Nasdaq, but there will be fewer publicly traded shares outstanding than if we complete our initial public offering as anticipated and, as a result, the value and liquidity of our shares of Class A common stock that you receive in the merger may be adversely affected.

The shares of our Class A common stock to be received by TIB Financial shareholders as a result of the merger will have different rights than the shares of TIB Financial common stock.

The rights associated with TIB Financial common stock are different from the rights associated with our Class A common stock. For example, TIB Financial’s Board of Directors is divided into two classes, with the term of office of one class expiring each year. CBF’s Board of Directors will not be classified at the time of the merger. In addition, as a Florida corporation, TIB Financial is subject to provisions of Florida law that require a vote of at least two thirds of TIB Financial shareholders to approve business combinations with certain large shareholders (these provisions do not apply to the merger because CBF owns more than 90% of TIB Financial’s common stock). These provisions do not apply to CBF because it is a Delaware corporation. In addition, TIB Financial shareholders are permitted to act by written consent without a meeting, whereas CBF shareholders cannot act by written consent. Also, holders of at least 50% of TIB Financial’s common stock may call a special meeting of TIB Financial shareholders, whereas special meetings of CBF shareholders can only be called by CBF’s Chairman, Chief Executive Officer or its Board of Directors. See the section of this document entitled “Comparison of Rights of CBF Shareholders and TIB Financial Shareholders” on page 217 for a more detailed description of the shareholder rights of each corporation.

We have recently completed six acquisitions and have a limited operating history from which investors can evaluate our profitability and prospects.

We were organized in November 2009 and acquired certain of the assets and assumed certain liabilities of the three Failed Banks in July 2010. We also completed controlling investments in TIB Financial in September 2010, Capital Bank Corp. in January 2011 and Green Bankshares in September 2011. Because our banking operations began in 2010, we do not have a meaningful operating history upon which investors can evaluate our operational performance or compare our recent performance to historical performance. Although we acquired certain assets and assumed certain liabilities or made investments in six depository institutions which had operated for longer periods of time than we have, their business models and experiences are not reflective of our plans. Accordingly, our limited time running these companies’ operations may make it difficult to predict our future prospects and financial performance based on the prior performance of such depository institutions. Moreover, because a portion of the loans and other real estate we acquired in the acquisitions are covered by the loss sharing agreements and other loans and real estate we acquired were marked to fair value in connection with our acquisition of the Failed Banks’ businesses, the historical financial results of the acquired banks are less important to an understanding of our future operations. Certain other factors may also make it difficult to predict our future financial and operating performance, including, among others:

Our acquisition history may not be indicative of our ability to execute our growth strategy.

Our prior acquisitions should be viewed in the context of the recent opportunities available to us as a result of the confluence of our access to capital at a time when market dislocations of historical proportions resulted in attractive asset acquisition opportunities. As conditions change, we may prove to be unable to execute our growth strategy, which could impact our future earnings, reputation and results of operations. We have recently completed the process of integrating six of the acquired banking platforms into a single unified operating platform (the Failed Banks, TIB Financial, Capital Bank Corp. and Green Bankshares). See “—Risks Relating to CBF’s Growth Strategy.”

Continued or worsening general business and economic conditions could have a material adverse effect on our business, financial position, results of operations and cash flows.

Our business and operations are sensitive to general business and economic conditions in the United States. If the U.S. economy is unable to steadily emerge from the recent recession that began in 2007 or we experience worsening economic conditions, such as a so-called “double-dip” recession, our growth and profitability could be adversely affected. Weak economic conditions may be characterized by deflation, fluctuations in debt and equity capital markets, including a lack of liquidity and/or depressed prices in the secondary market for mortgage loans, increased delinquencies on mortgage, consumer and commercial loans, residential and commercial real estate price declines and lower home sales and commercial activity. All of these factors would be detrimental to our business. On August 5, 2011, Standard & Poor’s lowered the long-term sovereign credit rating of U.S. Government debt obligations from AAA to AA+. On August 8, 2011, S&P also downgraded the long-term credit ratings of U.S. government-sponsored enterprises. These actions initially have had an adverse effect on financial markets and although we are unable to predict the longer-term impact on such markets and the participants therein, it may be material and adverse.

In addition, significant concern regarding the creditworthiness of some of the governments in Europe, most notably Greece, Ireland, Portugal and, more recently, Spain, has contributed to volatility in financial markets in Europe and globally, and to funding pressures on some globally active European banks, leading to greater investor and economic uncertainty worldwide. A failure to adequately address sovereign debt concerns in Europe could hamper economic recovery or contribute to a return to recessionary economic conditions and severe stress in the financial markets, including in the United States.

Our business is also significantly affected by monetary and related policies of the U.S. federal government, its agencies and government-sponsored entities. Changes in any of these policies are influenced by macroeconomic conditions and other factors that are beyond our control, are difficult to predict and could have a material adverse effect on our business, financial position, results of operations and cash flows.

The geographic concentration of our markets in the southeastern region of the United States makes our business highly susceptible to downturns in the local economies and depressed banking markets, which could be detrimental to our financial condition.

Unlike larger financial institutions that are more geographically diversified, we are a regional banking franchise concentrated in the southeastern region of the United States. We operate branches located in Florida, North Carolina, South Carolina, Tennessee and Virginia. As of June 30, 2012, 33% of our loans were in Florida,

25% were in Tennessee, 27% were in North Carolina, 14% were in South Carolina and 1% were in Virginia. A deterioration in local economic conditions in the loan market or in the residential, commercial or industrial real estate market could have a material adverse effect on the quality of our portfolio, the demand for our products and services, the ability of borrowers to timely repay loans and the value of the collateral securing loans. In addition, if the population or income growth in the region is slower than projected, income levels, deposits and real estate development could be adversely affected and could result in the curtailment of our expansion, growth and profitability. If any of these developments were to result in losses that materially and adversely affected Capital Bank’s capital, we and Capital Bank might be subject to regulatory restrictions on operations and growth and to a requirement to raise additional capital. See “Supervision and Regulation.”

We depend on our executive officers and key personnel to continue the implementation of our long-term business strategy and could be harmed by the loss of their services.

We believe that our continued growth and future success will depend in large part on the skills of our management team and our ability to motivate and retain these individuals and other key personnel. In particular, we rely on the leadership and experience in the banking industry of our Chief Executive Officer R. Eugene Taylor. Mr. Taylor is the former Vice Chairman of Bank of America and has extensive experience executing and overseeing bank acquisitions, including NationsBank Corp.’s acquisition and integration of Bank of America, Maryland National Bank and Barnett Banks. The loss of service of Mr. Taylor or one or more of our other executive officers or key personnel could reduce our ability to successfully implement our long-term business strategy, our business could suffer and the value of our common stock could be materially adversely affected. Leadership changes will occur from time to time and we cannot predict whether significant resignations will occur or whether we will be able to recruit additional qualified personnel. We believe our management team possesses valuable knowledge about the banking industry and that their knowledge and relationships would be very difficult to replicate. Although Messrs. Taylor, Marshall, Singletary and Posner have each entered into an employment agreement with us, it is possible that they may not complete the term of their employment agreements or renew them upon expiration. Our success also depends on the experience of our branch managers and lending officers and on their relationships with the customers and communities they serve. The loss of these key personnel could negatively impact our banking operations. The loss of key personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on our business, financial condition or operating results.

Our loss sharing agreements impose restrictions on the operation of our business; failure to comply with the terms of our loss sharing agreements with the FDIC or other regulatory agreements or orders may result in significant losses or regulatory sanctions, and we are exposed to unrecoverable losses on the Failed Banks’ assets that we acquired.

In July 2010, we purchased substantially all of the assets and assumed all of the deposits and certain other liabilities of the Failed Banks in FDIC-assisted transactions, and a material portion of our revenue is derived from such assets. Certain of the purchased assets are covered by the loss sharing agreements with the FDIC, which provide that the FDIC will bear 80% of losses on the covered loan assets we acquired in our acquisition of the Failed Banks. We are subject to audit by the FDIC at its discretion to ensure we are in compliance with the terms of these agreements. We, may experience difficulties in complying with the requirements of the loss sharing agreements, the terms of which are extensive and failure to comply with any of the terms could result in a specific asset or group of assets losing their loss sharing coverage.

The FDIC has the right to refuse or delay payment partially or in full for such loan losses if we fail to comply with the terms of the loss sharing agreements, which are extensive. Additionally, the loss sharing agreements are limited in duration. Therefore, any losses that we experience after the terms of the loss sharing agreements have ended will not be recoverable from the FDIC, and would negatively impact our net income. See “Information about CBF—Our Acquisitions—Loss Sharing Agreements” for a description of the loss sharing arrangements with the FDIC.

Our loss sharing agreements also impose limitations on how we manage loans covered by loss sharing. For example, under the loss sharing agreements, we are not permitted to sell a covered loan even if in the ordinary course of our business we determine that taking such action would be advantageous for us. These restrictions could impair our ability to manage problem loans and extend the amount of time that such loans remain on our balance sheet and could negatively impact our business, financial condition, liquidity and results of operations.

In addition to the loss sharing agreements, in August 2010, Capital Bank entered into an Operating Agreement with the OCC (which we refer to as the “OCC Operating Agreement”), in connection with our acquisition of the Failed Banks. Capital Bank (and, with respect to certain provisions, the Company) is also subject to the FDIC Order issued in connection with the FDIC’s approval of our deposit insurance applications for the Failed Banks. The OCC Operating Agreement and the FDIC Order require that Capital Bank maintain various financial and capital ratios and require prior regulatory notice and consent to take certain actions in connection with operating the business and may restrict Capital Bank’s ability to pay dividends to us and to make changes to its capital structure. A failure by us or Capital Bank to comply with the requirements of the OCC Operating Agreement or the FDIC Order could subject us to regulatory sanctions; and failure to comply, or the objection, or imposition of additional conditions, by the OCC or the FDIC, in connection with any materials or information submitted thereunder, could prevent us from executing our business strategy and negatively impact our business, financial condition, liquidity and results of operations.

Any requested or required changes in how we determine the impact of loss share accounting on our financial information could have a material adverse effect on our reported results.

A material portion of our financial results is based on loss share accounting, which is subject to assumptions and judgments made by us, the regulatory agencies to whom we report such information. Loss share accounting is a complex accounting methodology. If these assumptions are incorrect or the regulatory agencies to whom we report require that we change or modify our assumptions, such change or modification could have a material adverse effect on our financial condition, operations or our previously reported results. As such, any financial information generated through the use of loss share accounting is subject to modification or change. Any significant modification or change in such information could have a material adverse effect on our results of operations and our previously reported results.

Our financial information reflects the application of the acquisition method of accounting. Any change in the assumptions used in such methodology could have an adverse effect on our results of operations.

As a result of our recent acquisitions, our financial results are heavily influenced by the application of the acquisition method of accounting. The acquisition method of accounting requires management to make assumptions regarding the assets purchased and liabilities assumed to determine their fair market value. Our interest income, interest expense and net interest margin (which were equal to $227.9 million, $36.6 million and 4.05%, respectively, in 2011) reflect the impact of accretion of the fair value adjustments made to the carrying amounts of interest earning assets and interest-bearing liabilities and our non-interest income (which totaled $41.2 million in 2011) for periods subsequent to the acquisitions includes the effects of discount accretion and amortization of the FDIC indemnification asset. In addition, the balances of non-performing assets were significantly reduced by the adjustments to fair value recorded in conjunction with the relevant acquisition. If our assumptions are incorrect or the regulatory agencies to whom we report require that we change or modify our assumptions, such change or modification could have a material adverse effect on our financial condition or results of operations or our previously reported results. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Accounting for Acquired Loans” for additional information on the impact of acquisition method of accounting to our financial operations.

As a lender, we are exposed to the risk that our customers will be unable to repay their loans according to their terms and that the collateral (if any) securing the payment of their loans may not be sufficient to assure

repayment. The risks inherent in making any loan include risks with respect to the period of time over which the loan may be repaid, risks relating to proper loan underwriting and guidelines, risks resulting from changes in economic and industry conditions, risks inherent in dealing with individual borrowers and risks resulting from uncertainties as to the future value of collateral. The credit standards, procedures and policies that we have established for borrowers may not prevent the incurrence of substantial credit losses.

Although we do not have a long enough operating history to have restructured many of our loans for borrowers in financial difficulty, in the future, we may restructure originated or acquired loans if we believe the borrowers have a viable business plan to fully pay off all obligations. However, for our originated loans, if interest rates or other terms are modified upon extension of credit or if terms of an existing loan are renewed in such a situation and a concession is granted, we may be required to classify such action as a troubled debt restructuring (which we refer to as a “TDR”). We would classify loans as TDRs when certain modifications are made to the loan terms and concessions are granted to the borrowers due to their financial difficulty. Generally, these loans would be restructured to provide the borrower additional time to execute its business plan. With respect to restructured loans, we may grant concessions by (1) reduction of the stated interest rate for the remaining original life of the debt or (2) extension of the maturity date at a stated interest rate lower than the current market rate for new debt with similar risk. In situations where a TDR is unsuccessful and the borrower is unable to satisfy the terms of the restructured agreement, the loan would be placed on nonaccrual status and written down to the underlying collateral value.

The ratio of our total non-performing loans not covered under loss sharing agreements with the FDIC to total loans has increased from 3.25% as of December 31, 2010 to 6.12% as of June 30, 2012 due primarily to our acquisitions of Capital Bank Corp. and Green Bankshares. In addition, the migration of loans to non-performing status based on our evaluation and re-grading of the portfolios of acquired loans following each acquisition, including the acquisitions of the Failed Banks and TIB Financial, has contributed to the increase in such ratio. At the same time, the overall ratio of non-performing loans to total loans declined from 11.12% as of December 31, 2010 to 8.36% as of June 30, 2012. This decline is due primarily to the increased proportion of loans originated by us under our credit policies and underwriting standards and the lower relative proportion of non-performing loans we acquired through the acquisitions of Capital Bank Corp. and Green Bankshares as compared to the Failed Banks. Non-performing loans include loans classified as non-accrual as well as loans which may be contractually past due 90 or more days but are still accruing interest either because they are well secured and in the process of collection or because they are accounted for according to accounting guidance for acquired impaired loans. One important component of our business strategy is sound risk management, including resolution of criticized and classified loans that totaled $748.6 million as of June 30, 2012. If management is unable to effectively resolve these loans, they would have a material adverse effect on our consolidated results of operations.

Recent economic and market developments and the potential for continued economic disruption present considerable risks to us and it is difficult to determine the depth and duration of the economic and financial market problems and the many ways in which they may impact our business in general. Any failure to manage such credit risks may materially adversely affect our business and our consolidated results of operations and financial condition.

A significant portion of our loan portfolio is secured by real estate, and events that negatively impact the real estate market could hurt our business.

A significant portion of our loan portfolio is secured by real estate. As of June 30, 2012, approximately 84% of our loans had real estate as a primary or secondary component of collateral. The real estate collateral in each case provides an alternate source of repayment in the event of default by the borrower and may deteriorate in value during the time the credit is extended. A continued weakening of the real estate market in our primary market areas could continue to result in an increase in the number of borrowers who default on their loans and a reduction in the value of the collateral securing their loans, which in turn could have an adverse effect on our profitability and asset quality. If we are required to liquidate the collateral securing a loan to satisfy the debt during a period of reduced real estate values, our earnings and shareholders’ equity could be adversely affected.

Additionally, recent weakness in the secondary market for residential lending could have an adverse impact on our profitability. Significant ongoing disruptions in the secondary market for residential mortgage loans have limited the market for and liquidity of most mortgage loans other than conforming Fannie Mae and Freddie Mac loans. The effects of ongoing mortgage market challenges, combined with the ongoing correction in residential real estate market prices and reduced levels of home sales, could result in further price reductions in single family home values, adversely affecting the value of collateral securing mortgage loans held, any future mortgage loan originations and gains on sale of mortgage loans. Continued declines in real estate values and home sales volumes and financial stress on borrowers as a result of job losses or other factors could have further adverse effects on borrowers that result in higher delinquencies and charge-offs in future periods, which could adversely affect our financial position and results of operations.

Our construction and land development loans are based upon estimates of costs and the values of the complete projects.

While we intend to focus on originating loans other than non-owner occupied commercial real estate loans, our portfolio includes construction and land development loans (which we refer to as “C&D loans”) extended to builders and developers, primarily for the construction and/or development of properties. These loans have been extended on a presold and speculative basis and they include loans for both residential and commercial purposes.

In general, C&D lending involves additional risks because of the inherent difficulty in estimating a property’s value both before and at completion of the project. Construction costs may exceed original estimates as a result of increased materials, labor or other costs. In addition, because of current uncertainties in the residential and commercial real estate markets, property values have become more difficult to determine than they have been historically. The repayment of construction and land acquisition and development loans is often dependent, in part, on the ability of the borrower to sell or lease the property. These loans also require ongoing monitoring. In addition, speculative construction loans to a residential builder are often associated with homes that are not presold and, thus, pose a greater potential risk than construction loans to individuals on their personal residences. Slowing housing sales have been a contributing factor to an increase in non-performing loans as well as an increase in delinquencies.

As of June 30, 2012, C&D loans totaled $440.4 million (or 11% of our total loan portfolio), of which $74.6 million was for construction and/or development of residential properties and $365.8 million was for construction/development of commercial properties. As of June 30, 2012, non-performing C&D loans covered under FDIC loss share agreements totaled $27.4 million and non-performing C&D loans not covered under FDIC loss share agreements totaled $94.8 million.

Our non-owner occupied commercial real estate loans may be dependent on factors outside the control of our borrowers.

While we intend to focus on originating loans other than non-owner occupied commercial real estate loans, in the acquisitions we acquired non-owner occupied commercial real estate loans for individuals and businesses for various purposes, which are secured by commercial properties. These loans typically involve repayment dependent upon income generated, or expected to be generated, by the property securing the loan in amounts sufficient to cover operating expenses and debt service. This may be adversely affected by changes in the economy or local market conditions. Non-owner occupied commercial real estate loans expose a lender to greater credit risk than loans secured by residential real estate because the collateral securing these loans typically cannot be liquidated as easily as residential real estate. In such cases, we may be compelled to modify the terms of the loan or engage in other potentially expensive work-out techniques. If we foreclose on a non-owner occupied commercial real estate loan, our holding period for the collateral typically is longer than a 1-4 family residential property because there are fewer potential purchasers of the collateral. Additionally, non-owner occupied commercial real estate loans generally have relatively large balances to single borrowers or related groups of borrowers. Accordingly, charge-offs on non-owner occupied commercial real estate loans may be larger on a per loan basis than those incurred with our residential or consumer loan portfolios.

As of June 30, 2012, our non-owner occupied commercial real estate loans totaled $849.8 million (or 20% of our total loan portfolio). As of June 30, 2012, non-performing non-owner occupied commercial real estate loans covered under FDIC loss share agreements totaled $22.8 million and non-performing non-owner occupied commercial real estate loans not covered under FDIC loss share agreements totaled $36.4 million.

Repayment of our commercial business loans is dependent on the cash flows of borrowers, which may be unpredictable, and the collateral securing these loans may fluctuate in value.

Our business plan focuses on originating different types of commercial business loans. We classify types of commercial loans offered as owner-occupied term real estate loans, business lines of credit and term equipment financing. Commercial business lending involves risks that are different from those associated with non-owner occupied commercial real estate lending. Our commercial business loans are primarily underwritten based on the cash flow of the borrower and secondarily on the underlying collateral, including real estate. The borrowers’ cash flow may be unpredictable, and collateral securing these loans may fluctuate in value. Some of our commercial business loans are collateralized by equipment, inventory, accounts receivable or other business assets, and the liquidation of collateral in the event of default is often an insufficient source of repayment because accounts receivable may be uncollectible and inventories may be obsolete or of limited use.

As of June 30, 2012, our commercial business loans totaled $1.5 billion (or 35% of our total loan portfolio). Of this amount, $1.0 billion was secured by owner-occupied real estate and $473.6 million was secured by business assets. As of June 30, 2012, non-performing commercial business loans covered under FDIC loss share agreements totaled $11.1 million and non-performing commercial business loans not covered under FDIC loss share agreements totaled $73.1 million.

Our allowance for loan losses and fair value adjustments may prove to be insufficient to absorb losses for loans that we originate.

Lending money is a substantial part of our business and each loan carries a certain risk that it will not be repaid in accordance with its terms or that any underlying collateral will not be sufficient to assure repayment. This risk is affected by, among other things:

Non-performing loans covered under loss share agreements with the FDIC totaled $93.7 million, and non-performing loans not covered under loss share agreements with the FDIC totaled $256.5 million as of June 30, 2012. We maintain an allowance for loan losses with respect to loans we originate, which is a reserve established through a provision for loan losses charged to expense, which we believe is appropriate to provide for probable losses in our loan portfolio. The amount of this allowance is determined by our management team through periodic reviews. As of June 30, 2012, the allowance on loans covered by loss share agreements with the FDIC was $14.6 million, and the allowance on loans not covered by loss share agreements with the FDIC was $30.9 million. As of June 30, 2012, the ratio of our allowance for loan losses to non-performing loans covered by loss share agreements with the FDIC was 15.6% and the ratio of our allowance for loan losses to non-performing loans not covered by loss share agreements with the FDIC was 12.0%.

The application of the acquisition method of accounting to our completed acquisitions impacted our allowance for loan losses. Under the acquisition method of accounting, all loans were recorded in our financial statements at their fair value at the time of their acquisition and the related allowance for loan loss was

eliminated because the fair value at the time was determined by the net present value of the expected cash flows taking into consideration estimated credit quality. We may in the future determine that our estimates of fair value are too high, in which case we would provide for additional loan losses associated with the acquired loans. As of June 30, 2012, the allowance for loan losses on PCI loan pools totaled $33.7 million, of which $14.6 million was related to loan pools covered by loss share agreements with the FDIC and $19.0 million was related to loan pools not covered by loss share agreements with the FDIC.

The determination of the appropriate level of the allowance for loan losses inherently involves a high degree of subjectivity and requires us to make significant estimates of current credit risks and future trends, all of which may undergo material changes. Changes in economic conditions affecting borrowers, new information regarding existing loans that we originate, identification of additional problem loans originated by us and other factors, both within and outside of our control, may require an increase in the allowance for loan losses. If current trends in the real estate markets continue, we expect that we will continue to experience increased delinquencies and credit losses, particularly with respect to construction, land development and land loans. In addition, bank regulatory agencies periodically review our allowance for loan losses and may require an increase in the provision for probable loan losses or the recognition of further loan charge-offs, based on judgments different than those of management. In addition, if charge-offs in future periods exceed the allowance for loan losses, we will need additional provisions to increase the allowance for loan losses. Any increases in the allowance for loan losses will result in a decrease in net income and, possibly, capital and may have a material adverse effect on our financial condition and results of operations.

We continue to hold and acquire other real estate, which has led to increased operating expenses and vulnerability to additional declines in real property values.

We foreclose on and take title to the real estate serving as collateral for many of our loans as part of our business. Real estate owned by us and not used in the ordinary course of its operations is referred to as “other real estate owned” or “OREO” property. At June 30, 2012, we had $158.2 million of OREO. Increased OREO balances have led to greater expenses as we incur costs to manage and dispose of the properties. We expect that our earnings will continue to be negatively affected by various expenses associated with OREO, including personnel costs, insurance and taxes, completion and repair costs, valuation adjustments and other expenses associated with property ownership, as well as by the funding costs associated with assets that are tied up in OREO. Any further decrease in real estate market prices may lead to additional OREO write-downs, with a corresponding expense in our statement of operations. We evaluate OREO properties periodically and write down the carrying value of the properties if the results of our evaluation require it. The expenses associated with OREO and any further property write-downs could have a material adverse effect on our financial condition and results of operations.

We are subject to environmental liability risk associated with lending activities.

A significant portion of our loan portfolio is secured by real property. During the ordinary course of business, we may foreclose on and take title to properties securing certain loans. In doing so, there is a risk that hazardous or toxic substances could be found on these properties. If hazardous or toxic substances are found, we may be liable for remediation costs, as well as for personal injury and property damage. Environmental laws may require us to incur substantial expenses to address unknown liabilities and may materially reduce the affected property’s value or limit our ability to use or sell the affected property. In addition, future laws or more stringent interpretations or enforcement policies with respect to existing laws may increase our exposure to environmental liability. Although we have policies and procedures to perform an environmental review before initiating any foreclosure action on nonresidential real property, these reviews may not be sufficient to detect all potential environmental hazards. The remediation costs and any other financial liabilities associated with an environmental hazard could have a material adverse effect on our financial condition and results of operations.

Delinquencies and defaults in residential mortgages have increased, creating a backlog in courts and an increase in industry scrutiny by regulators, as well as resulting in proposed new laws and regulations governing foreclosures. Such laws and regulations might restrict or delay our ability to foreclose and collect payments for single family residential loans under the loss sharing agreements.

Recent laws delay the initiation or completion of foreclosure proceedings on specified types of residential mortgage loans (some for a limited period of time), or otherwise limit the ability of residential loan servicers to take actions that may be essential to preserve the value of the mortgage loans. Any such limitations are likely to cause delayed or reduced collections from mortgagors and generally increased servicing costs. As a servicer of mortgage loans, any restriction on our ability to foreclose on a loan, any requirement that we forego a portion of the amount otherwise due on a loan or any requirement that we modify any original loan terms will in some instances require us to advance principal, interest, tax and insurance payments, which may negatively impact our business, financial condition, liquidity and results of operations.

In addition, for the single family residential loans covered by the loss sharing agreements, we cannot collect loss share payments until we liquidate the properties securing those loans. These loss share payments could be delayed by an extended foreclosure process, including delays resulting from a court backlog, local or national foreclosure moratoriums or other delays, and these delays could have a material adverse effect on our results of operations.

Like other financial services institutions, our asset and liability structures are monetary in nature. Such structures are affected by a variety of factors, including changes in interest rates, which can impact the value of financial instruments held by us.

Like other financial services institutions, we have asset and liability structures that are essentially monetary in nature and are directly affected by many factors, including domestic and international economic and political conditions, broad trends in business and finance, legislation and regulation affecting the national and international business and financial communities, monetary and fiscal policies, inflation, currency values, market conditions, the availability and cost of short-term or long-term funding and capital, the credit capacity or perceived creditworthiness of customers and counterparties and the level and volatility of trading markets. Such factors can impact customers and counterparties of a financial services institution and may impact the value of financial instruments held by a financial services institution.

Our earnings and cash flows largely depend upon the level of our net interest income, which is the difference between the interest income we earn on loans, investments and other interest earning assets, and the interest we pay on interest-bearing liabilities, such as deposits and borrowings. Because different types of assets and liabilities may react differently and at different times to market interest rate changes, changes in interest rates can increase or decrease our net interest income. When interest-bearing liabilities mature or reprice more quickly than interest-earning assets in a period, an increase in interest rates could reduce net interest income. Similarly, when interest-earning assets mature or reprice more quickly, and because the magnitude of repricing of interest earning assets is often greater than interest-bearing liabilities, falling interest rates could reduce net interest income.

Additionally, an increase in interest rates may, among other things, reduce the demand for loans and our ability to originate loans and decrease loan repayment rates, while a decrease in the general level of interest rates may adversely affect the fair value of our financial assets and liabilities and our ability to realize gains on the sale of assets. A decrease in the general level of interest rates may affect us through, among other things, increased prepayments on our loan and mortgage-backed securities portfolios and increased competition for deposits.

Accordingly, changes in the level of market interest rates affect our net yield on interest earning assets, loan origination volume, loan and mortgage-backed securities portfolios and our overall results. Changes in interest rates may also have a significant impact on any future mortgage loan origination revenues. Historically, there has been an inverse correlation between the demand for mortgage loans and interest rates. Mortgage origination

volume and revenues usually decline during periods of rising or high interest rates and increase during periods of declining or low interest rates. Changes in interest rates also have a significant impact on the carrying value of a significant percentage of the assets on our balance sheet. Interest rates are highly sensitive to many factors beyond our control, including general economic conditions and policies of various governmental and regulatory agencies, particularly the Board of Governors of the Federal Reserve System (which we refer to as the “Federal Reserve”). We cannot predict the nature and timing of the Federal Reserve’s interest rate policies or other changes in monetary policies and economic conditions, which could negatively impact our financial performance.

We have benefited in recent periods from a favorable interest rate environment, but we believe that this environment cannot be sustained indefinitely and interest rates would be expected to rise as the economy recovers. A strengthening U.S. economy would be expected to cause the Board of Governors of the Federal Reserve to increase short-term interest rates, which would increase our borrowing costs.

The fair value of our investment securities can fluctuate due to market conditions out of our control.

As of June 30, 2012, approximately 99% of our investment securities portfolio was comprised of U.S. government agency and sponsored enterprises obligations, U.S. government agency and sponsored enterprises mortgage-backed securities and securities of municipalities. As of June 30, 2012, the fair value of our investment securities portfolio was approximately $1.2 billion. Factors beyond our control can significantly influence the fair value of securities in our portfolio and can cause potential adverse changes to the fair value of these securities. These factors include, but are not limited to, rating agency downgrades of the securities, defaults by the issuer or with respect to the underlying securities, changes in market interest rates and continued instability in the credit markets. In addition, we have historically taken a conservative investment posture, concentrating on government issuances of short duration. In the future, we may seek to increase yields through more aggressive investment strategies, which may include a greater percentage of corporate issuances and structured credit products. Any of these mentioned factors, among others, could cause other-than-temporary impairments in future periods and result in a realized loss, which could have a material adverse effect on our business. The process for determining whether impairment is other-than-temporary usually requires complex, subjective judgments about the future financial performance of the issuer and any collateral underlying the security in order to assess the probability of receiving all contractual principal and interest payments on the security. Because of changing economic and market conditions affecting issuers and the performance of the underlying collateral, we may recognize realized and/or unrealized losses in future periods, which could have an adverse effect on our financial condition and results of operations.

We have a significant deferred tax asset that may not be fully realized in the future.

Our net deferred tax asset totaled $140.7 million as of June 30, 2012, of which $108.7 million was excluded from Tier 1 Capital. The ultimate realization of a deferred tax asset is dependent upon the generation of future taxable income during the periods prior to the expiration of the related net operating losses and the limitations of Section 382 of the Internal Revenue Code. If our estimates and assumptions about future taxable income are not accurate, the value of our deferred tax asset may not be recoverable and may result in a valuation allowance that would impact our earnings.

Recent market disruptions have caused increased liquidity risks and, if we are unable to maintain sufficient liquidity, we may not be able to meet the cash flow requirements of our depositors and borrowers.

The recent disruption and illiquidity in the credit markets have generally made potential funding sources more difficult to access, less reliable and more expensive. Our liquidity is generally used to make loans and to repay deposit liabilities as they become due or are demanded by customers, and further deterioration in the credit markets or a prolonged period without improvement of market liquidity could present significant challenges in the management of our liquidity and could adversely affect our business, results of operations and prospects. For

example, if as a result of a sudden decline in depositor confidence resulting from negative market conditions, a substantial number of bank customers tried to withdraw their bank deposits simultaneously, our reserves may not be able to cover the withdrawals.

Furthermore, an inability to increase our deposit base at all or at attractive rates would impede our ability to fund our continued growth, which could have an adverse effect on our business, results of operations and financial condition. Collateralized borrowings such as advances from the FHLB are an important potential source of liquidity. Our borrowing capacity is generally dependent on the value of the collateral pledged to the FHLB. An adverse regulatory change could reduce our borrowing capacity or eliminate certain types of collateral and could otherwise modify or even eliminate our access to FHLB advances, Federal Fund line borrowings and discount window advances. Liquidity may also be adversely impacted by bank supervisory and regulatory authorities mandating changes in the composition of our balance sheet to asset classes that are less liquid. Any such change or termination may have an adverse effect on our liquidity.

Our access to other funding sources could be impaired by factors that are not specific to us, such as a disruption in the financial markets or negative views and expectations about the prospects for the financial services industry in light of recent turmoil faced by banking organizations and the unstable credit markets. We may need to incur additional debt in the future to achieve our business objectives, in connection with future acquisitions or for other reasons. Any borrowings, if sought, may not be available to us or, if available, may not be on favorable terms. Without sufficient liquidity, we may not be able to meet the cash flow requirements of our depositors and borrowers, which could have a material adverse effect on our financial condition and results of operations.

We may not be able to retain or develop a strong core deposit base or other low-cost funding sources.

We expect to depend on checking, savings and money market deposit account balances and other forms of customer deposits as our primary source of funding for our lending activities. Our future growth will largely depend on our ability to retain and grow a strong deposit base. Because 38% of our deposits as of June 30, 2012 were time deposits, it may prove harder to maintain and grow our deposit base than would otherwise be the case. We are also working to transition certain of our customers to lower cost traditional banking services as higher cost funding sources, such as high interest certificates of deposit, mature. There may be competitive pressures to pay higher interest rates on deposits, which could increase funding costs and compress net interest margins. Customers may not transition to lower yielding savings or investment products or continue their business with us, which could adversely affect our operations. In addition, with recent concerns about bank failures, customers have become concerned about the extent to which their deposits are insured by the FDIC, particularly customers that may maintain deposits in excess of insured limits. Customers may withdraw deposits in an effort to ensure that the amount that they have on deposit with us is fully insured and may place them in other institutions or make investments that are perceived as being more secure. Further, even if we are able to grow and maintain our deposit base, the account and deposit balances can decrease when customers perceive alternative investments, such as the stock market, as providing a better risk/return tradeoff. If customers move money out of bank deposits and into other investments (or similar products at other institutions that may provide a higher rate of return), we could lose a relatively low cost source of funds, increasing our funding costs and reducing our net interest income and net income. Additionally, any such loss of funds could result in lower loan originations, which could materially negatively impact our growth strategy and results of operations.

We operate in a highly competitive industry and face significant competition from other financial institutions and financial services providers, which may decrease our growth or profits.

Consumer and commercial banking is highly competitive. Our market contains not only a large number of community and regional banks, but also a significant presence of the country’s largest commercial banks. We compete with other state and national financial institutions as well as savings and loan associations, savings banks and credit unions for deposits and loans. In addition, we compete with financial intermediaries, such as

consumer finance companies, mortgage banking companies, insurance companies, securities firms, mutual funds and several government agencies as well as major retailers, all actively engaged in providing various types of loans and other financial services. Some of these competitors may have a long history of successful operations in our markets, greater ties to local businesses and more expansive banking relationships, as well as better established depositor bases. Competitors with greater resources may possess an advantage by being capable of maintaining numerous banking locations in more convenient sites, operating more ATMs and conducting extensive promotional and advertising campaigns or operating a more developed Internet platform.

The financial services industry could become even more competitive as a result of legislative, regulatory and technological changes and continued consolidation. Banks, securities firms and insurance companies can merge under the umbrella of a financial holding company, which can offer virtually any type of financial service, including banking, securities underwriting, insurance (both agency and underwriting) and merchant banking. Increased competition among financial services companies due to the recent consolidation of certain competing financial institutions may adversely affect our ability to market our products and services. Also, technology has lowered barriers to entry and made it possible for banks to compete in our market without a retail footprint by offering competitive rates, as well as non-banks to offer products and services traditionally provided by banks. Many of our competitors have fewer regulatory constraints and may have lower cost structures. Additionally, due to their size, many competitors may offer a broader range of products and services as well as better pricing for certain products and services than we can.

Failure to perform in any of these areas could significantly weaken our competitive position, which could adversely affect our growth and profitability, which, in turn, could harm our business, financial condition and results of operations.

We may be adversely affected by the lack of soundness of other financial institutions.

Our ability to engage in routine funding and other transactions could be adversely affected by the actions and commercial soundness of other financial institutions. Financial services institutions are interrelated as a result of trading, clearing, counterparty or other relationships. Defaults by, or even rumors or questions about, one or more financial institutions, or the financial services industry generally, may lead to market-wide liquidity problems and losses of depositor, creditor and counterparty confidence and could lead to losses or defaults by us or by other institutions.

We are subject to losses due to the errors or fraudulent behavior of employees or third parties.

We are exposed to many types of operational risk, including the risk of fraud by employees and outsiders, clerical recordkeeping errors and transactional errors. Our business is dependent on our employees as well as third-party service providers to process a large number of increasingly complex transactions. We could be materially adversely affected if one of our employees causes a significant operational breakdown or failure,

either as a result of human error or where an individual purposefully sabotages or fraudulently manipulates our operations or systems. When we originate loans, we rely upon information supplied by loan applicants and third parties, including the information contained in the loan application, property appraisal and title information, if applicable, and employment and income documentation provided by third parties. If any of this information is misrepresented and such misrepresentation is not detected prior to loan funding, we generally bear the risk of loss associated with the misrepresentation. Any of these occurrences could result in a diminished ability of us to operate our business, potential liability to customers, reputational damage and regulatory intervention, which could negatively impact our business, financial condition and results of operations.

We are dependent on our information technology and telecommunications systems and third-party servicers, and systems failures, interruptions or breaches of security could have an adverse effect on our financial condition and results of operations.

Our business is highly dependent on the successful and uninterrupted functioning of our information technology and telecommunications systems and third-party servicers. We outsource many of our major systems, such as data processing, loan servicing and deposit processing systems. The failure of these systems, or the termination of a third-party software license or service agreement on which any of these systems is based, could interrupt our operations. Because our information technology and telecommunications systems interface with and depend on third-party systems, we could experience service denials if demand for such services exceeds capacity or such third-party systems fail or experience interruptions. If sustained or repeated, a system failure or service denial could result in a deterioration of our ability to process new and renewal loans, gather deposits and provide customer service, compromise our ability to operate effectively, damage our reputation, result in a loss of customer business and/or subject us to additional regulatory scrutiny and possible financial liability, any of which could have a material adverse effect on our financial condition and results of operations.

In addition, we provide our customers the ability to bank remotely, including online over the Internet. The secure transmission of confidential information is a critical element of remote banking. Our network could be vulnerable to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss and other security breaches. We may be required to spend significant capital and other resources to protect against the threat of security breaches and computer viruses, or to alleviate problems caused by security breaches or viruses. To the extent that our activities or the activities of our customers involve the storage and transmission of confidential information, security breaches and viruses could expose us to claims, litigation and other possible liabilities. Any inability to prevent security breaches or computer viruses could also cause existing customers to lose confidence in our systems and could adversely affect our reputation, results of operations and ability to attract and maintain customers and businesses. In addition, a security breach could also subject us to additional regulatory scrutiny, expose us to civil litigation and possible financial liability and cause reputational damage.

As a public company, we will be required to meet periodic reporting requirements under the rules and regulations of the United States Securities and Exchange Commission. Complying with federal securities laws as a public company is expensive, and we will incur significant time and expense enhancing, documenting, testing and certifying our internal control over financial reporting. Any deficiencies in our financial reporting or internal controls could adversely affect our business and the trading price of our Class A common stock.

Prior to becoming a public company, we have not been required to comply with Securities and Exchange Commission (which we refer to as the “SEC”) requirements to have our financial statements completed and reviewed or audited within a specified time. As a publicly traded company following completion of the merger, we will be required to file periodic reports containing our financial statements with the SEC within a specified time following the completion of quarterly and annual periods. We will also be required to comply with certain provisions of Section 404 of the Sarbanes-Oxley Act of 2002 concerning internal controls over financial reporting commencing in the 2013 fiscal year as described below. We may experience difficulty in meeting the SEC’s reporting requirements. Any failure by us to file our periodic reports with the SEC in a timely manner could harm our reputation and reduce the trading price of our Class A common stock.

As a public company, we will incur significant legal, accounting, insurance and other expenses. Compliance with other rules of the SEC and the rules of Nasdaq will increase our legal and financial compliance costs and make some activities more time consuming and costly. Beginning with our Annual Report on Form 10-K for our fiscal year ending December 31, 2013, SEC rules will require that our Chief Executive Officer and Chief Financial Officer periodically certify the existence and effectiveness of our internal controls over financial reporting. Beginning with the fiscal year ending December 31, 2018, or such earlier time as we are no longer an “emerging growth company” as defined in the Jumpstart Our Business Startups Act (which we refer to as the “JOBS Act”), our independent registered public accounting firm will be required to attest to our assessment of our internal controls over financial reporting. This process will require significant documentation of policies, procedures and systems, review of that documentation by our internal auditing staff and our outside auditors and testing of our internal controls over financial reporting by our internal auditing and accounting staff and our outside independent registered public accounting firm. This process will involve considerable time and expense, may strain our internal resources and have an adverse impact on our operating costs. We may experience higher than anticipated operating expenses and outside auditor fees during the implementation of these changes and thereafter.

During the course of our testing, we may identify deficiencies that would have to be remediated to satisfy the SEC rules for certification of our internal controls over financial reporting. As a consequence, we may have to disclose in periodic reports we file with the SEC material weaknesses in our system of internal controls. The existence of a material weakness would preclude management from concluding that our internal controls over financial reporting are effective and would preclude our independent auditors from issuing an unqualified opinion that our internal controls over financial reporting are effective. In addition, disclosures of this type in our SEC reports could cause investors to lose confidence in our financial reporting and may negatively affect the trading price of our Class A common stock. Moreover, effective internal controls are necessary to produce reliable financial reports and to prevent fraud. If we have deficiencies in our disclosure controls and procedures or internal controls over financial reporting, it may negatively impact our business, results of operations and reputation.

A material weakness in our internal control over financial reporting was identified for the year ended December 31, 2011 and we have determined that we must enhance our internal audit function. Material weaknesses in our financial reporting or internal controls or gaps in our internal audit procedures could adversely affect our business and the trading price of our Class A common stock.

In connection with management’s assessment of internal control over financial reporting, we identified a material weakness in such internal control during the audit of our consolidated financial statements for the year ended December 31, 2011 related to third-party data inputs used in the accounting of impaired loans under ASC 310-30 in the fourth quarter of 2011. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness that we identified was considered in determining the nature, timing, and extent of audit tests applied in the audit of our consolidated financial statements for the year ended December 31, 2011 and did not affect our independent auditor’s report on the consolidated financial statements dated April 10, 2012, which expressed an unqualified opinion on our consolidated financial statements. We have implemented and will continue to implement measures designed to improve our internal control over financial reporting and strengthen our internal audit function. These measures include, among other things, supplementing the personnel involved in overseeing financial reporting. We have also validated the calculations of, and added additional control points to the development of the manual and spreadsheet outputs generated by the third-party valuation specialists engaged to assist in estimating the cash flow re-estimation, impairment and accretion values in the loan accounting process. While we believe that the actions we are taking and will continue to take to address the existing weakness in internal control over financial reporting and strengthen our internal audit function will mitigate the risk related to the aforementioned internal control material weakness and internal audit matters, we cannot be certain that, at some point in the future, another material weakness will not be identified or our internal audit procedures will not fail to detect a matter they are designed to prevent, and failure to remedy such material weaknesses or enhance our internal audit function could have an adverse impact on our financials and the operation of our business.

In addition to the material weakness we reported, Green Bankshares reported a material weakness in its internal control over financial reporting in its financial statements for the year ended December 31, 2010. Failure to remediate such material weaknesses of our subsidiaries could also have an adverse effect on us. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Material Trends and Developments” for information regarding actions we have taken to achieve and maintain effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act.

We are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Class A common stock less attractive to investors. In addition, our election not to opt out of JOBS Act extended accounting transition period may make our financial statements less easily comparable to the financial statements of other companies.

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. In addition, even if we comply with the greater obligations of public companies that are not emerging growth companies immediately after the initial public offering, we may avail ourselves of the reduced requirements applicable to emerging growth companies from time to time in the future, so long as we are an emerging growth company. We will remain an emerging growth company for up to five years, though we may cease to be an emerging growth company earlier under certain circumstances, including if, before the end of such five years, we are deemed to be a large accelerated filer under the rules of the SEC (which depends on, among other things, having a market value of common stock held by non-affiliates in excess of $700 million). We cannot predict if investors will find our Class A common stock less attractive because we will rely on these exemptions. If some investors find our Class A common stock less attractive as a result, there may be a less active trading market for our Class A common stock and our stock price may be more volatile.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Hurricanes or other adverse weather events would negatively affect our local economies or disrupt our operations, which would have an adverse effect on our business or results of operations.

Our market areas in the southeastern region of the United States are susceptible to natural disasters, such as hurricanes, tornadoes, tropical storms, other severe weather events and related flooding and wind damage, and manmade disasters, such as the 2010 oil spill in the Gulf of Mexico. Our market areas in Tennessee are susceptible to natural disasters, such as tornadoes and floods. These natural disasters could negatively impact regional economic conditions, cause a decline in the value or destruction of mortgaged properties and an increase in the risk of delinquencies, foreclosures or loss on loans originated by us, damage our banking facilities and

offices and negatively impact our growth strategy. Such weather events can disrupt operations, result in damage to properties and negatively affect the local economies in the markets where they operate. We cannot predict whether or to what extent damage that may be caused by future hurricanes or tornadoes will affect our operations or the economies in our current or future market areas, but such weather events could negatively impact economic conditions in these regions and result in a decline in local loan demand and loan originations, a decline in the value or destruction of properties securing our loans and an increase in delinquencies, foreclosures or loan losses. Our business or results of operations may be adversely affected by these and other negative effects of natural or manmade disasters.

Our future operating results depend to a large extent on our ability to successfully manage our rapid growth. Our rapid growth has placed, and it may continue to place, significant demands on our operations and management. Whether through additional acquisitions or organic growth, our current plan to expand our business is dependent upon:

We may not successfully implement improvements to, or integrate, our management information and control systems, procedures and processes in an efficient or timely manner and may discover deficiencies in existing systems and controls. In particular, our controls and procedures must be able to accommodate an increase in expected loan volume and the infrastructure that comes with new branches and banks. Thus, our growth strategy may divert management from our existing businesses and may require us to incur additional expenditures to expand our administrative and operational infrastructure and, if we are unable to effectively manage and grow our banking franchise, our business and our consolidated results of operations and financial condition could be materially and adversely impacted. In addition, if we are unable to manage future expansion in our operations, we may experience compliance and operational problems, have to slow the pace of growth, or have to incur additional expenditures beyond current projections to support such growth, any one of which could adversely affect our business.

Many of our new activities and expansion plans require regulatory approvals, and failure to obtain them may restrict our growth.

We intend to complement and expand our business by pursuing strategic acquisitions of banks and other financial institutions. Generally, any acquisition of target financial institutions or assets by us will require approval by, and cooperation from, a number of governmental regulatory agencies, possibly including the Federal Reserve, the OCC and the FDIC, as well as state banking regulators. In acting on such applications of approval, federal banking regulators consider, among other factors:

Such regulators could deny our application based on the above criteria or other considerations or the regulatory approvals may not be granted on terms that are acceptable to us. For example, we could be required to sell branches as a condition to receiving regulatory approvals, and such a condition may not be acceptable to us or may reduce the benefit of any acquisition.

The success of future transactions will depend on our ability to successfully identify and consummate transactions with target financial institutions that meet our investment criteria. Because of the significant competition for acquisition opportunities and the limited number of potential targets, we may not be able to successfully consummate acquisitions necessary to grow our business.

The success of future transactions will depend on our ability to successfully identify and consummate transactions with target financial institutions that meet our investment criteria. There are significant risks associated with our ability to identify and successfully consummate transactions with target financial institutions. There are a limited number of acquisition opportunities, and we expect to encounter intense competition from other banking organizations competing for acquisitions and also from other investment funds and entities looking to acquire financial institutions. Many of these entities are well established and have extensive experience in identifying and effecting acquisitions directly or through affiliates. Many of these competitors possess ongoing banking operations with greater technical, human and other resources than we do, and our financial resources will be relatively limited when contrasted with those of many of these competitors. These organizations may be able to achieve greater cost savings through consolidating operations than we could. Our ability to compete in acquiring certain sizable target institutions will be limited by our available financial resources. These inherent competitive limitations give others an advantage in pursuing the acquisition of certain target financial institutions. In addition, increased competition may drive up the prices for the types of acquisitions we intend to target, which would make the identification and successful consummation of acquisition opportunities more difficult. Competitors may be willing to pay more for target financial institutions than we believe are justified, which could result in us having to pay more for target financial institutions than we prefer or to forego target financial institutions. As a result of the foregoing, we may be unable to successfully identify and consummate future transactions to grow our business on commercially attractive terms, or at all.

Because the institutions we intend to acquire may have distressed assets, we may not be able to realize the value we predict from these assets or make sufficient provision for future losses in the value of, or accurately estimate the future writedowns taken in respect of, these assets.

Delinquencies and losses in the loan portfolios and other assets of financial institutions that we acquire may exceed our initial forecasts developed during the due diligence investigation prior to acquiring those institutions. Even if we conduct extensive due diligence on an entity we decide to acquire, this diligence may not reveal all material issues that may affect a particular entity. The diligence process in FDIC-assisted transactions is also expedited due to the short acquisition timeline that is typical for these depository institutions. If, during the diligence process, we fail to identify issues specific to an entity or the environment in which the entity operates, we may be forced to later write down or write off assets, restructure our operations, or incur impairment or other charges that could result in other reporting losses. Any of these events could adversely affect the financial condition, liquidity, capital position and value of institutions we acquire and of the Company as a whole. If any of the foregoing adverse events occur with respect to one subsidiary, they may adversely affect other of our subsidiaries or the Company as a whole. Current economic conditions have created an uncertain environment with respect to asset valuations and there is no certainty that we will be able to sell assets of target institutions if we determine it would be in our best interests to do so. The institutions we will target may have substantial amounts of asset classes for which there is currently limited or no marketability.

The success of future transactions will depend on our ability to successfully combine the target financial institution’s business with our existing banking business and, if we experience difficulties with the integration process, the anticipated benefits of the acquisition may not be realized fully or at all or may take longer to realize than expected.

The success of future transactions will depend, in part, on our ability to successfully combine the target financial institution’s business with our existing banking business. As with any acquisition involving financial institutions, there may be business disruptions that result in the loss of customers or cause customers to remove their accounts and move their business to competing banking institutions. It is possible that the integration process could result in additional expenses in connection with the integration processes and the disruption of ongoing business or inconsistencies in standards, controls, procedures and policies that adversely affect our ability to maintain relationships with clients, customers, depositors and employees or to achieve the anticipated benefits of the acquisition. Integration efforts, including integration of the target financial institution’s systems into our systems may divert our management’s attention and resources, and we may be unable to develop, or experience prolonged delays in the development of, the systems necessary to operate our acquired banks, such as a financial reporting platform or a human resources reporting platform call center. If we experience difficulties with the integration process, the anticipated benefits of any future transaction may not be realized fully or at all or may take longer to realize than expected. Additionally, we may be unable to recognize synergies, operating efficiencies and/or expected benefits within expected timeframes or expected cost projections, or at all. We may also not be able to preserve the goodwill of the acquired financial institution.

Our pending transaction with Southern Community Financial may present certain risks to our business and operations.

On March 26, 2012, we entered into an agreement to acquire Southern Community Financial, which agreement was amended on June 25, 2012. This investment presents the following risks, among others:

Projected operating results for entities to be acquired by us may be inaccurate and may vary significantly from actual results.

We will generally establish the pricing of transactions and the capital structure of entities to be acquired by us on the basis of financial projections for such entities. In general, projected operating results will be based primarily on management judgments. In all cases, projections are only estimates of future results that are based upon assumptions made at the time that the projections are developed and the projected results may vary significantly from actual results. General economic, political and market conditions, which are not predictable, can have a material adverse impact on the reliability of such projections. In the event that the projections made in

connection with our acquisitions, or future projections with respect to new acquisitions, are not accurate, such inaccuracies could materially and adversely affect our business and our consolidated results of operations and financial condition.

Our officers and directors may have conflicts of interest in determining whether to present business opportunities to us or another entity with which they are, or may become, affiliated.

Our officers and directors may become subject to fiduciary obligations in connection with their service on the boards of directors of other corporations. To the extent that our officers and directors become aware of acquisition opportunities that may be suitable for entities other than us to which they have fiduciary or contractual obligations, or they are presented with such opportunities in their capacities as fiduciaries to such entities, they may honor such obligations to such other entities. In addition, our officers and directors will not have any obligation to present us with any acquisition opportunity that does not fall within certain parameters of our business (which opportunities and parameters are described in more detail in the section entitled “Information about CBF”). You should assume that to the extent any of our officers or directors becomes aware of an opportunity that may be suitable both for us and another entity to which such person has a fiduciary obligation or contractual obligation to present such opportunity as set forth above, he or she may first give the opportunity to such other entity or entities and may give such opportunity to us only to the extent such other entity or entities reject or are unable to pursue such opportunity. In addition, you should assume that to the extent any of our officers or directors becomes aware of an acquisition opportunity that does not fall within the above parameters but that may otherwise be suitable for us, he or she may not present such opportunity to us. In general, officers and directors of a corporation incorporated under Delaware law are required to present business opportunities to a corporation if the corporation could financially undertake the opportunity, the opportunity is within the corporation’s line of business and it would not be fair to the corporation and its stockholders for the opportunity not to be brought to the attention of the corporation. However, our certificate of incorporation provides that we renounce any interest or expectancy in certain acquisition opportunities that our officers or directors become aware of in connection with their service to other entities to which they have a fiduciary or contractual obligation.

Changes in accounting standards may affect how we report our financial condition and results of operations.

Our accounting policies and methods are fundamental to how we record and report our financial condition and results of operations. From time to time, the Financial Accounting Standards Board (which we refer to as the “FASB”) or other regulatory authorities change the financial accounting and reporting standards that govern the preparation of financial statements. These changes can be hard to predict and can materially impact how we record and report our financial condition and results of operations. In some cases, we could be required to apply a new or revised standard retroactively, resulting in us restating prior period financial statements.

We operate in a highly regulated industry and the laws and regulations that govern our operations, corporate governance, executive compensation and financial accounting, or reporting, including changes in them or our failure to comply with them, may adversely affect us.

We are subject to extensive regulation and supervision that govern almost all aspects of our operations. Intended to protect customers, depositors, consumers, deposit insurance funds and the stability of the U.S. financial system, these laws and regulations, among other matters, prescribe minimum capital requirements, impose limitations on our business activities, limit the dividend or distributions that we can pay, restrict the ability of institutions to guarantee our debt and impose certain specific accounting requirements that may be more restrictive and may result in greater or earlier charges to earnings or reductions in our capital than GAAP. Compliance with laws and regulations can be difficult and costly and changes to laws and regulations often impose additional compliance costs. We are currently facing increased regulation and supervision of our industry as a result of the financial crisis in the banking and financial markets. Such additional regulation and supervision may increase our

costs and limit our ability to pursue business opportunities. Further, our failure to comply with these laws and regulations, even if the failure was inadvertent or reflects a difference in interpretation, could subject us to restrictions on our business activities, fines and other penalties, any of which could adversely affect our results of operations, capital base and the price of our securities. Further, any new laws, rules and regulations could make compliance more difficult or expensive or otherwise adversely affect our business and financial condition.

We are periodically subject to examination and scrutiny by a number of banking agencies and, depending upon the findings and determinations of these agencies, we may be required to make adjustments to our business that could adversely affect us.

Federal and state banking agencies periodically conduct examinations of our business, including compliance with applicable laws and regulations. If, as a result of an examination, a federal banking agency were to determine that the financial condition, capital resources, asset quality, asset concentration, earnings prospects, management, liquidity sensitivity to market risk or other aspects of any of our operations has become unsatisfactory, or that we or our management is in violation of any law or regulation, it could take a number of different remedial actions as it deems appropriate. These actions include the power to enjoin “unsafe or unsound” practices, to require affirmative actions to correct any conditions resulting from any violation or practice, to issue an administrative order that can be judicially enforced, to direct an increase in our capital, to restrict our growth, to change the asset composition of our portfolio or balance sheet, to assess civil monetary penalties against our officers or directors, to remove officers and directors and, if it is concluded that such conditions cannot be corrected or there is an imminent risk of loss to depositors, to terminate our deposit insurance. If we become subject to such regulatory actions, our business, results of operations and reputation may be negatively impacted.

The enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 may have a material effect on our operations.

On July 21, 2010, President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act (which we refer to as the “Dodd-Frank Act”), which imposes significant regulatory and compliance changes. The key effects of the Dodd-Frank Act on our business are:

In addition, the Dodd-Frank Act restricts the ability of banks to engage in certain proprietary trading or to sponsor or invest in private equity or hedge funds. The Dodd-Frank Act also contains provisions designed to limit the ability of insured depository institutions, their holding companies and their affiliates to conduct certain swaps and derivatives activities and to take certain principal positions in financial instruments.

Some provisions of the Dodd-Frank Act became effective immediately upon its enactment. Many provisions, however, will require regulations to be promulgated by various federal agencies in order to be

implemented, some of which have been proposed by the applicable federal agencies. The provisions of the Dodd-Frank Act may have unintended effects, which will not be clear until implementation. The changes resulting from the Dodd-Frank Act may impact the profitability of our business activities, require changes to certain of our business practices, impose upon us more stringent capital, liquidity and leverage requirements or otherwise adversely affect our business. These changes may also require us to invest significant management attention and resources to evaluate and make any changes necessary to comply with new statutory and regulatory requirements. Failure to comply with the new requirements may negatively impact our results of operations and financial condition. While we cannot predict what effect any presently contemplated or future changes in the laws or regulations or their interpretations would have on us, these changes could be materially adverse to investors in our Class A common stock. For a more detailed description of the Dodd-Frank Act, see “Supervision and Regulation—Changes in Laws, Regulations or Policies and the Dodd-Frank Act.”

The short-term and long-term impact of the new regulatory capital standards and the forthcoming new capital rules is uncertain.

On September 12, 2010, the Group of Governors and Heads of Supervision, the oversight body of the Basel Committee on Banking Supervision, announced an agreement to a strengthened set of capital requirements for internationally active banking organizations in the United States and around the world, known as Basel III. Basel III increases the requirements for minimum common equity, minimum Tier 1 capital and minimum total capital, to be phased in over time until fully phased in by January 1, 2019.

Various provisions of the Dodd-Frank Act increase the capital requirements of bank holding companies, such as the Company, and non-bank financial companies that are supervised by the Federal Reserve. The leverage and risk-based capital ratios of these entities may not be lower than the leverage and risk-based capital ratios for insured depository institutions. In particular, bank holding companies, many of which have long relied on trust preferred securities as a component of their regulatory capital, will no longer be permitted to count trust preferred securities toward their Tier 1 capital. In June 2012, the Federal Reserve, OCC and FDIC released proposed rules which would implement the Basel III and Dodd-Frank Act capital requirements. While the Basel III changes and other regulatory capital requirements will likely result in generally higher regulatory capital standards, it is difficult at this time to predict how any new standards will ultimately be applied to us and our subsidiary bank.

The FDIC’s restoration plan and the related increased assessment rate could adversely affect our earnings.

The FDIC insures deposits at FDIC-insured depository institutions, such as our subsidiary bank, up to applicable limits. The amount of a particular institution’s deposit insurance assessment is based on that institution’s risk classification under an FDIC risk-based assessment system. An institution’s risk classification is assigned based on its capital levels and the level of supervisory concern the institution poses to its regulators. Market developments have significantly depleted the deposit insurance fund of the FDIC (which we refer to as the “DIF”) and reduced the ratio of reserves to insured deposits. As a result of recent economic conditions and the enactment of the Dodd-Frank Act, the FDIC has increased the deposit insurance assessment rates and thus raised deposit premiums for insured depository institutions. If these increases are insufficient for the DIF to meet its funding requirements, there may need to be further special assessments or increases in deposit insurance premiums. We are generally unable to control the amount of premiums that we are required to pay for FDIC insurance. If there are additional bank or financial institution failures, we may be required to pay even higher FDIC premiums than the recently increased levels. Any future additional assessments, increases or required prepayments in FDIC insurance premiums may materially adversely affect results of operations, including by reducing our profitability or limiting our ability to pursue certain business opportunities.

We are subject to federal and state and fair lending laws, and failure to comply with these laws could lead to material penalties.

Federal and state fair lending laws and regulations, such as the Equal Credit Opportunity Act and the Fair Housing Act, impose nondiscriminatory lending requirements on financial institutions. The Department of

Justice, Consumer Financial Protection Bureau and other federal and state agencies are responsible for enforcing these laws and regulations. Private parties may also have the ability to challenge an institution’s performance under fair lending laws in private class action litigation. A successful challenge to our performance under the fair lending laws and regulations could adversely impact our rating under the Community Reinvestment Act and result in a wide variety of sanctions, including the required payment of damages and civil money penalties, injunctive relief, imposition of restrictions on merger and acquisition activity and restrictions on expansion activity, which could negatively impact our reputation, business, financial condition and results of operations.

We face a risk of noncompliance and enforcement action with the Bank Secrecy Act and other anti-money laundering statutes and regulations.

The federal Bank Secrecy Act, the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (which we refer to as the “PATRIOT Act”) and other laws and regulations require financial institutions, among other duties, to institute and maintain effective anti-money laundering programs and file suspicious activity and currency transaction reports as appropriate. The federal Financial Crimes Enforcement Network, established by the U.S. Treasury Department to administer the Bank Secrecy Act, is authorized to impose significant civil money penalties for violations of those requirements and has recently engaged in coordinated enforcement efforts with the individual federal banking regulators, as well as the U.S. Department of Justice, Drug Enforcement Administration and Internal Revenue Service. There is also increased scrutiny of compliance with the rules enforced by the Office of Foreign Assets Control (which we refer to as “OFAC”). If our policies, procedures and systems are deemed deficient or the policies, procedures and systems of the financial institutions that we have already acquired or may acquire in the future are deficient, we would be subject to liability, including fines and regulatory actions such as restrictions on our ability to pay dividends and the necessity to obtain regulatory approvals to proceed with certain aspects of our business plan, including our acquisition plans, which would negatively impact our business, financial condition and results of operations. Failure to maintain and implement adequate programs to combat money laundering and terrorist financing could also have serious reputational consequences for us.

Federal, state and local consumer lending laws may restrict our ability to originate certain mortgage loans or increase our risk of liability with respect to such loans and could increase our cost of doing business.

Federal, state and local laws have been adopted that are intended to eliminate certain lending practices considered “predatory.” These laws prohibit practices such as steering borrowers away from more affordable products, selling unnecessary insurance to borrowers, repeatedly refinancing loans and making loans without a reasonable expectation that the borrowers will be able to repay the loans irrespective of the value of the underlying property. It is our policy not to make predatory loans, but these laws create the potential for liability with respect to our lending and loan investment activities. They increase our cost of doing business and, ultimately, may prevent us from making certain loans and cause us to reduce the average percentage rate or the points and fees on loans that we do make.

The Federal Reserve may require us to commit capital resources to support our subsidiary bank.

The Federal Reserve, which examines us and our subsidiaries, requires a bank holding company to act as a source of financial and managerial strength to a subsidiary bank and to commit resources to support such subsidiary bank. Under the “source of strength” doctrine, the Federal Reserve may require a bank holding company to make capital injections into a troubled subsidiary bank and may charge the bank holding company with engaging in unsafe and unsound practices for failure to commit resources to such a subsidiary bank. In addition, the Dodd-Frank Act directs the federal bank regulators to require that all companies that directly or indirectly control an insured depository institution serve as a source of strength for the institution. Under these requirements, in the future, we could be required to provide financial assistance to our subsidiary bank if it experiences financial distress.

A capital injection may be required at times when we do not have the resources to provide it, and therefore we may be required to borrow the funds. In the event of a bank holding company’s bankruptcy, the bankruptcy

trustee will assume any commitment by the holding company to a federal bank regulatory agency to maintain the capital of a subsidiary bank. Moreover, bankruptcy law provides that claims based on any such commitment will be entitled to a priority of payment over the claims of the holding company’s general unsecured creditors, including the holders of its note obligations. Thus, any borrowing that must be done by the holding company in order to make the required capital injection becomes more difficult and expensive and will adversely impact the holding company’s cash flows, financial condition, results of operations and prospects.

Stockholders may be deemed to be acting in concert or otherwise in control of Capital Bank, which could impose prior approval requirements and result in adverse regulatory consequences for such holders.

We are a bank holding company regulated by the Federal Reserve. Accordingly, acquisition of control of us (or our bank subsidiary) requires prior regulatory notice or approval. With certain limited exceptions, federal regulations prohibit potential investors from, directly or indirectly, acquiring ownership or control of, or the power to vote, more than 10% (more than 5% if the acquiror is a bank holding company) of any class of our voting securities, or obtaining the ability to control in any manner the election of a majority of directors or otherwise exercising a controlling influence over our management or policies, without prior notice or application to, and approval of, the Federal Reserve under the Change in Bank Control Act or the Bank Holding Company Act of 1956, as amended (which we refer to as the “BHCA”). Any bank holding company or foreign bank with a U.S. presence also is required to obtain the approval of the Federal Reserve under the BHCA to acquire or retain more than 5% of our outstanding voting securities.

In addition to regulatory approvals, any stockholder deemed to “control” us for purposes of the BHCA would become subject to investment and activity restrictions and ongoing regulation and supervision. Any entity owning 25% or more of any class of our voting securities, or a lesser percentage if such holder or group otherwise exercises a “controlling influence” over us, will be subject to regulation as a “bank holding company” in accordance with the BHCA. In addition, such a holder may be required to divest holdings of 5% or more of the voting securities of investments that may be deemed impermissible for a bank holding company, such as an investment in a company engaged in non-financial activities.

Regulatory determination of “control” of a depository institution or holding company is based on all of the relevant facts and circumstances. In certain instances, stockholders may be determined to be “acting in concert” and their shares aggregated for purposes of determining control for purposes of the Change in Bank Control Act. “Acting in concert” generally means knowing participation in a joint activity or parallel action towards the common goal of acquiring control of a bank or a parent company, whether or not pursuant to an express agreement. How this definition is applied in individual circumstances can vary among the various federal bank regulatory agencies and cannot always be predicted with certainty. Many factors can lead to a finding of acting in concert, including whether:

Our common stock owned by holders determined by a bank regulatory agency to be acting in concert would be aggregated for purposes of determining whether those holders have control of a bank or bank holding company for Change in Bank Control Act purposes. Because the control regulations under the Change in Bank Control Act and the BHCA are complex, potential investors should seek advice from qualified banking counsel before making an investment in our Class A common stock.

The market price of our Class A common stock could decline due to the large number of outstanding shares of our common stock eligible for future sale.

Sales of substantial amounts of our Class A common stock in the public market following the initial public offering or in future offerings, or the perception that these sales could occur, could cause the market price of our Class A common stock to decline. These sales could also make it more difficult for us to sell equity or equity-related securities in the future, at a time and place that we deem appropriate.

In addition, we intend to file a registration statement on Form S-8 under the Securities Act to register an aggregate of approximately 4.5 million shares of Class A common stock for issuance under our 2010 Equity Incentive Plan. Any shares issued in connection with acquisitions, the exercise of stock options or otherwise would dilute the percentage ownership held by investors who acquire our shares in the merger.

If shares of Class B non-voting common stock are converted into shares of Class A common stock, your voting power will be diluted.

Generally, holders of Class B non-voting common stock have no voting power and have no right to participate in any meeting of stockholders or to have notice thereof. However, holders of Class B non-voting common stock that are converted into Class A common stock will have all the voting rights of the other holders of Class A common stock. Class B non-voting common stock is not convertible in the hands of the initial holder. However, a transferee unaffiliated with the initial holder that receives Class B non-voting common stock subsequent to transfer permitted by our certificate of incorporation may elect to convert each share of Class B non-voting common stock into one share of Class A common stock. Upon conversion of any Class B non-voting common stock, your voting power will be diluted in proportion to the decrease in your ownership of the total outstanding Class A common stock.

The market price of our Class A common stock may be volatile, which could cause the value of an investment in our Class A common stock to decline.

The market price of our Class A common stock may fluctuate substantially due to a variety of factors, many of which are beyond our control, including:

The stock markets in general have experienced substantial volatility that has often been unrelated to the operating performance of particular companies. These types of broad market fluctuations may adversely affect the trading price of our Class A common stock. In the past, stockholders have sometimes instituted securities class action litigation against companies following periods of volatility in the market price of their securities. Any similar litigation against us could result in substantial costs, divert management’s attention and resources and harm our business or results of operations. For example, we are currently operating in, and have benefited from, a

protracted period of historically low interest rates that will not be sustained indefinitely, and future fluctuations in interest rates could cause an increase in volatility of the market price of our Class A common stock.

We do not currently intend to pay dividends on shares of our common stock in the foreseeable future after the merger and our ability to pay dividends will be subject to restrictions under applicable banking laws and regulations.

We do not currently intend to pay cash dividends on our common stock in the foreseeable future after the merger. The payment of cash dividends in the future will be dependent upon various factors, including our earnings, if any, cash balances, capital requirements and general financial condition. The payment of any dividends will be within the discretion of our then-existing Board of Directors. It is the present intention of our Board of Directors to retain all earnings, if any, for use in our business operations in the foreseeable future after the merger and, accordingly, our Board of Directors does not currently anticipate declaring any dividends. Because we do not expect to pay cash dividends on our common stock for some time, any gains on an investment in our Class A common stock issued in the merger will be limited to the appreciation, if any, of the market value of our Class A common stock.

Banks and bank holding companies are subject to certain regulatory restrictions on the payment of cash dividends. Federal bank regulatory agencies have the authority to prohibit bank holding companies from engaging in unsafe or unsound practices in conducting their business. The payment of dividends by us depending on our financial condition could be deemed an unsafe or unsound practice. Our ability to pay dividends will directly depend on the ability of our subsidiary bank to pay dividends to us, which in turn will be restricted by the requirement that it maintains an adequate level of capital in accordance with requirements of its regulators and, in the future, can be expected to be further influenced by regulatory policies and capital guidelines. In addition, on August 24, 2010, Capital Bank entered into the OCC Operating Agreement, which in certain circumstances will restrict Capital Bank’s ability to pay dividends to us, to make changes to its capital structure and to make certain other business decisions. See “Historical Market Prices and Dividend Information.”

Certain provisions of our certificate of incorporation and the loss sharing agreements may have anti-takeover effects, which could limit the price investors might be willing to pay in the future for our common stock and could entrench management. In addition, Delaware law may inhibit takeovers of us and could limit our ability to engage in certain strategic transactions our Board of Directors believes would be in the best interests of stockholders.

Our certificate of incorporation contains provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests. These provisions include the ability of our Board of Directors to designate the terms of and issue new series of preferred stock, which may make the removal of management more difficult and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities, including our Class A common stock. See “Description of Capital Stock.”

Our loss sharing agreements with the FDIC require that we receive prior FDIC consent, which may be withheld by the FDIC in its sole discretion, prior to us or our stockholders engaging in certain transactions. If any such transaction is completed without prior FDIC consent, the FDIC would have the right to discontinue the relevant loss sharing arrangement. Among other things, prior FDIC consent is required for (1) a merger or consolidation of us or our bank subsidiary with or into another company if our stockholders will own less than 66.66% of the combined company, (2) the sale of all or substantially all of the assets of any of our bank subsidiary and (3) a sale of shares by a stockholder, or a group of related stockholders, that will effect a change in control of Capital Bank, as determined by the FDIC with reference to the standards set forth in the Change in Bank Control Act (generally, the acquisition of between 10% and 25% of any class of our voting securities where the presumption of control is not rebutted, or the acquisition by any person, acting directly or indirectly or through or in concert with one or more persons, of 25% or more of any class of our voting securities). If we or

any stockholder desired to enter into any such transaction, the FDIC may not grant its consent in a timely manner, without conditions, or at all. If one of these transactions were to occur without prior FDIC consent and the FDIC withdrew its loss share protection, there could be a material adverse effect on our financial condition, results of operations and cash flows. In addition, statutes, regulations and policies that govern bank holding companies, including the BHCA, may restrict our ability to enter into certain transactions. See “Supervision and Regulation.”

We are also subject to anti-takeover provisions under Delaware law. We have not opted out of Section 203 of the Delaware General Corporation Law (which we refer to as the “DGCL”), which, subject to certain exceptions, prohibits a public Delaware corporation from engaging in a business combination (as defined in such section) with an “interested stockholder” (defined generally as any person who beneficially owns 15% or more of the outstanding voting stock of such corporation or any person affiliated with such person) for a period of three years following the time that such stockholder became an interested stockholder, unless (1) prior to such time the board of directors of such corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; (2) upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of such corporation at the time the transaction commenced (excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the interested stockholder) the voting stock owned by directors who are also officers or held in employee benefit plans in which the employees do not have a confidential right to tender or vote stock held by the plan); or (3) on or subsequent to such time the business combination is approved by the board of directors of such corporation and authorized at a meeting of stockholders by the affirmative vote of at least two-thirds of the outstanding voting stock of such corporation not owned by the interested stockholder.

This document contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. Accordingly, these statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed in them. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of several factors more fully described under the caption “Risk Factors” and elsewhere in this document, including the appendices hereto.

Any or all of our forward-looking statements in this document may turn out to be inaccurate. The inclusion of this forward-looking information should not be regarded as a representation by us, TIB Financial or any other person that the future plans, estimates or expectations contemplated by us or TIB Financial will be achieved. We and TIB Financial have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements including, but not limited to, statements regarding:

All forward-looking statements are necessarily only estimates of future results, and actual results may differ materially from expectations. You are, therefore, cautioned not to place undue reliance on such statements which should be read in conjunction with the other cautionary statements that are included elsewhere in this document. In particular, you should consider the numerous risks described in the “Risk Factors” section of this document. Further, any forward-looking statement speaks only as of the date on which it is made and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. You should, however, review the risk factors we describe in the reports we will file from time to time with the SEC after the date of this prospectus. See “Additional Information.”

The following discussion contains material information pertaining to the merger. This discussion is subject, and qualified in its entirety by reference, to the plan of merger attached as Appendix A to this document. We encourage you to read carefully this entire document, including the plan of merger included as Appendix A, for a more complete understanding of the merger.

Our Board of Directors has approved and adopted the plan of merger. The plan of merger provides for the merger of TIB Financial with and into CBF (formerly known as North American Financial Holdings, Inc.), with CBF continuing as the surviving entity. In the merger, each share of TIB Financial common stock issued and outstanding immediately prior to the completion of the merger, except for shares for which appraisal rights are properly exercised and certain shares held by CBF or TIB Financial, will be converted into the right to receive 0.7205 of a share of CBF Class A common stock. No fractional shares of Class A common stock will be issued in connection with the merger, and holders of TIB Financial common stock will be entitled to receive cash in lieu thereof.

Since we currently own more than 90% of common stock of TIB Financial, under Delaware and Florida law, no vote of our stockholders, TIB Financial’s shareholders or TIB Financial’s Board of Directors is required to complete the merger. We expect to complete the merger substantially concurrent with the completion of our initial public offering. We currently anticipate the completion of the merger to occur in the second half of 2012. While the plan of merger does not contain conditions to the completion of the merger, the timing of the merger may change based on the timing of our initial public offering and the timing of our planned mergers with our other bank holding company subsidiaries, which are part of the reorganization. We may choose to complete the merger even if we do not complete our initial public offering.

Since raising approximately $900 million in December 2009 and January and July 2010, we have pursued acquisition opportunities consistent with our business strategy that we believe will produce attractive returns for our stockholders.

In the third quarter of 2010, our management team commenced discussions with the management of TIB Financial regarding a proposed investment by CBF in newly issued capital stock of TIB Financial. We approached TIB Financial because it offered us an opportunity to expand our geographic reach in Florida to include markets that we believed had particularly attractive customer characteristics and provided a platform to support our future growth. On June 8, 2010, we entered into a confidentiality agreement with TIB Financial. Over the next several weeks, we conducted due diligence on TIB Financial and continued negotiations with TIB Financial’s management and advisors.

On June 29, 2010, we entered into an Investment Agreement (which we refer to as the “Investment Agreement”) with TIB Financial and its wholly owned subsidiary, TIB Bank. The description of the Investment Agreement that follows in this document has been adjusted for the effect of a 1 for 100 reverse stock split completed by TIB Financial on December 15, 2010. The Investment Agreement provided for TIB Financial to sell to CBF (1) 7,000,000 shares of TIB Financial’s common stock at $15.00 per share, (2) 70,000 shares of mandatorily convertible participating voting preferred stock for $1,000 per share and (3) a warrant to purchase (which we refer to as the “TIB Warrant”), during the 18-month period following the closing of purchase of the common and preferred stock referred to in items (1) and (2), up to 11,666,667 shares of TIB Financial’s common stock at $15.00 per share. Our consideration was comprised of approximately $162.8 million in cash and approximately $12.2 million in the form of a contribution to TIB Financial of all 37,000 outstanding shares of Series A Preferred Stock previously issued to the United States Department of the Treasury under the TARP

Capital Purchase Program and the related warrant to purchase shares of TIB Financial’s common stock, which we purchased directly from the Treasury. Following receipt of shareholder approval of an amendment to TIB Financial’s articles of incorporation to increase the number of authorized shares of common stock, the preferred stock issued at the closing would mandatorily convert into shares of TIB Financial common stock equal to the $70.0 million purchase price divided by $15.00 per share, subject to anti-dilution adjustments. In connection with the Investment Agreement, TIB Financial also agreed to provide us with customary registration rights for our shares of TIB Financial common stock.

On September 30, 2010, after having received the required regulatory and other approvals, we consummated the purchase of the shares of TIB Financial common stock, preferred stock and TIB Warrant contemplated by the Investment Agreement for aggregate consideration of $175.0 million. In connection with the TIB Financial investment, our Chief Executive Officer, R. Eugene Taylor, our Chief Financial Officer, Christopher G. Marshall, our Chief Risk Officer, R. Bruce Singletary, and two of our outside Directors, Peter N. Foss and William A. Hodges, were each appointed to the board of directors of TIB Financial. Two existing members of the TIB Financial board, Howard Gutman and Brad Boaz, remained on the TIB Financial board. All other members of the board of directors of TIB Financial resigned effective September 30, 2010.

On December 1, 2010, at a special meeting of TIB Financial shareholders, shareholders approved an amendment to TIB Financial’s articles of incorporation to increase the number of authorized shares of common stock. As a result of this amendment, which was implemented on December 1, 2010, the 70,000 shares of TIB Financial preferred stock owned by CBF automatically converted into 4,666,666 shares of TIB Financial common stock.

After the conversion of our shares of TIB Financial preferred stock and prior to January 18, 2011, we owned approximately 99% of TIB Financial’s common stock. Under the terms of the Investment Agreement, TIB Financial conducted a rights offering to its shareholders as of July 12, 2010 in which shareholders were able to purchase shares of TIB Financial common stock at the same price that we received under the Investment Agreement, subject to certain limitations. Approximately 533,029 shares of the TIB Financial’s common stock were issued in exchange for approximately $7.8 million upon completion of the rights offering on January 18, 2011. As a result of this rights offering, our ownership interest in TIB Financial was reduced to approximately 94%.

Following the completion of our investment in TIB Financial, we worked to integrate TIB Financial’s management, policies and systems with those of our existing operations. We completed this integration process approximately six months after completing our investment in TIB Financial. In addition, we worked to integrate the legal entities through which CBF conducted its banking operations.

As a result of our acquisition of the Failed Banks and our investments in TIB Financial, Capital Bank Corp. and Green Bankshares, we have a majority interest in three public bank holding companies, each of which also has a portion of its shares owned by the public. In addition, prior to April 29, 2011, we held controlling interests in three banks: a 100% direct interest in NAFH National Bank and indirect controlling interests in TIB Bank, and Capital Bank Corp.’s banking subsidiary, Capital Bank (which we refer to as “Old Capital Bank”).

Beginning in December 2010, our management began discussions, in conjunction with its advisors, concerning the optimal corporate structure for CBF. In February 2011, after discussions with our management and outside advisors, our Board of Directors determined that it would be advisable for us to explore (1) combining Old Capital Bank and NAFH National Bank, (2) combining Capital Bank Corp. and CBF, (3) combining TIB Bank and NAFH National Bank and (4) combining TIB Financial and CBF.

In April 2011, our Board of Directors and NAFH National Bank’s Board of Directors each met and authorized management to combine TIB Bank with NAFH National Bank in an all-stock transaction with an

exchange ratio based on the relative tangible book values per share of TIB Bank and NAFH National Bank. Also in April 2011, the Board of Directors of TIB Financial and TIB Bank, including all of the members of the TIB Financial and TIB Bank Boards of Directors that are not also members of our Board of Directors, met and approved the combination of TIB Bank with NAFH National Bank in an all-stock transaction with an exchange ratio based on the relative tangible book values per share of TIB Bank and NAFH National Bank.

On April 27, 2011, TIB Bank and NAFH National Bank entered into a merger agreement, and on April 29, 2011, after receiving required regulatory approval, TIB Bank merged with and into NAFH National Bank. In the merger, each share of TIB Bank common stock was converted into the right to receive shares of NAFH National Bank common stock. Following the merger, TIB Financial owned approximately 53% of NAFH National Bank and CBF directly owned the remaining 47%.

In June 2011, our Board of Directors and NAFH National Bank’s Board of Directors each met and authorized management to combine Old Capital Bank with NAFH National Bank in an all-stock transaction, also with an exchange ratio based on the relative tangible book values per share of Old Capital Bank and NAFH National Bank. Also in June 2011, the Boards of Directors of Capital Bank Corp. and Old Capital Bank, including all of the members of the Capital Bank Corp. Board of Directors and Old Capital Bank Board of Directors that are not also members of our Board of Directors, met and approved the combination of Old Capital Bank with NAFH National Bank in an all-stock transaction with an exchange ratio based on the relative tangible book values per share of Old Capital Bank and NAFH National Bank.

On June 30, 2011, after receiving required regulatory approvals, Old Capital Bank and NAFH National Bank entered into a merger agreement and on the same day Old Capital Bank merged with and into NAFH National Bank. In the merger, each share of Old Capital Bank common stock was converted into the right to receive shares of NAFH National Bank common stock. Following the merger, Capital Bank Corp. owned approximately 38% of NAFH National Bank, CBF directly owned approximately 29% of NAFH National Bank and TIB Financial owned the remaining approximately 33%. In connection with the merger, NAFH National Bank changed its name to Capital Bank, National Association.

As a result of the discussions referred to above regarding CBF’s optimal corporate structure, the Investment Agreement with Green Bankshares contemplated that GreenBank would be merged with and into Capital Bank within three business days of the completion of the Investment. Prior to CBF’s completion of the Investment, the Board of Directors and shareholders of Green Bankshares approved the merger of GreenBank with and into Capital Bank in an all-stock transaction with an exchange ratio equal to the ratio of the tangible book value of GreenBank to the tangible book value of Capital Bank.

On September 7, 2011, after receiving required regulatory approvals and immediately after the completion of the Investment, GreenBank and Capital Bank entered into a merger agreement and GreenBank subsequently merged with and into Capital Bank. In the merger, each share of GreenBank common stock was converted into the right to receive shares of Capital Bank common stock. Following the merger, Green Bankshares owned approximately 34% of Capital Bank, CBF directly owned approximately 19% of Capital Bank, TIB Financial owned approximately 21% of Capital Bank and Capital Bank Corp. owned approximately 26% of Capital Bank.

Following the consolidation of CBF’s banking subsidiaries into a single legal entity, CBF, TIB Financial and Capital Bank worked to integrate the legal entities that directly and indirectly held interests in Capital Bank, N.A.

On September 1, 2011, the Boards of Directors of CBF and Capital Bank Corp. adopted resolutions pursuant to which Capital Bank Corp. would be merged with and into CBF. The exchange ratio in that merger was selected was based on the relative tangible book values per share of CBF and Capital Bank Corp. as of June 30, 2011, after giving pro forma effect to CBF’s acquisition of Green Bankshares.

On September 1, 2011, our Board of Directors met and adopted the plan of merger providing for the merger of TIB Financial with and into CBF in a short-form merger without the approval of TIB Financial’s shareholders as permitted by Florida law. The exchange ratio selected was based on the relative tangible book values per share of CBF and TIB Financial as of June 30, 2011, after giving pro forma effect to CBF’s acquisition of Green Bankshares.

On September 1, 2011, the Board of Directors of TIB Financial, including all of the members of the TIB Financial Board of Directors that are not also members of our Board of Directors, met and approved and ratified the plan of merger providing for the merger of TIB Financial with and into CBF with an exchange ratio based on the relative tangible book values per share of CBF and TIB Financial as of June 30, 2011, after giving pro forma effect to CBF’s acquisition of Green Bankshares. At such meeting, the Board of Directors of TIB Financial considered the opinion of Sterne Agee to the effect that, as of the date of the opinion, the exchange ratio was fair to the shareholders of TIB Financial from a financial point of view.

On September 8, 2011, our Board of Directors adopted resolutions pursuant to which Green Bankshares would be merged with and into CBF in a short-form merger without the approval of Green Bankshares’ shareholders, as permitted by Tennessee law. The exchange ratio in that merger is based on the pro forma relative tangible book values per share of CBF and Green Bankshares as of June 30, 2011.

In reaching its decision to adopt and approve the merger, our Board of Directors consulted with management and considered a number of factors, including:

In reaching its decision to approve the merger, the TIB Financial Board of Directors consulted with management and considered both of the factors described above and also considered the fact that the merger will result in TIB Financial shareholders holding shares in CBF, which is expected to have a significantly larger market capitalization and substantially greater trading volume in its stock following the merger than TIB Financial had prior to the merger. The TIB Financial Board of Directors also relied on the experience of Sterne Agee for analyses of the financial terms of the merger and for its opinion as to the fairness, from a financial point of view, of the consideration in the merger to TIB Financial.

The foregoing discussion of the factors considered by our Board of Directors and the TIB Financial Board of Directors is not intended to be exhaustive, but rather includes the material factors considered by our Board of Directors and the TIB Financial Board of Directors. In reaching their respective decisions to approve the merger, neither Board of Directors quantified or assigned any relative weights to the factors considered, and individual directors may have given different weights to different factors. Each Board of Directors considered all these factors as a whole, including discussions with, and questioning of, management, and overall considered the factors to be favorable to, and to support, its determination.

In setting the exchange ratio, our financial interest was adverse to the interests of the public stockholders of TIB Financial. We determined the exchange ratio without negotiating with TIB Financial and make no representation or warranty in this document as to the fairness or adequacy of the consideration to be paid in the

merger. Under Florida law, which applies to the merger, you have the right to seek appraisal of your TIB Financial shares as provided for under such law. See “—Appraisal Rights” for a description of the appraisal process.

By letter dated August 30, 2011, TIB Financial retained Sterne, Agee & Leach, Inc. to render an opinion to TIB Financial in connection with the merger of TIB Financial with and into CBF, pursuant to the plan of merger. As set forth more fully in the plan of merger, as a result of the merger, each share of common stock, par value $0.10 per share, of TIB Financial (other than shares for which appraisal rights are properly exercised and certain shares held by CBF or TIB Financial) will be converted into the right to receive 0.7205 shares (which we refer to as the “Exchange Ratio”), par value $0.01 per share, of CBF Class A common stock. TIB Financial’s Board of Directors retained Sterne Agee as a financial advisor because Sterne Agee is a nationally recognized investment banking firm with substantial expertise in transactions similar to the proposed transaction, and because it was familiar with CBF, TIB Financial and Capital Bank Corp. and their respective businesses due to Sterne Agee’s prior engagements by TIB Financial and Capital Bank Corp. during the spring and summer of 2011, respectively, regarding the mergers of TIB Financial’s and Capital Bank Corp.’s subsidiary banks into Capital Bank. Sterne Agee, as part of its investment banking business, is regularly involved in the valuation of businesses and their securities in connection with mergers and acquisitions and other corporate transactions. Sterne Agee did not act as financial advisor to any of CBF, TIB Financial, Capital Bank Corp. or Green Bankshares in connection with, and has not participated in the negotiations leading to, the merger, the Green Bankshares Investment or the Other Transactions (both as defined below).

On August 31, 2011, Sterne Agee delivered its written opinion to TIB Financial’s board of directors that, as of such date, and based upon and subject to factors and assumptions set forth therein, the Exchange Ratio was fair, from a financial point of view, to the shareholders of TIB Financial. The full text of Sterne Agee’s written opinion, dated August 31, 2011, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken, in connection with the opinion, is attached as Appendix B to this document and is incorporated herein by reference. The description of the opinion set forth herein is qualified in its entirety by reference to the full text of the opinion. TIB Financial’s shareholders are urged to read the entire opinion carefully in connection with their consideration of the proposed merger.

In conducting its review and arriving at its opinion, Sterne Agee relied upon and assumed, with the consent of the TIB Financial board of directors, and without assuming any responsibility for independent verification, the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by it. Where it deemed appropriate, Sterne Agee also relied upon publicly available information, without independent verification, that it believed to be reliable, accurate and complete, but it did not guarantee the reliability, accuracy or completeness of any such publicly available information. With respect to the pro forma information supplied to it, Sterne Agee assumed, with the consent of the TIB Financial board of directors, that such information was reasonably prepared on the basis reflecting the best currently available estimates and judgments of CBF and its affiliates. In rendering its opinion, Sterne Agee expressed no view as to the reasonableness of such information or the assumptions on which it was based. Sterne Agee also relied upon the materials provided to it, and its studies, analyses and investigations, in connection with its previous engagement by the TIB Financial board of directors in April 2011 with respect to the merger of TIB Bank with and into NAFH National Bank.

For the purposes of rendering its opinion, Sterne Agee also assumed, with the consent of the TIB Financial board of directors, that (i) the plan of merger was a duly adopted and valid plan of merger under applicable state law and will not be terminated by CBF; (ii) there had been no material changes in the assets, liabilities, financial condition, results of operations, business or prospects of CBF, TIB Financial, Capital Bank Corp. or Green Bankshares and their respective affiliates since either (1) the date of the last financial statements made available to it and (2) the dates of the drafts of the plan of merger and the Other Agreements reviewed by it; (iii) no legal, political, economic, regulatory or other developments have occurred that will adversely affect these entities; (iv) all required governmental, regulatory, shareholder and third-party approvals had or will be received in a timely fashion and without any conditions or requirements that could adversely affect the merger; and (v) the Green Bankshares Investment and the subsequent merger of GreenBank with and into Capital Bank, N.A. would be completed prior to the consummation of the merger.

Sterne Agee is not a legal, regulatory, tax or accounting expert and relied on the assessments made by CBF, its affiliates and their respective advisors with respect to such issues. Sterne Agee did not make an independent evaluation of the assets or liabilities of CBF, TIB Financial, Capital Bank Corp. or Green Bankshares or their respective affiliates, including, but not limited to, any derivative or off-balance sheet assets or liabilities.

The Sterne Agee opinion is limited to the fairness, from a financial point of view, of the Exchange Ratio, is subject to the assumptions, limitations, qualifications and other conditions contained therein, was necessarily based on economic, market and other conditions as existed on, and could be evaluated as of, the date of the opinion and on the information made available to it as of the date of the opinion. Sterne Agee expressly disclaimed any obligation to update, revise or reaffirm its opinion based on events and developments occurring after the date of its opinion.

Except as expressly stated therein, the Sterne Agee opinion does not address the fairness of the merger, or any consideration received in connection therewith, to the holders of any class of securities, creditors or other constituencies of TIB Financial, nor does it address the fairness of the contemplated benefits of the merger. The Sterne Agee opinion does not address the merits of the underlying business decision of TIB Financial to engage in the merger or the relative merits of the merger as compared to any strategic alternatives that may be available to TIB Financial. In addition, Sterne Agee did not express any view or opinion with respect to the fairness, financial or otherwise, of the amount or nature or any other aspect of any compensation payable to or to be received by any officers, directors or employees of any parties to the merger relative to the Exchange Ratio.

The Sterne Agee opinion was approved and authorized for issuance by a fairness opinion committee and was addressed to, and provided solely and exclusively for the information and assistance of the board of directors of TIB Financial in connection with its consideration of the Exchange Ratio.

The following is a summary of the material financial analyses contained in the presentation delivered by Sterne Agee to the TIB Financial board of directors and that were used by Sterne Agee in connection with rendering its opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Sterne Agee, nor does the order in which the analyses are described represent the relative importance or weight given to the analyses by Sterne Agee. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Sterne Agee’s financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on financial information, is based on information as it existed on June 30, 2011, and is not necessarily indicative of the current financial condition of each company.

Sterne Agee reviewed and compared the following financial information for CBF, TIB Financial, Capital Bank Corp. and Green Bankshares:

Using this financial information, Sterne Agee calculated an exchange ratio of 0.7205x for the merger using the tangible book value per share of TIB Financial as of June 30, 2011 and the pro forma tangible book value per share of CBF as of June 30, 2011. Based on its experience and expertise, Sterne Agee concluded that tangible book value was the appropriate valuation metric in the current environment for depository institutions to use in determining the exchange ratio.

Sterne Agee also calculated the pro forma ownership of CBF, assuming consummation of the Green Bankshares Investment, the merger and the Other Transactions. The percentage of total equity, after adjusting for CBF’s ownership position, is equal to the pro forma ownership based on the exchange ratios.

Sterne Agee reviewed and analyzed the June 30, 2011 balance sheet of TIB Financial and made the following observations:

Based on its review and analysis, Sterne Agee concluded that no other assets or liabilities of TIB Financial existed as of June 30, 2011 that would materially impact the Exchange Ratio.

In performing its analyses, Sterne Agee also took into account the following factors:

Under the engagement letter between TIB Financial and Sterne Agee, TIB Financial agreed to pay Sterne Agee a fee of $50,000 upon delivery of the written fairness opinion. No portion of Sterne Agee’s fee is contingent upon either the conclusion expressed in Sterne Agee’s opinion or whether or not the merger is successfully consummated. Pursuant to the engagement letter, TIB Financial agreed to reimburse Sterne Agee for reasonable, documented out-of-pocket expenses, including any fees and expenses of Sterne Agee’s legal counsel, incurred in connection with the engagement and to indemnify Sterne Agee and related parties against certain liabilities, including liabilities under federal securities laws, relating to, or arising out of, its engagement. In 2011, Sterne Agee was also engaged to deliver fairness opinions, and received a fee upon delivery of such opinions, by (i) the Capital Bank Corp. board of directors and the Green Bankshares board of directors with respect to the Other Transactions for which Sterne Agee received $50,000 for each opinion, (ii) the Capital Bank Corp. board of directors with respect to the merger of Capital Bank with and into NAFH National Bank, for which Sterne Agee received $50,000, and (iii) the TIB Financial board of directors with respect to the merger of TIB Bank with and into NAFH National Bank, for which Sterne Agee received $50,000. Other than the engagements described in the preceding sentence, Sterne Agee has not provided investment banking services to any of CBF, TIB Financial, Capital Bank Corp. or Green Bankshares or their respective affiliates during the past two years; however, Sterne Agee may do so in the future.

Pursuant to Section 607.1302 of the FBCA, as a TIB Financial shareholder, if you do not wish to accept the merger consideration to be received pursuant to the terms of the plan of merger, you may exercise appraisal rights and, if the merger is consummated, obtain the payment of the “fair value” of your shares of TIB Financial common stock (as valued immediately prior to the completion of the merger in accordance with Florida law). Such fair value is exclusive of any appreciation or depreciation in anticipation of the merger, unless such exclusion would be inequitable to TIB Financial and its remaining shareholders. You should note that the investment banking opinion as to the fairness, from a financial point of view, of the consideration payable in the merger, is not an opinion as to, and do not otherwise address, fair value under the FBCA.

In order to exercise appraisal rights, you must strictly comply with the statutory procedures of Sections 607.1301 through 607.1333 of the FBCA, which are summarized below. A copy of the full text of those sections is included as Appendix C to this document. We urge you are to read Appendix C in its entirety and to consult with your legal adviser. If you fail to adhere strictly to the requirements of Florida law in any regard, your appraisal rights will be forfeited.

The following summary of Florida law is qualified in its entirety by reference to the full text of the applicable provisions of the FBCA included as Appendix C to this document.

Within 10 days after the completion of the merger, we must supply to each TIB Financial shareholder a written appraisal notice and an appraisal election form that specifies, among other things:

The form must also contain our offer to pay to the TIB Financial shareholder the amount that we have estimated as the fair value of the shares of TIB Financial common stock, and request certain information from the shareholder, including:

The form will also be accompanied by certain financial statements of TIB Financial and a copy of Sections 607.1301 through 607.1333 of the FBCA.

A TIB Financial shareholder exercising appraisal rights must execute and return the appraisal election form in accordance with the instructions provided therein and, in the case of certificated shares, deposit the shareholder’s certificates in accordance with the terms of the notice by the date referred to therein. Once a shareholder deposits that shareholder’s certificates or, in the case of uncertificated shares, returns the executed forms, that shareholder loses all rights as a TIB Financial shareholder, unless the shareholder properly withdraws from the appraisal process by giving written notice to us within the time period specified in the appraisal election form. Any such shareholder failing to return a properly completed appraisal election form and, in the case of certificated shares, deposit the shareholder’s certificates, within the period stated in the form, will lose such shareholder’s appraisal rights and be bound by the terms of the plan of merger.

Upon returning the appraisal election form, a shareholder shall be entitled only to payment pursuant to the procedure set forth in the applicable sections of the FBCA and shall not be entitled to vote or to exercise any other rights of a shareholder unless the shareholder withdraws such shareholder’s demand for appraisal within the time period specified in the appraisal election form.

A shareholder who has delivered the appraisal election form and, in the case of certificated shares, such shareholder’s stock certificates may decline to exercise appraisal rights and withdraw from the appraisal process by giving written notice to us within the time period specified in the appraisal election form. Thereafter, a shareholder may not withdraw from the appraisal process without our written consent. Upon a withdrawal, the right of the shareholder to be paid the fair value of such shareholder’s shares will cease, and the shareholder will be reinstated as a CBF stockholder.

If the shareholder accepts our offer in the appraisal election form to pay our estimate of the fair value of the shares of TIB Financial common stock, payment for the shares of the shareholder is to be made within 90 days after the receipt of the appraisal election form by us or our agent. Upon payment of the agreed value, the shareholder will cease to have any interest in such shares.

A shareholder must assert appraisal rights with respect to all of the shares registered in such shareholder’s name, except that a record shareholder may assert appraisal rights as to fewer than all of the shares registered in the record shareholder’s name but which are owned by a beneficial shareholder, if the record shareholder objects with respect to all shares owned by the beneficial shareholder. A record shareholder must notify us in writing of the name and address of each beneficial shareholder on whose behalf appraisal rights are being asserted. A beneficial shareholder may assert appraisal rights as to any shares held on behalf of the shareholder only if the shareholder submits to us the record shareholder’s written consent to the assertion of such rights before the date specified in the appraisal notice, and does so with respect to all shares that are beneficially owned by the beneficial shareholder.

Sections 607.1326 and 607.1330 of the FBCA address what should occur if a shareholder fails to accept our offer to pay the value of the shares as estimated by us and we fail to comply with the demand of the shareholder to pay the value of the shares as estimated by the shareholder, plus interest.

If a shareholder refuses to accept our offer to pay the value of the shares as estimated by us and we fail to comply with the demand of the shareholder to pay the value of the shares as estimated by the shareholder, plus interest, then within 60 days after receipt of a written demand from any dissenting shareholder given within 60 days after the date on which the merger was effected, we shall, or at our election at any time within such period of 60 days may, file an action requesting that the fair value of such shares be determined by the court.

If we fail to institute a proceeding within the above-prescribed period, any shareholder that has made a demand under Section 607.1326 of the FBCA may do so in our name. A copy of the initial pleading will be served on each shareholder who has made such a demand. We are required to pay each shareholder the amount found to be due within 10 days after final determination of the proceedings, which amount may, in the discretion of the court, include a fair rate of interest, which will also be determined by the court. Upon payment of the judgment, the shareholder ceases to have any interest in such shares.

Section 607.1331 of the FBCA provides that the costs of a court appraisal proceeding, including reasonable compensation for, and expenses of, appraisers appointed by the court, shall be determined by the court and assessed against us, except that the court may assess costs against all or some of the shareholders demanding appraisal, in amounts the court finds equitable, to the extent that the court finds such shareholders acted arbitrarily, vexatiously or not in good faith with respect to their appraisal rights. The court also may assess the fees and expenses of counsel and experts for the respective parties, in amounts the court finds equitable, against (1) us and in favor of any or all shareholders if the court finds we did not substantially comply with the notification provisions set forth in Sections 607.1320 and 607.1322, or (2) either us or the shareholder, in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously, or not in good faith with respect to the appraisal rights. If the court in an appraisal proceeding finds that the services of counsel for any shareholder were of substantial benefit to other shareholders, and that the fees for those services should not be assessed against us, the court may award to such counsel reasonable fees to be paid out of the amounts awarded the shareholders who were benefited. To the

extent that we fail to make a required payment when a shareholder accepts our offer to pay the value of the shares as estimated by us, the shareholder may sue directly for the amount owed and, to the extent successful, shall be entitled to recover from us all costs and expenses of the suit, including counsel fees.

Any shareholder who perfects such shareholder’s right to be paid the fair value of the shareholder’s shares will recognize gain or loss, if any, for federal income tax purposes upon the receipt of cash for such shares. The amount of gain or loss and its character as ordinary or capital gain or loss will be determined in accordance with applicable provisions of the Code. See “Material U.S. Federal Income Tax Consequences Of the Merger.”

In view of the complexity of the provisions of the Florida law relating to appraisal rights and the requirement that they be strictly complied with, TIB Financial shareholders who are considering exercising appraisal rights are urged to read carefully the information in Appendix C and to consult their own legal advisers before electing or attempting to exercise these rights.

The merger is not subject to the requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules promulgated under that Act by the Federal Trade Commission, which prevent some transactions from being completed until required information and materials are furnished to the Antitrust Division of the U.S. Department of Justice and the U.S. Federal Trade Commission and the waiting periods end or expire. We are not aware of any material regulatory requirements applicable to the merger under any U.S. state or federal law or regulation, other than any requirements under applicable federal and state securities laws and regulations and Florida and Delaware corporate law.

The merger will be accounted for as a “purchase” of a noncontrolling interest, as such term is used under generally accepted accounting principles, for accounting and financial reporting purposes. Accordingly, CBF’s noncontrolling interest will be reclassified to additional paid in capital.

The following describes the material provisions of the plan of merger. The following description of the plan of merger is subject, and qualified in its entirety by reference, to the plan of merger, which is attached to this document as Appendix A and is incorporated by reference into this document. We urge you to read the plan of merger carefully and in its entirety, as it is the legal document governing the merger.

Our Board of Directors has approved the plan of merger, which provides for the merger of TIB Financial with and into CBF (formerly known as North American Financial Holdings, Inc.). CBF will be the surviving entity in the merger.

Each share of TIB Financial common stock issued and outstanding immediately prior to the completion of the merger, except for shares for which appraisal rights are properly exercised and except for specified shares of TIB Financial common stock held by CBF or TIB Financial, will be converted into the right to receive 0.7205 of a share of CBF Class A common stock.

We will not issue any fractional shares of our Class A common stock in the merger. Instead, a TIB Financial shareholder who otherwise would have received a fraction of a share of our Class A common stock will receive an amount in cash rounded to the nearest cent. This cash amount will be determined by multiplying the fraction of a share of our Class A common stock to which the holder would otherwise be entitled by the average of the closing sale prices of our Class A common stock on Nasdaq for the three trading days immediately following the date on which the merger is completed.

At the effective time of the merger, our certificate of incorporation and bylaws in effect immediately prior to the effective time will be the certificate of incorporation and bylaws of CBF as the surviving corporation after completion of the merger until thereafter amended in accordance with their respective terms and applicable law. At the effective time of the merger, our Board of Directors immediately prior to the effective time of the merger will be the board of directors of CBF as the surviving corporation of the merger.

At the effective time of the merger, each outstanding option to acquire TIB Financial common stock granted under TIB Financial’s stock incentive plan will be converted automatically into an option to purchase a number of shares of our Class A common stock equal to the product (rounded down to the nearest whole share) of (1) the number of shares of TIB Financial common stock subject to the option and (2) the exchange ratio of 0.7205. Each converted stock option will be subject to the same terms and conditions (including expiration date, vesting and exercise provisions) as were applicable immediately prior to the effective time of the merger. The per share exercise price for each converted stock option will equal the quotient (rounded up to the nearest whole cent) of (x) the per share exercise price of the option in effect immediately prior to the effective time of the merger and (y) the exchange ratio of 0.7205.

At the effective time of the merger, the TIB Warrant will automatically be canceled and will cease to exist, for no additional consideration. As of March 31, 2012, the TIB Warrant expired unexercised.

The conversion of TIB Financial common stock into the right to receive merger consideration will occur automatically at the effective time of the merger. As soon as reasonably practicable after completion of the merger, the exchange agent will exchange certificates or direct registration statements representing or evidencing shares of TIB Financial common stock for the merger consideration to be received pursuant to the terms of the plan of merger. American Stock Transfer & Trust Company, LLC will be the exchange agent.

As soon as reasonably practicable after the completion of the merger, the exchange agent will mail a letter of transmittal to each record holder of TIB Financial common stock certificates at the effective time of the merger. This mailing will contain instructions on how to surrender TIB Financial common stock certificates in exchange for direct registration shares of book-entry ownership of our Class A common stock. A check in the amount of cash to be paid instead of fractional shares will be sent to you as soon as reasonably practicable following the fourth trading day immediately following the effective time of the merger. When you deliver your TIB Financial stock certificates to the exchange agent along with a properly executed letter of transmittal and any other required documents, your TIB Financial stock certificates will be cancelled and you will receive a direct registration statement indicating book-entry ownership of our Class A common stock representing the number of full shares of our Class A common stock to which you are entitled under the plan of merger. You also will receive a cash payment for any fractional shares of our Class A common stock that would have been otherwise issuable to you as a result of the merger.

Holders of TIB Financial common stock should not submit their TIB Financial stock certificates for exchange until they receive the transmittal instructions and a letter of transmittal form from the exchange agent.

If a certificate for TIB Financial common stock has been lost, stolen or destroyed, the exchange agent will issue the consideration properly payable under the plan of merger upon receipt of appropriate evidence as to that loss, theft or destruction and will require the posting of a bond indemnifying CBF and the exchange agent for any claim that may be made against CBF as a result of the lost, stolen or destroyed certificates. After completion of the merger, there will be no further transfers on the stock transfer books of TIB Financial, except as required to settle trades executed prior to the completion of the merger.

The exchange agent will be entitled to deduct and withhold from the cash in lieu of fractional shares payable to any TIB Financial stockholder the amounts the exchange agent is required to deduct and withhold under any applicable federal, state, local or foreign tax law. If the exchange agent withholds any amounts, these amounts will be treated for all purposes of the merger as having been paid to the stockholders from whom they were withheld.

The merger will become effective when (1) a certificate of ownership and merger is filed with the Delaware Secretary of State and (2) articles of merger are filed with the Florida Department of State or (3) such later time as is specified in the certificate of ownership and merger and the articles of merger. We expect to complete the merger substantially concurrent with the completion of our initial public offering. We currently anticipate the completion of the merger to occur in the second half of 2012. The timing of the merger may change based on the timing of our initial public offering and the timing of our planned mergers with our other bank holding company subsidiaries, which are part of the reorganization. We may choose to complete the merger even if we do not complete our initial public offering.

In addition, we may choose to withdraw the merger if we determine that the merger is no longer in our best interests.

The following is a general discussion of certain material United States federal income tax consequences of the merger to U.S. holders (as defined below) of TIB Financial common stock that exchange their shares of TIB Financial common stock for shares of our Class A common stock in the merger. This discussion does not address any tax consequences arising under the unearned income Medicare contribution tax pursuant to the Health Care and Education Reconciliation Act of 2010, nor does it address any tax consequences arising under the laws of any state, local or foreign jurisdiction, or under any United States federal laws other than those pertaining to the income tax. This discussion is based upon the Code, the regulations promulgated under the Code and court and administrative rulings and decisions, all as in effect on the date of this document. These authorities may change, possibly retroactively, and any change could affect the accuracy of the statements and conclusions set forth in this discussion. Neither we nor TIB Financial has sought or will seek any ruling from the Internal Revenue Service regarding any matters relating to the merger, and as a result, there can be no assurance that the Internal Revenue Service will not assert, or that a court would not sustain, a position contrary to any of the conclusions set forth below.

This discussion addresses only those U.S. holders of TIB Financial common stock that hold their shares of TIB Financial common stock as a “capital asset” within the meaning of Section 1221 of the Code. Further, this discussion does not address all aspects of United States federal income taxation that may be relevant to particular U.S. holders in light of their individual circumstances or to U.S. holders that are subject to special treatment under the United States federal income tax laws, including:

For purposes of this discussion, the term “U.S. holder” means a beneficial owner of TIB Financial common stock that is for United States federal income tax purposes (1) an individual citizen or resident of the United States, (2) a corporation (or any other entity treated as a corporation for U.S. federal income tax purposes) organized in or under the laws of the United States or any state thereof or the District of Columbia, (3) a trust if (a) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust or (b) such trust has made a valid election to be treated as a U.S. person for United States federal income tax purposes or (4) an estate, the income of which is includible in gross income for United States federal income tax purposes regardless of its source.

If an entity or an arrangement treated as a partnership for United States federal income tax purposes holds TIB Financial common stock, and any partners in such partnership, should consult their own tax advisors.

Determining the actual tax consequences of the merger to you may be complex and will depend on your specific situation and on factors that are not within our control. You should consult with your own tax advisor as to the tax consequences of the merger in your particular circumstances, including the applicability and effect of the alternative minimum tax and any state, local, foreign or other tax laws and of changes in those laws.

The parties intend for the merger to be treated as a reorganization within the meaning of Section 368(a) of the Code for United States federal income tax purposes. In connection with the filing of the registration statement of which this document is a part, Wachtell, Lipton, Rosen & Katz will deliver an opinion to CBF to the effect that the merger will qualify for U.S. federal income tax purposes as a “reorganization” within the meaning of Section 368(a) of the Code.

Accordingly, and based on the foregoing opinion, the material U.S. federal income tax consequences of the merger should be as follows. Upon exchanging your TIB Financial common stock for our Class A common stock, you generally will not recognize gain or loss, except with respect to cash received instead of fractional shares of our Class A common stock (as discussed below). The aggregate tax basis in the shares of Class A common stock that you receive in the merger, including any fractional share interests deemed received and redeemed as described below, will equal your aggregate adjusted tax basis in the TIB Financial common stock you surrender in the merger. Your holding period for the shares of Class A common stock that you receive in the merger (including a fractional share interest deemed received and redeemed as described below) will include your holding period for the shares of TIB Financial common stock that you surrender in the merger.

If you receive cash instead of a fractional share of our Class A common stock, you will be treated as having received the fractional share of Class A common stock pursuant to the merger and then as having sold that fractional share of Class A common stock for cash. As a result, you generally will recognize gain or loss equal to the difference between the amount of cash received and the basis in your fractional share of Class A common stock as set forth above. This gain or loss generally will be capital gain or loss, and will be long-term capital gain or loss if, as of the effective date of the merger, the holding period for such fractional share (including the holding period of TIB Financial common stock surrendered therefor) is greater than one year. Long-term capital gains of individuals are generally eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations.

If you are a non-corporate holder of TIB Financial common stock you may be subject, under certain circumstances, to information reporting and backup withholding (currently at a rate of 28%) on any cash payments you receive. You generally will not be subject to backup withholding, however, if you:

Any amounts withheld under the backup withholding rules are not an additional tax and will generally be allowed as a refund or credit against your United States federal income tax liability, provided you timely furnish the required information to the Internal Revenue Service.

This discussion of certain material U.S. federal income tax consequences is for general information only and is not tax advice. Holders of TIB Financial common stock are urged to consult their tax advisors with respect to the application of United States federal income tax laws to their particular situations as well as any tax consequences arising under the United States federal estate or gift tax rules, or under the laws of any state, local, foreign or other taxing jurisdiction or under any applicable tax treaty.

We are a bank holding company incorporated in late 2009 with the goal of creating a regional banking franchise in the southeastern region of the United States through organic growth and acquisitions of other banks, including failed, underperforming and undercapitalized banks. In December 2009 and January and July 2010, we raised approximately $900 million to make acquisitions through a series of private placements of our common stock. Since then, we have acquired six depository institutions, including the assets and certain deposits of the three Failed Banks from the FDIC. We expect to complete the acquisition of a seventh institution through our acquisition of Southern Community Financial in the second half of 2012. As of June 30, 2012, and after giving pro forma effect to our acquisition of Southern Community Financial, we operated 165 branches in Tennessee, Florida, North Carolina, South Carolina and Virginia. Through our branches, we offer a wide range of commercial and consumer loans and deposits, as well as ancillary financial services.

We were founded by a group of experienced bankers with a multi-decade record of leading, operating, acquiring and integrating financial institutions. Our executive management team is led by our Chief Executive Officer, R. Eugene Taylor. Mr. Taylor is the former Vice Chairman of Bank of America, where his career spanned 38 years, including tenure as President of the Consumer and Commercial Bank Corp. He also has extensive experience executing and overseeing bank acquisitions, including NationsBank Corp.’s acquisition and integration of Bank of America, Maryland National Bank and Barnett Banks Inc. Our Chief Financial Officer, Christopher G. Marshall, has over 30 years of financial and managerial experience, including service as the Chief Financial Officer of Fifth Third Bancorp and as the Chief Operations Executive for Bank of America’s Global Consumer and Small Business Bank. Our Chief Risk Officer, R. Bruce Singletary, has over 32 years of experience, including 19 years of experience managing credit risk. He has served as Head of Credit for NationsBank Corp. for the Mid-Atlantic region and as Senior Risk Manager for commercial banking for Bank of America’s Florida Bank. Kenneth A. Posner serves as our Chief of Investment Analytics and Research. Mr. Posner spent 13 years as an equity research analyst at Morgan Stanley focusing on a wide range of financial services firms.

After giving pro forma effect to our acquisition of Southern Community Financial, as of June 30, 2012, we had approximately $7.7 billion in total assets, $5.0 billion in loans, $6.1 billion in deposits and $1.0 billion in shareholders’ equity.

Our banking operations commenced on July 16, 2010, when we purchased approximately $1.2 billion of assets and assumed approximately $960.1 million of deposits of the three Failed Banks from the FDIC. We did not pay the FDIC a premium for the deposits of the Failed Banks. In connection with these acquisition, we entered into loss sharing agreements with the FDIC covering approximately $796.1 million of outstanding loans balances and real estate of the Failed Banks that we acquired. Under the loss sharing arrangements, the FDIC has agreed to absorb 80% of all future credit losses and workout expenses on these assets which occur prior to the expiration of the loss sharing agreements. On September 30, 2010, we invested approximately $175.0 million in TIB Financial, a publicly held financial services company that had total assets of approximately $1.7 billion and operated 28 branches in southwest Florida and the Florida Keys. On January 28, 2011, we invested approximately $181.1 million in Capital Bank Corp., a publicly held financial services company that had approximately $1.7 billion in assets and operated 32 branches in central and western North Carolina. In addition, on September 7, 2011, we invested approximately $217.0 million in Green Bankshares, a publicly held financial services company that had approximately $2.4 billion in assets and operated 63 branches across East and Middle Tennessee in addition to one branch in each of Virginia and North Carolina. Within an 18-month period, we have integrated and centralized the underwriting, risk and pricing functions of our first six acquired institutions and combined them all onto a single information processing system. Southern Community Financial currently operates on a different information system, but, like all previously acquired information platforms, we expect to convert it to conform to our single platform structure soon after the closing of the acquisition.

On July 16, 2010, we purchased substantially all of the assets and assumed all of the deposits of First National Bank in Spartanburg, South Carolina, Metro Bank in Miami, Florida and Turnberry Bank in Aventura, Florida. None of the Failed Banks were affiliated with one another. First National Bank, founded in 1999, was a mid-sized community bank targeting customers located in the Spartanburg, Greenville, Charleston, Columbia and York County markets in South Carolina that operated 13 branches at the time we acquired it from the FDIC. Metro Bank, founded in 1984, was a privately held community bank that operated six branches in Miami, Coral Gables, Sunrise and Lighthouse Point, Florida at the time we acquired it from the FDIC. Turnberry Bank, founded in 1985, was a privately held community bank that operated four branches in Aventura, Coral Gables, Pinecrest and South Miami, Florida at the time we acquired it from the FDIC.

Our acquisition of the Failed Banks resulted in our acquiring assets with an estimated fair value of $1.2 billion, which included $768.6 million of loans, $74.4 million of investment securities, $184.3 million of cash and cash equivalents and a $137.3 million FDIC indemnification asset. We also assumed liabilities with a fair value of $1.1 billion, which included $960.1 million of deposits and $148.6 million of borrowings.

These transactions gave us an initial market presence in Miami, which we targeted because of its size and concentrated business activity, and South Carolina, which we targeted because of its attractive demographic growth trends.

In connection with our acquisition of the Failed Banks, we entered into loss sharing agreements with the FDIC covering approximately $796.1 million of loans and real estate owned by the Failed Banks that we acquired. Under the loss sharing agreements, the FDIC agreed to absorb 80% of all future credit losses and workout expenses on these assets which occur prior to the expiration of the loss sharing agreements. We will reimburse the FDIC for its share of recoveries with respect to losses for which the FDIC paid us a reimbursement under the loss sharing agreements and 50% of certain fully charged-off assets.

The loss sharing agreements consists of three (one for each Failed Bank) single-family shared-loss agreements and three (one for each Failed Bank) commercial and other loans shared-loss agreements. The single family shared-loss agreements provide for FDIC loss sharing and reimbursement to us for recoveries to the FDIC for ten years from July 16, 2010 for single-family residential loans. The commercial shared-loss agreements provide for FDIC loss sharing for five years from July 16, 2010 and our reimbursement for recoveries to the FDIC for eight years from July 16, 2010 for all other covered assets.

The covered assets that we acquired in connection with our acquisition of the Failed Banks include one-to-four family residential real estate loans (both owner occupied and non-owner occupied), home equity loans and commercial loans.

We have agreed to make a true-up payment, also known as clawback liability, to the FDIC on the date that is 45 days following the last day of the final shared loss month, or upon the final resolution of all covered assets under the loss sharing agreements in the event losses thereunder fail to reach expected levels, not to exceed ten years from the date of our acquisition of the Failed Banks. The estimated fair value of the true-up payment as of the acquisition date was $1.0 million.

Under the loss sharing agreements, we are limited in our ability to dispose of covered assets and we are required to follow specific servicing procedures and to undertake loss mitigation efforts. Additionally, the FDIC has information rights with respect to our performance, requiring us to maintain detailed compliance records.

The carrying value of the FDIC indemnification asset at June 30, 2012 was $60.8 million.

On September 30, 2010, we invested approximately $175.0 million in TIB Financial, a publicly held bank holding company headquartered in Naples, Florida that had total assets of approximately $1.7 billion and operated 28 branches in southwest Florida and the Florida Keys. Upon the closing of the TIB Financial investment on September 30, 2010, we owned approximately 99% of the outstanding voting power of TIB Financial. TIB Financial subsequently completed a rights offering to legacy TIB Financial stockholders, which reduced our ownership interest in TIB Financial to approximately 94%. In connection with our TIB Financial investment, we acquired a warrant to purchase an additional $175.0 million in TIB common stock on substantially the same terms as our initial investment, exercisable in whole or in part until March 30, 2012. On March 31, 2012, the warrant expired unexercised. On April 29, 2011, we combined TIB Financial’s banking subsidiary, TIB Bank, with our banking subsidiary, NAFH National Bank (whose name has since changed to Capital Bank, National Association) in an all-stock transaction.

TIB Financial has been executing a community bank business strategy for individuals and businesses in the Florida Keys for 37 years. Prior to TIB Bank’s merger with NAFH National Bank, it had 27 full-service banking offices in Florida that were located in Monroe, Miami-Dade, Collier, Lee and Sarasota counties.

The TIB Financial investment resulted in us acquiring assets with a fair value of $1.7 billion, which included $1.0 billion of loans, $309.3 million of investment securities and $229.7 million of cash and cash equivalents. We also assumed liabilities with a fair value of $1.6 billion, which included $1.3 billion of deposits and $208.8 million of subordinated debt and other borrowings.

In connection with the TIB Financial investment, Messrs. Taylor, Marshall, Foss, Hodges and Singletary were each appointed to the board of directors of TIB Financial. Two existing members of the TIB Financial board, Mr. Howard Gutman and Mr. Brad Boaz, also remain on the TIB Financial board.

This acquisition expanded our geographic reach in Florida to include markets that we believe have particularly attractive deposit customer characteristics and provided a platform to support our future growth.

On January 28, 2011, we invested approximately $181.1 million in Capital Bank Corp., a publicly held bank holding company headquartered in Raleigh, North Carolina that had approximately $1.7 billion in assets and operated 32 branches in central and western North Carolina. Upon closing of the Capital Bank Corp. investment, we owned approximately 85% of the voting power of Capital Bank Corp. Also, in connection with the investment, each existing Capital Bank Corp. stockholder received one contingent value right (which we refer to as a “CVR”) per share that entitles the holder to receive up to $0.75 in cash per CVR at the end of a five-year period based on the credit performance of Capital Bank Corp.’s existing loan portfolio. Holders of CVRs will receive payments under the CVR only if the total amount of credit losses are less than $103,000,000 (or $8.00 per CVR) during such five-year period. Total credit losses through June 30, 2012 were $90.9 million (or $7.05 per CVR). The maximum amount that may be payable under the Capital Bank Corp. CVR at the end of its five-year term is approximately $9.7 million. Capital Bank Corp. subsequently completed a rights offering to legacy Capital Bank Corp. stockholders, which reduced our ownership interest to approximately 83%. On June 30, 2011, we combined Capital Bank Corp.’s banking subsidiary, Capital Bank, with our banking subsidiary, NAFH National Bank, in an all-stock transaction and, simultaneously with the consummation of the transaction, changed the name of NAFH National Bank to Capital Bank, National Association.

Capital Bank Corp., incorporated in 1998, is a community bank engaged in the general commercial banking business, primarily in markets in central and western North Carolina. It operates 32 branch offices in North Carolina: five branch offices in Raleigh, four in Asheville, four in Fayetteville, three in Burlington, three in Sanford, two in Cary and one in each of Clayton, Graham, Hickory, Holly Springs, Mebane, Morrisville, Oxford, Siler City, Pittsboro, Wake Forest and Zebulon.

The Capital Bank Corp. investment resulted in us acquiring assets with an estimated fair value of $1.7 billion at the acquisition date, which included $1.1 billion of loans, $225.3 million of investment securities and $208.3 million of cash and cash equivalents. We also assumed liabilities with a fair value of $1.5 billion, which included $1.4 billion of deposits and $143.2 million of subordinated debt and other borrowings.

In connection with the Capital Bank Corp. investment, Messrs. Taylor, Marshall, Foss, Hodges and Singletary were each appointed to the board of directors of Capital Bank Corp. Two existing members of the Capital Bank Corp. board of directors, Mr. Oscar A. Keller, III and Mr. Charles F. Atkins, also remain on the Capital Bank Corp. board. Additionally in connection with the Capital Bank Corp. investment, we agreed to appoint two Capital Bank Corp. board members to our Board of Directors. As the two remaining legacy directors of the Capital Bank Corp. board, we intend to appoint Messrs. Keller and Atkins to these positions. This transaction gave us a strong presence in fast-growing North Carolina markets, including the Raleigh MSA, which, according to SNL Financial, has the eleventh highest projected population growth rate in the nation, with over 12% growth projected between 2011 and 2016.

On September 7, 2011, we invested approximately $217.0 million in Green Bankshares, a publicly held bank holding company headquartered in Greeneville, Tennessee that had approximately $2.4 billion in assets reported at the date of acquisition and operated 63 branches across East and Middle Tennessee in addition to one branch in each of Virginia and North Carolina. Total assets at the date of acquisition included gross loans of $1.3 billion. Also, in connection with the investment, each existing Green Bankshares stockholder received one CVR per share that entitles the holder to receive up to $0.75 in cash per CVR at the end of a five-year period based on the credit performance of Green Bankshares’ existing loan portfolio. We estimate that the maximum amount that may be payable under the Green Bankshares CVR at the end of its five-year term to be approximately $10.0 million, based on the number of Green Bankshares common stock outstanding as of September 6, 2011. Upon completion of our investment, we owned approximately 90.0% of Green Bankshares’ common stock. On September 7, 2011, following the completion of our controlling investment in Green Bankshares, we merged GreenBank, Green Bankshares’ banking subsidiary, into Capital Bank in an all-stock transaction similar to the other bank mergers described above.

Green Bankshares is the third largest bank holding company headquartered in Tennessee and parent company of GreenBank, a Tennessee-chartered commercial bank established in 1890. GreenBank provides general banking services through its branches located in Greene, Blount, Cocke, Hamblen, Hawkins, Knox, Loudon, McMinn, Monroe, Sullivan and Washington Counties in East Tennessee and in Davidson, Lawrence, Macon, Montgomery, Rutherford, Smith, Sumner and Williamson Counties in Middle Tennessee. GreenBank also operates one branch in Madison County, North Carolina and one branch in Bristol, Virginia as well as a mortgage banking operation in Knox County, Tennessee.

The Green Bankshares investment resulted in us acquiring assets with a reported carrying value at the date of acquisition of $2.4 billion, including $1.3 billion of loans, $174.2 million of investment securities and $542.7 million of cash and cash equivalents. We also assumed liabilities with a reported carrying value at the date of acquisition of $2.1 billion, including $1.9 billion of deposits and $231.2 million of subordinated debt and other borrowings.

In connection with the Green Bankshares investment we appointed Messrs. Taylor, Marshall, Foss, Hodges and Singletary to the board of directors of Green Bankshares. Two existing members of the Green Bankshares’ board of directors, Ms. Martha M. Bachman and Mr. Samuel E. Lynch, remained on the Green Bankshares board, with the remaining existing directors resigning. Additionally, we agreed that following the closing of the Green Bankshares investment, we will also appoint the two legacy Green Bankshares directors to our Board of Directors. As the two remaining legacy directors of the Green Bankshares board, we intend to appoint Ms. Bachman and Mr. Lynch to these positions.

This transaction extended our market area in the fast-growing Tennessee metropolitan areas of Nashville and Knoxville.

On March 26, 2012, we agreed to acquire all of the common equity interest in Southern Community Financial, a publicly held bank holding company headquartered in Winston Salem, North Carolina that had approximated $1.4 billion in assets reported as of June 30, 2012 and operated 22 branches in Winston-Salem, the Piedmont Triad and other North Carolina markets. On June 25, 2012, we amended our agreement with Southern Community Financial to change the form of consideration offered to Southern Community stockholders. The merger consideration for all of the common equity interest consists of approximately $52.4 million in cash. Total assets at June 30, 2012 included gross loans of $0.9 billion. Also, in connection with the acquisition, each existing shareholder of Southern Community Financial will receive one CVR per share that entitles the holder to receive up to $1.30 in cash per share at the end of a five-year period based on the credit performance of Southern Community Financial’s existing loan portfolio. We estimate that the maximum amount that may be payable under the Southern Community Financial CVR at the end of its five-year term to be approximately $21.9 million, based on the number of Southern Community Financial common stock outstanding as of June 30, 2012. Our acquisition of Southern Community Financial is subject to Southern Community Financial stockholder approval, regulatory approvals and other customary closing conditions, and is expected to be completed in the second half of 2012.

Southern Community Financial, founded in 1996, is the parent of Southern Community Bank and Trust and currently controls the third largest share of deposits in the Winston-Salem MSA and the fourth largest metropolitan statistical area (which we refer to as “MSA”) and the fifth largest MSA in North Carolina. It operates in the neighboring counties of Guilford, Stokes, Surry and Yadkin counties with a branch each in Raleigh and Asheville.

Upon completion, the Southern Community Financial acquisition will result in us acquiring assets with a reported carrying value at June 30, 2012 of $1.4 billion, including $0.9 billion of loans, $0.3 billion of investment securities and $0.1 billion of cash and cash equivalents. We will also assume liabilities with a reported carrying value at June 30, 2012 of $1.3 billion, including $1.1 billion of deposits and $0.2 billion of subordinated debt and other borrowings.

The terms of the Southern Community Financial acquisition provide that, upon completion of our acquisition, we will appoint a legacy Southern Community Financial director to our Board of Directors and to appoint two legacy directors to Capital Bank’s board of directors.

This acquisition will extend our market area in the North Carolina markets, including Winston-Salem and the Piedmont Triad.

Substantially concurrent with the completion of the merger, we intend to merge each of our other majority-held bank holding company subsidiaries (Capital Bank Corp. and Green Bankshares) with the Company. In connection with the mergers of our majority-held subsidiaries, we expect that existing third-party stockholders of these subsidiaries will receive shares of Class A common stock in exchange for their minority existing shares. We estimate that we will issue approximately 3,709,832 shares of Class A common stock to the other shareholders of our bank holding company subsidiaries that will be merged with the Company in the reorganization. Following the completion of the initial public offering and the reorganization, we will be a publicly traded bank holding company with a single directly and wholly owned bank subsidiary, Capital Bank, N.A.

The following diagrams illustrate our ownership structure, including our principal subsidiaries, as of the date of this prospectus and immediately after the completion of the reorganization:

Our business strategy is to build a mid-sized regional bank by operating, integrating and growing our existing operations as well as to acquire other banks, including failed, underperforming and undercapitalized banks and other complementary assets. We believe recent and continuing dislocations in the southeastern U.S. banking industry have created an opportunity for us to create a mid-sized regional bank that will be able to realize greater economies of scale compared to smaller community banks while still providing more personalized, local service than larger-sized banks.

Our operating strategy emphasizes relationship banking focused on commercial and consumer lending and deposit gathering. We have organized operations under a line of business operating model, under which we have appointed experienced bankers to oversee loan and deposit production in each of our markets, while centralizing credit, finance, technology and operations functions. Our management team possesses significant executive-level leadership experience at Fortune 500 financial services companies, and we believe this experience is an important advantage in executing this regional, more focused, bank business model.

The primary components of our operating strategy are to originate high-quality loans and low-cost customer deposits. Our executive management team has developed a hands-on operating culture focused on performance and accountability, with frequent and detailed oversight by executive management of key performance indicators. We have implemented a sales management system for our branches that is focused on growing loans and core deposits in each of our markets. We believe that this system holds loan officers and branch managers accountable for achieving loan production goals, which are subject to the conservative credit standards and disciplined underwriting practices that we have implemented as well as compliance, profitability and other standards that we monitor. We also believe that accountability is crucial to our results. Our executive management monitors production, credit quality and profitability measures on a quarterly, monthly, weekly and,

in some cases, daily basis and provides ongoing feedback to our business unit leaders. During the first six months of 2012, we originated $447.3 million of new commercial and consumer loans. During the first six months of 2012, we also grew our core deposits by $129.5 million (or 8.8% annualized growth).

The current market conditions have forced many banks to focus internally, which we believe creates an opportunity for organic growth by strongly capitalized banks such as ourselves. We seek to grow our loan portfolio by offering personalized customer service, local market knowledge and a long-term perspective. We have selectively hired experienced loan officers with local market knowledge and existing client relationships. Additionally, our executive management team takes an active role in soliciting, developing and maintaining client relationships.

Another key element of our strategy is to operate efficiently by carefully managing our cost structure and taking advantage of economies of scale afforded by our acquisitions to control operating costs. We have been able to reduce headcount by consolidating duplicative operations of the acquired banks and streamlining management. In addition, we expect to recognize additional cost savings once we have fully integrated Southern Community Financial, which is currently operating on a different processing platform, with the rest of our business. We plan to further improve efficiency by boosting the productivity of our sales force through our focus on accountability and employee incentives and through selective hiring of experienced loan officers with existing books of business.

To evaluate and control operating costs, we monitor certain performance metrics including our efficiency ratio, which equals total non-interest expense divided by net revenue (net interest income plus non-interest income). Our efficiency ratio has been and is expected to continue to be significantly impacted by certain costs that follow acquisitions of financial institutions. Our efficiency ratio for the six months ended June 30, 2012 was 79.0%, which was impacted by $3.0 million in merger reflected expenses and contract termination and other expenses related to the integration of our operations onto common technology platforms and $3.6 million of investment security gains. The system conversions are intended to create operating efficiencies and better position us for future growth. Excluding the impact of these items and $10.7 million of non-cash equity compensation expense, our adjusted efficiency ratio for the six months ended June 30, 2012 was 71.8%. Our efficiency ratio for the year ended December 31, 2011 was 78.4%, which was impacted by $9.2 million of non-cash equity compensation, $7.6 million of conversion expenses due to integration of the acquired banks, $1.5 million of legal fees related to the acquisitions of Capital Bank and Green Bankshares and $2.9 million of impairment of intangible assets and $4.4 million of investment security gains. Excluding the impact of these items, our adjusted efficiency ratio for the year ended December 31, 2011 was 70.6%. The adjusted efficiency ratio is a non-GAAP measure which we believe provides investors with information useful in understanding our business and our operating efficiency. Comparison of our adjusted efficiency ratio with those of other companies may not be possible because other companies may calculate the adjusted efficiency ratio differently. The adjusted efficiency ratio, which equals adjusted non-interest expense (non-interest expense less conversion expense) divided by net revenues (net interest income plus non-interest income), for the six months ended June 30, 2012 and the year ended December 31, 2011 is as follows:

We seek acquisition opportunities consistent with our business strategy that we believe will produce attractive returns for our stockholders. We plan to pursue acquisitions that position us in southeastern U.S. markets with attractive demographics and business growth trends, expand our branch network in existing markets, increase our earnings power or enhance our suite of products. Our future acquisitions may include distressed assets sold by the FDIC or another seller where our operations, underwriting and servicing capabilities or management experience give us an advantage in evaluating and resolving the assets.

Our acquisition process begins with detailed research of target institutions and the markets they serve. We then draw on our management team’s extensive experience and network of industry contacts in the southeastern region of the United States. Our research and analytics team, led by our Chief of Investment Analytics and Research, maintains lists of priority targets for each of our markets. The team analyzes financial, accounting, tax, regulatory, demographic, transaction structures and competitive considerations for each target and prepares acquisition projections for review by our executive management team and Board of Directors.

As part of our diligence process in connection with potential acquisitions, we undertake a detailed portfolio- and loan-level analysis conducted by a team of experienced credit analysts led by our Chief Risk Officer. In addition, our executive management team engages the target management teams in active dialogue and personally conducts extensive on-site diligence at target branches.

Our executive management team has demonstrated success not only in acquiring financial institutions and combining them onto a common platform, but also in managing the integration of those financial institutions. Our management team develops integration plans prior to the closing of a given transaction that allows us to (1) reorganize the acquired institution’s management team under our line of business model immediately after closing; (2) implement our credit risk and interest rate risk management, liquidity and compliance and governance policies and procedures; and (3) integrate our target’s technology and processing systems rapidly. Using our procedures, we have already integrated credit and operational policies across each of our acquisitions. We reorganized the management of the Failed Banks within three months of closing, and we merged their core processing systems with TIB Financial’s platform within six months. We also fully integrated Capital Bank Corp. in July 2011 and Green Bankshares in February 2012.

Sound risk management is an important element of our commercial/retail bank business model and is overseen by our Chief Risk Officer, Bruce Singletary, who has over 19 years of experience managing credit risk. Our credit risk policy, which has been implemented across our organization, establishes prudent underwriting guidelines, limits portfolio concentrations by geography and loan type and incorporates an independent loan review function. Mr. Singletary has created a special assets division with approximately 50 employees to work out or dispose of legacy problem assets using a detailed process taking into account a borrower’s repayment capacity, available guarantees, collateral value, interest accrual and other factors. We believe our risk management policies establish conservative regulatory capital ratios, robust liquidity (including contingency planning), limitations on wholesale funding (including brokered CDs, holding company debt and advances from the FHLB), and restrictions on interest rate risk.

We view our market area as the southeastern region of the United States. Our seven acquisitions (including our pending acquisition of Southern Community Financial) have established a footprint defined by the Miami-Raleigh-Nashville triangle, which includes the Carolinas, Southwest Florida (Naples) and Southeast Florida (Miami-Dade and the Keys). These markets include a combination of large and fast-growing metropolitan areas that we believe will offer us opportunities for organic loan and deposit growth. According to SNL Financial, the Raleigh MSA has the eleventh highest projected population growth rate in the nation, with over 12% growth projected between 2011 and 2016. Similarly, the Nashville MSA is projected to grow by 7.1%. The Miami MSA is already considered a large metropolitan area with a population in excess of 5 million. Approximately 47% of our current branches are located in our target MSAs. The following table highlights key demographics of our target market areas:

We have integrated our first six acquisitions under a single line of business operating model and are in the process of integrating the seventh. Under this model, we have appointed experienced bankers to oversee loan and deposit growth in each of our markets, while we have centralized other functions, including credit, finance, operations, marketing, human resources and information technology.

Our commercial bank business consists of teams of commercial loan officers operating under the leadership of commercial banking executives in Florida, the Carolinas and Tennessee. The commercial banking executives are responsible for production goals for loans, deposits and fees. They work with senior credit officers to ensure

that loan production is consistent with our loan policies and with financial officers to ensure that loan pricing is consistent with our profitability goals. We focus our commercial bank business on loan originations for established small and middle-market businesses with whom we develop personal relationships that we believe give us a competitive advantage and differentiates us from larger banking institutions. In addition, our commercial lending teams coordinate with personnel in our consumer bank business to provide personal loans and other services to the owners and managers and employees of the bank’s commercial clients. At June 30, 2012, commercial loans totaled $2.8 billion (or 67.8% of our total loan portfolio). Commercial underwriting is driven by cash flow analysis supported by collateral analysis and review. Our commercial lending teams offer a wide range of commercial loan products, including:

During the first six months of 2012, we originated $277.1 million of new commercial loans. Our commercial lending teams also seek to gather low-cost deposits from commercial customers in connection with extending credit. In addition to business demand, savings and money market accounts, we also provide specialized cash management services and deposit products.

Our consumer bank business consists of Capital Bank’s retail banking branches and associated businesses. Similar to our commercial bank business, we have organized the consumer bank by geographical market, with divisions consisting of our Florida, Carolina and Tennessee branches. Each division reports to a consumer banking executive responsible for achieving core deposit and consumer loan growth goals. Pricing of our deposit products is reviewed and approved by our asset-liability committee and the standards for consumer loan credit quality are documented in our loan policy and reviewed by our credit executives.

We seek to differentiate our consumer bank business from competitors through the personalized service offered by our branch managers, customer service representatives, tellers and other staff. We offer various services to meet the needs of our customers, including checking, savings and money market accounts, certificates of deposit and debit and credit cards. Our products are designed to foster relationships by rewarding our best customers for desirable activities such as debit card transactions, e-statements and direct deposit. In addition to traditional products and services, we offer competitive technology in Internet banking services, which we plan to further upgrade in order to keep pace with technological improvements. Consumer loan products we offer include:

Branch managers and their staff are charged with growing core deposits with a special focus on new demand deposit accounts and expected to conduct outbound telephone campaigns, generate qualified referrals, collaborate with business partners in the commercial lending teams and evaluate, and make informed decisions with respect

to, existing and prospective customers. In the first six months of 2012, we generated organic core deposit growth of $129.5 million (or 8.8% annualized growth). As of June 30, 2012, consumer loans totaled $1.3 billion. During the first six months of 2012, we originated $121.5 million of new consumer loans.

Through our newly established mortgage banking business, we aim to originate high-quality loans for customers who are willing to establish a deposit relationship with us. The mortgage loans in our portfolio that do not meet this criteria are sold in to the secondary market to buyers, such as Fannie Mae and Freddie Mac, and provide an additional source of fee income. Our mortgage banking capabilities include conventional and nonconforming mortgage underwriting and construction and permanent financing.

We offer wealth management services to affluent clients, business owners and retirees, building new relationships and expanding existing relationships to grow deposits, loans and fiduciary and investment management fee income. Through wealth management, we offer deposit products, commercial and consumer loans, including mortgage financing, and investment accounts providing access to a wide range of mutual funds, annuities and other financial products, as well as access to our subsidiary, Naples Capital Advisors, which is a registered investment advisor with approximately $54.4 million in assets under management as of June 30, 2012.

We originate a variety of loans, including loans secured by real estate, loans for construction, loans for commercial purposes, loans to individuals for personal and household purposes, loans to municipalities and loans for new and used cars. A significant portion of our loan portfolio is related to real estate. As of June 30, 2012, loans related to real estate totaled $3.5 billion (or 84% of our total loan portfolio). The economic trends in the regions we serve are influenced by the industries within those regions. Consistent with our emphasis on being a community-oriented financial institution, most of our lending activity is with customers located in and around counties in which we have banking offices. As of June 30, 2012, our owner occupied commercial real estate loans, non-owner occupied commercial real estate loans, residential mortgage loans and commercial and industrial loans represented 24%, 20%, 18% and 11%, respectively, of our $4.2 billion loan portfolio.

We use a centralized risk management process to ensure uniform credit underwriting that adheres to our loan policies as approved annually by our Board of Directors. Lending policies are reviewed on a regular basis to confirm that we are prudent in setting underwriting criteria. Credit risk is managed through a number of methods, including a loan approval process that establishes consistent procedures for the processing and approval of loan requests, risk grading of all commercial loans and certain consumer loans and coding of all loans by purpose, class and collateral type. We seek to focus on underwriting loans that enhance a balanced, diversified portfolio. Management analyzes our commercial real estate concentrations by market and region on a regular basis in an attempt to prevent overexposure to any one type of commercial real estate loan and incorporates third-party real estate and market analysis to monitor market conditions. As of June 30, 2012, the carrying value of our commercial real estate loans in North Carolina, South Carolina, Florida, Tennessee and Virginia totaled $647.6 million, $342.9 million, $791.7 million, $587.5 million and $0.1 million, respectively, and the reported value of Southern Community Financial’s commercial real estate loans, which are in North Carolina, totaled $446.7 million, of which $115.1 million was owner-occupied. At June 30, 2012, commercial real estate loans in all regions totaled $2.3 billion (24% of which was owner occupied commercial real estate). We have recently tightened underwriting and pricing standards for indirect auto and residential mortgage lending and de-emphasized originations of commercial real estate mortgages.

We believe that early detection of potential credit problems through regular contact with our clients, coupled with consistent reviews of the borrowers’ financial condition, are important factors in overall credit risk

management. Our approach to proactively manage credit quality is to aggressively work with customers for whom a problem loan has been identified and assist in resolving issues before a default occurs.

A key component of our growth strategy is to grow our loan portfolio by originating high-quality commercial and consumer loans, other than non-owner occupied real estate loans, that comply with our conservative credit policies and that produce revenues consistent with our financial objectives. From December 31, 2011 to June 30, 2012, our loan portfolio declined by $111.4 million as a result of $267.3 million of resolutions and $291.4 million of principal repayments offset by $447.3 million in new originations. Additionally, we are working to reduce excessive concentrations in commercial real estate, which characterized our acquisitions’ legacy portfolios, in order to achieve a more diversified portfolio. It is our long-term goal to reduce the commercial real estate concentration to approximately 20% of our total loan portfolio.

In addition, we operate an indirect auto lending business which originates loans for new and used cars through relationships with dealers in Southwest Florida, Southeast Florida, the Florida Keys, and Tennessee. Loans are approved subject to review of FICO credit scores, vehicle age, and loan-to-value. We are in the process of implementing an expert scoring model which will include additional proprietary underwriting factors. We set pricing for loans based on credit score, vehicle age, and loan term. As of June 30, 2012, we had $93.7 million of auto loans.

Deposits are the primary source of funds for lending and investing activities and their cost is the largest category of interest expense. Deposits are attracted principally from clients within our branch network through the offering of a wide selection of deposit instruments to individuals and businesses, including non-interest-bearing checking accounts, interest-bearing checking accounts, savings accounts, money market deposit accounts, certificates of deposit and individual retirement accounts. We are focused on reducing our reliance on high-cost certificates of deposit as a source of funds by replacing them with low-cost deposit accounts. Deposit account terms vary with respect to the minimum balance required, the time period the funds must remain on deposit and service charge schedules. Interest rates paid on specific deposit types are determined based on (1) the interest rates offered by competitors, (2) the anticipated amount and timing of funding needs, (3) the availability and cost of alternative sources of funding and (4) the anticipated future economic conditions and interest rates. Client deposits are attractive sources of funding because of their stability and relatively low cost. Deposits are regarded as an important part of the overall client relationship and provide opportunities to cross-sell other services. In addition, we gather a portion of our deposit base through brokered deposits. At June 30, 2012, total deposits were $5.0 billion of which $4.8 billion (or 97%) were non-brokered deposits and $131.4 million (or 3%) were brokered deposits. At June 30, 2012, our core deposits (total deposits less time deposits) consisted of $735.0 million of non-interest checking accounts, $1.1 billion of negotiable order of withdrawal accounts, $378.4 million of savings accounts and $890.4 million of money market deposits. For the foreseeable future, we remain focused on retaining and growing a strong deposit base and transitioning certain of our customers to low-cost banking services as high-cost funding sources, such as high-interest certificates of deposit, mature.

Our marketing activities support all of our products and services described above. Historically, most of our marketing efforts have supported our real estate mortgage, commercial and retail banking businesses. Our marketing strategy aims to:

We use a variety of targeted marketing media including the Internet, print, direct mail and financial newsletters. Our online marketing activities include paid advertising, as well as cross-sale marketing through our website and Internet banking services. We believe our marketing strategy will enable us to take advantage of lower average customer acquisition costs, build valuable brand awareness and lower our funding costs.

We have made and continue to make investments in our information technology systems for our banking and lending operations and cash management activities. We seek to integrate our acquisitions quickly and successfully and believe this is a necessary investment in order to enhance our capabilities to offer new products and overall customer experience and to provide scale for future growth and acquisitions. Our enhancements are tailored to improve our commercial and consumer loan origination, electronic banking and direct response marketing processes, as well as enhance cash management, streamlined reporting, reconciliation support and sales support. We work closely with certain third-party service providers to which we outsource certain of our systems and infrastructure. We use the Jack Henry SilverLake System as our banking platform and believe that the scalability of our infrastructure will support our growth strategy and that this platform will support our growth needs.

The financial services industry in general and our primary markets of South Florida, Tennessee and the Carolinas are highly competitive. We compete actively with national, regional and local financial services providers, including banks, thrifts, credit unions, mortgage bankers and finance companies, money market mutual funds and other financial institutions, some of which are not subject to the same degree of regulation and restrictions imposed upon us. Our largest competitors include Bank of America, Wells Fargo, BB&T, First Citizens, Royal Bank of Canada, SunTrust, Regions, FNB United Corp., Toronto-Dominion, Synovus, First Financial, SCBT, JPMorgan Chase, Citigroup, EverBank, Fifth Third Bancorp, First Horizon, Pinnacle Financial, First South and U.S. Bancorp.

Competition among providers of financial products and services continues to increase, with consumers having the opportunity to select from a growing variety of traditional and nontraditional alternatives. The primary factors driving commercial and consumer competition for loans and deposits are interest rates, the fees charged, customer service levels and the range of products and services offered. In addition, other competitive factors include the location and hours of our branches and customer service.

At June 30, 2012, we had over 1,362 full-time employees and 118 part-time employees. None of our employees are parties to a collective bargaining agreement. We consider our relationship with our employees to be adequate.

We currently lease approximately 354,000 square feet of office and operations space in Florida, North Carolina, South Carolina and Tennessee. In addition, we own approximately 150,000 square feet and lease approximately 145,000 square feet of non-branch office space. We operate 35 branches in Florida, 32 in North Carolina, 12 in South Carolina, 63 in Tennessee and one in Virginia. Of these branches, 50 were leased and the rest were owned. Southern Community Financial operates 22 branches in North Carolina. Management believes the terms of the various leases are consistent with market standards and were arrived at through arm’s-length bargaining.

On November 18, 2010 a shareholder of Green Bankshares filed a putative class action lawsuit (styled Bill Burgraff v. Green Bankshares, Inc., et al., U.S. District Court, Eastern District of Tennessee, Northeastern Division, Case No. 2:10-cv-00253) against Green Bankshares and certain of its current and former officers in the United States District Court for the Eastern District of Tennessee in Greeneville, Tennessee on behalf of all persons that acquired shares of Green Bankshares’ common stock between January 19, 2010 and November 9, 2010. On January 18, 2011, a separate shareholder of Green Bankshares filed a putative class action lawsuit (styled Brian Molnar v. Green Bankshares, Inc., et al., U.S. District Court, Eastern District of Tennessee, Northeastern Division, Case No. 2:11-cv-00014) against Green Bankshares and certain of its current and former officers in the same court on behalf of all persons that acquired shares of Green Bankshares’ common stock between January 19, 2010 and October 20, 2010. These lawsuits were filed following, and relate to the drop in value of Green Bankshares’ common stock price after, Green Bankshares announced its third quarter performance results on October 20, 2010. The plaintiffs allege that defendants made false and/or misleading statements or failed to disclose that Green Bankshares was purportedly overvaluing collateral of certain loans; failing to timely take impairment charges of these certain loans; failing to properly account for loan charge-offs; lacking adequate internal and financial controls; and providing false and misleading financial results. The plaintiffs have asserted federal securities laws claims against all defendants for alleged violations of Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder. The plaintiffs have also asserted control person liability claims against the individual defendants named in the complaints pursuant to Section 20(a) of the Exchange Act. The two cases were consolidated on February 4, 2011. On February 11, 2011, the Court appointed movant Jeffrey Blomgren as lead plaintiff. On May 3, 2011, the plaintiff filed an amended and consolidated complaint alleging a class period of January 19, 2010 to November 9, 2010. On July 11, 2011, the defendants filed a motion to dismiss the consolidated amended complaint. The parties have reached a proposed settlement, which is scheduled to be presented before the Court on September 26, 2012 for approval. The costs of the proposed settlement are expected to be paid by Green Bankshares’ insurer.

The following discussion should be read in conjunction with the “Selected Historical Consolidated Financial Information,” and our financial statements and related notes thereto included elsewhere in this prospectus. In addition to historical information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from management’s expectations. Factors that could cause such differences are discussed in the sections entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors.” We assume no obligation to update any of these forward-looking statements.

The following discussion pertains to our historical results, which includes the operations of First National Bank, Metro Bank, Turnberry Bank, TIB Financial, Capital Bank Corp. and Green Bankshares subsequent to our acquisition of each such entity. In this discussion, unless the context suggests otherwise, references to “Old Capital Bank” refer to Capital Bank Corp.’s banking subsidiary prior to June 30, 2011, the date on which NAFH National Bank merged with Old Capital Bank and changed its name to Capital Bank, National Association.

Throughout this discussion we collectively refer to the above acquisitions as the “acquisitions”.

We are a bank holding company incorporated in late 2009 with the goal of creating a regional banking franchise in the southeastern region of the United States through organic growth and acquisitions of other banks, including failed, underperforming and undercapitalized banks. In December 2009 and January and July 2010, we raised approximately $900 million to make acquisitions through a series of private placements of our common stock. Since then, we have acquired six depository institutions, including the assets and certain deposits of the three Failed Banks from the FDIC. We expect to complete the acquisition of a seventh institution owned by Southern Community Financial in the second half of 2012. As of June 30, 2012, and after giving pro forma effect to our acquisition of Southern Community Financial, we operated 165 branches in Florida, North Carolina, South Carolina, Tennessee and Virginia. Through our branches, we offer a wide range of commercial and consumer loans and deposits, as well as ancillary financial services.

We were founded by a group of experienced bankers with a multi-decade record of leading, operating, acquiring and integrating financial institutions. Our executive management team is led by our Chief Executive Officer, R. Eugene Taylor. Mr. Taylor is the former Vice Chairman of Bank of America Corp., where his career spanned 38 years, including tenure as President of the Consumer and Commercial Bank. He also has extensive experience executing and overseeing bank acquisitions, including NationsBank Corp.’s acquisition and integration of Bank of America, Maryland National Bank and Barnett Banks, Inc. Our Chief Financial Officer, Christopher G. Marshall, has over 30 years of financial and managerial experience, including service as the Chief Financial Officer of Fifth Third Bancorp and as the Chief Operations Executive for Bank of America’s Global Consumer and Small Business Bank. Our Chief Risk Officer, R. Bruce Singletary, has over 32 years of experience, including 19 years of experience managing credit risk. He has served as Head of Credit for NationsBank Corp. for the Mid-Atlantic region and as Senior Risk Manager for commercial banking for Bank of America’s Florida Bank. Kenneth A. Posner serves as our Chief of Investment Analytics and Research. Mr. Posner spent 13 years as an equity research analyst at Morgan Stanley focusing on a wide range of financial services firms.

Our banking operations commenced on July 16, 2010, when we purchased approximately $1.2 billion of assets and assumed approximately $960.1 million of deposits of three Failed Banks from the FDIC: First National Bank, Metro Bank and Turnberry Bank. The acquired assets included loans with an estimated fair value

of $768.6 million at the acquisition date. These transactions gave us an initial market presence in Miami, which we targeted because of its size and concentrated business activity, and South Carolina, which we targeted because of its attractive demographic growth trends. In connection with the acquisition, we entered into loss-sharing arrangements with the FDIC covering approximately $796.1 million of loans and real estate owned of the Failed Banks that we acquired.

On September 30, 2010, we invested approximately $175.0 million in TIB Financial, a publicly held bank holding company headquartered in Naples, Florida with approximately $1.7 billion in assets at the acquisition date and, after giving effect to a subsequent rights offering to legacy TIB Financial shareholders, we acquired approximately 94% of TIB Financial’s common stock. The acquired assets included loans with an estimated fair value of $1.0 billion at the acquisition date. This acquisition expanded our geographic reach in Florida to include markets that we believe have particularly attractive deposit customer characteristics and provided a platform to support our future growth.

On January 28, 2011, we invested approximately $181.1 million in Capital Bank Corp., a publicly held bank holding company headquartered in Raleigh, North Carolina, with approximately $1.7 billion in assets at the acquisition date and, after giving effect to a subsequent rights offering to legacy Capital Bank Corp. shareholders, we acquired approximately 83% of Capital Bank Corp.’s common stock. The acquired assets included loans with an estimated fair value of $1.1 billion at the acquisition date. This transaction gave us a strong presence in fast-growing North Carolina markets, including the Raleigh MSA, which, according to SNL Financial, has the eleventh highest projected population growth rate in the nation, with over 12% growth projected between 2011 and 2016.

On September 7, 2011, we invested approximately $217.0 million in Green Bankshares, a publicly held bank holding company headquartered in Greeneville, Tennessee, with approximately $2.4 billion in assets at the acquisition date, and we acquired approximately 90% of Green Bankshares’ common stock. The acquired assets included loans with an estimated fair value of $1.3 billion at the acquisition date. This transaction extended our market area into the fast-growing Tennessee metropolitan areas of Nashville and Knoxville.

On March 26, 2012, we agreed to acquire all of the common equity interest in Southern Community Financial, a publicly held bank holding company headquartered in Winston Salem, North Carolina. On June 25, 2012, we amended our agreement with Southern Community Financial to change the form of consideration offered to Southern Community stockholders. The merger consideration for all of the common equity interest consists of approximately $52.4 million in cash. Our acquisition of Southern Community Financial is subject to Southern Community Financial stockholder approval, regulatory approvals and other customary closing conditions, and is expected to be completed in the second half of 2012. Total assets as of June 30, 2012 included $0.9 billion of gross loans. This acquisition will extend our market area in the North Carolina markets, including Winston-Salem, the fifth largest MSA in North Carolina, and the Piedmont Triad.

The following table sets forth the fair value of the assets we acquired in each of our acquisitions as of the applicable acquisition date and shows the acquisition price as a percentage of the most recently reported tangible book value of the assets prior to acquisition accounting and the tangible book value in accordance with the acquisition method of accounting:


Large accelerated filer ¨		Accelerated filer ¨

Non-accelerated filer x	(Do not check if a smaller reporting company)	Smaller reporting company ¨


TIB Financial Corp.		Capital Bank Financial Corp.
599 9^th Street North, Suite 101		121 Alhambra Plaza, Suite 1601
Naples, Florida 34102-5624		Coral Gables, Florida 33134
(239) 263-3344		(305) 670-0200
Attn: Investor Relations		Attn: Investor Relations


	Page
SECTIONS OF THE FLORIDA BUSINESS CORPORATION ACT		APPENDIX C
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2011 AND RELATED PERIODS		APPENDIX D
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2012 AND RELATED PERIODS		APPENDIX E


	As of June 30, 2011
	CBF				TIB Financial		Capital Bank Corp.		Green Bankshares
	(Actual)		(Pro Forma)⁽¹⁾		(Actual)		(Actual)		(Pro Forma)⁽²⁾
	(In thousands, except per share data)
Shareholders’ Equity	$	951,692	$	982,552	$	180,036	$	228,377	$	249,082
Less: Noncontrolling Interest		48,670		83,405		–		–		–

Adjusted Shareholders’ Equity		903,022		899,147		180,036		228,377		249,082

Actual Goodwill & Intangibles		80,549		124,493		3,288		–		–
Allocation of Bank Intangibles⁽³⁾		–		–		28,823		33,343		45,254
Less: Tax-Effect of Intangibles		6,511		10,345		3,440		2,513		3,410

Adjusted Goodwill & Intangibles		74,038		114,147		28,671		30,830		41,844

Tangible Book Value	$	828,984	$	785,000	$	151,365	$	197,547	$	207,238

Shares Outstanding		46,149,998		46,149,998		12,349,935		85,802,164		133,147,109

Tangible Book Value per Share	$	17.96	$	17.01	$	12.26	$	2.30	$	1.56


	CBF Combined Ownership
	Shares (in thousands)		Ownership			Exchange Ratios
Legacy Shareholders:
CBF		46,150		92.6	%		N/A
TIB Financial		2,004		1.0	%		0.7205
Capital Bank Corp.		492		4.0	%		0.1354
Green Bankshares		1,213		2.4	%		0.0915

		49,859		100.0	%


	Page
QUESTIONS AND ANSWERS		1
SUMMARY		4
SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF CBF		7
SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF TIB FINANCIAL		11
SUMMARY UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL DATA		14
COMPARATIVE HISTORICAL AND UNAUDITED PRO FORMA PER SHARE FINANCIAL DATA		18
MARKET INFORMATION		19
RISK FACTORS		20
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		47
THE MERGER		48
Terms of the Merger		48
Background and Reasons for the Merger		48
Our Conflict of Interest		51
Fairness Opinion from Sterne Agee		52
Appraisal Rights		56
REGULATORY APPROVALS REQUIRED FOR THE MERGER		60
ACCOUNTING TREATMENT		61
THE PLAN OF MERGER		62
Structure of the Merger		62
Treatment of TIB Financial Stock Options		62
Treatment of TIB Warrant		62
Conversion of Shares; Exchange of Certificates		63
Effective Time of the Merger		63
MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER		64
Tax Consequences of the Merger Generally		65
Cash Instead of a Fractional Share		65
Backup Withholding		66
INFORMATION ABOUT CBF		67
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		83
SUPERVISION AND REGULATION		159
INFORMATION ABOUT TIB FINANCIAL		173
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION		174
MANAGEMENT		185
CERTAIN RELATED-PARTY TRANSACTIONS		204
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT		205
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS		209
DESCRIPTION OF CAPITAL STOCK		212
HISTORICAL MARKET PRICES AND DIVIDEND INFORMATION		216
COMPARISON OF RIGHTS OF CBF SHAREHOLDERS AND TIB FINANCIAL SHAREHOLDERS		217
LEGAL MATTERS		233
EXPERTS		233
INDEX TO FINANCIAL STATEMENTS		F-1
PLAN OF MERGER		APPENDIX A
OPINION OF STERNE, AGEE & LEACH, INC.		APPENDIX B


	As of and for Six Months Ended June 30, 2012
	CBF				TIB Financial
	Historical		Pro Forma Combined		Historical		Pro Forma Equivalent ⁽¹⁾
	($ per share)
Earnings per share—basic	$	0.24	$	0.21	$	0.32	$	0.15
Earnings per share—diluted	$	0.24	$	0.21	$	0.32	$	0.15
Book value per share	$	20.26	$	20.29	$	14.74	$	14.62
Cash dividends declared per share	$	—	$	—	$	—	$	—


	As of and for Year Ended December 31, 2011
	CBF					TIB Financial
	Historical		Pro Forma Combined			Historical		Pro Forma Equivalent⁽¹⁾
	($ per share)
Earnings per share—basic	$	0.14	$	(0.69	)	$	0.23	$	(0.50	)
Earnings per share—diluted	$	0.14	$	(0.69	)	$	0.23	$	(0.50	)
Book value per share	$	19.86	$	19.87		$	14.36	$	14.32
Cash dividends declared per share	$	—	$	—		$	—	$	—


	TIB Financial Common Stock
September 7, 2011	$	11.68
[—], 2012	$	[—]


(Dollars in thousands)	Efficiency Ratio for the Six months ended June 30, 2012						Efficiency Ratio for the Year Ended December 31,2011
	Non-Adjusted			Adjusted			Non-adjusted			Adjusted
Non-interest expense	$	121,546		$	121,546		$	182,195		$	182,195
Less: Non-cash equity compensation		—			(10,685)			—			(9,236)
Less: information technology conversion		—			(3,045)			—			(7,620)
Less: Legal fees		—			—			—			(1,500)
Less: Impairment of intangible asset		—			—			—			(2,872)

Non-interest expense, adjusted	$	121,546		$	107,816		$	182,195		$	160,967

Net interest income	$	127,197		$	127,197		$	191,320		$	191,320
Non-interest income		26,681			26,681			41,227			41,227

Less: Investment security gains		—			(3,648)			—			(4,401)
Net revenue	$	153,878		$	150,230		$	232,547		$	228,146

Efficiency Ratio		78.99	%		71.77	%		78.35	%		70.55	%


Target Metropolitan Statistical Area	Number of Our Branches⁽¹⁾		June 30, 2012 Total MSA Deposits⁽¹⁾⁽²⁾		2011 Total Population^*(2)		2011-16 Projected Pop. Growth*			2011 Median Household Income*		2011-16 Projected Household Income Growth*
Miami-Fort Lauderdale-Pompano Beach-Homestead, FL		11		428,978		5,572		3.0	%	$	44,980		19.00	%
Charlotte-Gastonia-Rock Hill, NC-SC		1		36,553		1,792		8.8			53,790		12.45
Nashville-Davidson-Murfreesboro-Franklin, TN		21		605,849		1,615		7.1			50,429		11.58
Raleigh-Cary, NC		13		429,361		1,158		12.3			57,511		12.57
Columbia, SC		5		117,552		778		7.2			46,718		14.62
Knoxville, TN		10		203,139		705		5.2			40,794		22.18
Durham-Chapel Hill, NC		2		88,262		511		6.8			46,117		17.81
Spartanburg, SC		3		177,393		287		4.7			42,292		19.54
Winston-Salem, NC		11		705,027		482		5.1			44,136		19.12
Target MSAs⁽³⁾		77		2,792,114		12,900		6.0			47,111		16.8
CBF Consolidated⁽³⁾		165		6,196,922		19,528		4.8			44,566		16.2
National Aggregate						310,704		3.4			50,227		14.6